Document:

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                                             Employment Agreement - EXHIBIT 10.3

                             EMPLOYMENT AGREEMENT
                             --------------------

     THIS AGREEMENT made this 11th day of October, 1994, by and between SALEM
BANK & TRUST, N.A., a national banking association with principal offices at 220
East Main Street, Box 979, Salem, Virginia 24153 (hereinafter referred to as
"Employer"), and CARL E. TARPLEY, JR., residing at 3207 Links Manor Drive,
Salem, Virginia 24153 (hereinafter referred to as "Employee").

                             W-1-T-N-E-S-S-E-T-H:

     WHEREAS, engaging Employee's services for and on behalf of Employer is of
material importance to the preservation and enhancement of the value of
Employer's business;

     WHEREAS, Employer recognizes, as is the case with many publicly held
corporations, the possibility that a change in control may arise and that such
possibility, and the uncertainty and questions which it may raise among
management, may result in the departure or distraction of management personnel
to the detriment of Employer and the shareholders of Employer;

     WHEREAS, the Board of Directors of Employer (the "Board") has determined
that appropriate steps should be taken to reinforce and encourage the continued
attention and dedication of members of Employer's management to their assigned
duties without distraction by the possibility of a change in control of
Employer; and

     WHEREAS, the Board believes it important, should Employer or the
shareholders of Employer receive a proposal for transfer of control of Employer,
that Employee be able to assess such proposal and advise the appropriate Boards
thereon, without being unduly influenced by the uncertainties of Employee's
personal situation;
<PAGE>

     NOW, THEREFORE, in consideration of the mutual covenants herein set forth,
Employer and Employee do hereby agree as follows:

1.   ACTIVE TERM.
     -----------

     1.1  Employer hereby employs Employee as its Executive Vice President to
perform executive services as hereinafter provided, and Employee hereby accepts
said employment and agrees to render such services to Employer on the terms and
conditions set forth in this Agreement for an initial term of three (3) years
commencing no later than October 11, 1994, and terminating October 10, 1997,
unless sooner terminated in accordance with the terms and conditions hereinafter
set forth.  On October 11 of each year following the date of execution of this
Agreement, this Agreement shall be considered renewed for an additional year to
bring this Agreement back to a three (3) year term, unless at least thirty (30)
days' prior written notice by either party is given to the other party of intent
to terminate this Agreement upon expiration of the then-current term.
Immediately upon a change in control, as defined in Section V of this Agreement,
this Agreement shall automatically renew for a period of thirty-six (36) months
following the date of such change in control.

     1.2  During the term of this Agreement, Employee agrees to perform such
executive services for Employer as may from time to time be assigned to Employee
by Employer, its Board of Directors or the Executive Committee of the Board.

     1.3  During the term of this Agreement, Employee shall devote his full time
and best efforts to the affairs and business of Employer.

     1.4  Employee shall serve as a director of Employer and, with his consent,
as a director of any subsidiary or affiliate of Employer.

     1.5  Employee's services shall be rendered principally in Salem, Virginia,
                                                -----------
but Employee shall do such traveling on behalf of Employer as may reasonably be
required.

II.  COMPETITIVE ACTIVITIES.
     ----------------------

                                       2
<PAGE>

     2.1  Employee agrees that, during the term of his employment hereunder,
except with the express consent of Employer, Employee will not, directly or
indirectly, engage or participate in, become a director of, or render advisory
or other services for, or in connection with, or become interested in, or make
any financial investment in, any firm, corporation, business entity or business
enterprise competing with any business of Employer, whether presently in
existence or hereafter acquired; provided, however, that Employee shall not
thereby be precluded or prohibited from owning passive investment so long as
such ownership does not enable Employee to manage or control the business or
activities in which Employee has invested, and so long as (i) such investment
represents not in excess of the lesser of five percent (5%) of the equity in any
such entity or an investment of $50,000 in any such entity, and (ii) except for
passive investment in securities of publicly traded companies, such ownership
and any changes therein are promptly reported in writing by Employee to the
Board.  Notwithstanding anything to the contrary contained in this Agreement,
while Employee is employed by Employer during the term of this Agreement.
Employee shall have no employment contract or other written or oral agreement
concerning employment as an officer of Employer with any entity or person other
than Employer.

     2.2  Employee agrees and acknowledges by virtue of his employment hereunder
that he will be privy to an intimate knowledge of the activities and affairs of
Employer, including trade secrets and other confidential matters.  Employee
therefore agrees that if, during the term of employment, Employee renders
services to a competitor of Employer or its subsidiaries, if any, other than as
expressly authorized by the Board, Employer shall be entitled to immediate
injunctive or other equitable relief to restrain Employee from rendering
Employee's services to others than Employer and its subsidiaries and affiliates,
if any, in addition to any other remedies to which Employer may be entitled
under law; provided, however, that the right to such injunctive or other
equitable relief shall not survive the termination by Employer or Employee of
Employee's employment.  Except for the purpose of carrying out Employee's duties
hereunder, Employee will not remove or retain, or

                                       3
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make copies or reproductions of any inquiries, calculations, letters, papers, or
information of any type or description relating to the business of Employer, its
subsidiaries or affiliates, if any, and Employee agrees that he will not divulge
to others any information or data acquired by him while in Employer's employ
relating to methods, processes, or other trade secrets or confidential
information. Employee further agrees that Employer is and shall be the sole and
exclusive owner of all improvements, ideas, and suggestions (whether or not
subject to patent or trademark protection), and all copyrightable materials
which are conceived by Employee during his employment, which relate to the
business of Employer or any of its subsidiaries or affiliates, which are
confidential, and which are not readily ascertainable from persons or other
sources outside Employer and its subsidiaries and affiliates.

III. COMPENSATION.
     ------------

     3.1  Employer will compensate and pay Employee for his services as follows:

          a.   Employee will be paid a salary at the annual rate of the greater
of (i) such salary as the Board of Directors may set from time to time or (ii)
$63,922.00, payable in equal installments on the regular paydays then
established for executive personnel of Employer;

          b.   Employee will be reimbursed in a manner consistent with policies
of Employer heretofore or hereafter established for executive personnel, for all
reasonable expenses directly incurred by Employee in the discharge of any duties
hereunder;

          c.   Employee will receive such perquisites as senior executive
employees have historically been granted by Employer and as were being provided
to Employee immediately prior to the execution of this Agreement; and

          d.   Employee will receive such fringe benefits as shall be made
generally and proportionally available to other employees of Employer including,
but not limited to, the benefits of any Plan (as hereinafter defined).

                                       4
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     For purposes of this Agreement, "Plan" shall mean any compensation plan
such as an incentive, stock option or restricted stock plan or any employee
benefit plan such as a thrift, pension, profit sharing, long term performance
award, medical disability, accident, life insurance plan or a relocation plan or
policy or any other plan, program or policy now or hereafter established by
Employer and which is intended to benefit employees.

     All payments made or payable to Employee under this Agreement shall be
subject to withholding for applicable taxes, social security or other
governmental levies and to insurance, savings or any other deductions
authorized, or for Employee's benefit, under any program established for or made
available to employees of Employer generally.

     3.2  Nothing in this Agreement shall prevent the Board of Directors of
Employer from at any time increasing the compensation and fringe benefits to be
paid to Employee in the event the Board of Directors in its sole discretion
shall deem it advisable to do so in order to compensate Employee for his
services.

IV.  TERMINATION PRIOR TO CHANGE IN CONTROL.
     --------------------------------------

     4.1  Employer shall have the right, at any time prior to a change in
control of Employer as defined in Section V of this Agreement, upon prior
written notice of not less than thirty (30) days, to terminate Employee's
employment hereunder, subject to the compensation provisions contained herein.

     4.2  In the event that, prior to a change in control of Employer (as
defined in Section V hereof), Employee's employment is terminated pursuant to
subsection 4.1, for cause (as defined in the next paragraph), Employee shall
have no right to compensation or other benefits for any period after such
termination. If Employee is terminated pursuant to subsection 4.1 prior to a
change in control of Employer, other than for cause, Employee's right to
compensation and other benefits under this Agreement shall continue for the
remaining term of this Agreement (except that bonuses payable under any
executive incentive compensation plan will be paid to Employee only through the
end of Employer's fiscal year during which Employee's employment is terminated,
in an amount equal to the amount which would have been payable to

                                       5
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Employee (at a percentage participation no less than Employee received from the
last distribution under the Plan) had Employee continued in the employ of
Employer for the entirety of such fiscal year multiplied by a fraction
consisting of a numerator equal to the number of days between the beginning of
such fiscal year and the date of the termination of Employee's employment and a
denominator of 365), and Employee shall have the right after such termination to
accept employment with a competing financial institution or other enterprise
notwithstanding the provisions of Section II hereof.

     For the purposes of this subsection 4.2, the term "cause" shall mean
personal dishonesty, gross incompetence, willful misconduct, willful breach of
fiduciary duty, willful violation of any federal, state, or local law, rule or
regulation (other than traffic violations or similar offenses), willful
violation of a final cease and desist order, willful breach or neglect of
Employee's duties hereunder, gross negligence, or misconduct in the performance
of Employee's duties.

V.   CHANGE IN CONTROL.
     -----------------

     5.1  For purposes of this Agreement, a "change in control" of Employer
shall have occurred at such time as (a) the Federal Reserve Board should have
approved a notice filed by any Person (as hereinafter defined) with respect to
Employer pursuant to either 12 C.F.R. (S)225.11 or 12 C.F.R. (S)225.41 (or any
successor regulation thereto), as either is in effect on the date hereof; (b)
any Person becomes the 'beneficial owner" (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934 or any successor regulation thereto), directly
or indirectly, of 25% or more of the combined voting power of Employer's
outstanding securities ordinarily having the right to vote at elections of its
directors; (c) individuals who constitute Employer's Board of Directors on the
date hereof (the "Incumbent Board") cease for any reason to constitute at least
a majority thereof; provided that any person becoming a director subsequent to
the date hereof whose election, or nomination for election by Employer's
shareholders, was approved by a vote of at least three quarters of the directors
comprising the Incumbent Board shall be considered as though such Person were a

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member of the Incumbent Board for purposes of this Section V; (d) the merger, or
consolidation of Employer with or into another corporation; or (e) the sale,
conveyance or other transfer of substantially all of the assets of Employer.

     5.2  For the purpose of this Agreement, the term "Person" shall include any
individual, corporation, partnership, group, association or other "person," as
such term is used in Section 14(d) of the Exchange Act, other than Employer or
any employee benefit plan(s) sponsored by Employer.

VI.  TERMINATION FOLLOWING CHANGE IN CONTROL.
     ---------------------------------------

     6.1  If any of the events described in Section V hereof constituting a
change in control of Employer shall have occurred, Employee shall be entitled to
compensation provided in subsection 7.2 of Section VII hereof upon Employee's
determination to terminate his employment with Employer or upon termination by
Employer of Employee's employment with Employer.

     6.2  Any termination by either party hereto following a change in control
shall be communicated by written notice of termination ("Notice of Termination")
to the other party hereto.  Such Notice of Termination shall specify the date as
of which employment shall terminate ("Date of Termination"), which said Date of
Termination shall not be more than sixty (60) days after the date of the Notice
of Termination.

VII. COMPENSATION UPON TERMINATION: OTHER AGREEMENTS.
     -----------------------------------------------

     7.1  During any period following a change in control that Employee fails to
perform his duties as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his salary at the rate then in effect and any
benefits or awards under any Plans shall continue to accrue during such period,
to the extent not inconsistent with such Plans, until Employee's employment is
terminated pursuant to and in accordance with Section VI hereof.  Thereafter,
Employee's compensation and other benefits shall be determined in accordance
with subsection 7.2 hereof and the Plans then in effect.

                                       7
<PAGE>

     7.2  Subject to subsections 6.1 and 7.4 and Section X hereof, if within
thirty-six (36) months of the date on which a change in control shall have
occurred, as defined in Section V above, Employee's employment with Employer
shall be terminated by Employer, then Employee shall be entitled, without regard
to any contrary provisions of any Plan, to the following benefits:

          (A)  For the period which is the greater of (i) the remaining term of
employment provided for in this Agreement or (ii) twenty-four (24) months,
commencing on the Date of Termination, Employer shall continue to provide
Employee all perquisites which were being provided to Employee immediately prior
to the Date of Termination and shall make provisions and pay all insurance
premiums as they come due during such period so that Employee's medical
insurance benefits, life insurance and accident insurance plan coverage will
continue to be on terms and at levels substantially the same as those existing
on the day prior to the Date of Termination;

          (B)  For the period which is the greater of (i) the remaining term of
employment provided for in this Agreement or (ii) 12 months, commencing on the
Date of Termination, Employer shall continue to pay to Employee the Annual
Compensation theretofore received by Employee from Employer.  For purposes of
this Agreement, "Annual Compensation" shall mean Employee's current annual base
salary immediately preceding the change in control or immediately preceding the
Date of Termination, whichever is the greater, in accordance with Section 3.1(a)
hereof.  Should there be a distribution from any executive incentive
compensation plan at the close of the plan year during which termination occurs,
Employer shall in addition be paid the amount provided for in Section 4.2
hereof.

          (C)  Employee shall be or become vested under all Plans as of the date
when the last compensation under this Agreement is due to be paid to Employee.

     7.3  The amount of any payment provided for in this Section VII shall not
be reduced, offset, or subject to recovery by Employer by reason of any
compensation earned by Employee as a result of subsequent

                                       8
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employment by another employer other than a competing banking institution
located within fifty (50) miles of 220 East Main Street, Salem, Virginia, after
the Date of Termination, or otherwise.

      7.4  Notwithstanding the other provisions of this Section VII, should
Employer terminate Employee for intentional misconduct tantamount to the
commission of a felony and relating to his employment, no further compensation
shall be paid to Employee after the Date of Termination. Otherwise, Employee
shall be entitled to the full compensation provided for herein after his
termination whether such termination is by Employee or Employer, subject,
however, to the provisions of subsection 6.1 of Section VI.

VIII. SUCCESSORS: BINDING AGREEMENT.
      -----------------------------

      8.1  This Agreement shall inure to the benefit of and be binding upon any
corporate or other successor of Employer which shall result from a change in
control as defined in Section V hereof.  Employer shall require any such
successor, by an agreement in form and substance satisfactory to Employee,
expressly to assume and agree to perform this Agreement in the same manner and
to the same extent as Employer would be required to perform if no such
succession had taken place.

      8.2  This Agreement shall inure to the benefit of and be enforceable by
Employee's personal or legal representative, executors, administrators,
successors, heirs, distributees, devisees, and legatees.  If Employee should die
while any amount would still be payable to Employee hereunder at the time of
death of Employee, such amounts, unless otherwise provided herein, shall be paid
in accordance with the terms of this Agreement to Employee's devisee, legatee,
beneficiary, or designee or, if there be no such designee, to Employee's estate.

IX.   FEES AND EXPENSES.
      -----------------

      Employer shall provide in advance and pay all legal fees and related
expenses incurred by Employee as a result of Employee's seeking to obtain or
enforce any right or benefit provided by this Agreement.

X.    TAXES.
      -----

                                       9
<PAGE>

     10.1 All payments to be made to Employee under this Agreement win be
subject to required withholding of federal, state and local income and
employment taxes.

     10.2 Anything in this Agreement to the contrary notwithstanding, in the
event that mutually satisfactory independent auditors (the "Auditors") shall
determine that any payment or distribution by Employer to or for Employee's
benefit (whether paid or. payable or distributed pursuant to the terms of this
Agreement or otherwise) (a "Payment") would be a "parachute payment" as defined
in Section 28OG of the Internal Revenue Code (the "Code"), then the aggregate
present value of amounts payable or distributable to or for Employee's benefit
pursuant to this Agreement (such payments or distributions pursuant to this
Agreement are hereinafter referred to as "Agreement Payments") shall be reduced
(but not below zero) to the Reduced Amount. For purposes of this subsection 10.2
of this Section Y., the "Reduced Amount" shall be an amount expressed in present
value which maximizes the aggregate present value of Agreement Payments such
that the aggregate present value of Payments equals the Reduced Amount.

     10.3 If the Auditors determine that any Payment would be a "parachute
payment" as defined in Section 28OG of the Code, Employer shall promptly give
Employee notice to that effect and a copy of the detailed calculation thereof
and of the Reduced Amount. Employee may then elect, in his sole discretion,
which and what amount of Agreement Payments shall be eliminated or reduced (as
long as after such election the aggregate present value of the Agreement
Payments equals the Reduced Amount), and Employee shall advise Employer in
writing of Employee's election within 10 days of Employee's receipt of notice.
If no such election is made by Employee, Employer may elect which and how much
of the Agreement Payments shall be eliminated or reduced (as long as after such
election the aggregate present value of the Agreement Payments equals the
Reduced Amount) and shall notify Employee promptly of such election. For
purposes of this subsection 10.3 of this Section X, present value shall be
determined in accordance with Section 28OG(d)(4) of the Code. All determinations
made by the Auditors under this paragraph shall be made within 60 days of the

                                       10
<PAGE>

Notice of Termination. In accordance with Section VII hereof and as promptly as
practicable following such determination and the elections hereunder, Employer
shall pay to or distribute to or for Employee's benefit such amounts as are the
due to Employer under this Agreement and shall promptly pay to or distribute for
Employer's benefit in the future such amounts as become due to Employee under
this Agreement.

     10.4 As a result of the uncertainty in this application of Section 28OG of
the Code at the time of the initial determination by the Auditors hereunder, it
is possible that Agreement Payments will have been made by Employer which should
not have been made ("Overpayment") or that additional Agreement Payments will
not have been made by Employer which should have been made ("Underpayment"), in
each case consistent with the calculation of the Reduced Amount hereunder.  In
the event that the Auditors, based upon the assertion of a deficiency by the
Internal Revenue Service against Employer or Employee which the Auditors believe
has a high probability of success, determine that an Overpayment has been made,
such Overpayment shall be treated for all purposes as a loan to Employee which
Employee shall repay to Employer together with interest at the applicable
federal rate provided for in Section 7872(f)(2) of the Code; provided, however,
that no amount shall be payable by Employee to Employer if and to the extent
such payment would not be considered for federal income tax purposes to reduce
the amount of Payments which are considered to be "parachute payments" within
the meaning of Section 28OG of the Code.  In the event that the Auditors, based
upon controlling precedent, determine that an Underpayment has occurred, any
such Underpayment shall be promptly paid by Employer to or for Employee's
benefit together with interest at the applicable federal rate provided for in
Section 7872(f)(2) of the Code.

     10.5 If any of the Agreement Payments will be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code or any similar tax that may
hereafter be imposed (the "Excise Tax"), Employer shall pay to Employee at the
time specified below an additional amount (the "Gross-up Payment") such that the
net amount retained by Employee, after deduction of any Excise Tax on the
Agreement Payments and any federal,

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state and local income tax and Excise Tax upon the Gross-up Payment, but before
deduction for any federal, state or local income tax on the Agreement Payments,
shall be equal to the total amount of the Agreement Payments.

     10.6 For purposes of determining whether any of the Agreement Payments will
be subject to the Excise Tax and the amount of such Excise Tax, (i) the total
Agreement Payments shall be treated as "parachute payments" within the meaning
of Section 28OG(b)(2) of the Code, and all "excess parachute payments" within
the meaning of Section 28OG(b)(1) of the Code shall be treated as subject to the
Excise Tax, unless in the opinion of tax counsel selected by the Auditors, such
other payments or benefits (in whole or in part) do not constitute parachute
payments, or such excess parachute payments (in whole or in part) represent
reasonable compensation for services actually rendered within the meaning of
Section 28OG(b)(4) of the Code in excess of the base amount within the meaning
of Section 28OG(b)(3) of the Code or are otherwise not subject to the Excise
Tax, (ii) the amount of the Agreement Payments which shall be treated as subject
to the Excise Tax shall be equal to the lesser of (A) the total amount of the
Agreement Payments or (B) the amount of excess parachute payments within the
meaning of Section 28OG(b)(1) of the Code (after applying clause (i) above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit
shall be determined by the Auditors in accordance with the principles of
Sections 28OG(d)(3) and (4) of the Code.

     10.7 For purposes of determining the amount of the Gross-up Payment,
Employee shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation for the calendar year in which the Gross-up
Payment is to be made and the applicable state and local income taxes at the
highest marginal rate of taxation for the calendar year in which the Gross-up
Payment is to be made, net of the maximum reduction in federal income taxes
which could be obtained from deduction of such state and local taxes.  In the
event that the Excise Tax is subsequently determined to be less than the amount
taken into account hereunder at the time the Gross-up Payment is made, Employee
shall repay to Employer at the time that the amount of such reduction in

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Excise Tax is finally determined the portion of the Gross-up Payment
attributable to such reduction (plus the portion of the Gross-up Payment
attributable to the Excise Tax and federal, state and local income tax imposed
on the portion of the Gross-up Payment being repaid by Employee if such
repayment results in a reduction in Excise Tax and/or a federal, state and
local income tax deduction), plus interest on the amount of such repayment at
the applicable federal rate. In the event that the Excise Tax is determined to
exceed the amount taken into account hereunder at the time the Gross-up Payment
is made (including by reason of any payment the existence or amount of which
cannot be determined at the time of the Gross-up Payment), Employer shall make
an additional Gross-up Payment in respect of such excess (plus any interest
payable with respect to such excess) at the time that the amount of such excess
is finally determined.

     10.8 The Gross-up Payment or portion thereof provided for above shall be
paid not later than the thirtieth (30th) day following payment of any amounts
under Section VII; provided, however, that if the amount of such Gross-up
Payment or portion thereof cannot be finally determined on or before such day,
Employer shall pay to Employee on such day an estimate, as determined in good
faith by Employer, of the minimum amount of such payments and shall pay the
remainder of such payment (together with interest at the applicable federal
rate) as soon as the amount thereof can be determined, but in no event later
than the forty-fifth (45th) day after payment of any amounts under Section VII.
In the event that the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall constitute a loan by
Employer to Employee, payable on the fifth (5th) day after demand by Employer
(together with interest at the applicable federal rate).

     10.9 All determinations made by the Auditors pursuant to this Section X
shall be binding upon Employer and Employee.

XI.  SURVIVAL.
     --------

                                       13
<PAGE>

     The respective obligations of, and benefits afforded, Employer and Employee
as provided in Sections III, VII, VIII, IX, X, XI, XII, XIII, XIV and XV of this
Agreement shall survive termination of this Agreement.

XII. NOTICES.
     -------

     For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by United States certified or
registered mail, return receipt requested, postage prepaid and addressed to the
addresses set forth on the first page of this Agreement, provided that all
notice to Employer shall be directed to the attention of the most senior officer
of Employer other than Employee, or to such other addresses as either party may
have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be in effect only upon receipt.

XII. MISCELLANEOUS.
     -------------

     No provision of this Agreement may be modified, waived or discharged unless
such modification, waiver or discharge is agreed to in a writing signed by
Employee and the most senior officer of Employer other than Employee.  No waiver
by either party hereto at any time of any breach by the other party hereto of,
or of compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a wavier of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.  No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not expressly set forth in this Agreement.  The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the Commonwealth of Virginia.

XIV. VALIDITY.
     --------

     The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

                                       14
<PAGE>

XV.  RELATED AGREEMENTS.
     -------------------

     To the extent that any provision of any other agreement between Employer or
any of its subsidiaries and Employee shall limit, qualify or be inconsistent
with any provision of this Agreement, then for purposes of this Agreement, while
the same shall remain in force, the provision of this Agreement shall control
and such provision of such other agreement shall be deemed to have been
superseded, and to be of no force and effect, as if such other agreement had
been formally amended to the extent necessary to accomplish such purpose.

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.

EMPLOYEE:                               EMPLOYER:
                                             SALEM BANK & TRUST, N.A.

______________________________          By:  _____________________________

CARL E. TARPLEY, JR.                         President

                                       15<PAGE>

                                                            Lease - EXHIBIT 10.4

                           COMMONWEALTH OF VIRGINIA
                           Alleghany Health District
                         Roanoke City Health District

Serving the People of:
Alleghany County
Botetourt County                March 6, 2000            Reply to:
Craig County                                             515 Eighth Street, Sw
Roanoke County                                           Roanoke, VA 24016
City of Clifton Forge                             Phone: (540) 857-7600 Ext. 274
City of Covington                                        FAX: (540) 857-6987
City of Roanoke
City of Salem

Clark Owen, Jr., President
Salem Bank & Trust
220 E. Main Street
Salem, VA 24153

Dear Mr. Owen:
This is to confirm our telephone call of this date concerning the renewal of our
lease in the Olde Newberry Building.

Paragraph 10. of our lease provides that "... at the end of the initial term,
this lease shall automatically renew and continue in full force and effect from
year to year......".

It is our proposal and you agree that we allow this lease to continue for the
period July 1, 2000 to June 30, 2001 under the same terms and conditions.

Sincerely yours,

Milton Carter
Business Manager
<PAGE>

                                 DEED OF LEASE

     This DEED OF LEASE, is made this lst day of July 1995 by and between Salem
                                      ---        ----                     -----
Bank and Trust (The "Lessor) and the COMMONWEALTH OF VIRGINIA, by the VIRGINIA
--------------
DEPARTMENT OF HEALTH (the"Lessee") with approval of the Governor pursuant to
(S)2.1-504.2 of the Code of Virginia (1950), as amended.

                                  WITNESSETH

     For and in consideration of the terms, conditions, covenants, promises and
agreements herein made, Lessor hereby leases and demises unto Lessee the
following described real property (the "demised premises"): (Include parking
facilities and number of parking spaces, it any, and rentable square footage or,
acreage.)

     7025 square feet of office and clinic space on the lower level of the Olde
Newberry Building located at 110 E. Main Street, Salem, Virginia and twenty (20)
parking spaces at the location.  This lease is subject to a rental amount of
$37,806/annum for a period of five (5) years.

1.   INITIAL TERM OF LEASE: The demised premises are leased to Lessee for a
period of Five (5) (years), beginning on the lst day of July, 1995 and
          --------                           ---        ------  --
terminating on the 30 day of June, 2000(the 'initial term").
                   --        ----- ----

2.   RENT: Lessee covenants to pay Lessor the sum of one hundred eighty nine
                                                     -----------------------
thousand and thirty Dollars ($189,030) as rent for the initial term which amount
-------------------
shall be paid in installments of nine thousand four hundred fifty one and fifty
                                 ----------------------------------------------
cents dollars ($9,451.50) due and payable in arrears at the end of each quarter
-----         -----------                                               -------
(month/quarter).

Rent shall be made payable to Salem Bank and Trust and mailed to  Salem Bank and
                              ---------------------               --------------
Trust at 220 E. Main Street, Salem 24153 or to such other party and such other
-----    -------------------------------
place as Lessor may from time to time designate in writing as provided herein.
<PAGE>

3.   PURPOSE AND USE OF DEMISED PREMISES:

     The demised premises are leased to be used and occupied by the VIRGINIA
DEPARTMENT OF HEALTH, a department, agency or institution of the Commonwealth of
Virginia (the 'leasing agency"), and its agents and employees, for such purposes
and uses as it may now or hereafter be empowered by law to use same.

4.   ACCESSIBILITY BY THE HANDICAPPED

     (A)  Prior to commencement of the initial term and delivery of possession,
                   ------------
          Lessor shall certify to Lessee in writing that the demised premises
          complies. with minimum requirements of the Americans with Disabilities
          Act of 1990 (the "ADA").  In the event the demised premises is not
          required to comply with the ADA., Lessor shall certify to Lessee in
          writing that the demised premises complies with minimum requirements
          of the Virginia Uniform Statewide Building Code pertaining to access
          by disabled persons. As hereinafter used, the term "the standards"
          shall mean and incorporate those standards approved by the United
          State Department of Justice for meeting the minimum requirements of
          the Americans with Disabilities Act of 1990 or, if applicable, those
          standards issued or promulgated by the American National Standards
          Institute, entitled 'American National Standard Specifications for
          Making Buildings and Facilities Accessible to and Usable by Physically
          Handicapped People', ANSI-A117.1-1980, and the term 'accessible" shall
          mean accessible to disabled individuals in accordance with the ADA.
          The minimum Virginia Uniform Statewide Building Code requirements are:
              -------

     (1)  If public or private parking is provided, at least one accessible
          parking space shall be provided as close as possible to an accessible
          route to the primary building entrance.

     (2)  Walks used as accessible routes to the building shall comply with the
          standards.

     (3)  An accessible primary entrance to the building shall be at grade or
          ramped to grade in accordance with the standards.
          ------

     (4)  An accessible entrance to the building shall comply with the
          standards.

     (5)  At least one accessible route (corridors and doors) to the demised
          premises shall comply with the standards.

     (6)  If support areas within the building (e.g., lunch rooms, cafeteria,
          etc.) are used by Lessee, its employees or the public, such areas
          shall be accessible.
<PAGE>

     (7)  If Lessee occupies floors others than the main floor of access to the
          building, at least one accessible elevator shall be provided.

     (8)  Accessible public rest rooms for each sex shall be provided,
          preferably on all floors.  As a minimum, accessible rest rooms shall
          be provided on the ground floor or the floor occupied by Lessee if the
          building is four stories or less in height.  If Lessee occupies an
          area above the fourth floor, accessible public rest rooms for each sex
          shall be provided on the floor occupied by Lessee.  If Lessee occupies
          more than one floor, at lease one accessible public rest room for each
          sex shall be provided on at least every fourth floor occupied by
          Lessee.

     (9)  All corridors, doors and spaces in or about the demised premises and
          used by the public or employees of Lessee shall be accessible.

     (10) Directional signs complying with the standards shall be provided
          directing the public to the demised premises occupied by Lessee.

     (11) Where the foregoing standards for accessibility by the disabled
          conflict with or are superseded by state, federal or local laws,
          ordinances, rules, or regulations setting forth standards for access
          by the disabled, the more favorable standards for accessibility by the
          disabled shall govern.

5.   DELIVERY OF POSSESSION:

     (A)  Lessor covenants to deliver quiet possession of the demised premises
at the commencement of the initial term.

     (B)  Lessor covenants to deliver the demised premises to Lessee at the
commencement of the initial term in good repair and condition, suitable to the
purpose and use for which the demised premises are leased.  Lessor warrants that
all plumbing, heating, air conditioning, electrical and mechanical devices and
appliances of every kind or nature located upon or serving the demised premises
shall be in good repair, condition and working order as of the commencement of
the initial term.

     (C)  Lessor covenants that the demised premises and the building of which
the demised premises forms a part have been inspected by an Asbestos Inspector
licensed by the Virginia Department of Professional and Occupational Regulations
and the building is free of friable asbestos that is not managed under a
management plan prepared by an Asbestos Management Planner licensed by the
Virginia Department of Professional and Occupational Regulation.
<PAGE>

     (D)  Prior to occupancy by Lessee, Lessor shall complete to the
satisfaction of Lessee the interior finish of the demised premises, including
installation of any equipment, Fixtures and furnishings, in compliance with the
Lessor's work letter attached hereto as Exhibit ________.

6.   MAINTENANCE:

     (A)  Lessor covenants to keep, repair and Maintain, at Lessor's expense,
the demised premises and all plumbing, heating, air conditioning, electrical and
mechanical devices, appliances and equipment of every kind or nature affixed to
or serving the demised premises in good repair, condition and working order,.
suitable to the purpose and use for which Lessee has leased same, during the
initial term and any renewal terms and, if necessary, shall make such
alterations, additions and /or modifications of the demised premises and all
equipment, electrical and mechanical devices and appliances thereon or serving
same so as to comply -at all times with all applicable federal, State and local
laws, ordinances, rules and regulations pertaining to health, safety, fire and
public welfare. As used herein, the word 'repair" shall be deemed to include
replacement of broken or cracked glass.

     (B)  If Lessor fails to keep, repair and maintain the demised premises and
all plumbing, heating, air conditioning, electrical and mechanical devices,
appliances and equipment of every kind or nature affixed to or serving the
demised premises in good repair, condition and working order as provided in sub-
paragraph 6(A), then Lessee, at its option, may either (a) immediately terminate
this lease and all obligations hereunder, or (b) proceed to make, or cause to be
made, such upkeep, repair and/or maintenance, at Lessor's expense, so as to
render the demised premises suitable for the purpose and use for which same are
leased, in which event, Lessee may deduct the cost of same from future rent
installments as they become due and/or may collect such cost from Lessor in any
manner provided by law.

     (C)  Lessor covenants to keep and maintain the demised premises and the
building of which the demised premises forms a part free of friable asbestos and
any other adverse environmental condition which is deemed hazardous- to the
health or safety of persons entering the building.  Lessor covenants to
indemnify, defend and hold the Lessee and the Commonwealth of Virginia harmless
from and against any claims of injury resulting from the presence of friable
asbestos or any other adverse environmental condition which is deemed hazardous
to the health or safety or persons entering the building.

7.   UTILITIES:

Lessor shall provide, at Lessor's expense, all heating and air conditioning as
conditions require, electricity, water, sewage and trash disposal,
xxxxxxxxxxxxxxxx, to and for the demised premises during the initial term and
any renewal terms. In the event that any one or more such utilities are not
provided or are reduced, other than due to causes beyond the reasonable control
of Lessor, and the failure to provide or reduction of same renders the demised
premises unsuitable for the purpose and use for which the premises are leased,
then Lessee, in addition to
<PAGE>

any other remedy available at law or equity, shall be entitled to deduct from
the total rent, or any installment thereof, the per them rental for each day
that the demised premises are rendered unsuitable due to the failure to provide
or reduction of such utilities.

8.   ALTERATIONS BY LESSEE:

Lessee may make such alterations, modifications, additions and/or improvements
upon or to the demised premises and may install or remove such fixtures and
partitions as Lessee may deem proper; provided, however, that any structural
alterations of the roof, foundation or exterior walls shall require the prior
written consent of Lessor. All materials used in such alterations,
modifications, additions or improvements, and all fixtures' and partitions made
and/or installed by Lessee shall remain the property of Lessee and, upon
termination of this lease, may, at Lessee's option, be removed.

9.   DAMAGE OR DESTRUCTION OF DEMISED PREMISES:

     (A)  If the demised premises are damaged by fire or other casualty so as to
render same, in the opinion of Lessee, untenantable for the purpose or use for
which Lessee has leased same, this lease, and all obligations hereunder, shall
immediately terminate upon Lessee's giving notice of that fact to Lessor by
certified or registered mail, return receipt requested, as hereinafter provided.

     (B)  If the demised premises are damaged by fire or other casualty, but not
so as to render same untenantable, in the opinion of Lessee, for the purpose or
use for which Lessee has leased the demised premises, upon being so notified by
Lessee by certified or registered mail, return receipt requested, Lessor shall
repair and restore within a reasonable time, at Lessor's expense, the demised
premises to its former condition. La this event, the rent shall be adjusted on a
pro rata basis for the period of such repair and restoration for that portion of
the premises rendered untenantable for Lessee by the fire or other casualty. As
used herein, the words "repair' and "restore" shall be deemed to mean and
include replacement of broken, cracked or damaged glass or windows.

     (C)  If Lessor fails to make or fails to complete repair and restoration of
the demised premises within a reasonable time after Lessee provides notice
pursuant to sub-paragraph 9(B), then Lessee, at its option, may either (a)
immediately terminate this lease and all obligations hereunder, or (b) proceed
to make, or cause to be made, such repair and restoration, at Lessor's expense,
in which event, Lessee may deduct the cost of same from future rent installments
as they become due and/or may collect such cost from Lessor in any manner
provided by Law.
<PAGE>

10.  RENEWAL OF LEASE:

     Unless otherwise terminated as herein provided, at the end of the initial
term this lease shall automatically renew and continue in full force and effect
from year to year ("renewal term") at the same rental, adjusted pro rata on an
annual basis and due and payable in the same periodic installments as provided
in paragraph 2, and subject to all terms, conditions, covenants, promises and
agreements herein contained.  Such year-to-year or renewal term shall continue
to renew automatically unless terminated by either party in such manner and at
such time as hereinafter provided for termination of the initial term.

11.  TERMINATION:

     (A)  This lease and any renewal term of this lease may be terminated by
either party only upon written notice to the other party by certified or
registered mail, return receipt requested, at least three (3) months prior to
the expiration of the initial term or any renewal term; otherwise, this lease
shall renew and continue as provided in paragraph 10.  In addition, during any
renewal term, Lessee, at its option, may terminate this lease at any time upon
at least three (3) months written notice to Lessor by certified or registered
mail, return receipt requested.

     (B)  Agencies of the Commonwealth of Virginia cannot expend funds unless
appropriated by the Virginia General Assembly and may not obligate a future
session of the Virginia General Assembly.  Therefore, notwithstanding any
provision in this lease to the contrary, if any session of the Virginia General
Assembly fails to appropriate funds for the continuance of this lease or the
federal government fails to appropriate or allocate sufficient funds for the
purpose of continuation of this lease, the lease and all obligations hereunder
shall automatically terminate upon depletion of the then currently appropriated
or allocated funds.

     (C)  Notwithstanding any provision in this lease to the contrary, if, by
operation of law, the leasing agency designated in paragraph 3 shall cease to
exist or it powers and authority are limited so as not to permit the continued
use of the demised premises for the purpose and use for which same is leased,
then this lease and all obligations of Lessee hereunder shall terminate.

12.  NOTICE:

     (A)  Any and all notices affecting this lease may be served by the parties
hereto, or by their duly authorized agents, as effectively as if same were
served by any officer authorized by law to serve such notices.  The return of
such party, or its duly authorized agent, showing the time, place and manner of
service of such notice shall have the same force and effect in any legal
proceedings based thereon as a return of service by any officer authorized by
law to serve such notice.

     (B)  All notices required by law to be served upon and all notices
permitted by this lease to be mailed to a party to this lease shall be served
upon or mailed to, as the case may be,
<PAGE>

the following agents for each party who are hereby appointed and designated as
such for the purpose of receiving all such notices:

     (1)  Lessor's agent shall be Clark Owen, Jr., President, whose address is
                                  --------------------------
     220 E. Main Street, Salem, Virginia 24153.
     ------------------------------------------

     (2)  Lessee's agent shall be Molly L. Rutledge, M. D., District Director,
                                  --------------------------------------------
     whose address is Roanoke County Salem Health Department, 105 E. Calhoun
                      ------------------------------------------------------
     Street, Salem, Virginia 241.53.
     -------------------------------

     Each party shall immediately notify the other party, in writing, of any
change of agents, and no change of agents shall be effective until such notice
is given.

     (C)  Where under the terms of this lease a notice is required or permitted
to be mailed by certified or registered mail, return receipt requested, and such
notice is not mailed in such manner, the notice shall be effective if actually
waived by the party, or its appointed agent, to whom the notice is directed.

13.  BINDING UPON SUCCESSORS:

     (A)  This lease shall be binding upon the parties hereto and their
successors in interests, including but not limited to heirs, assigns, purchasers
at lien, deeds of trust, or mortgage foreclosure.

     (B)  In the event of foreclosure of the Deed of Trust prior to the
expiration of this Lease according to its terms, including any extensions and
renewals thereof, Lender or any other successor in interest of the Landlord
shall take title to the demised premises subject to the terms, covenants,
agreements and conditions of this Lease, and Tenant's quiet and peaceful
possession and enjoyment of the demised premises shall not be disturbed.

14.  ENTIRE AGREEMENT:

     This written Deed of Lease constitutes the entire, full and complete
understanding and agreement of the parties, and all representations, conditions,
statements, warranties, covenants, promises or agreements previously made or
given by either party to the other are hereby expressly merged into this written
Deed of Lease and shall be null, void. and without legal effect.

15.  MODIFICATION:

     Ms Deed of Lease shall not be modified, altered or amended except by
written agreement executed by the parties hereto with the same formality as this
agreement.
<PAGE>

16.  PARAGRAPH HEADINGS:

     Headings to the paragraphs are mere catchwords and are illustrative only;
they do not form a part of this lease nor are they intended to be used in
construing same.

17.  ADDITIONAL PROVISIONS:

     This lease is subject to the terms, conditions, modifications, additions
and/or deletions provided in the following designated attachments which are
incorporated herein by reference: [Designate as "Attachment No. 1," etc.  If
none, state "NONE."]

18.  EXECUTION:

     Ms Deed of Lease shall not be effective or binding unless and until signed
by both parties and, where required by law, approved by the Governor of Virginia
pursuant to (S)2.1-504.2 of the Code of Virginia (1950), as amended.

     In WITNESS WHEREOF, the parties have affixed their signatures and seals.

                                   LESSOR:_______________________________
                                                  (Type or print name)

                                   By:___________________________________
                                                  (Signature) (Title)

                                   LESSEE: COMMONWEALTH OF VIRGINIA
                                   VIRGINIA DEPARTMENT OF HEALTH

                                   By:___________________________________
                                                  (Signature)

                                   ______________________________________
                                                  (Title)
<PAGE>

COMMONWEALTH OF VIRGINIA

CITY / COUNTY OF Roanoke to-wit:
                 -------

     The foregoing Deed of Lease was acknowledge before me
     by Clarke Owen, Jr. on the 30th day of June, 1995 in the jurisdiction
        ----------------        ----        ----    --
     aforesaid

     My commission expires: January 31, 1996
                            ----------------

                                             ___________________________________
                                                         Notary Public

COMMONWEALTH OF VIRGINIA

CITY / COUNTY Roanoke to-wit:
              -------

     The foregoing Deed of Lease was acknowledge before me
     by Molly L. Rutledge on the 5/th/ day of July, 1995 in the jurisdiction
        -----------------        -----        ----    --
     aforesaid.

     My commission expires January 31, 1996
                           ----------------

                                             ___________________________________
                                                         Notary Public

RECOMMEND APPROVAL:                          RECOMMEND APPROVAL:

DIVISION OF ENGINEERING AND                  DEPARTMENT OF GENERAL SERVICES

BUILDINGS

By:________________________                  By:____________________________
          Director                                         Director
APPROVED BY THE GOVERNOR

     Pursuant to (S) 2.1-504.2 of the Code of Virginia (1950), as amended, and
by the authority delegated to me under Executive Order _______________________,
dated ___________ 19____, I hereby approve the acquisition of the demised
premises pursuant to this Deed of Lease and the execution of this instrument for
and on behalf of the Governor of Virginia.

                                             ___________________________________
                                              Secretary of Administration (Date)

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