EXHIBIT 10.8
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Agreement, made and dated as of September 18, 2007, is by
and
between MFB FINANCIAL, a federal savings association ("EMPLOYER"),
and TERRY L.
CLARK, a resident of St. Joseph County, Indiana ("EMPLOYEE"), but
effective as
of January 16, 2007.
This Agreement amends and restates the prior Employment
Agreement
between Employer and the Employee dated January 16, 2007 (the
"Prior
Agreement"). It has been amended and restated for compliance with
the final
regulations under Section 409A of the Internal Revenue Code of
1986, as amended,
effective as of January 16, 2007.
W I T N E S S E T H:
WHEREAS, Employee is hereby employed by Employer as its Executive
Vice
President and Chief Financial Officer, and is expected to make
valuable
contributions to the profitability and financial strength of
Employer;
WHEREAS, Employer desires to encourage Employee to make
valuable
contributions to Employer's business operations and not to seek or
accept
employment elsewhere;
WHEREAS, Employee desires to be assured of a secure minimum
compensation from Employer for his services over a defined
term;
WHEREAS, Employer desires to assure the continued services of
Employee
on behalf of Employer on an objective and impartial basis and
without
distraction or conflict of interest in the event of an attempt by
any person to
obtain control of Employer or of MFB Corp., the Indiana corporation
which owns
all of the issued and outstanding capital stock of Employer (the
"Holding
Company");
WHEREAS, Employer recognizes that when faced with a proposal for
a
change of control of Employer or the Holding Company, Employee will
have a
significant role in helping the Boards of Directors assess the
options and
advising the Boards of Directors on what is in the best interests
of Employer,
the Holding Company, and its shareholders, and it is necessary for
Employee to
be able to provide this advice and counsel without being influenced
by the
uncertainties of his own situation;
WHEREAS, Employer desires to provide fair and reasonable benefits
to
Employee on the terms and subject to the conditions set forth in
this Agreement;
WHEREAS, Employer desires reasonable protection of its
confidential
business and customer information which it has developed over the
years at
substantial expense and assurance that Employee will not compete
with Employer
for a reasonable period of time after termination of his employment
with
Employer, except as otherwise provided herein.
NOW, THEREFORE, in consideration of these premises, the mutual
covenants and undertakings herein contained and the continued
employment of
Employee by Employer as its Executive Vice President and Chief
Financial
Officer, Employer and Employee, each intending to be legally bound,
covenant and
agree as follows:
1. Upon the terms and subject to the conditions set forth in this
Agreement,
Employer employs Employee as Employer's Executive Vice President
and Chief
Financial Officer, and Employee accepts such employment.
2. Employee agrees to serve as Employer's Executive Vice President
and Chief
Financial Officer and to perform such duties in that office as may
reasonably be
assigned to him by Employer's Board of Directors; provided, however
that such
duties shall be performed in or from the offices of Employer
currently located
at Mishawaka, Indiana, and shall be of the same character as those
previously
performed by Employee's predecessor and generally associated with
the office
held by Employee. Employee shall not be required to be absent from
the location
of the principal executive offices of Employer on travel status or
otherwise
more than 45 days in any calendar year. Employer shall not, without
the written
consent of Employee, relocate or transfer Employee to a location
more than 30
miles from his principal residence. Although while employed by
Employer,
Employee shall devote substantially all his business time and
efforts to
Employer's business and shall not engage in any other related
business, Employee
may use his discretion in fixing his hours and schedule of work
consistent with
the proper discharge of his duties.
3. The term of this Agreement shall begin on January 16, 2007 (the
"EFFECTIVE
DATE"), and shall end on January 16, 2008; provided, however, that
such term
shall be extended for an additional month on the first day of each
month
succeeding the Effective Date, so as to continue to maintain a
one-year term and
shall continue to be so extended if Employer's Board of Directors
determines by
resolution to extend this Agreement prior to each anniversary of
the Effective
Date. If either party hereto gives written notice to the other
party not to
extend this Agreement in any given month or if the Board does not
determine to
extend the Agreement prior to each anniversary of the Effective
Date, no further
extension shall occur and the term of this Agreement shall end one
year
subsequent to the first day of the month in which such notice not
to extend is
given or one year subsequent to the anniversary as of which the
Board does not
elect to continue extending this Agreement (such term, including
any extension
thereof shall herein be referred to as the "TERM"). Notwithstanding
the
foregoing, this Agreement shall automatically terminate (and the
Term of this
Agreement shall thereupon end) without notice when Employee attains
65 years of
age.
4. From and after the date hereof, Employee shall receive an annual
salary of
$105,000 ("BASE COMPENSATION") payable at regular intervals in
accordance
with Employer's normal payroll practices now or hereafter in
effect. Employer
may consider and declare from time to time increases in the salary
it pays
Employee and thereby increases in his Base Compensation. Employer
may also
declare incentive bonuses from time to time to be paid to Employee
in addition
to his annual salary. During the Term of this Agreement, but only
until such
time as a Change in Control occurs, Employer may also declare
decreases in the
salary it pays Employee if the operating results of Employer are
significantly
less favorable than those for the fiscal year ending September 30,
2006, and
Employer makes similar decreases in the salary it pays to other
executive
officers of Employer. After a Change in Control, no such decreases
in Base
Compensation may be made, and Employer shall consider and declare
salary
increases based upon the following standards:
Inflation;
Adjustments to the salaries of other senior management personnel;
and
Past performance of Employee and the contribution which Employee
makes
to the business and profits of Employer during the Term.
Any and all increases or decreases in Employee's salary pursuant to
this section
shall cause the level of Base Compensation to be increased or
decreased by the
amount of each such increase or decrease for purposes of this
Agreement. The
increased or decreased level of Base Compensation as provided in
this section
shall become the level of Base Compensation for the remainder of
the Term of
this Agreement until there is a further increase or decrease in
Base
Compensation as provided herein.
5.
So long as Employee is employed by Employer
pursuant to this Agreement and subject to
any waiting period requirements in such
plans, he shall be included as a participant
in all present and future employee benefit,
retirement, and compensation plans generally
available to employees of Employer (other
than Employer's recognition and retention
plan and trust), consistent with his Base
Compensation and his position as Executive
Vice President and Chief Financial Officer
of Employer, including, without limitation,
Employer's or the Holding Company's
retirement plan, stock option plan, employee
stock ownership plan, and hospitalization,
major medical, disability, dental and group
life insurance plans, each of which Employer
agrees to continue in effect on terms no
less favorable than those currently in
effect as of the date hereof (as permitted
by law) during the Term of this Agreement
unless prior to a Change in Control the
operating results of Employer are
significantly less favorable than those for
the fiscal year ending September 30, 2006,
and unless (either before or after a Change
in Control) changes in the accounting or tax
treatment of such plans would adversely
affect Employer's operating results or
financial condition in a material way, and
the Board of Directors of Employer or the
Holding Company concludes that modifications
to such plans need to be made to avoid such
adverse effects.
6.
So long as Employee is employed by Employer
pursuant to this Agreement, Employee shall
receive reimbursement from Employer for all
reasonable business expenses incurred in the
course of his employment by Employer, upon
submission to Employer of written vouchers
and statements for reimbursement. Employee
shall attend, at his discretion, those
professional meetings, conventions, and/or
similar functions that he deems appropriate
and useful for purposes of keeping abreast
of current developments in the industry
and/or promoting the interests of Employer.
So long as Employee is employed by Employer
pursuant to the terms of this Agreement,
Employer shall continue in effect vacation
policies applicable to Employee no less
favorable from his point of view than those
written vacation policies in effect on the
date hereof. So long as Employee is employed
by Employer pursuant to this Agreement,
Employee shall be entitled to an auto
allowance of $0 per month to be
applied towards the use or lease of an
automobile used in part for Employer
business.
7.
Subject to the respective continuing
obligations of the parties, including but
not limited to those set forth in
subsections 9(A), 9(B), 9(C) and 9(D)
hereof, Employee's employment by Employer
may be terminated prior to the expiration of
the Term of this Agreement as follows:
(A)
Employer, by action of its Board of
Directors and upon written notice to
Employee, may terminate Employee's
employment with Employer immediately for
cause. For purposes of this subsection 7(A),
"cause" shall be defined as (i) personal
dishonesty, (ii) incompetence, (iii) willful
misconduct, (iv) breach of fiduciary duty
involving personal profit, (v) intentional
failure to perform stated duties, (vi)
willful violation of any law, rule, or
regulation (other than traffic violations or
similar offenses) or final cease-and-desist
order, or (vii) any material breach of any
term, condition or covenant of this
Agreement.
(B)
Employer, by action of its Board of
Directors, may terminate Employee's
employment with Employer without cause at
any time; provided, however, that the "date
of termination" for
purposes of determining
benefits payable to Employee under
subsection 8(B) hereof shall be the date
which is 60 days after Employee receives
written notice of such termination.
(C) Employee,
by written
notice to Employer,
may terminate his
employment with
Employer immediately
for cause.
For
purposes of this
subsection
7(B), "cause" shall be
defined as (i) any action by Employer's Board of Directors
to remove the Employee as Executive Vice President and
Chief Financial
Officer of Employer,
except where the
Employer's Board of Directors properly acts to remove
Employee from such
office for "cause" as defined in
subsection 7(A)
hereof, (ii) any action by Employer's
Board
of Directors which Employee reasonably believes materially
limits, increases, or
modifies Employee's
duties and/or
authority as Executive Vice President and Chief Financial
Officer of Employer
(including his authority, subject to
corporate controls no
more restrictive than
those in effect
on the date hereof, to
hire and discharge
employees who are
not bona fide officers
of Employer), (iii)
any failure of
Employer to obtain the
assumption of the
obligation to
perform this
Agreement by any successor or the
reaffirmation of
such obligation by
Employer, as
contemplated in
section 20 hereof; or
(iv) any material
breach by Employer of a term, condition or covenant of this
Agreement.
(D)
Employee, upon sixty (60) days written
notice to Employer, may terminate his
employment with Employer without cause.
(E)
Employee's employment with Employer shall
terminate in the event of Employee's death
or disability. For purposes hereof,
"disability" shall be defined as Employee's
inability by reason of illness or other
physical or mental incapacity to perform the
duties required by his employment for any
consecutive One Hundred Eighty (180) day
period, provided that notice of any
termination by Employer because of
Employee's "disability" shall have been
given to Employee prior to the full
resumption by him of the performance of such
duties.
8.
In the event of termination of Employee's
employment with Employer pursuant to section
7 hereof, compensation shall continue to be
paid by Employer to Employee as follows:
(A) In the
event of termination
pursuant to subsection 7(A) or 7(D),
compensation provided
for herein (including Base
Compensation) shall
continue to be paid, and Employee
shall continue
to participate in the
employee benefit,
incentive bonus,
retirement, and
compensation plans
and
other perquisites
as provided in sections 5 and 6 hereof,
through the date of
termination specified
in the notice
of termination.
Any benefits payable under insurance,
health, retirement and
bonus plans as a result of Employee's
participation in such
plans through such date shall be paid
when due under those plans. The date of termination
specified in any notice of termination pursuant to
Subsection 7(A) shall
be no later than the last business day
of the month in which such notice is provided to Employee.
(B) In the
event of termination
pursuant to subsection 7(B) or 7(C),
compensation provided
for herein (including Base
Compensation) shall
continue to be paid, and Employee
shall continue
to participate in the
employee benefit,
incentive bonus,
retirement, and
compensation plans
and
other perquisites
as provided in sections 5 and 6 hereof,
through the date of
termination specified
in the notice
of termination.
Any benefits payable under insurance,
health, retirement and
bonus plans as a result of Employee's
participation in such
plans through such date shall be paid
when due under those
plans. In addition, Employee shall
be entitled
to continue to receive
from Employer his Base
Compensation at the
rate in effect at the time of
termination, plus
any incentive bonus he received for
the tax year
preceding the date of termination
for the
remaining Term of the
Agreement if the termination does
not follow a Change in Control. In addition, during such
period, Employer
will maintain in full force and effect
for
the continued
benefit of
Employee each employee welfare
benefit plan and each
employee pension
benefit plan (as
such terms are defined
in the Employee
Retirement
Income
Security Act of 1974,
as amended) in which
Employee was
entitled to
participate
immediately prior to the date of
his termination,
unless an essentially equivalent and no
less favorable benefit is provided by a subsequent employer
of Employee. If the
terms of any employee
welfare
benefit plan or
employee pension
benefit plan of Employer
or applicable
laws do not permit
continued
participation
by Employee,
Employer will arrange to provide to Employee
a benefit substantially similar to, and no less
favorable
than, the benefit he
was entitled to
receive under such
plan at the end of the period of coverage.
(C)
In the event of
termination
pursuant to subsection
7(E),
compensation provided
for herein (including
Base
Compensation) shall
continue to be paid, and Employee shall
continue to participate in the employee benefit, incentive
bonus, retirement,
and compensation plans
and other
perquisites as provided in sections 5 and 6 hereof, (i) in
the event of Employee's death, through the date of death, or
(ii) in the event of
Employee's disability,
through the
date of proper
notice of disability
as required by
subsection 7(D).
Any benefits payable under insurance,
health, retirement and
bonus plans as a result of Employer's
participation in such
plans through such
date shall be paid when due under those plans.
(D) Employer
will permit Employee or his personal representative(s)
or heirs, during a
period of three months
following
Employee's termination
of employment by Employer for the
reasons set forth in subsections 7(B) or 7(C), if such
termination follows a
Change in Control, to require Employer,
upon written request,
to purchase all outstanding stock
options previously
granted to Employee
under any Holding
Company stock option plan then in effect whether or not such
options are then exercisable or have terminated at a cash
purchase price
equal to the
amount by which the
aggregate "fair
market value" of the shares subject to
such options
exceeds the aggregate option price for
such
shares. For purposes
of this Agreement,
the term "fair
market value" shall
mean the higher of (1) the average of the
highest asked prices for Holding Company shares in the
over-the-counter
market as reported
on the NASDAQ system
if the shares are traded on such system for the 30 business
days preceding
such termination, or (2) the average per
share price actually
paid for the most
highly priced 1%
of the Holding Company
shares acquired in connection with
the Change in Control of the Holding Company by any person
or group acquiring such control.
(E)
For purposes of this Agreement, a
