EXHIBIT 10.1

MANAGEMENT CONTINUITY AGREEMENT

        THIS IS AN AGREEMENT between FNBH BANCORP, INC. (the “Corporation”),
whose principal offices are 101 E. Grand River Ave., Howell, Michigan 48843, and
Nancy Morgan (the “Executive”), effective June 7, 2007.

RECITALS

        The Executive is a key officer of the Corporation or a Subsidiary whose
continued dedication, availability, advice and counsel to the Corporation and
its Subsidiaries is deemed important to the Board of Directors of the
Corporation (“Board”), the Corporation and its shareholders. The services of the
Executive, her experience and knowledge of the affairs of the Corporation and
her reputation and contacts in the industry are extremely valuable to the
Corporation. The Corporation wishes to attract and retain such well-qualified
executives, and it is in the best interests of the Corporation to secure the
continued services of the Executive notwithstanding any change in control of the
Corporation.

        The Corporation considers the establishment and maintenance of a sound
and vital management team to be part of its overall corporate strategy and to be
essential to protecting and enhancing the best interests of this Corporation and
its shareholders. Accordingly, the Board has approved this Agreement with the
Executive and authorized its execution and delivery on behalf of the
Corporation.

AGREEMENT

        1.        Term of Agreement. This Agreement will begin on the date
entered above (the “Commencement Date”) and will continue in effect through June
7, 2010 (the “Initial Term”). Thereafter, this Agreement shall be extended
automatically for an additional one (1) year period (“Renewal Terms”) at the end
of the Initial Term and each Renewal Term, unless not later than three (3)
months prior to the end of the Initial Term or a Renewal Term, either the
Corporation or the Executive gives written notice to the other party that she or
it has elected not to renew this Agreement. Notwithstanding the foregoing, if a
Change of Control (as defined below) occurs during the term of this Agreement,
this Agreement will continue in effect for twelve (12) months beyond the end of
the month in which any Change of Control occurs.

        2.        Definitions. The following defined terms shall have the
meanings set forth below, for purposes of this Agreement:

        (a)        Average Base Salary. Average Base Salary shall mean the
Executive’s highest annual salary during the three (3) calendar year period
beginning two (2) years immediately prior to the year of Change of Control and
ending with the year in which the Change of Control occurred; provided that if
Executive has been employed by the Corporation or a Subsidiary for less than
three (3) years, Average Base Salary shall be the highest annual salary during
that lesser period or if less than one year, the Executive’s prevailing salary
shall be annualized.

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        (b)        Average Bonus. Average Bonus shall mean the highest of the
last three (3) bonuses paid to Executive under the Corporation’s Profit Sharing
Plan immediately preceding the Change of Control; provided that (i) if Executive
has been employed by the Corporation or a Subsidiary for less than three (3)
years, Average Bonus shall be the highest bonus paid during that lesser period,
and (ii) if Executive has been employed by the Corporation or a Subsidiary for
less than one (1) year, Average Bonus shall be Executive’s total guaranteed
bonus, if any, for that year.

        (c)        Change of Control. A “Change in Control” shall mean a change
in control of the Corporation of such a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934 (“Exchange Act”), or such item thereof
which may hereafter pertain to the same subject; provided that, and
notwithstanding the foregoing, a Change in Control shall be deemed to have
occurred if:

        (i)        Any “person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Corporation representing twenty-five percent (25%) or more of the combined
voting power of the Corporation’s then outstanding securities; or

        (ii)        At any time a majority of the Board of Directors of the
Corporation is comprised of other than Continuing Directors (for purposes of
this paragraph, the term Continuing Director means a director who was either (A)
first elected or appointed as a Director prior to the date of this Agreement; or
(B) subsequently elected or appointed as a director if such director was
nominated or appointed by at least a majority of the then Continuing Directors);
or

        (iii)        Any of the following occur:

    (A)        Any merger or consolidation of the Corporation, other than a
merger or consolidation in which the voting securities of the Corporation
immediately prior to the merger or consolidation continue to represent (either
by remaining outstanding or being converted into securities of the surviving
entity) fifty-one percent (51%) or more of the combined voting power of the
Corporation or surviving entity immediately after the merger or consolidation
with another entity;

    (B)        Any sale, exchange, lease, mortgage, pledge, transfer, or other
disposition (in a single transaction or a series of related transactions) of all
or substantially all of the assets of the Corporation which shall include,
without limitation, the sale of assets or earning power aggregating more than
fifty percent (50%) of the assets or earning power of the Corporation on a
consolidated basis;

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    (C)        Any liquidation or dissolution of the Corporation;

    (D)        Any reorganization, reverse stock split, or recapitalization of
the Corporation which would result in a Change of Control; or

    (E)        Any transaction or series of related transactions having,
directly or indirectly, the same effect as any of the foregoing; or any
agreement, contract, or other arrangement providing for any of the foregoing.

        (d)        Disability. “Disability” means that, as a result of
Executive’s incapacity due to physical or mental illness, the Executive shall
have been found to be eligible for the receipt of benefits under the
Corporation’s long term disability plan.

        (e)        Cause. “Cause” means (i) the willful commission by the
Executive of a criminal or other act that causes or will probably cause
substantial economic damage to the Corporation or a Subsidiary or substantial
injury to the business reputation of the Corporation or a Subsidiary; (ii) the
commission by the Executive of an act of fraud in the performance of such
Executive’s duties on behalf of the Corporation or a Subsidiary; (iii) the
continuing willful failure of the Executive to perform the duties of such
Executive to the Corporation or a Subsidiary (other than any such failure
resulting from the Executive’s Disability or occurring after issuance by
Executive of a Notice of Termination for Good Reason) after written notice
thereof (specifying the particulars thereof in reasonable detail) and a
reasonable opportunity to be heard and cure such failure are given to the
Executive by the Board; or (iv) the order of a federal or state bank regulatory
agency or a court of competent jurisdiction requiring the termination of the
Executive’s employment. For purposes of this subparagraph, no act, or failure to
act, on the Executive’s part shall be deemed “willful” unless done, or omitted
to be done, by the Executive not in good faith and without reasonable belief
that the action or omission was in the best interest of the Corporation or a
Subsidiary.

        (f)        Good Reason. For purposes of this Agreement, “Good Reason”
means the occurrence of any one or more of the following without the Executive’s
express written consent:

        (i)        The assignment to Executive of duties which are materially
different from or inconsistent with the duties, responsibilities and status of
(a) Executive’s position at any time during the six (6) month period prior to
the Change of Control of the Corporation, or (b) which result in a significant
reduction in Executive’s authority and responsibility as an executive of the
Corporation or a Subsidiary;

        (ii)        A reduction by the Corporation in Executive’s base salary or
salary grade as of the day prior to the Change of Control, or the failure to
grant salary increases and bonus payments on a basis comparable to those granted
to other executives of the Corporation, or reduction of Executive’s most recent
incentive bonus potential prior to the Change of Control under the Corporation’s
Management Incentive Compensation Plan, or any complementary or successor plan;

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        (iii)        Either (a) the Corporation requiring Executive to be based
at a location in excess of twenty-five (25) miles from the location where
Executive is currently based, or (b) in the event of any relocation of the
Executive with the Executive’s express written consent, the failure of the
Corporation or a Subsidiary to pay (or reimburse the Executive for) all
reasonable moving expenses by the Executive relating to a change of principal
residence in connection with such relocation and to pay the Executive the amount
of any loss realized in the sale of the Executive’s principal residence in
connection with any such change of residence. Any gain realized upon the sale
shall not offset the obligation to pay moving expenses, and the amounts payable
under (b) shall be tax effected, all to the effect that the Executive shall
incur no loss on an after tax basis;

        (iv)         The failure of the Corporation to obtain a satisfactory
agreement from any successor to the Corporation to assume and agree to perform
this Agreement, as contemplated in Paragraph 5 hereof;

        (v)         Any termination by the Corporation of Executive’s employment
that is other than for Cause;

        (vi)        Any termination of Executive’s employment, reduction in
Executive’s compensation or benefits, or adverse change in Executive’s location
or duties, if such termination, reduction or adverse change (aa) occurs within
six (6) months before a Change of Control, (bb) is in contemplation of such
Change in Control, or (cc) is taken to avoid the effect of this Agreement should
such action occur after such Change in Control; or

        (vii)        The failure of the Corporation to provide the Executive
with substantially the same fringe benefits (including, without limitation,
retirement plan, health care, insurance, and paid vacations) that were provided
to her immediately prior to the Change in Control, or with a package of fringe
benefits that, though one or more of such benefits may vary from those in effect
immediately prior to such Change in Control, is substantially comparable in all
material respects to such fringe benefits taken as a whole.

          The existence of Good Reason shall not be affected by Executive’s
Disability. Executive’s continued employment shall not constitute a waiver of
Executive’s rights with respect to any circumstance constituting Good Reason
under this Agreement.

        (g)        Notice of Termination. “Notice of Termination” means a
written notice indicating the specific termination provision in this Agreement
relied upon and setting forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the employment under the provision
so indicated. The Executive shall not be entitled to give a Notice of
Termination that the Executive is terminating employment for Good Reason more
than six (6) months following the occurrence of the event alleged to constitute
Good Reason, except with respect to an event which occurred before the Change of
Control, in which case the Notice of Termination must be given within six (6)
months following the Change of Control. Any termination by the Corporation for
Cause or due to Executive’s Disability, or by Executive for Good Reason shall be
communicated by Notice of Termination to the other party.

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        (h)        Subsidiary. “Subsidiary” means a corporation with at least
eighty percent (80%) of its outstanding capital stock owned directly or
indirectly by the Corporation.

        3.        Eligibility for Severance Benefits. The Executive shall
receive the Severance Benefits described in Paragraph 4 if the Executive’s
employment is terminated during the term of this Agreement, and

        (a)        The termination occurs within twelve (12) months after a
Change of Control, unless the termination is (i) because of Executive’s death or
Disability, (ii) by the Corporation for Cause, or (iii) by the Executive other
than for Good Reason; or

        (b)        The Corporation terminates the employment of Executive within
six (6) months before a Change of Control, in contemplation of such Change of
Control, and to avoid the effect of this Agreement should such action occur
after such Change of Control.

        4.        Severance Benefits. The Executive shall receive the following
Severance Benefits (in addition to accrued compensation and vested benefits) if
eligible under Paragraph 3:

        (a)        A lump sum cash amount (which shall be paid not later than
thirty (30) days after the date of termination of employment) equal to
Executive’s Average Base Salary, multiplied by one (1);

        (b)        A lump sum cash amount (which shall be paid not later than
thirty (30) days after the date of termination of employment) equal to the
Executive’s Average Bonus, multiplied by one (1);

        (c)        For the twelve (12) month period after the date the
employment is terminated, the Corporation will arrange to provide to Executive
at the Corporation’s expense, with:

        (i)        Health care coverage equal to that in effect for Executive
prior to the termination (or, if more favorable to Executive, that furnished
generally to salaried employees of the Corporation), including, but not limited
to, hospital, surgical, medical, dental, prescription and dependent coverages.
Health care benefits otherwise receivable by Executive pursuant to this
subparagraph 4(c) shall be reduced to the extent comparable benefits are
actually received by Executive from a subsequent employer during the twelve (12)
month period following the date the employment is terminated and any such
benefits actually received by Executive shall be reported to the Corporation;

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        (ii)        Life and accidental death and dismemberment insurance
coverage (including supplemental coverage purchase opportunity and double
indemnity for accidental death) equal (including policy terms) to that in effect
at the time Notice of Termination is given (or on the date the employment is
terminated if no Notice of Termination is required) or, if more favorable to
Executive, equal to that in effect at the date the Change of Control occurs; and

        (iii)        Disability insurance coverage (including policy terms)
equal to that in effect at the time Notice of Termination is given (or on the
date employment is terminated if no Notice of Termination is required) or, if
more favorable to Executive, equal to that in effect immediately prior to the
Change of Control; provided, however, that no income replacement benefits will
be payable under such disability policy with regard to the twelve (12) month
period following a termination of employment provided that the payments payable
under subparagraphs 4(a) and (b) above have been made.

        (d)        In computing and determining Severance Benefits under
subparagraphs 4(a) through (c) above, a decrease in Executive’s salary,
incentive bonus, or insurance benefits shall be disregarded if such decrease
occurs within six (6) months before a Change of Control, is in contemplation of
such Change of Control, and is taken to avoid the effect of this Agreement
should such action be taken after such Change of Control; in such event, the
salary, incentive bonus, and/or insurance benefits used to determine Average
Base Salary, Average Bonus, and therefore Severance Benefits shall be that in
effect immediately before the decrease that is disregarded pursuant to this
subparagraph 4(d);

        (e)        All previously awarded stock grants and stock options shall
immediately vest and become fully exercisable.

        (f)        Executive shall not be required to mitigate the amount of any
payment provided for in this Paragraph 4 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in this Paragraph 4
be reduced by any compensation earned by Executive as the result of employment
by another employer after the date the employment is terminated, or otherwise,
with the exception of a reduction in health insurance coverage as provided in
subparagraph 4(c)(i).

        5.        Successors; Binding Agreements. This Agreement shall inure to
the benefit of and be enforceable by Executive’s personal and legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. Executive’s rights and benefits under this Agreement may
not be assigned, except that if Executive dies while any amount would still be
payable to Executive hereunder if Executive had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement, to the beneficiaries designated by the Executive to
receive benefits under this Agreement in a writing on file with the Corporation
at the time of the Executive’s death or, if there is no such beneficiary, to
Executive’s estate. The Corporation will require any successor (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all of the business and/or assets of the Corporation (or of any
division or Subsidiary thereof employing Executive) to expressly assume and
agree to perform this Agreement in the same manner and to the same extent that
the Corporation would be required to perform it if no such succession had taken
place. Failure of the Corporation to obtain such assumption and agreement prior
to the effectiveness of any such succession shall be a breach of this Agreement
and shall entitle Executive to compensation from the Corporation in the same
amount and on the same terms to which Executive would be entitled hereunder if
Executive terminated the employment for Good Reason following a Change of
Control.

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        6.        Withholding of Taxes. The Corporation may withhold from any
amounts payable under this Agreement all federal, state, city, or other taxes as
required by law.

        7.        Covenant on Termination.

        (a)        In consideration of the Corporation’s delivery and execution
of this Agreement, the Executive agrees that during the term of her employment
by the Corporation or a Subsidiary, and for a period of twelve (12) consecutive
months immediately thereafter, the Executive shall not directly or indirectly,
within the Territory (defined below) engage, participate, invest or assist in
any commercial activity not owned by or affiliated with the Corporation that is
in competition with the Corporation or a Subsidiary involving banking or
financial or other services offered by the Corporation or a Subsidiary
(including, but not limited to, trust services) (“Competitive Business”) whether
as an owner, part-owner, stockholder, partner, director, officer, trustee,
employee, agent, consultant, or in any other capacity (except on behalf of the
Corporation or a Subsidiary). The foregoing covenant does not prohibit the
Executive from directly or indirectly owning up to an aggregate of five percent
(5%) of the outstanding stock of any publicly held company engaged in a
Competitive Business. The term “Territory” shall mean and include all of
Livingston County in the State of Michigan and any area located within a forty
(40) mile radius of any branch or office location of the Corporation or a
Subsidiary.

        (b)        Except as authorized or directed by the Corporation , the
Executive shall not, at any time during or subsequent to her employment by the
Corporation or a Subsidiary, directly or indirectly publish or disclose any
Confidential Information of the Corporation or a Subsidiary or Confidential
Information of others which has come into the Corporation’s or Subsidiary’s
possession or into her possession in the course of her employment with the
Corporation or a Subsidiary, to any person or entity, and the Executive shall
not use any such Confidential Information for her own personal use or advantage
or make it available to others for use.

        (c)        During the term of Executive’s employment by the Corporation
or a Subsidiary and for a period of twelve (12) consecutive months immediately
thereafter, the Executive shall not induce or attempt to induce any customer of
the Corporation or a Subsidiary (including any customer of the Corporation or a
Subsidiary during the nine (9) month period immediately preceding the date of
termination) to reduce its business with the Corporation or a Subsidiary or
solicit or attempt to solicit any employees of the Corporation or a Subsidiary
to leave the employ of the Corporation or any Subsidiary.

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        (d)        The Executive acknowledges that the restrictions contained
herein are reasonable and necessary to protect the business and interests of the
Corporation and that any violation of these restrictions will cause substantial
and irreparable injury to the Corporation, and as a consequence thereof, the
Executive agrees that the Corporation is entitled, in addition to any other
remedies, to preliminary and permanent injunctive relief to secure specific
performance, and to prevent a breach or contemplated breach, of this Agreement.
The restrictions set forth herein shall be construed as independent covenants,
and the existence of any claim or cause of action against the Corporation,
whether predicated upon this Agreement or otherwise, shall not constitute a
defense to the enforcement by the Corporation of the restrictions contained in
this Agreement.

        8.        Notice. For the purpose of this Agreement, notices and all
other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered or mailed by
United States registered mail, return receipt requested, postage prepaid,
addressed to the respective addressees set forth on the first page of this
Agreement, or at such other addresses as the parties may designate in writing.

        9.        Miscellaneous. No provision of this Agreement may be modified,
waived, or discharged unless such waiver, modification, or discharge is agreed
to in writing and signed by Executive and such officer as may be specifically
designated by the Board of Directors of the Corporation. The validity,
interpretation, construction, and performance of this Agreement shall be
governed by the laws of the State of Michigan.

        10.        Employment Rights. Except as specifically provided in this
Agreement, this Agreement shall not confer upon Executive any right to continue
in the employ of the Corporation or its Subsidiaries and shall not in any way
affect the right of the Corporation or its Subsidiaries to dismiss or otherwise
terminate Executive’s employment at any time with or without cause.

        11.        No Vested Interest. Neither Executive nor Executive’s
beneficiary shall have any right, title, or interest in any benefit under this
Agreement prior to the occurrence of the right to the payment thereof, or in any
property of the Corporation or its subsidiaries or affiliates.

        12.        Prior Agreements. This Agreement contains the understanding
between the parties hereto with respect to Severance Benefits in connection with
a Change of Control of the Corporation and supersedes any such prior agreement
between the Corporation (or any predecessor of the Corporation) and Executive.
If there is any discrepancy or conflict between this Agreement and any plan,
policy, or program of the Corporation regarding any term or condition of
Severance Benefits in connection with a Change of Control of the Corporation,
the language of this Agreement shall govern.

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        13.        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.        Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

        15.        Arbitration. The sole and exclusive method for resolving any
dispute arising out of this Agreement shall be arbitration in accordance with
this paragraph. Except as provided otherwise in this paragraph, arbitration
pursuant to this paragraph shall be governed by the Commercial Arbitration Rules
of the American Arbitration Association. A party wishing to obtain arbitration
of an issue shall deliver written notice to the other party, including a
description of the issue to be arbitrated. Within fifteen (15) days after either
party demands arbitration, the Corporation and the Executive shall each appoint
an arbitrator. Within fifteen (15) additional days, these two arbitrators shall
appoint the third arbitrator by mutual agreement; if they fail to agree within
said fifteen (15) day period, then the third arbitrator shall be selected
promptly pursuant to the rules of the American Arbitration Association for
Commercial Arbitration. The arbitration panel shall hold a hearing in Livingston
County, Michigan, within ninety (90) days after the appointment of the third
arbitrator. The fees and expenses of the arbitrator, and any American
Arbitration Association fees, shall be paid by the Corporation. Both the
Corporation and the Executive may be represented by counsel and may present
testimony and other evidence at the hearing. Within ninety (90) days after
commencement of the hearing, the arbitration panel will issue a written
decision; the majority vote of two of the three arbitrators shall control. The
majority decision of the arbitrators shall be final and binding on the parties,
and shall be enforceable in accordance with law. Judgment may be entered on the
arbitrators” award in any court having jurisdiction. The Executive shall be
entitled to seek specific performances of her rights under this Agreement during
the pendency of any dispute or controversy arising under or in connection with
this Agreement. The Corporation will reimburse Executive for all reasonable
attorney fees incurred by Executive as the result of any arbitration with regard
to any issue under this Agreement (or any judicial proceeding to compel or to
enforce such arbitration); (i) which is initiated by Executive if the
Corporation is found in such proceeding to have violated this Agreement
substantially as alleged by Executive; or (ii) which is initiated by the
Corporation, unless Executive is found in such proceeding to have violated this
Agreement substantially as alleged by the Corporation.

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        IN WITNESS WHEREOF, the parties have signed this Agreement on March 3,
2008, effective as of the day and year written above.

CORPORATION:
FNBH BANCORP, INC.

By     /s/ James McAuliffe
      —————————————————
      James McAuliffe            
      Its President & CEO

EXECUTIVE:

       /s/ Nancy Morgan
——————————————————
                         (Signature)

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FNBH BANCORP, INC.
NOTICE OF NON-RENEWAL OF
MANAGEMENT CONTINUITY AGREEMENT

Dear ________:

        In accordance with paragraph 1 of your Management Continuity Agreement
between you and FNBH Bancorp, Inc. (“FNBH”), dated ____________ (the
“Agreement”), FNBH hereby provides notice of its election not to renew that
Agreement. Accordingly, the Agreement will expire as of ____________________.

FNBH BANCORP, INC.

By
      ————————————————

      Its
            ———————————————

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