EXHIBIT 10.2
FIRST AMENDMENT TO THE
MIDWEST BANC HOLDINGS, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT
     This First Amendment to the Midwest Banc Holdings, Inc. Supplemental
Executive Retirement Agreement (the “Agreement”) is made and entered into this
                     day of , by and between Midwest Banc Holdings, Inc., a
Delaware corporation (the “Company”), and the undersigned executive (the
“Executive”).
     WHEREAS, the American Jobs Creation Act of 2004 signed into law on
October 22, 2004 added a new Section 409A to the Internal Revenue Code of 1986,
as amended (the “Code”);
     WHEREAS, Section 409A imposed substantive requirements on nonqualified
deferred compensation plans which are defined to include an agreement or
arrangement that includes one person;
     WHEREAS, Section 409A restricts the timing of distributions from
nonqualified deferred compensation plans;
     WHEREAS, the Agreement does not satisfy the distribution requirements under
Section 409A;
     WHEREAS, failure to comply with Section 409A will result in immediate
income tax consequences to the Executive;
     NOW, THEREFORE, to avoid immediate income tax consequences the parties
agree to amend the Agreement in the following manner so that it complies with
Section 409A:
     Section 1.4 of the Plan is amended in its entirety to read as follows,
effective January 1, 2005:

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     1.4 “Change of Control” means a change in the ownership or effective
control of the Company, or in the ownership of a substantial portion of the
assets of the Company as provided in section 409A(a)(2)(A)(v) of the Code.
Pending issuance of Treasury regulations, “Change in Control” will be as defined
in IRS Notice 2005-1 and subsequent guidance. In accordance with IRS Notice
2005-1, “Change in Control” means:
     (a) Change in Ownership. A change in the ownership of the Company occurs on
the date that any person or persons acting as a group acquires ownership of
stock of the Company that, together with stock held by such person or group,
constitutes more than 50 percent of the total fair market value or total voting
power of the stock of such Company. If a person or group is considered to own
more than 50 percent of the total fair market value or total combined voting
power of the stock of the Company, the acquisition of additional stock by the
same person or persons is not considered to cause a change in the ownership of
the Company (or to cause a change in the “effective control of the Company”
within the meaning of paragraph (c)).
     (b) Change in Effective Control. A change in the effective control of the
Company occurs on the date that a majority of the Company’s board of directors
is replaced during any 12-month period by directors whose appointment or
election is not endorsed by a majority of the members of the Company’s board of
directors prior to the date of the appointment or election.
     (c) Change in Ownership of a Substantial Portion of the Company’s Assets. A
change in the ownership of a substantial portion of the Company’s assets occurs
on the date that any person or group acquires (or has acquired during the
12-month period ending on the date of the most recent acquisition by such person
or persons) assets from the Company that have a total gross fair market value
equal to or more than 50 percent of the total gross fair market value of all of
the assets of the Company immediately prior to such acquisition or acquisitions.
           Article 1 of the Plan is amended by adding the following Section 1.22
at the end thereof, effective January 1, 2005:
     1.22 “Specified Employee” means a key employee (as defined in section
416(i) of the Code without regard to paragraph (5) thereof).
            Section 2.1.2 of the Plan is amended in its entirety to read as
follows, effective January 1, 2005:
     2.1.2 Payment of Benefit. The Employer shall pay the annual benefit to the
Executive in twelve (12) equal monthly installments payable on the first day

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of each month commencing with the month following the Executive’s Termination of
Employment. Notwithstanding the foregoing, for any Specified Employee
distributions may not be made before the date which is six (6) months after the
date of Termination of Employment (or, if earlier, the date of death of the
Executive). The annual benefit shall be paid to the Executive for fifteen (15)
years.
           4. Section 2.2.2 of the Plan is amended in its entirety to read as
follows, effective January 1, 2005:
     2.2.2 Payment of Benefit. The Employer shall pay the annual benefit to the
Executive in twelve (12) equal monthly installments payable on the first day of
each month commencing with the month following the Executive’s Termination of
Employment. Notwithstanding the foregoing, for any Specified Employee
distributions may not be made before the date which is six (6) months after the
date of Termination of Employment (or, if earlier, the date of death of the
Executive). The annual benefit shall be paid to the Executive for fifteen (15)
years.
           5. Section 2.3.2 of the Plan is amended in its entirety to read as
follows, effective January 1, 2005:
     2.3.2 Payment of Benefit. The Employer shall pay the annual benefit to the
Executive in twelve (12) equal monthly installments payable on the first day of
each month commencing with the month following the Executive’s Normal Retirement
Date. Notwithstanding the foregoing, for any Specified Employee distributions
may not be made before the date which is six (6) months after the date of
Termination of Employment (or, if earlier, the date of death of the Executive).
The annual benefit shall be paid to the Executive for fifteen (15) years.
           6. Section 2.4.2 of the Plan is amended in its entirety to read as
follows, effective January 1, 2005:
     2.4.2 Payment of Benefit. The Employer shall pay the annual benefit amount
to the Executive in twelve (12) equal monthly installments payable on the first
day of each month commencing with the month following the Executive’s Normal
Retirement Date. Notwithstanding the foregoing, for any Specified Employee
distributions may not be made before the date which is six (6) months after the
date of Termination of Employment (or, if earlier, the date of death of the
Executive). The annual benefit shall be paid to the Executive for fifteen (15)
years.
           7. Section 2.5.2 of the Plan is amended in its entirety to read as
follows, effective January 1, 2005:
     2.5.2 Payment of Benefit. The Employer shall pay the annual benefit amount
to the Executive in twelve (12) equal monthly installments payable on the

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first day of each month commencing with the month following the Executive’s
Normal Retirement Date. Notwithstanding the foregoing, for any Specified
Employee distributions may not be made before the date which is six (6) months
after the date of Termination of Employment (or, if earlier, the date of death
of the Executive). The annual benefit shall be paid to the Executive for fifteen
(15) years.
* * *
     IN WITNESS WHEREOF, the Executive and a duly authorized officer of the
Company have executed this First Amendment as of the date set forth above.

          Executive:   Company:     MIDWEST BANC HOLDINGS, INC., for itself and
its     Subsidiaries
 
       
 
  By:    
 
       
 
  Title:   President & CEO