##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20552
 FORM 10-Q
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
 Commission File Number 000-32561
 
 Middlefield Banc Corp.
 (Exact name of registrant as specified in its charter)
 Ohio
    
    34-1585111(State or other jurisdiction of incorporation 
or organization)
    
    (IRS Employer Identification No.)
 15985 East High Street, Middlefield, Ohio 44062-9263
(Address of principal executive offices)
 (440) 632-1666
(Registrants telephone number, including area code)
 Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. YES þ NO o
 Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate website, if any, every Interactive Data File required to be submitted and posted pursuant
to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or
for such shorter period that the registrant was required to submit and post such files). Yes o No o
 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer or a smaller reporting company. See the definition of large accelerated
filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
 Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filero
    
    Small reporting companyþ
 Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). YES o NO þ
 State the number of shares outstanding of each of the issuers classes of common equity as of the
latest practicle date:
 Class: Common Stock, without par value
Outstanding at November 12, 2009: 1,556,774




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##### 



MIDDLEFIELD BANC CORP.
 INDEX
 PageNumberPART I    FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Balance Sheet (Unaudited) as of
September 30, 2009 and December 31, 2008
    
    
    3Consolidated Statement of Income (Unaudited) 
for the Three and Nine Months ended September 30, 2009
and 2008
    
    
    4Consolidated Statement of Changes in Stockholders Equity (Unaudited) 
for the nine Months ended September 30, 2009
    
    
    5Consolidated Statement of Cash Flows (Unaudited) 
for the nine Months ended September 30, 2009 and 2008
    
    
    6Notes to Unaudited Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4. Controls and Procedures
    
    
    26PART II    OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    26Item 1A. Risk Factors
    
    
    26Item 2. Unregistered sales of equity securities and use of proceeds
    
    
    26Item 3. Default Upon Senior Securities
    
    
    27Item 4. Submissions of Matters to a Vote of Security Holders
    
    
    27Item 5. Other Information
    
    
    27Item 6. Exhibits and Reports on Form 8-K
    
    
    27SIGNATURES
    
    
    31Exhibit 31Exhibit 31.1Exhibit 32Exhibit 99
   2




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September 30,
    
    
    December 31,2009
    
    
    2008ASSETSCash and due from banks
    
    $
    11,143,127
    
    
    $
    9,795,248Federal funds sold
    
    
    19,533,878
    
    
    
    7,548,000Interest-bearing deposits in other institutions
    
    
    120,885
    
    
    
    112,215Cash and cash equivalents
    
    
    30,797,890
    
    
    
    17,455,463Investment securities available for sale
    
    
    116,880,660
    
    
    
    104,270,366Loans
    
    
    345,918,924
    
    
    
    321,575,293Less allowance for loan losses
    
    
    4,422,250
    
    
    
    3,556,763Net loans
    
    
    341,496,674
    
    
    
    318,018,530Premises and equipment
    
    
    8,256,905
    
    
    
    8,448,915Goodwill
    
    
    4,558,687
    
    
    
    4,558,687Bank-owned life insurance
    
    
    7,637,731
    
    
    
    7,440,687Accrued interest and other assets
    
    
    8,317,212
    
    
    
    7,654,287TOTAL ASSETS
    
    $
    517,945,759
    
    
    $
    467,846,935LIABILITIESDeposits:Noninterest-bearing demand
    
    $
    40,963,722
    
    
    $
    42,357,154Interest-bearing demand
    
    
    34,877,418
    
    
    
    26,404,660Money market
    
    
    42,078,988
    
    
    
    27,845,438Savings
    
    
    99,322,206
    
    
    
    68,968,844Time
    
    
    230,686,676
    
    
    
    229,243,506Total deposits
    
    
    447,929,010
    
    
    
    394,819,602Short-term borrowings
    
    
    1,667,967
    
    
    
    1,886,253Other borrowings
    
    
    28,772,173
    
    
    
    33,903,019Accrued interest and other liabilities
    
    
    2,097,903
    
    
    
    2,178,813TOTAL LIABILITIES
    
    
    480,467,053
    
    
    
    432,787,687STOCKHOLDERS EQUITYCommon stock, no par value; 10,000,000 shares authorized,
1,746,304 and 1,725,381 shares issued
    
    
    27,759,557
    
    
    
    27,301,403Retained earnings
    
    
    14,860,713
    
    
    
    14,786,353Accumulated other comprehensive income/(loss)
    
    
    1,592,043
    
    
    
    (294,901
    )Treasury stock, at cost; 189,530 shares in 2009 and 2008
    
    
    (6,733,607
    )
    
    
    (6,733,607
    )TOTAL STOCKHOLDERS EQUITY
    
    
    37,478,706
    
    
    
    35,059,248TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY
    
    $
    517,945,759
    
    
    $
    467,846,935
   3




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Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008INTEREST INCOMEInterest and fees on loans
    
    $
    5,175,354
    
    
    $
    5,425,266
    
    
    $
    15,079,662
    
    
    $
    16,273,630Interest-bearing deposits in
other institutions
    
    
    2,293
    
    
    
    1,949
    
    
    
    11,800
    
    
    
    10,790Federal funds sold
    
    
    3,936
    
    
    
    22,181
    
    
    
    10,977
    
    
    
    124,467Investment securities:Taxable interest
    
    
    975,580
    
    
    
    622,184
    
    
    
    2,752,897
    
    
    
    1,793,645Tax-exempt interest
    
    
    474,629
    
    
    
    449,351
    
    
    
    1,374,847
    
    
    
    1,360,226Dividends on FHLB stock
    
    
    15,847
    
    
    
    29,514
    
    
    
    46,611
    
    
    
    88,526Total interest income
    
    
    6,647,639
    
    
    
    6,550,445
    
    
    
    19,276,794
    
    
    
    19,651,284INTEREST EXPENSEDeposits
    
    
    2,501,502
    
    
    
    2,948,998
    
    
    
    7,776,369
    
    
    
    9,381,666Short term
borrowings
    
    
    4,987
    
    
    
    17,610
    
    
    
    15,161
    
    
    
    34,793Other borrowings
    
    
    354,769
    
    
    
    432,055
    
    
    
    1,114,899
    
    
    
    1,254,040Total interest expense
    
    
    2,861,258
    
    
    
    3,398,663
    
    
    
    8,906,429
    
    
    
    10,670,499NET INTEREST INCOME
    
    
    3,786,381
    
    
    
    3,151,782
    
    
    
    10,370,365
    
    
    
    8,980,785Provision for loan losses
    
    
    1,346,000
    
    
    
    187,000
    
    
    
    1,760,000
    
    
    
    357,000NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES
    
    
    2,440,381
    
    
    
    2,964,782
    
    
    
    8,610,365
    
    
    
    8,623,785NONINTEREST INCOMEService charges on deposit accounts
    
    
    488,747
    
    
    
    493,228
    
    
    
    1,394,312
    
    
    
    1,417,789Investment securities gains, net
    
    
    
    
    
    
    25,758
    
    
    
    
    
    
    
    34,508Earnings on bank-owned life insurance
    
    
    68,413
    
    
    
    75,336
    
    
    
    197,044
    
    
    
    217,798Other income
    
    
    133,300
    
    
    
    85,925
    
    
    
    358,775
    
    
    
    284,820Total noninterest income
    
    
    690,460
    
    
    
    680,247
    
    
    
    1,950,131
    
    
    
    1,954,915NONINTEREST EXPENSESalaries and employee benefits
    
    
    1,395,388
    
    
    
    1,322,026
    
    
    
    4,303,972
    
    
    
    3,643,199Occupancy expense
    
    
    215,768
    
    
    
    203,298
    
    
    
    691,538
    
    
    
    643,884Equipment expense
    
    
    151,742
    
    
    
    150,334
    
    
    
    425,175
    
    
    
    435,770Data processing costs
    
    
    224,615
    
    
    
    193,033
    
    
    
    692,362
    
    
    
    591,098Ohio state franchise tax
    
    
    123,300
    
    
    
    117,000
    
    
    
    369,900
    
    
    
    351,000FDIC assessment
    
    
    86,108
    
    
    
    71,702
    
    
    
    529,268
    
    
    
    117,394Other expense
    
    
    843,030
    
    
    
    672,188
    
    
    
    2,326,521
    
    
    
    2,041,882Total noninterest expense
    
    
    3,039,951
    
    
    
    2,729,581
    
    
    
    9,338,736
    
    
    
    7,824,227Income before income taxes
    
    
    90,890
    
    
    
    915,448
    
    
    
    1,221,760
    
    
    
    2,754,473Income taxes
    
    
    (122,574
    )
    
    
    211,000
    
    
    
    (55,574
    )
    
    
    530,000NET INCOME
    
    $
    213,464
    
    
    $
    704,448
    
    
    $
    1,277,334
    
    
    $
    2,224,473EARNINGS PER SHAREBasic
    
    $
    0.14
    
    
    $
    0.46
    
    
    $
    0.83
    
    
    $
    1.45Diluted
    
    
    0.14
    
    
    
    0.46
    
    
    
    0.83
    
    
    
    1.44DIVIDENDS DECLARED PER SHARE
    
    $
    0.26
    
    
    $
    0.26
    
    
    $
    0.78
    
    
    $
    0.77
   4




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##### Table of Contents



AccumulatedOther
    
    
    
    
    
    
    TotalCommon
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury
    
    
    Stockholders
    
    
    ComprehensiveStock
    
    
    Earnings
    
    
    Income/(Loss)
    
    
    Stock
    
    
    Equity
    
    
    IncomeBalance, December 31, 2008
    
    $
    27,301,403
    
    
    $
    14,786,353
    
    
    $
    (294,901
    )
    
    $
    (6,733,607
    )
    
    $
    35,059,248Net income
    
    
    
    
    
    
    1,277,334
    
    
    
    
    
    
    
    
    
    
    
    1,277,334
    
    
    $
    1,277,334Other comprehensive income:Unrealized gains on available for
sale
securities net of taxes of $972,040
    
    
    
    
    
    
    
    
    
    
    1,886,944
    
    
    
    
    
    
    
    1,886,944
    
    
    
    1,886,944Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    3,164,278Stock based compensation expense
recognized in earnings
    
    
    45,441
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,441Dividend reinvestment and purchase plan
    
    
    412,713
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    412,713Cash dividends ($0.78 per share)
    
    
    
    
    
    
    (1,202,974
    )
    
    
    
    
    
    
    
    
    
    
    (1,202,974
    )Balance, September 30, 2009
    
    $
    27,759,557
    
    
    $
    14,860,713
    
    
    $
    1,592,043
    
    
    $
    (6,733,607
    )
    
    $
    37,478,706
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##### Table of Contents



Nine Months EndedSeptember 30,2009
    
    
    2008OPERATING ACTIVITIESNet income
    
    $
    1,277,334
    
    
    $
    2,224,473Adjustments to reconcile net income to
net cash provided by operating activities:Provision for loan losses
    
    
    1,760,000
    
    
    
    357,000Investment securities gains, net
    
    
    
    
    
    
    (34,509
    )Depreciation
    
    
    437,477
    
    
    
    393,883Amortization of premium and
discount on investment securities
    
    
    (385,732
    )
    
    
    158,650Amortization of deferred loan fees, net
    
    
    (43,495
    )
    
    
    (104,138
    )Earnings on bank-owned life insurance
    
    
    (197,044
    )
    
    
    (217,799
    )Compensation for stock option expense
    
    
    45,441
    
    
    
    11,286Loss on other real estate owned
    
    
    182,796
    
    
    
    Increase in accrued interest receivable
    
    
    (408,746
    )
    
    
    (364,938
    )Decrease in accrued interest payable
    
    
    (233,106
    )
    
    
    (223,246
    )Other, net
    
    
    (391,146
    )
    
    
    (123,615
    )Net cash provided by operating activities
    
    
    2,043,780
    
    
    
    2,077,047INVESTING ACTIVITIESInvestment securities available for sale:Proceeds from repayments and maturities
    
    
    14,902,736
    
    
    
    11,598,563Proceeds from sale of securities
    
    
    
    
    
    
    2,929,439Purchases
    
    
    (24,268,290
    )
    
    
    (27,760,155
    )Increase in loans, net
    
    
    (26,146,245
    )
    
    
    (11,751,849
    )Purchase of Federal Home Loan Bank stock
    
    
    (14,100
    )
    
    
    (85,200
    )Proceeds from the sale of other real estate owned
    
    
    100,000Purchase of premises and equipment
    
    
    (245,468
    )
    
    
    (1,367,701
    )Net cash used for investing activities
    
    
    (35,671,368
    )
    
    
    (26,436,903
    )FINANCING ACTIVITIESNet increase in deposits
    
    
    53,109,408
    
    
    
    17,046,151Increase (decrease) in short-term borrowings, net
    
    
    (218,286
    )
    
    
    183,092Repayment of other borrowings
    
    
    (5,130,846
    )
    
    
    (7,707,395
    )Proceeds from other borrowings
    
    
    
    
    
    
    12,000,000Purchase of treasury stock
    
    
    
    
    
    
    (1,350,881
    )Proceeds from dividend reinvestment & purchase plan
    
    
    412,713
    
    
    
    498,193Cash dividends
    
    
    (1,202,974
    )
    
    
    (1,177,829
    )Net cash provided by financing activities
    
    
    46,970,015
    
    
    
    19,491,331Increase (decrease) in cash and cash equivalents
    
    
    13,342,427
    
    
    
    (4,868,525
    )CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD
    
    
    17,455,463
    
    
    
    17,815,322CASH AND CASH EQUIVALENTS
AT END OF PERIOD
    
    $
    30,797,890
    
    
    $
    12,946,797SUPPLEMENTAL INFORMATIONCash paid during the year for:Interest on deposits and borrowings
    
    $
    9,147,651
    
    
    $
    10,901,695Income taxes
    
    
    275,000
    
    
    
    400,000
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Topic 105  Generally Accepted Accounting Principles  FASB Accounting
Standards Codification and the Hierarchy of Generally Accepted Accounting Principles
 Amendments to FASB Interpretation No. 46(R) Consolidation of Variable Interest
Entities
 Fair Value Measurements and
Disclosures
 Financial Instruments
  7




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Investments  Debt and Equity
Securities
 Fair Value Measurements and Disclosures (Topic
820)  Measuring Liabilities at Fair Value
    Weighted-
    
    
    
    
    
    
    Weighted-average
    
    
    
    
    
    
    averageExercise
    
    
    
    
    
    
    Exercise2009
    
    
    Price
    
    
    2008
    
    
    PriceOutstanding, January 1
    
    
    110,465
    
    
    $
    27.21
    
    
    
    88,211
    
    
    $
    28.04Granted
    
    
    
    
    
    
    
    
    
    
    1,337
    
    
    
    36.25Exercised
    
    
    
    
    
    
    
    
    
    
    (992
    )
    
    
    19.80Forfeited
    
    
    (7,575
    )
    
    
    33.60
    
    
    
    (1,591
    )
    
    
    23.48Outstanding, September 30
    
    
    102,890
    
    
    $
    26.74
    
    
    
    86,965
    
    
    $
    28.34
  8




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##### Table of Contents



For the Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Weighted average common shares
outstanding
    
    
    1,740,586
    
    
    
    1,712,574
    
    
    
    1,733,107
    
    
    
    1,707,720Average treasury stock shares
    
    
    (189,530
    )
    
    
    (189,530
    )
    
    
    (189,530
    )
    
    
    (173,979
    )Weighted average common shares and
common stock equivalents used to
calculate basic earnings per share
    
    
    1,551,056
    
    
    
    1,523,044
    
    
    
    1,543,577
    
    
    
    1,533,741Additional common stock equivalents
(stock options) used to calculate
diluted earnings per share
    
    
    13
    
    
    
    2,329
    
    
    
    1,100
    
    
    
    12,659Weighted average common shares and
common stock equivalents used
to calculate diluted earnings per share
    
    
    1,551,069
    
    
    
    1,525,373
    
    
    
    1,544,677
    
    
    
    1,546,400
   9




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For the Three Months Ended
    
    
    For the Nine Months EndedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Unrealized holding gains (losses) arising during
the period on securities held
    
    $
    1,847,915
    
    
    $
    (727,463
    )
    
    $
    1,886,944
    
    
    $
    (1,807,694
    )Reclassification adjustment for gains included in net income
    
    
    
    
    
    
    17,000
    
    
    
    
    
    
    
    22,775Net change in unrealized gains (losses) during the period
    
    
    1,847,915
    
    
    
    (710,463
    )
    
    
    1,886,944
    
    
    
    (1,784,919
    )Unrealized holding gains (losses), beginning of period
    
    
    (255,872
    )
    
    
    (1,127,425
    )
    
    
    (294,901
    )
    
    
    (52,969
    )Unrealized holding gains (losses), end of period
    
    
    1,592,043
    
    
    
    (1,837,888
    )
    
    
    1,592,043
    
    
    
    (1,837,888
    )Net income
    
    
    213,464
    
    
    
    704,448
    
    
    
    1,277,334
    
    
    
    2,224,473Other comprehensive income, net of tax:Unrealized holding gains (losses) arising during the period
    
    
    1,847,915
    
    
    
    (710,463
    )
    
    
    1,886,944
    
    
    
    (1,784,919
    )Comprehensive income (loss)
    
    $
    2,061,379
    
    
    $
    (6,015
    )
    
    $
    3,164,278
    
    
    $
    439,554
   Level I:
    
    Quoted prices are available in active markets for identical assets or liabilities as of the reported date.Level II:
    
    Pricing inputs are other than the quoted prices in active markets, which are either directly or indirectly
observable as of the reported date. The nature of these assets and liabilities includes items for which quoted
prices are available but traded less frequently and items that are fair-valued using other financial instruments,
the parameters of which can be directly observed.Level III:
    
    Assets and liabilities that have little to no pricing observe ability as of the reported date. These items do not
have two-way markets and are measured using managements best estimate of fair value, where the inputs into the
determination of fair value require significant management judgment or estimation.
  10




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September 30, 2009Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a Recurring Basis:U.S. government agency securities
    
    $
    
    
    
    $
    7,413,855
    
    
    $
    
    
    
    $
    7,413,855Obligations of states and political subdivisions
    
    
    
    
    
    
    51,451,392
    
    
    
    
    
    
    
    51,451,392Mortgage-backed securities
    
    
    
    
    
    
    57,134,177
    
    
    
    
    
    
    
    57,134,177Total debt securities
    
    
    
    
    
    
    115,999,424
    
    
    
    
    
    
    
    115,999,424Equity securities
    
    
    881,236
    
    
    
    
    
    
    
    
    
    
    
    881,236Total
    
    $
    881,236
    
    
    $
    115,999,424
    
    
    $
    
    
    
    $
    116,880,660
 December 31, 2008Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a Recurring Basis:U.S. government agency securities
    
    $
    
    
    
    $
    4,503,562
    
    
    $
    
    
    
    $
    4,503,562Obligations of states and political subdivisions
    
    
    
    
    
    
    44,180,282
    
    
    
    
    
    
    
    44,180,282Mortgage-backed securities
    
    
    
    
    
    
    47,884,210
    
    
    
    6,680,150
    
    
    
    54,564,360Total debt securities
    
    
    
    
    
    
    96,568,054
    
    
    
    6,680,150
    
    
    
    103,248,204Equity securities
    
    
    1,022,162
    
    
    
    
    
    
    
    
    
    
    
    1,022,162Total
    
    $
    1,022,162
    
    
    $
    96,568,054
    
    
    $
    6,680,150
    
    
    $
    104,270,366
   Available-for-SaleSecuritiesBalance, December 31, 2008
    
    $
    6,680,150Total gains or losses (realized/unrealizes)Included in earnings
    
    
    Included in other comprehensive gain/(loss)
    
    
    (468,742
    )Purchases, issuances, and settlements
    
    
    (1,120,525
    )Net transfers in and/or out of Level III
    
    
    (5,090,883
    )Balance, September 30, 2009
    
    $
    The amount of total gains or losses for the period included in
earnings attributable to the change in unrealized gains or losses
relating to assets still held at the reporting date
    
    $
    
   11




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##### Table of Contents



September 30, 2009Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a non-recurring Basis:Impaired loans
    
    $
    
    
    
    $
    321,164
    
    
    $
    2,996,122
    
    
    $
    3,317,286
 December 31, 2008Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a non-recurring Basis:Impaired loans
    
    $
    
    
    
    $
    1,194,594
    
    
    $
    1,027,366
    
    
    $
    2,221,960
  September 30, 2009
    
    
    December 31, 2008Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairValue
    
    
    Value
    
    
    Value
    
    
    ValueFinancial assets:Cash and cash equivalents
    
    $
    30,797,890
    
    
    $
    30,797,890
    
    
    $
    17,455,463
    
    
    $
    17,455,463Investment securitiesAvailable for sale
    
    
    116,880,660
    
    
    
    116,880,660
    
    
    
    104,270,366
    
    
    
    104,270,366Net loans
    
    
    341,496,674
    
    
    
    324,340,394
    
    
    
    318,018,530
    
    
    
    317,010,526Bank-owned life insurance
    
    
    7,637,731
    
    
    
    7,637,731
    
    
    
    7,440,687
    
    
    
    7,440,687Federal Home Loan Bank stock
    
    
    1,887,200
    
    
    
    1,887,200
    
    
    
    1,873,100
    
    
    
    1,873,100Accrued interest receivable
    
    
    1,855,119
    
    
    
    1,855,119
    
    
    
    1,446,373
    
    
    
    1,446,373Financial liabilities:Deposits
    
    $
    447,929,010
    
    
    $
    454,074,221
    
    
    $
    394,819,602
    
    
    $
    399,946,594Short-term borrowings
    
    
    1,667,967
    
    
    
    1,667,967
    
    
    
    1,886,253
    
    
    
    1,886,253Other borrowings
    
    
    28,772,173
    
    
    
    30,768,288
    
    
    
    33,903,019
    
    
    
    35,771,019Accrued interest payable
    
    
    1,066,009
    
    
    
    1,066,009
    
    
    
    1,299,114
    
    
    
    1,299,114
  12




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##### Table of Contents



Cash and Cash Equivalents, Federal Home Loan Bank Stock, Accrued Interest Receivable, Accrued
Interest Payable, and Short-Term Borrowings
  Bank-Owned Life Insurance
  Investment Securities Available for Sale
  Loans
  Deposits and Other Borrowed Funds
  Commitments to Extend Credit
   13




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##### Table of Contents



September 30, 2009Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. government agency
securities
    
    $
    7,335,466
    
    
    $
    79,625
    
    
    $
    (1,236
    )
    
    $
    7,413,855Obligations of states and
political subdivisions:Taxable
    
    
    499,693
    
    
    
    9,487
    
    
    
    
    
    
    
    509,180Tax-exempt
    
    
    49,428,388
    
    
    
    1,631,566
    
    
    
    (117,742
    )
    
    
    50,942,212Mortgage-backed securities
    
    
    56,260,642
    
    
    
    2,097,834
    
    
    
    (1,224,299
    )
    
    
    57,134,177Total debt securities
    
    
    113,524,189
    
    
    
    3,818,511
    
    
    
    (1,343,276
    )
    
    
    115,999,424Equity Securities
    
    
    944,283
    
    
    
    3,555
    
    
    
    (66,602
    )
    
    
    881,236Total
    
    $
    114,468,472
    
    
    $
    3,822,066
    
    
    $
    (1,409,878
    )
    
    $
    116,880,660
 December 31, 2008Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. government agency
securities
    
    $
    4,376,650
    
    
    $
    126,912
    
    
    $
    
    
    
    $
    4,503,562Obligations of states and
political subdivisions:Taxable
    
    
    499,528
    
    
    
    
    
    
    
    (3,278
    )
    
    
    496,250Tax-exempt
    
    
    44,328,318
    
    
    
    405,958
    
    
    
    (1,050,244
    )
    
    
    43,684,032Mortgage-backed securities
    
    
    54,568,407
    
    
    
    1,042,038
    
    
    
    (1,046,085
    )
    
    
    54,564,360Total debt securities
    
    
    103,772,903
    
    
    
    1,574,908
    
    
    
    (2,099,607
    )
    
    
    103,248,204Equity Securities
    
    
    944,283
    
    
    
    141,079
    
    
    
    (63,200
    )
    
    
    1,022,162Total
    
    $
    104,717,186
    
    
    $
    1,715,987
    
    
    $
    (2,162,807
    )
    
    $
    104,270,366
  Amortized
    
    
    FairCost
    
    
    ValueDue in one year or less
    
    $
    1,219,267
    
    
    $
    1,229,412Due after one year through five years
    
    
    7,001,915
    
    
    
    7,394,072Due after five years through ten years
    
    
    17,176,356
    
    
    
    17,717,093Due after ten years
    
    
    88,126,651
    
    
    
    89,658,847Total
    
    $
    113,524,189
    
    
    $
    115,999,424
   14




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##### Table of Contents



September 30, 2009Less than Twelve Months
    
    
    Twelve Months or Greater
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesU.S. government agency
securities
    
    $
    759,230
    
    
    $
    (1,236
    )
    
    $
    
    
    
    $
    
    
    
    $
    759,230
    
    
    $
    (1,236
    )Obligations of states and
political subdivisions
    
    
    1,990,671
    
    
    
    (19,675
    )
    
    
    1,789,277
    
    
    
    (98,067
    )
    
    
    3,779,947
    
    
    
    (117,742
    )Mortgage-backed securities
    
    
    6,149,761
    
    
    
    (140,811
    )
    
    
    4,692,470
    
    
    
    (1,083,488
    )
    
    
    10,842,231
    
    
    
    (1,224,299
    )Equity securities
    
    
    474,768
    
    
    
    (25,252
    )
    
    
    4,600
    
    
    
    (41,350
    )
    
    
    479,368
    
    
    
    (66,602
    )Total
    
    $
    9,374,429
    
    
    $
    (186,974
    )
    
    $
    6,486,346
    
    
    $
    (1,222,904
    )
    
    $
    15,860,776
    
    
    $
    (1,409,878
    )
 December 31, 2008Less than Twelve Months
    
    
    Twelve Months or Greater
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesObligations of states and
political subdivisions
    
    
    17,777,295
    
    
    
    (561,005
    )
    
    
    7,820,417
    
    
    
    (492,517
    )
    
    
    25,597,712
    
    
    
    (1,053,522
    )Mortgage-backed securities
    
    
    16,107,618
    
    
    
    (966,793
    )
    
    
    5,062,619
    
    
    
    (79,292
    )
    
    
    21,170,237
    
    
    
    (1,046,085
    )Equity securities
    
    
    221,500
    
    
    
    (28,500
    )
    
    
    11,250
    
    
    
    (34,700
    )
    
    
    232,750
    
    
    
    (63,200
    )Total
    
    $
    34,106,413
    
    
    $
    (1,556,298
    )
    
    $
    12,894,286
    
    
    $
    (606,509
    )
    
    $
    47,000,699
    
    
    $
    (2,162,807
    )
     15




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##### Table of Contents




    
    The length of time and the extent to which the fair value has been less than the amortized cost basis.
    
    Changes in the near term prospects of the underlying collateral of a security such as changes in
default rates, loss severity given default and significant changes in prepayment assumptions;
    
    The level of cash flows generated from the underlying collateral supporting the principal and
interest payments of the debt securities; and
    
    Any adverse change to the credit conditions and liquidity of the issuer, taking into consideration
the latest information available about the overall financial condition of the issuer, credit ratings,
recent legislation and government actions affecting the issuers industry and actions taken by the
issuer to deal with the present economic climate.
     
 Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
  CHANGES IN FINANCIAL CONDITION
 General.
 Cash on hand and due from banks.
  16




---



##### Table of Contents



Investment securities.
 Loans receivable.
  Allowance for Loan Losses and Asset Quality
   Non-performing assets.
  17




---



##### Table of Contents



Nonperforming Assets and Allowance for Loan Losses.
   9/30/2009
    
    
    6/30/2009
    
    
    3/31/2009
    
    
    12/31/2008
    
    
    9/30/2008Nonperforming loans
    
    $
    14,368
    
    
    $
    14,023
    
    
    $
    13,370
    
    
    $
    8,481
    
    
    $
    6,749Real estate owned
    
    
    1,775
    
    
    
    1,967
    
    
    
    1,331
    
    
    
    1,106
    
    
    
    1,108Nonperforming assets
    
    $
    16,143
    
    
    $
    15,991
    
    
    $
    14,701
    
    
    $
    9,587
    
    
    $
    7,857Allowance for loan losses
    
    $
    4,422
    
    
    $
    3,668
    
    
    $
    3,621
    
    
    $
    3,557
    
    
    $
    3,614RatiosNonperforming loans to total loans
    
    
    4.15
    %
    
    
    4.18
    %
    
    
    4.16
    %
    
    
    2.64
    %
    
    
    2.11
    %Nonperforming assets to total
assets
    
    
    3.12
    %
    
    
    3.33
    %
    
    
    3.14
    %
    
    
    2.11
    %
    
    
    1.76
    %Allowance for loan losses to total
loans
    
    
    1.28
    %
    
    
    1.09
    %
    
    
    1.13
    %
    
    
    1.11
    %
    
    
    1.13
    %Allowance for loan losses to
nonperforming loans
    
    
    30.78
    %
    
    
    26.16
    %
    
    
    27.08
    %
    
    
    41.94
    %
    
    
    53.55
    %
  Deposits.
 Borrowed funds.
 Stockholders equity.
  RESULTS OF OPERATIONS
 General.
  18




---



##### Table of Contents



Net interest income.
   Interest income.
      19




---



##### Table of Contents



Interest expense.
 1.
    
    A volume increase in the balance of interest-bearing liabilities of $45.1 million
resulting in $244,000 of additional interest cost.
 2.
    
    The interest rate on interest-bearing liabilities declining by 90 basis points from
3.62% for the second quarter of 2008 to 2.72% for the same period in 2009.
  1.
    
    A volume increase in the balance of interest-bearing liabilities of $31.2 million
resulting in $589,000 of additional interest cost.
 2.
    
    The interest rate on interest-bearing liabilities declining by 88 basis points from
3.85% for the first two quarters of 2008 to 2.97% for the same period in 2009.
     Provision for loan losses.
 Non-interest income.
  20




---



##### Table of Contents



Non-interest expense.
  Provision for income taxes.
 CRITICAL ACCOUNTING ESTIMATES
  Average Balance Sheet and Yield/Rate Analysis.
  21




---



##### Table of Contents



Analysis of Changes in Net Interest Income.
 For the Three Months Ended September 30,2009
    
    
    2008(4)
    
    
    
    
    
    
    
    
    
    
    (4)Average
    
    
    
    
    
    
    Average
    
    
    Average
    
    
    
    
    
    
    AverageBalance
    
    
    Interest (1)
    
    
    Yield/Cost
    
    
    Balance
    
    
    Interest (1)
    
    
    Yield/Cost(Dollars in thousands)
    
    
    (Dollars in thousands)Interest-earning assets:Loans receivable
    
    $
    339,979
    
    
    $
    5,175
    
    
    
    6.04
    %
    
    $
    318,761
    
    
    $
    5,425
    
    
    
    6.75
    %Investments securities (taxable equivalent)
    
    
    106,556
    
    
    
    1,450
    
    
    
    6.31
    %
    
    
    94,532
    
    
    
    1,073
    
    
    
    5.48
    %Interest-bearing deposits with other banks
    
    
    15,124
    
    
    
    22
    
    
    
    0.58
    %
    
    
    5,897
    
    
    
    52
    
    
    
    3.48
    %Total interest-earning assets
    
    
    461,659
    
    
    
    6,648
    
    
    
    5.92
    %
    
    
    419,191
    
    
    
    6,550
    
    
    
    6.42
    %Noninterest-earning assets
    
    
    36,226
    
    
    
    
    
    
    
    
    
    
    
    29,782Total assets
    
    $
    497,885
    
    
    
    
    
    
    
    
    
    
    $
    448,973Interest-bearing liabilities:Interest  bearing demand deposits
    
    $
    34,189
    
    
    
    87
    
    
    
    1.01
    %
    
    $
    25,962
    
    
    
    78
    
    
    
    1.19
    %Money market deposits
    
    
    37,286
    
    
    
    191
    
    
    
    2.03
    %
    
    
    25,789
    
    
    
    197
    
    
    
    3.02
    %Savings deposits
    
    
    92,101
    
    
    
    372
    
    
    
    1.60
    %
    
    
    70,001
    
    
    
    318
    
    
    
    1.80
    %Certificates of deposit
    
    
    223,373
    
    
    
    1,852
    
    
    
    3.29
    %
    
    
    212,605
    
    
    
    2,357
    
    
    
    4.40
    %Borrowings
    
    
    30,620
    
    
    
    360
    
    
    
    4.67
    %
    
    
    38,111
    
    
    
    450
    
    
    
    4.68
    %Total interest-bearing liabilities
    
    
    417,569
    
    
    
    2,861
    
    
    
    2.72
    %
    
    
    372,468
    
    
    
    3,399
    
    
    
    3.62
    %Noninterest-bearing liabilitiesOther liabilities
    
    
    43,787
    
    
    
    
    
    
    
    
    
    
    
    44,376Stockholders equity
    
    
    36,529
    
    
    
    
    
    
    
    
    
    
    
    32,129Total liabilities and stockholders equity
    
    $
    497,885
    
    
    
    
    
    
    
    
    
    
    $
    448,973Net interest income
    
    
    
    
    
    $
    3,786
    
    
    
    
    
    
    
    
    
    
    $
    3,152Interest rate spread (2)
    
    
    
    
    
    
    
    
    
    
    3.20
    %
    
    
    
    
    
    
    
    
    
    
    2.80
    %Net yield on interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    3.46
    %
    
    
    
    
    
    
    
    
    
    
    3.20
    %Ratio of average interest-earning assets to
average interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    110.56
    %
    
    
    
    
    
    
    
    
    
    
    112.54
    %
 
 (1)
    
    Interest income and expense are for the period that banking operations were in effect.(2)
    
    Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.(3)
    
    Net yield on interest-earning assets represents net interest income as a percentage of average interest-earning assets.(4)
    
    Average yields are computed using annualized interest income and expense for the periods. 2009 versus 2008Increase (decrease) due toVolume
    
    
    Rate
    
    
    Total(Dollars in thousands)Interest-earning assets:Loans receivable
    
    $
    361
    
    
    $
    (611
    )
    
    $
    (250
    )Investments securities
    
    
    166
    
    
    
    211
    
    
    
    377Interest-bearing deposits with other banks
    
    
    81
    
    
    
    (111
    )
    
    
    (30
    )Total interest-earning assets
    
    
    608
    
    
    
    (510
    )
    
    
    98Interest-bearing liabilities:Interest  bearing demand deposits
    
    
    25
    
    
    
    (16
    )
    
    
    9Money market deposits
    
    
    88
    
    
    
    (94
    )
    
    
    (6
    )Savings deposits
    
    
    100
    
    
    
    (45
    )
    
    
    55Certificates of deposit
    
    
    119
    
    
    
    (624
    )
    
    
    (505
    )Borrowings
    
    
    (88
    )
    
    
    (1
    )
    
    
    (89
    )Total interest-bearing liabilities
    
    
    244
    
    
    
    (781
    )
    
    
    (537
    )Net interest income
    
    $
    364
    
    
    $
    270
    
    
    $
    635
  22




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##### Table of Contents



For the Nine Months Ended September 30,2009
    
    
    2008(4)
    
    
    
    
    
    
    
    
    
    
    (4)Average
    
    
    
    
    
    
    Average
    
    
    Average
    
    
    
    
    
    
    AverageBalance
    
    
    Interest (1)
    
    
    Yield/Cost
    
    
    Balance
    
    
    Interest (1)
    
    
    Yield/Cost(Dollars in thousands)
    
    
    (Dollars in thousands)Interest-earning assets:Loans receivable
    
    $
    330,809
    
    
    $
    15,080
    
    
    
    6.09
    %
    
    $
    316,032
    
    
    $
    16,274
    
    
    
    6.86
    %Investments securities (taxable
equivalent)
    
    
    105,094
    
    
    
    4,128
    
    
    
    6.15
    %
    
    
    95,419
    
    
    
    3,165
    
    
    
    5.40
    %Interest-bearing deposits with other banks
    
    
    11,690
    
    
    
    69
    
    
    
    0.79
    %
    
    
    6,803
    
    
    
    213
    
    
    
    4.17
    %Total interest-earning assets
    
    
    447,592
    
    
    
    19,277
    
    
    
    5.97
    %
    
    
    418,255
    
    
    
    19,651
    
    
    
    6.48
    %Noninterest-earning assets
    
    
    32,339
    
    
    
    
    
    
    
    
    
    
    
    28,141Total assets
    
    $
    479,932
    
    
    
    
    
    
    
    
    
    
    $
    446,396Interest-bearing liabilities:Interest  bearing demand deposits
    
    
    31,076
    
    
    
    224
    
    
    
    0.96
    %
    
    $
    23,310
    
    
    
    220
    
    
    
    1.26
    %Money market deposits
    
    
    33,060
    
    
    
    512
    
    
    
    2.07
    %
    
    
    24,418
    
    
    
    588
    
    
    
    3.21
    %Savings deposits
    
    
    82,272
    
    
    
    954
    
    
    
    1.55
    %
    
    
    71,834
    
    
    
    1,100
    
    
    
    2.04
    %Certificates of deposit
    
    
    222,040
    
    
    
    6,087
    
    
    
    3.67
    %
    
    
    214,270
    
    
    
    7,474
    
    
    
    4.65
    %Borrowings
    
    
    32,249
    
    
    
    1,130
    
    
    
    4.69
    %
    
    
    35,677
    
    
    
    1,289
    
    
    
    4.81
    %Total interest-bearing liabilities
    
    
    400,696
    
    
    
    8,906
    
    
    
    2.97
    %
    
    
    369,509
    
    
    
    10,670
    
    
    
    3.85
    %Noninterest-bearing liabilitiesOther liabilities
    
    
    43,155
    
    
    
    
    
    
    
    
    
    
    
    43,114Stockholders equity
    
    
    36,081
    
    
    
    
    
    
    
    
    
    
    
    33,773Total liabilities and stockholders equity
    
    $
    479,932
    
    
    
    
    
    
    
    
    
    
    $
    446,396Net interest income
    
    
    
    
    
    $
    10,370
    
    
    
    
    
    
    
    
    
    
    $
    8,981Interest rate spread (2)
    
    
    
    
    
    
    
    
    
    
    3.00
    %
    
    
    
    
    
    
    
    
    
    
    2.64
    %Net yield on interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    3.31
    %
    
    
    
    
    
    
    
    
    
    
    3.08
    %Ratio of average interest-earning assets to
average interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    111.70
    %
    
    
    
    
    
    
    
    
    
    
    113.19
    %
 
 (1)
    
    Interest income and expense are for the period that banking operations were in effect.(2)
    
    Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.(3)
    
    Net yield on interest-earning assets represents net interest income as a percentage of average interest-earning assets.(4)
    
    Average yields are computed using annualized interest income and expense for the periods. 2009 versus 2008Increase (decrease) due toVolume
    
    
    Rate
    
    
    Total(Dollars in thousands)Interest-earning assets:Loans receivable
    
    $
    761
    
    
    $
    (1,955
    )
    
    $
    (1,194
    )Investments securities
    
    
    392
    
    
    
    571
    
    
    
    963Interest-bearing deposits with other banks
    
    
    153
    
    
    
    (296
    )
    
    
    (143
    )Total interest-earning assets
    
    
    1,306
    
    
    
    (1,680
    )
    
    
    (374
    )Interest-bearing liabilities:Interest  bearing demand deposits
    
    
    73
    
    
    
    (70
    )
    
    
    4Money market deposits
    
    
    208
    
    
    
    (285
    )
    
    
    (76
    )Savings deposits
    
    
    160
    
    
    
    (305
    )
    
    
    (146
    )Certificates of deposit
    
    
    271
    
    
    
    (1,658
    )
    
    
    (1,387
    )Borrowings
    
    
    (124
    )
    
    
    (35
    )
    
    
    (158
    )Total interest-bearing liabilities
    
    
    589
    
    
    
    (2,353
    )
    
    
    (1,764
    )Net interest income
    
    $
    717
    
    
    $
    672
    
    
    $
    1,389
  23




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##### Table of Contents



LIQUIDITY
   INFLATION
   REGULATORY MATTERS
   REGULATORY CAPITAL REQUIREMENTS
    24




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##### Table of Contents



Middlefield Banc Corp.
    
    
    The Middlefield Banking Co.
    
    
    Emerald BankAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioTotal Capital(to Risk-weighted Assets)Actual
    
    $
    43,285,230
    
    
    
    12.29
    %
    
    $
    34,226,120
    
    
    
    11.25
    %
    
    $
    5,995,871
    
    
    
    12.68
    %For Capital Adequacy Purposes
    
    
    28,184,059
    
    
    
    8.00
    
    
    
    24,335,200
    
    
    
    8.00
    
    
    
    3,783,510
    
    
    
    8.00To Be Well Capitalized
    
    
    35,230,074
    
    
    
    10.00
    
    
    
    30,419,000
    
    
    
    10.00
    
    
    
    4,729,388
    
    
    
    10.00Tier I Capital(to Risk-weighted Assets)Actual
    
    $
    38,852,871
    
    
    
    11.03
    %
    
    $
    31,240,602
    
    
    
    10.27
    %
    
    $
    5,394,259
    
    
    
    11.41
    %For Capital Adequacy Purposes
    
    
    14,092,030
    
    
    
    4.00
    
    
    
    12,167,600
    
    
    
    4.00
    
    
    
    1,891,755
    
    
    
    4.00To Be Well Capitalized
    
    
    21,138,044
    
    
    
    6.00
    
    
    
    18,251,400
    
    
    
    5.00
    
    
    
    2,837,633
    
    
    
    6.00Tier I Capital(to Average Assets)Actual
    
    $
    38,852,871
    
    
    
    8.23
    %
    
    $
    31,240,602
    
    
    
    7.63
    %
    
    $
    5,394,259
    
    
    
    8.87
    %For Capital Adequacy Purposes
    
    
    18,889,515
    
    
    
    4.00
    
    
    
    16,373,113
    
    
    
    4.00
    
    
    
    2,431,925
    
    
    
    4.00To Be Well Capitalized
    
    
    23,611,894
    
    
    
    5.00
    
    
    
    20,466,392
    
    
    
    5.00
    
    
    
    3,039,906
    
    
    
    5.00
 
 Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
 ASSET AND LIABILITY MANAGEMENT
       25




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##### Table of Contents



Increase
    
    
    Decrease200 Basis Points
    
    
    200 Basis PointsNet interest income  increase (decrease)
    
    
    (1.06
    )%
    
    
    7.27
    %Portfolio equity  increase (decrease)
    
    
    (17.19
    )%
    
    
    9.16
    %
 
 Item 4.   Controls and Procedures Disclosure
    Changes in Internal Control over Financial Reporting
  
 PART II  OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
  
  
 Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
   26




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##### Table of Contents



Item 3.
    
    Defaults by the Company on its senior securities
  
 Item 4.
    
    Submission of matters to a vote of security holders
  
 Item 5.
    
    Other information
  
 Item 6.
    
    Exhibits
 Exhibit list for Middlefield Banc Corp.s Form 10-Q Quarterly Report for the Period Ended
September 30, 2009
 exhibitnumber
    
    description
    
    location3.1
    
    
    Second Amended and Restated Articles of
Incorporation of Middlefield Banc Corp.,
as amended
    
    Incorporated by
reference to
Exhibit 3.1 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Fiscal Year
Ended December 31,
2005, filed on
March 29, 20063.2
    
    
    Regulations of Middlefield Banc Corp.
    
    Incorporated by
reference to
Exhibit 3.2 of
Middlefield Banc
Corp.s
registration
statement on Form
10 filed on April
17, 20014.0
    
    
    Specimen stock certificate
    
    Incorporated by
reference to
Exhibit 4 of
Middlefield Banc
Corp.s
registration
statement on Form
10 filed on April
17, 20014.1
    
    
    Amended and Restated Trust Agreement,
dated as of December 21, 2006, between
Middlefield Banc Corp., as Depositor,
Wilmington Trust Company, as Property
trustee, Wilmington Trust Company, as
Delaware Trustee, and Administrative
Trustees
    
    Incorporated by
reference to
Exhibit 4.1 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on December
27, 20064.2
    
    
    Junior Subordinated Indenture, dated as
of December 21, 2006, between
Middlefield Banc Corp. and Wilmington
Trust Company
    
    Incorporated by
reference to
Exhibit 4.2 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on December
27, 20064.3
    
    
    Guarantee Agreement, dated as of
December 21, 2006, between Middlefield
Banc Corp. and Wilmington Trust Company
    
    Incorporated by
reference to
Exhibit 4.3 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on December
27, 200610.1.0
    *
    
    1999 Stock Option Plan of Middlefield
Banc Corp.
    
    Incorporated by
reference to
Exhibit 10.1 of
Middlefield Banc
Corp.s
registration
statement on Form
10 filed on April
17, 200110.1.1
    *
    
    2007 Omnibus Equity Plan
    
    Incorporated by
reference to
Middlefield Banc
Corp.s definitive
proxy statement for
the 2008 Annual
Meeting of
Shareholders,
Appendix A, filed
on April 7, 200810.2
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Thomas G. Caldwell, dated
January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.2 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
2008
  27




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##### Table of Contents



exhibitnumber
    
    description
    
    location10.3
    *
    
    Severance Agreement between Middlefield
Banc Corp. and James R. Heslop, II,
dated January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.3 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.4.0
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Jay P. Giles, dated
January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.4 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.4.1
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Teresa M. Hetrick, dated
January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.4.1 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.4.2
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Jack L. Lester, dated
January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.4.2 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.4.3
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Donald L. Stacy, dated
January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.4.3 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.4.4
    *
    
    Severance Agreement between Middlefield
Banc Corp. and Alfred F. Thompson Jr.,
dated January 7, 2008
    
    Incorporated by
reference to
Exhibit 10.4.4 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.5
    
    
    Federal Home Loan Bank of Cincinnati
Agreement for Advances and Security
Agreement dated September 14, 2000
    
    Incorporated by
reference to
Exhibit 10.4 of
Middlefield Banc
Corp.s
registration
statement on Form
10 filed on April
17, 200110.6
    *
    
    Amended Director Retirement Agreement
with Richard T. Coyne
    
    Incorporated by
reference to
Exhibit 10.6 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.7
    *
    
    Amended Director Retirement Agreement
with Frances H. Frank
    
    Incorporated by
reference to
Exhibit 10.7 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.8
    *
    
    Amended Director Retirement Agreement
with Thomas C. Halstead
    
    Incorporated by
reference to
Exhibit 10.8 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
200810.9
    *
    
    Director Retirement Agreement with
George F. Hasman
    
    Incorporated by
reference to
Exhibit 10.9 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2001,
filed on March 28,
200210.10
    *
    
    Director Retirement Agreement with
Donald D. Hunter
    
    Incorporated by
reference to
Exhibit 10.10 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2001,
filed on March 28,
200210.11
    *
    
    Director Retirement Agreement with
Martin S. Paul
    
    Incorporated by
reference to
Exhibit 10.11 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2001,
filed on March 28,
200210.12
    *
    
    Amended Director Retirement Agreement
with Donald E. Villers
    
    Incorporated by
reference to
Exhibit 10.12 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on January 9,
2008
  28




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##### Table of Contents



exhibitnumber
    
    description
    
    location10.13
    *
    
    Executive Survivor Income Agreement (aka
DBO agreement [death benefit only]) with
Donald L. Stacy
    
    Incorporated by
reference to
Exhibit 10.14 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.14
    *
    
    DBO Agreement with Jay P. Giles
    
    Incorporated by
reference to
Exhibit 10.15 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.15
    *
    
    DBO Agreement with Alfred F. Thompson Jr.
    
    Incorporated by
reference to
Exhibit 10.16 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.16
    *
    
    DBO Agreement with Nancy C. Snow
    
    Incorporated by
reference to
Exhibit 10.17 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.17
    *
    
    DBO Agreement with Theresa M. Hetrick
    
    Incorporated by
reference to
Exhibit 10.18 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.18
    *
    
    DBO Agreement with Jack L. Lester
    
    Incorporated by
reference to
Exhibit 10.19 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.19
    *
    
    DBO Agreement with James R. Heslop, II
    
    Incorporated by
reference to
Exhibit 10.20 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.20
    *
    
    DBO Agreement with Thomas G. Caldwell
    
    Incorporated by
reference to
Exhibit 10.21 of
Middlefield Banc
Corp.s Annual
Report on Form 10-K
for the Year Ended
December 31, 2003,
filed on March 30,
200410.21
    *
    
    Form of Indemnification Agreement with
directors of Middlefield Banc Corp. and
with executive officers of Middlefield
Banc Corp. and The Middlefield Banking
Company
    
    Incorporated by
reference to
Exhibit 99.1 of
Middlefield Banc
Corp.s
registration
statement on Form
10, Amendment No.
1, filed on
September 14, 200110.22
    *
    
    Annual Incentive Plan Summary
    
    Incorporated by
reference to the
summary description
of the annual
incentive plan
included as Exhibit
10.22 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on December
16, 200510.23
    *
    
    Amended Executive Deferred Compensation
Agreement with Thomas G. Caldwell
    
    Incorporated by
reference to
Exhibit 10.23 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on May 9,
200810.24
    *
    
    Amended Executive Deferred Compensation
Agreement with James R. Heslop, II
    
    Incorporated by
reference to
Exhibit 10.24 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on May 9,
2008
  29




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##### Table of Contents



exhibitnumber
    
    description
    
    location10.25
    *
    
    Amended Executive Deferred Compensation
Agreement with Donald L. Stacy
    
    Incorporated by
reference to
Exhibit 10.25 of
Middlefield Banc
Corp.s Form 8-K
Current Report
filed on May 9,
200831.1
    
    
    Rule 13a-14(a) certification of Chief
Executive Officer
    
    filed herewith31.2
    
    
    Rule 13a-14(a) certification of Chief
Financial Officer
    
    filed herewith32
    
    
    Rule 13a-14(b) certification
    
    filed herewith99
    
    
    Report of independent registered public
accounting firm
    
    filed herewith
 *
    
    management contract or compensatory plan or arrangement.  30




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##### Table of Contents



SIGNATURES
  MIDDLEFIELD BANC CORP.Date:   November 12, 2009
    By:

/s/ Thomas G. CaldwellThomas G. CaldwellPresident and Chief Executive OfficerDate:   November 12, 2009
    By:

/s/ Donald L. StacyDonald L. StacyPrincipal Financial and Accounting Officer  31