##### 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 June 30, 2009
 Commission File Number 000-32561
 
 Middlefield Banc Corp.
 (Exact name of registrant as specified in its charter)
 Ohio
(State or other jurisdiction of incorporation 
or organization)
    
    34-1585111
(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 filer
 o
    
    Small reporting company
 þ
 Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). YESoNOþ
 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 August 13, 2009: 1,549,852




---



##### 



MIDDLEFIELD BANC CORP.
 INDEX
 PageNumberPART I   FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Balance Sheet (Unaudited) as of
June 30, 2009 and December 31, 2008
    
    
    3Consolidated Statement of Income (Unaudited)
for the Three and Six Months ended June 30, 2009
and 2008
    
    
    4Consolidated Statement of Changes in Stockholders Equity (Unaudited)
for the Six Months ended June 30, 2009
    
    
    5Consolidated Statement of Cash Flows (Unaudited)
for the Six Months ended June 30, 2009 and 2008
    
    
    6Notes to Unaudited Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    
    17Item 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 31.1Exhibit 31.2Exhibit 32Exhibit 99
   2




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June 30,
    
    
    December 31,2009
    
    
    2008ASSETSCash and due from banks
    
    $
    9,169,682
    
    
    $
    9,795,248Federal funds sold
    
    
    7,530,082
    
    
    
    7,548,000Interest-bearing deposits in other institutions
    
    
    120,056
    
    
    
    112,215Cash and cash equivalents
    
    
    16,819,820
    
    
    
    17,455,463Investment securities available for sale
    
    
    101,635,476
    
    
    
    104,270,366Loans
    
    
    335,513,351
    
    
    
    321,575,293Less allowance for loan losses
    
    
    3,668,122
    
    
    
    3,556,763Net loans
    
    
    331,845,229
    
    
    
    318,018,530Premises and equipment
    
    
    8,300,496
    
    
    
    8,448,915Goodwill
    
    
    4,558,687
    
    
    
    4,558,687Bank-owned life insurance
    
    
    7,569,318
    
    
    
    7,440,687Accrued interest and other assets
    
    
    8,990,338
    
    
    
    7,654,287TOTAL ASSETS
    
    $
    479,719,364
    
    
    $
    467,846,935LIABILITIESDeposits:Noninterest-bearing demand
    
    $
    41,512,139
    
    
    $
    42,357,154Interest-bearing demand
    
    
    30,732,983
    
    
    
    26,404,660Money market
    
    
    34,704,138
    
    
    
    27,845,438Savings
    
    
    87,205,502
    
    
    
    68,968,844Time
    
    
    216,345,304
    
    
    
    229,243,506Total deposits
    
    
    410,500,065
    
    
    
    394,819,602Short-term borrowings
    
    
    1,237,795
    
    
    
    1,886,253Other borrowings
    
    
    30,104,627
    
    
    
    33,903,019Accrued interest and other liabilities
    
    
    2,198,215
    
    
    
    2,178,813TOTAL LIABILITIES
    
    
    444,040,702
    
    
    
    432,787,687STOCKHOLDERS EQUITYCommon stock, no par value; 10,000,000 shares authorized,
1,739,382 and 1,725,381 shares issued
    
    
    27,617,948
    
    
    
    27,301,403Retained earnings
    
    
    15,050,193
    
    
    
    14,786,353Accumulated other comprehensive loss
    
    
    (255,872
    )
    
    
    (294,901
    )Treasury stock, at cost; 189,530 shares in 2009 and 2008
    
    
    (6,733,607
    )
    
    
    (6,733,607
    )TOTAL STOCKHOLDERS EQUITY
    
    
    35,678,662
    
    
    
    35,059,248TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    479,719,364
    
    
    $
    467,846,935
   3




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##### Table of Contents



Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008INTEREST INCOMEInterest and fees on loans
    
    $
    4,906,206
    
    
    $
    5,393,090
    
    
    $
    9,904,308
    
    
    $
    10,848,364Interest-bearing deposits in
other institutions
    
    
    2,272
    
    
    
    3,638
    
    
    
    9,507
    
    
    
    8,841Federal funds sold
    
    
    3,285
    
    
    
    22,982
    
    
    
    7,041
    
    
    
    102,286Investment securities:Taxable interest
    
    
    924,120
    
    
    
    606,382
    
    
    
    1,777,317
    
    
    
    1,171,461Tax-exempt interest
    
    
    453,894
    
    
    
    456,932
    
    
    
    900,218
    
    
    
    910,875Dividends on FHLB stock
    
    
    15,395
    
    
    
    29,612
    
    
    
    30,764
    
    
    
    59,012Total interest income
    
    
    6,305,172
    
    
    
    6,512,636
    
    
    
    12,629,155
    
    
    
    13,100,839INTEREST EXPENSEDeposits
    
    
    2,558,647
    
    
    
    3,098,688
    
    
    
    5,274,867
    
    
    
    6,432,668Short-term borrowings
    
    
    4,511
    
    
    
    7,288
    
    
    
    10,174
    
    
    
    17,183Other borrowings
    
    
    371,475
    
    
    
    407,874
    
    
    
    760,130
    
    
    
    821,985Total interest expense
    
    
    2,934,633
    
    
    
    3,513,850
    
    
    
    6,045,171
    
    
    
    7,271,836NET INTEREST INCOME
    
    
    3,370,539
    
    
    
    2,998,786
    
    
    
    6,583,984
    
    
    
    5,829,003Provision for loan losses
    
    
    260,000
    
    
    
    95,000
    
    
    
    414,000
    
    
    
    170,000NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES
    
    
    3,110,539
    
    
    
    2,903,786
    
    
    
    6,169,984
    
    
    
    5,659,003NONINTEREST INCOMEService charges on deposit accounts
    
    
    466,652
    
    
    
    459,033
    
    
    
    905,565
    
    
    
    924,561Investment securities gains, net
    
    
    
    
    
    
    8,750
    
    
    
    
    
    
    
    8,750Earnings on bank-owned life insurance
    
    
    60,054
    
    
    
    72,374
    
    
    
    128,631
    
    
    
    142,462Other income
    
    
    109,514
    
    
    
    97,060
    
    
    
    225,475
    
    
    
    198,895Total noninterest income
    
    
    636,220
    
    
    
    637,217
    
    
    
    1,259,671
    
    
    
    1,274,668NONINTEREST EXPENSESalaries and employee benefits
    
    
    1,538,004
    
    
    
    1,126,754
    
    
    
    2,908,584
    
    
    
    2,321,173Occupancy expense
    
    
    220,854
    
    
    
    209,403
    
    
    
    475,770
    
    
    
    440,586Equipment expense
    
    
    150,738
    
    
    
    139,326
    
    
    
    273,433
    
    
    
    285,436Data processing costs
    
    
    218,865
    
    
    
    188,785
    
    
    
    467,747
    
    
    
    398,065Ohio state franchise tax
    
    
    123,300
    
    
    
    117,000
    
    
    
    246,600
    
    
    
    234,000FDIC assessment
    
    
    271,119
    
    
    
    28,790
    
    
    
    443,160
    
    
    
    45,692Other expense
    
    
    780,117
    
    
    
    768,916
    
    
    
    1,483,491
    
    
    
    1,369,694Total noninterest expense
    
    
    3,302,997
    
    
    
    2,578,974
    
    
    
    6,298,785
    
    
    
    5,094,646Income before income taxes
    
    
    443,762
    
    
    
    962,029
    
    
    
    1,130,870
    
    
    
    1,839,025Income taxes
    
    
    (17,000
    )
    
    
    179,000
    
    
    
    67,000
    
    
    
    319,000NET INCOME
    
    $
    460,762
    
    
    $
    783,029
    
    
    $
    1,063,870
    
    
    $
    1,520,025EARNINGS PER SHAREBasic
    
    $
    0.30
    
    
    $
    0.51
    
    
    $
    0.69
    
    
    $
    0.99Diluted
    
    
    0.30
    
    
    
    0.51
    
    
    
    0.69
    
    
    
    0.98DIVIDENDS DECLARED PER SHARE
    
    $
    0.26
    
    
    $
    0.26
    
    
    $
    0.52
    
    
    $
    0.51
   4




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##### Table of Contents



AccumulatedOther
    
    
    
    
    
    
    TotalCommon
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury
    
    
    Stockholders
    
    
    ComprehensiveStock
    
    
    Earnings
    
    
    Loss
    
    
    Stock
    
    
    Equity
    
    
    IncomeBalance, December 31, 2008
    
    $
    27,301,403
    
    
    $
    14,786,353
    
    
    $
    (294,901
    )
    
    $
    (6,733,607
    )
    
    $
    35,059,248Net income
    
    
    
    
    
    
    1,063,870
    
    
    
    
    
    
    
    
    
    
    
    1,063,870
    
    
    $
    1,063,870Other comprehensive income:Unrealized gains on available for sale
securities net of taxes of $20,105
    
    
    
    
    
    
    
    
    
    
    39,029
    
    
    
    
    
    
    
    39,029
    
    
    
    39,029Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    1,102,899Stock based compensation expense recognized in earnings
    
    
    30,294
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,294Dividend reinvestment and purchase plan
    
    
    286,251
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    286,251Cash dividends ($0.52 per share)
    
    
    
    
    
    
    (800,030
    )
    
    
    
    
    
    
    
    
    
    
    (800,030
    )Balance, June 30, 2009
    
    $
    27,617,948
    
    
    $
    15,050,193
    
    
    $
    (255,872
    )
    
    $
    (6,733,607
    )
    
    $
    35,678,662
   5




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##### Table of Contents



Six Months EndedJune 30,2009
    
    
    2008OPERATING ACTIVITIESNet income
    
    $
    1,063,870
    
    
    $
    1,520,025Adjustments to reconcile net income to
net cash used for operating activities:Provision for loan losses
    
    
    414,000
    
    
    
    170,000Depreciation
    
    
    293,687
    
    
    
    253,770Amortization of premium and
discount on investment securities
    
    
    (190,860
    )
    
    
    108,373Amortization of deferred loan fees, net
    
    
    (35,342
    )
    
    
    (80,287
    )Earnings on bank-owned life insurance
    
    
    (128,631
    )
    
    
    (142,463
    )Compensation for stock option expense
    
    
    30,294
    
    
    
    7,524Increase in accrued interest receivable
    
    
    104,605
    
    
    
    42,045Decrease in accrued interest payable
    
    
    (222,688
    )
    
    
    (205,513
    )Other, net
    
    
    (343,635
    )
    
    
    (358,975
    )Net cash provided by operating activities
    
    
    985,301
    
    
    
    1,314,499INVESTING ACTIVITIESInvestment securities available for sale:Proceeds from repayments and maturities
    
    
    10,571,248
    
    
    
    8,578,818Purchases
    
    
    (7,686,364
    )
    
    
    (18,144,564
    )Increase in loans, net
    
    
    (15,066,292
    )
    
    
    (10,769,677
    )Purchase of Federal Home Loan Bank stock
    
    
    (14,100
    )
    
    
    (61,500
    )Purchase of premises and equipment
    
    
    (145,269
    )
    
    
    (1,183,218
    )Net cash used for investing activities
    
    
    (12,340,777
    )
    
    
    (21,580,141
    )FINANCING ACTIVITIESNet increase in deposits
    
    
    15,680,463
    
    
    
    11,170,442Increase (decrease) in short-term borrowings, net
    
    
    (648,458
    )
    
    
    4,201,713Repayment of other borrowings
    
    
    (3,798,390
    )
    
    
    (1,739,002
    )Proceeds from other borrowings
    
    
    
    
    
    
    1,000,000Purchase of treasury stock
    
    
    
    
    
    
    (1,350,881
    )Proceeds from dividend reinvestment & purchase plan
    
    
    286,251
    
    
    
    352,860Cash dividends
    
    
    (800,030
    )
    
    
    (781,981
    )Net cash provided by financing activities
    
    
    10,719,836
    
    
    
    12,853,151Decrease in cash and cash equivalents
    
    
    (635,643
    )
    
    
    (7,412,491
    )CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD
    
    
    17,455,463
    
    
    
    17,815,322CASH AND CASH EQUIVALENTS
AT END OF PERIOD
    
    $
    16,819,820
    
    
    $
    10,402,831SUPPLEMENTAL INFORMATIONCash paid during the year for:Interest on deposits and borrowings
    
    $
    6,267,859
    
    
    $
    7,516,559Income taxes
    
    
    275,000
    
    
    
    350,000
   6




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##### Table of Contents



Business Combinations
 Partial Deferral of the Effective Date
of Statement 157 Fair Value Measurements,
 Non-controlling Interests in Consolidated Financial
Statements  an amendment of ARB No. 51
 Disclosures about Derivative Instruments and Hedging
Activities Accounting for
Derivative Instruments and Hedging Activities
  7




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Subsequent Events
 Amendments to FASB Interpretation No. 46(R) Consolidation of Variable Interest
Entities
 The FASB Accounting Standards Codification and the
Hierarchy of Generally Accepted Accounting Principles FASB Accounting
Standards Codification
 Accounting for Convertible Securities with
Beneficial Conversion Features or Contingently Adjusted Conversion Ratios Accounting for Convertible
Securities with Beneficial Conversion Features or Contingently Adjusted Conversion Ratios Application of Issue No. 98-5 to Certain Convertible
Instruments, Accounting for Certain Financial Instruments with Characteristics of
both Liability and Equity
 Accounting for Convertible
Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement
 Determination of the Useful Life of Intangible Assets , Goodwill and Other Intangible Assets
 Determining Whether Instruments Granted in
Share-Based Payment Transactions Are Participating Securities
  8




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Accounting for Assets Acquired and Liabilities
Assumed in a Business Combination That Arise from Contingencies
 Determining Fair Value When the Volume and Level
of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions
That Are Not Orderly
 Interim Disclosures about Fair Value
of Financial Instruments
 Recognition and Presentation of
Other-Than-Temporary Impairments
    Weighted-
    
    
    
    
    
    
    Weighted-average
    
    
    
    
    
    
    averageExercise
    
    
    
    
    
    
    Exercise2009
    
    
    Price
    
    
    2008
    
    
    PriceOutstanding, January 1
    
    
    110,465
    
    
    $
    27.21
    
    
    
    88,211
    
    
    $
    28.34Granted
    
    
    
    
    
    
    
    
    
    
    1,337
    
    
    
    36.25Exercised
    
    
    
    
    
    
    
    
    
    
    (842
    )
    
    
    19.11Forfeited
    
    
    (7,575
    )
    
    
    33.60
    
    
    
    
    
    
    
    Outstanding, June 30
    
    
    102,890
    
    
    $
    26.74
    
    
    
    88,706
    
    
    $
    28.55
  9




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For the Three
    
    
    For the SixMonths Ended
    
    
    Months EndedJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Weighted average common shares
outstanding
    
    
    1,731,490
    
    
    
    1,707,946
    
    
    
    1,729,344
    
    
    
    1,705,266Average treasury stock shares
    
    
    (189,530
    )
    
    
    (177,691
    )
    
    
    (189,530
    )
    
    
    (166,117
    )Weighted average common shares and
common stock equivalents used to
calculate basic earnings per share
    
    
    1,541,960
    
    
    
    1,530,255
    
    
    
    1,539,814
    
    
    
    1,539,149Additional common stock equivalents
(stock options) used to calculate
diluted earnings per share
    
    
    1,578
    
    
    
    18,352
    
    
    
    1,591
    
    
    
    19,345Weighted average common shares and
common stock equivalents used
to calculate diluted earnings per share
    
    
    1,543,538
    
    
    
    1,548,607
    
    
    
    1,541,405
    
    
    
    1,558,494
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For the Three Months Ended
    
    
    For the Six Months EndedJune 30,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008Unrealized holding gains (losses) arising during
the period on securities held
    
    $
    570,161
    
    
    $
    (1,312,215
    )
    
    $
    39,029
    
    
    $
    (1,080,231
    )Reclassification adjustment for gains included in net income
    
    
    
    
    
    
    5,775
    
    
    
    
    
    
    
    5,775Net change in unrealized gains (losses) during the period
    
    
    570,161
    
    
    
    (1,306,440
    )
    
    
    39,029
    
    
    
    (1,074,456
    )Unrealized holding gains and (losses), beginning of period
    
    
    (826,033
    )
    
    
    179,015
    
    
    
    (294,901
    )
    
    
    (52,969
    )Unrealized holding losses, end of period
    
    
    (255,872
    )
    
    
    (1,127,425
    )
    
    
    (255,872
    )
    
    
    (1,127,425
    )Net income
    
    
    460,762
    
    
    
    783,029
    
    
    
    1,063,870
    
    
    
    1,520,025Other comprehensive income, net of tax:Unrealized holding gains (losses) arising during the period
    
    
    570,161
    
    
    
    (1,306,440
    )
    
    
    39,029
    
    
    
    (1,074,456
    )Comprehensive income (loss)
    
    $
    1,030,923
    
    
    $
    (523,411
    )
    
    $
    1,102,899
    
    
    $
    445,569
   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.
  June 30, 2009Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a Recurring Basis:Investment securities available for sale
    
    $
    955,508
    
    
    $
    95,366,104
    
    
    $
    5,313,864
    
    
    $
    101,635,476
  11




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December 31, 2008Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a Recurring Basis:Investment securities available for sale
    
    $
    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 loss
    
    
    (1,366,286
    )Purchases, issuances and settlements
    
    
    Transfers in and/or out of Level III
    
    
    Balance, June 30, 2009
    
    $
    5,313,864The 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
    
    $
    
     12




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##### Table of Contents



June 30, 2009Level I
    
    
    Level II
    
    
    Level III
    
    
    TotalAssets Measured on a non-recurring Basis:Impaired loans
    
    $
    
    
    
    $
    1,342,736
    
    
    $
    2,366,592
    
    
    $
    3,709,328
 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
  June 30, 2009
    
    
    December 30, 2008Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairValue
    
    
    Value
    
    
    Value
    
    
    ValueFinancial assets:Cash and cash equivalents
    
    $
    16,819,820
    
    
    $
    16,819,820
    
    
    $
    17,455,464
    
    
    $
    17,455,464Investment securities
Available for sale
    
    
    101,635,476
    
    
    
    101,635,476
    
    
    
    104,270,366
    
    
    
    104,270,366Net loans
    
    
    331,845,229
    
    
    
    329,576,631
    
    
    
    318,018,530
    
    
    
    317,010,526Bank-owned life insurance
    
    
    7,569,318
    
    
    
    7,569,318
    
    
    
    7,440,687
    
    
    
    7,440,687Federal Home Loan Bank stock
    
    
    1,887,200
    
    
    
    1,887,200
    
    
    
    1,873,100
    
    
    
    1,873,100Accrued interest receivable
    
    
    1,341,769
    
    
    
    1,341,769
    
    
    
    1,446,373
    
    
    
    1,446,373Financial liabilities:Deposits
    
    $
    410,500,065
    
    
    $
    413,061,178
    
    
    $
    394,819,601
    
    
    $
    399,946,594Short-term borrowings
    
    
    1,237,795
    
    
    
    1,237,795
    
    
    
    1,886,253
    
    
    
    1,886,253Other borrowings
    
    
    30,104,627
    
    
    
    32,102,463
    
    
    
    33,903,019
    
    
    
    35,771,019Accrued interest payable
    
    
    1,076,426
    
    
    
    1,076,426
    
    
    
    1,299,114
    
    
    
    1,299,114
      13




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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
  NOTE 6  INVESTMENT SECURITIES AVAILABLE FOR SALE
  June 30, 2009Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueU.S. government agency
securities
    
    $
    3,338,056
    
    
    $
    59,826
    
    
    $
    (46,326
    )
    
    $
    3,351,556Obligations of states and
political subdivisions:Taxable
    
    
    499,644
    
    
    
    8,381
    
    
    
    
    
    
    
    508,025Tax-exempt
    
    
    44,812,145
    
    
    
    524,658
    
    
    
    (840,471
    )
    
    
    44,496,332Mortgage-backed securities
    
    
    52,429,033
    
    
    
    1,368,013
    
    
    
    (1,472,989
    )
    
    
    52,324,057Total debt securities
    
    
    101,078,878
    
    
    
    1,960,878
    
    
    
    (2,359,786
    )
    
    
    100,679,970Equity Securities
    
    
    944,283
    
    
    
    71,425
    
    
    
    (60,202
    )
    
    
    955,506Total
    
    $
    102,023,161
    
    
    $
    2,032,303
    
    
    $
    (2,419,988
    )
    
    $
    101,635,476
  14




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##### Table of Contents



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
    
    $
    1,219,224
    
    
    $
    1,236,760Due after one year through five years
    
    
    7,061,546
    
    
    
    7,360,949Due after five years through ten years
    
    
    12,713,108
    
    
    
    12,872,703Due after ten years
    
    
    80,085,000
    
    
    
    79,209,558Total
    
    $
    101,078,878
    
    
    $
    100,679,970
   June 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
    
    $
    744,797
    
    
    $
    (18,259
    )
    
    $
    971,932
    
    
    $
    (28,068
    )
    
    $
    1,716,729
    
    
    $
    (46,326
    )Obligations of states and
political subdivisions
    
    
    3,643,236
    
    
    
    (119,537
    )
    
    
    19,673,799
    
    
    
    (720,934
    )
    
    
    23,317,035
    
    
    
    (840,471
    )Mortgage-backed securities
    
    
    7,293,546
    
    
    
    (310,390
    )
    
    
    6,675,971
    
    
    
    (1,162,599
    )
    
    
    13,969,517
    
    
    
    (1,472,989
    )Equity securities
    
    
    220,250
    
    
    
    (29,750
    )
    
    
    15,500
    
    
    
    (30,452
    )
    
    
    235,750
    
    
    
    (60,202
    )Total
    
    $
    11,901,829
    
    
    $
    (477,935
    )
    
    $
    27,337,202
    
    
    $
    (1,942,053
    )
    
    $
    39,239,031
    
    
    $
    (2,419,988
    )
  15




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##### Table of Contents



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
    )
     
    
    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
  16




---



##### Table of Contents




    
    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.
  NOTE 7  SUBSEQUENT EVENTS
  
 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.
 Investment securities.
 Loans receivable.
  17




---



##### Table of Contents



Non-performing assets.
 Nonperforming Assets and Allowance for Loan Losses.
 6/30/2009
    
    
    3/31/2009
    
    
    12/31/2008
    
    
    9/30/2008
    
    
    6/30/2008Nonperforming loans
    
    $
    14,023
    
    
    $
    13,370
    
    
    $
    8,481
    
    
    $
    6,749
    
    
    $
    6,530Real estate owned
    
    
    1,967
    
    
    
    1,331
    
    
    
    1,106
    
    
    
    1,108
    
    
    
    911Nonperforming assets
    
    $
    15,991
    
    
    $
    14,701
    
    
    $
    9,587
    
    
    $
    7,857
    
    
    $
    7,441Allowance for loan losses
    
    $
    3,668
    
    
    $
    3,621
    
    
    $
    3,557
    
    
    $
    3,614
    
    
    $
    3,435RatiosNonperforming loans to total loans
    
    
    4.18
    %
    
    
    4.16
    %
    
    
    2.64
    %
    
    
    2.11
    %
    
    
    2.04
    %Nonperforming assets to total
assets
    
    
    3.33
    %
    
    
    3.14
    %
    
    
    2.11
    %
    
    
    1.76
    %
    
    
    1.66
    %Allowance for loan losses to total
loans
    
    
    1.09
    %
    
    
    1.13
    %
    
    
    1.11
    %
    
    
    1.13
    %
    
    
    1.08
    %Allowance for loan losses to
nonperforming loans
    
    
    26.16
    %
    
    
    27.08
    %
    
    
    41.94
    %
    
    
    53.55
    %
    
    
    52.60
    %
  Deposits.
 Borrowed funds.
  18




---



##### Table of Contents



Stockholders equity.
  RESULTS OF OPERATIONS
 General.
   Net interest income.
   Interest income.
    19




---



##### Table of Contents



Interest expense.
 1.
    
    A volume increase in the balance of interest-bearing liabilities of $25.3 million
resulting in $104,000 of additional interest cost.
 2.
    
    The interest rate on interest-bearing liabilities declining by 83 basis points from
3.80% for the second quarter of 2008 to 2.97% for the same period in 2009.
  1.
    
    A volume increase in the balance of interest-bearing liabilities of $24.2 million
resulting in $332,000 of additional interest cost.
 2.
    
    The interest rate on interest-bearing liabilities declining by 85 basis points from
3.96% for the first two quarters of 2008 to 3.11% for the same period in 2009.
     Provision for loan losses.
  20




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##### Table of Contents



Non-interest income.
 Non-interest expense.
  Provision for income taxes.
 CRITICAL ACCOUNTING ESTIMATES
  Average Balance Sheet and Yield/Rate Analysis.
 Analysis of Changes in Net Interest Income.
  21




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##### Table of Contents



For the Three Months Ended June 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
    
    $
    329,124
    
    
    $
    4,906
    
    
    
    5.98
    %
    
    $
    318,134
    
    
    $
    5,393
    
    
    
    6.80
    %Investments securities (taxable equivalent)
    
    
    103,752
    
    
    
    1,378
    
    
    
    6.23
    %
    
    
    97,444
    
    
    
    1,076
    
    
    
    5.39
    %Interest-bearing deposits with other banks
    
    
    7,493
    
    
    
    21
    
    
    
    1.12
    %
    
    
    4,785
    
    
    
    53
    
    
    
    4.41
    %Total interest-earning assets
    
    
    440,369
    
    
    
    6,305
    
    
    
    5.96
    %
    
    
    420,363
    
    
    
    6,522
    
    
    
    6.45
    %Noninterest-earning assets
    
    
    36,177
    
    
    
    
    
    
    
    
    
    
    
    27,425Total assets
    
    $
    476,547
    
    
    
    
    
    
    
    
    
    
    $
    447,788Interest-bearing liabilities:Interest-bearing demand deposits
    
    $
    31,315
    
    
    
    76
    
    
    
    0.97
    %
    
    $
    22,911
    
    
    
    68
    
    
    
    1.19
    %Money market deposits
    
    
    33,097
    
    
    
    170
    
    
    
    2.06
    %
    
    
    24,419
    
    
    
    186
    
    
    
    3.06
    %Savings deposits
    
    
    83,310
    
    
    
    336
    
    
    
    1.62
    %
    
    
    72,012
    
    
    
    323
    
    
    
    1.80
    %Certificates of deposit
    
    
    216,641
    
    
    
    1,977
    
    
    
    3.66
    %
    
    
    216,920
    
    
    
    2,522
    
    
    
    4.66
    %Borrowings
    
    
    31,606
    
    
    
    376
    
    
    
    4.78
    %
    
    
    34,448
    
    
    
    415
    
    
    
    4.83
    %Total interest-bearing liabilities
    
    
    395,968
    
    
    
    2,935
    
    
    
    2.97
    %
    
    
    370,710
    
    
    
    3,514
    
    
    
    3.80
    %Noninterest-bearing liabilitiesOther liabilities
    
    
    45,359
    
    
    
    
    
    
    
    
    
    
    
    42,708Stockholders equity
    
    
    35,220
    
    
    
    
    
    
    
    
    
    
    
    34,370Total liabilities and stockholders equity
    
    $
    476,547
    
    
    
    
    
    
    
    
    
    
    $
    447,788Net interest income
    
    
    
    
    
    $
    3,370
    
    
    
    
    
    
    
    
    
    
    $
    3,008Interest rate spread (2)
    
    
    
    
    
    
    
    
    
    
    2.98
    %
    
    
    
    
    
    
    
    
    
    
    2.64
    %Net yield on interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    3.28
    %
    
    
    
    
    
    
    
    
    
    
    3.09
    %Ratio of average interest-earning assets to
average interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    111.21
    %
    
    
    
    
    
    
    
    
    
    
    113.39
    %
 
 (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
    
    $
    186
    
    
    $
    (673
    )
    
    $
    (487
    )Investments securities
    
    
    85
    
    
    
    217
    
    
    
    302Interest-bearing deposits with other banks
    
    
    30
    
    
    
    (62
    )
    
    
    (32
    )Total interest-earning assets
    
    
    301
    
    
    
    (518
    )
    
    
    (217
    )Interest-bearing liabilities:Interest-bearing demand deposits
    
    
    25
    
    
    
    (17
    )
    
    
    8Money market deposits
    
    
    66
    
    
    
    (82
    )
    
    
    (16
    )Savings deposits
    
    
    51
    
    
    
    (38
    )
    
    
    13Certificates of deposit
    
    
    (3
    )
    
    
    (542
    )
    
    
    (545
    )Borrowings
    
    
    (34
    )
    
    
    (4
    )
    
    
    (39
    )Total interest-bearing liabilities
    
    
    104
    
    
    
    (683
    )
    
    
    (579
    )Net interest income
    
    $
    196
    
    
    $
    165
    
    
    $
    362
  22




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##### Table of Contents



For the Six Months Ended June 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
    
    $
    326,223
    
    
    $
    9,904
    
    
    
    6.12
    %
    
    $
    314,668
    
    
    $
    10,848
    
    
    
    6.91
    %Investments securities (taxable equivalent)
    
    
    104,362
    
    
    
    2,678
    
    
    
    6.07
    %
    
    
    95,862
    
    
    
    2,100
    
    
    
    5.37
    %Interest-bearing deposits with other banks
    
    
    9,030
    
    
    
    47
    
    
    
    1.06
    %
    
    
    7,257
    
    
    
    161
    
    
    
    4.46
    %Total interest-earning assets
    
    
    439,616
    
    
    
    12,629
    
    
    
    6.01
    %
    
    
    417,787
    
    
    
    13,109
    
    
    
    6.52
    %Noninterest-earning assets
    
    
    34,167
    
    
    
    
    
    
    
    
    
    
    
    27,171Total assets
    
    $
    473,783
    
    
    
    
    
    
    
    
    
    
    $
    444,958Interest-bearing liabilities:Interest-bearing demand deposits
    
    
    29,519
    
    
    
    137
    
    
    
    0.94
    %
    
    $
    21,983
    
    
    
    142
    
    
    
    1.30
    %Money market deposits
    
    
    30,947
    
    
    
    321
    
    
    
    2.09
    %
    
    
    23,732
    
    
    
    391
    
    
    
    3.31
    %Savings deposits
    
    
    77,358
    
    
    
    582
    
    
    
    1.52
    %
    
    
    72,750
    
    
    
    765
    
    
    
    2.11
    %Certificates of deposit
    
    
    221,374
    
    
    
    4,235
    
    
    
    3.86
    %
    
    
    215,103
    
    
    
    5,134
    
    
    
    4.79
    %Borrowings
    
    
    33,063
    
    
    
    770
    
    
    
    4.70
    %
    
    
    34,460
    
    
    
    839
    
    
    
    4.88
    %Total interest-bearing liabilities
    
    
    392,260
    
    
    
    6,045
    
    
    
    3.11
    %
    
    
    368,028
    
    
    
    7,271
    
    
    
    3.96
    %Noninterest-bearing liabilitiesOther liabilities
    
    
    46,303
    
    
    
    
    
    
    
    
    
    
    
    42,632Stockholders equity
    
    
    35,220
    
    
    
    
    
    
    
    
    
    
    
    34,298Total liabilities and stockholders equity
    
    $
    473,783
    
    
    
    
    
    
    
    
    
    
    $
    444,958Net interest income
    
    
    
    
    
    $
    6,584
    
    
    
    
    
    
    
    
    
    
    $
    5,838Interest rate spread (2)
    
    
    
    
    
    
    
    
    
    
    2.90
    %
    
    
    
    
    
    
    
    
    
    
    2.56
    %Net yield on interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    3.23
    %
    
    
    
    
    
    
    
    
    
    
    3.03
    %Ratio of average interest-earning assets to
average interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    112.07
    %
    
    
    
    
    
    
    
    
    
    
    113.52
    %
 
 (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
    
    $
    398
    
    
    $
    (1,342
    )
    
    $
    (944
    )Investments securities
    
    
    228
    
    
    
    350
    
    
    
    578Interest-bearing deposits with other banks
    
    
    39
    
    
    
    (153
    )
    
    
    (114
    )Total interest-earning assets
    
    
    665
    
    
    
    (1,145
    )
    
    
    (480
    )Interest-bearing liabilities:Interest-bearing demand deposits
    
    
    49
    
    
    
    (54
    )
    
    
    (5
    )Money market deposits
    
    
    119
    
    
    
    (189
    )
    
    
    (70
    )Savings deposits
    
    
    48
    
    
    
    (232
    )
    
    
    (183
    )Certificates of deposit
    
    
    150
    
    
    
    (1,049
    )
    
    
    (899
    )Borrowings
    
    
    (34
    )
    
    
    (35
    )
    
    
    (69
    )Total interest-bearing liabilities
    
    
    332
    
    
    
    (1,558
    )
    
    
    (1,226
    )Net interest income
    
    $
    333
    
    
    $
    413
    
    
    $
    746
  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
    
    $
    42,962,580
    
    
    
    12.61
    %
    
    $
    33,444,950
    %
    
    $
    11.41
    %
    
    $
    7,243,864
    
    
    
    15.29
    %For Capital Adequacy
Purposes
    
    
    27,246,720
    
    
    
    8.00
    
    
    
    23,443,360
    
    
    
    8.00
    
    
    
    3,789,033
    
    
    
    8.00To Be Well Capitalized
    
    
    34,058,400
    
    
    
    10.00
    
    
    
    29,304,200
    
    
    
    10.00
    
    
    
    4,736,292
    
    
    
    10.00Tier I Capital
(to Risk-weighted Assets)Actual
    
    $
    39,289,407
    
    
    
    11.54
    %
    
    $
    30,550,188
    %
    
    $
    10.43
    %
    
    $
    6,649,589
    
    
    
    14.04
    %For Capital Adequacy
Purposes
    
    
    13,623,360
    
    
    
    4.00
    
    
    
    11,721,680
    
    
    
    4.00
    
    
    
    1,894,517
    
    
    
    4.00To Be Well Capitalized
    
    
    20,435,040
    
    
    
    6.00
    
    
    
    17,582,520
    
    
    
    5.00
    
    
    
    2,841,775
    
    
    
    6.00Tier I Capital
(to Average Assets)Actual
    
    $
    39,289,407
    
    
    
    8.42
    %
    
    $
    30,550,188
    %
    
    $
    7.56
    %
    
    $
    6,649,589
    
    
    
    11.20
    %For Capital Adequacy
Purposes
    
    
    18,657,991
    
    
    
    4.00
    
    
    
    16,168,517
    
    
    
    4.00
    
    
    
    2,375,816
    
    
    
    4.00To Be Well Capitalized
    
    
    23,322,489
    
    
    
    5.00
    
    
    
    20,210,646
    
    
    
    5.00
    
    
    
    2,969,769
    
    
    
    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)
    
    
    (2.14)
    %
    
    
    6.97
    %Portfolio equity  increase (decrease)
    
    
    (6.97)
    %
    
    
    (3.56)
    %
 
  Controls and Procedures Disclosure
    Changes in Internal Control over Financial Reporting
  
  
   
  
    26




---



##### Table of Contents



Name
    
    Shares For
    
    
    Shares WithheldRichard T. Coyne
    
    
    1,066,174
    
    
    
    14,323James R. Heslop, II
    
    
    1,068,820
    
    
    
    11,676Robert Toth
    
    
    1,073,156
    
    
    
    7,341
  
   
  Exhibit list for Middlefield Banc Corp.sForm 10-QQuarterly Report for the Period Ended June
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, 2006
  27




---



##### Table of Contents



exhibitnumber
    
    description
    
    location4.2
    
    
    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,
200810.3
    *
    
    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,
2008
  28




---



##### Table of Contents



exhibitnumber
    
    description
    
    location10.8*
    
    
    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,
200810.13*
    
    
    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,
2004
  29




---



##### Table of Contents



exhibitnumber
    
    description
    
    location10.20
    *
    
    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 June
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,
200810.25
    *
    
    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




---



##### Table of Contents



SIGNATURES
  MIDDLEFIELD BANC CORP.Date:   August 13, 2009
    By:
    /s/ Thomas G. CaldwellThomas G. CaldwellPresident and Chief Executive OfficerDate:   August 13, 2009
    By:
    /s/ Donald L. StacyDonald L. StacyPrincipal Financial and Accounting Officer  31




---



##### Table of Contents



EXHIBIT INDEX
 exhibit number
    
    description
    
    location31.1
    
    
    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
  32