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                                                                    EXHIBIT 10.4

                        FARMERS & MERCHANTS BANCORP, INC.
                               CHANGE IN CONTROL -
                        SEVERANCE COMPENSATION AGREEMENT

     This is a Change in Control - Severance Compensation Agreement (the
"Agreement") made by and between Farmers & Merchants Bancorp, Inc. ("Company")
and Rex D. Rice ("Executive").

                                    RECITALS

     WHEREAS, Company is a bank holding company which is engaged in the business
of banking and businesses incidental thereto.

     WHEREAS, Executive possesses unique skills, knowledge and experience
relating to the business of the Company and is presently employed by the Company
or one or more of its subsidiaries.

     WHEREAS, Company desires to recognize the past and future services of
Executive, and, in that connection, Executive desires to be assured that, in the
event of a change in the control of Company, Executive will be provided with an
adequate severance payment for termination without cause or as compensation for
Executive's severance because of a material change in his duties and functions.

     WHEREAS, Company desires to be assured of the objectivity of Executive in
evaluating a potential change of control and advising whether or not a potential
change of control is in the best interest of Company and its shareholders.

     WHEREAS, Company desires to induce Executive to remain in the employ of the
Company following a change of control to provide for continuity of management.

     NOW, THEREFORE, in consideration of the premises and of their mutual
covenants expressed in this Agreement, the parties hereto make the following
agreement, intending to be legally bound thereby:

SECTION 1 - DEFINITIONS

A.   Board - "Board" shall mean the Board of Directors of Farmers & Merchants
     Bancorp, Inc.

B.   Cause - "Cause" shall mean and be limited to Executive's (a) criminal
     dishonesty, (b) failure to perform his duties on an exclusive and
     substantially full-time basis (unless unable to so perform by reason of
     disability), (c) failure to act in accordance with any specific substantive
     instructions given by Company with respect to Executive's performance of
     duties normally associated with his position prior to the Change in Control
     (unless unable to so perform by reason of disability), or (d) engaging in
     conduct which

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     could be materially damaging to Company without a reasonable good faith
     belief that such conduct was in the best interest of Company.

C.   Change in Control - A "Change in Control" shall have the meaning set forth
     on Exhibit A.

D.   Code - "Code" shall mean the Internal Revenue Code of 1986, as amended from
     time to time.

E.   Company - "Company" shall mean Farmers & Merchants Bancorp, Inc. and,
     except in connection with the definition of Change in Control, any members
     of its Affiliated Group, as that term is defined in Section 1504 of the
     Code, and shall include any predecessor corporations of the Company and its
     Affiliated Group.

F.   Disability - "Disability" shall mean disability as determined under the
     plans, policies or programs applicable to the Executive and if no such
     plan, policy or program exists, "disability" shall mean the Executive is
     unable to perform the material and substantial functions or duties of the
     Executive's position due a medical condition (including mental conditions).

G.   Exchange Act - "Exchange Act" means The Securities Exchange Act of 1934.

H.   One Year of Compensation - "One Year of Compensation" means the annual
     equivalent of the highest rate of the Executive's salary in effect during
     the one-year period ending with the date of the Change in Control, and the
     average amount, paid in cash as bonus and other incentive compensation for
     the three year period ending with the date of the Change in Control. "One
     Year of Compensation" shall not include any amount, other than salary and
     cash bonuses or cash incentive compensation, that may be included in
     Executive's taxable compensation for federal income tax purposes and
     reported to Executive and Internal Revenue Service ("IRS") such as the
     reporting of previously deferred compensation or gain realized upon
     exercise of any non qualified stock options.

SECTION 2 - TERM OF AGREEMENT.

This Agreement shall be effective from the date hereof, until the termination of
employment of the Executive for any reason, or two years following a Change in
Control. Notwithstanding the forgoing, the obligations of the Company pursuant
to Section 4 of this Agreement shall survive such termination insofar as
provided thereunder. This Agreement shall not change, alter or amend any rights
which either Company or Executive may have in respect of the termination of the
employment of Executive by Company prior to a Change in Control. Nothing
contained in this Agreement shall be construed to create any additional right or
obligation of Executive to be employed by Company.

In addition to the forgoing this Agreement shall terminate on the date which the
Company or any other member of its Affiliated Group, and over which Executive
has managerial control, or which employs Executive, and which is a depository
institution that is insured by an agency of any state or the United States
Federal Government:


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     1.   becomes insolvent; or

     2.   has appointed any conservator or receiver; or

     3.   is determined by an appropriate federal banking agency to be in a
          troubled condition, as defined in the applicable law and regulations;
          or

     4.   is assigned a composite rating of 4 or 5 by the appropriate federal
          banking agency or is informed in writing by the Federal Deposit
          Insurance Corporation that it is rated a 4 or 5 under the Uniform
          Financial Institution's Rating System of the Federal Financial
          Institutions Examination Council; or

     5.   has initiated against it by the Federal Deposit Insurance Corporation
          a proceeding to terminate or suspend deposit insurance; or

     6.   reasonably determines in good faith and with due care that the
          payments called for under this Agreement, or the obligations and
          promises assumed and made under this Agreement have become proscribed
          under applicable law or regulations. Provided, however, if such law or
          regulations apply prospectively only, or for some other reason do not
          apply to this Agreement, then this Agreement shall not be deemed by
          Company to be proscribed.

SECTION 3 - REDUCTION IN COMPENSATION PROSCRIBED AFTER A CHANGE IN CONTROL

During the term of this Agreement from the date of a Change in Control forward,
Executive shall receive as compensation, while still employed by Company, a
salary at a rate no less than the highest rate in effect during the one-year
period before the Change in Control, and shall, in addition, be entitled to
receive a bonus equal to at least the average of the last three years of bonuses
paid before the Change in Control. In addition, during such period, the Company
shall provide for Executive all of the fringe benefits and other perquisites as
provided to any similarly situated employee of the Company, including but not
limited to retirement benefits, health, disability, dental, life insurance, club
memberships, etc., all of which shall be at levels and amounts no less favorable
than levels and amounts in effect as of the Change in Control and at the same
cost to Executive as provided to any similarly situated employee of Company.

SECTION 4 - PAYMENTS AND BENEFITS FOR TERMINATION OF EMPLOYMENT RELATED TO A
CHANGE IN CONTROL

A.   If during the term of this Agreement and:

     1.   within four (4) months before the date of a Change in Control,
          Executive resigns because he has: (i) had his compensation reduced, or
          (ii) had his principal place of employment transferred to a location
          greater than sixty (60) miles from the main office of the Company
          which is located at 307-11 N. Defiance Street, Archbold, Ohio.;


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     2.   within two (2) years after the date of a Change in Control, Executive
          is discharged without Cause or Executive resigns because he has: (i)
          had his compensation reduced or, (ii) had his principal place of
          employment transferred to a location greater than sixty (60) miles
          from the main office of the Company which is located at 307-11 N.
          Defiance Street, Archbold, Ohio; or

     3.   within one year before the date of a Change in Control, the Executive
          is discharged by Company other than for Cause;

     then the Company shall make the payments to Executive set forth in
     subsection B of this Section 4.

B.   In the event of the termination of Executive's employment as described in
     Section 4.A. Executive shall be entitled to receive One Year of
     Compensation paid in a single lump sum payment within fourteen (14) days of
     the later of termination of employment of the Executive or the occurrence
     of the Change in Control.

C.   If Executive's employment is terminated as described in Section 4.A. (1 or
     2), then in addition to the above cash payment(s), Company shall continue
     at no cost to Executive for the term of the Benefit Period as defined
     below, Executive's coverage in Company's health, disability, dental, and
     life insurance at the same levels that had been provided immediately prior
     to his termination of employment. The Benefit Period shall commence on the
     date of termination of the Executive's employment and shall end on the last
     day of the 12th consecutive whole month thereafter.

D.   In the event Executive dies before collecting all amounts and benefits due
     under this Section, any payments owed shall be paid to the person or
     persons as stated in the last designation of beneficiary concerning this
     Agreement signed by Executive and filed with Company, and if no such
     designation has been made, then to the surviving spouse, and if there is no
     surviving spouse, to his/her estate.

E.   Except as otherwise provided in Section 7, the payments and benefits
     provided for herein are in lieu of compensation, benefits or amounts the
     Executive might otherwise be entitled to from the Company by reason of
     termination of employment (except as required or mandated by law).

F.   In the event the payments required under this Agreement, when added
     together with any other amounts required to be included by Executive under
     the provisions of the Code, result in an "Excess Parachute Payment," as
     that term is defined in Section 280G of the Code, then the amount of the
     payments provided for in this Agreement shall be increased in an amount
     sufficient to fully reimburse the Executive for any excise tax imposed
     under Section 4999 (or any successor thereto) of the Code and otherwise
     payable by the Executive.


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G.   Any subsequent employment by Executive shall not reduce the obligation of
     the Company to make the full payments and provide the full benefits
     specified herein and Executive shall have no obligation to seek other
     employment or otherwise mitigate the effect of his discharge from
     employment.

H.   Notwithstanding the provisions of this agreement providing for payment of
     benefits, if at the time a benefit would otherwise be payable, Employee is
     a "specified employee" [as defined below], and the payment provided for
     would be deferred compensation with the meaning of the Internal Revenue
     Code (the "Code"), section 409A, the distribution of the Employee's benefit
     may not be made until six months after the date of the Employee's
     "separation from service" with the Company [as that term may be defined in
     Section 409A(a)(2)(A)(i) of the Code and regulations promulgated
     thereunder], or, if earlier the date of death of the Employee. This
     requirement shall remain in effect only for periods in which the stock of
     the Company is publicly traded on an established securities market. For
     purposes of this subsection a "specified employee" shall mean any Employee
     of the Company who is a "key employee" of the Company within the meaning of
     Code section 416(i). This shall include any Employee who is (i) a 5-percent
     owner of the Company's common stock, or (ii) an officer of the Company with
     annual compensation from the Company of $130,000.00 or more, or (iii) a
     1-percent owner of Company's common stock with annual compensation from the
     Company of $150,000.00 or more (or such higher annual limit as may be in
     effect for years subsequent to 2005 pursuant to indexing section 416(i) of
     the Code). The provisions of this subsection providing for a delay in
     payment have been adopted only in order to comply with Code section 409A.
     These provisions shall be interpreted and administered in a manner
     consistent with the requirements of Code section 409A, together with any
     regulations or other guidance which may be published by the Treasury
     Department or Internal Revenue Service interpreting such Code section 409A
     and the delay in payment provided for hereunder shall only be applicable to
     the extent that, and with respect to the portion of which, such payments
     are proscribed thereby.

I.   Notwithstanding anything in this Agreement to the contrary, in the event
     any payment called for under the terms hereof is prohibited by law,
     including 12 CFR Part 359 of the Code of Federal Regulations, the Company
     shall have no obligation to make such payment to the extent of such
     prohibition.

SECTION 5 - PROVISION FOR OUTPLACEMENT SERVICES

In the event of the termination of employment of Executive as specified in
Section 4.A. (1 and 2) of this Agreement, Executive shall be entitled to six
months of out-placement services following termination of employment. Such
services shall include employment counseling, resume services, executive
placement services and similar services generally provided to executives by
professional executive out placement service providers. All costs of such out
placement services shall be paid for by the Company.


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SECTION 6 - ARBITRATION

The parties hereto agree to arbitrate any issue, misunderstanding, disagreement
or dispute with respect to the terms of this Agreement before an arbitrator or
an arbitration panel as hereinafter provided. The parties may agree to one
mutually acceptable arbitrator. If the parties have been unable to agree upon
one arbitrator, then each party may appoint one arbitrator and the two appointed
arbitrators shall appoint a third neutral arbitrator. If the arbitrators
selected by the parties are unable or fail to agree upon the third arbitrator,
an Ohio common pleas court judge located in Fulton County Ohio chosen at random
shall select the third arbitrator. Failure by a party to appoint an arbitrator,
within 30 days of receipt of notice of the appointment of an arbitrator by the
other party, shall be deemed as acceptance of arbitration by such single
arbitrator. The arbitration shall occur in Archbold, Ohio, or such other place
as mutually agreed upon. The prevailing party shall be entitled to recover any
and all costs associated with any arbitration proceeding (and any subsequent
proceeding to enforce rights thereunder) including the recovery of reasonable
attorneys fees. Judgment on the award rendered by the arbitrator(s) may be
entered by any court having jurisdiction thereof.

SECTION 7 - RIGHT TO OTHER BENEFITS

Nothing in this Agreement shall abridge, eliminate, or cause Executive to lose
Executive's right or entitlement to any other Company benefit to which Executive
may be entitled due to his status as an employee under any plan or policy of
Company on such terms and conditions as are required of any employee under any
plan or policy of Company. Further, nothing in this Agreement shall create in
Executive any greater rights or entitlements, except as specified in this
Agreement. The plans and policies referred to in this Section 7 include, but are
not limited to, qualified and nonqualified retirement plans, life insurance
plans, dental, disability or health insurance benefits, severance policies, and
accrued vacation pay.

SECTION 8 - MISCELLANEOUS

A.   Notice and Payments

     All payments required or permitted to be made under the provisions of this
     Agreement, and all notices and other communications required or permitted
     to be given or delivered under this Agreement to Company or to Executive,
     which notices or communications must be in writing, shall be deemed to have
     been given if delivered by hand, or mailed by first-class mail, addressed
     as follows:

     1. If to Company:

        Farmers & Merchants State Bank
        Attn: Chairman, Compensation Committee
        307-11 N. Defiance Street
        Box 216
        Archbold, OH 43502


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     2. If to Executive:
        Rex D. Rice
        710 Pine St.
        Wauseon, OH 43567

     Company or Executive may, by notice given to the other from time to time
     and at any time, designate a different address for making payments required
     to be made, and for the giving of notices or other communications required
     or permitted to be given, to the party designating such new address.

B.   Payroll Taxes

     Any payment required or permitted to be made or given to Executive under
     this Agreement shall be subject to the withholding and other requirements
     of applicable laws, and to the deduction requirements of any benefit plan
     maintained by Company in which Executive is a participant, and to all
     reporting, filing and other requirements in respect of such payments, and
     Company shall use its best efforts promptly to satisfy all such
     requirements.

C.   Governing Law

     This Agreement shall be governed by and construed in accordance with the
     laws of the State of Ohio.

D.   Duplicate Originals

     This Agreement may be executed in one or more counterparts, each of which
     shall be deemed to be a duplicate original, but all of which, taken
     together, shall constitute a single instrument.

E.   Captions

     The captions contained in this Agreement are included only for convenience
     of reference and do not define, limit, explain or modify this Agreement or
     its interpretations, construction or meaning and are in no way to be
     construed as a part of this Agreement.

F.   Severability

     If any provision of this Agreement or the application of any provision to
     any person or any circumstances shall be determined to be invalid or
     unenforceable, such provision or portion thereof shall nevertheless be
     effective and enforceable to the extent determined reasonable. Such
     determination shall not affect any other provision of this Agreement or the
     application of said provision to any other person or circumstance, all of
     which other provisions shall


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     remain in full force and effect, and it is the intention of Company and
     Executive that if any provision of this Agreement is susceptible of two or
     more constructions, one of which would render the provision enforceable and
     the other or others of which would render the provisions unenforceable,
     then the provisions shall have the meaning which renders it enforceable.

G.   Number and Gender

     When used in this Agreement, the number and gender of each pronoun shall be
     construed to be such number and gender as the context, circumstances or its
     antecedent may require.

H.   Successors and Assigns

     This Agreement shall inure to the benefit of and be binding upon the
     successors and assigns (including successive, as well as immediate,
     successors and assigns) of Company; provided, however, that Company may not
     assign this Agreement or any of its rights or obligations hereunder to any
     party other than a corporation which succeeds to substantially all of the
     business and assets of Company by merger, consolidation, sale of assets or
     otherwise. This Agreement shall inure to the benefit of and be binding upon
     the successor and assigns (including successive, as well as immediate,
     successors and assigns) of Executive; provided, however, that the right of
     Executive under this Agreement may be assigned only to his personal
     representative or trustee or by will or pursuant to applicable laws of
     descent and distribution.

I.   Prior Agreement

     This Agreement supersedes the prior Change in Control Agreement between
     Farmers & Merchants State Bank and Executive.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on and to be effective on November 27, 2007.

IN THE PRESENCE OF:                     EXECUTIVE


-------------------------------------   ----------------------------------------
                                        Rex D Rice
-------------------------------------


IN THE PRESENCE OF:                     FARMERS & MERCHANTS
                                        BANCORP, INC.


                                        By:
-------------------------------------       ------------------------------------
                                        Its: President & Chief Executive Officer
-------------------------------------


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<PAGE>

Exhibit A
Change in Control Definition

A "Change in Control" shall mean a "Change in Ownership" as defined in (a)
hereof; a "Change in Effective Control" as defined in (b), hereof; or a "Change
in Ownership of a Substantial Portion of Assets" as defined in (c) hereof.

     (a)  Change in Ownership. For purposes of this Agreement, a change in the
          ownership of the Company occurs on the date -

          (i)  that any one person, or more than one person acting as a group
               (as defined in subsection (d) hereof), acquires ownership of
               stock of the Company that, together with stock held by such
               person or group, constitutes more than 50 percent of the total
               fair market value or total voting power of the stock of the
               Company. However, if any one person, or more than one person
               acting as a group, is considered to own more than 50 percent of
               the total fair market value or total voting power of the stock of
               the Company, the acquisition of additional stock by the same
               person or persons is not considered to cause a change in the
               ownership of the Company (or to cause a change in the effective
               control of the Company within the meaning of subsection (b)
               hereof). An increase in the percentage of stock owned by any one
               person, or persons acting as a group, as a result of a
               transaction in which the Company acquires its stock in exchange
               for property will be treated as an acquisition of stock for
               purposes of this section.

          (ii) of the consummation of any merger, consolidation or
               reorganization with any other corporation pursuant to which the
               shareholders of the Company immediately prior to the merger,
               consolidation or reorganization do not immediately thereafter
               directly or indirectly own more than fifty percent of the
               combined voting power of the voting securities entitled to vote
               in the election of directors of the merged, consolidated or
               reorganized entity.

     (b)  Change in the Effective Control. For purposes of this Agreement, a
          change in the effective control of the Company occurs on the date that
          either -

          (i)  Any one person, or more than one person acting as a group (as
               determined under subsection (d) hereof), acquires (or has
               acquired during the 12-month period ending on the date of the
               most recent acquisition by such person or persons) ownership of
               stock of the Company possessing 35 percent or more of the total
               voting power of the stock of the Company; or

          (ii) a majority of members of the Company's board of directors is
               replaced during any 12-month period by directors whose
               appointment or election is not endorsed by a majority of the
               members of the Company's board of directors prior to the date of
               the appointment or election.

          In the absence of an event described in subsection (b)(i) or (ii)
          above, a change in the effective control of a Company will not have
          occurred.

     (c)  Change in the Ownership of a Substantial Portion of the Company's
          Assets. For purposes of this Agreement, a change in the ownership of a
          substantial portion of the Company's assets occurs on the date that
          any one person, or more than one person acting as a group (as
          determined in subsection(d) hereof), acquires (or has acquired during
          the 12-month period ending on the date of the most recent acquisition
          by such person or persons) assets from the Company that have a total
          gross fair market value equal to or more than 40 percent of the total
          gross fair market value of all of the assets of the Company
          immediately prior to such acquisition or acquisitions. For this


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          purpose, gross fair market value means the value of the assets of the
          Company, or the value of the assets being disposed of, determined
          without regard to any liabilities associated with such assets.

          There is no Change in Control Event under this subsection (c) when
          there is a transfer to an entity that is controlled by the
          shareholders of the Company immediately after the transfer, as
          provided in this paragraph. A transfer of assets by the Company is not
          treated as a change in the ownership of such assets if the assets are
          transferred to --

          (i)  A shareholder of the Company (immediately before the asset
               transfer) in exchange for or with respect to its stock;

          (ii) An entity, 50 percent or more of the total value or voting power
               of which is owned, directly or indirectly, by the Company;

          (iii) A person, or more than one person acting as a group, that owns,
               directly or indirectly, 50 percent or more of the total value or
               voting power of all the outstanding stock of the Company; or

          (iv) An entity, at least 50 percent of the total value or voting power
               of which is owned, directly or indirectly, by a person described
               in section (iii) above.

          For purposes of this subsection (c) and except as otherwise provided,
          a person's status is determined immediately after the transfer of the
          assets. For example, a transfer to a corporation in which the
          transferor corporation has no ownership interest before the
          transaction, but which is a majority-owned subsidiary of the
          transferor corporation after the transaction is not treated as a
          change in the ownership of the assets of the transferor corporation.

     (d)  Persons Acting as a Group. Persons will not be considered to be acting
          as a group solely because they purchase assets or purchase or own
          stock of the same corporation at the same time, or as a result of the
          same public offering. However, persons will be considered to be acting
          as a group if they are owners of a corporation that enters into a
          merger, consolidation, purchase or acquisition of stock, purchase or
          acquisition of assets, or similar business transaction with the
          Company. If a person, including an entity shareholder, owns stock in
          both corporations that enter into a merger, consolidation, purchase or
          acquisition of stock, or similar transaction, such shareholder is
          considered to be acting as a group with other shareholders in a
          corporation only to the extent of the ownership in that corporation
          prior to the transaction giving rise to the change and not with the
          ownership interest in the other corporation. Notwithstanding the
          foregoing, no trust Department or designated fiduciary or other
          trustee of such trust department of the Company or a subsidiary of the
          Company, or other similar fiduciary capacity of the Company with
          direct voting control of the stock shall be treated as a person or
          group within the meaning of hereof. Further, no profit-sharing,
          employee stock ownership, employee stock purchase and savings,
          employee pension, or other employee benefit plan of the Company or any
          of its subsidiaries, and no Trustee of any such plan in its capacity
          as such Trustee, shall be treated as a person or group within the
          meaning hereof.


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