Document:

Exhibit 10.6

 

 

SECOND AMENDMENT

TO THE

MUTUALBANK

EXECUTIVE DEFERRED
COMPENSATION MASTER AGREEMENT

DATED OCTOBER 1,
1993,

AS AMENDED OCTOBER
20, 2010

 

THIS SECOND AMENDMENT
is adopted this 19th day of December, 2016, effective as of January 1, 2005, by and between MUTUALBANK, an Indiana commercial
bank located in Muncie, Indiana and formerly known as Mutual Federal Savings Bank (the “Bank”), and certain key employees
(the “Executive”).

 

The Bank and the Executives
executed the Executive Deferred Compensation Master Agreement effective as of October 1, 1993, which was subsequently amended
on October 20, 2010 (the “Agreement”).

 

The undersigned hereby amend the Agreement
for the purpose of bringing the Agreement into compliance with Section 409A of the Internal Revenue Code (“Section 409A”).
The amendments adopted herein shall be referred to as the “Second Amendment”.

 

The Section 409A Amendments shall apply
only to those benefits under the Agreement that are subject to Section 409A (i.e., amounts that are deferred in taxable years
after December 31, 2004, or amounts that were deferred in taxable years prior to January 1, 2005, with respect to which the Executive
did not, as of December 31, 2004, have a legally binding right to be paid or the right to the amount was not earned and vested,
all as determined in accordance with the regulations under Section 409A). With respect to benefits under this Agreement that are
not subject to Section 409A (“Non-Section 409A Benefits”), the Agreement shall be applied as if the Second Amendment
was never adopted. The intent of the preceding sentence is to ensure that Non-Section 409A Benefits are not subject to Section
409A (by virtue of a material modification or otherwise), and the Agreement shall be administered and interpreted accordingly.

Therefore, the following changes shall be made:

 

The following Subsection 1.7a shall be
added to the Agreement immediately following Subsection 1.7:

 

		1.7a	“Company” means MutualFirst Financial, Inc.,
                                         the parent holding company of the Bank, and any successor thereto.

 

Subsection 1.20b of the Agreement is
hereby amended and restated to read in its entirety as follows:

 

		1.20b	“Specified Employee” means an individual who
                                         at the time of Termination of Service is a key employee of the Company or the Bank (or
                                         any other affiliated entities that are deemed to constitute a “service recipient”
                                         as defined in Treasury Regulation §1.409A-1(g)), if any stock of the Company or
                                         the Bank (or any other affiliated entities that are deemed to constitute a “service
                                         recipient”) is publicly traded on an established securities market or otherwise.
                                         For purposes of this Agreement, an individual is a key employee if the individual meets
                                         the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance
                                         with the regulations thereunder and disregarding Section 416(i)(5)) at any time during
                                         the 12-month period ending on December 31 (the “identification period”).
                                         If an Executive is a key employee during an identification period, the Executive is treated
                                         as a key employee for purposes of this Agreement during the twelve (12) month period
                                         that begins on the first day of April following the close of the identification period.

 

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Subsection 1.22a of the Agreement is
hereby amended and restated to read in its entirety as follows:

 

		1.22a	“Termination of Employment”
                                         means termination of the Executive’s employment with the Bank (and any other affiliated
                                         entities that are deemed to constitute a “service recipient” as defined in
                                         Treasury Regulation §1.409A-1(h)(3), including the Company) for any reason other
                                         than death or Disability. Whether a Termination of Employment has occurred is determined
                                         based on whether the facts and circumstances indicate that the Bank and the Executive
                                         reasonably anticipated that no further services would be performed after a certain date
                                         or that the level of bona fide services the Executive would perform after such date (whether
                                         as an employee or as an independent contractor) would permanently decrease to no more
                                         than twenty percent (20%) of the average level of bona fide services performed (whether
                                         as an employee or an independent contractor) over the immediately preceding thirty-six
                                         (36) month period (or the full period of services to the Bank if the Executive has been
                                         providing services to the Bank less than thirty-six (36) months).

 

Subsection 5.3 of
the Agreement is hereby amended and restated to read in its entirety as follows:

 

		5.3	Termination For Cause. In the
                                         event the Executive is terminated for Cause at any time prior to reaching his Benefit
                                         Age, he shall be entitled to receive the balance of his Elective Contribution Account
                                         measured as of the date of the Termination of Employment for Cause. Such amount shall
                                         be paid in a lump sum within thirty (30) days of the Executive’s Termination of
                                         Employment for Cause, subject to Section 5.4 of this Agreement. He shall not be entitled
                                         to any portion of his Matching Contribution Account. All other benefits for the Executive
                                         or his Beneficiary under this Agreement shall be forfeited and the Agreement shall become
                                         null and void.

 

Subsection 12.1(1) of the Agreement is
hereby amended and restated to read in its entirety as follows:

 

		(1)	The Bank’s Board of Directors
                                         may terminate the Executive’s employment at any time, but any termination by the
                                         Bank’s Board of Directors other than termination for Cause shall not prejudice
                                         the Executive’s vested right to compensation or other benefits under the Agreement.
                                         As provided in Section 5.3, the Executive shall be paid the balance of his Elective Contribution
                                         Account in a lump sum within thirty (30) days of his Termination of Employment for Cause,
                                         subject to Section 5.4 of this Agreement. He shall have no right to receive additional
                                         compensation or other benefits for any period after termination for Cause.

 

Section 13.3 of the Agreement is hereby
amended and restated to read in its entirety as follows:

 

		13.3	Plan Terminations Under Section
                                         409A. Notwithstanding anything to the contrary in Subsection 13.2, the Bank may completely
                                         terminate and liquidate this Agreement and cause all benefits payable under the Agreement
                                         to be paid in a lump sum under the following circumstances and conditions, in each case
                                         provided that all of the applicable requirements of Treasury Regulation §1.409A-3(j)(4)(ix)
                                         are satisfied:

 

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		(a)	The Bank or its successor may terminate
                                         and liquidate this Agreement by taking irrevocable action to terminate and liquidate
                                         this Agreement within the thirty (30) days preceding or the twelve (12) months following
                                         a Change in Control, provided that all arrangements sponsored by the Bank or its successor
                                         (or any other affiliated entities that are deemed to constitute a “service recipient”
                                         as defined in Treasury Regulation §1.409A-1(g)) immediately after the Change in
                                         Control which are treated as deferred under a single plan under Treasury Regulation §1.409A-1(c)(2)
                                         are terminated and liquidated with respect to each participant who experienced the Change
                                         in Control so that each Executive and any participants in any such similar arrangements
                                         are required to receive all amounts of compensation payable under the terminated arrangements
                                         within twelve (12) months of the date of the irrevocable action to terminate the arrangements;

 

		(b)	The Bank may terminate and liquidate
                                         this Agreement within twelve (12) months of the Bank’s dissolution or with the
                                         approval of a bankruptcy court, provided that all benefits payable under the Agreement
                                         are included in each Executive's gross income in the latest of the following years (or,
                                         if earlier, the taxable year in which the amount is actually or constructively received):
                                         (i) the calendar year in which the Agreement terminates; (ii) the calendar year in which
                                         the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first
                                         calendar year in which the distribution is administratively practicable; or

 

		(c)	The Bank may terminate and liquidate
                                         this Agreement provided that: (i) the termination does not occur proximate to a downturn
                                         in the financial health of the Bank; (ii) all arrangements sponsored by the Bank that
                                         would be aggregated with any terminated arrangements under Treasury Regulation §1.409A-1(c)
                                         if the same service provider had deferrals of compensation under such arrangements are
                                         also terminated and liquidated; (iii) no payments, other than payments that would be
                                         payable under the terms of this Agreement if the termination had not occurred, are made
                                         within twelve (12) months of the date the Bank takes all necessary action to irrevocably
                                         terminate and liquidate this Agreement; (iv) all payments are made within twenty-four
                                         (24) months following the date the Bank takes all necessary action to irrevocably terminate
                                         and liquidate this Agreement; and (v) the Bank does adopt a new arrangement that would
                                         be aggregated with any terminated arrangement under Treasury Regulation §1.409A-1(c)
                                         if the same service provider participated in both arrangements, at any time within three
                                         (3) years following the date the Bank takes the irrevocable action to terminate and liquidate
                                         this Agreement, provided that all references in this clause (c) to the Bank shall include
                                         any affiliated entities that are deemed to constitute a “service recipient”
                                         as defined in Treasury Regulation §1.409A-1(g).

 

Subsection 14.4
of the Agreement is hereby amended and restated to read in its entirety as follows:

 

		14.4	Compliance with Code Section 409A.
                                         With respect to Section 409A Benefits only, this Agreement shall be interpreted and administered
                                         consistent with Code Section 409A. With respect to amounts payable under this Agreement
                                         that are not Section 409A Benefits (“Non-Section 409A Benefits”), Code Section
                                         409A shall not apply. Accordingly, with respect to Non-Section 409A Benefits, this Agreement
                                         shall be applied as if the changes made by the First Amendment and the Second Amendment
                                         hereto (and any other provision adopted specifically to comply with Code Section 409A),
                                         and any other provisions that would result in a material modification of the Non-Section
                                         409A Benefits were never adopted.

 

(Remainder of this
page intentionally left blank)

 

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IN WITNESS OF THE
ABOVE, the Bank and Executives hereby consent to this Second Amendment.

 

	EXECUTIVES:	 	MUTUALBANK
	 	 	 
	 	 	By	 
	Patrick C. Botts	 	 	 
	 	 	Title	                     
	 	 	 
	 	 	 
	Steven Campbell	 	 
	 	 	 
	 	 	 
	David W. Heeter	 	 
	 	 	 
	 	 	 
	Stephen C. Selby	 	 

 

    	 	 	4Exhibit 10.9

 

 

Director Fee Arrangements
in 2016

 

Each director of MutualFirst Financial, Inc. (the “Company”)
also is a director of MutualBank. In 2016, each non-employee director received an annual fee of $31,500 for serving on MutualBank’s
Board of Directors as well as a Board meeting fee of $400 per Audit Committee meeting attended and $200 for all other committee
meetings attended. In addition to this annual fee, Wilbur R. Davis received a $10,000 annual fee for serving as Chairman of the
Board of Directors, Linn Crull received a $5,000 annual fee for serving as Chairman of the Audit Committee, Jerry McVicker received
a $3,000 annual fee for serving as Chairman of the Compensation Committee and Jon Kintner and William Hughes each received half
of the annual $3,000 fee for serving as Chairman of the Wealth Management Committee for a six month period. Directors are not
compensated for their service on the Company’s Board of Directors.

 

MutualBank maintains deferred compensation
arrangements with some directors that previously allowed them to defer all or a portion of their Board fees in order to receive
income when they are no longer active directors. Previously deferred amounts earn interest at the rate of 10 percent per year.

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