Document:

exv10w20

EXHIBIT 10.20

VISTEON CORPORATION

NON-EMPLOYEE DIRECTOR

STOCK UNIT PLAN

(As amended through June 12, 2008)

			
	Section 1.	 	EFFECTIVE DATE

	 	 	The Board of Directors of Visteon Corporation have adopted this Non-Employee Director Stock
Unit Plan, effective May 12, 2004, for the benefit of the non-employee directors of Visteon
Corporation.

			
	Section 2.	 	DEFINITIONS

	 	 	When used herein the following words and phrases shall have the meanings set forth below
unless the context clearly indicates otherwise:

	(a)	 	“Account” means the recordkeeping account maintained by the Company in the name of the
Participant. An Account is established for record keeping purposes only and not to reflect
the physical segregation of assets on the Participant’s behalf, and may consist of such
subaccounts or balances as the Committee may determine to be necessary or appropriate,
including the following:

	 	1.	 	“Mandatory Deferral Subaccount” means the Visteon Stock Units
that are credited to the Participant’s Account as a result of the Participant’s
Mandatory Deferrals.
	 
	 	2.	 	“Dividend Subaccount” means the Visteon Stock Units that are
credited to the Participant’s Account as a result of deemed dividends on
Visteon Stock Units credited to the Participant’s Account.

	(b)	 	“Administrative Committee” means the non-participating members of the Board.
	 
	(c)	 	“Affiliate” means a person or legal entity that directly or indirectly, through one or more
intermediaries, controls or is controlled by, or is under common control, with the

 

 

	 	 	Company, within the meaning of Code Sections 414(b) and (c); provided that Code Sections
414(b) and (c) shall be applied by substituting “at least fifty percent (50%)” for “at least
eighty percent (80%)” each place it appears therein.
	 
	(d)	 	“Board” means the Board of Directors of the Company.
	 
	(e)	 	“Code” means the Internal Revenue Code of 1986, as interpreted by regulations and rulings
issued pursuant thereto, all as amended and in effect from time to time.
	 
	(f)	 	“Company” means Visteon Corporation, or any successor thereto.
	 
	(g)	 	“Company Stock” means the common stock of the Company, par value $1.00.
	 
	(h)	 	“Exchange” means the New York Stock Exchange.
	 
	(i)	 	“Outside Director” means a member of the Board who is not an officer or a common-law employee
of the Company or any subsidiary thereof.
	 
	(j)	 	“Participant” means each Outside Director who has an Account under the Plan.
	 
	(k)	 	“Plan” means the Visteon Corporation Non-Employee Director Stock Unit Plan, as amended from
time to time.
	 
	(l)	 	“Plan Year” means the period beginning on the effective date of the Plan and ending on
December 31, 2004 and thereafter, the twelve month period beginning on January 1 and ending
December 31 of each year.
	 
	(m)	 	Separation from Service” means the date on which a Participant ceases to be a member of the
Board of Directors of the Company (or the board of directors of any Affiliate), provided that
such cessation constitutes a separation from service for purposes of Code Section 409A.
	 
	(n)	 	“Visteon Stock Units” mean the hypothetical shares of Company Stock that are credited to a
Participant’s Account in accordance with Sections 4 and 5.

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	Section 3.	 	ADMINISTRATION

	(a)	 	General Authority. The Administrative Committee shall have the full power and
discretionary authority to: (1) interpret and administer the Plan and any instrument relating
to or made under the Plan; (2) establish, amend, suspend or waive such rules and regulations
and appoint such agents as it shall deem appropriate for the proper administration of the
Plan; and (3) make any other determination, and take any other action, that the Administrative
Committee deems necessary or desirable for the administration of the Plan. The decisions and
determinations of the Administrative Committee need not be uniform and may be made differently
among Participants, and shall be final, binding and conclusive on all interested parties.
	 
	(b)	 	Recordkeeping. The Administrative Committee shall be responsible for maintaining all
Accounts; provided that the Administrative Committee may in its discretion appoint or remove a
third-party recordkeeper to maintain the Accounts as provided herein.
	 
	(c)	 	Effectiveness of Elections. Any elections or beneficiary designations made under
this Plan shall be effective only upon the delivery of the appropriate form to the Secretary
of the Company and its acceptance by the Administrative Committee.

			
	Section 4.	 	MANDATORY DEFERRALS

	(a)	 	Mandatory Deferrals. On the day after the date of each regular annual meeting of
stockholders of the Company, the Mandatory Deferral Account of each Participant who is then an
Outside Director shall be credited with a number of additional Visteon Stock Units equal to
the result obtained by (i) dividing (A) $70,000 by (B) the average of the high and low prices
at which a share of Company Stock shall have been sold regular way on the Exchange on such
date and (ii) rounding the quotient to four decimal places (each, a “Mandatory Deferral”).
	 
	(b)	 	Vesting. Each Participant shall at all times be 100% vested in his or her Mandatory
Deferral Subaccount.

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	Section 5.	 	DIVIDEND EQUIVALENTS

	(a)	 	Conversion to Visteon Stock Units. Any cash dividends that would have been payable in
any month on the Visteon Stock Units credited to a Participant’s Account had such units been
actual shares of Company Stock shall be converted, for recordkeeping purposes, into whole and
fractional Visteon Stock Units, with fractional units calculated to four decimal places, with
the resulting Visteon Stock Units credited to the Participant’s Dividend Subaccount. The
conversion shall be accomplished by dividing the Participant’s deemed dividends for the month
by the average of the high and low prices at which a share of Common Stock shall have been
sold regular way on the Exchange on the last day of such month on which the Exchange is open
to transact trades.
	 
	(b)	 	Vesting. Each Participant shall at all times be 100% vested in his or her Dividend
Subaccount.

			
	Section 6.	 	DISTRIBUTIONS

	 	(a)	 	Distribution Date. Distribution of a Participant’s vested Account
shall be made or commence to be made on the later of (i) January 15 of the calendar
year following the calendar year in which, or (ii) the first day of the seventh month
following the date on which, occurs the Participant’s Separation from Service.
	 
	 	(b)	 	Participant Distribution Elections. Distribution shall be made in the
form or forms of distribution elected by the Participant. A Participant’s distribution
election with respect to any Plan Year applies to both the Mandatory Deferrals made on
behalf of the Participant during that Plan Year, and to all dividend equivalent credits
made with respect to those Mandatory Deferrals. The Participant may elect to have a
distribution made either in (i) a single sum, or (ii) ten (10) annual installments. A
Participant who fails to make any distribution election shall be deemed to have elected
the single sum payment option.

	 	1.	 	Pre-2009 Plan Year Deferral Balances. The Participant
may make a separate distribution election with respect to each Plan Year;
provided that a Participant’s election with respect to a Plan Year shall
continue in effect

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	 	 	 	with respect to each subsequent Plan Year unless the Participant has
submitted (and the Administrative Committee has received) a modified
distribution election prior to January 1 of the Plan Year; provided that
with respect to Mandatory Deferrals in 2004, a Participant may make an
election regarding distribution within thirty (30) days after initial
stockholder approval of the Plan. On or before December 31, 2008, a
Participant may further revise his or her distribution election with respect
to any Plan Year; provided that a revised distribution election made during
calendar years 2006, 2007 or 2008 with respect to any Plan Year will not be
given effect, and the Participant’s immediately prior valid distribution
election with respect to such Plan Year will continue in effect, if the
revised election would operate to cause amounts that would otherwise be
distributable in the calendar year in which the revised distribution
election is made to be deferred for distribution in a subsequent calendar
year, or to cause amounts that would otherwise be distributable in a
subsequent calendar year to become distributable in the calendar year in
which the revised election is made. A Participant’s distribution elections
as in effect on December 31, 2008 for Plan Year ending on or before December
31, 2008, shall be irrevocable. 
	 
	 	2.	 	Post-2008 Plan Year Deferral Balances. The Participant
may make a separate distribution election with respect to each Plan Year. Such
election shall be effective on the first day of the Plan Year following the
date it is received by the Administrative Committee; provided that to the
extent permitted under Code Section 409A, a Participant may make a distribution
election within 30 days of first becoming a Participant with respect to the
Plan Year in which participation commences. A distribution election, once
becoming effective with respect to a Plan Year, shall be irrevocable with
respect to that Plan Year. An election shall continue in effect with respect
for subsequent Plan Years (and, with respect to any Plan Year, shall become
irrevocable on January 1 of that Plan Year) unless modified by the Participant
in accordance with this Section 6. A

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	 	 	 	Participant may modify an existing election effective on the first day of
the Plan Year following the date on which the revised election is received
by the Administrative Committee. 

	(c)	 	Distribution Procedures.

	 	1.	 	Single Sum Distribution. If the Participant has
elected the single sum distribution option, the Company, in accordance with
directions from the Administrative Committee, will distribute to the
Participant shares of Company Stock equal to the number of Visteon Stock Units
credited to the Participant’s Account (and cash in lieu of any fractional unit)
for which such election is in effect; provided that the Organization and
Compensation Committee of the Board may direct that all or any part of
the Participant’s distribution be satisfied in cash rather than by a
distribution of Company Stock, in which case the cash payment shall be
determined by multiplying the number of Visteon Stock Units in the
Participant’s Account that are the subject of the cash payment by the average
of the high and low prices at which a share of Company Stock shall have been
sold regular way on the Exchange on the 5th trading day preceding
the date on which distribution is made.
	 
	 	2.	 	Installment Distributions. If the Participant has
elected the installment distribution option, the first installment will be paid
on the date specified in Section 6(a). Each subsequent installment will be
paid on January 15 of each succeeding calendar year during the installment
period. The annual installment distribution amount for any year shall be
initially determined on a share basis by dividing the number of Visteon Stock
Units credited to the Participant’s Account as of January 1 of the year for
which the distribution is being made and for which such an election is in
effect by the number of installment payments remaining to be made, and then
rounding the quotient obtained for all but the final installment to the next
lowest whole number. The Company, in accordance with directions from the
Administrative Committee, will distribute to the Participant shares of

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	 	 	 	Company Stock equal to the number of Visteon Stock Units that are being
redeemed as part of the installment (and cash in lieu of any fractional
unit); provided that the Organization and Compensation Committee of the
Board may direct that all or any part of the installment distribution be
satisfied in cash rather than by a distribution of Visteon Stock, in which
case the cash payment shall be determined by multiplying the number of
Visteon Stock Units in the Participant’s Account that are the subject of the
cash payment by the average of the high and low prices at which a share of
Company Stock shall have been sold regular way on the Exchange on the
5th trading day preceding the date on which distribution is made.

	(d)	 	Securities Restrictions. With respect to any shares of Company Stock distributed to
a Participant, the Participant will not sell or otherwise dispose of such Company Stock except
pursuant to an effective registration statement under the Securities Act of 1933, as amended
(the “Act”), and applicable state securities laws, which the Company may but shall not be
required to file, or in a transaction which, in the opinion of counsel for the Company, is
exempt from such registration, and a legend may be placed on the certificates for the Company
Stock to such effect. In addition, in the event of any underwritten public offering of the
Company’s securities pursuant to an effective registration statement filed under the Act and
upon the request of the Company or the underwriters managing any underwritten offering of the
Company’s securities, the Participant shall not directly or indirectly sell, make any short
sale of, loan, hypothecate, pledge, offer, grant or sell any option or other contract for the
purchase of, or otherwise dispose of or transfer, or agree to engage in any of the foregoing
transactions with respect to, any shares of Company Stock (other than those included in the
registration) acquired under this Plan without the prior written consent of the Company or
such underwriters, as the case may be, for such period of time (not to exceed 180 days) from
the effective date of such registration as may be requested by the Company or such managing
underwriters.
	 
	(e)	 	Timing of Distributions. Any distribution that is to be made on a specified date may
be made within 31 days following such date; provided that the Participant is not permitted,
directly or indirectly, to specify the taxable year of the payment.

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	Section 7.	 	BENEFICIARY

	(a)	 	Death Benefits. If a Participant dies before his or her entire Account has been
distributed, then the remainder of the Participant’s Account shall be distributed in a lump
sum to the Participant’s beneficiary on the later to occur of (i) January 15 of the calendar
year following the calendar year in which, or (ii) the first day of the seventh month
following the date on which, occurs the Participant’s death. Any distribution that is to be
made on a specified date may be made within 31 days following such date; provided that the
beneficiary is not permitted, directly or indirectly, to specify the taxable year of the
payment.
	 
	(b)	 	Designation of Beneficiary. Each Participant may designate one or more beneficiaries
in such form and manner specified by the Administrative Committee, which beneficiary shall be
entitled to receive the balance of the Participant’s Account as provided under subsection (a)
above in the event of the Participant’s death. The Participant may from time to time revoke or
change the beneficiary without the consent of any prior beneficiary by filing a new
designation with the Secretary of the Company. The last such designation received by the
Secretary of the Company shall be controlling. If no beneficiary designation is in effect at
the time the Participant dies, or if no designated beneficiary survives the Participant, the
Participant’s beneficiary shall be the Participant’s estate.

			
	Section 8.	 	SOURCE OF BENEFITS

	 	 	Benefits accumulated under the Plan shall constitute an unfunded, unsecured promise by the
Company to provide such payments in the future, as and to the extent such amounts become
payable. Benefits attributable to service as an Outside Director shall be paid from the
general assets of the Company, and no person shall, by virtue of this Plan, have any
interest in such assets, other than as an unsecured creditor of the Company.

			
	Section 9.	 	NON-ALIENATION

	 	 	Except as otherwise expressly provided by this Plan, neither the Participant nor his or her
beneficiary or beneficiaries, including, without limitation, the Participant’s executors and
administrators, heirs, legatees, distributees, and any other person or persons claiming any

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	 	 	benefits through the Participant under this Plan shall have any right to assign, transfer,
pledge, hypothecate, sell, transfer, alienate and encumber or otherwise convey the right to
receive any benefits hereunder, which benefits and the rights thereto are expressly declared
to be nontransferable. The right to receive benefits under this Plan also shall not be
subject to execution, attachment, garnishment, or similar legal, equitable or other process
for the benefit of the Participant’s or beneficiary’s creditors. Any attempted assignment,
transfer, pledge hypothecation or other disposition of the Participant’s or beneficiary’s
rights to receive benefits under this Plan or the levy of any attachment, garnishment or
similar process thereupon, shall be null and void and without effect.

			
	Section 10.	 	CHANGE IN CONTROL

	 	 	In the event of a Change in Control Event (as defined in Code Section 409A) with respect
to the Company, the value of the Participant’s Account, determined as of the date of the
Change in Control Event, shall be immediately paid to the Participant in a single sum
cash payment, notwithstanding any prior distribution election made by the Participant.

			
	Section 11.	 	TERM, TERMINATION AND AMENDMENT

	(a)	 	Unless terminated earlier pursuant to subsection (b) below, this Plan shall terminate on May
12, 2014.
	 
	(b)	 	The Board reserves the right to amend or terminate this Plan at any time; provided that any
termination of the Plan shall be implemented in accordance with the requirements of Code
Section 409A, and the authority of the Administrative Committee to administer the Plan shall
extend beyond the date of the Plan’s termination; and provided further that no amendment or
termination of the Plan shall adversely affect the rights of any Participant or beneficiary to
benefits then accrued without the written consent of the affected Participant or beneficiary.

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	Section 12.	 	MISCELLANEOUS

	(a)	 	Governing Law. This Plan shall be governed by and construed in accordance with the
internal laws of the State of Delaware, without reference to the conflicts of law principles
thereof.
	 
	(b)	 	Severability. If any provision of the Plan is or becomes or is deemed to be invalid,
illegal or unenforceable in any jurisdiction or as to any person, or under any law deemed
applicable by the Administrative Committee, such provision shall be construed or deemed
amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Administrative Committee, materially altering the intent
of the Plan, such provision shall be stricken as to such jurisdiction or person, and the
remainder of the Plan shall remain in full force and effect.
	 
	(c)	 	Successors and Assigns. The Plan shall be binding upon, and inure to the benefit of,
the Company and its successors and assigns, and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of the Company’s
assets and business.
	 
	(d)	 	Transactions Affecting Visteon Common Stock. In the event of any merger, share
exchange, reorganization, consolidation, recapitalization, stock dividend, stock split or
other change in corporate structure of the Company affecting Company Stock, the Administrative
Committee shall make appropriate equitable adjustments with respect to the Visteon Stock Units
(if any) credited to the Account of each Participant, including without limitation, adjusting
the number of such Units or the date as of which such Units are valued and/or distributed, as
the Administrative Committee determines is necessary or desirable to prevent the dilution or
enlargement of the benefits intended to be provided under the Plan.
	 
	(e)	 	Permitted Delay in Payment. If a distribution required under the terms of this Plan
would jeopardize the ability of the Company or of an Affiliate to continue as a going concern,
the Company or the Affiliate shall not be required to make such distribution. Rather, the
distribution shall be delayed until the first date that making the distribution does not

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	 	 	jeopardize the ability of the Company or of an Affiliate to continue as a going concern.
Further, if any distribution pursuant to the Plan will violate the terms of Federal
securities law or any other applicable law, then the distribution shall be delayed until the
earliest date on which making the distribution will not violate such law.

11exv10w1

EXHIBIT 10.1

Severance Compensation Agreement

     This Severance Compensation Agreement (the “Agreement”), has been made on July 24,
2008 by Fentura Financial, Inc., a Michigan corporation (the “Company”), The State
Bank, (the “Bank”) and Donald L. Grill, an individual (the “Executive”).

Background Statement:

     The Executive is a principal officer of the Bank and the Company and his continued services
are important to the Bank, its depositors and customers, and the Company’s shareholders. The Bank
and the Company believe it is in their best interests that the Executive continue to render
services to the Bank and the Company if a Change in Control is threatened or occurs, free from the
distractions and vexations which might result if his personal economic security is made uncertain
as a result of an impending Change in Control.

     1. Definitions. The following words and phrases have the following meanings:

	 	a)	 	“Cause” means (i) the willful and continuing failure by the Executive
to substantially perform his duties with the Bank or the Company (other than
any such failure resulting from the Executive’s death or Disability) and which
is not remedied in a reasonable period of time after receipt by Executive of
written notice from the Bank specifying the duties the Executive has failed to
perform, or (ii) the willful and continued engaging by Executive in gross
misconduct that is materially injurious to the Bank or the Company and which is
not ceased within a reasonable period of time after receipt by Executive of
written notice from the Bank specifying the misconduct and the injury, or (iii)
an adjudication of the Executive’s guilt of any crime involving a serious and
substantial breach of the Executive’s fiduciary duties to the Bank. No act or
failure to act on the Executive’s part shall be considered “willful” unless
done, or omitted to be done, by him in bad faith and without reasonable belief
that his action or omission was in the best interest of the Bank or the
Company.
	 
	 	b)	 	“Change in Control” means (i) the acquisition, directly, indirectly
and/or beneficially, by any person or group, of more than fifty percent (50%)
of the
voting securities of the Company or the Bank, (ii) the occurrence of any
event at any time during any two (2) year period which results in a majority

 

 

	 	 	 	of the Board of Directors of the Company or the Bank being comprised of
individuals who were not members of such Board at the commencement of that
two (2) year period (the “Incumbent Board”); provided, however, that any
individual becoming a director subsequent to the date hereof whose election,
or nomination for election by the Company’s or the Bank’s shareholders, was
approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding for this purpose any such
individual whose initial assumption of the office occurs as a result of an
actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of proxies
or consents by or on behalf of a person other than the Incumbent Board,
(iii) a sale of all or substantially all of the assets of the Company or the
Bank to another entity, or (iv) a merger or reorganization of the Company or
the Bank with another entity.

	 	c)	 	“Compensation” means with respect to the period under consideration,
the aggregate of all amounts paid by the Company and the Bank to and includable
in the Executive’s earnings as base salary, bonuses, commissions, fees and any
other compensation, but excluding contributions made to any welfare and pension
benefit plans by the Bank and/or Company at its or their sole expense.
	 
	 	d)	 	“Disability” means any physical or mental impairment which meets the
definition of disability found in the long-term or short-term disability policy
insuring the Executive at the time disability is alleged or if no such policy
is in effect at that time, any physical or mental impairment that, on the basis
of qualified medical opinion of three (3) medical doctors, has rendered
Executive wholly and permanently unable to engage in the regular and continuous
occupation or employment for remuneration or profit of a nature similar to his
employment with the Bank for a period of six (6) consecutive months or more.
	 
	 	e)	 	“Good Reason” means any of the following, as determined by the
Executive in his discretion: (i) a material diminution of the Executive’s
duties, responsibilities, or authority with the Bank or the Company immediately
prior to a Change in Control, or a change adverse to Executive in Executive’s
reporting responsibilities, titles, terms of employment (including bonus,
compensation, fringe benefits and vacation entitlement) or (ii) the Bank or the
Company requiring Executive to be based anywhere other than within fifty (50)
miles of his present office location, or (iii) a material breach of this
Agreement including the failure by the Company to obtain the assumption of this
Agreement as contemplated in Section 6 hereof. Upon the occurrence of any
event referenced above, Executive shall, within ninety (90) of any occurrence,
provide the Bank and the Company notice of the existence of the condition.
Upon receiving notice, the Bank and the Company shall

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	 	 	 	have no more than thirty (30) days to remedy the condition. Executive shall
have two years from the date of the initial existence of a violation of one
of the above events to terminate his employment under this section.

     2. Income Protection Benefits. If the Executive is an employee of the Bank or the Company
when a Change in Control occurs, and the Executive’s employment with the Bank, the Company and all
affiliates of the Company is thereafter terminated without Cause, or by the Executive for Good
Reason, then:

	 	a)	 	The Company and the Bank shall pay to the Executive, in a lump sum in
cash within 30 days after the date of termination of employment the aggregate
of the following amounts:

	 	i)	 	that portion of the Executive’s annual base salary and
director’s fees through the date of termination not theretofore paid,
and
	 
	 	ii)	 	the product of (x) the sum of all commissions and
bonuses of any kind paid or payable to Executive in the calendar year
immediately preceding the year in which termination of employment
occurs multiplied by (y) a fraction, the numerator of which is the
number of days in the current calendar year through the date of
termination, and the denominator of which is 365, and
	 
	 	iii)	 	a separate lump-sum amount equal to 21/2 times the sum of
the highest amount of the Executive’s annual Compensation in the five
calendar years immediately preceding Executive’s termination.
	 
	 	iv)	 	any compensation previously deferred by the Executive
(together with any accrued interest o earnings thereon), and
	 
	 	v)	 	any accrued vacation pay.

	 	b)	 	The Executive shall have the right within 90 days following termination
of employment to exercise any stock options awarded him prior to the
termination of his employment.
	 
	 	c)	 	The Bank and/or the Company shall provide to the Executive, at its
expense, hospital and medical insurance coverage of the same or equivalent
scope as he was covered by immediately prior to termination of his employment
for a period of 5 years after Executive’s termination of employment. If,
however, the Bank or the Company determines that such continued coverage would
be taxable as includible in income, the Bank or the Company, within 30 days
after the date of termination of employment, shall provide to Executive a

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	 	 	 	lump sum payment equal to the value 5 years of continued hospital and medical
insurance coverage of the same or equivalent scope as Executive was covered
by immediately prior to termination of his employment.

     3. Maximum Benefits upon Change in Control. If it is determined, in the opinion of the
Company’s independent accountants, in consultation, if necessary, with the Company’s legal counsel,
that any amount paid under this Agreement in connection with a Termination Upon Change in Control,
either separately or in conjunction with any other payments, benefits and entitlements received by
the Executive in respect of a Change in Control hereunder or under any other plan or agreement
under which the Executive participates or to which he is a party, would constitute an “excess
Parachute Payment” within the meaning of Section 280G of the Internal Revenue Code of 1986, and
would thereby be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”),
then in such event, the Company shall pay to the Executive a “grossing-up” amount equal to the
amount of such Excise Tax, plus all federal and state income or other taxes with respect to the
payment of the amount of such Excise Tax, including all such taxes with respect to any such
grossing—up amount. If, at a later date, the Internal Revenue Service assesses a deficiency
against the Executive for the Excise Tax which is greater than that which was determined at the
time such amounts were paid, then the Company shall pay to the Executive the amount of such
unreimbursed Excise Tax, plus any interest, penalties and reasonable professional fees or expenses
incurred by the Executive as a result of such assessment, including all such taxes with respect to
any such additional amount. The highest marginal tax rate applicable to individuals at the time of
the payment of such amounts will be used for purposes of determining the federal and state income
and other taxes with respect thereto. The Company shall withhold from any amounts paid under this
Agreement the amount of any Excise Tax or other federal, state or local taxes then required to be
withheld. Computations of the amount of any grossing-up supplemental compensation paid under this Section

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shall be conclusively made by the Company’s
independent accountants, or other independent accountants retained by the Company, in consultation,
if necessary with the Company’s independent legal counsel. If, after the Executive receives any
gross-up payments or other amount pursuant to this Section, the Executive receives any refund with
respect to the Excise Tax, the Executive shall promptly pay the Company the amount of such refund
within ten (10) days of receipt by the Executive, on a grossed-up basis. If the Company deems it
necessary or advisable to contest or appeal any assessment, or determination made by the Internal
Revenue Service relating to the imposition of an Excise Tax as described herein (an “Excise Tax
Contest/Appeal”), the Executive covenants and agrees to reasonably cooperate with the Company in
connection with the Excise Tax Contest/Appeal; provided, however, that the Company shall be
responsible for all professional costs and expenses incurred by the Executive in connection with
such Excise Tax Contest/Appeal.

     4. Term. Unless earlier terminated by mutual agreement of the Company and the Executive, this
Agreement shall terminate upon the earliest of (a) the termination of the Executive’s employment
with the Bank and the Company for any reason prior to a Change in Control; or (b) five (5) years
from the date of a Change in Control. Obligations under Section 2 of this Agreement created prior
to termination shall survive termination.

     5. Termination Prior To Change in Control. Notwithstanding anything in this agreement to the
contrary, if a Change in Control occurs and (i) if the Executive’s employment with the Company or
the Bank is terminated prior to the date on which Change in Control occurs, and if the termination
of employment (a) was at the request or suggestion of a 3rd party who has taken steps reasonably
calculated to effect the Change in Control or (b) otherwise arose in connection with or in
anticipation of the Change in Control, or (ii) Executive has terminated his employment with Company
and/or Bank for Good Reason prior to Change in Control, then Executive shall be entitled

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to the Income Protection Benefits and all other rights and privileges provided by this Agreement.

     6. Successors, Binding Agreements.

	 	a)	 	Any purchaser, successor or assign (whether direct or indirect), to or of all,
substantially all, or any material part of the business, properties and assets of the
Bank and/or the Company shall be bound by the terms of this Agreement, and the Bank and
the Company shall require any such purchaser, successor or assign, by agreement in form
and substance satisfactory to Executive, expressly, absolutely and unconditionally to
assume and agree to perform this Agreement in the same manner and to the same extent
that the Bank and the Company would be required to perform if no such succession or
assignment had taken place.
	 
	 	b)	 	The Bank and the Company each hereby guarantee the timely payment and
performance, when due, of the other’s obligations under this Agreement.
	 
	 	c)	 	This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal and legal representatives, executives, administrators, successors,
heirs, distributees, devisees and legatees.

     7. Exemption from Section 409A. The Agreement and transactions under this Agreement are
intended to be structured in accordance with applicable laws, rules and regulations including, but
not limited to, the short-term deferral exemption under Section 409A of the Internal Revenue Code
and any applicable regulations thereunder.

     8. Notices. Notices under this Agreement shall be in writing and shall be deemed given when
hand delivered or three (3) days after being mailed by United States registered or certified mail,
return receipt requested, postage prepaid, as follows:

	 	 	 
	If to the Company

or the Bank:

	 	Fentura Financial, Inc.

175 N. Leroy St.

-6-

 

	 	 	 
	 

	 	PO Box 725

Fenton, MI 48430-0725
	 
	 	 
	If to the Executive:

	 	Mr. Donald L. Grill

14655 S. Fowlerville Rd.

Perry, MI 48872-9594

     or to such other address as either party may designate.

     9. At Will Employment Preserved. This Agreement is intended only to provide an economic
benefit for Executive if his employment with the Bank or the Company is terminated under the
circumstances described herein. Even though this economic benefit may be payable, Executive’s
employment with the Bank and the Company shall continue to be “at will,” and the Bank, the Company
or the Executive may terminate Executive’s employment with the Bank or the Company at any time,
with or without cause. Further, the existence of this Agreement and the economic benefits herein
provided shall not contradict, override, supersede or in any way detract from or affect the “at
will” employment status of any other employee of the Bank or the Company. The employment terms set
forth in the Bank’s employee handbook or employee manual, as they may be in effect from time to
time, shall control.

     10. Miscellaneous.

	 	a)	 	Modification; Waiver. This Agreement may be modified, waived or discharged
only in, and limited to the extent specifically set forth in, a written document signed
by the Executive and the Company.
	 
	 	b)	 	Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of
this Agreement, which shall remain in full force and effect.
	 
	 	c)	 	Governing Law. This Agreement shall be governed in all respects according to
the laws of the State of Michigan.

-7-

 

	 	d)	 	Entire Agreement. This Agreement contains the entire understanding of the
parties concerning the Executive’s severance compensation opportunities. This
Agreement supersedes and controls over the Executive’s March 20, 1997 and March 16,
2007 Severance Compensation Agreements with the Company and the Bank. This Agreement
does not supersede Executive’s Fentura Financial, Inc. Confidentiality and Shareholder
Protection Agreement dated July 9, 2003.

	 	 	 	 	 
	 	COMPANY:

Fentura Financial, Inc.,

a Michigan corporation

 	 
	 	By:  	/s/ Forrest A. Shook
 	 
	 	 	Forrest A. Shook, Chairman 	 
	 	 	 	 
	 
	 	BANK:

The State Bank

 	 
	 	By:  	/s/ Brian P. Petty
 	 
	 	 	Brian P. Petty, Chairman 	 
	 	 	 	 
	 
	 	EXECUTIVE:

 	 
	 	
/s/ Donald L. Grill
 	 
	 	Donald L. Grill 	 
	 	 	 
	 

-8-

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