Document:

hfb_8k0724ex109.htm

    

      Exhibit
        10.9

       

      

       

      AMENDED
        AND RESTATED EMPLOYMENT AGREEMENT

       

      This
        Amended and Restated Agreement, is made and dated as of July 25, 2007, by
        and
        among Home Federal Savings Bank, a state chartered commercial bank (“Employer”),
        Home Federal Bancorp, an Indiana corporation, which owns all of the capital
        stock of the Employer (the “Holding Company”), and Charles R. Farber, a resident
        of Bartholomew County, Indiana (“Employee”), but effective as of January 1,
        2005.

       

      This
        Agreement amends and restates the prior Employment Agreement among the Employer,
        the Holding Company and the Employee dated March 18, 2002 (the “Prior
        Agreement”).  It has been amended and restated for compliance with the
        final regulations under Section 409A of the Internal Revenue Code of 1986,
        as
        amended.

       

      WITNESSETH

      

      WHEREAS,
        Employee is employed by Employer as an Executive Vice President and has made
        valuable contributions to the profitability and financial strength of
        Employer;

       

      WHEREAS,
        Employer desires to encourage Employee to continue to make valuable
        contributions to Employer’s business operations and not to seek or accept
        employment elsewhere;

       

      WHEREAS,
        Employee desires to be assured of a secure minimum compensation from Employer
        for his services over a defined term;

       

      WHEREAS,
        Employer desires to assure the continued services of Employee on behalf of
        Employer on an objective and impartial basis and without distraction or conflict
        of interest in the event of an attempt by any person to obtain control of
        Employer or of the Holding Company.

       

      WHEREAS,
        Employer recognizes that when faced with a proposal for a change of control
        of
        Employer, Employee will have a significant role in helping the Board of
        Directors assess the options and advising the Board of Directors on what
        is in
        the best interests of Employer and its shareholders, and it is necessary
        for
        Employee to be able to provide this advice and counsel without being influenced
        by the uncertainties of his own situation;

       

      WHEREAS,
        Employer desires to provide fair and reasonable benefits to Employee on the
        terms and subject to the conditions set forth in this Agreement;

       

      WHEREAS,
        Employer desires reasonable protection of its confidential business and customer
        information which it has developed over the years at substantial expense
        and
        assurance that Employee will not compete with Employer for a reasonable period
        of time after termination of his employment with Employer, except as otherwise
        provided herein.

       

      NOW,
        THEREFORE, in consideration of these premises, the mutual covenants and
        undertakings herein contained and the continued employment of Employee by
        Employer as one of its Executive Vice Presidents, Employer and Employee,
        each
        intending to be legally bound, covenant and agree as follows:

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      1.           Upon
        the terms and subject to the conditions set forth in this Agreement, Employer
        employs Employee as an Executive Vice President of Employer, and Employee
        accepts such employment.

       

      2.           Employee
        agrees to serve as an Executive Vice President of Employer and to perform
        such
        duties in that office as may reasonably be assigned to him by Employer’s Board
        of Directors; provided, however that such duties shall be performed in or
        from
        the offices of Employer currently located at Columbus, Indiana and Indianapolis,
        Indiana.  Employee shall not be required to be absent from the
        location of the offices of Employer at which he works on travel status or
        otherwise more than 45 days in any calendar year.  Although while
        employed by Employer, Employee shall devote substantially all his business
        time
        and efforts to Employer’s business and shall not engage in any other related
        business, Employee may use his discretion in fixing his hours and schedule
        of
        work consistent with the proper discharge of his duties.

       

      3.           The
        term of this Agreement shall begin on March 18, 2002 (the “Effective Date”) and
        shall end on the date which is three years following such date; provided,
        however, that such term shall be extended for an additional year on each
        anniversary of the Effective Date if Employer’s Board of Directors determines by
        resolution to extend this Agreement prior to such anniversary of the Effective
        Date, unless either party hereto gives written notice to the other party
        not to
        so extend prior to such anniversary, in which case no further automatic
        extension shall occur and the term of this Agreement shall end two years
        subsequent to the anniversary as of which the notice not to extend for an
        additional year is given (such term including any extension thereof shall
        herein
        be referred to as the “Term”).  Notwithstanding the foregoing, this
        Agreement shall automatically terminate (and the Term of this Agreement shall
        thereupon end) without notice when Employee attains 65 years of
        age.

       

      4.           Employee
        shall receive an annual salary of $180,000 effective June 1, 2006 (“Base
        Compensation”), payable at regular intervals in accordance with Employer’s
        normal payroll practices now or hereafter in effect.  Employer may
        consider and declare from time to time increases in the salary it pays Employee
        and thereby increases in his Base Compensation.  Prior to a Change of
        Control, Employer may also declare decreases in the salary it pays Employee
        if
        the operating results of Employer are significantly less favorable than those
        for the fiscal year ending June 30, 2001, and Employer makes similar decreases
        in the salary it pays to other executive officers of Employer. After a Change
        in
        Control, Employer shall consider and declare salary increases based upon
        the
        following standards:

       

      Inflation;

      

      Adjustments
        to the salaries of other senior management personnel; and

      

      Past
        performance of Employee and the contribution which Employee makes to the
        business and profits of Employer during the Term.

      

      Any
        and
        all increases or decreases in Employee’s salary pursuant to this section shall
        cause the level of Base Compensation to be increased or decreased by the
        amount
        of each such increase or decrease for purposes of this Agreement.  The
        increased or decreased level of Base Compensation as provided in this section
        shall become the level of Base Compensation for the

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      remainder
        of the Term of this Agreement until there is a further increase or decrease
        in
        Base Compensation as provided herein.

       

      5.           So
        long as Employee is employed by Employer pursuant to this Agreement, he shall
        be
        included as a participant in all present and future employee benefit,
        retirement, and compensation plans generally available to employees of Employer,
        consistent with his Base Compensation and his position as an Executive Vice
        President of Employer, including, without limitation, Employer’s Pension Plan,
        401(k) Plan, Stock Option Plan, and hospitalization, major medical, disability
        and group life insurance plans, each of which Employer agrees to continue
        in
        effect on terms no less favorable than those currently in effect as of the
        date
        hereof (as permitted by law) during the Term of this Agreement unless prior
        to a
        Change of Control the operating results of Employer are significantly less
        favorable than those for the fiscal year ended June 30, 2001, and unless
        (either
        before or after a Change of Control) changes in the accounting or tax treatment
        of such plans would adversely affect Employer’s operating results or financial
        condition in a material way, and the Board of Directors of Employer concludes
        that modifications to such plans need to be made to avoid such adverse
        effects.

       

      6.           So
        long as Employee is employed by Employer pursuant to this Agreement, Employee
        shall receive reimbursement from Employer for all reasonable business expenses
        incurred in the course of his employment by Employer, upon submission to
        Employer of written vouchers and statements for reimbursement. So long as
        Employee is employed by Employer pursuant to the terms of this Agreement,
        Employer shall continue in effect reasonable vacation policies applicable
        to
        Employee.

       

      7.           Subject
        to the respective continuing obligations of the parties, including but not
        limited to those set forth in subsections 9(A) and 9(B) hereof, Employee’s
        employment by Employer may be terminated prior to the expiration of the Term
        of
        this Agreement as follows:

       

      
        	
                 

              	
                (A)

              	
                Employer,
                  by action of its Board of Directors and upon written notice to
                  Employee,
                  may terminate Employee’s employment with Employer immediately for
                  cause.  For purposes of this subsection 7(A), “cause” shall be
                  defined as (i) personal dishonesty, (ii) incompetence, (iii) willful
                  misconduct, (iv) breach of fiduciary duty involving personal profit,
                  (v)
                  intentional failure to perform stated duties, (vi) willful violation
                  of
                  any law, rule, or regulation (other than traffic violations or
                  similar
                  offenses) or final cease-and-desist order, or (vii) any material
                  breach of
                  any term, condition or covenant of this
                  Agreement.

              

      

       

      
        	
                 

              	
                (B)

              	
                Employer,
                  by action of its Board of Directors, may terminate Employee’s employment
                  with Employer without cause at any
                  time.

              

      

       

      
        	
                 

              	
                (C)

              	
                Employee,
                  by written notice to Employer, may terminate his employment with
                  Employer
                  immediately for cause. For purposes of this subsection 7(C), “cause” shall
                  be defined as (i) any action by Employer’s Board of Directors to remove
                  the Employee as an Executive Vice President of Employer, except
                  where the
                  Employer’s Board of Directors properly acts to remove Employee from such
                  office for “cause” as defined in subsection 7(A) hereof, (ii) any action
                  by Employer’s Board of Directors to materially limit, increase, or
                  modify

              

      

       

      
        
          
          

        

        
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                Employee’s
                  duties and/or authority as an Executive Vice President of Employer
                  (including his authority, subject to corporate controls no more
                  restrictive than those in effect on the date hereof, to hire and
                  discharge
                  employees who are not bona fide officers of Employer), (iii) any
                  failure
                  of Employer to obtain the assumption of the obligation to perform
                  this
                  Agreement by any successor or the reaffirmation of such obligation
                  by
                  Employer, as contemplated in section 19 hereof; or (iv) any intentional
                  breach by Employer of a term, condition or covenant of this
                  Agreement.

              

      

       

      
        	
                 

              	
                (D)

              	
                Employee,
                  upon thirty (30) days written notice to Employer, may terminate
                  his
                  employment with Employer without
                  cause.

              

      

       

      
        	
                 

              	
                (E)

              	
                Employee’s
                  employment with Employer shall terminate in the event of Employee’s death
                  or disability.  For purposes hereof, “disability” shall be
                  defined as Employee’s inability by reason of illness or other physical or
                  mental incapacity to perform the duties required by his employment
                  for any
                  consecutive One Hundred Eighty (180) day period, provided that
                  notice of
                  any termination by Employer because of Employee’s “disability” shall have
                  been given to Employee prior to the full resumption by him of the
                  performance of such duties.

              

      

       

      8.           In
        the event of termination of Employee’s employment with Employer pursuant to
        section 7 hereof other than simultaneously with or following a Change of
        Control
        (as hereinafter defined), compensation shall continue to be paid by Employer
        to
        Employee as follows:

       

      
        	
                 

              	
                (A)

              	
                In
                  the event of termination pursuant to subsection 7(A) or 7(D), compensation
                  provided for herein (including Base Compensation) shall continue
                  to be
                  paid, and Employee shall continue to participate in the employee
                  benefit,
                  retirement, and compensation plans and other perquisites as provided
                  in
                  sections 5 and 6 hereof, through the date of termination specified
                  in the
                  notice of termination.  Any benefits payable under insurance,
                  health, retirement and bonus plans as a result of Employee’s participation
                  in such plans through such date shall be paid when due under those
                  plans.  The date of termination specified in any notice of
                  termination pursuant to Subsection 7(A) shall be no later than
                  the last
                  business day of the month in which such notice is provided to
                  Employee.

              

      

       

      
        	
                 

              	
                (B)

              	
                In
                  the event of termination pursuant to subsection 7(B) or 7(C), compensation
                  provided for herein (including Base Compensation) shall continue
                  to be
                  paid, and Employee shall continue to participate in the employee
                  benefit,
                  retirement, and compensation plans and other perquisites as provided
                  in
                  Sections 5 and 6 hereof, through the date of termination specified
                  in the
                  notice of termination.  Any benefits payable under insurance,
                  health, retirement and bonus plans as a result of Employee’s participation
                  in such plans through such date shall be paid when due under those
                  plans.  In addition, Employee shall be entitled to continue to
                  receive from Employer his Base Compensation at the rates in effect
                  at the
                  time of termination for the remaining Term of the Agreement.  In
                  addition, during such periods, Employer will maintain in full force
                  and
                  effect for the continued benefit of Employee each employee welfare
                  benefit
                  plan and each employee pension

              

      

       

      
        
          
          

        

        
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                benefit
                  plan (as such terms are defined in the Employee Retirement Income
                  Security
                  Act of 1974, as  amended) in which Employee was entitled to
                  participate immediately prior to the date of his termination, unless
                  an
                  essentially equivalent and no less favorable benefit is provided
                  by a
                  subsequent employer of Employee.  If the terms of any employee
                  welfare benefit plan or employee pension benefit plan of Employer
                  do not
                  permit continued participation by Employee, Employer will arrange
                  to
                  provide to Employee a benefit substantially similar to, and no
                  less
                  favorable than, the benefit he was entitled to receive under such
                  plan at
                  the end of the period of coverage.

              

      

       

      
        	
                 

              	
                (C)

              	
                In
                  the event of termination pursuant to subsection 7(E) other than
                  simultaneously with or following a Change in Control (as hereinafter
                  defined), compensation provided for herein (including Base Compensation)
                  shall continue to be paid, and Employee shall continue to participate
                  in
                  the employee benefit, retirement, and compensation plans and other
                  perquisites as provided in sections 5 and 6 hereof, (i) in the
                  event of
                  Employee’s death, through the date of death, or (ii) in the event of
                  Employee’s disability, through the date of proper notice of disability as
                  required by subsection 7(E).  Any benefits payable under
                  insurance, health, retirement and bonus plans as a result of Employer’s
                  participation in such plans through such date shall be paid when
                  due under
                  those plans.

              

      

       

      
        	
                 

              	
                (D)

              	
                In
                  the event there is a Change in Control during the Term, Employer
                  will
                  permit Employee or his personal representative(s) or heirs to require
                  Employer, upon written request, as of the effective date of the
                  Change in
                  Control,  to purchase all outstanding stock options previously
                  granted to Employee under any stock option plan of Employer or
                  any Holding
                  Company of Employer then in effect whether or not such options
                  are then
                  exercisable or have terminated at a cash purchase price equal to
                  the
                  amount by which the aggregate “fair market value” of the shares subject to
                  such options exceeds the aggregate option price for such
                  shares.  For purposes of this Agreement, the term “fair market
                  value” shall mean the higher of (1) the average of the highest asked
                  prices for Employer or Holding Company shares in the over-the-counter
                  market as reported on the NASDAQ system if the shares are traded
                  on such
                  system for the 30 business days preceding such termination, or
                  (2) the
                  average per share price actually paid for the most highly priced
                  1% of the
                  Employer or Holding Company shares acquired in connection with
                  the Change
                  of Control by any person or group acquiring such
                  control.

              

      

       

      
        	
                 

              	
                (E)

              	
                In
                  the event there is a Change of Control during the Term and without
                  regard
                  to whether the Employee’s employment is terminated in connection with the
                  Change of Control, this Agreement shall terminate upon payment
                  to the
                  Employee of a lump sum payment equal to three (3) times his Base
                  Compensation, any amounts owed to Employee under Section 8(D),
                  and the
                  continued payment to Employee through the date of termination of
                  this
                  Agreement of all compensation and benefits provided for in Sections
                  5 and
                  6 hereof.  Employer shall pay to Employee such amounts no later
                  than the effective date of the Change in Control.  For purposes
                  of this Agreement, a “Change of Control” shall mean any of the
                  following:

              

      

       

       

       

      
        
          
          

        

        
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                (1)

              	
                a
                  change in the ownership of the Employer or the Holding Company,
                  which
                  shall occur on the date that any one person, or more than one person
                  acting as a group, acquires ownership of stock of the Employer
                  or the
                  Holding Company that, together with stock held by such person or
                  group,
                  constitutes more than fifty percent (50%) of the total fair market
                  value
                  or total voting power of the stock of the Employer or the Holding
                  Company.  However, if any one person, or more than one person
                  acting as a group, is considered to own more than fifty percent
                  (50%) of
                  the total fair market value or total voting power of the stock
                  of the
                  Employer or the Holding Company, the acquisition of additional
                  stock by
                  the same person or persons is not considered to cause a change
                  in the
                  ownership of the Employer or the Holding Company (or to cause a
                  change in
                  the effective control of the Employer or the Holding Company (within
                  the
                  meaning of subsection (2)).  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 Employer or the Holding Company acquires
                  its
                  stock in exchange for property will be treated as an acquisition
                  of stock
                  for purposes of this subsection.  This subsection applies only
                  when there is a transfer of stock of the Employer or the Holding
                  Company
                  (or issuance of stock of the Employer or the Holding Company) and
                  stock in
                  the Employer or the Holding Company remains outstanding after the
                  transaction.

              

      

       

      
        	
                 

              	
                (2)

              	
                a
                  change in the effective control of the Employer or the Holding
                  Company,
                  which shall occur only on either of the following
                  dates:

              

      

       

      
        	
                 

              	
                (i)

              	
                the
                  date any one person, or more than one person acting as a group
                  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
                  Employer or the Holding Company possessing thirty percent (30%)
                  or more of
                  the total voting power of the stock of the Employer or the Holding
                  Company.

              

      

       

      
        	
                 

              	
                (ii)

              	
                the
                  date a majority of members of the Holding 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 Holding
                  Company’s board of directors before the date of the appointment or
                  election; provided, however, that this provision shall not apply
                  if
                  another corporation is a majority shareholder of the Holding
                  Company.

              

      

       

      If
        any
        one person, or more than one person acting as a group, is considered to
        effectively control the Employer or the Holding Company, the acquisition
        of
        additional control of the Employer or the Holding Company by the same person
        or
        persons is not considered to cause a change in the effective control of the
        Employer or the Holding Company (or to cause a change in the ownership of
        the
        Employer or the Holding Company within the meaning of subsection (1) of this
        section).

       

       

      
        
          
          

        

        
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                (3)

              	
                a
                  change in the ownership of a substantial portion of the Employer’s assets,
                  which shall occur on the date that any one person, or more than
                  one person
                  acting as a group, 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 Employer that have a total gross fair
                  market
                  value equal to or more than forty percent (40%) of the total gross
                  fair
                  market value of all of the assets of the Employer immediately before
                  such
                  acquisition or acquisitions.  For this purpose, gross fair
                  market value means the value of the assets of the Employer, or
                  the value
                  of the assets being disposed of, determined without regard to any
                  liabilities associated with such assets.  No change in control
                  event occurs under this subsection (3) when there is a transfer
                  to an
                  entity that is controlled by the shareholders of the Employer immediately
                  after the transfer.  A transfer of assets by the Employer is not
                  treated as a change in the ownership of such assets if the assets
                  are
                  transferred to –

              

      

       

      
        	
                 

              	
                (i)

              	
                a
                  shareholder of the Employer (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
                  Employer.

              

      

       

      
        	
                 

              	
                (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 Employer;
                  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 paragraph
                  (iii).

              

      

       

      For
        purposes of this subsection (3) and except as otherwise provided in paragraph
        (i) above, a person’s status is determined immediately after the transfer of the
        assets.  For purposes of this section, persons will not be considered
        to be acting as a group solely because they 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, or similar business transaction with the
        Employer.  If a person, including an entity, 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 only with respect to the ownership in that
        corporation before the transaction giving rise to the change and not with
        respect to the ownership interest in the other corporation.

       

       

      
        
          
          

        

        
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                (F)

              	
                To
                  the extent the Employee is a “specified employee” (as defined below),
                  payments due to the Employee under this Section 8 (other than those
                  provided for in Sections 8(D) and 8(E)) shall begin no sooner than
                  six
                  months after the Employee’s separation from service; provided, however,
                  that any payments not made during the six month period described
                  in this
                  Section 8(F) shall be made in a single lump sum as soon as
                  administratively practicable after the expiration of such six month
                  period; provided, further, that the six month delay required under
                  this
                  Section 8(F) shall not apply to the portion of any payment resulting
                  from the Employee’s “involuntary separation from service” (as defined in
                  Treasury Reg. Section 1.409A-1(n) and including a “separation from
                  service for good reason,” as defined in Treasury Reg.
                  Section 1.409A-1(n)(2)) that (i) is payable no later than the last
                  day of the second year following the year in which the separation
                  from
                  service occurs, and (ii) does not exceed two times the lesser of
                  (1) the
                  Employee’s annualized compensation for the year prior to the year in which
                  the separation from service occurs, or (2) the dollar limit described
                  in
                  Section 401(a)(17) of the
                  Code.

              

      

       

      To
        the
        extent any life, health, disability or other welfare benefit coverage provided
        to the Employee under this Section 8 would be taxable to the Employee, the
        taxable amount of such coverage shall not exceed the applicable dollar amount
        under Section 402(g)(1)(B) of the Code determined as of the year in which
        the Employee’s separation from service occurs.  The intent of the
        foregoing sentence is to permit the Holding Company and the Employer to treat
        the provision of such benefits as a limited payment under Treasury Reg.
        Section 1.409A-1(a)(9)(v)(D) so as to avoid application of the six month
        delay rule for specified employees.  For purposes of this
        Section 8, any reference to severance of employment or termination of
        employment shall mean a “separation from service” as defined in Treasury Reg.
        Section 1.409A-1(h).

       

      For
        purposes of this Agreement, the term “specified employee” shall have the meaning
        set forth in Treasury Reg. Section 1.409A-1(i) and shall include, without
        limitation, (1) an officer of the Employer or the Holding Company having
        annual
        compensation greater than $130,000 (as adjusted for inflation under the Code),
        (2) a five percent owner of the Employer or the Holding Company, or (3) a
        one
        percent owner of the Employer or the Holding Company having annual compensation
        of more than $150,000.  The determination of whether the Employee is a
“specified employee” shall be made by the Employer in good faith applying the
        applicable Treasury regulations.

       

      9.           In
        order to induce Employer to enter into this Agreement, Employee hereby agrees
        as
        follows:

       

      
        	
                 

              	
                (A)

              	
                While
                  Employee is employed by Employer and for a period of three years
                  after
                  termination of such employment for reasons other than those set
                  forth in
                  subsections 7(B) or (C) of this Agreement, Employee shall not divulge
                  or
                  furnish any trade secrets (as defined in IND. CODE § 24-2-3-2) of
                  Employer or any confidential information acquired by him while
                  employed by
                  Employer

              

      

       

      
        
          
          

        

        
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      concerning
        the policies, plans, procedures or customers of Employer to any person, firm
        or
        corporation, other than Employer or upon its written request, or use any
        such
        trade secret or confidential information directly or indirectly for Employee’s
        own benefit or for the benefit of any person, firm or corporation other than
        Employer, since such trade secrets and confidential information are confidential
        and shall at all times remain the property of Employer.

       

      
        	
                 

              	
                (B)

              	
                If
                  Employee’s employment by Employer is terminated for reasons other than
                  those set forth in subsections 7(B) or (C) of this Agreement, Employee
                  will turn over immediately thereafter to Employer all business
                  correspondence, letters, papers, reports, customers’ lists, financial
                  statements, credit reports or other confidential information or
                  documents
                  of Employer or its affiliates in the possession or control of Employee,
                  all of which writings are and will continue to be the sole and
                  exclusive
                  property of Employer or its
                  affiliates.

              

      

       

      If
        Employee’s employment by Employer is terminated during the Term of this
        Agreement for reasons set forth in subsections 7(B) or (C) of this Agreement,
        Employee shall have no obligations to Employer with respect to trade secrets
        or
        confidential information under this section 9.

       

      10.           Any
        termination of Employee’s employment with Employer as contemplated by section 7
        hereof, except in the circumstances of Employee’s death, shall be communicated
        by written “Notice of Termination” by the terminating party to the
        other  party hereto.  Any “Notice of Termination” pursuant
        to subsections 7(A), 7(C) or 7(E) shall indicate the specific provisions
        of this
        Agreement relied upon and shall set forth in reasonable detail the facts
        and
        circumstances claimed to provide a basis for such termination.

       

      11.           If
        Employee is suspended and/or temporarily prohibited from participating in
        the
        conduct of Employer’s affairs by a notice served under section 8(e)(3) or (g)(1)
        of the Federal Deposit Insurance Act (12 U.S.C. § 1818(e)(3) and (g)(1)),
        Employer’s obligations under this Agreement shall be suspended as of the date of
        service, unless stayed by appropriate proceedings.  If the charges in
        the notice are dismissed, Employer may in its discretion (i) pay Employee
        all or
        part of the compensation withheld while its obligations under this Agreement
        were suspended and (ii) reinstate (in whole or in part) any of its obligations
        which were suspended.

       

      12.           If
        Employee is removed and/or permanently prohibited from participating in the
        conduct of Employer’s affairs by an order issued under section 8(e)(4) or (g)(1)
        of the Federal Deposit Insurance Act (12 U.S.C. § 1818(e)(4) or (g)(1)),
        all obligations of Employer under this Agreement shall terminate as of the
        effective date of the order, but vested rights of the parties to the Agreement
        shall not be affected.  If Employer is in default (as defined in
        section 3(x)(1) of the Federal Deposit Insurance Act), all obligations under
        this Agreement shall terminate as of the date of default, but this provision
        shall not affect any vested rights of Employer or Employee.

       

      13.           All
        obligations under this Agreement may be terminated except to the extent
        determined that the continuation of the Agreement is necessary for the continued
        operation of Employer:  (i) by the Director of the Indiana Department
        of Financial Institutions, or his

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      designee
        (the “Director”), at the time the Federal Deposit Insurance Corporation enters
        into an agreement to provide assistance to or on behalf of Employer under
        the
        authority contained in Section 13(c) of the Federal Deposit Insurance Act;
        or
        (ii) by the Director at the time the Director approves a supervisory merger
        to
        resolve problems related to operation of Employer or when Employer is determined
        by the Director to be in an unsafe and unsound condition.  Any rights
        of the parties that have already vested, however, shall not be affected by
        such
        action.

       

      14.           Anything
        in this Agreement to the contrary notwithstanding, in the event that the
        Employer’s independent public accountants determine that any payment by the
        Employer to or for the benefit of the Employee, whether paid or payable pursuant
        to the terms of this Agreement, would be non-deductible by the Employer for
        federal income tax purposes because of Section 280G of the Internal Revenue
        Code
        of 1986, as amended (the “Code”), then the amount payable to or for the benefit
        of the Employee pursuant to this Agreement shall be reduced (but not below
        zero)
        to the Reduced Amount.  For purposes of this section 14, the “Reduced
        Amount” shall be the amount that maximizes the amount payable without causing
        the payment to be non-deductible by the Employer because of Section 280G
        of the
        Code.  In the event the Employee is entitled to receive payments
        following a Change in Control under a Supplemental Retirement Agreement with
        the
        Employer which payments, together with the amounts payable to the Employee
        under
        this Agreement would result in a tax under §4999 of the Code, the amounts
        payable to the Employee pursuant to this Agreement shall be reduced first,
        before any reduction is made in payments under the Supplemental Retirement
        Agreement, to the extent necessary to avoid a tax imposed under §4999 of the
        Code.

       

      15.           If
        a dispute arises regarding the termination of Employee pursuant to section
        7
        hereof or as to the interpretation or enforcement of this Agreement and Employee
        obtains a final judgment in his favor in a court of competent jurisdiction
        or
        his claim is settled by Employer prior to the rendering of a judgment by
        such a
        court, all reasonable legal fees and expenses incurred by Employee in contesting
        or disputing any such termination or seeking to obtain or enforce any right
        or
        benefit provided for in this Agreement or otherwise pursuing his claim shall
        be
        paid by Employer, to the extent permitted by law.

       

      16.           Should
        Employee die after termination of his employment with Employer while any
        amounts
        are payable to him hereunder, this Agreement shall inure to the benefit of
        and
        be enforceable by Employee’s executors, administrators, heirs, distributees,
        devisees and legatees and all amounts payable hereunder shall be paid in
        accordance with the terms of this Agreement to Employee’s devisee, legatee or
        other designee or, if there is no such designee, to his estate.

       

      17.           For
        purposes of this Agreement, notices and all other communications provided
        for
        herein shall be in writing and shall be deemed to have been given when delivered
        or mailed by United States registered or certified mail, return receipt
        requested, postage prepaid, addressed as follows:

       

      
        	 	
                If
                  to Employee:

              	
                Charles
                  R. Farber

              
	 	 	
                650
                  Shoreline Dr.

              
	 	 	
                Columbus,
                  IN 47201

              

      

       

       

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      
 

      
        	 	
                If
                  to Employer:

              	
                Home
                  Federal Savings Bank

              
	 	 	
                Attn:  CEO

              
	 	 	
                501
                  Washington Street

              
	 	 	
                Columbus,
                  IN 47201

              

      

      

      or
        to
        such address as either party hereto may have furnished to the other party
        in
        writing in accordance herewith, except that notices of change of address
        shall
        be effective only upon receipt.

       

      18.           The
        validity, interpretation, and performance of this Agreement shall be governed
        by
        the laws of the State of Indiana.

       

      19.           Employer
        shall require any successor (whether direct or indirect, by purchase, merger,
        consolidation or otherwise) to all or substantially all of the business or
        assets of Employer, by agreement in form and substance satisfactory to Employee
        to expressly assume and agree to perform this Agreement in the same manner
        and
        same extent that Employer would be required to perform it if no such succession
        had taken place.  Failure of Employer to obtain such agreement prior
        to the effectiveness of any such succession shall be a material intentional
        breach of this Agreement and shall entitle Employee to terminate his employment
        with Employer pursuant to subsection 7(C) hereof. As used in this Agreement,
        “Employer” shall mean Employer as hereinbefore defined and any successor to its
        business or assets as aforesaid.

       

      20.           No
        provision of this Agreement may be modified, waived or discharged unless
        such
        waiver, modification or discharge is agreed to in writing signed by Employee
        and
        Employer.  No waiver by either party hereto at any time of any breach
        by the other party hereto of, or compliance with, any condition or provision
        of
        this Agreement to be performed by such other party shall be deemed a waiver
        of
        dissimilar provisions or conditions at the same or any prior subsequent
        time.  No agreements or representation, oral or otherwise, express or
        implied, with respect to the subject matter hereof have been made by either
        party which are not set forth expressly in this Agreement.

       

      21.           The
        invalidity or unenforceability of any provisions of this Agreement shall
        not
        affect the validity or enforceability of any other provisions of this Agreement
        which shall remain in full force and effect.

       

      22.           This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed an original but all of which together shall constitute one and the
        same
        agreement.

       

      23.           This
        Agreement is personal in nature and neither party hereto shall, without consent
        of the other, assign or transfer this Agreement or any rights or obligations
        hereunder except as provided in section 16 and section 19
        above.  Without limiting the foregoing, Employee’s right to receive
        compensation hereunder shall not be assignable or transferable, whether by
        pledge, creation of a security interest or otherwise, other than a transfer
        by
        his will or by the laws of descent or distribution as set forth in section
        16
        hereof, and in the event of any attempted assignment or transfer contrary
        to
        this paragraph, Employer shall have no liability to pay any amounts so attempted
        to be assigned or transferred.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      24.           The
        Holding Company agrees that if it shall be determined for any reason that
        any
        obligation on the part of Employer to continue to make any payments due under
        this Agreement to Employee or to satisfy any other obligation under this
        Agreement for the benefit of Employee is unenforceable for any reason, the
        Holding Company agrees to honor the terms of this Agreement and continue
        to make
        any such payments due hereunder to Employee or to satisfy any such obligation
        pursuant to the terms of this Agreement, as though it were the Employer
        hereunder.

       

      IN
        WITNESS WHEREOF, the parties have caused this Amended and Restated Employment
        Agreement to be executed and delivered as of the day and year first above
        set
        forth.

       

      

      
        	 	
                HOME
                  FEDERAL SAVINGS BANK

              
	 	 	 
	 	 	 
	 	
                By:

              	/s/
                John K. Keach, Jr.
	 	 	
                John
                  K. Keach, Jr., President and Chief Executive Officer

              
	 	 
	 	
                “Employer”

              
	 	 	 
	 	 	 
	 	 	 
	 	/s/
                Charles R. Farber
	 	
                Charles
                  R. Farber

              
	 	 	 
	 	
                “Employee”

              
	 	 	 
	 	
                HOME
                  FEDERAL BANCORP

              
	 	 	 
	 	 	 
	 	
                By:

              	/s/
                John K. Keach, Jr.
	 	 	
                John
                  K. Keach, Jr., President and Chief Executive Officer

              
	 	 	 
	 	
                “Holding
                  Company”

              

      

      

      

      
 

      12hfb_8k0724ex1010.htm

    

      Exhibit
        10.10

      

      

      HOMEFEDERAL
        BANK

      SECOND
        AMENDED AND RESTATED

      SUPPLEMENTAL
        EXECUTIVE RETIREMENT AGREEMENT

      FOR
        S. ELAINE POLLERT

      

      THIS
        SECOND AMENDED & RESTATED
        SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT (the “Agreement”) is adopted this
        27th day of July, 2007, by and between HOMEFEDERAL BANK f/k/a HOME FEDERAL
        SAVINGS BANK, a State chartered bank located in Columbus, Indiana (the “Bank”)
        and S. Elaine Pollert (the “Executive”).

      

      The
        Bank and the Executive executed an
        Executive Supplemental Retirement Income Agreement on June 23, 1992, and
        amended
        it several times (the “First Agreement”).  The parties amended and
        restated the First Agreement on April 1, 2001 (the “Second
        Agreement”).  The parties then entered into an additional Supplemental
        Executive Retirement Agreement on effective July 1, 2005 (the “Third
        Agreement”).  The First, Second and Third Agreements are referred to
        collectively herein as the “Prior Agreements.”

      

      The
        parties intend this Amended and Restated Agreement to be a material modification
        and combination of the Prior Agreements such that all amounts earned and
        vested
        prior to December 31, 2004 shall be subject to the provisions of Section
        409A of
        the Code and the regulations promulgated thereunder.

      

      The
        purpose of this Agreement is to provide specified benefits to the Executive,
        a
        member of a select group of management or highly compensated employees who
        contribute materially to the continued growth, development, and future business
        success of the Bank.  This Agreement shall be unfunded for tax
        purposes and for purposes of Title I of the Employee Retirement Income Security
        Act of 1974 (“ERISA”), as amended from time to time.

      

      Article
        1

      Definitions

      

      Whenever
        used in this Agreement, the
        following words and phrases shall have the meanings specified:

      

      
        	
                1.1

              	
                “Beneficiary”
                  means each designated person, or the estate of the deceased Executive,
                  entitled to benefits, if any, upon the death of the Executive determined
                  pursuant to Article 4.

              

      

      

      
        	
                1.2

              	
                “Beneficiary
                  Designation Form” means the form established from time to time by the
                  Plan Administrator that the Executive completes, signs, and returns
                  to the
                  Plan Administrator to designate one or more
                  Beneficiaries.

              

      

      

      
        	
                1.3

              	
                “Board”
                  means the Board of Directors of the Bank as from time to time
                  constituted.

              

      

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      
        	
                1.4

              	
                “Code”
                  means the Internal Revenue Code of 1986, as
                  amended.

              

      

      

      
        	
                1.5

              	
                “Corporation”
                  means Home Federal Bancorp, an Indiana corporation, and the sole
                  shareholder of the Bank.

              

      

      

      
        	
                1.6

              	
                “Disability”
                  means Executive: (i) is unable to engage in any substantial gainful
                  activity by reason of any medically determinable physical or mental
                  impairment which can be expected to result in death or can be expected
                  to
                  last for a continuous period of not less than twelve (12) months;
                  or (ii)
                  is, by reason of any medically determinable physical or mental
                  impairment
                  which can be expected to result in death or can be expected to
                  last for a
                  continuous period of not less than twelve (12) months, receiving
                  income
                  replacement benefits for a period of not less than three (3) months
                  under
                  an accident and health plan covering employees of the
                  Bank.  Medical determination of Disability may be made by either
                  the Social Security Administration or by the provider of an accident
                  or
                  health plan covering employees of the Bank.  Upon the request of
                  the Plan Administrator, the Executive must submit proof to the
                  Plan
                  Administrator of the Social Security Administration’s or the provider’s
                  determination.

              

      

      

      
        	
                1.7

              	
                “Effective
                  Date” means January 1, 2005.

              

      

      

      
        	
                1.8

              	
                “Normal
                  Retirement Age” means the Executive attaining age fifty
                  (50).

              

      

      

      
        	
                1.9

              	
                “Normal
                  Retirement Date” means the later of Normal Retirement Age or
                  Separation from Service.

              

      

      

      
        	
                1.9

              	
                “Plan
                  Administrator” means the plan administrator described in Article
                  6.

              

      

      

      
        	
                1.10

              	
                “Plan
                  Year” means each twelve-month period commencing on July 1 and ending
                  on June 30 of each year.  The initial Plan Year shall commence
                  on the Effective Date of this Agreement and end on the following
                  June 30,
                  2006.

              

      

      

      
        	
                1.11

              	
                “Separation
                  from Service”
means
                  the
                  termination of the Executive’s
                  employment with
                  the Bank
                  for reasons other than death.  Whether
                  a Separation from Service takes place is determined based on the
                  facts and
                  circumstances surrounding the termination of the Executive’s
                  employment.  A
                  termination of employment will be considered to
                  have
                  occurred if
                  it is
                  reasonably anticipated that:

              

      

      

      
        	
                 

              	
                (a)

              	
                the
                  Executive will not perform any services for the Bank after Termination
                  of
                  Employment, or

              

      

       

      
        	
                 

              	
                (b)

              	
                the
                  Executive will continue to provide services to the Bank at an annual
                  rate
                  that is less than fifty percent (50%) of the bona fide services
                  rendered
                  during the immediately preceding twelve (12) months of
                  employment.

              

      

       

      
        	
                1.12

              	
                “Specified
                  Employee” means a key employee (as defined in Section 416(i) of the
                  Code without regard to paragraph 5 thereof) of the Bank if any
                  stock of
                  the Bank or any entity

              

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                required
                  to be aggregated with the Bank under Section 414(b) or 414(c) of
                  the Code
                  is publicly traded on an established securities market or
                  otherwise.

              

      

      

      
        	
                1.13

              	
                “Termination
                  for Cause” means Separation from Service
                  for:

              

      

      

      
        	
                 

              	
                (a)

              	
                Personal
                  dishonesty; or

              

      

      
        	
                 

              	
                (b)

              	
                Incompetence;
                  or

              

      

      
        	
                 

              	
                (c)

              	
                Willful
                  misconduct; or

              

      

      
        	
                 

              	
                (d)

              	
                Breach
                  of fiduciary duty involving personal profit;
                  or

              

      

      
        	
                 

              	
                (e)

              	
                Intentional
                  failure to perform stated duties;
                  or

              

      

      
        	
                 

              	
                (f)

              	
                Willful
                  violation of any law, rule or regulation (other than traffic violations
                  or
                  similar offenses) or final cease-and-desist
                  order.

              

      

      

      Article
        2

      Distributions
        During Lifetime

      

      
        	
                2.1

              	
                Retirement
                  Benefit.  Upon the Normal Retirement Date, the Bank shall
                  distribute to the Executive the benefit described in this Section
                  2.1 in
                  lieu of any other benefit under this
                  Article.

              

      

      

      
        	
                 

              	
                2.1.1

              	
                Amount
                  of Benefit.  The annual benefit under this Section 2.1 is
                  Fifty Thousand Dollars ($50,000).

              

      

      

      
        	
                 

              	
                2.1.2

              	
                Distribution
                  of Benefit.  The Bank shall distribute the annual benefit to
                  the Executive in twelve (12) equal monthly installments commencing
                  on the
                  first day of the month following the Normal Retirement
                  Date.  The annual benefit shall be distributed to the Executive
                  for fifteen (15) years.

              

      

      

      
        	
                2.2

              	
                Disability
                  Benefit.  If the Executive experiences a Disability
                  which results in a Separation from Service prior to Normal Retirement
                  Age,
                  the Bank shall distribute to the Executive the benefit described
                  in this
                  Section 2.2 in lieu of any other benefit under this
                  Article.

              

      

      

      
        	
                 

              	
                2.2.1

              	
                Amount
                  of Benefit.  The annual benefit under this Section 2.2 is
                  Fifty Thousand Dollars ($50,000).

              

      

      

      
        	
                 

              	
                2.2.2

              	
                Distribution
                  of Benefit.  The Bank shall distribute the annual benefit to
                  the Executive in twelve (12) equal monthly installments commencing
                  within
                  sixty (60) days following Separation from Service due to such
                  Disability.  The annual benefit shall be distributed to the
                  Executive for fifteen (15) years.

              

      

      

      
        	
                2.3

              	
                Restriction
                  on Timing of
                  Distribution. 
Notwithstanding
                  any
                  provision of this Agreement to the contrary, if the Executive is
                  considered a Specified Employee at Separation from Service under
                  such
                  procedures as established by the Bank in accordance with Section
                  409A of
                  the Code, benefit distributions that are made upon Separation from
                  Service
                  may not commence earlier than six (6) months after the date of
                  such Separation
                  from Service;

              

      

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                provided,
                  however, that the six (6) month delay required under this Section
                  2.3
                  shall not apply to the portion of any payment resulting from the
                  Executive’s “involuntary separation from service” (as defined in Treas.
                  Reg. § 1.409A-1(n) and including a “separation from service for good
                  reason,” as defined in Treas. Reg. § 1.409A-1(n)(2)) that (a) is
                  payable no later than the last day of the second year following
                  the year
                  in which the separation from service occurs, and (b) does not exceed
                  two
                  times the lesser of (i) the Executive’s annualized compensation for the
                  year prior to the year in which the separation from services occurs,
                  or
                  (ii) the dollar limit described in Section 401(a)(17) of the
                  Code.  Therefore, in the event this Section 2.3 is applicable to
                  the Executive, any distribution which would otherwise be paid to
                  the
                  Executive within the first six months following the Separation
                  from
                  Service shall be accumulated and paid to the Executive in a lump
                  sum on
                  the first day of the seventh month following the Separation from
                  Service.  All subsequent distributions shall be paid in the
                  manner specified.

              

      

      

      
        	
                2.4

              	
                Distributions
                  Upon Income Inclusion Under Section 409A of the Code.  Upon
                  the inclusion of any amount into the Executive’s income as a result of the
                  failure of this non-qualified deferred compensation plan to comply
                  with
                  the requirements of Section 409A of the Code, to the extent such
                  tax
                  liability can be covered by the amount the Bank has accrued with
                  respect
                  to the Bank’s obligations hereunder, a distribution shall be made as soon
                  as is administratively practicable following the discovery of the
                  plan
                  failure.

              

      

      

      
        	
                2.5

              	
                Change
                  in Form or Timing of Distributions.  All changes in the form
                  or timing of distributions hereunder must comply with the following
                  requirements.  The
                  changes:

              

      

      

      
        	
                 

              	
                (a)

              	
                may
                  not accelerate the time or schedule of any distribution, except
                  as
                  provided in Section 409A of the Code and the regulations
                  thereunder;

              

      

      
        	
                 

              	
                (b)

              	
                must,
                  for benefits distributable under Sections 2.1 and 2.2, delay the
                  commencement of distributions for a minimum of five (5) years from
                  the
                  date the first distribution was originally scheduled to be made;
                  and

              

      

      
        	
                 

              	
                (c)

              	
                must
                  take effect not less than twelve (12) months after the election
                  is
                  made.

              

      

      

      Article
        3

      Distribution
        at Death

      

      
        	
                3.1

              	
                Death
                  During Active Service.  If the Executive dies while in the
                  active service of the Bank, the Bank shall distribute to the Beneficiary
                  the benefit described in this Section 3.1. This benefit shall be
                  distributed in lieu of the benefits under Article
                  2.

              

      

      

      
        	
                 

              	
                3.1.1

              	
                Amount
                  of Benefit.  The benefit under this Section 3.1 is the
                  Normal Retirement Benefit amount described in Section
                  2.1.1.

              

      

      

      
        	
                 

              	
                3.1.2

              	
                Distribution
                  of Benefit.  The Bank shall distribute the annual benefit to
                  the Beneficiary in twelve (12) equal monthly installments commencing
                  within sixty

              

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      (60)
        days
        following receipt by the Bank of the Executive’s death
        certificate.  The annual benefit shall be distributed to the
        Beneficiary for fifteen (15) years.

       

      
        	
                3.2

              	
                Death
                  During Distribution of a Benefit.  If the Executive dies
                  after any benefit distributions have commenced under this Agreement
                  but
                  before receiving all such distributions, the Bank shall distribute
                  to the
                  Beneficiary the remaining benefits at the same time and in the
                  same
                  amounts they would have been distributed to the Executive had the
                  Executive survived.

              

      

       

      
        	
                3.3

              	
                Death
                  After Separation from Service But Before Benefit Distributions
                  Commence. If the Executive is entitled
                  to benefit distributions under this Agreement, but dies prior to
                  the
                  commencement of said benefit distributions, the Bank shall distribute
                  to
                  the Beneficiary the same benefits that the Executive was entitled
                  to prior
                  to death except that the benefit distributions shall commence within
                  sixty
                  (60) days following receipt by the Bank of the Executive’s death
                  certificate.

              

      

      

      
        	
                3.4

              	
                Burial
                  Benefit.  In addition to the above-described death benefits,
                  the Executive’s Beneficiary shall be entitled to a one-time lump sum death
                  benefit in the amount of Fifteen Thousand Dollars
                  ($15,000).  The payment shall be made within thirty (30) days
                  following receipt by the Bank of the Executive’s death
                  certificate.

              

      

      

       

      Article
        4

      Beneficiaries

      

      
        	
                4.1

              	
                Beneficiary.  The
                  Executive shall have the right, at any time, to designate a Beneficiary
                  to
                  receive any benefit distributions under this Agreement upon the
                  death of
                  the Executive.  The Beneficiary designated under this Agreement
                  may be the same as or different from the beneficiary designation
                  under any
                  other plan of the Bank in which the Executive
                  participates.

              

      

      

      
        	
                4.2

              	
                Beneficiary
                  Designation: Change.  The Executive shall designate a
                  Beneficiary by completing and signing the Beneficiary Designation
                  Form,
                  and delivering it to the Plan Administrator or its designated
                  agent.  The Executive's beneficiary designation shall be deemed
                  automatically revoked if the Beneficiary predeceases the Executive
                  or if
                  the Executive names a spouse as Beneficiary and the marriage is
                  subsequently dissolved.  The Executive shall have the right to
                  change a Beneficiary by completing, signing and otherwise complying
                  with
                  the terms of the Beneficiary Designation Form and the Plan Administrator’s
                  rules and procedures, as in effect from time to time.  Upon the
                  acceptance by the Plan Administrator of a new Beneficiary Designation
                  Form, all Beneficiary designations previously filed shall be
                  cancelled.  The Plan Administrator shall be entitled to rely on
                  the last Beneficiary Designation Form filed by the Executive and
                  accepted
                  by the Plan Administrator prior to the Executive’s
                  death.

              

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      
        	
                4.3

              	
                Acknowledgment.  No
                  designation or change in designation of a Beneficiary shall be
                  effective
                  until received, accepted and acknowledged in writing by the Plan
                  Administrator or its designated
                  agent.

              

      

      

      
        	
                4.4

              	
                No
                  Beneficiary Designation.  If the Executive dies without a
                  valid beneficiary designation, or if all designated Beneficiaries
                  predecease the Executive, then the Executive’s spouse shall be the
                  designated Beneficiary.  If the Executive has no surviving
                  spouse, the benefits shall be made to the personal representative
                  of the
                  Executive's estate.

              

      

      

      
        	
                4.5

              	
                Facility
                  of Distribution.  If the Plan Administrator determines in
                  its discretion that a benefit is to be distributed to a minor,
                  to a person
                  declared incompetent, or to a person incapable of handling the
                  disposition
                  of that person’s property, the Plan Administrator may direct distribution
                  of such benefit to the guardian, legal representative or person
                  having the
                  care or custody of such minor, incompetent person or incapable
                  person.  The Plan Administrator may require proof of
                  incompetence, minority or guardianship as it may deem appropriate
                  prior to
                  distribution of the benefit.  Any distribution of a benefit
                  shall be a distribution for the account of the Executive and the
                  Executive’s Beneficiary, as the case may be, and shall be a complete
                  discharge of any liability under the Agreement for such distribution
                  amount.

              

      

      

      Article
        5

      General
        Limitations

      

      
        	
                5.1

              	
                Termination
                  for Cause.  Notwithstanding any provision of this Agreement
                  to the contrary, the Bank shall not distribute any benefit under
                  this
                  Agreement if the Executive’s employment with the Bank is terminated due to
                  a Termination for Cause.

              

      

      

      
        	
                5.2

              	
                Suicide
                  or Misstatement.  No benefits shall be distributed if the
                  Executive commits suicide within two years after the Effective
                  Date of
                  this Agreement, or if an insurance company which issued a life
                  insurance
                  policy covering the Executive and owned by the Bank denies coverage
                  (i)
                  for material misstatements of fact made by the Executive on an
                  application
                  for such life insurance, or (ii) for any other
                  reason.

              

      

      

      
        	
                5.3

              	
                Removal. Notwithstanding
                  any provision of this Agreement to the contrary, the Bank shall
                  not
                  distribute any benefit under this Agreement if the Executive is
                  subject to
                  a final removal or prohibition order issued by an appropriate federal
                  banking agency pursuant to Section 8(e) of the Federal Deposit
                  Insurance
                  Act.

              

      

      

      
        	
                5.4

              	
                Excess
                  Parachute or Golden Parachute Payment.  Notwithstanding any
                  provision of this Agreement to the contrary, to the extent any
                  distributions, if made, would be treated as an “excess parachute payment”
                  under Section 280G of the Code, the Bank shall reduce or delay
                  the
                  distributions to the extent it would not be an excess parachute
                  payment.

              

      

      

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                Article
                  6

              

      

      Administration
        of Agreement

      

      
        	
                6.1

              	
                Plan
                  Administrator Duties.  This Agreement shall be administered
                  by a Plan Administrator which shall consist of the Board, or such
                  committee or persons as the Board shall appoint.  The Plan
                  Administrator shall administer this Agreement according to its
                  express
                  terms and shall also have the discretion and authority to (i) make,
                  amend,
                  interpret and enforce all appropriate rules and regulations for
                  the
                  administra­tion of this Agreement and (ii) decide or resolve any and
                  all ques­tions including interpretations of this Agreement, as may
                  arise in connection with the Agreement to the extent the exercise
                  of such
                  discretion and authority does not conflict with Section 409A of
                  the Code
                  and regulations thereunder.

              

      

      

      
        	
                6.2

              	
                Agents.  In
                  the administration of this Agreement, the Plan Administrator may
                  employ
                  agents and delegate to them such administrative duties as it sees
                  fit,
                  (including acting through a duly appointed representative), and
                  may from
                  time to time consult with counsel who may be counsel to the
                  Bank.

              

      

      

      
        	
                6.3

              	
                Binding
                  Effect of Decisions.  The decision or action of the Plan
                  Administrator with respect to any question arising out of or in
                  connection
                  with the administration, interpretation and application of the
                  Agreement
                  and the rules and regulations promulgated hereunder shall be final
                  and
                  conclusive and binding upon all persons having any interest in
                  the
                  Agreement.

              

      

      

      
        	
                6.4

              	
                Indemnity
                  of Plan Administrator.  The Bank shall indemnify and hold
                  harmless the members of the Plan Administrator against any and
                  all claims,
                  losses, damages, expenses or liabilities arising from any action
                  or
                  failure to act with respect to this Agreement, except in the case
                  of
                  willful misconduct by the Plan Administrator or any of its
                  members.

              

      

      

      
        	
                6.5

              	
                Bank
                  Information.  To enable the Plan Administrator to perform
                  its functions, the Bank shall supply full and timely information
                  to the
                  Plan Administrator on all matters relating to the date and
                  circum­stances of the retirement, Disability, death, or Separation
                  from Service of the Executive, and such other pertinent information
                  as the
                  Plan Administrator may reasonably
                  require.

              

      

      

      Article
        7

      Claims
        And Review Procedures

      

      
        	
                7.1

              	
                Claims
                  Procedure.  An Executive or Beneficiary (“Claimant”) who has
                  not received benefits under the Agreement that he or she believes
                  should
                  be distributed shall make a claim for such benefits as
                  follows:

              

      

      

      
        	
                 

              	
                7.1.1

              	
                Initiation
                  – Written Claim.  The Claimant initiates a claim by
                  submitting to the Plan Administrator a written claim for the
                  benefits.  If such a claim relates to
                  the

              

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      contents
        of a notice received by the Claimant, the claim must be made within sixty
        (60) days after such notice was received by the Claimant.  All
        other claims must be made within one hundred eighty (180) days of the date
        on which the event that caused the claim to arise occurred.  The claim
        must state with particularity the determination desired by the
        Claimant.

       

      

      
        	
                 

              	
                7.1.2

              	
                Timing
                  of Plan Administrator Response.  The Plan
                  Administrator shall respond to such Claimant within 90 days after
                  receiving the claim.  If the Plan Administrator determines that
                  special circumstances require additional time for processing the
                  claim,
                  the Plan Administrator can extend the response period by an additional
                  90
                  days by notifying the Claimant in writing, prior to the end of
                  the initial
                  90-day period, that an additional period is required.  The
                  notice of extension must set forth the special circumstances and
                  the date
                  by which the Plan Administrator expects to render its
                  decision.

              

      

      

      
        	
                 

              	
                7.1.3

              	
                Notice
                  of Decision.  If the Plan Administrator denies part or all
                  of the claim, the Plan Administrator shall notify the Claimant
                  in writing
                  of such denial.  The Plan Administrator shall write the
                  notification in a manner calculated to be understood by the
                  Claimant.  The notification shall set
                  forth:

              

      

      

      
        	
                 

              	
                (a)

              	
                The
                  specific reasons for the denial;

              

      

      
        	
                 

              	
                (b)

              	
                A
                  reference to the specific provisions of the Agreement on which
                  the denial
                  is based;

              

      

      
        	
                 

              	
                (c)

              	
                A
                  description of any additional information or material necessary
                  for the
                  Claimant to perfect the claim and an explanation of why it is
                  needed;

              

      

      
        	
                 

              	
                (d)

              	
                An
                  explanation of the Agreement’s review procedures and the time limits
                  applicable to such procedures; and

              

      

      
        	
                 

              	
                (e)

              	
                A
                  statement of the Claimant’s right to bring a civil action under ERISA
                  Section 502(a) following an adverse benefit determination on
                  review.

              

      

      

      
        	
                7.2

              	
                Review
                  Procedure.  If the Plan Administrator denies part or all of
                  the claim, the Claimant shall have the opportunity for a full and
                  fair
                  review by the Plan Administrator of the denial, as
                  follows:

              

      

      

      
        	
                 

              	
                7.2.1

              	
                Initiation
                  – Written Request.  To initiate the review, the Claimant,
                  within 60 days after receiving the Plan Administrator’s notice of denial,
                  must file with the Plan Administrator a written request for
                  review.

              

      

      

      
        	
                 

              	
                7.2.2

              	
                Additional
                  Submissions – Information Access.  The Claimant shall then
                  have the opportunity to submit written comments, documents, records
                  and
                  other information relating to the claim.  The Plan Administrator
                  shall also provide the Claimant, upon request and free of charge,
                  reasonable access to, and copies of, all documents, records and
                  other
                  information relevant (as defined in applicable ERISA regulations)
                  to the
                  Claimant’s claim for benefits.

              

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      
        	
                 

              	
                7.2.3

              	
                Considerations
                  on Review.  In considering the review, the Plan
                  Administrator shall take into account all materials and information
                  the
                  Claimant submits relating to the claim, without regard to whether
                  such
                  information was submitted or considered in the initial benefit
                  determination.

              

      

      

      
        	
                 

              	
                7.2.4

              	
                Timing
                  of Plan Administrator Response.  The Plan Administrator
                  shall respond in writing to such Claimant within 60 days after
                  receiving
                  the request for review.  If the Plan Administrator determines
                  that special circumstances require additional time for processing
                  the
                  claim, the Plan Administrator can extend the response period by
                  an
                  additional 60 days by notifying the Claimant in writing, prior
                  to the end
                  of the initial 60-day period, that an additional period is
                  required.  The notice of extension must set forth the special
                  circumstances and the date by which the Plan Administrator expects
                  to
                  render its decision.

              

      

      

      
        	
                 

              	
                7.2.5

              	
                Notice
                  of Decision.  The Plan Administrator shall notify the
                  Claimant in writing of its decision on review.  The Plan
                  Administrator shall write the notification in a manner calculated
                  to be
                  understood by the Claimant.  The notification shall set
                  forth:

              

      

      

      
        	
                 

              	
                (a)

              	
                The
                  specific reasons for the denial;

              

      

      
        	
                 

              	
                (b)

              	
                A
                  reference to the specific provisions of the Agreement on which
                  the denial
                  is based;

              

      

      
        	
                 

              	
                (c)

              	
                A
                  statement that the Claimant is entitled to receive, upon request
                  and free
                  of charge, reasonable access to, and copies of, all documents,
                  records and
                  other information relevant (as defined in applicable ERISA regulations)
                  to
                  the Claimant’s claim for benefits;
                  and

              

      

      
        	
                 

              	
                (d)

              	
                A
                  statement of the Claimant’s right to bring a civil action under ERISA
                  Section 502(a).

              

      

      

      Article
        8

      Amendments
        and Termination

      

      
        	
                8.1

              	
                Amendments.  This
                  Agreement may be amended only by a written agreement signed by
                  the Bank
                  and the Executive.  However, the Bank may unilaterally amend
                  this Agreement to conform with written directives to the Bank from
                  its
                  auditors or banking regulators or to comply with legislative or
                  tax law,
                  including without limitation Section 409A of the Code and any and
                  all
                  regulations and guidance promulgated
                  thereunder.

              

      

      

      
        	
                8.2

              	
                Plan
                  Termination Generally.  The Bank may unilaterally terminate
                  this Agreement at any time.  The benefit shall be the amount the
                  Bank has accrued with respect to the Bank’s obligations hereunder as of
                  the date the Agreement is terminated.  Except as provided in
                  Section 8.3, the termination of this Agreement shall not cause
                  a
                  distribution of benefits under this Agreement.  Rather, upon
                  such termination benefit distributions will be made at the earliest
                  distribution event permitted under Article 2 or Article
                  3.

              

      

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      
        	
                8.3

              	
                Plan
                  Terminations Under Section 409A.  Notwithstanding anything
                  to the contrary in Section 8.2, if the Bank terminates this Agreement
                  in
                  the following circumstances:

              

      

      

      
        	
                 

              	
                (a)

              	
                Within
                  thirty (30) days before or twelve (12) months after a change in
                  the
                  ownership or effective control of the Bank or of the Corporation,
                  or in
                  the ownership of a substantial portion of the assets of the Bank
                  or of the
                  Corporation as described in Section 409A(2)(A)(v) of the Code,
                  provided
                  that termination of this Agreement was effected through an irrevocable
                  action taken by the Bank and provided further that all distributions
                  are
                  made no later than twelve (12) months following such termination
                  of the
                  Agreement and that all the Bank's arrangements which are
                  substantially similar to the Agreement are terminated so the Executive
                  and
                  all participants in the similar arrangements are required to receive
                  all amounts of compensation deferred under the terminated arrangements
                  within twelve (12) months of the termination of the
                  arrangements;

              

      

       

      
        	
                 

              	
                (b)

              	
                Upon
                  the Bank’s dissolution or with the approval of a bankruptcy court provided
                  that the amounts deferred under the Agreement are included in the
                  Executive's gross income in the latest of (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 practical;
                  or

              

      

       

      
        	
                 

              	
                (c)

              	
                Upon
                  the Bank’s termination of this and all other non-account balance plans (as
                  referenced in Section 409A of the Code or the regulations thereunder),
                  provided that all distributions are made no earlier than twelve
                  (12)
                  months and no later than twenty-four (24) months following such
                  termination, provided further that the termination of this Agreement
                  does
                  not occur proximate to the downturn in the financial health of
                  the Bank
                  and provided further that the Bank does not adopt any new non-account
                  balance plans for a minimum of three (3) years following the date
                  of such
                  termination;

              

      

       

      then
        the
        Bank may distribute the amount the Bank has accrued with respect to the Bank’s
        obligations hereunder, determined as of the date of the termination of the
        Agreement, to the Executive in a lump sum subject to the above
        terms.

      

      Article
        9

      Miscellaneous

      

      
        	
                9.1

              	
                Binding
                  Effect.  This Agreement shall bind the Executive and the
                  Bank, and their beneficiaries, survivors, executors, administrators
                  and
                  transferees.

              

      

      

      
        	
                9.2

              	
                No
                  Guarantee of Employment.  This Agreement is not a contract
                  for employment.  It does not give the Executive the right to
                  remain as an employee of the Bank, nor does it interfere with the
                  Bank's
                  right to discharge the Executive.  It also does not require
                  the

              

      

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      Executive
        to remain an employee nor interfere with the Executive's right to terminate
        employment at any time.

      

      

      
        	
                9.3

              	
                Non-Transferability.  Benefits
                  under this Agreement cannot be sold, transferred, assigned, pledged,
                  attached or encumbered in any
                  manner.

              

      

      

      
        	
                9.4

              	
                Tax
                  Withholding and Reporting.  The Bank shall withhold any
                  taxes that are required to be withheld from the benefits provided
                  under
                  this Agreement.  The Executive acknowledges that the Bank’s sole
                  liability regarding taxes is to forward any amounts withheld to
                  the
                  appropriate taxing authority(ies).  Further, the Bank shall
                  satisfy all applicable reporting requirements, including those
                  under
                  Section 409A of the Code and regulations
                  thereunder.

              

      

      

      
        	
                9.5

              	
                Applicable
                  Law.  The Agreement and all rights hereunder shall be
                  governed by the laws of the State of Indiana, except to the extent
                  preempted by the laws of the United States of
                  America.

              

      

      

      
        	
                9.6

              	
                Unfunded
                  Arrangement.  The Executive and the Beneficiary are general
                  unsecured creditors of the Bank for the distribution of benefits
                  under
                  this Agreement.  The benefits represent the mere promise by the
                  Bank to distribute such benefits.  The rights to benefits are
                  not subject in any manner to anticipation, alienation, sale, transfer,
                  assignment, pledge, encumbrance, attachment, or garnishment by
                  creditors.  Any insurance on the Executive's life or other
                  informal funding asset is a general asset of the Bank to which
                  the
                  Executive and Beneficiary have no preferred or secured
                  claim.

              

      

      

      
        	
                9.7

              	
                Reorganization. The
                  Bank shall not merge or consolidate into or with another bank,
                  or
                  reorganize, or sell substantially all of its assets to another
                  bank, firm,
                  or person unless such succeeding or continuing bank, firm, or person
                  agrees to assume and discharge the obligations of the Bank under
                  this
                  Agreement.  Upon the occurrence of such event, the term “Bank”
                  as used in this Agreement shall be deemed to refer to the successor
                  or
                  survivor bank.

              

      

      

      
        	
                9.8

              	
                Entire
                  Agreement. This Agreement constitutes the entire
                  agreement between the Bank and the Executive as to the subject
                  matter
                  hereof.  No rights are granted to the Executive by virtue of
                  this Agreement other than those specifically set forth
                  herein.

              

      

      

      
        	
                9.9

              	
                Interpretation.  Wherever
                  the fulfillment of the intent and purpose of this Agreement requires,
                  and
                  the context will permit, the use of the masculine gender includes
                  the
                  feminine and use of the singular includes the
                  plural.

              

      

      

      
        	
                9.10

              	
                Alternative
                  Action.  In the event it shall become impossible for the
                  Bank or the Plan Administrator to perform any act required by this
                  Agreement due to regulatory or other constraints, the Bank or Plan
                  Administrator may in its discretion perform such alternative act
                  as most
                  nearly carries out the intent and purpose of this Agreement and
                  is in the
                  best

              

      

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      interests
        of the Bank, provided that such alternative acts do not subject the Executive
        to
        tax under Section 409A of the Code.

      

      
        	
                9.11

              	
                Headings.  Article
                  and section headings are for convenient reference only and shall
                  not
                  control or affect the meaning or construction of any of its
                  provisions.

              

      

      

      
        	
                9.12

              	
                Validity.  In
                  case any provision of this Agreement shall be illegal or invalid
                  for any
                  reason, said illegality or invalidity shall not affect the remaining
                  parts
                  hereof, but this Agreement shall be construed and enforced as if
                  such
                  illegal and invalid provision has never been inserted
                  herein.

              

      

      

      
        	
                9.13

              	
                Notice.  Any
                  notice or filing required or permitted to be given to the Bank
                  or Plan
                  Administrator under this Agreement shall be sufficient if in writing
                  and
                  hand-delivered, or sent by registered or certified mail, to the
                  address
                  below:

              

      

       

      
        	 	
                HomeFederal
                  Bank

              	 
	 	
                Attention:
                  CEO

              	 
	 	
                501
                  Washington Street

              	 
	 	
                Columbus,
                  IN  47201

              	 

      

       

      Such
        notice shall be deemed given as of the date of delivery or, if delivery is
        made
        by mail, as of the date shown on the postmark on the receipt for registration
        or
        certification.

      

      Any
        notice or filing required or permitted to be given to the Executive under
        this
        Agreement shall be sufficient if in writing and hand-delivered, or sent by
        mail,
        to the last known address of the Executive.

      

      
        	
                9.14

              	
                Compliance
                  with Section 409A.  This Agreement shall at all times be
                  operated and interpreted consistent with the requirements of Section
                  409A
                  of the Code and any and all regulations thereunder, including such
                  regulations as may be promulgated after the Effective Date of this
                  Agreement.

              

      

      

      

      IN
        WITNESS WHEREOF, the Executive and a duly authorized representative of the
        Bank
        have signed this Agreement.

      

      
        	
                Executive:

              	 	
                HOMEFEDERAL
                  BANK

              
	 	 	 	 
	 	 	 	 
	/s/
                S. Elaine Pollert	 	
                By

              	/s/
                Melissa A. McGill
	
                S.
                  Elaine Pollert

              	 	
                Title

              	SVP
                / Controller

      

      

      

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

          
                  

            HOMEFEDERAL
              BANK      
Supplemental
            Executive Retirement
            Agreement         

            BENEFICIARY
              DESIGNATION
              FORM           

             

             
              
                

              

            

          

        

      

      {  }           New
        Designation

      {  }           Change
        in Designation

      

      I,
        __________________________, designate the following as Beneficiary under
        the
        Agreement:

      

      
        	
                Primary:

                 
                  ___________________________________________________________

                 

                 
                  ___________________________________________________________

                 

              	
                 

                _____%

                 

                _____%

                 

              
	
                Contingent:

                 
                  ___________________________________________________________

                 

                 
                  ___________________________________________________________

                 

              	
                 

                _____%

                 

                _____%

                 

              

      

      
      

       

      
        Notes:

      

      
        	
                 

              	
                 

              

      

      
        	
                 

              	
                ·

              	
                Please
                  PRINT CLEARLY or TYPE the names of the
                  beneficiaries.

              

      

      
        	
                 

              	
                ·

              	
                To
                  name a trust as Beneficiary, please provide the name of the trustee(s)
                  and
                  the exact name and date of the
                  trust agreement.

              

      

      
        	
                 

              	
                ·

              	
                To
                  name your estate as Beneficiary, please write “Estate of
                  [your
                  name]”.

              

      

      
        	
                 

              	
                ·

              	
                Be
                  aware that none of the contingent beneficiaries will receive anything
                  unless ALL of the primary beneficiaries predecease
                  you.

              

      

      

      I
        understand that I may change these beneficiary designations by delivering
        a new
        written designation to the Plan Administrator, which shall be effective only
        upon receipt and acknowledgment by the Plan Administrator prior to my
        death.  I further understand that the designations will be
        automatically revoked if the Beneficiary predeceases me, or, if I have named
        my
        spouse as Beneficiary and our marriage is subsequently dissolved.

      

      Name:              _______________________________

      

      Signature:      _______________________________                        Date:    __________

      

      

      Received
        by the Plan Administrator this ________ day of ___________________,
        2___

      

      By:            _________________________________

      

      Title:         _________________________________

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