Amended and Restated Retirement and Death Benefit Agreement between First Business Bank and Corey Chambas (January 1, 2005)

    (a)     “Agreement” means this document.

    (b)     “Beneficiary” means the persons or entities designated by the Executive pursuant to Section 10.2 herein.

    (c)     “Board” means the Board of Directors of the Company or any committee formed by or appointed by the Board to administer this Agreement.

    (d)     “Cause” shall be determined by the Board, in the exercise of good faith and reasonable judgment, and shall mean any of the following:

    (1)     The willful, intentional, and continued failure by the Executive to substantially perform the Executive’s duties to the best of the Executive’s ability after a written demand for performance is delivered by the Board to the Executive that identifies the failure to perform such duties if such failure is not remedied within ninety (90) calendar days after receipt of the written demand by the Executive.

    (2)     The occurrence of the Executive’s conviction for committing an act of fraud, embezzlement, theft, or other act constituting a felony substantially related to the circumstances of the Executive’s duties; or material breach by the Executive of the banking laws of Wisconsin or the United States or any regulation issued by a state or federal regulatory authority having jurisdiction over the banking affairs of the Company, or any of its subsidiary, parent, or affiliated organizations; or an act which disqualifies the Executive from serving as an officer or director of a bank under Wisconsin or Federal banking laws.

    (e)     “Change in Control”

    (1)     A “Change in Control” shall be deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied including, but not limited to, signing of documents by all parties and approval by all regulatory agencies, if required:

    (i)     Any person (as defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”) and used in Sections 13(d) and 14(d) thereof), including a group (as defined in Section 13(d)), becomes the Beneficial Owner (as such term is defined pursuant to rules promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing at least fifty percent (50%) of the combined voting power of the Company’s then outstanding securities;

    (ii)     During any twelve (12) consecutive months, individuals who, at the beginning of the twelve- (12-) month period constitute the Board, cease for any reason to constitute a majority of the Board; provided, however, a “Change in Control” shall not occur pursuant to this provision, if a new director is approved by a vote of at least a majority of the directors serving on the Board and these directors either were directors at the beginning of the twelve- (12-) month period or whose election or nomination for election was so approved; or

    (iii)     The shareholders of the Company approve: (A) a plan of complete liquidation of the Company; or (B) an agreement for the sale or disposition of all or substantially all the Company’s assets; or (C) a merger, consolidation, or reorganization of the Company with or involving any other corporation, other than a merger, consolidation, or reorganization that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity), at least fifty percent (50%) of the combined voting power of the voting securities of the Company (or such surviving entity) outstanding immediately after or within one (1) year following such merger, consolidation, or reorganization.

    (2)     However, notwithstanding the foregoing, in no event shall a Change in Control be deemed to have occurred, with respect to the Executive, if the Executive is part of a purchasing group which consummates the Change-in-Control transaction. The Executive shall be deemed “part of a purchasing group” for purposes of the preceding sentence if the Executive is an equity participant in the purchasing company or group (except for passive ownership of less than three (3%) percent of the stock of the purchasing company or ownership of equity participation in the purchasing company or group which is otherwise not significant, as determined prior to the Change in Control by a majority of the non-employee continuing members of the Board).

    (3)     For purposes of the definition of “Change in Control” under this Section 1.1(e), “Company” means First Business Financial Services, Inc. or First Business Bank.

    (f)     “Code” means the Internal Revenue Code of 1986, as amended from time to time.

    (g)     “Company” means First Business Bank, a Wisconsin corporation (including any and all of its subsidiaries), or any successor thereto as provided in Article 9 herein, except as otherwise provided in Section 1.1(e)(3). For purposes of the Executive’s separation from service (as defined in Code Section 409A and any regulations thereunder) with the Company, “Company” includes First Business Financial Services, Inc. and any other entity related to the Company (within the meaning of Code Section 414(b), (c) or (m)).

    (h)     “Death Benefit” means the benefit payable to the Beneficiary pursuant to Section 3.1.

    (i)     “Early Retirement Benefit” means the retirement benefit payable to the Executive pursuant to Section 2.2.

    (j)     “Effective Date” means the date written, January 1, 2005.

    (k)     “Executive” means Corey Chambas, who is presently the President and Chief Executive Officer of the Company.

    (l)     “Normal Retirement Age” means the first day of the month following the month in which the Executive reaches age sixty-five (65).

    (m)     “Normal Retirement Benefit” means the retirement benefit payable to the Executive pursuant to Section 2.1.

    (n)     “Parachute Payment” means a “parachute payment” as defined in Section 280G of the Internal Revenue Code of 1986, as amended, and any regulations thereunder.

    (o)     “Retirement Date” means the effective date of the retirement of the Executive pursuant to Article 2.

    (p)     “Salary” means, with respect to any calendar year in which the Executive’s separation from service with the Company occurs, the aggregate of the Executive’s base salary for the year and the highest of the following: (i) the amount of his target bonus for the year, (ii) the average of the amounts his actual bonuses, if any, for the two (2) immediately preceding years, or (iii) the average of the amounts of his actual bonuses, if any, for the three (3) immediately preceding years). The Salary shall be calculated based on the date of actual separation from service, even if the Executive is deemed to remain employed after such separation under Article 4.

    (q)     “Specified Employee” means a key employee (as defined in Code Section 416(i) without regard to paragraph (5) thereof) of a corporation any stock in which is publicly traded on an established securities market or otherwise.

    (r)     “Total Disability” means that the Executive:

    (1)     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

    (2)     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 Company.

    (a)     The Executive may retire at any time after the Executive has been employed by the Company for twenty-three (23) consecutive years (“Early Retirement”). The Executive’s date of initial employment with the Company is December 1, 1993, and, therefore, if there is no interruption in consecutive years of employment, the Executive may retire at any time after December 1, 2016. Upon the Executive’s separation from service with the Company due to Early Retirement, the Company shall become obligated to pay to the Executive a retirement benefit equal to sixty percent (60%) of the Executive’s Salary, multiplied by a vesting percentage described below, payable for ten (10) years, beginning on the fifteenth (15^th) day following the Retirement Date and on the next nine (9) anniversaries of the first payment. In the event of the Executive’s death before the total amount due under this Section has been paid, the Company shall pay to the Beneficiary, or, if none, the Executive’s estate, the remaining annual payments on the schedule established at the Executive’s Early Retirement.

    (b)     When the Executive has completed twenty-three (23) years of consecutive employment with the Company, the vesting percentage shall be twenty-three thirty-fourths (23/34), or sixty-seven and 65/100 percent (.6765). The numerator twenty–three (23) used to determine the vesting percentage shall increase by one (1) for each subsequent year of consecutive service with the Company above twenty-three (23) through thirty-four (34). Therefore, for example, if the Executive’s separation from service occurs after twenty-seven (27) years of consecutive service the vesting percentage shall be twenty-seven thirty-fourths (27/34), or seventy-nine and 41/100 percent (.7941). For another example, if the Executive’s separation from service occurs after thirty-four (34) years of service, the vesting percentage shall be thirty-four thirty-fourths (34/34) or one hundred percent (100%), and the Executive shall be entitled to the Normal Retirement Benefit, rather than an Early Retirement Benefit.

    (c)     Notwithstanding the foregoing, unless the Executive ceases to be a Specified Employee before his Early Retirement, the first actual payment under this Section 2.2, whether to the Executive or the Beneficiary, as applicable, shall be delayed six (6) months beyond the date of his Early Retirement.

    (a)     Term. The period during which the Executive will provide the Consulting Services to the Company shall commence on the date of his separation from service and shall continue through the later of (1) date of the last payment of his Early or Normal Retirement Benefit, as applicable, or (2) the second (2^nd) anniversary of his separation from service (the “Term”).

    (b)     Services. The Executive shall provide the following services (the “Consulting Services”) as reasonably requested from time to time by the Chair of the Board or the President of the Company upon not less than seven (7) days written notice:

    (1)     responding to questions concerning the Company, including, but not limited to, its business, financial condition, customers and prospects; and

    (2)     such other services as may be mutually agreed upon by the Executive and the Chair of the Board or the President of the Company from time to time.

    (c)     Compensation. For and in consideration of his being available to provide Consulting Services hereunder, the Company shall pay the Executive cash in the amount of five thousand and no/100 dollars ($5,000.00) on the date of each payment of his Normal or Early Retirement Benefit, as applicable, or, if he is not eligible for his Normal or Early Retirement Benefit, on each anniversary of his separation from service through the end of the Term. The Executive shall be entitled to receive such payments whether or not he is requested to provide Consulting Services.

    (d)     Relationship. In providing any Consulting Services, the Executive shall be acting as an independent contractor and not as an employee, agent or representative of the Company. During the Term, the Executive shall disclose that he is an independent contractor of the Company and shall not represent to any third party that he is an employee, agent or representative of the Company. As an independent contractor, the Executive shall have no authority, express or implied, to commit or obligate the Company in any manner whatsoever, and nothing contained herein shall be construed or interpreted to create an employment, agency, partnership or joint venture relationship between the Executive and the Company.

    (e)     Benefit Plans. Except as otherwise provided in this Agreement, during the Term the Executive shall not be covered under, eligible to participate in, or otherwise entitled to receive any benefits under, any pension, welfare or fringe benefit plan, if any, offered or provided by the Company to any employee or former employee of the Company.

    (f)     Taxes. The Executive shall be liable for the payment of all taxes on any compensation paid to the Executive under this Section 2.5, and the Company shall not withhold or pay any federal, state or local income, social security, unemployment or workers compensation taxes on such compensation.

    (a)     If the Executive’s separation from service due to Total Disability occurs prior to age fifty-five (55), then, if and when he reaches such age or (after taking Section 4.1 into account) has been employed by the Company for at least twenty-three (23) consecutive years, whichever is later, the Executive shall receive the Early Retirement Benefit under Section 2.2.

    (b)     If the Executive’s separation from service due to Total Disability occurs after he reaches age fifty-five (55) but prior to his Normal Retirement Age, then, as of his separation from service or if and when (after taking Section 4.1 into account) he has been employed by the Company for at least twenty-three (23) consecutive years, whichever is later, the Executive shall receive the Early Retirement Benefit described in Section 2.2.

    (c)     If the Executive’s separation from service due to Total Disability occurs after he reaches Normal Retirement Age, the Executive shall receive the Normal Retirement Benefit described in Section 2.1.

    (a)     Severance Benefits. If the greater amount is two (2) times the Executive’s Salary, then payment shall be made on the fifteenth (15^th) day immediately following the date of the Executive’s separation from service. In the event of the Executive’s death before such payment date, then payment shall be made by the Company shall pay to the Beneficiary, or, if none, the Executive’s estate.

    (b)     Retirement Benefit. If the greater amount is defined in Article 2 of this Agreement, then payment shall be made according to the terms stated in Article 2 and the Executive shall serve as the consultant to the Company in accordance with Section 2.5. In the event of the Executive’s death before the total amount due under this Section 5.2(b) has been paid, the Company shall pay to the Beneficiary, or, if none, the Executive’s estate, the remaining annual payments on the schedule established at the Executive’s employment termination date.

    (a)     Involuntary Termination of Employment. In the event of a Change in Control followed by the Executive’s separation from service with the Company due to an involuntary termination of his employment without Cause within two (2) years of the Change in Control, the Executive shall be entitled to a cash payment of an amount equal to the fair value of the Executive’s unvested stock options issued by the Company or by First Business Financial Services, Inc. calculated as of the date of the Executive’s termination from employment, plus such additional amount as will, when added to any Parachute Payment to the Executive contingent upon the Change in Control, equal two and 99/100 (2.99) times the Executive’s Salary. Payment shall be made on the fifteenth (15^th) day immediately following the date of the Executive’s separation from service.

    (b)     Involuntary Reassignment or Salary Reduction. In the event of a Change in Control followed by:

    (1)     an involuntary assignment of the Executive to a position of lesser responsibility than that which he held at the time of the Change in Control or

    (2)     an involuntary reduction of more than ten percent (10%) in the amount of the Executive’s Salary as in effect immediately prior to the Change in Control,

    (c)    Involuntary Relocation. In the event of a Change in Control followed by an involuntary assignment of the Executive to a position not located within Milwaukee, Ozaukee, Waukesha, or Dane counties within two (2) years of the Change in Control, the Executive shall be entitled, if he incurs a separation from service with the Company due to his voluntary termination of employment within three (3) months after the involuntary assignment, to a cash payment of an amount equal to the fair value of the Executive’s unvested stock options issued by the Company or by First Business Financial Services, Inc. calculated as of the date of the Executive’s separation from service, plus such additional amount as will, when added to any Parachute Payment to the Executive contingent upon the Change in Control, equal two and 99/100 (2.99) times the Executive’s Salary. Payment shall be made on the fifteenth (15^th) day immediately following the date of the Executive’s separation from service.

    (d)     Voluntary Termination. In the event of a Change in Control followed by the Executive’s separation from service with the Company due to his voluntary termination of employment within three (3) months of the Change in Control, the Executive shall be entitled to a payment of an amount equal to two (2) times his Salary. Payment shall be made in four (4) installments: the first installment six (6) months after the Executive’s separation from service, the second installment twelve (12) months after separation, the third installment eighteen (18) months after separation, and the fourth installment twenty four (24) months after separation.

    (e)     Death. In the event of the Executive’s death before the total amount due under this Section 6.1 has been paid, the Company shall pay to the Beneficiary, or, if none, the Executive’s estate, the remaining payments in accordance with the applicable schedule established under this Section 6.1.

    (f)     Maximum Benefit. Notwithstanding any provision in this Agreement to the contrary, the benefit under this Article 6 will not exceed two and 99/100 (2.99) times the Executive’s “base amount” (as defined in Code Section 280G and the underlying regulations), no matter what the value of the Executive’s unvested stock options issued by the Company or by First Business Financial Services, Inc.

    (g)    Retirement Benefit. Notwithstanding any provision in this Article 6 to the contrary, if at any time after a Change in Control the Executive is otherwise eligible for an Early or Normal Retirement Benefit under Article 2, then he may elect to retire and to receive the Early or Normal Retirement Benefit, as applicable, in lieu of any benefit payable upon his separation from service with the Company due to a voluntary or involuntary termination of employment pursuant to this Article 6.

    (h)    Delayed Payment. Notwithstanding anything in this Article 6 to the contrary, unless the Executive ceases to be a Specified Employee before his separation from service under any of the circumstances described in this Article 6, the first actual payment under this Article 6 to the Executive or the Beneficiary, as applicable, shall be delayed six (6) months beyond the date of his separation from service.

    (a)     Executive. Any applicable obligations of the Executive under Article 7 shall survive the expiration of this Agreement.

    (b)     Company. The expiration of this Agreement shall in no way relieve the Company of its obligations under this Agreement, until all obligations of the Company hereunder have been fulfilled, and until all benefits required hereunder have been paid to the Executive.