EXHIBIT 10.1
AMENDED AND RESTATED
MANAGEMENT SERVICES AND ALLOCATION OF EXPENSES AGREEMENT
THIS AMENDED AND RESTATED MANAGEMENT SERVICES AND ALLOCATION OF
EXPENSES AGREEMENT, made as of this 9th day of May, 2001, by and between
InvestorsBank, a Wisconsin banking organization, located at W239 N1700 Busse
Road, Waukesha, Wisconsin ("Bank"), and The Middleton Doll Company and Bando
McGlocklin Small Business Lending Corporation (such corporations collectively
referred to herein as "Bando"), a Wisconsin corporation, located at W239 N1700
Busse Road, Waukesha, Wisconsin 53188-1160.
WHEREAS, the Bank and Bando have hereunto established a contractual
relationship to permit employees of the Bank to manage the loans (i) made by
Bando that are either on Bando's balance sheet or sold by Bando but for which
Bando retains servicing obligations; and (ii) originated by the Bank or other
financial institutions which are purchased by Bando (in whole or in part)
(collectively, the "Bando Loans"), to permit Bank employees to provide
accounting services to Bando, to provide leased property services to Bando and
to share certain overhead expenses as between the Bank and Bando, all in
accordance with the terms and conditions of this Agreement; and
WHEREAS, Bando and the Bank each possess similar loan assets requiring
loan administration services and expertise; and
WHEREAS, the Bank employs persons with the necessary qualifications and
expertise to manage and provide loan administration services to the Bando Loans,
to provide accounting services to Bando and to provide leased property services;
and
WHEREAS, it is in the best interest of the Bank and Bando to share
certain overhead expenses in order to maximize the savings to the Bank and
Bando; and
WHEREAS, the Bank and Bando are parties to a certain "Management
Services and Allocation of Expenses Agreement," dated as of September 2, 1997,
as amended by letters dated April 2, 1998 and May 18, 1998 and pursuant to an
oral agreement (effective as of January 1, 1998) approved by the Board of
Directors of Bando on May 13, 1999 (the Management Services and Allocation of
Expenses Agreement, the two letters and the oral agreement being collectively
referred to herein as the "Agreement"); and
WHEREAS, the Bank and Bando desire to amend and restate the Agreement
so that the Agreement, as amended and restated, includes the terms of the
original Management Services and Allocation of Expenses Agreement, the two
letters and the oral agreement.
NOW, THEREFORE, for and in consideration of the premises and mutual
covenants contained in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
1. Loan Management Services.
(a) The Bank shall service and administer the Bando Loans and shall
have full power and authority, acting alone, to do any and all things in
connection with such servicing and administration which the Bank may deem
necessary or desirable including, but not limited to, the following:
The Bank may waive, modify or vary any term of any Bando Loan or
consent to the postponement of strict compliance with any such term or in any
manner grant indulgence to any obligor if, in the Bank's determination, such
waiver, modification, postponement or indulgence is not materially adverse to
the interests of Bando; provided, however, that, unless the obligor is in
default with respect to the Bando Loan, or such default is, in the judgment of
the Bank, imminent, the Bank may not permit any modification with respect to any
Bando Loan that would change the loan interest rate, defer or forgive the
payment of any principal or interest (unless in connection with the liquidation
of the related Bando Loan), or extend the final maturity date on such Bando
Loan. All out-of-pocket costs incurred by the Bank, including but not limited
to, the cost of appraisals, title insurance and attorneys' fees shall be added
to the amount owning under the related Bando Loan. Without limiting the
generality of the foregoing, the Bank shall continue and is hereby authorized
and empowered to execute and deliver on behalf of Bando all instruments of
satisfaction or cancellation, or of partial or full release, discharge and all
other comparable instruments, with respect to the Bando Loans and with respect
to any mortgaged properties or other collateral. If reasonably required by the
Bank, Bando shall furnish the Bank with any powers of attorney and other
documents necessary or appropriate to enable the Bank to carry out its servicing
and administrative duties under this Agreement.
(b) In consideration for the Bank's loan management services to Bando
under this Agreement, the Bank shall charge and Bando shall pay on a monthly
basis a fee equal to one-twelfth of twenty-five (25) basis points multiplied by
the amount of Bando Loans outstanding at the end of the preceding month plus all
of the Bank's out-of-pocket expenses described in Section 1(a).
(c) As agent of Bando, Bank may originate loans for the benefit of
Bando to Bando customers and shall be entitled to a loan origination and
processing fee of $2,500 for each loan so originated and processed. For purposes
of this Section 1(c), "originate loans to Bando customers" means refinancing
loans, renewing loans and making new loans to then existing Bando customers.
(d) From time to time, the Bank may sell, and Bando may purchase,
participations in loans made by the Bank. Any such participations shall be made
proportionately with the face amount of such loans and shall bear the same
interest rate. No loan origination fees shall be paid with respect to such
loans.
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2. Leased Property Servicing.
(a) In general, Bank shall be Bando's agent in all matters relating to
the lease arrangements between Bando, as property owner, and lessees (the
properties subject to such lease arrangements being called the "Leased
Properties"), including the collection of rents and insuring that real estates
taxes are duly paid and that insurance coverages are maintained. Bank, as
Bando's agent, shall deal directly with lessees and others in all matters
pertaining to such leases. In addition, Bank shall use its best efforts to
obtain properties to be owned by Bando and leased to corporations or others on a
triple net lease basis. In furtherance thereof, Bank shall be responsible for
obtaining properties, securing lessees, preparing all necessary papers and
documents and tending to all closing activities.
(b) On all properties acquired by Bando from Bando McGlocklin Real
Estate Investment Corporation, Bando shall pay the Bank a monthly leased
property servicing fee equal to one-twelfth (1/12) of twenty-five (25) basis
points multiplied by Bando's total cost of all such properties, as shown on its
books and records.
(c) On all properties owned by Bando other than those identified in
Section 2(b) above, Bando shall pay Bank a monthly leased property servicing fee
equal to six percent (6%) of the rental fees received on such properties each
month.
3. Accounting Services. The Bank shall provide accounting services to
Bando in accordance with the terms of this Agreement, which services shall
include, but not be limited to, the following:
(a) Preparation of internal management reports
(b) Preparation of external reports to shareholders and any applicable
regulatory agencies.
The Bank shall maintain a record of the actual time spend by its employees in
providing such accounting services and shall charge and Bando shall pay on a
monthly basis for the actual costs of providing such services. The actual cost
shall be the employee's hourly rate, plus a pro rata share of the cost of
bonuses and other benefits and perquisites of employment made available to such
employee(s).
4. Audits. Bando shall have the authority to audit the activities and
services provided by the Bank on reasonable notice to the Bank and at Bando's
expense during the term of this Agreement.
5. Standard of Care. The Bank shall perform its responsibilities under
this Agreement in accordance with its usual practices and shall employ or cause
to be employed procedures (including collection, foreclosure and foreclosed
property management procedures) and shall exercise the same degree of care to
protect Bando's interest in the Bando Loans and the Leased Properties managed by
the Bank as it does its own assets. So long as the Bank exercises such care in
the servicing and management of the Bando Loans and the Leased
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Properties, it shall not be under any liability to Bando with respect to
anything it may do or refrain from doing in the exercise of its judgment or
which may seem to the Bank to be necessary or desirable in the servicing and
management of the Bando Loans and the Leased Properties, except for its willful
misconduct.
6. Representations. Subject to Section 5 hereof, the Bank has not made
and does not make any representations or warranties, express or implied, with
respect to, and the Bank does not assume and has no responsibility or liability
for, the collectibilty, enforceability or the validity of any of the Bando
Loans, the documents evidencing such loans, or the financial condition of any
borrower or any obligor on the loans or collateral securing the loans, or other
information furnished by the Bank to Bando nor does the Bank assume any
responsibility for the payment of rents or other payments required to be made by
any lessee of the Leased Properties.
7. Overhead Expenses. The Bank and Bando shall share on an equal 50/50
basis, their overhead expenses. These expenses shall include, but not be limited
to, expenses for telephones, office and computer expense, receptionist services,
building maintenance and other miscellaneous expenses. The Bank shall pay these
expenses and shall charge and Bando shall pay for Bando's one-half of the
expenses on a monthly basis.
8. Noncompetition. Bando agrees that, except as specifically approved
in writing by the Bank, Bando shall not originate any loans during the term of
this Agreement and any renewal thereof, except that Bando, through the Bank, may
make loans to then existing Bando customers, whether by refinancing outstanding
loans, increasing outstanding amounts or making new loans. Notwithstanding the
foregoing, Bando may, at its option, purchase loan participations (100% or less)
from any other lending institution, including, but not limited to, the Bank.
9. Term. The term of this Agreement shall continue until May 1, 2002,
at which time this Agreement shall be automatically renewed for successive one
(1) year terms unless prior to the original termination date or any subsequent
renewal date either party provides the other party with written notice at least
sixty (60) days in advance of the termination date of its intent that this
Agreement not be automatically renewed upon the occurrence of the next scheduled
termination date. This Agreement may also be terminated at any time by mutual
written consent of the Bank and Bando or by either party if the other party
fails to perform as required by this Agreement. Upon termination, Bando or its
designee shall assume all of the rights and obligations of the Bank. The Bank
shall, upon request of Bando but at the expense of the Bank, deliver to Bando
all documents and records relating to the Bando Loans and the Leased Properties
and an accounting of amounts collected and held by the Bank and otherwise use
its best efforts to effect the orderly and efficient transfer of servicing
rights and obligations to the assuming party.
10. Confidentiality. The Bank agrees that it shall not disclose to any
third party any information concerning the customers, trade secrets, methods,
processes or procedures or any other confidential, financial or business
information of Bando of which it
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learns during the course of its performance under this Agreement, without the
prior consent of Bando.
11. Books and Records. All books and records maintained by or for Bando
shall be the property of Bando and shall be returned or provided to Bando by the
Bank immediately upon Bando's request.
12. Miscellaneous.
(a) This Agreement sets forth the entire understanding of the parties
as to its subject matter and may not be modified except in writing executed by
both parties.
(b) If any provision of this Agreement is held invalid or otherwise
unenforceable, the validity or enforceability of the remaining provisions shall
not be impaired thereby.
(c) This Agreement shall be governed by and construed under the laws of
the State of Wisconsin.
INVESTORSBANK
By: /s/ George Schonath
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George R. Schonath, Its President
THE MIDDLETON DOLL COMPANY
By: /s/ George Schonath
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George R. Schonath, Its President
BANDO McGLOCKLIN SMALL
BUSINESS LENDING CORPORATION
By: /s/ George Schonath
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George R. Schonath, Its President
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