EXHIBIT 10.4
[Confidential portions of this Exhibit have been omitted and filed separately
with the Commission. Omitted terms are indicated by ***.]
ADDENDUM TO DATA PROCESSING SERVICES AGREEMENT
THIS ADDENDUM,, to the Data Processing Services Agreement (the
"Agreement") dated May 8, 1992 is made as of this 30th day of May 1995, by and
between the undersigned parties, does hereby alter, amend, and modify the
Agreement and supersedes and takes precedence over any conflicting provisions
contained in the Agreement.
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of
which are hereby acknowledged, the undersigned parties agree as follows
Section 2 (d) of the Agreement is deleted in its entirety and is hereby
replaced with the following:
"d. Terms of Payment. Customer shall pay the Minimum Monthly Fee on the
first day of the month in which the Services are to be performed. Any other
amounts due hereunder shall be paid within thirty (30) days of invoice, unless
otherwise provided herein. To effect the payment, Customer hereby authorizes M&I
to initiate debit entries from and, if necessary, initiate credit entries and
adjustments to Customer's account at the depository designated in the ACH
Authorization Agreement. Debit entries for the Minimum Monthly Fee will be made
on the first day of each month for which Services will be rendered under the
Agreement. In the event that a payment day is a nonbusiness day, entries will be
made on the first preceding business day. Customer shall authorize, on the
attached ACH Authorization Agreement, debits from and credits to its account for
payment for Services received under the Agreement. The Customer shall also pay
any collection fees and reasonable attorneys' fees incurred by M&I in collecting
payment of the charges and any other amounts for which Customer is liable under
the terms and conditions of this Agreement."
All terms and conditions set forth in the underlying Agreement shall
remain in full force and effect under this Amendment.
IN WITNESS WHEREOF, the undersigned parties have duly executed this
Addendum in a manner appropriate to each.
M&I DATA SERVICES, A DIVISION OF THE
MARSHALL & ILSLEY CORPORATION
("M&I")
4900 West Brown Deer Road
Brown Deer, WI 53223-0528
By: /s/ Patrick C. Foy
-----------------------------------------
Name: Patrick C. Foy
Title: President, Outsourcing Business Group
MERRILL MERCHANTS BANCSHARES,
INC. ("Customer")
201 Main Street
Bangor, ME 04402
By: /s/ R.C. Williams, Jr.
-----------------------------------------
Name: R.C. Williams, Jr.
Title: SVP Operations
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AUTHORIZATION AGREEMENT
The undersigned ("Customer") hereby authorizes M&I Data Services, a
division of the Marshall & Ilsley Corporation ("M&I") to initiate debit entries
and to initiate, if necessary, credit entries and adjustments for any excess
debit entries or debit entries made in error, to Customer's account indicated
below and the depository named below, to debit and/or credit the same such
account.
This authority is to remain in full force and effect for the period
coinciding with the term (and any renewals thereof) of the Data Processing
Services Agreement made the 8th day of May 1992 and any addenda thereto (the
"Agreement"), pursuant to the terms and conditions specified in the Agreement.
DEPOSITORY NAME: _______________________________________________________
ADDRESS: _______________________________________________________
CITY/STATE/ZIP: _______________________________________________________
TELEPHONE NUMBER: _______________________________________________________
ROUTING TRANSIT NUMBER: _______________________________________________________
ACCOUNT NUMBER: _______________________________________________________
M&I DATA SERVICES, A DIVISION OF THE
MARSHALL & ILSLEY CORPORATION
("M&I")
4900 West Brown Deer Road
Brown Deer, WI 53223-0528
By: /s/ Patrick C. Foy
-----------------------------------------
Name: Patrick C. Foy
Title: President, Outsourcing Business Group
MERRILL MERCHANTS BANCSHARES,
INC. ("Customer")
201 Main Street
- 3 -
Bangor, ME 04402
By: /s/ R.C. Williams, Jr.
-----------------------------------------
Name: R.C. Williams, Jr.
Title: SVP Operations
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ADDENDUM TO DATA PROCESSING SERVICES AGREEMENT
THIS ADDENDUM, to the Data Processing Services Agreement (the
"Agreement") dated May 8, 1992, is made as of this 30th day of June 1992 by and
between the undersigned parties, does hereby alter, amend, and modify the
Agreement and supersedes and takes precedence over any conflicting provisions
contained in the Agreement.
FOR GOOD AND VALUABLE CONSIDERATION,, the receipt and sufficiency of
which are hereby acknowledged, the undersigned parties agree as follows:
The reference to "July 1, 1992" in Section 27(k) of the Agreement is
deleted and replaced with "October 1, 1992."
IN WITNESS WHEREOF, the undersigned parties have duly executed this
Addendum in a manner appropriate to each.
M&I DATA SERVICES, INC. ("M&I")
By: /s/ Michael V. Ruane
-----------------------------------------
Michael V. Ruane, Vice Pres.
MERRILL MERCHANTS BANCSHARES, INC.
("Customer")
By: /s/ Edwin N. Clift
-----------------------------------------
Edwin N. Clift, President & CEO
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DATA PROCESSING SERVICES AGREEMENT
THIS DATA PROCESSING SERVICES AGREEMENT is made as of this 8th day of
May 1992 (the "Agreement") by and between M&I Data Services, Inc., a Wisconsin
corporation ("M&I") and Merrill Merchants Bancshares, Inc., a Maine corporation,
together with its subsidiaries and affiliates (collectively referred to as the
"Customer").
RECITALS
WHEREAS, M&I provides data processing services to customers located
across the country; and
WHEREAS, M&I desires to provide data processing services to Customer,
and Customer desires to have M&I provide it with such services.
NOW, THEREFORE, in consideration of the recitals and for the good and
valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Services. M&I shall provide Customer with the data processing
services requested by Customer utilizing the version of the banking system
software made available from time to time by M&I through the M&I Service Bureau
(the "Services"). A further description of the Services is attached as Exhibit
A, as modified by the User Manuals, copies of which will be provided, or made
available, to Customer. Future affiliates and subsidiaries will be added as
requested by Customer and agreed to by M&I from time to time. Customer agrees to
principally use M&I for Customer's data processing. The Services which will be
provided under this Agreement include, but are not limited to, Deposit
Accounting, Loan Accounting, Financial Control, CIF, PCTeller, ATM, EFT (the
"Core Services"), and others agreed upon. Unless otherwise agreed in writing
between M&I and Customer, and subject to the other provisions of the Agreement,
M&I shall make the On-line Services available to Customer, subject to normal
downtime and maintenance, at times indicated on the M&I On- line Availability
Schedule, as modified from time to time.
2. Fees and Taxes. Customer agrees to pay for the Services received
hereunder as follows:
a. Amount of Fees. Commencing on the Conversion Date (as defined in
Section 3) and on the first day of each month thereafter through the end of the
term of this Agreement, Customer shall pay M&I a minimum monthly fee not less
than $*** per month, (the "Minimum Monthly Fee"). The Minimum Monthly Fee will
be adjusted: (a) as of the date M&I makes effective a price increase; and (b) on
the first day of any month after: (i) the
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* [Confidential portions of this Exhibit have been omitted and filed separately
with the Commission. Omitted terms are indicated by ***.]
Additional Use Fee (as defined below) is greater than *** percent (***%) of the
Minimum Monthly Fee; or (ii) Customer expands the Services used hereunder to
include an additional application. The Minimum Monthly Fee may not be decreased.
Adjustments to the Minimum Monthly Fee shall be based on the Services,
transactions, and volumes used by the Customer during the Adjustment Period (as
defined below), or the period from commencement of services to the date of the
adjustment during the initial three (3) months of the Agreement. The Minimum
Monthly Fee shall not be more than *** percent (***%) of the average monthly
charges during the Adjustment Period. Customer shall also pay M&I an additional
use fee each month where M&I charges for the Services actually used by Customer
during the applicable month are greater than the Minimum Monthly Fee. M&I shall
compute the Customer's actual usage charges based on M&I's then-current standard
published prices, and any amounts due M&I in excess of the Minimum Monthly Fee
shall be paid by Customer (the "Additional Use Fee"). Customer also agrees to
pay all communication costs, telecommunication charges, printline charges and
other output costs, start-up fees, pass-through charges, out-of-pocket expenses,
conversion expenses and fees, workshop fees, training fees, late fees or charges
billed as miscellaneous on Customer's invoice (the "Miscellaneous Fees"). The
M&I standard published prices as of the date of this Agreement are set forth on
the fee schedule attached as Exhibit B.
b. Discount. M&I shall provide Customer with a *** percent (***%)
discount on Services excluding communication costs, telecommunication charges,
printline charges and other output costs, start-up fees, pass-through charges,
out-of-pocket expenses, conversion expenses and fees, workshop fees, training
fees, late fees, or charges billed as Miscellaneous on the Customer's invoice.
The discount shall be in effect for the term of the Agreement.
c. Additional Charges. In addition to the charges described above or
set forth in Exhibit B. Customer agrees to pay for any manufacturers, sales,
use, excise, personal property, or any other tax or charge, or duty or
assessment levied or assessed by any governmental authority upon or as a result
of the execution or performance of any service pursuant to this Agreement or
materials furnished with respect to the Agreement, except those taxes based on
M&I's net income.
d. Terms of Payment. Customer shall pay the Minimum Monthly Fee on
the first day of the month in which the Services are to be performed, and shall
pay the Additional Use Fee and any Miscellaneous Fees within ten (10) days of
the date such amounts are Invoiced to Customer. Any other amounts due hereunder
shall be paid within thirty (30) days of invoice, unless otherwise provided
herein. The Customer shall also pay any collection fees and reasonable
attorney's fees incurred by M&I in collecting payment of the charges and any
other amounts for which Customer is liable under the terms and conditions of
this Agreement.
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* [Confidential portions of this Exhibit have been omitted and filed separately
with the Commission.]
e. Modification of Terms and Pricing. If Customer is in default and
M&I elects to continue to perform the Services, or if the Customer's tangible
capital or reserve requirements computed in accordance with applicable federal
regulations for itself or any of its affiliates receiving Services hereunder are
less than the required regulatory minimums, Customer agrees to pay M&I all
unamortized conversion expenses in advance of M&I performing any additional
Services. In addition, Customer agrees that all charges for Services shall be
computed using M&I's then-current standard published prices, without application
of any credits, other than remote site credits (printline and transaction), paid
in advance as determined by M&I. At M&I's option, such Services shall be
provided on a month-to-month basis.
3. Term.
a. Initial Term. This Agreement shall be effective upon execution by
both parties, and both parties will promptly undertake the conversion activities
necessary to process Customer's data. M&I currently anticipates, subject to
Customer's timely and satisfactory completion of its responsibilities described
in the M&I Conversion Manual and in the Conversion Schedule to be established by
M&I, and agreed to by Customer, that all conversion activities will be completed
on _______________________ (the "Conversion Date"). The term of this
Agreement shall continue for a period of eighty-four (84) months from the
Conversion Date.
b. Renewal Obligations. During any renewal term, or for any Services
provided after the end of the initial term, whether or not the Agreement is
renewed, Customer agrees that the terms of this Agreement shall continue to
apply, except that all charges for Services shall be computed using M&I's
then-current standard published prices, without application of any credits other
than remote site credits (printline and transaction), paid in advance as
determined by M&I. At M&I's option, such Services shall be provided by M&I on a
month-to-month basis.
4. Affiliates. All processing for Customer and Customer's subsidiaries
and affiliates which M&I does shall be included as part of the Services provided
under this Agreement and shall be done in accordance with the terms and
conditions of this Agreement. Customer agrees that it is responsible for
assuring compliance with the Agreement by its affiliates and subsidiaries.
Customer agrees to be responsible for the submission of its affiliates, data to
M&I for processing and for the transmission to Customer's affiliates of such
data processed by and received from M&I. Customer agrees to pay any and all fees
owed under this Agreement for Services hereunder.
5. Confidentiality. Both parties will, to the extent and in accordance
with their policies used to protect their own information of similar Importance,
use their best efforts to refrain from and prevent the use of or disclosure of
any confidential information of the other party, disclosed or obtained by such
party while performing its obligations under this
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Agreement, except when such use or disclosure is for the purpose of providing
the Services. Neither party will have an obligation of confidentiality with
regard to any information insofar as the same: (1) was known to such party prior
to disclosure; (2) is or becomes publicly available other than as a result of a
breach of this Agreement; or (3) is disclosed to such party by a third party not
subject to an obligation of confidentiality. Nor shall the obligation of
confidentiality occur where disclosure is made pursuant to: (1) any law of the
United States or any state thereof; (2) the order of any court or governmental
agency; or (3) the rules and regulations of any governmental agency.
6. Programming. M&I reserves the right to determine the programming
(whether hardware or software) utilized with the equipment used in fulfilling
its duties under this Agreement. All programs (including ideas and know-how and
concepts) developed by M&I are and remain its sole property.
7. Equipment. Customer shall obtain and maintain at its own expense
such data processing and communications equipment as may be necessary or
appropriate to facilitate the proper use and receipt of the Services. Customer
shall pay all installation, monthly, and other charges relating to the
installation and use of communications lines in connection with the Services.
M&I shall not be responsible for the reliability monitoring or continued
availability of the communications lines used by Customer in accessing the
Services.
8. Supplies. Customer shall pay for all supplies used in connection
with the Services. All forms, supplies, or materials used in processing
Customer's items and input data shall meet M&I's specifications.
9. Systems Modification; Amendment of Services. M&I may modify, amend,
enhance, update, or provide the appropriate replacement for any of the Services,
the software used to provide the Services, or any element of its systems at any
time to: (1) improve the Services or (2) facilitate the continued economic
provisions of the Service, M&I may, at any time, withdraw any of the Services
upon providing one hundred eighty (180) days' prior written notice to Customer,
M&I may also terminate any of the Services immediately upon any regulatory,
legislative, or judicial determination that providing such Services is
inconsistent with applicable law or regulation or upon imposition by any such
authority of restrictions or conditions which would detract from the economic or
other benefits to M&I or Customer to any element of the Services.
10. Disaster Recovery. M&I maintains, and shall continue to maintain
throughout the term of this Agreement, off-site disaster recovery capabilities
which permit M&I to recover from a disaster and continue providing Services to
Customers within a commercially reasonable period. An executive summary of the
current disaster recovery plan, which may change from time to time, is available
upon request from M&I at no charge. M&I shall test the operation and
effectiveness of its disaster recovery plan at least annually. M&I maintains,
- 9 -
and shall continue to maintain throughout the term of this Agreement, a backup
power supply system to guard against electrical outages.
11. Events of Default. It shall be an Event of Default on the part of
the Customer if: (1) Customer is insolvent, or a receiver or conservator shall
be appointed with respect to the Customer; or (2) Customer shall fail to pay any
sum due M&I within the prescribed time; or (3) if the Customer shall fail to
perform any of its other covenants or obligations under this Agreement. It shall
be an Event of Default on the part of M&I If M&I shall fail to perform any of
its obligations under this Agreement where the failure of M&I to perform has a
material adverse Impact on Customer and is material to the provision of the
Services, except for those obligations under Section 20 of this Agreement as to
which the Agreement provides specific remedies for M&I's failure to perform. The
defaulting party shall have ten (10) days from the date of receipt of notice
from the nondefaulting party of nonpayment or nonperformance to cure such an
Event of Default, before the nondefaulting party may exercise any remedies it
may have as a result of the Event of Default.
12. Remedies Upon Default; Limitation of Liabilities. If an Event of
Default occurs on the part of the Customer, and is not cured within the ten (10)
day period prescribed in Section 11, M&I may: (1) terminate this Agreement; (2)
terminate access to its central processing unit by the Customer; and (3) declare
all amounts payable under this Agreement to be immediately due payable and file
suit for or otherwise obtain payment from the Customer of any fees or other sums
due it pursuant to this Agreement, plus any actual damages to its equipment or
systems caused by the Customer's actions, failures to act, equipment, systems or
communication facilities, plus any profits lost because of the Customer's
default. If an Event of Default occurs on the part of M&I, and is not cured
within the ten (10) day period prescribed in Section 11, the Customer may only:
(1) terminate this Agreement and (2) file suit or otherwise obtain payment of an
aggregate amount of up to the greater of (a) *** dollars ($***) or (b) the
amount of fees paid by the Customer to M&I hereunder during the three (3) months
immediately preceding the Event of Default. Either party may also seek specific
performance, including injunctive relief, for a breach of Section 5 of this
Agreement. M&I and the Customer agree that these damage provisions are
reasonable in light of all present predictable circumstances (including
expectable actual damages in that the fees to be charged by M&I hereunder do not
include amounts sufficient to insure against greater claims). M&I and Customer
expressly waive all claims for additional, incidental, consequential,
compensatory, or punitive damages and agree that the remedies set forth in this
Agreement shall be the sole and exclusive remedies of the parties. No lawsuit or
other action may be brought by either party hereto or on any claim or
controversy based upon or arising in any way out of this Agreement after one (1)
year from the date of the occurrence allegedly giving rise to the action, except
for nonpayment of sums due to M&I by Customer. M&I agrees that except in the
case of an Event of Default relating to a breach by the Customer of its
confidentiality obligations under Section 5 of this Agreement, M&I will not
exercise its remedy to terminate Customer's access to the M&I central processing
unit so long as: (a) Customer is current in the payment of all amounts due M&I
as reflected on M&I's last invoice
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* [Confidential portions of this Exhibit have been omitted and filed separately
with the Commission. Omitted terms are indicated by ***.]
to Customer; and (b) only exercise such remedy after providing Customer with
sixty (60) days' prior written notice.
13. Termination.
a. End of Initial Term. This Agreement shall automatically be
extended at the end of the initial eighty-four (84) month term for an additional
eighteen (18) month renewal term, unless the Customer gives M&I at least one
hundred eighty (180) days' prior written notice of its intent to terminate,
which notice may be given during the initial term on the Agreement.
b. Renewal Term. During the renewal term, this Agreement shall be
automatically extended for an additional one (1) month on each monthly
anniversary date so that the term shall always be not less than one (1) month
less than eighteen (18) months, unless either party gives written notice to the
other party of notice to terminate, in which event the automatic monthly
renewals will end and the Agreement will terminate at the end of the unexpired
portion of the term in existence on the date notice to terminate is given.
c. Termination Upon Default. This Agreement may also terminate upon
an Event of Default and failure to cure beyond applicable cure periods at the
option of the nondefaulting party as set forth in Section 12 hereof.
d. Termination by Customer. Customer may terminate this Agreement at
any time, and without cause, by giving M&I at least one hundred eighty (180)
days' prior written notice and paying M&I the then-applicable buyout amount set
forth in Section 21.
14. Regulatory Assurances. M&I and Customer acknowledge and agree that
the performance of these Services will be subject to regulation and examination
by Customer's regulatory agencies to the same extent as if such Services were
being performed by Customer, Upon request, M&I agrees to provide any appropriate
assurances to such agency and agrees to subject itself to any required
examination or regulation. Customer agrees to reimburse M&I for reasonable costs
actually incurred due to any such examination or regulation that is performed
solely for the purpose of examining data processing services used by Customer.
a. Notice Requirements. The Customer shall be responsible for
complying with all regulatory notice provisions to any applicable governmental
agency, which shall include providing timely and adequate notice to the Chief
Examiner of the Federal Home Loan Bank Board, the Office of Thrift Supervision,
the Office of the Comptroller of the Currency, the Federal Deposit Insurance
Corporation, the Federal Reserve Board, or their successors, as applicable
(collectively, the "Federal Agency"), as of the effective date of Services under
this Agreement, identifying those records to which this Agreement shall apply
and the location at which such Services are to be performed.
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b. Examination of Records. The parties agree that the records
maintained and produced under this Agreement shall, at all times, be available
for examination and audit by governmental agencies having jurisdiction over the
Customer's business including (without limitation) the Federal Agency. The
Director of Examinations of the Federal Agency or his designated representative
shall have the right to ask for and to receive directly from M&I any reports,
summaries, or information contained in or derived from data in the possession of
M&I related to the Customer. M&I shall notify Customer as soon as possible of
any formal request by an authorized governmental agency to examine Customer's
records maintained by M&I, if M&I is permitted to make such a disclosure to
Customer under applicable law or regulations. Customer agrees that M&I is
authorized to provide all such described records when formally required to do so
by this authorized governmental agency.
c. Fidelity Bonds. At Customer's request, M&I shall obtain, at
Customer's expense, fidelity bond coverage for M&I and its employees as such
coverage is required by any governmental or regulatory agency.
d. Notice of Changes. Customer shall give to the Director of
Examinations of the Federal Agency at least thirty (30) days' notice of the
termination of this Agreement or of any material changes in the Services to be
provided hereunder.
e. Insurance. Throughout the term of this Agreement, M&I shall
maintain insurance coverage (or shall be self-insured) for losses from fire,
disaster, and other causes contributing to interruption of the Services. The
proceeds of such insurance shall be payable to M&I. Nothing in this Agreement
shall be construed as to permit Customer to receive any of such proceeds, or to
be named as an additional loss payee under any insurance policy.
f. Financial Information. Customer agrees to provide M&I with a copy
of the Call Report filed with the Federal Agency simultaneously with its filing
with the Federal Agency, and to provide such additional financial information as
to its creditors or others as M&I may reasonably request.
15. Transportation and/or Transmission of Data. The responsibility
and expense for transportation and/or transmission of and risk of loss of data
and media to and from M&I's datacenters shall be borne by Customer. M&I will
notify Customer of the time by which Customer's data and media must be delivered
to M&I for processing for M&I to provide Customer's processed data within the
time period indicated by M&I.
16. Responsibility.
a. General. M&I agrees to perform the Services in a commercially
reasonable manner which is similar to the services provided to other M&I
customers, and no other or higher degree of care. Except as otherwise described
herein, M&I assumes no other
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obligation as to performance or quality of the Services provided, all other
risks of error being expressly assumed by Customer. M&I shall not be responsible
for loss or damage due to delays in processing or in the delivery of processed
data as a result of any of the causes excused by Section 19 hereof. M&I WILL IN
NO EVENT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
INCURRED BY CUSTOMER INCLUDING BUT NOT LIMITED TO, LOST PROFITS OR BUSINESS
OPERATION LOSS, REGARDLESS OF WHETHER M&I WAS ADVISED OF THE POSSIBLE OCCURRENCE
OF SUCH DAMAGES,
b. Reliance on Data Supplied. M&I will process items and data and
perform those Services described in this Agreement on the basis of Information
furnished by Customer. M&I shall be entitled to rely upon any such data,
information, or instructions as provided by Customer. If any error results from
incorrect input supplied by Customer, Customer shall be responsible for
discovering and reporting such error and supplying the data necessary to correct
such error to M&I for processing at the earliest possible time. Customer will
indemnify and hold M&I harmless from any cost, claim, damage, or liability
(including attorney's fees) whatsoever arising out of such data, information or
instructions, or any inaccuracy or inadequacy therein. Customer assumes all risk
of loss, delay, and miscommunication in the transportation or transmission by
electronic means of data and information from any terminal or remote unit unless
the same is caused by or attributable to any act or omission on M&I's part,
which act or omission does not meet the standard of care in Section 16(a), or
was caused by or attributable to any gross negligence or willful failure on
M&I's part to comply with its obligations under this Agreement,
c. Data Backup. Customer shall maintain adequate records including
microfilm images of items being transported to M&I, or at least ten (10)
business days' backup on magnetic tape or other electronic media where
transactions are being transmitted to M&I, from which reconstruction of lost or
damaged items or data can be made. Customer assumes all responsibility and
liability for any loss or damage resulting from failure to maintain such
records.
d. Audit. M&I shall cause a third-party review of its data
processing systems and Services to be conducted annually by its independent
auditors. M&I shall provide Customer upon request, at its then-current charge,
one copy of the report resulting from such review.
e. Regulatory Compliance. Customer is responsible for determining
that the Services performed in its behalf, any forms which are used with its
customers, and all records it retains comply with all applicable laws. Should
Customer need information from the Services M&I provides in order to comply with
applicable Federal or State laws and regulations, Customer's sole remedy, and
M&I's sole obligation shall be for M&I to provide the ability to process the
information requested from the Customer as promptly as is commercially
practicable.
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f. Balancing and Controls. On a daily basis, Customer shall review
all input and output, controls reports, and documentation, to ensure the
integrity of data processed by M&I. In addition, Customer shall, on a daily
basis, check exception reports to verify that all file maintenance entries and
nondollar transactions were correctly entered. Customer is responsible for
initiating timely remedial action to correct any improperly processed data which
these reviews would disclose.
g. Service Deficiencies. If Customer is aware that a defect exists
in a Service, Customer shall be responsible for making whatever appropriate
adjustments may thereafter be necessary until M&I corrects the defect and, if
requested by Customer,' M&I will, at M&I's expense, assist Customer in making
such corrections through the most cost-effective means, whether manual, by
system reruns, or program modifications. M&I will, where reasonable, make every
effort to correct any known material defect as soon as commercially reasonable
at M&I's expense,
17. Ownership of Data. Customer is the owner of all of its data
supplied by Customer to M&I for processing hereunder. Customer acknowledges that
it has no rights in any of the software, systems documentation, guidelines,
procedures, and similar related materials or any modifications thereof except
with respect to M&I's use of the same during the term of this Agreement to
process data. Upon termination of this Agreement, M&I shall provide Customer
with all copies of Customer's data in a format that is being used by M&I at that
time for processing such data. Prior to the release of the Customer's data: (1)
all amounts owed under this Agreement by Customer to M&I shall be current and
paid in full, and (2) Customer shall pay M&I its "Estimated Deconversion
Expenses" as described below. Customer agrees to pay M&I for M&I's work in
providing such data at M&I's rates then in effect for computer and personnel
time, supplies, and other items as required, and Customer further agrees to pay
M&I for any and all charges associated with the deconversion of Customer's data
based on M&I's then-current charges for such Services. M&I shall make a good
faith estimate of all of such costs, expenses, and charges which shall be paid
by Customer in advance (the "Estimated Deconversion Expenses"), The difference,
if any, between the actual expenses and the prepaid Estimated Deconversion
Expenses shall be promptly paid after determination.
18. Warranties. M&I represents and warrants that:
a. Capability of Computer Systems and Software. M&I's computer
systems (hardware and software) are capable of performing the Services in
accordance with the provisions of this Agreement. The software used to provide
the Services will operate substantially in accordance with the specifications
and documentation for the software as modified from time to time to incorporate
enhancements or modifications of the software to provide the Services.
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b. Quality of Service. The reports and Services made available to
Customer shall be in substantial conformity with the User Manuals, as amended
from time to time, copies of which have been, or will be, provided to Customer.
c. Property Rights. M&I has the right to provide the Services
hereunder, using all computer software required for that purpose.
d. Organization and Approvals. M&I is a validly organized corporate
entity with valid authority to enter into this Agreement. This Agreement has
been duly authorized by all necessary corporate action,
e. Disclaimer of Warranties. EXCEPT AS DESCRIBED IN THIS SECTION OF
THIS AGREEMENT M&I DISCLAIMS ALL OTHER WARRANTIES WHETHER WRITTEN, ORAL,
EXPRESSED OR IMPLIED INCLUDING WITHOUT LIMITING THE GENERALITY OF THE FOREGOING,
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
19. Force Majeure. M&I shall not be liable to Customer if M&I's
fulfillment or performance of any terms or provisions of this Agreement is
delayed or prevented by revolution or other civil disorders, wars, acts of
enemies, strikes, electrical equipment or availability failure, labor disputes,
fires, floods, acts of God, federal, state, or municipal action, statute,
ordinance or regulation, or, without limiting the foregoing, any other causes
not within its reasonable control, and which by the exercise of reasonable
diligence it is unable to prevent, whether of the class of causes hereinbefore
enumerated or not.
20. Data Services Reliability and Responsiveness. Subject to the
nonoccurrence for a force majeure and the performance of Customer's obligations
described in this Agreement, M&I agrees that the services will be provided in
accordance with the following standard. M&I will initiate batch processing
transmission to Customer or make the processed items and reports available for
delivery within six (6) hours after receiving all input data from Customer, and
with such performance being achieved a minimum of ninety percent (90%) of the
time measured over a calendar month. M&I will ensure that its on-line network is
available for the processing of Customer's on-line transactions at a minimum of
ninety-five percent (95%) of the time measured over a calendar month at the
point of departure from M&I's communications controller. Upon receipt of data
transmitted by Customer at M&I's communications controller, M&I will process the
transaction within 2.5 seconds for teller transactions and within 4.0 seconds
for CRT transactions at a minimum ninety-seven percent (97%) of the time
measured over a calendar month. Customer will notify M&I in writing if this
level of performance is not achieved, and M&I shall have ninety (90) days to
meet this performance standard. If after ninety (90) days the performance
standard still has not been met, the Customer's sole remedy shall be to either
(i) terminate the agreement without penalty upon giving M&I written notice
within thirty (30) days after the expiration of the ninety (90) day cure period,
or (ii) accept such deficient levels which M&I does achieve. M&I assumes no
other liability, express or implied, with respect to its obligations set forth
in this paragraph.
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21. Contract Buyout.
a. Customer may terminate this Agreement at any time by giving M&I
at least one hundred eighty (180) days' prior written notice and paying M&I ***
percent (***%) of the total estimated remaining unpaid monthly processing fees.
For the purpose of this computation, total estimated remaining unpaid monthly
processing fees shall be equal to the mean average of the total monthly fees
paid in the three (3) months preceding the termination notice, multiplied by the
number of months remaining in the Agreement.
b. The contract buyout amount set forth above shall be paid prior to
the deconversion of any affected accounts. The contract buyout amount shall be
paid by Customer regardless of the form by which the termination occurs,
including but not limited to, sale of assets or stocks assumption of
liabilities, merger, consolidation, absorption, liquidation, or termination as a
result of an Event of Default on the part of Customer (as described in Section
11 of this Agreement).
22. IRS Filing. Customer has complied with all laws, regulations,
procedures, and requirements in attempting to secure correct Tax Identification
Numbers (TINs) for Customer's payees and agrees to attest to this compliance by
affidavit provided annually. Customer authorizes M&I to act as Customer's agent
and sign on Customer's behalf the Affidavit required by the Internal Revenue
Service on Form 4804, or any successor form.
Customer acknowledges that M&I's execution of the Form 4804 Affidavit
on Customer's behalf does not relieve Customer of responsibility to provide
accurate TINs or liability for any penalties which may be assessed for failure
to comply with TIN requirements. Customer agrees to hold M&I harmless from any
liabilities, claims, expenses, penalties, or damages (including attorneys' fees)
which may be assessed or incurred as a result of the failure to comply with TIN
requirements.
23 Expense Reimbursements. Customer agrees to reimburse M&I for all
out-of-pocket expenses (travel, lodging, meals, long distance telephone calls,
and printing and copying charges) reasonably incurred in connection with the
conversion of Customer's accounts to the M&I system. The reimbursement of such
expenses is in addition to conversion charges which may arise after the
conversion, or with respect to accounts which are not currently customer
accounts which are to be converted to the M&I system. M&I shall estimate such
expenses in advance, and Customer shall pay such expenses in three (3) equal
payments as follows: first, upon execution of this Agreement; second, upon
delivery by M&I of conversion test reports; and final, on the conversion date.
M&I shall provide Customer with a summary invoice of actual expenses, and any
adjustments shall be paid upon delivery of the invoice.
24. Conversion Obligations. Both parties agree to make a good faith
effort to convert Customer's data in a timely fashion and to perform the
conversion in accordance with the
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* [Confidential portions of this Exhibit have been omitted and filed separately
with the Commission. Omitted terms are indicated by ***.]
responsibilities set forth in the M&I Conversion Manual, the Conversion
Schedule, and this Agreement. Customer agrees to maintain an adequate staff of
persons who are knowledgeable with the systems currently used by Customer to
process data, Customer further agrees to provide such Services and perform such
obligations as are contemplated by the M&I Conversion Manual and the Conversion
Schedule, and as necessary for Customer to timely and adequately perform its
obligations herein and therein. Customer shall pay or reimburse M&I for all
out-of-pocket expenses and on a time-and materials basis for any of its
personnel, or any independent contractors who perform conversion or related
services (including items identified as Customer Responsibilities in the
Conversion Manual) for Customer. Customer further agrees to cooperate fully with
all reasonable requests of M&I necessary to effect the conversion in a timely
and efficient manner. Customer agrees to reimburse M&I for all conversion
charges whether for the initial conversion, or for the subsequent conversion of
additional accounts as they are incurred, or for the conversion of products not
identified in the Proposal.
25. Product Support. (This Section of the Agreement shall not apply to
this Agreement if so indicated on Exhibit A). Customer agrees to maintain a
staff of individuals who are trained and understand the system used to provide
the Services required for M&I to provide the ongoing Services. The individuals
will have primary responsibility for assisting and guiding the Customer's user
community in the proper use of the systems, and providing first line of support
to the users after conversion. The primary contact with M&I's technical,
operational, and product support staff will be through these individuals.
26. Use of the Services. (a) Customer assumes exclusive responsibility
for the consequences of any instructions Customer may give M&I, for Customer's
failure to properly access the Services in the manner prescribed by M&I, and for
Customer's failure to supply accurate input information; (b) Customer agrees
that it will use the Services in accordance with such reasonable policies as may
be established by M&I from time to time as set forth in any materials furnished
by M&I to Customer; (c) Customer agrees that, except as otherwise permitted by
M&I, Customer will use the Services only for its own internal business purposes
and will not sell or otherwise provide, directly or indirectly, any of the
Services or any portion thereof to any third party; and (d) Customer agrees and
represents that (i) this Agreement has been approved by its Board of Directors,
or that the officer executing this Agreement has been specifically authorized by
Customer's Board of Directors to execute this Agreement, (ii) the performance of
this Agreement by the Customer will not affect the safety or soundness of the
Customer or any of its affiliates, and (iii) this Agreement, and the obligations
evidenced hereby, will be properly reflected on the books and records of the
Customer, and the Customer will provide evidence of the same to M&I upon
request.
27. Miscellaneous
a. Governing Law. This Agreement shall be construed and governed by
the laws of the state of Wisconsin.
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b. Amendment. This Agreement, including the Schedules hereto, may be
amended only by an instrument in writing executed by the parties or their
permitted assignees.
c. Assignment. This Agreement may not be assigned by either party
without the prior written consent of the other party, which such consent shall
not be unreasonably withheld, provided that M&I may freely assign this Agreement
to any company that is directly or indirectly (1) in control of M&I, (ii) under
the control of M&I, or (iii) under common control with M&I.
d. Section Headings. Section headings are for reference purposes
only and shall not affect the interpretation or meaning of this Agreement.
e. Notices. All communications or notices required or permitted by
this Agreement shall be in writing and shall be deemed to have been given at the
earlier of the date when actually delivered to an officer of a party or when
deposited in the United States mail, certified or registered mail, postage
prepaid, return receipt requested, and addressed as set forth on the signature
page, unless and until any of such parties notifies the others.
f. No Waiver of Performance. Failure by either party at any time to
require performance by the other party to claim a breach of any provision of
this Agreement will not be construed as a waiver of any right accruing under
this Agreement, nor affect any subsequent breach, nor affect the effectiveness
of this Agreement or any part hereof, nor prejudice either party as regards any
subsequent action.
g. Entire Agreement; Conflicting Provisions. This Agreement,
together with the Schedules hereto, constitutes the entire agreement between the
Customer and M&I with respect to the subject matter hereof. There are no
restrictions, promises, warranties, covenants, or undertakings other than those
expressly set forth herein and therein. This Agreement supersedes all prior
negotiations, agreements, and undertakings between the parties with respect to
such subject matter. In the event of any conflict between the terms of the main
body of this Agreement and any of the Schedules hereto, the terms of the main
body of this Agreement shall govern.
h. Execution in Counterparts. This Agreement may be executed
simultaneously in any number of counterparts, each of which shall be deemed an
original but all of which shall together constitute one and the same Agreement.
i. Enforceability. The invalidity or enforceability of any provision
hereof shall not affect or impair any other provisions.
j. Scope of Agreements. If the scope of any of the provisions of the
Agreement is too broad in any respect whatsoever to permit enforcement to its
full extent, then such provisions shall be enforced to the maximum extent
permitted by law and the parties hereto
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consent and agree that such scope may be judicially modified accordingly and
that the whole of such provisions of this Agreement shall not thereby fail, but
that the scope of such provisions shall be curtailed only to the extent
necessary to conform to law.
k. Miscellaneous. Product support and programming conversion fees
will be waived in connection with the conversion of Customer onto M&I's data
processing systems. However, in the event Customer fails to obtain the
appropriate regulatory approvals necessary for the operation of a Financial
Institution on or before July 1, 1992, this Agreement shall be automatically
null and void ab initio and neither party shall have liability to each other
under this Agreement, except that Customer shall pay for any costs incurred by
M&I as a result of any conversion activities performed by M&I.
l. Computer-Based Training. During the first twelve (12) months of
the Agreement, M&I will provide Customer, at no additional charge, two (2)
copies of any Computer-Based Training (CBT) course relating to the applications
converted onto M&I's data processing systems.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed in their names as of the date first above written.
M&I DATA SERVICES,
INC, (M&I) 770 North
Water Street
Milwaukee, WI 53202
By: /s/ Joseph L. Delgadillo
-----------------------------------------
Name: Joseph L. Delgadillo
Senior Vice President
M&I DATA SERVICES INC. ("M&I")
770 North Water Street
Milwaukee, WI 53202
By: /s/ Michael V. Ruane
-----------------------------------------
Name: Michael V. Ruane, Vice Pres.
MERRILL MERCHANTS BANCSHARES,
INC.,
(the "Customer")
201 Main Street
Bangor, ME
By: /s/ Perry B. Hansen
-----------------------------------------
Name: Perry B. Hansen, President
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AFFIDAVIT
STATE OF Illinois
COUNTY OF Rock Island
I, Perry B. Hansen , being first duly sworn, on oath, depose and say:
1. I am an employee of Merrill Merchants Bancshares, Inc. I have
personal knowledge of my employer's practices with regard to procuring and
reporting Tax Identification Numbers (TINs) and authority to execute this
Affidavit on my employer's behalf.
2. Merrill Merchants Bancshares, Inc. has complied with all laws,
regulations, procedures and requirements in attempting to secure correct TINs
for its payees. This compliance has been pursued with due diligence, and any
failure to secure correct TINs is due to reasonable cause.
/s/ Perry B. Hansen
---------------------------------------------
Customer's Representative
Perry B. Hansen
President
Subscribed and sworn to
before me this 14th day
of May 1992,
/s/ John T. Kustes
- ------------------
Notary Public
My Commission:
"OFFICIAL SEAL"
JOHN T. KUSTES
Notary Public, State of Illinois
My Commission Expires 05/08/96
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ATTORNEY-IN-FACT APPOINTMENT
Customer hereby appoints M&I Data Services, Inc. ("M&I") as customer's
attorney-in-fact and empowers M&I to authorize the Internal Revenue Service
(IRS) to release information documents supplied to the IRS by M&I to states
which participate in the "Combined Federal/State Program." Customer agrees to
hold M&I harmless from any liabilities, claims, expenses, penalties, or damages
(including attorneys' fees) which may be assessed or incurred as a result of the
release of information.
MERRILL MERCHANTS BANCSHARES,
INC, ("Customer")
By /s/ Perry B. Hansen
-------------------
Customer's Representative
Perry B. Hansen, President
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SCHEDULE
M&I ON-LINE AVAILABILITY
The following is a list of standard hours of availability by each on-line
service. times are CST/CDT.
o Cardholder
(CRT Maintenance)
Monday-Thursday 7:00 a.m.- 6:45 p.m.
Friday 7:00 a.m.- 9:30 p.m.
Saturday 7:00 a.m.- 4:30 p.m.
o CIS & Deposit System
(Maintenance and Dollar Transactions)
Monday-Thursday 7:00 a.m.- 6:45 p.m.*
Friday 7:00 a.m.- 9:30 p.m.*
Saturday 7:00 a.m.- 4:30 p.m.
o Data Entry
(Account Reconciliation System)
Monday-Friday 7:00 a.m.-10:00 p.m.
o Data Entry
(Financial Control)
Monday-Thursday 7:00 a.m.-11:00 p.m.
Friday 7:00 a.m.-12:00 Midnight
Saturday 7:00 a.m.- 4:30 p.m.
o Decision Management System
Monday-Thursday 7:00 a.m.- 6:45 p.m.
Friday 7:00 a.m.- 9:30 p.m.
Saturday 7:00 a.m.- 4:30 p.m.
o Data Entry
(Trust)
Monday-Friday 7:00 a.m. - 5:00 p.m.
o Financial Control On-line
Monday-Friday 7:00 a.m. - 8:00 p.m.
Saturday 7:00 a.m. - 4:30 p.m.
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o Loan System
(CRT Maintenance)
Monday-Thursday 7:00 a.m. - 6:15 p.m.
Friday 7:00 a.m. - 8:30 p.m.
Saturday 7:00 a.m. - 4:30 p.m.
o Management Information Service
Monday-Thursday 7:00 a.m. - 6:45 p.m.
Friday 7:00 a.m. - 9:30 p.m.
Saturday 7:00 a.m. - 4:30 p.m.
(Except Money Market Info.)
o Teller Terminals
Monday-Thursday 7:00 a.m. - 7:00 p.m.
Friday 7:00 a.m. - 9:30 p.m.
Saturday 7:00 a.m. - 4:30 p.m.
*CIS access to loan data is based on Loan System hours of availability. West
Coast availability for CIS, Loans, and Deposits for Monday-Friday is 8:00
a.m.-10:00 p.m., CST/CDT.
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EXHIBIT A
FINANCIAL SERVICE PRODUCTS
- - Deposit Services
- - Loan Services
- - Teller/Platform Services
- - Automated Funds Transfer
- - Automated Clearinghouse
- - Corporate Cash Management Services Customer Information System
- - Financial Control
- - Tickler System
- - Management Information Service
- - IRS Reporting
- - INFO Center
- - EFT Services
- - Safe Deposit System
- - Item Processing
- - Remote Site Support
- - Trust Services
- - Audit Services
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EXHIBIT B
FEE SCHEDULE
[All of the information in this schedule pertains to confidential fee
information found in the Agreement's "1998 Product Price List." It has been
omitted and filed separately with the Commission. This Exhibit totals seventy
eight (78) expurgated pages.]
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