**Exhibit 10.1**
**EMPLOYMENT AGREEMENT**
     **THIS AGREEMENT**is made as of the 12th day of August, 2004, betweenMERCHANTS AND MANUFACTURERS BANCORPORATION, INC. (the “Company”), a Wisconsincorporation, its successors and assigns, and JEFFREY A. MUELLER (the“Executive”).
**RECITALS**
     **WHEREAS**, Executive has been a valued, long-term employee of WisconsinState Bank, a state-chartered commercial bank located in Random Lake, Wisconsin(the “Bank”) that is being acquired by the Company in accordance with theAmended and Restated Agreement and Plan of Merger by and among the Company,Merchants Merger Corp. and Random Lake Bancorp Limited dated as of June 11,2004 (the “Merger Agreement”), whose experience in the industry and employmentwill benefit the Employer in the future; and
     **WHEREAS**, Employer desires to provide for management continuity andstability and for the services of Executive.
**AGREEMENT**
     **NOW, THEREFORE**, in consideration of the mutual covenants and agreementsset forth below:
     1. **Employment**. Company, or one or more of its affiliates (together, the“Employer”) shall employ Executive and the Executive shall serve the Employer,on the terms and conditions set forth herein for the period provided in Section2.
     2. **Term of Employment**. The period of Executive’s employment under thisAgreement shall be deemed to have commenced as of the date first above writtenand shall continue until December 31, 2008. Commencing on January 1, 2006, andcontinuing on the first day of each year thereafter, the Agreement shallautomatically renew for an additional twelve (12) months such that theremaining term shall be forty-eight (48) months unless written notice isprovided by either party at least sixty (60) days prior to the first day of theapplicable renewal year, that the Agreement shall terminate at the end ofthirty-six (36) months following such renewal date. Prior to the renewal ornon-renewal of the Agreement, the Company’s Board of Directors or the ExecutivePersonnel/Compensation Committee (either of which shall be the “Board”) willconduct a performance evaluation of the Executive and the results thereof shallbe included in the minutes of the Board meeting. The term of employment underthis Agreement, as in effect from time to time, shall be referred to as the“Employment Term.”
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     3. **Positions and Duties**. Executive shall serve Employer as the presidentand chief executive officer of the Bank. Executive shall provide suchmanagement services as are customarily performed by persons serving in similarcapacities at other banking affiliates of the Company, and perform such otherduties as may be appropriate to his position. Excluding periods of vacation towhich the Executive is entitled, during the Employment Term the Executiveagrees to devote full time and attention to the business and affairs of theEmployer to the extent necessary to discharge the responsibilities assigned tothe Executive hereunder, provided that the Executive may take reasonableamounts of time to serve on corporate, civil or charitable boards orcommittees, if such activities do not significantly interfere with theperformance of the Executive’s responsibilities hereunder. It is expresslyunderstood and agreed that to the extent any such activities have beenconducted by the Executive prior to the date of this Agreement, the continuedconduct of such activities (or the conduct of activities similar in nature andscope) subsequent to the date of this Agreement shall not thereafter be deemedto interfere with the performance of Executive’s responsibilities hereunder.The Executive agrees to devote substantially all of his business time, effortsand skills to the performance of his duties and responsibilities under thisAgreement; provided, however, that nothing in this Agreement shall preclude theExecutive from devoting reasonable periods of time required for participatingin certain other businesses in which he has a significant ownership stake; aslong as such participation does not substantially interfere with theExecutive’s regular performance of his duties and responsibilities hereunder.
     4. **Compensation**. As compensation for services provided pursuant to thisAgreement, Executive shall receive the compensation and other benefits setforth below:
     (i) **Base Salary**. During the Employment Term, Executive shallreceive an annual base salary (“Base Salary”) in such amounts as may fromtime to time be approved by the Board. The Base Salary in effect as ofthe Commencement Date shall be one hundred thirty thousand dollars($130,000.00). Such amount shall be subject to review and to annualadjustment by the Board in accordance with Employer’s normal personnelpractices; provided, however, that the Base Salary shall not decrease asa result of such an annual adjustment. No increase in Base Salary orother compensation shall limit or reduce any other obligation ofEmployer. Executive’s Base Salary and other compensation shall be paidin accordance with Employer’s regular payroll practices. Review andadjustment of Executive’s Base Salary shall be done on a basis comparableto, and applied uniformly with that utilized for other executives ofEmployer and/or its affiliates.
     (ii) **Bonus Payments**. In addition to Base Salary, Executive shall beentitled, during the Employment Term, to participate in and receivepayments from all bonus and other incentive compensation plans as ineffect from time to time on the same basis as other executive officers ofEmployer.
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     (iii) **Stock Options**.
     (a) On the same date of this Agreement, Executive shallreceive a grant of stock options for 20,000 shares of common stockof the Company under the Company’s 1996 Incentive Stock OptionPlan, as amended (the “Plan”). The stock option grant shall be ofboth incentive stock options and nonstatutory stock options.
     (b) The stock options shall vest on the following vestingdates: August 12, 2004, December 31, 2005, March 31, 2006 andMarch 31, 2007. In order for the maximum amount of the stockoptions to qualify as incentive stock options under the Code, theEmployer shall structure the vesting of the stock options such thatthe maximum amount of incentive stock options that becomeexercisable by the Executive during a calendar year (which shall bethe amount of shares of common stock of the Company with a FairMarket Value (as defined in the Plan) of $100,000, determined as ofthe date of grant) shall vest on each of the above four vestingdates. The remainder of the stock options, which shall benonstatutory stock options, shall vest in equal portions onDecember 31, 2005 and March 31, 2006.
     (c) The Employer shall structure the stock option grant suchthat only stock options that have vested shall be exercisable bythe Executive or his beneficiaries on or after the TerminationDate, except in the event of the Executive’s death, disability,retirement, or a change in control of the Company as defined belowin Subsection 4 (iii)(d), or the termination of the Executive’semployment in accordance with Subsection 5(v) or by the Employerwithout Cause. Upon the death, disability or retirement of theExecutive, or a change in control of the company as defined inSubsection 4(iii)(d), or the termination of the Executive’semployment in accordance with Subsection 5(v) or by the Employerwithout Cause, all options granted on the date of this Agreementthat have not become exercisable as of the Termination Date shallbecome immediately exercisable.
     (d) For purposes of this Agreement, a “change in control”shall be deemed to have occurred if any “individual, entity orgroup” (as such term is used in Sections 13(d) and 14(d) of theExchange Act) is or becomes the “beneficial owner” (as defined inRule 13d-3 under the Exchange Act), directly or indirectly, ofsecurities representing 25% or more of the voting power of thesecurities of the Company or of the Bank or becomes the owner ofall or substantially all of the assets of the Company or of theBank or if the shareholders of the Company or of the Bank approve areorganization, merger or consolidation of the Company or of theBank. “Change in control” shall not refer to or include anytransaction involving only entities affiliated directly orindirectly with the Company.
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     (e) The stock options granted to the Executive on the date ofthis Agreement shall remain exercisable by the Executive or hisbeneficiaries for one (1) year after the Executive’s termination ofemployment if the termination is as a result of the Executive’sdeath or disability. In the event the Executive’s employment isterminated as a result of his normal retirement, the Executive orhis beneficiaries shall have ninety (90) days after suchtermination of employment to exercise the stock options. In theevent the Executive’s employment is terminated for any reason otherthan due to his death, disability, or retirement, the Executive orhis beneficiaries shall have thirty (30) days after suchtermination of employment to exercise the stock options. Nothingcontained herein should be construed to extend the ultimate term ofany of the stock options beyond the period of ten (10) years fromthe date of their grant.
     (f) Shares of common stock of the Company acquired upon theexercise of the stock options granted to the Executive on the dateof this Agreement shall not be subject to the transfer restrictionsof Section 8 of the Plan. However, Executive shall provide writtennotice to the Company in the event the Executive sells or otherwisedisposes of common stock acquired upon the exercise of an incentivestock option granted on the date of this Agreement before the laterof the expiration of the two-year period beginning on the date ofthe grant of such stock options or the expiration of the one-yearperiod beginning on the date the Executive acquires such stock.Executive shall provide the written notice no later than thirty(30) days after the date of the disposition of his shares.
     (iv) **Other Benefits**. During the Employment Term, Employer shallprovide to Executive, in addition to Base Salary, such other benefits ofemployment (or, with Executive’s consent, equivalent benefits) as aremade generally available to executive officers serving in comparablepositions at Employer or its affiliates. Such benefits includeparticipation in any group health, life, disability, or similar insuranceprogram and in any pension, profit sharing, deferred compensation, 401(k)or other similar retirement program provided. Executive shall also havethe right to participate, on the same basis as other executives ofEmployer, in any stock purchase, stock option or stock appreciationrights plans, or other stock-based program made available to suchexecutive officers. Executive shall also be entitled to participate inany plan or program offered to other executives of Employer for thepurpose of protecting such executives in the event of a change in controlof the Company, as defined in Subsection 4(iii)(d), except that Executiveshall not be entitled to participate in the Company’s SupplementalExecutive Retirement Plan instituted in 2003.
     Through the Termination Date, as defined in Section 5 below,Executive shall be entitled to continue his participation in the currentdeferred compensation program of the Bank, as enumerated in the WisconsinState Bank Deferred Compensation Agreement
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between Bank and Executive dated as of December 12, 2002 (the “DeferredCompensation Agreement”). For purposes of the Deferred CompensationAgreement, the Executive shall be deemed to be an employee of the Bankthrough the Termination Date.
     Executive shall be entitled to four weeks vacation, in addition toother perquisites in the same manner and to the same extent as providedother executives of Employer. Executive shall be entitled to use of acar, the cost of such use to be paid for by Employer. The type of carprovided to the Executive shall be consistent with the type of carprovided to similarly situated executives of the Employer.
     Nothing contained herein shall be construed as granting Executivethe right to continue in any benefit plan or program, or to receive anyother perquisite of employment, provided under this section 4(iv) (exceptto the extent Executive had previously earned or otherwise accumulatedvested rights therein) following a valid and lawful termination ordiscontinuance of such plan, program or perquisite.
     5. **Termination**. This Agreement may be terminated, subject to payment ofthe compensation and other benefits described below, upon occurrence of any ofthe events described herein. The date on which Executive ceases to be employedunder this Agreement, after giving effect to the period of time specified inany notice requirement, is referred to as the “Termination Date.”
     (i) **Death; Disability; Retirement**. This agreement shall terminateupon the death, disability or retirement of Executive. As used in thisAgreement, “disability” means Executive’s inability, as the result ofphysical or mental incapacity, to substantially perform his duties for aperiod of 180 consecutive days. If the Executive and Employer cannotagree as to the existence of a disability, the determination shall bemade by a qualified independent physician acceptable to both parties, oralternatively, by a physician designated by the president of the medicalsociety for the county in which Executive resides. The costs of any suchmedical examination shall be borne by Employer. If Executive isterminated due to disability, subject to the limitations in Section 6, heshall be paid 100% of his Base Salary at the rate in effect at the timenotice of termination is given for the remaining portion of theEmployment Term, such amounts to be paid in substantially equal monthlyinstallments and offset by any monthly payments actually received byExecutive from: (a) any disability plans or disability insuranceprograms provided by Employer, and (b) any governmental social securityor workers compensation program.
     As used in this Agreement, the term “retirement” shall meanExecutive’s retirement on or after the Executive’s55th birthday or inaccordance with any retirement arrangement established for Executive withhis consent.
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     If termination occurs as a result of death, disability orretirement, no additional compensation shall be payable to Executiveunder this Agreement except as specifically provided herein.Notwithstanding anything to the contrary contained herein, iftermination occurs as a result of death, disability or retirement,Executive shall receive all compensation and other benefits to which hewas entitled under Section 4 and the plans and programs provided therein,through the Termination Date and, in addition, Executive and any familymembers covered at the time of the termination, if applicable, shallreceive or continue to receive for the remaining portion of theEmployment Term all other benefits available to Executive and such familymembers under any applicable group health, life, disability or similarinsurance program as in effect on the date of the Executive’s death,disability or retirement.
     If, following termination by reason of disability and prior to theexpiration of the then remaining balance of the Employment Term,Executive becomes able to resume his duties, he shall be reinstated tohis position, or if such position has been filled, to a position asnearly comparable as possible. From the date of reinstatement and forthe balance of the Employment Term, Executive shall be obligated toperform all duties and responsibilities, and entitled to receive allcompensation and other benefits, as provided in this Agreement.
     (ii) **Cause**. Employer may terminate Executive’s employment underthis Agreement for Cause at any time, and thereafter Employer or Bankshall have no further obligation under this Agreement. Notwithstandinganything to the contrary contained herein, Executive shall receive allcompensation and other benefits in which he was vested or to which he wasotherwise entitled under Section 4 and the plans and programs providedtherein, by reason of employment through the Termination Date.
     For purposes of this Agreement, “Cause” shall mean:
(a) A failure by Executive to substantially performhis duties (other than failure resulting from incapacity)after a written demand by the Board, which demand identifies,with reasonable specificity, the manner in which the Boardbelieves Executive has not substantially performed, andExecutive’s failure to cure within a reasonable period of timeafter his receipt of this notice; (b) A criminal conviction of or plea of *nolocontendere by*Executive for any act involving dishonesty,breach of trust or a violation of the banking laws of theState of Wisconsin or the United States which, in thereasonable judgment of the Board, is substantially related tothe Executive’s position with the Employer or substantiallyimpairs the Executive’s ability to perform his duties with theEmployer;
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(c) A criminal conviction of or plea of *nolocontendere by*Executive for the commission of any felonywhich, in the reasonable judgment of the Board, issubstantially related to the Executive’s position with theEmployer orsubstantially impairs the Executive’s ability to perform hisduties with the Employer; (d) A breach of fiduciary duty by Executive involvingpersonal profit; (e) A willful violation of any law, rule or order byExecutive (other than traffic violations or similar offenses)which, in the reasonable judgment of the Board, issubstantially related to the Executive’s position with theEmployer or substantially impairs the Executive’s ability toperform his duties with the Employer; or (f) the Executive’s engagement in gross misconduct ora material breach of any provision of this Agreement whichresults in a demonstrably material injury to the Employer,monetary or otherwise, provided such misconduct or breach wasnot in good faith and he had no reasonable belief such act oromission was in the best interests of the Employer and itsshareholders.
     For purposes of this subsection 5(ii), no act, or failure to act, onExecutive’s part shall be deemed “willful” unless done, or omitted to bedone, by Executive not in good faith and without reasonable belief thatthe action or omission was in the best interest of Employer
     (iii) **Voluntary Termination by Executive**. Executive may voluntarilyterminate employment at any time by giving at least ninety (90) daysprior written notice to Employer. In such event, Employer shall have nofurther obligation hereunder, except that Executive shall receive allcompensation and other benefits in which he was vested or to which he wasotherwise entitled under Section 4 and the plans and programs providedtherein, by reason of his employment through the Termination Date.
     (iv) **Suspension or Termination required by Regulatory Agencies.**
(a) If Executive is suspended and/or temporarilyprohibited from participating in the conduct of Employer’s orany of Employer’s affiliates’ affairs by a regulatory agency,Employer’s obligations under the Agreement shall be suspendedas of the date of service of the notice unless stayed byappropriate proceedings. If the charges in the notice aredismissed, the Employer shall: (1) pay Executive all of thecompensation withheld while its obligations under thisAgreement were suspended; and (2) reinstate any of itsobligations which were suspended.
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(b) If Executive is removed and/or permanentlyprohibited from participating in the conduct of Employer’s orany of Employer’s affiliates affairs by an order issued by aregulatory agency, the obligation of Employer under theAgreement shall terminate as of the effective date of theorder, but earnedor otherwise vested rights of Executive to compensation andto any benefits under Section 4 shall not be affected. (c) All obligations under the Agreement may beterminated, except to the extent determined that continuationof the contract is necessary to operation of Employer or anyof its affiliates, at the time the Federal Deposit InsuranceCorporation (“FDIC”) enters into an agreement to provideassistance to or on behalf of Employer or any of Employer’saffiliates under the authority contained in Section 13(c) ofthe Federal Deposit Insurance Act, or when Employer or any ofits affiliates is determined by any appropriate bankregulatory agency to be in an unsafe or unsound condition.Any rights of the parties that have been already earned orotherwise vested, however, shall not be affected by suchaction.
     (v) **Termination by Executive Due to Diminished Responsibilities orCompensation.**Executive may at any time within twelve (12) monthsfollowing one of the following events outlined below in Sections 5 (v)(a), (b), (c), (d) or (e) terminate his employment under this Agreementby giving at least ninety (90) days prior written notice to Employer, andbe entitled to the benefits described in Section 5 (vi) below:
(a) Executive is assigned to positions, duties or responsibilitiesthat are substantially less significant than the positions, dutiesand responsibilities provided herein;
(b) Executive is removed from or Employer fails to re-elect orre-appoint Executive to his position, except in connection withtermination of Executive’s employment for cause, disability orretirement, or in connection with suspension or termination by orpursuant to regulatory action;
(c) Executive’s Base Salary is reduced other than as the result ofa program applied on a proportionately equivalent basis to allexecutives of Employer and its affiliates;
(d) Executive is required to commute more than forty (40) miles tohis principal place of business; or
     (e) Employer provides written notice that the term of the Agreementshall not be extended in accordance with Section 2, except in the eventthat such notice is given in
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connection with a determination by theEmployer that the Executive has acted or has failed to act in a mannerconstituting Cause under Section 5(ii) of this Agreement.
     (vi) **Benefits Upon Other Termination by Employer.**If Executiveterminates this Agreement in accordance with Section (v), or if thisAgreement is terminated by Employer other than for death, disability orretirement under Section 5(i) and other than for “Cause” under Section 5(ii) or other than byregulatory action under Section (iv), then following the TerminationDate, Executive shall be entitled to the following benefits:
(a) In lieu of any further salary payments, Executiveshall receive severance payments equal to the sum of the BaseSalary in effect on the Termination Date plus cash bonus forthe year prior to termination times the number of full orpartial years remaining in the Employment Term, payable in theamount and at the times provided in Sections 4(i) and (ii).If termination follows a “change in control” as defined inSubsection 4(iii)(d), Executive may elect to receive thepayments specified in the immediately preceding sentence in alump sum without any discount by filing the election in theform set forth in Exhibit A at least twelve (12) months beforethe date of such a change in control; provided, however, thatif the termination follows a “change in control” as defined inSubsection 4(iii)(d), the amount of such severance paymentsmay not exceed the limitations established below in Section 6. (b) In addition to other amounts payable to Executiveunder this Subsection 5(vi), Executive shall be entitled toreceive all other benefits in which he was vested or to whichhe was otherwise entitled under Section 4 and the plans andprograms provided therein by reason of employment through theTermination Date, together with the continuation, without costto Executive, of other benefits under Section 4(iv) for theremaining unexpired Employment Term, subject to thelimitations set forth in Section 6 below if the Executive isterminated following a “change in control” as defined inSubsection 4(iii)(d).
     (vii) **Suspension by Employer**. Board in its sole discretion shallhave the right to temporarily suspend Executive from participating in theconduct of the Employer’s or Employer’s affiliates’ affairs. IfExecutive is suspended or temporarily prohibited from participating inthe conduct of Employer’s or Employer’s affiliates’ business, Employershall pay Executive all compensation and provide all benefits pursuant toSection 4 of this Agreement during the period of such suspension.
     6. **Limitations on Change in Control Compensation**. In the event severancebenefits under Subsection 5(vi) or severance benefits in the event of theExecutive’s disability
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under Subsection 5(i) (together, the “SpecifiedSeverance Benefits”), or any other payments or benefits received or to bereceived by Executive from Employer or Bank (whether payable pursuant to theterms of this Agreement, any other plan, agreement or arrangement with Employeror any corporation (“Affiliate”) affiliated with employer within the meaning ofSection 1504 of the Internal Revenue Code of 1986 as amended (the “Code”)),constitute, in the opinion of tax counsel selected by Employer’s independentauditors and acceptable to Executive, “parachute payments” within the meaningof Section 280G(b)(2) of the Code, and the present value of such “parachute payments” equals or exceeds three times theaverage of the annual compensation payable to Executive by Employer (or anAffiliate) and includible in Executive’s gross income for federal income taxpurposes for the five (5) calendar years preceding the year in which a changein ownership occurred (“Base Amount”), the Specified Severance Benefits shallbe reduced to an amount the present value of which (when combined with thepresent value of any other payments otherwise received or to be received byExecutive from Employer (or an Affiliate) that are deemed parachute payments”)is equal to 2.99 times the Base Amount, notwithstanding any other provision tothe contrary in this Agreement; provided, however, that the Specified SeveranceBenefits shall not be reduced if they are payable as a result of thetermination of the Executive’s employment in accordance with Section 5(v) or ifthey are a result of the Executive’s termination by the Employer without Cause.The Specified Severance benefits shall not be reduced if (i) Executive shallhave effectively waived his receipt or enjoyment of any such payment or benefitwhich triggered the applicability of this Section 6, or (ii) in the opinion oftax counsel, the Specified Severance Benefits (in their full amount or aspartially reduced, as the case may be) plus all other payments or benefitswhich constitute “parachute payments” within the meaning of Section 280OG(b)(2)of the Code are reasonable compensation for services actually rendered, withinthe meaning of Section 28OG(b)(4) of the Code and such payments are deductibleby Employer. The Base Amount shall include every type and form of compensationincludible in Executive’s gross income in respect of his employment by Employer(or an Affiliate), except to the extent otherwise provided in temporary orfinal regulations promulgated under Section 28OG(b) of the Code. For purposesof this Section 6, a “change in ownership or control” shall have the meaningset forth in Section 28OG(b) of the Code and any temporary or final regulationspromulgated thereunder. The present value of any non-cash benefit or anydeferred cash payment shall be determined by Employer’s independent auditors inaccordance with the principles of Section 28OG of the Code.
     Executive shall have the right to request that Employer obtain a rulingfrom the Internal Revenue Service (“Service”) as to whether any or all paymentsor benefits determined by such tax counsel are, in the view of the Service,“parachute payments” under 280G. If a ruling is sought pursuant to Executive’srequest, no Specified Severance Benefits payable under this Agreement in excessof the Section 28OG limitation shall be made to Executive until after fifteen(15) days from the date of such ruling; however, severance benefits shallcontinue to be paid during this time up to the amount of that limitation. Forpurposes of this Section 6, Executive and Employer agree to be bound by theService’s ruling as to whether payments constitute “parachute payments” underSection 280G. If the Service declines, for any reason, to provide the rulingrequested, the tax counsel’s opinion provided with respect to what payments orbenefits constitute “parachute payments” shall control, and the period duringwhich the severance benefits
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may be deferred shall be extended to a datefifteen (15) days from the date of the Service’s notice indicating that noruling will be forthcoming.
     **7. Waiver of Change in Control Salary Continuation Benefits.**Inconnection with this Agreement, Executive agrees that, for purposes of theAmended and Restated Wisconsin State Bank Salary Continuation Agreement by andbetween Executive and the Bank dated March 6, 2002 (the “SCA”), the acquisitionof the Bank by the Employer, in accordance with the Merger Agreement (the “Acquisition”), shall not constitute a Change ofControl. Therefore, the Executive acknowledges that he is not entitled to thebenefits under Section 2.4 of the SCA as a result of the Acquisition.Executive and Employer agree that the benefits under Section 2.4 of the SCAremain available to Executive upon a Change in Control (as such term is definedin the SCA, except that “Company” in the SCA shall have the same meaning as“Company” in this Agreement) or upon a change in control as defined insubsection 4(iii)(d) of this Agreement (in either instance, a “Second Change inControl”).
     Employer acknowledges that this Agreement does not supersede the SCA.Except as provided in this paragraph, Employer agrees that in no event shallExecutive lose any of the benefits to which he is entitled under the SCAwithout the consent of the Executive. Employer agrees that in the event theExecutive is entitled to benefits under Section 2.2 or 2.3 of the SCA as aresult of the Executive’s termination of employment during the fourth quarterof the calendar year, for purposes of determining the benefit payable toExecutive under the SCA and its accompanying Schedule A, the Executive’stermination shall be deemed to occur on January 2nd of the year following theExecutive’s termination of employment.
     Employer agrees that the salary continuation payments to which theexecutive is entitled under the SCA shall in no event be subject to thelimitations above in Section 6 of this Agreement. Upon a Second Change inControl, Employer agrees that the insurance policies purchased to fund the SCAor an equivalent amount of cash consideration will be deposited in a rabbitrust in the form provided in Revenue Procedure 92-64 or any successor guidanceissued by the Internal Revenue Service, which shall be administered by anindependent trustee, and which shall pay benefits owing to Executive under theSCA if the Company or its successor fails to do so.
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     8. **General Provisions**.
     (i) **Successors; Binding Agreement**.
 (a) Employer will require any successor (whetherdirect or indirect, by purchase, merger, consolidation orotherwise) to substantially all of the business and/or assetsof Employer (“Successor Organization”) to expressly assume andagree to perform this Agreement in the same manner and to thesame extent that Employer would have been required to performif no such succession had taken place. If such succession isthe result of a “change in control” as defined herein, suchassumption shall specifically preserve to Executive, for thethen remaining term of this Agreement, the same rights andremedies (recognizing them as being available and applicableas the result of the “change in control” effectuating saidsuccession) provided under this Agreement upon a “change incontrol.”    As used in this Agreement, Employer shall include anysuccessor to the Employer’s business and/or assets, whichbecomes bound by the terms and provisions of this Agreementby operation of this Agreement or by law. Failure ofEmployer to obtain such agreement prior to the effectivenessof any such succession shall be a breach of this Agreementand shall entitle Executive to compensation from Employer inthe same amount and on the same terms as he would be entitledto under this Agreement if he terminated his employment underSection 5(vi). For purposes of implementing the foregoing,the date on which any such succession becomes effective shallbe deemed the Termination Date.  (b) No right or interest to or in any payments orbenefits under this Agreement shall be assignable ortransferable in any respect by the Executive, nor shall anysuch payment, right or interest be subject to seizure,attachment or creditor’s process for payment of any debts,judgments, or obligations of Executive.  (c) Any rights and obligations of Employer under thisagreement may be assigned or transferred by Employer to any ofits affiliates prior to a change in control as defined in thisAgreement.  (d) This Agreement shall be binding upon and inure tothe benefit of and be enforceable by Executive and his heirs,beneficiaries and personal representatives and Employer andany successor organization or assignee of Employer.
     (ii) **Non-competition/Non-solicitation/Confidentiality Provisions**.
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     Executive acknowledges that the development of personal contacts andrelationships is an essential element of Employer’s and Employer’saffiliates’ business, that Employer has invested considerable time andmoney in his development of such contacts and relationships, thatEmployer and its affiliates could suffer irreparable harm if he were toleave Employer’s employment and solicit the business of customers ofEmployer or Employer’s affiliates and that it is reasonable to protectEmployer against competitive activities by Executive. Executivecovenants and agrees, in recognition of the foregoing and inconsideration of the mutual promises contained herein, that in the eventof a termination of his employment with Employer or any of itsaffiliates, Executive shall not accept employment with any SignificantCompetitor of Employer or of any of Employer’s affiliates for a period ofeighteen (18) months following such termination. For purposes of thisAgreement, the term “Significant Competitor” means any financialinstitution including, but not limited to, any commercial bank, savingsbank, savings and loan association, credit union, or mortgage bankingcorporation which, at the time of termination of Executive’s employmentwith Employer or during the period of this covenant not to compete, has ahome, branch or other office within a fifty (50) mile radius of anyoffice operated or maintained by Employer or any of Employer’saffiliates.
     Executive agrees that the non-competition provisions set forthherein are necessary for the protection of Employer and its affiliatesand are reasonably limited as to (a) the scope of activities affected,(b) their duration and geographic scope, and (c) their effect onExecutive and the public. In the event Executive violates thenon-competition provisions set forth herein, Employer shall be entitled,in addition to its other legal remedies, to enjoin the employment ofExecutive with any Significant Competitor for the period set forthherein. If Executive violates this covenant and Employer brings legalaction for injunctive or other relief, Employer shall not, as a result ofthe time involved in obtaining such relief, be deprived of the benefit ofthe full period of the restrictive covenant. Accordingly, the covenantshall be deemed to have the duration specified herein, computed from thedate relief is granted, but reduced by any period between commencement ofthe period and the date of the first violation.
     Executive acknowledges that as a result of his employment withEmployer or its affiliates Executive has access to confidentialinformation concerning Employer’s business, customers and services.Executive agrees that during the Employment Term or subsequent thereto,he will not, directly or indirectly, whether in original, duplicated,computerized or other form, use, disclose or divulge to any person,agency, firm, corporation or other entity any confidential or proprietaryinformation, including, without limitation, customer lists, reports,files, manuals, training materials, records or information of any kind,or any other secret or confidential information pertaining to theproducts, services, customers or prospective customers, sales, technologyand business affairs or methods of Employer or any of its affiliates(collectively “Confidential Information”) which Executive acquires or hasaccess to during the Employment Term. Notwithstanding the foregoing,Confidential Information shall not include information or data which isotherwise available in the public domain. Executive agrees that he willnot at any time either during or subsequent to his employment withEmployer disclose or

 

transmit, either directly or indirectly, any ConfidentialInformation of Employer or its affiliates to any person, firm,corporation, association, or other entity, and will not remove thisinformation, in any form whatsoever, from the premises or data base ofEmployer or its affiliates, except as required in the ordinary course ofbusiness as is necessary to perform Executive’s duties or as required byapplicable law. In the event of Executive’s termination from employmentfrom Employer for any reason, Executive shall immediately return allConfidential Information of Employer, including any original,computerized or duplicated records to Employer.
     Executive agrees that during the term of his employment withEmployer, and for a term of eighteen (18) months thereafter, he will not,directly or indirectly, on behalf of himself or on behalf of any otherindividual or entity, as an agent or otherwise contact, influence orencourage any of the customers of Employer, of which Executive hasknowledge or based on his capacity of employment for Employer or itssubsidiaries should reasonably have had knowledge, for the purpose ofsoliciting business or inducing such customer to acquire any product orservice that is provided or under development by Employer or itsaffiliates from any entity other than Employer.
     Executive agrees that during the term of his employment withEmployer, and for a period of eighteen (18) months thereafter, he willnot, directly or indirectly, encourage, induce, or entice any employee ofEmployer or its affiliates to leave the employment of Employer or itsaffiliates.
     Executive agrees that if he violates the covenants under thissection, Employer shall be entitled to an accounting and repayments ofall profits, compensation, commissions and other remuneration or benefitswhich the Executive has realized or may realize as the result of or inconnection with any such violation. Executive further agrees that moneydamages may be difficult to ascertain in case of a breach of thiscovenant, and Executive therefore agrees that Employer or its affiliatesshall be entitled to injunctive relief in addition to any other remedy towhich Employer or its affiliates may be entitled.
     (iii) **Notice**. All notices and other communications provided for inthis Agreement shall be in writing and shall be deemed duly given whendelivered or mailed by United States registered mail, return receiptrequested, postage prepaid, addressed in the case of Employer to itsprincipal office and in the case of Executive, to his address appearingon the records of Employer or to such other address as either party mayhave furnished to the other in writing in accordance herewith.
     (iv) **Expenses**. If legal proceedings are necessary to enforce orinterpret this Agreement, or to recover damages for breach, theprevailing party shall be entitled to recover reasonable attorneys’ fees,costs and disbursements of such proceedings, in addition to any otherrelief to which such prevailing party may be entitled. Notwithstanding,the foregoing, in the event of legal proceedings to enforce or interpretthis Agreement following a “change in control,” Executive shall beentitled to recover from Employer: (a) reasonable attorneys fees, costs,and disbursements if Executive is

 

the prevailing party; or (b) reasonable attorneys’ fees, costs anddisbursements of up to $7,500 incurred in such proceedings regardless ofwhether Executive is the prevailing party. Recovery of attorneys’ feesand costs following a “change in control” shall be in addition to anyother relief to which Executive is entitled.
     (v) **Withholding**. Employer shall be entitled to withhold fromamounts to be paid to Executive under this Agreement any federal, state,or local withholding or other taxes or charges which it is from time totime required to withhold. Employer shall be entitled to rely on anopinion of counsel as to the amount or requirement of any suchwithholding.
     (vi) **Miscellaneous**. No provision of this Agreement may be amended,waived or discharged unless such amendment, waiver or discharge is agreedto in writing and duly executed by Executive and Employer or itssuccessor in interest. The validity, interpretation, construction andperformance of this Agreement shall be governed by the laws of the Stateof Wisconsin.
     (vii) **Validity**. The invalidity or unenforceability of any provisionof this Agreement shall not affect the validity or enforceability of anyother provision of this Agreement, which shall remain in full force andeffect.
     (viii) **Counterparts**. This Agreement may be executed in severalcounterparts, all of which together will constitute one and the sameinstrument.
     (ix) **Headings**. Headings contained in this Agreement are forreference only and shall not affect the meaning or interpretation of anyprovision of this Agreement.
     (x) **Effective Date**. The effective date of this Agreement shall bethe date indicated in the first paragraph of this Agreementnotwithstanding the actual date of execution by any party.

 

     **INWITNESS WHEREOF,** the undersigned have duly executed this Agreement asof the date first above written.    **JEFFREY A. MUELLER**    /s/ Jeffrey A. Mueller      **MERCHANTS AND MANUFACTURERS** **BANCORPORATION, INC.**    /s/ Michael J. Murry   By: Michael J. Murry Title: Chairman of the Board of Directors