EX-10.2



 







Exhibit 10.2




AMENDED AND RESTATED ADVISORY SERVICE AGREEMENT




     This Amended and Restated Advisory Service Agreement (“Agreement”) is made as of this
31st day of March, 2006, by and between Webster Bank, National Association (the
“Advisor”), a national banking association, and Webster Preferred Capital Corporation (“WPCC”), a
Connecticut corporation, both in Waterbury, Connecticut.



WITNESSETH THAT:




     WHEREAS, WPCC is a “real estate investment trust” (“REIT”) under the Internal Revenue Code of
1986, as amended (the “Code”);



     WHEREAS, WPCC desires to obtain from the Advisor various advisory and management services to
avail itself of the experience and assistance of the Advisor and to have the Advisor undertake, on
WPCC’s behalf, the duties and responsibilities hereinafter set forth, subject to the control and
supervision of the Board of Directors of WPCC as provided for herein; and



     WHEREAS, the Advisor desires to render such advisory and management services to the Company
subject to the control and supervision of the Board of Directors of WPCC, on the terms and
conditions hereinafter set forth.



     NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth
and other good and valuable consideration, the parties hereby agree as follows:




	1.	 	TERM.





     The term of this Agreement shall commence as of March 31, 2006 and shall continue until March
31, 2008. Unless a notice to terminate this Agreement is sent by either party to the other party
at least ninety (90) days prior to March 31, 2008, this Agreement shall be automatically renewed
for a one-year period. Thereafter, the Agreement shall continue to be automatically renewed for
successive one-year periods unless a termination notice is sent by either party to the other party
at least ninety (90) days prior to the end of the then existing renewal term.




	2.	 	ADVISORY SERVICES.





     The Advisor shall consult with the Board of Directors and the officers of WPCC and shall, at
the request of the Board of Directors and/or the officers of WPCC, furnish advice and
recommendations with respect to all aspects of the business and affairs of WPCC. Subject to the
control and discretion and at the request of the Board of Directors of WPCC, the Advisor shall



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provide the following services (together with the services set forth in Section 6 and Section 7
hereof, the “Services”):




	 	(a)	 	administer the day-to-day operations and affairs of WPCC, including, without
limitation, the performance or supervision of the functions described in this Section 2;
	 
	 	(b)	 	monitor the credit quality of the real estate mortgage assets held by WPCC;
	 
	 	(c)	 	advise WPCC with respect to the acquisition, management, financing and
disposition of WPCC’s real estate mortgage assets;
	 
	 	(d)	 	establish and provide necessary services for WPCC, including executive,
administrative, human resource, accounting and control, technical support, secretarial,
recordkeeping, copying, mailing and distribution facilities;
	 
	 	(e)	 	provide WPCC with office space pursuant to a lease, conference room facilities,
office equipment and supplies (including computers, copy machines and fax machines) and
personnel necessary for the Services to be performed by the Advisor hereunder and to
perform the daily business of WPCC;
	 
	 	(f)	 	arrange for the investment and management of any short-term investments of WPCC
and provide any investment and fund management services in a manner consistent with
Exhibit D to the Master Service Agreement, dated March 31, 2006, between the Advisor and
WPCC;
	 
	 	(g)	 	monitor and supervise the performance of all parties who have contracts to
perform services for WPCC, provided that the Advisor shall have no duty to assume the
obligations or guarantee the performance of such parties under such contracts;
	 
	 	(h)	 	establish and maintain such bank accounts in the name of WPCC as may be required
by WPCC and approved by the Board of Directors of WPCC and ensure that all funds
collected by the Advisor in the name of or on behalf of WPCC shall be held in trust and
shall not be commingled with the Advisor’s own funds or accounts;
	 
	 	(i)	 	arrange for the execution and delivery of such documents and instruments by the
officers of WPCC as may be required in order to perform the functions herein described
and to take any other required action contemplated by the terms of this Agreement;
	 
	 	(j)	 	arrange for insurance for WPCC, including liability insurance, errors and
omissions policies and officers and directors policies, which shall cover and insure
WPCC, members of the Board of Directors and the officers of WPCC in amounts and with
deductibles and insurers approved by the Board of Directors of WPCC;




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	 	(k)	 	maintain proper books and records of WPCC’s affairs and furnish or cause to be
furnished to the Board of Directors such periodic reports and accounting information as
may be required from time to time by the Board of Directors of WPCC, including, but not
limited to, quarterly reports of all income, expenses and distributions of WPCC;
	 
	 	(l)	 	consult and work with legal counsel for WPCC in implementing WPCC decisions and
undertaking measures consistent with all pertinent federal, state and local laws and
rules or regulations of governmental or quasi-governmental agencies, including, but not
limited to, federal and state securities laws, the Code (as it relates to WPCC’s
qualification as a REIT), and the regulations promulgated under or by each of the
foregoing;
	 
	 	(m)	 	consult and work with independent accountants for WPCC in connection with the
preparation of financial statements, annual reports and tax returns;
	 
	 	(n)	 	prepare and distribute in consultation with the independent accountants for WPCC,
annual reports to stockholders which contain audited financial statements;
	 
	 	(o)	 	furnish reports to the Board of Directors of WPCC, including reports concerning
WPCC’s investments;
	 
	 	(p)	 	maintain custody of the documents related to WPCC’s mortgage assets; and
	 
	 	(q)	 	as reasonably requested by WPCC, make reports to WPCC regarding the provision of
the foregoing Services and furnish advice and recommendations with respect to other
aspects of the business of WPCC.






	3.	 	OPERATING EXPENSES; EXPENSES OF THE ADVISOR.





     (a) “Operating Expenses” for any period means all of the operating expenses of WPCC (with the
exception of those expenses to be borne by the Advisor in accordance with Section 3(b) hereof),
including, without limitation, the following:




	 	(i)	 	interest, taxes and other expenses incurred in connection with the
real estate mortgage assets of WPCC;
	 
	 	(ii)	 	expenses related to the officers, directors and employees of WPCC,
including, without limitation, any fees or expenses of the directors;
	 
	 	(iii)	 	fees and expenses payable to accountants, appraisers, external
auditors, consultants, attorneys, collection and paying agents and all other
persons who contract with or are retained by WPCC or by the Advisor on behalf of
WPCC;




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	 	(iv)	 	legal and other expenses incurred in connection with advice
concerning obtaining or maintaining WPCC’s status as a REIT, the determination of
WPCC’s taxable income, any formal or informal administrative action or legal
proceedings which involve a challenge to the REIT status of WPCC or any claim
that the activities of WPCC, any member of the Board of Directors or any
officer of WPCC were impermissible or otherwise improper;
	 
	 	(v)	 	expenses relating to communications with and reports to
stockholders of WPCC, including, without limitation, the costs of preparing,
printing, duplicating and mailing the certificates for the stock of WPCC, proxy
solicitation materials and reports to stockholders, and the costs of arranging
meetings of stockholders;
	 
	 	(vi)	 	the costs of insurance described in Section 2 hereof, including,
without limitation, directors and officers liability insurance covering the
directors and officers of WPCC;
	 
	 	(vii)	 	expenses relating to the acquisition, disposition and ownership of
the real estate mortgage assets of WPCC, including, without limitation and to the
extent not paid by others, legal fees and other expenses for professional
services and fees;
	 
	 	(viii)	 	expenses connected with the payments of dividends or interest, or distributions
in cash or any other form, made or caused to be made by the Board of Directors to
the stockholders of WPCC;
	 
	 	(ix)	 	expenses connected with any office or office facilities that are
maintained by WPCC separate from the office of the Advisor, including, without
limitation, rent, telephone, utilities, office furniture and equipment and
machinery; and
	 
	 	(x)	 	other miscellaneous expenses of WPCC which are not expenses of the
Advisor under Section 3(b) hereof.





     (b) Without regard to the compensation received pursuant to Section 4 hereof, the Advisor
shall bear the following expenses:




	 	(i)	 	employment expenses of the personnel employed by the Advisor,
including, without limitation, salaries, wages, payroll taxes and the cost of
employee benefit plans; and
	 
	 	(ii)	 	rent, telephone equipment, utilities, office furniture and
equipment and machinery and other office expenses of the Advisor incurred in
connection with the maintenance of any office facility of the Advisor.





     (c) WPCC shall reimburse the Advisor within 30 days of a written request by the Advisor for
any Operating Expenses paid or incurred by the Advisor on behalf of WPCC.



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	4.	 	FEES.





     (a) An
annual advisory fee of
$195,000 shall be payable by WPCC to the Advisor for Services
rendered by the Advisor hereunder. Payment by WPCC is due and payable monthly upon receipt of an
invoice from the Advisor.



     (b) The Advisor may revise the rate set forth in Paragraph 4(a) above to reflect changes in
the actual costs incurred by the Advisor in providing the Services to WPCC or to reflect the market
price, in the aggregate, for the Services provided by the Advisor pursuant to this Agreement.




	5.	 	PERFORMANCE OF SERVICES; CHANGES.





     (a) In performing Services under this Agreement, the scope of work undertaken by the Advisor
and the manner of its performance shall be substantially the same as for similar work performed by
the Advisor for transactions on its own behalf, with such modifications as may be appropriate in
order to accomplish the purposes of this Agreement.



     (b) The Advisor shall give WPCC reasonable notice of all changes affecting WPCC’s activities
as these changes pertain to the Services. If a change referred to in Paragraph 5(a) above
(including a revision of the annual advisory fee pursuant to Section 4(b) hereof) is not acceptable
to WPCC, WPCC may terminate this Agreement upon thirty (30) days’ notice, provided such notice is
given within ten (10) days after WPCC has received notice of the change.




	6.	 	MAINTENANCE OF RECORDS; EXAMINATIONS.





     The Advisor shall at all times, establish and maintain appropriate books of account, records
and accounting practices related to the Services performed hereunder and permit such examinations
as may be required by relevant state and federal agencies. Such books and records shall be
accessible for inspection by the Board of Directors of WPCC and representatives of WPCC at all
times. It is understood and agreed that the performance of the Services may be subject to
regulation and examination by authorized representatives of state and federal agencies, including,
but not limited to, the Office of the Comptroller of the Currency, the Board of Governors of the
Federal Reserve System and the Federal Deposit Insurance Corporation, or state regulatory agencies,
to the extent their authority is not preempted by federal law or regulation. Each party is and
shall be authorized to submit or furnish to any such regulatory agency reports, information,
assurances and other data as may be required by or reasonably requested of it under applicable laws
and regulations, including, without limitation, any appropriate notifications concerning the
initiation or termination of this Agreement or any of the Services provided to WPCC.




	7.	 	REIT QUALIFICATION AND COMPLIANCE.





     The Advisor shall consult and work with WPCC’s legal counsel in maintaining WPCC’s
qualification as a REIT. Notwithstanding any other provisions of this Agreement to the



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contrary, the Advisor shall refrain from any action which, in its reasonable judgment or in the
judgment of the Board of Directors of WPCC (of which the Advisor has received written notice),
would adversely affect the qualification of WPCC as a REIT or which would violate any law, rule or
regulation of any governmental body or agency having jurisdiction over WPCC or its securities, or
which would otherwise not be permitted by the amended and restated certificate of incorporation or
by-laws of WPCC. Furthermore, the Advisor shall take any action which, in its judgment or the
judgment of the Board of Directors of WPCC (of which the Advisor has received written notice), may
be necessary to maintain the qualification of WPCC as a REIT or prevent the violation of any law or
regulation of any governmental body or agency having jurisdiction over WPCC or its securities.





	8.	 	SUBCONTRACTING.





     The Advisor may at any time subcontract all or a portion of its obligations under this
Agreement to one or more affiliates of the Advisor that are involved in the business of managing
real estate mortgage assets without the consent of WPCC. If no affiliate of the Advisor is engaged
in the business of managing real estate mortgage assets, the Advisor may, with the approval of a
majority of the Board of Directors of WPCC, subcontract all or a portion of its obligations under
this Agreement to unrelated third parties. Notwithstanding the foregoing, the Advisor will not, in
connection with subcontracting any of its obligations under this Agreement, be discharged or
relieved in any respect from its obligations under this Agreement.




	9.	 	OTHER ACTIVITIES OF THE ADVISOR.





     (a) Nothing contained herein shall prevent the Advisor, an affiliate of the Advisor or an
officer, director, employee or stockholder of the Advisor from engaging in any activity, including,
without limitation, originating, purchasing and managing real estate mortgage assets, rendering of
services and investment advice with respect to real estate investment opportunities to any other
person (including other REITs) and managing other investments (including the investments of the
Advisor and its affiliates).



     (b) Officers, directors, employees, stockholders and agents of the Advisor or of any affiliate
of the Advisor may serve as officers, directors, employees or agents of WPCC, but shall receive no
compensation (other than reimbursement for expenses) from WPCC for such service.




	10.	 	LIMITATIONS OF LIABILITY.





     The Advisor shall use its best efforts to provide competent personnel and reliable equipment
for the purpose of performing Services for WPCC under this Agreement. The liability of the Advisor
to WPCC for any loss due to the Advisor’s performing or failing to perform the Services shall be
limited to those losses sustained by WPCC which are a direct result of the Advisor’s gross
negligence or willful misconduct. Because of the nature of the Services to be performed hereunder
and because of the impracticability, difficulty or impossibility of ascertaining and measuring the
Advisor’s liability to WPCC for any loss or damage by reason of any error caused by the Advisor’s
negligence or otherwise, the parties hereby agree that under no



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circumstances shall the Advisor be liable for any consequential or special damages, and in no event shall the Advisor’s total combined
liability to WPCC for all claims arising under or in
connection with this Agreement be more than the total amount of all fees payable by WPCC to the
Advisor under this Agreement during the year immediately preceding the year in which the first
claim giving rise to any such liability arises. For purposes of this Section 10, a “year” shall be
deemed to begin on October 20th and run until October 19th of the ensuing calendar year. If the
Advisor carries insurance against the type of loss incurred, WPCC agrees to cooperate in furnishing
proof of loss in a form satisfactory to the Advisor’s insurance company and to assist the Advisor
and its insurance company in settlement of this claim.





	11.	 	FORCE MAJEURE.





     Neither party shall be responsible for any resulting loss if fulfillment of any term or
provision of this Agreement is delayed or prevented by fire, flood, earthquake, act of God, labor
difficulties or by any other cause not within the control of the party whose performance is delayed
or prevented. If the foregoing shall occur and such situations shall continue to prevent
performance for a continuous period of sixty (60) days, then either party may notify the other
party of its intention to terminate this Agreement and this Agreement shall terminate upon receipt
of such notice.




	12.	 	DEFAULT; REMEDIES.





     (a) The occurrence of any of the following shall be an event of default (“Event of Default”)
hereunder:




	 	(i)	 	the failure of WPCC to pay any fee or charge within 30 days after
its receipt of an invoice or written request for reimbursement from the Advisor
for fees or expenses reimbursable hereunder;
	 
	 	(ii)	 	the filing of a petition in bankruptcy by or against either party
or the appointment of a receiver for either party which petition or appointment
is not discharged within thirty (30) days; or
	 
	 	(iii)	 	a material breach by either party of any of its obligations
hereunder.





     (b) In the event of any Event of Default, the non-breaching party shall provide a written
notice of such Event of Default and a demand that such Event of Default be cured. In the event
that the breaching party fails in good faith to cure such Event of Default within fifteen (15) days
following receipt of such notice and demand, the non-defaulting party may terminate this Agreement
by notice to the defaulting party.



     (c) In the event of a termination by either party pursuant to this Section 12(b), WPCC shall
nonetheless remain liable for the payment to the Advisor of all reasonable outstanding fees and
charges as of the date of such termination.



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	13.	 	INDEPENDENT CONTRACTOR.





     In performing the Services, the Advisor shall be deemed to have an independent contractual
relationship with WPCC and shall not be deemed to have any contractual or other relationship with
WPCC’s mortgagors. Nothing in this Agreement shall be deemed to create a joint venture or
partnership between the parties. In no event shall any of WPCC’s mortgagors be considered a third
party beneficiary of this Agreement. To the extent that third parties may make claims against the
Advisor arising out of the Services provided hereunder, WPCC agrees to indemnify and hold harmless
the Advisor from and against all loss, liability, claim, action, demand, or suits, including
attorney’s fees arising therefrom.




	14.	 	RELATIONSHIP OF PARTIES; ASSIGNMENT.





     Each of the parties hereto hereby acknowledges that it is an affiliate of the other party
hereto. WPCC shall not assign this Agreement nor any of its rights or obligations hereunder
without the prior written consent of the Advisor. The Advisor may assign this Agreement and any of
its rights and obligations (including, without limitation, its obligation to provide Services) to
any affiliate of WPCC. In the event WPCC is no longer an affiliate of the Advisor or its
successors or assigns, this Agreement shall automatically terminate.




	15.	 	SEVERABILITY.





     Whenever possible, each provision of the Agreement shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be in effect only to the extent
of such prohibition or invalidity, without invalidating the remainder of the provisions of this
Agreement.




	16.	 	CONFIDENTIALITY.





     The Advisor shall regard and preserve as confidential all data of a proprietary and/or
confidential nature related to the business of WPCC. The Advisor will take the same precautions to
preserve such confidential information as it takes with respect to the Advisor’s own confidential
information.




	17.	 	NOTICES.





     All notices to be sent under this Agreement shall be mailed by first class mail, postage
prepaid and addressed as follows:



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	If to the Advisor:

	 	Harriet Munrett Wolfe
	 

	 	Executive Vice President, General Counsel and Secretary
	 

	 	Webster Bank, National Association
	 

	 	Webster Plaza
	 

	 	145 Bank Street
	 

	 	Waterbury, CT 06702
	 
	 	 
	If to WPCC:

	 	William T. Bromage
	 

	 	President
	 

	 	Webster Preferred Capital Corporation
	 

	 	145 Bank Street
	 

	 	Waterbury, CT 06702





Either party may give written notice to the other to change the place of the mailing of such
notices.





	18.	 	ENTIRE AGREEMENT.





     This Agreement constitutes the entire agreement of the parties hereto. It shall supersede any
and all other previous writings and communications between the parties, including the Advisory
Service Agreement dated October 20, 1997.




	19.	 	COUNTERPARTS.





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




	20.	 	AMENDMENT.





     No modification or amendment of this Agreement shall be valid unless such modification or
amendment is in writing and executed by both parties.




	21.	 	GOVERNING LAW.





     This Agreement shall be governed by, and construed and enforced in accordance with, the laws
of the State of Connecticut.




	22.	 	HEADINGS.





     The section headings herein have been inserted for convenience of reference only and shall not
be construed to affect the meaning, construction or effect of this Agreement.



[Signatures on following page]






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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
authorized representatives as of the date first written above.



	 	 	 	 	 
	 	WEBSTER BANK, NATIONAL ASSOCIATION

 	 
	 	By:  	/s/
James C. Smith	 
	 	 	James C. Smith 	 
	 	 	Chairman and Chief Executive Officer 	 
	 



	 	 	 	 	 
	 	WEBSTER PREFERRED CAPITAL CORPORATION

 	 
	 	By:  	/s/
William T. Bromage	 
	 	 	William T. Bromage 	 
	 	 	President 	 
	 




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