Document:

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                                                                     EXHIBIT 10F

                                                                     Page 1 of 6

                                GATX CORPORATION
                     2004 EQUITY INCENTIVE COMPENSATION PLAN
                      NON-QUALIFIED STOCK OPTION AGREEMENT

PARTICIPANT                                          NAME

NUMBER OF OPTIONS                                    NUMBER

EXERCISE PRICE PER SHARE                             PRICE

GRANT DATE                                           GRANT DATE

EXPIRATION DATE*                                     EXPIRE DATE

*Subject to earlier termination as provided in the attached terms and
conditions.

In partial consideration of the provision of services by the above named
Employee, who currently is employed by GATX Corporation (the "Company"), or a
subsidiary thereof (such subsidiary and the Company hereinafter collectively
"GATX"), and as further incentive to the Employee to advance the interests of
the Company, the Company hereby grants to the Employee NUMBER non-qualified
stock options (the "Option") to purchase an equal number of "Covered Shares" of
common stock of the Company at the per share purchase price (the "Exercise
Price") set forth above, determined by the Compensation Committee (the
"Committee") of the Board of Directors of the Company in accordance with
paragraph 2.2 of the GATX Corporation 2004 Equity Incentive Compensation Plan
(the "Plan"), as amended. The Option is not intended to constitute an "incentive
stock option" as that term is used in Code section 422. Such grant is expressly
subject to the terms and conditions of this Option Agreement as hereinafter set
forth and further subject to the terms and conditions of the Plan, both of which
are incorporated herein by reference.

Other terms used in the Agreement are defined pursuant to paragraph 16 or
elsewhere in this Agreement.

IN WITNESS WHEREOF, the parties have caused this Agreement, consisting of this
page and the two pages of Terms and Conditions attached hereto, to be executed
the date, month and year first above written.

GATX CORPORATION                    PARTICIPANT

By: _________________________          ____________________________
    Chairman and CEO                            NAME

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            1. Date of Exercise. Subject to the terms and conditions of this
     Agreement, each Installment of Covered Shares of the Option shall be
     exercisable on and after the Vesting Date for such Installment as described
     in the following schedule (but only if the Date of Termination has not
     occurred before the Vesting Date):

<TABLE>
<CAPTION>
                                    VESTING DATE APPLICABLE
     INSTALLMENT                        TO INSTALLMENT
--------------------                -----------------------
<C>                                 <C>
50% OF COVERED SHARES                  GRANT DATE + 1 YR
25% OF COVERED SHARES                 GRANT DATE + 2 YRS
25% OF COVERED SHARES                 GRANT DATE + 3 YRS
</TABLE>

            2. Notwithstanding the foregoing provisions of this paragraph 2, the
     Option shall become fully vested and exercisable as follows:

(a)      The Option shall become fully exercisable upon the Date of Termination,
         if the Date of Termination occurs by reason of the Participant's death
         or Disability.

(b)      Only Options which were exercisable immediately prior to the
         Participant's Date of Termination, or became exercisable upon the
         Participant's Date of Termination may be exercised on or after the Date
         of Termination. However, if the Participant is terminated for Cause,
         all Options not exercised prior to the Participant's Date of
         Termination will be cancelled immediately.

(c)      If the Participant's Date of Termination does not occur prior to the
         occurrence of a Change in Control, the Option shall become fully
         exercisable on the date of the Change in Control, subject to the
         following:

         (i)      Upon the occurrence of a Change in Control described in
                  paragraph 5(e) of the Plan with respect to a Participant as
                  described therein (relating to certain transactions involving
                  a subsidiary or business segment), the Installment, if any,
                  scheduled to become exercisable during the calendar year in
                  which such Change in Control occurs shall become exercisable
                  in full for a period beginning on the date on which the Change
                  in Control occurs and ending on the earlier of the end of the
                  calendar year following the consummation of such transaction
                  and the Expiration Date.

         (ii)     If the Option does not provide for a tandem SAR, the
                  Participant shall have a right, during the thirty day period
                  following the occurrence of a Change in Control, to receive
                  from the Company cash in an amount equal to the product of:

                  (A)      the number of Covered Shares which the Participant
                           elects to have canceled under the then exercisable
                           Options; multiplied by

                  (B)      the excess, if any, of the highest of:

                           (I)      the highest reported sales price of the
                                    Stock during the sixty days preceding such
                                    exercise;

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                           (II)     the highest purchase price for the Stock
                                    shown in any Schedule 13D filed with respect
                                    to an acquisition referred to in Section
                                    5(a) of the Plan as paid within the sixty
                                    days prior to the date of such report; or

                           (III)    the cash and value of property paid per
                                    share in any transaction referred to in
                                    Section 5(c) of the Plan;

                           over the Exercise Price.

            3. Expiration. The Option shall not be exercisable after the
     Company's close of business on the last business day that occurs prior to
     the Expiration Date. The "Expiration Date" shall be the earliest to occur
     of:

(a)      the seven-year anniversary of the Grant Date;

(b)      if the Date of Termination occurs by reason of death or Disability, the
         one-year anniversary of such Date of Termination;

(c)      if the Date of Termination occurs for Cause, the Date of Termination;

(d)      if the Date of Termination occurs by reason of Retirement, the
         five-year anniversary of such Retirement;

(e)      if the Date of Termination occurs for any reason other than those
         listed in subparagraph (b), (c), or (d) of this paragraph 3, the
         three-month anniversary of such Date of Termination.

            4. Method of Option Exercise. The Option may be exercised in whole
     or in part by filing a written notice with the Director, Compensation of
     the Company at its corporate headquarters prior to the Company's close of
     business on the last business day that occurs prior to the Expiration Date.
     Such notice shall specify the number of shares of Stock which the
     Participant elects to purchase, and shall be accompanied by payment of the
     Exercise Price for such shares of Stock indicated by the Participant's
     election. Payment shall be by cash or by check payable to the Company.
     Except as otherwise provided by the Committee before the Option is
     exercised, all or a portion of the Exercise Price may be paid by the
     Participant by delivery of shares of Stock owned by the Participant and
     acceptable to the Committee having an aggregate Fair Market Value (valued
     as of the date of exercise) that is equal to the amount of cash that would
     otherwise be required. Except as otherwise provided by the Committee,
     payments made with shares of Stock shall be limited to shares held by the
     Participant for not less than six months prior to the payment date. The
     Option shall not be exercisable if and to the extent the Company determines
     that such exercise would violate applicable state or Federal securities
     laws or the rules and regulations of any securities exchange on which the
     Stock is traded. If the Company makes such a determination, it shall use
     all reasonable efforts to obtain compliance with such laws, rules and
     regulations. In making any determination hereunder, the Company may rely on
     the opinion of counsel for the Company.

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            5. Dividend Equivalents. Participants shall be entitled to receive
     dividend equivalents beginning on the Grant Date and ending upon exercise
     of the Options or the Expiration Date, whichever occurs earlier. An account
     will be established for each participant that will accrue dividend
     equivalents on the Options. The Participant's account shall be credited
     with dividend equivalents equal to the product of (a) the number of Covered
     Shares which the Participant may purchase subject to any adjustment made by
     the Committee as referred to in paragraph 4.2 (f) of the Plan, and (b) the
     dividend declared on a single share of the Company's Common Stock with
     respect to the immediately preceding dividend record date So long as the
     Options have not been cancelled, accrued dividends will be paid as soon as
     practical after the Vesting Date of each Installment of Covered Shares as
     reflected in paragraph 1. Dividend equivalents will be paid within 30 days
     of each quarterly dividend payable date, subject to supplemental
     withholding rates for federal, state and FICA taxes. Dividend equivalents
     will be prorated through the Date of Termination for the quarter in which
     the Date of Termination occurs on vested Covered Shares.

            6. Withholding. All deliveries and distributions under this
     Agreement are subject to withholding of all applicable taxes. At the
     election of the Participant, and subject to such rules and limitations as
     may be established by the Committee from time to time, such withholding
     obligations may be satisfied through the surrender of shares of Stock which
     the Participant already owns, or to which the Participant is otherwise
     entitled under the Plan; provided, however, that, except as otherwise
     provided by the Committee, such shares may be used to satisfy not more than
     the Company's minimum statutory withholding obligation (based on minimum
     statutory withholding rates for Federal and state tax purposes, including
     payroll taxes, that are applicable to such supplemental taxable income).

            7. Transferability. The Option is not transferable other than as
     designated by the Participant by will or by the laws of descent and
     distribution, and during the Participant's life, may be exercised only by
     the Participant.

            8. Heirs and Successors. This Agreement shall be binding upon and
     inure to the benefit of the Company and its successors and assigns, and
     upon any person acquiring, whether by merger, consolidation, purchase of
     assets or otherwise, all or substantially all of the Company's assets and
     business. If any rights exercisable by the Participant or benefits
     deliverable to the Participant under this Agreement have not been exercised
     or delivered, respectively, at the time of the Participant's death, such
     rights shall be exercisable by the Designated Beneficiary, and such
     benefits shall be delivered to the Designated Beneficiary, in accordance
     with the provisions of this Agreement and the Plan. The "Designated
     Beneficiary" shall be the beneficiary or beneficiaries designated by the
     Participant in a writing filed with the Committee in such form and at such
     time as the Committee shall require. If a deceased Participant fails to
     designate a beneficiary, or if the Designated Beneficiary does not survive
     the Participant, any rights that would have been exercisable by the
     Participant and any benefits distributable to the Participant shall be
     exercised by or distributed to the legal representative of the estate of
     the Participant. If a deceased Participant designates a beneficiary and the
     Designated Beneficiary survives the Participant but dies before the
     Designated Beneficiary's exercise of all rights under this Agreement or
     before the complete distribution of

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         benefits to the Designated Beneficiary under this Agreement, then any
         rights that would have been exercisable by the Designated Beneficiary
         shall be exercised by the legal representative of the estate of the
         Designated Beneficiary, and any benefits distributable to the
         Designated Beneficiary shall be distributed to the legal representative
         of the estate of the Designated Beneficiary.

            9. Administration. The authority to manage and control the operation
     and administration of this Agreement shall be vested in the Committee, and
     the Committee shall have all powers with respect to this Agreement as it
     has with respect to the Plan. Any interpretation of the Agreement by the
     Committee and any decision made by it with respect to the Agreement shall
     be final and binding on all persons.

            10. Plan Governs. Notwithstanding anything in this Agreement to the
     contrary, the terms of this Agreement shall be subject to the terms of the
     Plan, a copy of which may be obtained by the Participant from the Director,
     Compensation of the Company; and this Agreement is subject to all
     interpretations, amendments, rules and regulations promulgated by the
     Committee from time to time pursuant to the Plan.

            11. Not An Employment Contract. The Option will not confer on the
     Participant any right with respect to continuance of employment or other
     service with the Company or any Subsidiary, nor will it interfere in any
     way with any right the Company or any Subsidiary would otherwise have to
     terminate or modify the terms of such Participant's employment or other
     service at any time.

            12. Notices. Any written notices provided for in this Agreement or
     the Plan shall be in writing and shall be deemed sufficiently given if
     either hand delivered or if sent by fax or overnight courier, or by postage
     paid first class mail. Notices sent by mail shall be deemed received three
     days after mailing, but in no event later than the date of actual receipt.
     Notices shall be directed, if to the Participant, at the Participant's
     address indicated by the Company's records, or if to the Company, to the
     attention of the Director, Compensation at the Company's principal
     executive office.

            13. Fractional Shares. In lieu of issuing a fraction of a share upon
     any exercise of the Option, resulting from an adjustment of the Option
     pursuant to paragraph 4.2(f) of the Plan or otherwise, the Company will be
     entitled to pay to the Participant an amount equal to the fair market value
     of such fractional share.

            14. No Rights As Shareholder. The Participant shall not have any
     rights of a shareholder with respect to the shares subject to the Option,
     until a stock certificate has been duly issued following exercise of the
     Option as provided herein.

            15. Amendment. This Agreement may be amended in accordance with the
     provisions of the Plan, and may otherwise be amended by written agreement
     of the parties.

            16. Definitions. For purposes of this Agreement, the terms used in
     this Agreement shall be subject to the following:

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(a)      Cause. The term "Cause" shall mean (i) the willful and continued
         failure of the Participant to perform the Participant's duties with the
         Company or one of its affiliates (other than any such failure resulting
         from incapacity due to physical or mental illness), or (ii) the willful
         engaging by the Participant in illegal conduct or gross misconduct
         which is materially and demonstrably injurious to the Company. For
         purposes of this provision, no act or failure to act, on the part of
         the Participant, shall be considered "willful" unless it is done, or
         omitted to be done, by the Participant in bad faith or without
         reasonable belief, that the Participant's action or omission was in the
         best interests of the Company.

(b)      Change in Control. The term "Change in Control" shall have the meaning
         ascribed to it in Section 5 of the Plan.

(c)      Date of Termination. The term "Date of Termination" means the first day
         occurring on or after the Grant Date on which the Participant is not
         employed by the Company (or in the case of a non-employee member of the
         Board of Directors of the Company, a member on the Board) or any
         Subsidiary, regardless of the reason for the termination of employment;
         provided that a termination of employment shall not be deemed to occur
         by reason of a transfer of the Participant between the Company and a
         Subsidiary or between two Subsidiaries; and further provided that the
         Participant's employment shall not be considered terminated while the
         Participant is on a leave of absence from the Company or a Subsidiary
         approved by the Participant's employer.

(d)      Disability. Except as otherwise provided by the Committee, the
         Participant shall be considered to have a "Disability" during the
         period in which the Participant is considered to be "disabled" as that
         term is defined in the Company's long term disability plan.

(e)      Retirement. "Retirement" of the Participant means retirement on a
         "Retirement Date," as that term is defined in the GATX Corporation
         Non-Contributory Pension Plan for Salaried Employees (the "Pension
         Plan"); provided that if the Participant is not a participant in the
         Pension Plan, the Retirement Date shall be the date determined by the
         Committee.

(f)      Plan Definitions. Except where the context clearly implies or indicates
         the contrary, a word, term, or phrase used in the Plan is similarly
         used in this Agreement.

                                       7exv10w1

 

Exhibit 10.1

EMPLOYMENT AGREEMENT

     THIS AGREEMENT is made as of the 12th day of August, 2004, between
MERCHANTS AND MANUFACTURERS BANCORPORATION, INC. (the “Company”), a Wisconsin
corporation, its successors and assigns, and JEFFREY A. MUELLER (the
“Executive”).

RECITALS

     WHEREAS, Executive has been a valued, long-term employee of Wisconsin
State Bank, a state-chartered commercial bank located in Random Lake, Wisconsin
(the “Bank”) that is being acquired by the Company in accordance with the
Amended 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 employment
will benefit the Employer in the future; and

     WHEREAS, Employer desires to provide for management continuity and
stability and for the services of Executive.

AGREEMENT

     NOW, THEREFORE, in consideration of the mutual covenants and agreements
set 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 Section
2.

     2. Term of Employment. The period of Executive’s employment under this
Agreement shall be deemed to have commenced as of the date first above written
and shall continue until December 31, 2008. Commencing on January 1, 2006, and
continuing on the first day of each year thereafter, the Agreement shall
automatically renew for an additional twelve (12) months such that the
remaining term shall be forty-eight (48) months unless written notice is
provided by either party at least sixty (60) days prior to the first day of the
applicable renewal year, that the Agreement shall terminate at the end of
thirty-six (36) months following such renewal date. Prior to the renewal or
non-renewal of the Agreement, the Company’s Board of Directors or the Executive
Personnel/Compensation Committee (either of which shall be the “Board”) will
conduct a performance evaluation of the Executive and the results thereof shall
be included in the minutes of the Board meeting. The term of employment under
this 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 president
and chief executive officer of the Bank. Executive shall provide such
management services as are customarily performed by persons serving in similar
capacities at other banking affiliates of the Company, and perform such other
duties as may be appropriate to his position. Excluding periods of vacation to
which the Executive is entitled, during the Employment Term the Executive
agrees to devote full time and attention to the business and affairs of the
Employer to the extent necessary to discharge the responsibilities assigned to
the Executive hereunder, provided that the Executive may take reasonable
amounts of time to serve on corporate, civil or charitable boards or
committees, if such activities do not significantly interfere with the
performance of the Executive’s responsibilities hereunder. It is expressly
understood and agreed that to the extent any such activities have been
conducted by the Executive prior to the date of this Agreement, the continued
conduct of such activities (or the conduct of activities similar in nature and
scope) subsequent to the date of this Agreement shall not thereafter be deemed
to interfere with the performance of Executive’s responsibilities hereunder.
The Executive agrees to devote substantially all of his business time, efforts
and skills to the performance of his duties and responsibilities under this
Agreement; provided, however, that nothing in this Agreement shall preclude the
Executive from devoting reasonable periods of time required for participating
in certain other businesses in which he has a significant ownership stake; as
long as such participation does not substantially interfere with the
Executive’s regular performance of his duties and responsibilities hereunder.

     4. Compensation. As compensation for services provided pursuant to this
Agreement, Executive shall receive the compensation and other benefits set
forth below:

     (i) Base Salary. During the Employment Term, Executive shall
receive an annual base salary (“Base Salary”) in such amounts as may from
time to time be approved by the Board. The Base Salary in effect as of
the Commencement Date shall be one hundred thirty thousand dollars
($130,000.00). Such amount shall be subject to review and to annual
adjustment by the Board in accordance with Employer’s normal personnel
practices; provided, however, that the Base Salary shall not decrease as
a result of such an annual adjustment. No increase in Base Salary or
other compensation shall limit or reduce any other obligation of
Employer. Executive’s Base Salary and other compensation shall be paid
in accordance with Employer’s regular payroll practices. Review and
adjustment of Executive’s Base Salary shall be done on a basis comparable
to, and applied uniformly with that utilized for other executives of
Employer and/or its affiliates.

     (ii) Bonus Payments. In addition to Base Salary, Executive shall be
entitled, during the Employment Term, to participate in and receive
payments from all bonus and other incentive compensation plans as in
effect from time to time on the same basis as other executive officers of
Employer.

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     (iii) Stock Options.

     (a) On the same date of this Agreement, Executive shall
receive a grant of stock options for 20,000 shares of common stock
of the Company under the Company’s 1996 Incentive Stock Option
Plan, as amended (the “Plan”). The stock option grant shall be of
both incentive stock options and nonstatutory stock options.

     (b) The stock options shall vest on the following vesting
dates: August 12, 2004, December 31, 2005, March 31, 2006 and
March 31, 2007. In order for the maximum amount of the stock
options to qualify as incentive stock options under the Code, the
Employer shall structure the vesting of the stock options such that
the maximum amount of incentive stock options that become
exercisable by the Executive during a calendar year (which shall be
the amount of shares of common stock of the Company with a Fair
Market Value (as defined in the Plan) of $100,000, determined as of
the date of grant) shall vest on each of the above four vesting
dates. The remainder of the stock options, which shall be
nonstatutory stock options, shall vest in equal portions on
December 31, 2005 and March 31, 2006.

     (c) The Employer shall structure the stock option grant such
that only stock options that have vested shall be exercisable by
the Executive or his beneficiaries on or after the Termination
Date, except in the event of the Executive’s death, disability,
retirement, or a change in control of the Company as defined below
in Subsection 4 (iii)(d), or the termination of the Executive’s
employment in accordance with Subsection 5(v) or by the Employer
without Cause. Upon the death, disability or retirement of the
Executive, or a change in control of the company as defined in
Subsection 4(iii)(d), or the termination of the Executive’s
employment in accordance with Subsection 5(v) or by the Employer
without Cause, all options granted on the date of this Agreement
that have not become exercisable as of the Termination Date shall
become immediately exercisable.

     (d) For purposes of this Agreement, a “change in control”
shall be deemed to have occurred if any “individual, entity or
group” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act) is or becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities representing 25% or more of the voting power of the
securities of the Company or of the Bank or becomes the owner of
all or substantially all of the assets of the Company or of the
Bank or if the shareholders of the Company or of the Bank approve a
reorganization, merger or consolidation of the Company or of the
Bank. “Change in control” shall not refer to or include any
transaction involving only entities affiliated directly or
indirectly with the Company.

34

 

     (e) The stock options granted to the Executive on the date of
this Agreement shall remain exercisable by the Executive or his
beneficiaries for one (1) year after the Executive’s termination of
employment if the termination is as a result of the Executive’s
death or disability. In the event the Executive’s employment is
terminated as a result of his normal retirement, the Executive or
his beneficiaries shall have ninety (90) days after such
termination of employment to exercise the stock options. In the
event the Executive’s employment is terminated for any reason other
than due to his death, disability, or retirement, the Executive or
his beneficiaries shall have thirty (30) days after such
termination of employment to exercise the stock options. Nothing
contained herein should be construed to extend the ultimate term of
any of the stock options beyond the period of ten (10) years from
the date of their grant.

     (f) Shares of common stock of the Company acquired upon the
exercise of the stock options granted to the Executive on the date
of this Agreement shall not be subject to the transfer restrictions
of Section 8 of the Plan. However, Executive shall provide written
notice to the Company in the event the Executive sells or otherwise
disposes of common stock acquired upon the exercise of an incentive
stock option granted on the date of this Agreement before the later
of the expiration of the two-year period beginning on the date of
the grant of such stock options or the expiration of the one-year
period 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 shall
provide to Executive, in addition to Base Salary, such other benefits of
employment (or, with Executive’s consent, equivalent benefits) as are
made generally available to executive officers serving in comparable
positions at Employer or its affiliates. Such benefits include
participation in any group health, life, disability, or similar insurance
program and in any pension, profit sharing, deferred compensation, 401(k)
or other similar retirement program provided. Executive shall also have
the right to participate, on the same basis as other executives of
Employer, in any stock purchase, stock option or stock appreciation
rights plans, or other stock-based program made available to such
executive officers. Executive shall also be entitled to participate in
any plan or program offered to other executives of Employer for the
purpose of protecting such executives in the event of a change in control
of the Company, as defined in Subsection 4(iii)(d), except that Executive
shall not be entitled to participate in the Company’s Supplemental
Executive 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 current
deferred compensation program of the Bank, as enumerated in the Wisconsin
State Bank Deferred Compensation Agreement

35

 

between Bank and Executive dated as of December 12, 2002 (the “Deferred
Compensation Agreement”). For purposes of the Deferred Compensation
Agreement, the Executive shall be deemed to be an employee of the Bank
through the Termination Date.

     Executive shall be entitled to four weeks vacation, in addition to
other perquisites in the same manner and to the same extent as provided
other executives of Employer. Executive shall be entitled to use of a
car, the cost of such use to be paid for by Employer. The type of car
provided to the Executive shall be consistent with the type of car
provided to similarly situated executives of the Employer.

     Nothing contained herein shall be construed as granting Executive
the right to continue in any benefit plan or program, or to receive any
other perquisite of employment, provided under this section 4(iv) (except
to the extent Executive had previously earned or otherwise accumulated
vested rights therein) following a valid and lawful termination or
discontinuance of such plan, program or perquisite.

     5. Termination. This Agreement may be terminated, subject to payment of
the compensation and other benefits described below, upon occurrence of any of
the events described herein. The date on which Executive ceases to be employed
under this Agreement, after giving effect to the period of time specified in
any notice requirement, is referred to as the “Termination Date.”

     (i) Death; Disability; Retirement. This agreement shall terminate
upon the death, disability or retirement of Executive. As used in this
Agreement, “disability” means Executive’s inability, as the result of
physical or mental incapacity, to substantially perform his duties for a
period of 180 consecutive days. If the Executive and Employer cannot
agree as to the existence of a disability, the determination shall be
made by a qualified independent physician acceptable to both parties, or
alternatively, by a physician designated by the president of the medical
society for the county in which Executive resides. The costs of any such
medical examination shall be borne by Employer. If Executive is
terminated due to disability, subject to the limitations in Section 6, he
shall be paid 100% of his Base Salary at the rate in effect at the time
notice of termination is given for the remaining portion of the
Employment Term, such amounts to be paid in substantially equal monthly
installments and offset by any monthly payments actually received by
Executive from: (a) any disability plans or disability insurance
programs provided by Employer, and (b) any governmental social security
or workers compensation program.

     As used in this Agreement, the term “retirement” shall mean
Executive’s retirement on or after the Executive’s
55th birthday or in
accordance with any retirement arrangement established for Executive with
his consent.

36

 

     If termination occurs as a result of death, disability or
retirement, no additional compensation shall be payable to Executive
under this Agreement except as specifically provided herein.
Notwithstanding anything to the contrary contained herein, if
termination occurs as a result of death, disability or retirement,
Executive shall receive all compensation and other benefits to which he
was entitled under Section 4 and the plans and programs provided therein,
through the Termination Date and, in addition, Executive and any family
members covered at the time of the termination, if applicable, shall
receive or continue to receive for the remaining portion of the
Employment Term all other benefits available to Executive and such family
members under any applicable group health, life, disability or similar
insurance 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 the
expiration of the then remaining balance of the Employment Term,
Executive becomes able to resume his duties, he shall be reinstated to
his position, or if such position has been filled, to a position as
nearly comparable as possible. From the date of reinstatement and for
the balance of the Employment Term, Executive shall be obligated to
perform all duties and responsibilities, and entitled to receive all
compensation and other benefits, as provided in this Agreement.

     (ii) Cause. Employer may terminate Executive’s employment under
this Agreement for Cause at any time, and thereafter Employer or Bank
shall have no further obligation under this Agreement. Notwithstanding
anything to the contrary contained herein, Executive shall receive all
compensation and other benefits in which he was vested or to which he was
otherwise entitled under Section 4 and the plans and programs provided
therein, by reason of employment through the Termination Date.

     For purposes of this Agreement, “Cause” shall mean:

	(a)	 	A failure by Executive to substantially perform
his 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 Board
believes Executive has not substantially performed, and
Executive’s failure to cure within a reasonable period of time
after his receipt of this notice;
	 
	(b)	 	A criminal conviction of or plea of nolo
contendere by Executive for any act involving dishonesty,
breach of trust or a violation of the banking laws of the
State of Wisconsin or the United States which, in the
reasonable judgment of the Board, is substantially related to
the Executive’s position with the Employer or substantially
impairs the Executive’s ability to perform his duties with the
Employer;

37

 

	(c)	 	A criminal conviction of or plea of nolo
contendere by Executive for the commission of any felony
which, in the reasonable judgment of the Board, is
substantially related to the Executive’s position with the
Employer or
substantially impairs the Executive’s ability to perform his
duties with the Employer;
	 
	(d)	 	A breach of fiduciary duty by Executive involving
personal profit;
	 
	(e)	 	A willful violation of any law, rule or order by
Executive (other than traffic violations or similar offenses)
which, in the reasonable judgment of the Board, is
substantially related to the Executive’s position with the
Employer or substantially impairs the Executive’s ability to
perform his duties with the Employer; or
	 
	(f)	 	the Executive’s engagement in gross misconduct or
a material breach of any provision of this Agreement which
results in a demonstrably material injury to the Employer,
monetary or otherwise, provided such misconduct or breach was
not in good faith and he had no reasonable belief such act or
omission was in the best interests of the Employer and its
shareholders.

     For purposes of this subsection 5(ii), no act, or failure to act, on
Executive’s part shall be deemed “willful” unless done, or omitted to be
done, by Executive not in good faith and without reasonable belief that
the action or omission was in the best interest of Employer

     (iii) Voluntary Termination by Executive. Executive may voluntarily
terminate employment at any time by giving at least ninety (90) days
prior written notice to Employer. In such event, Employer shall have no
further obligation hereunder, except that Executive shall receive all
compensation and other benefits in which he was vested or to which he was
otherwise entitled under Section 4 and the plans and programs provided
therein, by reason of his employment through the Termination Date.

     (iv) Suspension or Termination required by Regulatory Agencies.

	(a)	 	If Executive is suspended and/or temporarily
prohibited from participating in the conduct of Employer’s or
any of Employer’s affiliates’ affairs by a regulatory agency,
Employer’s obligations under the Agreement shall be suspended
as of the date of service of the notice unless stayed by
appropriate proceedings. If the charges in the notice are
dismissed, the Employer shall: (1) pay Executive all of the
compensation withheld while its obligations under this
Agreement were suspended; and (2) reinstate any of its
obligations which were suspended.

38

 

	(b)	 	If Executive is removed and/or permanently
prohibited from participating in the conduct of Employer’s or
any of Employer’s affiliates affairs by an order issued by a
regulatory agency, the obligation of Employer under the
Agreement shall terminate as of the effective date of the
order, but earned
or otherwise vested rights of Executive to compensation and
to any benefits under Section 4 shall not be affected.
	 
	(c)	 	All obligations under the Agreement may be
terminated, except to the extent determined that continuation
of the contract is necessary to operation of Employer or any
of its affiliates, at the time the Federal Deposit Insurance
Corporation (“FDIC”) enters into an agreement to provide
assistance to or on behalf of Employer or any of Employer’s
affiliates under the authority contained in Section 13(c) of
the Federal Deposit Insurance Act, or when Employer or any of
its affiliates is determined by any appropriate bank
regulatory agency to be in an unsafe or unsound condition.
Any rights of the parties that have been already earned or
otherwise vested, however, shall not be affected by such
action.

     (v) Termination by Executive Due to Diminished Responsibilities or
Compensation. Executive may at any time within twelve (12) months
following one of the following events outlined below in Sections 5 (v)
(a), (b), (c), (d) or (e) terminate his employment under this Agreement
by giving at least ninety (90) days prior written notice to Employer, and
be entitled to the benefits described in Section 5 (vi) below:

(a) Executive is assigned to positions, duties or responsibilities
that are substantially less significant than the positions, duties
and responsibilities provided herein;

(b) Executive is removed from or Employer fails to re-elect or
re-appoint Executive to his position, except in connection with
termination of Executive’s employment for cause, disability or
retirement, or in connection with suspension or termination by or
pursuant to regulatory action;

(c) Executive’s Base Salary is reduced other than as the result of
a program applied on a proportionately equivalent basis to all
executives of Employer and its affiliates;

(d) Executive is required to commute more than forty (40) miles to
his principal place of business; or

     (e) Employer provides written notice that the term of the Agreement
shall not be extended in accordance with Section 2, except in the event
that such notice is given in

39

 

connection with a determination by the
Employer that the Executive has acted or has failed to act in a manner
constituting Cause under Section 5(ii) of this Agreement.

     (vi) Benefits Upon Other Termination by Employer. If Executive
terminates this Agreement in accordance with Section (v), or if this
Agreement is terminated by Employer other than for death, disability or
retirement under Section 5(i) and other than for “Cause” under Section 5(ii) or other than by
regulatory action under Section (iv), then following the Termination
Date, Executive shall be entitled to the following benefits:

	(a)	 	In lieu of any further salary payments, Executive
shall receive severance payments equal to the sum of the Base
Salary in effect on the Termination Date plus cash bonus for
the year prior to termination times the number of full or
partial years remaining in the Employment Term, payable in the
amount and at the times provided in Sections 4(i) and (ii).
If termination follows a “change in control” as defined in
Subsection 4(iii)(d), Executive may elect to receive the
payments specified in the immediately preceding sentence in a
lump sum without any discount by filing the election in the
form set forth in Exhibit A at least twelve (12) months before
the date of such a change in control; provided, however, that
if the termination follows a “change in control” as defined in
Subsection 4(iii)(d), the amount of such severance payments
may not exceed the limitations established below in Section 6.
	 
	(b)	 	In addition to other amounts payable to Executive
under this Subsection 5(vi), Executive shall be entitled to
receive all other benefits in which he was vested or to which
he was otherwise entitled under Section 4 and the plans and
programs provided therein by reason of employment through the
Termination Date, together with the continuation, without cost
to Executive, of other benefits under Section 4(iv) for the
remaining unexpired Employment Term, subject to the
limitations set forth in Section 6 below if the Executive is
terminated following a “change in control” as defined in
Subsection 4(iii)(d).

     (vii) Suspension by Employer. Board in its sole discretion shall
have the right to temporarily suspend Executive from participating in the
conduct of the Employer’s or Employer’s affiliates’ affairs. If
Executive is suspended or temporarily prohibited from participating in
the conduct of Employer’s or Employer’s affiliates’ business, Employer
shall pay Executive all compensation and provide all benefits pursuant to
Section 4 of this Agreement during the period of such suspension.

     6. Limitations on Change in Control Compensation. In the event severance
benefits under Subsection 5(vi) or severance benefits in the event of the
Executive’s disability

40

 

under Subsection 5(i) (together, the “Specified
Severance Benefits”), or any other payments or benefits received or to be
received by Executive from Employer or Bank (whether payable pursuant to the
terms of this Agreement, any other plan, agreement or arrangement with Employer
or any corporation (“Affiliate”) affiliated with employer within the meaning of
Section 1504 of the Internal Revenue Code of 1986 as amended (the “Code”)),
constitute, in the opinion of tax counsel selected by Employer’s independent
auditors and acceptable to Executive, “parachute payments” within the meaning
of Section 280G(b)(2) of the Code, and the present value of such “parachute payments” equals or exceeds three times the
average of the annual compensation payable to Executive by Employer (or an
Affiliate) and includible in Executive’s gross income for federal income tax
purposes for the five (5) calendar years preceding the year in which a change
in ownership occurred (“Base Amount”), the Specified Severance Benefits shall
be reduced to an amount the present value of which (when combined with the
present value of any other payments otherwise received or to be received by
Executive from Employer (or an Affiliate) that are deemed parachute payments”)
is equal to 2.99 times the Base Amount, notwithstanding any other provision to
the contrary in this Agreement; provided, however, that the Specified Severance
Benefits shall not be reduced if they are payable as a result of the
termination of the Executive’s employment in accordance with Section 5(v) or if
they are a result of the Executive’s termination by the Employer without Cause.
The Specified Severance benefits shall not be reduced if (i) Executive shall
have effectively waived his receipt or enjoyment of any such payment or benefit
which triggered the applicability of this Section 6, or (ii) in the opinion of
tax counsel, the Specified Severance Benefits (in their full amount or as
partially reduced, as the case may be) plus all other payments or benefits
which constitute “parachute payments” within the meaning of Section 280OG(b)(2)
of the Code are reasonable compensation for services actually rendered, within
the meaning of Section 28OG(b)(4) of the Code and such payments are deductible
by Employer. The Base Amount shall include every type and form of compensation
includible in Executive’s gross income in respect of his employment by Employer
(or an Affiliate), except to the extent otherwise provided in temporary or
final regulations promulgated under Section 28OG(b) of the Code. For purposes
of this Section 6, a “change in ownership or control” shall have the meaning
set forth in Section 28OG(b) of the Code and any temporary or final regulations
promulgated thereunder. The present value of any non-cash benefit or any
deferred cash payment shall be determined by Employer’s independent auditors in
accordance with the principles of Section 28OG of the Code.

     Executive shall have the right to request that Employer obtain a ruling
from the Internal Revenue Service (“Service”) as to whether any or all payments
or 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’s
request, no Specified Severance Benefits payable under this Agreement in excess
of the Section 28OG limitation shall be made to Executive until after fifteen
(15) days from the date of such ruling; however, severance benefits shall
continue to be paid during this time up to the amount of that limitation. For
purposes of this Section 6, Executive and Employer agree to be bound by the
Service’s ruling as to whether payments constitute “parachute payments” under
Section 280G. If the Service declines, for any reason, to provide the ruling
requested, the tax counsel’s opinion provided with respect to what payments or
benefits constitute “parachute payments” shall control, and the period during
which the severance benefits

41

 

may be deferred shall be extended to a date
fifteen (15) days from the date of the Service’s notice indicating that no
ruling will be forthcoming.

     7. Waiver of Change in Control Salary Continuation Benefits. In
connection with this Agreement, Executive agrees that, for purposes of the
Amended and Restated Wisconsin State Bank Salary Continuation Agreement by and
between Executive and the Bank dated March 6, 2002 (the “SCA”), the acquisition
of the Bank by the Employer, in accordance with the Merger Agreement (the “Acquisition”), shall not constitute a Change of
Control. Therefore, the Executive acknowledges that he is not entitled to the
benefits 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 SCA
remain available to Executive upon a Change in Control (as such term is defined
in 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 in
subsection 4(iii)(d) of this Agreement (in either instance, a “Second Change in
Control”).

     Employer acknowledges that this Agreement does not supersede the SCA.
Except as provided in this paragraph, Employer agrees that in no event shall
Executive lose any of the benefits to which he is entitled under the SCA
without the consent of the Executive. Employer agrees that in the event the
Executive is entitled to benefits under Section 2.2 or 2.3 of the SCA as a
result of the Executive’s termination of employment during the fourth quarter
of the calendar year, for purposes of determining the benefit payable to
Executive under the SCA and its accompanying Schedule A, the Executive’s
termination shall be deemed to occur on January 2nd of the year following the
Executive’s termination of employment.

     Employer agrees that the salary continuation payments to which the
executive is entitled under the SCA shall in no event be subject to the
limitations above in Section 6 of this Agreement. Upon a Second Change in
Control, Employer agrees that the insurance policies purchased to fund the SCA
or an equivalent amount of cash consideration will be deposited in a rabbi
trust in the form provided in Revenue Procedure 92-64 or any successor guidance
issued by the Internal Revenue Service, which shall be administered by an
independent trustee, and which shall pay benefits owing to Executive under the
SCA if the Company or its successor fails to do so.

42

 

     8. General Provisions.

     (i) Successors; Binding Agreement.

	 	(a)	 	Employer will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to substantially all of the business and/or assets
of Employer (“Successor Organization”) to expressly assume and
agree to perform this Agreement in the same manner and to the
same extent that Employer would have been required to perform
if no such succession had taken place. If such succession is
the result of a “change in control” as defined herein, such
assumption shall specifically preserve to Executive, for the
then remaining term of this Agreement, the same rights and
remedies (recognizing them as being available and applicable
as the result of the “change in control” effectuating said
succession) provided under this Agreement upon a “change in
control.”
	 
	 	 	 	As used in this Agreement, Employer shall include any
successor to the Employer’s business and/or assets, which
becomes bound by the terms and provisions of this Agreement
by operation of this Agreement or by law. Failure of
Employer to obtain such agreement prior to the effectiveness
of any such succession shall be a breach of this Agreement
and shall entitle Executive to compensation from Employer in
the same amount and on the same terms as he would be entitled
to under this Agreement if he terminated his employment under
Section 5(vi). For purposes of implementing the foregoing,
the date on which any such succession becomes effective shall
be deemed the Termination Date.
	 
	 	(b)	 	No right or interest to or in any payments or
benefits under this Agreement shall be assignable or
transferable in any respect by the Executive, nor shall any
such 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 this
agreement may be assigned or transferred by Employer to any of
its affiliates prior to a change in control as defined in this
Agreement.
	 
	 	(d)	 	This Agreement shall be binding upon and inure to
the benefit of and be enforceable by Executive and his heirs,
beneficiaries and personal representatives and Employer and
any successor organization or assignee of Employer.

     (ii) Non-competition/Non-solicitation/Confidentiality Provisions.

43

 

     Executive acknowledges that the development of personal contacts and
relationships is an essential element of Employer’s and Employer’s
affiliates’ business, that Employer has invested considerable time and
money in his development of such contacts and relationships, that
Employer and its affiliates could suffer irreparable harm if he were to
leave Employer’s employment and solicit the business of customers of
Employer or Employer’s affiliates and that it is reasonable to protect
Employer against competitive activities by Executive. Executive
covenants and agrees, in recognition of the foregoing and in
consideration of the mutual promises contained herein, that in the event
of a termination of his employment with Employer or any of its
affiliates, Executive shall not accept employment with any Significant
Competitor of Employer or of any of Employer’s affiliates for a period of
eighteen (18) months following such termination. For purposes of this
Agreement, the term “Significant Competitor” means any financial
institution including, but not limited to, any commercial bank, savings
bank, savings and loan association, credit union, or mortgage banking
corporation which, at the time of termination of Executive’s employment
with Employer or during the period of this covenant not to compete, has a
home, branch or other office within a fifty (50) mile radius of any
office operated or maintained by Employer or any of Employer’s
affiliates.

     Executive agrees that the non-competition provisions set forth
herein are necessary for the protection of Employer and its affiliates
and are reasonably limited as to (a) the scope of activities affected,
(b) their duration and geographic scope, and (c) their effect on
Executive and the public. In the event Executive violates the
non-competition provisions set forth herein, Employer shall be entitled,
in addition to its other legal remedies, to enjoin the employment of
Executive with any Significant Competitor for the period set forth
herein. If Executive violates this covenant and Employer brings legal
action for injunctive or other relief, Employer shall not, as a result of
the time involved in obtaining such relief, be deprived of the benefit of
the full period of the restrictive covenant. Accordingly, the covenant
shall be deemed to have the duration specified herein, computed from the
date relief is granted, but reduced by any period between commencement of
the period and the date of the first violation.

     Executive acknowledges that as a result of his employment with
Employer or its affiliates Executive has access to confidential
information 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 proprietary
information, 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 the
products, services, customers or prospective customers, sales, technology
and business affairs or methods of Employer or any of its affiliates
(collectively “Confidential Information”) which Executive acquires or has
access to during the Employment Term. Notwithstanding the foregoing,
Confidential Information shall not include information or data which is
otherwise available in the public domain. Executive agrees that he will
not at any time either during or subsequent to his employment with
Employer disclose or

 

transmit, either directly or indirectly, any Confidential
Information of Employer or its affiliates to any person, firm,
corporation, association, or other entity, and will not remove this
information, in any form whatsoever, from the premises or data base of
Employer or its affiliates, except as required in the ordinary course of
business as is necessary to perform Executive’s duties or as required by
applicable law. In the event of Executive’s termination from employment
from Employer for any reason, Executive shall immediately return all
Confidential Information of Employer, including any original,
computerized or duplicated records to Employer.

     Executive agrees that during the term of his employment with
Employer, and for a term of eighteen (18) months thereafter, he will not,
directly or indirectly, on behalf of himself or on behalf of any other
individual or entity, as an agent or otherwise contact, influence or
encourage any of the customers of Employer, of which Executive has
knowledge or based on his capacity of employment for Employer or its
subsidiaries should reasonably have had knowledge, for the purpose of
soliciting business or inducing such customer to acquire any product or
service that is provided or under development by Employer or its
affiliates from any entity other than Employer.

     Executive agrees that during the term of his employment with
Employer, and for a period of eighteen (18) months thereafter, he will
not, directly or indirectly, encourage, induce, or entice any employee of
Employer or its affiliates to leave the employment of Employer or its
affiliates.

     Executive agrees that if he violates the covenants under this
section, Employer shall be entitled to an accounting and repayments of
all profits, compensation, commissions and other remuneration or benefits
which the Executive has realized or may realize as the result of or in
connection with any such violation. Executive further agrees that money
damages may be difficult to ascertain in case of a breach of this
covenant, and Executive therefore agrees that Employer or its affiliates
shall be entitled to injunctive relief in addition to any other remedy to
which Employer or its affiliates may be entitled.

     (iii) Notice. All notices and other communications provided for in
this Agreement shall be in writing and shall be deemed duly given when
delivered or mailed by United States registered mail, return receipt
requested, postage prepaid, addressed in the case of Employer to its
principal office and in the case of Executive, to his address appearing
on the records of Employer or to such other address as either party may
have furnished to the other in writing in accordance herewith.

     (iv) Expenses. If legal proceedings are necessary to enforce or
interpret this Agreement, or to recover damages for breach, the
prevailing party shall be entitled to recover reasonable attorneys’ fees,
costs and disbursements of such proceedings, in addition to any other
relief to which such prevailing party may be entitled. Notwithstanding,
the foregoing, in the event of legal proceedings to enforce or interpret
this Agreement following a “change in control,” Executive shall be
entitled to recover from Employer: (a) reasonable attorneys fees, costs,
and disbursements if Executive is

 

the prevailing party; or (b) reasonable attorneys’ fees, costs and
disbursements of up to $7,500 incurred in such proceedings regardless of
whether Executive is the prevailing party. Recovery of attorneys’ fees
and costs following a “change in control” shall be in addition to any
other relief to which Executive is entitled.

     (v) Withholding. Employer shall be entitled to withhold from
amounts to be paid to Executive under this Agreement any federal, state,
or local withholding or other taxes or charges which it is from time to
time required to withhold. Employer shall be entitled to rely on an
opinion of counsel as to the amount or requirement of any such
withholding.

     (vi) Miscellaneous. No provision of this Agreement may be amended,
waived or discharged unless such amendment, waiver or discharge is agreed
to in writing and duly executed by Executive and Employer or its
successor in interest. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State
of Wisconsin.

     (vii) Validity. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any
other provision of this Agreement, which shall remain in full force and
effect.

     (viii) Counterparts. This Agreement may be executed in several
counterparts, all of which together will constitute one and the same
instrument.

     (ix) Headings. Headings contained in this Agreement are for
reference only and shall not affect the meaning or interpretation of any
provision of this Agreement.

     (x) Effective Date. The effective date of this Agreement shall be
the date indicated in the first paragraph of this Agreement
notwithstanding the actual date of execution by any party.

 

     IN
WITNESS WHEREOF, the undersigned have duly executed this Agreement as
of 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

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