Outsourcing Agreement

OUTSOURCING AGREEMENT


BY AND BETWEEN


THE PRIVATEBANK AND TRUST COMPANY


and


MARSHALL & ILSLEY CORPORATION
acting through its division
M&I DATA SERVICES


DATED AS OF


APRIL ___, 1999


TABLE OF CONTENTS
-----------------
Page
---- 1. DEFINITIONS........................................................... 1
1.1 Background........................................................ 1
1.2 Definitions....................................................... 1
1.3 References........................................................ 6
1.4 Interpretation.................................................... 6


2. TERM.................................................................. 6
2.1 Initial Term...................................................... 6
2.2 Extensions........................................................ 6


3. APPOINTMENT........................................................... 7
3.1 Performance by M&I Affiliates or Subcontractors................... 7
3.2 Third Party Products/Services..................................... 7
3.3 Proper Instructions............................................... 8


4. CONVERSION............................................................ 8
4.1 Banking Applications.............................................. 8
4.2 Development of Conversion Plan.................................... 8
4.3 Conversion Resources.............................................. 8
4.4 Conversion Milestones............................................. 9


5. BANKING APPLICATION SERVICES.......................................... 9
5.1 ADP Services...................................................... 9
5.2 New Services...................................................... 9
5.3 Automated Clearing House Services................................. 9
5.4 Item Processing Services.......................................... 9
5.5 Data Warehouse Services........................................... 10


6. RETAIL DELIVERY SYSTEMS AND SERVICES.................................. 10
6.1 Home Banking Services............................................. 10
6.2 Branch Automation Systems......................................... 10


7. BANKCARD PROCESSING SERVICES.......................................... 10
7.1 Cardholder and Merchant Accounts.................................. 10
7.2 EFD Services...................................................... 11


8. FEES.................................................................. 11
8.1 Fee Structure..................................................... 11
8.2 Conversion........................................................ 11
8.3 Pricing and Operational Assumptions............................... 11
8.4 EFD Services...................................................... 12
8.5 Training and Education............................................ 12
8.6 Excluded Costs.................................................... 12
8.7 Disputed Amounts.................................................. 12
8.8 Terms of Payment.................................................. 13
8.9 Modification of Terms and Pricing................................. 13


9. PERFORMANCE STANDARDS................................................. 13
9.1 General........................................................... 13
9.2 Service Deficiencies.............................................. 13
9.3 Exclusive Remedy.................................................. 14


10. MODIFICATION OR PARTIAL TERMINATION................................... 14
10.1 Modifications to Services......................................... 14
10.2 Partial Termination by M&I........................................ 14
10.3 Partial Termination by Customer................................... 15
10.4 Ownership and Proprietary Rights.................................. 15
10.5 Millennium Modifications.......................................... 15


11. TERMINATION........................................................... 16
11.1 Early Termination................................................. 16
11.2 For Cause......................................................... 16
11.3 For Insolvency.................................................... 16
11.4 For Force Majeure................................................. 16


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12. SERVICES FOLLOWING TERMINATION....................................... 17 12.1 Termination Assistance............................................ 17 12.2 Continuation of Services.......................................... 17


13. DAMAGES.............................................................. 18 13.1 General........................................................... 18 13.2 No Consequential Damages.......................................... 18 13.3 Equitable Relief.................................................. 18 13.4 Limitation of Liability........................................... 18 13.5 Economic Loss Waiver.............................................. 18 13.6 Liquidated Damages................................................ 19 13.7 Essential Elements................................................ 19


14. INSURANCE AND INDEMNITY.............................................. 19 14.1 Insurance......................................................... 19 14.2 Indemnity......................................................... 19 14.3 Indemnification Procedures........................................ 20


15. DISPUTE RESOLUTION................................................... 21 15.1 Representatives of Parties........................................ 21 15.2 Continuity of Performance......................................... 21


16. REPRESENTATIONS AND WARRANTIES....................................... 21 16.1 By M&I............................................................ 21 16.2 By Customer....................................................... 22


17. CONFIDENTIALITY AND OWNERSHIP........................................ 23 17.1 Customer Data..................................................... 23 17.2 M&I Systems....................................................... 23 17.3 Confidential Information.......................................... 23 17.4 Obligations of the Parties........................................ 24 17.5 Security.......................................................... 24


18. MANAGEMENT OF PROJECT................................................ 24 18.1 Account Representatives........................................... 24 18.2 Reporting and Meetings............................................ 25 18.3 Development Projects and Technical Support........................ 25


19. REGULATORY COMPLIANCE................................................ 25


20. DISASTER RECOVERY.................................................... 26 20.1 Services Continuity Plan.......................................... 26 20.2 Relocation........................................................ 26 20.3 Resumption of Services............................................ 27 20.4 Annual Test....................................................... 27


21. GENERAL TERMS AND CONDITIONS......................................... 27 21.1 Transmission of Data.............................................. 27 21.2 Equipment and Network............................................. 27 21.3 Reliance on Data.................................................. 27 21.4 Data Backup....................................................... 28 21.5 Balancing and Controls............................................ 28 21.6 Use of Services................................................... 28 21.7 Regulatory Assurances............................................. 28 21.8 IRS Filing........................................................ 29 21.9 Affiliates........................................................ 30 21.10 Future Acquisitions............................................... 30


22. MISCELLANEOUS PROVISIONS............................................. 31 22.1 Governing Law..................................................... 31 22.2 Venue and Jurisdiction............................................ 31 22.3 Entire Agreement; Amendments...................................... 31 22.4 Assignment........................................................ 32 22.5 Relationship of Parties........................................... 32 22.6 Notices........................................................... 32 22.7 Headings.......................................................... 33 22.8 Counterparts...................................................... 33 22.9 Waiver............................................................ 33 22.10 Severability...................................................... 33


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22.11 Attorneys' Fees and Costs......................................... 33 22.12 Financial Statements.............................................. 33 22.13 Publicity......................................................... 34 22.14 Solicitation...................................................... 34 22.15 No Third Party Beneficiaries...................................... 34 22.16 Force Majeure..................................................... 34 22.17 Construction...................................................... 34 22.18 Waiver of Jury Trial.............................................. 35


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Schedules - ---------


1.2 Customer Affiliates 4.2 Conversion Plan 5.1 ADP Services Schedule 5.3 ACH Services Terms and Conditions 5.4 Item Processing Services 5.5 Data Warehouse Services 7.2 EFD Services 8.1 Fee Schedule 9.1 ADP Performance Standards 11.1 Termination Fee 21.2 Network Schedule


Exhibits - --------


A ACH Authorization Agreement B Attorney-in-Fact Appointment C Affidavit


OUTSOURCING AGREEMENT
---------------------


This Outsourcing Agreement ("Agreement") is made as of the ____ day of April, by and between The PrivateBank and Trust Company, an Illinois corporation ("Customer"), and Marshall & Ilsley Corporation, a Wisconsin corporation, acting through its division, M&I Data Services ("M&I").


In consideration of the payments to be made and services to be performed hereunder, the parties agree as follows:


1. DEFINITIONS


1.1 Background.
----------


This Agreement is being made and entered into with reference to the following facts:


A. Customer provides systems development and operations, data processing, telecommunications and other information technology services for itself, and on behalf of its customers.


B. M&I is a provider of data processing, systems development and operations, corporate support and item processing, home banking, internet banking, retail delivery services, trust data processing, and other services. M&I desires to perform for Customer the outsourcing services described in this Agreement.


C. In reliance on its own independent analysis, and after careful evaluation of M&I's proposal and other alternatives, Customer has selected M&I to provide the Services (as defined in Section 1.2) to Customer. This Agreement documents the terms and conditions under which Customer agrees to purchase and M&I agrees to provide the Services.


1.2 Definitions.
-----------


The following terms shall have the meaning ascribed to them in this Section 1.2:


A. "Account Representative" shall have the meaning set forth in Section 18.1.


B. "ADP Services" shall mean the Accounts Data Processing Services set forth in attached Schedule 5.1.
------------


C. "Affiliate" shall mean, with respect to a party, any entity at any time Controlling, Controlled by or under common Control with, such party.


D. "Branch Automation Agreement" shall mean the Branch Automation Agreement of even date herewith between M&I and Customer relating to the license and implementation of M&I's proprietary branch automation software.


E. "Change in Control" shall mean any event or series of events by which any person or entity or group of persons or entities shall acquire Control of another person or entity.


F. "Commencement Date" shall mean the date on which Conversion for Customer and all Affiliates identified on Schedule 1.2 has been completed.
------------


G. "Confidential Information" shall have the meaning set forth in Section 17.3 of this Agreement.


H. "Contract Year" shall mean successive periods of twelve months, the first of which (being slightly longer than twelve (12) months) shall commence on the Commencement Date and terminate on the last day of the month in which the first anniversary of the Commencement Date occurs.


I. "Control" shall mean the direct or indirect ownership of over 50% of the capital stock (or other ownership interest, if not a corporation) of any Entity or the possession, directly or indirectly, of the power to direct the management and policies of such Entity by ownership of voting securities, by contract or otherwise. "Controlling" shall mean having Control of any Entity and "Controlled" shall mean being the subject of Control by another Entity.


J. "Conversion" shall mean (i) the transfer of Customer's data processing and other information technology services to the M&I system; (ii) completion of upgrades, enhancements and software modifications as set forth in this Agreement; and (iii) completion of all interfaces set forth in this Agreement and full integration thereof such that Customer is able to receive the Initial Services in a live operating environment.


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K. "Conversion Date" shall mean the date on which Conversion for Customer or a particular Affiliate has been completed. Schedule 1.2 identifies
------------ the Conversion Date for Customer and each Affiliate identified therein.


L. "Conversion Period" shall mean that portion of the Term beginning on the Effective Date and ending on the Conversion Date.


M. "Core Services" shall mean services provided by M&I's Deposit System, Loan System and Customer Information System.


N. "Customer" shall mean Customer and all Affiliates of Customer for whom M&I agrees to provide Services under this Agreement; Schedule 1.2 attached
------------ hereto identifies such Affiliates as of the Effective Date.


O. "Customer Data" shall have the meaning set forth in Section 17.1 of this Agreement.


P. "Damages" shall mean all direct, actual and verifiable losses, liabilities, damages and claims and related costs and expenses (including reasonable attorneys' fees and court costs, costs of investigation, litigation, settlement, judgment, interest and penalties).


Q. "Effective Date" shall mean the date first set forth above.


R. "Effective Date of Termination" shall mean the last day on which M&I provides the Services to Customer (including any Termination Assistance).


S. "Eligible Provider" shall have the meaning as set forth in Section 3.1 of this Agreement.


T. "Entity" means an individual or a corporation, partnership, sole proprietorship, limited liability company, joint venture or other form of organization, and includes the parties hereto.


U. "Estimated Remaining Value" shall mean the number of calendar months remaining between the Effective Date of Termination and the last day of the contracted-for Term, multiplied by the average of the three (3) highest monthly Fees (but in any event no less than the Monthly Base Fee) payable by Customer during the twelve (12) month period prior to the event giving rise to termination rights under


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this Agreement. In the event the Effective Date of Termination occurs prior to expiration of the First Contract Year, the estimated monthly fees set forth in the Fee Schedule shall be substituted for the average monthly fees described in the preceding sentence.


V. "Expenses" shall mean any and all reasonable and direct expenses incurred by M&I in connection with the proper performance of its obligations hereunder for any postage, supplies, materials, travel and lodging provided to or on behalf of Customer under this Agreement.


W. "Federal Regulator" shall have the meaning set forth in Section 21.7.


X "Fee Schedule" shall have the meaning set forth in Section 8.1 of this Agreement.


Y. "Initial Services" shall mean those Services requested by Customer from M&I under this Agreement prior to the Commencement Date. The Initial Services requested as of the Effective Date are set forth in the schedules attached hereto, which shall be modified to include any additional services requested by Customer during the Conversion Period.


Z. "Initial Term" shall have the meaning set forth in Section 2.1 of this Agreement.


AA. "Legal Requirements" shall have the meaning set forth in Section 19(A) of this Agreement.


BB. "LU" shall have the meaning as set forth in Section 8.5 of this Agreement.


CC. "M&I Proprietary Materials and Information" shall mean the M&I Software and all source code, object code, documentation (whether electronic, printed, written or otherwise), working papers, non-customer data, programs, diagrams, models, drawings, flow charts and research (whether in tangible or intangible form or in written or machine readable form), and all techniques, processes, inventions, knowledge, know-how, trade secrets (whether in tangible or intangible form or in written or machine readable form), developed by M&I prior to or during the Term of this Agreement, and such other information relating to M&I or the M&I Software that M&I identifies to Customer as proprietary or confidential at the time of disclosure.


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DD. "M&I Software" shall mean the software owned by M&I and used to provide the Services.


EE. "Millennium Ready" shall mean the ability of the M&I Software to accurately process date/time data (including calculating, compare and sequence) from, into and between the years 1999 and 2000, including leap year calculations, to the extent that other information technology, used in combination therewith, properly exchanges date/time data with the M&I Software.


FF. "Monthly Base Fee" shall mean the minimum monthly fees payable by Customer to M&I for those Initial Services identified in the ADP Services Schedule or the Fee Schedule as being included in the Monthly Base Fee.


GG. "New Services" shall mean any services which are not included in the Initial Services. Upon mutual agreement of the parties, New Services shall be included in the term "Services."


HH. "Operations Center" shall mean the datacenter used by M&I to provide the ADP Services under this Agreement.


II. "Performance Standards" shall mean those service levels set forth in attached Schedule 9.1 for the provision of ADP Services.
------------


JJ. "Plan" shall have the meaning set forth in Section 20.1 of this Agreement.


KK. "Proper Instructions" shall mean those instructions sent to M&I in accordance with Section 3.3 of this Agreement.


LL. "Services" shall mean the services, functions and responsibilities described in this Agreement to be performed by M&I during the Term and shall include New Services which are agreed to by the parties in writing.


MM. "Taxes" shall mean any manufacturers, sales, use, gross receipts, excise, personal property or similar tax or duty assessed by any governmental or quasi-governmental authority upon or as a result of the execution or performance of any service pursuant to this Agreement or materials furnished with respect to this Agreement, except any income, franchise, privilege or like tax on or measured by M&I's net income, capital stock or net worth.


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NN. "Term" shall mean the Initial Term and any extension thereof, unless this Agreement is earlier terminated in accordance with its provisions.


OO. "Termination Assistance" shall have the meaning set forth in Section 12.1 of this Agreement.


PP. "Termination Fee" shall have the meaning set forth on attached Schedule 11.1. - -------------


QQ. "Third Party" shall mean any Entity other than the parties or any Affiliates of the parties.


RR. "User Manuals" shall mean the documentation provided by M&I to Customer which describes the features and functionalities of each of the ADP Services as modified and updated by the customer bulletins distributed by M&I from time to time.


1.3 References. In this Agreement and the schedules and exhibits attached
---------- hereto, which are hereby incorporated and deemed a part of this Agreement, references and mention of the word "include" and "including" shall mean "includes, without limitation" and "including, without limitation", as applicable.


1.4 Interpretation. In the event of a conflict between this Agreement and
-------------- the terms of any exhibits and schedules attached hereto, the terms of the schedules and exhibits shall prevail and control the interpretation of the Agreement. The exhibits and schedules together with the Agreement shall be interpreted as a single document.


2. TERM


2.1 Initial Term. This Agreement shall commence on the Effective Date and
------------ end on the seventh (7/th/) anniversary of the last day of the month in which the Commencement Date occurs ("Initial Term").


2.2 Extensions. Unless this Agreement has been earlier terminated, at
---------- least one (1) year prior to the expiration of the Initial Term, M&I shall submit to Customer a written proposal for renewal of this Agreement. Customer will respond to such proposal within three (3) months following receipt and inform M&I in writing whether or not Customer desires to renew this Agreement. If, on or prior to expiration of such three (3) month period: (1) Customer


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(a) elects to terminate, or (b) has failed to respond, then this Agreement shall terminate as scheduled upon expiration of the Initial Term; or (2) Customer elects to renew this Agreement, but M&I and Customer are unable to agree upon the terms for renewal of this Agreement prior to the expiration of the Initial Term, then this Agreement shall be automatically renewed for one (1) twelve- month period at M&I's then-current standard prices. Thereafter, this Agreement shall expire unless further renewed in writing by the parties.


3. APPOINTMENT


3.1 Performance by M&I Affiliates or Subcontractors. Customer understands
----------------------------------------------- and agrees that Marshall & Ilsley Corporation is a bank holding company and that the actual performance of the Services may be made by the divisions or subsidiaries of Marshall & Ilsley Corporation, Affiliates Controlled by Marshall & Ilsley Corporation, or subcontractors of any of the foregoing Entities (collectively, the "Eligible Providers"). For purposes of this Agreement, performance of the Services by any Eligible Provider shall be deemed performance by Marshall & Ilsley Corporation itself. M&I shall remain fully responsible for the performance or non-performance of each Eligible Provider under this Agreement, to the same extent if M&I itself performed or failed to perform such services.


3.2 Third Party Products/Services. The parties acknowledge that certain
----------------------------- services and products necessary for the performance of the Services are being, and in the future may be, provided by Third Parties who will contract directly with Customer. M&I shall have no liability to Customer for information and products supplied by, or services performed by, such Third Parties in conjunction with the Services, but M&I shall cooperate with such Third Parties as appropriate.


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3.3 Proper Instructions. "Proper Instructions" shall mean those
------------------- instructions sent to M&I by letter, memorandum, telegram, cable, telex, telecopy facsimile, computer terminal, e-mail or other "on line" system or similar means of communication or given orally over the telephone or given in person by one or more of the person(s) whose name(s) and signature(s) are listed on the most recent certificate delivered by Customer to M&I which lists those persons authorized to give orders, corrections and instructions in the name of and on behalf of Customer. Proper Instructions shall specify the action requested to be taken or omitted.


4. CONVERSION


4.1 Implementation of Services. The parties agree to use their best
-------------------------- efforts to perform the Conversion(s) such that the Commencement Date occurs on or before August 30, 1999.


4.2 Development of Conversion Plan. M&I has, in consultation with
------------------------------ Customer, developed a detailed, customized plan for the Conversion (the "Conversion Plan"). The Conversion Plan includes (i) a description of the tasks to be performed for the Conversion; (ii) allocation of responsibility for each of such tasks; and (iii) the schedule on which each task is to be performed. The Conversion project leaders for each party shall regularly communicate on the progress of the Conversion, the feasibility of the Conversion Dates specified in the Conversion Plan, and such other matters which may affect the smooth transition of the Services. Customer agrees to maintain an adequate staff of persons who are knowledgeable about the banking, data processing and information technology systems currently used by Customer. Each party agrees to provide such services and to perform such obligations as are specified as its responsibility in the Conversion Plan and as necessary for it to timely an ...