PLEDGE AGREEMENT
Exhibit 10.2
THIS PLEDGE AGREEMENT, dated as of June 9, 2008, is from ANCHOR BANCORP WISCONSIN, INC., a
Wisconsin corporation (the “Pledgor”), and U.S. BANK NATIONAL ASSOCIATION, as agent for the Lenders
under the Credit Agreement referred to below (the “Secured Party”).
RECITALS
Pledgor and Secured Party acknowledge the following:
A. Pledgor is the legal and beneficial owner of 100% of the issued and outstanding stock of
AnchorBank, fsb (the “Pledged Shares”).
B. Pursuant to an Amended and Restated Credit Agreement dated as of June 9, 2008 (as amended,
revised, supplemented or restated from time to time, the “Credit Agreement”) among the Pledgor, the
Lenders (as defined therein) and the Secured Party, as agent for the Lenders, the Lenders are
providing certain credit facilities to the Pledgor. Capitalized terms not defined herein shall
have the meanings ascribed to them in the Credit Agreement.
C. A Lender may enter into an interest rate swap or swaps with the Company pursuant to an ISDA
Master Agreement, Schedule and one or more Confirmations (as amended, revised, supplemented or
restated from time to time, collectively, the “Swap Documents”).
D. It is a condition precedent to the Lenders entering into the Credit Agreement and the Swap
Documents that Pledgor enter into this Pledge Agreement.
AGREEMENTS
NOW, THEREFORE, in consideration of the Recitals and to induce the Lenders to enter into the
Credit Agreement and provide the credit facilities to Pledgor and to induce any Lender to enter
into the Swap Documents, and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Pledgor hereby agrees as follows:
1. Pledge of Security. Pledgor hereby pledges and assigns to Secured Party, and
hereby grants to Secured Party, for itself and as agent for the Lenders, a security interest in all
of Pledgor’s right, title and interest in and to the following (the “Pledged Collateral”):
(a) the Pledged Shares and the certificates representing the Pledged Shares and any interest
of Pledgor in the entries on the books of the issuer or of any financial intermediary pertaining to
the Pledged Shares, and all dividends, cash, warrants, rights, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Pledged Shares; and
(b) to the extent not covered by clause (a) above, all proceeds of any or all of the foregoing
Pledged Collateral. For purposes of this Agreement, the term “proceeds” includes whatever is
receivable or received when Pledged Collateral or proceeds are sold, exchanged, collected or
otherwise disposed of, whether such disposition is voluntary or involuntary, and includes proceeds
of any indemnity or guaranty payable to Pledgor or Secured Party from time to time with respect to
any of the Pledged Collateral.
2. Security for Obligations. This Agreement secures, and the Pledged Collateral is
collateral security for, the prompt payment or performance in full when due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or otherwise (including the
payment of amounts that would become due but for the operation of the automatic stay under Section
362(a) of the Bankruptcy Code, 11 U.S.C. §362(a)), of all obligations and liabilities of every
nature of Pledgor to the Agent and the Lenders, now or hereafter existing under or arising out of
or in connection with the Loan Documents (as defined in the Credit Agreement), the Swap Documents
or this Agreement, and all extensions or renewals thereof, whether for principal, interest , fees,
expenses, indemnities or otherwise, whether voluntary or involuntary, direct or indirect, absolute
or contingent, liquidated or unliquidated, whether or not jointly owed with others, and whether or
not from time to time decreased or extinguished and later increased, created or incurred (all such
obligations of Pledgor being the “Secured Obligations”).
3. Delivery of Pledged Collateral. All certificates or instruments representing or
evidencing the Pledged Collateral have been, and for additional Pledged Collateral will be,
delivered to and held by Secured Party or such other bailee as directed by Secured Party, and shall
be in suitable form for transfer by delivery or, as applicable, shall be accompanied by Pledgor’s
endorsement, where necessary, or duly executed instruments of transfer or assignment in blank, all
in form and substance satisfactory to Secured Party. Upon the occurrence and during the
continuation of an Event of Default, Secured Party shall have the right, without notice to Pledgor,
to transfer to or to register in the name of Secured Party or any of its nominees any or all of the
Pledged Collateral, subject only to the revocable rights specified in Section 7(a). In addition,
Secured Party shall have the right at
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any time to exchange certificates or instruments representing or evidencing Pledged Collateral for
certificates or instruments of smaller or larger denominations.
4. Representations and Warranties. Pledgor represents and warrants to Secured Party
that:
(a) Due Authorization, Etc. of Pledged Collateral. All of the Pledged Shares have
been duly authorized and validly issued and are fully paid and non-assessable.
(b) Ownership of Pledged Collateral. Pledgor is the legal, record and beneficial
owner of all outstanding and currently existing Pledged Collateral, and will be the legal, record
and beneficial owner of all after-acquired Pledged Collateral, free and clear of any security
interest, lien or other encumbrance except for the security interest created by this Agreement.
5. Transfers and Other Liens. Pledgor shall:
(a) not (i) sell, assign (by operation of law or otherwise) or otherwise dispose of, or grant
any option with respect to, any of the Pledged Collateral, (ii) create or suffer to exist any
security interest, lien or other encumbrance upon or with respect to any of the Pledged Collateral,
except for the security interest created by this Agreement, or (iii) permit any issuer of Pledged
Shares to merge or consolidate unless all the outstanding capital stock of the surviving or
resulting corporation is, upon such merger or consolidation, pledged hereunder and no cash,
securities or other property is distributed in respect of the outstanding shares of any other
constituent corporation;
(b) promptly deliver to Secured Party all written notices received by Pledgor with respect to
the Pledged Collateral; and
(c) pay promptly when due all taxes, assessments and governmental charges or levies imposed
upon, and all claims against, the Pledged Collateral, except to the extent the validity thereof is
being contested in good faith; provided that Pledgor shall in any event pay such taxes,
assessments, charges, levies or claims not later than five days prior to the date of any proposed
sale under any judgment, writ or warrant of attachment entered or filed against Pledgor or any of
the Pledged Collateral as a result of the failure to make such payment.
6. Further Assurances. Pledgor agrees that from time to time, at the expense of
Pledgor, Pledgor will promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary or
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desirable, or that Secured Party may reasonably request, in order to perfect and protect any
security interest granted or purported to be granted hereby or to enable Secured Party to exercise
and enforce its rights and remedies hereunder with respect to any Pledged Collateral. Without
limiting the generality of the foregoing, Pledgor: (i) will promptly deliver to Secured Party any
stock certificates or other instruments constituting Pledged Collateral which Pledgor obtains after
the date of this Agreement, (ii) authorizes the Secured Party to file such financing or
continuation statements, or amendments thereto, and such other instruments or notices, as may be
necessary or desirable in order to perfect and preserve the security interests granted or purported
to be granted hereby and (iii) at the request of Secured Party, appear in and defend any action or
proceeding that may affect Pledgor’s title to or Secured Party’s security interest in all or any
part of the Pledged Collateral.
7. Voting Rights; Dividends; Etc.
(a) So long as no Event of Default shall have occurred and be continuing:
(i) Pledgor shall be entitled to exercise any and all voting and other consensual rights
pertaining to the Pledged Collateral or any part thereof for any purpose not inconsistent with the
terms of this Agreement or the Credit Agreement. It is understood, however, that neither (A) the
voting by Pledgor of any Pledged Shares for or Pledgor’s consent to the election of directors at a
regularly scheduled annual or other meeting of stockholders or with respect to incidental matters
at any such meeting nor (B) Pledgor’s consent to or approval of any action otherwise permitted
under this Agreement or the Credit Agreement, shall be deemed inconsistent with the terms of this
Agreement or the Credit Agreement within the meaning of this Section 7(a)(i);
(ii) Pledgor shall be entitled to receive and retain, and to utilize free and clear of the
lien of this Agreement, any and all dividends paid in respect of the Pledged Collateral including,
without limitation, dividends and other distributions paid or payable in cash in respect of any
Pledged Collateral in connection with a partial or total liquidation or dissolution or in
connection with a reduction of capital, capital surplus or paid-in-surplus; provided,
however, that any and all
[a] dividends paid or payable other than in cash in respect of, and instruments and other
property received, receivable or otherwise distributed in respect of, or in exchange for, any
Pledged Collateral, and
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[b] cash paid, payable or otherwise distributed in redemption of or in exchange for any
Pledged Collateral,
shall be, and shall forthwith be delivered to Secured Party to hold as, Pledged Collateral and
shall, if received by Pledgor, be received in trust for the benefit of Secured Party, be segregated
from the other property or funds of Pledgor and be forthwith delivered to Secured Party as Pledged
Collateral in the same form as so received (with all necessary endorsements); and
(iii) Secured Party shall promptly execute and deliver (or cause to be executed and delivered)
to Pledgor all such dividend payment orders and other instruments as Pledgor may from time to time
reasonably request for the purpose of enabling Pledgor to receive the dividends, principal or
interest payments which he is authorized to receive and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuation of an Event of Default:
(i) upon written notice from Secured Party, to Pledgor, all rights of Pledgor to exercise the
voting and other consensual rights which he would otherwise be entitled to exercise pursuant to
Section 7(a)(i) shall cease, and all such rights shall thereupon become vested in Secured Party who
shall thereupon have the sole right to exercise such voting and other consensual rights;
(ii) all rights of Pledgor to receive the dividends which he would otherwise be authorized to
receive and retain pursuant to Section 7(a)(ii) shall cease, and all such rights shall thereupon
become vested in Secured Party, who shall thereupon have the sole right to receive and hold as
Pledged Collateral such dividends; and
(iii) all dividends which are received by Pledgor contrary to the provisions of paragraph (ii)
of this Section 7(b) shall be received in trust for the benefit of Secured Party, shall be
segregated from other funds of Pledgor and shall forthwith be paid over to Secured Party as Pledged
Collateral in the same form as so received (with any necessary endorsements).
(c) In order to permit Secured Party to exercise the voting and other consensual rights which
it may be entitled to exercise pursuant to Section 7(b)(i) and to receive all dividends and other
distributions which Secured Party may be entitled to receive under Section 7(b)(ii), (i) Pledgor
shall promptly execute and deliver (or cause to be executed and delivered) to Secured Party all
such proxies, dividend payment orders and other instruments as Secured Party may from time to
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time reasonably request and (ii) without limiting the effect of the immediately preceding
clause (i), Pledgor hereby grants to Secured Party an irrevocable proxy to vote the Pledged Shares
and to exercise all other rights, powers, privileges and remedies to which a holder of the Pledged
Shares would be entitled (including giving or withholding written consents of shareholders, calling
special meetings of shareholders and voting at such meetings), which proxy shall be effective,
automatically and without the necessity of any action (including any transfer of any Pledged Shares
on the record books of the issuer thereof) by any other Person (including the issuer of the Pledged
Shares or any officer or agent thereof), upon the occurrence of an Event of Default and which proxy
shall only terminate upon either (a) waiver by the Secured Party of such Event of Default or (b)
the payment in full of the Secured Obligations.
8. Secured Party Appointed Attorney-in-Fact. Pledgor hereby irrevocably appoints
Secured Party as Pledgor’s attorney-in-fact, with full authority in the place and stead of Pledgor
and in the name of Pledgor, Secured Party or otherwise, from time to time in Secured Party’s
discretion to take any action and to execute any instrument that Secured Party may deem necessary
or advisable to accomplish the purposes of this Agreement, but consistent with the provisions and
limitations of this Agreement including:
(a) to ask, demand, collect, xxx for, recover, compound, receive and give acquittance and
receipts for moneys due and to become due under or in respect of any of the Pledged Collateral;
(b) to receive, endorse and collect any instruments made payable to Pledgor representing any
dividend or other distribution in respect of the Pledged Collateral or any part thereof and to give
full discharge for the same; and
(c) to file any claims or take any action or institute any proceedings that Secured Party may
deem necessary or desirable for the collection of any of the Pledged Collateral or otherwise to
enforce the rights of Secured Party with respect to any of the Pledged Collateral.
9. Secured Party May Perform. If Pledgor fails to perform any agreement contained
herein, Secured Party may itself perform, or cause performance of, such agreement, and the expenses
of Secured Party incurred in connection therewith shall be payable by Pledgor and shall constitute
Secured Obligations hereunder.
10. Standard of Care. The powers conferred on Secured Party hereunder are solely to
protect its interest in the Pledged Collateral and shall not impose any
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duty upon it to exercise any such powers. Except for the exercise of reasonable care in the
custody of any Pledged Collateral in its possession and the accounting for moneys actually received
by it hereunder, Secured Party shall have no duty as to any Pledged Collateral, it being understood
that Secured Party shall have no responsibility for (a) ascertaining or taking action with respect
to calls, conversions, exchanges, maturities, tenders or other matters relating to any Pledged
Collateral, whether or not Secured Party has or is deemed to have knowledge of such matters,
(b) taking any necessary steps (other than steps taken in accordance with the standard of care set
forth above to maintain possession of the Pledged Collateral) to preserve rights against any
parties with respect to any Pledged Collateral, (c) taking any necessary steps to collect or
realize upon the Secured Obligations or any guarantee therefor, or any part thereof, or any of the
Pledged Collateral, or (d) initiating any action to protect the Pledged Collateral against the
possibility of a decline in market value. Secured Party shall be deemed to have exercised
reasonable care in the custody and preservation of Pledged Collateral in its possession if such
Pledged Collateral is accorded treatment substantially equal to that which Secured Party accords
its own property consisting of negotiable securities.
11. Remedies.
(a) If any Event of Default shall have occurred and be continuing, Secured Party may exercise
in respect of the Pledged Collateral, in addition to all other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a secured party on default
under the Uniform Commercial Code as in effect in any relevant jurisdiction (the “Code”) (whether
or not the Code applies to the affected Pledged Collateral), and Secured Party may also in its sole
discretion, without notice except as specified below, sell the Pledged Collateral or any part
thereof in one or more parcels at public or private sale, at any exchange or broker’s board or at
any of Secured Party’s offices or elsewhere, for cash, on credit or for future delivery, at such
time or times and at such price or prices and upon such other terms as Secured Party may deem
commercially reasonable, irrespective of the impact of any such sales on the market price of the
Pledged Collateral. Secured Party may be the purchaser of any or all of the Pledged Collateral at
any such sale. Each purchaser at any such sale shall hold the property sold absolutely free from
any claim or right on the part of Pledgor, and Pledgor hereby waives (to the extent permitted by
applicable law) all rights of redemption, stay and/or appraisal which he now has or may at any time
in the future have under any rule of law or statute now existing or hereafter enacted. Pledgor
agrees that, to the extent notice of sale shall be required by law, at least ten days’ notice to
Pledgor of the time and place of any public sale or the time after which any private sale is to be
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made shall constitute reasonable notification. Secured Party shall not be obligated to make
any sale of Pledged Collateral regardless of notice of sale having been given. Secured Party may
adjourn any public or private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and place to which it was
so adjourned. If the proceeds of any sale or other disposition of the Pledged Collateral are
insufficient to pay all the Secured Obligations, Pledgor shall be liable for the deficiency and the
reasonable fees of any attorneys employed by Secured Party to collect such deficiency.
(b) Pledgor recognizes that, by reason of certain prohibitions contained in the Securities Act
and applicable state securities laws, Secured Party may be compelled, with respect to any sale of
all or any part of the Pledged Collateral conducted without prior registration or qualification of
such Pledged Collateral under the Securities Act and/or such state securities laws, to limit
purchasers to those who will agree, among other things, to acquire the Pledged Collateral for their
own account, for investment and not with a view to the distribution or resale thereof. Pledgor
acknowledges that any such private sales may be at prices and on terms less favorable than those
obtainable through a public sale without such restrictions (including a public offering made
pursuant to a registration statement under the Securities Act) and, notwithstanding such
circumstances, Pledgor agrees that Secured Party shall have no obligation to engage in public sales
and no obligation to delay the sale of any Pledged Collateral for the period of time necessary to
permit the issuer thereof to register it for a form of public sale requiring registration under the
Securities Act or under applicable state securities laws, even if such issuer would, or should,
agree to so register it.
(c) If Secured Party determines to exercise its right to sell any or all of the Pledged
Collateral, upon written request, Pledgor shall and shall cause each issuer of any Pledged Shares
to be sold hereunder from time to time to furnish to Secured Party all such information as Secured
Party may request in order to determine the number of shares and other instruments included in the
Pledged Collateral which may be sold by Secured Party in exempt transactions under the Securities
Act and the rules and regulations of the Securities and Exchange Commission thereunder, as the same
are from time to time in effect.
12. Application of Proceeds. Except as expressly provided elsewhere in this Agreement,
all proceeds received by Secured Party in respect of any sale of, collection from, or other
realization upon all or any part of the Pledged Collateral shall be applied by Secured Party,
unless otherwise required by law, to expenses incurred by the Secured Party in protecting or
enforcing its rights under this
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Agreement (including without limitation reasonable attorneys’ fees and all expenses of taking
possession, storing, holding, preparing for disposition and disposing of the Collateral) and to the
Secured Obligations in such order and amounts as elected by the Secured Party.
13. Indemnity and Expenses.
(a) Pledgor agrees to indemnify Secured Party from and against any and all claims, losses and
liabilities in any way relating to, growing out of or resulting from this Agreement and the
transactions contemplated hereby (including enforcement of this Agreement), except to the extent
such claims, losses or liabilities result solely from Secured Party’s gross negligence or willful
misconduct as finally determined by a court of competent jurisdiction.
(b) Pledgor shall pay to Secured Party upon demand the amount of any and all costs and
expenses, including the reasonable fees and expenses of its counsel and of any experts and agents,
that Secured Party may incur in connection with (i) the administration of this Agreement, (ii) the
custody or preservation of, or the sale of, collection from, or other realization upon, any of the
Pledged Collateral, (iii) the exercise or enforcement of any of the rights of Secured Party
hereunder, or (iv) the failure by Pledgor to perform or observe any of the provisions hereof.
14. Continuing Security Interest. This Agreement shall create a continuing security
interest in the Pledged Collateral and shall (a) remain in full force and effect until the payment
in full of all Secured Obligations, (b) be binding upon Pledgor, his successors and assigns, and
(c) inure, together with the rights and remedies of Secured Party hereunder, to the benefit of
Secured Party and its successors, transferees and assigns. Upon the final payment in full of all
Secured Obligations and the termination of any commitment on the part of the Secured Party to make
advances to Pledgor, the security interest granted hereby shall terminate and all rights to the
Pledged Collateral shall revert to Pledgor. Upon any such termination Secured Party will, at
Pledgor’s reasonable expense, promptly execute and deliver to Pledgor such documents as Pledgor
shall reasonably request to evidence such termination and Pledgor shall be entitled to the return,
upon his request and at his expense, against receipt and without recourse to Secured Party, of such
of the Pledged Collateral as shall not have been sold or otherwise applied pursuant to the terms
hereof.
15. Amendments; Etc. No amendment, modification, termination or waiver of any
provision of this Agreement, and no consent to any departure by Pledgor therefrom, shall in any
event be effective unless the same shall be in
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writing and signed by Secured Party and, in the case of any such amendment or modification, by
Pledgor. Any such waiver or consent shall be effective only in the specific instance and for the
specific purpose for which it was given.
16. Notices. All notices provided for herein shall be in writing and shall be sent in
the manner and to the address specified in the Credit Agreement; such notices shall be deemed given
when delivered, mailed or transmitted.
17. Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or delay on the
part of Secured Party in the exercise of any power, right or privilege hereunder shall impair such
power, right or privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege preclude any other
or further exercise thereof or of any other power, right or privilege. All rights and remedies
existing under this Agreement are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
18. Severability. In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability
of the remaining provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
19. Headings. Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this Agreement for any other
purpose or be given any substantive effect.
20. Governing Law; Terms; Rules of Construction. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF WISCONSIN, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES, EXCEPT TO THE EXTENT THAT THE CODE PROVIDES THAT THE PERFECTION OF THE SECURITY
INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR PLEDGED COLLATERAL ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF WISCONSIN. Unless otherwise defined
herein or in the Credit Agreement, terms used in Articles 8 and 9 of the Uniform Commercial Code in
the State of Wisconsin are used herein as therein defined.
21. Counterparts. This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which
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when so executed and delivered shall be deemed an original, but all such counterparts together
shall constitute but one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all signature pages are
physically attached to the same document.
22. Effect on Existing Pledge Agreement. This Agreement amends, restates, supercedes
and replaces the Existing Pledge Agreement in its entirety and the parties agree that the security
interest in certain collateral created under the Existing Pledge Agreement is continued in such
collateral by this Pledge Agreement.
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IN WITNESS WHEREOF, Pledgor has caused this Agreement to be duly executed and delivered as of
the date first written above.
| ANCHOR BANCORP WISCONSIN, INC. | ||||||
| BY | ||||||
| Name: | ||||||
| Title: | ||||||
Pledge Agreement Signature Page
