REVOLVING CREDIT AGREEMENT dated as of May 27, 2008 between FNB UNITED CORP. as Borrower and SUNTRUST BANK as Lender
Exhibit
10.42
CONFORMED
COPY
dated as
of May 27, 2008
between
as
Borrower
and
SUNTRUST
BANK
as
Lender
TABLE
OF CONTENTS
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Page
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ARTICLE
I. DEFINITIONS; CONSTRUCTION
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1
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Section
1.1.
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Definitions
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1
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Section
1.2.
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Accounting
Terms and Determination
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8
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Section
1.3.
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Terms
Generally
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9
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ARTICLE
II. AMOUNT AND TERMS OF THE REVOLVING
COMMITMENT
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9
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Section
2.1.
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Revolving
Loans and Revolving Credit Note
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9
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Section
2.2.
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Procedure
for Revolving Loans
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9
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Section
2.3.
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Optional
Reduction and Termination and/or Extension of Revolving
Commitment
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9
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Section
2.4.
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Repayment
and Prepayments of Revolving Loans
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10
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Section
2.5.
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Interest
on Loans
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10
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Section
2.6.
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Intentionally
Omitted
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11
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Section
2.7.
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Computation
of Interest
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11
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Section
2.8.
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Inability
to Determine Interest Rates
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11
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Section
2.9.
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Illegality
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11
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Section
2.10.
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Increased
Costs
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11
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Section
2.11.
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Payments
Generally
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12
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Section
2.12.
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Funding
Indemnity
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12
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ARTICLE
III. CONDITIONS PRECEDENT TO REVOLVING LOANS
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12
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Section
3.1.
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Conditions
to Initial Revolving Loan
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12
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Section
3.2.
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Each
Revolving Loan
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13
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ARTICLE
IV. REPRESENTATIONS AND WARRANTIES
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13
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Section
4.1.
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Existence;
Power
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14
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Section
4.2.
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Organizational
Power; Authorization
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14
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Section
4.3.
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Governmental
Approvals; No Conflicts
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14
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Section
4.4.
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Financial
Statements
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14
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Section
4.5.
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Litigation
Matters
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14
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Section
4.6.
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Compliance
with Laws and Agreements
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14
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Section
4.7.
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Investment
Company Act, Etc.
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15
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Section
4.8.
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Taxes
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15
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Section
4.9.
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Margin
Regulations
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15
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Section
4.10.
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ERISA
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15
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Section
4.11.
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Disclosure
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15
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Section
4.12.
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Subsidiaries
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15
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Section
4.13.
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Dividend
Restrictions; Other Restrictions
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15
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Section
4.14.
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Capital
Measures
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16
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Section
4.15.
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FDIC
Insurance
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16
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Section
4.16.
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OFAC
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16
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Section
4.17.
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Patriot
Act.
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16
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i
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ARTICLE
V. AFFIRMATIVE COVENANTS
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16
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Section
5.1.
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Financial
Statements and Other Information
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16
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Section
5.2.
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Notices
of Material Events
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18
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Section
5.3.
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Existence;
Conduct of Business
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18
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Section
5.4.
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Compliance
with Laws, Etc.
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18
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Section
5.5.
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Books
and Records.
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18
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Section
5.6.
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Visitation,
Inspection, Etc.
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19
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Section
5.7.
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Maintenance
of Properties; Insurance
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19
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Section
5.8.
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Use
of Proceeds
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19
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ARTICLE
VI. FINANCIAL COVENANTS
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19
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Section
6.1.
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Return
on Average Assets
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19
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Section
6.2.
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Ratio
of Nonperforming Assets to Total Loans and OREO
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19
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Section
6.3.
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Capital
Measures
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19
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ARTICLE
VII. NEGATIVE COVENANTS
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20
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Section
7.1.
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Indebtedness
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20
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Section
7.2.
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Negative
Pledge
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21
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Section
7.3.
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Fundamental
Changes
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21
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Section
7.4.
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Restricted
Payments
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22
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Section
7.5.
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Restricted
Agreements
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22
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Section
7.6
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Investments,
Etc
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22
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ARTICLE VIII. EVENTS
OF DEFAULT
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23
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Section
8.1.
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Events
of Default
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23
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ARTICLE
IX. MISCELLANEOUS
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25
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Section
9.1.
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Notices
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25
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Section
9.2.
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Waiver;
Amendments
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26
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Section
9.3.
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Expenses;
Indemnification
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27
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Section
9.4.
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Successors
and Assigns
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28
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Section
9.5.
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Governing
Law; Jurisdiction; Consent to Service of Process
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29
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Section
9.6.
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Waiver
of Jury Trial
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29
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Section
9.7.
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Right
of Setoff
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29
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Section
9.8.
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Counterparts;
Integration
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29
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Section
9.9.
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Survival
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29
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Section
9.10.
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Severability
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29
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Section
9.11.
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Interest
Rate Limitation
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30
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Section
9.12.
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Patriot
Act
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30
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ii
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Schedules
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Schedule
4.5
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-
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Litigation
Matters
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Schedule
4.12
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-
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Financial
Institution Subsidiaries
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Exhibits
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Exhibit
A
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-
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Revolving
Credit Note
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Exhibit
2.2
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-
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Notice
of Revolving Borrowing
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iii
THIS REVOLVING CREDIT AGREEMENT
(this "Agreement") is made and entered into
as of May 27, 2008, by and between FNB UNITED CORP., a North
Carolina corporation (the “Borrower”), and
SUNTRUST BANK, a Georgia banking corporation (the "Lender").
W I T N E S S E T
H:
WHEREAS, the Borrower has
requested the Lender, and the Lender has agreed, subject to the terms and
conditions of this Agreement, to establish a 364-day revolving credit facility
in an original principal amount of $10,000,000;
NOW, THEREFORE, in
consideration of the premises and the mutual covenants herein contained, the
Borrower and the Lender agree as follows:
ARTICLE
I
DEFINITIONS;
CONSTRUCTION
Section 1.1. Definitions. In
addition to the other terms defined herein, the following terms used herein
shall have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):
“Acquisition”
shall mean any transaction or a series of related transactions for the
purpose of, or resulting, directly or indirectly, in (a) the acquisition of all
or substantially all of the assets of a Person, or of any business or division
of any Person, (b) the acquisition of greater than 50% of the capital stock,
partnership interest, membership interest or other equity of any Person, or
otherwise causing a Person to become a Subsidiary, or (c) a merger or
consolidation of, or any other combination with, another Person (other than a
Person that is a Subsidiary), provided that the Borrower or any Subsidiary is
the surviving entity.
“Affiliate”
shall mean, as to any Person, any other Person that directly, or indirectly
through one or more intermediaries, Controls, is Controlled by, or is under
common Control with, such Person.
“Availability
Period” shall mean the period from the Closing Date to the Commitment
Termination Date.
“Base Rate”
shall mean the higher of (i) the per annum rate which the Lender publicly
announces from time to time to be its prime lending rate, as in effect from time
to time, and (ii) the Federal Funds Rate, as in effect from time to time,
plus one-half of one
percent (0.50%). The Lender's prime lending rate is a reference rate and does
not necessarily represent the lowest or best rate charged to
customers. The Lender may make commercial loans or other loans at
rates of interest at, above or below the Lender's prime lending
rate. Each change in the Lender’s prime lending rate shall be
effective from and including the date such change is publicly announced as being
effective.
“Base Rate
Loan” shall mean a Revolving Loan which bears interest at the Base
Rate.
“Business
Day” shall mean (i) any day other than a Saturday, Sunday or other day on
which commercial banks in Atlanta, Georgia are authorized or required by law to
close and (ii) if such day relates to a borrowing or continuation of, a payment
or prepayment of principal or interest on, or an Interest Period for,
a
1
Eurodollar
Loan or a notice with respect thereto, any day on which dealings in Dollars are
carried on in the London interbank market.
“Call
Report” shall
mean, with respect to Financial Institution Subsidiary, the “Consolidated
Reports of Condition and Income” (FFIEC Form 031 or 041 or any successor form of
the Federal Financial Institutions Examination Council).
“Change in
Control” shall mean (a) with respect to the Borrower, the
occurrence of one or more of the following events: (i) any sale, lease, exchange
or other transfer (in a single transaction or a series of related transactions)
of all or substantially all of the assets of the Borrower to any Person or
"group" (within the meaning of the Securities Exchange Act of 1934 and the rules
of the Commission thereunder in effect on the date hereof), (ii) the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or "group" (within the meaning of the Securities Exchange Act of 1934
and the rules of the Commission thereunder as in effect on the date hereof) of
25% or more of the outstanding shares of the voting stock of the Borrower or
(iii) occupation of a majority of the seats (other than vacant seats) on the
board of directors of the Borrower by Persons who were neither (A) nominated by
the current board of directors or (B) appointed by directors so nominated, or
(b) the Borrower shall own, directly or indirectly, less than 100% of the voting
stock of any Financial Institution Subsidiary.
“Change in
Law” shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any applicable
law, rule or regulation, or any change in the interpretation or application
thereof, by any Governmental Authority after the date of this Agreement, or
(iii) compliance by the Lender (or for purposes of Section 2.10(b), by the Lender’s
holding company, if applicable) with any request, guideline or directive
(whether or not having the force of law) of any Governmental Authority made or
issued after the date of this Agreement.
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“Closing
Date” shall mean the date on which the conditions precedent set
forth in Section
3.1 and Section 3.2
have been satisfied or waived in accordance with Section 9.2,
and unless otherwise indicated, shall be the date of this
Agreement.
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“Code”
shall mean the Internal Revenue Code of 1986, as amended and in effect from time
to time.
“Commission”
shall mean the Securities and Exchange Commission, and any successor
thereto.
“Commitment
Termination Date” shall mean May 22, 2009, or such later date as the
Revolving Commitment has been extended pursuant to Section 2.3, or earlier if
terminated pursuant to Section 2.3 or Section
8.1.
“Control”
shall mean the power, directly or indirectly, to direct or cause the
direction of the management and policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. The terms "Controlling",
"Controlled
by", and "under common
Control with" have meanings correlative thereto.
“Default”
shall mean any condition or event that, with the giving of notice or the lapse
of time or both, would constitute an Event of Default.
"Default
Interest" shall have the meaning set forth in Section 2.5(b).
“Dollar(s)”
and the sign "$" shall
mean lawful money of the United States of America.
2
“Environmental
Laws” shall mean all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by or with any Governmental Authority, relating in
any way to the environment, preservation or reclamation of natural resources,
the management, Release or threatened Release of any Hazardous Material or to
health and safety matters.
“Environmental
Liability” shall mean any liability, contingent or otherwise (including
any liability for damages, costs of environmental investigation and remediation,
costs of administrative oversight, fines, natural resource damages, penalties or
indemnities), of the Borrower or any Subsidiary directly or indirectly resulting
from or based upon (a) any actual or alleged violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) any actual or alleged exposure to any
Hazardous Materials, (d) the Release or threatened Release of any Hazardous
Materials or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any successor statute.
“ERISA
Affiliate” shall mean any trade or business (whether or not
incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.
"ERISA
Event" shall
mean (a) any “reportable event”, as defined in Section 4043 of ERISA or the
regulations issued thereunder with respect to a Plan (other than an event for
which the 30-day notice period is waived); (b) the existence with respect to any
Plan of an “accumulated funding deficiency” (as defined in Section 412 of the
Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(d) of the Code or Section 303(d) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan; (e) the receipt
by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator
appointed by the PBGC of any notice relating to an intention to terminate any
Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence
by the Borrower or any of its ERISA Affiliates of any liability with respect to
the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g)
the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt
by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any
notice, concerning the imposition of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is expected to be, insolvent or in
reorganization, within the meaning of Title IV of ERISA.
“Eurodollar
Loan” shall mean a Revolving Loan which bears interest at a rate
determined by reference to LIBOR.
“Event of
Default” shall have the meaning provided in
Article VIII.
“Federal Funds
Rate” shall mean, for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%)
equal to the weighted average of the rates on overnight Federal funds
transactions with member banks of the Federal Reserve System arranged by Federal
funds brokers, as published by the Federal Reserve Bank of New York on the next
succeeding Business Day or if such rate is not so published for any Business
Day, the Federal Funds Rate for such day shall be the average rounded upwards,
if necessary, to the next 1/100th of 1% of the quotations for such day on such
transactions received by the Lender from three Federal funds brokers of
recognized standing selected by the Lender.
3
“Financial
Institution Subsidiary” shall mean each of (a) CommunityONE Bank,
National Association, a national banking association, and (b) each other
Subsidiary of the Borrower existing on the Closing Date or thereafter formed or
acquired that is a depository institution with FDIC-insured
deposits.
“Fiscal Quarter”
shall mean each fiscal quarter (including the fiscal quarter at the
fiscal year-end) of the Borrower and its Subsidiaries.
“FR Report
Y-9C” shall mean the “Consolidated Financial Statements for Bank Holding
Companies-FR Y-9C” submitted by the Borrower as required by Section 5(c) of the
Bank Holding Company Act (12 U.S.C. 1844) and Section 225.5(b) of Regulation Y
[12 CFR 225.5(b)], or any successor or similar replacement report.
“FR Report
Y9-LP” shall mean the “Parent Company Only Financial Statements for Large
Bank Holding Companies-FR Y-9LP” submitted by the Borrower as required by
Section 5(c) of the Bank Holding Company Act (12 U.S.C. 1844) and Section
225.5(b) of Regulation Y [12 CFR 225.5(b)], or any successor or similar
replacement report.
“GAAP”
shall mean generally accepted accounting principles in the United States
applied on a consistent basis and subject to the terms of Section
1.2.
“Governmental
Authority” shall mean the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
“Hazardous
Materials” means
all explosive or radioactive substances or wastes and all hazardous or toxic
substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated
biphenyls, radon gas, infectious or medical wastes and all other substances or
wastes of any nature regulated pursuant to any Environmental Law.
“Hedging
Agreements”
shall mean interest rate swap, cap or collar agreements, interest rate future or
option contracts, currency swap agreements, currency future or option contracts,
foreign exchange contracts (forward and/or spot), commodity agreements and other
similar agreements or arrangements designed to protect against fluctuations in
interest rates, currency values or commodity values.
“Indebtedness”
of any Person shall mean, without duplication (i) all obligations of
such Person for borrowed money, (ii) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii) all obligations of
such Person in respect of the deferred purchase price of property or services
(other than trade payables incurred in the ordinary course of business), (iv)
all obligations of such Person under any conditional sale or other title
retention agreement(s) relating to property acquired by such Person,
(v) all obligations of such Person under capital leases and all monetary
obligations of such Person under Synthetic Leases, (vi) all obligations,
contingent or otherwise, of such Person in respect of letters of credit,
acceptances or similar extensions of credit, (vii) all guarantees by such
Person of Indebtedness of others, (viii) all Indebtedness of a third party
secured by any Lien on property owned by such Person, whether or not such
Indebtedness has been assumed by such Person, (ix) all obligations of such
Person, contingent or otherwise, to purchase, redeem, retire or otherwise
acquire for value any common stock of such Person, and (x) all net obligations
incurred by such Person under Hedging Agreements.
“Interest
Period” shall mean, with
respect to any Eurodollar Loan, a period of three months, provided
that:
4
(i) the
initial Interest Period for any such Loan shall commence on the date of such
Loan and each Interest Period occurring thereafter in respect of such Loan shall
commence on the day on which the next preceding Interest Period
expires;
(ii) if
any Interest Period would otherwise end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day,
unless such Business Day falls in another calendar month, in which case such
Interest Period would end on the next preceding Business Day;
(iii) any
Interest Period which begins on the last Business Day of a calendar month or on
a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period shall end on the last Business Day of
such subsequent calendar month;
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(iv)
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no
Interest Period may extend beyond the Commitment Termination Date.
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“Investments”
shall have the meaning set forth in Section 7.6
hereof.
"LIBOR "
shall mean for any applicable Interest Period with respect to a Eurodollar
Loan, that rate per annum that is equal to the quotient
of:
(i) the
rate per annum equal to the London interbank offered rate for deposits in U.S.
dollars for a three-month period, which rate appears on Reuters Screen LIBOR01
Page (or any successor page), or such similar service as determined by the
Lender that displays British Bankers' Association interest settlement rates for
deposits in U.S. Dollars, as of 11:00 A.M. (London, England time) two (2)
Business Days prior to the first day of such Interest Period; provided, that if no
such offered rate appears on such page, the rate used will be the per annum rate
of interest determined by the Lender to be the rate at which U.S. dollar
deposits for a three-month period are offered to the Lender in the London
Inter-Bank Market as of 10:00 A.M. (Atlanta, Georgia time), on
the day which is two (2) Business Days prior to the first day of such Interest
Period, divided by
(ii) a
percentage equal to 1.00 minus
the maximum reserve percentages (including any emergency, supplemental,
special or other marginal reserves) expressed as a decimal (rounded upward to
the next 1/100th of 1%) in effect on any day to which the Bank is subject with
respect to any Eurodollar loan pursuant to regulations issued by the Board of
Governors of the Federal Reserve System with respect to eurocurrency funding
(currently referred to as "eurocurrency liabilities" under Regulation
D). This percentage will be adjusted automatically on and as of the
effective date of any change in any reserve percentage.
“Lien”
shall mean any mortgage, pledge, security interest, lien (statutory or
otherwise), charge, encumbrance, hypothecation, assignment, deposit arrangement,
or other arrangement having the practical effect of the foregoing or any
preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having the same economic
effect as any of the foregoing).
"Loan
Documents" shall mean, collectively, this Agreement, the Revolving
Credit Note, any Hedging Agreement entered into with Lender
in connection with the Indebtedness under this Agreement or the Revolving Credit
Note and any and all other instruments, agreements, documents and writings
executed by the Borrower in connection with any of the
foregoing.
5
“Material Adverse
Effect” shall mean, with respect to any event, act, condition or
occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
singly or in conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences whether or not related, a material
adverse change in, or a material adverse effect on, (i) the business,
results of operations, financial condition, assets, or
liabilities of the Borrower and of the Borrower and its Subsidiaries
taken as a whole , (ii) the ability of the Borrower to perform any of its
obligations under the Loan Documents, (iii) the rights and remedies of the
Lender under any of the Loan Documents or (iv) the legality, validity or
enforceability of any of the Loan Documents.
“Multiemployer
Plan” shall have the meaning set forth in Section 4001(a)(3) of
ERISA.
"Nonperforming
Assets" shall mean the sum of (a) Nonperforming Loans, (b) nonaccrual
investment securities and (c) Other Real Estate Owned (determined in accordance
with, and as set forth on, Borrower’s FR Report Y-9C).
“Nonperforming
Loans” shall mean the sum of (a) nonaccrual loans and lease financing
receivables, (b) loans and lease financing receivables that are contractually
past due 90 days or more as to interest or principal and are still accruing
interest and (c) loans for which the terms have been modified due to a
deterioration in the financial position of the Borrower (determined in
accordance with, and as set forth on, Borrower’s FR Report Y-9C).
“Notice of
Borrowing” shall have the meaning as set forth in Section
2.2.
“Obligations”
shall mean all amounts owing by the Borrower to the Lender pursuant to or in
connection with this Agreement or any other Loan Document, including without
limitation, all principal, interest (including any interest accruing after the
filing of any petition in bankruptcy or the commencement of any insolvency,
reorganization or like proceeding relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding),
all reimbursement obligations, all net obligations under Hedging
Agreements, fees, expenses, indemnification and reimbursement payments, costs
and expenses (including all fees and expenses of counsel to the Lender incurred
pursuant to this Agreement or any other Loan Document), whether direct or
indirect, absolute or contingent, liquidated or unliquidated, now existing
or hereafter arising hereunder or thereunder, together with all renewals,
extensions, modifications or refinancings thereof.
“Other Real Estate
Owned” shall mean the sum of (a) real estate acquired in satisfaction of
debts previously contracted and (b) other real estate owned, as set forth on
Schedule HC-M of Borrower’s FR Report Y-9C.
“Participant”
shall have the meaning set forth in Section 9.4(c).
“Payment
Office” shall mean the office of the Lender located at 000 Xxxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxx 00000, or such other location as to which the Lender
shall have given written notice to the Borrower.
“PBGC” shall mean the Pension
Benefit Guaranty Corporation referred to and defined in ERISA, and any
successor entity performing similar functions.
“Permitted
Encumbrances” shall mean
6
(i) Liens
imposed by law for taxes not yet due or which are being contested in good faith
by appropriate proceedings and with respect to which adequate reserves are being
maintained in accordance with GAAP;
(ii) statutory
Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen
and other Liens imposed by law created in the ordinary course of business for
amounts not yet due or which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being maintained in
accordance with GAAP;
(iii) pledges
and deposits made in the ordinary course of business in compliance with workers'
compensation, unemployment insurance and other social security laws or
regulations;
(iv) deposits
to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of
business;
(v) judgment
and attachment liens not giving rise to an Event of Default or Liens created by
or existing from any litigation or legal proceeding that are currently being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves are being maintained in accordance with GAAP;
and
(vi) easements,
zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure
any monetary obligations and do not materially detract from the value of the
affected property or materially interfere with the ordinary conduct of business
of the Borrower and its Subsidiaries taken as a whole;
provided, that the
term “Permitted Encumbrances” shall not include any Lien securing
Indebtedness.
“Person”
shall mean any individual, partnership, firm, corporation, association, joint
venture, limited liability company, trust or other entity, or any Governmental
Authority.
“Plan”
means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.
“Regulation D”
shall mean Regulation D of the Board of Governors of the Federal Reserve
System, as the same may be in effect from time to time, and any successor
regulations.
“Release”
means any release, spill, emission, leaking, dumping, injection, pouring,
deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within any building, structure, facility or
fixture.
“Responsible
Officer" shall mean any of the president, the chief executive officer,
the chief operating officer, the chief financial officer, the treasurer or a
vice president of the Borrower or such other representative of the Borrower as
may be designated in writing by any one of the foregoing with the consent of the
Lender; and, with respect to the financial covenants only, the chief financial
officer or the treasurer of the Borrower.
“Revolving
Commitment”
shall mean the obligation of the Lender to make Revolving Loans to the Borrower
in an aggregate principal amount not exceeding $10,000,000.
7
“Revolving
Loan” shall mean a loan made by the Lender to the Borrower under its
Revolving Commitment, which will at all times be a Eurodollar Loan except under
circumstances set forth in Section 2.8 or Section 2.9
hereof.
“Revolving Credit
Note” shall mean a promissory note of the Borrower payable to the order
of the Lender in the principal amount of the Revolving Commitment, in
substantially the form of Exhibit
A.
“Subsidiary”
shall mean, with respect to any Person (the “parent”),
any corporation, partnership, joint venture, limited liability company,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, partnership, joint venture, limited
liability company, association or other entity (i) of which
securities or other ownership interests representing more than 30% of
the equity or more than 30% of the ordinary voting power,
or in the case of a partnership, more than 30% of the general partnership
interests are, as of such date, owned, Controlled or held, or (ii) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent. Unless
otherwise indicated, all references to "Subsidiary" hereunder shall mean a
Subsidiary of the Borrower.
“Synthetic
Lease” of any Person shall mean (a) a lease designed to have the
characteristics of a loan for federal income tax purposes while obtaining
operating lease treatment for financial accounting purposes, or (b) an agreement
for the use or possession of property creating obligations that are not required
to appear on the balance sheet of such Person but which, upon the insolvency or
bankruptcy of such Person would be characterized by a court of competent
jurisdiction as indebtedness of such Person.
“Tangible Net
Worth” shall mean, as of any date, the total shareholders’ equity of the
Borrower and its Subsidiaries that would be reflected on the Borrower's
consolidated balance sheet as of such date prepared in accordance with GAAP,
minus
the amount of all assets of the Borrower and its Subsidiaries that would be
classified as intangible assets (including without limitation goodwill and net
core deposit intangible) on the Borrower’s consolidated balance sheet as of such
date prepared in accordance with GAAP.
“Total
Loans” shall mean for the Borrower on a consolidated basis the line
item “Loans net of unearned income” set forth on the Borrower’s
consolidated balance sheet delivered pursuant to Section 5.1(a) and (b).
“Withdrawal
Liability” shall mean liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.
Section 1.2. Accounting
Terms and Determination. Unless otherwise defined or
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with GAAP as
in effect from time to time, applied on a basis consistent (except for such
changes approved by the Borrower's independent public accountants) with the most
recent audited consolidated financial statement of the Borrower delivered
pursuant to Section
5.1(a);
provided, that
if the Borrower notifies the Lender that the Borrower wishes to amend any
covenant in Article VI to eliminate the effect of any change in GAAP on the
operation of such covenant (or if the Lender notifies the Borrower
that it wishes to amend Article VI for such purpose), then the Borrower's
compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to
the Borrower and the Lender.
8
Section 1.3. Terms
Generally. The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined. The words "include", "includes" and "including" shall be
deemed to be followed by the phase "without limitation". In the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the word "to" means "to but
excluding". Unless the context requires otherwise (i) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as it was
originally executed or as it may from time to time be amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein), (ii) any reference herein to any Person
shall be construed to include such Person's successors and permitted assigns,
(iii) the words "hereof", "herein" and "hereunder" and words of similar import
shall be construed to refer to this Agreement as a whole and not to any
particular provision hereof, (iv) all references to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles, Sections,
Exhibits and Schedules to this Agreement and (v) all references to a
specific time shall be construed to refer to the time in the city and state of
the Lender's principal office, unless otherwise indicated.
ARTICLE II
AMOUNT AND TERMS OF THE
REVOLVING COMMITMEN
Section 2.1. Revolving
Loans and Revolving Credit Note. (a) Subject to the terms and
conditions set forth herein, the Lender agrees to make Revolving Loans to the
Borrower, from time to time during the Availability Period, in
an aggregate principal amount outstanding at any time not to exceed the
Revolving Commitment. During the Availability Period, the Borrower shall be
entitled to borrow, prepay and reborrow Revolving Loans in accordance with the
terms and conditions of this Agreement; provided, that
the Borrower may not borrow or reborrow should there exist a Default or Event of
Default.
(b) The
Borrower's obligation to pay the principal of, and interest on, Revolving Loans
shall be evidenced by the records of the Lender and by the Revolving Credit
Note. The entries made in such records and/or on the schedule annexed
to the Revolving Credit Note shall be prima facie evidence of the
existence and amounts of the obligations of the Borrower therein recorded; provided, that the
failure or delay of the Lender in maintaining or making entries into any such
record or on such schedule or any error therein shall not in any manner affect
the obligation of the Borrower to repay the Revolving Loans (both principal and
unpaid accrued interest) in accordance with the terms of this
Agreement.
Section
2.2. Procedure
for Revolving Loans. The Borrower shall give the Lender
written notice (or telephonic notice promptly confirmed in writing) of each
Revolving Loan substantially in the form of Exhibit 2.2 (a "Notice of
Borrowing") prior to 11:00 a.m. two (2) Business Days prior to which a
Revolving Loan is being requested. Each Notice of Borrowing shall be irrevocable
and shall specify:
(i) the principal amount of the Revolving Loan, (ii) the proposed date of the
Revolving Loan (which shall be a Business Day), and (iii) if the
Revolving Loan is $1,000,000 or greater, its purpose (provided in sufficient
detail that is reasonably satisfactory to the
Lender). The aggregate principal amount of each Revolving Loan shall
be not less than $500,000 or a larger multiple of $100,000, or in such lesser
amounts equal to the amount of the unused Revolving Commitment. Upon the
satisfaction of the applicable conditions set forth in Article III hereof, the
Lender will make the proceeds of each Revolving Loan available to the Borrower
at the Payment Office on the date specified in the applicable Notice of
Borrowing by crediting an account maintained by the Borrower with the Lender or
at the Borrower’s option, by effecting a wire transfer of such amount to an
account designated by the Borrower to the Lender.
Section 2.3. Optional
Reduction and Termination and/or Extension of Revolving
Commitment.
9
(a) The
Revolving Commitment shall terminate on the Commitment Termination Date; provided, that the
Commitment Termination Date may be extended by the Lender for additional 364-day
periods in its sole discretion upon receiving a written request from the
Borrower not earlier than 60 days and not later than 45 days prior to then
existing Commitment Termination Date for an extension. Upon the receipt of such
request, the Lender shall use its best efforts to notify the Borrower not later
than 30 days prior to any Commitment Termination Date whether it will extend the
then existing Commitment Termination Date for an additional 364-day period;
provided, that
the failure of the Lender to give any such notice to the Borrower shall mean
that the then existing Commitment Termination Date will not be so
extended.
(b) Upon
at least two (2) Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) to the Lender (which notice shall be
irrevocable), the Borrower may reduce the Revolving Commitment in part or
terminate the Revolving Commitment in whole; provided, that (i)
any partial reduction pursuant to this Section 2.3 shall be
in an amount of at least $100,000 and any larger multiple of $50,000 and (ii) no
such reduction shall be permitted which would reduce the Revolving Commitment
(after giving effect thereto and any concurrent prepayments made under Section 2.4) to an
amount less than the outstanding Revolving Loans.
Section 2.4. Repayment
and Prepayments of Revolving Loans.
(a) The
outstanding principal amount of all Revolving Loans shall be due and payable
(together with accrued and unpaid interest thereon) on the Commitment
Termination Date.
(b) The
Borrower shall have the right at any time and from time to time to prepay any
Eurodollar Loan, in whole or in part, without premium or penalty, subject to
Section 2.12
hereof. Each partial prepayment shall be in an amount not less than $100,000 and
integral multiples thereof.
(c) Subject
to Sections 2.8
and 2.9, each
Eurodollar Loan shall automatically continue on the last day of an Interest
Period for another three-month Interest Period unless the Borrower elects to
repay in whole or in part such Eurodollar Loan on the last day of such Interest
Period. In the case of a partial repayment, such Eurodollar Loan shall be
continued for another one-month Interest Period in the principal amount
designated by the Borrower, subject to the minimum amounts specified in Section
2.2.
Section 2.5. Interest
on Loans.
(a) The
Borrower shall pay interest on each Eurodollar Loan at LIBOR, plus 1.50% per annum. If a
Base Rate Loan shall be outstanding under the circumstances set forth in Section 2.8 or 2.9, then the
Borrower shall pay interest on each Base Rate Loan at the Base Rate in effect
from time to time.
(b) While
an Event of Default exists or after acceleration, at the option of the Lender,
the Borrower shall pay interest ("Default
Interest") with respect to all Eurodollar Loans at the rate otherwise
applicable for the then-current Interest Period plus an additional 2% per
annum until the last day of such Interest Period, and thereafter, and with
respect to all Base Rate Loans and all other Obligations hereunder, at the Base
Rate, plus 2% per
annum.
(c) Interest
on the principal amount of all Revolving Loans shall accrue from and
including the date such Revolving Loans are made to but excluding the date
of any repayment thereof. Interest on all outstanding Eurodollar Loans
shall be payable on the last day of each Interest Period applicable thereto and
on the Commitment Termination Date. Interest on any Base Rate Loans shall be
payable on the last day of each calendar month and on the Commitment Termination
Date. All Default Interest shall be payable on demand.
10
(d) The
Lender shall determine each interest rate applicable to the Revolving Loans
hereunder and shall promptly notify the Borrower of such rate in writing (or by
telephone, promptly confirmed in writing). Any such
determination shall be conclusive and binding for all purposes, absent manifest
error.
Section 2.6. Intentionally
Omitted.
Section 2.7. Computation
of Interest. All computations of interest hereunder shall be made on the
basis of a year of 360 days for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or fees are payable (to the extent computed on the basis of days
elapsed). Each determination by the Lender of an interest amount hereunder shall
be made in good faith and, except for manifest error, shall be final,
conclusive and binding for all purposes.
Section
2.8. Inability
to Determine Interest Rates. If prior to the commencement of
any Interest Period for any Eurodollar Loan, the Lender shall have determined
(which determination shall be conclusive and binding upon the Borrower) that (a) by reason of
circumstances affecting the relevant interbank market, adequate means do
not exist for ascertaining LIBOR, or (b) LIBOR does not adequately and fairly
reflect the cost to the Lender of making, funding or maintaining its Eurodollar
Loans, the Lender shall give written notice (or telephonic notice, promptly
confirmed in writing) to the Borrower as soon as practicable thereafter. Until
the Lender notifies the Borrower that the circumstances giving rise to such
notice no longer exist, (x) the obligation of the Lender to make Eurodollar
Loans or to continue outstanding Revolving Loans as Eurodollar Loans shall be
suspended and (y) all such affected Eurodollar Loans shall be converted into
Base Rate Loans on the last day of the then current Interest Period unless the
Borrower elects to prepay such Revolving Loans in accordance with this
Agreement.
Section 2.9. Illegality. If any Change in
Law shall make it unlawful or impossible for the Lender to make, maintain or
fund any Eurodollar Loan, the Lender shall promptly give notice thereof to the
Borrower, whereupon until the Lender notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the obligation of
the Lender to make Eurodollar Loans, or to continue any outstanding Revolving
Loans as Eurodollar Loans, shall be suspended. Any new Revolving Loan shall be
made as a Base Rate Loan and all then outstanding Eurodollar Loans shall be
converted to a Base Rate Loan either (x) on the last day of the then current
Interest Period if the Lender may lawfully continue to maintain such Eurodollar
Loans to such date or (y) immediately if the Lender shall determine that it may
not lawfully continue to maintain such Eurodollar Loans to such
date.
Section 2.10. Increased
Costs.
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(a)
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If
any Change in Law shall:
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(i)
impose,
modify or deem applicable any reserve, special deposit or similar requirement
that is not otherwise included in the determination of LIBOR hereunder against
assets of, deposits with or for the account of, or credit extended by, the
Lender (except any such reserve requirement reflected in the calculation of
LIBOR); or
(ii) impose
on the Lender or the eurodollar interbank market any other condition affecting
this Agreement or any Eurodollar Loans made by the Lender; and the result of the
foregoing is to increase the cost to the Lender of making, continuing or
maintaining a Eurodollar Loan or to reduce the amount received or receivable by
the Lender hereunder (whether of principal, interest or any other amount), then
the Borrower shall promptly pay, upon written notice from and demand by the
Lender, within five Business Days after the date of such notice and demand,
additional amount or amounts sufficient to compensate the Lender for such
additional costs incurred or reduction suffered.
11
(b) If
the Lender shall have determined that on or after the date of this Agreement any
Change in Law regarding capital requirements has or would have the effect
of reducing the rate of return on the Lender's capital (or on the capital of the
Lender's parent corporation) as a consequence of its obligations hereunder
to a level below that which the Lender or the Lender's parent corporation could
have achieved but for such Change in Law (taking into consideration the Lender's
policies or the policies of the Lender's parent corporation with respect to
capital adequacy) then, from time to time, within five (5) Business Days after
receipt by the Borrower of written demand by the Lender, the Borrower shall
pay to the Lender such additional amounts as will compensate the Lender or the
Lender's parent corporation for any such reduction suffered.
(c) A
certificate of the Lender setting forth the amount or amounts necessary to
compensate the Lender or its parent corporation, as the case may be, specified
in paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive, absent manifest error. The Borrower shall
pay the Lender such amount or amounts within 10 days after receipt
thereof.
(d) Failure
or delay on the part of the Lender to demand compensation pursuant to this
Section shall not constitute a waiver of the Lender's right to demand such
compensation.
Section
2.11. Payments
Generally. The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, or of amounts payable under Section 2.10 or otherwise) prior to
12:00 noon, on the date when due, in immediately available funds, without
set-off or counterclaim. Any amounts received after such time on any date may,
in the discretion of the Lender, be deemed to have been received on the next
succeeding Business Day for purposes of calculating interest
thereon. All such payments shall be made to the Lender at its Payment
Office. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be made payable for the period of such extension. All
payments hereunder shall be made in Dollars.
Section 2.12. Funding
Indemnity. In the event of (a) the payment of any principal of
a Eurodollar Loan other than on the last day of the Interest Period applicable
thereto (including as a result of an Event of Default), or (b) the failure by
the Borrower to borrow, prepay, or continue any Eurodollar Loan on the date
specified in any applicable notice (regardless of whether such notice is
withdrawn or revoked), then, in any such event, the Borrower shall
compensate the Lender, within five (5) Business Days after written demand from
the Lender, for any loss, cost or expense attributable to such event.
In the case of a Eurodollar Loan, such loss, cost or expense shall be deemed to
include an amount determined by the Lender to be the excess, if any,
of (A) the amount of interest that would have accrued on the
principal amount of such Eurodollar Loan if such event had not occurred at LIBOR
applicable to such Eurodollar Loan for the period from the date of such event to
the last day of the then current Interest Period therefor (or in the case of a
failure to borrow or continue, for the period that would have been the Interest
Period for such Eurodollar Loan) over (B) the amount of interest that would
accrue on the principal amount of such Eurodollar Loan for the same period if
LIBOR were set on the date such Eurodollar Loan was prepaid or converted or the
date on which the Borrower failed to borrow or continue
such Eurodollar Loan. A certificate as to any
additional amount payable under this Section 2.12
submitted to the Borrower by the Lender shall be conclusive, absent
manifest error.
ARTICLE
III
CONDITIONS PRECEDENT TO
REVOLVING LOANS
Section
3.1. Conditions
To Initial Revolving Loan. The obligation of the Lender to
make the initial Revolving Loan hereunder is subject to the receipt by the
Lender of the following documents in form and substance reasonably satisfactory
to the Lender:
12
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(a)
|
this
Agreement duly executed and delivered by the
Borrower;
|
|
(b)
|
a
duly executed Revolving Credit
Note;
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(c) a
certificate of the Secretary or Assistant Secretary of the Borrower,
attaching and certifying copies of its bylaws and of the resolutions of its
board of directors, authorizing the execution, delivery and performance of the
Loan Documents and certifying the name, title and true signature of each officer
of the Borrower authorized to execute the Loan Documents;
(d) certified
copies of the articles of incorporation of the Borrower, together with good
standing certificates (or the equivalent) as may be available from the
Secretary of State of the jurisdiction of incorporation of the Borrower and each
Subsidiary (and in the case of a Financial Institution Subsidiary which is a
national bank, from the Office of the Comptroller of the Currency) and each
other jurisdiction where the Borrower or such Subsidiary (other than a Financial
Institution Subsidiary which is a national bank) is required to be qualified to
do business as a foreign corporation;
(e) a
favorable written opinion of Xxxxxx Xxxx Xxxxxx Xxxx & Xxxxxxxxxx
PLLC, counsel to the Borrower, addressed to the Lender, and covering such
matters relating to the Borrower, the Loan Documents and the transactions
contemplated therein as the Lender shall reasonably request; and
(f) a
duly executed funds disbursement agreement.
Section
3.2. Each
Revolving Loan. The
obligation of the Lender to make each Revolving Loan is subject to the
satisfaction of the following conditions:
(a) at
the time of and immediately after giving effect to such Revolving Loan, no
Default or Event of Default shall exist;
(b) all
representations and warranties of the Borrower herein shall be true
and correct in all material respects on and as of the date of such Revolving
Loan both before and after giving effect thereto;
(c) since
December 31, 2007, there shall have been no change which has had or could
reasonably be expected to have a Material Adverse Effect;
(d) the
Lender shall have received a duly executed Notice of Borrowing in accordance
with Section
2.2 hereof; and
(e) the
Lender shall have received such other documents, certificates,
information or legal opinions as it may reasonably request, all in form and
substance reasonably satisfactory to the Lender.
The making of each Revolving Loan shall
be deemed to constitute a representation and warranty by the Borrower on the
date thereof as to the matters specified in paragraphs (a), (b) and (c) of this
Section 3.2.
ARTICLE IV
REPRESENTATIONS AND
WARRANTIES
The
Borrower represents and warrants to the Lender as follows:
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Section 4.1. Existence;
Power. (a) Each of the Borrower and its Subsidiaries (other than
Community ONE Bank, any subsidiary organized as a Delaware or Connecticut
statutory trust in connection with the issuance of trust preferred securities
and Premier Investment Services, Inc. which is in the process of being
dissolved) (i) is duly organized, validly existing and in good
standing as a corporation under the laws of the jurisdiction of its
organization, (ii) has all requisite power and authority to carry on its
business as now conducted, and (iii) is duly qualified to do business, and
is in good standing, in each jurisdiction where such qualification is required,
except where a failure to be so qualified could not reasonably be expected to
result in a Material Adverse Effect.
(b)
CommunityONE Bank, National Association, is a national bank chartered under the
laws of the United States and has all requisite power and authority to carry on
its business as now conducted.
Section 4.2. Organizational
Power; Authorization. The execution, delivery and performance
by the Borrower of each of the Loan Documents are within the Borrower’s
corporate powers and have been duly authorized by all necessary corporate, and
if required, stockholder, action. This Agreement has been duly executed and
delivered by the Borrower and constitutes, and each other Loan Document when
executed and delivered by the Borrower will constitute, valid and binding
obligations of the Borrower, enforceable against it in accordance with
their respective terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting the
enforcement of creditors' rights generally and by general principles of
equity.
Section 4.3. Governmental
Approvals; No Conflicts. The execution, delivery and performance by the
Borrower of this Agreement and the other Loan Documents (a) do not
require any consent or approval of, registration or filing with, or any action
by, any Governmental Authority, except those as have been obtained or made and
are in full force and effect, (b) will not violate any applicable law or
regulation or the articles of incorporation or by-laws of the Borrower or any
order of any Governmental Authority, (c) will not violate or result in a default
under any indenture, material agreement or other material instrument binding on
the Borrower or any of its Subsidiaries or any of its assets or give rise to a
right thereunder to require any payment to be made by the Borrower or any of its
Subsidiaries and (d) will not result in the creation or imposition of any Lien
on any asset of the Borrower or any of its Subsidiaries, except Liens (if any)
created under the Loan Documents.
Section 4.4. Financial
Statements. The Borrower has furnished to the Lender the
consolidated balance sheet of the Borrower and its Subsidiaries as of
December 31, 2007 and the related consolidated statements of income, of
shareholders' equity and comprehensive income and of cash flows for the fiscal
year then ended, each as audited by Xxxxx Xxxxxx PLLC. Such financial
statements fairly present, in all material respects, the consolidated financial
position of the Borrower and its Subsidiaries as of such date and the
consolidated results of operations and cash flows for such period in
conformity with GAAP consistently applied. Since December 31, 2007, there have
been no changes with respect to the Borrower and its Subsidiaries which have had
or could reasonably
be expected to have, singly or in the aggregate, a Material Adverse
Effect.
Section 4.5. Litigation
Matters. Except as set forth on Schedule 4.5 attached hereto,
no litigation, investigation or proceeding of or before any arbitrators or
Governmental Authorities is pending against, or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination that could reasonably be expected to have, either individually or
in the aggregate, a Material Adverse Effect or (ii) which in any manner draws
into question the validity or enforceability of this Agreement or any other Loan
Document.
14
Section 4.6. Compliance
with Laws and Agreements. The Borrower and each Subsidiary is
in compliance with (a) all applicable laws (including without limitation all
federal and state banking statutes) and all rules, regulations (including
without limitation all federal and state banking regulations) and orders of any
Governmental Authority, and (b) all indentures, agreements or other instruments
binding upon it or its properties, except in each case where non-compliance,
either singly or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
Section 4.7. Investment
Company Act. Neither the Borrower nor any of its Subsidiaries
is an "investment company", as defined in, or subject to regulation under, the
Investment Company Act of 1940, as amended.
Section 4.8. Taxes. The
Borrower and its Subsidiaries have timely filed or caused to be filed all
Federal income tax returns and all other material tax returns that are
required to be filed by them, and have paid all taxes shown to be due and
payable on such returns or on any assessments made against it or its property
and all other taxes, fees or other charges imposed on it or any of its property
by any Governmental Authority, except (i) to the extent the failure to do so
would not have a Material Adverse Effect or (ii) where the same are
currently being contested in good faith by appropriate proceedings and for
which the Borrower or such Subsidiary, as the case may be, has set aside on its
books adequate reserves.
Section 4.9. Margin
Regulations. None of the proceeds of any of the Revolving
Loans will be used for "purchasing" or "carrying" any "margin stock" with the
respective meanings of each of such terms under Regulation U as now and from
time to time hereafter in effect or for any purpose that violates the provisions
of Regulation U.
Section 4.10. ERISA. No
ERISA Event has occurred or is reasonably expected to occur that, when taken
together with all other such ERISA Events for which liability is reasonably
expected to occur, could reasonably be expected to result in a Material Adverse
Effect. The present value of all accumulated benefit obligations
under each Plan (based on the assumptions used for purposes of Statement of
Financial Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than
$500,000 the fair market value of the assets of all such Plan, and
the present value of all accumulated benefit obligations of all underfunded
Plans (based on the assumptions used for purposes of Statement of Financial
Standards No. 87) did not, as of the date of the most recent
financial statements reflecting such amounts, exceed by more than $500,000 the fair market value of
the assets of all such underfunded Plans.
Section 4.11. Disclosure.
The Borrower has disclosed to the Lender all agreements, instruments, and
corporate or other restrictions to which the Borrower or any of its Subsidiaries
is subject, and all other matters known to any of them, that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect. None of the reports (including without limitation all reports
that the Borrower is required to file with the Commission), financial
statements, certificates or other information furnished by or on behalf of the
Borrower to the Lender in connection with the negotiation of this Agreement or
any other Loan Document or delivered hereunder or thereunder (as modified or
supplemented by any other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, taken as a whole, in light of the circumstances under which
they were made, not misleading.
Section 4.12. Subsidiaries.
Schedule 4.12 sets forth the name of, the ownership interest of the Borrower in,
and the jurisdiction of incorporation of, each Financial Institution Subsidiary
and each other Subsidiary (other than any subsidiary organized as a Delaware or
Connecticut statutory trust in connection with the issuance of trust preferred
securities and Premier Investment Services, Inc. which is in the process of
being dissolved), in each case as of the Closing Date.
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Section 4.13. Dividend
Restrictions; Other Restrictions. (a) No Financial Institution
Subsidiary has violated any applicable regulatory restrictions on dividends, and
no Governmental Authority has taken any action to restrict the payment of
dividends by any Financial Institution Subsidiary.
(b) Neither the Borrower nor any
Subsidiary is under investigation by, or is operating under any restrictions
(excluding any restrictions on the payment of dividends referenced in subsection
(a) above) imposed by or agreed to with, any Governmental Authority, other than
routine examinations by such Governmental Authorities.
Section 4.14. Capital
Measures. On the Closing
Date, both the Borrower and each Financial Institution Subsidiary have been, or
are deemed to have been, notified by the appropriate Governmental Authority
having regulatory authority over each of them that each of them is “adequately
capitalized”, as determined in accordance with any regulations
established by such Governmental Authority.
Section 4.15. FDIC
Insurance. The
deposits of each Financial Institution Subsidiary that is an “insured depository
institution” (within the meaning of § 12 U. S. C. 1831(c)) are insured by the
FDIC and no act has occurred that would adversely affect the status of such
Financial Institution Subsidiary as an FDIC insured bank.
Section 4.16. OFAC. Neither the Borrower nor any
of its Subsidiaries (i) is a person whose property or interest in property is
blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of
September 23, 2001 Blocking Property and Prohibiting Transactions With Persons
Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079
(2001)), (ii) engages in any dealings or transactions prohibited by Section 2 of
such executive order, or is otherwise associated with any such person in any
manner violative of Section 2 or (iii) is a person on the list of Specially
Designated Nationals and Blocked Persons or subject to the limitations or
prohibitions under any other U.S. Department of Treasury’s Office of Foreign
Assets Control regulation or executive order.
Section 4.17. Patriot
Act. Each of the
Borrower and its Subsidiaries is in compliance, in all material respects, with
(i) the Trading with the Enemy Act, as amended, and each of the foreign
assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) and any other enabling legislation or
executive order relating thereto and (ii) the Uniting And Strengthening America
By Providing Appropriate Tools Required To Intercept And Obstruct Terrorism (USA
Patriot Act of 2001). No part of the proceeds of the Revolving Loans
will be used, directly or indirectly, for any payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as
amended.
ARTICLE V
AFFIRMATIVE
COVENANTS
The
Borrower covenants and agrees that so long as the Lender has a Revolving
Commitment hereunder or the principal of and interest on any Revolving Loan or
any fee remains unpaid:
Section 5.1. Financial
Statements and Other Information. The Borrower will deliver to the
Lender:
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(a) as
soon as available and in any event within 90 days after the end of each fiscal
year of Borrower, a copy of the annual audited report for such fiscal year for
the Borrower and its Subsidiaries, containing a consolidated balance sheet and
the related consolidated statements of income, of shareholders' equity and
comprehensive income, and of cash flows (together with all footnotes thereto),
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail and reported on by independent public
accountants of nationally recognized standing (without a "going concern" or like
qualification, exception or explanation and without any qualification
or exception as to scope of such audit) to the effect that such
financial statements present fairly in all material respects the financial
condition and the results of operations and cash flows on a consolidated basis
of the Borrower for such fiscal year in accordance with GAAP and that the
examination by such accountants in connection with
such financial statements has been made in accordance with generally
accepted auditing standards; provided, that the
requirements set forth in this clause (a) may be fulfilled by providing to the
Lender the report of the Borrower to the Commission on Form 10-K for the
applicable fiscal year;
(b) as
soon as available and in any event within 45 days after the end of each of
the first three fiscal quarters of each fiscal year of the Borrower, an
unaudited balance sheet of the Borrower and its Subsidiaries on a consolidated
basis as of the end of such fiscal quarter and the related unaudited statements
of income and cash flows of the Borrower and its Subsidiaries on a
consolidated basis for such fiscal quarter and the then elapsed portion of such
fiscal year, setting forth in each case in comparative form the figures for the
corresponding quarter and the corresponding portion of Borrower's previous
fiscal year, all certified by the chief financial officer or treasurer of the Borrower as
presenting fairly in all material respects the financial condition and results
of operations of the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP, subject to normal year-end audit adjustments and the
absence of footnotes; provided, that the
requirements set forth in this clause (b) may be fulfilled by providing to the
Lender the report of the Borrower to the Commission on Form 10-Q for the
applicable fiscal quarter;
(c) concurrently
with the delivery of the financial statements referred to in clauses (a) and (b)
above, a certificate of a Responsible Officer, (i) certifying as to whether
there exists a Default or Event of Default on the date of such certificate,
and if a Default or an Event of Default then exists, specifying the details
thereof and the action which the Borrower has taken or proposes to take with
respect thereto, and (ii) setting forth in reasonable detail calculations
demonstrating compliance with Article VI;
(d) concurrently
with the delivery of the financial statements referred to in clauses (a) and (b)
above, duly executed copies of the Borrower’s then-current FR Report Y-9C and FR
Report Y-9LP and a duly executed copy of the then-current Call Report for each
Financial Institution Subsidiary;
(e) promptly
after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials filed with the Commission, or any
Governmental Authority succeeding to any or all functions of said Commission, or
with any national securities exchange, or distributed by the Borrower to its
shareholders generally, as the case may be; and
(f) promptly
following any request therefor, such other information regarding the results of
operations, business affairs and financial condition of the Borrower
or any Subsidiary as the Lender may reasonably request.
Documents
required to be delivered pursuant to Section 5.1(a) or (b) or Section 5.1(e) that are filed
with, or furnished to, the Commission electronically shall be deemed to have
been delivered to the Lender on the date (i) on which the Borrower posts such
documents or provides a link thereto on the Borrower’s website on the internet
at the website address set forth in Section 9.1 or (ii)
on which such documents are posted on the Borrower’s behalf on an internet or
intranet website, if any, to which the Lender has access; provided, that (A)
the Borrower shall deliver paper copies of such documents to the Lender if the
Lender so requests in writing
17
until a
further written notice is received by the Borrower from the Lender to cease
delivering paper copies and (B) the Borrower shall notify (which may be by
facsimile or electronic mail) the Lender of the posting of any such documents.
Notwithstanding anything contained herein, in every instance the Borrower shall
be required to provide paper copies of the certificates required to
be delivered pursuant to Section 5.1(c)
hereof.
Section 5.2. Notices
of Material Events. The Borrower will furnish to the Lender
prompt written notice of the following:
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(a)
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the
occurrence of any Default or Event of
Default;
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(b) the
filing or commencement of any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or, to the knowledge of the
Borrower, affecting the Borrower or any Subsidiary which could reasonably be
expected to result in a Material Adverse Effect;
(c) the
occurrence of any ERISA Event that alone, or together with any other ERISA
Events that have occurred, could reasonably be expected to result in liability
of the Borrower and its Subsidiaries in an aggregate amount exceeding
$500,000;
(d) any
material investigation of the Borrower or any Subsidiary by any Governmental
Agency having regulatory authority over the Borrower or any such Subsidiary
(other than routine examinations of the Borrower and/or any such
Subsidiary);
(e) the
issuance of any cease and desist order, written agreement, cancellation of
insurance or other public enforcement action by the FDIC or other Governmental
Authority having regulatory authority over the Borrower or any
Subsidiary;
(f) the
issuance of any memorandum of understanding or proposed disciplinary action by
or from any Governmental Authority having regulatory authority over the Borrower
or any Subsidiary, to the extent that the Borrower or any such Subsidiary is
permitted to disclose such information (provided that the Borrower shall take
all reasonable efforts to obtain any necessary regulatory
consents);
(g) any
other development that results in, or could reasonably be expected to result in,
a Material Adverse Effect.
Each notice delivered under this
Section shall be accompanied by a written statement of a Responsible Officer
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.
Section 5.3. Existence;
Conduct of Business. The Borrower will, and will cause each of
its Subsidiaries to, do or cause to be done all things necessary to preserve,
renew and maintain in full force and effect its legal existence and its
respective rights, licenses, permits, privileges, franchises, patents,
copyrights, trademarks and trade names material to the conduct of its business
and will continue to engage in the same business as presently conducted or such
other businesses that are reasonably related thereto; provided, that
nothing in this Section shall prohibit any merger, consolidation, liquidation or
dissolution permitted under Section
7.3.
Section 5.4. Compliance
with Laws, Etc. The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and requirements of
any Governmental Authority (including without limitation all federal and state
banking statutes and regulations) applicable to its assets, except where the
failure to do so, either individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect.
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Section 5.5. Books and
Records. The Borrower will, and will cause each of its Subsidiaries to,
keep proper books
of record and account in which full, true and correct entries shall be made of
all dealings and transactions in relation to its business and activities to the
extent necessary to prepare the consolidated financial statements of Borrower in
conformity with GAAP.
Section 5.6. Visitation,
Inspection, Etc. The Borrower will, and will cause each of its
Subsidiaries to, permit any representative of the Lender to visit and inspect
its properties, to examine its books and records and to make copies and take
extracts therefrom, and to discuss its affairs, finances and accounts
with any of its officers and with its independent certified public accountants,
all at such reasonable times and as often as the Lender may reasonably
request after reasonable prior notice to the Borrower.
Section 5.7. Maintenance
of Properties; Insurance.
(a) The Borrower will, and will cause each of its Subsidiaries to, (i) keep and
maintain all property material to the conduct of its business in good working
order and condition, ordinary wear and tear excepted, except where
the failure to do so, either individually or it the aggregate, could not
reasonably be expected to result in a Material Adverse Effect and (ii) maintain
with financially sound and reputable insurance companies, insurance with respect
to its properties and business, and the properties and business of its
Subsidiaries, against loss or damage of the kinds customarily insured against by
companies in the same or similar businesses operating in the same or similar
locations.
(b) The
deposits of each Financial Institution Subsidiary will at all times be insured
by the Federal Deposit Insurance Corporation (“FDIC”).
Section 5.8. Use of
Proceeds . The Borrower will use the proceeds of all Revolving
Loans for general working capital purposes. No part of the proceeds of any
Revolving Loan will be used, whether directly or indirectly, for any purpose
that would violate any rule or regulation of the Board of Governors of the
Federal Reserve System, including Regulation T, U or X.
ARTICLE
VI
FINANCIAL
COVENANTS
The
Borrower covenants and agrees that so long as the Lender has its Revolving
Commitment hereunder or the principal of or interest on or any Revolving Loan
remains unpaid or any fee remains unpaid:
Section 6.1. Return on
Average Assets. The Borrower on a consolidated basis will have at the end
of each Fiscal Quarter a Return on Average Assets (determined by reference to
the Borrower’s Form 10-Q or 10-K) of not less than 0.50%, determined by taking
the sum of the Return on Average Assets for such Fiscal Quarter and the previous
three Fiscal Quarters, divided by four
(4).
Section 6.2. Ratio of
Nonperforming Assets to Total Loans and OREO. The Borrower on a
consolidated basis will not permit at the end of each Fiscal Quarter
Nonperforming Assets (determined by reference to the Borrower’s FRY-9C Report)
to be greater than 2.00% of the sum of Total Loans (excluding loans held for
sale and determined by reference to the Borrower’s Form 10-Q or 10-K) and Other
Real Estate Owned (determined by reference to the Borrower’s FRY-9C
Report).
Section 6.3. Capital
Measures. (a) The
Borrower will have a Total Risk-based Capital Ratio of 9.50% or greater, a Tier
1 Risk-based Capital Ratio of 6.0% or greater, and a Tier 1Leverage Capital
Ratio of 5.0% or greater (each as defined by applicable federal and
state regulations or orders), and will not be subject to any written agreement,
order, capital directive or prompt corrective action directive by
any
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Governmental
Authority having regulatory authority over the Borrower or (ii) if required by
any Governmental Authority having regulatory authority over the Borrower, will
have such higher amounts of Total Risk-based Capital and Tier 1 Risk-based
Capital and/or such greater Leverage Capital Ratio as specified by such
Governmental Authority.
(b) Not later than three (3) months
after the Closing Date, each Financial Institution Subsidiary will be “well
capitalized” for all applicable state and federal regulatory purposes at all
times, and such Financial Institution Subsidiary (i) will have a
Total Risk-based Capital Ratio of 10.0% or greater, a Tier 1
Risk-based Capital Ratio of 6.0% or greater, and a Tier 1 Leverage Capital Ratio
of 5.0% or greater (each as defined by applicable federal and state regulations
or orders) and not be subject to any written agreement, order, capital directive
or prompt corrective action directive by any Governmental Authority having
regulatory authority over such Financial Institution Subsidiary or (ii) if
required by any Governmental Authority having regulatory authority over such
Financial Institution Subsidiary in order to remain “well
capitalized” and in compliance with all applicable regulatory requirements, will
have such higher amounts of Total Risk-based Capital and Tier 1 Risk-based
Capital and/or such greater Leverage Ratio as specified by such Governmental
Authority. For the period beginning on the Closing Date and ending three (3)
months thereafter, each Financial Institution Subsidiary (i) will
have a Total Risk-based Capital Ratio of 9.5% or greater, a Tier 1
Risk-based Capital Ratio of 6.0% or greater, and a Tier 1 Leverage Capital Ratio
of 5.0% or greater (each as defined by applicable federal and state regulations
or orders) and not be subject to any written agreement, order, capital directive
or prompt corrective action directive by any Governmental Authority having
regulatory authority over such Financial Institution Subsidiary.
(c) Notwithstanding the foregoing, if
at any time any such Governmental Authority changes the definition of “well capitalized” either by
amending such ratios or otherwise, such amended definition, and any such amended
or new ratios, shall automatically be incorporated by reference into this
Agreement as the minimum standard for the Borrower (except with respect to it
Total Risk-based Capital Ratio, in which case the Lender has the right to amend
such ratio in subparagraph (a) above in its sole discretion) or any Financial
Institution Subsidiary, as the case may be, on and as of the date that any such
amendment becomes effective by applicable statute, regulation, order or
otherwise.
ARTICLE VII
NEGATIVE
COVENANTS
The
Borrower covenants and agrees that so long as the Lender has its Revolving
Commitment hereunder or the principal of or interest on any Revolving Loan
remains unpaid or any fee remains unpaid:
Section 7.1. Indebtedness.
The Borrower will not, and will not permit any of its Subsidiaries to, create,
incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness
created pursuant to the Loan Documents;
(b) Indebtedness
of Financial Institution Subsidiaries (i) to the Federal Reserve Board or to the
Federal Home Loan Bank Board, (ii) constituting federal funds purchased and
securities sold under agreements to repurchase incurred in the ordinary course
of business, or (iii) otherwise incurred in the ordinary course of
their banking business;
(c) Indebtedness
constituting obligations of the Borrower and any Financial Institution
Subsidiary under debentures, indentures, trust agreements and guarantees in
connection with the issuance by such Persons of trust preferred
securities;
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(d) (i)
Indebtedness owed by the Borrower or any “affiliate” of the Borrower (as defined
in Regulation W of the FRB and sections 23A and 23B of the Federal Reserve Act)
to any Financial Institution Subsidiary not in violation of Regulation W of the
FRB (as amended, supplemented or otherwise modified), or (ii) Indebtedness owed
by any Subsidiary to the Borrower or (iii) Indebtedness owed by the Borrower or
any Subsidiary to a Subsidiary other than a Financial Institution
Subsidiary;
(e) Any
other Indebtedness that is subordinated to the Indebtedness under this Agreement
which contains terms, covenants and conditions in form and substance reasonably
satisfactory to the Lender as evidenced by its prior written approval
thereof;
(f) Indebtedness
incurred under (i) Hedging Agreements entered into in the ordinary course of
business to hedge or mitigate risks to which the Borrower or any Subsidiary is
exposed in the conduct of its business or the management of its liabilities and
(ii) Hedging Agreements entered into by any Financial Institution Subsidiary as
a counterparty in the ordinary course of its business; and
(g) Indebtedness
of any Person purchased in a permitted Acquisition as long as the Borrower is in
compliance both before and after such Acquisition with the covenants contained
in Article VI and no Default or Event of Default exists or would result from
such Acquisition, provided that the amount of such Indebtedness together with
the amount of such Indebtedness permitted in Section 7.1(c)(iii) shall not
exceed $5,000,000 in the aggregate.
Section 7.2. Negative
Pledge . The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of its
assets or property now owned or hereafter acquired, except:
(a) Liens
(if any) created in favor of the Lender pursuant to the Loan
Documents;
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(b)
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Permitted
Encumbrances;
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(c) Liens
granted to secure any Indebtedness incurred pursuant to Section 7.1(c) ( as long
as in the case of Section 7.1(c)(ii), such Lien shall only extend to those
securities sold) and Section 7.1(e); and
(d) extensions,
renewals, or replacements of any Lien referred to in paragraphs (a), (b) and (c)
of this Section.
Provided, that at no time and under
no circumstances will the Borrower permit any Lien on the capital stock of any
Financial Institution Subsidiary.
Section 7.3. Fundamental
Changes.
(a) The
Borrower will not, and will not permit any Subsidiary to, merge into or
consolidate into any other Person, or permit any other Person to merge into or
consolidate with it, or sell, lease, transfer or otherwise dispose of (in a
single transaction or a series of transactions) all or substantially all of its
assets (other than in the ordinary course of business) or all or substantially
all of the stock of any of its Subsidiaries or liquidate or
dissolve; provided, that if at the time thereof
and immediately after giving effect thereto, no Default or Event of Default
shall have occurred and be continuing, (i) the Borrower or any Subsidiary may
merge with a Person which is not affiliated with the Borrower if the Borrower
(or such Subsidiary if the Borrower is not a party to such merger) is the
surviving Person, (ii) any Subsidiary may merge into another Subsidiary provided
that in the case of a Financial Institution Subsidiary, a Financial Institution
Subsidiary is the surviving Person, (iii) any Subsidiary may sell, lease,
transfer or dispose of its assets to (A)
21
the
Borrower, (B) in the case of any Subsidiary that is not a Financial
Institution Subsidiary, to any other Subsidiary and (C) in the case of a
Financial Institution Subsidiary, to another Financial Institution
Subsidiary or to a Subsidiary which is not a Financial Institution Subsidiary
provided that such Subsidiary is a direct or indirect Subsidiary of the selling
Financial Institution Subsidiary, (iv) any Subsidiary (other than a Financial
Institution Subsidiary) or the assets of any Subsidiary may be sold or otherwise
transferred so long as the aggregate value of such assets or of such Subsidiary
shall not exceed $500,000 in any fiscal year, provided, that any
Financial Institution Subsidiary may sell loans, investments or other assets in
the ordinary course of its business and (v) notwithstanding anything to the
contrary in any of the foregoing, the Borrower or any Subsidiary may enter into
a sale leaseback transaction of any of its real property, now owned or hereafter
acquired.
(b) The
Borrower will not, and will not permit any of its Subsidiaries to, engage to any
material extent in any business other than businesses of the type conducted by
the Borrower and its Subsidiaries on the date hereof and businesses reasonably
related thereto and any types of businesses that are expressly permitted by any
Governmental Authority having jurisdiction over the Borrower and/or any
Financial Institutions Subsidiary.
Section 7.4. Restricted
Payments. Upon the occurrence and
during the continuation of any Default or Event of Default, the Borrower will not, and will not permit its
Subsidiaries to, declare or make, or
agree to pay or make, directly or indirectly, any dividend on any class of its
stock, or make any payment on account of, or set apart assets for a sinking or
other analogous fund for, the purchase, redemption, retirement, defeasance or
other acquisition of, any shares of common stock or Indebtedness subordinated to
the Obligations of the Borrower or any options, warrants, or other rights to
purchase such common stock or such Indebtedness, whether now or hereafter
outstanding; provided, that any
Subsidiary may pay dividends to the Borrower or to its parent company at any
time.
Section 7.5. Restrictive
Agreements. The Borrower will not, and will not permit any
Subsidiary to, directly or indirectly, enter into, incur or permit to exist any
agreement that prohibits, restricts or imposes any condition upon (a) the
ability of the Borrower or any Subsidiary to create, incur or permit any Lien
upon any of its assets or properties, whether now owned or hereafter acquired,
or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to its common stock, to make or repay loans or
advances to the Borrower or any other Subsidiary, to guarantee Indebtedness of
the Borrower or any other Subsidiary or to transfer any of its property or
assets to the Borrower or any Subsidiary of the Borrower; provided, that (i)
the foregoing shall not apply to restrictions or conditions imposed by law or
by this Agreement or any other Loan Document, (ii) the foregoing shall
not apply to customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary pending such sale, provided such
restrictions and conditions apply only to the Subsidiary that is sold and such
sale is permitted hereunder, and (iii) clause (a) shall not apply to customary
provisions in leases restricting the assignment thereof.
Section 7.6. Investments,
Etc The Borrower will not, and will not permit any of its
Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly-owned Subsidiary prior to such merger),
any common stock, Indebtedness or other securities (including any option,
warrant, or other right to acquire any of the foregoing) of, make or permit to
exist any loans or advances to, Guarantee any obligations of, or make or permit
to exist any investment or any other interest in, any other Person (all of the
foregoing being collectively called "Investments"),
or purchase or otherwise acquire (in one transaction or a series of
transactions) any assets of any other Person that constitute a business unit,
except:
(a) Investments
existing on the date hereof (including Investments in Subsidiaries) that have
been disclosed to the Lender and/or that are set forth on the most current
financial statements that have been delivered to the Lender;
22
(b) Investments
purchased in the ordinary course of business by any Financial Institution
Subsidiary;
(c) Investments
made by the Borrower in or to any Subsidiary and by any Subsidiary in or to the
Borrower or in or to another Subsidiary, including without limitation any such
Investment made in a Subsidiary established in connection with the issuance of
trust preferred securities;
(d) Investments
made for the purpose of making or consummating an Acquisition; provided, that
(i) after giving effect to such Acquisition, no Default or Event of Default
shall have occurred and be continuing, (ii) such Acquisitions are undertaken in
accordance with all applicable laws, and (iii) the prior written consent or
approval of such Acquisition of the board of directors or equivalent governing
body of the Person being acquired. Upon the Borrower or any Subsidiary’s
Investment of fifty percent or more of the voting stock any Person that is a
regulated financial institution, such Person shall become a Financial
Institution Subsidiary for purposes of this Agreement; and
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(e)
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Other
Investments permitted by applicable laws and regulations.
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ARTICLE VIII
EVENTS OF
DEFAULT
Section 8.1. Events of
Default. If
any of the following events (each an "Event of Default")
shall occur:
(a) the
Borrower shall fail to pay any principal of any Revolving Loan when and as the
same shall become due and payable, whether at the due date thereof or at a date
fixed for prepayment or otherwise; or
(b) the
Borrower shall fail to pay any interest on any Revolving Loan or any other
amount (other than an amount payable under clause (a) of this Article)
payable under this Agreement or any other Loan Document, when and as the
same shall become due and payable, and such failure shall continue unremedied
for a period of three (3) days; or
(c) any
representation or warranty made or deemed made by or on behalf of the Borrower
or any Subsidiary in or in connection with this Agreement or any other Loan
Document (including the Schedules attached thereto) and any amendments or
modifications hereof or waivers hereunder, or in any certificate, report,
financial statement or other document submitted to the Lender by the
Borrower or any representative of the Borrower pursuant to
or in connection with this Agreement shall prove to be incorrect in any material
respect when made
or deemed made or submitted; or
(d) the
Borrower shall fail to observe or perform any covenant or agreement contained in
Section 5.2 (a)
or (e),
Section 5.3
(with respect to the Borrower’s existence), or Articles VI or VII;
or
(e) the
Borrower shall fail to observe or perform any covenant or agreement contained
(i) in this Agreement (other than those referred to in clauses (a), (b) and (d)
above), and such failure shall remain unremedied for 30 days after the
earlier of (x) any Responsible Officer of the Borrower becomes aware of
such failure, or (y) notice thereof shall have been given to the Borrower
by the Lender or any Lender or (ii) in any other Loan Document (after taking
into consideration any applicable grace periods); or
23
(f) the
Borrower or any Subsidiary (whether as primary obligor or as guarantor or other
surety) shall fail to pay any principal of or premium or interest on any
Indebtedness owed to the Bank (including without limitation any Hedging
Agreement or any letter of credit) in any amount or any other Indebtedness owed
to any other Person greater than $500,000 that is outstanding, when
and as the same shall become due and payable (whether at scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument evidencing such Indebtedness; or any other event shall occur or
condition shall exist under any agreement or instrument relating to such
Indebtedness and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or permit the acceleration of, the maturity of such
Indebtedness (without regard to whether such holders or other Person shall have
exercised or waived their right to do so); or any such Indebtedness shall be
declared to be due and payable; or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or any offer to prepay, redeem, purchase or
defease such Indebtedness shall be required to be made, in each case prior to
the stated maturity thereof; or
(g) the
Borrower or any Subsidiary shall (i) commence a voluntary case or other
proceeding or file any petition seeking liquidation, reorganization or other
relief under any federal, state or foreign bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of
a custodian, trustee, receiver, liquidator or other similar official of it or
any substantial part of its property, (ii) consent to the institution of , or
fail to contest in a timely and appropriate manner, any proceeding or petition
described in clause (i) of this Section, (iii) apply for or consent to the
appointment of a custodian, trustee, receiver, liquidator or other similar
official for the Borrower or any such Subsidiary or for a substantial part of
its assets, (iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding, (v) make a general assignment for the
benefit of creditors, or (vi) take any action for the purpose of
effecting any of the foregoing; or
(h) an
involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect of the
Borrower or any Subsidiary or its debts, or any substantial part of
its assets, under any federal, state or foreign bankruptcy,
insolvency or other similar law now or hereafter in effect or (ii)
the appointment of a custodian, trustee, receiver, liquidator or other similar
official for the Borrower or any Subsidiary or for a substantial part of its
assets, and in any such case, such proceeding or petition shall
remain undismissed for a period of 60 days or an order or decree approving or
ordering any of the foregoing shall be entered; or
(i) the
Borrower or any Subsidiary shall become unable to pay, shall admit in writing
its inability to pay, or shall fail to pay, its debts as they become due;
or
(j) an
ERISA Event shall have occurred that, in the opinion of the Lender, when taken
together with other ERISA Events that have occurred, could reasonably be
expected to result in liability to the Borrower and the Subsidiaries in an
aggregate amount exceeding $500,000; or
(k) any judgment or order for
the payment of money in excess of $500,000 in the aggregate shall be rendered
against the Borrower or any Subsidiary, and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order or (ii)
there shall be a period of 30 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(l) any non-monetary judgment or order shall
be rendered against the Borrower or any Subsidiary that could reasonably be
expected to have a Material Adverse Effect, and there shall be a period of
30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect;
or
24
(m) a Change in
Control shall occur or exist; or
(n) any
Governmental Authority having regulatory authority over the Borrower or any
Subsidiary shall impose any restriction upon the payment of dividends from any
such Subsidiary to the Borrower; or
(o) any
Financial Institution Subsidiary shall cease for any reason to be an insured
bank under the Federal Deposit Insurance Act, as amended; or
(p) the
FDIC or any other federal or state regulatory authority shall issue a cease and
desist order or take other action of a disciplinary or remedial nature against
the Borrower or any Financial Institution Subsidiary and such order
or other action could reasonably be expected to have a Material Adverse Effect
or there shall occur with respect to any Financial Institution Subsidiary any
event that is grounds for the required submission of a capital restoration plan
under 12 U. S. C. §1831o (e)(2) and the regulations thereunder; or
(q) the
Borrower or any Financial Institution Subsidiary shall enter into a punitive
written agreement with any Governmental Authority having regulatory authority
over such Person for any reason;
then, and
in every such event (other than an event with respect to the Borrower or any
Subsidiary described in clause (g) or (h) of this Section) and at any time
thereafter during the continuance of such event, the Lender may, by notice to
the Borrower, take any or all of the following actions, at the same or
different times:
(i) terminate its Revolving Commitment; (ii) declare the
principal of and any accrued interest on the Revolving Loans, and all other
Obligations owing hereunder, to be, whereupon the same shall become due and
payable immediately, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower and (iii) exercise all
remedies contained in any other Loan Document; and that, if an Event
of Default specified in either clause (g) or (h) shall occur, the
Revolving Commitment shall automatically terminate and the principal
of the Revolving Loans then outstanding, together with accrued interest thereon,
and all fees, and all other Obligations shall automatically become
due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower.
ARTICLE IX
MISCELLANEOUS
Section 9.1. Notices.
(a) Except
in the case of notices and other communications expressly permitted to be given
by telephone, all notices and other communications to any party herein to be
effective shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopy, as
follows:
|
To
the Borrower:
|
||
|
150
Xxxxx Xxxxxxxxxxxx Xxxxxx
|
||
|
Xxxxxxxx,
Xxxxx Xxxxxxxx 00000
|
||
|
Attn:
Xxxx X. Xxxxxxxx, Treasurer
|
||
|
Telephone
Number: (000) 000-0000
|
||
|
Fax
Number: (000) 000-0000
|
25
|
Email:
xxxx.xxxxxxxx@xxxxxxxxx.xxx
|
||
|
Website:
xxx.xxxxxxxxx.xxx
|
||
|
To
the Lender:
|
SunTrust
Bank
|
|
|
300
Xxxxxxxxx Xxxxxx, 0xx
Xxxxx
|
||
|
Xxxxxxx,
Xxxxxxx 00000
|
||
|
Attn:
Xxxxx Xxxxxxx
|
||
|
Telephone
Number: (000) 000-0000
|
||
|
Fax
Number: (000) 000-0000
|
||
|
Email:
Xxxxx.Xxxxxxx@xxxxxxxx.xxx
|
Notices
sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received; notices sent by
telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient).
Any party
hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All
such notices and other communications shall, when transmitted by overnight
delivery, or faxed, be effective when delivered for overnight (next-day)
delivery, or transmitted in legible form by facsimile machine, respectively, or
if mailed, upon the third Business Day after the date deposited into the mails
or if delivered, upon delivery; provided, that
notices delivered to the Lender shall not be effective until actually received
by the Lender at its address specified in this Section 9.1. With
respect to any communications delivered or furnished by electronic communication
under Section
5.1, such communications sent to an e-mail address shall be deemed
received upon the sender’s receipt of an acknowledgement from the intended
recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement); provided, that if
such communications are not sent during the normal business hours of the
recipient, such communications shall be deemed to have been sent at the opening
of business on the next Business Day for the recipient, and (ii)
communications posted to an internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (i) of notification that such
communication is available and identifying the website address
therefor.
(b) Any
agreement of the Lender herein to receive certain notices by telephone or
facsimile is solely for the convenience and at the request of the
Borrower. The Lender shall be entitled to rely on the authority of
any Person purporting to be a Person authorized by the Borrower to give such
notice and the Lender shall not have any liability to the Borrower or other
Person on account of any action taken or not taken by the Lender in reliance
upon such telephonic or facsimile notice. The obligation of the
Borrower to repay the Revolving Loans and all other Obligations hereunder shall
not be affected in any way or to any extent by any failure of the Lender to
receive written confirmation of any telephonic or facsimile notice or the
receipt by the Lender of a confirmation which is at variance with the terms
understood by the Lender to be contained in any such telephonic or facsimile
notice.
Section 9.2. Waiver;
Amendments.
(a) No
failure or delay by the Lender in exercising any right or power hereunder or any
other Loan Document, and no course of dealing between the Borrower and the
Lender, shall
operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power or any abandonment or discontinuance of steps
to enforce such right or power, preclude any other or further exercise thereof
or the exercise of any other right or power hereunder or
thereunder. The rights and remedies of the Lender
hereunder
26
and under
the other Loan Documents are cumulative and are not exclusive of any rights
or remedies provided by law. No waiver of any provision of this Agreement or any
other Loan Document or consent to any departure by the Borrower therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Revolving Loan shall not be
construed as a waiver of any Default or Event of Default, regardless of whether
the Lender may have had notice or knowledge of such Default or Event of Default
at the time.
(b) No
amendment or waiver of any provision of this Agreement or the other Loan
Documents, nor consent to any departure by the Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Borrower and the Lender and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which
given.
Section 9.3. Expenses;
Indemnification.
(a) The
Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses of the
Lender (including, without limitation, the reasonable fees, charges and
disbursements of outside counsel and the allocated cost of inside counsel) in
connection with the preparation and administration of the Loan Documents and any
amendments, modifications or waivers thereof (whether or not the transactions
contemplated in this Agreement or any other Loan Document shall be consummated),
and (ii) all out-of-pocket costs and expenses (including, without limitation,
the reasonable fees, charges and disbursements of outside counsel and the
allocated cost of inside counsel) incurred by the Lender in connection with the
enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Revolving
Loans made hereunder, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of such Revolving
Loans.
(b)The Borrower shall indemnify the
Lender and each Affiliate of the Lender, and each officer, director, employee,
agents and advisors of the Lender and each Affiliate of the Lender (each, an
"Indemnitee")
against, and hold each of them harmless from, any and all costs, losses,
liabilities, claims, damages and related expenses, including the reasonable
fees, charges and disbursements of any counsel for any Indemnitee, which may be
incurred by any Indemnitee, or asserted against any Indemnitee by the
Borrower or any third Person, arising out of, in connection with or as a result
of (i) the execution or delivery of any this Agreement or any other agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the consummation of any of the
transactions contemplated hereby, (ii) any Revolving Loan or any actual or
proposed use of the proceeds therefrom, (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned by the
Borrower or any Subsidiary or any Environmental
Liability related in any way to the Borrower or any Subsidiary or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether brought by the Borrower or any third Person and whether
based on contract, tort, or any other theory and regardless of
whether any Indemnitee is a party thereto; provided, that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction in a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such
Indemnitee.
(c)The Borrower shall pay, and hold the
Lender harmless from and against, any and all present and future stamp,
documentary, and other similar taxes with respect to this Agreement and any
other Loan Documents, any collateral described therein, or any payments due
thereunder, and save the Lender harmless from and against any and all
liabilities with respect to or resulting from any delay or omission to pay such
taxes.
27
(d) To
the extent permitted by applicable law, the Borrower shall not assert, and
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to actual or
direct damages) arising out of, in connection with or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the transactions
contemplated therein, any Loan or the Letter of Credit or the use of
proceeds thereof.
(e) All
amounts due under this Section shall be payable promptly after written demand
therefor.
Section 9.4. Successors
and Assigns.
(a) The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights hereunder without the
prior written consent of the Lender (and any attempted assignment or transfer by
the Borrower without such consent shall be null and void).
(b) The
Lender may at any time sell participations or assignments in all or a portion of
its rights and obligations under this Agreement and the other Loan Documents
(including all or a portion of its Revolving Commitment and the Revolving Loans
at the time owing to it).
(c) The
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement and the Revolving Credit Note to
secure its obligations to a Federal Reserve Bank without complying with this
Section; provided, that no
such pledge or assignment shall release the Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
Section 9.5. Governing
Law; Jurisdiction; Consent to Service of Process.
(a) This
Agreement and the other Loan Documents shall be construed in accordance with and
be governed by the law (without giving effect to the conflict of law principles
thereof) of the State of North Carolina.
(b) The
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the non-exclusive jurisdiction of any Federal and/or state court
(including without limitation the North Carolina Business Court, if
applicable) located in the State of North Carolina and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or any other Loan Document or the transactions contemplated
hereby or thereby, or for recognition or enforcement of any judgment, and each
of the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such North Carolina state court (including the North Carolina Business Court)
or, to the extent permitted by applicable law, such Federal court. Each of the
parties hereto agrees that a final nonappealable judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement or any other Loan Document shall affect any right that the Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Loan Document against the Borrower or its properties in the courts of
any jurisdiction.
(c) The
Borrower irrevocably and unconditionally waives any objection which it
may now or hereafter have to the laying of venue of any such suit, action
or proceeding described in paragraph (b) of this Section and brought in any
court referred to in paragraph (b) of this Section. Each of the parties hereto
irrevocably waives, to the fullest extent permitted by applicable law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
28
(d) Each
party to this Agreement irrevocably consents to the service of process in the
manner provided for notices in Section
9.1. Nothing in this Agreement or in any other Loan Document
will affect the right of any party hereto to serve process in any other manner
permitted by law.
Section 9.6. WAIVER OF
JURY TRIAL. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).
Section
9.7. Right of
Setoff. In addition to any rights now or hereafter granted
under applicable law and not by way of limitation of any such rights, the Lender
shall have the right, at any time or from time to time upon the occurrence and
during the continuance of an Event of Default, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, to set off and apply against all deposits (general
or special, time or demand, provisional or final) of the Borrower at any time
held or other obligations at any time owing by the Lender to or for the credit
or the account of the Borrower against any and all Obligations held by the
Lender, irrespective of whether the Lender shall have made demand hereunder and
although such Obligations may be unmatured. The Lender agrees
promptly to notify the Borrower after any such set-off and any application made
by the Lender; provided, that the
failure to give such notice shall not affect the validity of such set-off and
application.
Section
9.8. Counterparts;
Integration. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. This Agreement, the other Loan
Documents, and any separate letter agreement(s) relating to any fees payable to
the Lender constitute the entire agreement among the parties hereto and thereto
regarding the subject matters hereof and thereof and supersede all prior
agreements and understandings, oral or written, regarding such subject
matters.
Section 9.9. Survival.
All covenants, agreements, representations and warranties made by the Borrower
herein and in the certificates or other instruments delivered in connection with
or pursuant to this Agreement shall be considered to have been relied upon by
the other parties hereto and shall survive the execution and delivery of this
Agreement and the making of any Revolving Loans, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Revolving Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid and so long as the Revolving
Commitment has not expired or terminated. The provisions of Sections 2.10 and
9.3 shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Revolving Loans, the
expiration or termination of the Revolving Commitment or the termination of this
Agreement or any provision hereof. All representations and warranties
made herein, in the certificates, reports, notices, and other
documents delivered pursuant to this Agreement shall survive the execution
and delivery of this Agreement and the other Loan Documents, and the making of
the Revolving Loans.
Section 9.10. Severability. Any
provision of this Agreement or any other Loan Document held to be illegal,
invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be
ineffective to the extent of such illegality, invalidity or unenforceability
without affecting the legality, validity or enforceability of the remaining
provisions hereof or thereof; and the illegality, invalidity or unenforceability
of a particular
29
provision
in a particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
Section 9.11. Interest
Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Revolving Loan,
together with all fees, charges and other amounts which may be treated as
interest on such Loan under applicable law (collectively, the "Charges"),
shall exceed the maximum lawful rate of interest (the "Maximum
Rate") which may be contracted for, charged, taken, received or reserved
by the Lender in accordance with applicable law, the rate of interest payable in
respect of such Revolving Loan hereunder, together with all Charges payable in
respect thereof, shall be limited to the Maximum Rate and, to the extent lawful,
the interest and Charges that would have been payable in respect of
such Revolving Loan but were not payable as a result of the operation of this
Section shall be cumulated and the interest and Charges payable to the Lender in
respect of other Revolving Loans or periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Rate to the date of repayment, shall have been
received by the Lender.
Section 9.12. Patriot
Act. The Lender
hereby notifies the Borrower that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Patriot
Act”), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow the Lender to identify
the Borrower in accordance with the Patriot Act. The Borrower shall,
and shall cause each of its Subsidiaries to, provide to the extent commercially
reasonable, such information and take such other actions as are reasonably
requested by the Lender in order to assist the Lender in maintaining compliance
with the Patriot Act.
[Remainder
of Page Intentionally Left Blank]
30
IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed under seal in the
case of the Borrower by their respective authorized officers as of the day and
year first above written.
|
By
|
/s/ Xxxxxxx X. Xxxxxx
|
|
|
Name: Xxxxxxx
X. Xxxxxx
|
||
|
Title: President
|
||
|
[SEAL]
|
||
|
SUNTRUST
BANK
|
||
|
By
|
/s/ Xxxxx X. Xxxxxxx
|
|
|
Name: Xxxxx
X. Xxxxxxx
|
||
|
Title: Director
|
||
31
SCHEDULE
4.5
LITIGATION
MATTERS
None
Schedule
4.5
SCHEDULE 4.12
Financial Institution
Subsidiaries
CommunityONE
Bank, National Association, a national banking association
Other
Subsidiaries
|
Name
|
Jurisdiction of
Incorporation
|
Ownership
|
|
Dover
Mortgage Company
|
100%
by Bank
|
|
|
First
National Investor Services, Inc.
|
100%
by Bank
|
Schedule
4.12
EXHIBIT
A
REVOLVING CREDIT
NOTE
|
$10,000,000.00
|
Atlanta,
Georgia
|
May 27,
2008
FOR VALUE RECEIVED, the undersigned,
FNB UNITED CORP., a North Carolina corporation (the “Borrower”), hereby promises to pay to
SunTrust Bank (the “Lender”) or its registered assigns
at its principal office or any other office that the Lender designates, on the
Commitment Termination Date (as defined in the Revolving Credit Agreement dated
as of May 27, 2008, as the same may be amended, supplemented or otherwise
modified from time to time, the “Credit
Agreement”),
between the Borrower and the Lender, the lesser of the
principal sum of Ten Million and no/100 Dollars ($10,000,000) and the aggregate
unpaid principal amount of all Revolving Loans made by the Lender to the
Borrower pursuant to the Credit Agreement, in lawful money of the United States
of America in immediately available funds, and to pay interest from the date
hereof on the principal amount thereof from time to time outstanding, in like
funds, at said office, at the rate or rates per annum and payable on such dates
as provided in the Credit Agreement. In addition, should legal action
or an attorney-at-law be utilized to collect any amount due hereunder, the
Borrower further promises to pay all costs of collection, including the
reasonable attorneys’ fees (determined at customary rates of the firm or firms
representing the Lender for hours actually worked, and not as a statutory
percentage of amounts outstanding under this Revolving Credit Note) of the
Lender.
The Borrower promises to pay interest,
on demand, on any overdue principal and, to the extent permitted by law, overdue
interest from their due dates at a rate or rates provided in the Credit
Agreement.
All borrowings evidenced by this
Revolving Credit Note and all payments and prepayments of the principal hereof
and the date thereof shall be endorsed by the holder hereof on the schedule
attached hereto and made a part hereof or on a continuation thereof which shall
be attached hereto and made a part hereof, or otherwise recorded by such holder
in its internal records; provided, that the
failure of the holder hereof to make such a notation or any error in such
notation shall not affect the obligations of the Borrower to make the payments
of principal and interest in accordance with the terms of this Revolving Credit
Note and the Credit Agreement.
This Revolving Credit Note is issued in
connection with, and is entitled to the benefits of, the Credit Agreement which,
among other things, contains provisions for the acceleration of the maturity
hereof upon the happening of certain events, for prepayment of the principal
hereof prior to the maturity hereof and for the amendment or waiver of certain
provisions of the Credit Agreement, all upon the terms and conditions therein
specified. THIS REVOLVING CREDIT NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NORTH CAROLINA AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
|
[SEAL]
|
||
Exhibit
A-1
LOANS
AND PAYMENTS
|
Date
|
Amount
and
Type of
Loan
|
Payments
of
Principal
|
Unpaid
Principal Balance
of
Note
|
Name
of Person
Making
Notation
|
Exhibit
A-2
EXHIBIT
2.2
SunTrust
Bank
300
Xxxxxxxxx Xxxxxx, 0xx
Xxxxx
Xxxxxxx,
Xxxxxxx 00000
Attention:
Dear
Sirs:
Reference is made to the Revolving
Credit Agreement dated as of May 27, 2008 (as amended and in effect
on the date hereof, the “Credit Agreement”), between the undersigned, as
Borrower, and SunTrust Bank, as Lender. Terms defined in the Credit
Agreement are used herein with the same meanings. This notice
constitutes a Notice of Borrowing, and the Borrower hereby requests a Revolving
Loan under the Credit Agreement, and in that connection the Borrower specifies
the following information with respect to the Revolving Loan requested
hereby:
(A) Principal
amount of Revolving Loan:________________________
(B) Date
of Revolving Loan (which is a Business Day): _________________
(C) Purpose
(if larger than $500,000):_______________________________
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|
(D)
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Location
and number of Borrower’s account to which proceeds of Revolving Loan are
to be disbursed:__________________________
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The Borrower hereby represents and
warrants that the conditions specified in paragraphs (a), (b) and (c) of Section
3.2 of the Credit Agreement are satisfied.
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Very
truly yours,
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||
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By:
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Name:
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||
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Title:
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||
Exhibit
2.2
