AMENDED AND RESTATED REVOLVING CREDIT/TERM LOAN AGREEMENT
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THIS AMENDED AND RESTATED REVOLVING CREDIT/TERM LOAN AGREEMENT is dated as of
July 31, 1999 between COMMUNITY BANKSHARES, INC., a Georgia corporation, whose
principal place of business is at 000 Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxx 00000
(the "Borrower") and SUNTRUST BANK, ATLANTA, a Georgia banking corporation whose
principal place of business is at 00 Xxxx Xxxxx, Xxxxxxx, Xxxxxxx 00000 (the
"Lender"). This Amended and Restated Revolving Credit/Term Loan Agreement renews
the Revolving Credit under and supersedes the Amended and Restated Revolving
Credit /Term Loan Agreement between the parties dated July 21, 1998. The parties
hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01. Defined Terms. As used in this Agreement, the following
terms have the following meanings (terms defined in the singular to have same
meaning when used in the plural and vice versa):
"Affiliate" means any Person (1) which directly or indirectly controls,
or is controlled by, or is under common control with the Borrower or a
Subsidiary; (2) which directly or indirectly beneficially owns or holds five
percent (5.0%) or more of any class of voting stock of the Borrower or any
Subsidiary; or (3) five percent (5.0%) or more of the voting stock of which is
directly or indirectly beneficially owned or held by the Borrower or a
Subsidiary. The term "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
Person whether through the ownership of voting securities, by contract, or
otherwise.
"Agreement" means this Amended and Restated Revolving Credit/Term Loan
Agreement, as amended, supplemented, or modified from time to time.
"Bank" means each Subsidiary of Borrower that is listed on EXHIBIT A,
attached hereto and incorporated herein, and any Subsidiary acquired by Borrower
from time to time after the date hereof, which is a banking association or
banking corporation organized under either the laws of the United States or of a
state in the United States.
"Business Day" means any day other than a Saturday, Sunday, or other
day on which commercial banks in Georgia are authorized or required to close
under the laws of the State of Georgia.
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"Call Reports" means, with respect to any Bank, such Bank's
Consolidated Reports of Condition and Income filed with such Bank's applicable
federal Regulatory Authority.
"Capital Lease" means all leases which have been or should be
capitalized on the books of the lessee in accordance with generally accepted
accounting principles.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the regulations and published interpretations thereof.
"Collateral" means all property which is subject to the Lien granted by
any Loan Document, including, without limitation, the personal property
identified and described on EXHIBIT B attached hereto and incorporated herein.
"Commonly Controlled Entity" means an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 414(b) or 414(c) of the Code.
"Debt" means without duplication (1) indebtedness or liability of
Borrower or any Subsidiaries for borrowed money; (2) obligations of Borrower or
any Subsidiaries evidenced by bonds, debentures, notes, or other similar
instruments; (3) obligations of Borrower or any Subsidiaries for the deferred
purchase price of property or services (including trade obligations); (4)
obligations of Borrower or any Subsidiaries as lessee under Capital Leases; (5)
liabilities of Borrower or any Subsidiaries in respect of unfunded vested
benefits under Plans covered by ERISA; (6) all guarantees, endorsements (other
than for collection or deposit in the ordinary course of business), interest
rate swaps, and other contingent obligations of Borrower or any Subsidiaries to
purchase, to provide funds for payment, to supply funds to invest in any Person
or entity, or otherwise to assure a creditor against loss (except loans or
letters of credit made or issued in the ordinary course of business); and (7)
obligations of Borrower or any Subsidiaries, other than obligations as a lender,
secured by any Liens, whether or not the obligations have been assumed. The term
"Debt" does not include any deposit liabilities of any Bank.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations and published interpretations
thereof.
"Event of Default" means any of the events specified in Section 8.01,
provided that any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.
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"GAAP" means generally accepted accounting principles in the United
States.
"Governmental Authority" means any nation or government, any state or
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government.
"Lien" means the charge, encumbrance, security interest, or right of
the Lender in property created by any Loan Document or any other mortgage, deed
of trust, pledge, security interest, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference, priority, or
other security agreement or preferential arrangement, charge, or encumbrance of
any kind or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any financing lease having
substantially the same economic effect as of the foregoing, or the filing of any
financing statement under the Uniform Commercial Code or comparable law of any
jurisdiction to evidence any of the foregoing).
"Loan" means collectively, the Revolving Credit and the Term Loan, as
such terms are defined, respectively, in Sections 2.01 and 2.03 of this
Agreement.
"Loan Documents" means this Agreement, the Note, the Revolving
Credit/Term Note, the Security Agreement, or any deed to secure debt, mortgage,
deed of trust, pledge agreement, security agreement, or other agreement
evidencing or securing the Loan (two or more of the foregoing being also
referred to collectively herein as the "Loan Documents").
"Multiemployer Plan" means a Plan described in Section 4001(a)(3) of
ERISA.
"1996 Agreement" means the Revolving Credit/Term Loan Agreement by and
between Borrower and Lender dated January 10, 1996, as amended, supplemented, or
modified from time to time.
"Note" has the meaning assigned to such term in Section 2.01.01
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
governmental authority, or other entity of whatever nature.
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"Plan" means any pension plan which is covered by Title IV of ERISA and
in respect of which the Borrower or a Commonly Controlled Entity is an
"employer" as defined in Section 3(5) of ERISA.
"Prime Rate" means the rate of interest announced by the Lender from
time to time as its prime commercial lending rate, which rate is not necessarily
the lowest rate of interest charged by the Lender to its borrowers.
"Principal Office" means the Lender's office at 00 Xxxx Xxxxx, Xxxxxxx,
Xxxxxxx 00000.
"Prohibited Transaction" means any transaction set forth in Section 406
of ERISA or Section 4975 of the Code.
"Real Estate Owned" has the meaning assigned to such term in Section
4.15.
"Regulatory Authority" or "Regulatory Authorities" means the Federal
Reserve Board and, as applicable, the Department of Banking of a state of the
United States, the Federal Deposit Insurance Corporation, the Office of the
Comptroller of the Currency and any other agency with regulatory control over
Borrower, any Bank or any other Subsidiary.
"Reportable Event" means any of the events set forth in Section 4043 of
ERISA.
"Revolving Credit" has the meaning assigned to such term in Section
2.01.
"Revolving Credit/Term Note" shall have the meaning assigned to such
term in Section 2.05.
"Revolving Maturity Date" means July 31,2000.
"Security Agreement" means the Amended and Restated Stock Pledge and
Security Agreement executed by Borrower in favor of Lender dated July 21, 1997.
"Subsidiary" means, as to the Borrower, a corporation of which shares
of stock having ordinary voting power (other than stock having such power only
by reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation are, at the time, owned, or the
management of which corporation is otherwise controlled, directly or indirectly,
through one or more intermediaries, or both, by the Borrower. The term
"Subsidiary" shall specifically include the Banks.
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"Term Loan" means that portion of the credit established pursuant to
the 1996 Agreement which remains outstanding pursuant thereto and under the
Revolving/Credit Term Note.
"Tier I Capital" means those components of the equity capital of the
Borrower or of any Bank which, in the aggregate, constitute the core or primary
capital of the Borrower or Bank, as those components are determined and defined
from time to time by the Federal Regulatory Authority having primary
jurisdiction over the Borrower or any Bank.
"Tier II Capital" means those components of the equity capital of the
Borrower or of any Bank which, in the aggregate, constitute the supplementary
capital of the Borrower or Bank, as those components are determined and defined
from time to time by the Federal Regulatory Authority having primary
jurisdiction over the Borrower or any Bank.
"Total Capital" means the total of the amounts of Tier I Capital and
Tier II Capital that qualify, under the applicable regulations of the Federal
Regulatory Authority having primary jurisdiction over the Borrower or any Bank,
for inclusion in the computation of leverage capital requirements and
risk-weighted capital requirements.
"Total Non-Performing Assets" means the sum of (i) all loans that are
at least 90 days past due and (ii) all non-accrual loans.
Section 1.02. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Section 4.04, and all financial data
submitted pursuant to this Agreement shall be prepared in accordance with such
principles.
ARTICLE II
AMOUNT AND TERMS OF THE LOAN
Section 2.01. Revolving Credit. Subject to and upon the terms and
conditions set forth in this Agreement, the Lender hereby establishes until the
Revolving Maturity Date a revolving credit facility in favor of the Borrower not
to exceed THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) in aggregate
principal at any one time outstanding (the "Revolving Credit"). Within the
limits of the Revolving Credit, the Borrower may borrow, repay and reborrow
under the terms of this Agreement; provided, however, the Borrower may neither
borrow nor reborrow should there exist an Event of Default.
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Section 2.01.01. Note. The Borrower's obligation to pay interest and
repay principal under the Revolving Credit shall be evidenced by its Promissory
Note (the "Note") a copy of which is attached hereto and incorporated herein as
EXHIBIT D.
Section 2.02. Interest on the Revolving Credit. Interest shall accrue
on all advances under the Revolving Credit, shall be calculated on the basis of
actual days elapsed and a year of 360 days, and shall be computed at an annual
rate of interest equal to one percent the Prime Rate, minus one percent (1.0%).
The interest rate shall change as of the opening of business on each day the
Lender changes the Prime Rate. Accrued interest on the Revolving Credit shall be
paid on the last day of each calendar quarter, commencing September 30, 1999 and
on the Revolving Maturity Date.
Section 2.03. Term Loan. The Term Loan shall remain outstanding and
subject to the terms of the Revolving Credit/Term Note and the terms of this
Agreement.
Section 2.04. Interest on the Term Loan. The Borrower shall pay
interest to the Lender on the outstanding and unpaid principal amount of the
Term Loan made at a rate per annum equal to the Prime Rate, minus one percent
(1%).
Any change in the interest rate resulting from a change in the Prime
Rate shall become effective as of the opening of business on the day on which
such change in the Prime Rate shall become effective. Interest shall be
calculated on the basis of a year of three hundred sixty (360) days for the
actual number of days elapsed. Interest shall be paid in immediately available
funds on the last day of each calendar quarter and at maturity at the Principal
Office. Any principal amount not paid when due (at maturity, by acceleration, or
otherwise) shall bear interest thereafter until paid in full, payable on demand,
at a rate which shall be two percent (2.0%) above the rate which would otherwise
be applicable.
Section 2.05. Revolving Credit/Term Note. The Borrower's obligation to
repay the Term Loan shall continue to be evidenced by its promissory note (the
"Revolving Credit/Term Note")a copy of which is attached hereto and incorporated
herein as EXHIBIT D-1.
Section 2.06. Method of Payment. The Borrower shall make each payment
under this Agreement, the Note, and Revolving Credit/Term Note on the date when
due in lawful money of the United States to the Lender at its Principal Office
in immediately available funds. The Borrower hereby authorizes the Lender, if
and to the extent payment is not made when due under this Agreement, the Note,
or the Revolving Credit/Term Note to charge from time to time against any
account of the Borrower with the Lender any amount so due. Whenever any payment
to be made under this Agreement, the Note, or the Revolving Credit/Term Note
shall be stated to be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of payment of interest.
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Section 2.07. Use of Proceeds. Advances under the Revolving Credit
shall be used by the Borrower for general corporate purposes. The Borrower will
not, directly or indirectly, use any part of such advances for the purpose of
purchasing or carrying any margin stock within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System or to extend credit to any
Person for the purpose of purchasing or carrying any such margin stock, or for
any purpose which violates, or is inconsistent with, Regulation X of such Board
of Governors.
ARTICLE III
ADVANCES
Section 3.01. Advances. The Borrower shall give the Lender at least one
(1) Business Day's telephone notice of a requested disbursement under this
Agreement, specifying the date the disbursement is requested and the amount
thereof. The Lender may rely upon such telephone request for disbursements
received from the individual(s) identifying themselves as and purporting to be
Xx. Xxxxx Xxxxxxxx, Chief Financial Officer of the Borrower. The telephone
request for disbursement should be promptly confirmed in writing by Borrower by
mailing or transmitting by facsimile transmission a confirmation to the Lender
at the address designated hereinafter, as may be amended. Upon fulfillment of
the applicable conditions set forth below, and provided that the request for
disbursement does not cause the Borrower to exceed the aggregate principal
amount of the Revolving Credit, the Lender will make such disbursements
available to the Borrower in immediately available funds by crediting the amount
thereof to the Borrower's account, or other designated account, with the Lender.
Section 3.02. Conditions Precedent to Initial Advance. The obligation
of the Lender to make the initial advance under the Revolving Credit is subject
to the condition precedent that the Lender shall have received on or before the
day of such advance each of the following, in form and substance satisfactory to
the Lender and its counsel:
(1) Note. The Note duly executed by the Borrower;
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(2) Security Agreement. The Security Agreement shall remain in full
force and effect.
(3) Evidence of All Corporate Action by the Borrower. Certified (as of
the date of this Agreement) copies of all corporate action taken by the
Borrower, including resolutions of its Board of Directors, authorizing the
execution, delivery, and performance of the Loan Documents to which it is a
party and each other document to be delivered pursuant to this Agreement;
(4) Incumbency and Signature Certificate of the Borrower. A certificate
(dated as of the date of this Agreement) of the Secretary of Borrower certifying
the names and true signatures of officers of the Borrower authorized to sign the
Loan Documents to which it is a party and each other documents to be delivered
by the Borrower under this Agreement;
(5) Opinion of Counsel for the Borrower. [Intentionally Omitted]
(6) Officer's Certificate. A certificate signed by a duly authorized
officer of Borrower dated the date of this Agreement, in substantially the form
of EXHIBIT F;
(7) Additional Documentation. Such other approvals, opinions, or
documents as the Lender may reasonably request;
(8) Request for Advance. A request for advance pursuant to Section 3.01
hereof;
(9) Regulatory Approval. Copies of any and all necessary Governmental
Authority or Regulatory Authority approvals;
(10) No Material Adverse Change. A certificate signed by a duly
authorized officer of the Borrower stating that there has been no material
adverse change in the condition (financial or otherwise), business, or
operations of the Borrower or any Subsidiary since December 31, 1998.
Section 3.03. Conditions Precedent to Subsequent Advances The
obligation of the Lender to make subsequent advances under the Revolving Credit
is subject to the conditions precedent that the Lender shall have received, in
form and substance satisfactory to it, each of the following documents, and that
each of the conditions described below is fulfilled to the satisfaction of the
Lender: (i) if applicable, a request for advance pursuant to Section 3.01
hereof; and (ii) the representations and warranties contained in Article IV
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hereof and each of the other Loan Documents shall be correct in all material
respects on and as of the date of the request for the advance and the date of
the advance (if applicable), with the same effect as though made on and as of
those dates, except to the extent that such representations and warranties
relate solely to an earlier date, and on each of such dates, no event, act, or
condition shall have occurred or be continuing, or would result from the advance
requested which constitutes an Event of Default or would constitute an Event of
Default but for the requirement that notice be given or time elapse, or both.
The submission by the Borrower of an oral or written request for advance shall
constitute a representation and warranty as to the correctness of the above
facts, and if requested by the Lender with respect to the advance requested, the
Borrower shall furnish to the Lender a written certificate of an officer of the
Borrower, satisfactory in form and substance to the Lender, as to the
correctness of the above facts as a condition precedent to such advance.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lender to enter into the Agreement and to make
advances under the Revolving Credit, the Borrower represents and warrants to the
Lender that:
Section 4.01. Incorporation, Good Standing, and Due Qualification. The
Borrower and each of its non-bank Subsidiaries is a corporation duly
incorporated, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation. Each of the Banks set forth on EXHIBIT A is a
banking corporation and is duly organized, validly existing, and in good
standing under the laws of the state of incorporation listed on such EXHIBIT A.
The Borrower and each of its Subsidiaries has the corporate power and authority
to own its assets and to transact the business in which it is now engaged or
proposed to be engaged; and is duly qualified as a foreign corporation and in
good standing under the laws of each other jurisdiction in which such
qualification is required.
Section 4.02. Corporate Power and Authority. The execution, delivery,
and performance by the Borrower of the Loan Documents and the creation of the
security interest provided for under the Security Agreement are within the
Borrower's corporate powers and have been duly authorized by all necessary
corporate action and do not and will not (1) require any consent or approval of
the stockholders of the Borrower; (2) contravene the Borrower's charter or
bylaws; (3) violate any provision of any law, rule, regulation (including,
without limitation, Regulations U and X of the Board of Governors of the Federal
Reserve System), order, writ, judgment, injunction, decree, determination, or
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award presently in effect having applicability to the Borrower; (4) result in a
breach of or constitute a default under any indenture or loan or credit
agreement or any other agreement, lease, or instrument to which Borrower is a
party or by which it or its properties may be bound or affected; (5) result in,
or require, the creation or imposition of any Lien, except as contemplated by
the Security Agreement, upon or with respect to any of the properties now owned
or hereafter acquired by the Borrower; or (6) cause the Borrower to be in
default under any such law, rule, regulation, order, writ, judgment, injunction,
decree, determination, or award of any such indenture, agreement, lease, or
instrument.
Section 4.03. Legally Enforceable Agreement. This Agreement is, and
each of the other Loan Documents are legal, valid, and binding obligations of
the Borrower, and enforceable against the Borrower in accordance with their
respective terms, except to the extent that such enforcement may be limited by
(i) applicable bankruptcy, insolvency, liquidation, reorganization, moratorium
or other similar laws affecting creditors' rights generally, and (ii) general
principles of equity (whether applied in a proceeding at law or in equity).
Section 4.04. Financial Statements. The consolidated balance sheet of
the Borrower and its Subsidiaries as of December 31, 1998 and the related
consolidated statements of income, shareholder's equity, and cash flows of the
Borrower and its Subsidiaries for the fiscal year then ended, and the
accompanying footnotes, together with the opinion thereon, dated December 31,
1998 of Xxxxxxx & Xxxxxxx, independent certified public accountants, copies of
which have been furnished to the Lender, are complete and correct and fairly
present the financial condition of the Borrower and its Subsidiaries as at such
dates and the results of the operations of the Borrower and its Subsidiaries for
the periods covered by such statements, all in accordance with GAAP; and since
December 31, 1998, there has been no material adverse change in the condition
(financial or otherwise), business, or operations of the Borrower or any
Subsidiary. There are no liabilities of the Borrower or any Subsidiary, fixed or
contingent, which are material but are not reflected in the financial statements
or in the notes thereto, other than liabilities arising in the ordinary course
of business since December 31, 1998. No information, exhibit, or report
furnished by the Borrower to the Lender in connection with the approval of the
Loan or negotiation of this Agreement contains any material misstatement of fact
or omitted to state a material fact or any fact necessary to make the statement
contained therein not materially misleading.
Section 4.05. Labor Disputes and Acts of God. Neither the business nor
the properties of the Borrower or any Subsidiary are affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy, or other casualty
(whether or not covered by insurance) materially and adversely affecting such
business or properties or the operation of the Borrower or such Subsidiary.
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Section 4.06. Other Agreements. Neither the Borrower nor any Subsidiary
is a party to any indenture, loan, credit agreement, regulatory agreement or
imposition, or to any lease or other agreement or instrument, or subject to any
charter or corporate restriction which could have a material adverse effect on
the business, properties, assets, operations, or conditions, financial or
otherwise, of the Borrower or any Subsidiary or the ability of the Borrower to
carry out its obligations under the Loan Documents to which it is a party.
Neither the Borrower nor any Subsidiary is in material default in any respect in
the performance, observance, or fulfillment of any of the obligations,
covenants, or conditions contained in any agreement or instrument to which it is
a party.
Section 4.07. Litigation. Except as is set forth expressly on EXHIBIT G
attached hereto, no action or proceeding is pending or, threatened against, or
affecting, the Borrower or any of its Subsidiaries before any court, board,
commission, governmental agency, or arbitrator, which may, in any one case or in
the aggregate, materially adversely affect the financial condition, operations,
properties, or business of the Borrower or any Subsidiary or the ability of the
Borrower to perform its obligation under the Loan Documents to
which it is a party.
Section 4.08. No Defaults on Outstanding Judgments or Orders. The
Borrower and its Subsidiaries have satisfied all material judgments, and neither
the Borrower nor any Subsidiary is in default with respect to any judgment,
writ, injunction, decree, rule, or regulation of any court, arbitrator, federal,
state, municipal, or other governmental authority, commission, board, bureau,
agency, or instrumentality, domestic or foreign, which default shall materially
and adversely affect the business or properties of Borrower and its
Subsidiaries.
Section 4.09. Ownership and Liens. The Borrower and each Subsidiary
have title to, or valid leasehold interests in, all of their properties and
assets, real and personal, including the properties and assets and leasehold
interests reflected in the financial statements referred to in Section 4.04
(other than any properties or assets disposed of in the ordinary course of
business), and none of the properties and assets owned by the Borrower or any
Subsidiary and none of their leasehold interests is subject to any Lien, except
such as may be permitted pursuant to Section 6.01 of this Agreement.
Section 4.10. Subsidiaries and Ownership of Stock. The Borrower's
audited and consolidated financial statement for the fiscal year ending December
31, 1998, as provided to the Lender, includes a complete and accurate list of
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the Subsidiaries of the Borrower. All of the outstanding capital stock of each
Subsidiary has been validly issued, is fully paid and nonassessable, and is
owned by the Borrower free and clear of all Liens.
Section 4.11. ERISA. With respect to each Plan maintained by Borrower
and each Subsidiary, the Borrower and each Subsidiary are in compliance in all
material respects with all applicable provisions of ERISA. Neither a Reportable
Event nor a Prohibited Transaction has occurred and is continuing with respect
to any Plan; no notice of intent to terminate a Plan has been filed, nor has any
Plan been terminated; no circumstances exist which constitute grounds entitling
the PBGC to institute proceedings to terminate, or appoint a trustee to
administer, a Plan, nor has the PBGC instituted any such proceedings; neither
the Borrower nor any Commonly Controlled Entity has completely or partially
withdrawn from a Multiemployer Plan; the Borrower and each Commonly Controlled
Entity have met their minimum funding requirements under ERISA with respect to
all of their Plans, and the present value of all vested benefits under each Plan
exceeds the fair market value of all Plan assets allocable to such benefits, as
determined on the most recent valuation date of the Plan and in accordance with
the provisions of ERISA; and neither the Borrower nor any Commonly Controlled
Entity has incurred any liability to the PBGC under ERISA.
Section 4.12. Operation of Business. The Borrower and its Subsidiaries
possess all licenses, permits, franchises, patents, copyrights, trademarks, and
trade names, or rights thereto, necessary in all material respects to conduct
their respective businesses substantially as now conducted and as presently
proposed to be conducted, and the Borrower and its Subsidiaries are not to
Borrower's knowledge, in violation of any valid rights of others with respect to
any of the foregoing.
Section 4.13. Taxes. The Borrower and each of its Subsidiaries have
filed all tax returns (federal, state, and local) required to be filed and have
paid all taxes, assessments, and governmental charges and levies shown thereon
to be due, including interest and penalties. The federal income tax liabilities
of the Borrower and its Subsidiaries have been finally determined and satisfied
for all taxable years up to and including the taxable year ended December 31,
1998.
Section 4.14. Absence of Undisclosed Liabilities. Except as reflected
in the audited consolidated balance sheet of Borrower at December 31, 1998
(including the notes thereto), as of December 31, 1998, neither Borrower nor any
Subsidiary had any material liability or obligation whatsoever, whether accrued,
absolute, contingent, or otherwise that should, in accordance with GAAP, have
been disclosed in such financial statements and notes thereto. Since December
31, 1998, neither Borrower nor any Subsidiary has incurred any material
liability or obligation, except for liabilities and obligations incurred in the
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ordinary course of business or that will not have a material adverse effect on
Borrower.
Section 4.15. Environment. The Borrower and each Subsidiary have duly
complied in all material respects with, and their businesses, operations,
assets, equipment, property, leaseholds, other real estate owned, or other
facilities are in compliance in all material respects with, the provisions of
all federal and state, environmental, health, and safety laws, codes, and
ordinances, and all rules and regulations promulgated thereunder. Neither the
Borrower nor any Subsidiary has received notice of, nor knows of or suspects,
facts which might constitute any violations of any federal or state
environmental, health, or safety laws, codes, or ordinances, and any rules or
regulations promulgated thereunder with respect to its businesses, operations,
assets (including but not limited to real property loan collateral), equipment,
property, leaseholds, or other facilities. Set forth in EXHIBIT H is a list of
all real property owned by Borrower and/or the Subsidiaries other than real
property acquired pursuant to foreclosure of a lien in favor of Borrower or any
Subsidiary (or by deed in lieu thereof) ("Real Estate Owned") or leased by the
Borrower and its Subsidiaries at any time since December 31, 1994, wherever
located, and a brief description of the business conducted at such location.
Section 4.16. Governmental Approval. All permits, consents,
authorizations, approvals, declarations, notifications, filings or registrations
with any Governmental Authority or Regulatory Authority or any third party which
are necessary in all material respects in connection with the consummation of
this transaction have been obtained on or before the date hereof.
Section 4.17. Regulatory Compliance and Notice of Regulatory
Action. The Borrower and each Subsidiary are in compliance in all material
respects with all laws, statutes, ordinances, and governmental rules,
regulations, or requirements relating to or affecting their business or
operations. There are no outstanding notices of charges, cease-and-desist orders
(temporary or otherwise), or orders to take affirmative action issued by any
Governmental Authority or Regulatory Authority against the Borrower, any Bank or
any other Subsidiary, or any director, officer, employee or agent of the
Borrower, any Bank or any other Subsidiary. No agreement or memorandum of
understanding has been entered into between any Governmental Authority or
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Regulatory Authority and the Borrower, any Bank or any other Subsidiary or any
director, officer, employee or agent of the Borrower, any Bank or any other
Subsidiary. No notice of intention to remove from office or notice of intention
to suspend from office has been served upon any officer or director of the
Borrower, any Bank or any other Subsidiary by any Governmental Authority or
Regulatory Authority.
Section 4.18. Securities Activities. The Borrower has not issued any
securities except as were (a) duly registered under the Securities Act of 1933,
as amended, and applicable blue sky laws, or (b) validly exempt from
registration.
Section 4.19. Deposit Insurance. Each Bank is an "insured depository
institution" within the meaning of Section 3 (c)(2) of the Federal Deposit
Insurance Act, as amended.
Section 4.20. Year 2000 Compliance. The Borrower has developed a
comprehensive working plan (the "Y2K Plan") to insure that the Borrower's and
each Subsidiary's software and hardware systems which impact or affect in any
material way the business operations of the Borrower and its Subsidiaries will
be Year 2000 Compliant and Ready (defined below). The Borrower will provide to
the Lender any third party assessment of the Y2K Plan as soon as such assessment
is completed by such third party if such assessment is available. The Borrower
and its Subsidiaries have met all previous Y2K Plan milestones and will
hereafter meet all future Y2K Plan milestones so that all hardware and software
systems will be Year 2000 Compliant and Ready in accordance with the Y2K Plan,
except for any such failure to meet such milestones which would not have a
material adverse effect on the business, operations, assets or condition
(financial or otherwise) of the Borrower and its Subsidiaries on a consolidated
basis. As used herein, "Year 2000 Compliant and Ready" means that the Borrower's
and each Subsidiary's hardware and software systems with respect to the
operation of their business and their general business plan will: (i) handle
date information involving any and all dates before, during and/or after January
1, 2000, including accepting input, providing output and performing date
calculations in whole or in part; (ii) operate accurately without interruption
on and in respect of any and all dates before, during and/or after January 1,
2000 and without any change in performance; (iii) respond to and process two
digit year input without creating any ambiguity as to the century; and (iv)
store and provide input information without creating any ambiguity as to the
century. Borrower further represents and warrants that Borrower has formulated
and will promptly implement contingency plans in the event that any hardware or
software system of Borrower and/or Subsidiary is not Year 2000 Compliant and
Ready for any reason whatsoever.
Simultaneously with the delivery of each set of quarterly financial statements
pursuant to Section 5.10 hereof, Borrower shall provide Lender with a statement
of Borrower's Chief Executive Officer, Chief Financial Officer or any other
officer who has the responsibility for the Y2K Plan to the effect that nothing
14
has come to his/her attention to cause him/her to believe that the Y2K Plan
milestones have not been met in a manner such that the Borrower's and its
Subsidiaries hardware and software systems are not Year 2000 Compliant and
Ready. The requirement to provide Lender with such statement shall terminate
with respect to the second set of quarterly financial statements delivered to
Lender in the year 2000 unless, as of the date the second set of quarterly
financial statements are required to be delivered to Lender, Borrower's and its
Subsidiaries hardware and software systems are not Year 2000 Compliant and
Ready, in which cause such reporting requirements shall continue until
Borrower's and its Subsidiaries hardware and software systems are Year 2000
Compliant and Ready.
ARTICLE V
AFFIRMATIVE COVENANTS
So long as the Note or Revolving Credit/Term Note shall remain unpaid,
the Borrower will:
Section 5.01. Use of Proceeds. Use the proceeds of the Loan only for
the purposes set forth herein, and will furnish the Lender such evidence as it
may reasonably require with respect to such use.
Section 5.02. Maintenance of Existence. Preserve and maintain, and
cause each Subsidiary to preserve and maintain, its corporate existence and good
standing in the jurisdiction of its incorporation, and qualify and remain
qualified, and cause each Subsidiary to qualify and remain qualified, as a
foreign corporation in each jurisdiction in which the ownership of property or
the nature of its business makes such qualification necessary or required,
except where such failure to qualify shall not materially or adversely affect
the Borrower and its Subsidiaries taken as a whole.
Section 5.03. Maintenance of Records. Keep, and cause each Subsidiary
to keep, adequate records and books of account, in which complete entries will
be made in accordance with GAAP consistently applied, reflecting all financial
transactions of the Borrower and its Subsidiaries.
Section 5.04. Maintenance of Properties. Maintain, keep, and preserve,
and cause each Subsidiary to maintain, keep, and preserve, all of its properties
(tangible and intangible) necessary or useful in the proper conduct of its
business in good working order and condition, ordinary wear and tear excepted.
Section 5.05. Conduct of Business. Continue, and cause each Subsidiary
to continue, to engage in a business of the same general type as now conducted
by it on the date of this Agreement.
15
Section 5.06. Maintenance of Insurance. Maintain and see that its
Subsidiaries maintain, or cause to be maintained, insurance coverages including,
but not limited to, bankers' blanket bonds, public liability insurance, and fire
and extended coverage insurance on all assets owned by them, all in such form
and amounts, and with such insurers, as are reasonably satisfactory to the
Lender.
Section 5.07. Compliance with Laws. Comply, and cause each Subsidiary
to comply, in all material respects with all applicable laws, rules,
regulations, orders, and material agreements to which they are subject, such
compliance to include, without limitation, maintaining adequate cash reserves
for the payment of, and paying before the same become delinquent, all taxes,
assessments, and governmental charges imposed upon it or upon its property
except as contested in good faith.
Section 5.08. Right of Inspection. At any reasonable time and from time
to time with prior notice, permit the Lender or any agent or representatives
thereof to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Borrower and any Subsidiary, and
to discuss the affairs, finances, and accounts of the Borrower and any
Subsidiary with any of their respective officers and directors and the
Borrower's independent accountants.
Section 5.09. Deposit Insurance. The Borrower will cause each Bank to
maintain federal deposit insurance and to be a member of the Federal Deposit
Insurance Corporation (or any successor thereto).
Section 5.10. Reporting Requirements. Furnish to the Lender:
(1) Quarterly Financial Statements. As soon as available and in any
event within forty-five (45) days after the end of each of the first three (3)
quarters of each fiscal year of the Borrower, interim unaudited consolidated and
unconsolidated balance sheets of Borrower, and related statements of income,
shareholders equity and cash flows of the Borrower for the prior quarter
prepared in accordance with GAAP.
(2) Call Reports. As soon as available, and in any event within thirty
(30) days after the end of each fiscal quarter of the Borrower, copies of all
Call Reports of the Borrower and each Bank as filed with the Federal Deposit
Insurance Corporation (or any successor thereto) and/or the Comptroller of the
Currency (or any successor), signed by the chief financial officer of the
Borrower and each Bank.
(3) Annual Financial Statements. As soon as available and in any event
within one hundred twenty (120) days after the end of each fiscal year of the
Borrower, consolidated and consolidating balance sheets of the Borrower and its
16
Subsidiaries as of the end of such fiscal year and consolidated and
consolidating statements of income, shareholder's equity, and cash flows of the
Borrower and its Subsidiaries for such fiscal year, all in reasonable detail and
stating in comparative form the respective figures for the corresponding date
and period in the prior fiscal year and all prepared in accordance with GAAP and
accompanied by an opinion thereon acceptable to the Lender by Xxxxxxx & Xxxxxxx
or other accountants selected by the Borrower and acceptable to the Lender;
(4) F.R.Y.-6 Annual Report. As soon as available, and in any event
within ten (10) days after the filing thereof, a copy of the Borrower's F.R.Y.-6
Annual Report to the Federal Reserve System.
(5) Management Letters. Promptly upon receipt thereof, copies of any
reports submitted to the Borrower or any Subsidiary by independent certified
public accountants in connection with examination of the financial statements of
the Borrower or any Subsidiary made by such accountants;
(6) Certificate of No Default. Within forty-five (45) days after the
end of each of the quarters of each fiscal year of the Borrower, a certificate
of the chief financial officer of the Borrower, substantially in the form of
EXHIBIT I attached hereto and made a part hereof (a) certifying, inter alia,
that (i) the representations and warranties contained in Article IV hereof and
in each of the Loan Documents remain true and correct (except to the extent that
such representations and warranties relate solely to an earlier date), (ii) the
Borrower and Subsidiaries are in compliance with the covenants set forth herein,
and (iii) no Event of Default has occurred and is continuing or, if an Event of
Default has occurred and is continuing, a statement as to the nature thereof and
the action which is proposed to be taken with respect thereto; and (b) with
computations demonstrating compliance with the covenants contained in Article
VII;
(7) Accountant's Report. Simultaneously with the delivery of the annual
financial statements referred to in Section 5.10(3), a statement of the
independent public accountants to the effect that, in making the examination
necessary for the audit of such statements, they have obtained no knowledge of
any condition or event which constitutes an Event of Default, or if such
accountants shall have obtained knowledge of any such condition or event,
specifying in such certificate each such condition or event, of which they have
knowledge and the nature and status thereof;
(8) Notice of Litigation. Promptly after the commencement thereof,
notice of all actions, suits, and proceedings before any court or governmental
department, commission, board, bureau, agency, or instrumentality, domestic or
foreign, affecting the Borrower or any Subsidiary which, if determined adversely
to the Borrower or such Subsidiary, could have a material adverse effect on the
financial condition, properties, or operations of the Borrower or such
Subsidiary;
17
(9) Notice of Events of Default. The Borrower will notify the Lender
immediately if it becomes aware of the occurrence of any Event of Default or of
any fact, condition, or event that only with the giving of notice or passage of
time, or both, could become an Event of Default, or of the failure of the
Borrower to observe any of its undertakings hereunder;
(10) ERISA Reports. As soon as possible, and in any event within thirty
(30) days after the Borrower knows or has reason to know that any circumstances
exist that constitute grounds entitling the PBGC to institute proceedings to
terminate a Plan with respect to the Borrower or any Commonly Controlled Entity,
and promptly, but in any event within five (5) Business Days of receipt by the
Borrower or any Commonly Controlled Entity of notice that the PBGC intends to
terminate a Plan or appoint a trustee to administer the same, and promptly, but
in any event within five (5) Business Days of the receipt of notice concerning
the imposition of withdrawal liability in excess of ONE HUNDRED THOUSAND AND
NO/100 DOLLARS ($100,000.00) with respect to the Borrower or any Commonly
Controlled Entity, the Borrower will deliver to the Lender a certificate of the
chief financial officer of the Borrower setting forth all relevant details and
the action which the Borrower proposes to take with respect thereto;
(11) Proxy Statements, Etc. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements, and reports which
the Borrower or any Subsidiary sends to its stockholders, and copies of all
regular, periodic, and special reports, and all registration statements which
the Borrower or any Subsidiary files with the Securities and Exchange Commission
or any Governmental Authority which may be substituted therefor, or with any
national securities exchange;
(12) Reports to Regulatory Agencies. Promptly after the sending or
filing of the same, copies of all call reports and other reports, including
without limitation responses to administrative enforcement actions, and
modifications or amendments thereto, that the Borrower or its Subsidiaries sends
or files with any Regulatory Authority; and
(13) Notice of Regulatory Action. Promptly, written notice of (i) the
issuance of any notice of charges, cease-and-desist order (temporary or
otherwise), or order to take affirmative action by any Governmental Authority or
Regulatory Authority against the Borrower, any Bank or any other Subsidiary, or
18
any director, officer, employee or agent of the Borrower, any Bank or any other
Subsidiary, (ii) the service of any notice of intention to remove from office or
notice of intention to suspend from office by any Governmental Authority or
Regulatory Authority upon any director or officer of the Borrower, any Bank or
any other Subsidiary, (iii) the issuance of a notice of termination of the
status of any Bank as an insured bank under the Federal Deposit Insurance
Corporation Act, as amended, or (iv) the entering into of any agreement or
memorandum of understanding between any Governmental Authority or Regulatory
Authority and the Borrower, any Bank or any other Subsidiary, or any director,
officer, employee or agent of the Borrower, any Bank or any other Subsidiary.
(14) Adverse Changes. Promptly after the occurrence thereof and in no
event later than ten (10) days thereafter, full disclosures of any material
adverse changes in the finances or business of Borrower or any of its
Subsidiaries.
(15) General Information. Such other information respecting the
condition or operations, financial or otherwise, of the Borrower or any
Subsidiary as the Lender may from time to time reasonably request.
Section 5.11. Environment. Be and remain, and cause each Subsidiary to
be and remain, in all material respects, in compliance with the provisions of
all federal and state environmental, health, and safety laws, codes and
ordinances, and all rules and regulations issued thereunder; and notify the
Lender immediately of any notice of an environmental complaint received from any
governmental agency or any other party.
Section 5.12. Capital Adequacy. Maintain, and cause each Bank to
maintain, at all times, the minimum levels of regulatory capital necessary to
maintain the regulatory capital classification of "Well Capitalized," as such
term is defined by the applicable Regulatory Authority.
ARTICLE VI
NEGATIVE COVENANTS
So long as the Note or Revolving Credit/Term Note shall remain unpaid,
the Borrower will not:
Section 6.01. Liens. Create, incur and assume, or suffer to exist, or
permit any Subsidiary to create, incur, assume, or suffer to exist, any Lien
upon or with respect to any of its properties (including, without limitation,
any Lien upon all or any part of the common or capital stock of any of the
Banks), now owned or hereafter acquired, except:
19
(1) Liens in favor of the Lender;
(2) Liens for taxes or assessments or other governmental charges or
levies if not yet due and payable or, if due and payable, if they are being
contested in good faith by appropriate proceedings and for which appropriate
reserves are maintained;
(3) Liens imposed by law, such as mechanics', materialmen's,
landlords', warehousemen's, and carriers' Liens, securing obligations incurred
in the ordinary course of business which are not yet due and payable or which
are being contested in good faith by appropriate proceedings and for which
appropriate reserves have been established;
(4) Liens under workers' compensation, unemployment insurance, Social
Security, or similar legislation;
(5) Liens, deposits, or pledges to secure the performance of bids,
tenders, contracts (other than contracts for the payment of money), leases
(permitted under the terms of this Agreement), public or statutory obligations,
surety, stay, appeal, indemnity, performance, or other similar bonds, or other
similar obligations arising in the ordinary course of business;
(6) Judgment and other similar Liens arising in connection with court
proceedings, provided the execution or other enforcement of such Liens is
effectively stayed and the claims secured thereby are being actively contested
in good faith and by appropriate proceedings;
(7) Easements, rights-of-way, restrictions, and other similar
encumbrances which, in the aggregate, do not materially interfere with the
occupation, use, and enjoyment by the Borrower or any Subsidiary of the property
or assets encumbered thereby in the normal course of its business or materially
impair the value of the property subject thereto;
(8) Liens incidental to the conduct of banking business, not incurred
in connection with the borrowing of money, arising out of transactions in
federal funds, repurchase agreements, interbank credit facilities, bank
deposits, or other obligations to customers or depositors of the Borrower's
Subsidiaries.
(9) Liens incurred in connection with the borrowing by a Subsidiary
from the Federal Reserve Bank, or the Federal Home Loan Bank, in the ordinary
course of business;
(10) Those Liens specified in EXHIBIT J attached hereto and made a part
hereof; and
20
(11) Liens for purchase money security interests or Liens
incurred in connection with any conditional sale or other title retention
agreement or capital lease.
Section 6.02. Debt. Create, incur, assume, or suffer to exist, or
permit any Subsidiary to create, incur, assume, or suffer to exist, any Debt,
except:
(1) Debt of the Borrower under this Agreement, the Note, or the
Revolving Credit/Term Note ;
(2) Debt described in EXHIBIT K, and any renewals, extensions, or
refinancings of existing Debt on commercially reasonable terms(but there shall
be no voluntary prepayments of such Debt);
(3) Debt of a Subsidiary to the Federal Reserve Bank, or the Federal
Home Loan Bank, in the ordinary course of business;
(4) Accounts payable to trade creditors for goods or services which are
not aged more than sixty (60) days from the billing date and current operating
liabilities (other than for borrowed money) which are not more than sixty (60)
days past due, in each case incurred in the ordinary course of business, as
presently conducted, and paid within the specified time, unless contested in
good faith and by appropriate proceedings; and
(5) Debt of the Borrower or any Subsidiary secured by purchase money
liens and security interests permitted by Section 6.01 (11), which Debt shall
not exceed FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($400,000.00) in the
aggregate at any one time outstanding.
Section 6.03. Mergers, Acquisitions, Etc. Wind up, liquidate, or
dissolve itself, reorganize, merge, or consolidate with or into, or convey,
sell, assign, transfer, lease, or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to any Person, acquire all or
substantially all of the assets or the business of any Person, or commence or
acquire any new business not conducted by it on the date of this Agreement, or
permit any Subsidiary to do so, except that the Borrower or any Subsidiary may
merge into, consolidate with or acquire any other Person provided in each case
that immediately after giving effect thereto, no event shall occur and be
continuing which constitutes a Default or an Event of Default and, in the case
of any such merger with any other Person to which the Borrower or any Subsidiary
is a party, the Borrower or its Subsidiary is the surviving corporation. The
Lender, in its sole discretion, may consent in writing to additional exceptions.
21
Section 6.04. Leases. Create, incur, assume, or suffer to exist, or
permit any Subsidiary to create, incur, assume, or suffer to exist, any
obligation as lessee for the rental or hire of any real or personal property,
except: (1) leases existing on the date of this Agreement and any extensions or
renewals thereof; (2) leases (other than Capital Leases) which do not in the
aggregate require the Borrower and its Subsidiaries on a consolidated basis to
make payments (including taxes, insurance, maintenance, and similar expense
which the Borrower or any Subsidiary is required to pay under the terms of any
lease) in any fiscal year of the Borrower in excess of FOUR HUNDRED THOUSAND AND
NO/100 DOLLARS ($400,000.00); (3) leases between the Borrower and any Subsidiary
or between any Subsidiaries. The Lender, in its sole discretion, may consent in
writing to additional exceptions.
Section 6.05. Sale and Leaseback. Sell, transfer, or otherwise dispose
of, or permit any Subsidiary to sell, transfer, or otherwise dispose of, any
real or personal property to any Person and thereafter directly or indirectly
lease back the same or similar property.
Section 6.06. Dividends. After the date hereof, make any distribution
in respect of its capital stock or purchase, or redeem or otherwise acquire any
shares of its outstanding capital stock unless such action has been approved by
the necessary Regulatory Authorities, and provided such distribution, redemption
or acquisition shall not impair Borrower's ability to service Debt nor cause
Borrower to be in violation of any Financial Covenants contained in Article VII
of this Agreement.
Section 6.07. Sale of Assets. Sell, lease, assign, transfer, pledge,
mortgage, encumber, or otherwise dispose of, or permit any Subsidiary to sell,
lease, assign, transfer, pledge, mortgage, encumber, or otherwise dispose of,
any of its now owned or hereafter acquired assets (including, without
limitation, shares of stock and indebtedness of Subsidiaries, receivables, and
leasehold interest), except: (1) inventory disposed of in the ordinary course of
business; (2) the sale or other disposition of assets no longer used or useful
in the conduct of its business; (3) that any Subsidiary may sell, lease, assign,
or otherwise transfer its assets to the Borrower or to any other subsidiary in
the ordinary course of business consistent with past practices; and (4) sales of
loans in the ordinary course of business and sales of Real Estate Owned and all
other foreclosed assets. The Lender, in its sole discretion, may consent in
writing to additional exceptions.
22
Section 6.08. Guaranties, Etc. Assume, guarantee, endorse, or otherwise
be or become directly or contingently responsible or liable, or permit any
Subsidiary to assume, guarantee, endorse, or otherwise be or become directly or
contingently responsible or liable (including, but not limited to, an agreement
to purchase any obligation, stock, assets, goods, or services, or to supply or
advance any funds, assets, goods, or services, or an agreement to maintain or
cause such Person to maintain a minimum working capital or net worth, or
otherwise to assure the creditors of any person against loss) for obligations of
any Person, except guaranties by endorsement of negotiable instruments for
deposits or collection or similar transactions in the ordinary course of
business and except pursuant to letters of credit or other similar items
(banker's acceptances, etc.) issued by the Banks in the ordinary course of
business.
Section 6.09. Transactions with Affiliates. Enter into any transaction,
including, without limitation, the purchase, sale, or exchange of property or
the rendering of any services, with any Affiliate, or permit any Subsidiary to
enter into any transaction, including, without limitation, the purchase, sale,
or exchange of property or the rendering of any service, with any Affiliate,
except in the ordinary course of and pursuant to the reasonable requirements of
the Borrower's or such Subsidiary's business, upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person not an Affiliate, and in
compliance with all applicable regulatory and statutory requirements.
ARTICLE VII
FINANCIAL COVENANTS
So long as the Note or Revolving Credit/Term Note shall remain
unpaid:
Section 7.01. Capital Expenditures. Neither the Borrower nor the
Borrower's bank Subsidiaries will make any expenditures for fixed or capital
assets if, after giving effect thereto, the aggregate of all such expenditures
made by the Borrower or any bank Subsidiary would exceed FOUR MILLION AND NO/100
DOLLARS ($4,000,000.00) during any fiscal year. Bank may, in its sole
discretion, approve in writing exceptions to this restriction.
Section 7.02. Capital Adequacy. Maintain, and cause each Bank to
maintain, at all times, the minimum levels of regulatory capital necessary to
maintain the regulatory capital classification of "Well Capitalized," as such
term is defined by the applicable Regulatory Authority.
23
Section 7.03. Return on Assets. Income from operations after taxes,
divided by average assets, on a consolidated basis shall not be less than one
and one-tenth percent (1.10%).
Section 7.04. Return on Equity. Section 7.04. Return on Equity. Section
7.04. Return on Equity. Income from operations after taxes, divided by average
equity, on a consolidated basis shall not be less than twelve percent (12%).
Section 7.05. [Intentionally Omitted].
Section 7.06. [Intentionally Omitted].
Section 7.07. [Intentionally Omitted].
Section 7.08. Reserves. Each Bank shall maintain at all times reserves
equal to the greater of (i) one and thirty-five one hundredths percent (1.35%)
of total loans, (ii) one hundred fifty percent (150%) of Total Non-Performing
Assets, or (iii) the minimum amount required by its primary regulator; provided,
however, that Community Bank & Trust located in Union Springs, Alabama shall
only be required to comply with the covenant contained in this Section after
December 31, 1999.
Section 7.09. Asset Quality. The ratio of loans 90 days past due + non
accrual loans plus other real estate owned divided by net loans plus other real
estate owned for each Bank shall not exceed one and five tenths percent (1.5%);
provided, however, that Community Bank & Trust located in Union Springs, Alabama
shall only be required to comply with the covenant contained in this Section
after December 31, 1999.
Section 7:10. Consolidated Tangible Equity. Consolidated Tangible
Equity for Borrower and its Subsidiaries shall be greater than or equal to
$38,000,000.00. For purposes of this Agreement, Tangible Equity shall mean
equity minus intangibles.
Section 7.11. Consolidated Tangible Equity to Total Assets.
Consolidated Tangible Equity for Borrower and its Subsidiaries shall be greater
than or equal to 8% of the total consolidated assets of Borrower and its
Subsidiaries.
Section 7.12. Minimum Liquidity Requirements. Borrower and each
Subsidiary shall maintain at least the minimum levels of liquidity required for
each such entity by any applicable Regulatory Authority.
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ARTICLE VIII
EVENTS OF DEFAULT
Section 8.01. Events of Default. An Event of Default shall be deemed to
exist if any of the following events shall occur:
(1) The Borrower shall fail to pay the principal of, or interest on,
the Note or the Revolving Credit/Term Note, or any fee, within five (5) days of
its due date;
(2) Any representation, warranty or certification made or deemed made
by the Borrower in this Agreement, the Security Agreement, or any of the other
Loan Documents, or which is contained in any certificate, document, opinion, or
financial or other statement furnished at any time under or in connection with
any Loan Document, shall prove to have been incorrect, incomplete, or misleading
in any material respect on or as of the date made or deemed made;
(3) The Borrower shall fail to perform or observe any term, covenant,
condition or agreement contained herein or in any other of the Loan Documents
and such failure remains unremedied for thirty (30) days after the earlier of
its discovery by the Borrower or written notice thereof to the Borrower by the
Lender;
(4) Any Event of Default as defined (and after giving effect to any
applicable notice and/or cure periods) in any other of the Loan Documents shall
occur;
(5) The Borrower or any of its Subsidiaries shall (a) fail to pay any
indebtedness for borrowed money (other than the Note or the Revolving
Credit/Term Note) in excess of TWO HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS
($250,000.00) of the Borrower or such Subsidiary, as the case may be, when due
(whether by scheduled maturity, required prepayment, acceleration, demand, or
otherwise); or (b) fail to perform or observe any term, covenant, or condition
on its part to be performed or observed under any agreement or instrument
relating to any such indebtedness, when required to be performed or observed, if
the effect of such failure to perform or observe is to accelerate, or to permit
the acceleration of, after the giving of notice or passage of time, or both, the
maturity of such indebtedness, whether or not such failure to perform or observe
shall be waived by the holder of such indebtedness; or any such indebtedness
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), prior to the stated maturity
thereof and Borrower or its Subsidiaries fails to pay such indebtedness in full;
(6) The Borrower or any of its Subsidiaries (a) shall generally not
pay, or shall be unable to pay, or shall admit in writing its inability to pay
its debts as such debts become due; or (b) shall make an assignment for the
25
benefit of creditors, or petition or apply to any tribunal for the appointment
of a custodian, receiver, or trustee for it or a substantial part of its assets;
or (c) shall commence any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution, or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; or (d) shall have had any
such petition or application filed or any such proceeding commenced against it
in which an order for relief is entered or an adjudication or appointment is
made, and which remains undismissed for a period of sixty(60) days or more; or
(e) shall take any corporate action indicating its consent to, approval of, or
acquiescence in any such petition, application, proceeding, or order for relief
or the appointment of a custodian, receiver, or trustee for all or any
substantial part of its properties; or (f) shall suffer any such custodianship,
receivership, or trusteeship to continue undischarged for a period of sixty (60)
days or more;
(7) One or more judgments, decrees, or orders for the payment of money
in excess of ONE MILLION AND NO/100 DOLLARS($1,000,000.00) in the aggregate
shall be rendered against the Borrower or any of its Subsidiaries, and the
amount of said judgment(s) not covered by Borrower's or Subsidiaries' insurance
is in excess of FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00), and such
judgments, decrees, or orders shall continue unsatisfied and in effect for a
period of thirty (30) consecutive days without being vacated, discharged,
satisfied, or stayed or bonded pending appeal;
(8) The Security Agreement shall at any time after its execution and
delivery and for any reason cease (a) to create a valid and perfected first
priority security interest in and to the property purported to be subject to
such Security Agreement; or (b) to be in full force and effect or shall be
declared null and void, or the validity or enforceability thereof shall be
contested by the Borrower, or the Borrower shall deny it has any further
liability or obligation under the Security Agreement, or the Borrower shall fail
to perform any of its obligations under the Security Agreement;
(9) Any of the following events shall occur or exist with respect to
the Borrower and any Commonly Controlled Entity under ERISA: any Reportable
Event shall occur; complete or partial withdrawal from any Multiemployer Plan
shall take place; any Prohibited Transaction shall occur; a notice of intent to
terminate a Plan shall be filed, or a Plan shall be terminated; or circumstances
shall exist which constitute grounds entitling the PBGC to institute proceedings
to terminate a Plan, or the PBGC shall institute such proceedings; and in each
case above, such event or condition, together with all other events or
conditions, if any, could subject the Borrower to any tax, penalty, or other
liability which in the aggregate may exceed FIVE HUNDRED THOUSAND AND NO/100
DOLLARS ($500,000.00); or
26
(10) If any Governmental Authority asserts or creates a Lien upon any
or all of the assets, equipment, property, leaseholds, or other facilities of
the Borrower by reason of the occurrence of a hazardous discharge or any
environmental complaint; or if any Governmental Authority asserts a claim
against the Borrower and/or its assets, equipment, property, leaseholds, or
other facilities for damages or cleanup costs relating to a hazardous discharge
or an environmental complaint; provided, however, that such claim shall not
constitute a default if, within ten (10) Business Days of the occurrence giving
rise to the claim, (a) the Borrower can prove to the Lender's satisfaction that
the Borrower has commenced and is diligently pursuing either: (i) a cure or
correction of the event which constitutes the basis for the claim, and continues
diligently to pursue such cure or correction to completion or (ii) proceedings
for any injunction, a restraining order, or other appropriate emergency relief
preventing such Governmental Authority from asserting such claim, which relief
is granted within ten (10) Business Days of the occurrence giving rise to the
claim and the injunction, order, or emergency relief is not thereafter resolved
or reversed on appeal; and (b) in either of the foregoing events, the Borrower
has posted a bond, letter of credit, or other security satisfactory in form,
substance, and amount to both the Lender and the Governmental Authority
asserting the claim to secure the proper and complete cure or correction of the
event which constitutes the basis for the claim;
(11) If the Borrower or any Bank, or the directors, officers, or
employees thereof, becomes subject to any regulatory enforcement action, which
includes without limitation, a memorandum of understanding, written agreement,
supervisory directive, capital directive, removal action, or cease and desist
order, which regulatory enforcement action limits or restricts the ability of
Borrower or any Bank to engage in its normal business;
(12) Borrower shall fail to maintain senior management having
sufficient skill and experience in Borrower's industry to manage Borrower and
each Subsidiary competently and efficiently.
(13) If the ownership of Borrower as presently constituted shall change
such that more than twenty-five percent (25%) of the outstanding voting stock
shall be transferred to any Person other than (i) an existing shareholder who
prior to the transfer owned not less than twenty-five (25%) of the outstanding
voting stock of Borrower or (ii) an immediate family member of the transferring
shareholder.
(14) Any Bank shall be unable or shall be deemed to be unable to
declare and distribute dividends as a result of restrictions imposed by
applicable regulation or by any Regulatory Authority.
27
Section 8.02. Remedies upon Event of Default Upon the occurrence of an
Event of Default, the Lender may:
(1) By notice to the Borrower, declare the Note and/or the Revolving
Credit/Term Note all interest thereon, and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Note and/or the
Revolving Credit/Term Note, all such interest, and all such amounts shall become
and be forthwith due and payable, without presentment, demand, protest, or
further notice of any kind, all of which are hereby expressly waived by the
Borrower;
(2) At any time and from time to time, without notice to the Borrower
(any such notice being expressly waived by the Borrower), set off and apply (i)
any and all deposits (general or special, time or demand, provisional or final)
at any time held by the Lender, and (ii) other indebtedness at any time owing by
the Lender to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower, now or hereafter existing under this
Agreement, the Note, or the Revolving Credit/Term Note any other Loan Document,
irrespective of whether or not the Lender shall have made any demand under this
Agreement, the Note, the Revolving Credit/Term Note, or under any other of the
Loan Documents and although such obligations may be unmatured;
(3) Exercise from time to time any and all rights and remedies
available to a secured party when a debtor is in default under a security
agreement as provided in the Uniform Commercial Code of Georgia, or available to
Lender under any other applicable law or in equity, including without limitation
the right to any deficiency remaining after disposition of the Collateral;
(4) At its option, and without notice or demand of any kind, exercise
from time to time any and all other rights and remedies available to it under
this Agreement or any of the other Loan Documents;
(5) Borrower shall pay all of the reasonable costs and expenses
incurred by Lender in enforcing its rights under this Agreement and the other
Loan Documents. In the event any claim under this Agreement or under any of the
other Loan Documents is referred to an attorney for collection, or collected by
or through an attorney at law, Borrower will be liable to Lender for all
expenses incurred by it in seeking to enforce its rights hereunder, under any
other of the Loan Documents or in the Collateral, including without limitation
reasonable attorneys' fees; and
28
(6) Any proceeds from disposition of any of the Collateral may
be applied by Lender first to the payment of all expenses and costs incurred by
Lender in enforcing the rights of Lender under each of the Loan Documents and in
collecting, retaking, holding, preparing the Collateral for and advertising the
sale or other disposition of and realizing upon the Collateral, including
without limitation reasonable attorneys' fees actually incurred, as well as all
other legal expenses and court costs. Any balance of such proceeds may be
applied by Lender toward the payment of the Loan and in such order of
application as the Lender may from time to time elect. Lender shall pay the
surplus, if any, to Borrower. Borrower shall pay the deficiency, if any, to
Lender.
ARTICLE IX
MISCELLANEOUS
Section 9.01. Amendments, Etc. No amendment, modification, termination,
or waiver of any provision of any Loan Document to which the Borrower is a
party, nor consent to any departure by the Borrower from any Loan Document to
which it is a party, shall in any event be effective unless the same shall be in
writing and signed by 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 9.02. Notices, Etc. All notices and other communications
provided for under this Agreement and under the other Loan Documents shall be in
writing (including telex and facsimile transmissions) and mailed or transmitted
or delivered as follows:
If to the Borrower:
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention:Xx. Xxxxx Xxxxxxxx
Executive Vice President & Chief Financial Officer
Facsimile:(000) 000-0000
If to the Lender:
00 Xxxx Xxxxx
29
Mail Code: 121
Xxxxxxx, Xxxxxxx 00000
Attention: Southeastern Financial Institutions
Facsimile:(000)000-0000
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party complying as to delivery with the terms
of this Section 9.02. Except as otherwise provided in this Agreement, all such
notices and communications shall be effective when deposited in mails or sent,
answer back received via telecopier, with the original deposited in the mail,
respectively, addressed as aforesaid, except that notices to the Lender pursuant
to the provisions of Section 3.01 shall not be effective until received by the
Lender.
Section 9.03. No Waiver. No failure or delay on the part of the Lender
in exercising any right, power, or remedy granted hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right,
power, or remedy preclude any other or further exercise thereof or the exercise
of any other right, power, or remedy hereunder.
Section 9.04. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Borrower and the Lender and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights under any Loan Document to which the Borrower is a
party without the prior written consent of the Lender.
Section 9.05. Costs, Expenses, and Taxes. The Borrower agrees to pay on
demand all costs and expenses incurred by the Lender in connection with the
preparation, execution, delivery, filing, and administration of the Loan
Documents, and of any amendment, modification, or supplement to the Loan
Documents, including, without limitation, the fees and out-of-pocket expenses of
counsel for the Lender incurred in connection with advising the Lender as to its
rights and responsibilities hereunder. The Borrower also agrees to pay all such
costs and expenses, including court costs, incurred in connection with
enforcement of the Loan Documents, or any amendments, modification, or
supplement thereto, whether by negotiation, legal proceedings, or otherwise. In
addition, the Borrower shall pay any and all stamp and other taxes and fees
payable or determined to be payable in connection with the execution, delivery,
30
filing, and recording of any of the Loan Documents and the other documents to be
delivered under any such Loan Documents, and agrees to hold the Lender harmless
from and against any and all liabilities with respect to or resulting from any
delay in paying or omission to pay such taxes and fees. This provision shall
survive termination of this Agreement.
Section 9.06. Integration. This Agreement and the Loan Documents
contain the entire agreement between the parties relating to the subject matter
hereof and supersede all oral statements and prior writing with respect thereto.
Section 9.07. Indemnity. The Borrower hereby agrees to defend,
indemnify, and hold the Lender harmless from and against any and all claims,
damages, judgments, penalties, costs, and expenses (including reasonable
attorney's fees and court costs actually incurred now or hereafter arising from
the aforesaid enforcement of this clause) arising directly or indirectly from
the activities of the Borrower and its Subsidiaries, and its predecessors in
interest, or arising directly or indirectly from the Borrower's or any
Subsidiaries', or any predecessors in interest's, violation of any environmental
protection, health, or safety law, whether such claims are asserted by any
governmental agency or any other person. This indemnity shall survive
termination of this Agreement.
Section 9.08. Governing Law. This Agreement, the Note, and the
Revolving Credit/Term Note shall be governed by, and construed in accordance
with, the laws of the State of Georgia and the applicable laws of the United
States of America.
Section 9.09. Severability of Provisions. Any provision of any Loan
Document which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of such Loan
Document or affecting the validity or enforceability of such provision in any
other jurisdiction.
Section 9.10. Headings. Article and Section headings in the Loan
Documents are included in such Loan Documents for the convenience of reference
only and shall not constitute a part of the applicable Loan Documents for any
other purpose.
Section 9.11. Jury Trial Waiver. THE LENDER AND THE BORROWER HEREBY
WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM, WHETHER
IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED
TO THIS AGREEMENT OR THE LOAN DOCUMENTS. NO OFFICER OF THE LENDER HAS AUTHORITY
TO WAIVE, CONDITION, OR MODIFY THIS PROVISION.
31
[REMAINDER OF PAGE INTENTIONALLY BLANK]
32
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective officers thereunto duly authorized, as of the date first above
written.
COMMUNITY BANKSHARES, INC.
By:__________________________________
Title:
And:_________________________________
Title:
SUNTRUST BANK, ATLANTA
By:__________________________________
Title:
And:__________________________________
Title:
33
EXHIBIT A
---------
BANKS
-----
NAME OF INSTITUTION STATE OF INCORPORATION
------------------- ----------------------
1. Community Bank & Trust - Habersham Georgia
2. Community Bank & Trust - Xxxxxxx Georgia
3. Community Bank & Trust - Alabama Alabama
4. Community Bank & Trust - Xxxxx Georgia
EXHIBIT B
---------
COLLATERAL
----------
50,000 shares of the capital stock of Community Bank & Trust - Habersham more
particularly described in the Amended and Restated Stock Pledge and Security
Agreement dated July 21, 1997.
EXHIBIT D
---------
REVOLVING CREDIT NOTE
---------------------
$3,000,000.00
July 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned, Community Bankshares, Inc., a
Georgia corporation (the "Borrower"), hereby promises to pay to the order of
SUNTRUST BANK, ATLANTA (the "Bank"), at its Principal Office located at 00 Xxxx
Xxxxx, Xxxxxxx, Xxxxxxx the principal amount of THREE MILLION AND NO/ ONE
HUNDRETHS DOLLARS ($3,000,000.00) or so much thereof as may be from time to time
disbursed hereunder, in lawful money of the United States and in immediately
available funds. This Revolving Credit Note is executed and delivered as a
renewal of the Revolving Credit under the Loan Agreement hereinafter defined.
Prior to the Revolving Maturity Date, the Borrower may request
Advances to be made pursuant to this Note and repay such Advances in accordance
with the Amended and Restated Revolving Credit Agreement of even date herewith
between Borrower and Bank (as amended from time to time, the "Loan Agreement").
Interest shall accrue and be paid upon such Advances in accordance with the Loan
Agreement. Accrued but unpaid interest shall be payable on the last day of each
calendar quarter starting September 30, 1999 and on the Revolving Maturity Date.
The entire principal balance shall be due and payable on the Revolving Maturity
Date.
Any amount of principal hereof which is not paid when due (giving
effect to any applicable grace period), whether at stated maturity, by
acceleration, or otherwise, shall bear interest from the date when due until
said principal amount is paid in full, payable on demand, at a rate per annum
equal at all times to two percent (2%) above the rate which would otherwise be
applicable. Any change in the interest rate resulting from a change in the Prime
Rate shall be effective at the beginning of the day on which such change in the
Prime Rate shall become effective.
If any payment under this Note becomes due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day, and interest shall be payable thereon at the rate
herein specified during such extension.
Terms used herein which are defined in the Loan Agreement shall
have their defined meanings when used herein. The Loan Agreement, among other
things, contains provisions for acceleration of the maturity of this Note upon
the happening of certain stated events and also for prepayments on account of
principal hereof prior to the maturity of this Note upon the terms and
conditions specified in the Loan Agreement. This Note is secured by a Security
Agreement referred to in the Loan Agreement, reference to which is hereby made
for a description of the collateral provided for under the Security Agreement
and the rights of the Borrower and the Bank with respect to such collateral.
In addition to and not in limitation of the foregoing and the
provisions of the Loan Agreement, the Borrower further agrees to pay all
expenses of collection, including reasonable attorneys' fees, if this Note shall
be collected by law or through an attorney at law, or in bankruptcy,
receivership, or other court proceedings.
TIME IS OF THE ESSENCE UNDER THIS NOTE. This Note has been
delivered in Atlanta, Georgia, and shall be governed by and construed under the
laws of Georgia.
PRESENTMENT, PROTEST, AND NOTICE OF DISHONOR ARE HEREBY WAIVED BY
THE BORROWER.
IN WITNESS WHEREOF, the Borrower has caused this Note to be
executed and delivered by its duly authorized officer as of the date first above
written.
Community Bankshares, Inc.
By:________________________________
Title:__________________________
Attest:____________________________
Title:__________________________
EXHIBIT F
---------
OFFICER'S CERTIFICATE
---------------------
The undersigned certifies that he is of Community Bankshares, Inc.
(the "Company") and that as such he is familiar with the business and affairs of
the Company and is authorized to execute this Certificate on behalf of the
Company, and, with reference to the Amended and Restated Revolving Credit/Term
Loan Agreement (the "Loan Agreement") dated as of July 31, 1999, between the
Company and SunTrust Bank, Atlanta, that he duly has made such investigations as
were necessary for the provision of this Certificate and the certifications,
representations, and warranties contained herein and that he hereby further
certifies, represents, and warrants as follows:
1. That the representations and warranties of the Company
contained in Article IV of the Loan Agreement and otherwise
made in writing by or on behalf of the Company in connection
with the transactions contemplated by the Loan Agreement,
and the schedules and exhibits attached to the Loan
Agreement, are true and correct on and as of the date
hereof; and
2. That the Company has performed and complied with all
agreements and conditions contained in the Loan Agreement
required to be performed or complied with by it, and that on
and as of the date hereof no condition or lapse of time, or
both, will constitute an Event of Default as defined in
Article VIII of the Loan Agreement.
3. That neither the execution, delivery, and performance
of the Loan Agreement or of the Note nor fulfillment of or
compliance with the terms and provisions thereof will
conflict with, or result in a breach of, the terms,
conditions, or provisions of or constitute a default under,
or result in any violation of, any other agreement to which
the Company or any of its Subsidiaries is subject. Neither
the Company nor any Subsidiary is a party to, or otherwise
subject to any provision contained in, any instrument
evidencing indebtedness of the Company or such Subsidiary,
any agreement relating thereto, or any other contract or
agreement which limits the amount of, or otherwise imposes
restrictions on the incurring of the type of debt to be
evidenced by the Note.
4. That there has been no material adverse change in the
assets, liabilities, financial positions, operations or
business prospects of Borrower since December 31, 1998.
Capitalized terms not otherwise defined herein are defined as set
forth in the Loan Agreement.
WITNESS the seal of the Company and the signature of the
undersigned, as of this _____ day of __________,_______________.
By:_________________________________
Title: _________________________
EXHIBIT G
---------
SCHEDULE OF LITIGATION
----------------------
None
EXHIBIT H
SCHEDULE OF REAL ESTATE OWNED
Community Bankshares
Fixed Asset Schedule
Current Book Value
Buildings Land Total
HABERSHAM
0 Xxxxx Xx., Xxxxxxxx (xxxxxx office) ............. 58,246 0 58,246
000 Xxxxx Xxxx Xx., Xxxxxxxx (main office) ........ 274,974 145,307 420,281
000 X. Xxxx Xx., Xxxxxxxx (operations center) ..... 349,390 0 349,390
000 X. Xxxxxxxxxx Xx., Xxxxxxxxxxxx (xxxxxx office) 138,439 50,652 189,091
000 X. Xxxx Xx., Xxxxxxxx (future expansion) ...... 130,500 0 130,500
Hwy. 441 By-Pass, Cornelia (ATM property) ......... 0 75,424 00,000
Xxx. 000 X., Xxxxxxxx (xxxxxxxxxx property) ....... 0 242,372 242,372
-------
Habersham Total Buildings and Land ....... 1,465,304
XXXXXXX
00 X. Xxx Xxxxxx, Xxxxxxxx (main office) .......... 585,145 2,500 587,645
XXXXX
000 Xxxxx Xx., XxXxxxxx (main office) ............. 408,407 405,650 814,057
ALABAMA
000 X. Xxxxxx Xx., Xxxxx Xxxxxxx (main office) .... 512,175 65,196 577,371
EXHIBIT I
CERTIFICATE OF NO DEFAULT AND RELATED MATTERS
The undersigned, being, respectively, the ______________ and
_______________ of , a ____________ corporation ("Borrower"), hereby give this
Certificate to SunTrust Bank, Atlanta ("Bank") pursuant to Section 5.10 of that
certain Amended and Restated Revolving Credit/Term Loan Agreement dated July 31,
1999 between Borrower and Bank (the "Loan Agreement"; unless otherwise defined
herein, the capitalized terms shall have the meanings ascribed thereto in the
Loan Agreement) hereby certify as follows:
1. They are, respectively, _____________________ and _____________________
of Borrower and, in such capacities, are authorized and empowered to
issue this Certificate for and on behalf of Borrower.
2. The representations and warranties of Borrower set forth in the Loan
Agreement and any other of the documents executed in connection
therewith, the terms of which are incorporated herein by reference, are
true and correct in all material respects on and as of the date hereof
with the same effect as though made and on as of the date hereof.
3. The Borrower is, on the date hereof, in compliance with all the terms
and provisions set forth in the Loan Agreement and the other documents
executed in connection therewith.
4. On the date hereof, no default or Event of Default, nor any event or
condition which with notice, lapse of time, or any combination thereof,
would constitute such an Event of Default, has occurred or is
continuing.
5. The quarterly financial statements delivered herewith pursuant to
Section 5.09 of the Loan Agreement present the financial condition of
Borrower and its Subsidiaries fairly and accurately and not misleading
in the context in which presented.
6. Borrower and its Subsidiaries are in compliance with the financial
covenants set forth in Article VII of the Loan Agreement and the
following computations demonstrate compliance therewith:
[list relevant financial covenants]
7. No regulatory or other impediment exists which would impair or prohibit
the payment of dividends by the Banking Subsidiaries to the Bank.
8. No litigation, investigation, proceeding, injunction, writ or
restraining order or regulatory enforcement action is pending or
threatened.
IN WITNESS WHEREOF, the undersigned have set their hands and seals,
this _____ day of _____________, ___.
______________________________(SEAL)
Name/Title:___________________
______________________________(SEAL)
Name/Title:___________________
EXHIBIT J
---------
PERMITTED LIENS
---------------
None
EXHIBIT K
---------
PERMITTED DEBT
--------------
None
