Re: Amended and Restated Loan Agreement entered into as of January 1, 2000
Exhibit
10.1
[ASTORIA
FINANCIAL CORPORATION LETTERHEAD]
August
29, 2008
BY
CERTIFIED MAIL, NO. 0000 0000 0000 9306 2482
RETURN
RECEIPT REQUESTED
Astoria
Federal Savings and Loan Association
Employee
Stock Ownership Plan Trust
c/o
Prudential Bank & Trust, FSB, Trustee
000
Xxxxxxxx Xxxxxx, 0xx Floor
Hartford,
CT 06103
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Re:
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Amended
and Restated Loan Agreement entered into as of January 1,
2000
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Ladies
and Gentlemen:
This
letter is furnished to you by Astoria Financial Corporation ("AFC") to clarify
certain rights and obligations of AFC and the Astoria Federal Savings and
Loan
Association Employee Stock Ownership Plan Trust (the "ESOP Trust") under
the
following documents:
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▪
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Amended
and Restated Loan Agreement by and between Astoria Federal Savings
and
Loan Association Employee Stock Ownership Plan Trust and Astoria
Financial
Corporation made and entered into as of January 1, 2000 (the "Astoria
Loan
Agreement");
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▪
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Promissory
Note of Astoria Federal Savings and Loan Association Employee Stock
Ownership Plan Trust dated January 1, 2000 (the "Astoria Promissory
Note");
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▪
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Pledge
Agreement made as of January 1, 2000 by and between Astoria Federal
Savings and Loan Association Employee Stock Ownership Plan Trust
and
Astoria Financial Corporation (the "Astoria Pledge
Agreement");
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▪
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Amended
and Restated Loan Agreement by and between The Long Island Savings
Bank
Employee Stock Ownership Plan Trust and Astoria Financial Corporation
made
and entered into as of January 1, 2000 (the "LISB Loan Agreement,"
and,
together with the Astoria Loan Agreement, the "Loan
Agreements");
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▪
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Promissory
Note of The Long Island Savings Bank FSB Employee Stock Ownership
Plan
Trust dated January 1 2000 (the "LISB Promissory Note," and, together
with
the Astoria Promissory Note," the "Promissory Notes");
and
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Astoria
Federal Savings and Loan Association Employee Stock Ownership Plan
Trust
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August
29, 2008
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Page
2.
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▪
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Pledge
Agreement made as of January 1, 2000 by and between The Long Island
Savings Bank FSB Employee Stock Ownership Plan Trust and Astoria
Financial
Corporation (the "LISB Pledge Agreement," and, taken together with
the
Astoria Pledge Agreement, the "Pledge
Agreements").
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These
documents are collectively referred to in this letter as the "Loan
Documents."
1. Payment
on Default Not Reduced by Expenses.
AFC
understands that a concern exists that the Loan Documents (including but
not
limited to section 6(a) of each of the Pledge Agreements) may confer upon
AFC
the right, and impose on the ESOP Trust the obligation to allow AFC, to take
recourse against the ESOP Trust or its assets for AFC's expenses in connection
with collateral surrendered by the ESOP Trust in the event of default, and
to
require the ESOP Trust to pay an amount greater than the amount of the actual
default in satisfaction of its obligations under the Loan Documents on an
event
of default. AFC
hereby confirms its position that the Loan Documents do not confer on it
such a
right or impose on the ESOP Trust such an obligation. For avoidance of further
doubt, AFC, for itself and its successors and assigns, hereby permanently
and
irrevocably waives any right that it may have, and any obligation that the
ESOP
Trust may have to allow AFC, under the Loan Documents, to take recourse against
the ESOP Trust or its assets for AFC's expenses in connection with collateral
surrendered by the ESOP Trust in the event of default, or to require the
ESOP
Trust to pay an amount greater than the amount of the actual default in
satisfaction of its obligations under the Loan Documents on an event of default
under the Loan Documents.
2. No
Loan Acceleration.
AFC
understand that a concern exists that the Loan Documents (including but not
limited to the fifth paragraph of each of the Promissory Notes) may confer
on
AFC the right, and impose on the ESOP Trust the obligation, to cause assets
of
the ESOP to be transferred upon default in excess of the extent of the failure
of the ESOP Trust to meet the payment schedule under the Loan Documents,
and to
require the ESOP Trust to pay an amount greater than the amount of the actual
default in satisfaction of its obligations under the Loan Documents on an
event
of default. AFC hereby confirms its position that the Loan Documents do not
confer on it such a right or impose on the ESOP Trust such an obligation.
For
avoidance of further doubt, AFC, for itself and its successors and assigns,
hereby permanently and irrevocably waives any right that it may have, and
any
obligation that the ESOP Trust may have, under the Loan Documents, to cause
assets of the ESOP to be transferred upon default in excess of the extent
of the
failure of the ESOP Trust to meet the payment schedule under the Loan Documents,
and to require the ESOP Trust to pay an amount greater than the amount of
the
actual default in satisfaction of its obligations under the Loan Documents
on an
event of default under the Loan Documents.
3. Scope
of Waivers.
This
letter shall be interpreted, administered and enforced in such manner as
shall
be necessary to cause the Loan Documents to provide that (a) the loans made
pursuant to the Loan Agreements (the "Loans") shall be without recourse against
the ESOP, except to the extent permitted by 29 C.F.R. § 2550.408b-3(e); (b)
in the event of default upon one of the Loans, the value of plan assets
transferred in satisfaction of that Loan shall not exceed the amount of
Astoria
Federal Savings and Loan Association Employee Stock Ownership Plan
Trust
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August
29, 2008
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Page
3.
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default,
except to the extent permitted by 29 C.F.R. § 2550.408b-3(f); and (c) a
transfer of ESOP assets upon default shall be made only upon and to the extent
of the failure of the plan to meet the payment schedule of the respective
Loan,
except to the extent permitted by 29 C.F.R. § 2550.408b-3(f).
4. Effect
of this Letter.
This
letter constitutes a waiver of AFC's rights and the obligations of the ESOP
Trusts under the Loan Documents with respect to the matters described herein
as
contemplated by section 6.3 of the Loan Agreement, shall have the same force
and
effect as an amendment to each and every Loan Document with respect to the
matters waived, and shall, upon delivery to you, constitute a "Loan Document"
within the meaning of Section 1.8 of the Loan Agreements. This waiver shall
be
binding on AFC and its successors and assigns without any action on the part
of
the ESOP Trust.
Kindly
indicate receipt of this letter by countersigning the enclosed copy of this
letter in the signature block provided below and returning it in the postage
prepaid envelope provided.
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ASTORIA
FINANCIAL CORPORATION
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By:
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/s/
Xxxx X. Xxxxxxxxx
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Name:
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Xxxx
X. Xxxxxxxxx
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Title:
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Executive
Vice President, Secretary and General
Counsel
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cc:
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Astoria
Federal Savings and Loan Association Employee Stock Ownership Plan
Trust,
care of Astoria Federal Savings and Loan
Association
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Accepted
and Agreed to:
ASTORIA
FEDERAL SAVINGS AND LOAN ASSOCIATION EMPLOYEE
STOCK
OWNERSHIP PLAN TRUST (for
itself and as successor to The
Long
Island Savings Bank FSB Employee Stock Ownership Plan
Trust
)
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By:
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PRUDENTIAL
BANK & TRUST, FSB (successor
to State Street
Bank
and Trust Company as trustee of the Astoria
Federal
Savings
and Loan Association Employee Stock Ownership
Plan
Trust and successor to CG Trust Company as trustee
of
The
Long Island Savings Bank FSB Employee Stock
Ownership
Plan
Trust)
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By:
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/s/
Xxxxxx Xxxxxxxx
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Name:
Xxxxxx Xxxxxxxx
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Title:
Trust Officer
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