AMENDED AND RESTATED LOAN AGREEMENT
Exhibit
10.1
AMENDED
AND RESTATED LOAN AGREEMENT
This
AMENDED AND RESTATED LOAN AGREEMENT (the “Agreement”), dated as of February 28,
2007, is entered into between CORUS BANKSHARES, INC., a Minnesota corporation
(the “Borrower”), and LASALLE BANK NATIONAL ASSOCIATION, a national banking
association (the “Bank”)
RECITALS:
WHEREAS,
the Borrower and Bank entered into that certain Loan Agreement dated as of
June
26, 2001, which agreement has been amended from time to time (collectively,
the
“Original Loan Agreement”);
WHEREAS,
the Borrower and Bank have agreed to additional modifications to the Original
Loan Agreement and the parties hereto agree that it is in their best interests
to amend and restate their credit arrangement into a unified
document;
WHEREAS,
the indebtedness owing by Borrower to the Bank will continue to be secured
by
100% of the capital stock (the “Subsidiary Shares”) of CORUS BANK, NATIONAL
ASSOCIATION, a national banking association (the “Subsidiary”);
NOW,
THEREFORE, in consideration of the mutual representations, warranties, covenants
and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereto hereby agree as follows:
AGREEMENT:
1. Commitment
of the Bank.
The
Bank
agrees to extend a Revolving Loan to the Borrower in the principal amount of
up
to ONE HUNDRED FIFTY MILLION DOLLARS ($150,000,000) (the “Revolving Loan”). The
Revolving Loan will be evidenced by the Note (as such term is defined below),
and secured by the Pledge Agreement (as such term is defined below) in
accordance with terms and subject to the conditions set forth in this Agreement,
the Note and the Pledge Agreement.
2. Conditions
of Borrowing.
Notwithstanding
any other provision of this Agreement, the Bank shall not be required to fund
advances under the Loan:
(a) if,
since
the date of this Agreement and up to the agreed upon date of any Loan, there
has
occurred, in the exercise of Bank’s reasonable business judgment, a material
adverse change in the financial condition or affairs of the Borrower or the
Subsidiary;
(b) if
any
Default (as such term is defined below) has occurred or any event which, with
the giving of notice or lapse of time, or both, would constitute such a
Default;
(c) if
any
litigation or governmental proceeding has been instituted or threatened against
the Borrower or the Subsidiary or any of its officers or shareholders which
in
the reasonable business judgment of the Bank will adversely affect the financial
condition or operations of the Borrower or the Subsidiary;
(d) if
the
Borrower shall not have tendered for delivery the Revolving Note and that
certain Amended and Restated Pledge and Security Agreement (the “Pledge
Agreement”) dated of even date herewith executed by Borrower for the benefit of
Bank, together with all of the Pledged Security (as such term is defined in
the
Pledge Agreement) all in form and content satisfactory to the Bank;
(e) if
the
Borrower shall not have tendered for delivery concurrently with the execution
of
this Agreement a legal opinion from the Borrower’s counsel in form and substance
satisfactory to the Bank and Bank’s legal counsel; or
(f) if
the
Bank shall not have received in substance and form satisfactory to the Bank,
all
certificates, affidavits, schedules, resolutions, opinions, notes, and/or other
documents which are provided for hereunder, or which it may reasonably
request.
3. Note
Evidencing Borrowing.
The
Loans
shall be evidenced by a Revolving Note (the “Revolving Note”), executed by the
Borrower in the principal amount of $150,000,000 and shall be in the form set
forth in Exhibit
A
hereto
(the Revolving Note is sometimes hereafter referred to as the “Note”). Without
in any way limiting the terms of the Note:
(a) The
Borrower shall pay interest on amounts outstanding under the Note as provided
herein. Interest shall be payable quarterly, in arrears, commencing on March
31,
2007 and continuing on the last day of each of March, June and September and
December thereafter, with a final payment of all outstanding amounts due under
the Notes, including, but not limited to principal, interest and any amounts
owing under Subsection 10(k) of the Agreement, if not sooner paid, on February
28, 2010 (the “Maturity Date”). The amounts outstanding from time to time shall
bear interest calculated on the actual number of days elapsed on the basis
of a
360 day year, at the Borrower’s option of the following:
(i) the
“Prime Rate” minus 100 basis points. Prime Rate shall mean the floating prime
rate in effect from time to time as set by the Bank, and referred to by the
Bank
as its Prime Rate. The Borrower acknowledges that the Prime Rate is not
necessarily the Bank’s lowest or most favorable rate of interest at any one
time. The effective date of any change in the Prime Rate shall for purposes
hereof be the date the rate change is publicly announced by the Bank. Requests
for Prime Rate advances must be received by Bank no later than 11:00 a.m.
Chicago, Illinois time, on the same day they are to be funded; or
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(ii) “LIBOR”,
which shall mean a rate of interest equal to 140 basis points in excess of
the
per annum rate of interest equal to the offered rate for deposits in United
States dollars for a period equal to such Interest Period as published in
Bloomberg’s LIBOR BBA US Dollar Fixing Report at 11:00 a.m. (Chicago time) two
Business Days prior to the first day of such Interest Period, such rate to
remain fixed for the applicable Interest Period. “Interest Period” shall mean a
three month period (except that the first and last periods of the Loan may
be
less than a 90 day period) as selected by the Borrower by notice given to the
Bank not less than three banking days prior to the first day of each respective
Interest Period; provided that: (i) the final Interest Period shall be such
that
its expiration occurs on or before the stated maturity date of the Note; and
(ii) each LIBOR Rate Loan elected by Borrower shall automatically renew for
an
additional Interest Period at LIBOR unless Borrower shall irrevocably request,
in writing, a coversion of all or a portion of the LIBOR Rate Loan, no later
than 2:00 Chicago time on the second (2nd)
Busines
Day before the expiration of the existing Interest Period. Interest on each
LIBOR Loan shall be payable on the last day of each December, March, June and
September hereafter, at maturity, or after maturity on demand.
(a) Subject
to the provisions of this Agreement, Borrower shall have the option (i) as
of
any date, to convert all or any part of the Prime Rate Loans to, or request
that
new Loans be made as, LIBOR Rate Loans (if Borrower requests a new Loan as
a
LIBOR Rate Loan, the interest rate shall be fixed at the same rate as any
existing LIBOR Rate Loans for the then remaining portion of the applicable
Interest Period), (ii) as of the last day of any Interest Period, to continue
all or any portion of the relevant LIBOR Rate Loans as LIBOR Rate Loans; (iii)
as of the last day of any Interest Period, to convert all or any portion of
the
LIBOR Rate Loans to Prime Rate Loans; and (iv) at any time, to request new
Loans
as Prime Rate Loans; provided, that Loans may not be continued as or converted
to LIBOR Rate Loans, if the continuation or conversion thereof would violate
the
provisions of subparagraph (b) or(c) hereof or if an Event of Default has
occurred.
(b) Lender’s
determination of LIBOR as provided above shall be conclusive, absent manifest
error. Furthermore, if Lender determines, in good faith (which determination
shall be conclusive, absent manifest error), prior to the commencement of any
Interest Period that (i) U.S. Dollar deposits of sufficient amount and maturity
for funding the Loans are not available to Bank in the London Interbank
Eurodollar market in the ordinary course of business, or (ii) by reason of
circumstances affecting the London Interbank Eurodollar market, adequate and
fair means do not exist for ascertaining the rate of interest to be applicable
to the Loans requested by Borrower to be LIBOR Rate Loans or the Loans bearing
interest at the rates set forth in this paragraph shall not represent the
effective pricing to Bank for U.S. Dollar deposits of a comparable amount for
the relevant period (such as for example, but not limited to, official reserve
requirements required by Regulation D to the extent not given effect in
determining the rate), Bank shall promptly notify Borrower and (x) all existing
LIBOR Rate Loans shall convert to Prime Rate Loans upon the end of the
applicable Interest Period, and (y) no additional LIBOR Rate Loans shall be
made
until such circumstances are cured.
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(c) If,
after
the date hereof, the introduction of, or any change in any applicable law,
treaty, rule, regulation or guideline or in the interpretation or administration
thereof by any governmental authority or any central bank or other fiscal,
monetary or other authority having jurisdiction over Bank or its lending offices
(a “Regulatory Change”), shall, in the opinion of counsel to Bank, make it
unlawful for Bank to make or maintain LIBOR Rate Loans, then Bank shall promptly
notify Borrower and no additional LIBOR Rate Loans shall be made until such
circumstance is cured.
(d) If,
for
any reason, a LIBOR Rate Loan is paid prior to the last Business Day of any
Interest Period or if a LIBOR Rate Loan does not occur on a date specified
by
Borrower in its request (other than as a result of a default by Bank), Borrower
agrees to indemnify Bank against any loss (including any loss on redeployment
of
the deposits or other funds acquired by Bank to fund or maintain such LIBOR
Rate
Loan) cost or expense incurred by Bank as a result of such
prepayment.
(e) If
any
Regulatory Change (whether or not having the force of law) shall (i) impose,
modify or deem applicable any assessment, reserve, special deposit or similar
requirement against assets held by, or deposits in or for the account of or
loans by, or any other acquisition of funds or disbursements by, Bank; (ii)
subject Bank or the LIBOR Rate Loans to any Tax (“Tax” shall mean in
relation to any LIBOR Rate Loans and the applicable LIBOR Rate, any tax, levy,
impost, duty, deduction, withholding or charges of whatever nature required
(i)
to be paid by Bank and/or (ii) to be withheld or deducted from any payment
otherwise required hereby to be made by Borrower to Bank; provided, that the
term “Tax” shall not include any taxes imposed upon the net income of Bank) or
change the basis of taxation of payments to Bank of principal or interest due
from Borrower to Bank hereunder (other than a change in the taxation of the
overall net income of Bank); or (c) impose on Bank any other condition regarding
the LIBOR Rate Loans or Bank’s funding thereof, and Bank shall determine (which
determination shall be conclusive, absent any manifest error) that the result
of
the foregoing is to increase the cost to Bank of making or maintaining the
LIBOR
Rate Loans or to reduce the amount of principal or interest received by Bank
hereunder, then Borrower shall pay to Bank, on demand, such additional amounts
as Bank shall, from time to time, determine are sufficient to compensate and
indemnify Bank from such increased cost or reduced amount.
(f) Bank
shall receive payments of amounts of principal of and interest with respect
to
the LIBOR Rate Loans free and clear of, and without deduction for, any Tax.
If
(1) Lender shall be subject to any Tax in respect of any LIBOR Rate Loans or
any
part thereof or, (2) Borrower shall be required to withhold or deduct any Tax
from any such amount, the LIBOR Rate applicable to such LIBOR Rate Loans shall
be adjusted by Bank to reflect all additional costs incurred by Bank in
connection with the payment by Bank or the withholding by Borrower of such
Tax
and Borrower shall provide Bank with a statement detailing the amount of any
such Tax actually paid by Borrower. Determination by Bank of the amount of
such
costs shall be conclusive, absent manifest error. If after any such adjustment
any part of any Tax paid by Bank is subsequently recovered by Bank, Bank shall
reimburse Borrower to the extent of the amount so recovered. A certificate
of an
officer of Lender setting forth the amount of such recovery and the basis
therefor shall be conclusive, absent manifest error.
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(g) Each
Request for an advance shall be in increments of not less than
$100,000.
(h) Unless
otherwise specified by Borrower, all Loans shall be Prime Rate
Loans.
(i) No
more
than one Interest Period may be in effect with respect to outstanding LIBOR
Rate
Loans at any one time.
(b) Principal
on the Revolving Loan shall be due and payable on the Maturity Date. Prepayments
of the Revolving Loan are permitted at any time without premium or
penalty.
(c) Any
amount of principal or interest on the Notes which is not paid when due, whether
at stated maturity, by acceleration or otherwise shall bear interest payable
on
demand at an interest rate equal at all times to two percent (2%) above the
Prime Rate.
(d) If
any
payment to be made by the Borrower hereunder shall become due on a Saturday,
Sunday or Bank holiday under the laws of the State of Illinois, such payment
shall be made on the next succeeding business day and such extension of time
shall be included in computing any interest in respect of such
payment.
4. Unused
Loan Fee.
In
consideration of the Bank making the Loan available to the Borrower, the
Borrower agrees to pay to the Bank a fee (the “Unused Loan Fee”) of 3/8% per
annum of the amount not borrowed hereunder, payable on the last day of each
December, March, June and September hereafter, and calculated by multiplying
(a)
the average difference during any quarterly period between the amount available
hereunder and the total amount actually borrowed hereunder, and (b) 3/8% divided
by 4. Such amount shall be due and payable ten (10) days after the end of each
quarter set forth above.
5. Representations
and Warranties.
To
induce
the Bank to make the Loan provided for herein, the Borrower represents and
warrants as follows:
(a) The
Borrower: (i) is a corporation duly organized and validly existing and in good
standing under the laws of the State of Minnesota; (ii) is duly qualified as
a
foreign corporation and in good standing in all states in which it is doing
business except where the failure to so qualify would not have a material
adverse effect on the Borrower or its business; and (iii) has all requisite
power and authority, corporate or otherwise, to own, operate and lease its
properties and to carry on its business as now being conducted. The Subsidiary
is a national banking association, and has all requisite power and authority,
corporate or otherwise, to own, operate and lease its property and to carry
on
its business as now being conducted. The Borrower and the Subsidiary have made
payment of all franchise and similar taxes in all of the respective
jurisdictions in which they are incorporated or qualified, and so far as such
taxes are due and payable at the date of this Agreement, except for any such
taxes the validity of which is being contested in good faith and for which
proper reserves have been set aside on the books of the Borrower or the
Subsidiary, as the case may be.
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(b) The
Subsidiary Shares have been duly authorized, legally and validly issued, fully
paid and nonassessable, and are owned by the Borrower free and clear of all
pledges, liens, security interest, charges or encumbrances, except, upon
consummation of the transactions contemplated herein, for the security interest
granted by the Borrower to the Bank. There are, as of the date hereof, no
outstanding options, rights or warrants obligating the Borrower or the
Subsidiary to issue, deliver or sell, or cause to be issued, delivered or sold,
additional shares of the capital stock of the Subsidiary or obligating the
Borrower or the Subsidiary to grant, extend or enter into any such agreement
or
commitment.
(c) The
financial statements of:
(i) the
Borrower, all of which have heretofore been furnished to the Bank, have been
prepared in accordance with generally accepted accounting principles
consistently applied (“GAAP”) and maintained by the Borrower throughout the
periods involved, and fairly present the financial condition of the Borrower
individually and on a consolidated basis at such dates specified therein and
the
results of its operations for the periods then ended; and
(ii) the
Subsidiary, all of which have heretofore been furnished to the Bank, to the
best
knowledge of the Borrower have been prepared in accordance with GAAP and
maintained by each Subsidiary throughout the periods involved, and fairly
present the financial condition of the Subsidiary at such dates specified
therein and the results of its operation for the periods then
entered.
(d) The
Borrower’s primary business is that of a bank holding company, and all necessary
regulatory approvals have been obtained for it to conduct its
business.
(e) The
deposit accounts of the Subsidiary are insured by the Federal Deposit Insurance
Corporation (“FDIC”).
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(f) None
of
the Pledged Stock constitutes margin stock, as defined in Regulation U of the
Board of Governors of the Federal Reserve System (“FRS”).
The
foregoing representations and warranties shall survive the making of this
Agreement, and execution and delivery of the Note and the Pledge Agreement,
and
shall be deemed to be continuing representations and warranties (except
to the extent any such representation, warranty or other statement expressly
relates to an earlier date, in which case such representation, warranty or
other
statement shall be true and correct as of such earlier date) until
such time as the Borrower has satisfied all of its obligations to the Bank,
including, but not limited to the obligation to pay in full all principal,
interest and other amounts in accordance with the terms of this Agreement or
the
Note.
6. Negative
Covenants.
The
Borrower agrees that until the Borrower satisfies all of its obligations to
the
Bank, including, but not limited to its obligations to pay in full all
principal, interest and other amounts owing in accordance with the terms of
this
Agreement or the Note, the Borrower shall not itself, nor shall Borrower cause,
permit or allow the Subsidiary to:
(a) create,
assume, incur, have outstanding, or in any manner become liable in respect
of
any indebtedness for borrowed money in
excess
of $100,000,000, excluding indebtedness existing on the date hereof shown on
Borrower’s financial statements, without the express prior written consent of
Bank, which consent shall not be unreasonably withheld,
except
in the case of Borrower, secured indebtedness under Section 6(b)(vi) or margin
securities loans under Section 6(b)(ix), and, in the case of the Subsidiary,
indebtedness incurred in the ordinary course of the business of banking,
including, but not limited to borrowings from the Federal Home Loan Bank and
in
accordance with applicable laws and regulations and safe and sound banking
practices. For purposes of this Agreement, the phrase “indebtedness” shall mean
and include:
(i) all
items
arising from the borrowing of money, which according to generally accepted
accounting principles now in effect, would be included in determining total
liabilities as shown on the balance sheet;
(ii) all
indebtedness secured by any lien on property owned by the Borrower whether
or
not such indebtedness shall have been assumed;
(iii) all
guarantees and similar contingent liabilities in respect to indebtedness of
others; and
(iv) all
other
interest-bearing obligations evidencing indebtedness in others;
(b) create,
assume, incur, suffer or permit to exist any mortgage, pledge, deed of trust,
encumbrance (including the lien or retained security title of a conditional
vendor) security interest, assignment, lien or charge of any kind or character
upon or with respect to any of their properties whether owned at the date hereof
or hereafter acquired, or assigned or otherwise convey any right to receive
income excepting only:
(i) liens
for
taxes, assessments or other governmental charges for the then current year
or
which are not yet due or delinquent;
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(ii) liens
for
taxes, assessments or other governmental charges already due, but the validity
of which is being contested at the time in good faith in such a manner as not
to
make the property forfeitable;
(iii) liens
and
charges incidental to current operation which are not due or
delinquent;
(iv) liens
for
workmen’s compensation awards not due or delinquent;
(v) pledges
or deposits to secure obligations under workmen’s compensation laws or similar
legislation;
(vi) purchase
money mortgages or other liens on real property including those incurred for
the
construction of a banking facility, and bank furniture and fixtures acquired
or
held in the ordinary course of business to secure the purchase price of such
property or to secure the indebtedness incurred solely for the purpose of
financing the acquisition, construction or improvement of any such property
to
be subject to such mortgages or other liens, or mortgages or other liens
existing on any such property at the time of acquisition, or extensions,
renewals, or replacements of any of the foregoing for the same or a lesser
amount, provided that no such mortgage or other liens shall extend to or cover
any property other than the property being acquired, constructed or improved,
and no such extension, renewal or replacement shall extend to or cover any
property not theretofore subject to the mortgage or lien being extended, renewed
or replaced, and provided further that no such mortgage or lien shall exceed
75%
of the price of acquisition, construction or improvement at the time of
acquisition, construction or improvement, and provided, further that the
aggregate principal amount of consolidated indebtedness at any one time
outstanding and secured by mortgages, liens, conditional sale agreements and
other security interests permitted by this clause (vi) shall not exceed 10%
of
the consolidated capital of the Borrower or the Subsidiary, as the case may
be;
(vii) liens
existing on the date hereof as shown on their financial statements;
(viii) in
the
case of the Subsidiary, liens incurred in the ordinary course of the business
of
banking and in accordance with applicable laws and regulations and safe and
sound banking practices; and
(ix) loans
to
Borrower for which Borrower has pledged “margin securities” in an amount not to
exceed 60% of the market value of such margin securities.
(c) dispose
by sale, assignment, lease or otherwise property or assets now owned or
hereafter acquired, outside the ordinary course of business in excess of 10%
of
its consolidated assets in any fiscal year;
(d) merge
into or consolidate with or into any other person, firm or
corporation;
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(e) make
any
loans or advances whether secured or unsecured to any person, firm or
corporation, other than (i) loans or advances made by the Subsidiary in the
ordinary course of its banking business, or (ii) participations in loans or
advances made by the Subsidiary, which loans are secured by first mortgages
on
real estate or second mortgages on real estate, provided that the Borrower
and
the Subsidiary hold, in its entirety, the first mortgage, and in which the
aggregate participations balances outstanding, do not exceed, at any one time,
$150,000,000;
(f) engage
in
any business or activity not permitted by all applicable laws and regulations,
including without limitation, the Bank Holding Company Act of 1956, the Federal
Deposit Insurance Act and any regulations promulgated thereunder;
(g)
make any
loan or advance secured by the capital stock of another bank or depository
institution (except for loans made in the ordinary course of
business);
(h) directly
or indirectly create, assume, incur, suffer or permit to exist any pledge,
encumbrance, security interest, assignment, lien or charge of any kind or
character on the Subsidiary Shares;
(i) cause
or
allow the percent of Subsidiary Shares to diminish as a percentage of the
outstanding capital stock of the Subsidiary;
(j) sell,
transfer, issue, reissue, exchange or grant any option with respect to the
Subsidiary Shares;
(k) change
the capital structure of Borrower or the Subsidiary which would result in a
change in control under applicable laws or regulations, or ;
(l) breach
or
fail to perform or observe any of the terms and conditions of the Note, the
Pledge Agreement or any other document or agreement entered into or delivered
in
connection with, or relating to, the Loan;
(m) violate
any law or regulation, or any condition imposed by or undertaking provided
to
the FRS or the FDIC in connection with the Borrower’s ownership of the
Subsidiary Shares.
7. Affirmative
Covenants.
The
Borrower agrees that until the Borrower satisfies all of its obligations to
the
Bank, including, but not limited to its obligations to pay in full all
principal, interest and other amounts in accordance with the terms of this
Agreement, the Note and the Pledge Agreement, it shall:
(a) furnish
and deliver to the Bank:
(i) as
soon
as practicable, and in no event later than forty-five (45) days after the end
of
each of the first three calendar quarterly periods of the Borrower and the
Subsidiary, a copy of: (1) the balance sheet, profit and loss statement, surplus
statement and any supporting schedules prepared in accordance with generally
accepted accounting principles consistently applied and signed by the presidents
and chief financial officers of the Borrower and the Subsidiary; and (2) all
financial statements, including, but not limited to, all call reports, filed
with any state or federal bank regulatory authority;
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(ii) as
soon
as practicable, and in no event later than one hundred twenty (120) days after
the end of each calendar year, a copy of: (1) the consolidated balance sheets
as
of the end of such year and of the consolidated profit and loss and surplus
statements for the Borrower and the Subsidiary for such year audited by
independent certified public accountants satisfactory to the Bank and
accompanied by an unqualified opinion; and (2) all financial statements and
reports, including, but not limited to call reports and annual reports, filed
annually with state or federal regulatory authorities;
(iii) as
soon
as practicable, and in no event later than forty-five (45) days after the end
of
each calendar quarter, copies of the then current loan/asset watch list, the
substandard loan/asset list, the nonperforming loan/asset list and other real
estate owned list of the Subsidiary;
(iv) immediately
after receiving knowledge thereof, notice in writing of all charges, assessment,
actions, suits and proceeding that are proposed or initiated by, or brought
before, any court or governmental department, commission, board or other
administrative agency, in connection with the Borrower or the Subsidiary, other
than ordinary course of business litigation not involving the FRS or the FDIC,
which, if adversely decided, would not have a material effect on the financial
condition or operations of the Borrower or the Subsidiary; and
(v) promptly
after the occurrence thereof, notice of any other matter which has resulted
in a
materially adverse change in the financial condition or operations of the
Borrower or the Subsidiary;
(b) contemporaneously
with the furnishing of a copy of each annual report and of each quarterly
statement provided pursuant to Section 7(a)(i) and (ii) above, deliver to Bank,
a certificate signed by the President and the Treasurer of the Borrower,
containing a computation of the then current financial ratios specified in
Subsections 7(c) through (g) of this Agreement, and stating that no Default
or
unmatured Default (meaning an event or condition the occurrence of which, with
the lapse of time, would become a a Default) has occurred or is continuing,
or,
if there is any such event, describing such event, the steps, if any, that
are
being taken to cure it, and the time within which such cure will
occur;
(c) maintain
such capital as is necessary to cause the Borrower to be well capitalzed in
accordance with the regulations of the FRS and any requirements or conditions
that the FRS has or may impose on the Borrower;
(d) maintain
such capital as is necessary to cause the Subsidiary to be classified as a
“well
capitalized” institution in accordance with the regulations of the FDIC,
currently measured on the basis of information filed by Subsidiary in its
quarterly Consolidated Report of Income and Condition (the “Call Report”) as
follows:
(i) Total
Capital to Risk-Weighted Assets of not less than 10%;
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(ii) Tier
1
Capital to Risk-Weighted Assets of not less than 6%; and
(iii) Tier
1
Capital to average Total Assets of not less than 5% (for the purposes of this
subsection (d)(iii) the average Total Assets shall be determined on the basis
of
information contain in the preceding four (4) Call Reports);
(e) cause
the
Subsidiary to maintain tangible equity capital of no less than $600,000,000.
For
the purposes of this Section 7(e), “tangible equity capital” shall mean the sum
of the common stock, surplus and retained earning accounts reduced by the amount
of any goodwill;
(f) cause
the
ratio of nonperforming loans to the primary capital of the Subsidiary to be
not
more than thirty percent (30%) at all times. For purposes of this Section 7(f),
“primary capital” shall mean the sum of the common stock, surplus and retained
earning accounts plus the reserve for loan and lease losses and “nonperforming
loans” shall mean the sum of all nonaccrual loans and loans on which any payment
is ninety (90) or more days past due, provided, however, 75% of the amount
of
any nonperforming loan secured by a first mortgage shall not be included when
calculating the amount of nonperforming loans;
(g) cause
the
sum of the: (i) allowance for loan loss reserves, and (ii) loss reserve for
unfunded commitments as a percentage of total loans of the Subsidiary to be
not
less than eighty-five hundredths of one percent (0.85%) at all
times;
(h) promptly
pay and discharge all taxes, assessments and other governmental charges imposed
upon the Borrower or the Subsidiary or upon the income, profits, or property
of
the Borrower or the Subsidiary and all claims for labor, material or supplies
which, if unpaid, might by law become a lien or charge upon the property of
the
Borrower or the Subsidiary. Neither the Borrower nor any Subsidiary shall be
required to pay any such tax, assessment, charge or claim, so long as the
validity thereof shall be contested in good faith by appropriate proceedings,
and reserves therefor shall be maintained on the books of the Borrower or the
Subsidiary as are deemed reasonably adequate by the Bank;
(i) maintain
bonds and insurance and cause the Subsidiary to maintain bonds and insurance
with responsible and reputable insurance companies or associations in such
amounts and covering such risk as is usually carried by owners of similar
businesses and properties in the same general area in which the Borrower or
the
Subsidiary respectively, operates, and such additional bonds and insurance
as
may be reasonably required by the Bank;
(j) permit
and cause the Subsidiary to permit the Bank through its employees, attorneys,
accountants or other agents, to inspect any of the properties, corporate books
and financial books and records of the Borrower and the Subsidiary at such
times
and as often as the Bank reasonably may request; and
(k) provide
and cause the Subsidiary promptly to provide the Bank with such other
information concerning the business, operations, financial condition and
regulatory status of the Borrower and the Subsidiary as the Bank may from time
to time reasonably request.
8. Collateral.
Pursuant
to the Pledge Agreement, the Borrower has assigned, transferred, pledged and
delivered to the Bank as collateral for all of the Borrower’s obligations from
time to time to the Bank the Subsidiary Shares and any other Pledged Security
(as defined in the Pledge Agreement) whether now or hereafter
pledged.
-11-
9. Events
of Default; Default; Rights Upon Default.
The
happening or occurrence of any of the following events or acts shall each
constitute a Default hereunder, and any such Default shall also constitute
a
Default under the Note, the Pledge Agreement and any other loan document,
without right to notice or time to cure in favor of the Borrower except as
indicated below:
(a) if
the
Borrower fails to make payment five (5) days after written notice thereof by
the
Bank or where applicable upon demand, or fails to make any payments as provided
for herein;
(b) if
there
continues to exist any breach under any obligation of any other documents
executed pursuant to this Agreement including, without limitation, the Note
and
the Pledge Agreement and such breach remains uncured beyond the applicable
time
period, if any, specifically provided therefor;
(c) if
any
representation or warranty made in this Agreement shall continue to be false
when made or at any time during the term of this Agreement or any extension
thereof, or if the Borrower fails to perform or observe any covenant or
agreement contained in this Agreement thirty (30) days after written notice
thereof by Bank;
(d) if
the
Borrower fails to perform or observe any covenant or agreement contained in
any
agreement other than this Agreement between the Borrower or the Subsidiary
and
the Bank, or if any condition contained in any agreement between the Borrower
or
the Subsidiary and the Bank is not fulfilled and such failure remains uncured
beyond the applicable time period, if any, specifically provided
therefor;
(e) if
there
is a change in control in the Borrower or Subsidiary (as defined under
applicable laws or regulations) or if Xxxxxx Xxxxxxxx ceases to be a member
of
senior management of the Borrower and Subsidiary;
(f) if
the
Borrower shall continue to fail to perform and observe, or cause or permit
the
Subsidiary to fail to perform and observe any covenants under this Agreement,
including, without limitation, all affirmative and negative covenants set forth
in Sections 6 and 7 of this Agreement thirty (30) days after written notice
thereof by the Bank;
(g) if
the
FRS, the FDIC or other governmental agency charged with the regulation of bank
holding companies or depository institutions: (i) issues to the Borrower or
the
Subsidiary, or initiates any action, suit or proceeding to obtain against,
impose on or require from the Borrower or the Subsidiary, a cease and desist
order or similar regulatory order, or (ii) a notice or finding under Section
8(a) of the Federal Deposit Insurance Act, or any similar enforcement action,
measure or proceeding;
-12-
(h) if
the
Subsidiary is notified that it is considered an institution in “troubled
condition” within the meaning of 12 U.S.C. Section 1831i and the regulations
promulgated thereunder, or if a conservator or receiver is appointed for any
Subsidiary;
(i) if
the
Borrower or the Subsidiary becomes insolvent or is unable to pay its debts
as
they mature; or makes an assignment for the benefit of creditors or admits
in
writing its inability to pay its debts as they mature; or suspends transaction
of its usual business, or if a trustee of any substantial part of the assets
of
the Borrower or the Subsidiary is applied for or appointed, and if appointed
in
a proceeding brought against the Borrower, the Borrower by any action or failure
to act indicates its approval of, consent to, or acquiescence in such
appointment, or within thirty (30) days such appointment is not vacated or
stayed on appeal or otherwise, or shall not otherwise have ceased to continue
in
effect;
(j) if
any
proceedings involving the Borrower or the Subsidiary are commenced by or against
the Borrower or the Subsidiary under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation law
or
statute of the federal government or any state government and if such
proceedings are instituted against the Borrower, the Borrower by any action
or
failure to act indicates its approval of, consent to our acquiescence therein,
or an order shall be entered approving the petition in such proceedings and
within thirty (30) days after the entry thereof such order is not vacated or
stayed on appeal or otherwise, or shall not otherwise have ceased to continue
in
effect; or
(k) if
the
Borrower or the Subsidiary continue to be in default in any payment of principal
or interest for any other obligation or in the performance of any other term,
condition or covenant contained in any agreement (including but not limited
to
an agreement in connection with the acquisition of capital equipment on a title
retention or net lease basis), under which any such obligation is created the
effect of which default is to cause or permit the holder of such obligation
to
cause such obligation to become due prior to its stated maturity.
Upon
the
occurrence of a Default, the Bank shall have all rights and remedies provided
by
applicable law and, without limiting the generality of the foregoing, may,
at
its option, declare its commitments to be terminated and the Note shall
thereupon be and become forthwith, due and payable, without any presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by the Borrower, anything contained herein or in the Note or the Pledge
Agreement to the contrary notwithstanding, and may, also without limitation,
appropriate and apply toward the payment of the Note any indebtedness of the
Bank to the Borrower however created or arising, and may, also without
limitation exercise any and all rights in and to the collateral security
referred to in Section 8 above and under the Pledge Agreement. There shall
be no
obligation to liquidate any collateral pledge hereunder in any order or with
any
priority or to exercise any remedy available to the Bank in any
order.
10. Miscellaneous.
(a) No
failure or delay on the part of the Bank in exercising any right, power or
remedy hereunder shall operate as a waiver thereof. No single or partial
exercise of any such right, power or remedy shall preclude any other or further
exercise thereof or the exercise of any other right, power or remedy hereunder.
The remedies herein provided are cumulative and not exclusive of any remedies
provided by law. Time is of the essence in the performance of the covenants,
agreements and obligations of the Borrower and the Subsidiary.
-13-
(b) This
Agreement constitutes the entire agreement between the parties and supersedes
all prior agreements between the Bank and the Borrower with respect to the
subject matter hereof. No amendment, modification, termination or waiver of
any
provision of this Agreement, the Pledge Agreement or the Note, or consent to
any
departure by the Borrower therefrom, shall be effective except for the specific
purpose for which given. No notice to or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances.
(c) All
notices, requests, demands and other communications provided for hereunder
shall
be: (i) in writing, (ii) made in one of the following manners, and (iii) shall
be deemed given (a) if and when personally delivered, (b) on the next business
day if sent by nationally recognized overnight courier addressed to the
appropriate party as set forth below, or (c) on the second business day after
being deposited in United States certified or registered mail, and addressed
as
follows:
| If to Borrower: | Corus Bankshares, Inc.
0000
Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxx 00000
Attention:
Xxxxxx X. Xxxxxxxx, President
|
|
with
a copy to:
|
Xxx
Xxxxxx, Chief Financial Officer
Corus
Bankshares, Inc.
0000
Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxx 00000
|
| If to the Bank: |
LaSalle Bank National Association
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxx 00000
Attention:
Xxxxxxx X. Xxxx
|
|
with
a copy to:
|
Xxxxxxxx
Xxxxxx, Chartered 180
X. XxXxxxx Xxxxxx Xxxxx
0000Xxxxxxx,
Xxxxxxxx 00000
Attn:
Xxxxxx X. Xxxxxxx, Esq.
|
or,
as to
each party, at such other address as shall be designated by such party in a
written notice to each other party complying as to delivery with the terms
of
this subsection.
(d) This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which taken together shall
constitute but one and the same instrument.
-14-
(e) This
Agreement shall become effective when it shall have been executed by the
Borrower and the Bank and thereafter shall be binding upon and inure to the
benefit of the Borrower and the Bank and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior consent of the Bank which
may
be given or denied in the Bank’s sole and absolute discretion.
(f) This
Agreement and the Note shall be governed by the internal laws of the State
of
Illinois, and for all purposes shall be construed in accordance with the laws
of
said State.
(g) Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or lack of enforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction; wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law.
(h) All
covenants, agreements, representations and warranties made by the Borrower
herein shall, notwithstanding any investigation by or knowledge on the part
of
the Bank, be deemed material and relied on by the Bank and shall survive the
execution and delivery to the Bank of this Agreement and the Note.
(i) This
Agreement shall govern the terms of any extensions or renewals to the Note,
subject to any additional terms and conditions imposed by the Bank in connection
with any such extension or renewal.
(j) The
Borrower hereby represents that the indebtedness evidenced hereby constitutes
a
loan made by Bank to enable the Borrower to carry on a commercial enterprise
for
the purpose of investment or profit; and that such loan is a loan for business
purposes under the intent and purview of 815 ILCS 205/4(c).
(k) The
Borrower will pay all reasonable costs and expenses (including, without
limitation, reasonable attorneys, fees) in connection with the preparation,
negotiations, documentation, execution, delivery, administration, amendment,
modification, collection and enforcement of this Agreement, the Note, the Pledge
Agreement and the other instruments and documents to be delivered hereunder.
In
addition, the Borrower shall pay, and save Bank harmless from any liability
for,
any and all stamp and other taxes determined to be payable in connection with
the execution and delivery of this Agreement, the borrowings hereunder, or
the
Note and the other instruments and documents to be delivered hereunder, and
agrees to save the Bank harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omitting to pay such taxes.
The foregoing obligations shall survive any termination of this Agreement,
the
Note of the Pledge Agreement. Any of the foregoing amounts incurred by Bank
and
not paid by the Borrower upon demand shall bear interest from the date incurred
at the Prime Rate plus two percent (2%) per annum and shall be deemed part
of
the indebtedness hereunder.
(l) Any
accounting term not specifically defined herein shall be construed in accordance
with generally accepted accounting principles which are applied in the
preparation of the financial statements referred to in Section 5(C), and all
financial data submitted pursuant to this Agreement shall be prepared in
accordance with such principles.
-15-
(m) The
Bank
reserves the right to sell participations in this loan or otherwise assign,
transfer or hypothecate all or any part of this loan.
(n) All
covenants, agreements, warranties, and representations of the Borrower herein
shall be deemed to have been made jointly and severally by the Borrower and
the
Subsidiary.
(o) The
Borrower agrees to do such further acts and things and to execute and deliver
to
Bank such additional assignments, agreements, powers and instruments, as Bank
may reasonably require or deem advisable to carry into effect the purpose of
this Agreement, the Note, the Pledge Agreement or any agreement or instrument
in
connection herewith, or to better assure and confirm unto Bank its rights,
powers and remedies hereunder or under such other loan documents.
(p) Upon
the
date of this Loan Agreement, the Original Loan Agreement (and, except as
otherwise set forth in the following proviso, all obligations and rights of
any
party thereunder), shall be amended and restated by this Loan Agreement;
provided, however, that the obligation to repay the loans and advances arising
under the Original Loan Agreement shall continue in full force and effect and
the liens and security interests securing payment thereof shall be continuing
but shall now be governed by the terms of this Loan Agreement, the Note and
the
Pledge Agreement. No action or inaction by Lender prior to the date of
this Agreement shall be deemed to have established a course of conduct between
the parties hereto. All rights and obligations of the Borrower and Bank
shall be solely as set forth in this Agreement, the Note and the Pledge
Agreement.
(remainder
of page left intentionally blank; signature page follows)
-16-
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as
of the date first above written.
|
CORUS
BANKSHARES, INC.
|
||
| |
|
|
| By: |
|
|
| Its: |
|
|
| LASALLE BANK NATIONAL ASSOCIATION | ||
| |
|
|
| By: |
|
|
| Its: |
|
|
-17-
Exhibit
A
REVOLVING
NOTE
| $150,000,000.00 |
Date:
February 28, 0000
|
Xx
February 28, 2010, for value received, CORUS BANKSHARES, INC., a Minnesota
corporation (the “Maker”), hereby promises to pay to the order of LASALLE BANK
NATIONAL ASSOCIATION (the “Payee”) the principal sum of ONE HUNDRED FIFTY
MILLION and 00/100 DOLLARS ($150,000,000.00), together with interest computed
on
the actual number of days elapsed on the basis of a 360 day year, on any and
all
principal amounts remaining unpaid hereunder from time to time outstanding
from
March 31, 2007 and continuing on the last day of each December, March, June
and
September thereafter. A final payment of outstanding principal and interest
will
be due and payable on February 28, 2010.
Any
amount of interest or principal hereof which is not paid when due, whether
at
stated maturity, by acceleration, or otherwise, shall bear interest payable
on
demand at an interest rate per annum equal at all times to two percent (2%)
above the interest rate on this Revolving Note.
All
payments hereunder shall be applied first to interest then due on the unpaid
principal balance at the rate herein specified and then to principal. All
payments of principal and interest on this Revolving Note shall be payable
in
lawful money of the United States of America.
Principal
and interest shall be paid to the Payee at its office at 000 Xxxxx XxXxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx, or at such other place as the holder of this Note
may
designate in writing to the Maker.
This
Revolving Note evidences indebtedness incurred under that certain Amended and
Restated Loan Agreement dated as of February 28, 2007 (as amended from time
to
time, the “Loan Agreement”) between the Maker and the Payee, to which reference
is hereby made. This Revolving Note is entitled to all of the benefits provided
in the Loan Agreement. The terms of the Loan Agreement are incorporated herein
by reference. This Revolving Note may be declared due as provided in the Loan
Agreement.
In
the
event of default, any indebtedness due from the holder may be set off and
applied against this Revolving Note, whether due or not. The Maker also agrees
to pay all costs of collection, including court costs and reasonable attorneys,
fees incurred by the holder.
This
Revolving Note replaces that certain Revolving Note in the original principal
amount of $100,000,000, dated November 25, 2005, and does not constitute payment
thereof or a novation therefor.
|
CORUS
BANKSHARES, INC.
|
||
| |
|
|
| By: |
|
|
| Its: |
|
|
-18-
