Exhibit 10.1
AMENDED AND RESTATED REVOLVING CREDIT
AND TERM LOAN AGREEMENT
This Amended and Restated Revolving Credit and Term Loan Agreement (the
"AGREEMENT") is made and entered into as of the 16th day of January, 1997 by
and between United Community Bancshares, Inc. (the "BORROWER") and Firstar
Bank Milwaukee, N.A. (the "BANK").
RECITALS
The Borrower and the Bank acknowledge the following:
A. The Borrower and the Bank entered into a Revolving Credit and
Term Loan Agreement dated as of January 3, 1994 (the "Original Agreement")
pursuant to which the Bank agreed to extend credit to the Borrower on the
terms and subject to the conditions set forth therein.
B. The Original Agreement has been previously amended several
times and the Bank and the Borrower now desire to amend and restate the
Original Agreement.
ARTICLE I. DEFINITIONS
1.1 DEFINITIONS. Except as otherwise provided, all accounting terms
will be construed in accordance with generally accepted accounting principles
applicable to banks consistently applied and consistent with those applied in
the preparation of the financial statements referred to in paragraph 4.13,
and financial data submitted pursuant to this Agreement will be prepared in
accordance with such principles. As used herein:
(a) "ASSETS" means the sum of all assets including Loan Loss
Reserves of the Subsidiary Banks determined in accordance with generally
accepted accounting principles applicable to banks, consistently applied.
(b) "LOAN LOSS RESERVES" means the loan loss reserves of the
Subsidiary Bank reported in the most recent call reports of the Subsidiary
Banks.
(c) "NONPERFORMING LOANS" means the sum of those loans 90 days or
more past due and those loans classified as "non-accrual" or "renegotiated"
as reported in the most recent call reports of the Subsidiary Banks.
(d) "OTHER REAL ESTATE" means the value of all real estate owned
by the Subsidiary Banks and classified as such by the examiners of the
Comptroller of the Currency, Federal Deposit Insurance Corporation, Federal
Reserve Board or appropriate state agency responsible for examining the
Subsidiary Banks, as shown on the most recent examination reports of the
Subsidiary Banks.
1
(e) "PRIMARY CAPITAL" means the sum of Total Tangible Equity and Loan
Loss Reserves.
(f) "SUBSIDIARY" OR "SUBSIDIARIES" means the Subsidiary Banks and
any entity of which the Borrower owns, directly or through another
Subsidiary, at the date of determination, more than 50% of the outstanding
stock having ordinary voting power for the election of directors,
irrespective of whether or not at such time stock of any other class or
classes might have voting power by reason of the happening of any contingency.
(g) "SUBSIDIARY BANKS" means Signal Bank, Inc. ("Signal Bank"),
The Xxxxxxx County National Bank ("Xxxxxxx Bank") and Park National Bank
("Park Bank") and "SUBSIDIARY BANK" means any of the foregoing.
(h) "TOTAL LOANS" means the aggregate outstanding principal amount
of all loans shown as assets of the Subsidiary Banks as reported in the most
recent call reports of the Subsidiary Banks.
(i) "TOTAL TANGIBLE EQUITY" means the total amount of capital
stock, surplus and undivided profits accounts, after adjustment for net
unrealized holding gains (losses) on available-for-sale securities of the
Subsidiary Banks, less intangibles, all of which will be determined in
accordance with generally accepted accounting principles applicable to banks,
consistently applied.
ARTICLE II. LOANS
2.1 LOANS.
(a) REVOLVING CREDIT FACILITY. From time to time prior to January
16, 1998 or the earlier termination hereof pursuant to Article VI, the
Borrower may borrow from the Bank, subject to the terms and conditions
contained herein, up to the aggregate principal amount outstanding at any one
time of up to $3,000,000. All revolving loans hereunder will be evidenced by
a single promissory note of the Borrower payable to the order of the Bank and
dated as of the date hereof (the "REVOLVING CREDIT NOTE"). Although the
Revolving Credit Note will be expressed to be payable in the maximum amount
set forth above, the Borrower will be obligated to pay only the amount of
loans actually disbursed hereunder, together with accrued interest on the
outstanding balance at the rates and on the dates specified therein and such
other charges provided for herein.
(b) TERM LOAN. As of the date hereof, the Bank agrees, subject to
the terms and conditions hereof, to make a term loan to the Borrower in an
amount up to $27,000,000. The term loan shall be evidenced by a single
promissory note of the Borrower payable to the order of the Bank and dated as
of the date hereof (the "TERM NOTE"). The principal balance of the Term Note
shall be payable, and bear interest in accordance with, the terms and
conditions of the Term Note.
2
2.2 SECURITY. The loans provided for hereunder will be secured by all
of the capital stock of the Subsidiary Banks, all of the capital stock of
Consumers Credit Corporation ("CCC") and all of the capital stock of Park
Financial Corporation ("PFC"), now owned or hereafter acquired by the
Borrower or any Subsidiary, except directors qualifying shares, if any.
2.3 MANDATORY PREPAYMENT. If R. Xxxxx Xxxxx and Xxxxx X. Xxxx cease
for any reason to be active in the management of the Borrowerfor a period of
30 consecutive days or more, exclusive of vacation or other approved leaves
of absence, and is not replaced by an individual of comparable ability and
experience, the Borrower will promptly give the Bank written notice thereof
and upon demand by the Bank, the Borrower will repay the loans made
hereunder, and any other loans from the Bank to the Borrower, on the date
specified in such demand.
ARTICLE III. CONDITIONS TO BORROWING
3.1 CONDITIONS TO BORROWING. The Bank will not be obligated to make
(or continue to make) advances hereunder unless (i) the Bank has received
executed copies of the Notes and all other documents or agreements applicable
to the loans described herein, including but not limited to the documents
specified in Article V (collectively with this Agreement the "LOAN
DOCUMENTS"), in form and content satisfactory to the Bank; (ii) the Bank has
received confirmation satisfactory to it that the Bank has a properly
perfected security interest with the proper priority in any collateral
securing advances hereunder; (iii) the Bank has received certified copies of
the Articles of Incorporation and By-Laws and a certificate of status of the
Borrower and the Subsidiaries; (iv) the Bank has received a certified copy of
a resolution or authorization in form and content satisfactory to the Bank
authorizing the loan and all acts contemplated by this Agreement and all
related documents, and confirmation of proper authorization of all guaranties
and other acts of third parties contemplated hereunder; (v) the Bank has been
provided with an opinion of the Borrower's counsel in form and content
satisfactory to the Bank confirming the matters outlined in paragraph 4.1 and
such other matters as the Bank requests; (vi) no default exists under this
Agreement or under any other Loan Documents, or under any other agreements by
and between the Borrower and the Bank and no condition or event will exist or
have occurred which with the passage of time, the giving of notice or both
would constitute a default under this Agreement or under any other Loan
Documents or under any other agreements by and between the Borrower and the
Bank; (vii) all proceedings taken in connection with the transactions
contemplated by this Agreement and all instruments, authorizations and other
documents applicable thereto, will be satisfactory to the Bank and its
counsel; (viii) the Bank has received evidence satisfactory to the Bank that
the Borrower has obtained all required regulatory approvals for the
acquisition by the Borrower of PFC and the Bank has received evidence
satisfactory to the Bank that except for the funding of the term loan
contemplated hereunder the Borrower has consummated the acquisition of PFC;
(ix) the Bank has received its original Letter of Credit No. s102182 dated
October 7, 1996, undrawn upon, in the face amount of $1,000,000 issued for
the account of the Borrower in favor of Park Financial Corporation; (x) the
Bank has received evidence satisfactory to the Bank that the Borrower has
raised $11,000,000 through the issuance and sale of Junior Subordinated
Deferrable
3
Interest Debentures substantially in accordance with the application
submitted to the Federal Reserve Bank of Minneapolis, copies of which were
previously provided to the Bank; and (xi) the Bank has received evidence
satisfactory to the Bank that the Borrower has raised $4,998,960 through the
issuance and sale of common stock.
ARTICLE IV. WARRANTIES AND COVENANTS
During the term of this Agreement, and while any part of the credit
granted the Borrower is available or any obligations under any of the Loan
Documents are unpaid or outstanding, the Borrower warrants and agrees as
follows:
4.1 ORGANIZATION AND AUTHORITY. The Borrower is a validly existing
corporation in good standing under the laws of its state of organization, and
has all requisite power and authority, corporate or otherwise, and possesses
all licenses necessary, to conduct its business and own its properties. The
execution, delivery and performance of this Agreement and the other Loan
Documents (i) are within the Borrower's power; (ii) have been duly authorized
by proper corporate action; (iii) do not require the approval of any
governmental agency; and (iv) will not violate any law, agreement or
restriction by which the Borrower is bound. This Agreement and the other
Loan Documents are the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with their terms.
4.2 SUBSIDIARIES.
(a) Signal Bank has issued and outstanding 4,355 shares of common
stock, par value $100 per share, which are duly authorized, validly issued,
fully paid and non-assessable, of which the Borrower owns 4,355 shares, which
represent 100% of the issued and outstanding capital stock of Signal Bank,
free and clear of any liens, charges, encumbrances, rights of redemption,
preemptive rights or rights of first refusal of any kind or nature
whatsoever, except liens in favor of the Bank. Signal Bank has no shares of
capital stock (common or preferred), or securities or other obligations
convertible into any of the foregoing, authorized or outstanding and has no
outstanding offers, subscriptions, warrants, rights or other agreements or
commitments obligating Signal Bank to issue or sell any of the foregoing.
(b) Xxxxxxx Bank has issued and outstanding 14,981 shares of
common stock, par value $50 per share, which are duly authorized, validly
issued, fully paid and non-assessable, of which the Borrower owns 14,981
shares, which represent 100% of the issued and outstanding capital stock of
Xxxxxxx Bank, free and clear of any liens, charges, encumbrances, rights of
redemption, preemptive rights or rights of first refusal of any kind or
nature whatsoever, except liens in favor of the Bank. Xxxxxxx Bank has no
shares of capital stock (common or preferred), or securities or other
obligations convertible into any of the foregoing, authorized or outstanding
and has no outstanding offers, subscriptions, warrants, rights or other
agreements or commitments obligating Xxxxxxx Bank to issue or sell any of the
foregoing.
4
(c) CCC has issued and outstanding 100,000 shares of common stock,
par value $1 per share, which are duly authorized, validly issued, fully paid
and non-assessable, of which the Borrower owns 100,000 shares, which
represent 100% of the issued and outstanding capital stock of CCC, free and
clear of any liens, charges, encumbrances, rights of redemption, preemptive
rights or rights of first refusal of any kind or nature whatsoever, except
liens in favor of the Bank. CCC has no shares of capital stock (common or
preferred), or securities or other obligations convertible into any of the
foregoing, authorized or outstanding and has no outstanding offers,
subscriptions, warrants, rights or other agreements or commitments obligating
CCC to issue or sell any of the foregoing.
(d) INTENTIONALLY OMITTED.
(e) PFC has issued and outstanding 100,000 shares of common stock,
par value $1 per share, which are duly authorized, validly issued, fully paid
and non-assessable, of which the Borrower owns 100,000 shares, which
represents 100% of the issued and outstanding capital stock of PFC, free and
clear of any liens, charges, encumbrances, rights of redemption, preemptive
rights or rights of first refusal of any kind or nature whatsoever, except
liens in favor of the Bank. PFC has no shares of capital stock (common or
preferred), or securities or other obligations convertible into any of the
foregoing, authorized or outstanding and has no outstanding offers,
subscriptions, warrants, rights or other agreements or commitments obligating
PFC issue or sell any of the foregoing.
(f) Park Bank has issued and outstanding 130,000 shares of common
stock, par value $5 per share, which are duly authorized, validly issued,
fully paid and non-assessable, of which PFC owns 130,000 shares, which
represent 100% of the issued and outstanding capital stock of Park Bank, free
and clear of any liens, charges, encumbrances, rights of redemption,
preemptive rights or rights of first refusal of any kind or nature
whatsoever, except liens in favor of the Bank. Park Bank has no shares of
capital stock (common or preferred), or securities or other obligations
convertible into any of the foregoing, authorized or outstanding and has no
outstanding offers, subscriptions, warrants, rights or other agreements or
commitments obligating Park Bank issue or sell any of the foregoing.
(g) Unitech Services, Inc. has issued and outstanding 1,000 shares
of common stock, par value $.01 per share, which are duly authorized, validly
issued, fully paid and non-assessable, of which the Borrower owns 1,000
shares, which represent 100% of the issued and outstanding capital stock of
Unitech Services, Inc., free and clear of any liens, charges, encumbrances,
rights of redemption, preemptive rights or rights of first refusal of any
kind or nature whatsoever, except liens in favor of the Bank. Unitech
Services, Inc. has no shares of capital stock (common or preferred), or
securities or other obligations convertible into any of the foregoing,
authorized or outstanding and has no outstanding offers, subscriptions,
warrants, rights or other agreements or commitments obligating Unitech
Services, Inc. issue or sell any of the foregoing.
(h) The Borrower also has an additional wholly-owned subsidiary
named, United Capital Trust I, a Delaware business trust. The Borrower's
ownership interest in
5
United Capital Trust I is free and clear of any liens, charges and
encumbrances of any kind or nature whatsoever.
4.3 LITIGATION AND COMPLIANCE WITH LAWS. The Borrower and the
Subsidiaries have complied in all material respects with and will continue to
comply with all applicable federal and state laws and regulations: (i) that
regulate or are concerned in any way with its or their banking and trust
business, including without limitation those laws and regulations relating to
the investment of funds, lending of money, collection of interest, extension
of credit, and location and operation of banking facilities; or (ii)
otherwise relate to or affect the business or assets of the Borrower or any
of the Subsidiaries or the assets owned, used or occupied by them. Except to
the extent previously disclosed to the Bank, there are no claims, actions,
suits, or proceedings pending, or to the best knowledge of the Borrower,
threatened or contemplated against or affecting the Borrower or any of the
Subsidiaries, at law or in equity, or before any federal, state or other
governmental authority, or before any arbitrator or arbitration panel,
whether by contract or otherwise, and there is no decree, judgment or order
of any kind in existence against or restraining the Borrower or any of the
Subsidiaries, or any of their officers, employees or directors, from taking
any action of any kind in connection with the business of the Borrower or any
of the Subsidiaries. Except to the extent previously disclosed to the Bank,
neither the Borrower nor any of the Subsidiaries has (i) received from any
regulatory authority any criticisms, recommendations or suggestions of a
material nature, and the Borrower has no reason to believe that any such is
contemplated, concerning the capital structure of any of the Subsidiaries,
loan policies or portfolio, or other banking and business practices of any of
the Subsidiaries that have not been resolved to the satisfaction of such
regulatory authorities or (ii) entered into any memorandum of understanding
or similar arrangement with any federal or state regulator relating to any
unsound or unsafe banking practice or conduct or any violation of law
respecting the operations of the Borrower or the operations of any of the
Subsidiaries.
4.4 F.D.I.C. INSURANCE. Each Subsidiary Bank is insured as to deposits
by the Federal Deposit Insurance Corporation and no act has occurred which
could adversely affect the status of any Subsidiary Bank as an insured bank.
4.5 CORPORATE EXISTENCE; BUSINESS ACTIVITIES; ASSETS. The Borrower
will and will cause each Subsidiary to (i) preserve its corporate existence,
rights and franchises; (ii) carry on its business activities in substantially
the manner such activities are conducted as of the date of this Agreement;
(iii) not liquidate, dissolve, merge or consolidate with or into another
entity; and (iv) not sell, lease, transfer or otherwise dispose of all or
substantially all of its assets. Notwithstanding the foregoing, any
Subsidiary may merge or consolidate with the Borrower or any other Subsidiary
(except Unitech Services, Inc. or United Capital Trust I), provided that in
the case of a merger or consolidation with the Borrower, the surviving entity
must be the Borrower; and any Subsidiary may sell, lease or transfer all or
substantially all of its assets to the Borrower or any other Subsidiary
(except Unitech Services, Inc. or United Capital Trust I).
4.6 USE OF PROCEEDS; MARGIN STOCK; SPECULATION. Advances by the Bank
under the Revolving Credit Note will be used exclusively by the Borrower to
refinance its existing
6
revolving credit facilities with the Bank and for working capital purposes.
Advances by the Bank under the Term Note will be used exclusively by the
Borrower to refinance its existing term loan obligations with the Bank and to
acquire the capital stock of Park Financial Corporation. The Borrower will
not use any of the loan proceeds to purchase or carry "margin" stock (as
defined in Regulation U of the Board of Governors of the Federal Reserve
System). No part of any of the proceeds will be used for speculative
investment purposes, including, without limitation, speculating or hedging in
the commodities and/or futures market.
4.7 ENVIRONMENTAL MATTERS. Except as disclosed in a written schedule
attached to this Agreement (if no schedule is attached, there are no
exceptions), there exists no uncorrected violation by the Borrower of any
federal, state or local laws (including statutes, regulations, ordinances or
other governmental restrictions and requirements) relating to the discharge
of air pollutants, water pollutants or process waste water or otherwise
relating to the environment or Hazardous Substances as hereinafter defined,
whether such laws currently exist or are enacted in the future (collectively
"ENVIRONMENTAL LAWS"). The term "HAZARDOUS SUBSTANCES" will mean any
hazardous or toxic wastes, chemicals or other substances, the generation,
possession or existence of which is prohibited or governed by any
Environmental Laws. The Borrower is not subject to any judgment, decree,
order or citation, or a party to (or threatened with) any litigation or
administrative proceeding, which asserts that the Borrower (i) has violated
any Environmental Laws; (ii) is required to clean up, remove or take remedial
or other action with respect to any Hazardous Substances (collectively
"REMEDIAL ACTION"); or (iii) is required to pay all or a portion of the cost
of any Remedial Action, as a potentially responsible party. Except as
disclosed on the Borrower's environmental questionnaire provided to the Bank,
there are not now, nor to the Borrower's knowledge after reasonable
investigation have there ever been, any Hazardous Substances (or tanks or
other facilities for the storage of Hazardous Substances) stored, deposited,
recycled or disposed of on, under or at any real estate owned or occupied by
the Borrower during the periods that the Borrower owned or occupied such real
estate, which if present on the real estate or in soils or ground water,
could require Remedial Action. To the Borrower's knowledge, there are no
proposed or pending changes in Environmental Laws which would adversely
affect the Borrower or its business, and there are no conditions existing
currently or likely to exist while the Loan Documents are in effect which
would subject the Borrower to Remedial Action or other liability. The
Borrower currently complies with and will continue to timely comply with all
applicable Environmental Laws; and will provide the Bank, immediately upon
receipt, copies of any correspondence, notice, complaint, order or other
document from any source asserting or alleging any circumstance or condition
which requires or may require a financial contribution by the Borrower or
Remedial Action or other response by or on the part of the Borrower under
Environmental Laws, or which seeks damages or civil, criminal or punitive
penalties from the Borrower for an alleged violation of Environmental Laws.
4.8 RESTRICTION ON INDEBTEDNESS. The Borrower will not and will not
permit any of the Subsidiaries to create, incur, assume or have outstanding
any indebtedness for borrowed money (including capitalized leases) except (i)
indebtedness under the Notes issued under this Agreement; (ii) other
indebtedness to the Bank; (iii) indebtedness of the Subsidiary
7
Banks to the Federal Home Loan Bank; (iv) indebtedness of CCC owing to any
Subsidiary Bank; (v) obligations of any Subsidiary Bank under customer
repurchase agreements; (vi) any other indebtedness outstanding on the date
hereof, and shown on the Borrower's or the Subsidiary Banks' financial
statements delivered to the Bank prior to the date hereof, provided such
other indebtedness shall not be renewed, extended or increased; (vii) fed
funds purchased, or commercial paper issued, in the ordinary course of
business by Subsidiaries in an aggregate amount not to exceed $20,000,000 at
any time outstanding; and (viii) indebtedness evidenced by the Junior
Subordinated Deferrable Interest Debentures issued by the Borrower under the
Subordinated Indenture (as defined in section 4.19 hereof).
4.9 RESTRICTION ON LIENS. The Borrower will not and will not permit
any Subsidiary to create, incur, assume or permit to exist any mortgage,
pledge, encumbrance or other lien or levy upon or security interest in any of
the Borrower's property now owned or hereafter acquired, except (i) taxes and
assessments which are either not delinquent or which are being contested in
good faith with adequate reserves provided; (ii) easements, restrictions and
minor title irregularities which do not, as a practical matter, have an
adverse effect upon the ownership and use of the affected property; (iii)
liens in favor of the Bank; (iv) liens arising in connection with customer
repurchase agreements and (v) other liens disclosed in writing to the Bank
prior to the date hereof which are fully subordinated to any security
interest or other lien held by the Bank.
4.10 RESTRICTION ON CONTINGENT LIABILITIES. The Borrower will not and
will not permit any of the Subsidiaries to guarantee or become a surety or
otherwise contingently liable for any obligations of others, except pursuant
to the deposit and collection of checks, the issuance or confirmation of
letters of credit by the Subsidiary Banks, the guaranty of United Capital
Trust I's obligations with respect to the Trust Securities to be issued under
that certain Amended and Restated Trust Agreement to be entered into among
the Borrower, Wilmington Trust Company, as Property Trustee, Wilmington Trust
Company, as Delaware Trustee and the Administrative Trustees named therein
and party thereto and similar matters in the ordinary course of banking
business.
4.11 INSURANCE. The Borrower will maintain and cause each Subsidiary to
maintain insurance to such extent, covering such risks and with such insurers
as is usual and customary for businesses operating similar properties, and as
is satisfactory to the Bank, including insurance for fire and other risks
insured against by extended coverage, public liability insurance and workers'
compensation insurance.
4.12 TAXES AND OTHER LIABILITIES. The Borrower will pay and discharge,
and cause each Subsidiary to pay and discharge when due, all of its taxes,
assessments and other liabilities, except when the payment thereof is being
contested in good faith by appropriate procedures which will avoid
foreclosure of liens securing such items, and with adequate reserves provided
therefor.
4.13 FINANCIAL STATEMENTS AND REPORTING. The financial statements and
other information previously provided to the Bank or provided to the Bank in
the future are or will be complete and accurate and prepared in accordance
with generally accepted accounting
8
principles. There has been no material adverse change in the Borrower's
financial condition since such information was provided to the Bank. The
Borrower will, and will cause each Subsidiary to (i) maintain accounting
records in accordance with generally recognized and accepted principles of
accounting consistently applied throughout the accounting periods involved;
(ii) provide the Bank with such information concerning its business affairs
and financial condition (including insurance coverage) as the Bank may
reasonably request; and (iii) without request, provide the Bank with the
following information:
(a) As soon as available, and in any event within 90 days after
the end of each fiscal year of the Borrower, the Borrower's annual audited
financial statements prepared by an accounting firm acceptable to the Bank;
and
(b) Within 45 days of the end of each quarter, quarterly call
reports prepared on FFIEC forms, or any successors thereto, of each
Subsidiary Bank prepared in accordance with the guidelines of the regulatory
agency which regulates such Subsidiary Bank to the extent the Borrower is
able to do so under bank regulatory rules and guidelines; and
(c) As soon as available, copies of all reports or materials
submitted or distributed to shareholders of the Borrower or filed with the
SEC or other governmental agency having regulatory authority over the
Borrower or any Subsidiary or with any national securities exchange to the
extent the Borrower is able to do so under bank regulatory rules and
guidelines; and
(d) Promptly after the furnishing thereof, copies of any statement
or report furnished to any other holder of obligations of the Borrower or any
Subsidiary pursuant to the terms of any indenture, loan or similar agreement
and not otherwise required to be furnished to the Bank pursuant to any other
clause of this paragraph 4.13 to the extent the Borrower is able to do so
under bank regulatory rules and guidelines; and
(e) Promptly, and in any event within 10 days, after the Borrower
has knowledge thereof, a statement of the chief financial officer of the
Borrower describing: (i) any event which, either of itself or with the lapse
of time or the giving of notice or both, would constitute a default hereunder
or under any other material agreement to which the Borrower or any Subsidiary
is a party, together with a statement of the actions which the Borrower
proposes to take with respect thereto; and (ii) any pending or threatened
litigation or administrative proceeding of the type described in paragraph
4.3; and
(f) Notice of any memorandum of understanding or any other
agreement with any banking regulatory agencies, or cease and desist order,
immediately after entered into by or issued against Borrower or any
Subsidiary to the extent the Borrower is able to do so under bank regulatory
rules and guidelines; and
(g) Promptly after request therefor, any other information concerning
the business affairs and financial condition of the Borrower or any Subsidiary
as the Bank may
9
reasonably request to the extent the Borrower is able to do so under bank
regulatory rules and guidelines.
4.14 INFORMATION. The Borrower will make available for review by the
Bank, promptly upon the Bank's request, financial statements, call reports
and any other records or documents of the Borrower or any Subsidiary Bank.
The Borrower and the Subsidiaries will use best efforts to obtain the consent
of any person or regulator which it deems necessary or appropriate for
disclosure of the information described above.
4.15 FINANCIAL COVENANTS. The Borrower will cause each Subsidiary Bank
to maintain as of the end of each fiscal quarter for such Subsidiary Bank:
(a) a ratio of Primary Capital to Assets of at least 7.0%;
(b) a ratio of Nonperforming Loans plus Other Real Estate to Total
Loans plus Other Real Estate of not greater than 3.0%;
(c) a ratio of Nonperforming Loans plus Other Real Estate to
Primary Capital of not greater than 24.0%;
(d) an average return on Assets of at least .75% for Signal Bank
and Xxxxxxx Bank and an average return on Assets of at least .45% for Park
Bank; provided, however, that the failure by any Subsidiary Bank to maintain
the required average return on Assets as of the end of any fiscal quarter
will not constitute an event of default under paragraph 6.1 if such
Subsidiary Bank maintains the required average return on Assets as of the end
of the immediately succeeding fiscal quarter as reported on such Subsidiary
Bank's quarterly call report; and
(e) a ratio of Loan Loss Reserves to Nonperforming Loans of at
least 100%.
4.16 ACCESS TO RECORDS. The Borrower will permit representatives of the
Bank to visit and inspect any of the properties and examine any books and
records of the Borrower and the Subsidiaries including without limitation the
stock transfer records of each Subsidiary Bank, at any reasonable time and as
often as the Bank may reasonably desire.
4.17 ISSUANCE OF STOCK. The Borrower will not permit any Subsidiary to
issue any additional shares of common or preferred stock, or any options,
warrants or other common stock equivalents, or sell or issue securities or
obligations convertible into such ("NEW STOCK"), whether in the form of stock
dividends or stock splits or otherwise, unless such New Stock will be issued
to the Borrower and delivered by the Borrower to the Bank, together with any
additional documents required by the Bank, as additional collateral to secure
the loan provided for hereunder, except for the securities to be issued by
United Capital Trust I pursuant to the plans as described in the prospectus
previously delivered to the Bank.
10
4.18 DIVIDENDS. The Borrower will not pay any dividends or make any
other distribution on account of any shares of any class of its stock or
redeem, purchase or otherwise acquire, directly or indirectly any shares of
its stock unless and until the occurrence of each of the following: (i) the
Borrower maintains Total Tangible Equity in an amount greater than 5% of
Assets; and (ii) the Borrower is retiring the Term Notes substantially in
accordance with the financial projections submitted to the Federal Reserve
Bank of Minneapolis, copies of which were previously provided to the Bank.
4.19 SUBORDINATED DEBENTURES. The Borrower shall not make, nor shall
any Subsidiary retain, any payment on account of the principal of, or
interest on, any Junior Subordinated Deferrable Interest Debenture in
violation of that certain Subordinated Indenture to be entered into between
the Borrower and Wilmington Trust Company, as trustee (the "SUBORDINATED
INDENTURE"), nor shall the Borrower or any Subsidiary amend, supplement or
modify the Subordinated Indenture without the prior written consent of the
Bank, which consent shall not be unreasonably withheld.
ARTICLE V. COLLATERAL
5.1 COLLATERAL. This Agreement and the Notes will be secured by an
Amended and Restated Collateral Pledge Agreement of the Borrower , a
Collateral Pledge Agreement of PFC and a Guaranty Agreement of PFC. The
information in this Article V is for information only and the omission of any
reference to an agreement will not affect the validity or enforceability
thereof. The rights and remedies of the Bank outlined in this Agreement and
the documents identified above are intended to be cumulative.
5.2 CREDIT BALANCES; SETOFF. As additional security for the payment of
the obligations described in the Loan Documents and any other obligations of
the Borrower to the Bank of any nature whatsoever (collectively the
"OBLIGATIONS"), the Borrower hereby grants to the Bank a security interest
in, a lien on and an express contractual right to set off against all
depository account balances, cash and any other property of the Borrower now
or hereafter in the possession of the Bank. The Bank may, at any time upon
the occurrence of a default hereunder (notwithstanding any notice
requirements or grace/cure periods under this or other agreements between the
Borrower and the Bank) set off against the Obligations WHETHER OR NOT THE
OBLIGATIONS (INCLUDING FUTURE INSTALLMENTS) ARE THEN DUE OR HAVE BEEN
ACCELERATED, ALL WITHOUT ANY ADVANCE OR CONTEMPORANEOUS NOTICE OR DEMAND OF
ANY KIND TO THE BORROWER, SUCH NOTICE AND DEMAND BEING EXPRESSLY WAIVED.
ARTICLE VI. DEFAULTS
6.1 DEFAULTS. NOTWITHSTANDING ANY CURE PERIODS DESCRIBED BELOW, THE
BORROWER WILL IMMEDIATELY NOTIFY THE BANK IN WRITING WHEN THE BORROWER
OBTAINS KNOWLEDGE OF THE OCCURRENCE OF ANY DEFAULT SPECIFIED BELOW.
Regardless of whether the Borrower has given the required notice, the
occurrence of one or more of the following will constitute a default:
11
(a) NONPAYMENT. The Borrower fails to pay (i) any interest due on
the Notes or any fees, charges, costs or expenses under the Loan Documents by
5 days after the same becomes due; or (ii) any principal amount of the Notes
when due.
(b) NONPERFORMANCE. The Borrower or any guarantor of Borrower's
Obligations to the Bank ("GUARANTOR") fails to perform or observe any
agreement, term, provision, condition, or covenant (other than a default
occurring under (a), (c), (d), (e), (f) or (g) of this paragraph 6.1)
required to be performed or observed by the Borrower or any Guarantor
hereunder or under any other Loan Document or other agreement with or in
favor of the Bank.
(c) MISREPRESENTATION. Any financial information, statement,
certificate, representation or warranty given to the Bank by the Borrower or
any Guarantor (or any of their representatives) in connection with entering
into this Agreement or the other Loan Documents and/or any borrowing
thereunder, or required to be furnished under the terms thereof, proves
untrue or misleading in any material respect (as determined by the Bank in
the exercise of its judgment) as of the time when given.
(d) DEFAULT ON OTHER OBLIGATIONS. The Borrower, any Guarantor or
any Subsidiary will be in default under the terms of any loan agreement,
promissory notes, lease, conditional sale contract or other agreement,
document or instrument evidencing, governing or securing any indebtedness
owing by the Borrower, any Guarantor or any Subsidiary to the Bank, or the
Borrower shall be in default under any indebtedness in excess of $100,000
owing by the Borrower to any third party, and the period of grace, if any, to
cure said default shall have passed.
(e) JUDGMENTS. Any judgment is obtained against the Borrower, any
Guarantor or any Subsidiary which, together with all other outstanding
unsatisfied judgments against the Borrower (or such Guarantor or Subsidiary),
exceeds the sum of $100,000 and remains unvacated, unbonded or unstayed for a
period of 30 days following the date of entry thereof.
(f) INABILITY TO PERFORM; BANKRUPTCY/INSOLVENCY. (i) the
Borrower, any Guarantor or any Subsidiary ceases to exist (except as
otherwise permitted herein); or (ii) any Guarantor attempts to revoke any
guaranty of the Obligations described herein, or any guaranty becomes
unenforceable in whole or in part for any reason; or (iii) any bankruptcy,
insolvency or receivership proceedings, or an assignment for the benefit of
creditors, is commenced under any Federal or state law by or against the
Borrower, any Guarantor or any Subsidiary; or (iv) the Borrower, any
Guarantor or any Subsidiary becomes the subject of any out-of-court
settlement with its creditors; or (v) the Borrower, any Guarantor or any
Subsidiary is unable or admits in writing its inability to pay its debts as
they mature; or (vi) the Borrower or any Subsidiary is closed or taken over
by a banking regulatory agency.
(g) ADVERSE CHANGE. There is a material adverse change in the
business, properties, financial condition or affairs of the Borrower, any
Guarantor or any Subsidiary, or in any collateral securing the Obligations.
12
(h) REGULATORY ORDERS. The Borrower or any Subsidiary enters into
any memorandum of understanding or other agreement with any banking
regulatory agency relating to any unsound or unsafe banking practice or
conduct or any violation of law respecting the operation of Borrower or such
Subsidiary; or Borrower or any Subsidiary or any of their senior officers or
directors become the subject of a judicial or administrative determination
restraining any of them from taking any actions of any kind in connection
with the business of Borrower or such Subsidiary, assessing a civil penalty,
finding that any criminal offense occurred in connection with the operations
of Borrower or such Subsidiary, or suspending or removing any officer or
director of Borrower or such Subsidiary.
6.2 TERMINATION OF LOAN; ADDITIONAL BANK RIGHTS. Upon the occurrence
and during the continuance of any of the events identified in paragraph 6.1,
the Bank may at any time (notwithstanding any notice requirements or
grace/cure periods under this or other agreements between the Borrower and
the Bank) (i) immediately terminate its obligation, if any, to make
additional loans to the Borrower; (ii) set off; and/or (iii) take such other
steps to protect or preserve the Bank's interest in any collateral, including
without limitation, notifying account debtors to make payments directly to
the Bank, advancing funds to protect any collateral and insuring collateral
at the Borrower's expense; all without demand or notice of any kind, all of
which are hereby waived.
6.3 ACCELERATION OF OBLIGATIONS. Upon the occurrence and during the
continuance of any of the events identified in paragraphs 6.1(a) through
6.1(e) and 6.1(g) and 6.1(h), and the passage of any applicable cure periods,
the Bank may at any time thereafter, (i) by written notice to the Borrower,
declare the unpaid principal balance of any Obligations, together with the
interest accrued thereon and other amounts accrued hereunder and under the
other Loan Documents, to be immediately due and payable; and the unpaid
balance will thereupon be due and payable, all without presentation, demand,
protest or further notice of any kind, all of which are hereby waived, and
notwithstanding anything to the contrary contained herein or in any of the
other Loan Documents; and (ii) require the Borrower to cause any Subsidiary
to appoint an independent transfer agent for the purpose of registering and
transferring ownership of the capital stock of such Subsidiary. Upon the
occurrence of any event under paragraph 6.1(f), the unpaid principal balance
of any Obligations, together with all interest accrued thereon and other
amounts accrued hereunder and under the other Loan Documents, will thereupon
be immediately due and payable, all without presentation, demand, protest or
notice of any kind, all of which are hereby waived, and notwithstanding
anything to the contrary contained herein or in any of the other Loan
Documents. NOTHING CONTAINED IN PARAGRAPH 6.1, PARAGRAPH 6.2 OR THIS SECTION
WILL LIMIT THE BANK'S RIGHT TO SET OFF AS PROVIDED IN PARAGRAPH 5.2 OR
OTHERWISE IN THIS AGREEMENT.
6.4 OTHER REMEDIES. Nothing in this Article VI is intended to restrict
the Bank's rights under any of the Loan Documents or at law, and the Bank may
exercise all such rights and remedies as and when they are available.
13
ARTICLE VII. MISCELLANEOUS
7.1 DELAY; CUMULATIVE REMEDIES. No delay on the part of the Bank in
exercising any right, power or privilege hereunder or under any of the other
Loan Documents will operate as a waiver thereof, nor will any single or
partial exercise of any right, power or privilege hereunder preclude other or
further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein specified are cumulative and are
not exclusive of any rights or remedies which the Bank would otherwise have.
7.2 RELATIONSHIP TO OTHER DOCUMENTS. The warranties, covenants and
other obligations of the Borrower (and the rights and remedies of the Bank)
that are outlined in this Agreement and the other Loan Documents are intended
to supplement each other. In the event of any inconsistencies in any of the
terms in the Loan Documents, all terms will be cumulative so as to give the
Bank the most favorable rights set forth in the conflicting documents, except
that if there is a direct conflict between any preprinted terms and
specifically negotiated terms (whether included in an addendum or otherwise),
the specifically negotiated terms will control.
7.3 PARTICIPATIONS; GUARANTORS. The Bank may, at its option, sell all
or any interests in the Notes and other Loan Documents to other financial
institutions. Any purchaser of an interest in the Notes is hereinafter
referred to as a "Participant." In connection with such sales (and
thereafter), the Bank may disclose any financial information the Bank may
have concerning the Borrower to any such Participant or potential
Participant. From time to time, the Bank may, in its discretion and without
obligation to the Borrower, any guarantor or any other third party, disclose
information about the Borrower and this Agreement to any guarantor, surety or
other accommodation party. This provision does not obligate the Bank to
supply any information or release the Borrower from its obligation to provide
such information, and the Borrower agrees to keep all Guarantors advised of
its financial condition and other matters which may be relevant to the
Guarantors' obligations to the Bank.
7.4 EXPENSES AND ATTORNEYS' FEES. The Borrower will reimburse the Bank
for all attorneys' fees and all other costs, fees and out-of-pocket
disbursements (including fees and disbursements of both inside counsel and
outside counsel) incurred by the Bank in connection with the preparation,
execution, delivery, administration, defense and enforcement of this
Agreement or any of the other Loan Documents, including fees and costs
related to any waivers or amendments with respect thereto (examples of costs
and fees include but are not limited to fees and costs for: filing,
perfecting or confirming the priority of the Bank's lien, title searches or
insurance, appraisals, environmental audits and other reviews related to the
Borrower, any collateral or the loans, if requested by the Bank). The
Borrower will also reimburse the Bank for all costs of collection before and
after judgment, and the costs of preservation and/or liquidation of any
collateral (including fees and disbursements of both inside and outside
counsel).
7.5 SUCCESSORS. The rights, options, powers and remedies granted in
this Agreement and the other Loan Documents will extend to the Bank and to
its successors and assigns, will be binding upon the Borrower and its
successors and assigns and will be applicable hereto and to all renewals
and/or extensions hereof.
14
7.6 INDEMNIFICATION. Except for harm arising from the Bank's gross
negligence or willful misconduct, the Borrower hereby indemnifies and agrees
to defend and hold the Bank harmless from any and all losses, costs, damages,
claims and expenses of any kind suffered by or asserted against the Bank
relating to claims by third parties arising out of the financing provided
under the Loan Documents or related to any collateral. This indemnification
and hold harmless provision will survive the termination of the Loan
Documents and the satisfaction of the Obligations due the Bank.
7.7 NOTICE OF CLAIMS AGAINST BANK; LIMITATION OF CERTAIN DAMAGES. In
order to allow the Bank to mitigate any damages to the Borrower from the
Bank's alleged breach of its duties under the Loan Documents or any other
duty, if any, to the Borrower, the Borrower agrees to give the Bank immediate
written notice of any claim or defense it has against the Bank, whether in
tort or contract, relating to any action or inaction by the Bank under the
Loan Documents, or the transactions related thereto, or of any defense to
payment of the Obligations for any reason. The requirement of providing
timely notice to the Bank represents the parties' agreed-to standard of
performance regarding claims against the Bank. Notwithstanding any claim
that the Borrower may have against the Bank, and regardless of any notice the
Borrower may have given the Bank, THE BANK WILL NOT BE LIABLE TO THE BORROWER
FOR CONSEQUENTIAL AND/OR SPECIAL DAMAGES ARISING THEREFROM, EXCEPT THOSE
DAMAGES ARISING FROM THE BANK'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
7.8 NOTICES. Although any notice required to be given hereunder or
under any of the other Loan Documents might be accomplished by other means,
notice will always be deemed given when placed in the United States Mail,
with postage prepaid, or sent by overnight delivery service, or sent by telex
or facsimile, in each case to the address set forth below or as amended.
7.9 PAYMENTS. Payments due under the Notes and other Loan Documents
will be made in lawful money of the United States, and the Bank is authorized
to charge payments due under the Loan Documents against any account of the
Borrower. All payments may be applied by the Bank to principal, interest and
other amounts due under the Loan Documents in any order which the Bank elects.
7.10 APPLICABLE LAW AND JURISDICTION; INTERPRETATION; JOINT LIABILITY.
This Agreement and all other Loan Documents will be governed by and
interpreted in accordance with the internal laws of the state where the
Bank's main office is located, except to the extent superseded by Federal
law. Invalidity of any provisions of this Agreement will not affect any
other provision. THE BORROWER HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION
OF ANY STATE OR FEDERAL COURT SITUATED IN THE COUNTY OR FEDERAL JURISDICTION
WHERE THE BANK'S OFFICE WHICH IS DESIGNATED IN THE NOTES AS THE PLACE FOR
PAYMENT IS LOCATED (OR, IN THE ABSENCE OF SUCH DESIGNATION, THE BANK'S MAIN
OFFICE), AND WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS, WITH REGARD
TO ANY ACTIONS, CLAIMS, DISPUTES OR PROCEEDINGS RELATING TO THIS AGREEMENT,
THE NOTES, THE COLLATERAL, ANY OTHER LOAN DOCUMENT, OR ANY TRANSACTIONS
ARISING THEREFROM, OR ENFORCEMENT AND/OR
15
INTERPRETATION OF ANY OF THE FOREGOING. Nothing herein will affect the
Bank's rights to serve process in any manner permitted by law, or limit the
Bank's right to bring proceedings against the Borrower in the competent
courts of any other jurisdiction or jurisdictions. This Agreement, the other
Loan Documents and any amendments hereto (regardless of when executed) will
be deemed effective and accepted only upon the Bank's receipt of the executed
originals thereof. If there is more than one Borrower, the liability of the
Borrowers will be joint and several, and the reference to "Borrower" will be
deemed to refer to all Borrowers.
7.11 COPIES; ENTIRE AGREEMENT; MODIFICATION. The Borrower hereby
acknowledges the receipt of a copy of this Agreement and all other Loan
Documents.
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER
TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY
ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN
AGREEMENT. THIS NOTICE SHALL ALSO BE EFFECTIVE WITH RESPECT TO ALL OTHER
CREDIT AGREEMENTS NOW IN EFFECT BETWEEN YOU AND THIS LENDER. A MODIFICATION
OF ANY OTHER CREDIT AGREEMENTS NOW IN EFFECT BETWEEN YOU AND THIS LENDER,
WHICH OCCURS AFTER RECEIPT BY YOU OF THIS NOTICE, MAY BE MADE ONLY BY ANOTHER
WRITTEN INSTRUMENT. ORAL OR IMPLIED MODIFICATIONS TO SUCH CREDIT AGREEMENTS
ARE NOT ENFORCEABLE AND SHOULD NOT BE RELIED UPON.
7.12 WAIVER OF JURY TRIAL. THE BORROWER AND THE BANK HEREBY JOINTLY AND
SEVERALLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING RELATING TO ANY OF THE LOAN DOCUMENTS, THE OBLIGATIONS THEREUNDER,
ANY COLLATERAL SECURING THE OBLIGATIONS, OR ANY TRANSACTION ARISING THEREFROM
OR CONNECTED THERETO. THE BORROWER AND THE BANK EACH REPRESENTS TO THE OTHER
THAT THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY GIVEN.
16
IN WITNESS WHEREOF, the undersigned have executed this AMENDED AND RESTATED
REVOLVING CREDIT AND TERM LOAN AGREEMENT as of January 16, 1997.
Address: 0000 Xxxxx Xxxxx XXXXXX XXXXXXXXX
Xxxxx 000 BANCSHARES, INC.
Xxxxx, XX 00000
By (s) R. Xxxxx Xxxxx
--------------------------------
Its Chairman
-------------------------------
By (s) Xxxxx X. Xxxx
--------------------------------
Its President
-------------------------------
Address: 000 Xxxx 0xx Xxxxxx FIRSTAR BANK MILWAUKEE,
0xx Xxxxx X.X.
Xx. Xxxx, XX 00000
By (s) Xxxxxxx X. Xxxxxxxxxxx
--------------------------------
Its Vice President
-------------------------------
17
