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EXHIBIT 10.8
TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT ("Agreement") is made and entered into as of the
21st day of August, 1997, by and between TEAM FINANCIAL, INC., f/k/a TeamBanc,
Inc., a Kansas corporation ("Company") and COMMERCE BANK, N.A., a national
banking association ("Bank");
In consideration of the mutual benefits accruing to each of the parties,
the receipt and sufficiency of which is hereby acknowledged, and in further
consideration of the mutual performance of this Agreement, the parties hereto
agree as follows:
ARTICLE I
Definitions
1.01. Code. The Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder. It is understood that any reference to
the Bank's federal income tax means the Bank or any entity that files a
consolidated federal income tax return with Bank.
1.02. Prime Rate. The per annum rate of interest established from
time to time by Bank for its own internal convenience as its "Prime Rate",
which when used to compute the rate of interest hereunder shall change as
of the date of any change in said Prime Rate; no representation is made
that the Prime Rate is the best, lowest or favored rate of interest.
ARTICLE II
Term Loan
2.01. Amount. Subject to the terms of this Agreement, Bank agrees to
lend to Company the sum of $247,000 (the "Term Loan").
2.02. Term Note. On the Closing Date (hereinafter defined) Company
will execute and deliver its promissory note to Bank, in the principal
amount of $247,000, and in form and substance acceptable to Bank (the
"Term Note").
2.03. Interest. The Term Note will bear interest at a variable per
annum rate equal to one percent (1%) less than the Prime Rate. Accrued
interest shall be calculated on the actual number of days outstanding
based on a year consisting of 365 days, and shall be payable quarterly, in
arrears, commencing December 31, 1997, and continuing on the last day of
each March, June, September
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and December thereafter, until and including the due date of the Term
Note. Interest after or during the continuation of any Event of Default
under Section 7.01, shall be at a rate equal to three percent (311) in
excess of the Prime Rate.
2.04. Repayment. The principal of the Term Note shall be payable in
annual installments of $35,285.71 commencing December 31, 1998, and
continuing on the last day of each December thereafter, until December 31,
2004, when the outstanding principal balance, together with accrued
interest, shall be due and payable in full.
2.05. Prepayment. Company may prepay the Term Note in full or in part
at any time without the payment of a prepayment fee. Any partial
prepayments shall be applied to the annual principal payments in the
inverse order of their maturities.
2.06. Purpose. Proceeds of the Term Loan shall be used to fund a loan
by Company to the trustee (the "Trustee") of the TeamBanc, Inc. Employees
Stock Ownership Plan (the "Trust"), as established pursuant to the
TeamBanc, Inc. Employees Stock Ownership Plan dated as of November 6,
1992, as amended from time to time (the "Plan"), pursuant to the agreement
between the Bank, the Company and the Trustee (the "Lending Agreement")
and evidenced by a promissory note (the "ESOP Note") made by the Trustee
to Company.
ARTICLE III
Representations and Warranties
In borrowing hereunder the Company represents and warrants to Bank which
representations and warranties will survive the delivery of the Term Note and
shall continue so long as any sums remain outstanding under the Term Note or
under this Agreement) that:
3.01. Authorization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Kansas and is duly qualified as a foreign corporation and is in good
standing in every other jurisdiction where failure to be so qualified and
in good standing would have a material adverse effect on its business; the
Company has all requisite corporate power and authority to own and operate
its properties and to carry on its business as presently being conducted;
the Company has the power to enter into and to carry out the terms of this
Agreement and to execute, deliver and perform its obligations under this
Agreement, the Term Note, and any other instrument referred to
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or mentioned herein, and said performance by the Company of its
obligations has been duly authorized by appropriate corporate proceedings,
will not contravene any provisions of law, its Articles of Incorporation,
Bylaws, or any indenture, agreement or other instrument binding upon the
Company, and does not require the consent, approval or authorization of
any governmental agency or third party, except as otherwise specifically
provided herein.
3.02. Financial Condition. Except as provided in Schedule 3.02
attached hereto, the financial statements of Company dated as of December
31, 1996, copies of which have been furnished to Bank, are complete and
correct and fairly and accurately present the financial condition of
Company as at such date and the results of the operations of Company for
the period covered by such statements, all in accordance with generally
accepted accounting principles consistently applied, and there has been no
material adverse change in the condition (financial or otherwise),
business or operations of Company subsequent thereto.
3.03. Taxes. The Company has filed all required federal, state and
local tax returns and has paid all taxes as shown on said returns to be
due including interest and penalties, or has provided adequate reserves
for the payment thereof. No tax claims have been asserted against Company
which remain unpaid or for which an adequate reserve has not been
established.
3.04. Litigation. Other than as set forth in Schedule 3.04 attached
hereto, or as disclosed to Bank in writing prior to the date hereof, the
Company has no actions, suits or proceedings pending or, to its knowledge,
threatened against or affecting it or its properties before any court or
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which, if determined adverse to the
Company, might have a material adverse effect on its financial condition,
properties or operations.
3.05. Liability. Except as set forth in Schedule 3.05 attached
hereto, the Company has no liabilities, direct or contingent, except those
disclosed in the financial statements described in Section 3.02 hereof,
and those incurred since December 31, 1996 in the ordinary course of the
Company's business which have been disclosed in writing to Bank. Company
is not presently in default, and no event which, but for the lapse of time
or service of notice or both, would constitute a default has occurred and
is continuing under any agreement, indenture, mortgage, security agreement
or other instrument under which the Company is directly or contingently
liable or pursuant to which any of the assets or
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properties of Company or any shares of its outstanding capital stock is
encumbered or affected in any way. All stock of the Company has been
validly issued and is fully paid and nonassessable.
3.06. Properties. Company has good, valid and marketable title to all
of its properties shown as assets on its balance sheet. All properties are
free and clear of all liens, mortgages, security interests or other
encumbrances except those which have been disclosed to Bank in writing or
disclosed on its balance sheet.
3.07. Guaranties. Company has no guaranties outstanding, except those
which have been disclosed to Bank in writing.
3.08. Other Agreements. Company is not a party to, subject to, or
bound by any contract, agreement, instrument, charter or corporate
restriction which materially adversely affects its ability to perform its
obligations under this Agreement, the Term Note or other documents or
instruments provided for herein.
3.09. Margin Stock. Company is not engaged in the business of
extending credit for the purpose of carrying margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System. If requested by Bank, Company will furnish to Bank a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to
in Regulation U to the foregoing effect.
3.10. Use of Proceeds. The proceeds of the Term Loan shall be loaned
by Company to the Trustee of the Trust within the meaning of Section
4975(d)(3) of the Code for the acquisition of "employer securities"
(within the meaning of Section 409(l) of the Code), for the repayment of
the Term Loan or for the repayment of a prior loan to the Trustee of the
Trust, the proceeds of which were used by the Trust to acquire "employer
securities", and the terms and conditions of such loan by the Company to
the Trustee of the Trust shall comply with all laws and regulations in
respect thereto, including, to the extent applicable, but not limited to,
Regulation G of the Federal Reserve Board, the Code, the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), and
regulations promulgated thereunder.
3.11. Plan Qualifications. The Plan is qualified under Section 401(a)
of the Code, the Trust is exempt from tax under Section 501(a) of the
Code, and the consummation of the
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transactions under this Agreement and the Lending Agreement will not
constitute a prohibited transaction.
3.12. Stock. Except as set forth in Schedule 3.12 attached hereto,
there are no outstanding stock warrants, options, convertible securities
or other agreements that could cause additional stock to be issued or
sold.
3.13. Guarantor. The Guarantor (hereinafter defined) has authority,
and has completed all proceedings and obtained all approvals and consents
necessary, to execute, deliver and perform its obligations under the
Guaranty (hereinafter defined). The Guaranty when executed by the
Guarantor and delivered to Bank, shall constitute the legal, valid and
binding obligations of the Guarantor, enforceable in accordance with its
terms, except as limited by bankruptcy, insolvency, reorganization or
similar laws affecting the enforcement of creditors' rights generally. The
execution, delivery and performance by the Guarantor of the Guaranty will
not violate any provision of any existing mortgage, indenture, contract or
agreement binding on Guarantor or affecting any of its properties, and
will not result in, or require, the creation or imposition of any lien on
any of its properties or revenues. No litigation, investigation or
proceeding of or before any arbitrator or governmental authority is
pending or threatened by or against the Guarantor or any of its properties
or revenues with respect to the Guaranty, or any of the transactions
contemplated hereby or thereby or which could have a material adverse
effect on the business, operations, assets or financial or other condition
of the Guarantor.
ARTICLE IV
Affirmative Covenants
The Company covenants and agrees that during the term of this Agreement
and until all of the principal amount of and interest due under the Term
Note shall have been paid in full, unless otherwise agreed to by Bank in
advance and in writing to the contrary, the Company will duly perform and
observe each and all of the covenants and agreements hereinafter set
forth:
4.01. Maintenance and Compliance with Laws. The Company will maintain
its corporate existence, rights and franchises and comply with all
applicable statutes, regulations and orders of, and all applicable
restrictions imposed by, all government bodies, and maintain and keep its
properties in good repair, working order and operating condition.
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4.02. Financial Statements. Company will deliver to Bank the
following financial information of Company, Guarantor (hereinafter
defined) and Banks (hereinafter defined):
(a)Within sixty (60) days after the end of each fiscal quarter of
Company and Guarantor, the respective balance sheets, profit and loss
statements and net worth reconciliations of Company and Guarantor for such
accounting period, and the results of operations since the beginning of
the fiscal year, prepared in accordance with generally accepted principles
of accounting applied on a basis consistent with that of the financial
statements for the preceding fiscal year and certified by the chief
financial officer or chief executive officer of Company and Guarantor,
respectively, as truly reflecting the respective financial positions of
Company and Guarantor as of the end of the accounting period;
(b)Within ninety (90) days after the end of each fiscal year of
Company and Guarantor, the respective annual audited financial statements
of Company and Guarantor, prepared by independent certified public
accountants selected by Company and satisfactory to Bank in conformity
with generally accepted accounting principles applied on a basis
consistent with that of the financial statements for the preceding fiscal
year; and
(c)From time to time such further information regarding the financial
condition or business of Company, Guarantor and Banks as Bank may
reasonably request.
4.03. Inspection of Operations. Company shall permit such persons
designated by Bank to visit and inspect Company's properties, operations,
corporate books and financial records and to discuss Company's affairs,
finances and accounts with Company's principal officers and independent
public accountants, as may be requested from time to time by Bank.
4.04. Insurance. Company shall maintain, at all times, such insurance
covering such risks as is customary for companies of similar character, in
amounts and with companies acceptable to Bank.
4.05. Payment of Indebtedness. Company shall pay or discharge all
indebtedness heretofore or hereafter incurred as the same shall become due
and payable and shall faithfully perform, observe and discharge all
covenants, conditions and obligations which are imposed on it by any and
all indentures and other agreements securing or evidencing such
indebtedness or pursuant to which such indebtedness is issued.
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4.06. Taxes and Other Liens. The Company will pay and discharge
promptly all taxes, assessments, and other governmental charges or levies
imposed upon it or upon its income or upon any of its property, real,
personal or mixed, or upon any part thereof, as well as all claims of any
kind (including claims for labor, materials and supplies) which, if
unpaid, might by law become a lien or charge upon any of its property;
except any taxes, assessments or levies being contested in good faith by
appropriate legal proceedings and against which, if requested by the Bank,
the Company will set up reserves satisfactory to the Bank.
4.07. Notice of Defaults. Company shall notify Bank in writing of any
Event of Default (hereinafter defined) hereunder or of any fact,
condition, or event that, only with the giving of notice or passage of
time or both, would become an Event of Default. Company shall notify Bank
in writing of any default under any other indenture, agreement, contract
or other instrument to which Company is a party and of any acceleration of
the maturity of any material indebtedness of Company which default or
acceleration could have a material adverse effect on Company, and Company
shall take all necessary steps to remedy promptly any such default, to
protect against any such adverse claim, to defend any such proceeding and
to resolve all such controversies.
4.08. Data to Verify Compliance. Company shall promptly provide Bank
with such data as Bank shall reasonably request to verify the truth of all
warranties and representations and Company's compliance with all
covenants.
4.09. Contributions. Company will make contributions to the Trust
sufficient for the Trust to pay principal and accrued interest on the ESOP
Note in accordance with the schedule of payments set forth therein (such
contributions to be referred to herein as "Scheduled Contributions"). In
addition to the foregoing, and provided that no Event of Default
(hereinafter defined) has occurred or will occur, Company may make
contributions to the Trust in amounts adequate to provide cash to, or to
make other payments necessary in connection with, terminating participants
(such contributions to be referred to herein as "Permitted
Contributions"). If Company makes contributions in an amount in excess of
Scheduled Contributions (and Permitted Contributions, if applicable)
("Excess Contributions"), Company shall cause the Plan Administrator (as
set forth in the Plan) to direct the Trustee to use such Excess
Contributions to prepay the ESOP Note.
4.10. Securities Restrictions. Company shall comply with all
restrictions regarding securities acquired with loan proceeds
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imposed by the Internal Revenue Code and United States Treasury
Regulations, including, without limitation, restrictions concerning
subjection of the securities to a put, call or other option or buy-sell or
similar arrangement.
4.11. Notification. Company shall notify Bank promptly of any
governmental or judicial action or proceeding that relates directly or
indirectly to the qualification of the Plan under Sections 401(a) or
4975(e)(7) of the Code, or the participation of the Trust in the
transactions contemplated hereunder.
ARTICLE V
Negative Covenants
Without the prior written consent of Bank, during the term of this
Agreement or until all indebtedness of the Company to Bank has been paid,
whichever occurs last, Company covenants and agrees as follows:
5.01. Liens. Company will not create, incur, assume or suffer to
exist any security interest, mortgage, pledge, lien or other encumbrance
upon any of the Company's properties or assets, whether now owned or
hereafter acquired, except for those granted to Bank and except such
purchase money security interests created or granted by Company in the
ordinary course of its business, consistent with current practices, and
except such liens of taxes not in default or being contested in good
faith.
5.02. Fundamental Changes. Company will not amend its Articles of
Incorporation or Bylaws; wind up, liquidate, or dissolve itself;
reorganize, merge or consolidate with or into, or sell, transfer, convey
or lease all or any part of its property, to another person or entity;
sell or assign any accounts receivable; purchase or otherwise acquire all
or substantially all of the assets of any corporation, partnership, or
other entity, or any shares or similar interest in any other corporate
entity; or make any material change in the executive management of the
Company.
5.03. Conduct of Business. Company will not materially alter the
character in which Company conducts its business or the location of such
business or the nature of such business conducted at the date hereof.
5.04. Funded Indebtedness. Company shall not incur additional Funded
Indebtedness (direct, indirect, contingent or otherwise) unless such
Funded Indebtedness is subordinated (in writing and in form and substance
satisfactory to Bank) in all
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respects to the indebtedness of Company to Bank hereunder. For purposes of
this Agreement, "Funded Indebtedness" shall mean all indebtedness of
Company for borrowed money in excess of $250,000 (individually or in the
aggregate) and which has a maturity of one (1) or more years from the date
of origin, plus all Capitalized Leases (defined as any lease which is
required to be capitalized on the balance sheet of Company) and all
guarantees of such Funded Indebtedness of others, but excluding the
indebtedness incurred by Company in the ordinary course of business which
includes (i) deposits, (ii) Banker's Acceptances, (iii) repurchase
agreements, (iv) purchases of Federal Funds, and M Federal Reserve or
Federal Home Loan Bank borrowings made in the ordinary course of business,
and pledges, liens or encumbrances required to secure such indebtedness,
provided that Company shall have received Bank's prior written approval
of, and with respect to, the specific assets, or general class of assets,
to be pledged or encumbered by such pledges, liens or encumbrances.
5.05. Issuance of Additional Capital Stock. Company will not issue
any additional capital stock or securities convertible into capital stock
or any warrants or rights to purchase capital stock.
5.06. Investments. Company will not acquire for investment purposes,
investments that would not qualify as "customary and prudent investments",
consistent with the current investment practices of Company.
5.07. Loans to Affiliates, Shareholders and the Trust. Company will
not directly or indirectly loan amounts to any affiliate or shareholder of
Company, or to any entity controlled by such an affiliate or shareholder,
or to the Trust (whether or not for the purchase of additional employer
securities).
5.08. Debt Payments to Shareholders. Except with respect to
unsubordinated debt permitted under Section 5.04 (b) above, Company will
not directly or indirectly make any payments with respect to any
indebtedness owing to any shareholders.
5.09. Dividends. Except to the extent consistent with past practices,
Company will not pay any cash dividends to shareholders of Company.
5.10. Capital Expenditures. Company will not make any capital
expenditures other than those capital expenditures made in the ordinary
course of business, consistent with past Company practices.
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5.11. Plan Amendments. No amendments will be made to the Plan without
the prior written consent of Bank, which consent shall not be unreasonably
withheld.
ARTICLE VI
Collateral
The obligations and indebtedness of the Company to Bank hereunder or under
any other instrument shall be secured and supported by the following
("Collateral"):
6.01. ESOP Note and Stock. Company shall pledge and endorse to Bank
the ESOP Note and any stock of Company from time to time pledged as
security to the ESOP Note. Such pledge shall be evidenced by a Collateral
Assignment in form and substance acceptable to Bank.
6.02. Bank Stock. Company shall pledge all stock, whether common or
preferred, of Iola Bank and Trust ("Iola Bank"), First National Bank &
Trust Co. (Parsons, Kansas) ("FNB") and TeamBank, N.A. (Paola, Kansas)
("TeamBank") (said Iola Bank, FNB and TeamBank, together with TeamBank
Nebraska (hereinafter identified], to be sometimes hereinafter
collectively referred to as the "Banks") now owned or hereafter acquired
(together with the stock of TeamBank Nebraska (hereinafter identified] the
"Bank Stock"), which as of the date hereof is as follows:
Banks Type # of Shares Ownership Percentage
----- ---- ----------- --------------------
Xxxx Bank Common 70,000 100.000%
FNB Common 18,000 100.000%
TeamBank Common 100,000 100.00%
Company shall also pledge to Bank all of the outstanding stock, whether common
or preferred, of Team Financial Acquisition Subsidiary, Inc. ("Guarantor").
Such pledges shall be evidenced by a "Collateral Pledge Agreement", in form and
substance acceptable to Bank, together with stock powers relating thereto.
6.03. Guaranty. There shall be delivered to Bank, as additional
support for the obligations and indebtedness of Company to Bank (as well
as all other obligations owing by Company to Bank, now existing and
hereafter arising), the unconditional, unlimited corporate guarantee of
Guarantor. The guaranty shall be evidenced
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by a Corporate Guaranty in form and substance acceptable to Bank
("Guaranty"). Guarantor shall pledge all stock, whether common or
preferred, of TeamBank Nebraska (Bellevue, Nebraska) ("TeamBank Nebraska")
now owned or hereafter acquired, which as of the date hereof is as
follows:
Banks Type # of Shares Ownership Percentage
----- ---- ----------- --------------------
TeamBank Nebraska Common 8,000 100.00%
Such pledge shall be evidenced by a "Collateral Pledge Agreement", in form and
substance acceptable to Bank, together with stock powers relating thereto.
6.04. Other Documents. Company agrees to furnish such information and
to execute such other documents or undertake any other acts as may be
reasonably necessary to perfect and maintain the security interests
contemplated by this Agreement, or as otherwise reasonably requested by
Bank from time to time.
ARTICLE VII
Defaults
7.01. Events of-Default. The occurrence of one or more of the
following events ("Events of Default" or "Default") shall constitute a
Default by the Company hereunder:
(a) nonpayment of interest or principal hereunder when payment is due
as herein provided; or
(b) any representation or warranty made by the Company or Guarantor
herein or in any writing furnished in connection with or pursuant to this
Agreement shall prove to be false in any material respect as of the date
on which it is made; or
(c) a breach by Company in the performance or observance of any
agreement, term, covenant or condition contained herein (other than in (a)
above), and such breach shall not have been remedied within thirty (30)
days after written notice thereof shall have been given by Bank to
Company; or
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(d) any report, certificate, financial statement or other instrument
furnished in connection with this Agreement shall prove to be false or
misleading in any material respect; or
(e) default in the performance of the obligations of the Company or
Guarantor on any other note, agreement (including but not limited to
security agreements), or obligations owed by the Company or Guarantor to
Bank, which default results in the acceleration of such obligation; or
(f) any default by the Company or Guarantor under any other contract
for borrowed money which entitles the obligee to accelerate the maturity
thereof, or any failure by the Company or Guarantor to pay any
indebtedness when due, whether by acceleration or otherwise; or
(g) commencement by the Company or Guarantor of a voluntary case
under the Bankruptcy Act or similar law, federal or state, whether now or
hereafter existing; or a trustee or receiver shall be appointed for
Company or Guarantor or all or a substantial part of its properties in any
involuntary proceeding, or any court shall have taken any jurisdiction of
all or a substantial part of the properties of the Company or Guarantor in
any involuntary proceeding for the reorganization, dissolution,
liquidation or winding up of the business of the Company or Guarantor and
such trustee or receiver shall not be discharged or such jurisdiction
relinquished or vacated or stayed on appeal or otherwise within thirty
(30) days; or the Company or Guarantor shall file a petition or answer
consenting to or acquiescing in a petition against it in bankruptcy or
under any chapter of the Bankruptcy Act or any similar law, state or
federal, whether now or hereafter existing, or such petition filed against
the Company or Guarantor shall be approved and not vacated or stayed
within thirty (30) days; or the Company or Guarantor shall become
insolvent, or shall make an assignment for the benefit of creditors or
shall admit in writing its inability to pay its debts generally as they
become due, or shall consent to the appointment of a receiver or trustee
or liquidator of all its properties or a substantial part thereof, or
shall have failed within thirty (30) days to pay a bond or otherwise
discharge any judgment or attachment which is not stayed on appeal or
otherwise being contested in good faith; or
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(h) Company or Guarantor suffers any judgment, writ of attachment or
execution or similar process to be issued or levied against all or a
substantial part of its property and which is not released, stayed, bonded
or vacated within thirty (30) days; or
(i) The occurrence of a non-exempt "Prohibited Transaction", as
defined in Section 406 of ERISA or in Section 4975 of the Internal Revenue
Code, between the Plan and any other person or entity; or
(j) The failure of the Trust to maintain its status as a "tax exempt
trust" under Section 501 of the Internal Revenue Code, or the failure of
the Plan to maintain its status as a qualified plan under Section 401 or
as an employee stock ownership plan under Section 4975 of the Code.
7.02. Remedies. Upon an Event of Default, Bank may accelerate the
maturity of the Term Loan, with or without notice, and Bank may resort to
any and all security and to any remedy existing at law or in equity for
the collection of the Term Note according to its tenor and enforcement of
the covenants and provisions hereof, and the Bank's resort to any remedy
shall not prevent the concurrent or subsequent employment of any other
remedy. In addition to the remedies provided herein, in the event the Term
Note is due and payable or upon an Event of Default, the Bank shall have
the right of setoff, without demand or notice to anyone, against the funds
of the Company on deposit with it.
Notwithstanding anything contained herein to the contrary, Bank shall have
no right of setoff or any claims to any shares of the common stock of
Company which Bank may be holding as custodian on behalf of the Trust or
any funds of the Trust deposited with Bank except such shares as are
pledged to secure the ESOP Note, but only to the extent permitted by law.
7.03. Expenses of Collection. All costs, expenses and liabilities
incurred by Bank in collecting or attempting to collect on the Term Note,
including costs and expenses incurred in proposing or selling or otherwise
deriving upon any security, and all reasonable attorneys' fees in
connection with such matters, shall constitute a demand obligation of the
Company and shall bear interest from the date of expenditure until paid at
the per annum rate of three percent (3%) in excess of the Prime Rate.
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7.04. Waiver. Any waiver of an Event of Default by Bank shall not
extend to or affect any subsequent Event of Default. No failure or delay
by Bank in exercising any right hereunder shall operate as a waiver, nor
shall any single or partial exercise of any right preclude the exercise of
any other right hereunder.
ARTICLE VIII
Closing; Conditions Precedent
8.01. Closing. "Closing" shall take place at Bank's principal offices
at 0000 Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx on August 21, 1997 (the
"Closing Date").
8.02. Conditions Precedent to Closing. As a condition precedent to
Closing, Company shall have delivered to Bank the following documents:
(a) This Agreement and the Term Note, duly executed by the Company;
(b) The Collateral Assignment, duly executed by the Company;
(c) A fully executed copy of the Lending Agreement;
(d) The Collateral Pledge Agreement, duly executed by the Company,
together with the applicable Bank Stock, and Stock Powers (executed in
blank);
(e) The Guaranty, duly executed by the Guarantor, together with the
applicable Collateral Pledge Agreement, the applicable Bank Stock, and
Stock Powers (executed in blank);
(f) Fully executed copies of all other documents required under this
Agreement and any of the other documents executed in connection herewith,
including, without limitation, the Collateral Assignment;
(g) Certified copies of the Bylaws of the Company and Guarantor, and
of each resolution of the Company's and Guarantor's respective Boards of
Directors duly authorizing the execution and delivery of the applicable
loan documents and the Company's and Guarantor's performance hereunder and
thereunder;
(h) Certificates of Good Standing, dated not more than thirty (30)
days prior to the date of this Agreement, for the Company from the Kansas
Secretary of State, and the Guarantor from
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the Nebraska Secretary of State, and, if specifically requested by Bank,
from the Secretary of State for each other jurisdiction where the nature
of Company's or Guarantor's respective businesses requires it to be
qualified as a foreign corporation;
(i) An opinion of counsel for Company dated the Closing Date, in form
and substance satisfactory to Bank, substantially to the effect that W
Company is a corporation duly organized and existing and in good standing
under the laws of the State of Kansas; (ii) Company has adequate corporate
power and authority to enter into and perform this Agreement and the Term
Note; (iii) that this Agreement, the Term Note, the Collateral Assignment
and the Collateral Pledge Agreement have been duly authorized, executed
and delivered by Company and are legal, valid and binding instruments
enforceable against the Company in accordance with their respective terms,
except as may be limited by laws of receivership, insolvency and
bankruptcy; (iv) that the Plan complies with all federal and state laws
and regulations, including, without limitation, the Code and ERISA, and
regulations promulgated thereunder; and (v) the Plan is qualified under
Section 401(a) of the Code, the Trust is exempt from tax under Section
501(a) of the Code, and the consummation of the transactions under this
Agreement and the Lending Agreement will not constitute a prohibited
transaction; and
(j) Any other documents, instruments and reports as Bank shall
reasonably request.
Company shall be solely responsible for all costs incurred by it and/or Bank in
connection with satisfying any of the foregoing requirements.
ARTICLE IX
Miscellaneous
9.01. Payment on Holidays. Whenever any payment to be made pursuant
to this Agreement or the Term Note shall be stated to be due on a public
holiday, Saturday or Sunday, such payment may be made on the next
succeeding business day and such extension of time shall in such case be
included in computing interest, if any, in connection with such payment.
9.02. Waivers. No omission or delay by the Bank in exercising any
right, power or privilege under this Agreement, the Term Note or any other
documents executed in connection herewith, will impair such right, power
or privilege or be construed to be a waiver of any Event of Default or
acquiescence therein and any single or partial exercise of any right,
power or privilege will
10.8-15
16
not preclude other or further exercise of any other right, power or
privilege and no waiver will be valid unless in writing and signed by Bank
and then only to the extent specified. All remedies herein by law afforded
will be cumulative and will be available to Bank until all indebtedness of
Company is paid.
9.03. Binding Effect. This Agreement shall continue until payment in
full of all indebtedness owing hereunder and shall be binding upon Company
and its successors and assigns and shall be binding upon and inure to the
benefit of Bank, its successors and assigns.
9.04. Notices. Any notice, request, authorization, approval or
consent made hereunder shall be in writing and shall be personally
delivered or sent by registered or certified mail, and shall be deemed
given when delivered or postmarked and mailed postage prepaid to the
following addresses:
IF TO BANK: Commerce Bank, N.A.
0000 Xxxxxx Xxxxxx
P.O. Box 419248
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Attn: Xxxx Xxxxx
IF TO COMPANY: Team Financial, Inc.
Xxx Xxxxx Xxxxx
X.X. Xxx 000
Xxxxx, Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxxx
Bank and Company may designate a change of address by notice given in
accordance with the provisions of this Subsection at least five (5) days before
such change is to become effective.
9.05. Amendments. The Company and Bank may from time to enter into
written agreements supplemental hereto for the purpose of modifying or
adding any provision to this Agreement or changing the rights and
privileges of Bank or Company hereunder. Any such supplemental agreement
shall be binding upon the Company and the Bank and their respective
successors and assigns.
9.06. Headings. Article and Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute
a part of this Agreement for any other purpose.
10.8-16
17
9.07. Severability of Provisions. 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
enforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provisions in any other
jurisdiction.
9.08. Governing Law. This Agreement and all related documents will be
governed by, and construed in accordance with, the laws of the State of
Missouri.
9.09. Counterpart Agreements. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original and all
of which together shall constitute one and the same agreement.
9.10. Statutory Notice. ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY,
EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING
PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT YOU
(BORROWER) AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY
AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING,
WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US,
EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.
BY SIGNING BELOW, YOU AND WE AGREE THAT THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN US.
THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
10.8-17
18
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers on the day and year first above written.
TEAM FINANCIAL, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: President
---------------------
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Title: Chairman & CEO
---------------------
COMMERCE BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxx
------------------------
Title: Senior Vice President
---------------------
10.8-18
19
SCHEDULE 3.02
(FINANCIAL CONDITION)
Company has provided supplemental financial information to Bank in the
form of June 1997 "Y" Reports and call reports each subsidiary bank of
TFI.
10.8-19
20
SCHEDULE 3.04
(LITIGATION)
NONE
10.8-20
21
SCHEDULE 3.05
(LIABILITIES)
Distributions from the TeamBanc, Inc. Employees' Stock Ownership Plan can
be made in the form of stock and, in accordance with the plan document and
the Internal Revenue Code, Team Financial, Inc. has an obligation to
repurchase such securities.
10.8-21
22
SCHEDULE 3.12
(STOCK)
Company has previously provided documents relating to its Employee Stock
Purchase Plan acceptable to Bank.
10.8-22
23
AMENDMENT ONE TO TERM LOAN AGREEMENT
THIS AMENDMENT ONE TO TERM LOAN AGREEMENT ("Amendment One") is entered
into as of the 31st day of October, 1997, by and between COMMERCE BANK,
N.A. ("Bank") and TEAM FINANCIAL, INC. "Company").
WITNESSETH:
WHEREAS, pursuant to that certain Term Loan Agreement dated as of August
21, 1997, by and between Bank and Company ("Loan Agreement"), Bank agreed
to extend a Term Loan to Company in the original principal amount of
$247,000, subject to certain terms, limitations and conditions contained
therein;
WHEREAS, Company has requested that Bank amend one of the Affirmative
Covenants contained in the Loan Agreement; and
WHEREAS, Bank and Company have agreed to amend the Loan Agreement as
hereinafter set forth.
NOW, THEREFORE, for valuable consideration, Bank and Company do hereby
mutually agree as follows:
1.Terms used herein which are defined in the Loan Agreement shall
have the meanings given to them in the Loan Agreement.
2.Section 4.09 of the Loan Agreement is hereby amended to read in its
entirety as follows:
"Contributions. Company will make contributions to the Trust
sufficient for the Trust to pay principal and accrued interest on the
ESOP Note in accordance with the schedule of payments set forth
therein (such contributions to be referred to herein as "Scheduled
Contributions"). In addition to the foregoing, and provided that no
Event of Default (hereinafter defined) has occurred or will occur,
Company may make contributions to the Trust (i) in amounts adequate
to provide cash to, or to make other payments necessary in connection
with, terminating participants, and/or (ii)
10.8-23
24
in amounts to be maintained by the Trust "on deposit" to meet the
Trust's distribution and other ordinary course cash needs, provided
such sums "on deposit" shall not exceed $500,000 at any given time
(such contributions to be referred to herein as "Permitted
Contributions"). If Company makes contributions in an amount in
excess of Scheduled Contributions (and Permitted Contributions, if
applicable) ("Excess Contributions"), Company shall cause the Plan
Administrator (as set forth in the Plan) to direct the Trustee to use
such Excess Contributions to prepay the ESOP Note.
3.Except as amended herein, all other terms, provisions, conditions
and obligations imposed under the terms of the Loan Agreement shall remain in
full force and effect and are hereby ratified and certified by Bank and Company.
4.This Amendment One shall be governed by, and construed in
accordance with, the laws of the State of Missouri.
IN WITNESS WHEREOF, Bank and Company have executed this Amendment One as
of the date first above written.
COMMERCE BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxx
------------------------
Title: Senior Vice President
----------------------
TEAM FINANCIAL, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Title: Chairman & CEO
---------------------
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: Treasurer
---------------------
10.8-24
25
TERM NOTE
$247,000 August 21, 1997
Principal and Interest Kansas City, Missouri
FOR VALUE RECEIVED, the undersigned, TEAM FINANCIAL, INC., f/k/a TeamBanc,
Inc., a Kansas corporation ("Borrower") hereby promises to pay to the
order of COMMERCE BANK, N.A. ("Bank") the principal sum of Two Hundred
Forty-Seven Thousand Dollars ($247,000), payable in annual principal
installments of $35,285.71 commencing December 31, 1998, and continuing on
the last day of each December thereafter, until December 31, 2004, when
the outstanding principal balance, together with accrued interest, shall
be due and payable in full. This Term Note shall bear interest at a per
annum variable rate equal to one percent (1%) less than the Prime Rate (as
that term is defined in the Term Loan Agreement hereinafter identified),
to change with any change in the Prime Rate. Accrued interest shall be
payable quarterly, in arrears, commencing December 31, 1997, and
continuing on the last day of each March, June, September and December
thereafter, until and including the due date of this Term Note. Accrued
interest shall be calculated on the actual number of days outstanding
based on a year consisting of 365 days. Both principal and interest are
payable in lawful money of the United States of America to Bank, at its
offices at 1000 Walnut, Kansas City, Missouri, in immediately available
funds.
This Term Note is the one referred to in, and is entitled to the benefits
of, the Term Loan Agreement dated the date hereof between the Borrower and
the Bank, which Term Loan Agreement contains, among other things,
provisions for acceleration of the maturity hereof upon the happening of
certain stated events and for an increase in the interest rate upon the
occurrence of an Event of Default. The defined terms used herein shall
have the same meaning as used in the Term Loan Agreement.
The Borrower shall have the right to prepay the principal of this Term
Note, in whole or in part, prior to maturity without premium or penalty.
Any partial prepayments shall be applied to the principal payments in the
inverse order of their maturities.
The Borrower and all endorsers, sureties, guarantors and other persons
liable hereon or who may become liable for the payment hereof, severally
waive demand, presentment, notice of dishonor or nonpayment, notice of
protest and any and all lack of diligence in the enforcement hereof and
hereby assent to each and any extension or postponement of the time of
payment, at or after
10.8-25
26
maturity, or other indulgence and hereby waive any and all notice thereof.
This Term Note shall be governed by, and construed in accordance with, the
laws of the State of Missouri.
IN WITNESS WHEREOF, Borrower has executed this Term Note as of the day and
year first hereinabove written.
TEAM FINANCIAL, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Title: Chairman/CE0
---------------------
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: President
---------------------
10.8-26
27
COLLATERAL ASSIGNMENT
WHEREAS, TEAM FINANCIAL, INC., f/k/a TeamBanc, Inc. ("Company") and
COMMERCE BANK, N.A. ("Lender") have entered into a Term Loan Agreement
(the "Agreement") of even date herewith;
WHEREAS, the proceeds of the Term Loan to be extended to the Company under
the Agreement will be used by Company to fund a loan by Company to the
trustee (the "Trustee") of the TeamBanc, Inc. Employees Stock Ownership
Plan (the "Trust"), as established pursuant to the TeamBanc, Inc.
Employees Stock Ownership Plan dated as of November 6, 1992, as amended
from time to time (the "Plan"), pursuant to the agreement between the
Bank, the Company and the Trustee (the "Lending Agreement") and evidenced
by an ESOP Note (And Pledge Agreement) (the IIESOP Note") made by the
Trustee to Company and secured by a pledge of the common stock of Company
acquired by the Trust; and
WHEREAS, under the terms of the Agreement, Company agreed to pledge to
Lender the ESOP Note, and all common stock of Company from time to time
pledged thereunder, as collateral for its obligations under the Agreement.
NOW, THEREFORE, for valuable consideration, it is agreed as follows:
1. Company hereby pledges, assigns and transfers to Lender all its
right, title and interest in and to the ESOP Note and all common stock of
Company from time to time pledged thereunder.
2. Company agrees that all payments made by the Trust on the ESOP
Note shall be made directly to Lender and applied by Lender to the
obligations of the Trust on the ESOP Note, with a corresponding
application to the obligations of the Company under the Agreement.
3. Lender agrees to be bound by the terms of the ESOP Note with
respect to any required release of the common stock of Company pledged
thereunder.
10.8-27
28
IN WITNESS WHEREOF, Company has executed this Collateral Assignment as of
the 21st day of August, 1997.
TEAM FINANCIAL, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------
Title: Chairman & CEO
---------------------
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: President
---------------------
Acknowledged this 21st day of August, 1997
COMMERCE BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxx
------------------------
Title: Senior Vice President
---------------------
10.8-28
29
ESOP NOTE
(AND PLEDGE AGREEMENT)
$247,000 August 21, 0000
Xxxxxxxxx xxx Xxxxxxxx Xxxxxx Xxxx, Xxxxxxxx
The undersigned promises to pay to the order of TEAM FINANCIAL, INC., a
Kansas corporation, the principal sum of Two Hundred Forty-Seven Thousand
Dollars ($247,000) payable in annual principal installments of $35,285.71
commencing December 31, 1998, and continuing on the last day of each
December thereafter, until December 31, 2004, when the outstanding
principal balance, together with accrued interest, shall be due and
payable in full. This ESOP Note shall bear interest at a per annum
variable rate equal to one percent (10-.) less than the Prime Rate, as
that term is defined in that certain Term Loan Agreement of even date
herewith between Team Financial, Inc. ("Company") and Commerce Bank, N.A.
("Bank"), and shall change with any change in the Prime Rate. Accrued
interest shall be payable quarterly, in arrears, commencing December 31,
1997, and continuing on the last day of each March, June, September and
December thereafter, until and including the due date of this ESOP Note.
Accrued interest shall be calculated on the actual number of days
outstanding based on a year consisting of 365 days.
The funds advanced hereunder are proceeds of a loan made to Company by
Bank pursuant to the Term Loan Agreement and all terms contained herein
shall have the same meaning as used in the Term Loan Agreement.
The loan evidenced by this ESOP Note is a refinancing of that certain
outstanding loan from UMB Bank Kansas "UMB"), which loan from UMB was made
for the purpose of enabling Trustee to acquire "qualifying employer
securities" as such term is defined in Section 408(e) of the Employee
Retirement Income Security Act of 1974, as amended, and Section 4975(d)(3)
of the Code.
The holder hereof may arrange, adjust (provided, however, no adjustment to
payment dates shall accelerate such payment dates) and extend the times
and amounts of payments of interest and/or principal under this ESOP Note
without notice to or consent of and without releasing any party liable
hereon. All parties hereto consent and agree to waive presentment for
payment, demand for payment, protest and notice of dishonor and to any
extensions, renewals or revisions hereof, and further consent to the
release of any party hereto or any collateral or security for the payment
of this ESOP Note without affecting their liability hereunder.
10.8-29
30
To secure this ESOP Note the undersigned hereby pledges to the holder of
this ESOP Note the common stock of the Company acquired by the undersigned
with the proceeds of the UMB loan which, as of the date of this Agreement,
secures the repayment of such prior UMB loan ("Collateral"). Except with
respect to put options described in the ESOP Plan Documents (but limited
to stock released from the suspense account), at no time during the term
of this ESOP Note shall such stock be subject to any put, call, or other
option or any buy-sell or similar agreement.
The loan evidenced by this ESOP Note is without recourse against the
undersigned. Notwithstanding anything herein to the contrary, neither the
Company nor any other holder of this ESOP Note shall have any right to
assets of the Trust other than (a) the Collateral, (b) contributions
(other than contributions of securities of the Company) that are made to
the undersigned under the Trust to meet its obligations under this ESOP
Note, and (c) earnings attributable to the Collateral and the investment
of such contributions. The undersigned is not obligated to make any
payment of interest or principal on the ESOP Note except to the extent of
(i) the sum of all cash contributions theretofore received by it from the
Company to meet the undersigned's obligation on this ESOP Note and the
earnings attributable to the investment of such contributions, less (ii)
all payments of principal and interest theretofore made by the undersigned
on this ESOP Note.
Upon and to the extent of any failure by the undersigned to meet the
payment schedule of this ESOP Note, the holder hereof may at its option
require transfer of such of the Collateral as does not exceed the amount
of the payment default.
The fiscal year of the Plan (the "Plan Year") is January 1 through
December 31. For each Plan Year during the duration of the loan evidenced
by this ESOP Note, a portion of the pledged employer securities shall be
released from the pledge. The number of employer securities released will
equal the number of encumbered employer securities held immediately before
release for the current Plan Year multiplied by a fraction. The numerator
of the fraction is the amount of principal and interest paid during the
Plan Year. The denominator of the fraction is the sum of the numerator
plus the principal and interest to be paid for all future Plan Years. The
number of Plan Years taken into account hereunder shall be computed
without taking into account any possible extension or renewal periods of
the ESOP Note. For purposes of such calculation, the interest to be paid
in future years shall be computed by using the interest rate applicable as
10.8-30
31
of the end of the Plan Year. In the event the employer securities are to
include more than one class of securities, the number of securities of
each class to be released for a Plan Year must be determined by applying
the same fraction to each class. At the request of the Trustee, the
Company shall execute and deliver to the Trustee a certificate or
certificates representing the number of pledged shares to be released each
Plan Year pursuant to the provisions of this paragraph.
The undersigned shall have the right to prepay the principal of this ESOP
Note, in whole or in part, prior to maturity without premium or penalty.
Any partial prepayments shall be applied to the monthly principal payments
in the inverse order of their maturities.
This ESOP Note is non-negotiable and it may not be negotiated or assigned
by any holder hereof without the written consent of the undersigned. The
undersigned by execution hereof consents to the negotiation and assignment
of this ESOP Note to the Bank. As used herein, the words "to the order of"
refer only to any subsequent holders for whom such written consent has
been given.
This ESOP Note shall be deemed to have been made and delivered in the
State of Missouri and shall be governed by, and construed in accordance
with, the laws of the State of Missouri. Until advised otherwise by the
Bank, this ESOP Note shall be payable at the offices of Bank at 0000
Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx.
10.8-31
32
IN WITNESS WHEREOF, the undersigned has executed this ESOP Note as of the
day and year first hereinabove written.
TEAM FINANCIAL, INC., AS
TRUSTEE UNDER THE TEAMBANC, INC.
EMPLOYEES STOCK OWNERSHIP PLAN
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------
Title: Treasurer
----------------------
PAY TO THE ORDER OF
COMMERCE BANK, N.A.
WITH RECOURSE
TEAM FINANCIAL, INC.
By: /s/ Xxxxxx X Xxxxxxxxxx
-----------------------
Title: Chairman & CEO
--------------------
10.8-32
33
LENDING AGREEMENT
THIS LENDING AGREEMENT ("Agreement") is made and entered into as of
the 21st day of August, 1997, by and among COMMERCE BANK, N.A. ("Lender"),
TEAM FINANCIAL, INC., f/k/a TeamBanc, Inc. ("Company"), and TEAM
FINANCIAL, INC., f/k/a TeamBanc, Inc., as Trustee (the "Trustee") under
the TeamBanc, Inc. Employees Stock Ownership Plan, as established pursuant
to the TeamBanc, Inc. Employees Stock Ownership Plan dated as of November
6, 1992, as amended from time to time (the "Plan").
WITNESSETH:
WHEREAS, Lender has agreed to loan $247,000 to Company ("Loan"); and
WHEREAS, the parties hereto wish to restrict the use of the proceeds
of the Loan in the manner set forth herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants
and promises herein contained, the adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
USE OF PROCEEDS BY COMPANY
Company agrees that the proceeds of the Loan shall be used for the
sole purpose of lending such proceeds to the Trustee, such loan to be
evidenced by that certain ESOP Note (And Pledge Agreement) of even
date herewith made by the Trustee to the Company (the "ESOP Note"),
for the sole purpose of enabling the Trustee to refinance a prior
loan for the purchase by the Plan of "qualifying employer
securities", as such term is defined in Section 408(e) of the
Employee Retirement Income Security Act of 1974, as amended, and
Section 4975(d) (3) of the Internal Revenue Code of 1986, as amended.
USE OF PROCEEDS BY TRUSTEE
The Trustee agrees to use the amount loaned to the Trustee by
Company, which amount represents the proceeds of the Loan, for the
sole purpose of refinancing that certain outstanding loan from UMB
Bank Kansas ("Prior ESOP Loan", which loan was made for the purpose
bf enabling Trustee to acquire "qualifying employer securities" as
defined above).
10.8-33
34
PLEDGE OF SECURITIES
To secure the ESOP Note the Trustee hereby pledges and assigns to
Company or any holder of the ESOP Note all "qualifying employer
securities" which, as of the date of this Agreement, secured the
repayment of the Prior ESOP Loan. The Trustee acknowledges that the
ESOP Note and pledged "qualifying employer securities" will be
endorsed and assigned by Company to Lender as collateral for the Loan.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
written above.
COMMERCE BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxx
------------------------
Title: Senior Vice President
---------------------
TEAM FINANCIAL, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Title: Chairman & CEO
---------------------
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: President
---------------------
TEAM FINANCIAL, INC., as
Trustee Under the TeamBanc, Inc.
Employees Stock Ownership Plan
By: /s/ Xxxxxx X Xxxxxxxxxx
------------------------
Title: Chairman & CEO
---------------------
By: /s/ Xxxxxxx X. Xxxxxx
------------------------
Title: President
---------------------
10.8-34
