EXHIBIT 10 (R)
THIRD AMENDMENT TO LOAN AGREEMENT
---------------------------------
THIS THIRD AMENDMENT ("Third Amendment") dated as of the 15th day of July,
1998, to the Loan Agreement (the "Loan Agreement"), made and entered into as of
July 12, 1995, by and among SUMMIT BANCSHARES, INC., a Texas corporation,
(hereinafter called "Borrower") and THE FROST NATIONAL BANK, a national banking
association (hereinafter called "Lender"). All capitalized terms not otherwise
defined herein shall have the meaning ascribed to each of them in the Loan
Agreement.
WITNESSETH:
WHEREAS, Borrower executed the Loan Agreement to govern those two certain
promissory notes from Lender, specifically a $8,000,000.00 Acquisition Note and
a $1,000,000.00 Liquidity Note (collectively, the "Notes").
WHEREAS, Borrower executed the First Amendment to Loan Agreement on July
15, 1996 ("First Amendment") which renewed and extended the maturity date of the
Notes: and
WHEREAS, Borrower executed the Second Amendment to Loan Agreement on July
15, 1997 ("Second Amendment") which renewed and extended the maturity date of
the Notes; and
WHEREAS, the Borrower desires to again renew and extend the unpaid
principal balance of the Notes: and
WHEREAS, the Lender agrees to renew and extend the Notes all as hereinafter
provided.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Borrower and Lender do hereby agree as follows:
ARTICLE I
---------
AMENDMENT TO LOAN AGREEMENT
---------------------------
1.1 Amendment to Notes. As of the effective date hereof, the Borrower has
-------------------
zero outstanding under the Acquisition Note and the Liquidity Note. The Borrower
desires to renew these credit facilities by the execution of another Acquisition
Note and Liquidity Note extending the original payment terms and the maturity
date by one year. Accordingly, Sections 2.02 (s) and (b) of the Loan Agreement
shall be, and are hereby, amended to read in their entirety as follows:
(a) Acquisition Note. From Closing Date and continuing at all times
-----------------
through July 15, 1999 ( the "Revolving Credit Period") the Loan evidenced
by the Acquisition Note shall be a revolving credit facility which will
allow the Borrower to request such amounts as Borrower may elect from time
to time (each such amount being herein called an "Advance") so long as the
aggregate amount of Advances outstanding at any time under the Acquisition
Note does not exceed Eight Million and No/100 Dollars ($8,000,000.00)
provided however, the minimum Advance must be at least $500,000.00. The
Borrower shall have the right to borrow, repay, and
borrow again under the credit facility. The outstanding principal balance
of the Acquisition Note on July 15, 1999 shall convert to a term facility
(the "Term Period") and shall be payable in 20 equal quarterly installments
of principal plus all accrued and unpaid interest, with all unpaid
principal plus all accrued and unpaid interest being due and payable on
July 15, 2004. Principal and interest of the Acquisition Note shall be due
and payable as provided in the Acquisition Note.
(b) Liquidity Note. The Liquidity Note shall be due and payable as
---------------
follows: during the Revolving Credit Period the Loan evidenced by the
Liquidity Note shall be a revolving credit facility which will allow the
Borrower to request such amounts as Borrower may elect from time to time
(each such amount being herein call an "Advance") so long as the aggregate
amount of Advances outstanding at any time under the Liquidity Note does
not exceed One Million and No/100 Dollars ($1,000,000.00) provided however,
the minimum Advance must be at least $50,000.00. The Borrower shall have
the right to borrow, repay and borrow again under the credit facility. The
outstanding principal balance of the Liquidity Note on July 15, 1999 shall
convert to a term facility (the "Term Period") and shall be payable in 20
equal quarterly installments of principal plus all accrued and unpaid
interest, with all unpaid principal plus all accrued and unpaid interest
being due and payable on July 15, 2004. Principal and interest of the
Liquidity Note shall be due and payable as provided in the Liquidity Note.
ARTICLE II
----------
CONDITIONS OF EFFECTIVENESS
---------------------------
2.1 Effective Date. This Third Amendment shall become effective as of
---------------
July 15, 1998, when, and only when, Lender shall have received counterparts of
this Third Amendment executed and delivered by Borrower and when each of the
following conditions shall have been met, all in form, substance, and date
satisfactory to Lender.
(a) Renewal Notes. Borrower shall have executed and delivered to
--------------
Lender a new Acquisition Note and Liquidity Note, payable to the order of
Lender as set forth therein, duly executed on behalf of the Borrower, dated
effective July 15, 1997 in the principal amounts of $8,000,000.00 and
$1,000,000.00, respectively.
(b) Additional Loan Documents. Borrower shall have executed and
--------------------------
delivered to Lender such other documents as shall have been requested by
Lender to renew, and extend, the Loan Documents to secure payment of the
Obligations of Borrower, all in form satisfactory to Lender and its
counsel.
ARTICLE III
-----------
REPRESENTATIONS AND WARRANTIES
------------------------------
3.1 Representations and Warranties. In order to induce Lender to enter
-------------------------------
into this Third Amendment, Borrower represents and warrants the following:
(a) Borrower has the corporate power to execute and deliver this Third
Amendment, the Notes, and other Loan Documents and to perform all of its
obligations in connection herewith and therewith.
(b) The execution and delivery by Borrower of this Third Amendment,
the Notes, and other Loan Documents and the performance of its obligations
in connection herewith and therewith: (I) have been duly authorized or will
be duly ratified and affirmed by all requisite corporate action; (ii) will
not violate any provision of law, any order of any court or agency of
government of the Articles of Incorporation or Bylaws of such entity; (iii)
will not be in conflict with, result in a breach of or constitute (alone or
with due notice or lapse of time or both) a default under any indenture,
agreement or other instrument; and (iv) will not require any registration
with, consent or approval of or other action by any federal, state
provincia l or other governmental authority or regulatory body.
(c) There is no action, suit or proceeding at law or in equity or by
or before any governmental instrumentality or other agency or regulatory
authority now pending or, to the knowledge of Borrower, threatened against
or affecting Borrower or any properties or rights of Borrower or involving
this Third Amendment or the transactions contemplated hereby which, if
adversely determined, would materially impair the right of Borrower, to
carry business substantially as now conducted or materially and adversely
affect the financial condition of Borrower or materially and adversely
affect the ability of Borrower to consummate the transactions contemplated
by this Third Amendment.
(d) The representations and warranties of Borrower this Third
Amendment, the Notes, and any other contained in the Loan Agreement, Loan
Document securing Borrower's Obligations and indebtedness to Lender are
correct and accurate on and as of the date hereof as though made on and as
of the date hereof , except to the extent that the facts upon which such
representations are based have been changed by the transactions herein
contemplated.
ARTICLE IV
----------
RATIFICATION OF OBLIGATIONS AND LIENS
-------------------------------------
4.1 Ratification of Obligation. The Borrower does here acknowledge,
---------------------------
ratify and confirm that it is obligated and indebted to Lender as evidenced by
the Loan Agreement (as amended by the First Amendment, the Second Amendment and
this Third Amendment), the Notes and all other Loan Documents.
4.2 Valid Liens. Borrower hereby acknowledges and agrees that the liens
------------
and security interests and are superior to all liens and security interests
other than those exceptions approved by Lender in writing. Nothing herein
contained shall affect or impair the validity or priority of the liens and
security interests and are superior to all liens and security interests other
than those exceptions approved by Lender in writing.
Nothing herein contained shall affect or impair the validity or priority of the
liens and security interests under the Loan Documents.
4.3 Ratification of Agreements. The Loan Agreement (as previously amended
---------------------------
by the First Amendment and the Second Amendment), this Third Amendment, the
Notes, and each other Loan Document, as hereby amended, is acknowledged,
ratified and confirmed in all respects as being valid, existing, and of full
force and effect. Any reference to the Loan Agreement in any Loan Document shall
be deemed to be a reference to the Loan Agreement (as previously amended) and as
amended by this Third Amendment. The execution, delivery and effectiveness of
this Third Amendment shall not, except as expressly provided herein, operate as
a waiver of any right, power or remedy of Lender under the Loan Agreement, nor
constitute a waiver of any provision of the Loan Agreement. The Borrower
acknowledges, ratifies and confirms that the collateral securing the Loan
secures all of the indebtedness of the Borrower, including without limitation,
the Notes.
ARTICLE V
---------
MISCELLANEOUS
-------------
5.1 Survival of Agreements. All representations, warranties, covenants
-----------------------
and agreements of Borrower, herein or in any other Loan Document shall survive
the execution and delivery of this Third Amendment, and the other Loan Documents
and the performance hereof and thereof, including without limitation the making
or granting of the Loan and the delivery of the Notes and all other Loan
Documents, and shall further survive until all of Borrower's Obligations to
Lender are paid in full. All statements and agreements contained in any
certificate or instrument delivered by Borrower hereunder or under the Loan
Documents to Lender shall be deemed to constitute the respective representations
and warranties by Borrower and/or respective agreements and covenants of
Borrower under this Third Amendment and under the Loan Agreement.
5.2 Loan Document. This Third Amendment, the Notes, and each other Loan
--------------
Documents executed in connections herewith are each a Loan Document and all
provisions in the Loan Agreement, as amended, pertaining to Loan Documents apply
hereto and thereto.
5.3 Governing Law. This Third Amendment shall be governed by and construed
--------------
in all respects in accordance with the laws of the State of Texas and any
applicable laws of the United States of America, including construction,
validity and performance.
5.4 Counterparts. This Third Amendment may be separately executed in any
-------------
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Third Amendment.
5.5 Release of Claims. Borrower by its execution of this Third Amendment,
------------------
hereby declares that it has no set-offs, counterclaims, defenses or other causes
of action against Lender arising out of the Loan, the renewal, modification and
extension of the Loan, any documents mentioned herein or otherwise; and, to the
extent any such setoffs, counterclaims, defenses or other causes of action which
may exist, whether known or unknown, such items are hereby expressly waived and
released by Borrower.
5.6 Attorneys' Fees. Borrower hereby agrees to pay Lender, upon demand,
----------------
the reasonable attorneys' fees and expenses of Lender's counsel, filing and
recording fees and other reasonable expenses incurred by Lender in connection
with this Third Amendment. Borrower also agrees to provide to Lender such other
documents and instruments as Lender may reasonably request in connection with
the renewal, extension and modification of the Loans mentioned herein.
5.7 ENTIRE AGREEMENT. THIS THIRD AMENDMENT, TOGETHER WITH ANY LOAN
-----------------
DOCUMENTS EXECUTED IN CONNECTION HEREWITH , CONTAINS THE ENTIRE AGREEMENT
BETWEEN THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND
ALL PRIOR AGREEMENTS RELATIVE THERETO WHICH ARE NOT CONTAINED HEREIN OR THEREIN
ARE TERMINATED. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. THIS
THIRD AMENDMENT, AND THE LOAN DOCUMENTS MAY BE AMENDED, REVISED, WAIVED,
DISCHARGED, RELEASED OR TERMINATED ONLY BY A WRITTEN INSTRUMENT OR INSTRUCTIONS,
EXECUTED BY THE PARTY AGAINST WHICH ENFORCEMENT OF THE AMENDMENT, REVISION,
WAIVER, DISCHARGE, RELEASE OR TERMINATION IS ASSERTED. ANY ALLEGED AMENDMENT,
REVISION, WAIVER, DISCHARGE, RELEASE OR TERMINATION WHICH IS NOT SO DOCUMENTED
SHALL NOT BE EFFECTIVE AS TO ANY PARTY.
IN WITNESS WHEREOF, this Third Amendment is executed effective as of the
date first written above.
BORROWER: SUMMIT BANCSHARES, INC.
By: /s/ Philip E. Norwood
----------------------------------
Its: Chairman
--------------------------------
By: /s/ Bob G. Scott
---------------------------------
Its: Executive Vice President
---------------------------------
LENDER: THE FROST NATIONAL BANK
By: /s/ Jerry L. Crutsinger
--------------------------------
Its: Vice President
--------------------------------
SUMMIT BANCSHARES, INC. AND SUBSIDIARIES
EXHIBIT 21
SUBSIDIARIES OF THE CORPORATION
Subsidiaries State of Incorporation
- ------------ ----------------------
Summit National Bank, Fort Worth, Texas National Association
Summit Community Bank, N.A., Fort Worth, Texas National Association
Summit Bancservices, Inc., Fort Worth, Texas Texas