1
EXHIBIT 10.6
2
$90,000,000
SECURED CREDIT AGREEMENT
------------------------
($50,000,000 TERM LOAN)
($40,000,000 REVOLVING LOAN)
DATED AS OF JULY 18, 1996
AMONG
FIRST BANKS, INC.
AND
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO
HARRIS TRUST AND SAVINGS BANK
THE FROST NATIONAL BANK
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
AND
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS,
AS AGENT
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TABLE OF CONTENTS
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Page
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ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS 1
Section 1.01. Defined Terms 1
Section 1.02. Accounting Terms 8
ARTICLE II.
AMOUNT AND TERMS OF TERM LOANS 8
Section 2.01. Term Loans 8
Section 2.02. Manner of Disbursement 8
Section 2.03. Interest on Term Loans 8
Section 2.04. Notice of Interest Rate Selection 9
Section 2.05. Repayment of Term Loans; Application of Payments 11
Section 2.06. Optional Prepayment 11
Section 2.07. Term Notes 11
Section 2.08. Method of Payment 12
Section 2.09. Use of Term Loan Proceeds 12
Section 2.10. Advances and Payments 12
Section 2.11. Reimbursement 12
Section 2.12. No Renewal Option 13
ARTICLE III.
AMOUNT AND TERMS OF REVOLVING LOAN AND LETTERS OF CREDIT 13
Section 3.01. Commitments 13
Section 3.02. Revolving Credit 13
Section 3.03. Termination or Reduction of Revolving Loan Commitment 13
Section 3.04. Interest on Revolving Loans. 14
Section 3.05. Notice and Manner of Borrowing 14
Section 3.06. Revolving Notes 16
Section 3.07. Method of Payment 17
Section 3.08. Use of Proceeds 17
Section 3.09. Zero Balance 17
Section 3.10. Advances and Payment 17
Section 3.11. Revolving Loan Commitment Fee 18
Section 3.12. Reimbursement 18
Section 3.13. Agreement to Issue Letters of Credit 18
Section 3.14. Letter of Credit Requests 19
Section 3.15. Letter of Credit Participation 20
Section 3.16. Agreement to Repay Letter of Credit Drawings 21
Section 3.17. Notice of Letter of Credit Outstandings. 23
Section 3.18. Deemed Disbursements; Cash Collateralization 23
Section 3.19. Failure of Any Bank to Make Revolving Loans or
Participate in Letters of Credit 23
Section 3.20. Letter of Credit Fees 24
Section 3.21. Banks Not Required to Extend Credit 25
ARTICLE IV.
CONDITIONS PRECEDENT 25
Section 4.01. Conditions Precedent to the Term Loans and Initial Revolving Loans 25
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Section 4.02. Conditions Precedent to All Revolving Loans 26
ARTICLE V.
REPRESENTATIONS AND WARRANTIES 27
Section 5.01. Incorporation, Good Standing, and Due Qualification 27
Section 5.02. Corporate Power and Authority 27
Section 5.03. Legally Enforceable Agreement 28
Section 5.04. Financial Statements; Financial Condition 28
Section 5.05. Other Agreements 28
Section 5.06. Litigation 28
Section 5.07. Ownership of Subsidiaries 29
Section 5.08. ERISA 29
Section 5.09. Taxes 29
ARTICLE VI.
AFFIRMATIVE COVENANTS 29
Section 6.01. Maintenance of Existence 29
Section 6.02. Maintenance of Records 30
Section 6.03. Maintenance of Subsidiaries 30
Section 6.04. Compliance With Laws 30
Section 6.05. Right of Inspection 30
Section 6.06. Reporting Requirements 30
Section 6.07. Operations 32
Section 6.08. Additional Collateral 32
ARTICLE VII.
NEGATIVE COVENANTS 32
Section 7.01. Liens 32
Section 7.02. Mergers, Etc 32
Section 7.03. Indebtedness 33
Section 7.04. Dividends 33
Section 7.05. Stock Issue; Additional Issue of Stock of Subsidiary 33
Section 7.07. Loans 34
Section 7.08. Continuation of Business 34
ARTICLE VIII.
FINANCIAL COVENANTS 35
Section 8.01. Tier I Leverage Ratio 35
Section 8.02. Tier I Leverage Ratio of Subsidiaries 35
Section 8.03. Tier I Risk Based Capital Ratio 35
Section 8.04. Total Risk Based Capital Ratio 35
Section 8.05. Loan Loss Reserve 36
Section 8.06. Net Income to Average Total Assets 36
Section 8.07. Non-Performing Assets 36
ARTICLE IX.
EVENTS OF DEFAULT 36
Section 9.01. Events of Default 36
ARTICLE X.
AUTHORITY AND RESPONSIBILITIES OF AGENT 39
Section 10.01. Grant of Authority 39
Section 10.02. Action upon Indemnification Instructions 39
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Section 10.03. Reports; Responsibility of the Agent; Disclaimer 39
Section 10.04. Correction of Errors 40
Section 10.05. Expenses; Indemnification 40
Section 10.06. Rights as Bank 41
Section 10.07. Representation of Each Bank 41
Section 10.08. Rights to Resign; Appointment of a Successor Agent 41
Section 10.09. Notice of Default 42
Section 10.10. Agent Compensation 42
ARTICLE XI.
MISCELLANEOUS 42
Section 11.01. Capital Adequacy Reimbursement 42
Section 11.02. Amendments, Etc 43
Section 11.03. Notices, Etc 43
Section 11.04. No Waiver; Remedies 43
Section 11.05. Successors and Assigns 43
Section 11.06. Costs and Expenses 44
Section 11.07. Right of Setoff 44
Section 11.08. Sharing of Setoffs 44
Section 11.09. Governing Law; Jurisdiction and Venue 45
Section 11.10. Severability of Provisions 45
Section 11.11. Counterparts 45
Section 11.12. Headings 45
Section 11.13. Oral Agreements 45
EXHIBIT A
TERM LOAN COMMITMENT AMOUNTS 47
EXHIBIT B
TERM NOTE 48
EXHIBIT C
NOTICE OF INTEREST RATE SELECTION 50
EXHIBIT D
REVOLVING LOAN COMMITMENT AMOUNTS 51
EXHIBIT E
REVOLVING CREDIT NOTE 52
EXHIBIT F
NOTICE OF BORROWING 54
EXHIBIT G
PLEDGE AGREEMENT 55
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EXHIBIT G-1
SUBSIDIARY PLEDGE AGREEMENT 61
EXHIBIT H
CERTIFICATE OF COMPLIANCE 67
EXHIBIT I
FORM OF LETTER OF CREDIT 72
EXHIBIT J
LETTER OF CREDIT REQUEST 75
EXHIBIT K
FORM OF BORROWER'S COUNSEL OPINION 77
EXHIBIT L
PLEDGED SUBSIDIARIES 83
EXHIBIT M
LIST OF AFFILIATES 84
EXHIBIT N
IDENTIFICATION OF FINANCIAL STATEMENTS 85
EXHIBIT O
OWNERSHIP OF SUBSIDIARIES 86
EXHIBIT P
LIST OF ADDRESSES 88
SCHEDULE 3.13
OUTSTANDING LETTERS OF CREDIT 90
SCHEDULE 5.05
OTHER AGREEMENTS 91
SCHEDULE 5.06
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LITIGATION 92
SCHEDULE 5.08
PLAN TERMINATIONS 93
SCHEDULE 9.01(10)
REGULATORY ACTIONS 94
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SECURED CREDIT AGREEMENT
THIS SECURED CREDIT AGREEMENT dated as of July 18, 1996, is
entered into by and among FIRST BANKS, INC., a Missouri corporation
("Borrower"), and THE BOATMEN'S NATIONAL BANK OF ST. LOUIS, a national
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banking association, AMERICAN NATIONAL BANK AND TRUST COMPANY OF CHICAGO, a
national banking association, HARRIS TRUST AND SAVINGS BANK, an Illinois
state banking corporation, THE FROST NATIONAL BANK, a national banking
association, and NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, a national
banking association (each individually a "Bank" and collectively the
"Banks"), and THE BOATMEN'S NATIONAL BANK OF ST. LOUIS, a national banking
association, as Agent.
W I T N E S S E T H T H A T :
WHEREAS, Borrower has requested that the Banks severally make a
term loan to Borrower in the aggregate amount of Fifty Million Dollars
($50,000,000) (as the same may be renewed, extended, amended, rearranged,
restructured, refinanced, replaced or otherwise modified from time to time,
including without limitation, modifications to interest rates or other
payment terms, the "Term Loan"); and
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WHEREAS, Borrower has requested that the Banks severally make
available to Borrower a revolving credit and letter of credit facility in
the aggregate amount of Forty Million Dollars ($40,000,000) (as the same may
be renewed, extended, amended, rearranged, restructured, refinanced,
replaced or otherwise modified from time to time, including without
limitation, modifications to interest rates or other payment terms, the
"Revolving Loan"); and
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WHEREAS, the Banks are willing severally to provide such loan
and facility to the Borrower, subject to the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto hereby agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
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Section I.01. Defined Terms. As used in this Agreement, the
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following terms have the following meanings (terms defined in the singular
to have the same meaning when used in the plural and vice versa):
"Affiliate" means any Person (1) which directly or indirectly
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controls, or is controlled by, or is under common control with, the Borrower
or any Subsidiary; (2) which directly or indirectly beneficially owns or
holds (i) five percent (5%) or more of any class of voting stock of Borrower
or any Subsidiary, except any class of voting stock of First Banks America,
Inc., or (ii) five percent (5%) or more of all voting stock of First Banks
America, Inc., or (3) five percent (5%) or more of the voting stock of which
is directly or indirectly beneficially owned or held by Borrower or any
Subsidiary. The term "Control" for the purposes of this Agreement means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract, or otherwise. For the purposes
of the foregoing definition, a shareholder of Borrower
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shall not be deemed to be directly or indirectly controlling or controlled by
the Borrower or a subsidiary, provided the person in question will not receive
any proceeds from the Loans.
"Agent" means The Boatmen's National Bank of St. Louis, acting
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in its capacity as Agent pursuant to Article X hereof and any duly appointed
successor.
"Agreement" means this Secured Credit Agreement, as amended,
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supplemented or modified from time to time.
"Agreement and Plan of Reorganization" has the meaning assigned
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to such term in Section 3.13(1).
"Bank" or "Banks" has the meaning assigned to such term in the
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preamble to this Agreement.
"Borrower" has the meaning assigned to such term in the preamble
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of this Agreement.
"Business Day" means any day other than a Saturday, Sunday, or
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other day on which commercial banks are authorized or required to close
under the laws of the States of Missouri, Illinois, Texas or California.
"Call Report" has the meaning assigned to such term in Section
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6.06(4).
"Certificate" has the meaning assigned to such term in Section
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3.05.
"Collateral" means all property which is subject or is to be
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subject to the Liens granted by the Pledge Agreement and/or the Subsidiary
Pledge Agreements.
"Commitment" means the collective several commitments of the
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Banks in the aggregate original principal amount of $90,000,000, or when
used with reference to a particular Bank, the portion of the collective
several commitments allocated to such Bank, (i) to make loans to the
Borrower pursuant to Section 2.01, in an amount equal to the amount stated
in Exhibit A, and (ii) to make loans to the Borrower pursuant to Section
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3.01 and to participate in Letters of Credit pursuant to Section 3.15 in an
amount equal to the amount stated in Exhibit D, as such amount may be
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reduced from time to time pursuant to Section 3.03 hereof.
"Corporate Base Rate" means the rate of interest announced by
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The Boatmen's National Bank of St. Louis (or its successor) from time to
time as its Corporate Base Rate, which rate is not intended or represented
to be the lowest rate of interest charged by such Bank to its borrowers.
"Default" means any of the events specified in Section 9.01,
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whether or not any requirement for the giving of notice, the lapse of time,
or both, or any other condition, has been satisfied.
"Drawing" has the meaning assigned to such term in Section 3.15.
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"Equity Capital" for any Person, for any period, means the
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amount set forth on the most recent report on form FRY-9C filed by Borrower
with the Board of Governors of the Federal Reserve System (or any successor
report) applicable to such period as "Total Equity Capital."
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"ERISA" means the Employee Retirement Income Security Act of
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1974, as amended from time to time, and the regulations and published
interpretations thereof.
"ERISA Affiliate" means any trade or business (whether or not
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incorporated) which together with the Borrower would be treated as a single
employer under Section 4001 of ERISA.
"Eurodollar Rate" means, for the applicable Interest Period, if
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any, an interest rate per annum equal to the rate per annum (rounded upward
to the nearest whole multiple of 1/16 of 1% per annum, if such average is
not such a multiple) at which deposits in United States Dollars are offered
or available to banks in the London interbank market at 11:00 A.M. (London
time) two (2) Business Days before the first day of such Interest Period as
reported on Telerate Screen page 3750 for a period equal to such Interest
Period for the amount of the subject Eurodollar Rate Loan. The Eurodollar
Rate for each respective Interest Period, if any, shall be determined by the
Agent two (2) Business Days before the first day of such Interest Period.
"Event of Default" means any of the events specified in Section
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9.01, provided that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.
"Federal Funds Rate" means, for any day, the rate per annum
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(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates of overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the
Business Day next succeeding such day, provided that (i) if such day is not
a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on the
next succeeding Business Day, and (ii) if no such rate is so published on
such next succeeding Business Day, the Federal Funds Rate for such day shall
be the average rate quoted to the Agent on such day on such transactions as
determined by the Agent.
"GAAP" means generally accepted accounting principles in the
----
United States as in effect from time to time, including such principles as
are utilized in the preparation of Call Reports and other regulatory reports
required to be filed by Borrower and its Subsidiaries.
"Gain on Sale of Securities" for any Person, for any period,
--------------------------
means the amount set forth on the most recent report on form FRY-9C filed by
Borrower with the Board of Governors of the Federal Reserve System (or any
successor report) applicable to such period as "Realized gains (losses) on
held-to-maturity securities" and "Realized gains (losses) on available
for-sale securities."
"Interest Period" means the period commencing on the date of
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making or conversion to or continuation of a Loan to the Eurodollar Rate.
The Borrower shall have the option to select a one month, two month, or
three month Interest Period; provided, however, that whenever the last day
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of any Interest Period would otherwise occur on a day other than a Business
Day, the last day of such Interest Period shall be extended to occur on the
next succeeding Business Day; provided, however, that if such extension
would cause the last day of such Interest Period to occur in the next
following calendar month, the last day of such Interest Period shall occur
on the next preceding Business Day. Notwithstanding the foregoing, the
Borrower may not select an Interest Period: (i) if after giving effect
thereto the Borrower will be unable to make a principal payment scheduled to
be made during such Interest Period without paying part of the Loan accruing
at the Eurodollar Rate on a date other than the last day of the Interest
Period applicable thereto; or (ii) which ends after the Term Loan Maturity
Date (with respect to Term Loans) or the Revolving Credit Termination Date
(with respect to Revolving Loans). For purposes
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of determining an Interest Period, a month means a period starting on one day
in a calendar month and ending on a numerically corresponding day in the next
calendar month, provided, however, if an Interest Period begins on the last
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day of a month or if there is no numerically corresponding day in the month in
which an Interest Period is to end, then such Interest Period shall end on the
last Business Day of such month.
"L/C Coverage Requirement" means, with respect to each Letter of
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Credit, the sum of 100% of the Stated Amount of such Letter of Credit plus
the amount of Letter of Credit Fees and other fees expected to become
payable to the Agent and the Banks in respect thereof during the life of
such Letter of Credit which have not theretofore been paid.
"Letter of Credit" has the meaning assigned to such term in
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Section 3.13.
"Letter of Credit Fee" has the meaning assigned to such in
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Section 3.20.
"Letter of Credit Fee Payment Date" has the meaning assigned to
---------------------------------
such term in Section 3.20.
"Letter of Credit Outstandings" means, at any time, without
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duplication, the sum of (a) the aggregate Stated Amount of all outstanding
Letters of Credit, and (b) the aggregate amount of all Unpaid Drawings.
"Letter of Credit Participation" has the meaning assigned to
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such term in Section 3.15.
"Letter of Credit Request" has the meaning assigned to such term
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in Section 3.14.
"Lien" means any mortgage, deed of trust, pledge, security
----
interest, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), or preference, priority, or other security agreement
or preferential arrangement, charge, or encumbrance of any kind or nature
whatsoever (including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing, and the filing of any financing
statement under the Uniform Commercial Code or comparable law of any
jurisdiction to evidence any of the foregoing).
"Loan Loss Reserve" for any Person, for any period, means the
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amount set forth on the most recent report on form FRY-9C filed by Borrower
with the Board of Governors of the Federal Reserve System (or any successor
report) applicable to such period as "Allowance for loan and lease losses."
"Loan Document(s)" means this Agreement, the Notes, the Pledge
----------------
Agreement, the Subsidiary Pledge Agreements and any and all letter of credit
applications completed by the Borrower pursuant to Section 3.14 hereof.
"Loans" means the Revolving Loans and the Term Loan.
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"Majority" has the meaning assigned to such term in Section
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10.01.
"Multiemployer Plan" means a Plan described in Section
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4001(a)(3) of ERISA which covers employees of a Borrower or any ERISA
Affiliate.
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"Net Income" for any period means the amount set forth on the
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report on form FRY-9C filed by Borrower with the Board of Governors of the
Federal Reserve System or any successor report applicable to such period as
"Net Income."
"Non-performing Assets" for any Person, for any period, means
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the sum of the amounts set forth on the most recent report on form FRY-9C
filed by Borrower with the Board of Governors of the Federal Reserve System
(or any successor report) applicable to such period as loans "past due 90
days or more and still accruing," "non-accrual," and "other real estate
owned."
"Notes" means the Revolving Notes and Term Notes.
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"Notice of Borrowing" has the meaning assigned to such term in
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Section 3.05.
"Notice of Interest Rate Selection" has the meaning assigned to
---------------------------------
such in Section 2.04.
"PBGC" means the Pension Benefit Guaranty Corporation or any
----
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, business
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trust, joint stock company, trust, unincorporated association, joint
venture, governmental authority, or other juridical entity of whatever
nature.
"Plan" means any employee benefit or other plan established,
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maintained, or to which contributions have been made by the Borrower or any
ERISA Affiliate.
"Pledge Agreement" means the collateral pledge agreement in the
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form of Exhibit G, pledging to the Agent for the ratable benefit of the
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Banks all of the stock of the Pledged Subsidiaries (exclusive of directors'
qualifying shares of stock) and certain stock acquired after the date of
this Agreement.
"Pledged Subsidiaries" means the Subsidiaries listed on Exhibit L
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attached hereto.
"Primary Capital" for any Person, for any period and without
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duplication, means the sum of Equity Capital plus the Loan Loss Reserve of
such Person.
"Prohibited Transaction" means any transaction set forth in
----------------------
Section 406 of ERISA or Section 4975 of the Internal Revenue Code of 1954,
as amended from time to time.
"Repayment Tranche" has the meaning assigned to such term in
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Section 2.04.
"Reportable Event" means any of the events set forth in Section
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4043 of ERISA.
"Revolving Credit Termination Date" means July 11, 1997.
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"Revolving Loans" has the meaning assigned to such term in
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Section 3.02.
"Revolving Loan Limit" has the meaning assigned to such term in
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Section 3.02.
"Revolving Loan Commitment" means, as to each Bank, the maximum
-------------------------
amount which such Bank shall be obligated to loan to Borrower as a Revolving
Loan pursuant to Section 3.02 hereof.
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"Revolving Loan Commitment Fee" has the meaning assigned to such
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term in Section 3.11.
"Revolving Notes" has the meaning assigned to such term in
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Section 3.06.
"St. Charles Letter of Credit" has the meaning assigned to such
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term in Section 3.13(1).
"Stated Amount" means, with respect to each Letter of Credit,
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the maximum amount available to be drawn thereunder, determined without
regard to whether any conditions to drawing then could be met.
"Subsidiary" means, as to Borrower, any corporation of which
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shares of stock having ordinary voting power (other than stock having such
power only by reason of the happening of a contingency) to elect a majority
of the board of directors or other managers of such corporation are at the
time owned, or the management of which corporation is otherwise controlled,
directly or indirectly through one or more intermediaries, or both, by a
Borrower or a Subsidiary of Borrower.
"Subsidiary Pledge Agreements" means the collateral pledge
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agreements (subsidiary) in the form of Exhibit G-1, pledging to the Agent
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for the ratable benefit of the Banks all of the stock of the Subsidiary
listed on the Subdiary Pledge Agreement Exhibit A attached thereto
(exclusive of directors' qualifying shares of stock) and certain stock
acquired after the date of this Agreement.
"Term Loans" has the meaning assigned to such term in Section
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2.01.
"Term Loan Commitment" means, as to each Bank, the amount which
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such Bank shall be obligated to loan to Borrower as a Term Loan pursuant to
Section 2.01 hereof.
"Term Loan Maturity Date" means July 12, 2000.
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"Term Notes" has the meaning assigned to such term in Section
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2.07.
"Tier I Leverage Ratio" means the ratio, expressed as a
---------------------
percentage, of regulatory "core" capital (Tier I) to assets, all as defined
and determined from time to time by applicable bank regulatory authorities.
"Tier I Risk Based Capital Ratio" means the ratio of regulatory
-------------------------------
"core" capital (Tier I) to weighted-risk assets and off-balance sheet items,
all as defined and determined from time to time by applicable bank
regulatory authorities.
"Total Assets" for any Person, for any period, means the amount
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set forth on the most recent report on form FRY-9C filed by Borrower with
the Board of Governors of the Federal Reserve System (or any successor
report) applicable to such period as "Total Assets."
"Total Loans" means, at any time, the amount set forth on the
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most recent report on form FRY-9C filed by Borrower with the Board of
Governors of the Federal Reserve System (or any successor report) as the
total of "Loans and Leases, net of unearned income."
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"Total Risk Based Capital Ratio" of any Person means, at any
------------------------------
time, the ratio of regulatory "core" capital (Tier I) and supplementary
capital elements (Tier II) to weighted-risk assets and off-balance sheet
items, all as defined and determined from time by applicable bank regulatory
authorities.
"Unpaid Drawings" means as of any date, the aggregate of all
---------------
payments made by the Agent under any Letter of Credit which have not been
reimbursed by the Borrower pursuant to Section 3.16.
"Watch List" means a summary of loans or other assets of
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Borrower and each Pledged Subsidiary which have been adversely classified or
placed on a "watch list" by Borrower or a Pledged Subsidiary, as the case
may be, for the purpose of adverse classification of loans.
Section I.02. Accounting Terms. All accounting terms not
----------------
specifically defined herein shall be construed in accordance with GAAP
consistent with those applied in the preparation of the financial statements
and reports referred to in Section 6.06, and all financial data submitted
pursuant to this Agreement shall be prepared in accordance with such
principles.
ARTICLE II.
AMOUNT AND TERMS OF TERM LOANS
------------------------------
Section II.01. Term Loans.
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(1) Each Bank, severally and not jointly, shall, upon the
terms and subject to the conditions of this Agreement (including, without
limitation, the terms and conditions of Article IV hereof), lend to the
Borrower the proceeds of a term loan, in the amounts equal to each Bank's
Term Loan Commitment as set forth opposite such Bank's name in Exhibit A
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(collectively the "Term Loan").
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(2) The aggregate principal amount of the Term Loans shall be
Fifty Million Dollars ($50,000,000) and shall be made severally by the Banks
in accordance with their respective Term Loan Commitments.
(3) The Term Loans will bear interest in accordance with the
terms of Section 2.03.
(4) The failure of any Bank to make a Term Loan shall not
relieve any other Bank of its obligation to make a Term Loan pursuant to the
terms and conditions of this Agreement.
Section II.02. Manner of Disbursement. The Term Loans shall
----------------------
be disbursed, in full, on the date hereof.
Section II.03. Interest on Term Loans. The Borrower shall
----------------------
pay interest on the outstanding and unpaid principal amount of the Term
Loans from the date hereof until they shall be due (at maturity, whether by
reason of acceleration or otherwise) at the following intervals and at the
following rates per annum:
(1) Corporate Base Rate. When accruing interest at the
-------------------
Corporate Base Rate, a fluctuating rate per annum equal to the Corporate
Base Rate in effect from time to time. Any change in the interest rate
resulting from a change in the Corporate Base Rate shall become effective as
of the opening of business on the day on which such change in the Corporate
Base
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Rate shall become effective. Interest shall be calculated on the basis
of the actual number of days elapsed over a year of 360 days. Interest
shall be paid in immediately available funds on or before 12:00 Noon (St.
Louis time) on the first day of each calendar month beginning August 1,
1996, and on the Term Loan Maturity Date. In the event of receipt of funds
after 12:00 Noon (St. Louis time) on the date of payment, the funds shall be
deemed to be received on the next Business Day, and the accrual of interest
shall be calculated accordingly;
(2) Eurodollar Rate. When accruing interest at the Eurodollar
---------------
Rate, a rate per annum equal at all times during the applicable Interest
Period to the sum of the Eurodollar Rate for such Interest Period plus one
and one-half percent (1.5%) per annum. Interest shall be calculated on the
basis of the actual number of days elapsed over a year of 360 days.
Interest shall be paid in immediately available funds on or before 12:00
Noon (St. Louis time) on the first day of each calendar month beginning
August 1, 1996, and on the Term Loan Maturity Date. In the event of receipt
of funds after 12:00 Noon (St. Louis time) on the date of payment, the funds
shall be deemed to be received on the next Business Day, and the accrual of
interest will be calculated accordingly;
provided, however, that, from and after the occurrence of an Event of
- -------- -------
Default and unless and until such Event of Default is waived, the Borrower
shall pay interest on the unpaid principal amount of the Term Loan at a rate
per annum equal at all times to four percent (4%) per annum above the
interest rate otherwise in effect from time to time, such interest being
payable on demand. The Agent shall give prompt notice to the Borrower and
the Banks of the applicable interest rate determined by the Agent for
purposes of this Section 2.03
Section II.04. Notice of Interest Rate Selection.
---------------------------------
(1) Except as otherwise provided herein, the Term Loan shall
bear interest at the Corporate Base Rate. Subject to the terms and
conditions of this Agreement, Borrower shall have the option to have
interest on the Term Loan accrue at the Eurodollar Rate or at the Corporate
Base Rate; provided, however, that the Borrower shall, at the end of an
-------- -------
Interest Period, have the option to have interest on a portion of the Term
Loan in an amount equal to the next principal payment then scheduled to be
made hereunder (the "Repayment Tranche") accrue at the Corporate Base Rate
-----------------
and have interest on the remaining portion of the Term Loan accrue at the
Eurodollar Rate. The Borrower shall give the Agent (who shall promptly
notify the Banks) telephonic notice (followed immediately by written or
telex notice) of any election by Borrower to change the interest rate
applicable to the Term Loan or to select a new Interest Period in the event
the Term Loan is then accruing interest at the Eurodollar Rate. Such notice
of interest rate selection (a "Notice of Interest Rate Selection") shall be
---------------------------------
substantially in the form of Exhibit C hereto. At least three (3) Business
---------
Days before (i) the date on which Borrower desires to convert the interest
rate applicable to the Term Loan from the Corporate Base Rate to the
Eurodollar Rate or (ii) the end of the then current Interest Period, the
Borrower shall give the Agent (who shall promptly notify the Banks) a Notice
of Interest Rate Selection specifying the new Interest Period; if no such
notice is given (or, if Borrower is not entitled to deliver such notice
pursuant to the terms hereof), the Term Loan shall bear interest at the
Corporate Base Rate from and after the expiration of such Interest Period.
The Borrower shall have no right to effect the conversion of the applicable
interest rate from the Eurodollar Rate to the Corporate Base Rate other than
as of the end of an Interest Period. All notices given under this Section
2.04 shall be irrevocable and binding on the Borrower and telephonic notices
shall be given not later than 11:00 A.M. (St. Louis time) on the day which
is not later than the number of Business Days specified above for such
notice. If a Default or Event of Default exists hereunder, the Borrower
shall not have the right to request a Eurodollar Rate of interest, and in
the event the Term Loan is then accruing at the Eurodollar Rate, the then
current interest rate (if after the occurrence of an Event of Default) shall
be revised to be the Eurodollar
8
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Rate plus five and one-half percent (5.5%) (as set forth in Section 2.03) and
at the end of the then current Interest Period the Term Loan, if then accruing
at the Eurodollar Rate and such Default or Event of Default is then
continuing, shall immediately and automatically and without the necessity of
any further action by the Borrower, the Banks, or the Agent, accrue at the
Corporate Base Rate (plus four percent (4%) if after the occurrence of an
Event of Default) in the same principal amount, and any costs and expenses
incurred by virtue of such conversion (including without limitation the costs
and expenses identified in Section 11.06(2)) shall be promptly paid by
Borrower to the Agent on the demand of the Agent and the outstanding principal
balance of the Term Loan shall thereafter accrue at the Corporate Base Rate
(plus four percent (4%) if after the occurrence of an Event of Default).
(2) Anything in subsection (1) above to the contrary
notwithstanding,
(a) if the Agent shall notify the Borrower that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or that any central bank or other governmental
authority asserts that it is unlawful, for the Agent or any of the Banks to
perform its obligations hereunder, the right of Borrower to continue or
convert the Term Loan to the Eurodollar Rate shall be suspended until the
Agent shall notify the Borrower that the circumstances causing such
suspension no longer exist, and the outstanding portion of the Term Loan
accruing at the Eurodollar Rate shall immediately and automatically upon the
sending of such notice and without the necessity of any further action by
the Borrower, the Banks, or the Agent accrue at the Corporate Base Rate in
the same principal amount, and any costs and expenses incurred by virtue of
such conversion (including without limitation the costs and expenses
identified in Section 11.06(2)) shall be promptly paid by Borrower to the
Agent on the demand of the Agent; and
(b) if the Agent is unable, after reasonable efforts,
due to prevailing market conditions, to provide timely information for the
determination of the Eurodollar Rate, or is otherwise unable to determine
the Eurodollar Rate at any time, the right of the Borrower to select,
continue or convert the Term Loan to the Eurodollar Rate shall be suspended
until the Agent shall notify Borrower that the circumstances causing such
suspension no longer exist, and the outstanding principal balance of the
Term Loan shall accrue at the Corporate Base Rate.
Section II.05. Repayment of Term Loans; Application of
---------------------------------------
Payments. The Term Loans in the aggregate shall be due and payable and
- --------
shall be repaid by the Borrower as follows:
(1) Beginning August 1, 1996, and on the 1st day of each
November, February, May and August thereafter until May 1, 2000, Borrower
shall pay quarterly installments of principal in the amount of Two Million
Five Hundred Thousand Dollars ($2,500,000) each;
(2) On the Term Loan Maturity Date, Borrower shall pay all
unpaid principal and accrued and unpaid interest under the Term Loan.
9
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Section II.06. Optional Prepayment.
-------------------
(1) If the outstanding balance of the Revolving Notes
hereunder is zero ($00.00), the Borrower, upon five (5) Business Days prior
written notice to the Agent, may prepay the Term Loan in whole or in part,
without premium or penalty, by paying the principal amount to be prepaid
together with accrued and unpaid interest thereon to the date of prepayment;
provided, however, that from time to time, including such times when the
- -------- -------
outstanding balance of the Revolving Notes is greater than zero ($0.00), the
Borrower, upon five (5) Business Days prior written notice to the Agent, may
prepay the Repayment Tranche in whole, but not in part, without premium or
penalty, by paying the principal amount to be prepaid together with accrued
and unpaid interest thereon to the date of prepayment. If Borrower prepays
the Term Loan, or a portion thereof, which is accruing at the Eurodollar
Rate, the Borrower shall compensate the Agent for the account of the Banks
in accordance with Section 11.06(2).
(2) Each notice of prepayment shall specify the date and
amount of such prepayment and that it relates to the Term Loan. Any notice
of prepayment shall be irrevocable. The Agent shall promptly notify the
Banks of its receipt of such notice of prepayment. Each partial prepayment
of the Term Loan (other than prepayments of the Repayment Tranche) shall be
in an aggregate principal amount which is the lesser of (i) the then
outstanding principal balance of the Term Loan, or (ii) Five Hundred
Thousand Dollars ($500,000) and integral multiples of Fifty Thousand Dollars
($50,000) in excess thereof, and shall be applied to the reduction of
principal in the inverse order of maturity. Each prepayment of the
Repayment Tranche shall be in the aggregate principal amount of the
Repayment Tranche and shall be applied to the reduction of principal in the
forward order of maturity.
(3) Amounts prepaid pursuant to this Section 2.06 may not be
reborrowed.
Section II.07. Term Notes. The Term Loan made by each Bank
----------
and the Borrower's obligation to repay such Term Loan shall be evidenced by,
and be payable with interest in accordance with the terms of this Agreement
and a term note of the Borrower payable to the order of that Bank
(collectively, the "Term Notes"). Each Term Note shall (i) be dated the
----------
date hereof, (ii) be in the original principal amount equal to that Bank's
Term Loan Commitment as set forth opposite such Bank's name in Exhibit A,
---------
and (iii) be executed by a duly authorized officer of the Borrower. Each
Bank's Term Note shall be in substantially the form of Exhibit B.
---------
Section II.08. Method of Payment. Borrower shall make each
-----------------
payment under the Term Notes (including prepayments) not later than 12:00
Noon (St. Louis time) on the date when due in lawful money of the United
States to the Agent by wire transfer of federal funds. Upon receipt of such
payment the Agent shall immediately remit to each Bank by wire transfer of
federal funds the amount of the payment received which is due each Bank
under the Term Note held by each Bank or otherwise under this Agreement. In
the event of receipt of funds after 12:00 Noon (St. Louis time) on the date
of payment, the funds shall be deemed to be received on the next Business
Day and the accrual of interest will be calculated accordingly. Whenever
any payment to be made under this Agreement or under the Term Notes shall be
stated to be due on a day which is not a Business Day, the amount of such
payment shall be made on the next succeeding Business Day, the amount of
such payment, in such case, to include all interest and fees accrued to the
date of actual payment.
Section II.09. Use of Term Loan Proceeds. The proceeds of
-------------------------
the Term Loan hereunder shall be used by Borrower to refinance existing
acquisition debt of Borrower. The Borrower will not use any part of such
proceeds for the purposes of: (i) paying dividends on or other distributions
with respect to the capital stock of Borrower; or (ii) purchasing or
carrying any
10
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margin stock within the meaning of Regulation U of the Board of Governors of
the Federal Reserve System or to extend credit to others for the purpose of
purchasing of carrying any such margin stock.
Section II.10. Advances and Payments. The Term Loans shall
---------------------
be made by each of the Banks concurrently. Each payment and prepayment of
the Term Loan and the Term Notes made to the Agent for the account of the
Banks shall be made pro rata on the basis of each Bank's Term Loan
Commitment as set forth in Exhibit A.
---------
Section II.11. Reimbursement.
-------------
Whenever any Bank shall sustain or incur any losses or
out-of-pocket expenses in connection with:
(1) the failure by the Borrower to pay the principal amount of
the Term Loan when due (whether at maturity, by reason of
acceleration, notice of prepayment/termination by Borrower or
otherwise);
(2) the repayment of overdue amounts of the Term Loan; or
(3) the acceleration of the maturity date of the Term Notes by
reason of the occurrence of an Event of Default,
the Borrower shall pay to the Agent, upon its demand and for the
account of the Banks, an amount certified in writing by the Agent as
the amount required to reimburse the Banks and the Agent for all
reasonable losses and out-of-pocket expenses claimed. All
determinations, estimates, assumptions, allocations and the like
required for the determination thereof shall be made by the Agent in
good faith and the Agent's determination thereof shall be final and
binding and conclusive upon the Borrower in the absence of manifest
error.
Section II.12. No Renewal Option. This Agreement may not be
-----------------
extended in relation to the Term Loan made pursuant to this Article
II, irrespective of whether this Agreement shall be extended in
relation to the Revolving Loans pursuant to Article III, except upon
the mutual written consent of the Borrower and each Bank.
ARTICLE III.
AMOUNT AND TERMS OF REVOLVING LOAN AND LETTERS OF CREDIT
--------------------------------------------------------
Section III.01. Commitments. Subject to the terms and
-----------
conditions of this Agreement (including, without limitation, the terms and
conditions of Article IV hereof), the Banks severally and not jointly agree
----------
from time to time on any Business Day during the period from the date of
this Agreement to the Revolving Credit Termination Date to:
(1) make Loans to the Borrower as set forth in Section 3.02
and subject to the terms and conditions of this Agreement; and
(2) issue for the account of the Borrower (in the case of the
Agent) or participate in (in the case of all other Banks) Letters
of Credit as set forth in Sections 3.13 and 3.15 and subject to the
terms and conditions of this Agreement.
11
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Section III.02. Revolving Credit. The Banks, severally and
----------------
not jointly, shall, upon the terms and conditions of this Agreement, make
loans (collectively, the "Revolving Loans") to the Borrower from time to
---------------
time during the period from the date hereof up to but not including the
Revolving Credit Termination Date in individual amounts not to exceed each
Bank's Revolving Loan Commitment as set forth opposite such Bank's name in
Exhibit D, the aggregate principal amount of which at any time shall not
- ---------
exceed Forty Million Dollars ($40,000,000) (the "Revolving Loan Limit") .
--------------------
Any amounts advanced and repaid by Borrower shall be treated as prepayments
and shall be eligible for reborrowing by Borrower in the absence of a
Default or an Event of Default, subject to the terms and conditions of this
Agreement.
Section III.03. Termination or Reduction of Revolving Loan
------------------------------------------
Commitment. The Borrower shall have the right, upon at least fifteen (15)
- ----------
Business Days' notice to the Agent, to terminate in whole or reduce in part
the unused portion of the Revolving Loan Commitment. Any such reduction by
Borrower of the Revolving Loan Commitment shall result in a pro rata
reduction of each Bank's Revolving Loan Commitment.
Section III.04. Interest on Revolving Loans. The Borrower
---------------------------
shall pay interest on the outstanding and unpaid principal amount of the
Revolving Loans made under this Agreement at the following intervals and at
the following rates per annum:
(1) Corporate Base Rate. If such Revolving Loan is accruing
-------------------
at the Corporate Base Rate, a fluctuating rate per annum equal to the
Corporate Base Rate in effect from time to time. Any change in the
interest rate resulting from a change in the Corporate Base Rate shall
become effective as of the opening of business on the day on which such
change in the Corporate Base Rate shall become effective. Interest shall
be calculated on the basis of the actual number of days elapsed over a
year of 360 days. Interest shall be paid in the immediately available
funds on or before 12:00 Noon (St. Louis time) on the first day of each
calendar month beginning August 1, 1996, and on the Revolving Credit
Termination Date. In the event of receipt of funds after 12:00 Noon (St.
Louis time) on the date of payment, the funds shall be deemed to be
received on the next Business Day, and the accrual of interest will be
calculated accordingly;
(2) Eurodollar Rate. If such Revolving Loan is accruing at the
---------------
Eurodollar Rate, a rate per annum equal at all times during the applicable
Interest Period for such Revolving Loan to the sum of the Eurodollar Rate
for such Interest Period plus one and one-quarter percent (1.25%) per
annum, payable on the first day of each calendar month and on the
Revolving Credit Termination Date. Interest shall be calculated on the
basis of the actual number of days elapsed over a year of 360 days.
Interest shall be paid in the immediately available funds on or before
12:00 Noon (St. Louis time) on the first day of each calendar month
beginning August 1, 1996 and on the Revolving Credit Termination Date. In
the event of receipt of funds after 12:00 Noon (St. Louis time) on the
date of payment, the funds shall be deemed to be received on the next
Business Day, and the accrual of interest will be calculated accordingly;
provided, however, that, from and after the occurrence of an Event of
-------- -------
Default and unless and until such Event of Default is waived, the Borrower
shall pay interest on the unpaid principal amount of the Revolving Loan at
a rate per annum equal at all times to four percent (4%) per annum above
the interest rate otherwise in effect from time to time with respect to
each Revolving Loan then outstanding, such interest being payable on
demand. The Agent shall give prompt notice to the Borrower and the Banks
of the applicable interest rate determined by the Agent for purposes of
this Section 3.04.
12
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Section III.05. Notice and Manner of Borrowing.
------------------------------
(1) The Borrower shall give the Agent (who shall promptly
notify the Banks) telephonic notice (followed immediately by written or
telex notice) of any request for a Revolving Loan under this Agreement at
least five (5) Business Days before each Revolving Loan, specifying (i) the
date, purpose and amount thereof, and (ii) the interest rate applicable to
such Revolving Loan. Such notice of borrowing (a "Notice of Borrowing")
-------------------
shall be substantially in the form of Exhibit F hereto. Each such request
---------
shall be accompanied by a Compliance Certificate (the "Certificate") in the
-----------
form of Exhibit H hereto. At least three (3) Business Days before the end
---------
of each Interest Period, the Borrower shall give the Agent (who shall
promptly notify the Banks) a Notice of Borrowing with respect to the
relevant Revolving Loan accruing at the Eurodollar Rate specifying the new
Interest Period or, in the event that the relevant Revolving Loan is to
accrue at the Corporate Base Rate, specifying the same. In the event that
in any Notice of Borrowing hereunder the interest rate of the Revolving Loan
to be advanced is not specified (or if Borrower is not entitled to request a
Eurodollar Rate loan pursuant to the terms hereof), the Revolving Loan to be
advanced shall accrue at the Corporate Base Rate. Each Revolving Loan shall
be in an amount of at least One Million Dollars ($1,000,000) and integral
multiples of One Hundred Thousand Dollars ($100,000) in excess thereof or,
if less, the unused amount of the Revolving Loan Commitment. Not later than
2:00 P.M. (St. Louis time) on the date of such Revolving Loan and upon
fulfillment of the applicable conditions set forth herein, the Banks via the
Agent will make such Revolving Loan available to the Borrower in immediately
available funds by wire transfer of federal funds to the Borrower. Upon the
request (in writing) of the Borrower, the Agent and the Banks shall use
their reasonable best efforts to make such Revolving Loans available to the
Borrower prior to 2:00 P.M. (St. Louis time), provided, however, neither the
-------- -------
Agent nor the Banks shall have any liability to the Borrower or any other
Person for any failure to provide such funds prior to 2:00 P.M. (St. Louis
time) pursuant to such request. All notices given under this Section 3.04
shall be irrevocable, and telephonic notices shall be given not later than
11:00 A.M. (St. Louis time) on the day which is not later than the number of
Business Days specified above for such notice. If a Default or Event of
Default exists hereunder, the Borrower shall not have the right to request a
Eurodollar Rate of interest, the then current interest rate with respect to
Revolving Loans then accruing at the Eurodollar Rate (if after the
occurrence of an Event of Default) shall be revised to be the Eurodollar
Rate plus five and one-quarter percent (5.25%) (as set forth in Section
3.04), and at the end of an Interest Period if such Default or Event of
Default still exists, a Revolving Loan accruing at the Eurodollar Rate shall
immediately and automatically, and without necessity of any further act by
the Borrower, the Banks or the Agent be refinanced by a Revolving Loan
accruing at the Corporate Base Rate (plus four percent (4%) if after the
occurrence of an Event of Default) in the same principal amount, and any
costs and expenses incurred by virtue of such refinancing (including without
limitation the costs and expenses identified in Section 11.06(2)) shall be
promptly paid by Borrower to the Agent on the demand of the Agent, and all
the Revolving Loans shall thereafter accrue at the Corporate Base Rate (plus
four percent (4%) if after the occurrence of an Event of Default).
(2) Anything in subsection (1) above to the contrary
notwithstanding,
(a) if the Agent shall notify the Borrower that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or that any central bank or other governmental
authority asserts that it is unlawful, for the Agent or any of the Banks to
perform its obligations hereunder with respect to the making of a Revolving
Loan accruing at the Eurodollar Rate or to fund or maintain a Revolving Loan
at the Eurodollar Rate hereunder, the right of the Borrower to select,
continue or convert a Revolving Loan to the Eurodollar Rate shall be
suspended until the Agent shall notify the Borrower that the circumstances
causing such
13
21
suspension no longer exist, and the outstanding Revolving Loans accruing at
the Eurodollar Rate shall immediately and automatically upon the sending of
such notice and without the necessity of any further act by the Borrower, the
Banks or the Agent be refinanced by Revolving Loans in the same principal
amount, and any costs and expenses incurred by virtue of such refinancing
(including without limitation the costs and expenses identified in Section
11.06(2)) shall be promptly paid by Borrower to the Agent on the demand of the
Agent and all of the Revolving Loans shall thereafter accrue at the Corporate
Base Rate;
(b) if the Agent is unable, after reasonable efforts,
due to prevailing market conditions, to provide timely information for the
determination of the Eurodollar Rate, or is otherwise unable to determine
the Eurodollar Rate at any time, the right of the Borrower to select,
continue or convert a Revolving Loan to the Eurodollar Rate shall be
suspended until the Agent shall notify Borrower that the circumstances
causing such suspension no longer exist, and the requested Revolving Loan
shall accrue at the Corporate Base Rate; and
(c) if, at any time, five (5) or more Revolving Loans
are accruing at an interest rate based upon the Eurodollar Rate with
Interest Periods ending on different days, Borrower shall not have the right
to select the Eurodollar Rate as the interest rate applicable to any new
Revolving Loan or convert the interest rate applicable to an existing
Revolving Loan from the Corporate Base Rate to the Eurodollar Rate.
(3) The Notice of Borrowing shall be irrevocable and binding
on the Borrower. In the case of a Notice of Borrowing which specifies a
request for a Eurodollar Rate of interest, the Borrower shall indemnify the
Agent and the Banks against any loss, reasonable costs or expense incurred
by the Agent and/or the Banks as a result of any failure to fulfill on or
before the date specified in the Notice of Borrowing as the date of the
Revolving Loan the applicable conditions set forth in Article IV, including,
without limitation, any loss (including loss of anticipated profits), cost
or expense incurred by reason of the liquidation or reemployment of deposits
or other funds acquired by the Agent and/or the Banks to fund the Eurodollar
Rate of interest when such Revolving Loan, as a result of such failure, is
not made on such date.
Section III.06. Revolving Notes. The Revolving Loan made by
---------------
each Bank and the Borrower's obligation to repay such Revolving Loan shall
be evidenced by, and be payable with interest in accordance with the terms
of, this Agreement and a revolving note of the Borrower payable to the order
of that Bank (collectively, the "Revolving Notes"). Each Revolving Note
---------------
shall (i) be dated the date hereof, (ii) be in the original principal amount
equal to that Bank's Revolving Loan Commitment as set forth opposite such
Bank's name in Exhibit D, and (iii) be executed by duly authorized officers
---------
of the Borrower. Each Bank's Revolving Note shall be in substantially the
form of Exhibit E. The failure of any Bank to make a Revolving Loan shall
---------
not relieve any other Bank of its obligation to make a Revolving Loan
pursuant to the terms and conditions of this Agreement. When used in this
Agreement, the term "Revolving Note" or "Revolving Notes" shall include any
extensions, modifications, renewals, refundings, replacements or
restatements thereof.
Section III.07. Method of Payment. Borrower shall make each
-----------------
payment under this Agreement and under the Revolving Notes not later than
12:00 Noon (St. Louis time) on the date when due in lawful money of the
United States to the Agent by wire transfer of federal funds. Upon receipt
of such payment the Agent shall immediately remit to each Bank by wire
transfer of federal funds the amount of the payment received which is due
each Bank under the Revolving Note held by each Bank or otherwise under this
Agreement. In the event of receipt of funds after 12:00 Noon (St. Louis
time) on the date of payment, the funds shall be deemed to be received on
the next Business Day and the accrual of interest will be calculated
accordingly. Whenever any payment to be made under this Agreement or under
a Revolving Note shall be stated to be due on a
14
22
day which is not a Business Day, such payment shall be made on the next
succeeding Business Day, the amount of such payment, in such case, to include
all interest or fees accrued to the date of actual payment.
Section III.08. Use of Proceeds. The proceeds of the
---------------
Revolving Loans hereunder shall be used by Borrower to finance the
acquisition by Borrower of banks and thrift institutions and their holding
companies, including, without limitation, the refinancing of existing
indebtedness of the Borrower incurred in connection with prior bank and bank
holding company acquisitions. The Borrower will not, directly or
indirectly, use any part of the proceeds of the Revolving Loans for the
purpose of: (i) paying dividends on or other distributions with respect to
capital stock of Borrower; (ii) paying interest on outstanding debt of
Borrower; or (iii) purchasing or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System or to extend credit to others for the purpose of purchasing or
carrying any such margin stock.
Section III.09. Zero Balance. The Banks and the Borrower
------------
acknowledge that the outstanding balance of the Revolving Notes may be zero
($00.00) from time to time, and that prior to the Revolving Credit
Termination Date such fact shall not mean the Revolving Loan Commitment and
the availability of the Revolving Loans have been terminated.
Section III.10. Advances and Payment. The Revolving Loans
--------------------
shall be made by each of the Banks concurrently. Each payment and
prepayment of the Revolving Loans made to the Agent for the account of the
Banks shall be made pro rata on the basis of each Bank's Revolving Loan
Commitment as set forth in Exhibit D. If the Borrower prepays any Revolving
---------
Loan or a portion thereof which is accruing at the Eurodollar Rate, the
Borrower shall compensate the Banks in accordance with Section 11.06(2).
Any such prepayment shall be made upon at least three (3) Business Days'
notice to the Agent stating the proposed date and aggregate principal amount
of the prepayment, and if such notice is given, the Borrower shall prepay
such principal amount of the Revolving Loan together with accrued interest
to the date of such prepayment on the principal amount prepaid; provided,
--------
however, that each partial prepayment shall be in an aggregate principal
- -------
amount of not less than One Hundred Thousand Dollars ($100,000) and integral
multiples of Fifty Thousand Dollars ($50,000) in excess thereof, and
provided further, that a partial prepayment shall not reduce the principal
- ----------------
balance of each Revolving Loan below the minimum levels prescribed in
Section 3.05. In the event more than one Revolving Loan accruing at the
Eurodollar Rate is outstanding at the time of any such prepayment, the
Borrower shall have the right to specify which such Revolving Loan is to be
prepaid by the Borrower.
Section III.11. Revolving Loan Commitment Fee. Borrower shall
-----------------------------
pay to Agent for the account of the Banks on a pro-rata basis, within twenty
(20) days from the date of the Agent's invoice therefor, a Revolving Loan
Commitment Fee (the "Revolving Loan Commitment Fee") at the rate of
-----------------------------
one-eighth of one percent (0.125%) per annum on the average daily unused
portion of the Revolving Loan Commitment. The Revolving Loan Commitment Fee
shall be payable quarterly in arrears commencing on November 1, 1996 (which
payment shall include the period commencing on the date hereof), February 1,
1997, May 1, 1997 and on the Revolving Credit Termination Date. The
Revolving Loan Commitment Fee shall be computed on the basis of a year
deemed to consist of 360 days and paid for the actual number of days
elapsed. The amount of Revolving Loans outstanding from time to time and
the amount of Letter of Credit Outstandings from time to time are considered
uses of the Revolving Loan Commitment.
Section III.12. Reimbursement.
-------------
15
23
Whenever any Bank shall sustain or incur any losses or
out-of-pocket expenses in connection with:
(1) the failure by the Borrower to pay the principal amount of
any Revolving Loan when due (whether at maturity, by reason of acceleration,
notice of prepayment/termination by Borrower or otherwise);
(2) the repayment of overdue amounts of any Revolving Loan;
(3) the acceleration of the maturity date of any Revolving
Note by reason of the occurrence of an Event of Default; or
(4) the failure by Borrower to make any payment to the Agent
with respect to any Letter of Credit when due;
the Borrower shall pay to the Agent, upon its demand and for the account of
the Banks, an amount certified in writing by the Agent as the amount
required to reimburse the Banks for all reasonable losses and out-of-pocket
expenses claimed. All determinations, estimates, assumptions, allocations
and the like required for the determination thereof shall be made by the
Agent in good faith and the Agent's determination thereof shall be final and
binding and conclusive upon the Borrower in the absence of manifest error.
Section III.13. Agreement to Issue Letters of Credit.
------------------------------------
(1) From and including the date hereof to but excluding the
Revolving Credit Termination Date, the Banks severally agree, on the terms
and conditions set forth in this Agreement, that the Borrower from time to
time may request that the Agent issue for the account of the Borrower and in
support of certain obligations of the Borrower to the former shareholders of
St. Charles Federal Bancshares, Inc. arising out of that certain Agreement
and Plan of Reorganization dated March 28, 1994 (the "Agreement and Plan of
---------------------
Reorganization") by and among the Borrower, St. Charles Federal Bancshares
- --------------
Inc. and St. Charles Acquisition Company, on an offering and as available
basis, one or more irrevocable standby letters of credit (each a "Letter of
---------
Credit") in substantially the form attached hereto as Exhibit I and in an
- ------
aggregate Stated Amount not to exceed $1,136,777.28.
For purposes of this Agreement, those currently outstanding letters of
credit described on Schedule 3.13 hereof shall be deemed to be Letters of
-------------
Credit requested by the Borrower under the terms hereof.
(2) The Agent hereby agrees that during the period from and
including the date hereof to but excluding the Revolving Credit Termination
Date, it will, following receipt by the Agent of a Letter of Credit Request,
subject to Article IV hereof, issue Letters of Credit (in substantially the
form attached hereto as Exhibit I), provided that the Agent shall not be
---------
under any obligation to issue any Letter of Credit if at the time of such
issuance:
(a) any order, judgment or decree of any governmental
authority or arbitrator shall purport by its terms to enjoin or restrain the
Agent from issuing such Letter of Credit or any requirement of law
applicable to the Agent or any request or directive (whether or not having
the force of law) from any governmental authority with jurisdiction over the
Agent shall prohibit, or request that the Agent refrain from, the issuance
of letters of credit generally or such Letter of Credit in particular or
shall impose upon the Agent with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which the Agent is not
otherwise
16
24
compensated) not in effect on the date hereof, or any unreimbursed loss, cost
or expense which was not applicable, in effect or known to the Agent as of the
date hereof and which the Agent deems material to it;
(b) the Agent shall have received notice from any Bank
prior to the issuance of such Letter of Credit of the type described in the
last sentence of Section 3.14(2);
(c) after giving effect to such issuance, the sum of the
aggregate amount of Revolving Loans outstanding plus the amount of Letter of
Credit Outstandings would exceed the aggregate amount of the Revolving Loan
Commitment; or
(d) the Agent shall have received notice of a default by
any party under the Agreement and Plan of Reorganization.
Section III.14. Letter of Credit Requests.
-------------------------
(1) Whenever the Borrower wishes a Letter of Credit to be
issued for its account, it shall give the Agent (who shall promptly notify
the Banks) at least ten (10) Business Days' prior written request therefor.
Each such request shall include all of the information required by Exhibit J
---------
and shall be in writing and executed by the Borrower and shall include a
completed letter of credit application on the form customarily used by the
Agent for similar transactions (each, a "Letter of Credit Request").
------------------------
(2) The making of each Letter of Credit Request shall be
deemed to be a representation and warranty by the Borrower that such Letter
of Credit may be issued in accordance with, and will not violate the
requirements of, Section 3.13 and that each of the applicable conditions
specified in Article IV has been satisfied. Unless the Agent receives a
notice from any Bank prior to its issuance of a Letter of Credit that one or
more of the applicable conditions specified in Article IV are not then
satisfied, or that the issuance of such Letter of Credit would violate
Section 3.13, the Agent may issue the requested Letter of Credit for the
account of the Borrower in accordance with its customary practices.
Section III.15. Letter of Credit Participation.
------------------------------
(1) Immediately upon the issuance by the Agent of any Letter
of Credit (or any amendment with respect to a previously issued Letter of
Credit) pursuant to this Article III and without further action, the Agent
shall be deemed to have sold and transferred to each Bank, and each Bank
shall be deemed irrevocably and unconditionally to have purchased and
received from the Agent, pro rata on the basis of each Bank's Revolving Loan
Commitment as set forth in Exhibit D, without recourse or warranty, an
---------
undivided interest and participation in such Letter of Credit of the Agent,
any substitute letter of credit with respect thereto, each drawing made
thereunder (each a "Drawing") and the obligations of the Borrower under this
-------
Agreement with respect thereto, and any security therefor (a "Letter of
---------
Credit Participation").
- --------------------
(2) In determining whether to make a payment under any Letter
of Credit, the Agent shall have no obligation to the Banks other than to
confirm that the documents required to be delivered under such Letter of
Credit appear to have been delivered and to comply on their face with the
terms and conditions of such Letter of Credit. No action taken or omitted
to be taken by the Agent in good faith under or in connection with any
Letter of Credit, shall result in liability of the Agent to any Bank in the
absence of gross negligence or willful misconduct by the Agent.
17
25
(3) In the event that the Borrower shall not reimburse in full
pursuant to Section 3.16 any amount paid by the Agent, the Agent shall
notify each Bank and each Bank shall promptly and unconditionally pay to the
Agent for the account of the Agent, the amount of such Bank's ratable share
of such unreimbursed payment pro rata on the basis of each Bank's Revolving
Loan Commitment as set forth in Exhibit D in dollars and in same day funds.
---------
If the Agent so notifies any Bank prior to 12:00 Noon (St. Louis time) on
any Business Day, such Bank shall make available to the Agent such Bank's
proportionate ratable share of the amount of such payment on such Business
Day in same day funds. If and to the extent any such Bank shall not make
such amount available to the Agent on a timely basis, such Bank agrees to
pay to the Agent, forthwith on demand such amount (together with interest
thereon for each day from such date until the date such amount is paid to
the Agent at the Federal Funds Rate). The failure of any Bank to make
available to the Agent its ratable share of any payment under any Letter of
Credit shall not relieve any other Bank of its obligations hereunder;
provided, however, that no Bank shall be responsible for the failure of any
- -------- -------
other Bank to make available to the Agent such other Bank's ratable share of
any such payment.
(4) Whenever the Agent receives any payment, by or on behalf
of the Borrower, of or in connection with a reimbursement obligation for
which the Agent received payments from the Banks pursuant to clause (3)
above, the Agent shall pay to each Bank which paid its ratable share
thereof, in dollars and in same day funds, an amount equal to such Bank's
ratable share. If and to the extent the Agent shall not make such amount
available to the Bank on a timely basis, the Agent agrees to pay to such
Bank forthwith on demand, such amount together with interest thereon (for
each day from such date until the date such amount is paid to such Bank, at
the Federal Funds Rate).
(5) The obligations of the Banks to make payments to the Agent
with respect to Letters of Credit shall be irrevocable and not subject to
any qualification or exception whatsoever and shall be made in accordance
with the terms and conditions of this Agreement under all circumstances,
including, without limitation, any of the following circumstances:
(a) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(b) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against a beneficiary named in
a Letter of Credit, any transferee of any Letter of Credit (or any Person
for whom any such transferee may be acting), any Bank, or any other Person,
whether in connection with this Agreement, any Letter of Credit, the
transactions contemplated herein or any unrelated transactions (including
any underlying transaction between the Borrower and the beneficiary named in
any such Letter of Credit);
(c) any draft, certificate or any other document
presented under the Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(d) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan Documents;
or
(e) the occurrence of any Default or Event of Default.
18
26
Section III.16. Agreement to Repay Letter of Credit Drawings.
--------------------------------------------
(1) The Agent shall notify the Borrower of any payment made by
the Agent under any Letter of Credit issued by it. The Borrower hereby
agrees to reimburse the Agent, by making payment in immediately available
funds to the Agent, for any payment made by the Agent under any Letter of
Credit issued by it (each such amount so paid until reimbursed, an "Unpaid
------
Drawing") immediately after, and in any event on the date of, such payment,
- -------
with interest on the amount so paid by the Agent, to the extent not reimbursed
prior to 12:00 Noon (St. Louis time) on the date of such payment, from and
including the date paid to but excluding the date reimbursement is
made as provided above, at a rate per annum which shall be the Corporate
Base Rate in effect from time to time (4.0% in excess of the Corporate Base
Rate in effect from time to time if not reimbursed by 12:00 Noon (St. Louis
time) on the fifth (5th) Business Day following any such payment), such
interest to be payable on demand. The failure by the Borrower to pay an
Unpaid Drawing on or prior to the fifth (5th) Business Day following the
date on which notice of such Drawing was provided to the Borrower by the
Agent shall constitute an Event of Default.
(2) Borrower hereby indemnifies and holds the Agent and the
Banks harmless from and against any and all claims, damages, losses,
liabilities, costs or expenses whatsoever, which the Agent or any Bank may
incur (or which may be claimed against the Agent or any Bank by any Person
or entity whatsoever) by reason of or in connection with the execution and
delivery or transfer of or payment or failure to pay under any Letter of
Credit exclusive of the gross misconduct or wilful failure of the Agent or
any Bank (except when prohibited by law) to pay under any Letter of Credit
after presentation by the beneficiary thereof of a request complying with
the terms and conditions of the relevant Letter of Credit. Borrower assumes
all risks of the acts or omissions of any beneficiary of any Letter of
Credit and neither the Agent nor any Bank (nor any officer or director of
the Agent or any Bank) shall be liable or responsible for (a) the use which
may be made of any Letter of Credit or for any acts or omissions of any
beneficiary in connection therewith, (b) the validity, sufficiency or
genuineness of documents or of any endorsement thereon presented in
connection with any Letter of Credit, even if such documents or endorsements
should in fact prove to be in any or all respects invalid, fraudulent or
forged, or (c) payment in good faith by the Agent against presentation of
documents which do not comply with the terms of the relevant Letter of
Credit, including any failure of any documents to bear any reference or
adequate reference to the relevant Letter of Credit. In furtherance and not
in limitation of the foregoing, the Agent in making payment under a Letter
of Credit may accept documents that appear on their face to be in order,
without responsibility for further investigation, regardless of any notice
or information to the contrary. The Borrower's obligations under this
Section 3.16 to reimburse the Agent with respect to drawings under the
Letters of Credit (including, in each case, interest thereon) shall be
absolute, unconditional and irrevocable and shall be satisfied strictly in
accordance with the terms of this Agreement under all circumstances
whatsoever, including, without limitation, the following:
(a) any lack of validity or enforceability of a Letter
of Credit; or
(b) any amendment or waiver or any consent to departure
from the terms of a Letter of Credit or any other agreement or instrument
relating thereto; or
(c) the existence of any claim, setoff, defense or right
which the Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any persons or entities for whom any
such beneficiary or any such transferee may be acting), the Agent or any
Bank or any other person or entity, whether in connection with this
Agreement or any unrelated transaction; or
19
27
(d) any statement or any other document presented under
a Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect
whatsoever; or
(e) payment by the Agent under a Letter of Credit
against presentation of a request which on its face appears to be in
accordance with the terms of the same.
Section III.17. Notice of Letter of Credit Outstandings.
---------------------------------------
Within twenty (20) days of (i) each issuance of a Letter of Credit
hereunder, or (ii) each drawing under, termination of, or other change in
the amount of, a Letter of Credit outstanding hereunder, the Agent shall
notify the Borrower and the Banks, in accordance with Section 11.03 hereof,
of the Letter of Credit Outstandings in respect of Letters of Credit issued
by it by delivering to the Borrower and the Banks a Letter of Credit usage
status report setting forth a list of each Letter of Credit, and the balance
of Letter of Credit Outstandings.
Section III.18. Deemed Disbursements; Cash Collateralization.
--------------------------------------------
(1) Upon the occurrence and during the continuation of an
Event of Default, then:
(a) automatically in the case of an Event of Default
described in Section 9.01(5), and at the election of the Majority in the
case of any other Event of Default described in Section 9.01, an amount
equal to that portion of the Letter of Credit Outstandings attributable to
the then aggregate amount which is undrawn and available under all
outstanding Letters of Credit shall, without demand upon or notice to the
Borrower, be deemed to have been paid or disbursed by the Agent
(notwithstanding that such amount may not in fact have been so paid or
disbursed); and
(b) upon notification by the Agent to the Borrower of
its obligations under this Section 3.18, the Borrower shall be immediately
obligated to reimburse the Agent for the amount deemed to have been so paid
or disbursed by the Agent.
Any amounts so payable by the Borrower pursuant to this Section 3.18(1)
shall be deposited in cash with the Agent and held as collateral security
for the obligations of Borrower in connection with any Letter of Credit. At
such time when the Event of Default shall have been cured or waived, the
Agent shall return to the Borrower all amounts then on deposit with the
Agent pursuant to this Section 3.18(1) net of any amounts applied to the
payment of any Drawings.
(2) If on the Revolving Credit Termination Date any Letter of
Credit shall be outstanding, then the Borrower shall, at the Borrower's
election, either (i) immediately deposit cash with the Agent in an amount
equal to the L/C Coverage Requirement, which cash shall be held by the Agent
as collateral security for the obligations of Borrower in connection with
any Letter of Credit, or (ii) cause a letter of credit to be issued in favor
of the Agent as beneficiary in an amount equal to the L/C Coverage
Requirement for each such Letter of Credit, in such form and substance and
issued by such bank as may be acceptable to the Agent in its sole
discretion.
Section III.19. Failure of Any Bank to Make Revolving Loans or
---------------------------------------------
Participate in Letters of Credit. Should any Bank default in (i) making a
- --------------------------------
Revolving Loan, or (ii) participating in a Letter of Credit required to be
made or participated in by the terms of this Agreement, the other Banks
shall not be released from their several obligations to make Revolving Loans
and/or participate in Letters of Credit as agreed hereunder, and, in the
event such defaulting Bank is the Agent, the other Banks shall forthwith
appoint one of themselves to act as Agent. However, such
20
28
default shall not obligate any of the Banks to increase their Revolving Loan
Commitment hereunder. As liquidated damages for such default, Borrower shall
be released from all liability to pay such defaulting Bank any accrued or
future fees under Sections 3.05, 3.11 and 3.20 and this Agreement as to such
defaulting Bank shall thereupon be terminated until such default is cured,
except only to the extent and for the protection of Revolving Loans and
participation in Letters of Credit theretofore made or incurred by such
defaulting Bank which remain outstanding.
Section III.20. Letter of Credit Fees.
---------------------
(1) The Borrower agrees to pay to the Agent in respect of each
Letter of Credit issued for the account of the Borrower (including, without
limitation, the Letters of Credit described on Schedule 3.13 hereof), a fee
-------------
(the "Letter of Credit Fee"), for the period from and including the date of
--------------------
issuance of such Letter of Credit to and including the date of termination
thereof: (a) in respect of each Letter of Credit issued hereunder, computed
at a rate of 1.25% per annum on the Stated Amount of such Letter of Credit;
and (b) in respect of the Letters of Credit described on Schedule 3.13
hereof and any extension, renewal or reissuance thereof, computed at a rate
of 1.50% per annum on the Stated Amount of such Letters of Credit. Letter
of Credit Fees shall be due and payable quarterly in advance on the date of
issuance of such Letter of Credit and on the last day of each September,
December, March and June thereafter until the date of termination thereof
(each, other than the date of issuance, a "Letter of Credit Fee Payment
----------------------------
Date"), on the basis of the then Stated Amount of such Letter of Credit and
- ----
on the date of termination thereof. The Letter of Credit Fee payable on the
date of issuance of a Letter of Credit shall be in an amount equal to the
Letter of Credit Fee applicable to such Letter of Credit on the basis of the
then Stated Amount for the period from the date of issuance of such Letter
of Credit to the next occurring Letter of Credit Fee Payment Date. In the
event subsequent occurrences reduce the amount or duration of the Banks'
liability under a Letter of Credit below the amount or duration used in
making the above calculations, the Agent and each Bank will credit to
Borrower, on the next to occur of a Letter of Credit Fee Payment Date or the
Revolving Credit Termination Date, the appropriate portion of the Letter of
Credit Fee received by such party if the amount refundable by such Bank or
the Agent exceeds $100. With respect to Letter of Credit Fees paid to the
Agent, a portion of such fees in an amount equal to 1.0% per annum (1.25%
per annum in respect of Letters of Credit described on Schedule 3.13 hereof
and any extension, renewal or reissuance thereof) on the Stated Amount of
such Letter of Credit, and any interest paid by the Borrower to the Agent
pursuant to Section 3.16(1) hereof, shall be deemed to be paid by the
Borrower to the Agent for the account of the Banks, to be distributed by the
Agent to the Banks pro rata on the basis of each Bank's Revolving Loan
Commitment as set forth in Exhibit D. The remaining balance of such Letter
---------
of Credit Fees shall be retained by the Agent. The Letter of Credit Fees
shall be computed on the basis of a year deemed to consist of 360 days and
paid for the actual number of days elapsed.
(2) The Borrower hereby agrees to pay on demand to the Agent
an issuance fee with respect to each Letter of Credit in the amount of
Seventy-Five Dollars ($75). The Borrower further agrees to pay on demand to
the Agent a negotiation fee with respect to each drawing or request for a
drawing under a Letter of Credit in the amount of One Hundred Dollars
($100). Any payments made to the Agent pursuant to this Section 3.20(2)
shall be retained by the Agent.
All fees payable by the Borrower under this Section 3.20 shall be paid by
the Borrower to the Agent within twenty (20) days from the date of the
Agent's invoice therefor.
Section III.21. Banks Not Required to Extend Credit. No Bank
-----------------------------------
shall be required to make any Revolving Loan or issue or participate in any
Letter of Credit if, after giving effect thereto, the then aggregate
outstanding principal amount of all Revolving Loans plus the then
21
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aggregate amount of all Letter of Credit Outstandings relative to all Banks
would exceed $40,000,000, as such amount may be reduced from time to time
pursuant to Section 3.03, or such Bank would exceed its Revolving Loan
Commitment (after giving effect to all Revolving Loans, whether or not funded
by any particular Bank, as if each Bank had funded its respective Revolving
Loans in accordance with the terms of this Agreement).
ARTICLE IV.
CONDITIONS PRECEDENT
--------------------
Section IV.01. Conditions Precedent to the Term Loans and
------------------------------------------
Initial Revolving Loans. The obligation of each Bank to make its Term Loan
- -----------------------
and initial Revolving Loan to the Borrower and the obligation of the Agent
to issue the initial Letters of Credit are subject to the conditions
precedent that the Agent, on behalf of the Banks, shall have received, on or
before the date hereof, each of the following:
(1) Notes. The Term Notes and Revolving Notes duly executed
-----
by the Borrower;
(2) Pledge Agreement. The Pledge Agreement, duly executed by
----------------
the Borrower, together with (a) acknowledgment copies of the financing
statements (Form UCC-1) duly filed under the Uniform Commercial Code of all
jurisdictions necessary or, in the opinion of the Agent, desirable to
perfect the security interest created by the Pledge Agreement, and (b) stock
powers or powers of attorney which are necessary or appropriate for the
security interest of the Agent in the Collateral;
(3) Subsidiary Pledge Agreements. Each of the Subsidiary
----------------------------
Pledge Agreements, duly executed by CCB Bancorp, Inc. and River Valley
Holdings, Inc., together with (a) acknowledgment copies of the financing
statements (Form UCC-1) duly filed under the Uniform Commercial Code of all
jurisdictions necessary or, in the opinion of the Agent, desirable to
perfect the security interest created by each of the Subsidiary Pledge
Agreements, and (b) stock powers or powers of attorney which are necessary
or appropriate for the security interest of the Agent in the Collateral;
(4) Evidence of all Corporate Action by the Borrower and
----------------------------------------------------
Subsidiaries. Certified (as of the date of this Agreement) copies of all
- ------------
corporate action taken by the Borrower and the Subsidiaries which are
parties to the Subsidiary Pledge Agreements, including resolutions of the
Board of Directors of Borrower and the Subsidiaries which are parties to the
Subsidiary Pledge Agreements, authorizing the execution, delivery, and
performance of all Loan Documents to which Borrower and/or such Subsidiaries
is a party and each other document to be delivered by Borrower and/or such
Subsidiaries pursuant to this Agreement;
(5) Incumbency Certificates of the Borrower. A certificate
---------------------------------------
dated as of the date of this Agreement of the Secretary of Borrower
certifying the names and true signatures of the officers of the Borrower
authorized to sign the Loan Documents and each other document to be
delivered by the Borrower under this Agreement;
(6) Opinion of Counsel for the Borrower. A favorable opinion
-----------------------------------
of counsel for the Borrower, in substantially the form of Exhibit K, and as
---------
to such other matters as the Agent may reasonably request;
22
30
(7) Form U-1. Federal Reserve Form U-1 Purpose Statement,
--------
executed by Borrower;
(8) Share Certificates. Delivery to Agent of the original
------------------
stock certificates for all of the issued and outstanding shares of stock of
each Pledged Subsidiary (exclusive of directors' qualifying shares),
together with stock powers;
(9) Corporate Existence. Certificates and certified copies of
-------------------
charters and articles of incorporation demonstrating the due organization
and current good standing of Borrower and each Pledged Subsidiary and
certified copies of the Bylaws of Borrower and each Pledged Subsidiary;
(10) Watch List. The current Watch List;
----------
(11) Additional Documentation. Such other approvals, opinions
------------------------
or documents as the Agent may reasonably request; and
(12) Termination of Existing Secured Credit Agreement. The
------------------------------------------------
existing Secured Credit Agreement dated as of July 14, 1995 among the
Borrower, the Agent and the banks named as parties thereto shall, concurrent
with the funding of the Term Loans, be refinanced in its entirety and all
funding costs (including any additional losses, costs or expenses incurred
by such banks as a result of such refinancing occurring on other than the
last day of an interest period) payable by Borrower under such Agreement
shall have been paid in full.
Section IV.02. Conditions Precedent to All Revolving Loans.
-------------------------------------------
The obligation of each Bank to make each Revolving Loan (including the
initial Revolving Loans) shall be subject to the further conditions
precedent that on the date of each such Revolving Loan:
(1) The Agent shall have received the Notice of Borrowing
which shall specify whether the requested Revolving Loan shall accrue at the
Eurodollar Rate or Corporate Base Rate;
(2) No Default or Event of Default has occurred and is
continuing, or would result from such Revolving Loan.
(3) The following statements shall be true and the Agent on
behalf of the Banks shall have received a Certificate in substantially the
form of Exhibit H attached, signed by at least two of the chief executive
---------
officer, the chief financial officer, the president, the chief accounting
officer and the chief credit officer of Borrower and dated the date of the
Notice of Borrowing requesting such Revolving Loan, containing the
confirmations of compliance with certain of the financial covenants as
herein provided, and stating that:
(a) The representations and warranties contained in
Article V of this Agreement are correct on and as of such date;
(b) No Default or Event of Default has occurred and is
continuing, or would result from such Revolving Loan;
(c) Attached is an accurate listing of all of the
Affiliates of Borrower; and
(d) The use of the proceeds of the requested Revolving
Loan will be as indicated in the Notice of Borrowing.
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(4) The Agent shall have received such other approvals,
information or documents as the Agent may reasonably request, in form and
substance satisfactory to the Agent.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Banks that:
Section V.01. Incorporation, Good Standing, and Due
-------------------------------------
Qualification. Borrower is a corporation duly incorporated, validly
- -------------
existing and in good standing under the laws of the State of Missouri and is
in good standing in all states and jurisdictions wherein it owns property or
does business requiring such qualification as a foreign corporation.
Borrower is a "bank holding company" as that term is defined in the federal
Bank Holding Company Act of 1956, as amended, 12 U.S.C. ' 1841 et seq., and
-------
as such, Borrower has received all necessary approvals from and has filed
all necessary reports with the Board of Governors of the Federal Reserve
System. The list of Affiliates of Borrower as shown on Exhibit M attached
---------
is as of the date hereof true and accurate. Each Subsidiary of the Borrower
is a bank, savings bank, bank holding company or Missouri corporation duly
organized and in good standing under the laws of its respective jurisdiction
of organization.
Section V.02. Corporate Power and Authority. The execution,
-----------------------------
delivery and performance by the Borrower of the Loan Documents as provided
for herein are within the corporate powers of Borrower, have been duly
authorized by all necessary corporate action and require no action by or in
respect to, or filing with any governmental body, agency or official. The
execution, delivery and performance by Borrower of the Loan Documents do not
conflict with, or result in a material breach of the terms, conditions or
provisions of or constitute a default under or result in any violation of,
and Borrower is not now in default under or in violation of the terms of its
Articles of Incorporation or Bylaws or any rule, regulation, order, writ,
judgment or decree of any court or government agency or instrumentality, or
any agreement or instrument to which Borrower or any of its Subsidiaries is
a party or by which it or they are bound or to which it or they are subject.
To the extent that First Commercial Bancorp, Inc. or First Commercial Bank
is not in compliance with certain financial covenants under a memorandum of
understanding, order or other matter applicable to either or both of such
Subsidiaries, such default has been disclosed to the Agent and the
applicable regulatory agency and does not materially adversely affect the
business or operations of either or both of such Subsidiaries on an
individual basis or of the Borrower and the Subsidiaries on a consolidated
basis.
Section V.03. Legally Enforceable Agreement. This Agreement
-----------------------------
has been duly executed and delivered and constitutes a legal, valid and
binding agreement of the Borrower enforceable in accordance with its terms,
and the other Loan Documents, when executed and delivered in accordance with
this Agreement, will constitute a legal, valid and binding obligation of the
Borrower, enforceable in accordance with their terms. The Subsidiary Pledge
Agreements and the other Loan Documents to which the any Subsidiary is a
party, when executed and delivered in accordance with this Agreement, will
constitute legal, valid and binding obligations of the Subsidiary,
enforceable in accordance with their terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency or other similar laws
affecting creditors' rights generally.
Section V.04. Financial Statements; Financial Condition.
-----------------------------------------
The financial information furnished by Borrower representing the financial
condition of Borrower or any Subsidiary, such information being identified
in Exhibit N attached, is true and correct as of the
---------
24
32
date furnished and there has been no material adverse change in the financial
condition, operations or business of any of them since the date of such
financial information.
Section V.05. Other Agreements. Except for those matters
----------------
disclosed on Schedule 5.05 attached, Borrower is not a party to any
-------------
indenture, loan, or credit agreement, or to any lease or other agreement or
instrument or subject to any charter or corporate restriction which could
have a material adverse effect on its business, properties, assets,
operations, or condition, financial or otherwise, or on its ability to carry
out its obligations under the Loan Documents. Borrower and all Subsidiaries
are not in default in any respect in the performance, observance, or
fulfillment of any of the obligations, covenants, or conditions contained in
any agreement or instrument material to their respective business to which
each is a party.
Section V.06. Litigation. Except for those matters
----------
disclosed on Schedule 5.06 attached, there is no pending or, to the best of
-------------
Borrower's knowledge, threatened action or proceeding against or affecting
Borrower or any Subsidiary before any court, governmental agency, or
arbitrator, which may, in any one case or in the aggregate, materially
affect the financial condition, operations, properties, or business of
Borrower or any Subsidiary, or the ability of Borrower to perform its
obligations under this Agreement or the Loan Documents.
Section V.07. Ownership of Subsidiaries. The ownership of
-------------------------
each Subsidiary is as shown on Exhibit O attached. Upon the extension of
---------
the Term Loan and the initial Revolving Loans, all shares of common stock of
each Subsidiary owned by Borrower will be free and clear of all liens,
claims and encumbrances, except as to Pledged Subsidiaries the security
interests under the Pledge Agreement and the Subsidiary Pledge Agreements as
provided for herein, and except for the pledge of the First Commercial Bank
common stock to Borrower to secure convertible debentures issued by First
Commercial Bancorp, Inc. in an amount not exceed $6,500,000.
Section V.08. ERISA. Borrower and each Subsidiary are in
-----
compliance in all material respects with all applicable provisions of ERISA.
Neither a Reportable Event nor a Prohibited Transaction has occurred and is
continuing with respect to any Plan; except as provided on Schedule 5.08
-------------
attached, no notice of intent to terminate a Plan has been filed nor has any
Plan been terminated; no circumstances exist which constitute grounds under
Section 4042 of ERISA entitling the PBGC to institute proceedings to
terminate, or appoint a trustee to administer, a Plan, nor has the PBGC
instituted any such proceedings; neither Borrower nor any Subsidiary has
completely or partially withdrawn under Sections 4201 or 4204 of ERISA from
a Multiemployer Plan; Borrower and each Subsidiary have met minimum funding
requirements under ERISA with respect to their respective Plans and the
present fair market value of all Plan assets exceeds the present value of
all vested benefits under each Plan, as determined on the most recent
valuation date of the Plan and in accordance with the provisions of ERISA
and the regulations thereunder for calculating potential liability to the
PBGC or the Plan under Title IV of ERISA; Borrower and all Subsidiaries have
incurred no liability to the PBGC under ERISA.
Section V.09. Taxes. Borrower and each Subsidiary have
-----
filed (or received extensions of the time to file) and will in the ordinary
course of business file all tax returns (federal, state, and local) required
to be filed and have paid and will pay all taxes, assessments, and
governmental charges and levies shown thereon to be due, including interest
and penalties, provided, however, that nothing herein will prevent the
-------- -------
contest in good faith of any assessment or imposition of any tax as long as
an adverse determination will have no material adverse impact upon Borrower
or the Pledged Subsidiaries.
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ARTICLE VI.
AFFIRMATIVE COVENANTS
---------------------
So long as any portion of the indebtedness evidenced by the
Notes shall remain unpaid, or the Banks shall have any Commitment under this
Agreement, or any Letter of Credit shall remain outstanding, or any Unpaid
Drawings shall remain unreimbursed by the Borrower, Borrower and each
Pledged Subsidiary will:
Section VI.01. Maintenance of Existence. Preserve and
------------------------
maintain its corporate existence and good standing in the jurisdiction of
its incorporation, and qualify and remain qualified as a foreign corporation
in each jurisdiction in which such qualification is required.
Section VI.02. Maintenance of Records. Keep adequate records
----------------------
and books of account, in which complete entries will be made in accordance
with GAAP consistently applied, reflecting all financial transactions.
Section VI.03. Maintenance of Subsidiaries. Maintain and
---------------------------
keep each Subsidiary in good standing with the jurisdiction of its
organization, except to the extent a Subsidiary dissolves or ceases to exist
pursuant to a transaction permitted by the terms of Section 7.02.
Section VI.04. Compliance With Laws. Comply in all respects,
--------------------
and cause compliance on behalf of each Subsidiary, with all applicable laws,
rules, regulations, and orders, except, with respect to First Commercial
Bancorp, Inc. and First Commercial Bank, any noncompliance with financial
covenants under a memorandum of understanding, order or other matter
applicable to either or both of such Subsidiaries (which noncompliance shall
be disclosed by the Borrower to the Agent in writing) which shall not cause
any material adverse action by the applicable regulatory authority and could
not have a material adverse effect upon the business or operations of either
or both of such Subsidiaries on an individual basis or of the Borrower and
the Subsidiaries on a consolidated basis. Compliance shall include, without
limitation, paying before the same become delinquent all taxes, assessments,
and governmental charges imposed upon it or upon its property.
Section VI.05. Right of Inspection. At any time during
-------------------
normal business hours and from time to time, upon at least one (1) Business
Day's advance notice, permit the Agent and any Bank or any agent or
representative thereof to examine and make copies of and abstracts from the
records and books of account of and visit the properties of, Borrower and
each Subsidiary, and to discuss the affairs, finances, and accounts of
Borrower and each Subsidiary, with any of its or their officers and
directors and with the Borrower's independent accountants, provided,
--------
however, that with respect to the loans of Borrower or a Pledged Subsidiary,
- -------
the Agent and any Bank may review and make copies of summaries of the Watch
List prepared on a quarterly basis and loan audit reports; review of
specific loan accounts and loan review reports may be requested by the Agent
or any Bank, whereupon Borrower and Agent or the Bank shall within ten (10)
days agree as to the number of such accounts and reports that are reasonable
and appropriate to review, and provided further, that upon and during the
----------------
existence of an Event of Default hereunder, there shall be no restrictions
or conditions on the scope of the review, inspection and reproduction rights
of Agent and the Banks concerning the loans of Borrower or a Pledged
Subsidiary.
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Section VI.06. Reporting Requirements. Furnish to the Agent:
----------------------
(1) Quarterly Financial Statements. As soon as practicable,
------------------------------
or in any event within forty-five (45) days after the end of each fiscal
quarter of Borrower (a) parent only and consolidated balance sheets of
Borrower and its Subsidiaries as of the end of such fiscal quarter and (b)
parent only and consolidated statements of income and earnings retained in
the business of Borrower and its Subsidiaries for such fiscal quarter, all
of which shall be prepared in accordance with GAAP and certified by the
chief financial officer or chief accounting officer of Borrower.
(2) Annual Financial Statements. As soon as practicable, or
---------------------------
in any event within ninety (90) days after the close of each fiscal year of
Borrower (a) parent only and consolidated balance sheets of Borrower and its
subsidiaries at year end and (b) parent only and consolidated statements of
income and earnings retained in the business of Borrower and its
Subsidiaries including consolidated and parent only statements of cash flow
for such fiscal year, all of which shall include comparative statements for
the preceding year and shall be prepared in accordance with GAAP as
interpreted by Borrower's independent certified public accountants and
consistently applied, and shall be certified by, and accompanied by an
unqualified audit opinion of a firm of certified public accountants
acceptable to Agent; provided, however, that the opinion may be limited to
-------- -------
the consolidated statements of Borrower.
(3) Reports. Within forty-five (45) days after such report is
-------
filed and to the extent not prohibited by law, copies of all reports filed
by Borrower (on a consolidated and parent only basis), First Commercial
Bancorp, Inc. and/or First Banks America, Inc. (on a consolidated and parent
only basis) with the Board of Governors of the Federal Reserve System or any
Federal Reserve Bank, the Federal Deposit Insurance Corporation ("FDIC"),
Securities and Exchange Commission ("SEC"), or other bank or thrift
regulatory agency; within forty-five (45) days after the end of each fiscal
quarter of Borrower, a list of all such reports. Irrespective of the
foregoing procedures for the request for copies of reports, Borrower shall
submit to the Agent, within forty-five (45) days from the date of submission
to the SEC, copies of the following SEC reports with respect to the
Borrower, First Commercial Bancorp, Inc. and/or First Banks America, Inc.:
10-K, 10-Q, and 8-K. Borrower shall also submit (or cause to be submitted)
to the Agent, within fifteen (15) days from the date of such agreement,
copies of any and all agreements entered into by Borrower or any of
Borrower's Subsidiaries with the Board of Governors of the Federal Reserve
System, any Federal Reserve Bank, the FDIC, the SEC, or other bank or thrift
regulatory agency.
(4) Subsidiary Reports. Copies of all Quarterly Reports of
------------------
Condition and Income ("Call Report"), certified as required by law, filed by
-----------
each Subsidiary with the FDIC or any other governmental or regulatory
agency, within forty-five (45) days from the date any such Call Report is
submitted to such agency, and, to the extent permitted by law, copies of all
examination reports and supervisory comment letters pertaining to each
Subsidiary.
(5) Examination; Litigation. Promptly after the commencement
-----------------------
thereof, notice of all suits and proceedings before any court or
governmental department, commission, board, or agency affecting Borrower or
any Subsidiary which, if determined adversely, could have a material adverse
effect on the financial condition, properties or operations of Borrower or
any Subsidiary; promptly after the receipt thereof, notice of any report or
comment letter from any regulatory authority of Borrower or any Subsidiary,
or from the independent auditors of Borrower, which requires any action of a
material adverse nature by Borrower or any Subsidiary.
(6) Compliance Certificate. Within forty-five (45) days after
----------------------
the end of each fiscal quarter of Borrower, a Compliance Certificate signed
by at least two of the chief executive
27
35
officer, the chief financial officer, the president, the chief accounting
officer and the chief credit officer of the Borrower, substantially in the
form of Exhibit H attached hereto.
---------
(7) Watch List; Reports. Within forty-five (45) days after
-------------------
the end of each fiscal quarter of Borrower, a Watch List, together with a
list of examinations or examination reports issued or conducted by
regulatory authorities of Borrower or a Pledged Subsidiary during said
fiscal quarter.
(8) Other Information. Such other information and reports
-----------------
regarding the financial condition, operations or regulatory affairs of
Borrower or any Subsidiary as Agent or a Bank may from time to time
reasonably request.
Section VI.07. Operations. Operate and maintain its business
----------
and property, and those of its Subsidiaries, in the ordinary course in a
prudent manner consistent with sound banking practices and in such a manner
that the performance by Borrower of its obligations hereunder are not
jeopardized or impaired.
Section VI.08. Additional Collateral. Pursuant to the Pledge
---------------------
Agreement and/or the Subsidiary Pledge Agreements, pledge and deliver to
Agent shares of stock of (i) a bank, thrift institution, bank holding
company or savings holding company hereafter acquired by Borrower or any
Pledged Subsidiary (other than as may be acquired by First Banks America,
Inc. or First Commercial Bancorp, Inc.) with all or a portion of such shares
having been acquired with the proceeds of a Loan (or the consideration for
which is supplemented or supported, directly or indirectly, by a Letter of
Credit), or (ii) a bank, thrift institution, bank holding company or savings
holding company which becomes a Subsidiary (other than as may be acquired by
First Banks America, Inc. or First Commercial Bancorp, Inc.).
ARTICLE VII.
NEGATIVE COVENANTS
------------------
So long as any portion of the indebtedness evidenced by the
Notes shall remain unpaid, any Bank shall have any Commitment under this
Agreement, or any Letter of Credit shall remain outstanding, or any Unpaid
Drawing shall remain unreimbursed by the Borrower, Borrower will not,
without the prior written consent of the Agent, which consent shall not be
unreasonably withheld:
Section VII.01. Liens. Create, incur, assume, or suffer to
-----
exist, any Lien, or permit any Subsidiary (other than First Banks America,
Inc. and First Commercial Bancorp, Inc.) to create, incur, assume, or suffer
to exist, any lien, upon or with respect to any of the Collateral or any
capital stock held by any Subsidiary, except in favor of the Agent.
Section VII.02. Mergers, Etc. Merge or consolidate with any
------------
Person having Total Assets in excess of $250,000,000 or which is subject to
a regulatory action or proceeding or any cease and desist order which
relates in any material adverse way to the management, financial condition,
or operations of such Person, or permit the merger or consolidation of any
Subsidiary with any Person having Total Assets in excess of $250,000,000 or
which is subject to a regulatory action or proceeding or any cease and
desist order which relates in any material adverse way to the management,
financial condition, or operations of such Person, or sell, assign, lease,
or otherwise dispose of (whether in one transaction or in a series of
transactions) any Subsidiary or all or substantially all of its other
assets, or permit the sale, assignment, lease, or other disposition of any
Subsidiary, or the sale of all or substantially all of the assets of any
Subsidiary (whether now
28
36
owned or hereafter acquired), to any Person; provided, however, that the
-------- -------
pledge of the First Commercial Bank common stock to Borrower to secure
convertible debentures issued by First Commercial Bancorp, Inc. in an amount
not to exceed $6,500,000 is permitted, and provided further, that nothing in
----------------
this Section 7.02 shall prevent mergers or sale of assets as between two
entities that are Pledged Subsidiaries (other than River Valley Holdings,
Inc.). Notwithstanding the foregoing, River Valley Holdings, Inc. will not,
without the prior written consent of the Agent, merge with or into any Person
other than the Borrower or sell, assign, lease, or otherwise dispose of
(whether in one transaction or in a series of transactions) all or
substantially all of its assets to any Person other than the Borrower.
Section VII.03. Indebtedness. Incur, create, assume or allow
------------
to exist, nor permit any Subsidiary to incur, create, assume or allow to
exist, any indebtedness, whether contingent or absolute, except
indebtedness: (i) evidenced by the Notes or the reimbursement obligations
with respect to the Letters of Credit; (ii) evidenced by certain unsecured
notes issued by Borrower relating to the acquisition of Southside
Bancshares, Inc. common stock and in an aggregate principal amount not to
exceed $272,000; (iii) evidenced by certain notes to the former shareholders
of St. Charles Federal Bancshares, Inc. in an aggregate principal amount not
to exceed $1,136,777.28; (iv) evidenced by certain debentures payable to
Borrower issued by First Commercial Bancorp, Inc. in an amount not to exceed
$6,500,000; (v) relating to certain reimbursement obligations of CCB
Bancorp, Inc. with respect to certain loans to CCB Bancorp, Inc. in an
amount not to exceed $13,500,000; (vi) relating to certain reimbursement
obligations of First Banks America, Inc. with respect to certain loans to
First Banks America, Inc. in an amount not to exceed $13,000,000; (vii)
arising out of accrued expenses or payables in the ordinary course of
business; (viii) of accrued taxes not yet payable; (ix) for any other
purpose (other than by or on behalf of River Valley Holdings, Inc.) not to
exceed in the aggregate the amount of $2,500,000;
Section VII.04. Dividends. Pay or declare any dividends on
---------
the common stock of Borrower; pay or declare any dividends upon the
preferred stock of Borrower designated as Class A or Class B preferred stock
in the financial statements of Borrower if a Default or an Event of Default
exists or if, after giving effect thereto, a Default or Event of Default
would exist.
Section VII.05. Stock Issue; Additional Issue of Stock of
----------------------------------------
Subsidiary. Create any new class or amend the terms of any existing class
- ----------
of stock of Borrower, or issue any shares of stock of any class of Borrower,
the terms of which have not been approved by Agent for the account of the
Banks; issue or permit any Subsidiary to issue any additional shares of
stock of any class or any capital notes or other long-term debt instruments,
or create any new class of stock or amend the terms of any existing class of
stock.
Section VII.06. Stock Redemption. Redeem, purchase or retire
----------------
any shares of any existing class of stock of Borrower or any capital notes
of Borrower or permit any Subsidiary to redeem, purchase or retire any
shares of any existing class of stock of such Subsidiary or any capital
notes of such Subsidiary; provided, however, that as long as no Event of
-------- -------
Default shall have occurred and be continuing, with respect to Subsidiaries
which are not wholly owned by the Borrower, such Subsidiary(ies) may redeem,
purchase or retire shares of any existing class of stock of such Subsidiary.
Section VII.07. Loans. Loan money or extend credit to, or
-----
become a surety or guarantor for, or permit any Pledged Subsidiary to do
likewise, the benefit of any Affiliate or any Subsidiary or any executive
officer or shareholder of any Affiliate or any Subsidiary; provided,
--------
however, that Borrower and the Pledged Subsidiaries (other than River Valley
- -------
Holdings, Inc.) may extend credit to executive officers or shareholders of
any Affiliate or
29
37
Subsidiary (other than River Valley Holdings, Inc.) if the loan or extension
of credit complies in all respects with applicable law and regulations, and
provided further, that the following items of current indebtedness are
- ----------------
permitted: (i) loans to Subsidiaries (other than River Valley Holdings, Inc.)
for the purpose of acquiring and holding OREO properties, (ii) loans for
operating purposes to Hermanhoff Winery, Inc., in an aggregate amount not to
exceed $500,000 at any one time, (iii) loans for operating purposes to Tidal
Insurance, Ltd., in an aggregate amount not to exceed $250,000 at any one
time, (iv) the purchase by Borrower of convertible debentures issued by First
Commercial Bancorp, Inc. in an amount not to exceed $6,500,000, (v) loans to
CCB Bancorp for the purpose of purchasing a $5,000,000 debenture issued by QCB
Bancorp and for acquiring La Cumbre Savings Bank, fsb, in an amount not to
exceed $13,500,000 at any one time, (vi) loans to First Banks America, Inc.
for the purpose of acquiring Sunrise Bancorp in an amount not to exceed
$13,000,000 at any one time, and (vii) loans to Firstserv, Inc. (an Affiliate
formed for the purpose of providing data processing services and mortgage loan
processing services to Pledged Subsidiaries) and to First Securities of
America (an Affiliate formed for the purpose of engaging in permitted
insurance activities) in an aggregate amount not to exceed $1,000,000 at any
one time.
Section VII.08. Continuation of Business. Substantially
------------------------
change, nor permit any of its Subsidiaries to change substantially, the
nature of the respective businesses in which they are now engaged, nor
engage in, nor permit any Subsidiary to engage in, any line of business if,
as a result thereof, the business of the Borrower and its Subsidiaries,
taken as a whole, would not be predominately the banking or thrift business
(and activities deemed closely related to banking and/or the thrift business
by applicable regulatory authorities) as currently constituted as of the
date hereof.
ARTICLE VIII.
FINANCIAL COVENANTS
-------------------
So long as any portion of the indebtedness evidenced by the
Notes shall remain unpaid or any Bank shall have any Commitment under this
Agreement, or any Letter of Credit shall remain outstanding, or any Unpaid
Drawing shall remain unreimbursed by the Borrower, Borrower and the Pledged
Subsidiaries (other than River Valley Holdings, Inc.) will comply with each
of the following covenants:
Section VIII.01. Tier I Leverage Ratio. Borrower and
---------------------
Subsidiaries, on a consolidated basis, shall maintain a minimum Tier I
Leverage Ratio at the end of each quarterly accounting period of not less
than 5.0% or such greater amount as may be required to be considered "well
capitalized" by applicable regulatory authorities from time to time.
Section VIII.02. Tier I Leverage Ratio of Subsidiaries. Each
-------------------------------------
Subsidiary of Borrower which is a bank holding company (other than First
Commercial Bancorp, Inc.), on a consolidated basis, shall maintain a minimum
Tier I Leverage Ratio at the end of each quarterly accounting period of not
less than 5.0% or such greater amount as may be required to be considered
"well capitalized" by applicable regulatory authorities from time to time,
and First Commercial Bancorp, Inc., on a consolidated basis, shall maintain
a minimum Tier I Leverage Ratio at the end of each quarterly accounting
period of not less than 1.5%. Each Subsidiary of Borrower engaged in
banking shall maintain a minimum Tier I Leverage Ratio at the end of each
quarterly accounting period of not less than 5.0% or such greater amount as
may be required to be considered "well capitalized" by applicable regulatory
authorities from time to time.
Section VIII.03. Tier I Risk Based Capital Ratio. Each
-------------------------------
Subsidiary of Borrower which is bank holding company (other than First
Commercial Bancorp, Inc.), on a
30
38
consolidated basis, shall maintain a minimum Tier I Risk Based Capital Ratio
at the end of each quarterly accounting period of not less than 6.0% or such
greater amount as may be required to be considered "well capitalized" by
applicable regulatory authorities from time to time, and First Commercial
Bancorp, Inc., on a consolidated basis, shall maintain a minimum Tier I Risk
Based Capital Ratio at the end of each quarterly accounting period of not less
than 2.4%. Each Subsidiary of Borrower engaged in banking shall maintain a
minimum Tier I Risk Based Capital Ratio at the end of each quarterly
accounting period of not less than 6.0% or such greater amount as may be
required to be considered "well capitalized" by applicable regulatory
authorities from time to time.
Section VIII.04. Total Risk Based Capital Ratio. Each
------------------------------
Subsidiary of Borrower which is a bank holding company (other than First
Commercial Bancorp, Inc.), on a consolidated basis, shall maintain a minimum
Total Risk Based Capital Ratio at the end of each quarterly accounting
period of not less than 10.0% or such greater amount as may be required to
be considered "well capitalized" by applicable regulatory authorities from
time to time, and First Commercial Bancorp, Inc., on a consolidated basis,
shall maintain a minimum Total Risk Based Capital Ratio at the end of each
quarterly accounting period of not less than 3.7%. Each Subsidiary of
Borrower engaged in banking, other than BancTEXAS, N.A., shall maintain a
minimum Total Risk Based Capital Ratio at the end of each quarterly
accounting period of not less than 10.0% or such greater amount as may be
required to be considered "well capitalized" by applicable regulatory
authorities from time to time. BancTEXAS, N.A. shall maintain a minimum
Total Risk Based Capital Ratio at the end of each quarterly accounting
period of not less than 8.0% or such greater amount as may be required to be
considered "adequately capitalized" by applicable regulatory authorities
from time to time.
Section VIII.05. Loan Loss Reserve. Borrower and Subsidiaries,
-----------------
on a consolidated basis, shall maintain a minimum Loan Loss Reserve,
expressed as a percentage of Total Loans, for each quarterly accounting
period of 1.25% or such greater amount as may be required by regulatory
authorities or prudent banking standards from time to time.
Section VIII.06. Net Income to Average Total Assets. The
----------------------------------
Borrower and Subsidiaries, on a consolidated basis, shall maintain a ratio,
expressed as a percentage, of Net Income less Gain on Sale of Securities and
other extraordinary and/or non-recurring items (as determined in accordance
with GAAP) to Average Total Assets of not less than 0.65% for the 1996
fiscal year of Borrower, and not less than 0.70% for each fiscal year of
Borrower thereafter.
Section VIII.07. Non-Performing Assets. Borrower and
---------------------
Subsidiaries, on a consolidated basis, shall have Non-performing Assets, in
the aggregate, of not more than 25% of Primary Capital.
ARTICLE IX.
EVENTS OF DEFAULT
-----------------
Section IX.01. Events of Default. If any of the following
-----------------
events ("Events of Default") shall occur:
(1) Borrower shall fail to pay (a) the principal of, or
interest on, a Note, or (b) any reimbursement obligation in respect of
Letters of Credit, within five (5) calendar days of the applicable due date;
31
39
(2) Borrower shall fail to pay any fees or any other amount
payable hereunder when due and such failure shall remain unremedied for ten
(10) consecutive calendar days after notice of such failure shall have been
given to the Borrower by the Agent;
(3) Any representation or warranty made or deemed made by the
Borrower or any Subsidiary in this Agreement, the Pledge Agreement, the
Subsidiary Pledge Agreements, or which is contained in any certificate,
document, opinion, or financial or other statement furnished at any time
under or in connection with any Loan Document, shall be reasonably
determined by the Agent to have been incorrect in any material respect on or
as of the date made or deemed made and such default remains unremedied for
thirty (30) consecutive calendar days after notice thereof shall have been
given to the Borrower by the Agent;
(4) (a) Borrower shall fail to perform or observe any term,
covenant, or agreement contained in any Loan Document (other than as
contained in Article VIII hereof and other than as contained in a Note) on
its part to be performed or observed, and such failure shall remain
unremedied for thirty (30) consecutive calendar days after notice thereof
shall have been given to the Borrower by the Agent, provided, however, that
-------- -------
in the event two or more such notices are required to be given in any
consecutive six month period, Agent at its option need not give such notice,
and there shall not be any period for the cure of such failure with respect
to such second or succeeding failure, or (b) Borrower shall fail to perform
or observe any term, covenant, or agreement contained in Article VIII hereof
or in a Note;
(5) Borrower or any Subsidiary (a) shall generally not, or
shall be unable to, or shall admit in writing its inability to pay its debts
as such debts become due; or (b) shall make an assignment for the benefits
of creditors, petition or apply to any tribunal for the appointment of a
custodian, receiver, or trustee for it or a substantial part of its assets;
or (c) shall commence any proceedings under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution, or liquidation law or
statute of any jurisdiction, whether now or hereafter in effect; or (d)
shall have any such petition or application filed or any such proceeding
commenced against it, in which an order for relief is entered or
adjudication or appointment is made and which remains undismissed for a
period of thirty (30) calendar days or more; or (e) by any act or omission
shall indicate its consent to, approval of, or acquiescence in any such
petition, application, or proceeding, or order for relief, or the
appointment of a custodian, receiver, or trustee for all or any substantial
part of its properties; or (f) shall suffer any such custodianship,
receivership or trusteeship to continue undischarged for a period of thirty
(30) calendar days or more;
(6) One or more judgments, decrees, or orders for the payment
of money in excess of One Million Dollars ($1,000,000) in the aggregate
shall be rendered against Borrower or any Subsidiary, and such judgments,
decrees, or orders shall continue unsatisfied and in effect for a period of
thirty (30) consecutive calendar days without being vacated, discharged,
satisfied, or stayed or bonded pending appeal;
(7) Any of the Pledge Agreement and/or the Subsidiary Pledge
Agreements shall at any time after its execution and delivery and for any
reason (other than by the action of the Agent) cease (a) to create a valid
and perfected Lien in and to the property purported to be subject thereto,
of the priority represented therein, or (b) to be in full force and effect
or shall be declared null and void, or the validity or enforceability
thereof shall be contested by Borrower or any Subsidiary, or Borrower or any
Subsidiary, as applicable, shall deny or disclaim further liability or
obligation thereunder, or Borrower or any Subsidiary shall fail to perform
any of its obligations thereunder, and solely with respect to performance of
obligations by the Borrower or any Subsidiary, as applicable, under the
Pledge Agreement and/or the Subsidiary Pledge Agreements, such default
remains unremedied for thirty (30) consecutive calendar days after notice
thereof shall
32
40
have been given to the Borrower by the Agent (the other events described in
this Section 9.01(7) shall become Events of Default immediately upon
occurrence without notice to the Borrower);
(8) Any of the following events occur or exist with respect to
Borrower or any Subsidiary: (a) any Prohibited Transaction involving any
Plan; (b) any Reportable Event with Respect to any Plan; (c) the filing
under Section 4041 of ERISA of a notice of intent to terminate any Plan or
the termination of any Plan; (d) any event or circumstance that might
constitute grounds entitling the PBGC to institute proceedings under Section
4042 of ERISA for the termination of, or for the appointment of a trustee to
administer, any Plan, or the institution by the PBGC of any such
proceedings; (e) complete or partial withdrawal under Section 4201 or 4204
of ERISA from a Multiemployer Plan or the reorganization, insolvency or
termination of any Multiemployer Plan; and in each case above, such event or
condition, together with all other events or conditions, if any, could in
the opinion of the Agent subject the Borrower or any Subsidiary to any tax,
penalty, or other liability to a Plan, a Multiemployer Plan, the PBGC, or
otherwise (or any combination thereof) which in the aggregate exceed or may
exceed Two Hundred Fifty Thousand Dollars ($250,000);
(9) If James F. Dierberg and/or Mary W. Dierberg (together
with any trust or partnership or other entity over which he or she has
voting control) cease to own in the aggregate at least 51% of the voting
shares of stock of First Banks, Inc.;
(10) Except for those matters disclosed on Schedule 9.01(10),
-----------------
if any regulatory action or proceeding shall be commenced, or any cease and
desist order shall be entered into, between any state or federal regulatory
authority and Borrower or any Subsidiary which relates in any material
adverse way to the management or operations of Borrower or any Subsidiary;
(11) A default or an event of default exists or is declared
under the terms of any indebtedness or other material agreements of the
Borrower or any Subsidiary which continues beyond any applicable notice and
cure period;
(12) The Borrower shall fail to have positive Net Income for
any two consecutive fiscal quarters; or
(13) The Majority (as hereinafter defined) shall have
determined in good faith (which determination shall be conclusive) that (a)
a material adverse change has occurred in the assets, business, operations,
properties or condition, financial or otherwise, of the Borrower, or (b) the
Banks' security interest in the Collateral or in any material portion
thereof has been adversely affected or impaired, or the value of the
Collateral to the Banks relative to the amount of outstanding obligations
hereunder has been diminished to a material extent, or (c) the prospect of
payment or performance of any obligation or agreement of the Borrower
hereunder or under any of the Loan Documents is materially impaired, and the
condition giving rise to such determination does not constitute an Event of
Default under any of the other subsections of this Section 9.01;
then, in any such event Agent shall at the request of the Majority (as
hereinafter defined) declare the Banks' obligations to make Revolving Loans
or issue Letters of Credit to be terminated, whereupon the same shall
forthwith terminate and declare the outstanding Notes, all interest thereon,
and all other amounts payable under this Agreement to be forthwith due and
payable in full, whereupon the Notes, all such interest, and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest, or further notice of any kind, all of which are hereby
expressly waived by the Borrower; provided, that in the case of any of the
--------
Events of Default specified in subsection (5) above, without any notice to
the Borrower or any other act by the Agent or the Banks, the Banks'
obligations to make Revolving Loans and issue Letters of
33
41
Credit shall be automatically terminated and the Notes, all interest thereon,
and all other amounts payable under this Agreement shall be forthwith due and
payable in full, without presentment, demand, protest, or further notice of
any kind, all of which are hereby expressly waived by the Borrower.
ARTICLE X.
AUTHORITY AND RESPONSIBILITIES OF AGENT
---------------------------------------
Section X.01. Grant of Authority. Each of the Banks hereby
------------------
irrevocably appoints and authorizes The Boatmen's National Bank of St.
Louis, as the Agent under this Agreement and each other Loan Document, on
its behalf, to take such action and exercise such powers under this
Agreement and each other Loan Document as are specifically delegated to the
Agent by the terms thereof, together with such other powers as are
reasonably incidental thereto. The Agent shall have no duty to exercise any
right or power or remedy hereunder or to take any affirmative action
hereunder unless directed to do so by the Majority (as hereafter defined).
For purposes of this Agreement, the term "Majority" shall mean the Banks
--------
holding at least sixty-six percent (66%) in dollar amount of the Commitment.
Section X.02. Action upon Indemnification Instructions. The
----------------------------------------
Agent shall in all cases be fully justified and protected in acting or
continuing, failing or refusing to take any action hereunder or under any
other Loan Document upon the written instructions signed by the Majority,
and such instructions and any action taken or any failure to act pursuant
hereto shall be binding on all of the Banks, all holders of the Notes and
their respective successors and assigns.
Section X.03. Reports; Responsibility of the Agent;
-------------------------------------
Disclaimer. Promptly upon the receipt thereof from the Borrower, Agent
- ----------
shall photocopy and forward to each Bank each report, statement and other
written information received by Agent pursuant to the terms of Section 6.06
of this Agreement. Neither the Agent nor any of its respective directors,
officers, agents, employees, attorneys-in-fact or affiliates shall be liable
for any action taken or omitted to be taken under or in connection with this
Agreement or any other Loan Document, except for its or their willful
misconduct or gross negligence. Without limiting the generality of the
foregoing, the Agent:
(1) shall not be responsible to any Bank for any statement,
representation or warranty made by any Bank other than Agent or any officer
thereof under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby;
(2) shall not be responsible for the due execution,
effectiveness, validity, enforceability or sufficiency of this Agreement,
the Notes, the Pledge Agreement, the Subsidiary Pledge Agreements or any
other document or instrument furnished pursuant hereto or in connection
herewith;
(3) shall not be bound to ascertain or inquire as to the
performance or observance of any of the terms, provisions or conditions of
this Agreement or any other Loan Document on the part of the Borrower or any
Subsidiary or as to the business, operation, property, assets or condition
(financial or otherwise) of the Borrower or its Subsidiaries;
(4) shall be entitled to rely upon any writing, statement,
notice or any telegraph, telex, teletype or telecopy message or any
telephone conversation believed by it to be genuine and correct and, in the
case of any writing, to have been signed or sent by the proper person;
34
42
(5) may consult with counsel and independent accountants and
other experts selected by the Agent and shall be fully protected in any
action taken or omitted to be taken in accordance with the advice of such
counsel, independent accountants or other experts;
(6) may employ agents and attorneys-in-fact and shall not be
liable for the default, negligence or misconduct of any such selected by the
Agent with reasonable care;
(7) may treat the payee of a Note as the holder thereof until
it receives written notice of the assignment or transfer thereof signed by
such payee and in form satisfactory to the Agent. Any request, authority or
consent of any person who at such time is the holder of any Note shall be
conclusive and binding on any subsequent holder, transferee or assignee of
such Note or Note issued in exchange therefor; and
(8) shall have no liability or responsibility to Borrower for
any failure on the part of any Bank to comply with an obligation on its part
to be performed under this Agreement.
Section X.04. Correction of Errors. If the Agent shall pay
--------------------
any amount to any Bank pursuant hereto in the belief or expectation that a
related payment has been or will be received or collected from the Borrower
in connection with any Loan and such related payment is not actually
received or collected by the Agent then such Bank will promptly, on demand
by the Agent, return such amount to the Agent, together with interest
thereon at the federal funds rate for overnight deposits.
Section X.05. Expenses; Indemnification. To the extent that
-------------------------
the Borrower fails to do so, each Bank, and each subsequent holder of a Note
by its acceptance thereof, agrees to reimburse the Agent upon demand in
proportion to the unpaid principal amount of its Notes, or if no Notes are
at the time outstanding in proportion to the Commitments, and to indemnify
and hold the Agent and its directors, officers, employees and agents in
their respective capacities harmless in such proportion against any and all
losses, liabilities, damages, demand, judgment, claim, counterclaim,
set-off, cost, disbursement or expenses of any kind whatsoever (including
reasonable attorney's fees and expenses) incurred by or asserted against the
Agent or its directors, officers, employees and agents under or in
connection with any of the foregoing arising out of or in connection with
this Agreement, the Notes or any other Loan Documents, the transactions
contemplated hereunder, the enforcement, collection or realization of any
thereof or any action taken or omitted by the Agent, provided that no Bank
shall be liable for any portion of the foregoing incurred by the Agent as a
result of its willful misconduct or gross negligence. The agreements in
this Section 10.05 shall survive the payment of the Loans, or any other
amounts payable hereunder or under the Notes and the termination of the
Commitments.
Section X.06. Rights as Bank. With respect to its Loans and
--------------
the Notes issued to it, the Agent shall have the same rights and powers
hereunder as any Bank and may exercise the same as though it were not the
Agent, and the term "Bank" or "Banks" shall include the Agent in its
---- -----
individual capacity. The Agent and any of its affiliates may accept
deposits from, lend money to, and generally engage in any kind of banking or
trust business with, the Borrower and any affiliates as if it were not the
Agent and may accept fees and other consideration from the Borrower for
services in connection with this Agreement and otherwise without having to
account for the same to the Banks.
Section X.07. Representation of Each Bank. Each Bank
---------------------------
expressly acknowledges that the Agent has not made any representations or
warranties to it and that no action taken or hereafter taken by the Agent
shall be deemed to constitute a representation or warranty by the Agent to
any other Bank. Each Bank represents and warrants to the Agent that it has
made and
35
43
will continue to make its own independent investigation of the condition
(financial and otherwise) and affairs of the Borrower and the Subsidiaries in
connection with this Agreement and the Notes without reliance on the Agent or
on any information or documents prepared by the Agent. Except for notices,
reports and other documents expressly required to be furnished to the Banks by
the Agent hereunder, the Agent shall not have any duty or responsibility to
provide any Bank or any of its respective officers, directors, employees,
agents, attorneys-in-fact or affiliates any other information or documentation
pertaining to Borrower, the Subsidiaries, or their financial affairs.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Agent shall not have any duties or responsibilities, except those expressly
set forth herein, or any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or otherwise exist against the Agent.
Section X.08. Rights to Resign; Appointment of a Successor
--------------------------------------------
Agent. The Agent may resign as such at any time upon thirty (30) calendar
- -----
days' notice to the Borrower and the Banks. In such event, the Majority
shall appoint a successor Agent which shall be an incorporated bank or trust
company, provided, however, that if there is no Default or Event of Default
-------- -------
at the time of such appointment and provided further the successor Agent is
to be a bank other than Harris Trust and Savings Bank, Norwest Bank
Minnesota, National Association, American National Bank and Trust Company of
Chicago, or The Frost National Bank, the Agent shall send to Borrower a list
of at least three (3) banks which are satisfactory to the Majority to serve
as the successor Agent, whereupon the Borrower shall have three (3) Business
Days in which to select which bank on the list is to be the successor Agent.
In the event of the failure of the Borrower to select a bank from the list,
then the right of selection granted to the Borrower hereunder shall forever
lapse. If no successor shall have been so appointed and accepted such
appointment within thirty (30) days after the retiring Agent's giving of
notice of resignation or the Majority's removal of the retiring Agent, then
the retiring Agent may, on behalf of the Banks, appoint a successor, which
shall be a Bank, or, if no such Bank accepts such appointment, which shall
be a bank or trust company with an office (or an affiliate with an office)
in St. Louis, Missouri, having a combined capital and surplus of not less
than One Hundred Million Dollars ($100,000,000). Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder. After any retiring
Agent's resignation or removal hereunder as Agent, the provisions of this
Article X shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
Section X.09. Notice of Default. The Agent shall not be
-----------------
deemed to have knowledge or notice of the occurrence of any Default or Event
of Default hereunder unless the Agent has received notice from a Bank or the
Borrower referring to this Agreement, describing such Default or Event of
Default and, in the case of any Default or Event of Default other than those
described in Section 9.01 of this Agreement, stating that such notice is a
"notice of default". The Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Majority,
provided that unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Banks.
Section X.10. Agent Compensation. For its services as Agent
------------------
hereunder, Borrower shall pay to Agent on the date of this Agreement and on
each anniversary date thereof, certain compensation as heretofore agreed
between Agent and Borrower.
36
44
ARTICLE XI.
MISCELLANEOUS
-------------
Section XI.01. Capital Adequacy Reimbursement. If after the
------------------------------
date hereof, the Agent shall be advised that or shall determine that with
respect to any of the Banks the adoption or the taking effect of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency or compliance
by the Banks with any request or directive regarding capital adequacy
(whether or nor having the force of law) of any such authority, central bank
or comparable authority, has or would have the effect of reducing the rate
of return on or increasing the cost of maintaining all of the Banks' capital
as a direct consequence of their obligations hereunder (taking into
consideration the Banks' policies with respect to capital adequacy) then
from time to time, within fifteen (15) calendar days after demand by Agent,
Borrower shall pay to Agent such additional amount or amounts as will
compensate the Banks for such reduction or increase. A certificate of the
Agent claiming compensation under this Section and setting forth the
additional amount or amounts to be paid to it hereunder shall be conclusive
and binding in the absence of manifest error.
Section XI.02. Amendments, Etc. Except as expressly provided
---------------
in Article VII hereof, no amendment, modification, termination, or waiver of
any provision of any Loan Document, nor consent to any departure by the
Borrower from any Loan Document, shall in any event be effective unless the
same shall be in writing and signed by the Agent and a Majority of the
Banks, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
--------
however, that no such amendment, modification, termination or waiver of any
- -------
provision of any Loan Document shall: (a) postpone the stated maturity of
principal of, or interest on, any of the Loans or the reimbursement
obligations with respect to the Letters of Credit, or reduce the principal
amount of, the rate of interest on, or the fees in connection with this
Agreement; (b) increase the maximum amount of the Revolving Loan Commitment
or the Revolving Loan Commitment of any Bank; (c) change the percentages
required for action by the Banks under this Section 11.02 or by the Majority
under this Agreement; or (d) release or subordinate any Liens in favor of
the Agent on any of the Collateral, except as otherwise expressly provided
herein. The consent of all of the Banks is required to effect any
amendment, modification or waiver of the provisions of this Agreement and of
each Loan Document which provisions are of a type described in clauses (a),
(b), (c) or (d) of this Section 11.02. The consent of the Borrower will not
be required to effect any amendment, modification or waiver of the
provisions of Article X of this Agreement.
Section XI.03. Notices, Etc. All notices and other
------------
communications provided for under this Agreement and under the other Loan
Documents shall be in writing (including facsimile communication) and
mailed, sent by facsimile machine or delivered, to the parties at the
addresses set forth on Exhibit P attached or, as to each party, at such
---------
other address as shall be designated by such party in a written notice to
the other party complying as to delivery with the terms of this Section
11.03. All such notices and communications shall, when mailed, be effective
when deposited in the mails respectively addressed as aforesaid, except that
notices to the Agent and the Banks pursuant to the provisions of Article II
and Article III shall not be effective until received by the Agent and such
Banks.
Section XI.04. No Waiver; Remedies. No failure on the part
-------------------
of the Agent or any Bank to exercise, and no delay in exercising, any right,
power, or remedy under any Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right under any Loan
Document preclude any other or further exercise thereof or the exercise of any
37
45
other right. The remedies provided in the Loan Documents are cumulative
and not exclusive of any remedies provided by law.
Section XI.05. Successors and Assigns. This Agreement shall
----------------------
be binding upon and inure to the benefit of the Borrower and the Banks and
their respective successors and assigns, except that Borrower may not assign
or transfer any of its rights under any Loan Document to which Borrower is a
party without the prior written consent of the Banks, and a Bank may not
sell, assign or participate all or any portion of its Notes (other than a
sale, assignment, or participation to an affiliate bank) without the prior
written consents of Borrower and Agent.
Section XI.06. Costs and Expenses.
------------------
(1) The Borrower agrees to pay to Agent and the Banks on
demand, all costs and expenses, if any, incurred by Agent and the Banks in
connection with any modification of this Agreement and with the modification
or enforcement of any of the Loan Documents, including, without limitation,
the reasonable fees and expenses of counsel for the Agent (with respect to
modifications and enforcement) and the Banks (with respect to enforcement
only) with respect thereto and with respect to advising the Agent and the
Banks as to its respective rights and responsibilities under any of the Loan
Documents.
(2) If any payment or prepayment of principal with respect to
any Loans accruing at the Eurodollar Rate Loan is made by the Borrower other
than on the last day of the Interest Period for such Loans, and such payment
is permitted pursuant to Sections 2.06, 2.10 or 3.10, or is made as a result
of an acceleration of the maturity of the Notes pursuant to Section 9.01 or
for any other reason, the Borrower shall, upon demand by the Agent on behalf
of the Banks, pay the Agent for the account of the Banks any amounts
required to compensate the Banks for any additional losses, costs or
expenses which they may reasonably incur as a result of such payment,
including, without limitation, any loss (including loss of anticipated
profits), costs or expenses incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by the Banks to fund or
maintain such Loan.
Section XI.07. Right of Setoff. Upon the occurrence and
---------------
during the continuance of any Event of Default, each Bank is hereby
authorized at any time and from time to time, without notice to the Borrower
(any such notice being expressly waived by the Borrower), to set off and
apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by a
Bank to or for the credit or the account of Borrower against any and all of
the obligations of the Borrower now or hereafter existing under this
Agreement, the Notes or any other Loan Document, irrespective of whether or
not the Agent shall have made any demand under this Agreement or the Notes
or such other Loan Document and although such obligations may be unmatured.
Each Bank agrees promptly to notify the Borrower after any such setoff and
application, provided that the failure to give such notice shall not affect
the validity of such setoff and application. The rights under this Section
11.07 are in addition to other rights and remedies (including, without
limitation, other rights of setoff) which the Banks may have.
Section XI.08. Sharing of Setoffs. Each Bank agrees that if
------------------
it shall, by exercising any right of setoff receive payment of a proportion
of the aggregate amount of principal and interest due with respect to any of
the Notes held by it (or any other obligations of Borrower hereunder to such
Bank) which is greater than the proportion received by any other Bank in
respect of the aggregate amount of principal and interest due with respect
to any of the Notes held by such other Bank (or any other obligations of
Borrower hereunder to such Bank), the Bank receiving such proportionately
greater payment shall purchase such participations in the Notes held by the
38
46
other Banks (or any other obligations of Borrower hereunder to the other
Banks) and such other adjustments shall be made, as may be required so that
all such payments of principal and interest on the Notes (or other
obligations of Borrower hereunder to the Banks) shall be shared by the Banks
pro rata, provided that if any such non-pro rata payment is thereafter
recovered or otherwise set aside such purchase of participations shall be
rescinded (without interest).
Section XI.09. Governing Law; Jurisdiction and Venue. This
-------------------------------------
Agreement and the other Loan Documents shall be governed by, and construed
in accordance with, the laws of the State of Missouri. The Borrower hereby
consents to the jurisdiction of the Circuit Court of the County of St.
Louis, Missouri, and the United States District Court for the Eastern
District of Missouri, as well as to the jurisdiction of all courts from
which an appeal may be taken from any such courts, for the purpose of any
suit, action or other proceeding arising out of any of its obligations
arising hereunder or with respect to the transactions contemplated hereby,
and expressly waives any and all objections it may have as to venue in any
such courts and agrees that any proceeding initiated in another court which
relates to such matters may be, at the option of the Agent, transferred to
any of such courts.
Section XI.10. Severability of Provisions. Any provision of
--------------------------
any Loan Document which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining
provisions of such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
Section XI.11. Counterparts. This Agreement may be executed
------------
in any number of counterparts and by different parties to this Agreement in
separate counterparts, each which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section XI.12. Headings. Article and Section headings in the
--------
Loan Documents are included in such Loan Documents for the convenience of
reference only and shall not constitute a part of the applicable Loan
Documents for any other purpose.
Section XI.13. Oral Agreements. 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 (CREDITORS) 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.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
39
47
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
FIRST BANKS, INC.
By: /s/
---------------------------------------
Name:-------------------------------------
Title:------------------------------------
THE BOATMEN'S NATIONAL BANK
OF ST. LOUIS, as Agent and as a Bank
By: /s/
---------------------------------------
Name:-------------------------------------
Title:------------------------------------
HARRIS TRUST AND SAVINGS BANK
By: /s/
---------------------------------------
Name:-------------------------------------
Title:------------------------------------
AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO
By: /s/
---------------------------------------
Name:-------------------------------------
Title:------------------------------------
THE FROST NATIONAL BANK
By: /s/
---------------------------------------
Name:-------------------------------------
Title:------------------------------------
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
By: /s/
---------------------------------------
Name:-------------------------------------
48
EXHIBIT A
---------
TERM LOAN COMMITMENT AMOUNTS
----------------------------
Bank Amount of Commitment
---- --------------------
The Boatmen's National Bank of St. Louis $16,666,668
American National Bank and Trust Company of Chicago $11,111,111
Harris Trust and Savings Bank $8,333,333
Norwest Bank Minnesota, National Association $8,333,333
The Frost National Bank $5,555,555
$50,000,000
49
EXHIBIT B
--------
TERM NOTE
---------
$------------ St. Louis, Missouri
July 18, 1996
FOR VALUE RECEIVED, the undersigned, First Banks, Inc., a
Missouri corporation, promises to pay to the order of -----------------
("Payee") at the offices of the Agent at One Boatmen's Plaza, 800 Market
Street, St. Louis, Missouri 63101, the principal sum of ---------------
($------) or such lesser amount as may be outstanding hereunder.
The Borrower promises to pay principal and interest from the
date hereof in the amounts, at the rates and at the time or times which
shall be determined in accordance with the provisions of that certain
Secured Credit Agreement of even date herewith, by and between the Borrower,
the Payee and other banks (the "Credit Agreement").
The entire unpaid principal balance hereunder and all accrued
and unpaid interest hereon shall be due and payable on July 12, 2000.
Interest shall be calculated on the basis of the actual number of days
elapsed over a year of 360 days.
If any payment due on this Note is payable on a day which is not
a Business Day (as defined in the Credit Agreement) then such payment will
be made on the next Business Day, the amount of such payment, in such case,
to include all interest accrued to the date of actual payment.
This Note is one of the "Term Notes" referred to in the certain
Credit Agreement is secured as provided therein and is entitled to all of
the benefits thereof. In accordance with the terms of the Credit Agreement,
the Agent as defined thereunder may declare the unpaid balance of the
principal and accrued interest to be immediately due and payable upon the
occurrence of an Event of Default as defined in the Credit Agreement,
whereupon the unpaid principal and accrued interest then owing hereon shall
be and become immediately due and payable, and interest shall accrue at a
rate per annum equal to four percent (4%) in excess of the then otherwise
applicable rate of interest as determined in accordance with Sections 2.03
and 2.04 of the Credit Agreement.
The privilege of prepayment of all or a portion of the
indebtedness evidenced by this Note is as provided in the Credit Agreement.
If this Note shall not be paid at maturity, whether upon the
exercise of acceleration or otherwise, and shall be placed in the hands of
an attorney for collection or in connection with insolvency or bankruptcy
proceedings, the undersigned hereby promises to pay the reasonable fees and
expenses of such attorney in addition to the full amount due hereon, whether
or not litigation shall be commenced.
Demand for payment, protest and notice of dishonor are hereby
waived by all who are or shall become parties to this instrument.
FIRST BANKS, INC.
By:---------------------------------
Name:-------------------------------
Title:------------------------------
50
EXHIBIT C
---------
NOTICE OF INTEREST RATE SELECTION
TO: The Boatmen's National Bank of St. Louis
FROM: First Banks, Inc.
DATE: -------------------, 199--
This Notice of Interest Rate Selection is being submitted
pursuant to the terms of the Secured Credit Agreement dated as of July 18,
1996 ("Credit Agreement"), as the same may be thereafter amended from time
to time, among First Banks, Inc. and the banks named therein (for whom The
Boatmen's National Bank of St. Louis is acting as Agent).
(1) The Business Day on which the Interest Period shall commence:
---------------
(2) The current aggregate outstanding balance of the Term Loan as of the
date hereof is: ---------------
(3) Borrower requests that the Term Loan (other than the Repayment
Tranche, if applicable) accrue interest at the Eurodollar Rate.
(4) The Interest Period requested hereunder (or the new Interest Period
for an expiring Interest Period) is ---------- months. (One,
two, or three month Interest Periods are available). Such
Interest Period will expire on ----------, ----.
(5) Borrower requests that the Repayment Tranche in the amount of
$2,500,000 accrue interest at the Corporate Base Rate.
FIRST BANKS, INC.
By:-----------------------------------------
Name:---------------------------------
Title:--------------------------------
51
EXHIBIT D
---------
REVOLVING LOAN COMMITMENT AMOUNTS
---------------------------------
Bank Amount of Commitment
---- -------------------
The Boatmen's National Bank of St. Louis $13,333,332
American National Bank and Trust Company of Chicago $8,888,889
Harris Trust and Savings Bank $6,666,667
Norwest Bank Minnesota, National Association $6,666,667
The Frost National Bank $4,444,445
$40,000,000
52
EXHIBIT E
---------
REVOLVING CREDIT NOTE
---------------------
$----------------- St. Louis, Missouri
July 18, 1996
FOR VALUE RECEIVED, the undersigned, First Banks, Inc., a
Missouri corporation ("Borrower"), promises to pay to the order of
- --------------- ("Payee") at the offices of the Agent at One Boatmen's
Plaza, 800 Market Street, St. Louis, Missouri 63101, the principal sum of
- -------------- Dollars ($-------------) or such lesser amount as may be
outstanding hereunder.
The Borrower promises to pay interest from the date hereof on
the unpaid principal balance outstanding from time to time prior to maturity
at the rates and at the time or times which shall be determined in
accordance with the provisions of that certain Secured Credit Agreement of
even date herewith, by and between the Borrower, the Payee and other banks
(the "Credit Agreement").
The entire unpaid principal balance hereunder and all accrued
and unpaid interest hereon shall be due and payable on July 11, 1997.
Interest shall be calculated on the basis of the actual number of days
elapsed over a year of 360 days.
If any payment due on this Note is payable on a day which is not
a Business Day (as defined in the Credit Agreement), then such payment will
be made on the next Business Day, the amount of such payment, in such case,
to include all interest accrued to the date of actual payment.
This Note is one of the "Revolving Notes" referred to in the
Credit Agreement, is secured as provided therein, and is entitled to all of
the benefits thereof. In accordance with the terms of the Credit Agreement,
the Agent (as defined thereunder) may declare the unpaid balance of the
principal and accrued interest to be immediately due and payable upon the
occurrence of an Event of Default as defined in the Credit Agreement,
whereupon the unpaid principal and accrued interest then owing hereon shall
be and become immediately due and payable, and interest shall accrue at a
rate per annum equal to four percent (4%) in excess of the then otherwise
applicable rate of interest as determined in accordance with Sections 3.04
and 3.05 of the Credit Agreement.
If this Note shall not be paid at maturity, whether upon the
exercise of acceleration or otherwise, and shall be placed in the hands of
an attorney for collection or in connection with insolvency or bankruptcy
proceedings, the Borrower hereby promises to pay the reasonable fees and
expenses of such attorney in addition to the full amount due hereon, whether
or not litigation shall be commenced.
Demand for payment, protest and notice of dishonor are hereby
waived by all who are or shall become parties to this instrument.
FIRST BANKS, INC.
By:---------------------------------
Name:-------------------------------
Title:------------------------------
53
EXHIBIT F
---------
NOTICE OF BORROWING
-------------------
TO: The Boatmen's National Bank of St. Louis, as Agent
FROM: First Banks, Inc.
DATE:-------------------, 199-
This Notice of Borrowing is being submitted pursuant to the
terms of the Secured Credit Agreement dated as of July 18, 1996 ("Credit
Agreement"), as the same may be thereafter amended from time to time, among
First Banks, Inc. and the banks named therein (for whom The Boatmen's
National Bank of St. Louis is acting as Agent).
(1) The Business Day of the proposed principal
advance under the Credit Agreement is: --
(2) The principal advance under the Credit Agreement will be a [Base Rate
Loan] [Eurodollar Rate Loan].
(3) The Interest Period for the Eurodollar Rate Loan requested hereunder )or
the new Interest Period for an expiring Interest Period) is ---- months.
(4) The current aggregate outstanding balance of the Revolving Loans and
the current aggregate Letter of Credit Outstandings as of the
date hereof is: $--
(5) The principal advance being requested is (must be
at least the unused portion of the Revolving Loan Commitment
of $40,000,000 or $1,000,000, whichever is less): $--
(6) The use of the proceeds for the Loan requested hereby will be for
---------------------------.
(7) Unused portion of the Revolving Loan Commitment
upon advance of funds requested by this Notice
($40,000,000 - #4 - #5): $--
FIRST BANKS, INC.
By:----------------------------------
Name:--------------------------
Title:-------------------------
54
EXHIBIT G
---------
PLEDGE AGREEMENT
----------------
In consideration of and as collateral security for the payment
of any and all present and future indebtedness, obligations and liabilities
of FIRST BANKS, INC., a Missouri corporation ("Pledgor") under or pursuant
to that certain Secured Credit Agreement of even date herewith (together
with any extensions, renewals, amendments or modifications thereof, the
"Credit Agreement") among Pledgor and The Boatmen's National Bank of St.
Louis ("Boatmen's"), Norwest Bank Minnesota, National Association, Harris
Trust and Savings Bank, American National Bank and Trust Company of Chicago
and The Frost National Bank (collectively the "Banks"), all such
indebtedness, obligations and liabilities, whether direct or indirect,
liquidated or unliquidated, absolute or contingent, now existing or
hereafter arising, individual, joint, or joint and several (collectively,
the "Liabilities"), Pledgor hereby pledges to Boatmen's as agent for and for
the ratable benefit of the Banks (as agent for the Banks, Boatmen's is
referred to hereinafter as "Pledgee") and grants the Pledgee a continuing
security interest in the capital stock of certain Subsidiaries of Pledgor,
as described on Exhibit A attached hereto and incorporated herein (together
---------
with any additional stock described in Section 4 hereof, collectively, the
"Stock"), together with all substitutions therefor and dividends (as limited
herein), new shares or warrants, liquidating distributions and other rights,
and proceeds or distributions of any nature associated therewith, all of
which Pledgor hereby represents and warrants that it owns (or, for purposes
of Section 4, will own) free of liens or claims of any kind, with fully
marketable title thereto, and has (or will have) the right to so pledge.
Pledgor agrees that said Stock, together with the proceeds
thereof (hereinafter collectively called the "Collateral," such term as used
herein including any underlying security for any note or other evidence of a
monetary obligation pledged hereunder) shall constitute security for any and
all of the Liabilities and may be held, in accordance with the terms and
provisions of this Agreement, for the payment thereof for such periods and
applied thereto at such times and in such order as the Pledgee from time to
time may deem appropriate, whether or not the Liabilities for which the same
are held or applied are in existence at the time of delivery of this
Agreement or the Collateral and whether or not such Liabilities are
contingent, unliquidated or unmatured.
Pledgor further agrees that:
1. Pledgor will keep the Collateral free from all other
security interests, liens or encumbrances except those security interests,
liens or encumbrances now or hereafter granted to the Pledgee. Pledgor will
procure, execute, endorse and deliver all documents which the Pledgee may
reasonably require to protect, enforce or otherwise effectuate the Pledgee's
rights in the Collateral and Pledgor hereby grants to the Pledgee an
irrevocable power of attorney, with full power of substitution, to so act in
Pledgor's name if Pledgor fails to do so.
2. The Pledgee may collect the Collateral or any part thereof
at any time except with respect to dividends, which shall be collected by
Pledgee only in accordance with Paragraph 3 hereof. For such purpose the
Pledgee may take, in its own name or in the name of Pledgor, any action
which Pledgor might take including suit against any obligor on any note or
other monetary obligation constituting part of the Collateral and collection
of or foreclosure upon any underlying security, and such action may be taken
without first foreclosing under this Agreement on the obligations secured by
such underlying security. The Pledgee shall have no obligation, however, to
pursue or preserve remedies against any party primarily or secondarily
liable as an obligor on the Collateral or otherwise to take action which
Pledgor might have taken as regards the Collateral or any underlying
security therefor.
55
3. Pledgee shall have the continuing right to retain all or
any part of the Collateral so long as any Liability remains in existence (or
the Banks shall have any Commitment under the Credit Agreement), even though
the same may be unliquidated, unmatured or contingent. Upon maturity of any
of the Liabilities or the occurrence of an Event of Default under the Credit
Agreement or hereunder, the Pledgee may cause any of the Collateral to be
transferred to its own name or to the name of its nominee (and this shall be
full authority to any transfer agent, registrar or the like to make such
transfer). No such action shall be deemed a retention of the Collateral in
satisfaction of any Liability unless written notice so stating shall be
given to the Pledgor. The Pledgee shall have the sole right to determine
whether any call or option to surrender, exchange, redeem, convert or
otherwise change or alter the form of the Collateral shall be exercised if
the interest of Pledgee is or may be affected thereby. The Pledgee shall be
under no obligation to initiate any such action unless requested in writing
by the Pledgor. All dividends, new shares or warrants, liquidating
distributions and other rights, proceeds and payments or distributions of
any nature received by Pledgor in respect of the Collateral will be
delivered to the Pledgee in kind and the Pledgee may take such action as is
necessary to assure its direct receipt thereof, provided however that, prior
to the occurrence of an Event of Default under the Credit Agreement or
hereunder, Pledgor shall be permitted to retain permitted ordinary dividends
and interest paid in cash and shall retain the right to vote with respect to
the Collateral.
4. In the event that Pledgor, after the date hereof, acquires
all or any portion of the stock of any bank, bank holding company, thrift
institution or savings holding company (i) with the proceeds of a Loan under
the Credit Agreement (or the consideration for which is supplemented or
supported, directly or indirectly, by a Letter of Credit) or (ii) which is
or by virtue of such acquisition becomes a Subsidiary as defined in the
Credit Agreement (other than as may be acquired by First Banks America, Inc.
or First Commercial Bancorp, Inc.), Pledgor promptly shall (A) grant to
Pledgee a security interest in such stock as additional security for the
Liabilities, (B) deliver to Pledgee the certificates representing such
stock, along with fully-executed stock powers therefor, and (C) take such
other action and execute and deliver such other documents to Pledgee as
Pledgee reasonably may require in connection therewith.
5. The following severally shall be considered events of
default for purposes of this Agreement: (a) if any representation, warranty
or statement of fact made by Pledgor hereunder shall prove to be false or
misleading in any material respect, and such default remains unremedied for
thirty (30) consecutive calendar days after notice thereof shall have been
given to Pledgor by the Pledgee, (b) an Event of Default occurs under the
Credit Agreement, or (c) seizure of any of the Collateral or sale or
encumbrance thereof or the failure to pay any tax thereon when due (except
any tax contested in good faith for which reserves for payment satisfactory
to Pledgee have been provided by the Pledgor).
6. Upon maturity of any of the Liabilities (by acceleration
or otherwise) or the occurrence of an event of default hereunder, the
Pledgee may resort to the Collateral at such times and in such order as it
elects and may apply the Collateral to the Liabilities in like manner and
without regard to whether application is made to an obligation of the owner
of the Collateral so applied. If any of the Collateral is owned by someone
other than Pledgor, the Pledgee may elect to apply such Collateral in any
proportion to obligations of the owner or owners to the Pledgee without
regard to the Liabilities. In addition, the Pledgee shall have all rights
of a secured party under the Missouri Uniform Commercial Code and shall
apply the proceeds of collection, disposition or other realization on the
Collateral to reasonable attorneys' fees and legal expenses incurred by the
Pledgee in connection therewith and in the collection of any Liabilities and
representation of the Pledgee in proceedings of any nature under the
Bankruptcy Code, and thereafter as required by law. If notice of intended
disposition is required by law, such notice, if mailed, shall be deemed
reasonably and properly given if mailed to the address of Pledgor appearing
on the records of the Pledgee at least five (5) Business Days (as defined in
the Credit Agreement) before the time of such disposition. The Pledgee
shall have the right to proceed
56
against the Collateral or not as the Pledgee may deem proper or as directed by
the Majority (as defined in the Credit Agreement), and the Pledgee shall have
the right to collect dividends, interest and such like profits from the
Collateral whether or not it proceeds against the Collateral. If, in the
opinion of the Pledgee, any Collateral cannot be disposed of in a commercially
reasonable manner without registration under applicable securities laws,
Pledgor will take or cause to be taken such action as is necessary to effect
proper registration. If Pledgor shall refuse to take such action, the Pledgee
without any obligation to do so, may take such action as it deems warranted
to attempt to effect compliance with any applicable law. Any cost, fee or
expense incurred by the Pledgee in connection with such efforts or in
enforcing Pledgor's covenants hereunder will be considered a cost incurred
in disposition of the Collateral.
7. The Pledgee's rights hereunder shall continue unimpaired
notwithstanding foreclosure or other disposition of any part of the
Collateral, the availability of additional Collateral, any release of or
substitution for any of the Collateral, any act or omission impairing the
Pledgee's lien on the Collateral or the lien of any underlying security
constituting part of the Collateral, including failure to perfect the same,
any extension (including extension of time for payment), renewal,
substitution, alteration, compromise, settlement, surrender, release or
other such agreement or action modifying or varying the terms of or
otherwise affecting any of the Liabilities or any part of the Collateral,
including any act or omission releasing any party primarily or secondarily
liable on the Collateral or on any Liability. No failure by Pledgee to
exercise or delay in exercising any of its rights hereunder shall constitute
a waiver thereof and no single or partial exercise of any right shall
preclude the further exercise thereof or the exercise of any other right.
All rights of the Pledgee hereunder or under any instrument or other
agreement binding on Pledgor are cumulative and not in substitution of any
other rights at law or equity with respect to the Collateral or the
collection of the Liabilities. All such rights may be exercised from time
to time. Pledgor hereby waives notice of any and all actions, forebearances
and omissions of any rights contemplated by this paragraph and consents to
be bound thereby as effectively as if Pledgor had agreed thereto in
advance. Upon the termination of the Credit Agreement and the liquidation
and payment of the liabilities in full, this Agreement shall terminate and
the Collateral will be returned forthwith to the Pledgor.
8. The Pledgee shall have no obligation to act in accordance
with any communication by Pledgor or any other party obligated on the
Liabilities or interested in the Collateral, as endorser, guarantor, surety
or otherwise, concerning the liquidation of all or any part of the
Collateral if it shall be the opinion of the Pledgee in the exercise of its
reasonable judgment that the value of the Collateral upon liquidation may be
insufficient to discharge the Liabilities in full. The Pledgee shall in no
event be bound by or obligated to act upon any such communication unless the
same shall be in writing and shall include explicit instructions as to the
disposition requested.
9. Any notice required or permitted hereunder shall be deemed
given if sent in the manner and at the addresses as provided in the Credit
Agreement.
10. To the extent required by law for purposes of providing
qualifying shares of stock to members of the board of directors of the bank
institutions owned by Pledgor, Pledgee agrees to release such number of
qualifying shares from the lien of this Agreement. To effect such release,
Pledgee will deliver the certificate for the shares of stock of the subject
banking institution to the Pledgor on a trust receipt basis and with the
obligation of Pledgor to return the reissued certificate to Pledgee within
forty-eight (48) hours of the delivery to Pledgor. At the request of
Pledgee, Pledgor agrees to cause such members of the board of directors to
pledge such qualifying shares to Pledgee for the benefit of the Banks as
additional collateral for the Liabilities. Any such qualifying shares
shall, upon issuance, contain an appropriate legend describing the
restrictions and covenants set forth in this Agreement.
57
11. This agreement shall be construed in accordance with and
governed by Missouri law.
12. Pledgor warrants and represents to Pledgee that the shares
of stock of each institution as listed on Exhibit A on the date hereof
---------
represent all of the outstanding shares of stock of each respective
institution (except for directors' qualifying shares and except with respect
to First Banks America, Inc., First Bank FSB and First Commercial Bancorp,
Inc.). Pledgor represents and warrants that (i) the shares of stock of
First Banks America, Inc. as listed on Exhibit A on the date hereof
---------
represent all of the outstanding shares of Class B common stock issued by
such institution and such shares have ordinary voting power to elect a
majority of the board of directors of First Banks America, Inc., (ii) the
shares of stock of First Commercial Bancorp, Inc. as listed on Exhibit A on
---------
the date hereof represent approximately 61% of the outstanding shares of
stock issued by such institution and such shares have ordinary voting power
to elect a majority of the board of directors of First Commercial Bancorp,
Inc., and (iii) the shares of stock of First Bank FSB as listed on Exhibit B
---------
on the date hereof represent approximately 64% of the outstanding shares of
stock issued by such institution and such shares have ordinary voting power
to elect a majority of the board of directors of First Bank FSB.
Dated at St. Louis, Missouri, as of this 18th day of July, 1996.
FIRST BANKS, INC.
By:---------------------------------
Name:-------------------------------
Title:------------------------------
58
PLEDGE AGREEMENT EXHIBIT A
LIST OF COLLATERAL
------------------
9,994 shares of the common stock of First Bank (Creve Coeur, Missouri) [n/o
First Banks, Inc.]
400,000 shares of the common stock of First Bank (O'Fallon, Illinois) [n/o
First Banks, Inc.]
96,254 shares of the common stock of First Bank FSB [n/o First Banks, Inc.]
2,500,000 shares of the Class B Common Stock of First Banks America, Inc.
[n/o First Banks, Inc.]
10,000 shares of the common stock of River Valley Holdings, Inc. [n/o First
Banks, Inc.]
100 shares of the common stock of St. Charles Federal Savings and Loan
Association [n/o First Banks, Inc.]
457 shares of the common stock of CCB Bancorp, Inc. [n/o First Banks, Inc.]
3,100 shares of the Series A Preferred Stock of CCB Bancorp, Inc. [n/o First
Banks, Inc.]
1,000 shares of the Series B Preferred Stock of CCB Bancorp, Inc. [n/o First
Banks, Inc.]
65,000,000 shares of the common stock of First Commercial Bancorp, Inc. [n/o
First Banks, Inc.]
59
EXHIBIT G-1
-----------
SUBSIDIARY PLEDGE AGREEMENT
---------------------------
In consideration of and as collateral security for the payment
of any and all present and future indebtedness, obligations and liabilities
of First Banks, Inc., a Missouri corporation ("Borrower"), whether direct or
indirect, liquidated or unliquidated, absolute or contingent, now existing
or hereafter arising, under or pursuant to that certain Secured Credit
Agreement of even date herewith (together with any extensions, renewals,
amendments or modifications thereof, the "Credit Agreement") among Borrower
and The Boatmen's National Bank of St. Louis ("Boatmen's"), Norwest Bank
Minnesota, National Association, Harris Trust and Savings Bank, American
National Bank and Trust Company of Chicago and The Frost National Bank
(collectively the "Banks"), all such indebtedness, obligations and
liabilities, whether direct or indirect, liquidated or unliquidated,
absolute or contingent, now existing or hereafter arising, individual,
joint, or joint and several (collectively, the "Liabilities"), and in
consideration of the benefit conferred upon Pledgor (as defined below) as a
result of Boatmen's willingness to enter into the Credit Agreement,
- -------------------------- ("Pledgor"), a subsidiary of Borrower, hereby
pledges to Boatmen's as agent for and for the ratable benefit of the Banks
(as agent of the Banks, Boatmen's is referred to hereafter as "Pledgee") and
grants Pledgee a continuing security interest in the capital stock of a
Subsidiary as described on Exhibit A attached hereto and incorporated herein
---------
(together with any additional stock described in Section 4 hereof,
collectively, the "Stock"), together with all substitutions therefor and
dividends, new shares or warrants, liquidating distributions and other
rights, and proceeds or distributions of any nature associated therewith,
all of which Pledgor hereby represents and warrants that it owns (or, for
purposes of Section 4, will own) free of liens or claims of any kind, with
fully marketable title thereto, and has (or shall have) the right to so
pledge.
Pledgor agrees that said Stock, together with the proceeds
thereof (hereinafter collectively called the "Collateral," such term as used
herein shall include any underlying security for any note or other evidence
of a monetary obligation pledged hereunder) shall constitute security for
any and all of the Liabilities and may be held, in accordance with the terms
and provisions of this Agreement, for the payment thereof for such periods
and applied thereto at such times and in such order as the Pledgee from time
to time may deem appropriate, whether or not the Liabilities for which the
same are held or applied are in existence at the time of delivery of this
Agreement or the Collateral and whether or not such Liabilities are
contingent, unliquidated or unmatured.
Pledgor further agrees that:
1. Pledgor will keep the Collateral free from all other
security interests, liens or encumbrances except those security interests,
liens or encumbrances now or hereafter granted to the Pledgee. Pledgor will
procure, execute, endorse and deliver all documents which the Pledgee may
reasonably require to protect, enforce or otherwise effectuate the Pledgee's
rights in the Collateral and Pledgor hereby grants to the Pledgee an
irrevocable power of attorney, with full power of substitution, to so act in
Pledgor's name with respect to the Collateral if Pledgor fails to do so.
2. Except as otherwise expressly provided under Paragraph 3
hereof, the Pledgee may collect and receive distributions relating to the
Collateral or any part thereof at any time. For such purpose the Pledgee
may take, in its own name or in the name of Pledgor, any action which
Pledgor might take. The Pledgee shall have no obligation, however, to
pursue or preserve remedies with respect to the Collateral or otherwise to
take action which Pledgor might have taken as regards the Collateral.
60
3. Pledgee shall have the continuing right to retain all or
any part of the Collateral so long as any Liability remains in existence (or
the Banks shall have any Commitment under the Credit Agreement), even though
the same may be unliquidated, unmatured or contingent. Upon maturity of any
of the Liabilities or the occurrence of an Event of Default under the Credit
Agreement or hereunder, the Pledgee may cause any of the Collateral to be
transferred to its own name or to the name of its nominee (and this shall be
full authority to any transfer agent, registrar or the like to make such
transfer). No such action shall be deemed a retention of the Collateral in
satisfaction of any Liability unless written notice so stating shall be
given to the Pledgor. The Pledgee shall have the sole right to determine
whether any call or option to surrender, exchange, redeem, convert or
otherwise change or alter the form of the Collateral shall be exercised if
the interest of Pledgee is or may be affected thereby. The Pledgee shall be
under no obligation to initiate any such action unless requested in writing
by the Pledgor. All dividends, new shares or warrants, liquidating
distributions and other rights, proceeds and payments or distributions of
any nature received by Pledgor in respect of the Collateral will be
delivered to the Pledgee in kind and the Pledgee may take such action as is
necessary to assure its direct receipt thereof, provided however that, prior
to the occurrence of an Event of Default under the Credit Agreement or
hereunder, Pledgor shall be permitted to retain permitted ordinary dividends
and interest paid in cash and shall retain the right to vote with respect to
the Collateral.
4. In the event that Pledgor, after the date hereof, acquires
stock of any bank, bank holding company, thrift institution or savings
holding company which is or by virtue of such acquisition becomes a
Subsidiary as defined in the Credit Agreement, Pledgor promptly shall (i)
grant to Pledgee a security interest in such stock as additional security
for the Liabilities, (ii) deliver to Pledgee the certificates representing
such stock, along with fully-executed stock powers therefor, and (iii) take
such other action and execute and deliver such other documents to Pledgee as
Pledgee reasonably may require in connection therewith.
5. The following severally shall be considered events of
default for purposes of this Agreement: (a) if any representation, warranty
or statement of fact made by Pledgor hereunder shall prove to be false or
misleading in any material respect, and such default remains unremedied for
thirty (30) consecutive calendar days after notice thereof shall have been
given to Pledgor by the Pledgee, (b) Pledgor's failure to perform any of its
obligations hereunder, and such failure remains unremedied for thirty (30)
consecutive calendar days after notice thereof shall have been given to
Pledgor by the Pledgee, (c) an Event of Default occurs under the Credit
Agreement, or (d) seizure of any of the Collateral or sale or encumbrance
thereof or the failure to pay any tax thereon when due (except any tax
contested in good faith for which reserves for payment satisfactory to
Pledgee have been provided by the Pledgor).
6. Upon maturity of any of the Liabilities (by acceleration
or otherwise) or the occurrence of an event of default hereunder, the
Pledgee may resort to the Collateral at such times and in such order as it
elects and may apply the Collateral to the Liabilities in like manner and
without regard to whether application is made to an obligation of the owner
of the Collateral so applied. If any of the Collateral is owned by someone
other than Pledgor, the Pledgee may elect to apply such Collateral in any
proportion to obligations of the owner or owners to the Pledgee without
regard to the Liabilities. In addition, the Pledgee shall have all rights
of a secured party under the Missouri Uniform Commercial Code and shall
apply the proceeds of collection, disposition or other realization on the
Collateral to reasonable attorneys' fees and legal expenses incurred by the
Pledgee in connection therewith and in the collection of any Liabilities and
representation of the Pledgee in proceedings of any nature under the
Bankruptcy Code, and thereafter as required by law. If notice of intended
disposition is required by law, such notice, if mailed, shall be deemed
reasonably and properly given if mailed to the address of Pledgor appearing
on the records of the Pledgee at least five (5) Business Days (as defined in
the Credit Agreement) before the time of such disposition. The Pledgee
shall have the right to proceed against the Collateral or not as the Pledgee
may deem proper or as directed by the Majority (as
61
defined in the Credit Agreement), and the Pledgee shall have the right to
collect dividends, interest and such like profits from the Collateral whether
or not it proceeds against the Collateral. If, in the opinion of the Pledgee,
any Collateral cannot be disposed of in a commercially reasonable manner
without registration under applicable securities laws, Pledgor will take or
cause to be taken such action as is necessary to effect proper registration.
If Pledgor shall refuse to take such action, the Pledgee at its election, but
without any obligation to do so, may take such action as it deems warranted
to attempt to effect compliance with any applicable law. Any cost, fee or
expense incurred by the Pledgee in connection with such efforts or in
enforcing Pledgor's covenants hereunder will be considered a cost incurred
in disposition of the Collateral.
7. The Pledgee's rights hereunder shall continue unimpaired
notwithstanding foreclosure or other disposition of any part of the
Collateral, the availability of additional Collateral, any release of or
substitution for any of the Collateral, any act or omission impairing the
Pledgee's lien on the Collateral or the lien of any underlying security
constituting part of the Collateral, including failure to perfect the same,
any extension (including extension of time for payment), renewal,
substitution, alteration, compromise, settlement, surrender, release or
other such agreement or action modifying or varying the terms of or
otherwise affecting any of the Liabilities or any part of the Collateral,
including any act or omission releasing any party primarily or secondarily
liable on the Collateral or on any Liability. No failure by Pledgee to
exercise or delay in exercising any of its rights hereunder shall constitute
a waiver thereof and no single or partial exercise of any right shall
preclude the further exercise thereof or the exercise of any other right.
All rights of the Pledgee hereunder or under any instrument or other
agreement binding on Pledgor are cumulative and not in substitution of any
other rights at law or equity with respect to the Collateral or the
collection of the Liabilities. All such rights may be exercised from time
to time. Pledgor hereby waives notice of any and all actions, forbearances
and omissions of any rights contemplated by this paragraph and consents to
be bound thereby as effectively as if Pledgor had agreed thereto in advance.
Upon the termination of the Credit Agreement and the liquidation and payment
of the Liabilities in full, this Agreement shall terminate and the
Collateral will be returned forthwith to the Pledgor.
8. The Pledgee shall have no obligation to act in accordance
with any communication by Pledgor or any other party obligated on the
Liabilities or interested in the Collateral, as endorser, guarantor, surety
or otherwise, concerning the liquidation of all or any part of the
Collateral if it shall be the opinion of the Pledgee in the exercise of its
reasonable judgment that the value of the Collateral upon liquidation may be
insufficient to discharge the Liabilities in full. The Pledgee shall in no
event be bound by or obligated to act upon any such communication unless the
same shall be in writing and shall include explicit instructions as to the
disposition requested.
9. Pledgor agrees that it will not (a) sell or otherwise
dispose of, or grant any option with respect to, any of the Collateral or
(b) create, incur, assume or suffer to exist any Lien upon or with respect
to any of the Collateral except in favor of the Pledgee.
10. Any notice required or permitted hereunder shall be deemed
given if sent in the manner as provided in the Credit Agreement and (i) if
to Pledgee, directed to the address of Boatmen's as provided in the Credit
Agreement and (ii) if to Pledgor, directed to the address of Borrower as
provided in the Credit Agreement.
11. To the extent required by law for purposes of providing
qualifying shares of stock to members of the board of directors of the bank
institutions owned by Pledgor, Pledgee agrees to release such number of
qualifying shares from the lien of this Agreement. To effect such release,
Pledgee will deliver the certificate for the shares of stock of the subject
banking institution to the Pledgor on a trust receipt basis and with the
obligation of Pledgor to return the reissued certificate to Pledgee within
forty-eight (48) hours of the delivery to Pledgor. At the request of
62
Pledgee, Pledgor agrees to cause such members of the board of directors to
pledge such qualifying shares to Pledgee for the benefit of the Banks as
additional collateral for the Liabilities. Any such qualifying shares
shall, upon issuance, contain an appropriate legend describing the
restrictions and covenants set forth in this Agreement.
12. Pledgor acknowledges that Pledgee's willingness to enter
into the Credit Agreement will directly facilitate Borrower's ability to
provide financial support and/or other services for Pledgor's benefit, and
that Pledgee would be unwilling to enter into the Credit Agreement but for
execution and delivery of this Agreement.
13. This agreement shall be construed in accordance with and
governed by Missouri law.
14. Pledgor warrants and represents to Pledgee that the shares
of stock of the institution listed on Exhibit A on the date hereof represent
all of the outstanding shares of stock of such institution (except for
directors' qualifying shares).
[The remainder of this page is intentionally left blank.]
63
Dated at St. Louis, Missouri, as of this 18th day of July, 1996.
------------------------------------------
By:---------------------------------------
Name:-------------------------------------
Title:------------------------------------
64
EXHIBIT A TO SUBSIDIARY PLEDGE AGREEMENT
----------------------------------------
LIST OF COLLATERAL
65
EXHIBIT H
---------
CERTIFICATE OF COMPLIANCE
-------------------------
This Certificate of Compliance is being submitted on this ------
day of ---------------, ------, for the quarter ending on the ------ day of
- ---------------, ------, pursuant to the terms of the Secured Credit
Agreement dated as of July 18, 1996 ("Credit Agreement"), as the same may be
thereafter amended from time to time, among First Banks, Inc. and the banks
named therein (for whom The Boatmen's National Bank of St. Louis is acting
as Agent).
The undersigned officers of First Banks, Inc., and First Banks, Inc.
jointly and severally certify to the Banks that as of the date hereof:
A. The representations and warranties contained in Article V of the
Credit Agreement are correct as of the date hereof;
B. No Default or Event of Default has occurred and is continuing,
[or would result upon [the making of the Loan] [giving effect to the
Letter of Credit] requested by the accompanying [Notice of
Borrowing] [Letter of Credit Request]];
C. Attached is an accurate listing of the current Affiliates of
First Banks, Inc.;
D. The compliance with the covenants contained in Article VIII of
the Credit Agreement is supported by the following:
8.01. Tier I Leverage Ratio
----------------------
(1) (2) Minimum
Tier I Total Ratio of Ratio
Capital Assets (1) to (2) Permitted
------- ------ ---------- ---------
First Banks, Inc. (consolidated) - - - 5.0%
----
66
8.02. Tier I Leverage Ratio of Subsidiaries
-------------------------------------
(1) (2) Minimum
Tier I Total Ratio of Ratio
Subsidiary Capital Assets (1) to (2) Permitted
- ---------- ------- ------ ---------- ---------
First Bank, Creve Coeur, MO - - - 5.0%
----
First Bank (O'Fallon, Illinois) - - - 5.0%
----
First Bank FSB - - - 5.0%
----
First Banks America, Inc. (consolidated) - - - 5.0%
----
BancTEXAS, N.A. - - - 5.0%
----
St. Charles Federal Savings and Loan Association - - - 5.0%
----
CCB Bancorp, Inc. - - - 5.0%
----
First Bank & Trust - - - 5.0%
----
First Commercial Bancorp, Inc. (consolidated) - - - 1.5%
----
First Commercial Bank - - - 5.0%
----
67
8.03. Tier I Risk Based Capital Ratio
-------------------------------
(2)
Weighted
Risk
Assets and
Off-
(1) Balance Ratio of Minimum
Tier I Sheet (1) to Ratio
Capital Items (2) Permitted
------- ----- --- ---------
First Bank, Creve Coeur, MO ------- ------- - 6.0%
----
First Bank (O'Fallon, Illinois) ------- ------- - 6.0%
----
First Bank FSB ------- ------- - 6.0%
----
First Banks America, Inc. (consolidated) ------- ------- - 6.0%
----
BancTEXAS, N.A. ------- ------- - 6.0%
----
St. Charles Federal Savings and Loan Association ------- ------- - 6.0%
----
CCB Bancorp, Inc. ------- ------- - 6.0%
----
First Bank & Trust - - - 6.0%
----
First Commercial Bancorp, Inc. (consolidated) - - - 2.4%
----
First Commercial Bank - - - 6.0%
----
8.04. Total Risk Based Capital Ratio
------------------------------
(2)
Weighted
Risk
Assets and
Off-
(1) Balance Ratio of Minimum
Tier I Sheet (1) to Ratio
Capital Items (2) Permitted
------- ----- --- ---------
First Bank, Creve Coeur, MO ------- ------- - 10.0%
-----
First Bank (O'Fallon, Illinois) ------- ------- - 10.0%
-----
First Bank FSB ------- ------- - 10.0%
-----
First Banks America, Inc. (consolidated) ------- ------- - 10.0%
-----
BancTEXAS, N.A. ------- ------- - 8.0%
-----
St. Charles Federal Savings and Loan Association ------- ------- - 10.0%
-----
CCB Bancorp, Inc. ------- ------- - 10.0%
68
First Bank & Trust ------- ------- - 10.0%
-----
First Commercial Bancorp, Inc. (consolidated) ------- ------- - 3.7%
-----
First Commercial Bank ------- ------- - 10.0%
-----
8.05 Loan Loss Reserve
-----------------
(1) Ratio of
Loan (2) (1) to Minimum
Loss Total -- Ratio
Reserve Loans (2) Permitted
------- ----- --- ---------
First Banks, Inc. (consolidated) ------- ------- - 1.25%
-----
8.06 Net Income to Average Total Assets
----------------------------------
(1)
Net Income
less Gain on
Sale of
Securities
and other
extra-
ordinary (2) Ratio of
and/or non- Average (1) to Minimum
recurring Total -- Ratio
items Assets (2) Permitted
----- ------ --- ---------
First Banks, Inc. (consolidated) ------- ------- - 0.65%
(1996 Fiscal Year) -----
First Banks, Inc. (consolidated) ------- ------- - 0.70%
(1997 Fiscal Year and thereafter) -----
8.07 Non-Performing Assets
---------------------
(1) Ratio of
Non- (2) (1) to Minimum
Performing Primary -- Ratio
Assets Capital (2) Permitted
------ ------- --- ---------
First Banks, Inc. (consolidated) ------- ------- - 25%
---
E. [For borrowing and letters of credit issuance only] The use of
proceeds of the requested Loan will be as indicated in the
accompanying Notice of Borrowing. [or] The purpose of the Letter
of Credit will be as described in Section 3.13 of the Credit
Agreement.
69
Signed as of the day and year first above written.
FIRST BANKS, INC.
(at least two signatures required)
By:----------------------------------
Chief Executive Officer/ President
By:----------------------------------
Chief Financial Officer
By:----------------------------------
Vice President - Chief Accounting Officer
By:--------------------------------
Chief Credit Officer
70
EXHIBIT I
---------
FORM OF LETTER OF CREDIT
--------------------
IRREVOCABLE LETTER OF CREDIT NO. ----------
BENEFICIARY:
[BENEFICIARY NAME]
[BENEFICIARY ADDRESS]
[CITY, STATE ZIP]
DEAR -------------:
WE HEREBY ESTABLISH IN YOUR FAVOR, UPON THE APPLICATION OF AND
FOR THE ACCOUNT OF FIRST BANKS, INC., 135 MERAMEC AVENUE, ST. LOUIS,
MISSOURI 63105 ("FIRST BANKS"), OUR IRREVOCABLE STANDBY LETTER OF CREDIT
NUMBER ------- (THE "LETTER OF CREDIT") IN THE AMOUNT OF $--------------
(THE "AVAILABLE BALANCE"), SUBJECT TO REDUCTION AS HEREINAFTER SET FORTH.
FOR INFORMATION ONLY: THIS LETTER OF CREDIT IS ISSUED WITH
RESPECT TO THE ISSUANCE TO YOU OF A PROMISSORY NOTE BY FIRST BANKS PURSUANT
TO THE AGREEMENT AND PLAN OF REORGANIZATION BY AND AMONG FIRST BANKS, ST.
CHARLES FEDERAL BANCSHARES INC. AND ST. CHARLES ACQUISITION COMPANY, DATED
AS OF MARCH 28, 1994.
THIS LETTER OF CREDIT WILL BE REDUCED WITHOUT AMENDMENT OR
FURTHER NOTIFICATION TO THE BENEFICIARY IN ACCORDANCE WITH THE FOLLOWING
SCHEDULE:
DATE OF REDUCTION AMOUNT OF REDUCTION AVAILABLE BALANCE
- ----------------- ------------------- -----------------
FEBRUARY 17, 1997 $0
------------------- ----
SUBJECT TO THE TERMS AND CONDITIONS OF THIS LETTER OF CREDIT, AN
AMOUNT NOT TO EXCEED THE AVAILABLE BALANCE HEREUNDER SHALL BE MADE AVAILABLE
UPON PRESENTATION TO US OF YOUR SIGHT DRAFT(S) DRAWN ON THE BOATMEN'S
NATIONAL BANK OF ST. LOUIS, ST. LOUIS, MISSOURI, IRREVOCABLE LETTER OF
CREDIT NO. --------, ACCOMPANIED BY THE FOLLOWING DOCUMENTS:
(i) YOUR SIGNED STATEMENT THAT "THIS DRAFT REPRESENTS THE
AMOUNT OF A PRINCIPAL AND INTEREST PAYMENT DUE (BY ACCELERATION OR
OTHERWISE) ON THE PROMISSORY NOTES DATED NOVEMBER 30, 1994 EXECUTED BY FIRST
BANKS, INC. TO THE ORDER OF CERTAIN PERSONS WHO ELECTED TO RECEIVE SUCH
NOTES IN CONNECTION WITH THE ACQUISITION OF
71
ST. CHARLES FEDERAL BANCSHARES INC. BY FIRST BANKS, INC. THIS AMOUNT IS
UNPAID AFTER THE EXPIRATION OF ALL APPLICABLE CURE PERIODS, ALTHOUGH JUSTLY
DUE AND OWING."; AND
(ii) THIS ORIGINAL LETTER OF CREDIT AND AMENDMENTS, IF ANY.
THE DRAFT(S) DRAWN UNDER THIS LETTER OF CREDIT MUST BE DRAWN AND
PRESENTED TO OUR OFFICE AT ONE BOATMEN'S PLAZA, 800 MARKET STREET, ST.
LOUIS, MISSOURI 63101, ATTENTION: LETTER OF CREDIT DEPARTMENT (OR SUCH
OTHER OFFICE, DEPARTMENT OR ADDRESS DESIGNATED IN WRITING BY US TO YOU AT
YOUR ADDRESS SHOWN ABOVE OR AT SUCH OTHER ADDRESS AS YOU SHALL ADVISE US OF
IN WRITING).
FAILURE TO DRAW FOR A PARTICULAR INSTALLMENT SHALL NOT AFFECT
YOUR RIGHT TO DRAW FOR FUTURE INSTALLMENTS.
WE HEREBY AGREE THAT ALL DRAFTS DRAWN UNDER AND IN COMPLIANCE
WITH THE TERMS OF THIS LETTER OF CREDIT WILL BE DULY HONORED BY US UPON
DELIVERY OF THE CERTIFICATE(S) AND DOCUMENTS AS SPECIFIED ABOVE AND IF
PRESENTED AT OUR AFORESAID OFFICE ON OR BEFORE THE EXPIRATION DATE (AS
DEFINED BELOW).
THIS LETTER OF CREDIT IS EFFECTIVE IMMEDIATELY AND EXPIRES ON
THE EARLIER OF (I) FEBRUARY 17, 1997, (II) WHEN YOU HAVE DRAWN AND WE HAVE
PAID TO YOU THE AVAILABLE BALANCE OF THIS LETTER OF CREDIT, (III) THE DAY ON
WHICH THE AVAILABLE BALANCE OF THIS LETTER OF CREDIT IS REDUCED TO $0.00
PURSUANT TO THE TERMS HEREOF, OR (IV) THE DAY ON WHICH THIS LETTER OF CREDIT
IS SURRENDERED TO US FOR CANCELLATION.
THIS LETTER OF CREDIT IS TRANSFERRABLE ON ONE OR MORE OCCASIONS,
SUBJECT TO THE PAYMENT OF OUR USUAL TRANSFER COMMISSION ACCOMPANIED BY YOUR
INSTRUCTIONS IN A FORM SATISFACTORY TO US. TRANSFER FORM INSTRUCTION WILL
BE FURNISHED UPON REQUEST.
THIS LETTER OF CREDIT SHALL BE GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF MISSOURI, BUT SUBJECT, HOWEVER, TO THE UNIFORM CUSTOMS AND
PRACTICE FOR DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF
COMMERCE, PUBLICATION 500, EXCLUSIVE, HOWEVER, OF ARTICLE 41 THEREOF.
VERY TRULY YOURS,
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
BY:------------------------------------
AUTHORIZED OFFICER
72
EXHIBIT J
---------
LETTER OF CREDIT REQUEST
No. --------<F1>------------ Dated --------, 199-- <F2>
---- ----
To: The Boatmen's National Bank of St. Louis, in its capacity as the Agent
under the Secured Credit Agreement, dated as of July 18, 1996 (as amended,
modified or supplemented from time to time, the "Agreement"), among FIRST
BANKS, INC., a Missouri corporation, (the "Borrower"), THE BOATMEN'S
NATIONAL BANK OF ST. LOUIS, NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
HARRIS TRUST AND SAVINGS BANK, AMERICAN NATIONAL BANK AND TRUST COMPANY OF
CHICAGO and THE FROST NATIONAL BANK
Dear Sirs:
We hereby request that you issue a Letter of Credit on
- ----------<F3>--------- (the "Date of Issuance") in the aggregate stated
----
amount of --------<F4>-------.
----
For purposes of this Letter of Credit Request, unless otherwise
defined, all capitalized terms used herein which are defined in the
Agreement shall have the respective meanings provided therein.
The beneficiary of the requested Letter of Credit will be
- --------<F5>-------, and such Letter of Credit will be in support of --------
----
<F6>------ and will have a stated termination date of --------<F7>-------.
- ---- ----
[FN]
- --------------------------------------------------
<F1> Letter of Credit Request Number.
- ----
<F2> Date of Letter of Credit Request (at least two Business Days prior to
- ---- the Date of Issuance).
<F3> Date of Issuance.
- ----
<F4> Aggregate initial stated amount of Letter of Credit.
- ----
<F5> Insert name and address of beneficiary.
- ----
<F6> Insert description of supported obligations and name of agreement to
- ---- which it relates.
<F7> Insert last date upon which drafts may be presented.
- ----
73
Copies of all documentation with respect to the supported
transaction are attached hereto.
FIRST BANKS, INC.
By:---------------------------------
Name:
Title:
74
EXHIBIT K
---------
FORM OF BORROWER'S COUNSEL OPINION
----------------------------------
July 18, 1996
The Boatmen's National Bank Harris Trust and
of St. Louis Savings Bank
One Boatmen's Plaza 111 W. Monroe
St. Louis, Missouri 63101 Chicago, Illinois 60603
Norwest Bank Minnesota, National Association American National Bank and Trust
100 East Wisconsin Avenue Company of Chicago
Milwaukee, Wisconsin 63202-4101 33 North LaSalle Street
Chicago, Illinois 60690
The Frost National Bank
100 West Houston Street
San Antonio, Texas 78205
Re: The Boatmen's National Bank of St. Louis - $90,000,000
Secured Credit Agreement with First Banks, Inc.
---------------------------------------
Ladies and Gentlemen:
We have acted as counsel for First Banks, Inc., a Missouri
corporation, (the "Borrower") and as counsel to First Bank (Creve Coeur,
Missouri), a Missouri state banking corporation ("FB-Creve Coeur"), First
Bank (O'Fallon, Illinois), an Illinois state banking corporation
("FB-Illinois"), First Bank FSB, a federal savings bank ("FB-FSB"), First
Banks America, Inc., a Delaware corporation ("FB-America"), River Valley
Holdings, Inc., an Illinois bank holding company ("River Valley"), St. Charles
Federal Savings and Loan Association, a federal savings and loan association
("St. Charles"), CCB Bancorp, Inc., a Delaware corporation ("CCB"), First Bank
& Trust ("FB&T"), a California state banking corporation, and First Commercial
Bancorp, Inc., a Delaware corporation ("FCB") (FB-Creve Coeur, FB-Illinois,
FB-FSB, FB-America, River Valley, St. Charles, CCB, FB&T, and FCB are
sometimes individually referred to herein as a "Pledged Subsidiary" and
sometimes collectively referred to herein as the "Pledged Subsidiaries") in
connection with the above-referenced loan (the "Loan"). This opinion is
being furnished to you as required by Section 4.01(5) of the Secured Credit
Agreement executed on this date by the Borrower and The Boatmen's National
Bank of St. Louis ("Boatmen's"), Norwest Bank Minnesota, National
Association, Harris Trust and Savings Bank, American National Bank and Trust
Company of Chicago, and The Frost National Bank (collectively, the "Banks").
Capitalized terms not otherwise defined herein shall have the meaning
ascribed to them in that certain Secured Credit Agreement dated as of July
18, 1996 among the Borrower and the Banks (the "Credit Agreement").
In connection with the preparation of this opinion, we have
reviewed the following instruments and documents executed by the respective
parties thereto (the "Loan Documents"):
75
1. Each of the Notes, dated July 18, 1996, in the aggregate
maximum principal face amount of $90,000,000 executed by the Borrower as
maker and payable to the order of the Banks as set forth in Sections 2.07
and 3.06 of the Credit Agreement;
2. The Credit Agreement;
3. Pledge Agreement dated July 18, 1996 executed by the
Borrower, as Pledgor, to Boatmen's, as agent for the Banks, as Pledgee;
4. Subsidiary Pledge Agreements dated July 18, 1996 executed
by CCB Bancorp, Inc. and River Valley Holdings, Inc., as Pledgors, to
Boatmen's, as agent for the Banks, as Pledgee;
5. The certificates representing the shares of capital stock
of the Pledged Subsidiaries; and
6. Irrevocable Stock Powers executed by the Pledgor.
In our capacity as counsel for the Borrower and the Pledged
Subsidiaries, we have examined originals or copies of such other documents,
records and other instruments as we have deemed necessary or appropriate for
the purposes of this opinion, including, without limitation, the following:
A. Articles of Incorporation and Bylaws of the Borrower;
B. Resolutions adopted by the Board of Directors of the
Borrower; and
C. Articles of Association or Articles of Incorporation, as
the case may be, and Bylaws of each of the Pledged Subsidiaries.
In rendering this opinion, we have assumed the genuineness of
all signatures on documents, statements and certificates reviewed by us, the
accuracy and authenticity of all documents, statements and certificates
reviewed by us, and the conformity to authentic original documents of all
documents, statements and certificates submitted to us as certified,
conformed and photostatic copies.
In those instances in which our opinion is rendered "to the best
of our knowledge", it is intended to indicate that during the course of our
representation, no information has come to the attention of those attorneys
within our firm who have performed legal services in connection with the
representation described in this letter that would give us actual knowledge
of the inaccuracy of such statement; and unless otherwise specified herein,
is not based upon any independent investigation to determine the accuracy of
such statement, and no inference as to our knowledge should be drawn from
the fact of our representation of the Borrower or the Pledged Subsidiaries.
We have no knowledge of any factual information which has led us
to conclude that the documents and certificates we have examined contain any
untrue statement of a material fact.
68
76
Based upon the foregoing, and subject to the qualifications set
forth herein, we are of the opinion under existing law as of the date
hereof, that:
(i) The Borrower is a duly organized and validly existing
corporation, in good standing under the laws of the State of Missouri and
has the corporate power and authority to execute, deliver and perform the
Loan Documents and to own its properties and carry on its business as now
being conducted, and is a duly registered bank holding company in good
standing under the Bank Holding Company Act of 1956, as amended.
2. FB-Creve Coeur is duly organized and validly existing and
is in good standing as a state bank under the laws of the State of Missouri;
FB-Illinois is duly organized and validly existing and is in good standing
as a state bank under the laws of the State of Illinois; FB-FSB is duly
organized and validly existing as a federal savings bank under the laws of
the United States; FB-America is duly organized and validly existing and is
in good standing as a bank holding company under the laws of the State of
Delaware; River Valley is duly organized and validly existing and is in good
standing as a bank holding company under the laws of the State of Delaware;
St. Charles is a duly organized and validly existing and is in good standing
as a federal savings and loan association under the laws of the United
States; CCB is duly organized and validly existing and is in good standing
as a corporation under the laws of the State of Delaware; FB&T is duly
organized and validly existing and is in good standing as a state bank under
the laws of the State of California, and FCB is duly organized and validly
existing and is in good standing as a corporation under the laws of the
State of Delaware.
3. The Pledged Subsidiaries have the corporate power and
adequate corporate authority to own their property and to carry on their
businesses as now conducted.
4. The Loan Documents have each been duly authorized,
executed and delivered by the Borrower and constitute the legal, valid and
binding obligations of the Borrower enforceable in accordance with their
respective terms, subject, as to the enforcement of remedies, to applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors' rights generally, and subject to general
principles of equity (including the exercise of judicial discretion in
accordance with such principles), regardless of whether such enforceability
is considered in a proceeding at law or in equity. Notwithstanding anything
contained in this letter to the contrary, this firm is providing no opinion
as to the enforceability of Section 9.01(13) of the Credit Agreement.
5. No consent or approval of or registration with any
federal, state or local government or regulatory authority is required in
connection with the Loan or the execution and delivery of the Loan
Documents. Neither (i) the execution and delivery by the Borrower of the
Loan Documents, (ii) the consummation of the transactions contemplated
thereby, nor (iii) the
69
77
compliance by the Borrower with any of the provisions thereof, will conflict
with or result in a violation or breach of the material terms or provisions
of, or constitute a default under the Borrower's Articles of Incorporation or
Bylaws or any rule, regulation, order, writ, judgment or decree of which we
have knowledge of any court or government agency or instrumentality, or any
agreement or instrument of which we have knowledge and to which the Borrower
is a party or with respect to which the Borrower is bound and which would
materially adversely affect the Borrower's ability to perform its obligations
under the Loan Documents.
6. To the best of our knowledge, limited to reasonable
inquiry of the officers of the Borrower, there are no actions, suits or
proceedings pending or threatened, affecting the Borrower or any of its
subsidiaries or affiliates, at law or in equity, before or by any federal,
state, local or other governmental department, commission, board, bureau,
agency or authorities, the result of which would materially and adversely
affect the Borrower's ability to perform under the Loan Documents or which
would have a material adverse affect upon the Borrower or such subsidiary or
affiliate.
7. To the best of our knowledge, limited to reasonable
inquiry of the officers of the Borrower, there exists no default by the
Borrower or any Pledged Subsidiary with respect to any order, writ,
injunction, or other decree by a court or any other governmental department,
commission, board, bureau, agency or instrumentality.
8. The capital stock of each of the Pledged Subsidiaries
listed on Exhibit L to the Credit Agreement has been duly authorized
---------
and validly issued and is fully paid and nonassessable (except with regard
to First Bank & Trust) and free of preemptive rights, and, to the best of
our knowledge, limited to reasonable inquiry of the officers of the
Borrower, is owned by the Borrower free and clear of all liens, claims and
encumbrances, except for the security interest created under the Pledge
Agreement and the Subsidiary Pledge Agreements to Boatmen's as agent for the
Banks.
9. Upon delivery of the stock together with executed stock
powers, of each Pledged Subsidiary to the Agent, the Agent, for the benefit
of the Banks, will have a perfected first priority security interest in the
stock of each Pledged Subsidiary pursuant to the Pledge Agreement and the
Subsidiary Pledge Agreements.
10. To the best of our knowledge, limited to reasonable
inquiry of the officers of the Borrower, with respect to the Borrower and
each Pledged Subsidiary, except for the matters disclosed on Schedule
9.01(10) to the Credit Agreement there are no existing orders, agreements or
memoranda from any bank regulatory authority with respect to regulatory
violations or compliance requirements.
The opinions expressed herein are limited to the applicable laws
of the United States and the States of Missouri and Illinois and no opinion
is expressed with respect to the laws of any
70
78
other jurisdiction or state with respect to the effect of any such laws on the
matters dealt with herein.
As to various questions of fact material to these opinions, we
have relied upon the truth of various representations and warranties of the
Borrower contained in the Loan Documents and upon such representations and
certificates of officers of the Borrower and the Pledged Subsidiaries as are
provided on Exhibit A attached hereto.
This opinion is provided solely for the purpose of complying
with the requirements of the Loan Documents and, without our prior written
consent, may not be relied upon by any person, firm or entity whatsoever
other than each of the Banks and its or their respective successors and
assigns.
Very truly yours,
71
79
EXHIBIT L
---------
PLEDGED SUBSIDIARIES
--------------------
First Bank (Creve Coeur, Missouri)
First Bank (O'Fallon, Illinois)
First Bank FSB
First Banks America, Inc.
River Valley Holdings, Inc.
St. Charles Federal Savings and Loan Association
CCB Bancorp, Inc.
First Commercial Bancorp, Inc.
First Bank & Trust
72
80
EXHIBIT M
---------
LIST OF AFFILIATES
------------------
Hermanhoff Winery, Inc.
Tidal Insurance, Ltd.
First Securities of America, Inc.
First Services, L.P.
Southside Bancshares, Inc.
First Brokerage, L.P.
Investors of America, Limited Partnership
73
81
EXHIBIT N
---------
IDENTIFICATION
OF
FINANCIAL STATEMENTS
--------------------
(1) Audited consolidated financial statements for First Banks, Inc. and
subsidiaries for the fiscal years ending December 1994 and 1995.
(2) Audited consolidated financial statements for First Banks America,
Inc. and subsidiaries for the fiscal years ending December 1994 and 1995.
(3) Audited consolidated financial statements for First Commercial
Bancorp, Inc. and subsidiaries for the fiscal years ending December 1994 and
1995.
(4) Unaudited consolidated financial statements for First Banks, Inc. and
its subsidiaries, both prepared by Borrower, for the period ending March 31,
1996.
(5) Unaudited consolidated financial statements for First Banks America,
Inc. and its subsidiaries, both prepared by Borrower, for the period ending
March 31, 1996.
(6) Unaudited consolidated financial statements for First Commercial
Bancorp, Inc. and its subsidiaries, both prepared by Borrower, for the
period ending March 31, 1996.
74
82
EXHIBIT O
---------
OWNERSHIP OF SUBSIDIARIES
--------------------------
FIRST BANK-ILLINOIS
400,000 Shares Owned/Controlled By First Banks, Inc. (100%)
FIRST BANK (MISSOURI)
9,994 Shares Owned/Controlled By First Banks, Inc. Plus 6 Directors
Qualifying Shares (100%)
RIVER VALLEY HOLDINGS, INC.
10,000 Shares Owned/Controlled by First Banks, Inc. (100%)
FIRST BANK FSB
96,254 Common Shares Owned/Controlled by First Banks, Inc. (63.66%)
54,946 Common Shares Owned/Controlled by River Valley Holdings, Inc.
(36.34%)
ST. CHARLES FEDERAL SAVINGS AND LOAN ASSOCIATION
100 Shares Owned/Controlled by First Banks, Inc. (100%)
FIRSTSERV, INC.
30,000 Shares Owned/Controlled by First Banks, Inc. (100%)
FIRST BANKS AMERICA, INC.
2,500,000 Class B Shares Owned/Controlled by First Banks, Inc. (66.20% of
total voting)
SUNDOWNER CORPORATION
10,000 Common Shares Owned/Controlled by First Banks America, Inc. (100%)
BANKTEXAS, N.A.
2,049,000 Common Shares Owned/Controlled by Sundowner Corporation (100%)
FIRST COMMERCIAL BANCORP, INC.
65,000,000 Common Shares Owned/Controlled by First Banks, Inc. (61.45%)
40,775,428 Common Shares Publicly Held (38.55%)
FIRST COMMERCIAL BANK
117,908,667 Common Shares Owned/Controlled by First Commercial
Bancorp, Inc. (100%)
750,000 Preferred Shares Owned/Controlled by First Commercial Bancorp,
Inc. (100%)
CCB BANCORP, INC.
457 Common Shares Owned/Controlled by First Banks, Inc. (100%)
3,100 Shares Series A Preferred 8% Non Cumulative Redeemable
Owned/Controlled by First Banks, Inc. (100%)
1,000 Shares Series B Preferred 8% Non Cumulative Redeemable
Owned/Controlled by First Banks, Inc. (100%)
75
83
FIRST BANK & TRUST
4,700,796 Shares Owned/Controlled by CCB Bancorp, Inc. (100%)
76
84
EXHIBIT P
---------
LIST OF ADDRESSES
-----------------
If to the Borrower: First Banks, Inc.
11901 Olive Blvd.
Creve Coeur, MO 63141
Attention: Allen H. Blake
Chief Financial Officer
with a copy to (for notice requirements under Article IX hereof only):
Greensfelder, Hemker & Gale, P.C.
2000 Equitable Building
10 South Broadway
St. Louis, Missouri 63102
Attention: Sheldon K. Stock, Esq.
If to The Boatmen's National
Bank of St. Louis: 800 Market Street
P.O. Box 236
St. Louis, MO 63166
Attention: David C. Buettner
If to Harris Trust
and Savings Bank: 111 W. Monroe
Chicago, Illinois 60603
Attention: Patrick Horne
If to American National
Bank and Trust Company
of Chicago: 33 North LaSalle St.
Chicago, Illinois 60690
Attention: Lynn Lavender
If to The Frost National
Bank: 350 Bryan Tower
2001 Bryan Street
Dallas, Texas 75201
Attention: Jerry L. Crutsinger
Vice President
Correspondent Banking
If to Norwest Bank
Minnesota, National
Association: 100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202-4101
Attention: Alfonso Buscemi
77
85
SCHEDULE 3.13
OUTSTANDING LETTERS OF CREDIT
-----------------------------
(see attached schedule)
78
86
SCHEDULE 5.05
OTHER AGREEMENTS
----------------
NONE
79
87
SCHEDULE 5.06
LITIGATION
----------
80
88
SCHEDULE 5.08
PLAN TERMINATIONS
-----------------
1. As of December 31, 1993 the First Banks, Inc. Money Purchase Pension
Plan was terminated and replaced effective April 1, 1994 with the First
Banks, Inc. '401K Profit Sharing Plan.
2. Effective March 31, 1994, Heritage National Bank was merged into First
Bank (Creve Coeur, Missouri). Heritage National Bank maintained an Employee
Stock Ownership Plan which, incidental to the First Banks/Heritage National
Bank merger, has been terminated.
81
89
SCHEDULE 9.01(10)
REGULATORY ACTIONS
------------------
The Cease and Desist Order between the Federal Deposit Insurance Corporation
and First Commercial Bank, dated August 17, 1992.
The State Banking Order issued by the State of California, State Banking
Department, Superintendent of Banks to First Commercial Bank, dated August
27, 1992, as amended.
The Memorandum of Understanding between the Federal Reserve Bank of San
Francisco and First Commercial Bancorp, Inc., dated October 17, 1994.
The Memorandum of Understanding between the Federal Reserve Bank of San
Francisco and Sunrise Bancorp, dated September 2, 1994.
The Capital Impairment Order issued by the State of California, State
Banking Department, Superintendent of Banks to First Commercial Bank, dated
March 15, 1996.
The Capital Impairment Order issued by the State of California, State
Banking Department, Superintendent of Banks to First Commercial Bank, dated
June 12, 1996.
82