EXHIBIT 10(s) - PROMISSORY NOTE
FIRST FINANCIAL CORPORATION
PROMISSORY NOTE
$18,000,000.00 Milwaukee, Wisconsin
April 30, 1995
SECTION 1. FOR VALUE RECEIVED, FIRST FINANCIAL CORPORATION, a
Wisconsin corporation (the "Company"), hereby promises to pay to the order of
M&I MARSHALL & ILSLEY BANK, a Wisconsin banking corporation ("M&I"), the
principal sum of EIGHTEEN MILLION AND 00/100 DOLLARS ($18,000,000.00) or such
lesser amount of loans which remain outstanding under this Note on April 30,
1996. The unpaid principal shall bear interest from the date hereof until paid,
computed on the basis of a 360 day year, at an annual rate equal to the prime
rate of interest (the "Prime Rate") adopted by M&I from time to time as the base
rate for interest rate determinations, changing on each day that the Prime Rate
changes. Interest shall be payable monthly in arrears on the first day of each
month in each year, commencing on June 1, 1995 and continuing thereafter until
the principal is paid in full, with a final payment of interest due at maturity.
The Company agrees to pay interest on any overdue amounts at the Prime Rate plus
2%. Each loan shall be in an integral multiple of One Hundred Thousand and
00/100 Dollars ($100,000.00) and shall be made on telephonic notice from an
authorized officer of the Company to M&I. The Company may reborrow any amounts
paid or prepaid on this Note, provided, however, that the aggregate amount of
loans outstanding hereunder shall never exceed $18,000,000.00. All interest
under this Note shall be computed for the actual number of days elapsed on the
basis of a 360 day year.
Payments of both principal and interest are to be made in lawful
money of the United States of America at the offices of M&I Marshall & Ilsley
Bank, Attention: Loan and Discount Department, 770 North Water Street,
Milwaukee, Wisconsin 53201, or at such other place as the holder shall designate
in writing to the maker.
SECTION 2. PREPAYMENT. The Company may, at any time and from time
to time, prepay the loan in whole or in part without premium or penalty. At the
time of making any prepayment, the Company shall pay all accrued interest upon
the amount prepaid.
SECTION 3. The Company hereby waives presentment for payment,
protest and demand, notice of protest, demand and of dishonor and nonpayment of
this Note.
SECTION 4. DEFINITIONS. When used in this Note, the following
terms shall have the meanings specified:
Automatic Event of Default. "Automatic Event of Default" shall
mean any one or more of the following:
(a) the Company or FFB, shall: (i) become insolvent or take or
fail to take any action which constitutes an admission of inability to pay its
debts as they mature, (ii) make a general assignment for the benefit of
creditors or to an agent authorized to liquidate any substantial amount of its
assets, (iii) become the subject of an "order for relief" within the meaning of
the United State Bankruptcy Code, (iv) file a petition in bankruptcy, or for
reorganization, or to effect a plan or other arrangement with creditors, (v)
file an answer to a creditor's petition, admitting the material allegations
thereof, for an adjudication of bankruptcy
-1-
or for reorganization or to effect a plan or other arrangement with creditors,
(vi) apply to a court for the appointment of a receiver or custodian for any of
its assets or properties, or (vii) have a receiver or custodian appointed for
any of its assets or properties, with or without consent, and such receiver
shall be discharged within sixty (60) days after his appointment; or
(b) the Company or FFB adopts a plan of complete liquidation of
its assets.
Consolidated Assets. "Consolidated Assets" shall mean all
consolidated assets of the Company and all Subsidiaries but shall not include
goodwill, patents, trademarks, trade names, copyrights and other assets properly
classified as intangible assets.
Event of Default. "Event of Default" shall mean any automatic
Event of Default and any Notice Event of Default.
FFB. "FFB" means First Financial Bank, F.S.B.
Indebtedness. "Indebtedness" shall mean, as to any Person, all
liabilities or obligations of that Person, whether primary or secondary or
absolute or contingent: (a) for borrowed money, whether secured or unsecured;
(b) evidenced by notes, bonds, debentures, guarantees, endorsements or similar
obligations; (c) for capital lease obligations; (d) secured by any Liens or (e)
for deferred indebtedness whether secured or unsecured, incurred in connection
with the acquisition or carrying of property.
Lien. "Lien" shall mean, with respect to any asset: (a) any
mortgage, pledge, lien, charge, security interest or encumbrance of any kind;
and (b) the interest of a vendor or lessor under any conditional sale agreement,
financing lease or other title retention agreement relating to such asset.
Notice Event of Default. "Notice Event of default" shall mean any
one or more of the following and such failure or default remains uncured for a
period of thirty (30) days after notice of such occurrence is given by M&I to
the Company:
(a) the Company shall fail to pay when due any installment of the
principal of or interest upon this Note;
(b) there shall be a default in the performance or observance of
any of the covenants and agreements contained in this Note;
(c) there shall be a default in the performance or observance of
any of the covenants and agreements contained in the Pledge Agreement or
contained in other instruments delivered by the Company to M&I;
(d) any representation or warranty made by the Company in this
Note or in any document or financial statement delivered to M&I pursuant to this
Note shall prove to have been false in any material respect as of the time when
made or given;
(e) the amount of any final judgment entered against the Company
or any Subsidiary, when added to the amount of all other final judgments against
the Company and all Subsidiaries, exceeds the aggregate amount of $1,000,000 and
such final judgments shall remain outstanding and unsatisfied, unbonded or
unstayed after thirty (30) days from the date of entry thereof; or
-2-
(f) the Company or FFB defaults on any Indebtedness in excess of
$500,000 other than the loans represented by the Note, or the Company's or FFB's
failure to perform or observe any term, covenant or condition for other
Indebtedness in excess of $500,000 if the effect of such failure is to
accelerate such Indebtedness and require such Indebtedness to be prepaid prior
to maturity.
Person. "Person" shall mean and include an individual,
partnership, corporation, trust, incorporated organization and a government or
any department or agency thereof.
Pledge Agreement. "Pledge Agreement" shall mean the Collateral
Pledge Agreement between the Company and M&I dated June 29, 1990, as amended by
the First Amendment to Collateral Pledge Agreement dated as of May 1, 1991
between the Company and M&I, a Second Amendment to Collateral Pledge Agreement
dated as of April 30, 1992, a Third Amendment to Collateral Pledge Agreement
dated as of November 30, 1992, a Fourth Amendment to Collateral Pledge Agreement
dated April 30, 1993, a Fifth Amendment to Collateral Pledge Agreement dated
April 30, 1994, and a Sixth Amendment to Collateral Pledge Agreement dated April
30, 1995, and as further amended from time to time.
Subsidiary. "Subsidiary" shall mean any corporation at least fifty
percent (50%) of the outstanding stock of which (of any class or classes,
however designated, having ordinary voting power for the election of at least a
majority of the members of the board of directors of such corporation, other
than stock having such power only by reason of the happening of a contingency)
shall at the time be owned by the Company directly or through FFB; provided,
however, that an affiliate of FFB shall only be considered a Subsidiary if such
entity is reflected in the annual consolidated and consolidating financial
statements of the Company and all Subsidiaries described in Section 5.5(b)
hereof or in any footnotes to such financial statements.
SECTION 5. Covenants. From and after the date of this Note and
until the entire amount of principal and interest due under the Note and the
entire amounts of fees and payments due under this Note and the Collateral
Pledge Agreement are paid in full:
5.1 Indebtedness. The Company will not, and will cause each
Subsidiary to not, at any time permit the sum of the following described
Indebtedness to exceed 15% of Consolidated Assets:
(a) Indebtedness of the Company and all Subsidiaries to the
Federal Home Loan Bank System; plus
(b) the maximum amount of Indebtedness which the Company and all
Subsidiaries could incur under commitments made by M&I; plus
(c) all other Indebtedness of the Company and all Subsidiaries.
5.2 Asset/Liability Ratio. The Company, on a consolidated basis,
will not at any time allow earning assets that mature or are repriced within one
year to fall below 84% or rise above 116% of liabilities that mature or are
repriced within one year, such assets and liabilities being classified according
to regulatory requirements as reported by the Subsidiaries to the Office of
Thrift Supervision.
5.3 Risk-Based Capital Ratio. The Company shall cause FFB to
maintain at all times Risk-Based Capital, as measured by the Office of Thrift
Supervision, of at least 8% of
-3-
Risk Weighted Assets, as measured by the Office of Thrift Supervision.
5.4 Liquidity. The Company and its Subsidiaries shall maintain
Cash and Interest- earning Deposits, as defined in accordance with generally
accepted accounting principles, of at least 4.5% of Consolidated Assets.
5.5 Reporting Requirements. The Company shall furnish to M&I such
information respecting the business, assets and financial condition of the
Company and the Subsidiaries as M&I may reasonably request and without request
furnish to M&I:
(a) within 45 days after the end of each fiscal quarter in each
fiscal year, a consolidated and consolidating balance sheet of the Company and
all Subsidiaries as of the end of each such fiscal quarter and of the comparable
fiscal quarter in the preceding fiscal year and consolidated and consolidating
statements of income, stockholders equity and cash flow of the Company and all
Subsidiaries for each such fiscal quarter and for that part of the fiscal year
ending with each fiscal quarter and for the corresponding periods of the
preceding fiscal year, all in reasonable detail and certified as true and
correct, subject to audit and normal year-end adjustments, by the chief
financial officer of the Company; and
(b) as soon as available, and in any event within 120 days after
the close of each fiscal year, a copy of the detailed annual audit report for
such year and accompanying consolidated and consolidating financial statements
of the Company and all Subsidiaries prepared in reasonable detail and in
accordance with generally accepted accounting principles consistently applied by
public accountants of recognized standing selected by the Company, and
reasonably satisfactory to M&I, which audit report shall be accompanied by: (i)
an opinion of such accountants, in form and substance reasonably satisfactory to
M&I to the effect that the same fairly presents the consolidated financial
condition and the consolidated results of operations of the Company and all
Subsidiaries for the periods and as of the relevant dates thereof, and (ii) a
certificate of such accountants setting forth their computations as to the
Company's compliance with Sections 5.1, 5.2, 5.3 and 5.4 of this Note and
stating that in the ordinary course of their audit, conducted in accordance with
generally accepted auditing practices, they did not become aware of any Event of
Default or, if their audit disclosed an Event of Default, a specification of the
Event of Default and the actions taken or proposed to be taken by the Company
with respect thereto; and
(c) promptly after the same are available, copies of all such
proxy statements, reports and financial statements as the Company shall send to
its stockholders; and
(d) together with each delivery required by Sections 5.5(a) and
(b) of this Note, a certificate of the Company in form reasonably satisfactory
to M&I as to the Company's compliance with the covenants contained in this Note;
and
(e) promptly after the same are available, copies of all reports
submitted to the Company or any Subsidiary by independent certified public
accountants in connection with any annual or special audit made of the books and
records of the Company or any Subsidiary or relating to the management,
operation, accounting procedures or internal controls of the Company or any
Subsidiary.
5.6 Inspection of Properties and Records. The Company shall, and
shall cause each Subsidiary to, permit representatives of M&I to visit any of
its properties and examine any of its books and records at any reasonable time
and as often as may be reasonably desired and
-4-
facilitate such inspection and examination.
SECTION 6. REMEDIES.
6.1 Acceleration. (a) Upon the occurrence of an Automatic Event of
Default, then, without notice, demand or action of any kind by M&I, the entire
amount of unpaid principal and accrued and unpaid interest under this Note and
the entire amount of unpaid fees and expenses under this Note shall be
automatically and immediately due and payable.
(b) Upon the occurrence of a Notice Event of Default, M&I may, by
written notice to the Company, declare that the entire amount of unpaid
principal and accrued and unpaid interest under this Note and the entire amount
of unpaid fees and expenses under this Note are immediately due and payable.
(c) No remedy herein conferred upon M&I is intended to be
exclusive of any other remedy and each and every such remedy shall be cumulative
and shall be in addition to every other remedy given under this Note or the
Pledge Agreement or now or hereafter existing by law. No failure or delay on the
part of M&I in exercising any right or remedy shall operate as a waiver thereof
nor shall any single or partial exercise of any right preclude other or further
exercise thereof or the exercise of any other right or remedy.
6.2 Fees, Expenses and Attorney's Fees. The Company shall pay all
reasonable fees and expenses incurred by M&I, including the reasonable fees of
counsel, in connection with the maintenance, reissuance and amendment of this
Note, the Pledge Agreement and the consummation of the transactions contemplated
by this Note and the administration, protection or enforcement of M&I's rights
under this Note and the Pledge Agreement.
FIRST FINANCIAL CORPORATION
(CORPORATE SEAL)
By /s/John C. Seramur
--------------------------
John C. Seramur, President
Attest:
/s/Robert M. Salinger
------------------------------
Robert M. Salinger, Secretary
-5-