EXHIBIT 10
SECURED CREDIT AGREEMENT
($125,000,000 Revolving Credit Facility, Including $10,000,000 Swingline
Sub-Facility and $5,000,000 Letter of Credit Sub-Facility)
dated as of August 8, 2007
among
FIRST BANKS, INC.
and
THE LENDERS SIGNATORY HERETO
and
WELLS FARGO BANK, NATIONAL ASSOCIATION
as Agent
WELLS FARGO BANK, NATIONAL ASSOCIATION
as Sole Lead Arranger and Sole Book Runner
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS...............................................................2
Section 1.1 Defined Terms............................................................................2
Section 1.2 Other Interpretive Provisions...........................................................11
ARTICLE II. COMMITMENTS OF THE LENDERS; BORROWING,
CONVERSION AND LETTER OF CREDIT PROCEDURES...........................................................12
Section 2.1 Commitments............................................................................12
2.1.1. Revolving Loan Commitment.............................................................12
2.1.2. Increase of the Revolving Loan Commitments............................................12
2.1.3. Letter of Credit Sub-Facility Commitment..............................................14
2.1.4. Swingline Commitment..................................................................14
2.1.5. Term Loan Conversion and Sub-Facility Commitment......................................14
Section 2.2 Revolving Loan Procedures.............................................................14
2.2.1 Borrowing Procedures..................................................................14
2.2.2 Conversion of Principal to Eurodollar Rates...........................................16
Section 2.3 Letter of Credit Procedures...........................................................18
2.3.1 Issuance/Lender Participation.........................................................18
2.3.2 Payment of Amounts Drawn Under Letters of Credit......................................19
2.3.3 Special Account.......................................................................19
2.3.4 Authorization for Borrowing...........................................................20
Section 2.4 Swingline Loan Procedures.............................................................20
2.4.1 Borrowing Procedures..................................................................20
2.4.2 Refinancing of Swingline Loans........................................................21
2.4.3 Repayment of Participations...........................................................22
Section 2.5 Term Loan Procedures..................................................................23
2.5.1. Initial Term Loans....................................................................23
2.5.2. Additional Term Loan Procedure........................................................23
Section 2.6 Use of Proceeds.......................................................................24
ARTICLE III. EVIDENCING OF LOANS.........................................................................24
Section 3.1 Notes.................................................................................24
Section 3.2 Payment of Initial and Additional Term Loan Notes.....................................24
Section 3.3 Recordkeeping.........................................................................24
ARTICLE IV. INTEREST.....................................................................................25
Section 4.1 Interest Rates........................................................................25
Section 4.2 Default Interest Rate.................................................................25
Section 4.3 Interest and Principal Payments.......................................................25
4.3.1 Interest..............................................................................25
4.3.2 Principal........................................................................... 26
4.3.3 Swingline Loans.......................................................................26
Section 4.4 Making of Payments....................................................................26
Section 4.5 Payment on Nonbusiness Days...........................................................26
Section 4.6 Computation of Interest and Fees......................................................27
Section 4.7 Generally.............................................................................27
ARTICLE V. FEES, REDUCTIONS AND PREPAYMENTS.............................................................27
Section 5.1 Commitment Fee........................................................................27
Section 5.2 Letter of Credit Fees.................................................................28
Section 5.3 Termination or Reduction of the Revolving Credit Commitments..........................28
Section 5.4 Voluntary Prepayments.................................................................28
Section 5.5 Fees on Advances and Indemnity........................................................29
Section 5.6 Capital Adequacy......................................................................30
Section 5.7 Failure of Any Lender to Make Advances................................................31
Section 5.8 Annual Agent's Fees...................................................................31
ARTICLE VI. CONDITIONS PRECEDENT.........................................................................32
Section 6.1 Initial Conditions Precedent..........................................................32
Section 6.2 Conditions Precedent to All Advances..................................................33
ARTICLE VII. REPRESENTATIONS AND WARRANTIES...............................................................34
Section 7.1 Corporate Existence and Power.........................................................34
Section 7.2 Authorization of Borrowing; No Conflict as to Law or Agreements.......................34
Section 7.3 Legal Agreements......................................................................35
Section 7.4 Subsidiaries..........................................................................35
Section 7.5 Financial Condition...................................................................35
Section 7.6 Adverse Change........................................................................35
Section 7.7 Litigation............................................................................35
Section 7.8 Regulation U..........................................................................35
Section 7.9 Taxes.................................................................................36
Section 7.10 Titles................................................................................36
Section 7.11 ERISA.................................................................................36
Section 7.12 Regulatory Matters....................................................................36
ARTICLE VIII. AFFIRMATIVE COVENANTS.......................................................................36
Section 8.1 Reporting Requirements................................................................37
Section 8.2 Books and Records; Inspection and Examination.........................................38
Section 8.3 Compliance with Laws..................................................................38
Section 8.4 Payment of Taxes and Other Claims.....................................................39
Section 8.5 Operations............................................................................39
Section 8.6 Insurance.............................................................................39
Section 8.7 Preservation of Corporate Existence...................................................39
Section 8.8 Additional Collateral.................................................................39
Section 8.9 Notice of Permitted Acquisition.......................................................40
ARTICLE IX. NEGATIVE COVENANTS...........................................................................40
Section 9.1 Liens.................................................................................40
Section 9.2 Indebtedness..........................................................................40
Section 9.3 Guaranties............................................................................41
Section 9.4 Shareholder Redemptions...............................................................41
Section 9.5 Acquisitions..........................................................................41
Section 9.6 Subordinated Debt.....................................................................41
Section 9.7 Restrictions on Nature of Business....................................................41
Section 9.8 Negative Pledges; Subsidiary Restrictions.............................................42
Section 9.9 Issuance of Additional Stock..........................................................42
Section 9.10 Regulatory Matters....................................................................42
Section 9.11 Dividends.............................................................................42
ARTICLE X. FINANCIAL COVENANTS..........................................................................42
Section 10.1 Total Risk Based Capital Ratio........................................................42
Section 10.2 Tier I Risk Based Capital Ratio.......................................................43
Section 10.3 Leverage Ratio........................................................................43
Section 10.4 Minimum Return on Assets..............................................................43
Section 10.5 Maximum Non-Performing Assets.........................................................43
Section 10.6 Allowance for Loan and Lease Losses...................................................43
ARTICLE XI. EVENTS OF DEFAULT, RIGHTS AND REMEDIES.......................................................43
Section 11.1 Events of Default.....................................................................43
Section 11.2 Rights and Remedies...................................................................46
Section 11.3 Offset................................................................................47
ARTICLE XII. THE AGENT...................................................................................47
Section 12.1 Authorization.........................................................................47
Section 12.2 Distribution of Payments and Proceeds.................................................47
Section 12.3 Expenses..............................................................................48
Section 12.4 Payments Received Directly by Lenders.................................................48
Section 12.5 Indemnification.......................................................................49
Section 12.6 Limitations on Agent's Power..........................................................49
Section 12.7 Exculpation...........................................................................49
Section 12.8 Agent and Affiliates..................................................................49
Section 12.9 Credit Investigation..................................................................50
Section 12.10 Resignation...........................................................................50
Section 12.11 Assignments...........................................................................50
Section 12.12 Participations........................................................................51
Section 12.13 Disclosure of Information.............................................................52
ARTICLE XIII. MISCELLANEOUS..............................................................................52
Section 13.1 No Waiver; Cumulative Remedies........................................................52
Section 13.2 Amendments, Etc.......................................................................53
Section 13.3 Notice................................................................................53
Section 13.4 Costs and Expenses....................................................................53
Section 13.5 Indemnification by Borrower...........................................................53
Section 13.6 Execution in Counterparts.............................................................54
Section 13.7 Binding Effect, Assignment............................................................54
Section 13.8 Governing Law.........................................................................54
Section 13.9 Consent to Jurisdiction/Jury Waiver...................................................54
Section 13.10 Severability of Provisions............................................................55
Section 13.11 Prior Agreements......................................................................55
Section 13.12 Headings..............................................................................55
Section 13.13 No Oral Agreements....................................................................55
Exhibit 1.1 A -- Additional Term Loan Note
Exhibit 1.1 B -- Borrower Pledge Agreement
Exhibit 1.1 C -- Compliance Certificate
Exhibit 1.1 D -- Initial Term Loan Note
Exhibit 1.1 E1 -- Application for Standby Letter of Credit
Exhibit 1.1 E2 -- Standby Letter of Credit Agreement
Exhibit 1.1 F -- Revolving Loan Commitment Amounts and Percentage
Exhibit 1.1 G -- Revolving Note
Exhibit 1.1 H -- San Francisco Company Guaranty
Exhibit 1.1 I -- San Francisco Company Security Agreement
Exhibit 1.1 J -- Swingline Loan Note
Exhibit 2.1.2 A -- Form of Request For Increase in Total Revolving Loan Commitment Amount
Exhibit 2.1.2 B -- Form of Request for Consent to Increase
Exhibit 2.1.2 C -- Form of Request for Additional Lender
Exhibit 2.2.1 -- Notice of Borrowing
Exhibit 2.2.2 -- Form of Notice of Conversion/Continuation
Exhibit 2.2.3 -- Permissible Securities
Exhibit 2.4.1 -- Notice of Swingline Borrowing
Exhibit 2.5.2 -- Form of Term Loan Notice
Exhibit 8.9 -- Notice of Permitted Acquisition
Schedule 7.4 -- Subsidiaries
Schedule 7.7 -- Litigation
Schedule 9.2 -- Indebtedness
Schedule 9.3 -- Guaranties
SECURED CREDIT AGREEMENT
THIS SECURED CREDIT AGREEMENT (this "Agreement") dated as of August
8, 2007, is entered into by and among FIRST BANKS, INC., a Missouri corporation
("Borrower"), the financial institutions that have executed this Agreement as
lenders (each individually a "Lender" and collectively the "Lenders"), and WELLS
FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Agent.
WITNESSETH THAT:
WHEREAS, pursuant to that certain Secured Credit Agreement dated as
of August 14, 2003, as amended by First Amendment to Secured Credit Agreement
dated as of August 12, 2004, Amended and Restated Secured Credit Agreement dated
as of August 11, 2005, and First Amendment to Amended and Restated Credit
Agreement dated as of August 10, 2006 (the foregoing collectively the "Existing
Credit Agreement"), each made by and between Borrower, Agent, and the lenders
who were partner thereto (the "Existing Credit Agreement Lenders");
WHEREAS the Existing Credit Agreement Lenders most recently
severally agreed to make available to Borrower a term loan facility in the
amount of One Hundred Million Dollars ($100,000,000), a revolving credit
facility in the amount of Ten Million Dollars ($10,000,000) and a revolving
letter of credit facility in the amount of One Million Dollars ($1,000,000) upon
the terms and conditions set forth in the Existing Credit Agreement;
WHEREAS, Borrower has requested that Lenders, severally, make
available (i) a revolving credit facility in the amount of One Hundred
Twenty-Five Million Dollars ($125,000,000) including (a) a revolving letter of
credit sub-facility in the amount of Five Million Dollars ($5,000,000), and (b)
a swingline loan sub-facility (from Swingline Lender only) in the amount of Ten
Million Dollars ($10,000,000), with certain term loan conversion privileges as
hereinafter described; and (ii) the right to increase the credit facilities
described at (i) above by an amount up to Twenty-Five Million Dollars
($25,000,000), all as hereinafter described (collectively the "Requested
Facilities");
WHEREAS, Borrower, Lenders and Agent desire to enter into this
Agreement and, by doing so, amend and replace the Existing Credit Agreement, in
its entirety, thereby making available to Borrower the Requested Facilities; and
WHEREAS, the Lenders are willing, severally, to provide to Borrower
the Requested Facilities, all 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
Section 1.1 Defined Terms. As used in this Agreement, the
--------------
following terms have the following meanings (terms defined in the singular to
have the same meaning when used in the plural and vice versa):
"Acquisition" shall mean any of (i) the acquisition by Borrower
or any of its Subsidiaries of stock or other equity interest in any
Person, (ii) the acquisition by any Person of stock or other equity
interest in Borrower or any of its Subsidiaries, (iii) the
consolidation or merger of any Person into Borrower or any of its
Subsidiaries, (iv) the consolidation or merger of Borrower or any of
its Subsidiaries into any Person, and (v) the transfer, outside of the
ordinary course of business, of any assets of any other Person to
Borrower or any of its Subsidiaries, or of Borrower or any of its
Subsidiaries to any other Person.
"Additional Lender" has the meaning ascribed to that term in
Section 12.11(a).
"Additional Term Loan" means a Term Loan made by a Lender
pursuant to Section 2.5.2.
"Additional Term Loan Maturity Date" means, with respect to each
Additional Term Loan, the date that is three (3) years from date of
the related Additional Term Loan Note.
"Additional Term Loan Note" means a promissory note evidencing an
Additional Term Loan made by a Lender and in the form of Exhibit 1.1
A.
"Advance" means any advance by the Lenders to the Borrower
pursuant to Article II.
"Affiliate" means any Person (1) which directly or indirectly
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 five percent (5%) or more of any class of
voting stock of Borrower or any Subsidiary; 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.
"Agent" means Wells Fargo Bank, National Association, acting
either or both (i) in its capacity as Agent pursuant to Article XII
hereof, or any duly appointed successor.
"Agreement" has the meaning assigned to that term in the preamble
of this Agreement.
"Bank Business Day" means a day other than a Saturday, Sunday,
United States national holiday or other day on which banks in
Minnesota are permitted or required by law to close.
"Bank Subsidiary" means any direct or indirect Subsidiary of the
Borrower which is a bank or thrift institution, including, without
limitation the financial institutions listed in Schedule 7.4 hereof
and, beginning one year following the acquisition thereof, any bank or
thrift institution subsequently becoming a direct or indirect
Subsidiary of Borrower.
"Base Rate" means the rate of interest publicly announced from
time to time by the Agent as its "prime" or "base" rate or, if the
Agent ceases to announce a rate so designated, any similar successor
rate designated by the Agent. Each change in the Base Rate shall be
effective on the day the change in the "prime" or "base" rate is
announced within Agent.
"Borrower" has the meaning assigned to such term in the preamble
of this Agreement.
"Borrower Pledge Agreement" means the collateral pledge agreement
in the form of Exhibit 1.1 B pledging to the Agent for the ratable
benefit of the Lenders all of the stock of San Francisco Company.
"Borrowing" means any borrowing under Article II made by the
Borrower from each of the Lenders severally (or, in the case of a
Swingline Loan, from Swingline Lender).
"Capitalized Lease" of a Person means any lease of property by
such Person as lessee which would be capitalized on a balance sheet of
such Person prepared in accordance with GAAP.
"Closing Date" means the date upon which the last of the
conditions precedent specified in Article VI shall be satisfied.
"Collateral" means collectively Borrower's Special Account and
all property which is subject or is to be subject to the Liens granted
by the Borrower Pledge Agreement and the San Francisco Company
Security Agreement.
"Commitments" means the (i) several Revolving Credit Commitments
of Lenders and (ii) Swingline Commitment of Swingline Lender. When
used with reference to a particular Lender, "Commitment" means that
Lender's obligation to make Advances in aggregate amounts equal to its
Term and Revolving Credit Commitment Amounts.
"Compliance Certificate" means a certificate in substantially the
form of Exhibit 1.1 C, or such other form as the Borrower and the
Required Lenders may from time to time agree upon in writing, executed
by the Chief Financial Officer of the Borrower and one (1) additional
officer of the Borrower identified on the signature page to said
Exhibit 1.1 C, stating (i) that any financial statements delivered
therewith have been prepared in accordance with GAAP, subject to
year-end audit adjustments, (ii) whether or not such officer has
knowledge of the occurrence of any Default or Event of Default and
stating in reasonable details the facts with respect to such Default
or Event of Default, (iii) all relevant facts in reasonable detail to
evidence, and the computations as to, whether or not the Borrower is
in compliance with the Financial Covenants, and (iv) all relevant
facts in reasonable detail to evidence, and the computations as to,
whether or not the Borrower is in compliance with the other covenants.
"Control" 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 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.
"Default" means any of the events specified in Section 11.1,
whether or not any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.
"Equity Capital" means, as to Borrower or any Bank Subsidiary,
the aggregate of its perpetual preferred stock (and related surplus),
common stock, surplus (excluding all surplus related to perpetual
preferred stock), undivided profits and capital reserves, plus its net
unrealized holding gains (or minus its net realized holding losses) on
available-for-sale securities.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations and published
interpretations thereof.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) which together with the Borrower would be treated as a
single employer under Section 4001 of ERISA.
"Eurodollar Business Day" means a Bank Business Day on which
dealings in U.S. dollar deposits are carried on in the London interbank
market.
"Eurodollar Rate" means the annual rate equal to the sum of (i)
the rate obtained by dividing (a) the rate (rounded up to the nearest
1/16 of 1%) determined by the Agent as of 11:00 a.m. London, England
time on the second Eurodollar Business Day prior to the date such rate
is to become effective to be the average rate at which U.S. dollar
deposits are offered or available to banks in the London interbank
market for funds to be made available on the first day of any Interest
Period in an amount approximately equal to the amount for which a
Eurodollar Rate quotation has been requested and maturing at the end
of such Interest Period, by (b) a percentage equal to 100% minus the
Federal Reserve System reserve requirement (expressed as a percentage)
applicable to such deposits, and (ii) the applicable Margin. In making
such determination, the Agent shall utilize Telerate page 3750 under
the heading "British Bankers Association LIBOR rates" in the column
designated "USD," as published by Bridge Information Systems, Inc., or
such other comparable source as may be available to the Agent in the
event such Telerate page is no longer published or readily available.
"Eurodollar Rate Funding" means a Borrowing or any portion
thereof, or any other portion of the principal balance of any of the
Notes, that bears interest at a Eurodollar Rate.
"Event of Default" has the meaning ascribed to that term in
Section 11.1, provided that any requirement for the giving of notice,
the lapse of time, or both, or any other applicable condition, has
been satisfied.
"Existing Credit Agreement" has the meaning ascribed to such term
in the recitals to this Agreement.
"Existing Credit Agreement Lenders" has the meaning ascribed to
such term in the recitals to this Agreement.
"Existing Term Loan" means the aggregate of all term loans to
Borrower outstanding, on the Closing Date, under the Existing Credit
Agreement.
"Federal Funds Rate" means at any time an interest rate per annum
equal to the weighted average of the rates for overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published for such day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any
day which is a Bank Business Day, the average, determined by the
Agent, of the quotations for such day for such transactions received
by the Agent from three federal funds brokers of recognized standing
selected by it, it being understood that the Federal Funds Rate for
any day which is not a Bank Business Day shall be the Federal Funds
Rate for the next preceding Bank Business Day.
"Financial Covenants" means any covenant contained in Article X.
"First Bank" means First Bank, a Missouri state bank.
"Floating Rate" means, at any time, an annual rate equal to the
greater of:
(i) the Base Rate; or
(ii) the Federal Funds Rate, plus fifty (50) basis points
(0.50%).
The Floating Rate shall change when and as the Base Rate or Federal
Funds Rate changes.
"Funded Debt" of the Borrower means (without duplication) (i) all
indebtedness of the Borrower for borrowed money; (ii) indebtedness
evidenced by bonds, notes or similar written debt instruments; and
(iii) the face amount of all letters of credit and bankers'
acceptances issued for the account of the Borrower, and, without
duplication, all drafts drawn thereunder; provided, however, that in
-------- -------
no event shall any calculation of Funded Debt include Subordinated
Debt or debt of the type referred to in Section 9.2(b) or Section
9.2(c).
"Funded Debt Ratio" means the ratio of Funded Debt to Net Income
of the Borrower for the most recent period of four (4) fiscal
quarters.
"GAAP" means U.S. generally accepted accounting principles
applied on a basis consistent with the accounting practices applied in
the financial statements described in Section 7.5.
"Initial Term Loan" means the Term Loan to be made by Lenders
pursuant to Section 2.5.1 and in the aggregate amount of the Existing
Term Loan.
"Initial Term Loan Maturity Date" means March 31, 2009.
"Initial Term Loan Note" means a promissory note evidencing an
Initial Term Loan made by a Lender, which is in the form of Exhibit
1.1 D.
"Interest Period" means, with respect to any Eurodollar Rate
Funding (except as provided at Section 4.7 on the Closing Date of this
Agreement), a period of one, two, three or six months beginning on a
Eurodollar Business Day, as elected by the Borrower. Each Interest
Period shall end on the day in the final month of such Interest Period
that immediately precedes the date which numerically corresponds to
the first day of such Interest Period, except that (i) if such final
month has no numerically corresponding day, then the Interest Period
shall end on the last Eurodollar Business Day of such month, and (ii)
if an Interest Period would otherwise end on a day which is not a
Eurodollar Business Day, such Interest Period shall end on the next
following Eurodollar Business Day, unless such next following
Eurodollar Business Day is the first Eurodollar Business Day of a
month, in which case such Interest Period shall end on the next
preceding Eurodollar Business Day.
"L/C Application" means an Application for Standby Letter of
Credit in the form of Exhibit 1.1 E1, and the master Standby Letter of
Credit Agreement in the form of Exhibit 1.1 E2, which master Standby
Letter of Credit Agreement is incorporated into each such Application
for Standby Letter of Credit by reference.
"L/C Margin" means an amount determined under Section 4.7 that is
charged pursuant to Section 5.2.
"Lender" or "Lenders" has the meaning assigned to such term in
the preamble to this Agreement.
"Letter of Credit" has the meaning provided in Section 2.1.3.
"Letter of Credit Commitment" means Agent's commitment to issue
Letters of Credit as provided in Section 2.1.3 and subject to Section
2.3.
"Letter of Credit Commitment Amount" means the lesser of Five
Million Dollars ($5,000,000) and the Total Revolving Loan Commitment
Amount.
"Leverage Ratio" shall be defined and calculated in accordance
with Federal Reserve Board Regulation Y in the case of the Borrower
and in accordance with Section 38 of the Federal Deposit Insurance Act
in the case of a Bank Subsidiary.
"Lien" means any mortgage, deed of trust, lien, pledge, security
interest or other charge or encumbrance, of any kind whatsoever,
including but not limited to the interest of the lessor or titleholder
under any Capitalized Lease, title retention contract or similar
agreement.
"Loan" means any loan or Advance made to Borrower pursuant to
Article II.
"Loan Documents" means this Agreement, the Notes, the Borrower
Pledge Agreement, the San Francisco Company Guarantee and the San
Francisco Company Security Agreement, as each may be renewed,
extended, amended, rearranged, restructured, restated, replaced or
otherwise modified from time to time.
"Margin" means amounts determined pursuant to Section 4.7 that is
added to other amounts to determine a Eurodollar Rate.
"Multiemployer Plan" means a Plan described in Section 4001(a)(3)
of ERISA which covers employees of the Borrower or any of its
Affiliates.
"Net Income" has the meaning assigned to such term by GAAP,
without reference to extraordinary items or adjustments caused solely
by changes in applicable accounting principles.
"Non-Performing Assets" of any Person means the sum of: (i) all
loans and leases classified as past due 90 days or more and still
accruing interest; (ii) all loans and leases classified as
"non-accrual" and no longer accruing interest; (iii) all loans and
leases classified as "restructured loans and leases"; (iv) without
duplication, all property acquired in repossession or foreclosure and
property acquired pursuant to in-substance foreclosure; and (v) if
such Person is a Bank Subsidiary, all other "Non-Performing Assets,"
as reported in the then most recent call report of such Bank
Subsidiary.
"Note" means either a Revolving Note, the Swingline Note, an
Initial Term Loan Note or an Additional Term Loan Note, in each case
including any new Note issued pursuant to Section 12.11(a).
"Notes" means, collectively, the Revolving Notes, the Swingline
Note, the Initial Term Loan Note and the Additional Term Loan Notes,
in each case including any new Note issued pursuant to Section
12.11(a).
"Notice of Swingline Borrowing" shall have the meaning ascribed
thereto in Section 2.4.1.
"Obligation of Reimbursement" has the meaning given in Section
2.3.2(a).
"Obligations" means all debts, liabilities, obligations,
covenants and duties of the Borrower arising under any of the Loan
Documents, whether direct or indirect, absolute or contingent, due or
to become due, and whether now existing or hereafter arising.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Percentage" means, with respect to each Lender, the percentage
so designated next to such Lender's name in Exhibit 1.1 F, as such
percentage may be adjusted from time to time pursuant to Section
12.11.
"Permitted Acquisition" means any Acquisition by Borrower or any
of its Subsidiaries, in each case so long as:
(i) no Default or Event of Default is continuing at the
time of such Acquisition, or would be caused by such
Acquisition;
(ii) all authorizations of governmental agencies, bodies or
authorities which are necessary to approve the
Acquisition have been obtained and are in full force
and effect, or will be obtained contemporaneously with
the earlier to occur of closing of such Acquisition and
the making of any Advance for such purpose, and no
further approval, consent, order or authorization of or
designation, registration, declaration or filing with
any governmental authority is required in connection
therewith;
(iii) in the case of any Acquisition that is a consolidation
or merger, the continuing or surviving corporation
shall be controlled by the Borrower immediately
following the transaction; provided, however, that (A)
-------- -------
a Subsidiary may merge with and into the Borrower or
another Subsidiary, but (B) under no circumstances may
the Borrower merge into or consolidate with any
Subsidiary; and
(iv) any notice required in connection with such Acquisition
pursuant to Section 8.9 shall have been timely given.
"Person" means an individual, partnership, corporation, business
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,
maintained, or to which contributions have been made by the Borrower
or any ERISA Affiliate.
"Primary Equity Capital" of an entity means the aggregate of the
allowance for loan and lease losses of such entity, as reported in the
most recent quarterly report on Form 10-Q or annual report on Form
10-K filed by the Borrower with the SEC plus the Equity Capital of
such entity; provided however that if Borrower shall cease to be
required to file quarterly reports on Form 10-Q and/or annual reports
on Form 10-K, thereafter the Primary Equity Capital shall be as set
forth in Borrower's quarterly financial report, certified by
Borrower's Chief Financial Officer, and annual audit report, certified
by the auditor of such annual audit report.
"Reportable Event" means any of the events set forth in Section
4043 of ERISA.
"Requested Facilities" have the meaning ascribed to such term in
the recitals to this Agreement.
"Required Lenders" means Lenders (including, where relevant,
Additional Lenders) having an aggregate Percentage of 66 2/3% or more
or, if the Commitments shall have been terminated, having 66 2/3% or
more of the aggregate principal amount of all then outstanding
Advances.
"Return on Assets" of a Person means the percentage determined by
dividing the Net Income of such Person for the four calendar quarters
immediately preceding the date of determination by its total average
assets during such period. The total average assets of a Person shall
be as reported in quarterly financial statements for such period.
"Revolving Credit Commitment" means Lenders' Commitments,
severally, to provide revolving loans as provided in Section 2.1.1.
"Revolving Credit Commitment Amount" means, with respect to
each Lender, the Revolving Credit Commitment amount set forth opposite
that Lender' s name on Exhibit 1.1F, as that amount may be adjusted
from time to time pursuant to Section 5.3 or any assignment made
pursuant to Section 12.11.
"Revolving Credit Termination Date" means August 7, 2008.
"Revolving Loans" shall have the meaning provided in Section
2.1.1.
"Revolving Loan Margin" means an amount determined under Section
4.7 that is charged pursuant to Section 4.1.
"Revolving Note" means a Note evidencing a Revolving Loan made by
a Lender, which Note is in the form of Exhibit 1.1 G attached hereto.
"San Francisco Company" means The San Francisco Company, a
Delaware corporation.
"San Francisco Company Guaranty" means the Guaranty, in the form
of Exhibit 1.1 H, whereby San Francisco Company guarantees to the
Lenders payment of the Obligations.
"San Francisco Company Security Agreement" means the San
Francisco Company Security Agreement, in the form of Exhibit 1.1 I,
pledging to the Agent for the ratable benefit of the Lenders all of
the stock of First Bank.
"SEC" means the federal Securities and Exchange Commission.
"Subordinated Debt" means indebtedness of the Borrower or any of
its Subsidiaries which is subordinated in right of payment to all
indebtedness of the Borrower to any Lender, on terms that have been
approved in writing by the Required Lenders and that have been noted
by appropriate legend on all instruments evidencing the Subordinated
Debt.
"Subsidiary" means, as to Borrower, any business entity,
including, but not limited to any corporation, limited liability
company, partnership, limited partnership, limited liability
partnership, business trust, or any similar entity, with total assets
exceeding $1,000,000 of which 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
the Borrower or a Subsidiary of Borrower.
"Swingline Advance" means any advance made by Agent pursuant to
Section 2.4.
"Swingline Borrowing" means any borrowing made by Borrower under
Section 2.4.
"Swingline Commitment" means Agent's commitment to provide
Swingline Advances as provided in Section 2.1.4.
"Swingline Sub-Facility" means the credit facility provided
pursuant to Section 2.1.4.
"Swingline Lender" means Wells Fargo Bank, National Association,
a national banking association, in its capacity as provider of the
Swingline Sub-Facility.
"Swingline Loan Commitment Amount" means, with respect to Agent
only, the lesser of (i) the amount of Ten Million Dollars
($10,000,000), and (ii) the Total Revolving Loan Commitment Amount.
The Swingline Loan Commitment Amount is a part of and not in addition
to the Total Revolving Loan Commitment Amount.
"Swingline Note" means a note evidencing the Swingline Loan made
by Swingline Lender in the form of Exhibit 1.1 J.
"Term Loan" shall have the meaning provided in Section 2.1.5.
"Term Loan Margin" means an amount determined under Section 4.7
that is charged pursuant to Section 4.1.
"Term Note" means a note evidencing a Term Loan made by a Lender.
"Tier I Risk Based Capital Ratio" shall be defined and calculated
in accordance with Federal Reserve Board Regulation Y in the case of
the Borrower and in accordance with Section 38 of the Federal Deposit
Insurance Act in the case of a Bank Subsidiary.
"Total Revolving Loan Commitment Amount" means the sum of One
Hundred Twenty-Five Million Dollars ($125,000,000) as that amount may
be increased from time to time pursuant to Section 2.1.2, and reduced
by all Swingline Loans, Revolving Loans, Term Loans, Letters of
Credit, and Obligation of Reimbursement at any time outstanding, as
well as Section 5.3.
"Total Risk Based Capital Ratio" shall be defined and calculated
in accordance with Federal Reserve Board Regulation Y in the case of
the Borrower and in accordance with Section 38 of the Federal Deposit
Insurance Act in the case of a Bank Subsidiary.
Section 1.2 Other Interpretive Provisions.
-----------------------------
(a) All accounting terms not specifically defined herein
shall be construed in accordance with GAAP as applied in the preparation of the
financial statements and reports referred to in Section 8.1, and all financial
data submitted pursuant to this Agreement shall be prepared in accordance with
such principles.
(b) the amount of all Loans from time to time outstanding
shall include all accrued and unpaid interest, fees and charges.
(c) Section references are to this Agreement unless otherwise
specified.
(d) Schedules and Exhibits referred to herein are attached to
and made a part hereof unless otherwise specified.
(e) The term "including" is not limiting and means "including
without limitation."
(f) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and including"; the
words "to" and "until" each mean "to but excluding", and the word "through"
means "to and including."
(g) Unless otherwise expressly provided herein, (i)
references to agreements (including this Agreement and the other Loan Documents)
and other contractual instruments shall be deemed to include all subsequent
amendments, restatements, supplements and other modifications thereto, but only
to the extent such amendments, restatements, supplements and other modifications
are not prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation shall be construed as including all statutory and
regulatory provisions amending, replacing, supplementing or interpreting such
statute or regulation.
(h) This Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are cumulative and
each shall be performed in accordance with its terms.
(i) This Agreement and the other Loan Documents are the
result of negotiations among and have been reviewed by counsel to the Borrower,
Lenders and Agent and the other parties thereto and are the products of all
parties. Accordingly, they shall not be construed against Borrower, Agent or
Lenders merely because of Borrower's, Agent's or any Lender's involvement in
their preparation.
ARTICLE II.
COMMITMENTS OF THE LENDERS; BORROWING, CONVERSION
AND LETTER OF CREDIT PROCEDURES
Section 2.1 Commitments. On and subject to the terms and
-----------
conditions of this Agreement, each of the Lenders, severally and for itself
alone, agrees to make loans to, and to issue or participate in letters of credit
for the account of, the Borrower as follows:
2.1.1. Revolving Loan Commitment. Subject to Section 2.2, each
--------------------------
Lender shall make a loan to Borrower, on a revolving basis
(collectively, the "Revolving Loans"), from time to time through the
Revolving Credit Termination Date, to the extent of such Lender's
Percentage of the aggregate amount requested by Borrower from all
Lenders in accordance with this Agreement; provided however that the
aggregate of all Revolving Loans outstanding shall at no time exceed
the Total Revolving Loan Commitment Amount.
2.1.2 Increase of the Revolving Loan Commitments.
------------------------------------------
(a) The Borrower may, at its election at any time or
from time to time after the date hereof, and prior to thirty (30)
days before the Revolving Credit Termination Date, increase the
Total Revolving Loan Commitment Amount by the aggregate amount of
up to Twenty-Five Million Dollars ($25,000,000); provided and
subject to the express conditions precedent that: (i) each
proposed increase in the Revolving Credit Commitment Amount
of any Lender shall be subject to the written consent of such
Lender (it being expressly agreed and understood by the Borrower
that no Lender has agreed or committed or otherwise undertaken
to agree or commit to increase the Revolving Credit Commitment
Amount of such Lender above such Lender's Revolving Credit
Commitment Amount as in effect on August 8, 2007, and set forth
on Exhibit 1.1 F), (ii) each such increase of the Total Revolving
Loan Commitment Amount shall be in an amount that is an integral
multiple of Five Million Dollars ($5,000,000) and not less than
Ten Million Dollars ($10,000,000), (iii) the Borrower shall not
request to increase the Total Revolving Loan Commitment Amount
if, after giving effect to any permanent reduction of the Total
Revolving Loan Commitment Amount in accordance with Section 5.3,
the sum of the Total Revolving Loan Commitment Amount would
exceed the amount of One Hundred Fifty Million Dollars
($150,000,000), (iv) the Borrower shall not request to increase
the Total Revolving Loan Commitment Amount more than twice, (v)
no Default or Event of Default shall have occurred and be
continuing at the time of such increase or as a result of such
increase, (vi) each increase of the Total Revolving Loan
Commitment Amount may be made ratably among the Lenders
participating in such increase in accordance with their
respective Percentages, or may be made in such other
increments satisfactory to each such Lender, in each case subject
to the written consent of each such Lender (provided, however,
-------- -------
that the Lenders' respective Percentages in connection with any
outstanding Term Loans as of the effective date of such increase
shall remain the same), and (vii) notwithstanding Article XII
hereof, additional Persons may become Lenders under this
Agreement to accommodate such increase, subject to the consent of
the Borrower and the Agent, such consent not to be unreasonably
withheld, conditioned or delayed.
(b) The Borrower shall notify the Agent in writing of
any request to increase the Total Revolving Loan Commitment
Amount under this Section 2.1.2 at least thirty (30) days prior
to the desired effective date of such increase, specifying such
election and the effective date thereof, in the form of Exhibit
2.1.2 A. Such notice shall be accompanied by the resolutions of
the board of directors of the Borrower and The San Francisco
Company approving such increase, as certified by the Secretary or
an Assistant Secretary of the Borrower and The San Francisco
Company. Within five (5) Bank Business Days after receipt of any
such notice, the Agent shall advise the Lenders of the contents
thereof. Each Lender shall have the option, in its sole
discretion, to subscribe for its Percentage of such requested
increase. The Lenders shall respond in writing to the Borrower's
request through the Agent within ten (10) Bank Business Days from
notification by the Agent of the Borrower's request for increase.
Any Lender not responding within ten (10) Bank Business Days
shall be deemed to have declined to participate in the Borrower's
request for increase to the Total Revolving Loan Commitment
Amount. At the option of the Borrower, any part of the increase
in the Total Revolving Loan Commitment Amount not so subscribed
may be assumed by one or more existing Lenders or assumed by
another financial institution or institutions designated by the
Borrower and acceptable to the Agent, which consent shall not be
unreasonably withheld, conditioned or delayed, upon submission of
the notice to Agent in the form of Exhibit 2.1.2 B, in the case
of an existing Lender, or Exhibit 2.1.2 C, in the case of a new
lender. Each notice delivered by the Borrower pursuant to this
Section 2.1.2 shall be irrevocable.
(c) If the Total Revolving Loan Commitment Amount shall
be increased as provided at this Section 2.1.2, before there
shall be made any Advance that would cause the Revolving Loans by
any Lender to exceed such Lender's Revolving Loan Commitment
Amount(as the same existed immediately before such increase), the
Borrower shall execute and deliver to such Lender a Revolving
Note in the amount of such increase.
2.1.3. Letter of Credit Sub-Facility Commitment. Subject to
-------------------------------------------
Section 2.3, Agent shall, from time to time, issue one or more letters
of credit (each a "Letter of Credit"), for the account of Borrower,
through the Revolving Credit Termination Date, in an aggregate amount
at any time outstanding not to exceed the Letter of Credit Commitment
Amount. Letters of Credit provided pursuant to this Agreement,
together with all Obligations of Reimbursement, shall, while
outstanding, reduce the amount otherwise available pursuant to the
Letter of Credit Commitment. Each Letter of Credit shall be at the
request and for the account of Borrower pursuant to a separate L/C
Application entered into by Borrower, as applicant. The terms and
conditions set forth in each L/C Application shall supplement the
terms and conditions hereof, but, in the event of any inconsistency
between the terms and conditions of any such L/C Application, and the
terms of the Agreement, the terms hereof shall control. Each Lender
shall be deemed to purchase and hold a participation in each Letter of
Credit to the extent of such Lender's Percentage thereof.
2.1.4. Swingline Sub-Facility Commitment. Subject to Section
----------------------------------
2.4, Swingline Lender shall make loans (each a "Swingline Loan" and
collectively the "Swingline Loans") to Borrower from time to time
during the period from the Closing Date through the Revolving Credit
Termination Date notwithstanding the fact that any Swingline Loans,
when aggregated with Swingline Lender's Percentage of all outstanding
Revolving Loans (in its capacity as a Lender) may exceed the amount of
such Lender's Revolving Loan Commitment; provided however that, after
giving effect to any Swingline Loan, the aggregate of all Swingline
Loans shall at no time exceed the Swingline Loan Commitment Amount;
and provided further that no Swingline Loan shall be made to refinance
an outstanding Swingline Loan. Within the limits herein set forth,
Borrower may repay and reborrow Swingline Loans. Each Lender hereby
irrevocably and unconditionally agrees to, purchase from Swingline
Lender a participation in each Swingline Loan in an amount equal to
such Lender's Percentage of such Swingline Loan.
2.1.5. Term Loan Conversion and Sub-Facility Commitment. Subject
------------------------------------------------
to Section 2.5, (i) on the Closing Date each Lender shall make the
Initial Term Loan to Borrower to the extent of such Lender's
Percentage thereof and (ii) from time to time through the Revolving
Credit Termination Date, at the election to Borrower, Borrower may
request that all or any portion of any then outstanding Revolving
Loans be converted to an Additional Term Loan and/or a new Advance
made as an Additional Term Loan, which Additional Term Loan, if and to
the extent a Revolving Loan, shall be deemed made to Borrower by each
Lender in such Lender's Percentage that was applicable to the
converted Revolving Loan and, if and to the extent it is a new
Advance, shall be made by each Lender's then Percentage. Each Lender's
Initial Term Loan and all such Lender's Additional Term Loans shall
collectively comprise such Lender's "Term Loan" to Borrower.
Notwithstanding the foregoing, in no event shall the aggregate of all
Revolving Loans, Term Loans, Swingline Loans, Letter of Credits, and
Obligation of Reimbursement exceed the aggregate Revolving Credit
Commitment Amounts.
Section 2.2 Revolving Loan Procedures.
-------------------------
2.2.1 Borrowing Procedures.
--------------------
(a) Each Revolving Loan shall occur following written
request via such form as is attached as Exhibit 2.2.1 or
telephonic request to the Agent from the Borrower, with any such
telephonic request to be confirmed by fax in such form as is
attached as Exhibit 2.2.1. Each such notice or request shall
specify: (i) the date of the requested Revolving Loan; (ii) the
amount thereof; and (iii) if any portion of such Revolving Loan
will bear interest at a Eurodollar Rate, the Interest Period
selected by the Borrower with respect thereto. Such notice or
request must be received by the Agent not later than 10:00 a.m.
(California time) on the Bank Business Day prior to the day on
which such Revolving Loan is to occur or, if all or any portion
of the Revolving Loan will bear interest at a Eurodollar Rate,
not later than three Eurodollar Business Days prior to the date
on which such Revolving Loan is to occur. Each Borrowing shall be
in the amount of (i) not less than $1,000,000 or (ii) in an
integral multiple of $100,000 greater than $1,000,000. The
Borrower shall be obligated to repay all Revolving Loans made to
it notwithstanding the fact that the Person requesting the same
was not in fact authorized so to do. Any request for a Revolving
Loan shall be deemed to be a representation that the statements
set forth in Article VII are correct except to the extent that
the same relate specifically to an earlier date.
(b) Upon receiving a request for a Borrowing under this
Section 2.2.1, and in any event not later than 11:00 a.m.
(California time) on the day that the request is received, the
Agent will notify the Lenders of the amount of the requested
Borrowing, the amount of each Lender's Revolving Loan with
respect thereto, and, if applicable, the fact that the Borrower
has elected a Eurodollar Rate and the Interest Period selected by
the Borrower. Upon fulfillment of the applicable conditions set
forth in Article VI, each Lender shall remit its Percentage of
the requested Revolving Loan to the Agent in immediately
available funds. Each Lender shall make each Advance to be made
by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 11:00 a.m. (California time) to
the account of the Agent most recently designated by it for such
purpose by notice to the Lenders. The Agent will make such
Advances available to the Borrower by wire transferring the same
to an account designated by the Borrower at First Bank or in such
other manner as the Agent and the Borrower may from time to time
agree in writing, prior to 12:00 noon (California time) on the
day of the requested Revolving Loan. The Agent shall have no
obligation to disburse the requested Borrowing if any condition
set forth in Article VI has not been satisfied on the day of the
requested Revolving Loan. Unless the Agent shall have received
notice from a Lender prior to the proposed date of any Borrowing
that such Lender will not make available to the Agent such
Lender's Percentage of such Revolving Loan, the Agent may assume
that such Lender has made such share available on such date in
accordance with this Section 2.2.1 and may, in reliance upon such
assumption, make available to the Borrower a corresponding
amount. In such event, if a Lender has not in fact made its
Percentage of the applicable Revolving Loan available to the
Agent, then the applicable Lender agrees to pay to the Agent
forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is
made available to the Borrower to but excluding the date of
payment to the Agent, at the greater of the Federal Funds Rate
and a rate determined by the Agent in accordance with banking
industry rules on interbank compensation. If such Lender pays
such amount to the Agent, then such amount shall constitute such
Lender's Percentage in such Revolving Loan.
(c) In the event that any one or more Lenders'
obligations to make Advances at the Eurodollar Rate are suspended
pursuant to Section 2.2.2(c) following a request for a Borrowing
that specifies that a Eurodollar Rate is to apply, such Lenders
shall nevertheless be obliged to fund their respective Advances,
and such Advances shall bear interest at the Floating Rate until
they are repaid or until such Lenders may again make, maintain
or fund Advances at the Eurodollar Rate and the Borrower
requests pursuant to Section 2.2.2(a) that a Eurodollar Rate be
applicable to such Advances.
2.2.2 Conversion of Principal to Eurodollar Rates.
-------------------------------------------
(a) At the election of the Borrower, which election may
be exercised from time to time, the Borrower may request in
writing via such form as attached as is Exhibit 2.2.2 or by
telephonic request to be confirmed by fax in such form as is
attached as Exhibit 2.2.2 that a Eurodollar Rate be applicable
for the portion of the outstanding principal balance of the Term
or Revolving Notes (including any Revolving Loan requested or to
be requested) and for the Interest Period indicated by the
Borrower in its request. The portion of the outstanding balance
of the Notes for which a Eurodollar Rate is requested must, on
the first day of the applicable Interest Period, either (A) bear
interest at the applicable Floating Rate, or (B) bear interest
at an applicable Eurodollar Rate with respect to which the
Interest Period expires on such first day. A request for a
Eurodollar Rate must be received by the Agent before 10:00 a.m.
(California time) on the day three (3) Eurodollar Business Days
before the first day of the proposed Interest Period. Upon
receiving a request for a Eurodollar Rate, and in any event not
later than the close of business on the day that the request is
received, the Agent will notify the Lenders of the Note (Term or
Revolving) subject to such Eurodollar Rate and the amount and
Interest Period applicable thereto. Not later than 2:00 p.m.
(California time) on the second (2nd) Eurodollar Business Day
prior to the date on which such Eurodollar Rate is to become
effective, the Agent will notify the Lenders and the Borrower of
the interest rate to be applicable thereto. Following a request
for a Eurodollar Rate under this Section 2.2.2, or pursuant to
Section 2.2.1, the Eurodollar Rate as determined hereunder shall
be the interest rate applicable for the proposed Interest Period
to the portion of the outstanding principal balance of the Notes
to which the quotation related, subject to fluctuations in the
applicable Margin (and the remaining part of the principal
balance of those Notes (and any other Notes), if any, shall
continue to bear interest at the rate or rates previously
applicable to such amounts). At the termination of such Interest
Period, the interest rate applicable to that portion of the
principal balance of those Notes to which the Eurodollar Rate
quotation was applicable shall revert to the Floating Rate unless
a new Eurodollar Rate quotation with respect thereto is requested
by the Borrower in accordance with this Section 2.2.2.
(b) The Eurodollar Rate applicable to each Eurodollar
Rate Funding shall be determined by the Agent between the opening
of business and 9:00 a.m. (California time) on the second (2nd)
Eurodollar Business Day prior to the beginning of the applicable
Interest Period. Promptly following such determination, the Agent
shall give notice thereof (which may be by telephone if promptly
confirmed by fax) to the Borrower and each Lender. Each such
determination of the applicable Eurodollar Rate shall be
conclusive and binding upon the parties hereto, in the absence of
demonstrable error. The Agent, upon written request of the
Borrower or any Lender, shall deliver to the Borrower or such
requesting Lender a statement showing the computations used by
the Agent in determining the applicable Eurodollar Rate
hereunder.
(c) In no event shall more than six (6) Eurodollar Rate
Fundings be outstanding at any one time. In no event may the
Borrower request a Eurodollar Rate Funding if, after giving
effect to such Eurodollar Rate Funding, the Borrower would be
required to prepay the Eurodollar Rate Funding in order to pay
the principal amount of the related Revolving or Term Loans on
the (as applicable) Revolving Credit or Term Loan Termination
Date. In no event may the Borrower rescind any request for a
Eurodollar Rate Funding once made. Notwithstanding anything to
the contrary in this Agreement, the Agent and the Lenders shall
have no obligation to honor any request for a Eurodollar Rate
Funding if a Default or Event of Default has occurred and is
continuing when such request is made or on the first (1st) day of
the Interest Period applicable thereto. If on or prior to the
first day of any Interest Period the Agent reasonably determines
(which determination shall be conclusive) that, by reason of
circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar
Rate for such Interest Period, or the Required Lenders both
reasonably determine (which determination shall be conclusive)
and notify the Agent that the Eurodollar Rate will not adequately
and fairly reflect the cost to the Lenders of funding the
requested Eurodollar Rate Funding for such Interest Period, then
the Agent shall give the Borrower prompt notice thereof
specifying the amounts or periods and, so long as such condition
remains in effect, the Lenders shall be under no obligation to
fund any Eurodollar Rate Fundings and the Borrower shall, on the
last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Rate Fundings, either prepay such
Eurodollar Rate Fundings or convert such Eurodollar Rate Fundings
into Floating Rate Borrowings in accordance with the terms of
this Agreement. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender
to make, maintain, or fund Advances at the Eurodollar Rate
hereunder, then such Lender shall promptly notify the Borrower
thereof and such Lender's obligation to make, maintain or fund
Advances at the Eurodollar Rate shall be suspended until such
time as such Lender may again make, maintain, and fund Advances
at the Eurodollar Rate. If the obligation of any Lender to make,
maintain or fund Advances at the Eurodollar Rate shall be
suspended pursuant to this Section 2.2.2(c), such Lender's
affected Advances shall be automatically converted into Floating
Rate Advances on the last day(s) of the then current Interest
Period(s) for the affected Advances.
(d) Absent error, the records of the Agent shall be
conclusive evidence as to the amount of each Eurodollar Rate
Funding and the interest rate and Interest Period applicable
thereto.
Section 2.3 Letter of Credit Procedures.
---------------------------
2.3.1 Issuance/Lender Participation.
-----------------------------
(a) Each Letter of Credit, if any, shall be issued
pursuant to a separate L/C Application entered into by the
Borrower, as applicant, completed in a manner satisfactory to the
Agent, and delivered to the Agent at least five (5) Bank Business
Days prior to the date such Letter of Credit is to be issued. The
terms and conditions set forth in each such L/C Application shall
supplement the terms and conditions hereof, but in the event of
inconsistency between the terms of any such L/C Application and
the terms hereof, the terms hereof shall control.
(b) Each Lender shall be deemed to hold a participation
interest in each Letter of Credit equal to that Lender's
Percentage of the face amount of that Letter of Credit. If the
Agent makes any payment pursuant to the terms of any Letter of
Credit and is not promptly reimbursed, the Agent may request that
each Lender pay such Lender's Percentage of the unreimbursed
amount. Upon receipt of any such request prior to 11:00 a.m.
(California time) on a Bank Business Day, the recipient shall be
unconditionally and irrevocably obligated to pay its Percentage
of the unreimbursed amount to the Agent in immediately available
funds prior to 1:00 p.m. (California time) on such date. Notices
received after 11:00 a.m. (California time) shall be deemed to
have been received on the following Bank Business Day. If full
payment is not made by a Lender when due hereunder, then the
applicable Lender agrees to pay to the Agent forthwith on demand
such corresponding amount with interest thereon, for each day
from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Agent, at
the greater of the Federal Funds Rate and a rate determined by
the Agent in accordance with banking industry rules on interbank
compensation. If such Lender pays such amount to the Agent, then
such amount shall constitute such Lender's Percentage in such
Letter of Credit. After making any payment to the Agent under
this subsection in connection with a particular Letter of Credit,
a Lender shall be entitled to participate to the extent of its
Percentage in the related reimbursements and any interest thereon
received by the Agent from the Borrower or otherwise. Upon
receiving any such reimbursement, the Agent will distribute to
each Lender its Percentage of such reimbursement and any interest
thereon.
(c) No Letter of Credit shall be issued with an expiry
date later than ninety (90) days after the Revolving Credit
Termination Date.
(d) Any request for the issuance of a Letter of Credit
under this Section 2.3 shall be deemed to be a representation
that the statements set forth in Article VII hereof are correct
except to the extent that the same relate specifically to an
earlier date.
2.3.2 Payment of Amounts Drawn Under Letters of Credit. The
----------------------------------------------------
Borrower shall pay the Agent any and all amounts required to be paid
under the applicable L/C Application, when and as required to be paid
thereby, including all amounts designated below, when and as
designated:
(a) The Borrower shall pay the Agent on the day a draft
is honored under any Letter of Credit a sum equal to all amounts
drawn under such Letter of Credit plus any and all reasonable
charges and expenses that the Agent may pay or incur relative to
such draw, plus interest on all such amounts, charges and
expenses as set forth below (all such amounts are hereinafter
referred to, collectively, as the "Obligation of Reimbursement").
(b) The Borrower shall pay the Agent on demand interest
on all amounts, charges and expenses payable by the Borrower to
the Agent under this Section 2.3.2, accrued from the date any
such draft is paid, or any such charge or expense is paid or
incurred, by the Agent until payment in full by the Borrower at
the Floating Rate.
(c) Upon the occurrence of any Default or Event of
Default, and so long as any such Default or Event of Default
continues without written waiver thereof by the Required Lenders,
the rate of interest on all amounts, charges and expenses payable
by the Borrower to the Agent under this Section 2.3.2 shall be
the Floating Rate plus four percent (4.00%).
2.3.3 Special Account.
---------------
(a) If the Commitments are terminated in whole pursuant
to Section 5.3, or if an Event of Default shall occur and be
continuing, and in any event on the Revolving Credit Termination
Date, the Borrower shall pay the Agent in immediately available
funds, for deposit in a deposit account established for the sole
purpose of holding such funds, an amount equal to the maximum
aggregate amount available to be drawn under all Letters of
Credit then outstanding, assuming compliance with all conditions
for drawing thereunder (the "Maximum Reimbursement Obligation").
Alternatively, the Borrower may transfer to the Agent cash and
Permissible Securities for deposit in a securities account
established for the sole purpose of holding such funds, of an
aggregate Collateral Value equal to the Maximum Reimbursement
Obligation; provided, however, that if the Borrower wishes to
-------- -------
transfer Permissible Securities in lieu of cash, it must
simultaneously deliver to the Agent such account and control
agreements and such other documents as the Agent may reasonably
determine are necessary in order to establish and perfect the
security interest referred to in subsection (c), below. Any such
deposit account or securities account shall be referred to herein
as the "Special Account."
(b) "Permissible Securities" means securities described
in Exhibit 2.2.3, and the "Collateral Value" of a Permissible
Security is its market value, as reasonably determined by the
Agent, multiplied by the percentage determined pursuant to
Exhibit 2.2.3. The "Collateral Value" of cash is its face value.
(c) The Borrower hereby grants to the Agent, for the
benefit of the Lenders, a security interest in the Special
Account and all funds and Permissible Securities held therein
from time to time and all proceeds thereof, as security for the
payment of all Obligations. Any interest earned on funds and
Permissible Securities deposited in the Special Account shall be
credited to the Special Account. Amounts on deposit in the
Special Account may be applied by the Agent at any time or from
time to time to the Borrower's Obligation of Reimbursement or any
other Obligations, in the Agent's sole discretion, and shall not
be subject to withdrawal by the Borrower so long as the Agent
maintains a security interest therein. The Agent agrees to
transfer any balance of cash or Permissible Securities in the
Special Account to the Borrower at such time as the Obligations
have been paid in full.
2.3.4 Authorization for Borrowing. In the event that the
---------------------------
Borrower shall be obligated to make any payment pursuant to Section
2.3.2 or any payment or transfer of securities pursuant to Section
2.3.3, and shall not have made other arrangements for payment or
transfer of securities as of the due date, then the Agent will
initiate an Advance in an amount not to exceed the amount available to
be borrowed pursuant to Section 2.1.1 without request from the
Borrower and use the proceeds to satisfy such payment Obligation. The
procedure for such Borrowing, and the Agent's and Lenders' rights and
Obligations with respect thereto, shall be in all respects identical
to those applicable to an Advance initiated by the Borrower pursuant
to Section 2.1.1, and such Advance shall not itself cause a Default or
Event of Default. The Borrowing in respect of such Advance shall bear
interest at the Floating Rate.
Section 2.4 Swingline Loan Procedures.
-------------------------
2.4.1 Borrowing Procedures. Each Swingline Borrowing shall
--------------------
be made upon the Borrowers' written request to the Swingline
Lender and the Agent via such form as is attached as Exhibit
2.4.1 or telephonic request to Swingline Lender and Agent with
any telephonic request to be confirmed by fax in such form of
Notice of Swingline Borrowing as is attached as Exhibit 2.4.1.
Each such request must be received by the Swingline Lender and
the Agent not later than 11:00 a.m. (California time), on the
same Bank Business Day as the requested borrowing date and shall
specify (i) the amount to be borrowed, which amount shall be a
minimum amount of $100,000 or an integral multiple of $25,000 in
excess thereof, and (ii) the requested borrowing date, which
shall be a Bank Business Day. Promptly after receipt by the
Swingline Lender of any telephonic Notice of Swingline Borrowing,
the Swingline Lender will confirm with the Agent (by telephone or
in writing) that the Agent has also received such Notice of
Swingline Borrowing and, if not, the Swingline Lender will notify
the Agent (by telephone or in writing) of the contents thereof.
Unless the Swingline Lender has received notice (by telephone or
in writing) from the Agent prior to 12:00 p.m. (California time),
on the date of the proposed Swingline Borrowing (A) directing the
Swingline Lender not to make such Swingline Loan as a result of
the limitations set forth in Section 2.1.4 or (B) that one or
more of the applicable conditions specified in Section 6.2 is not
then satisfied, then, subject to the terms and conditions hereof,
the Swingline Lender will, not later than 1:00 p.m. (California
time), on the borrowing date specified in such Notice of
Swingline Borrowing, make the amount of its Swingline Loan
available to the Borrowers by wire transferring the same to the
account designated by Borrower at First Bank or in such other
manner as the Swingline Lender and Borrower may agree upon in
writing prior to 1:00 p.m. (California time) on the day of the
requested Swingline Loan.
2.4.2 Refinancing of Swingline Loans.
------------------------------
(a) The Swingline Lender at any time in its sole and
absolute discretion may request, on behalf of the Borrower (which
hereby irrevocably requests the Swingline Lender to act on its
behalf for purposes of this Section 2.4.2), under this Section
2.4.2, that each Lender make a Revolving Loan in an amount equal
to such Lender's Percentage of the amount of Swingline loans then
outstanding. Such request shall be made in accordance with the
requirements of Section 2.2.1, without regard to the minimum and
multiples specified therein for the principal amount of Revolving
Loans, but subject to the unutilized portion of the Total
Revolving Loan Commitment Amount and the conditions set forth in
Section 6.2. Each Lender shall make an amount equal to its
Percentage of the amount specified in such notice available to
the Agent in immediately available funds for the account of the
Swingline Lender at the Agent's Office not later than 12:00 p.m.
(California time), on the day specified in such notice,
whereupon, subject to Section 2.4.2(b), each Lender that so makes
funds available shall be deemed to have made a Revolving Loan to
the Borrower in such amount. The Agent shall remit the funds so
received to the Swingline Lender.
(b) If for any reason any Revolving Loan Borrowing
cannot be requested in accordance with Section 2.4.2(a or any
Swingline Loan cannot be refinanced by such a Revolving Loan
Borrowing, the request submitted by the Swingline Lender shall be
deemed to be a request by the Swingline Lender that each of the
Lenders fund its participation in the relevant Swingline Loan and
each Lender's payment to the Agent for the account of the
Swingline Lender pursuant to Section 2.4.2(a) shall be deemed
payment in respect of such participation.
(c) If any Lender fails to make available to the Agent
for the account of the Swingline Lender any amount required to be
paid by such Lender pursuant to the foregoing provisions of this
Section 2.4.2 by the time specified in Section 2.4.2(a), the
Swingline Lender shall be entitled to recover from such Lender
(acting through the Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to
the date on which such payment is immediately available to the
Swingline Lender at a rate per annum equal to the Federal Funds
Rate from time to time in effect. A certificate of the Swingline
Lender submitted to any Lender (through the Agent) with respect
to any amounts owing under this clause (c) shall be conclusive
absent manifest error.
(d) Each Lender's obligation to make Revolving Loans or
to purchase and fund participations in Swingline Loans pursuant
to this Section 2.4.2 shall be absolute and unconditional and
shall not be affected by any circumstance, including (i) any
set-off, counterclaim, recoupment, defense or other right which
such Lender may have against the Swingline Lender, the Borrower
or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a Default or Event of Default, or
(iii) any other occurrence, event or condition, whether or not
similar to any of the foregoing. Any such purchase of
participations shall not relieve or otherwise impair the
Obligation of the Borrower to repay Swingline Loans, together
with interest as provided herein.
2.4.3 Repayment of Participations.
---------------------------
(a) At any time after any Lender has purchased and
funded a participation in a Swingline Loan, if the Swingline
Lender receives any payment on account of such Swingline Loan,
the Swingline Lender will distribute to such Lender such Lender's
Percentage of such payment (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which
such Lender's participation was outstanding and funded) in the
same funds as those received by the Swingline Lender.
(b) If any payment received by the Swingline Lender in
respect of principal or interest on any Swingline Loan is
required to be returned by the Swingline Lender, each Lender
shall pay to the Swingline Lender such Lender's Percentage
thereof on demand of the Agent, plus interest thereon from the
date of such demand to the date such amount is returned, at a
rate per annum equal to the Federal Funds Rate. The Agent will
make such demand upon the request of the Swingline Lender.
(c) Until each Lender funds its Revolving Loan or
participation, in each case pursuant to this Section 2.4 to
refinance such Lender's Percentage of any Swingline Loan,
interest in respect of such Lender's Percentage thereof shall be
solely for the account of the Swingline Lender. Borrower shall
make payments of interest on each Swingline Loan at the time and
in the manner referred on Revolving Loan.
(d) Borrower shall make all payments of principal and
interest in respect of the Swingline Loans directly to the
Swingline Lender.
Section 2.5 Term Loan Procedures.
--------------------
2.5.1. Initial Term Loans. Each Initial Term Loan shall be
--------------------
represented by an Initial Term Loan Note.
2.5.2. Additional Term Loan Procedure.
------------------------------
(a) Each Additional Term Loan shall occur following
written request via such form as is attached in Exhibit 2.5.2 (a
"Term Loan Notice") or telephonic request to be confirmed by fax
in such form as is attached in Exhibit 2.5.2. Each such request
shall specify: (i) the effective date of the requested Additional
Term Loan; (ii) the amount thereof; and (iii) the portion of the
outstanding Revolving Loans to which such Additional Term Loan is
to be applied, if any, including the rate(s) of interest
currently applicable thereto and, if a Eurodollar rate is
applicable to any portion thereof, the Interest Period(s) that
was/were selected by Borrower at inception of the related
Revolving Loan. If and to the extent the Additional Term Loan is
to be an initial Advance (i.e. not being applied to any
outstanding Revolving Loans), then the Term Loan Notice or
request shall specify whether any portion(s) of such Term Loan
that is an initial Advance will bear interest at a Eurodollar
rate, and the interest period(s) selected by the Borrower with
respect thereto. No such Term Loan Notice or request shall be
effective unless and until Agent shall have received the
Additional Term Loan Notes in respect thereof specified at
Section 6.2 (c). If and to the extent any Additional Term Loan is
not an initial Advance, it shall bear interest at the same
rate(s) of interest applicable to the Revolving Loans that are
satisfied thereby provided however that, in determining such
Eurodollar rate(s), the applicable Margin shall be determined in
accordance with Section 4.7. If such Term Loan Notice is being
applied to Revolving Loans in the exact amount of such Revolving
Loans, then any request must be received by 10:00 a.m.
(California time) on the Bank Business Day that the Term Loan is
to occur. If and to the extent any Additional Term Loan that is
the subject of a Term Loan Notice represents an additional
Advance, it shall be funded as provided in the final sentence of
Section 2.5.2(b). Each Additional Term Loan shall be in an amount
of not less than Ten Million Dollars ($10,000,000). Any request
for any Additional Term Loan shall be deemed to be a
representation that all statements set forth in Article VII are
correct except to the extent the same relate specifically to an
earlier date.
(b) Upon receiving a request for a Term Loan Notice,
and in any event not later than 11:00 a.m. (California time) on
the day such Term Loan Notice is received, Agent will notify
each of the Lenders of the effective date of the requested
Additional Term Loan, the amount thereof and the portion of the
outstanding Revolving Loan to which such Additional Term Loan
is to be applied, if any, including the interest rate(s)
currently applicable thereto, if applicable, if any Eurodollar
Rate(s) is/are applicable to any portion thereof, the Interest
Period(s) that had been selected by Borrower at inception
thereof, or that are being selected, at the initial Advance of
such Term Loans, and a copy of the related Additional Term
Loan Note payable to such Lender duly executed on behalf of
Borrower. Promptly thereafter Agent shall deliver such Additional
Term Loan Note to such Lender. In the event all or any part of
any Term Loan that is the subject of a Term Loan Notice is an
initial Advance, the funding procedures set forth in Section
2.2.1(b) (excepting the first sentence thereof and substituting
the term "Term Loan" for "Revolving Loan" throughout) shall
apply.
Section 2.6 Use of Proceeds. The proceeds of the Advances shall
---------------
be used by the Borrower (i) to refinance existing indebtedness under the
Existing Credit Agreement including the Existing Term Loan; (ii) for its general
corporate purposes, including redemption of Subordinated Debt in connection with
redemption of trust preferred securities guaranteed by Borrower; and (iii) for
Permitted Acquisitions.
ARTICLE III.
EVIDENCING OF LOANS
Section 3.1 Notes. The Revolving Loans made by each Lender
-----
shall be evidenced by and repayable in accordance with a single promissory note
of Borrower payable to the order of such Lender substantially in the form of a
Revolving Note. The Swingline Loans made by Swingline Lender shall be evidenced
by a single promissory note of Borrower payable to the order of Swingline Lender
substantially in the form of the Swingline Note. The Initial Term Loan made by
each Lender shall be evidenced by and repayable in accordance with a single
promissory note of Borrower payable to the order of such Lender substantially in
the form of an Initial Term Loan Note. Each Additional Term Loan made by each
Lender shall be evidenced by and repayable in accordance with a separate
promissory note of Borrower payable to the order of such Lender substantially in
the Form of an Additional Term Loan Note.
Section 3.2 Payment of Initial and Additional Term Loan Notes.
--------------------------------------------------
The entire principal balance of each Initial Term Loan made by each Lender shall
be repaid in seven (7) equal quarterly installments, each equal to one-seventh
(1/7th) of such original principal balance and a final payment, equal to the
entire remaining principal balance of such Initial Term Loan (and all accrued
and unpaid interest thereon and other sums payable in connection therewith) due
on the Initial Term Loan Maturity Date. The entire original principal balance of
each Additional Term Loan made by each Lender shall be repaid in equal calendar
quarterly installments, each equal to six and twenty-five hundredths percent
(6.25%) of such original principal balance, and a final payment, equal to the
entire remaining principal balance (and all accrued and unpaid interest and
other sums payable in connection with such Additional Term Loan under this
Agreement), due on the related Additional Term Loan Maturity Date, which is the
absolute and final due date of such Additional Term Loan. The first such
quarterly installment (on all Initial Term Loans and any Additional Term Loans
that may then be outstanding) shall be due on September 30, 2007; thereafter
quarterly installments on any Initial Term Loans and Additional Term Loans then
outstanding shall be due on the last day of each calendar quarter, until the
latest occurring Additional Term Loan Maturity Date.
Section 3.3 Recordkeeping. The Agent shall record in its
-------------
records the date and amount of each Advance made by each Lender, shall record in
its records the date and amount of each such Advance, each repayment or
conversion thereof and, the case of each Borrowing that will bear interest (or
is converted to bear interest) at a Eurodollar Rate, the dates on which each
Interest Period for Borrowing shall begin and end. The aggregate unpaid
principal amount so recorded shall be rebuttably presumptive evidence of the
principal amount of the Borrowings owing and unpaid. The failure to so record
any such amount, or any error in so recording any such amount, shall not limit
or otherwise affect the Obligations of Borrower hereunder or under any Note to
pay the principal amount of all Borrowings hereunder, together with all interest
accruing thereon.
ARTICLE IV.
INTEREST
Section 4.1 Interest Rates. Subject to Section 4.7, Borrower
---------------
shall pay interest on the unpaid principal balance of each Borrowing, for the
period commencing on the date of such Borrowing until such Borrowing is repaid
in full, as follows:
(a) for each Revolving Loan, Term Loan, or Obligation
of Reimbursement, at all times and to the extent the Eurodollar
Rate is not applicable thereafter, the Floating Rate;
(b) for each Revolving or Term Loan to which the
Eurodollar Rate is applicable, the Eurodollar Rate; provided
however that, in determining such Eurodollar Rate, the applicable
Margin shall be determined in accordance with Section 4.7; and
(c) for each Swingline Loan, the Floating Rate.
Section 4.2 Default Interest Rate. Upon the occurrence of any
----------------------
Default or Event of Default, and so long as such Default or Event of Default
continues without written waiver thereof by the Required Lenders, each Note
shall bear interest at an annual rate that shall be four percent (4.00%) plus
the annual rate at which interest would otherwise accrue on that Note. Accrual
of interest at such increased rate shall not be deemed a waiver or excuse of any
such Default or Event of Default.
Section 4.3 Interest and Principal Payments.
-------------------------------
4.3.1 Interest. Interest accruing on the principal
--------
balance of the Notes shall be due and payable as follows:
(a) Interest accruing on the outstanding principal
balance of the Notes at the Floating Rate each
calendar quarter shall be due and payable on
the last day of that calendar quarter, with
the first quarterly payment of interest due on
the last day of September, 2007; and the last
payment of interest shall be due on the
Revolving Credit Termination Date with respect
to Revolving Notes and on the applicable
Initial and Additional Term Loan Maturity Dates
with respect to Term Notes.
(b) Interest on each Eurodollar Rate Funding shall
be due and payable on the last day of the
applicable Interest Period or, if such Interest
Period is six months, on the last day of the
third month during such Interest Period, and on
the last day of such Interest Period.
4.3.2 Principal. The principal balance of the Revolving
---------
Notes shall be due and payable in full on the Revolving Credit
Termination Date. The principal balance of the Term Notes shall
be due and payable on the applicable Initial and Additional Term
Loan Maturity Date.
4.3.3 Swingline Loans. The full principal balance of
----------------
all then outstanding Swingline Loans, together with all accrued
and unpaid interest thereon, shall be due and payable on the next
to occur following a Swingline Loan of the fifteenth (15th) day
of the month (or the next Bank Business Day if such day is a
Saturday, Sunday, United States national holiday or other day on
which banks in Minnesota are permitted or required by law to
close) and the last Bank Business Day of the month, and shall be
paid as provided in Section 2.4.
Section 4.4 Making of Payments. All payments of principal and
------------------
interest under the Notes and of all fees hereunder shall be made to the Agent in
immediately available funds. Payments received after 11:00 a.m. (California
time) on any day shall be deemed received on the next succeeding Bank Business
Day. The Borrower and the Lenders agree that the amount shown on the books and
records of the Agent as being the principal balance of each Lender's Note shall
be prima facie evidence of such principal amount. Borrower shall pay to Agent an
amount equal to the accrued interest and fees from time to time due and payable
to the Agent under the Notes or hereunder, or (at the option of the Required
Lenders) to make an Advance in such amount, as follows: (a) upon Agent's receipt
of written request by Borrower, the Borrower authorizes the Agent to charge
against any account the Borrower may maintain with Wells Fargo Bank, National
Association; or (b) the Borrower shall transfer by wire transfer of immediately
available funds by 11:00 a.m. (California time) on the date such accrued
interest and fees are due and payable to the account of the Agent most recently
designated by it in writing for such purpose.
Section 4.5 Payment on Nonbusiness Days. Payments of interest
---------------------------
on Eurodollar Rate Fundings shall be governed by Section 4.3.1(b). With respect
to all other payments to be made hereunder or under the Notes, whenever such
payments shall be stated to be due on a day other than a Bank Business Day, such
payment may be made on the next succeeding Bank Business Day, and such extension
of time shall in each case be included in the computation of payment of interest
on such Note or the fees hereunder, as the case may be.
Section 4.6 Computation of Interest and Fees. All interest
----------------------------------
under all Notes, and all fees under this Agreement, shall be computed on the
basis of actual number of days elapsed in a year of 360 days.
Section 4.7 Generally. The Revolving Loan Margin, the Term Loan
---------
Margin and the L/C Margin, shall be adjusted each quarter on the basis of the
Funded Debt Ratio as at the end of the previous fiscal quarter, in accordance
with the following table:
Funded Revolving Loan Margin Term Loan Margin L/C Margin
Debt Ratio (in Basis Points) (in Basis points) (in Basis Points)
- ---------- ----------------- ----------------- -----------------
Less than 1.00 to 1.00 75.0 87.5 87.5
1.00 to 1.00 or more, but 87.5 100.0 100.0
less than 1.75 to 1.00
1.75 to 1.00 or more 100.0 112.5 112.5
Reductions and increases in the Margins will be made quarterly on the first day
of the month following the date the Borrower's financial statements and
Compliance Certificate required under Section 8.1 are due. Notwithstanding the
foregoing, (i) if the Borrower fails to deliver any financial statements or
Compliance Certificates when required under Section 8.1, the Agent may (and,
upon request of the Required Lenders, shall), by notice to the Borrower,
increase the Margins to the highest rates set forth above until such time as the
Agent has received all such financial statements and Compliance Certificates,
and (ii) no reduction in any of the Margins will be made if a Default or an
Event of Default has occurred and is continuing at the time that such reduction
would otherwise be made.
ARTICLE V.
FEES, REDUCTIONS AND PREPAYMENTS
Section 5.1 Commitment Fee. The Borrower shall pay to the
--------------
Agent, for the benefit of the Lenders, a commitment fee at an annual rate equal
to 17.5 basis points (0.175%) applied to the aggregate daily average Unused
Amount of the Revolving Credit Commitment Amounts, as defined hereunder.
Outstanding Swingline Loans will be deemed utilizations of the Revolving Credit
Commitment Amounts for purposes of determining availability but not for purposes
of determining any commitment fee due hereunder. This commitment fee shall be
due and payable quarterly in arrears, with the first payment due September 30,
2007 for the period from the Closing Date through September 30, 2007, and
payments due quarterly thereafter. Any such commitment fee remaining unpaid on
the Revolving Credit Termination Date shall be due and payable on that date. As
used herein, the "Unused Amount of the Revolving Credit Commitment Amount" shall
mean, at any time, (a) the Revolving Credit Commitment Amounts at such time
minus (b) the sum of the then outstanding Revolving Loans, the then outstanding
- ----- Term Loans, and the then sum of issued Letters of Credit and any then
unpaid drawings under any Letters of Credit. For the avoidance of doubt,
Swingline Loans shall not be counted as Revolving Loans for purposes of
determining the Unused Amount of the Revolving Credit Commitment Amount.
Section 5.2 Letter of Credit Fees. The Borrower shall pay
------------------------
fees as follows:
(a) Letter of Credit Fees. The Borrower shall pay the
Agent for the benefit of the Lenders a fee with respect to each
Letter of Credit, if any, accruing on a daily basis and computed
at an annual rate equal to the L/C Margin of the aggregate
amount that may then be drawn on all issued and outstanding
Letters of Credit from and including the date of issuance of each
such Letter of Credit until such date as each such Letter of
Credit shall terminate by its terms or be fully drawn, due and
payable quarterly in arrears on the last day of each calendar
quarter, commencing September 30, 2007, and on the date when the
last Letter of Credit expires or is fully drawn. The foregoing
fee shall be in addition to any and all fees, commissions and
charges of the Agent with respect to or in connection with any
such Letter of Credit. Upon the occurrence of any Default or
Event of Default, and so long as such Default or Event of
Default continues without written waiver thereof by the Required
Lenders, the annual rate at which such fee accrues shall be four
percent (4.00%) plus the L/C Margin. Accrual of such fee at such
increased rate shall not be deemed a waiver or excuse of any such
Default or Event of Default.
(b) Letter of Credit Administrative Fees. The Borrower
shall pay the Agent, on demand, the administrative fees charged
by the Agent in connection with issuing Letters of Credit,
honoring drafts under Letters of Credit, amendments thereto,
transfers thereof and all other activity with respect to Letters
of Credit at the then-current rates published by the Agent for
such services rendered on behalf of customers of the Agent
generally and provided to the Borrower.
Section 5.3 Termination or Reduction of the Revolving Credit
---------------------------------------------------
Commitments. The Borrower may at any time and from time to time upon ten (10)
- -----------
calendar days' prior notice to the Agent permanently terminate the entire
Revolving Credit Commitment or permanently reduce such Commitment in part,
without penalty or premium, provided that (i) such Commitments may not be
terminated while any Advances remain outstanding, (ii) each partial reduction
shall be in the amount of $1,000,000 or a multiple thereof, (iii) any partial
reduction of such Commitments shall be pro rata as to each Lender in accordance
with that Lender's Percentage, and (iv) no reduction shall reduce such
Commitments to an amount less than the aggregate amount of the Advances
outstanding at the time.
Section 5.4 Voluntary Prepayments. The Borrower may prepay all
---------------------
or a portion of the principal balance of the Revolving and/or Term Loans bearing
interest at a Floating Rate (the "Floating Rate Portion") in whole or in part,
at any time and from time to time; provided that (i) prepayment of any Lender's
such Loan must be accompanied by pro rata prepayment of each other Lender's such
Loan, (ii) any prepayment of the full amount of any such Loan shall include
accrued interest thereon, and (iii) each partial prepayment of the Floating Rate
Portion of such Loans shall be in the principal amount of $1,000,000 or an
integral multiple of $100,000 greater than $1,000,000.
The Borrower may prepay the portion of the principal balance of
the Revolving and/or Term Loans bearing interest at a Eurodollar Rate (the
"Eurodollar Rate Portion") in whole or in part, at any time from time to time;
provided that (i) prepayment of any Lender's such Loan must be accompanied by
pro rata prepayment of each other Lender's such Loan, (ii) any prepayment of the
full amount of any such Loan shall include accrued interest thereon, (iii) each
partial prepayment of the Eurodollar Rate Portion of the Loans shall be in the
principal amount of $1,000,000 or an integral multiple of $100,000 greater than
$1,000,000, (iv) any prepayment of the Eurodollar Rate Portion of such Loans
shall be made only upon three Bank Business Days' notice to the Agent, and (v)
if the prepayment is made on a date other than the last day of the applicable
Interest Period, such prepayment must be accompanied by a written agreement from
Borrower to reimburse the Lenders for any amounts due to the Lenders pursuant to
Section 5.5(b).
Section 5.5 Fees on Advances and Indemnity. The Borrower shall
------------------------------
pay the following (in addition to any interest payable on Advances and any fees
or other amounts payable hereunder):
(a) If at any time the enactment of any new generally
applicable law, rule or regulation or the issuance of a generally
applicable interpretation or administration thereof by any
governmental authority (including, without limitation, Regulation
D of the Federal Reserve Board):
(i) shall subject any Lender to any tax, duty or
other charges including but not limited to any
tax designed to discourage the purchase or
acquisition of foreign securities or debt
instruments by United States nationals) with
respect to this Agreement, or shall materially
change the basis of taxation of payments to any
Lender of the principal of or interest on any
portion of the principal balance of the Notes
bearing interest at a Eurodollar Rate (except
for the imposition of or changes in respect of
the rate of tax on the overall net income of
that Lender); or
(ii) shall impose or deem applicable or increase any
reserve, special deposit or similar requirement
against assets of, deposits with or for the
account of, or credit extended by any Lender
because of any portion of the principal balance
of any Note bearing interest at a Eurodollar
Rate;
and the result of any of the foregoing would be to increase the
cost to that Lender of making or maintaining any such portion or
to reduce any sum received or receivable by that Lender with
respect to such portion, then, within 30 days after demand by any
Lender specifying the basis of the Lender's assertion in
reasonable detail, the Borrower shall pay that Lender such
additional amount or amounts as will compensate that Lender for
such increased cost or reduction; provided, however, that no
-------- -------
amount shall be payable by Borrower if the reason for the
additional charges, reserves, special deposit or similar
requirements against a particular Lender arises from a change in
the status of the Lender, rather than from the imposition of such
requirements against commercial lending institutions generally.
(b) The Borrower shall also compensate any Lender, upon
written request by that Lender (which request shall set forth the
basis for requesting such amounts), for all losses and expenses
in respect of any interest or other consideration paid by that
Lender to lenders of funds borrowed by it or deposited with it to
maintain any portion of the principal balance of any Note at a
Eurodollar Rate which that Lender may sustain to the extent not
otherwise compensated for hereunder and not mitigated by the
reemployment of such funds to the extent such loss or expense
arises (i) as a consequence of any failure by the Borrower to
make any payment when due of any amount due hereunder in
connection with any Eurodollar Rate Fundings, (ii) due to any
failure of the Borrower to borrow or convert any Eurodollar Rate
Fundings on a date specified therefor in a notice thereof, or
(iii) due to any payment or prepayment of any Eurodollar Rate
Funding on a date other than the last day of the applicable
Interest Period for such Eurodollar Rate Funding. A certificate
as to any such loss or expense (including calculations, in
reasonable detail, showing how that Lender computed such loss or
expense) shall be promptly submitted by that Lender to the
Borrower. Such loss or expense may be computed as though that
Lender acquired deposits in the London interbank market to fund
that portion of the principal balance whether or not that Lender
actually did so.
(c) A notice from any Lender under this Section 5.5
claiming compensation and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the
absence of error. In determining any such amount, a Lender may
use any reasonable averaging and attribution methods.
Section 5.6 Capital Adequacy. In addition to any interest on
-----------------
Advances, if any Lender determines at any time that its Return has been reduced
as a result of any Capital Adequacy Rule Change, that Lender may require that
the Borrower pay it the amount necessary to restore its Return to what it would
have been had there been no Capital Adequacy Rule Change. For purposes of this
Section:
(a) "Return," for any period, means the percentage
determined by dividing (i) the sum of interest and ongoing fees
earned by a Lender under this Agreement during such period, by
(ii) the average capital that Lender is required to maintain
during such period as a result of its being a party to this
Agreement, as reasonably determined in good faith by that Lender
based upon its total capital requirements pursuant to the Capital
Adequacy Rules then in effect. Return may be calculated for each
calendar quarter and for the shorter period between the end of a
calendar quarter and the date of termination in whole of this
Agreement.
(b) "Capital Adequacy Rule" means any law, rule,
regulation or guideline regarding capital adequacy that applies
to any Lender, or the interpretation thereof by any governmental
or regulatory authority with supervisory authority over such
Lender. Capital Adequacy Rules include rules requiring financial
institutions to maintain total capital in amounts based upon
percentages of outstanding loans, binding loan commitments and
letters of credit.
(c) "Capital Adequacy Rule Change" means any change
applicable to banks generally in any Capital Adequacy Rule
occurring after the date of this Agreement, but the term does not
include any changes in applicable requirements that at the date
hereof are scheduled to take place under the existing Capital
Adequacy Rules or any increases in the capital that any Lender is
required to maintain to the extent that the increases are
required due to a regulatory authority's action affecting only
that Lender.
(d) For purposes of this Section, "Lender" includes
(but is not limited to) the Agent, the Lenders, as defined
elsewhere in this Agreement, any assignee of any interest of any
Lender hereunder and any participant in the loans made hereunder.
The initial notice sent by a Lender shall be sent as promptly as practicable
after that Lender learns that its Return has been reduced, shall include a
demand for payment of the amount necessary to restore that Lender's Return for
the quarter in which the notice is sent, and shall state in reasonable detail
the cause for the reduction in its Return and its calculation of the amount of
such reduction. Thereafter, that Lender may send a new notice during each
calendar quarter setting forth the calculation of the reduced Return for that
quarter and including a demand for payment of the amount necessary to restore
its Return for that quarter.
Section 5.7 Failure of Any Lender to Make Advances. Should any
--------------------------------------
Lender default in making an Advance, the other Lenders shall not be released
from their several obligations to make Advances as agreed hereunder, and, in the
event such defaulting Lender is the Agent, the other Lenders shall forthwith
appoint one of themselves to act as Agent. However, such default shall not
obligate any of the Lenders to increase their Commitment Amounts. Without
limiting any other remedies to which the Borrower may be entitled, Borrower
shall be released from all liability to pay such defaulting Lender any accrued
or future fees under Section 5.1 and the other Obligations of the Borrower to
such defaulting Lender under the Loan Documents, except the Obligation to repay
any outstanding Swingline Loan, Term Loan and Revolving Loans theretofore made
by such Lender and interest accrued thereon as provided in the Loan Documents,
shall terminate; provided, however, once such default is cured, then such
-------- -------
defaulting Lender shall, subsequent thereto, have all rights under the Loan
Documents.
Section 5.8 Annual Agent's Fees. On each anniversary of the
--------------------
Closing Date, so long as any Obligation shall then be outstanding, Borrower
shall pay to Agent, as an Agent's fee and for Agent's sole benefit, the sum of
$4,000 multiplied by the number of Lenders who hold Obligations on such
anniversary date. The fee provided for at this Section 5.8 shall be in addition
to all fees provided for either elsewhere at this Article V or at Section 6(l).
ARTICLE VI.
CONDITIONS PRECEDENT
Section 6.1 Initial Conditions Precedent. The obligation of the
----------------------------
Lenders to make any Advance and the obligation of the Agent to issue its initial
Letter of Credit (whichever first occurs) is, in addition to the conditions
precedent specified in Section 6.2, subject to the condition precedent that the
Agent shall have received all of the following, each dated (unless otherwise
indicated) as of the date hereof, in form and substance satisfactory to each
Lender:
(a) The Notes, properly executed on behalf of the
Borrower.
(b) Current searches of appropriate filing offices
showing that (i) no state or federal tax liens have been
filed and remain in effect against any of the Borrower, First
Bank or San Francisco Company, (ii) no financing statements have
been filed and remain in effect against any of the Borrower,
First Bank or San Francisco Company except financing statements
perfecting only Liens permitted under Section 9.1, and (iii) no
judgment liens are in effect against any of the Borrower, First
Bank or San Francisco Company.
(c) Separate certificates of the secretaries of the
Borrower and San Francisco Company certifying, in the case of
each such corporation, (i) that the execution, delivery and
performance of the Loan Documents and other documents
contemplated hereunder to which such corporation is a party have
been duly approved by all necessary action of the Board of
Directors of such corporation, and attaching true and correct
copies of the applicable resolutions granting such approval, (ii)
that attached to such certificate are true and correct copies of
the current articles of incorporation and bylaws of such
corporation, as amended, together with such copies, and (iii) the
names of the officers of such corporation who are authorized to
sign the Loan Documents and other documents contemplated
hereunder to which such corporation is a party, including, with
respect to the Borrower, requests for Advances and L/C
Applications, together with the true signatures of such officers.
The Agent and the Lenders may conclusively rely on each such
certificate until they shall receive a further certificate of the
Secretary or Assistant Secretary of the applicable corporation
canceling or amending the prior certificate and submitting the
signatures of the officers named in such further certificate.
(d) A certificate of good standing of the Borrower, San
Francisco Company and First Bank, dated not more than twenty (20)
days before the date of the first Advance.
(e) A signed copy of an opinion of counsel for the
Borrower and San Francisco Company, addressed to the Lenders as
to matters referred to in Sections 7.1, 7.2, 7.3 and 7.7, and as
to such other matters as the Lenders may reasonably request, with
that opinion being subject to customary assumptions and
limitations and reasonably acceptable to each Lender's counsel.
In the case of Section 7.7, the opinion may be to the best
knowledge of such counsel, and, in the case of Section 7.3,
insofar as it relates to enforcement of remedies, it may be
subject to applicable bankruptcy, insolvency, reorganization or
similar laws affecting the rights of creditors generally from
time to time, and to usual equity principles.
(f) The Borrower Pledge Agreement, duly executed by the
Borrower.
(g) Certificates representing, in the aggregate, all of
the issued and outstanding capital stock of San Francisco Company
and one blank stock power executed by Borrower for each such
certificate.
(h) The San Francisco Company Security Agreement, duly
executed by San Francisco Company.
(i) Certificates representing, in the aggregate, all of
the issued and outstanding capital stock of First Bank and one
blank stock power executed by San Francisco Company for each such
certificate.
(j) The San Francisco Company Guaranty, duly executed
by San Francisco Company.
(k) Evidence that all of the Borrower's obligations
under the Existing Credit Agreement have been paid and discharged
in full, or will be so paid and discharged from proceeds of the
first Borrowing.
(l) The Borrower shall have paid to Agent for the
benefit of the Lenders and the Agent any fees provided for in the
Fee Letter agreement between Borrower and Agent dated July 9th,
2007. Fees provided for at this Section 6.1(l) shall be in
addition to all fees provided for at Article V hereof.
(m) The Borrower shall have paid to Polsinelli Shalton
Flanigan Suelthaus PC, counsel for the Agent ("PSFS"), all fees
and expenses of PSFS relating to the preparation and negotiation
of the Loan Documents.
It is acknowledged that Agent currently maintains possession of the documents
described in subsections (g) and (i) pursuant to the Existing Credit Agreement;
and that such possession will satisfy the requirements of such subsections.
Section 6.2 Conditions Precedent to All Advances. The
--------------------------------------------
obligation of each Lender to make any Advance (including the initial Advance)
and the obligation of the Agent to issue any Letter of Credit shall be subject
to the further conditions precedent that on the date of such Advance:
(a) The representations and warranties contained in
Article VII are correct on and as of the date of such Advance as
though made on and as of such date, except to the extent that
such representations and warranties relate solely to an earlier
date.
(b) No event has occurred and is continuing, or would
result from such Advance, which constitutes a Default or an Event
of Default.
(c) In the case of any Additional Term Loan, Agent
shall have received all Additional Term Loan Notes therefor,
payable to Lenders, all properly executed by Borrower.
ARTICLE VII.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders as follows:
Section 7.1 Corporate Existence and Power.
-----------------------------
(a) The Borrower (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of the state
of its incorporation, and is duly licensed or qualified to transact business in
all jurisdictions where the character of the property owned or leased or the
nature of the business transacted by it makes such licensing or qualification
necessary and where failure to be so licensed or qualified would have a
materially adverse impact on its business or properties; (ii) is in compliance
with the requirements of applicable laws and regulations, the noncompliance with
which would materially
and adversely affect its business or financial condition; and (iii) has all
requisite power and authority to conduct its business, to own its properties and
to execute and deliver, and to perform all of its Obligations under, the Loan
Documents.
(b) Each Subsidiary (i) is a business entity,
including, but not limited to any corporation, limited liability company,
partnership, limited partnership, limited liability partnership, business trust,
or any similar entity, duly incorporated or organized, as applicable, validly
existing and in good standing under the laws of the state of its incorporation,
organization, or formation, as applicable, and is duly licensed or qualified to
transact business in all jurisdictions where the character of the property owned
or leased or the nature of the business transacted by it makes such licensing or
qualification necessary and where failure to be so licensed or qualified would
have a materially adverse impact on its business or properties; (ii) is in
compliance with the requirements of applicable laws and regulations, the
noncompliance with which would materially and adversely affect its business or
financial condition; and (iii) has all requisite power and authority to conduct
its business, to own its properties and to execute and deliver, and to perform
all of its Obligations under, the Loan Documents.
Section 7.2 Authorization of Borrowing; No Conflict as to Law
---------------------------------------------------
or Agreements. The execution, delivery and performance by the Borrower and each
- -------------
of its Subsidiaries of the Loan Documents to which it is a party and the
Borrowings and requests for Letters of Credit from time to time hereunder have
been duly authorized by all necessary corporate action and do not and will not
(i) require any consent or approval of the stockholders of the Borrower or any
of its Subsidiaries, or any authorization, consent or approval by any
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, except such as have already been obtained, (ii) violate any
provision of any law, rule or regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System) or of any
order, writ, injunction or decree presently in effect having applicability to
the Borrower or any of its Subsidiaries or of the Articles of Incorporation or
Bylaws of the Borrower or any of its Subsidiaries (or Articles of Organization,
Operating Agreement, or any other governing document of a Subsidiary in the case
of a Subsidiary that is organized as a business entity other than a
corporation), (iii) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other material agreement, lease
or instrument to which the Borrower or any of its Subsidiaries is a party or
by which it or its properties may be bound or affected, or (iv) result in, or
require, the creation or imposition of any Lien or other charge or encumbrance
of any nature upon or with respect to any of the properties now owned or
hereafter acquired by the Borrower or any of its Subsidiaries.
Section 7.3 Legal Agreements. This Agreement and the other Loan
----------------
Documents to which it is a party constitute the legal, valid and binding
obligations of the Borrower and each of its Subsidiaries, as applicable,
enforceable against each such party in accordance with their respective terms.
Section 7.4 Subsidiaries. Except as listed in Schedule 7.4, as
------------
of the date of this Agreement the Borrower has no direct or indirect
Subsidiaries. The percentage of the capital stock of each Subsidiary owned by
the Borrower or by one or more other Subsidiaries is as set forth in Schedule
7.4.
Section 7.5 Financial Condition. The Borrower has heretofore
--------------------
furnished to the Lenders its audited financial statements as of December 31,
2006, and call reports of the Bank Subsidiaries dated as of March 31, 2007.
Those financial statements fairly present the financial condition of the
Borrower and its Subsidiaries on the dates thereof and the results of their
operations and cash flows for the periods then ended, and were prepared in
accordance with GAAP, subject, in the case of the interim financial statements,
to year-end audit adjustments.
Section 7.6 Adverse Change. There has been no material adverse
--------------
change in the business, properties or condition (financial or otherwise) of the
Borrower or its Subsidiaries since the date of the latest financial statements
referred to in Section 7.5.
Section 7.7 Litigation. Except as disclosed in Schedule 7.7, as
----------
of the date of this Agreement, there are no actions, suits or proceedings
pending or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or any of its Subsidiaries or the properties of the Borrower or any
of its Subsidiaries before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, which, if
determined adversely to the Borrower or any of its Subsidiaries, would have a
material adverse effect on the financial condition, properties, or operations of
the Borrower or any of its Subsidiaries.
Section 7.8 Regulation U. No part of the proceeds of any
------------
Advance will be used by the Borrower or any Bank Subsidiary directly or
indirectly, (i) to purchase or carry any margin stock (as defined in Regulation
U of the Board of Governors of the Federal Reserve System; herein, the "Board")
or to extend credit to others for the purpose of purchasing or carrying any
margin stock or (ii) for any purpose which entails a violation of, or which is
inconsistent with, the provisions of Regulation U issued by the Board.
Section 7.9 Taxes. The Borrower and each of its Subsidiaries
-----
has paid or caused to be paid to the proper authorities when due all federal,
state and local taxes required to be withheld by it. The Borrower and each of
its Subsidiaries has filed all federal, state and local tax returns which to the
knowledge of the officers of the Borrower are required to be filed, and the
Borrower and each of its Subsidiaries has paid or caused to be paid to the
respective taxing authorities all taxes as shown on said returns or on any
assessment received by it to the extent such taxes have become due, other than
taxes whose amount, applicability or validity is being contested in good faith
by appropriate proceedings and for which the Borrower or its Subsidiary, as
applicable, has provided adequate reserves in accordance with GAAP.
Section 7.10 Titles. The Borrower or its Subsidiaries, as
------
applicable, have good title to each of the material properties and assets
reflected in the latest audited financial statements referred to in Section 7.5.
Section 7.11 ERISA. As of the date of this Agreement, no Plan
-----
established or maintained by the Borrower or any ERISA Affiliate that is subject
to Part 3 of Subtitle B of Title I of ERISA had an accumulated funding
deficiency (as such term is defined in Section 302 of ERISA) in excess of
$1,000,000 as of the last day of the most recent fiscal year of such Plan ended
prior to the date hereof, and no liability to the PBGC or the Internal Revenue
Service in excess of such amount has been, or is expected by the Borrower or any
ERISA Affiliate to be, incurred with respect to any Plan of the Borrower or any
ERISA Affiliate. Neither the Borrower nor any of its Subsidiaries has any
contingent liability with respect to any post-retirement benefit under a Welfare
Plan as described in Section 3(1) of ERISA, other than liability for
continuation coverage described in Part 6 of Subtitle B of Title I of ERISA.
Section 7.12 Regulatory Matters. Borrower is registered as a
------------------
bank holding company under the Bank Holding Company Act, as amended ("BHCA").
First Bank is an "insured depository institution" as defined in the Federal
Deposit Insurance Act, as amended ("FDIA"), and the applicable regulations
thereunder and the deposits of First Bank are insured by the Bank Insurance Fund
of the Federal Deposit Insurance Corporation to the maximum extent permitted
under the FDIA.
ARTICLE VIII.
AFFIRMATIVE COVENANTS
So long as any Note or L/C Application or any other Obligation
shall remain unpaid, any Commitment shall be outstanding or the Agent shall have
any obligation to issue Letters of Credit, the Borrower will comply, and will
cause each of its Subsidiaries to comply, with the following requirements,
unless the Required Lenders shall otherwise consent in writing:
Section 8.1 Reporting Requirements. The Borrower will deliver
----------------------
to each Lender:
(a) As soon as available, and in any event within
ninety (90) days after the end of each fiscal year of the
Borrower, a copy of the annual audit report of the Borrower with
the unqualified opinion of independent certified public
accountants selected by the Borrower and to which the Agent and
the Required Lenders do not reasonably object.
(b) As soon as available, and in any event within
forty-five (45) days after the end of each fiscal quarter of the
Borrower, a copy of the Borrower's Quarterly Report on Form 10-Q
filed with the SEC with respect to such fiscal quarter, provided
however that, if Borrower shall cease to be required to file
Quarterly Reports on Form 10-Q, then its internally prepared
quarterly financial report, certified by its chief financial
officer, shall be provided within the same time period as Form
10-Q reports were required.
(c) As soon as available, and in any event within
ninety (90) days after the end of each fiscal year of the
Borrower, the Complete Annual Report of Domestic Holding
Companies (FRY-6 Report) required by the Federal Reserve Bank of
St. Louis.
(d) As soon as available, and in any event no later
than forty-five (45) days after the end of each calendar quarter,
the complete FRY-9LP and FRY-9C reports required to be filed by
the Borrower and its Subsidiaries quarterly with the Federal
Reserve Banks of the districts where they report.
(e) As soon as available, and in any event within
forty-five (45) days after the end of each calendar quarter, the
complete call report prepared by each Bank Subsidiary at the end
of such calendar quarter in compliance with the requirements of
any federal or state regulatory agency which has authority to
examine such Bank Subsidiary, prepared in accordance with the
requirements imposed by the applicable regulatory authorities and
applied on a basis consistent with the accounting practices
reflected in any previous call reports and similar statements
delivered to the Agent prior to the date of this Agreement.
(f) As soon as available, and in any event within
forty-five (45) days after the end of each calendar quarter, a
Compliance Certificate, duly executed by the chief financial
officer of the Borrower and one (1) additional officer of the
Borrower identified on the signature page of the form of
Compliance Certificate of which Exhibit 1.1 C is a copy.
(g) Promptly after the Borrower learns of the
commencement of any litigation or proceedings before any
governmental or regulatory agency that would be required to be
disclosed by Borrower pursuant to any applicable provision of
either the Securities Act of 1933, the Securities Exchange Act of
1934, or any applicable regulation under either thereof (assuming
that such litigation or proceeding had then been determined
adversely to the Borrower or any of its Subsidiaries), notice in
writing thereof. An 8K SEC filing will be considered prompt and
written notice under this requirement.
(h) As promptly as practicable (but in any event not
later than five (5) business days) after the Borrower or an
executive officer of any of its Subsidiaries obtains knowledge of
the occurrence of any Default or Event of Default, notice of such
occurrence, together with a detailed statement by a responsible
officer of the Borrower of the steps being taken by the Borrower
to cure the effect of such event.
(i) Promptly upon the filing thereof, copies of all
registration statements and all annual and quarterly reports
which the Borrower or any Subsidiary of the Borrower shall have
filed with the SEC.
(j) Such other information respecting the financial
condition and results of operations of the Borrower or any of its
Subsidiaries as any Lender may from time to time reasonably
request.
(k) Promptly after learning of the commencement of any
regulatory action involving safety or soundness issues with
respect to the Borrower or any Subsidiary, and, unless prohibited
by applicable law or regulation, not less than five (5) Business
Days before entering into any agreement or understanding
involving any such issues, notice in writing thereof.
Section 8.2 Books and Records; Inspection and Examination. The
---------------------------------------------
Borrower and each of its Subsidiaries will keep accurate books of record and
account for itself in which true and complete entries will be made in accordance
with GAAP and, upon request of any Lender, will give any representative of that
Lender reasonable access to, and permit such representative to examine, copy or
make extracts from, any and all books, records and documents in its possession,
to inspect any of its properties and to discuss its affairs, finances and
accounts with any of its principal officers, all at such times during normal
business hours and as often as any Lender may reasonably request; provided,
--------
however, that with respect to the loans made by any Bank Subsidiary, a Lender
- -------
may only review and make copies of summaries of the watch lists prepared on a
quarterly basis and loan credit reports; review of specific loan accounts and
loan review reports may be requested by any Lender, whereupon the Borrower and
such Lender shall within ten (10) days agree to the number of such accounts and
reports that are reasonable and appropriate to review; provided further,
-----------------
however, that during the continuance of any Default or Event of Default, there
- -------
shall be no restrictions upon the scope of the review, inspection and
reproduction rights of the Lenders concerning the loans of any Bank Subsidiary.
Section 8.3 Compliance with Laws. The Borrower and each of its
--------------------
Subsidiaries will comply with the requirements of applicable laws and
regulations, the noncompliance with which would materially and adversely affect
its business or the financial condition of the Borrower or any of its
Subsidiaries.
Section 8.4 Payment of Taxes and Other Claims. The Borrower and
---------------------------------
each of its Subsidiaries will pay or discharge, when due, (a) all taxes,
assessments and governmental charges levied or imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which penalties attach thereto, (b) all federal, state and local taxes required
to be withheld by it, and (c) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a Lien or charge upon any
properties of the Borrower or any of its Subsidiaries; provided, that neither
the Borrower nor any of its Subsidiaries shall be required to pay any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings and for which the Borrower or
its Subsidiary, as applicable, has provided adequate reserves in accordance with
GAAP.
Section 8.5 Operations. The Borrower will, and will cause each
----------
of its Subsidiaries to, operate and maintain its business and property in the
ordinary course in a prudent manner consistent with sound banking practices and
in such a manner that the performance by the Borrower of its Obligations
hereunder is not jeopardized or impaired.
Section 8.6 Insurance. The Borrower and each of its
---------
Subsidiaries will obtain and maintain insurance with insurers believed by it to
be responsible and reputable, in such amounts and against such risks as the
Borrower considers prudent and economical. Without limiting the foregoing, the
Borrower will cause the Bank Subsidiaries to maintain blanket bond coverage,
property and casualty coverage, and errors and omissions coverage as customary
for banks.
Section 8.7 Preservation of Corporate Existence. The Borrower
-----------------------------------
and each of its Subsidiaries will preserve and maintain its corporate existence
and all of its material rights, privileges and franchises; provided, however,
-------- -------
that neither the Borrower nor its Subsidiaries shall be required to preserve any
of its rights, privileges and franchises if its Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
its business and that the loss thereof is not disadvantageous in any material
respect to any Lender as a holder of a Note.
Section 8.8 Additional Collateral. The Borrower will deliver,
---------------------
and cause San Francisco Company to deliver, to the Agent any shares of capital
stock of any FDIC-insured financial institution or its holding company acquired
in whole or in part with the proceeds of Advances if either (A) 20 percent or
more of any class of the voting securities of such entity are acquired
(including for such purpose any such voting securities then owned by Borrower
and any Subsidiary), or (B) the Borrower's investment therein is $2 million or
more (including for such purpose any outstanding investment theretofore made);
provided, however, that the Borrower need not deliver such shares if such entity
- -------- -------
is immediately merged with or consolidated into a Subsidiary. Any shares of
capital stock so delivered shall constitute additional Collateral under the
Borrower Pledge Agreement (if delivered by the Borrower) or the San Francisco
Company Security Agreement (if delivered by San Francisco Company). The Borrower
need not deliver to the Agent any shares of capital stock of any FDIC-insured
financial institution or its holding company acquired in whole or in part with
the proceeds of Advances unless and until it either has acquired 20 percent or
more of any class of the voting securities or its investment therein becomes at
least $2 million or more; however the Borrower will not, and will not permit San
Francisco Company to, grant any security interest in such shares to any third
party.
Section 8.9 Notice of Permitted Acquisition. Within five (5)
-------------------------------
days after the Borrower or a Subsidiary enters into a definitive agreement in
connection with a Permitted Acquisition of an entity whose assets are equal to
or in excess of $500,000,000, the Borrower will notify the Agent of such
acquisition in writing. Any notice required by the immediately preceding
sentence shall be accompanied by a Schedule in the form of Exhibit 8.9, duly
completed and executed on behalf of the Borrower, demonstrating that the subject
Permitted Acquisition will not result in an Event of Default.
ARTICLE IX.
NEGATIVE COVENANTS
So long as any Note or any other Obligation shall remain unpaid,
any Commitments shall be outstanding, or the Agent shall have any obligation to
issue Letters of Credit, the Borrower will comply, and will cause each of its
Subsidiaries to comply, with the following covenants unless the Required Lenders
shall otherwise consent in writing:
Section 9.1 Liens. The Borrower will not create, incur, assume
-----
or suffer to exist, or permit San Francisco Company to create, incur, assume or
suffer to exist, any Lien or other charge or encumbrance of any nature on any of
the Collateral, now owned or hereafter acquired, or assign or otherwise convey
any right to receive income with respect to the Collateral or give its consent
to the subordination of any right or claim of the Borrower to any right or claim
of any other Person.
Section 9.2 Indebtedness. Neither the Borrower nor any of its
------------
Subsidiaries that are not Bank Subsidiaries will incur, create, assume or permit
to exist any indebtedness or liability on account of deposits or advances or any
indebtedness for borrowed money, or any other indebtedness or liability
evidenced by notes, bonds, debentures or similar obligations, except:
(a) Indebtedness to the Lenders under the Notes.
(b) Indebtedness of the Borrower or its Subsidiaries
listed in Schedule 9.2 hereto, and any extensions or renewals
thereof.
(c) Indebtedness of the Borrower or any of its
Subsidiaries that may be treated as regulatory capital, or that
is issued to provide a source of repayment of securities that may
be treated as regulatory capital, of the Borrower or such
Subsidiary.
(d) Subordinated Debt, or renewals or extensions
thereof.
(e) Indebtedness not otherwise permitted under this
Section 9.2, so long as all such indebtedness does not exceed
$5,000,000 in the aggregate outstanding at any one time.
Section 9.3 Guaranties. Neither the Borrower nor any of its
----------
Subsidiaries will assume, guarantee, endorse or otherwise become directly or
contingently liable in connection with any obligations of any other Person,
except:
(a) The endorsement of negotiable instruments by the
Borrower or any of its Subsidiaries for deposit or collection or
similar transactions in the ordinary course of business.
(b) Guaranties, endorsements and other direct or
contingent liabilities in connection with the obligations of
other Persons in existence on the date hereof and listed in
Schedule 9.3 hereto.
(c) Letters of credit and other obligations in the
nature of guaranties incurred by the Bank Subsidiaries in the
ordinary course of their banking businesses.
(d) Guaranties of obligations permitted by Section 9.2
(c).
(e) Other assumptions, guarantees, endorsements and
similar liabilities in connection with obligations of other
Persons, not in excess of $5,000,000 in the aggregate outstanding
at any one time.
Section 9.4 Shareholder Redemptions. The Borrower will not make
-----------------------
any payments on account of the purchase, redemption or other retirement of any
of its common stock or preferred stock, directly or indirectly.
Section 9.5 Acquisitions. Neither the Borrower nor any of its
------------
Subsidiaries will engage in an Acquisition with any Person, whether as acquirer
or acquiree, or engage in any other transaction analogous in purpose or effect
to an Acquisition, except that the foregoing shall not prohibit any Permitted
Acquisition.
Section 9.6 Subordinated Debt. Neither the Borrower nor any of
-----------------
its Subsidiaries will (i) make any payment of, or acquire, any Subordinated Debt
except as expressly permitted by the subordination provision thereof; (ii) give
security for all or any part of such Subordinated Debt; (iii) amend or cancel
the subordination provisions of such Subordinated Debt; (iv) take or omit to
take any action as a result of which the subordination of such Subordinated Debt
or any part thereof to the Notes might be terminated, impaired or adversely
affected; or (v) omit to give the Lenders prompt written notice of any default
under any agreement or instrument relating to such Subordinated Debt by reason
whereof such Subordinated Debt might become or be declared to be immediately due
and payable.
Section 9.7 Restrictions on Nature of Business. The Borrower
-----------------------------------
will not, and will not permit any of its Subsidiaries to, change the nature of
its business substantially, and will not engage, or permit any of its
Subsidiaries 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
predominantly the banking and thrift business (including activities deemed
closely related to banking and/or thrift business by applicable regulatory
authorities) as currently constituted.
Section 9.8 Negative Pledges; Subsidiary Restrictions. The
--------------------------------------------
Borrower will not, and will not permit any Subsidiary (including Bank
Subsidiaries) to, enter into any agreement, bond, note or other instrument with
or for the benefit of any Person other than the Lenders which would (i) prohibit
the Borrower or such Subsidiary from granting, or otherwise limit the ability of
the Borrower or such Subsidiary to grant, to the Lenders any Lien on any assets
or properties of the Borrower or such Subsidiary (it being agreed, however, that
nothing herein shall preclude the Bank Subsidiaries from granting security
interests to secure deposits or secured obligations to a Federal Home Loan
Bank), or (ii) require the Borrower or such Subsidiary to grant a Lien to any
other Person if the Borrower or such Subsidiary grants any Lien to the Lenders.
Except pursuant to any applicable law or regulation, the Borrower will not
permit any Subsidiary to place or allow any restriction, directly or indirectly,
on the ability of such Subsidiary to (a) pay dividends or any distributions on
or with respect to such Subsidiary's capital stock or (b) make loans or other
cash payments to the Borrower.
Section 9.9 Issuance of Additional Stock. Neither the Borrower
----------------------------
nor any Subsidiary whose shares are pledged pursuant to either the Borrower
Pledge Agreement or the San Francisco Company Security Agreement will (and
Borrower will not permit any of the same) to issue any additional shares of
capital stock unless such additional shares are immediately pledged pursuant to
the Borrower Pledge Agreement or the San Francisco Company Security Agreement,
as applicable.
Section 9.10 Regulatory Matters. Borrower shall not cease to be
------------------
registered as a bank holding company under the BHCA. First Bank shall not cease
to be an insured depository institution as defined in the FDIA nor shall its
deposits cease to be insured by the Bank Insurance Fund of the Federal Deposit
Insurance Corporation to the maximum extent permitted under the FDIA.
Section 9.11 Dividends. Neither Borrower nor any Subsidiary
---------
shall pay any dividends or make any distribution in respect of its common or
preferred stock (other than dividends payable in the payor's own common stock or
dividends paid to Borrower) excepting only that (i) the Borrower may declare or
pay cash dividends to holders of the common or preferred stock of Borrower
provided the aggregate amount of all such cash dividends declared or paid in
such fiscal year do not exceed 25% of Borrower's consolidated net income for the
immediately preceding fiscal year and (ii) a trust issuer may pay distributions
on both its trust preferred securities and its common securities, in each case
in accordance with their respective terms; provided however that,
notwithstanding the foregoing, no cash dividends or other distribution may be
declared or paid if either a Default exists on the date of such declaration or
payment or a Default will result therefrom.
ARTICLE X.
FINANCIAL COVENANTS
Section 10.1 Total Risk Based Capital Ratio. The Borrower shall
------------------------------
maintain on a consolidated basis, and shall cause each Bank Subsidiary to
maintain, its Total Risk Based Capital Ratio at not less than ten percent (10%),
determined as of each quarter end.
Section 10.2 Tier I Risk Based Capital Ratio. The Borrower shall
-------------------------------
maintain on a consolidated basis, and shall cause each Bank Subsidiary to
maintain, its Tier I Risk Based Capital Ratio at not less than six percent (6%),
determined as of each quarter end.
Section 10.3 Leverage Ratio. The Borrower shall maintain on a
--------------
consolidated basis, and shall cause each Bank Subsidiary to maintain, a minimum
Tier I Leverage Ratio of not less than 5%, determined as of each quarter end.
Section 10.4 Minimum Return on Assets. The Borrower will
----------------------------
maintain (on a consolidated basis) its Return on Assets, determined as of each
calendar quarter end, at not less than .70%.
Section 10.5 Maximum Non-Performing Assets. The Borrower will
------------------------------
maintain on a consolidated basis, its Non-Performing Assets at an amount not
greater than twenty percent (20%) of its Primary Equity Capital, determined as
of the end of each calendar quarter.
Section 10.6 Allowance for Loan and Lease Losses. The Borrower
------------------------------------
will maintain, on a consolidated basis, its allowance for loan and lease losses
at not less than 100% of its Non-Performing Assets. The allowance for loan and
lease losses at any time shall be the amount set forth in the most recent
quarterly report on Form 10-Q or annual report on Form 10-K filed by the
Borrower with the SEC (or any successor report); provided however that if
Borrower shall cease to be required to file quarterly reports on Form 10-Q
and/or annual reports on Form 10-K, thereafter the allowance for loan and lease
losses at any time shall be as set forth in Borrower's quarterly financial
report, certified by Borrower's Chief Financial Officer, and annual audit
report, certified by the auditor of such annual audit report.
ARTICLE XI.
EVENTS OF DEFAULT, RIGHTS AND REMEDIES
Section 11.1 Events of Default. "Event of Default", wherever
-------------------
used herein, means any one of the following events:
(a) Default in the payment of principal of any Note
when the same becomes due and payable.
(b) Default in the payment of interest on any Note or
of any fees or other amounts required to be paid under this
Agreement, and the continuance of such default for a period of
ten days or more.
(c) Failure to pay when due any amount specified in
Section 2.3.2 hereof relating to the Borrower's Obligation of
Reimbursement, or failure to pay immediately when due any amounts
required to be paid for deposit in the Special Account.
(d) Default in the performance, or breach, of any
covenant or agreement on the part of the Borrower contained in
any Financial Covenant or in Article IX hereof.
(e) Default in a material respect in the performance,
or breach, of any covenant or agreement of the Borrower in this
Agreement (other than a covenant or agreement a default in whose
performance or whose breach is elsewhere specifically dealt with
in this Section), and the continuance of such default or breach
for a period of 30 days after the date on which an executive
officer of the Borrower or any of its Subsidiaries first obtains
knowledge of such default or breach.
(f) Any representation or warranty made by the Borrower
in this Agreement or by the Borrower (or any of its officers) or
any of its Subsidiaries (or any of its officers) in any other
Loan Document, certificate, instrument, or statement contemplated
by or made or delivered pursuant to or in connection with this
Agreement, shall prove to have been incorrect or misleading in
any material respect when made.
(g) A default under any bond, debenture, note or other
evidence of indebtedness of the Borrower or any of its
Subsidiaries in excess of $2,000,000 (other than to the Lenders)
or under any indenture or other instrument under which any such
evidence of indebtedness has been issued or by which it is
governed where a party thereto has the right to accelerate any
indebtedness owing thereunder to such party from the Borrower or
any of its Subsidiaries as a result of such default, or any
default by the Borrower or any of its Subsidiaries in the payment
of required principal or interest under any of the foregoing
agreements or instruments.
(h) An event of default shall occur under any security
agreement, mortgage, deed of trust, assignment or other
instrument or agreement directly or indirectly securing any
Obligations of the Borrower hereunder or under any Note or under
any guaranty of such Obligations.
(i) Default in the payment of any amount in excess of
$2,000,000 owed by the Borrower or any of its Subsidiaries to any
Lender other than hereunder or under the Notes and the expiration
of the applicable period of grace, if any, with respect thereto;
provided, however, that if such default shall be cured by the
-------- -------
Borrower or its Subsidiary, as applicable, as may be permitted by
the terms of such indebtedness, or waived by the Lender holding
such indebtedness, in each case prior to the commencement of any
action under Section 11.2, then the Event of Default hereunder by
reason of such default shall be deemed likewise to have been
thereupon cured or waived.
(j) The Borrower or any of its Subsidiaries shall be
adjudicated a bankrupt or insolvent, or admit in writing its
inability to pay its debts as they mature, or make an assignment
for the benefit of creditors; or the Borrower or any of its
Subsidiaries shall apply for or consent to the appointment of any
receiver, trustee, or similar officer for it or for all or any
substantial part of its property; or such receiver, trustee or
similar officer shall be appointed without the application or
consent of the Borrower or its Subsidiary, as applicable, and
such appointment shall continue undischarged for a period of
thirty (30) days; or the Borrower or any of its Subsidiaries
shall institute (by petition, application, answer, consent or
otherwise) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, dissolution, liquidation or
similar proceeding relating to it under the laws of any
jurisdiction; or any such proceeding shall be instituted (by
petition, application or otherwise) against the Borrower or any
of its Subsidiaries and shall continue without dismissal for a
period of thirty (30) calendar days; or any judgment, writ,
warrant of attachment or execution or similar process shall be
issued or levied against a substantial part of the property of
the Borrower or any of its Subsidiaries and such judgment, writ,
or similar process shall not be released, vacated or fully bonded
within thirty (30) days after its issue or levy.
(k) A petition shall be filed by the Borrower or any
of its Subsidiaries under the United States Bankruptcy Code
naming the Borrower or any of its Subsidiaries as debtor; or an
involuntary petition shall be filed against the Borrower or any
of its Subsidiaries under the United States Bankruptcy Code, and
such petition shall not have been dismissed within forty-five
(45) days after the Borrower or the applicable Subsidiary has
received notice of such filing; or an order for relief shall be
entered in any case under the United States Bankruptcy Code
naming the Borrower or any of its Subsidiaries as debtor.
(l) The rendering against the Borrower or any of its
Subsidiaries of a final judgment, decree or order for the payment
of money in excess of Ten Million Dollars ($10,000,000) and the
continuance of such judgment, decree or order unsatisfied and in
effect for any period of thirty (30) consecutive days without a
stay of execution or other similar relief.
(m) A writ of attachment, garnishment, levy or similar
process shall be issued against or served upon the Agent or any
Lender with respect to (i) any property of the Borrower or any of
its Subsidiaries in the possession of the Agent or such Lender,
or (ii) any indebtedness of the Agent or such Lender to the
Borrower or any of its Subsidiaries, and the same shall not be
lifted within 30 days.
(n) A trustee shall have been appointed by an
appropriate United States District Court to administer any Plan,
or the PBGC, shall have instituted proceedings to terminate any
Plan or to appoint a trustee to administer any Plan, or
withdrawal liability shall have been asserted against the
Borrower or any ERISA Affiliate by a Multiemployer Plan; or the
Borrower or any ERISA Affiliate shall have incurred liability to
the PBGC, the Internal Revenue Service, the Department of Labor
or Plan participants in excess of $2,000,000 with respect to any
Plan; or any Reportable Event that the Required Lenders may
determine in good faith might constitute grounds for the
termination of any Plan, for the appointment by the appropriate
United States District Court of a trustee to administer any Plan
or for the imposition of withdrawal liability with respect to a
Multiemployer Plan, shall have occurred and be continuing thirty
(30) days after written notice to such effect shall have been
given to the Borrower by the Lenders.
(o) The issuance against the Borrower or any Subsidiary
of the Borrower (including without limitation, any Bank
Subsidiary) of any informal or formal administrative action,
temporary or permanent, by any federal or state regulatory agency
having jurisdiction or control over the Borrower or such
Subsidiary, such action taking the form of, but not limited to:
(i) any directive citing conditions or activities deemed to be
unsafe or unsound or breaches of fiduciary duty or law or
regulation; (ii) a memorandum of understanding; (iii) a cease and
desist order; (iv) the termination of insurance coverage of
customer deposits by the Federal Deposit Insurance Corporation;
(v) the suspension or removal of an executive officer or
director, or the prohibition of participation by any others in
the business affairs of the Borrower or such Subsidiary; (vi) a
capital maintenance agreement; or (vii) any other regulatory
action, agreement or understanding involving safety or soundness
issues with respect to the Borrower or such Subsidiary which the
Required Lenders reasonably believe may have a material adverse
effect on Borrower or any Subsidiary. An Event of Default under
clause (vii) above shall occur only upon written notice to
Borrower of the Required Lenders' determination.
(p) James F. Dierberg, Mary W. Dierberg, members of
their immediate family, and trusts, partnerships and other
organizations of which they have effective voting Control shall
cease to own in the aggregate at least fifty-one percent (51%) of
the voting shares of the Borrower.
Section 11.2 Rights and Remedies. Upon the occurrence of an
-------------------
Event of Default or at any time thereafter until such Event of Default is cured
to the written satisfaction of the Required Lenders, the Agent may, with the
consent of the Required Lenders, and shall, upon written request of the Required
Lenders:
(a) By notice to the Borrower, declare the Commitments
and the Agent's obligation to issue Letters of Credit to be
terminated, whereupon the same shall forthwith terminate.
(b) By notice to the Borrower, declare the entire
unpaid principal amount of the Notes then outstanding, all
interest accrued and unpaid thereon, and all other amounts
payable under this Agreement to be forthwith due and payable,
whereupon the Notes, all such accrued 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.
(c) By notice to the Borrower, require the Borrower to
pay to the Agent in immediately available funds, for deposit in
the Special Account, an amount equal to the maximum aggregate
amount available to be drawn under all Letters of Credit then
outstanding.
(d) Without notice to the Borrower and without further
action, apply (and direct each Lender to apply) any and all money
owing by any Lender to the Borrower to the payment of the Notes
then outstanding, including interest accrued thereon, and of all
other Obligations.
(e) Exercise any other rights and remedies available to
the Agent and the Lenders by law or agreement.
Notwithstanding the foregoing, upon the occurrence of an Event of Default
described in Section 11.1(j) or (k) hereof, the entire unpaid principal amount
of the Notes then outstanding, all interest accrued and unpaid thereon, and all
other Obligations shall be immediately due and payable without presentment,
demand, protest or notice of any kind.
Section 11.3 Offset. In addition to the remedies set forth in
------
Section 11.2, upon the occurrence of any Event of Default and thereafter while
the same be continuing, the Borrower hereby irrevocably authorizes each Lender
to set off any Obligations owed to such Lender (including for this purpose all
participations in Letters of Credit owned by such Lender) against all deposits
and credits of the Borrower with, and any and all claims of the Borrower
against, such Lender. Such right shall exist whether or not such Lender shall
have made any demand hereunder or under any other Loan Document, whether or not
the Obligations, or any part thereof, or deposits and credits held for the
account of the Borrower is or are matured or unmatured, and regardless of the
existence or adequacy of any collateral, guaranty or any other security, right
or remedy available to such Lender or Lenders. Each Lender agrees that, as
promptly as is reasonably possible after the exercise of any such setoff right,
it shall notify the Borrower of its exercise of such setoff right; provided,
--------
however, that the failure of such Lender to provide such notice shall not affect
- -------
the validity of the exercise of such setoff rights.
ARTICLE XII.
THE AGENT
Section 12.1 Authorization. Each Lender and the holder of each
-------------
Note irrevocably appoints and authorizes the Agent to act on behalf of such
Lender or holder to the extent provided herein or in any document or instrument
delivered hereunder or in connection herewith, and to take such other action as
may be reasonably incidental thereto.
Section 12.2 Distribution of Payments and Proceeds.
-------------------------------------
(a) After deduction of any costs of collection as
hereinafter provided, the Agent shall remit to each Lender that
Lender's Percentage of all payments of principal, interest, fees
and other amounts for the account of the Lenders that are
received by the Agent under the Loan Documents. Each Lender's
interest in the Loan Documents shall be payable solely from
payments, collections and proceeds actually received by the Agent
under the Loan Documents; and the Agent's only liability to the
Lenders hereunder shall be to account for each Lender's
Percentage of such payments, collections and proceeds in
accordance with this Agreement. If the Agent is ever required for
any reason to refund any such payments, collections or proceeds,
each Lender will refund to the Agent, upon demand, its Percentage
of such payments, collections or proceeds, together with its
Percentage of interest or penalties, if any, payable by the Agent
in connection with such refund. The Agent may, in its sole
discretion, make payment to the Lenders in anticipation of
receipt of payment from the Borrower. If the Agent fails to
receive any such anticipated payment from the Borrower, each
Lender shall promptly refund to the Agent, upon demand, any such
payment made to it in anticipation of payment from the Borrower,
together with interest for each day on such amount until so
refunded at a rate equal to the Federal Funds Rate for each such
date.
(b) Notwithstanding the foregoing, if any Lender has
wrongfully refused to fund its Percentage of any Borrowing or
other Advance as required hereunder, or if the principal balance
of any Lender's Note is for any other reason less than its
Percentage of the aggregate principal balances of the Notes then
outstanding, the Agent may remit all payments received by it to
the other Lenders until such payments have reduced the aggregate
amounts owed by the Borrower to the extent that the aggregate
amount owing to such Lender hereunder is equal to its Percentage
of the aggregate amount owing to all of the Lenders hereunder.
The provisions of this paragraph are intended only to set forth
certain rules for the application of payments, proceeds and
collections in the event that a Lender has breached its
obligations hereunder and shall not be deemed to excuse any
Lender from such obligations.
Section 12.3 Expenses. All payments, collections and proceeds
--------
received or effected by the Agent may be applied, first, to pay or reimburse the
Agent for all costs, expenses, damages and liabilities at any time incurred by
or imposed upon the Agent in connection with this Agreement or any other Loan
Document (including but not limited to all reasonable attorney's fees,
foreclosure expenses and advances made to protect the security of any
Collateral). If the Agent does not receive payments, collections or proceeds
sufficient to cover any such costs, expenses, damages or liabilities within
thirty (30) days after their incurrence or imposition, each Lender shall, upon
demand, remit to the Agent its Percentage of the difference between (i) such
costs, expenses, damages and liabilities, and (ii) such payments, collections
and proceeds.
Section 12.4 Payments Received Directly by Lenders. If any
-----------------------------------------
Lender or other holder of a Note shall obtain any payment or other recovery
(whether voluntary, involuntary, by application of offset or otherwise) on
account of principal of or interest on any Note other than through distributions
made in accordance with Section 12.2, such Lender or holder shall promptly give
notice of such fact to the Agent and shall purchase from the other Lenders or
holders such participations in the Notes held by them as shall be necessary to
cause the purchasing Lender or holder to share the excess payment or other
recovery ratably with each of them; provided, however, that if all or any
-------- -------
portion of the excess payment or other recovery is thereafter recovered from
such purchasing Lender or holder, the purchase shall be rescinded and the
purchasing Lender restored to the extent of such recovery (but without interest
thereon).
Section 12.5 Indemnification. The Agent shall not be required to
---------------
do any act hereunder or under any other document or instrument delivered
hereunder or in connection herewith or take any action toward the execution or
enforcement of the agency hereby created, or to prosecute or defend any suit in
respect of this Agreement or the Notes or any documents or instrument delivered
hereunder or in connection herewith unless indemnified to its satisfaction by
the holders of the Notes against loss, cost, liability and expense; provided,
--------
however, that no Lender shall be obligated to indemnify the Agent for any
- -------
portion of any such loss, cost, liability or expense resulting from the gross
negligence or willful misconduct of the Agent. If any indemnity furnished to the
Agent for any purpose shall, in the opinion of the Agent, be insufficient or
become impaired, the Agent may call for additional indemnity and not commence or
cease to do the acts indemnified against until such additional indemnity is
furnished.
Section 12.6 Limitations on Agent's Power. Notwithstanding any
----------------------------
other provision of this Agreement, the Agent shall not have the power, without
the consent of all of the Lenders, to (i) forgive any indebtedness of the
Borrower arising under this Agreement or the Notes, (ii) agree to reduce the
rate of interest charged under this Agreement or the commitment or Letter of
Credit fees payable under Sections 5.1 and 5.2, (iii) agree to extend the
maturity or decrease the amount of any payment (whether of principal, interest,
fees or otherwise) due under this Agreement or the Notes, (iv) release any
Collateral from the Lien created by the Borrower Pledge Agreement or the San
Francisco Company Security Agreement, or (v) amend the definition of "Required
Lenders" in Section 1.1. In addition, in no event may the Agent increase the
total Commitment Amount (being the aggregate sum of all Commitment Amounts of
all Lenders) hereunder without the consent of all Lenders (except as otherwise
provided for in Section 2.1.2) or increase or decrease the Commitment Amount of
any given Lender without the consent of that Lender.
Section 12.7 Exculpation. The Agent shall be entitled to rely
-----------
upon advice of counsel concerning legal matters, and upon this Agreement, any
Loan Document and any schedule, certificate, statement, report, notice or other
writing which it believes to be genuine or to have been presented by a proper
Person. Neither the Agent nor any of its directors, officers, employees or
agents shall (a) be responsible for any recitals, representations or warranties
contained in, or for the execution, validity, genuineness, effectiveness or
enforceability of this Agreement, any Loan Document, or any other instrument or
document delivered hereunder or in connection herewith, (b) be responsible for
the validity, genuineness, perfection, effectiveness, enforceability, existence,
value or enforcement of any collateral security, (c) be under any duty to
inquire into or pass upon any of the foregoing matters, or to make any inquiry
concerning the performance by the Borrower or any other obligor of its
Obligations, or (d) in any event, be liable as such for any action taken or
omitted by it or them, except for its or their own gross negligence or willful
misconduct. The agency hereby created shall in no way impair or affect any of
the rights and powers of, or impose any duties or obligations upon, the Agent in
its individual capacity.
Section 12.8 Agent and Affiliates. The Agent shall have the same
--------------------
rights and powers hereunder in its individual capacity as any other Lender, and
may exercise or refrain from exercising the same as though it were not the
Agent, and the Agent and its affiliates may accept deposits from and generally
engage in any kind of business with the Borrower as fully as if the Agent were
not the Agent hereunder.
Section 12.9 Credit Investigation. Each Lender acknowledges that
--------------------
it has made such inquiries and taken such care on its own behalf as would have
been the case had its Commitment been granted and the Advances made directly by
such Lender to the Borrower without the intervention of the Agent or any other
Lender. Each Lender agrees and acknowledges that the Agent makes no
representations or warranties about the creditworthiness of the Borrower, any
Subsidiary or any other party to this Agreement or with respect to the legality,
validity, sufficiency or enforceability of this Agreement, any Loan Document, or
any other instrument or document delivered hereunder or in connection herewith.
Section 12.10 Resignation. The Agent may resign as such at any
-----------
time upon at least thirty (30) calendar days' prior notice to the Borrower and
the Lenders. In the event of any resignation of the Agent, the Required Lenders
shall as promptly as practicable appoint a successor Agent. If no such successor
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty (30) calendar days after the resigning
Agent's giving of notice of resignation, then the resigning Agent may, on behalf
of the Lenders, appoint a successor Agent, which shall be a commercial bank
organized under the laws of the United States of America or of any State
thereof. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon be entitled to receive
from the prior Agent such documents of transfer and assignment as such successor
Agent may reasonably request and the resigning Agent shall be discharged from
its duties and obligations under this Agreement. After any resignation pursuant
to this Section, the provisions of this Section shall inure to the benefit of
the resigning Agent as to any actions taken or omitted to be taken by it while
it was an Agent hereunder.
Section 12.11 Assignments.
-----------
(a) No Lender may assign any of its rights or
obligations under any Loan Document without the prior written
consent of the Borrower and the Agent, which consent may not be
unreasonably withheld; provided, however, that the consent of the
-------- -------
Borrower shall not be required in connection with any such
assignment made at any time when a Default or an Event of Default
has occurred and is continuing. Any assignment permitted
hereunder shall be by written assignment agreement in form and
substance reasonably satisfactory to Agent which assignment
agreement shall be acknowledged by both Agent and Borrower. The
aggregate principal amount of the Notes and the portion of the
Commitment Amounts so assigned in any assignment shall be not
less than $5,000,000, and the assigning Lender shall retain at
least $5,000,000 of such Notes and Commitment Amounts for its own
account; provided, however, that the foregoing restriction shall
-------- -------
not apply to a Lender assigning its entire Note and Commitment
Amount to a single institution. Simultaneously with each
assignment of Notes and Commitment Amounts, the assigning Lender
shall be deemed to have assigned a proportional share of its
obligations and rights under Section 2.3.1(b). If the Agent and
(if applicable) the Borrower so consent, then, from and after the
effective date of any such assignment, the assignee thereunder
(an "Additional Lender") shall, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such
assignment, have the rights and obligations so assigned to it,
and the assigning Lender shall, to the extent that rights and
obligations have been assigned by it pursuant to such assignment,
relinquish its rights and be released from its obligations under
this Agreement. Within five (5) Bank Business Days after any
request of the Agent following such assignment of Notes and
Commitment Amounts, the Borrower will execute and deliver to the
Agent new Notes to the order of such assignee in amounts
corresponding to the interest in the assigning Lender's rights
and obligations under this Agreement acquired by such assignee
pursuant to such assignment and, if the assigning Lender has
retained an interest in such rights and obligations, new Notes to
the order of the assigning Lender in amounts corresponding to
such interests retained by it hereunder. Such new Notes shall be
in an aggregate principal amount equal to the aggregate principal
amount of the Notes to be replaced by such new Notes, shall be
dated the effective date of such assignment and shall otherwise
be in the form of the Notes to be replaced thereby. Such new
Notes shall be issued in substitution for, but not in
satisfaction or payment of, the Notes being replaced thereby. The
Agent shall bear the cost of preparation of such new Notes. Upon
the issuance of such new Notes, the term, "Notes," as used
herein, shall include all such new Notes issued pursuant to this
Section 12.11.
(b) Any Lender making an assignment under this Section
shall pay the Agent a transfer fee in the amount of $3,000
simultaneous with such assignment.
(c) Notwithstanding any other provision of this
Agreement, any Lender may at any time create a security interest
in all or any portion of its rights under this Agreement and that
Lender's Notes in favor of any Federal Reserve Bank in accordance
with Regulation A of the Board of Governors of the Federal
Reserve System.
(d) Except as set forth in this Section 12.11 and the
following Section 12.12, no Lender may assign any of its rights
or obligations under any Loan Document.
Section 12.12 Participations. In addition to the rights granted
--------------
in Section 12.11, each Lender may grant participations in a portion of its
Notes, Commitments and obligations under Section 2.3.1(b) to any institutional
investor, without the consent of the Borrower or the Agent, but only so long as
(except in the case of a participation granted to an affiliate of a Lender, in
which case the limitation and qualification set forth in clause (a) and (b)
below shall not apply):
(a) Within five (5) Bank Business Days after granting any
participation, such Lender gives the Agent and the Borrower notice
of such participation, including the name, address and telecopier
number of the participant and the amount of the Notes and Commitments
covered by the participation; and
(b) The principal amount of the participations so granted is no
less than $5,000,000.
No holder of any such participation, other than an affiliate of
such Lender, shall be entitled to require such Lender to take or omit to take
any action hereunder, except that such Lender may agree with such participant
that such Lender will not, without such participant's consent, (i) forgive any
indebtedness of the Borrower under this Agreement or the Notes, (ii) agree to
reduce the rate of interest charged under this Agreement, or (iii) agree to
extend the final maturity of any indebtedness evidenced by the Notes, except as
expressly provided by the terms of the Loan Documents. No Lender shall, as
between the Borrower and such Lender, be relieved of any of its obligations
hereunder as a result of any such granting of a participation. The Borrower
hereby acknowledges and agrees that any participant described in this Section
will, for purposes of Section 11.3, be considered to be a Lender hereunder
(provided that such participant shall not be entitled to receive any more than
the Lender selling such participation would have received had such sale not
taken place) and may rely on, and possess all rights under, any opinions,
certificates, or other instruments or documents delivered under or in connection
with any Loan Document. Except as set forth in this Section 12.12, no Lender may
grant any participation in any Loan Document or Commitment.
Section 12.13 Disclosure of Information. The Borrower authorizes
-------------------------
each Lender and the Agent to disclose to any participant, assignee or Additional
Lender (each, a "Transferee") and any prospective Transferee any and all
financial and other information in the possession of the Agent or any Lender
concerning the Borrower which has been delivered to the Agent or such Lender by
the Borrower pursuant to this Agreement or which has been delivered to the Agent
or such Lender by the Borrower in connection with the credit evaluation of the
Borrower by the Agent or such Lender prior to entering into this Agreement;
provided, however, that prior to disclosing such information to a Transferee or
- -------- -------
prospective Transferee, the applicable Lender shall obtain from such Transferee
or prospective Transferee a confidentiality agreement agreeing that such
information shall be used only in connection with such Person's evaluation and,
if applicable, administration of its interest in this Agreement and the loans
hereunder, and shall not be disclosed to any other Person, subject to exceptions
permitting disclosure to regulators and auditors, disclosure as required by law
or judicial process, and disclosure under such other limited circumstances as
that Lender and such Transferee or prospective Transferee may reasonably agree.
ARTICLE XIII.
MISCELLANEOUS
Section 13.1 No Waiver; Cumulative Remedies. No failure or delay
------------------------------
on the part of the Lenders in exercising any right, power or remedy under the
Loan Documents shall operate as a waiver thereof; nor shall any Lender's
acceptance of payments while any Default or Event of Default is outstanding
operate as a waiver of such Default or Event of Default, or any right, power or
remedy under the Loan Documents; nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy under the Loan Documents. The
remedies provided in the Loan Documents are cumulative and not exclusive of any
remedies provided by law.
Section 13.2 Amendments, Etc. No amendment, modification,
-----------------
termination or waiver of any provision of any Loan Document or consent to any
departure by the Borrower therefrom shall be effective unless the same shall be
in writing and signed by the Required Lenders (or, in the case of any action
described in Section 12.6, the number of Lenders specified for the applicable
action in such Section) and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given. No notice
to or demand on the Borrower in any case shall entitle the Borrower to any other
or further notice or demand in similar or other circumstances.
Section 13.3 Notice. Except as otherwise expressly provided
------
herein, all notices and other communications hereunder shall be in writing and
shall be (i) personally delivered, (ii) transmitted by registered mail, postage
prepaid, (iii) sent by Federal Express or similar expedited delivery service, or
(iv) transmitted by telecopy (followed, in the case of any notice from the Agent
or a Lender to the Borrower, pursuant to any of Sections 11.2(a), 11.2(b) or
11.3, by a notice transmitted by registered mail, postage prepaid), in each case
addressed to the party to whom notice is being given at its address as set forth
by its signature below, or, if telecopied, transmitted to that party at its
telecopier number set forth by its signature below; or, as to each party, at
such other address or telecopier number as may hereafter be designated in a
notice by that party to the other party complying with the terms of this
Section. All such notices or other communications shall be deemed to have been
given on (i) the date received if delivered personally, by mail, or by Federal
Express or similar expedited delivery service, or (ii) the date of transmission
if delivered by telecopy, except that notices or requests to the Agent or any
Lender pursuant to any of the provisions of Article II shall not be effective
until received.
Section 13.4 Costs and Expenses. The Borrower agrees to pay on
------------------
demand (i) all costs and expenses incurred by the Agent in connection with the
negotiation, preparation, execution, administration or amendment of the Loan
Documents and the other instruments and documents to be delivered hereunder and
thereunder, including the reasonable fees and out-of-pocket expenses of counsel
for the Agent with respect thereto, whether paid to outside counsel or allocated
by in-house counsel, and (ii) all costs and expenses incurred by the Agent or
any Lender in connection with the enforcement of the Loan Documents, including
the reasonable fees and out-of-pocket expenses of counsel for the Agent or any
Lender with respect thereto, whether paid to outside counsel or allocated by
in-house counsel.
Section 13.5 Indemnification by Borrower. The Borrower hereby
----------------------------
agrees to indemnify the Agent and the Lenders and each officer, director,
employee and agent thereof (herein individually each called an "Indemnitee" and
collectively called the "Indemnitees") from and against any and all losses,
claims, damages, reasonable expenses (including, without limitation, reasonable
attorneys' fees) and liabilities (all of the foregoing being herein called the
"Indemnified Liabilities") incurred by an Indemnitee in connection with or
arising out of the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the use of the proceeds of any Advance
(including but not limited to any such loss, claim, damage, expense or liability
arising out of any claim in which it is alleged that any "Environmental Law" has
been breached with respect to any activity or property of the Borrower), except
for any portion of such losses, claims, damages, expenses or liabilities
incurred solely as a result of the gross negligence or willful misconduct of the
applicable Indemnitee or the breach of this Agreement or any other Loan Document
by that Indemnitee. "Environmental Law" shall mean (i) any federal, state or
local law, statute, ordinance, rule, regulation, code, license, permit,
authorization, approval, consent, legal doctrine, order, directive, executive or
administrative order, judgment, decree, injunction, legal requirement or
agreement with any governmental entity relating to (A) the protection,
preservation or restoration of the environment (which includes, without
limitation, air, water vapor, surface water, groundwater, drinking water supply,
structures, soil, surface land, subsurface land, plant and animal life or any
other natural resource), or to human health or safety as it relates to hazardous
materials, or (B) the exposure to, or the use, storage, recycling, treatment,
generation, transportation, processing, handling, labeling, production, release
or disposal of, hazardous materials, in each case as amended and as now in
effect, including, without limitation, the Federal Comprehensive Environmental
Response, Compensation and Liability Act of 1980, the Superfund Amendments and
Reauthorization Act of 1986, the Federal Water Pollution Control Act of 1972,
the Federal Clean Air Act, the Federal Clean Water Act, the Federal Resource
Conservation and Recovery Act of 1976 (including, but not limited to, the
Hazardous and Solid Waste Amendments thereto and Subtitle I relating to
underground storage tanks), the Federal Solid Waste Disposal and the Federal
Toxic Substances Control Act, the Federal Insecticide, Fungicide and Rodenticide
Act, the Federal Occupational Safety and Health Act of 1970 as it relates to
hazardous materials, the Federal Hazardous Substances Transportation Act, the
Emergency Planning and Community Right-To-Know Act, the Safe Drinking Water Act,
the Endangered Species Act, the National Environmental Policy Act, the Rivers
and Harbors Appropriation Act or any so-called "Superfund" or "Superlien" law,
each as amended and as now or hereafter in effect, and (ii) any common law or
equitable doctrine (including, without limitation, injunctive relief and tort
doctrines such as negligence, nuisance, trespass and strict liability) that
imposes liability or obligations for injuries or damages due to, or threatened
as a result of the presence of or exposure to any hazardous material. If and to
the extent that the foregoing indemnity may be unenforceable for any reason, the
Borrower hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. All obligations provided for in this Section shall survive any
termination of this Agreement.
Section 13.6 Execution in Counterparts. This Agreement and the
--------------------------
other Loan Documents may be executed in any number of counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which counterparts of this Agreement or such other Loan Document, as the case
may be, taken together, shall constitute but one and the same instrument.
Section 13.7 Binding Effect, Assignment. The Loan Documents
----------------------------
shall be binding upon and inure to the benefit of the Borrower and the Lenders
and their respective successors and assigns, except that the Borrower shall not
have the right to assign its rights thereunder or any interest therein without
the prior written consent of each of the Lenders.
Section 13.8 Governing Law. The Loan Documents shall be governed
-------------
by, and construed in accordance with, the internal laws of the State of
Missouri.
Section 13.9 Consent to Jurisdiction/Jury Waiver. The Borrower
------------------------------------
and the Lenders each irrevocably (i) agree that any suit, action or other legal
proceeding arising out of or relating to this Agreement or any other Loan
Document may be brought in a court of record in Hennepin County in the State of
Minnesota or in the Courts of the United States located in such State, (ii)
consent to the jurisdiction of each such court in any suit, action or
proceeding, (iii) waive any objection which they may have to the laying of venue
of any such suit, action or proceeding in any such courts and any claim that any
such suit, action or proceeding has been brought in an inconvenient forum, and
(iv) agree that a final judgment in any such suit, action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. The Borrower and Lender each waives the
right to a trial by jury in any action based on or pertaining to this Agreement.
Section 13.10 Severability of Provisions. Any provision of this
---------------------------
Agreement which is prohibited or unenforceable shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof.
Section 13.11 Prior Agreements. This Agreement and the other Loan
----------------
Documents and related documents described herein restate and supersede in their
entirety any and all prior agreements and understandings, oral or written,
between any of the Lenders and the Borrower.
Section 13.12 Headings. Article and Section headings in this
--------
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
Section 13.13 No 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, REGARDLESS
OF LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED TO THIS
AGREEMENT. TO PROTECT YOU (BORROWER) AND US (LENDERS AND AGENT) 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 balance of this page is intentionally left blank.]
(Signature Page to Secured Credit Agreement Page 1 of 9)
3089976.10 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.
Address: FIRST BANKS, INC.
600 James S. McDonnell Blvd.
Mail Code M1-199-014
Hazelwood, Missouri 63042
Attention: Lisa K. Vansickle By /s/ Lisa K. Vansickle
Telecopier: (314) 592-6621 -------------------------------------
Its Senior Vice President and
Chief Financial Officer
(Signature Page to Secured Credit Agreement Page 1 of 9)
Address: WELLS FARGO BANK, NATIONAL
MAC N2790-142 ASSOCIATION, as Agent
100 South Hanley Road, Suite 1400
St. Louis, Missouri 63105
Attention: Catherine M. Morrissey
Telecopier: (314) 863-6815 By /s/ Catherine M. Morrissey
------------------------------------
Its Senior Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 2 of 9)
Address: WELLS FARGO BANK, NATIONAL
MAC N2790-142 ASSOCIATION, as both a Lender and
100 South Hanley Road, Suite 1400 as Swingline Lender
St. Louis, Missouri 63105
Attention: Catherine M. Morrissey
Telecopier: (314) 863-6815 By /s/ Catherine M. Morrissey
------------------------------------
Its Senior Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 3 of 9)
Address: JP MORGAN CHASE BANK, N.A.
Commercial Banking
JP Morgan Chase
IL1-1110
120 South LaSalle, 3rd Floor
Chicago, Illinois 60603
Attention: Kristin Paszcak
Telecopier: (312) 661-9511 By /s/ Kristin M. Paszcak
------------------------------------
Its Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 4 of 9)
Address: LASALLE BANK NATIONAL
SSOCIATION
One North Brentwood, Suite 950
Clayton, Missouri 63105
Attention: Robert J. Mathias By /s/ Robert J. Mathias
Telecopier: (314) 621-1612 ------------------------------------
Its Senior Banker
----------------------------------
(Signature Page to Secured Credit Agreement Page 5 of 9)
Address: THE NORTHERN TRUST
50 South LaSalle Street, L-09 COMPANY
Chicago, Illinois 60603
Attention: Lisa McDermott
Telecopier: (312) 444-4906 By /s/ Lisa McDermott
------------------------------------
Its Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 6 of 9)
Address: UNION BANK OF CALIFORNIA, N.A.
445 South Figureroa Street
Los Angeles, California 90071
Attention: Dennis A. Cattell
Telecopier: (213) 236-5548 By /s/ Dennis A. Cattell
------------------------------------
Its Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 7 of 9)
Address: FIFTH THIRD BANK (CHICAGO)
222 South Riverside Plaza, 33rd Floor
MD GRVR3B
Chicago, Illinois 60606
Attention: Peter Caligiuri
Telecopier: (312) 704-4115 By /s/ Peter Caligiuri
------------------------------------
Its Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 8 of 9)
Address: U.S. BANK NATIONAL ASSOCIATION
Correspondent Banking
One U.S. Bank Plaza
Mailcode: SL-MO-T11S
St. Louis, Missouri 63101
Attention: Jaycee D. Greene
Telecopier: (314) 418-2173 By /s/ Jaycee D. Greene
------------------------------------
Its Vice President
----------------------------------
(Signature Page to Secured Credit Agreement Page 9 of 9)
EXHIBIT 1.1 A
ADDITIONAL TERM NOTE
$ St. Louis, Missouri
---------------------
--------------, ------
For value received, the undersigned FIRST BANKS, INC., a Missouri
corporation (the "Borrower"), hereby promises to pay to the order of
_________________, a _____________ (the "Lender"), at the office of Wells Fargo
Bank, National Association, as agent (the "Agent") at Sixth Street and Marquette
Avenue, Minneapolis, Minnesota, or at any other place designated at any time in
accordance with the Credit Agreement (as hereinafter defined), in lawful money
of the United States of America and in immediately available funds, the
principal sum of _______________ Dollars ($______________) or, together with
interest on the principal amount hereunder remaining unpaid from time to time
(the "Principal Balance"), computed on the basis of the actual number of days
elapsed and a 360-day year, from the date hereof until this Note is fully paid.
The interest on this Note shall be determined, with reference to the
Secured Credit Agreement dated as of August 8, 2007 (as the same may be amended,
supplemented or restated from time to time) by and among the Borrower, the
Lenders from time to time party thereto and Wells Fargo Bank, National
Association, as Agent for the Lenders thereunder (the "Credit Agreement"), as
follows: (a) at the rate determined from time to time under the Credit
Agreement; except (b) as of the date of this Note, the following listed
Eurodollar Rates as applied to the listed portion(s) of the Principal Balance
and the date such interest rates expire; provided, however that, in determining
such Eurodollar Rate(s), the applicable Margin shall be determined in accordance
with Section 4.7 of the Credit Agreement:
Portion of the Date of Expiration of
Eurodollar Rate Principal Balance Eurodollar Rate
--------------- ----------------- ---------------
<________> $<_______> ________________, 20___
<________> $<_______> ________________, 20___
This Note may be prepaid only in accordance with the Credit Agreement.
The Principal Balance shall be payable in equal quarterly installments,
based on a four-year straight line amortization schedule, with the first such
installment due on the last day of the calendar quarter ending after the date
hereof and a final payment equal to the entire remaining principal balance (and
all accrued and unpaid interest and other sums due under the Credit Agreement in
respect of this Note) due on this Note's Additional Term Loan Maturity Date, as
defined in the Credit Agreement.
This Note is issued pursuant, and is subject, to the Credit Agreement.
This Note is an "Additional Term Note" referred to in the Credit Agreement.
This Note is secured, among other things, pursuant to the several security
agreements delivered pursuant to the Credit Agreement, and may now or hereafter
be secured by one or more other security agreements or other instruments or
agreements.
The Borrower hereby agrees to pay all costs of collection, including
reasonable attorneys' fees and legal expenses in the event this Note is not paid
when due, whether or not legal proceedings are commenced.
Presentment or other demand for payment, notice of dishonor and protest
are expressly waived.
BORROWER: FIRST BANKS, INC.
By ________________________________
Its _______________________________
EXHIBIT 1.1 B
BORROWER PLEDGE AGREEMENT
This Agreement is made as of the 8th day of August, 2007, by and between
FIRST BANKS, INC., a Missouri Corporation ("Debtor") and WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, as Agent for the "Lenders"
pursuant to the Secured Credit Agreement described below ("Secured Party").
RECITALS
Debtor, Secured Party and certain financial institutions have executed a
Secured Credit Agreement dated as of August 8, 2007, (the "Credit Agreement"),
pursuant to which such financial institutions (the "Lenders") have agreed to
lend up to $125,000,000 to Debtor (with Debtor having the right to increase the
credit facilities by an amount up to $25,000,000) and pursuant to which Secured
Party has agreed to issue up to $5,000,000 in face amount of standby letters of
credit for the account of Debtor.
One condition to the Lenders' and Secured Party's commitments under the
Credit Agreement is that Debtor execute, deliver and perform this Collateral
Pledge Agreement, thereby granting a security interest to Secured Party, as
agent for the Lenders, in the Collateral described herein.
Now, therefore, in consideration of the premises and the mutual agreements
herein set forth, the parties hereto hereby agree as follows:
1. Security Interest and Collateral. To secure the prompt and complete
payment and performance of the "Obligations," as such term is defined in the
Credit Agreement, Debtor hereby grants Secured Party (for its own account and as
agent for the Lenders) a security interest (the "Security Interest") in (i) all
of the capital stock of The San Francisco Company, a Delaware corporation, owned
by Debtor, (ii) any capital stock that Debtor may hereafter acquire and deliver
to Secured Party pursuant to Section 8.8 of the Credit Agreement, and (iii) all
proceeds of such capital stock and all other rights in connection with such
property (collectively the "Collateral").
2. Representations, Warranties and Covenants. Debtor represents, warrants
and covenants that:
(a) Debtor will join with Secured Party in taking any action
required by Secured Party in order to perfect the Security Interest and to
protect the rights and priorities of Secured Party with respect to the
Collateral. To that end, Debtor has delivered to Secured Party certificates
representing all of the shares of capital stock constituting Collateral and
executed and delivered one blank stock power for each such certificate.
Debtor will, at Secured Party's request at any one or more times (i) duly
endorse, in blank, each and every additional security certificate and
instrument constituting Collateral by signing on such certificate or
instrument or by signing a separate document of assignment or transfer and
deliver to Secured Party each and every such additional security
certificate and instrument; (ii) join with Secured Party in executing any
instructions or agreements with securities intermediaries for the purpose
of obtaining control of any investment property that may hereafter
constitute Collateral; and (iii) instruct the issuer of any security that
may hereafter constitute Collateral to register such security in the name
of Secured Party.
(b) Debtor is the owner of the Collateral free and clear of all
liens, encumbrances, security interests and restrictions except the
Security Interest and any restrictive legend appearing on any security
certificate or any instrument constituting Collateral.
(c) Debtor will keep the Collateral free and clear of all liens,
encumbrances and security interests, except the Security Interest.
(d) Debtor will pay, when due, all taxes and other governmental
charges levied or assessed upon or against any Collateral.
(e) Debtor will upon receipt deliver to Secured Party all investment
property distributed on account of Collateral, such as stock dividends and
securities resulting from stock splits, reorganizations and
recapitalizations. The Security Interest shall attach to all such proceeds.
3. Events of Default. The occurrence of any Event of Default under the
Credit Agreement shall be an Event of Default hereunder.
4. Remedies Upon Event of Default. Upon the occurrence of an Event of
Default and during the continuance thereof, Secured Party may exercise any one
or more of the rights and remedies specified in the Credit Agreement, and also
any one or more of the following rights or remedies: (i) notify the obligor on
or issuer of any Collateral or any securities intermediary to make payment to
Secured Party of any amounts due or distributable on any Collateral, (ii) in
Debtor's name or Secured Party's name enforce collection of any Collateral by
suit or otherwise, or surrender, release or exchange all or any part of it, or
compromise, extend or renew for any period any obligation evidenced by the
Collateral, (iii) receive and keep in its possession or under its control
subject to the Security Interest all proceeds of Collateral, except that any
money received from the Collateral may, at Secured Party's option, be applied in
reduction of the Obligations; (iv) exercise all voting and other rights as a
holder of any Collateral; (v) exercise and enforce any or all rights and
remedies available upon default to a secured party under the Uniform Commercial
Code, including the right to (A) order any securities intermediary to sell any
Collateral on any established market or over the counter or to cause any
Collateral to be redeemed; (B) give any transfer or redemption order to any
issuer of Collateral; or (C) offer and sell Collateral privately to purchasers
who will agree to take the Collateral for investment and not with a view to
distribution and who will agree to the imposition of restrictive legends on any
certificates representing Collateral, and the right to arrange for a sale which
would otherwise qualify as exempt from registration under the Securities Act of
1933; and if notice to Debtor of any intended disposition of Collateral or any
other intended action is required by law in a particular instance, such notice
shall be deemed commercially reasonable if given at least 10 calendar days prior
to the date of intended disposition or other action; and (vi) exercise or
enforce any or all other rights or remedies available to Secured Party by law or
agreement against any Collateral, against Debtor or against any other person or
property.
5. Secured Party's Duties. Secured Party's duty of care with respect to
Collateral in its possession (as imposed by law) shall be deemed fulfilled if
Secured Party exercises reasonable care in physically safekeeping such
Collateral, or in the case of Collateral in the custody or possession of a
securities intermediary or other third person, exercises reasonable care in the
selection of the securities intermediary or other third person and Secured Party
need not otherwise preserve, protect, insure or care for any Collateral. Secured
Party shall not be obligated to preserve any rights Debtor may have against
prior parties, to exercise at all or in any particular manner any voting rights
which may be available with respect to any Collateral, to realize on the
Collateral at all or in any particular manner or order, or to apply any cash
proceeds of Collateral in any particular order of application. Regardless of the
manner in which Secured Party chooses to exercise control over Collateral
(whether by possession, by agreement with an issuer or Securities Intermediary,
by transferring security entitlements into its own account, or otherwise),
Secured Party shall not be deemed to be under any obligation to Debtor, whether
as fiduciary, trustee, agent or otherwise, except the duty of good faith, the
duties specifically imposed upon Secured Party by this Agreement, and the duties
imposed upon it as a secured party by Articles 1, 8 and 9 of the Uniform
Commercial Code, as in effect in Missouri.
6. Miscellaneous. Any disposition of Collateral in the manner provided in
Section 4 shall be deemed commercially reasonable. This Agreement can be waived,
modified, amended, terminated or discharged, and the Security Interest can be
released, only explicitly in a writing signed by Secured Party. A waiver signed
by Secured Party shall be effective only in the specific instance and for the
specific purpose given. Mere delay or failure to act shall not preclude the
exercise or enforcement of any of Secured Party's rights or remedies. All rights
and remedies of Secured Party shall be cumulative and may be exercised
singularly or concurrently, at Secured Party's option, and the exercise or
enforcement of any one such right or remedy shall neither be a condition to nor
bar the exercise or enforcement of any other. All notices to be given to Debtor
shall be deemed sufficiently given if delivered or mailed by registered or
certified mail, postage prepaid, to Debtor at the address set forth following
its signature on the signature page of this Agreement or at the most recent
address shown on Secured Party's records. Debtor will reimburse Secured Party
for all expenses (including reasonable attorneys' fees and legal expenses)
incurred by Secured Party in the protection, defense or enforcement of the
Security Interest, including expenses incurred in any litigation or bankruptcy
or insolvency proceedings. This Agreement shall be binding upon and inure to the
benefit of Debtor and Secured Party and their successors and assigns and shall
take effect when signed by Debtor and delivered to Secured Party, and Debtor
waives notice of Secured Party's acceptance hereof. This Agreement shall be
governed by the internal laws of Missouri and, unless the context otherwise
requires, all terms used herein which are defined in Articles 1, 8 and 9 of the
Uniform Commercial Code, as in effect in Missouri, shall have the meanings
therein stated. If any provision or application of this Agreement is held
unlawful or unenforceable in any respect, such illegality or unenforceability
shall not affect other provisions or applications which can be given effect, and
this Agreement shall be construed as if the unlawful or unenforceable provision
or application had never been contained herein or prescribed hereby. All
representations and warranties contained in this Agreement shall survive the
execution, delivery and performance of this Agreement and the creation and
payment of the Obligations.
IN WITNESS WHEREOF, Debtor has executed this Agreement as of the day first
above written.
FIRST BANKS, INC.
By
------------------------------------------
Its
----------------------------------------
Address:
600 James S. McDonnell Blvd.
Mail Code M1-199-014
Hazelwood, MO 63042-2302
EXHIBIT 1.1 C
COMPLIANCE CERTIFICATE
This Compliance Certificate is being submitted on this ___ day of
__________________, 200__, for the quarter ending on the ___ day of
__________________, 200__, pursuant to the terms of the Secured Credit Agreement
dated as of August 8, 2007, (the "Credit Agreement"), as the same may be
thereafter amended from time to time, among Wells Fargo Bank, National
Association (the "Agent"), the Lenders that are parties thereto, and First
Banks, Inc., as Borrower. Capitalized terms used but not defined herein shall
have the meanings set forth in the Credit Agreement.
The undersigned officers of First Banks, Inc. jointly and severally certify
to the Lenders that as of the date hereof:
A. The representations and warranties contained in Article VII of the
Credit Agreement are correct as of the date hereof, except to the
extent that the same relate specifically to an earlier date;
B. No Default or Event of Default has occurred and is continuing;
C. Attached is an accurate listing of the current Subsidiaries of First
Banks, Inc.; and
D. The computation of Margin and L/C Margin and compliance with the
covenants contained in Article X of the Credit Agreement are supported
by the following:
4.7 Funded Debt Ratio
Revolving
(i) First Banks, Inc. (consolidated) (2) Ratio of Loan L/C Term Loan
Net Income for the quarter ended: Funded Debt (2) to (1) Margin Margin Margin
- --------------------------------- ----------- ---------- ------ ------ ------
$
- -------------- --------------
- -------------- --------------
- -------------- --------------
- -------------- --------------
Total Net Income $ (1) % bp bp bp
-------------- -------- ------- ------ ------ -----
10.1 Total Risk Based Capital Ratio
------------------------------
(2)
Weighted-Risk
Assets and Off- Minimum
(1) Balance Sheet Ratio of Ratio
Total Capital Items (1) to (2) Permitted
------------- ----- ---------- ---------
First Banks, Inc. (consolidated) % 10.0%
----------- --------- ---------- -----
First Bank % 10.0%
----------- --------- ---------- -----
10.2 Tier I Risk Based Capital Ratio
-------------------------------
(2)
Weighted-Risk
Assets and Off- Minimum
(1) Balance Sheet Ratio of Ratio
Tier I Capital Items (1) to (2) Permitted
-------------- ----- ---------- ---------
First Banks, Inc. (consolidated) % 6.0%
------------ --------- ---------- ----
First Bank % 6.0%
------------ --------- ---------- ----
10.3 Leverage Ratio
--------------
(1) (2) Ratio of Minimum
Tier I Capital Average Total (1) to (2) Ratio
-------------- ------------- ---------- Permitted
Assets ---------
------
First Banks, Inc. (consolidated) % 5.0%
------------ ----------- ---------- ----
First Bank % 5.0%
------------ ----------- ---------- ----
10.4 Minimum Return on Assets
------------------------
Minimum
Net Income for the quarter ended: Average Total Ratio of Ratio
- --------------------------------- Assets (2) (1) to (2) Permitted
----------- ---------- ---------
First Banks, Inc. (consolidated)
$
- -------------- ---------------
- -------------- ---------------
- -------------- ---------------
- -------------- ---------------
Total Net Income $ (1) % 0.70%
--------------- --------- ---------- -----
10.5 Non-Performing Assets
---------------------
(1) (2) Maximum
Non-Performing Primary Equity Ratio of Ratio
Assets Capital (1) to (2) Permitted
------ ------- ---------- ---------
First Banks, Inc. (consolidated) 20%
---------- --------- ---------- ---
10.6 Allowance for Loan and
-----------------------
Lease Losses
------------ (1)
Allowance for (2) Minimum
Loan and Non-Performing Ratio of Ratio
Lease Losses Assets (1) to (2) Permitted
------------ ------ ---------- ---------
First Banks, Inc. (consolidated) % 100%
---------- ---------- ---------- ----
Signed as of the day and year first above written.
FIRST BANKS, INC.
By:
---------------------------------------------------
Chief Executive Officer
By:
---------------------------------------------------
Senior Vice President and Chief Financial Officer
By:
---------------------------------------------------
Senior Vice President
By:
---------------------------------------------------
Chief Credit Officer
EXHIBIT 1.1 D
INITIAL TERM LOAN NOTE
$_________________ St. Louis, Missouri
August 8, 2007
For value received, the undersigned FIRST BANKS, INC., a Missouri
corporation (the "Borrower"), hereby promises to pay to the order of
_________________, a _____________ (the "Lender"), at the office of Wells Fargo
Bank, National Association, as agent (the "Agent") at Sixth Street and Marquette
Avenue, Minneapolis, Minnesota, or at any other place designated at any time in
accordance with the Credit Agreement (as hereinafter defined), in lawful money
of the United States of America and in immediately available funds, the
principal sum of _______________ Dollars ($______________) or, together with
interest on the principal amount hereunder remaining unpaid from time to time
(the "Principal Balance"), computed on the basis of the actual number of days
elapsed and a 360-day year, from the date hereof until this Note is fully paid
at the rate determined from time to time under the Secured Credit Agreement of
even date herewith (as the same may be amended, supplemented or restated from
time to time) by and among the Borrower, the Lenders from time to time party
thereto and Wells Fargo Bank, National Association, as Agent for the Lenders
thereunder (the "Credit Agreement"). This Note may be prepaid only in accordance
with the Credit Agreement.
The Principal Balance shall be repaid in seven (7) equal calendar quarterly
installments, beginning September 30, 2007, equal to _______________ Dollars
($______________), with a final payment equal to the entire remaining principal
balance (and all accrued and unpaid interest and other sums due under the Credit
Agreement in respect of this Note) due on this Note's Initial Term Loan Maturity
Date, as defined in the Credit Agreement.
This Note is issued pursuant, and is subject, to the Credit Agreement. This
Note is an "Initial Term Loan Note" referred to in the Credit Agreement.
This Note is secured, among other things, pursuant to the several security
agreements delivered pursuant to the Credit Agreement, and may now or hereafter
be secured by one or more other security agreements or other instruments or
agreements.
The Borrower hereby agrees to pay all costs of collection, including
reasonable attorneys' fees and legal expenses in the event this Note is not paid
when due, whether or not legal proceedings are commenced.
Presentment or other demand for payment, notice of dishonor and protest are
expressly waived.
BORROWER: FIRST BANKS, INC.
By ________________________________
Its _______________________________
EXHIBIT 1.1 E1
APPLICATION FOR STANDBY LETTER OF CREDIT
TO: WELLS FARGO BANK, NATIONAL ASSOCIATION
- ------------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
DATE FOR WELLS FARGO'S LETTER OF DOCUMENT
USE ONLY CREDIT NO. TRACK NO.
------------------------------------------------------------------------------------------------------------------------------
APPLICANT SIGNING BELOW HEREBY REQUESTS THAT WELLS FARGO BANK, NATIONAL ASSOCIATION ("WELLS FARGO") ISSUE IN WELLS FARGO'S NAME AN
IRREVOCABLE STANDBY LETTER OF CREDIT (THE "CREDIT") ON SUBSTANTIALLY THE TERMS BELOW AND, UNLESS OTHERWISE SPECIFIED BELOW IN
SPECIAL INSTRUCTIONS, FORWARD THE CREDIT BY THE FOLLOWING MEANS TO THE BENEFICIARY DIRECTLY OR THROUGH A BANK SELECTED BY WELLS
FARGO:
|_| FULL CABLE/TELEX |_| COURIER |_| MAIL WITH BRIEF ADVICE BY CABLE/TELEX |_| MAIL |_| OTHER:____________
- ------------------------------------------------------------------------------------------------------------------------------------
ADVISING BANK: (If left blank, Wells Fargo may select) BENEFICIARY: (Name and Address)
- ------------------------------------------------------------------------------------------------------------------------------------
PARTY TO BE NAMED AS REQUESTING THE CREDIT: (Name and Address) AMOUNT: (In words)
-------------------------------- ---------------------------
(In figures) (Currency)
- ------------------------------------------------------------------------------------------------------------------------------------
AVAILABILITY: Unless otherwise specified herein, the Credit is to EXPIRATION DATE:________________________________________
be available with Wells Fargo's issuing office by payment of
draft(s)drawn at sight on Wells Fargo or, at Wells Fargo's option, PLACE OF EXPIRATION: Unless otherwise specified herein,
with any bank(s) or with a bank nominated by Well s Fargo by the Credit is to expire at Wells Fargo's issuing office or,
negotiation of drafts(s)drawn at sight on Wells Fargo. if the Credit is available with any bank(s) or with a
specific bank other than Wells Fargo's issuing office, at
such place as Wells Fargo shall elect.
- ------------------------------------------------------------------------------------------------------------------------------------
DOCUMENT(S): Draft(s) are to be accompanied by: (Attached additional signed sheet(s), if necessary, and label as attachments to this
Application.)
- ------------------------------------------------------------------------------------------------------------------------------------
DRAWING(S): |_| Partial drawings are permitted. (More than one draft may be drawn and presented under the Credit.)
|_| Only one draft may be drawn and presented under the Credit, and:
|_| the draft must be for the full amount of the Credit. |_| the draft may be for less than the full amount of
the Credit.
- ------------------------------------------------------------------------------------------------------------------------------------
SPECIAL INSTRUCTIONS: (Attach additional signed sheet(s), if necessary, and label as attachments to this Application.)
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
TRANSFERABILITY: (If not checked, the Credit will not be transferable.)
|_| The Credit is to be transferable, with transfer charges for: |_| Applicant's account |_| Beneficiary's account
- ------------------------------------------------------------------------------------------------------------------------------------
INQUIRIES: Direct to: Telephone Number:
- ------------------------------------------------------------------------------------------------------------------------------------
APPLICANT'S AGREEMENT AND SIGNATURE: Applicant's signature here indicatesagreement to all the terms and conditions on this
Application and Applicant's agreement that the Credit and its issuance will be governed by (1) the terms and conditions of the
Standby Letter of Credit Agreement between Applicant and Wells Fargo and/or (2) any other agreement signed by Applicant pursuant to
which the Credit is to be issued. This Application is signed by Applicant's duly authorized representative(s) on the date specified
above.
- ------------------------------------------------------------------------------ ------------------------------------------------
APPLICANT ADDRESS
- -------------------------------------------------- -------------------------- ------------------------------------------------
AUTHORIZED SIGNATURE TITLE ADDRESS
- -------------------------------------------------- -------------------------- ------------------------------------------------
AUTHORIZED SIGNATURE TITLE ADDRESS
- ----------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
(TO BE COMPLETED BY WELLS FARGO BANK, NATIONAL ASSOCIATION)
CREDIT ISSUANCE HAS BEEN APPROVED IN ACCORDANCE WITH WELLS FARGO'S CREDIT POLICIES AND PROCEDURES
- ------------------------------------------------------------------------------------------------------------------------------------
APPROVING OFFICER'S SIGNATURE APPROVING OFFICER'S NAME (Print) APPROVING OFFICER'S OFFICE (Print) AU MAC COMMITMENT NO.
- -----------------------------------------------------------------------------------------------------------------------------------
PHONE AFS INTERFACE STANDALONE COLLATERAL PURPOSE DATE
REQUIRED: TRANSACTION: CODE CODE
YES |_| NO |_| YES |_| NO |_|
- ------------------------------------------------------------------------------------------------------------------------------------
SPECIAL INSTRUCTIONS: (Indicate any provisions applicable to the Credit different from those on Applicant's Relationship Management
Instructions Form)
- ------------------------------------------------------------------------------------------------------------------------------------
EXHIBIT 1.1 E2
STANDBY LETTER OF CREDIT AGREEMENT
To: WELLS FARGO BANK, NATIONAL ASSOCIATION
Applicant hereby requests that you, Wells Fargo Bank, National
Association ("Wells Fargo"), issue in your name one or more standby letters of
credit pursuant to Applications for the issuance of such Credits and the terms
and conditions of this Agreement. Each Credit will be issued at Applicant's
request and for its account, and, unless otherwise specifically provided in any
Loan Document, at your option. Applicant agrees that the terms and conditions in
this Agreement shall apply to each Application and the Credit issued pursuant to
each Application, and to transactions under each Application, each Credit and
this Agreement.
SECTION 1. DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings set forth after each term: "Agreement" means this
---------
Standby Letter of Credit Agreement as it may be revised or amended from time to
time. "Applicant" means collectively each person and/or entity signing this
---------
Agreement as Applicant. "Application" means your printed form titled
-----------
"Application For Standby Letter of Credit" or any other form acceptable to you
on which Applicant applies for the issuance by you of a Credit and/or an
application for amendment of a Credit or any combination of such applications,
as the context may require. "Beneficiary" means the person or entity named on an
-----------
Application as the beneficiary or any transferee of such beneficiary.
"Collateral" means the Property, together with the proceeds of such Property,
----------
securing any or all of Applicant's obligations and liabilities at any time
existing under or in connection with any L/C Document and/or any Loan Document.
"Commission Fee" means the fee, computed at the commission fee rate specified by
--------------
you or specified in any Loan Document, charged by you at the time or times
specified by you on the amount of each Credit and on the amount of each increase
in a Credit for the time period each Credit is outstanding. "Credit" means an
------
instrument or document titled "Irrevocable Standby Letter of Credit" or "Standby
Letter of Credit", or any instrument or document whatever it is titled or
whether or not it is titled functioning as a standby letter of credit, issued
under or pursuant to an Application, and all renewals, extensions and amendments
of such instrument or document. "Demand" means any sight draft, electronic or
------
telegraphic transmission or other written demand drawn or made, or purported to
be drawn or made, under or in connection with any Credit. "Document" means any
--------
instrument, statement, certificate or other document referred to in or related
to any Credit or required by any Credit to be presented with any Demand.
"Dollars" means the lawful currency at any time for the payment of public or
-------
private debts in the United States of America. "Event of Default" means any of
----------------
the events set forth in Section 13 of this Agreement. "Expiration Date" means
----------------
the date any Credit expires. "Guarantor" means any person or entity guaranteeing
---------
the payment and/or performance of any or all of Applicant's obligations under or
in connection with any L/C Document and/or any Loan Document. "Holding Company"
---------------
means any company or other entity directly or indirectly controlling you. "L/C
---
Document" means this Agreement, each Application, each Credit, and each Demand.
- --------
"Loan Document" means each and any promissory note, loan agreement, security
--------------
agreement, pledge agreement, guarantee or other agreement or document executed
in connection with, or relating to, any extension of credit under which any
Credit is issued. "Maximum Rate" means the maximum amount of interest (as
-------------
defined by applicable laws), if any, permitted to be paid, taken, reserved,
received, collected or charged under applicable laws, as the same may be amended
or modified from time to time. "Negotiation Fee" means the fee, computed at the
---------------
negotiation fee rate specified by you or specified in any Loan Document, charged
by you on the amount of each Demand paid by you or any other bank specified by
you when each Demand is paid. "Payment Office" means the office specified by you
--------------
or specified in any Loan Document as the office where reimbursements and other
payments under or in connection with any L/C Document are to be made by
Applicant. "Prime Rate" means the rate of interest most recently announced
-----------
within Wells Fargo at its principal office as its Prime Rate, with the
understanding that the Prime Rate is one of Wells Fargo's base rates and serves
as the basis upon which effective rates of interest are calculated for those
loans making reference thereto, and is evidenced by the recording thereof after
its announcement in such internal publication or publications as Wells Fargo may
designate. "Property" means all forms of property, whether tangible or
--------
intangible, real, personal or mixed. "Rate of Exchange" means Wells Fargo's then
----------------
current selling rate of exchange in San Francisco, California for sales of the
currency of payment of any Demand, or of any fees or expenses or other amounts
payable under this Agreement, for cable transfer to the country of which such
currency is the legal tender. "UCP" means the Uniform Customs and Practice for
---
Documentary Credits, an International Chamber of Commerce publication, or any
substitution therefor or replacement thereof. "Unpaid and Undrawn Balance" means
--------------------------
at any time the entire amount which has not been paid by you under all the
Credits issued for Applicant's account, including, without limitation, the
amount of each Demand on which you have not yet effected payment as well as the
amount undrawn under all such Credits. "Wells Fargo & Company" means Wells Fargo
---------------------
& Company, a Delaware corporation.
SECTION 2. HONORING DEMANDS AND DOCUMENTS. You may receive, accept and
honor, as complying with the terms of any Credit, any Demand and any Documents
accompanying such Demand, provided that such Demand and accompanying Documents
appear on their face to comply substantially with the provisions of such Credit
and are, or appear on their face to be, signed or issued by (a) a person or
entity authorized under such Credit to draw, sign or issue such Demand and
accompanying Documents, or (b) an administrator, executor, trustee in
bankruptcy, debtor in possession, assignee for the benefit of creditors,
liquidator, receiver or other legal representative or successor in interest by
operation of law of any such person or entity.
SECTION 3. REIMBURSEMENT FOR PAYMENT OF DEMANDS. Applicant shall
reimburse you for all amounts paid by you on each Demand, including, without
limitation, all such amounts paid by you to any paying, negotiating or other
bank. If in connection with the issuance of any Credit, you agree to pay any
other bank the amount of any payment or negotiation made by such other bank
under such Credit upon your receipt of a cable, telex or other written
telecommunication advising you of such payment or negotiation, or authorize any
other bank to debit your account for the amount of such payment or negotiation,
Applicant agrees to reimburse you for all such amounts paid by you, or debited
to your account with such other bank, even if any Demand or Document specified
in such Credit fails to arrive in whole or in part or if, upon the arrival of
any such Demand or Document, the terms of such Credit have not been complied
with or such Demand or Document does not conform to the requirements of such
Credit or is not otherwise in order.
SECTION 4. FEES AND EXPENSES. Applicant agrees to pay to you (a) all
Commission Fees, Negotiation Fees, cable fees, amendment fees, non-usance fees,
and cancellation fees of, and all out-of-pocket expenses incurred by, you under
or in connection with any L/C Document, and (b) all fees and charges of banks or
other entities other than you under or in connection with any L/C Document if
any Application (i) does not indicate who will pay such fees and charges, (ii)
indicates that such fees and charges are to be paid by Applicant, or (iii)
indicates that such fees and charges are to be paid by the Beneficiary and the
Beneficiary does not, for any reason whatsoever, pay such fees or charges. There
shall be no refund of any portion of any Commission Fee in the event any Credit
is used, reduced, amended, modified or terminated before its Expiration Date.
SECTION 5. DEFAULT INTEREST. Unless otherwise specified in any Loan
Document, or on an Application and agreed to by you, all amounts to be
reimbursed by Applicant to you, and all fees and expenses to be paid by
Applicant to you, and all other amounts due from Applicant to you under or in
connection with any L/C Documents, will bear interest (to the extent permitted
by law), payable on demand, from the date you paid the amounts to be reimbursed
or the date such fees, expenses and other amounts were due until such amounts
are paid in full, at a rate per annum (computed on the basis of a 360-day year,
actual days elapsed) which is the lesser of (a) two percent (2%) above the Prime
Rate in effect from time to time, or (b) the Maximum Rate.
SECTION 6. TIME AND METHOD OF REIMBURSEMENT AND PAYMENT. Unless otherwise
specified in this Section, in any Loan Document, or on an Application and agreed
to by you, all amounts to be reimbursed by Applicant to you, all fees and
expenses to be paid by Applicant to you, and all interest and other amounts due
to you from Applicant under or in connection with any L/C Documents will be
reimbursed or paid at the Payment Office in Dollars in immediately available
funds without setoff or counterclaim (i) on demand or, (ii) at your option by
your debiting any of Applicant's accounts with you, with each such debit being
made without presentment, protest, demand for reimbursement or payment, notice
of dishonor or any other notice whatsoever, all of which are hereby expressly
waived by Applicant. Each such debit will be made at the time each Demand is
paid by you or, if earlier, at the time each amount is paid by you to any
paying, negotiating or other bank, or at the time each fee and expense is to be
paid or any interest or other amount is due under or in connection with any L/C
Documents. If any Demand or any fee, expense, interest or other amount payable
under or in connection with any L/C Documents is payable in a currency other
than Dollars, Applicant agrees to reimburse you for all amounts paid by you on
such Demand, and/or to pay you all such fees, expenses, interest and other
amounts, in one of the three following ways, as determined by you in your sole
discretion in each case: (a) at such place as you shall direct, in such other
currency; or (b) at the Payment Office in the Dollar equivalent of the amount of
such other currency calculated at the Rate of Exchange on the date determined by
you in your sole discretion; or (c) at the Payment Office in the Dollar
equivalent, as determined by you (which determination shall be deemed correct
absent manifest error), of such fees, expenses, interest or other amounts or of
the actual cost to you of paying such Demand. Applicant assumes all political,
economic and other risks of disruptions or interruptions in any currency
exchange.
SECTION 7. AGREEMENTS OF APPLICANT. Applicant agrees that (a) unless
otherwise specifically provided in any Loan Document, you shall not be obligated
at any time to issue any Credit for Applicant's account; (b) unless otherwise
specifically provided in any Loan Document, if any Credit is issued by you for
Applicant's account, you shall not be obligated to issue any further Credit for
Applicant's account or to make other extensions of credit to Applicant or in any
other manner to extend any financial consideration to Applicant; (c) you have
not given Applicant any legal or other advice with regard to any L/C Document or
Loan Document; (d) if you at any time discuss with Applicant the wording for any
Credit, any such discussion will not constitute legal or other advice by you or
any representation or warranty by you that any wording or Credit will satisfy
Applicant's needs; (e) Applicant is responsible for the wording of each Credit,
including, without limitation, any drawing conditions, and will not rely on you
in any way in connection with the wording of any Credit or the structuring of
any transaction related to any Credit; (f) Applicant, and not you, is
responsible for entering into the contracts relating to the Credits between
Applicant and the Beneficiaries and for causing Credits to be issued; (g) you
may, as you deem appropriate, modify or alter and use in any Credit the
terminology contained on the Application for such Credit; (h) unless the
Application for a Credit specifies whether the Documents to be presented with a
Demand under such Credit must be sent to you in one parcel or in two parcels or
may be sent to you in any number of parcels, you may, if you so desire, make
such determination and specify in the Credit whether such Documents must be sent
in one parcel or two parcels or may be sent in any number of parcels; (i) you
shall not be deemed Applicant's agent or the agent of any Beneficiary or any
other user of any Credit, and neither Applicant, nor any Beneficiary nor any
other user of any Credit shall be deemed your agent; (j) Applicant will promptly
examine all Documents and each Credit if and when they are delivered to
Applicant and, in the event of any claim of noncompliance of any Documents or
any Credit with Applicant's instructions or any Application, or in the event of
any other irregularity, Applicant will promptly notify you in writing of such
noncompliance or irregularity; (k) all directions and correspondence relating to
any L/C Document are to be sent at Applicant's risk; (l) if any Credit has a
provision concerning the automatic extension of its Expiration Date, you may, at
your sole option, give notice of nonrenewal of such Credit and if Applicant does
not at any time want such Credit to be renewed Applicant will so notify you at
least fifteen (15) calendar days before you are to notify the Beneficiary of
such Credit or any advising bank of such nonrenewal pursuant to the terms of
such Credit; (m) Applicant will not seek to obtain, apply for, or acquiesce in
any temporary or permanent restraining order, preliminary or permanent
injunction, permanent injunction or any other pretrial or permanent injunctive
or similar relief, restraining, prohibiting or enjoining you, any of your
correspondents or any advising, confirming, negotiating, paying or other bank
from paying or negotiating any Demand or honoring any other obligation under or
in connection with any Credit; and (n) except for Applicant's obligations
specifically affected by the actions referred to in subsection (vi) of this
Section 7(n), Applicant's obligations under or in connection with each L/C
Document and Loan Document shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of each such L/C
Document and Loan Document under all circumstances whatsoever, including,
without limitation, the following circumstances, the circumstances listed in
Section 12(b) through (dd) of this Agreement, and any other event or
circumstance similar to such circumstances: (A) any lack of validity or
enforceability of any L/C Document, any Loan Document, any Document or any
agreement relating to any of the foregoing; (B) any amendment of or waiver
relating to, or any consent to or departure from, any L/C Document, any Loan
Document or any Document; (C) any release or substitution at any time of any
Property held as Collateral; (D) your failure to deliver to Applicant any
Document you have received with a drawing under a Credit because doing so would,
or is likely to, violate any law, rule or regulation of any government
authority; (E) the existence of any claim, set-off, defense or other right which
Applicant may have at any time against you or any Beneficiary (or any person or
entity for whom any Beneficiary may be acting) or any other person or entity,
whether under or in connection with any L/C Document, any Loan Document, any
Document or any Property referred to in or related to any of the foregoing or
under or in connection with any unrelated transaction; (F) any breach of
contract or other dispute between or among any two or more of you, Applicant,
any Beneficiary, any transferee of any Beneficiary, any person or entity for
whom any Beneficiary or any transferee of any Beneficiary may be acting, or any
other person or entity; or (G) any delay, extension of time, renewal, compromise
or other indulgence granted or agreed to by you with or without notice to
Applicant, or Applicant's approval, in respect of any of Applicant's
indebtedness or other obligations to you under or in connection with any L/C
Document or any Loan Document.
SECTION 8. COMPLIANCE WITH LAWS AND REGULATIONS. Applicant represents and
warrants to you that no Application, Credit or transaction under any Application
and/or Credit will contravene any law or regulation of the government of the
United States or any state thereof. Applicant agrees (a) to comply with all
federal, state and foreign exchange regulations and other government laws and
regulations now or hereafter applicable to any L/C Document, to any payments
under or in connection with any L/C Document, to each transaction under or in
connection with any L/C Document, or to the import, export, shipping or
financing of the Property referred to in or shipped under or in connection with
any Credit, and (b) to reimburse you for such amounts as you may be required to
expend as a result of such laws or regulations, or any change therein or in the
interpretation thereof by any court or administrative or government authority
charged with the administration of such laws or regulations.
SECTION 9. TAXES, RESERVES AND CAPITAL ADEQUACY REQUIREMENTS. In addition
to, and notwithstanding any other provision of any L/C Document or any Loan
Document, in the event that any law, treaty, rule, regulation, guideline,
request, order, directive or determination (whether or not having the force of
law) of or from any government authority, including, without limitation, any
court, central bank or government regulatory authority, or any change therein or
in the interpretation or application thereof, (a) does or shall subject you to
any tax of any kind whatsoever with respect to the L/C Documents, or change the
basis of taxation of payments to you of any amount payable thereunder (except
for changes in the rate of tax on your net income); (b) does or shall impose,
modify or hold applicable any reserve, special deposit, assessment, compulsory
loan, Federal Deposit Insurance Corporation insurance or similar requirement
against assets held by, deposits or other liabilities in or for the account of,
advances or loans by, other credit extended by or any other acquisition of funds
by, any of your offices; (c) does or shall impose, modify or hold applicable any
capital adequacy requirements (whether or not having the force of law); or (d)
does or shall impose on you any other condition; and the result of any of the
foregoing is (i) to increase the cost to you of issuing or maintaining any
Credit or of performing any transaction under any L/C Document, (ii) to reduce
any amount receivable by you under any L/C Document, or (iii) to reduce the rate
of return on your capital or the capital of the Holding Company to a level below
that which you or the Holding Company could have achieved but for any
imposition, modification or application of any capital adequacy requirement
(taking into consideration your policy and the policy of the Holding Company, as
the case may be, with respect to capital adequacy), and any such increase or
reduction is material (as determined by you or the Holding Company, as the case
may be, in your or the Holding Company's sole discretion); then, in any such
case, Applicant agrees to pay to you or the Holding Company, as the case may be,
such amount or amounts as may be necessary to compensate you or the Holding
Company for (A) any such additional cost, (B) any reduction in the amount
received by you under any L/C Document, or (C) to the extent allocable (as
determined by you or the Holding Company, as the case may be, in your or the
Holding Company's sole discretion) to any L/C Document, any reduction in the
rate of return on your capital or the capital of the Holding Company.
SECTION 10. COLLATERAL. In addition to, and not in substitution for, any
Property delivered, conveyed, transferred or assigned to you under any Loan
Document as security for any or all of Applicant's obligations and liabilities
to you at any time existing under or in connection with any L/C Document or any
Loan Document, Applicant grants to you a security interest in and to the
following Collateral, whether or not any such Collateral is in your possession
or control or the possession or control of your agents or correspondents or in
transit to, or set apart for, you or your agents or correspondents, until such
time as all Applicant's obligations and liabilities to you at any time existing
under or in connection with each L/C Document and each Loan Document have been
fully paid and discharged, all as security for such obligations and liabilities,
(a) all Applicant's property, claims, demands, right, title and interest in and
to the balance of each of Applicant's deposit accounts with you now or at any
time hereafter existing, and all evidences of such deposit accounts, (b) all
Property belonging to Applicant or in which it may have an interest, now or at
any time hereafter delivered, conveyed, transferred, assigned, pledged or paid
to you or your agents or correspondents in any manner whatsoever, whether as
security or for safekeeping or otherwise, including, without limitation, any
items received for collection or transmission, and the proceeds of such items,
whether or not such Property is in whole or in part released to Applicant on
trust or bailee receipt or otherwise, and (c) where Applicant is more than one
person or entity, all right, title and interest of each of Applicants in and to
all the Property which any of Applicants may now or hereafter obtain as security
for the obligations of any one or more of Applicants to one or more of the
others of Applicants arising under or in connection with the transaction to
which any Credit relates. Further, in addition to, and not in substitution for,
any Property delivered, conveyed, transferred or assigned to you under any Loan
Document as security for any or all of Applicant's obligations and liabilities
to you at any time existing under or in connection with any L/C Document or any
Loan Document, Applicant agrees to deliver, convey, transfer and assign to you
on demand, as security, Property of a value and character satisfactory to you,
(i) if you at any time feel insecure about Applicant's ability or willingness to
repay any amounts which you have paid or may pay in the future on any Demand or
in honoring any other of your obligations under or in connection with any
Credit, or (ii) without limiting the generality of the foregoing, if any
temporary or permanent restraining order, preliminary or permanent injunction,
or any other pretrial or permanent injunctive or similar relief is obtained
restraining, prohibiting or enjoining you, any of your correspondents, or any
advising, confirming, negotiating, paying or other bank from paying or
negotiating any Demand or honoring any other obligation under or in connection
with any Credit. Applicant agrees that the receipt by you or any of your agents
or correspondents at any time of any kind of security, including, without
limitation, cash, shall not be deemed a waiver of any of your rights or powers
under this Agreement. Applicant agrees to sign and deliver to you on demand, all
such deeds of trust, security agreements, financing statements and other
documents as you shall at any time request which are necessary or desirable (in
your sole opinion) to grant to you an effective and perfected security interest
in and to any or all of the Collateral. Applicant agrees to pay all filing and
recording fees related to the perfection of any security interest granted to you
in accordance with this Section. Applicant hereby agrees that any or all of the
Collateral may be held and disposed of as provided in this Agreement by you.
Upon any transfer, sale, delivery, surrender or endorsement of any Document or
Property which is or was part of the Collateral, Applicant will indemnify and
hold you and your agents and correspondents harmless from and against each and
every claim, demand, action or suit which may arise against you or any of your
agents or correspondents by reason of such transfer, sale, delivery, surrender
or endorsement.
SECTION 11. INDEMNIFICATION. Except to the extent caused by your lack of
good faith, and notwithstanding any other provision of this Agreement, Applicant
agrees to reimburse and indemnify you for (a) all amounts paid by you to any
Beneficiary under or in connection with any guarantee or similar undertaking
issued by such Beneficiary to a third party at Applicant's request, whether such
request is communicated directly by Applicant or through you to such
Beneficiary; and (b) all damages, losses, liabilities, actions, claims, suits,
penalties, judgments, obligations, costs or expenses, of any kind whatsoever and
howsoever caused, including, without limitation, attorneys' fees and interest,
paid, suffered or incurred by, or imposed upon, you directly or indirectly
arising out of or in connection with (i) any L/C Document, any Loan Document,
any Document or any Property referred to in or related to any Credit; (ii)
Applicant's failure to comply with any of its obligations under this Agreement;
(iii) the issuance of any Credit; (iv) the transfer of any Credit; (v) any
guarantee or similar undertaking, or any transactions thereunder, issued by any
Beneficiary to a third party at Applicant's request, whether such request is
communicated directly by Applicant or through you to such Beneficiary; (vi) any
communication made by you, on Applicant's instructions, to any Beneficiary
requesting that such Beneficiary issue a guarantee or similar undertaking to a
third party or the issuance of any such guarantee or similar undertaking; (vii)
the collection of any amounts Applicant owes to you under or in connection with
any L/C Document or any Loan Document; (viii) the foreclosure against, or other
enforcement of, any Collateral; (ix) the protection, exercise or enforcement of
your rights and remedies under or in connection with any L/C Document or any
Loan Document; (x) any court decrees or orders, including, without limitation,
temporary or permanent restraining orders, preliminary or permanent injunctions,
or any other pretrial or permanent injunctive or similar relief, restraining,
prohibiting or enjoining or seeking to restrain, prohibit or enjoin you, any of
your correspondents or any advising, confirming, negotiating, paying or other
bank from paying or negotiating any Demand or honoring any other obligation
under or in connection with any Credit; or (xi) any Credit being governed by
laws or rules other than the UCP in effect on the date such Credit is issued.
The indemnity provided in this Section will survive the termination of this
Agreement and the expiration or cancellation of any or all the Credits.
SECTION 12. LIMITATION OF LIABILITY. Notwithstanding any other provision
of this Agreement, neither you nor any of your agents or correspondents will
have any liability to Applicant for any action, neglect or omission, if done in
good faith, under or in connection with any L/C Document, Loan Document or
Credit, including, without limitation, the issuance or any amendment of any
Credit, the failure to issue or amend any Credit, or the honoring or dishonoring
of any Demand under any Credit, and such good faith action, neglect or omission
will bind Applicant. Notwithstanding any other provision of any L/C Document, in
no event shall you or your officers or directors be liable or responsible,
regardless of whether any claim is based on contract or tort, for (a) any
special, consequential, indirect or incidental damages, including, without
limitation, lost profits, arising out of or in connection with the issuance of
any Credit or any action taken or not taken by you in connection with any L/C
Document, any Loan Document, or any Document or Property referred to in or
related to any Credit; (b) the honoring of any Demand in accordance with any
order or directive of any court or government or regulatory body or entity
requiring such honor despite any temporary restraining order, restraining order,
preliminary injunction, permanent injunction or any type of pretrial or
permanent injunctive relief or any similar relief, however named, restraining,
prohibiting or enjoining such honor; (c) the dishonoring of any Demand in
accordance with any legal or other restriction in force at the time and in the
place of presentment or payment; (d) verifying the existence or reasonableness
of any act or condition referenced, or any statement made, in connection with
any drawing or presentment under any Credit; (e) the use which may be made of
any Credit; (f) the validity of any purported transfer of any Credit or the
identity of any purported transferee of any Beneficiary; (g) any acts or
omissions of any Beneficiary or any other user of any Credit; (h) the form,
validity, sufficiency, correctness, genuineness or legal effect of any Demand or
any Document, or of any signatures or endorsements on any Demand or Document,
even if any Demand or any Document should in fact prove to be in any or all
respects invalid, insufficient, fraudulent or forged; (i) payment by you of any
Demand when the Demand and any accompanying Documents appear on their face to
comply substantially with the terms of the Credit to which they relate or
dishonor by you of any Demand when the Demand and any accompanying Documents do
not strictly comply on their face with the terms of the Credit to which they
relate; (j) the failure of any Demand or Document to bear any reference or
adequate reference to the Credit to which it relates; (k) the failure of any
Document to accompany any Demand; (l) the failure of any person or entity to
note the amount of any Demand on the Credit to which it relates or on any
Document; (m) the failure of any person or entity to surrender or take up any
Credit; (n) the failure of any Beneficiary to comply with the terms of any
Credit or to meet the obligations of such Beneficiary to Applicant; (o) the
failure of any person or entity to send or forward Documents if and as required
by the terms of any Credit; (p) any errors, inaccuracies, omissions,
interruptions or delays in transmission or delivery of any messages, directions
or correspondence by mail, cable, telegraph, wireless or otherwise, whether or
not they are in cipher; (q) any notice of nonrenewal of a Credit sent by you not
being received on time or at any time by the Beneficiary of such Credit; (r) any
inaccuracies in the translation of any messages, directions or correspondence;
(s) any Beneficiary's use of the proceeds of any Demand; (t) any Beneficiary's
failure to repay to you or Applicant the proceeds of any Demand if the terms of
any Credit require such repayment; or (u) any act, error, neglect, default,
negligence, gross negligence, omission, willful misconduct, lack of good faith,
insolvency or failure in business of any of your agents or correspondents or of
any advising, confirming, negotiating, paying or other bank. The occurrence of
any one or more of the contingencies referred to in the preceding sentence shall
not affect, impair or prevent the vesting of your rights or powers under this
Agreement or any Loan Document or Applicant's obligation to make reimbursement
or payment to you under this Agreement or any Loan Document. The provisions of
this Section will survive the termination of this Agreement and any Loan
Documents and the expiration or cancellation of any or all the Credits.
SECTION 13. EVENTS OF DEFAULT. Each of the following shall constitute an
Event of Default under this Agreement: (a) Applicant's or any Guarantor's
failure to pay any principal, interest, fee or other amount when due under or in
connection with any L/C Document or any Loan Document; (b) Applicant's failure
to deliver to you Property of a value and character satisfactory to you at any
time you have demanded security from Applicant pursuant to Section 10 of this
Agreement; (c) the occurrence and continuance of any default or defined event of
default under any Loan Document or any other agreement, document or instrument
signed or made by Applicant or any Guarantor in your favor; (d) Applicant's or
any Guarantor's failure to perform or observe any term, covenant or agreement
contained in this Agreement or any Loan Document (other than those referred to
in subsections (a), (b) and (c) of this Section, or the breach of any other
obligation owed by Applicant or any Guarantor to you, and any such failure or
breach shall be impossible to remedy or shall remain unremedied for thirty (30)
calendar days after such failure or breach occurs; (e) any representation,
warranty or certification made or furnished by Applicant or any Guarantor under
or in connection with any L/C Document, any Loan Document or any Collateral, or
as an inducement to you to enter into any L/C Document or Loan Document or to
accept any Collateral, shall be materially false, incorrect or incomplete when
made; (f) any material provision of this Agreement or any Loan Document shall at
any time for any reason cease to be valid and binding on Applicant or any
Guarantor or shall be declared to be null and void, or the validity or
enforceability thereof shall be contested by Applicant, any Guarantor or any
government agency or authority, or Applicant or any Guarantor shall deny that it
has any or further liability or obligation under this Agreement or any Loan
Document; (g) Applicant's or any Guarantor's failure to pay or perform when due
any indebtedness or other obligation Applicant or such Guarantor has to any
person or entity other than you if such failure gives the payee of such
indebtedness or the beneficiary of the performance of such obligation the right
to accelerate the time of payment of such indebtedness or the performance of
such obligation; (h) any guarantee of, or any security covering, any of
Applicant's indebtedness to you arising under or in connection with any L/C
Document or any Loan Document fails to be in full force and effect at any time;
(i) any material adverse change in Applicant's or any Guarantor's financial
condition; (j) Applicant or any Guarantor suspends the transaction of its usual
business or is expelled or suspended from any exchange; (k) Applicant or any
Guarantor dies or is incapacitated; (l) Applicant or any Guarantor dissolves or
liquidates; (m) Applicant or any Guarantor is not generally paying its debts as
they become due; (n) Applicant or any Guarantor becomes insolvent, however such
insolvency may be evidenced, or Applicant or any Guarantor makes any general
assignment for the benefit of creditors; (o) a petition is filed by or against
Applicant or any Guarantor seeking Applicant's or such Guarantor's liquidation
or reorganization under the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time, or a similar action is brought
by or against Applicant or any Guarantor under any federal, state or foreign
law; (p) a proceeding is instituted by or against Applicant or any Guarantor for
any relief under any bankruptcy, insolvency or other law relating to the relief
of debtors, reorganization, readjustment or extension of indebtedness or
composition with creditors; (q) a custodian or a receiver is appointed for, or a
writ or order of attachment, execution or garnishment is issued, levied or made
against, any of Applicant's or any Guarantor's Property or assets; (r) an
application is made by any of Applicant's or any Guarantor's judgment creditors
for an order directing you to pay over money or to deliver other of Applicant's
or such Guarantor's Property; or (s) any government authority or any court takes
possession of any substantial part of Applicant's or any Guarantor's Property or
assets or assumes control over Applicant's or any Guarantor's affairs.
SECTION 14. REMEDIES. Upon the occurrence and continuance of any Event of
Default all amounts paid by you on any Demand which have not previously been
repaid to you, together with all interest on such amounts, and the Unpaid and
Undrawn Balance, if any, shall automatically be owing by Applicant to you and
shall be due and payable by Applicant on demand without presentment or any other
notice of any kind, including, without limitation, notice of nonperformance,
notice of protest, protest, notice of dishonor, notice of intention to
accelerate, or notice of acceleration, all of which are expressly waived by
Applicant. Upon payment of the Unpaid and Undrawn Balance to you Applicant shall
have no further legal or equitable interest therein, and you will not be
required to segregate on your books or records the Unpaid and Undrawn Balance
paid by Applicant. After you receive the Unpaid and Undrawn Balance, you agree
to pay to Applicant, upon termination of all of your liability under all the
Credits and Demands, a sum equal to the amount which has not been drawn under
all the Credits less all amounts due and owing to you from Applicant under or in
connection with the L/C Documents and the Loan Documents. Further, upon the
occurrence and continuance of any Event of Default, you may sell immediately,
without demand for payment, advertisement or notice to Applicant, all of which
are hereby expressly waived, any and all Collateral, received or to be received,
at private sale or public auction or at brokers' board or upon any exchange or
otherwise, at your option, in such parcel or parcels, at such times and places,
for such prices and upon such terms and conditions as you may deem proper, and
you may apply the net proceeds of each sale, together with any sums due from you
to Applicant, to the payment of any and all obligations and liabilities due from
Applicant to you under or in connection with the L/C Documents and the Loan
Documents, all without prejudice to your rights against Applicant with respect
to any and all such obligations and liabilities which may be or remain unpaid.
If any such sale be at brokers' board or at public auction or upon any exchange,
you may yourself be a purchaser at such sale free from any right of redemption,
which Applicant hereby expressly waive and release. All your rights and remedies
existing under the L/C Documents and the Loan Documents are in addition to, and
not exclusive of, any rights or remedies otherwise available to you under
applicable law. In addition to any rights now or hereafter granted under
applicable law, and not by way of limitation of any such rights, upon the
occurrence and continuance of any Event of Default, Applicant hereby authorizes
you at any time or from time to time, without notice to Applicant or to any
other person (any such notice being hereby expressly waived by Applicant) and to
the extent permitted by law, to appropriate and to apply any and all Applicant's
deposits (general or special, including, without limitation, indebtedness
evidenced by certificates of deposit) with you or elsewhere, whether matured or
unmatured, and any other indebtedness at any time held or owing by you to or for
Applicant's credit or its account, against and on account of Applicant's
obligations and liabilities to you under or in connection with any of the L/C
Documents or the Loan Documents, irrespective of whether or not you shall have
made any demand for payment of any or all such obligations and liabilities or
declared any or all such obligations and liabilities to be due and payable, and
although any or all such obligations and liabilities shall be contingent or
unmatured.
SECTION 15. WAIVERS. No delay, extension of time, renewal, compromise or
other indulgence which may occur or be granted by you under any L/C Document or
any Loan Document shall impair your rights or powers under this Agreement or any
Application. You shall not be deemed to have waived any of your rights under
this Agreement or any Application unless such waiver is in writing signed by
your authorized representative. No such waiver, unless expressly provided
therein, shall be effective as to any transactions which occur subsequent to the
date of such waiver or as to the continuance of any Event of Default after such
waiver. No amendment or modification of this Agreement shall be effective unless
it is in writing signed by Applicant's and your authorized representative(s).
SECTION 16. AMENDMENTS AND MODIFICATIONS TO CREDITS. At Applicant's
verbal or written request, or with Applicant's verbal or written consent, and
without extinguishing or otherwise affecting Applicant's obligations under this
Agreement or any Loan Document, you may with respect to any Credit, in writing
or by any other action, but you will not be obligated to, (a) increase the
amount of such Credit, (b) extend the time for, and amend or modify the terms
and conditions governing, the making and honoring of any Demand or Document or
any other terms and conditions of such Credit, or (c) waive the failure of any
Demand or Document to comply with the terms of such Credit, and any Collateral
pledged or granted to you in connection with such Credit will secure Applicant's
obligations to you with respect to such Credit as amended, modified or waived.
No amendment to, or modification of, the terms of any Credit will become
effective if the Beneficiary of such Credit or any confirming bank objects to
such amendment or modification. If any Credit is amended or modified in
accordance with this Section, Applicant shall be bound by, and obligated under,
the provisions of this Agreement with respect to such Credit as so amended or
modified, and any action taken by you or any advising, confirming, negotiating,
paying or other bank in accordance with such amendment or modification.
SECTION 17. SUCCESSORS AND ASSIGNS. The terms and conditions of this
Agreement and each Application shall bind Applicant's heirs, executors,
administrators, successors and assigns, and all rights, benefits and privileges
conferred on you under or in connection with each L/C Document and each Loan
Document shall be and hereby are extended to, conferred upon and may be enforced
by your successors and assigns. Applicant will not assign this Agreement or
Applicant's obligations or liabilities to you under or in connection with any
L/C Document or Loan Document to any person or entity without your prior written
approval.
SECTION 18. GOVERNING LAW. This Agreement and each Application, and
Applicant's and your performance under this Agreement and each Application,
shall be governed by and be construed in accordance with the laws of the State
of California. Unless you otherwise specifically agree in writing, each Credit,
the opening of each Credit, the performance by you under each Credit, and the
performance by the Beneficiary and any advising, confirming, negotiating, paying
or other bank under each Credit, shall be governed by and be construed in
accordance with the UCP in force on the date of the issuance of each Credit. In
the event that any Credit issued pursuant to this Agreement states that it is
governed by the laws of a jurisdiction other than the State of California, then
your performance under such Credit shall be governed.
SECTION 19. JURISDICTION AND SERVICE OF PROCESS. Any suit, action or
proceeding against Applicant under or with respect to any L/C Document may, at
your sole option, be brought in (a) the courts of the State of California, (b)
the United States District Courts in California, (c) the courts of Applicant's
jurisdiction of incorporation or principal office, or (d) the courts of the
jurisdiction where any Beneficiary, any advising, confirming, negotiating,
paying or other bank, or any other person or entity has brought any suit, action
or proceeding against you with respect to any Credit or any Demand, and
Applicant hereby submits to the nonexclusive jurisdiction of such courts for the
purpose of any such suit, action, proceeding or judgment and waives any other
preferential jurisdiction by reason of domicile. Applicant will accept joinder
in any suit, action or proceeding brought in any court or jurisdiction against
you by any Beneficiary, any advising, confirming, negotiating, paying or other
bank or any other person or entity with respect to any Credit or any Demand.
Applicant irrevocably waives trial by jury and any objection, including, without
limitation, any objection of the laying of venue or any objection based on the
grounds of forum non conveniens, which Applicant may now or hereafter have to
the bringing of any such action or proceeding. Applicant further waives any
right to transfer or change the venue of any suit, action or proceeding brought
against Applicant by you under or in connection with any L/C Document. Applicant
irrevocably consents to the service of process in any action or proceeding in
any court by the mailing of copies thereof by registered or certified mail,
postage prepaid, to Applicant at its address specified next to its signature on
this Agreement or at such other address as Applicant shall have notified to you
in writing, such service to be effective ten (10) days after such mailing.
SECTION 20. JOINT APPLICANTS. If this Agreement is signed by more than
one person and/or entity as an Applicant, this Agreement and the Applications
shall be the joint and several agreement of all such persons and/or entities and
that all references to "Applicant" or "Applicant's" in this Agreement and the
Applications shall refer to all such persons and/or entities jointly and
severally.
SECTION 21. SEVERABILITY. Any provision of any L/C Document which is
prohibited or unenforceable in any jurisdiction shall be, only as to such
jurisdiction, ineffective to the extent of such prohibition or unenforceability,
but all the remaining provisions of such L/C Document and all the other L/C
Documents shall remain valid.
SECTION 22. HEADINGS. The headings used in this Agreement are for
convenience of reference only and shall not define or limit the provisions of
this Agreement.
SECTION 23. CREDIT AGREEMENT. This Agreement and any related Application
have been entered into pursuant to the Secured Credit Agreement dated August 8,
2007, among Applicant, as Borrower, Wells Fargo, as Agent, and other financial
institutions (the "Credit Agreement"). For so long as the Credit Agreement
remains in effect, the provisions of Sections 4, 5, 6, 9, 10, 13, 14, and 15 of
this Agreement shall not be effective. In the event that the Credit Agreement is
terminated and any Credit remains outstanding, then the provisions of Sections
4, 5, 6, 9, 10, 13, 14, and 15 hereof shall thereafter apply to all outstanding
Credits until the obligations of the Applicant thereunder have been satisfied in
full.
ADDITIONAL PROVISIONS APPLICABLE IF THE APPLICANT IS LOCATED IN OREGON
----------------------------------------------------------------------
Section Oregon 1. UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND
COMMITMENTS MADE BY A LENDER AFTER OCTOBER 3, 1989 CONCERNING LOANS AND OTHER
CREDIT
EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES OR SECURED
SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION,
AND BE SIGNED BY THE LENDER TO BE ENFORCEABLE.
ADDITIONAL PROVISIONS APPLICABLE IF THE APPLICANT IS LOCATED IN WASHINGTON
--------------------------------------------------------------------------
Section Washington 1. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY,
EXTEND CREDIT OR FOREBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE
UNDER WASHINGTON LAW.
ADDITIONAL PROVISIONS APPLICABLE IF THE APPLICANT IS LOCATED IN NEBRASKA
------------------------------------------------------------------------
Section Nebraska 1. ENFORCEABILITY OF WRITTEN TERMS ONLY. A CREDIT
AGREEMENT MUST BE IN WRITING TO BE ENFORCEABLE UNDER NEBRASKA LAW. TO PROTECT
THE PARTIES FROM ANY MISUNDERSTANDINGS OR DISAPPOINTMENTS, ANY CONTRACT,
PROMISE, UNDERTAKING OR OFFER TO FOREBEAR REPAYMENT OF MONEY OR TO MAKE ANY
OTHER FINANCIAL ACCOMMODATION IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR
EXTENSION OF CREDIT, OR ANY AMENDMENT OF, CANCELLATION OF, WAIVER OF, OR
SUBSTITUTION FOR ANY OR ALL OF THE TERMS OR PROVISIONS OF ANY INSTRUMENT OR
DOCUMENT EXECUTED IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF
CREDIT, MUST BE IN WRITING TO BE EFFECTIVE.
ADDITIONAL PROVISIONS APPLICABLE IF THE APPLICANT IS LOCATED IN IOWA
--------------------------------------------------------------------
Section Iowa 1. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS
AGREEMENT SHOULD BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE
ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN
CONTRACT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT
ONLY BY ANOTHER WRITTEN AGREEMENT.
ADDITIONAL PROVISIONS APPLICABLE IF APPLICANT IS LOCATED IN MISSOURI
--------------------------------------------------------------------
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 REGARDLESS OF LEGAL THEORY UPON WHICH IT IS BASED
THAT IS IN ANY WAY RELATED TO THIS AGREEMENT. TO PROTECT YOU (BORROWER) AND US
(LENDERS AND AGENT) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENT 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.
Section Iowa 2. By signing this Agreement, Applicant acknowledges receipt
of a copy of this Agreement.
This Agreement is signed by Applicant's duly authorized representative or
representatives on the date specified below.
------------------------------------------------ -------------------------------------------------
[Applicant's Name] [Applicant's Name]
By: By:
------------------------------------------------ -------------------------------------------------
------------------------------------------------ -------------------------------------------------
Title: Title:
------------------------------------------------ -------------------------------------------------
------------------------------------------------ -------------------------------------------------
Signature Signature
Address: Address:
------------------------------------------------ -------------------------------------------------
------------------------------------------------ -------------------------------------------------
------------------------------------------------ -------------------------------------------------
Date: Date:
------------------------------------------------ -------------------------------------------------
EXHIBIT 1.1 F
LOAN COMMITMENT AMOUNTS
- ------------------------------------------------------------------------------------------------------------------------------------
Revolving
Credit
Name Commitment Initial
Amount Term Loan Percentages Notice Address
- ------------------------------------------------------------------------------------------------------------------------------------
Wells Fargo Bank, $32,500,000.00 $9,100,000.00 26.0000000% MAC N2790-142
National 100 South Hanley Road, Suite 1400
Association, as a St. Louis, Missouri 63105
Bank Catherine M. Morrissey
Telecopier:(314) 863-6815
- ------------------------------------------------------------------------------------------------------------------------------------
JP Morgan Chase Bank, $17,500,000.00 $4,900,000.00 14.0000000% Commercial Banking
N.A. JPMorgan Chase
IL1-1110
120 South LaSalle, 3rd Floor
Chicago,Illinois 60603
Attention: Kristin Paszcak
Telecopier: (312) 661-9511
- ------------------------------------------------------------------------------------------------------------------------------------
LaSalle Bank National $17,500,000.00 $4,900,000.00 14.0000000% One North Brentwood, Suite 950
Association Clayton, Missouri 63105
Attention: Robert J. Mathias
Telecopier: (314) 621-1612
- ------------------------------------------------------------------------------------------------------------------------------------
The Northern Trust $10,000,000.00 $2,800,000.00 08.0000000% 50 South LaSalle Street, L-09
Company Chicago, Illinois 60603
Attention: Lisa McDermott
Telecopier: (312) 444-4906
- ------------------------------------------------------------------------------------------------------------------------------------
Union Bank of $15,000,000.00 $4,200,000.00 12.0000000% 445 South Figureroa Street
California, N.A. Los Angeles, California 90071
Attention: Dennis A. Cattell
Telecopier: (213) 236-5548
- ------------------------------------------------------------------------------------------- ----------------------------------------
Fifth Third Bank $15,000,000.00 $4,200,000.00 12.0000000% 222 South Riverside Plaza,
(Chicago) 33rd Floor
MD GRVR3B
Chicago, Illinois 60606
Attention: Peter Caligiuri
Telecopier: (312) 704-4115
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. Bank National $17,500,000.00 $4,900,000.00 14.0000000% Correspondent Banking
Association One U.S. Bank Plaza
Mailcode: SL-MO-T11S
St. Louis, Missouri 63101
Attention: Jaycee D. Greene, VP
Telecopier: (314) 418-2173
- ------------------------------------------------------------------------------------------------------------------------------------
EXHIBIT 1.1 G
REVOLVING NOTE
$_________________ St. Louis, Missouri
August 8, 2007
For value received, the undersigned FIRST BANKS, INC., a Missouri
corporation (the "Borrower"), hereby promises to pay on the Revolving Credit
Termination Date (as defined in the Credit Agreement, defined below), to the
order of _____________, a _____________ (the "Lender"), at the office of Wells
Fargo Bank, National Association, as agent (the "Agent") at Sixth Street and
Marquette Avenue, Minneapolis, Minnesota, or at any other place designated at
any time in accordance with the Credit Agreement (as hereinafter defined), in
lawful money of the United States of America and in immediately available funds,
the principal sum of up to _______________ Dollars ($______________) or, if
less, the aggregate unpaid principal amount of all Revolving Loans, as defined
in the Credit Agreement, made by the Lender to the Borrower under the Secured
Credit Agreement together with interest on the principal amount hereunder
remaining unpaid from time to time (the "Principal Balance"), computed on the
basis of the actual number of days elapsed and a 360-day year, from the date
hereof until this Note is fully paid at the rate determined from time to time
under the Credit Agreement dated August 8, 2007 (as the same may be amended,
supplemented or restated from time to time, the "Credit Agreement") by and among
the Borrower, the Lenders from time to time party thereto and Wells Fargo Bank,
National Association, as Agent for the Lenders thereunder. This Note may be
prepaid only in accordance with the Credit Agreement.
This Note is issued pursuant, and is subject, to the Credit Agreement,
which provides, among other things, for acceleration hereof. This Note is a
"Revolving Note" referred to in the Credit Agreement.
This Note is secured, among other things, pursuant to the several
security agreements delivered pursuant to the Credit Agreement, and may now or
hereafter be secured by one or more other security agreements or other
instruments or agreements.
The Borrower hereby agrees to pay all costs of collection, including
reasonable attorneys' fees and legal expenses in the event this Note is not paid
when due, whether or not legal proceedings are commenced.
Presentment or other demand for payment, notice of dishonor and protest
are expressly waived.
FIRST BANKS, INC.
By ________________________________
Its ___________________________
EXHIBIT 1.1 H
SAN FRANCISCO COMPANY GUARANTY
August 8, 2007
This Guaranty is made as of August 8, 2007 by the undersigned, THE SAN
FRANCISCO COMPANY, a Delaware corporation, in favor of WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, as Agent for the "Lenders"
pursuant to the Secured Credit Agreement described below (the "Agent").
RECITALS
First Banks, Inc. (the "Borrower"), the Agent and certain financial
institutions have executed a Secured Credit Agreement dated as of August 8,
2007, (the "Credit Agreement"), pursuant to which such financial institutions
(the "Lenders") have agreed to lend up to $125,000,000 to the Borrower (with
Borrower having the right to increase the credit facilities by an amount up to
$25,000,000) and pursuant to which the Agent has agreed to issue up to
$5,000,000 in face amount of standby letters of credit for the account of the
Borrower.
One condition to the Lenders' and Agent's commitment under the Credit
Agreement is that the undersigned execute, deliver and perform this Guaranty,
thereby guaranteeing the payment and performance of all debts, liabilities and
obligations of the Borrower to the Agent and the Lenders arising out of the
Credit Agreement and any extensions, renewals or replacements thereof (the
"Indebtedness").
Now, therefore, in consideration of the premises, the undersigned hereby
agrees as follows:
1. No act or thing need occur to establish the liability of the
undersigned hereunder, and no act or thing, except full payment and discharge of
all Indebtedness, shall in any way exonerate the undersigned or modify, reduce,
limit, or release the liability of the undersigned hereunder.
2. This is an absolute, unconditional and continuing guaranty of
payment of the Indebtedness and shall continue to be in force and be binding
upon the undersigned, whether or not all Indebtedness is paid in full, until
this Guaranty is revoked prospectively as to future transactions, by written
notice actually received by the Agent, and such revocation shall not be
effective as to Indebtedness existing or committed for at the time of actual
receipt of such notice by the Agent, or as to any renewals, extensions and
refinancings thereof.
3. If the undersigned shall be dissolved or shall be or become
insolvent then the Agent shall have the right to declare immediately due and
payable, and the undersigned will forthwith pay to the Agent, the full amount of
all Indebtedness, whether due and payable or unmatured. If the undersigned
voluntarily commences or there is commenced involuntarily against the
undersigned a case under the United States Bankruptcy Code, the full amount of
all Indebtedness, whether due and payable or unmatured, shall be immediately due
and payable without demand or notice thereof.
4. The undersigned shall be liable for all Indebtedness, without any
limitation as to amount, plus accrued interest thereon and all attorneys' fees,
collection costs and enforcement expenses referable thereto. Indebtedness may be
created and continued in any amount, whether or not in excess of such principal
amount, without affecting or impairing the liability of the undersigned
hereunder. The Agent may apply any sums received by or available to the Agent on
account of the Indebtedness from Borrower or any other person (except the
undersigned), from their properties, out of any collateral security or from any
other source to payment of the excess. Such application of receipts shall not
reduce, affect or impair the liability of the undersigned hereunder.
5. The undersigned will not exercise or enforce any right of
contribution, reimbursement, recourse or subrogation available to the
undersigned against any person liable to payment of the Indebtedness, or as to
any collateral security therefor, unless and until all of the Indebtedness shall
have been fully paid and discharged.
6. The undersigned will pay or reimburse the Agent for all costs and
expenses (including reasonable attorneys' fees and legal expenses) incurred by
the Agent in connection with the protection, defense or enforcement of this
Guaranty in any litigation or bankruptcy or insolvency proceedings.
7. Whether or not any existing relationship between the undersigned and
Borrower has been changed or ended and whether or not this Guaranty has been
revoked, the Agent may, but shall not be obligated to, enter into transactions
resulting in the creation or continuance of Indebtedness, without any consent or
approval by the undersigned and without any notice to the undersigned. The
liability of the undersigned shall not be affected or impaired by any of the
following acts or things (which the Agent is expressly authorized to do, omit or
suffer from time to time, both before and after revocation of this Guaranty,
without notice to or approval by the undersigned): (i) any acceptance of
collateral security, guarantors, accommodation parties or sureties for any or
all Indebtedness; (ii) any one or more extensions or renewals of Indebtedness
(whether or not for longer than the original period) or any modification of the
interest rates, maturities or other contractual terms applicable to any
Indebtedness; (iii) any waiver or indulgence granted to Borrower, any delay or
lack of diligence in the enforcement of Indebtedness, or any failure to
institute proceedings, file a claim, give any required notices or otherwise
protect any Indebtedness, (iv) any full or partial release of, settlement with,
or agreement not to sue, Borrower or any other guarantor or other person liable
in respect of any Indebtedness; (v) any discharge of any evidence of
Indebtedness or the acceptance of any instrument in renewal thereof or
substitution therefor; (vi) any failure to obtain collateral security (including
rights of setoff) for Indebtedness, or to see to the proper or sufficient
creation and perfection thereof, or to establish the priority thereof, or to
protect, insure, or enforce any collateral security; or any modification,
substitution, discharge, impairment, or loss of any collateral security; (vii)
any foreclosure or enforcement of any collateral security; (viii) any transfer
of any Indebtedness or any evidence thereof; (ix) any order of application of
any payments or credits upon Indebtedness; (x) any election by the Agent under
ss. 1111(b)(2) of the United States Bankruptcy Code.
8. The undersigned waives any and all defenses, claims and discharges
of Borrower, or any other obligor, pertaining to Indebtedness, except the
defense of discharge by payment in full. Without limiting the generality of the
foregoing, the undersigned will not assert, plead or enforce against the Agent
any defense of waiver, release, discharge in bankruptcy, statute of limitations,
res judicata, statute of frauds, anti-deficiency statute, fraud, incapacity,
minority, usury, illegality or unenforceability which may be available to
Borrower or any other person liable in respect of any Indebtedness, or any
setoff available against the Agent to Borrower or any such other person, whether
or not on account of a related transaction. The undersigned expressly agrees
that the undersigned shall be and remain liable for any deficiency remaining
after foreclosure of any mortgage or security interest securing Indebtedness,
whether or not the liability of Borrower or any other obligor for such
deficiency is discharged pursuant to statute or judicial decision.
9. The undersigned waives presentment, demand for payment, notice of
dishonor or nonpayment, and protest of any instrument evidencing Indebtedness.
The Agent shall not be required first to resort for payment of the Indebtedness
to Borrower or other persons or their properties, or first to enforce, realize
upon or exhaust any collateral security for Indebtedness, before enforcing this
Guaranty.
10. If any payment applied by the Agent to Indebtedness is thereafter
set aside, recovered, rescinded or required to be returned for any reason
(including, without limitation, the bankruptcy, insolvency or reorganization of
Borrower or any other obligor), the Indebtedness to which such payment was
applied shall for the purposes of this Guaranty be deemed to have continued in
existence, notwithstanding such application, and this Guaranty shall be
enforceable as to such Indebtedness as fully as if such application had never
been made.
11. The liability of the undersigned under this Guaranty is in addition
to and shall be cumulative with all other liabilities of the undersigned to the
undersigned as guarantor or otherwise, without any limitation as to amount,
unless the instrument or agreement evidencing or creating such other liability
specifically provides to the contrary.
12. This Guaranty shall be effective upon delivery to the Agent, without
further act, condition or acceptance by the Agent, shall be binding upon the
undersigned and the successors and assigns of the undersigned and shall inure to
the benefit of the Agent and the Lenders and their respective participants,
successors and assigns. Any invalidity or unenforceability of any provision or
application of this Guaranty shall not affect other lawful provisions and
application hereof, and to this end the provisions of this Guaranty are declared
to be severable. This Guaranty may not be waived, modified, amended, terminated,
released or otherwise changed except by a writing signed by the undersigned and
the Agent. This Guaranty shall be governed by the laws of the State of Missouri.
The undersigned waives notice of the Agent's acceptance hereof and waives the
right to a trial by jury in any action based on or pertaining to this Guaranty.
13. This Guaranty, and each and all of the undersigned's obligations
hereunder, is secured by that certain San Francisco Company Security Agreement
of even date herewith, as hereafter amended, modified and supplemented and may
now be secured by one or more other security agreements or other instruments or
agreements.
In witness whereof, the undersigned has executed this Guaranty as of the
day and year first above written.
THE SAN FRANCISCO COMPANY
By _________________________________
Its _____________________________
EXHIBIT 1.1 I
SAN FRANCISCO COMPANY SECURITY AGREEMENT
This Agreement is made as of August 8, 2007, by and between THE SAN
FRANCISCO COMPANY, a Delaware Corporation ("Debtor") and WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, as Agent for the "Lenders"
pursuant to the Secured Credit Agreement described below ("Secured Party").
RECITALS
First Banks, Inc., a Missouri corporation (the "Borrower"), Secured Party
and certain financial institutions have executed a Secured Credit Agreement
dated as of August 8, 2007, (the "Credit Agreement"), pursuant to which such
financial institutions (the "Lenders") have agreed to lend up to $125,000,000 to
Borrower (with Borrower having the right to increase the credit facilities by an
amount up to $25,000,000) and pursuant to which Secured Party has agreed to
issue up to $5,000,000 in face amount of standby letters of credit for the
account of Borrower.
One condition to the Lenders' and Secured Party's commitments under the
Credit Agreement is that Debtor execute, deliver and perform this Agreement,
thereby granting a security interest to Secured Party, as agent for the Lenders,
in the Collateral described herein for the purpose of securing all
"Indebtedness", as that term is defined in that certain Guaranty of even date
herewith given by Debtor for the benefit of Secured Party (the "Guaranty").
Now, therefore, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto hereby agree as follows:
1. Security Interest and Collateral. To secure the prompt and
complete payment and performance of both said Indebtedness and any and all
obligations of Debtor arising under or on account of this Agreement
(collectively the "Secured Obligations"), Debtor hereby grants Secured Party
(for its own account and as agent for the Lenders) a security interest (the
"Security Interest") in (i) all of the capital stock of First Bank, a Missouri
state bank, owned by Debtor, and (ii) any capital stock that Debtor may
hereafter acquire and deliver to Secured Party pursuant to Section 8.8 of the
Credit Agreement, and (iii) all proceeds of such capital stock and all other
rights in connection with such property (collectively the "Collateral").
2. Representations, Warranties and Covenants. Debtor represents,
warrants and covenants that:
(a) Debtor will join with Secured Party in taking any action
required by Secured Party in order to perfect the Security Interest and
to protect the rights and priorities of Secured Party with respect to the
Collateral. To that end, Debtor has delivered to Secured Party
certificates representing all of the shares of capital stock constituting
Collateral and executed and delivered one blank stock power for each such
certificate. Debtor will, at Secured Party's request at any one or more
times (i) duly endorse, in blank, each and every additional security
certificate and instrument constituting Collateral by signing on such
certificate or instrument or by signing a separate document of assignment
or transfer and delivery to Secured Party each and every such additional
security certificate and instrument; (ii) join with Secured Party in
executing any instructions or agreements with securities intermediaries
for the purpose of obtaining control of any investment property that may
hereafter constitute Collateral; and (iii) instruct the issuer of any
security that may hereafter constitute Collateral to register such
security in the name of Secured Party.
(b) Debtor is the owner of the Collateral free and clear of all
liens, encumbrances, security interests and restrictions except the
Security Interest and any restrictive legend appearing on any security
certificate or any instrument constituting Collateral.
(c) Debtor will keep the Collateral free and clear of all liens,
encumbrances and security interests, except the Security Interest.
(d) Debtor will pay, when due, all taxes and other governmental
charges levied or assessed upon or against any Collateral.
(e) Debtor will upon receipt deliver to Secured Party all
investment property distributed on account of Collateral, such as stock
dividends and securities resulting from stock splits, reorganizations and
recapitalizations. The Security Interest shall attach to all such
proceeds.
3. Events of Default. The occurrence of any Event of Default under the
Credit Agreement shall be an Event of Default hereunder.
4. Remedies Upon Event of Default. Upon the occurrence of an Event of
Default and during the continuance thereof, Secured Party may exercise any one
or more of the rights and remedies specified in the Credit Agreement or in the
Guaranty, and also any one or more of the following rights or remedies: (i)
notify the obligor on or issuer of any Collateral or any securities intermediary
to make payment to Secured Party of any amounts due or distributable on any
Collateral, (ii) receive and keep in its possession or under its control subject
to the Security Interest all proceeds of Collateral, except that any money
received from the Collateral may, at Secured Party's option, be applied in
reduction of the Secured Obligations; (iii) exercise all voting and other rights
as a holder of any Collateral; (iv) exercise and enforce any or all rights and
remedies available upon default to a secured party under the Uniform Commercial
Code, including the right to (A) order any securities intermediary to sell any
Collateral on any established market or over the counter or to cause any
Collateral to be redeemed; (B) give any transfer or redemption order to any
issuer of Collateral; or (C) offer and sell Collateral privately to purchasers
who will agree to take the Collateral for investment and not with a view to
distribution and who will agree to the imposition of restrictive legends on any
certificates representing Collateral, and the right to arrange for a sale which
would otherwise qualify as exempt from registration under the Securities Act of
1933; and if notice to Debtor of any intended disposition of Collateral or any
other intended action is required by law in a particular instance, such notice
shall be deemed commercially reasonable if given at least 10 calendar days prior
to the date of intended disposition or other action; and (v) exercise or enforce
any or all other rights or remedies available to Secured Party by law or
agreement against any Collateral, against Debtor or against any other person or
property.
5. Secured Party's Duties. Secured Party's duty of care with respect to
Collateral in its possession (as imposed by law) shall be deemed fulfilled if
Secured Party exercises reasonable care in physically safekeeping such
Collateral, or in the case of Collateral in the custody or possession of a
securities intermediary or other third person, exercises reasonable care in the
selection of the securities intermediary or other third person and Secured Party
need not otherwise preserve, protect, insure or care for any Collateral. Secured
Party shall not be obligated to preserve any rights Debtor may have against
prior parties, to exercise at all or in any particular manner any voting rights
which may be available with respect to any Collateral, to realize on the
Collateral at all or in any particular manner or order, or to apply any cash
proceeds of Collateral in any particular order of application. Regardless of the
manner in which Secured Party chooses to exercise control over Collateral
(whether by possession, by agreement with an issuer or Securities Intermediary,
by transferring security entitlements into its own account, or otherwise),
Secured Party shall not be deemed to be under any obligation to Debtor, whether
as fiduciary, trustee, agent or otherwise, except the duty of good faith, the
duties specifically imposed upon Secured Party by this Agreement, and the duties
imposed upon it as a secured party by Articles 1, 8 and 9 of the Uniform
Commercial Code, as in effect in Missouri.
6. Miscellaneous. Any disposition of Collateral in the manner provided in
Section 4 shall be deemed commercially reasonable. This Agreement can be waived,
modified, amended, terminated or discharged, and the Security Interest can be
released, only explicitly in a writing signed by Secured Party. A waiver signed
by Secured Party shall be effective only in the specific instance and for the
specific purpose given. Mere delay or failure to act shall not preclude the
exercise or enforcement of any of Secured Party's rights or remedies. All rights
and remedies of Secured Party shall be cumulative and may be exercised
singularly or concurrently, at Secured Party's option, and the exercise or
enforcement of any one such right or remedy shall neither be a condition to nor
bar the exercise or enforcement of any other. All notices to be given to Debtor
shall be deemed sufficiently given if delivered or mailed by registered or
certified mail, postage prepaid, to Debtor at the address set forth following
its signature on the signature page of this Agreement or at the most recent
address shown on Secured Party's records. Debtor will reimburse Secured Party
for all expenses (including reasonable attorneys' fees and legal expenses)
incurred by Secured Party in the protection, defense or enforcement of the
Security Interest, including expenses incurred in any litigation or bankruptcy
or insolvency proceedings. This Agreement shall be binding upon and inure to the
benefit of Debtor and Secured Party and their successors and assigns and shall
take effect when signed by Debtor and delivered to Secured Party, and Debtor
waives notice of Secured Party's acceptance hereof. This Agreement shall be
governed by the internal laws of the State of Missouri and, unless the context
otherwise requires, all terms used herein which are defined in Articles 1, 8 and
9 of the Uniform Commercial Code, as in effect in Missouri, shall have the
meanings therein stated. If any provision or application of this Agreement is
held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be
given effect, and this Agreement shall be construed as if the unlawful or
unenforceable provision or application had never been contained herein or
prescribed hereby. All representations and warranties contained in this
Agreement shall survive the execution, delivery and performance of this
Agreement and the creation and payment of the Secured Obligations.
IN WITNESS WHEREOF, Debtor has executed this Agreement as of the day
first above written.
THE SAN FRANCISCO COMPANY
Address:
By
- ------------------------------------ ------------------------------------
Its
- ------------------------------------ ---------------------------------
- ------------------------------------
EXHIBIT 1.1 J
SWINGLINE NOTE
$ St. Louis, Missouri
--------------------------
August 8, 2007
For value received, the undersigned FIRST BANKS, INC., a Missouri
corporation (the "Borrower"), hereby promises to the order of Wells Fargo Bank,
National Association (the "Swingline Lender"), at the office of the Swingline
Lender at Sixth Street and Marquette Avenue, Minneapolis, Minnesota, or at any
other place designated at any time in accordance with the Credit Agreement (as
hereinafter defined), in lawful money of the United States of America and in
immediately available funds, the principal sum of up to $ ($ ) or, if less, the
aggregate unpaid principal amount of all Swingline Loans, as defined in the
Credit Agreement, made by the Swingline Lender to the Borrower under the Credit
Agreement together with interest on the principal amount hereunder remaining
unpaid from time to time (the "Principal Balance"), computed on the basis of the
actual number of days elapsed and a 360-day year, from the date hereof until
this Note is fully paid at the Floating Rate, as defined under the Secured
Credit Agreement, dated as of August 8, 2007 (as the same may be amended,
supplemented or restated from time to time, the "Credit Agreement"), by and
among the Borrower, the Lenders signatory thereto and Wells Fargo Bank, National
Association, as Agent for the Lenders thereunder. Capitalized terms used but not
defined herein shall have the meanings set forth in the Credit Agreement. This
Note may be prepaid only in accordance with the Credit Agreement.
The full Principal Balance of all then outstanding Swingline Loans,
together with all accrued and unpaid interest thereon shall be due and payable
on the next to occur following a Swingline Loan of the fifteenth (15th) day of
the month (or the next Bank Business Day if such day is a Saturday, Sunday,
United States national holiday or other day on which banks in Minnesota are
permitted or required by law to close) and the last Bank Business Day of the
month, commencing August 15, 2007.
This Note is issued pursuant, and is subject, to the Credit Agreement.
This Note is a "Swingline Note" referred to in the Credit Agreement.
This Note is secured, among other things, pursuant to the several
security agreements delivered pursuant to the Credit Agreement, and may now or
hereafter be secured by one or more other security agreements or other
instruments or agreements.
The Borrower hereby agrees to pay all costs of collection, including
reasonable attorneys' fees and legal expenses in the event this Note is not paid
when due, whether or not legal proceedings are commenced.
Presentment or other demand for payment, notice of dishonor and protest
are expressly waived.
BORROWER: FIRST BANKS, INC.
By ___________________________
Its __________________________
EXHIBIT 2.2.1
NOTICE OF BORROWING
Pursuant to Section 2.2.1 of that certain Secured Credit Agreement dated
as of August 8, 2007, as amended, supplemented or otherwise modified to the date
hereof (said Credit Agreement, as so amended, supplemented or otherwise
modified, being the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and among
First Banks, Inc., a Missouri corporation (the "Borrower"), the financial
institutions listed therein as Lenders (the "Lenders"), and Wells Fargo Bank,
National Association, as Agent (the "Agent"), this represents Borrower's request
to borrow as follows:
1. Date of borrowing:
------------------ ----------------------, ---------
2. Amount of borrowing: $
------------------- ------------------------
3. Type of Loans: [Revolving Loans] [Term Loan]
-------------
4. Interest rate option:
--------------------
[ ] a. Floating Rate Loan(s)
[ ] b. Eurodollar Rate Loans with an initial Interest Period of
month(s)
--------
The proceeds of such Loans are to be deposited in an account
designated by the Borrower at First Bank or in such other manner as the Agent
and the Borrower may agree in writing.
The undersigned officer, to the best of his or her knowledge, and
Borrower certify that:
(i) With respect to Loans, the representations and warranties
contained in the Credit Agreement and the other Loan Documents are true, correct
and complete in all material respects on and as of the date hereof to the same
extent as though made on and as of the date hereof, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties were true, correct and complete in all
material respects on and as of such earlier date; provided, that, if a
--------
representation and warranty is qualified as to materiality, with respect to such
representation and warranty the materiality qualifier set forth above shall be
disregarded for purposes of this condition;
(ii) No event has occurred and is continuing or would result from the
consummation of the borrowing contemplated hereby that would constitute a
Default or an Event of Default.
DATED: FIRST BANKS, INC.
------------------
By:
--------------------------------------
Title:
----------------------------------
EXHIBIT 2.2.2
NOTICE OF CONVERSION/CONTINUATION
Pursuant to Section 2.2.2 of that certain Secured Credit Agreement dated
as of August 8, 2007, as amended, supplemented or otherwise modified to the date
hereof (said Credit Agreement, as so amended, supplemented or otherwise
modified, being the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and among
First Banks, Inc., a Missouri corporation (the "Borrower"), the financial
institutions listed therein as Lenders, and Wells Fargo Bank, National
Association, as Agent (the "Agent"), this represents Borrower's request to
convert or continue Loans as follows:
1. Date of conversion/continuation: ________________,_______
2. Amount of Loans being converted/continued: $_______________
3. Type of Loans being converted/continued: [Revolving Loans]
[Term Loan]
4. Nature of conversion/continuation:
[ ] a. Conversion of Floating Rate Loans to Eurodollar Rate
Loans
[ ] b. Continuation of Eurodollar Rate Loans as such
5. If Loans are being continued as or converted to Eurodollar
Rate Loans, the duration of the new Interest Period that commences on the
conversion/continuation date: _______________ month(s)
In the case of a conversion to or continuation of Eurodollar Rate
Loans, the undersigned officer, to the best of his or her knowledge, and
Borrower certify that no Default or Event of Default has occurred and is
continuing.
DATED: ____________________ FIRST BANKS, INC.
By: ___________________________________
Title: ________________________________
EXHIBIT 2.2.3
PERMISSIBLE SECURITIES
The following qualify as "Permissible Securities:"
Valuation Percentage
--------------------
A. Cash 100%
B. (x) Negotiable debt obligations issued by the U.S. Treasury Department or the
Government National Mortgage Association ("Ginnie Mae"), or (y) mortgage-backed
securities issued by Ginnie Mae (but with respect to either (x) or (y) excluding
interest only or principal only stripped securities, securities representing
residual interests in mortgage pools, and securities that are not listed on a
national securities exchange or regularly quoted in a national quotation
service) and in each case having a remaining maturity of:
(i) less than one year 100%
(ii) one year or greater but less than 10 years 98%
(iii) ten years or longer 95%
C. (x) Negotiable debt obligations issued by the Federal Home Loan Mortgage
Association ("Freddie Mac") or (y) mortgage-backed securities issued by Freddie
Mac but excluding interest only or principal only stripped securities,
securities representing residual interests in mortgage pools, and securities
that are not listed on a national securities exchange or regularly quoted in a
national quotation service. 95%
EXHIBIT 2.4.1
NOTICE OF SWINGLINE BORROWING
Pursuant to Section 2.4.1 of that certain Secured Credit Agreement dated
as of August 8, 2007, as the same may be amended, supplemented or otherwise
modified to the date hereof (said Secured Credit Agreement, as so amended,
supplemented or otherwise modified, being the "Credit Agreement," the terms
defined therein and not otherwise defined herein being used herein as therein
defined), by and among First Banks, Inc., a Missouri corporation (the
"Borrower"), the financial institutions listed therein as Lenders (the
"Lenders"), and Wells Fargo Bank, National Association, as Agent (the "Agent"),
this represents Borrower's request to borrow as follows:
1. Amount of Swingline Borrowing: $
----------------------------- --------------------
2. Date of Swingline Borrowing:
--------------------------- --------------------, -------
The proceeds of such Advance are to be deposited in an account
designated by the Borrower at First Bank or in such other manner as the Agent
and the Borrower may agree in writing.
The undersigned officer, to the best of his or her knowledge, and
Borrower certify to Swingline Lender and the Lenders that:
(i) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are true, correct and complete in all
material respects on and as of the date hereof to the same extent as though made
on and as of the date hereof, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date; provided, that, if a representation and
--------
warranty is qualified as to materiality, with respect to such representation and
warranty the materiality qualifier set forth above shall be disregarded for
purposes of this condition; and
(ii) No event has occurred and is continuing or would result from the
consummation of the Swingline Borrowing contemplated hereby that would
constitute a Default or an Event of Default.
DATED: FIRST BANKS, INC.
------------------------
By:
--------------------------------
Title:
-----------------------------
EXHIBIT 2.5.2
TERM LOAN NOTICE
Pursuant to Section 2.5.2 of that certain Secured Credit Agreement dated
as of August 8, 2007, as the same may be amended, supplemented or otherwise
modified to the date hereof (said Secured Credit Agreement, as so amended,
supplemented or otherwise modified, being the "Credit Agreement," the terms
defined therein and not otherwise defined herein being used herein as therein
defined), by and among First Banks, Inc., a Missouri corporation (the
"Borrower"), the financial institutions listed therein as Lenders, and Wells
Fargo Bank, National Association, as Agent (the "Agent"), this represents
Borrower's request to convert the following portion of the Outstanding Revolving
Loan to an Additional Term Loan as follows:
1. Effective date of the Additional Term Loan: __________________,
_______
2. Amount of the Additional Term Loan: $___________________
3. Portion of the outstanding Revolving Loans to which such
Additional Term Loan is to be applied, including the interest
rate(s) currently applicable thereto:
________________________________________________________________________________
3. If the Eurodollar rate is applicable to any portion of the
related Revolving Loan:
a. The Interest Period that has been selected by Borrower at
inception of the related Revolving
Loan:__________________________
b. The duration of the Interest Period for the related
Revolving Loan: _______________ month(s)
c. The expiration of the Interest Period for the related
Revolving Loan: __________________, __________
4. If the Eurodollar rate is applicable to any portion of the
related initial Advance:
a. The Interest Period that has been selected by Borrower at
inception of the related initial
Advance:__________________________
b. The duration of the Interest Period for the related initial
Advance: _______________ month(s)
c. The expiration of the Interest Period for the related
initial Advance: __________________, __________
The undersigned officer, to the best of his or her knowledge, and
Borrower certify to the Lenders that:
(i) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are true, correct and complete in all
material respects on and as of the date hereof to the same extent as though made
on and as of the date hereof, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date; provided, that, if a representation and
--------
warranty is qualified as to materiality, with respect to such representation and
warranty the materiality qualifier set forth above shall be disregarded for
purposes of this condition; and
(ii) No event has occurred and is continuing or would result from
the consummation of the conversion of the above described portion of the
Outstanding Revolving Loan to an Additional Term Loan that would constitute a
Default or an Event of Default.
DATED: FIRST BANKS, INC.
---------------------
By:
---------------------------------
Title:
------------------------------
EXHIBIT 8.9
NOTICE OF PERMITTED ACQUISITION
This Notice is being submitted on this ___ day of ________, 200__,
pursuant to Section 8.9 of the Secured Credit Agreement dated as of August 8,
2007, as the same may be amended, supplemented or otherwise modified to the date
hereof (the "Credit Agreement"), by and among Wells Fargo Bank, National
Association (the "Agent"), the Lenders that are parties thereto, and First
Banks, Inc., as Borrower. Capitalized terms used but not defined herein shall
have the meanings set forth in the Credit Agreement.
The undersigned officer of the Borrower hereby notifies the Lenders that
[the Borrower] [_________ (name of Subsidiary)] has entered into an agreement to
purchase [______% of the voting common stock] [all of the assets of the
business] [all of the assets of the ____ branch(s)] of
__________________________________ (name and organizational details of acquired
entity). A brief description of the transaction, including the form of the
acquisition, amount and nature of the consideration, and expected date of
completion, is attached to this Notice as Annex A.
The undersigned officer hereby certifies to the Lenders that:
A. The representations and warranties contained in Article VII of
the Credit Agreement are correct as of the date hereof and
will be correct after giving effect to the proposed
acquisition, except to the extent that the same relate
specifically to an earlier date; and
B. No Default or Event of Default has occurred and is continuing,
or will occur as a result of the proposed acquisition.
This will confirm that promptly upon request of Agent or any Lender,
First Banks, Inc. will provide to the Agent copies of any applications to
regulatory agencies submitted in connection with the proposed acquisition.
Signed as of the day and year first above written.
FIRST BANKS, INC.
By_________________________________
[name and office held]
EXHIBIT 2.1.2 A
FORM OF REQUEST FOR INCREASE IN
TOTAL REVOLVING LOAN COMMITMENT AMOUNT
Wells Fargo Bank, N.A., Agent
Attention: Catherine M. Morrissey
MAC N2790-142
100 South Hanley Road, Suite 1400
St. Louis, Missouri 63105
Dear Ms. Morrissey:
Reference is made to that certain Secured Credit Agreement dated as of
August 8, 2007, as amended, supplemented or otherwise modified to the date
hereof (said Credit Agreement, as so amended, supplemented or otherwise
modified, being the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and among
First Banks, Inc., a Missouri corporation (the "Borrower"), the financial
institutions listed therein as Lenders (the "Lenders"), and Wells Fargo Bank,
National Association, as Agent (the "Agent"). Terms used but not otherwise
defined herein are used herein as defined in the Credit Agreement.
In accordance with Section 2.1.2 of the Credit Agreement, the Borrower
hereby requests an increase in the aggregate Total Revolving Loan Commitment
Amount from $_______________ to $_______________ (the "Increase"), pursuant to
this "Request for Increase in the Total Revolving Loan Commitment Amount." (The
Total Revolving Loan Commitment Amount may not exceed $150,000,000; minimum
aggregate increase is Ten Million Dollars ($10,000,000) and thereafter in
multiples of Five Million Dollars ($5,000,000).) The requested effective date of
the Increase is ____________________ (at least 30 days from date of request).
The Borrower hereby certifies that as of the date hereof and the
effective date of the Increase:
(a) attached hereto as Exhibit A is a true, complete and correct copy of
the resolutions, duly adopted by the board of directors of the Borrower and
certified by the [Secretary] [Assistant Secretary] of the Borrower, authorizing
the Increase and such resolutions have not been amended, modified, rescinded or
revoked since their adoption, and remain in full force and effect;
(b) all of the representations and warranties contained in the Credit
Agreement and the other Loan Documents are true, correct and complete in all
material respects on and as of the date hereof to the same extent as though made
on and as of the date hereof, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date; and
(c) no Default, Event of Default, or event or condition which, with the
giving of any notice and/or the passage of time would constitute a Default or
Event of Default, has occurred and is continuing, and none will occur as a
result of the Increase.
Dated as of ________________________, 200__.
BORROWER: FIRST BANKS, INC.
By: _____________________________
Title: __________________________
ACKNOWLEDGEMENT AND CONSENT
The San Francisco Company hereby acknowledges and consents to the above
and foregoing Request for Increase in the Total Revolving Loan Commitment
Amount, dated as of ________________________, 200__, and agrees that any and all
of its obligations under or on account of the Loan Documents are and remain in
full force and effect unaffected by or on account of the Secured Credit
Agreement, as of August 8, 2007.
THE SAN FRANCISCO COMPANY, a
Delaware Corporation
By:_______________________________________
Printed Name:_____________________________
(SEAL) Title: ___________________________________
EXHIBIT 2.1.2 B
FORM OF REQUEST FOR CONSENT TO INCREASE
Wells Fargo Bank, N.A., Agent
Attention: Catherine M. Morrissey
MAC N2790-142
100 South Hanley Road, Suite 1400
St. Louis, Missouri 63105
Dear Ms. Morrissey:
Reference is made to that certain Secured Credit Agreement dated as of
August 8, 2007, as amended, supplemented or otherwise modified to the date
hereof (said Credit Agreement, as so amended, supplemented or otherwise
modified, being the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and among
First Banks, Inc., a Missouri corporation (the "Borrower"), the financial
institutions listed therein as Lenders (the "Lenders"), and Wells Fargo Bank,
National Association, as Agent (the "Agent"). Terms used but not otherwise
defined herein are used herein as defined in the Credit Agreement.
In accordance with Section 2.1.2 of the Credit Agreement, we hereby give
you notice of, and request your consent to, the assumption by [insert Lender
name] (the "Increasing Lender"), a Lender, on [insert date] of an increased
Revolving Credit Commitment Amount in the amount of $_______________, pursuant
to this "Request for Consent to Increase."
IN WITNESS WHEREOF, the Borrower and the Increasing Lender have caused
this request to be executed by their respective duly authorized officials,
officers or agents as of ________________________, 200__.
BORROWER: FIRST BANKS, INC.
By:__________________________________
Title:_______________________________
INCREASING LENDER:
By:__________________________________
Title:_______________________________
ACKNOWLEDGEMENT AND CONSENT
The San Francisco Company hereby acknowledges and consents to the above
and foregoing Request for Consent to Increase, dated as of
________________________, 200__, and agrees that any and all of its obligations
under or on account of the Loan Documents are and remain in full force and
effect unaffected by or on account of the Secured Credit Agreement as of August
8, 2007.
THE SAN FRANCISCO COMPANY, a
Delaware Corporation
By:_______________________________________
Printed Name:_____________________________
(SEAL) Title:____________________________________
EXHIBIT 2.1.2 C
FORM OF REQUEST FOR ADDITIONAL LENDER
Wells Fargo Bank, N.A., Agent
Attention: Catherine M. Morrissey
MAC N2790-142
100 South Hanley Road, Suite 1400
St. Louis, Missouri 63105
Dear Ms. Morrissey:
Reference is made to that certain Secured Credit Agreement dated as of
August 8, 2007, as amended, supplemented or otherwise modified to the date
hereof (said Credit Agreement, as so amended, supplemented or otherwise
modified, being the "Credit Agreement," the terms defined therein and not
otherwise defined herein being used herein as therein defined), by and among
First Banks, Inc., a Missouri corporation (the "Borrower"), the financial
institutions listed therein as Lenders (the "Lenders"), and Wells Fargo Bank,
National Association, as Agent (the "Agent"). Terms used but not otherwise
defined herein are used herein as defined in the Credit Agreement.
In accordance with Section 2.1.2 of the Credit Agreement, we hereby give
you notice of, and request your consent to, the assumption on [insert date], by
[insert new Lender name] (the "Additional Lender") of a Revolving Credit
Commitment Amount in the amount of $____________ and all related rights,
benefits, obligations, liabilities and indemnities of a Lender under and in
connection with the Credit Agreement, pursuant to this "Request for Additional
Lender."
After giving effect to such assumption, the Additional Lender shall have
___% of the aggregate amount of the Total Revolving Loan Commitment Amount, or
$__________.
The Additional Lender agrees that, upon receiving the consent of the
Agent to such assumption, the Additional Lender will be bound by the terms of
the Credit Agreement as fully and to the same extent as if the Additional Lender
were a Lender originally holding such interest in the Credit Agreement.
Attached to this Request for Additional Lender as Attachment A is a
completed administrative questionnaire, in the form supplied by Agent, setting
forth the administrative details for the Additional Lender.
IN WITNESS WHEREOF, the Borrower and the Additional Lender have caused
this request to be executed by their respective duly authorized officials,
officers or agents as of ________________________, 200__.
BORROWER: FIRST BANKS, INC.
By:__________________________
Title:_______________________
ADDITIONAL LENDER:
By:_________________________
Title:______________________
ACKNOWLEDGEMENT AND CONSENT
The San Francisco Company hereby acknowledges and consents to the above
and foregoing Request for Additional Lender, dated as of
________________________, 200__, and agrees that any and all of its obligations
under or on account of the Loan Documents are and remain in full force and
effect unaffected by or on account of the Secured Credit Agreement as of August
8, 2007.
THE SAN FRANCISCO COMPANY, a
Delaware Corporation
By:_______________________________________
Printed Name:_____________________________
(SEAL) Title:____________________________________
SCHEDULE 7.4
SUBSIDIARIES OF FIRST BANKS, INC.
Subsidiary Owner Ownership Percentage
---------- ----- --------------------
The San Francisco Company First Banks, Inc. 100.00%
First Bank Statutory Trust First Banks, Inc. 100.00%
First Bank Statutory Trust II First Banks, Inc. 100.00%
First Bank Statutory Trust III First Banks, Inc. 100.00%
First Bank Statutory Trust IV First Banks, Inc. 100.00%
First Bank Statutory Trust V First Banks, Inc. 100.00%
First Bank Statutory Trust VI First Banks, Inc. 100.00%
First Bank Statutory Trust VII First Banks, Inc. 100.00%
First Bank Statutory Trust VIII First Banks, Inc. 100.00%
Royal Oaks Capital Trust I First Banks, Inc. 100.00%
First Preferred Capital Trust IV First Banks, Inc. 100.00%
First Bank The San Francisco Company 100.00%
Adrian N. Baker & Company First Bank 100.00%
First Bank Business Capital, Inc. First Bank 100.00%
First Land Trustee Corp. First Bank 100.00%
Missouri Valley Partners, Inc. First Bank 100.00%
Small Business Loan Source LLC First Bank 76.00%
Small Business Loan Source Funding Corp. First Bank 100.00%
Universal Premium Acceptance Corporation First Bank 100.00%
UPAC of California, Inc. Universal Premium 100.00%
Acceptance Corporation
SCHEDULE 7.7
LITIGATION
None.
SCHEDULE 9.1
EXISTING LIENS
None.
SCHEDULE 9.2
INDEBTEDNESS
In June 2005, Small Business Loan Source LLC ("SBLS LLC") executed a
Multi-Party Agreement by and among SBLS LLC, First Bank, Colson Services Corp.
and the United States Small Business Administration (the "SBA"), and a Loan and
Security Agreement by and among First Bank and the SBA (collectively, the
"Agreement") that provided a $50.0 million warehouse line of credit for loan
funding purposes. The Agreement provided for an initial maturity date of June
30, 2008, which was extended on June 15, 2006 by First Bank to June 30, 2009.
Interest was payable monthly, in arrears, on the outstanding balances at a rate
equal to First Bank's prime lending rate minus 50 basis points. On March 1,
2007, SBLS LLC modified the Agreement with First Bank. The primary modifications
to the structure of the financing arrangement include (a) an increase in the
warehouse line of credit from $50.0 million to $60.0 million; and (b) interest
is payable monthly, in arrears, on the outstanding balances at a rate equal to
First Bank's prime lending rate minus 50 basis points, with the option of
electing to have a portion of the outstanding principal balance in amounts not
greater than $40.0 million, in minimum increments of $500,000, bear interest at
a fixed rate per annum equal to the one-month London Interbank Offering Rate
("LIBOR") plus 215 basis points, the three-month LIBOR plus 215 basis points or
the long-term interest rate swap rate plus 215 basis points, provided that no
more than three fixed-rate interest periods may be in effect at any given time
and no interest period may extend beyond the maturity date. Advances under the
Agreement are secured by the assignment of the majority of the assets of SBLS
LLC. The balance of advances outstanding under the Agreement was $51.8 million
at June 30, 2007. Interest expense recorded under the Agreement by SBLS LLC for
the six months ended June 30, 2007 was $1.9 million.
In May 2007, Universal Premium Acceptance Corporation, a wholly owned
subsidiary of First Bank, executed a Promissory Note payable to First Bank that
provides a $150.0 million unsecured revolving line of credit for loan funding
and other general corporate purposes and has a maturity date of May 31, 2008.
The Promissory Note represents a renewal of the previous promissory note
executed in May 2006 that matured in May 2007. Interest is payable monthly, in
arrears, on the outstanding balances at a varying rate per annum which is forty
(40) basis points less than the Ninety-Day LIBOR (but may not exceed the maximum
rate of non-usurious interest allowed from time to time by law, hereinafter
called the "Highest Lawful Rate"), with adjustments in such varying rate to be
made on the first day of each quarterly period beginning on October 1, 2006, and
adjustments due to changes in the Highest Lawful Rate to be made on the
effective date of any change in the Highest Lawful Rate. The balance of advances
outstanding under the Promissory Note was $131.7 million at June 30, 2007.
Interest expense recorded on the Promissory Note by Universal Premium Acceptance
Corporation for the six months June 30, 2007 was $3.5 million.
SCHEDULE 9.3
GUARANTIES
In October 2000, First Banks, Inc. ("First Banks") entered into two
continuing guaranty contracts. For value received, and for the purpose of
inducing a pension fund and its trustees and a welfare fund and its trustees
(the Funds) to conduct business with Missouri Valley Partners, Inc. (MVP), First
Bank's institutional investment management subsidiary, First Banks irrevocably
and unconditionally guaranteed payment of and promised to pay to each of the
Funds any amounts up to the sum of $5.0 million to the extent MVP is liable to
the Funds for a breach of the Investment Management Agreements (including the
Investment Policy Statement and Investment Guidelines), by and between MVP and
the Funds and/or any violation of the Employee Retirement Income Security Act by
MVP resulting in liability to the Funds. The guaranties are continuing
guaranties of all obligations that may arise for transactions occurring prior to
termination of the Investment Management Agreements and are coexistent with the
term of the Investment Management Agreements. The Investment Management
Agreements have no specified term but may be terminated at any time upon written
notice by the Trustees or, at First Banks' option, upon thirty days written
notice to the Trustees. In the event of termination of the Investment Management
Agreements, such termination shall have no effect on the liability of First
Banks with respect to obligations incurred before such termination. The
obligations of First Banks are joint and several with those of MVP. First Banks
does not have any recourse provisions that would enable it to recover from third
parties any amounts paid under the contracts nor does First Banks hold any
assets as collateral that, upon occurrence of a required payment under the
contract, could be liquidated to recover all or a portion of the amount(s) paid.
At June 30, 2007, First Banks had not recorded a liability for the obligations
associated with these guaranty contracts as the likelihood that First Banks will
be required to make payments under the contracts is remote.