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LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is made
as of this 1st day of February, 2007, by and between STIFEL
FINANCIAL CORP., a Delaware corporation (the "Borrower"), and the
MAYOR AND CITY COUNCIL OF BALTIMORE, a body politic and corporate
and a political subdivision of the State of Maryland, by and
through the DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT, c/o
CITY OF BALTIMORE DEVELOPMENT CORPORATION ("BDC"), its successors
and assigns (the "Lender").
R E C I T A L S
1. The Borrower has applied to the Lender for a
term loan (the "Loan") in the principal amount of $750,000.00 (the
"Principal Amount"), and the Lender is willing to accommodate the
Borrower upon and subject to the terms, conditions, and provisions
of this Agreement.
NOW, THEREFORE, in consideration of the
premises, the parties hereto agree as follows:
The Recitals are hereby incorporated as a part
of this Agreement.
All accounting
terms not specifically defined herein shall have the meanings
assigned to them as determined by generally acceptable accounting
principles in the United States of America, consistently applied.
Unless the context otherwise requires, when used herein, the
following terms shall have the following meanings:
2.1. "Events of
Default" means those events set forth in Section 7 hereof.
2.2. "Expense
Payment" means a payment advanced by the Lender pursuant to the
provisions of Section 6.10 hereof, each such payment being called
an "Expense Payment" and collectively the "Expense Payments."
2.3.
"Liabilities" means the obligation of the Borrower to pay (a) the
unpaid principal amount of the Note, plus all accrued and unpaid
interest thereon, (b) all other charges, interest, and expenses
chargeable by the Lender to the Borrower under this Agreement and
the other Loan Documents.
2.4. "Lien"
means any mortgage, deed of trust, pledge, security interest,
assignment, encumbrance, lien, or charge of any kind, including,
without limitation, any conditional sale or other title retention
agreement, any lease in the nature thereof, and the filing of or
agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction.
2.5.
"Liquidation Costs" means all expenses, charges, costs, and fees
(including, without limitation, attorneys' fees and expenses) of
any nature whatsoever paid or incurred by or on behalf of the
Lender in connection with (a) the collection or enforcement of any
of the Liabilities and (b) the collection or enforcement of any of
the Loan Documents.
2.6. "Loan" has the meaning set forth in the
Recitals.
2.7. "Loan
Documents" means collectively the Note, this Agreement, and any
other instrument, document, and agreement now and hereafter
evidencing, securing, guarantying, indemnifying, and given by the
Borrower or any third party in connection with the Loan or any of
the other Liabilities (including those documents set forth in
Section 4.1 hereof) and any and all amendments thereto and
modifications thereof.
2.8. "Note" means that Promissory Note described
in Section 3.2 hereof and any and all amendments thereto and
modifications thereof.
2.9. "Person"
includes a corporation, an association, a partnership, an
organization, a business, an individual, or a government or
political subdivision thereof or governmental agency.
2.10. " Stifel,
Nicolaus" means Stifel, Nicolaus & Company, Incorporated, a
subsidiary of the Borrower.
2.11. "Taxes"
means all taxes and assessments whether general or special,
ordinary or extraordinary, or foreseen or unforeseen, of every
character (including all penalties or interest thereon), which at
any time may be assessed, levied, confirmed, or imposed on the
Borrower or any of its properties or assets or any part thereof or
in respect of any of its franchises, businesses, income, or
profits, and all claims for sums which by law have or might have
become a lien or charge upon any of its properties or assets.
3.1.
Purpose . The proceeds of the Loan shall be contributed by
Borrower to Stifel, Nicolaus, which shall use such amounts to
construct leasehold improvement, purchase machinery and equipment
and for related matters at its leasehold premises at 1 South Street
located in Baltimore City (the "Work").
3.2. Loan
. The Loan shall be evidenced and repaid in accordance with the
terms of the Note to the Lender, of even date herewith, duly
executed by the Borrower, and of the Proposal Letter which is
incorporated herein. To the extent any of the terms and provisions
of this Agreement conflict with any of the terms and conditions of
the Proposal Letter, this Agreement controls.
4.1.
Conditions Precedent to the Loan . The obligation of the
Lender to make the Loan is subject to the following express
conditions precedent:
A. Loan Documents . The Borrower shall
have delivered to the Lender the following:
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1. Note . The executed Note;
2. Borrower's Incumbency Certificate . A
certificate as to the incumbency and signatures of the officers of
the Borrower signing the Loan Documents;
3. Borrower's Consent . A certified copy
of resolutions of the Board of Directors of the Borrower
authorizing the execution, delivery, and performance of this
Agreement, the Notes, and the other Loan Documents;
4. Borrower's Organizational Documents .
A certified copy of the Borrower's articles of incorporation and
by-laws;
5. Miscellaneous . Such other documents,
instruments, opinions, and agreements as the Lender and its counsel
may require in their discretion.
B. Lender's Counsel . All legal matters
incident to this Agreement shall be satisfactory to counsel for the
Lender, and the Borrower shall have reimbursed the Lender for the
reasonable fees and expenses of Lender's counsel in connection with
the preparation of this Agreement and all matters incident
thereto.
To induce the Lender to make the Loan hereunder,
the Borrower hereby makes the following representations and
warranties to the Lender:
5.1. Good
Standing . The Borrower (a) is a corporation duly organized,
existing, and in good standing under the laws of the State of
Delaware, and (b) has the power to own its property and to carry on
its business and is qualified to do business and is in good
standing in each jurisdiction in which the character of properties
owned by it or the transaction of its business makes such
qualification necessary, except where the failure to be so
qualified would not have a material adverse effect on Borrower's
ability to comply with its obligations under this Agreement.
5.2.
Authority . The Borrower has full power and authority to
enter into this Agreement, to make the borrowings hereunder, to
execute and deliver the Note and the other Loan Documents to which
it is a party, and to perform and comply with the terms,
conditions, and agreements set forth herein and therein, all of
which have been duly authorized by all proper and necessary
corporate action of the Borrower. No consent or approval of the
members of the Borrower or of any governmental authority is
required as a condition to the validity of this Agreement, the
Note, or the other Loan Documents.
5.3. Binding
Agreement . This Agreement constitutes, and the Note and the
other Loan Documents constitute or will constitute when issued and
delivered for value received, the valid and legally binding
obligations of the Borrower enforceable in accordance with their
respective terms, except as may be limited by or subject to any
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and
subject to general principles of equity.
5.4.
Litigation . There are no proceedings pending or, so far as
any person signing below as or on behalf of the Borrower knows,
threatened before any court or administrative agency which will
materially adversely affect the financial condition or operations
of the Borrower.
5.5. No
Conflicting Agreements . There are no provisions of the
Borrower's charter and bylaws and no provisions of any existing
mortgage, deed of trust, indenture, contract, lease, or agreement
binding on the Borrower or affecting its property which would
conflict with or in any way prevent the execution, delivery, or
carrying out of the terms of this Agreement, the Note, or the other
Loan Documents.
5.6.
Financial Condition . The Borrower's financial statements,
copies of which have been furnished to the Lender, were prepared in
accordance with generally accepted accounting principles in the
United States of America consistently applied and are complete and
correct and fairly and accurately present the financial condition
of the Borrower as of their date and the results of its operations
for the period then ended. There has been no material adverse
change in the financial condition of the Borrower or the results of
its operations since the date of such financial statements.
5.7.
Information . All information contained in any financial
statement, application, schedule, report, certificate, opinion, or
any other document given by the Borrower or by any other person in
connection with the Loan or with any of the Loan Documents is in
all material respects true and accurate, and the Borrower or such
other person has not omitted to state any material fact or any
facts necessary to make such information not materially
misleading.
5.8. Assets
and Properties . The Borrower has good and merchantable title
to all of its assets and properties, except the real property
locations where it does business, including the Premises, which
such locations are leased to the Borrower pursuant to valid leases,
and there are no Liens against the Borrower outstanding against any
of these assets and properties.
5.9.
Taxes . All Taxes imposed upon the Borrower and its
properties, operations, and income have been paid and discharged
prior to the date when any interest or penalty would accrue for the
nonpayment thereof except for those Taxes being contested in good
faith and by appropriate proceedings by the Borrower.
5.10.
Violation of Laws, etc . Neither the consummation of the
Loan nor the use, directly or indirectly, of all or any portion of
the proceeds of the Loan hereunder will violate or result in a
violation of any provision of any applicable statute, regulation or
order of, or any restriction imposed by, the United States of
America or by any authorized official, board, department,
instrumentality, or agency thereof.
5.11.
Commercial Purpose . The Loan is being used strictly for
commercial purposes as set forth in the Commercial Law Article of
the Annotated Code of Maryland, as amended from time to time.
5.12.
Existence of Defaults . The Borrower is not in default upon
any of its existing indebtedness or under any agreement or
obligation under which the Borrower may be bound, nor will the
Borrower's entering into this Agreement or any other Loan Document
(in and of itself) immediately or with the passage of time, the
giving of notice, or both, cause the Borrower to violate or be in
default under any other agreements or obligations.
5.13. Status
of Borrower . The Borrower is a Delaware corporation duly
organized, validly existing and in good standing under the laws of
the State of Delaware and its operations and affairs have been
effectively and validly commenced. The Borrower has the power to
own its properties, conduct its business and affairs, and enter
into the Loan and perform the obligations thereunder. The
Borrower's entry in the Loan with the Lender has been validly and
effectively approved by its Board of Directors as may be required
by its organization documents, and any applicable laws. All copies
of the consent and incumbency certificates of the Borrower
delivered to the Lender in connection with this Loan Agreement are
true, accurate, and complete and no action has been taken in
diminution or abrogation thereof.
Until payment in full of all of the
Liabilities:
6.1. Use of
Loan Proceeds . The Borrower will use the proceeds of the Loan
only as set forth in this Agreement.
6.2. Annual
Financials . Within 120 days after the end of each calendar
year (or fiscal year if different from the calendar year), if
requested by the Lender, the Borrower will furnish promptly to the
Lender audited financial statements of the Borrower prepared by an
independent Certified Public Accountant in accordance with
generally accepted accounting principles, including balance sheet,
statement of income, statement of shareholder equity and statement
of changes in financial position, certified by independent
certified public accountants satisfactory to the Lender.
6.3. Other
Information . The Borrower will furnish to the Lender, promptly
from time to time, such information concerning the operations,
business, affairs, and financial condition of the Borrower as the
Lender may reasonably request.
6.4. Books,
Records, and Inspections . The Borrower will at all times (a)
maintain complete and accurate books and records and (b) permit any
person designated by the Lender, to enter, examine, audit, and
inspect all properties, books, operations, and records of the
Borrower at any reasonable time and from time to time, during
normal business hours after reasonable prior notice to Borrower,
wherever such properties, books, and records are located.
6.5.
Litigation . The Borrower will promptly notify the Lender of
any litigation instituted or threatened against its Baltimore
operations and of the entry of any judgment of Lien against its
Baltimore operations or its Baltimore assets or properties which
would be required to be described or included in any filing by the
Borrower with the Securities and Exchange Commission.
6.6.
Preservation of Properties . The Borrower will at all times
(a) maintain its properties, whether owned or leased, in good
operating condition, and from time to time will make all proper
repairs, renewals, replacements, additions, and improvements
thereto needed to maintain such properties in good operating
condition, (b) comply with the provisions of all material leases to
which it is a party or under which it occupies property so as to
prevent any loss of forfeiture thereof or thereunder, and (c)
comply with all laws, rules, regulations, and orders applicable to
the properties or any part thereof; provided, however, that nothing
contained in this section shall require the making of any repair,
renewal, replacement, addition, or improvement of or to a
particular property or the continued maintenance of any property
which would not be required in the exercise of sound business
judgment.
6.7. Workers'
Compensation Insurance . If applicable, Borrower, shall
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