Exhibit 10.1
REVOLVING CREDIT
AGREEMENT
Dated as of November 8, 2005
This Revolving Credit Agreement
(this “ Agreement ”) is by and between
CENTENNIAL BANK HOLDINGS, INC. , a corporation formed under
the laws of the State of Delaware (“ Borrower
”), and U.S. BANK NATIONAL ASSOCIATION , a national
banking association (“ Lender ”), with a banking
office at 777 East Wisconsin Avenue, Milwaukee, Wisconsin
53202.
SECTION 1.
LOANS
SECTION 1.1. [RESERVED
].
SECTION 1.2. REVOLVING
CREDIT LOANS . Subject to the terms and conditions of this
Agreement, Lender agrees to make loans to Borrower, from time to
time from the date of this Agreement through November 7, 2006
(the “ Maturity Date ”), at such times and in
such amounts, not to exceed SEVENTY MILLION AND NO/100 UNITED
STATES DOLLARS ($70,000,000.00) (the “ Commitment
”) at any one time outstanding, as Borrower may request (the
“ Loan(s) ”). During such period Borrower may
borrow, repay and reborrow hereunder. Each borrowing shall
(i) in the case of Loans that bear interest at the Prime Based
Rate or the Federal Funds Rate, be in the amount of at least
$100,000 or the remaining unused amount of the Commitment and
(ii) in the case of Loans that bear interest at LIBOR, shall
be in the amount of at least $1,000,000 or the remaining unused
amount of the Commitment.
SECTION 1.3. REVOLVING
CREDIT NOTE . The
Loans shall be evidenced by a promissory note (the “
Note ”), substantially in the form of Exhibit A
, with appropriate insertions, dated the date hereof, payable to
the order of Lender and in the original principal amount of the
Commitment. Lender may at any time and from time to time at
Lender’s sole option attach a schedule (grid) to the Note and
endorse thereon notations with respect to each Loan specifying the
date and principal amount thereof, the Interest Period (as defined
below) (if applicable), the applicable interest rate and rate
option, and the date and amount of each payment of principal and
interest made by Borrower with respect to each such Loan.
Lender’s endorsements as well as its records relating to the
Loans shall be rebuttably presumptive evidence of the outstanding
principal and interest on the Loans, and, in the event of
inconsistency, shall prevail over any records of Borrower and any
written confirmations of the Loans given by Borrower. The principal
of the Note shall be payable on or before the Maturity
Date.
SECTION 1.4. EXTENSION OF
MATURITY DATE . Borrower may request an extension of the
Maturity Date by submitting a request for an extension to Lender
(an “ Extension Request ”) no more than sixty
(60) days prior to the current Maturity Date. The Extension
Request must specify the new Maturity Date requested by Borrower
and the date (which must be at least thirty (30) days after
the Extension Request is delivered to Lender) as of which Lender
must respond to the Extension Request (the “ Extension
Date ”). The new Maturity Date shall be no more than 364
days after the Maturity Date in effect at the time the Extension
Request is received, including such Maturity Date as one of the
days in the calculation of the days elapsed. If Lender fails to
respond to an Extension Request by the Extension Date, Lender shall
be deemed to have denied the Extension Request. If Lender, in its
sole discretion, decides to
approve the Extension Request, Lender shall
deliver its written consent to Borrower and the Maturity Date
specified in the Extension Request shall become effective at the
expiration of the existing Maturity Date.
SECTION 2. INTEREST AND
FEES
SECTION 2.1. INTEREST
RATE . Borrower
agrees to pay interest on the unpaid principal amount of the Loans
from time to time outstanding hereunder at the following rates per
year:
(a) Before maturity of any Loan,
whether by acceleration or otherwise, at the option of Borrower,
subject to the terms hereof at a rate equal to:
(i) The “ Prime-Based
Rate ,” which shall mean the Prime Rate (as hereinafter
defined) minus seventy-five hundredths of one percent
(-0.75%) per annum;
(ii) “ LIBOR ,”
which shall mean the sum of (A) the 1, 2 or 3 month LIBOR rate
(which Interest Period Borrower shall select subject to the terms
stated herein) quoted by Lender from Telerate Page 3750 or any
successor thereto (which shall be the LIBOR rate in effect two New
York Banking Days prior to the commencement of the advance),
adjusted for any reserve requirement and any subsequent costs
arising from a change in government regulation, plus
(B) one and one-half percent (+1.50%) per annum;
or
(iii) “ Federal Funds
Rate ,” which shall mean the sum of (A) the weighted
average of the rates on overnight Federal funds transactions, with
members of the Federal Reserve System only, arranged by Federal
funds brokers, plus (B) one and one-half percent
(1.50%) per annum. The Federal Funds Rate shall be determined
by Lender on the basis of reports by Federal funds brokers to, and
published daily by, the Federal Reserve Bank of New York in the
Composite Closing Quotations for U.S. Government Securities. If
such publication is unavailable or the Federal Funds Rate is not
set forth therein, the Federal Funds Rate shall be determined on
the basis of any other source reasonably selected by Lender. The
Federal Funds Rate applicable each day shall be the Federal Funds
Rate reported as applicable to Federal funds transactions on that
date. In the case of Saturday, Sunday or a legal holiday, the
Federal Funds Rate shall be the rate applicable to Federal funds
transactions on the immediately preceding day for which the Federal
Funds Rate is reported.
(b) After the maturity of any Loan,
whether by acceleration or otherwise, such Loan shall bear interest
until paid at a rate equal to two percent (2%) in addition to
the rate in effect immediately prior to maturity (but not less than
the Prime-Based Rate in effect at maturity).
SECTION 2.2. RATE
SELECTION . Borrower shall select and change its selection
of the interest rate as among LIBOR, the Federal Funds Rate and the
Prime-Based Rate, as applicable, to apply to (a) at least
$1,000,000 and in integral multiples of $1,000,000 thereafter of
any Loan or portion thereof which bears interest at LIBOR, and
(b) at least $100,000 and in integral multiples of $100,000
thereafter of any Loan or portion thereof which
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bears interest at the Federal Funds Rate or the
Prime-Based Rate, in all cases subject to the requirements herein
stated:
(a) At the time any Loan is
made;
(b) At the expiration of a
particular LIBOR Interest Period selected for the outstanding
principal balance of any Loan or portion of any Loan currently
bearing interest at LIBOR; and
(c) At any time for the outstanding
principal balance of any Loan or portion thereof currently bearing
interest at the Prime-Based Rate or the Federal Funds
Rate.
SECTION 2.3. RATE CHANGES
AND NOTIFICATIONS .
(a) LIBOR . If Borrower
wishes to borrow funds at LIBOR or Borrower wishes to change the
rate of interest on any Loan or portion thereof, within the limits
described above, from any other rate to LIBOR, it shall, at or
before 12:00 noon, New York time, not less than two New York
Banking Days prior to the New York Banking Day on which such rate
is to take effect, give Lender written notice thereof, which shall
be irrevocable. Such notice shall specify the Loan or portion
thereof to which LIBOR is to apply, and, in addition, the desired
LIBOR Interest Period of 1, 2 or 3 months (but not to exceed the
Maturity Date). Notwithstanding that any LIBOR Interest Period
selected by Borrower may extend beyond the Maturity Date, Borrower
acknowledges and agrees that all amounts owing by Borrower to
Lender under this Agreement in respect of principal, accrued
interest, fees and expenses, including any amounts owing under
Section 2.5(c), shall be due and payable on the Maturity
Date.
(b) Federal Funds Rate or
Prime-Based Rate . If Borrower wishes to borrow funds at the
Federal Funds Rate or the Prime-Based Rate or to change the rate of
interest on any Loan or any portion thereof, to such rate, it
shall, at or before l2:00 noon, New York time, on the date such
borrowing or change is to take effect, which shall be a New York
Banking Day, give Lender written notice thereof, which shall be
irrevocable. Such notice shall specify the advance and the desired
interest rate option.
(c) Failure to Notify . If
Borrower does not notify Lender at the expiration of a selected
Interest Period with respect to any principal outstanding at LIBOR,
then in the absence of such notice Borrower shall be deemed to have
elected to have such principal accrue interest after the respective
LIBOR Interest Period at the Federal Funds Rate. If Borrower does
not notify Lender as to its selection of the interest rate option
with respect to any new Loan, then in the absence of such notice
Borrower shall be deemed to have elected to have such initial
advance accrue interest at the Federal Funds Rate.
SECTION 2.4.
INTEREST PAYMENT DATES .
Accrued interest shall be paid in
respect of each portion of principal to which the Federal Funds
Rate or Prime-Based Rate applies on the last day of each month in
each year, beginning with the first of such dates to occur after
the date of the first Loan or portion thereof, at maturity, and
upon payment in full, and to each portion of principal to which any
other interest rate option applies, the end of each respective
Interest Period, every three months, at maturity, and upon payment
in full, whichever is earlier or more frequent. After maturity,
interest shall be payable upon demand.
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SECTION 2.5.
ADDITIONAL PROVISIONS WITH RESPECT TO FEDERAL FUNDS
RATE AND LIBOR LOANS .
The selection by Borrower of the
Federal Funds Rate or LIBOR and the maintenance of the Loans or
portions thereof at such rate shall be subject to the following
additional terms and conditions:
(a) Availability of Deposits at a
Determinable Rate . If, after Borrower has elected to borrow or
maintain any Loan or portion thereof at the Federal Funds Rate or
LIBOR, Lender notifies Borrower that:
(i) United States dollar deposits in
the amount and for the maturity requested are not available to
Lender (in the case of LIBOR, in the London interbank market);
or
(ii) Reasonable means do not exist
for Lender to determine the Federal Funds Rate or LIBOR for the
amount and maturity requested; all as determined by Lender in its
sole discretion, then the principal subject to the Federal Funds
Rate or LIBOR shall accrue or shall continue to accrue interest at
the Prime-Based Rate.
(b) Prohibition of Making,
Maintaining, or Repayment of Principal at the Federal Funds Rate or
LIBOR . If any treaty, statute, regulation, interpretation
thereof, or any directive, guideline, or otherwise by a central
bank or fiscal authority (whether or not having the force of law)
shall either prohibit or extend the time at which any principal
subject to the Federal Funds Rate or LIBOR may be purchased,
maintained, or repaid, then on and as of the date the prohibition
becomes effective, the principal subject to that prohibition shall
continue at the Prime-Based Rate.
(c) Payments of Principal and
Interest to be Inclusive of Any Taxes or Costs . All payments
of principal and interest shall include any taxes and costs
incurred by Lender resulting from having principal outstanding
hereunder at the Federal Funds Rate or LIBOR. Without limiting the
generality of the preceding obligation, illustrations of such taxes
and costs are:
(i) Taxes (or the withholding of
amounts for taxes) of any nature whatsoever including income,
excise, and interest equalization taxes (other than income taxes
imposed by the United States or any state or locality thereof on
the income of Lender), as well as all levies, imposts, duties, or
fees whether now in existence or resulting from a change in, or
promulgation of, any treaty, statute, regulation, interpretation
thereof, or any directive, guideline, or otherwise, by a central
bank or fiscal authority (whether or not having the force of law)
or a change in the basis of, or time of payment of, such taxes and
other amounts resulting therefrom;
(ii) Any reserve or special deposit
requirements against assets or liabilities of, or deposits with or
for the account of, Lender with respect to principal outstanding at
LIBOR including those imposed under Regulation D of the Federal
Reserve Board or resulting from a change in, or the promulgation
of, such requirements by
4
treaty, statute, regulation,
interpretation thereof, or any directive, guideline, or otherwise
by a central bank or fiscal authority (whether or not having the
force of law);
(iii) Any other costs resulting from
compliance with treaties, statutes, regulations, interpretations,
or any directives or guidelines, or otherwise by a central bank or
fiscal authority (whether or not having the force of law),
including capital adequacy regulations;
(iv) Any loss (including loss of
anticipated profits) or expense incurred by reason of the
liquidation or re-employment of deposits acquired by
Lender:
(A) To make Loans or a portion
thereof or maintain principal outstanding at the LIBOR or the
Federal Funds Rate;
(B) As the result of a voluntary
prepayment at a date other than the Interim Maturity Date selected
for principal outstanding at LIBOR;
(C) As the result of a mandatory
repayment at a date other than that Interim Maturity Date selected
for principal outstanding at LIBOR as the result of the occurrence
of an Event of Default and the acceleration of any portion of the
indebtedness hereunder; or
(D) As the result of a prohibition
on making, maintaining, or repaying principal outstanding at the
Federal Funds Rate or LIBOR.
If Lender incurs any such taxes or
costs, Borrower, upon demand in writing specifying such taxes and
costs, shall promptly pay them; save for manifest error
Lender’s specification shall be presumptively deemed
correct.
SECTION 2.6. BASIS OF
COMPUTATION . Interest shall be computed for the actual number
of days elapsed on the basis of a year consisting of 360 days,
including the date a Loan is made and excluding the date a Loan or
any portion thereof is paid or prepaid.
SECTION 2.7. COMMITMENT
FEE, REDUCTION OF COMMITMENT . Borrower agrees to pay Lender a commitment fee
(the “ Commitment Fee ”) in arrears of
twenty-five hundredths of one percent (0.25%) per year on the
average daily unused amount of the Commitment. The Commitment Fee
shall commence to accrue on the date of this Agreement and shall be
paid on the last day of each calendar quarter in each year,
beginning with the first of such dates to occur after the date of
this Agreement, at maturity and upon payment in full. At any time
or from time to time, upon at least ten days’ prior written
notice, which shall be irrevocable, Borrower may reduce the
Commitment in the amount of at least $1,000,000 or in full;
provided that Borrower may not reduce the Commitment below an
amount equal to the aggregate outstanding principal amount of all
Loans. Upon any such reduction of any part of the unused
Commitment, any accrued and unpaid Commitment Fee on the part
reduced shall be paid in full as of the date of such
reduction.
5
SECTION 3. PAYMENTS AND
PREPAYMENTS
SECTION 3.1.
PREPAYMENTS . Borrower may prepay without penalty or premium
any principal bearing interest at the Prime-Based Rate or the
Federal Funds Rate. If a LIBOR Loan is prepaid prior to the end of
the Interest Period for such loan, whether voluntarily or because
prepayment is required due to the Note maturing or due to
acceleration of the Note upon default or otherwise, Borrower agrees
to pay all of Lender’s costs, expenses and Interest
Differential (as determined by Lender) incurred as a result of such
prepayment. The term “ Interest Differential ”
shall mean that sum equal to the greater of zero or the financial
loss incurred by Lender resulting from prepayment, calculated as
the difference between the amount of interest Lender would have
earned (from like investments in the Money Markets as of the first
day of the LIBOR Loan) had prepayment not occurred and the interest
Lender will actually earn (from like investments in the Money
Markets as of the date of prepayment) as a result of the
redeployment of funds from the prepayment. Because of the
short-term nature of each such loan, Borrower agrees that the
Interest Differential shall not be discounted to its present value.
Any partial repayment or prepayment of Loans which bear interest at
LIBOR shall be in a minimum amount of $1,000,000 (or if less, the
outstanding principal balance of the Loans) and any partial
repayment or prepayment of Loans which bear interest at the Federal
Funds Rate or the Prime-Based Rate shall be in a minimum amount of
$100,000 (or if less, the outstanding principal balance of the
Loans).
SECTION 3.2. FUNDS
. All payments of
principal, interest and the Commitment Fee shall be made in
immediately available funds to Lender at its banking office
indicated above or as otherwise directed by Lender.
SECTION 4. REPRESENTATIONS AND
WARRANTIES
To induce Lender to make each of the
Loans, Borrower represents and warrants to Lender that:
SECTION 4.1.
ORGANIZATION . Borrower is existing and in good standing as a
duly qualified and organized bank holding company. Borrower and
each Subsidiary (as hereinafter defined) are existing and in good
standing under the laws of their jurisdiction of formation, and are
duly qualified, in good standing and authorized to do business in
each jurisdiction where failure to do so might have a material
adverse impact on the consolidated assets, condition or prospects
of Borrower. Borrower and each Subsidiary have the power and
authority to own their properties and to carry on their businesses
as now being conducted.
SECTION 4.2. AUTHORIZATION;
NO CONFLICT . The
execution, delivery and performance of this Agreement, the Pledge
Agreement, the Note and all related documents and instruments:
(a) are within Borrower’s powers; (b) have been
authorized by all necessary corporate action; (c) have
received any and all necessary governmental approvals; and
(d) do not and will not contravene or conflict with any
provision of law or charter or by-laws of Borrower or any agreement
affecting Borrower or its property. This Agreement and the Pledge
Agreement are, and the Note when executed and delivered will be,
legal, valid and binding obligations of Borrower, enforceable
against Borrower in accordance with their respective
terms.
6
SECTION 4.3. FINANCIAL
STATEMENTS . Borrower has supplied to Lender copies of its
audited consolidated financial statements as of and for the twelve
month period ended December 31, 2004. Such statements have
been furnished to Lender, have been prepared in conformity with
generally accepted accounting principles applied on a basis
consistent with that of the preceding fiscal year, except as
disclosed in such statements, and fairly present the financial
condition of Borrower and its Subsidiaries as at such dates and the
results of their operations for the respective periods then ended.
Since the date of those financial statements, no material, adverse
change in the business, condition, properties, assets, operations,
or prospects of Borrower or its Subsidiaries has occurred except as
disclosed on Schedule 4.3 . There is no known
contingent liability of Borrower or any Subsidiary which is known
to be in an amount that is more than $5,000,000 (excluding loan
commitments, letters of credit, and other contingent liabilities
incurred in the ordinary course of the banking business) in excess
of insurance for which the insurer has confirmed coverage in
writing which is not reflected in such financial statements or
disclosed on Schedule 4.3 .
SECTION 4.4. TAXES
. Borrower and each
Subsidiary have filed or caused to be filed all federal, state and
local tax returns which, to the knowledge of Borrower or such
Subsidiary, are required to be filed, and have paid or have caused
to be paid all taxes as shown on such returns or on any assessment
received by them, to the extent that such taxes have become due
(except for current taxes not delinquent and taxes being contested
in good faith and by appropriate proceedings for which adequate
reserves have been provided on the books of Borrower or the
appropriate Subsidiary, and as to which no foreclosure, sale or
similar proceedings have been commenced).
SECTION 4.5. LIENS
. None of the assets
of Borrower or any Subsidiary are subject to any mortgage, pledge,
title retention lien, or other lien, encumbrance or security
interest except: (a) for current taxes not delinquent or taxes
being contested in good faith and by appropriate proceedings;
(b) for liens arising in the ordinary course of business for
sums not due or sums being contested in good faith and by
appropriate proceedings, but not involving any deposits or loan or
portion thereof or borrowed money or the deferred purchase price of
property or services; (c) to the extent specifically shown in
the financial statements referred to in Section 4.3 ;
(d) for liens in favor of Lender; and (e) liens and
security interests securing deposits of public funds, repurchase
agreements, Federal funds purchased, trust assets, advances from a
Federal Home Loan Bank, discount window borrowings from a Federal
Reserve Bank and other similar liens granted in the ordinary course
of the banking business.
SECTION 4.6. ADVERSE
CONTRACTS . Neither Borrower nor any Subsidiary is a party
to any agreement or instrument or subject to any charter or other
corporate restriction, nor is it subject to any judgment, decree or
order of any court or governmental body, which may have a material
and adverse effect on the business, assets, liabilities, financial
condition, operations or business prospects of Borrower and its
Subsidiaries taken as a whole or on the ability of Borrower to
perform its obligations under this Agreement, the Pledge Agreement
and the Note. Neither Borrower nor any Subsidiary has, nor with
reasonable diligence should have had, knowledge of or notice that
it is in default in the performance, observance or fulfillment of
any of the obligations, covenants or conditions contained in any
such agreement, instrument, restriction, judgment, decree or
order.
7
SECTION 4.7. REGULATION
U . Borrower is
not engaged principally in, nor is one of Borrower’s
important activities, the business of extending credit for the
purpose of purchasing or carrying “margin stock” within
the meaning of Regulation U of the Board of Governors of the
Federal Reserve System as now and from time to time hereinafter in
effect.
SECTION 4.8. LITIGATION AND
CONTINGENT LIABILITIES . No litigation (including derivative actions),
arbitration proceedings or governmental proceedings are pending or,
to Borrower’s knowledge, threatened against Borrower which
would (singly or in the aggregate), if adversely determined, have a
material and adverse effect on the consolidated assets, financial
condition, continued operations or business of Borrower and its
Subsidiaries, except as and if set forth (including estimates of
the dollar amounts involved) in Schedule 4.8
.
SECTION 4.9. FDIC
INSURANCE . The
deposits of each Subsidiary Bank of Borrower are insured by the
FDIC and no act has occurred which would adversely affect the
status of such Subsidiary Bank as an FDIC insured bank.
SECTION 4.10.
INVESTIGATIONS . Neither Borrower nor any Subsidiary Bank is
under investigation by, or is operating under the restrictions
imposed by or agreed to in connection with, any regulatory
authority, other than routine examinations by regulatory
authorities having jurisdiction over Borrower or such Subsidiary
Bank.
SECTION 4.11.
SUBSIDIARIES . Attached hereto as Schedule 4.11 is
a correct and complete list of all Subsidiaries of
Borrower.
SECTION 4.12. BANK HOLDING
COMPANY . Borrower has complied in all material respects
with all federal, state and local laws pertaining to bank holding
companies, including without limitation the Bank Holding Company
Act of 1956, as amended, and to the best of its knowledge there are
no conditions to its engaging in the business of being a registered
bank holding company.
SECTION 4.13.
ERISA .
(a) Borrower and the ERISA
Affiliates and the plan administrator of each Plan (other than a
Multiemployer Plan) have fulfilled in all material respects their
respective obligations under ERISA and the Code with respect to
such Plan and such Plan is currently in substantial compliance with
the applicable provisions of ERISA and the Code.
(b) With respect to each Plan, there
has been no (i) “reportable event” within the
meaning of Section 4043 of ERISA and the regulations
thereunder which is not subject to the provision for waiver of the
30-day notice requirement to the PBGC; (ii) failure by
Borrower or any ERISA Affiliate to timely make or properly accrue
any contribution which is due to any Plan; (iii) action under
Section 4041(c) of ERISA to terminate any Pension Plan;
(iv) action under Section 4041(b) of ERISA to terminate
any Pension Plan which could require Borrower to incur a liability
or obligations to make a material contribution to such Pension
Plan; (v) withdrawal from any Pension Plan with two or more
contributing sponsors or the termination of any such Pension Plan
that could subject the Borrower to material liability pursuant to
Section 4063 or 4064 of ERISA;
8
(vi) institution by PBGC of
proceedings to terminate any Pension Plan, or the occurrence of any
event or condition which might constitute grounds under ERISA for
the termination of, or the appointment of a trustee to administer,
any Pension Plan (other than a Multiemployer Plan); (vii) the
imposition on Borrower or any ERISA Affiliate of liability pursuant
to Sections 4062(e), 4069 or 4212 of ERISA;
(viii) complete or partial withdrawal (within the meaning of
Sections 4203 and 4205 of ERISA) by Borrower or any ERISA
Affiliate from any Pension Plan which is a Multiemployer Plan that
is in reorganization or insolvency pursuant to Sections 4241
or 4245 of ERISA, or that has terminated under Sections 4041A
or 4042 of ERISA; (ix) prohibited transaction described in
Section 406 of ERISA or 4975 of the Code which could subject
Borrower to the imposition of any material fines, penalties, taxes
or related charges imposed by either Section 4975 of the Code
or Section 502(i) of ERISA; (x) material pending claim
(other than routine claims for benefits) against any Plan (other
than a Multiemployer Plan) which could reasonably be expected to
result in material liability; (xi) receipt from the Internal
Revenue Service of notice of the failure of any Plan (other than a
Multiemployer Plan) to qualify under Section 401(a) of the
Code, or the failure of any trust forming part of any Plan (other
than a Multiemployer Plan) to fail to qualify for exemption from
taxation under Section 501(a) of the Code, if applicable; or
(xii) imposition of a lien pursuant to Section 401(a)(29)
or 412(n) of the Code or Section 302(f) of ERISA.
SECTION 4.14. ENVIRONMENTAL
LAWS .
(a) Borrower and each of its
Subsidiaries have obtained all permits, licenses and other
authorizations which are required to be obtained by Borrower or
such Subsidiaries, as the case may be, under all Environmental Laws
and are in compliance in all material respects with any applicable
Environmental Laws.
(b) Borrower has not received any
notice, demand, request for information, citation, summons, order
or complaint, no penalty has been assessed and no investigation or
review is pending or, to Borrower’s knowledge, threatened by
any governmental agency or other Person, in each case, with respect
to any alleged or suspected failure by Borrower or any of its
Subsidiaries to comply in any material respect with any
Environmental Laws.
(c) There are no material liens
arising under or pursuant to any Environmental Laws on any of the
property owned or, to Borrower’s knowledge, leased by
Borrower or any of its Subsidiaries.
(d) There are no conditions existing
currently or, to Borrower’s knowledge, likely to exist during
the term of this Agreement which would subject Borrower or any of
its Subsidiaries or any of their owned property or, to
Borrower’s knowledge, any of their leased property, to any
material lien, damages, penalties, injunctive relief or cleanup
costs under any Environmental Laws or which require or are
reasonably likely to require cleanup, removal, remedial action or
other responses pursuant to Environmental Laws by Borrower and its
Subsidiaries.
SECTION 4.15. PLEDGED
SHARES . The
Pledged Shares (as hereinafter defined) constitute 100% of the
issued and outstanding capital stock of Guaranty Bank and
Trust
9
Company, have been duly authorized and validly
issued and are fully paid and non-assessable. Borrower owns the
Pledged Shares free and clear of all other interests, liens or
encumbrances of any nature whatsoever, other than liens in favor of
Lender.
SECTION 5.
COVENANTS
Until all obligations of Borrower
hereunder, under the Pledge Agreement, the Note and all other
related documents and instruments are paid and fulfilled in full,
Borrower agrees that it shall, and shall cause each Subsidiary to,
comply with the following covenants, unless Lender consents
otherwise in writing:
SECTION 5.1. EXISTENCE,
MERGERS, ETC . Borrower and each Subsidiary shall preserve and
maintain their respective corporate, partnership or joint venture
(as applicable) existence, rights, franchises, licenses and
privileges, and will not liquidate, dissolve, or merge, or
consolidate with or into any other entity, or sell, lease, transfer
or otherwise dispose of all or a substantial part of their assets
other than in the ordinary course of business as now conducted,
except that:
(a) Any Subsidiary may merge or
consolidate with or into Borrower or any one or more wholly-owned
Subsidiaries;
(b) Any Subsidiary may sell, lease,
transfer or otherwise dispose of any of its assets to Borrower or
one or more wholly-owned Subsidiaries;
(c) Collegiate Peaks Bank may
(i) merge or consolidate with any other Person,
(ii) sell, lease, transfer or otherwise dispose of its assets
to another Person or (iii) liquidate or dissolve or Borrower
may sell all of the capital stock of Collegiate Peaks Bank in a
transaction for cash;
(d) Any Insignificant Subsidiary may
(i) merge or consolidate with any other Person,
(ii) sell, lease, transfer or otherwise dispose of its assets
to another Person or (iii) liquidate or dissolve (“
Insignificant Subsidiary ” means a Subsidiary with
(1) net income that is less than 2.5% of the consolidated net
income of Borrower and its Subsidiaries for the most recent fiscal
quarter ended for which a consolidated income statement of Borrower
is available and (2) tangible assets that are less than 2.5%
of consolidated tangible assets of Borrower and its Subsidiaries as
of the end of the most recent fiscal quarter ended for which a
consolidated balance sheet of Borrower is available);
and
(e) Any Subsidiary may merge or
consolidate with any other Person provided that (i) the
surviving entity is a Subsidiary of Borrower (ii) before and
after giving effect to such merger or consolidation, no Event of
Default or Unmatured Event of Default exists or is continuing,
(iii) following such merger or consolidation, Borrower shall
continue to own the same or greater percentage of the stock or
other ownership interests of such Subsidiary as it owned
immediately prior to such merger or consolidation, (iv) after
giving effect to such merger or consolidation, Borrower is in pro
forma compliance with Section 5.4 of this Agreement and
(v) if any Subsidiary who is a party to such merger or
consolidation is a Subsidiary whose shares of capital stock
constitute Pledged Shares
10
under the Pledge Agreement, then
after giving effect to such merger or consolidation, Lender shall
continue to have a perfected first priority security interest in
such Pledged Shares; provided, however, this clause (e)
shall not apply to any Insignificant Subsidiary.
Borrower and each Subsidiary shall
take all steps to become and remain duly qualified, in good
standing and authorized to do business in each jurisdiction where
failure to do so might have a material adverse impact on the
consolidated assets, condition or prospects of Borrower.
SECTION 5.2. REPORTS,
CERTIFICATES AND OTHER INFORMATION .
Borrower shall furnish (or cause to
be furnished) to Lender:
(a) Interim Reports . Within
forty-five (45) days after the end of each quarter of each
fiscal year of Borrower, a copy of an unaudited financial statement
of Borrower and its Subsidiaries prepared on a consolidated basis
consistent with the consolidated financial statements of Borrower
and its Subsidiaries referred to in Section 4.3 above
and prepared in accordance with generally accepted accounting
principles, signed by an authorized officer of Borrower and
consisting of at least: (i) a balance sheet as at the close of
such quarter; and (ii) a statement of earnings and source and
application of funds for such quarter and for the period from the
beginning of such fiscal year to the close of such
quarter.
(b) Annual Report . Within
ninety (90) days after the end of each fiscal year of
Borrower, a copy of an annual report of Borrower and its
Subsidiaries prepared on a consolidated basis and in conformity
with generally accepted accounting principles applied on a basis
consistent with the consolidated financial statements of Borrower
and its Subsidiaries referred to in S
