EXHIBIT 10.13
COLLATERAL PLEDGE AGREEMENT
THIS AGREEMENT is entered into as of November 19, 2003, between BLUE
RIVER BANCSHARES, INC., an Indiana corporation ("DEBTOR"), and UNION FEDERAL
BANK OF INDIANAPOLIS, as the "SECURED PARTY".
Debtor and Secured Party have entered into the Credit Agreement (as
renewed, extended, amended, or restated from time to time, the "CREDIT
AGREEMENT") dated as of November 19, 2003. As a continuing inducement to the
Secured Party to extend credit to Debtor under the Credit Agreement, and as a
condition precedent to that credit, Debtor is executing and delivering this
agreement for the benefit of Secured Party.
ACCORDINGLY, for adequate and sufficient consideration, Debtor and
Secured Party agree as follows:
SECTION 13
DEFINITIONS AND REFERENCES
UNLESS STATED OTHERWISE, (A) TERMS DEFINED IN THE CREDIT AGREEMENT OR
THE UCC (AS HEREINAFTER DEFINED) HAVE THE SAME MEANINGS WHEN USED IN THIS
AGREEMENT, AND (B) TO THE EXTENT PERMITTED BY LAW, IF IN CONFLICT (I) THE
DEFINITION OF A TERM IN THE CREDIT AGREEMENT CONTROLS OVER THE DEFINITION OF
THAT TERM IN THE UCC, AND (II) THE DEFINITION OF A TERM IN ARTICLE 9 OF THE UCC
CONTROLS OVER THE DEFINITION OF THAT TERM ELSEWHERE IN THE UCC.
(a) COLLATERAL is defined in SECTION 2.2 of this
agreement.
(b) CONSTITUENT DOCUMENTS means, with respect to any
Person, its articles or certificate of incorporation, charter, bylaws,
certificates of limited partnership, partnership AGREEMENTS, limited
liability Borrower agreements, organizational documents, and such other
documents as may govern such Person's formation or organization.
(c) DEBTOR is defined in the preamble to this agreement
and includes, without limitation, Debtor, DEBTOR as a
debtor-in-possession, and any receiver, trustee, liquidator,
conservator, custodian, or similar party appointed for Debtor or for
substantially all of Debtor's assets under any Debtor Relief Law (as
defined in the Guaranty).
(d) EVENT OF DEFAULT means the occurrence of any one or
more of the following: (a) any Event of Default specified in the Credit
Agreement; (b) the failure or refusal of Debtor to punctually and
properly observe, keep, and perform any covenant, agreement, or
undertaking contained in this agreement; or (c) the Liens granted
hereby shall ever become unenforceable, or cease to be perfected, first
priority Liens.
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(e) INVESTMENT PROPERTY shall have the meaning set forth
in Section 9-102(a)(49) of the UCC.
(f) OBLIGOR means any Person obligated with respect to
any Collateral (whether as an ACCOUNT DEBTOR, obligor on an instrument,
issuer of securities, or otherwise).
(g) PLEDGED SECURITIES is defined in SECTION 2.2 of this
agreement.
(h) SECURED PARTY IS defined in the preamble to this
agreement.
(i) SECURITY INTEREST means the security interest granted
and the pledge and assignment made UNDER SECTION 2.1 of this agreement,
which is a Lien in favor of Secured Party.
(j) UCC means the Uniform Commercial Code as enacted in
the State of Indiana or other applicable jurisdiction, as amended at
the time in question.
SECTION 14
SECURITY INTEREST AND COLLATERAL
Section 14.1 SECURITY INTEREST. To secure the full payment and
performance of the Obligations, Debtor grants to Secured Party a security
interest in the Collateral and pledges and assigns the Collateral to the Secured
Party, all upon and subject to the terms and conditions of this agreement. The
grant of the Security Interest does not subject the Secured Party to the terms
of any Collateral or in any way transfer, modify, or otherwise affect any of
Debtor's obligations with respect to any Collateral or the Lien in favor of
Secured Party under the Credit Agreement.
Section 14.2 COLLATERAL. As used in this agreement, the term
"Collateral" means the present and future items and types of property described
below, whether now owned or acquired in the future by Debtor, and wherever
located.
(a) All present and future shares of stock or other
ownership interests (the "BANK SECURITIES") issued by Shelby County
Bank, a federal savings bank and Unified Banking Company, a federal
savings bank (the "BANK SUBSIDIARIES") and the certificates
representing the Bank Securities, and all cash, Investment Property,
dividends, increases, distributions, and profits received or receivable
therefrom, or in connection therewith, including distributions or
payments in partial or complete liquidation or redemption, or as a
result of reclassifications, readjustments, reorganizations, or changes
in the capital structure of the Bank Subsidiaries thereof, and any
other property, at any time and from time to time received, receivable,
or otherwise distributed or delivered in respect of or in exchange for
any of the Bank Securities to Secured Party, and all rights and
privileges pertaining thereto and all present and future cash and
noncash proceeds thereof; and
(b) All securities hereafter delivered to Secured Party
in substitution for, or in addition to, any of the foregoing, all
certificates representing or evidencing such securities, and all cash,
securities, instruments, documents, dividends, increases,
DISTRIBUTIONS, and profits received or receivable therefrom, and any
other property, at any
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time and from time to time received by, receivable by, or otherwise
distributed or delivered to Secured Party, in respect of, or in
exchange for, any or all of the property described above (the property
described in PARAGRAPHS 2.2(a) AND 2.2(b) being referred to herein as
the "PLEDGED SECURITIES").
SECTION 15
REPRESENTATIONS AND WARRANTIES
By entering into this agreement, and by each subsequent delivery of
additional Collateral under this agreement, Debtor reaffirms the representations
and warranties contained in the Credit Agreement. Debtor further represents and
warrants to Secured Party as follows:
Section 15.1 BINDING OBLIGATION. This agreement creates a legal, valid,
and binding Lien in and to the Collateral in favor of Secured Party and is
enforceable against Debtor. The taking by Secured Party of physical possession
in Indiana of the stock certificates or other instruments representing the
Pledged Securities will perfect the Security Interest in that Collateral. Once
perfected, the Security Interest will constitute a first priority Lien on the
Collateral. The creation of the Security Interest does not require the consent
of any Person that has not been obtained.
Section 15.2 SECURITIES. All Pledged Securities are duly authorized,
validly issued, fully paid, and non-assessable, and the transfer of them is not
subject to any restrictions other than restrictions imposed by applicable
corporate, banking and securities laws.
Section 15.3 MISCELLANEOUS REPRESENTATIONS. Debtor hereby represents
and warrants that: (a) Debtor is the legal and beneficial owner of the
Collateral free and clear of all Liens, charges, pledges, encumbrances, and
security interests of every kind and nature other than Liens in favor of Secured
Party; (b) each Pledged Security has been validly authorized and issued, and is
fully paid and nonassessable; (c) Debtor has good right and lawful authority to
pledge the Collateral in the manner hereby done or contemplated; (d) no consent
or approval of or notice to any Governmental Authority, or of any securities
exchange, is necessary to effect the validity of the rights created hereunder
which have not been obtained; (e) except for any financing statement which may
have been filed by Secured Party, no financing statement covering the
Collateral, or any part thereof, has been filed with any filing officer; (f) no
presently effective security agreement covering the Collateral, or any part
thereof, has been made, and no presently effective security interest, other than
the one herein created, has attached or been perfected in the Collateral, or any
part thereof; (g) the execution, delivery, and consummation of this agreement
(i) have been duly authorized by all requisite corporate action on the part of
Debtor, and (ii) will not violate the Constituent Documents of Debtor or any
issuer, or any law, regulation, mortgage, indenture, contract, instrument,
judgment, or decree applicable to or binding on Debtor or the issuers of the
Pledged Securities; (h) the Bank Securities constitute 100% of the issued and
outstanding voting stock of the Bank Subsidiaries; (i) all other Pledged
Securities constitute all of the stock of the Bank Subsidiaries owned directly
or indirectly by Debtor; (j) none of the Pledged Securities are subject to any
options or other rights of third parties, and (k) Debtor's chief executive
office is located at ▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. Debtor has
not used or transacted business under any other corporate name or tradename in
the five year period preceding the date hereof.
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Section 15.4 ADDITIONAL COLLATERAL. The foregoing representations and
warranties will be true and correct in all respects with respect to any
additional Collateral or additional specific descriptions of certain Collateral
delivered to Secured Party in the future by Debtor.
The failure of any of these representations or warranties to be
accurate and complete does not impair the Security Interest in any Collateral.
SECTION 16
SECURED PARTY AS CUSTODIAN
Secured Party shall have physical possession of the certificates or
instruments representing or evidencing the Collateral. Debtor agrees that either
(a) all certificates representing Pledged Securities shall, after the occurrence
of an Event of Default, be registered in the appropriate stock record books in
the name of Secured Party or a nominee or nominees of Secured Party, or (b) in
lieu of presently registering the Pledged Securities in the name of Secured
Party or its nominee as provided in CLAUSE (a) above, Debtor will deposit with
Secured Party, along with the certificates or instruments representing or
evidencing the Pledged Securities, duly executed stock powers in favor of
Secured Party or its nominee with signatures guaranteed by a member or member
organization of the New York Stock Exchange or by a commercial bank or trust
Borrower acceptable to the transfer agent. In addition, Secured Party shall,
after the occurrence of an Event of Default, have the right to exchange
certificates or instruments representing or evidencing the Pledged Securities
for certificates or instruments of smaller or larger denominations for any
purpose consistent with its performance of this agreement.
SECTION 17
COVENANTS
Until all commitments by Secured Party to extend credit under the
Credit Agreement have been canceled or terminated and the Obligations are fully
paid and performed, Debtor covenants and agrees with Secured Party as follows:
Section 17.1 ADDITIONAL DOCUMENTS AND INFORMATION. Debtor shall: (i)
from time to time, at Debtor's expense, promptly execute and deliver to Secured
Party all such stock powers, assignments, certificates, supplemental writings,
financing statements, and other items, and do all other acts or things as
Secured Party may reasonably request in order more fully to evidence and perfect
the security interest of Secured Party in the Collateral or enable it to
exercise and enforce its rights hereunder; (ii) punctually and properly perform
all of Debtor's covenants and duties under any other security agreement, deed of
trust, collateral agreement, or contract of any kind now or hereafter existing
as security for, or in connection with, payment of the Obligations (to the
extent liable thereon) in accordance with the terms hereof, and in accordance
with the terms of the Term Note; (iii) promptly furnish Secured Party with any
information or writings which Secured Party may reasonably request concerning
the Collateral; (iv) allow Secured Party to inspect all records of Debtor
relating to the Collateral or to the Obligations, and to make and take away
copies of such records; (v) promptly notify Secured Party of any change in any
fact or circumstances warranted or represented by Debtor in this agreement that
could reasonably be expected to result in a Material Adverse Effect, or in any
other writing furnished by Debtor to
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Secured Party in connection with the Collateral or the Obligations; (vi)
promptly notify Secured Party of any claim, action, or proceeding affecting
title to the Collateral, or any part thereof, or the security interest therein,
and, at the request of Secured Party, appear in and defend, at Debtor's expense,
any such action or proceeding; and (vii) promptly, after being requested by
Secured Party, pay to Secured Party the amount of all reasonable expenses,
including reasonable attorneys' fees and other legal expenses, incurred by
Secured Party in perfecting, maintaining, and enforcing the security interest.
Section 17.2 PROCEEDS. Should the Pledged Securities, or any part
thereof, ever be in any manner converted by its issuer or maker into another
type of property, or any money or other proceeds ever be paid or delivered to
Debtor as a result of Debtor's rights in the Pledged Securities, then, in any
such event, all such property, money, and other proceeds, except only ordinary
cash dividends (unless and until payable to Secured Party, pursuant to Section
6.2 hereof), shall become part of the Pledged Securities, and shall be delivered
to Secured Party by Debtor.
Section 17.3 PERFORMANCE BY SECURED PARTY. Should any covenant, duty,
or agreement of Debtor fail to be performed in accordance with its terms
hereunder, Secured Party may, but shall never be obligated to, after three (3)
Business Days written notice thereof to Debtor, perform or attempt to perform
such covenant, duty, or agreement on behalf of Debtor, and any amount expended
by Secured Party in such performance or attempted performance shall become a
part of the Obligations, and, at the request of Secured Party, Debtor agrees to
pay such amount promptly to Secured Party, at Secured Party's office in
Indianapolis, Indiana, together with interest thereon at the rate provided in
the Credit Agreement.
Section 17.4 COVENANT REGARDING REGISTRATION. If Secured Party shall
determine to exercise its right to sell any or all of the Pledged Securities
pursuant to Section 7.2 hereof, and if, in the opinion of counsel for Secured
Party, it is necessary, or if, in the opinion of Secured Party, it is advisable
to have the Pledged Securities, or that portion thereof to be sold, registered
under the provisions of any applicable banking and securities laws (the
"Securities Act"), then Debtor will, at Secured Party's request and at Debtor's
expense, cause each issuer of the Pledged Securities, or of that portion thereof
to be sold, to execute and deliver, and cause the directors and officers of each
such issuer to execute and deliver, all such instruments and documents, and
cause such issuer(s), directors, and officers to do or cause to be done all such
other acts and things as may be necessary or, in Secured Party's opinion,
advisable to register the Pledged Securities, or that portion thereof to be
sold, under the provisions of the Securities Act, and to cause the registration
statement relating thereto to become effective and to remain effective for a
period of one year from the date of the first public offering of the Pledged
Collateral, or that portion thereof to be sold, and to make all amendments
thereto and/or to the related prospectus that, in Secured Party's opinion, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations applicable thereto:
Section 17.5 NEGATIVE COVENANTS. Without the prior written consent of
Secured Party, Debtor will not: (i) sell, assign, or transfer any rights of
Debtor in the Collateral; (ii) grant any options or other rights in the
Collateral; (iii) create any other Lien or security interest in, mortgage, or
otherwise encumber the Collateral, or any part thereof, or permit the same to be
or become subject to any Lien, attachment, execution, sequestration, other legal
or equitable
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process, or any encumbrance of any kind or character, except the security
interest herein created; (iv) vote for, or consent to, any amendment of the
Constituent Documents of any issuer that might reasonably be expected to
materially adversely affect the value of the Pledged Securities; (v) permit the
issuers of the Pledged Securities to merge or consolidate with or into any
corporation or other Person, except as expressly permitted by the Credit
Agreement; or (vi) permit the issuers of the Pledged Securities to issue any
shares to any other Person.
Section 17.6 OTHER NOTICES AND ACTIONS. Debtor shall promptly notify
Secured Party of (a) any change in any material fact or circumstance represented
or warranted by Debtor with respect to any of the Collateral, and (b) any claim,
action, or proceeding challenging the Security Interest or affecting title to
all or any material portion of the Collateral or the Security Interest (and, at
Secured Party's request, Debtor shall appear in and defend any such action or
proceeding at Debtor's expense).
Section 17.7 IMPAIRMENT OF COLLATERAL. Debtor shall not do or permit
any act that is reasonably likely to adversely impair the value of any
Collateral.
SECTION 18
VOTING RIGHTS, DIVIDENDS, ETC., PRIOR TO EVENT OF DEFAULT
Section 18.1 RIGHTS PRIOR TO EVENT OF DEFAULT. So long as no Event of
Default shall have occurred after the date hereof and be continuing, and Secured
Party shall not have given written notice to Debtor of its intention to exercise
its voting rights pertaining to the Pledged Securities as set forth in Section
6.2 below:
(a) Debtor shall be entitled to exercise any and all
voting and/or consensual rights and powers relating or pertaining to
the Pledged Securities, or any part thereof, for any purpose not
inconsistent with the terms of this agreement.
(b) Debtor shall be entitled to receive, retain, and
expend or use in its business any and all ordinary cash dividends and
non-liquidating distributions in-kind payable on the Pledged
Securities, but any and all stock and/or liquidating dividends, returns
of capital, or other distributions made on or in respect of the Pledged
Securities, whether resulting from a subdivision, combination, or
reclassification of the outstanding capital stock of any issuer
thereof, or received in exchange for Pledged Securities or any part
thereof, or as a result of any merger, consolidation, acquisition, or
other exchange of assets to which any such issuer may be a party or
otherwise, and any and all cash and other property received in exchange
for the Pledged Securities or received in payment of the principal of,
or in redemption of, the Pledged Securities (either at maturity, upon
call for redemption, or otherwise), shall be and become part of the
collateral pledged hereunder, and if received by Debtor, shall be held
in trust for the benefit of Secured Party, and forthwith be delivered
to Secured Party (accompanied by proper instruments of assignment
and/or stock powers executed by Debtor in accordance with Secured
Party's instructions) to be held subject to the terms of this
agreement.
(c) Secured Party shall execute and deliver (or cause to
be executed and delivered) to Debtor all such proxies, powers of
attorney, dividend orders, and other
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instruments as Debtor may request for the purpose of enabling Debtor to
exercise the voting and/or consensual rights and powers which it is
entitled to exercise pursuant to SUBSECTION (a) above and/or to receive
the dividends which it is authorized to receive and retain pursuant to
SUBSECTION (b) above.
Section 18.2 TERMINATION OF RIGHTS. Upon (i) the occurrence after the
date hereof of an Event of Default, and (ii) the giving of written notice by
Secured Party to Debtor of its intention to (A) foreclose upon, or otherwise
dispose of, the Pledged Securities, or (B) exercise its voting rights pertaining
to the Pledged Securities, subject to the receipt by Secured Party of required
federal or state regulatory approvals, if any, all rights of Debtor to exercise
the voting and/or consensual rights and powers which it is entitled to exercise
pursuant to Section 6.1(a) hereof, and/or to receive the dividends which it is
authorized to receive and retain pursuant to Section 6.1(b) hereof, shall cease,
at the option of Secured Party, and all such rights shall thereupon become
vested in Secured Party, who shall have the sole and exclusive right and
authority to exercise such voting and/or consensual rights and powers, and/or to
receive and retain the dividends which Debtor would otherwise be authorized to
retain pursuant to Section 6.1(b) hereof. Further, Secured Party shall have the
right upon the occurrence of an Event of Default, to notify and direct the
issuers of the Pledged Securities to thereafter make all payments,
distributions, dividends, and any other distributions payable in respect thereof
directly to Secured Party. The issuers of the Pledged Securities making any such
payment or distribution to Secured Party hereunder shall be fully protected in
relying on the written statement of Secured Party that it then holds a security
interest which entitles it to receive such payments and distributions. Any and
all money and other property paid over to, or received by, Secured Party
pursuant to the provisions of this Section 6.2 shall be retained by Secured
Party as additional collateral hereunder, and may be applied (and upon Debtor's
written request all cash shall promptly be applied) in accordance with the
provisions hereof.
SECTION 19
EVENT OF DEFAULT AND REMEDIES
Section 19.1 REMEDIES. Upon the occurrence of an Event of Default, in
addition to any and all other rights and remedies which Secured Party may then
have hereunder, under the Loan Documents, under applicable law, under the UCC,
as applicable, or otherwise, Secured Party shall have the right to: (i) declare
the entire unpaid balance of principal and all accrued interest on the
Obligations immediately due and payable, without written notice, demand, notice
of intent to accelerate, notice of acceleration, or presentment, all of which
are hereby waived; (ii) reduce any claims to judgment, foreclose, or otherwise
enforce its Security Interest in all or any part of the Collateral by any
available judicial procedure; (iii) after notification, if any, expressly
provided for herein, sell or otherwise dispose of, at the office of Secured
Party or elsewhere, as chosen by Secured Party, all or any part of the
Collateral, and any such sale or other disposition may be as a unit or in
parcels, by public or private proceedings, and by way of one or more contracts,
(it being agreed that the sale of any part of the Collateral shall not exhaust
Secured Party's power of sale, but sales may be made from time to time until all
of the Collateral has been sold, or until the Obligations have been paid in
full, provided, however, that Secured Party shall have no obligation to sell the
Collateral piecemeal, it being specifically acknowledged that a sale of all of
the Collateral to one purchaser in single transaction shall be conclusively
presumed to be commercially reasonable), and at any such sale it shall not be
necessary to
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exhibit the Collateral; (iv) retain the Collateral in satisfaction of the
Obligations whenever the circumstances are such that Secured Party, is entitled
to do so under the UCC; (v) apply by appropriate judicial proceedings for
appointment of a receiver for the Collateral, or any part thereof; and Debtor
hereby consents to any such appointment; (vi) purchase the Collateral at any
public sale in accordance with the UCC; (vii) purchase the Collateral at any
private sale in accordance with the UCC; and (viii) exercise the rights set
forth in this agreement in accordance with the UCC.
Section 19.2 SALE OF PLEDGED SECURITIES. Secured Party is authorized,
at any sale of the Pledged Securities, if it deems it advisable, to restrict the
prospective bidders or purchasers to those persons who will represent and agree
that they are purchasing for their own account, for investment, and not with a
view to distribution or sale of any of the Pledged Securities. Upon any such
sale, Secured Party shall have the right to deliver, assign, and transfer to the
purchaser thereof the Pledged Securities so sold. Each purchaser at any such
sale shall hold the property sold absolutely, free from any claim or right of
whatsoever kind, including any equity or right of redemption, of Debtor which
hereby specifically waives all rights of redemption, stay, or appraisal which it
has or may have under any rule of law or statute now existing or hereafter
adopted, and such waiver shall be deemed to have been made after an Event of
Default. Secured Party shall give Debtor seven days written notice of its
intention to make any such public or private sale, or sale at broker's board or
on a securities exchange. Such notice, in case of sale at broker's board or on a
securities exchange, shall state the board or exchange at which such sale is to
be made, and the day on which the Pledged Securities, or that portion thereof so
being sold, which will first be offered for sale at such board or exchange.
Secured Party shall have no obligation to disclose or provide any information
concerning the issuers or the Pledged Securities to prospective purchasers of
the Pledged Securities, other than information in its possession at such time,
and Debtor agrees and acknowledges that it shall be commercially reasonable for
any notices of any such sale, published or otherwise, to specifically so state.
At any such sale the Pledged Securities may be sold in one lot as an entirety or
in separate parcels, as Secured Party may elect, and any such election shall be
presumed to be commercially reasonable. Secured Party shall not be obligated to
make any such sale pursuant to any such notice. Secured Party may, without
notice or publication, adjourn any public or private sale or cause the same to
be adjourned from time to time by announcement at the time and place fixed for
the sale, and such sale may be made at any time or place to which the same may
be so adjourned. In case of any sale of all or any part of the Pledged
Securities on credit or for future delivery, the Pledged Securities so sold may
be retained by Secured Party until the selling price is paid by the purchaser
thereof; but Secured Party shall not incur any liability in case of the failure
of such purchaser to take and pay for the Pledged Securities so sold, and, in
case of any such failure, such Pledged Securities may again be sold upon like
notice. Secured Party may also, at its discretion, proceed by a suit or suits at
law or in equity to foreclose the pledge and sell the Pledged Securities, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction. If any consent, approval, or authorization of any federal, state,
municipal, or other governmental department, agency, or authority should be
necessary to effectuate any sale or other disposition of the Pledged Securities,
or any part disposition of the Pledged Securities, or any part thereof; Debtor
will execute all such applications and other instruments as may be required in
connection with securing any such consent, approval, or authorization, and will
otherwise use its best efforts to secure the same. Any sale of the Pledged
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Securities conditioned upon the receipt of any such consent, approval, or
authorization shall be presumed to be commercially reasonable.
Section 19.3 POSSIBLE RESTRICTIONS ON SALE OF PLEDGED COLLATERAL.
Because of the Securities Act and other applicable laws or regulations, there
may be legal restrictions or limitations affecting Secured Party in any attempts
to dispose of certain portions of the Pledged Securities in the enforcement of
its rights and remedies hereunder. For these reasons, Secured Party is hereby
authorized by Debtor, but not obligated, in the event of any Event of Default
hereunder giving rise to Secured Party's rights to sell or otherwise dispose of
the Pledged Securities, and after the giving of any notices required herein, to
sell all or any part of the Pledged Securities at private sale, subject to an
investment letter or subject to any purchase agreement, or receipt of any
regulatory approvals regarding change of control approvals, or with respect to
any other matter, or in any other manner which will not require the Pledged
Securities, or any part thereof; to be registered in accordance with the
Securities Act, as amended, or other applicable rules and regulations
promulgated thereunder, or any other law or regulation, at the best price
reasonably obtainable by Secured Party at any such private sale or other
disposition in the manner mentioned above, and Debtor specifically acknowledges
that any such disposition shall be commercially reasonable under the UCC.
Secured Party is also hereby authorized by Debtor, but not obligated, to take
such actions, give such notices, obtain such consents, and do such other things
as Debtor may deem required or appropriate in the event of a sale or disposition
of any of the Pledged Securities. Debtor clearly understands that Secured Party
may, at its discretion, approach a restricted number of potential purchasers,
and may impose such other conditions in connection with any such sale as Secured
Party deems necessary or desirable in order to comply with the Securities Act
and other applicable laws, and that a sale under such circumstances may yield a
lower price for the Pledged Securities, or any part or parts thereof, than would
otherwise be obtainable if same were registered and sold in the open market.
Debtor agrees (i) in the event Secured Party shall, upon an Event of Default
hereunder, sell the Pledged Securities, or any portion thereof, at such private
sale or sales, Secured Party shall have the right to rely upon the advice and
opinion of any member firm of a national securities exchange as to the best
price reasonably obtainable upon such private sale thereof, and (ii) that such
reliance shall be conclusive evidence that Secured Party handled such matter in
a commercially reasonable manner under the UCC.
If an Event of Default exists, then Secured Party may, at its election
(but subject to the terms and conditions of the Credit Agreement), exercise any
and all rights available to a secured party under the UCC, in addition to any
and all other rights afforded by the Loan Documents, at law, in equity, or
otherwise, including, without limitation (a) requiring Debtor to assemble all or
part of the Collateral and make it available to Secured Party at a place to be
designated by Secured Party which is reasonably convenient to Debtor and Secured
Party, and (b) applying to the Obligations any cash held by Secured Party under
the Loan Documents.
Section 19.4 NOTICE. Reasonable notification of the time and place of
any public sale of the Collateral, or reasonable notification of the time after
which any private sale or other intended disposition of the Collateral is to be
made, shall be sent to Debtor and to any other Person entitled to notice under
the UCC. If any Collateral threatens to decline speedily in value or is of the
type customarily sold on a recognized market, Secured Party may sell or
otherwise dispose of the Collateral without notification, advertisement, or
other notice of any kind. Notice
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sent or given not less than seven calendar days before the taking of the action
to which the notice relates is reasonable notification and notice for the
purposes of this section.
Section 19.5 OTHER SALES. Secured Party's sale of less than all
Collateral does not exhaust Secured Party's rights under this agreement and
Secured Party is specifically empowered to make successive sales until all
Collateral is sold. If the proceeds of a sale of less than all Collateral are
less than the Obligations, then this agreement and the Security Interest remain
in full force and effect as to the unsold portion of the Collateral just as
though no sale had been made. In the event any sale under this agreement is not
completed or is, in Secured Party's opinion, defective, that sale does not
exhaust Secured Party's rights under this agreement, and Secured Party is
entitled to cause a subsequent sale or sales to be made. All statements of fact
or other recitals made in any ▇▇▇▇ of sale or assignment or other instrument
evidencing any foreclosure sale under this agreement (whether about nonpayment
of the Obligations, the occurrence of any Event of Default, Secured Party's
having declared all of the Obligations to be due and payable, notice of time,
place, and terms of sale and the properties to be sold having been duly given,
or any other act or thing having been duly done by Secured Party) shall be taken
as prima facie evidence of the truth of the facts so stated and recited. Secured
Party may appoint or delegate any one or more Persons as agent to perform any
act or acts necessary or incident to any sale held by Secured Party, including
the sending of notices and the conduct of sale, but such acts must be done in
the name and on behalf of Secured Party.
Section 19.6 POWER-OF-ATTORNEY. Secured Party is deemed to be
irrevocably appointed as Debtor's agent and attorney-in-fact with the right to
enforce all of Debtor's rights under or in connection with the Collateral
effective and operable at all times while an Event of Default exists. All
reasonable costs, expenses, and liabilities incurred and all payments made by
Secured Party as Debtor's agent and attorney-in-fact (including, without
limitation, reasonable attorney's fees and expenses) are considered a loan by
Secured Party to Debtor that is repayable on demand, accrues interest at the
rate specified in the Credit Agreement to be applied upon an Event of Default
until paid, and is part of the Obligations.
Section 19.7 APPLICATION OF PROCEEDS. Secured Party shall apply the
proceeds of any sale or other disposition of the Collateral under this Section 7
in the order and manner specified in Article III of the Credit Agreement. Any
surplus remaining shall be delivered to Debtor or as a court of competent
jurisdiction may direct. If the proceeds are insufficient to pay the Obligations
in full, Debtor remains liable for any deficiency.
SECTION 20
AUTHORITY OF SECURED PARTY
Secured Party shall have and be entitled to exercise all such powers
hereunder as are specifically delegated to Secured Party by the terms hereof,
together with such powers as are reasonably incidental thereto. Secured Party
may execute any of its duties hereunder by or through sub-agents or employees,
and shall be entitled to retain counsel and to act in reliance upon the advice
of such counsel concerning all matters pertaining to said duties. Secured Party
and any director, officer, or employee of Secured Party shall not be liable for
any action taken or omitted to be taken by them or any of them hereunder or in
connection herewith, except for their own gross negligence or willful
misconduct; nor shall Secured Party be responsible for the
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validity, effectiveness, or sufficiency hereof, or of any document or security
furnished pursuant hereto or in connection herewith. Secured Party shall be
entitled to rely on any communication, instrument, or document believed by it to
be genuine and correct and to have been signed or sent by the proper Person or
Persons.
SECTION 21
OTHER RIGHTS; PERFORMANCE
If Debtor fails to preserve the priority of the Security Interest in
any of the Collateral or otherwise fails to perform any of its obligations under
the Loan Documents with respect to the Collateral, then Secured Party may, at
its option, but without being required to do so, prosecute or defend any suits
in relation to the Collateral or take all other action which Debtor is required,
but has failed or refused, to take under the Loan Documents. Any sum which may
be expended or paid by Secured Party under this section (including, without
limitation, court costs and attorneys' fees) shall bear interest from the dates
of expenditure or payment at the rate specified in the Credit Agreement to be
applied upon an Event of Default until paid and, together with such interest,
shall be payable by Debtor to Secured Party upon demand and is part of the
Obligations.
▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ hereby agrees to reimburse Secured Party, on demand, for all
reasonable expenses incurred by it in connection with the administration and
enforcement of this Agreement, and agrees to indemnify and hold harmless Secured
Party from and against any and all liability incurred by it hereunder or in
connection herewith, unless such liability shall be due to willful misconduct or
gross negligence on the part of Secured Party. Other than the exercise of
reasonable care in the physical custody of the Pledged Securities while held by
Secured Party, Secured Party shall have no responsibility for or obligation or
duty with respect to all or any part of the Collateral, or any matter or
proceeding arising out of or relating thereto, including, without limitation,
any obligation or duty to collect any sums due in respect thereof, or to protect
or preserve any rights against prior parties, or any other rights pertaining
thereto, it being understood and agreed that Debtor shall be responsible
generally for the preservation of all rights in the Collateral. Without limiting
the generality of the foregoing, Secured Party shall be conclusively deemed to
have exercised reasonable care in the custody of the Collateral if secured party
takes such action, for purposes of preserving rights in the Collateral, as
Debtor may reasonably request in writing, but no failure or omission or delay by
Secured Party in complying with any such request by Debtor, and no refusal by
Secured Party to comply with any such request by Debtor shall be deemed to be a
failure to exercise reasonable care.
SECTION 23
SECURED PARTY APPOINTED ATTORNEY-IN-FACT
Debtor hereby appoints Secured Party as Debtor's attorney-in-fact to
act, after the occurrence and during the continuance of an Event of Default, in
the name of Debtor or otherwise for the purpose of carrying out the provisions
of this agreement, and taking any action, and executing any instrument which
Secured Party may deem necessary or advisable to
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accomplish the purposes hereof. Without limiting the generality of the
foregoing, Secured Party shall have the right and power, after the occurrence
and during the continuance of an Event of Default, to receive, endorse, and
collect all checks and other orders for the payment of money made payable to
Debtor representing any dividend or other distribution payable or distributable
in respect of the Collateral, or any part thereof, and to give full discharge
for the same.
SECTION 24
MISCELLANEOUS
Section 24.1 TERM. This agreement terminates upon full payment and
performance of the Obligations. No Obligor is ever obligated to make inquiry of
the termination of this agreement but is fully protected in making any payments
on the Collateral directly to Secured Party.
Section 24.2 MATTERS NOT RELEVANT. The Security Interest, Debtor's
obligations, and Secured Party's rights under this agreement are not released,
diminished, impaired, or adversely affected by any one or more of the following:
(a) Secured Party's taking or accepting any additional--or any release,
surrender, exchange, subordination, or loss of any other -- guaranty, assurance,
or security for any of the Obligations; (b) any full or partial release of any
other Person obligated on any of the Obligations; (c) the modification or
assignment of-- or waiver of compliance with-- any other Term Loan Document; (d)
any present or future insolvency, bankruptcy, or lack of corporate, partnership,
or trust power of any other Person obligated on any of the Obligations; (e) any
renewal, extension, or rearrangement of any of the Obligations, or any
adjustment, indulgence, forbearance, or compromise granted to any Person
obligated on any of the Obligations; (f) any Person's neglect, delay, omission,
failure, or refusal to take or prosecute any action in connection with any of
the Obligations; (g) any existing or future affect, claim, or defense (other
than credits toward outstanding amounts in respect of application of proceeds of
Collateral under this agreement and except for the defense of full and final
payment of the Obligations) of Debtor or any other Person against Secured Party;
(h) the unenforceability of any of the Obligations against any Person obligated
or any of the Obligations because it exceeds the amount permitted by law, the
act of creating it is ultra ▇▇▇▇▇, or the officers, partners, or trustees
creating it exceeded their authority or violated their fiduciary duties, or
otherwise; (i) any payment of the Obligations is held to constitute a preference
under the United States Bankruptcy Code or any similar state or federal debtor
relief laws or for any other reason Secured Party is required to refund any
payment or make payment to another Person; or (j) any Person's failure to notify
Debtor or the Secured Party of their acceptance of this agreement or any
Person's failure to notify Debtor about the foregoing events or occurrences, and
Debtor waives any notice of any kind under any circumstances whatsoever with
respect to this agreement or any of the Obligations other than as specifically
provided in this agreement.
Section 24.3 WAIVERS. Except to the extent expressly otherwise provided
in the Loan Documents, Debtor waives (a) any right to require Secured Party to
proceed against any other Person, to exhaust its rights in the Collateral, or to
pursue any other right which Secured Party may have, and (b) all rights of
marshaling in respect of the Collateral.
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Section 24.4 FINANCING STATEMENT. Secured Party may, at any time, file
a financing statement accurately describing the Collateral, but Secured Party's
failure to do so does not impair the validity or enforceability of this
agreement.
Section 24.5 PARTIES. This agreement binds and inures to Debtor,
Secured Party, and their respective successors and permitted assigns. Only those
Persons may rely or raise any defense about this agreement. Debtor may not
assign any rights or obligations under this agreement without first obtaining
the written consent of Secured Party. The Secured Party may assign, pledge, and
otherwise transfer all or any of its rights under this agreement to any
participant or transferee permitted by the Credit Agreement.
Section 24.6 SURVIVAL. All agreements, representations and warranties
made herein shall survive the execution of this Agreement.
Section 24.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Indiana (without
reference to conflict of law principles), except to the extent superseded by
federal law.
Section 24.8 COUNTERPARTS. This Agreement may be signed in any number
of counterparts with the same effect as if the signatures thereto and hereto
were upon the same instrument.
Section 24.9 NOTICES. All communications or notices required under this
Agreement shall be in writing and shall be deemed to have been given (i) on the
date when sent by facsimile transmission to the facsimile number set forth
below, or (ii) on the date when delivered, sent by nationally recognized
overnight delivery service, or deposited in the United States mail, postage
prepaid, in each case to the following address (unless and until any of such
parties advises the other in writing of a change in such address):
If to the Debtor: Blue River Bancshares, Inc.
▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Secured Party: Union Federal Bank of Indianapolis
▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Section 24.10 NO AGENCY. Nothing in this Agreement or in the other
documents referred to herein and no action taken pursuant hereto shall cause the
Borrower to be treated as an agent of the Secured Party, or shall be deemed to
constitute the Secured Party and the Borrower a partnership, association, joint
venture or other entity.
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Section 24.11 NO THIRD PARTY BENEFIT. This Agreement is solely for the
benefit of the parties hereto and their permitted successors and assigns. No
other person or entity shall have any rights under, or because of the existence
of, this Agreement.
Section 24.12 CONSENT TO JURISDICTION. The Borrower hereby consents to
the jurisdiction of any state or federal court situated in ▇▇▇▇▇▇ County,
Indiana, and waives any objection based on lack of personal jurisdiction,
improper venue or forum non conveniens, with regard to any actions, claims,
disputes or proceedings relating to this Agreement or any other document
delivered hereunder or in connection herewith, or any transaction arising from
or connected to any of the foregoing. The Borrower waives personal service of
any and all process upon it, and consents to all such service of process made by
mail or by messenger directed to it at the address specified below. Nothing
herein shall affect the right of the Secured Party, to serve process in any
manner permitted by law, or limit the right of the Secured Party, to bring
proceedings against the Borrower or its property or assets in the competent
courts of any other jurisdiction or jurisdictions.
Section 24.13 WAIVER OF JURY TRIAL. The Borrower and the Secured Party
hereby jointly and severally waive any and all right to trial by jury in any
action or proceeding relating to this Agreement or any other document delivered
hereunder or in connection herewith, or any transaction arising from or
connected to any of the foregoing. The Borrower and the Secured Party each
represent that this waiver is knowingly, willingly and voluntarily given.
Section 24.14 LIMITATION OF LIABILITY. The Borrower and the Secured
Party hereby waive any right any of them may now or hereafter have to claim or
recover from any other party hereto any consequential, exemplary or punitive
damages.
Section 24.15 ENTIRE AGREEMENT. This Agreement and the other Loan
Documents represent the final agreement between the parties with respect to the
subject matter thereof and may not be contradicted by evidence of prior,
contemporaneous, or subsequent oral agreements of the parties. There are no
unwritten oral agreements between the parties.
REMAINDER OF PAGE INTENTIONALLY BLANK
SIGNATURE PAGE FOLLOWS
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EXECUTED as of the date first stated above.
BLUE RIVER BANCSHARES, INC., UNION FEDERAL BANK OF
as Debtor INDIANAPOLIS, as Secured Party
By: _____________________________ By: ________________________________
Name: ___________________________ Name: ______________________________
Title: __________________________ Title: _____________________________
The undersigned agrees that to the extent that any of the stock
certificates evidencing any of the capital stock that is included in the
Collateral bear any restrictive legend in respect of the transfer of those
certificates, then, in each case, the undersigned waives the requirements of
those restrictive legends in respect of the pledge of those shares of capital
stock to Secured Party.
SHELBY COUNTY BANK
By: ________________________________
Name: ______________________________
Title: _____________________________
UNIFIED BANKING COMPANY
By: ________________________________
Name: ______________________________
Title: _____________________________
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