1
EXHIBIT 10.2
AMENDED AND RESTATED
LOAN AGREEMENT
by and between
ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
EMPLOYEE STOCK OWNERSHIP PLAN TRUST
and
ASTORIA FINANCIAL CORPORATION
Made and Entered Into as of
January 1, 2000
2
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.1 Business Day......................................................1
Section 1.2 Code..............................................................2
Section 1.3 Default...........................................................2
Section 1.4 ERISA.............................................................2
Section 1.5 Event of Default..................................................2
Section 1.6 Independent Counsel...............................................2
Section 1.7 Loan..............................................................2
Section 1.8 Loan Documents....................................................2
Section 1.9 Pledge Agreement..................................................2
Section 1.10 Principal Amount.................................................2
Section 1.11 Promissory Note..................................................2
Section 1.12 Register.........................................................2
ARTICLE II
THE LOAN; PRINCIPAL AMOUNT;
INTEREST; SECURITY
Section 2.1 The Loan; Principal Amount; Repayment of
Outstanding Indebtedness......................................................2
Section 2.2 Interest..........................................................3
Section 2.3 Promissory Note...................................................4
Section 2.4 Payment of Loan...................................................4
Section 2.5 Prepayment........................................................4
Section 2.6 Method of Payments................................................6
Section 2.7 Security..........................................................7
Section 2.8 Registration of the Promissory Note...............................8
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
Section 3.1 Power, Authority, Consents........................................8
Section 3.2 Due Execution, Validity, Enforceability...........................8
Section 3.3 Properties, Priority of Liens.....................................9
Section 3.4 No Defaults, Compliance with Laws.................................9
Section 3.5 Marketable Title; Legality........................................9
(i)
3
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE LENDER
Section 4.1 Power, Authority, Consents........................................9
Section 4.2 Due Execution, Validity, Enforceability..........................10
Section 4.3 ESOP; Contributions..............................................10
Section 4.4 Compliance with Laws; Actions....................................10
ARTICLE V
EVENTS OF DEFAULT
Section 5.1 Events of Default under Loan Agreement...........................10
Section 5.2 Lender's Rights upon Event of Default............................11
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.1 Payments.........................................................11
Section 6.2 Survival.........................................................12
Section 6.3 Modifications, Consents and Waivers; Entire Agreement............12
Section 6.4 Remedies Cumulative..............................................12
Section 6.5 Further Assurances; Compliance with Covenants....................12
Section 6.6 Notices..........................................................13
Section 6.8 Counterparts.....................................................13
Section 6.9 Construction; Governing Law......................................14
Section 6.10 Severability....................................................14
Section 6.11 Binding Effect; No Assignment or Delegation.....................14
EXHIBIT 1 Form of Promissory Note...........................................1-1
EXHIBIT 2 Form of Pledge Agreement..........................................2-1
(ii)
4
1-
LOAN AGREEMENT
This LOAN AGREEMENT (the "Loan Agreement") is made and entered
into as of the 1st day of January, 2000, by and between ASTORIA FEDERAL SAVINGS
AND LOAN ASSOCIATION EMPLOYEE STOCK OWNERSHIP PLAN TRUST (the "Borrower"), a
trust forming part of the ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION EMPLOYEE
STOCK OWNERSHIP PLAN ("ESOP"), acting through and by its Trustee, STATE STREET
BANK AND TRUST COMPANY (the "Trustee"), a banking corporation organized under
the laws of the state of Massachusetts; and ASTORIA FINANCIAL CORPORATION (the
"Lender"), a corporation organized and existing under the laws of the state of
Delaware.
W I T N E S S E T H :
-------------------
WHEREAS, the Lender's wholly-owned subsidiary, ASTORIA FEDERAL
SAVINGS AND LOAN ASSOCIATION (the "Association"), maintains the ESOP for the
benefit of eligible employees; and
WHEREAS, the Borrower and the Lender are parties to a Loan
Agreement dated November 18, 1993 (the "Prior Agreement"), pursuant to which the
Borrower has borrowed funds from the Lender to finance the purchase of shares of
common stock, par value $.01 per share, of the Lender ("Shares") and has an
outstanding indebtedness in the amount of EIGHTEEN MILLION SIX HUNDRED FOURTEEN
THOUSAND EIGHT HUNDRED THIRTY-THREE DOLLARS AND TWENTY-NINE CENTS
($18,614,833.29) (the "Outstanding Indebtedness"), plus accrued and unpaid
interest from December 31, 1999; and
WHEREAS, the Borrower and the Lender have determined that it
is in their mutual interests to modify the terms of repayment of the Outstanding
Indebtedness in the manner set forth in this Agreement;
NOW, THEREFORE, the parties hereto agree that the Prior
Agreement shall be amended and restated in its entirety effective as of January
1, 2000, as follows:
ARTICLE I
DEFINITIONS
The following definitions shall apply for purposes of this
Loan Agreement, except to the extent that a different meaning is plainly
indicated by the context:
5
2-
Section 1.1 Business Day means any day other than a Saturday,
Sunday or other day on which banks are authorized or required to close under
federal law or the laws of the State of New York.
Section 1.2 Code means the Internal Revenue Code of 1986
(including the cor responding provisions of any succeeding law).
Section 1.3 Default means an event or condition which would
constitute an Event of Default. The determination as to whether an event or
condition would constitute an Event of Default shall be determined without
regard to any applicable requirement of notice or lapse of time.
Section 1.4 ERISA means the Employee Retirement Income
Security Act of 1974, as amended (including the corresponding provisions of any
succeeding law).
Section 1.5 Event of Default means an event or condition
described in Article V.
Section 1.6 Independent Counsel means legal counsel mutually
satisfactory to both the Lender and the Borrower.
Section 1.7 Loan means the loan described in section 2.1.
Section 1.8 Loan Documents means, collectively, this Loan
Agreement, the Promissory Note and the Pledge Agreement and all other documents
now or hereafter executed and delivered in connection with such documents,
including all amendments, modifications and supplements of or to all such
documents.
Section 1.9 Pledge Agreement means the agreement described in
section 2.7.
Section 1.10 Principal Amount means the face amount of the
Promissory Note, determined as set forth in section 2.1(a).
Section 1.11 Promissory Note means the promissory note
described in section 2.3.
Section 1.12 Register means the register described in section
2.8.
ARTICLE II
THE LOAN; PRINCIPAL AMOUNT;
INTEREST; SECURITY
Section 2.1 The Loan; Principal Amount; Repayment of
Outstanding Indebtedness.
6
3-
(a) The Lender hereby lends to the Borrower EIGHTEEN MILLION
SIX HUNDRED FOURTEEN THOUSAND EIGHT HUNDRED THIRTY-THREE DOLLARS AND TWENTY-NINE
CENTS ($18,614,833.29). For all purposes of this Loan Agreement, the Principal
Amount on any date shall be equal to the excess, if any, of:
(i) the aggregate amount lent by the Lender pursuant to
this section 2.1; over
(ii) the aggregate amount of any repayments of such
amount made before such date.
The Lender shall maintain on the Register a record of, and shall record on the
Promissory Note, the Principal Amount, any changes in the Principal Amount and
the effective date of any changes in the Principal Amount.
(b) Concurrently with the execution and delivery of this
Agreement, the Lender shall deliver to the Borrower the Borrower's original
promissory note issued pursuant to the Prior Agreement and evidencing the
Outstanding Indebtedness marked "PAID IN FULL".
(c) The transactions contemplated by this Agreement shall be
deemed a refinancing of the Outstanding Indebtedness for purposes of Treasury
Regulation ss. 54.4975-7.
Section 2.2 Interest.
(a) The Borrower shall pay to the Lender interest on the
Principal Amount, for the period commencing on the date of this Loan Agreement
and continuing until the Principal Amount shall be paid in full, at the rate of
six percent (6.00%) per annum. Interest payable under this Agreement for any
calendar month period shall be computed on the basis of a year of 360 days and
months consisting of 30 days each. For any period shorter than one calendar
month, interest payable under this Loan Agreement shall be computed on the basis
of a rate equal to six percent (6.00%) multiplied by a fraction equal to the
actual number of days in the period (including the first day but excluding the
last) divided by 360. The Lender shall remit to the Borrower, at least three (3)
Business Days before the end of each calendar year, a statement of the accrued
interest for such calendar year and the aggregate accrued and unpaid interest as
of the last day of such calendar year; provided, however, that a delay or
failure by the Lender in providing the Borrower with such statement shall not
alter the Borrower's obligation to make any payment of interest that may be due
but shall excuse any error in the computation of the amount of interest due that
is promptly cured upon receipt of written notice of such error from the Lender.
Accrued and unpaid interest shall cumulate until paid but shall not be
compounded.
(b) Anything in this Loan Agreement or the Promissory Note to
the contrary notwithstanding, the obligation of the Borrower to make payments of
interest shall be subject to the limitation that payments of interest shall not
be required to be made to the Lender to the extent that the Lender's receipt
thereof would not be permissible under the law or laws applicable to the Lender
7
4-
limiting rates of interest which may be charged or collected by the Lender. Any
such payment referred to in the preceding sentence shall be made by the Borrower
to the Lender on the earliest interest payment date or dates on which the
receipt thereof would be permissible under the laws applicable to the Lender
limiting rates of interest which may be charged or collected by the Lender. Such
deferred interest shall not bear interest.
Section 2.3 Promissory Note.
The Loan shall be evidenced by a Promissory Note of the
Borrower in substantially the form of Exhibit 1 attached hereto, dated January
1, 2000, payable to the order of the Lender in the Principal Amount and
otherwise duly completed.
Section 2.4 Payment of Loan.
The Loan shall be repaid in annual installments payable on the
last Business Day of each December ending after the date of this Agreement. The
amount (if any) of each such annual installment shall be equal to the maximum
amount of principal and interest accrued to and including the date of the
payment that may be paid without resulting in the release for allocation to
participants in the ESOP, pursuant to the Pledge Agreement, of a fraction of the
Shares pledged as collateral security pursuant to the Pledge Agreement as of the
first day of the calendar year in which the payment is made that is greater than
the fraction set forth in Column II below:
Column I Column II
Year of Payment Fraction of
Collateral Released
2000 1/30
2001 1/29
2002 1/28
2003 1/27
2004 1/26
2005 1/25
2006 1/24
2007 1/23
2008 1/22
2009 1/21
2010 1/20
2011 1/19
2012 1/18
2013 1/17
8
5-
Column I Column II
Year of Payment Fraction of
Collateral Released
2014 1/16
2015 1/15
2016 1/14
2017 1/13
2018 1/12
2019 1/11
2020 1/10
2021 1/9
2022 1/8
2023 1/7
2024 1/6
2025 1/5
2026 1/4
2027 1/3
2028 1/2
2029 1
provided, however, that the Borrower shall not be required to make any payment
of principal due to be made in any period to the extent that such payment would
not be deductible for federal income tax purposes under section 404 of the Code.
Payments may be deferred to the extent that such payments would be in excess of
the amount described above or otherwise would be nondeductible for federal
income tax purposes. Any payment shall be applied first to the payment of
accrued interest and second, if and to the extent that all accrued interest has
been or is then being paid, to the payment of all or part of the Principal
Amount.
Section 2.5 Prepayment.
(a) The Borrower may, with the prior written consent of the
Lender, prepay the Loan in whole or in part, at any time and from time to time.
Any such prepayment shall be: (i) permanent and irrevocable; (ii) made without
premium or penalty; and (iii) applied first to the payment of accrued interest
and second, if and to the extent that all accrued interest has been or is then
being paid, to the payment of all or part of the Principal Amount.
(b) For each calendar year after 1999 during which the Loan is
outstanding, a mandatory prepayment of all or part of the Loan (the "Mandatory
Prepayment") shall be made if the
9
6-
aggregate Fair Market Value (as hereinafter defined) of the Shares pledged
pursuant to the Pledge Agreement and pursuant to the Pledge Agreement of even
date herewith between The Long Island Savings Bank FSB Employee Stock Ownership
Plan Trust, acting by and through its Trustee, CG Trust Company and the Lender
(the "LISB Pledge Agreement"), and released pursuant to sections 4(b) and 7 of
the Pledge Agreement and pursuant to sections 4(b) and 7 of the LISB Pledge
Agreement, and allocated to the accounts of participants in the ESOP as a result
of the payments described in sections 2.4 and 2.5(a) of this Loan Agreement and
the payments described in Section 2.4 and 2.5(a) of the Loan Agreement of even
date herewith between The Long Island Savings Bank FSB Employee Stock Ownership
Plan Trust, acting by and through its Trustee, CG Trust Company and the Lender
(the "LISB Loan Agreement") for such calendar year is less than an amount equal
to 14% of the total compensation taken into account under the ESOP for the
purpose of allocations to the accounts of participants in the ESOP of Shares
pledged pursuant to the Pledge Agreement and the LISB Pledge Agreement ("Minimum
Annual Release Value"). The amount of the Mandatory Prepayment for any calendar
year shall be equal to that amount of principal and/or interest which, when
added to the payment described in sections 2.4 and 2.5(a) of this Loan Agreement
and the payments described in sections 2.4, 2.5(a) and 2.5(b) of the LISB Loan
Agreement made or then being made for such calendar year, will result in the
release for allocation to participant accounts of the lesser of (A) a number of
Shares pledged pursuant to the Pledge Agreement and the LISB Pledge Agreement
with an aggregate Fair Market Value equal to the Minimum Annual Release Value or
(B) the entire number of Shares pledged pursuant to the Pledge Agreement and the
LISB Pledge Agreement that are currently unallocated. For purposes of this
section 4(c), the "Fair Market Value" of a Share for any year shall be equal to
the average of the closing sales prices for a share of Share on the Nasdaq Stock
Market National Market System (or other principal national securities exchange
on which Shares are then listed or admitted to trading) on each of the last 20
trading days preceding December 1st of such year on which a sale of a Share
occurs, as reported in the New York City edition Wall Street Journal or such
other reputable source of stock quotations as Astoria Federal Savings and Loan
Association may select.
(c) In the event of the termination of the ESOP or the
occurrence of a "Change in Control (as hereinafter defined), the entire
outstanding Principal Amount and all accrued but unpaid interest shall thereupon
become immediately due and payable. A "Change of Control shall be deemed to have
occurred upon the happening of any of the following events:
(i) any event upon which any "person" (as such term is used in
sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended), other than (A) a trustee or other fiduciary holding
securities under any employee benefit plan maintained for the benefit
of employees of Astoria Financial Corporation; (B) a corporation owned,
directly or indirectly, by the stockholders of Astoria Financial
Corporation in substantially the same proportions as their ownership of
stock of Astoria Financial Corporation; or (C) any group constituting a
person in which employees of Astoria Financial Corporation are
substantial members, becomes the "beneficial owner" (as defined in Rule
13d-3 promulgated under the Exchange Act), directly or indirectly, of
securities issued by Astoria Financial Corporation representing 25% or
more of the combined voting power of all of Astoria Financial
Corporation's then outstanding securities; or
10
7-
(ii) any event upon which the individuals who on December 30,
2000 were members of the Board of Directors of Astoria Financial
Corporation, together with individuals whose election by such Board or
nomination for election by Astoria Financial Corporation's stockholders
was approved by the affirmative vote of at least two-thirds of the
members of such Board then in office who were either members of such
Board on December 30, 2000 or whose nomination or election was
previously so approved, cease for any reason to constitute a majority
of the members of such Board, but excluding, for this purpose, any such
individual whose initial assumption of office is in connection with an
actual or threatened election contest relating to the election of
directors of Astoria Financial Corporation (as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Securities Exchange
Act of 1934);as amended or
(iii) the consummation of either:
(A) a merger or consolidation of Astoria Financial Corporation
with any other corporation, other than a merger or consolidation
following which both of the following conditions are satisfied:
(I) either (1) the members of the Board of Directors
of Astoria Financial Corporation immediately prior to such
merger or consolidation constitute at least a majority of the
members of the governing body of the institution resulting
from such merger or consolidation; or (2) the shareholders of
Astoria Financial Corporation own securities of the
institution resulting from such merger or consolidation
representing 60% or more of the combined voting power of all
such securities then outstanding in substantially the same
proportions as their ownership of voting securities of Astoria
Financial Corporation before such merger or consolidation; and
(II) the entity which results from such merger or
consolidation expressly agrees in writing to assume and
perform Astoria Financial Corporation's obligations under the
ESOP; or
(B) a complete liquidation of Astoria Financial Corporation
or an agreement for the sale or disposition by Astoria
Financial Corporation of all or substantially all of its assets; or
(iv) any event that would be described in this
section if "Astoria Federal Savings and Loan Association"
were substituted for "Astoria Financial Corporation." therein.
Section 2.6 Method of Payments.
11
8-
(a) All payments of principal, interest, other charges and
other amounts payable by the Borrower hereunder shall be made in lawful money of
the United States, in immediately available funds, to the Lender at the address
specified in or pursuant to this Loan Agreement for notices to the Lender, not
later than 3:00 P.M., Eastern Standard time, on the date on which such payment
shall become due. Any such payment made on such date but after such time shall,
if the amount paid bears interest, and except as expressly provided to the
contrary herein, be deemed to have been made on, and interest shall continue to
accrue and be payable thereon until, the next succeeding Business Day. If any
payment of principal or interest becomes due on a day other than a Business Day,
such payment may be made on the next succeeding Business Day.
(b) Notwithstanding anything to the contrary contained in this
Loan Agreement or the Promissory Note, neither the Borrower nor the Trustee
shall be obligated to make any payment, repayment or prepayment on the
Promissory Note or take or refrain from taking any other action hereunder or
under the Promissory Note if doing so would cause the ESOP to cease to be an
employee stock ownership plan within the meaning of section 4975(e)(7) of the
Code or qualified under section 401(a) of the Code or cause the Borrower to
cease to be a tax exempt trust under section 501(a) of the Code or if such act
or failure to act would cause the Borrower or the Trustee to engage in any
"prohibited transaction" as such term is defined in section 4975(c) of the Code
and the regulations promulgated thereunder which is not exempted by section
4975(c)(2) or (d) of the Code and the regulations promulgated thereunder or in
section 406 of ERISA and the regulations promulgated thereunder which is not
exempted by section 408(b) of ERISA and the regulations promulgated thereunder;
provided, however, that in each case, the Borrower or the Trustee or both, as
the case may be, shall have acted or refrained from acting pursuant to this
section 2.6(b) in reliance on an opinion of Independent Counsel. Any opinion of
such Independent Counsel shall be full and complete authorization and protection
in respect of any action taken or suffered or omitted by the Trustee or the
Borrower hereunder in good faith and in accordance with such opinion of
Independent Counsel. Nothing contained in this section 2.6(b) shall be construed
as imposing a duty on either the Borrower or the Trustee to consult with
Independent Counsel. Any obligation of the Borrower or the Trustee to make any
payment, repayment or prepayment on the Promissory Note or to take or refrain
from taking any other act hereunder or under the Promissory Note which is
excused pursuant to this section 2.6(b) shall be considered a binding obligation
of the Borrower or the Trustee, or both, as the case may be, for the purposes of
determining whether a Default or Event of Default has occurred hereunder or
under the Promissory Note and nothing in this section 2.6(b) shall be construed
as providing a defense to any remedies otherwise available upon a Default or an
Event of Default hereunder (other than the remedy of specific performance).
Section 2.7 Security.
(a) In order to secure the due payment and performance by the
Borrower of all of its obligations under this Loan Agreement, simultaneously
with the execution and delivery of this Loan Agreement by the Borrower, the
Borrower shall:
(i) pledge to the Lender as Collateral (as defined in the
Pledge Agreement), and grant to the Lender a first priority lien
on and security interest in,
12
9-
all assets pledged by the Borrower as collateral security for the
Outstanding Indebtedness by the execution and delivery to the
Lender of a Pledge Agreement in the form attached hereto as
Exhibit 2; and
(ii) execute and deliver, or cause to be executed and
delivered, such other agreements, instruments and documents as
the Lender may reasonably require in order to effect the purposes
of the Pledge Agreement and this Loan Agreement.
(b) The Lender shall release from encumbrance under the Pledge
Agreement and transfer to the Borrower, as of the date on which any payment or
prepayment is made, an amount of Collateral determined pursuant to section
Treasury Regulation ss. 54.4975-7(b)(8)(i).
Section 2.8 Registration of the Promissory Note.
(a) The Lender shall maintain a Register providing for the
registration of the Principal Amount and any stated interest and of transfer and
exchange of the Promissory Note. Transfer of the Promissory Note may be effected
only by the surrender of the old instrument and either the reissuance by the
Borrower of the old instrument to the new holder or the issuance by the Borrower
of a new instrument to the new holder. The old Promissory Note so surrendered
shall be canceled by the Lender and returned to the Borrower after such
cancellation.
(b) Any new Promissory Note issued pursuant to section 2.8(a)
shall carry the same rights to interest (unpaid and to accrue) carried by the
Promissory Note so transferred or ex changed so that there will not be any loss
or gain of interest on the note surrendered. Such new Promissory Note shall be
subject to all of the provisions and entitled to all of the benefits of this
Agreement. Prior to due presentment for registration or transfer, the Borrower
may deem and treat the registered holder of any Promissory Note as the holder
thereof for purposes of payment and all other purposes. A notation shall be made
on each new Promissory Note of the amount of all payments of principal and
interest theretofore paid.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
The Borrower hereby represents and warrants to the Lender as follows:
Section 3.1 Power, Authority, Consents.
13
10-
The Borrower has the power to execute, deliver and perform
this Loan Agreement, the Promissory Note and the Pledge Agreement, all of which
have been duly authorized by all neces sary and proper corporate or other
action.
Section 3.2 Due Execution, Validity, Enforceability.
Each of the Loan Documents, including, without limitation,
this Loan Agreement, the Promissory Note and the Pledge Agreement, have been
duly executed and delivered by the Borrower; and each constitutes the valid and
legally binding obligation of the Borrower, enforceable in accordance with its
terms.
Section 3.3 Properties, Priority of Liens.
The liens which have been created and granted by the Pledge
Agreement constitute valid, first liens on the properties and assets covered by
the Pledge Agreement, subject to no prior or equal lien.
Section 3.4 No Defaults, Compliance with Laws.
The Borrower is not in default in any material respect under
any agreement, ordinance, resolution, decree, bond, note, indenture, order or
judgment to which it is a party or by which it is bound, or any other agreement
or other instrument by which any of the properties or assets owned by it is
materially affected.
Section 3.5 Marketable Title; Legality.
The Borrower has valid, legal and marketable title to all of
the Shares and other assets pledged as collateral pursuant to the Pledge
Agreement, free and clear of any liens, other than a pledge to the Lender of
such assets pursuant to the Pledge Agreement. Neither the execution and delivery
of the Loan Documents nor the performance of any obligation thereunder violates
any provision of law or conflicts with or results in a breach of or creates
(with or without the giving of notice or lapse of time, or both) a default under
any agreement to which the Borrower is a party or by which it is bound or any of
its properties is affected. No consent of any federal, state or local
governmental authority, agency or other regulatory body, the absence of which
could have a materially adverse effect on the Borrower or the Trustee, is or was
required to be obtained in connection with the execution, delivery or
performance of the Loan Documents and the transactions contemplated therein or
in connection therewith, including, without limitation, with respect to the
transfer of the Shares purchased with the proceeds of the Loan pursuant thereto.
ARTICLE IV
14
11-
REPRESENTATIONS AND WARRANTIES OF THE LENDER
The Lender hereby represents and warrants to the Borrower as follows:
Section 4.1 Power, Authority, Consents.
The Lender has the power to execute, deliver and perform this
Loan Agreement, the Pledge Agreement and all documents executed by the Lender in
connection with the Loan, all of which have been duly authorized by all
necessary and proper corporate or other action. No consent, authorization or
approval or other action by any governmental authority or regulatory body, and
no notice by the Lender to, or filing by the Lender with, any governmental
authority or regulatory body is required for the due execution, delivery and
performance of this Loan Agreement.
Section 4.2 Due Execution, Validity, Enforceability.
This Loan Agreement and the Pledge Agreement have been duly
executed and delivered by the Lender; and each constitutes a valid and legally
binding obligation of the Lender, enforceable in accordance with its terms.
Section 4.3 ESOP; Contributions.
The ESOP and the Borrower have been duly created, organized
and maintained by the Lender in compliance with all applicable laws, regulations
and rulings. The ESOP qualifies as an "employee stock ownership plan" as defined
in section 4975(e)(7) the Code. The ESOP provides that the Lender may make
contributions to the ESOP in an amount necessary to enable the Trustee to
amortize the Loan in accordance with the terms of the Promissory Note and this
Loan Agreement, and the Lender will make such contributions; provided, however,
that no such contributions shall be required if they would adversely affect the
qualification of the ESOP under section 401(a) of the Code.
Section 4.4 Compliance with Laws; Actions.
Neither the execution and delivery by the Lender of this Loan
Agreement or any instruments required thereby, nor compliance with the terms and
provisions of any such documents by the Lender, constitutes a violation of any
provision of any law or any regulation, order, writ, injunction or decree of any
court or governmental instrumentality, or an event of default under any
agreement, to which the Lender is a party or by which the Lender is bound or to
which the Lender is subject, which violation or event of default would have a
material adverse effect on the Lender. There is no action or proceeding pending
or threatened against either of the ESOP or the Borrower before any court or
administrative agency.
15
12-
ARTICLE V
EVENTS OF DEFAULT
Section 5.1 Events of Default under Loan Agreement.
Each of the following events shall constitute an "Event of Default" hereunder:
(a) Failure to make any payment or mandatory prepayment of
principal of the Promissory Note, or failure to make any payment of interest on
the Promissory Note, within five (5) Business Days after the date when due;
provided, however, that a default shall be deemed to have occurred only if and
to the extent that the Borrower has received a contribution from the Lender to
be used to make such payment or the Borrower has received dividends which it is
permitted to apply to make such payment and the Borrower fails to apply such
contribution or dividends to such payment.
Section 5.2 Lender's Rights upon Event of Default.
If an Event of Default under this Loan Agreement shall occur
and be continuing, the Lender shall have no rights to assets of the Borrower
other than: (a) contributions (other than contributions of Common Stock) that
are made by the Lender to enable the Borrower to meet its obligations pursuant
to this Loan Agreement and earnings attributable to the investment of such
contributions and (b) "Eligible Collateral" (as defined in the Pledge
Agreement); provided, however, that: (i) the value of the Borrower's assets
transferred to the Lender following an Event of Default in satisfaction of the
due and unpaid amount of the Loan shall not exceed the amount in default
(without regard to amounts owing solely as a result of any acceleration of the
Loan); (ii) the Borrower's assets shall be transferred to the Lender following
an Event of Default only to the extent of the failure of the Borrower to meet
the payment schedule of the Loan resulting from the failure of the Borrower to
use dividend income received by it on Pledged Shares and employer contributions
received by it for purposes of debt service to make Loan payments when due; and
(iii) all rights of the Lender to the Collateral covered by the Pledge Agreement
following an Event of Default shall be governed by the terms of the Pledge
Agreement.
ARTICLE VI
MISCELLANEOUS PROVISIONS
16
13-
Section 6.1 Payments.
All payments hereunder and under the Promissory Note shall be
made without set-off or counterclaim and in such amounts as may be necessary in
order that all such payments shall not be less than the amounts otherwise
specified to be paid under this Loan Agreement and the Promissory Note, subject
to any applicable tax withholding requirements. Upon payment in full of the
Promissory Note, the Lender shall ▇▇▇▇ such Promissory Note "PAID IN FULL" and
return it to the Borrower.
Section 6.2 Survival.
All agreements, representations and warranties made herein
shall survive the delivery of this Loan Agreement and the Promissory Note.
Section 6.3 Modifications, Consents and Waivers; Entire
Agreement.
No modification, amendment or waiver of or with respect to any
provision of this Loan Agreement, the Promissory Note, the Pledge Agreement, or
any of the other Loan Documents, nor consent to any departure from any of the
terms or conditions thereof, shall in any event be effective unless it shall be
in writing and signed by the party against whom enforcement thereof is sought.
Any such waiver or consent shall be effective only in the specific instance and
for the purpose for which given. No consent to or demand on a party in any case
shall, of itself, entitle it to any other or further notice or demand in similar
or other circumstances. This Loan Agreement embodies the entire agreement and
understanding between the Lender and the Borrower and supersedes all prior
agreements and understandings relating to the subject matter hereof.
Section 6.4 Remedies Cumulative.
Each and every right granted to the Lender hereunder or under
any other document delivered hereunder or in connection herewith, or allowed it
by law or equity, shall be cumulative and may be exercised from time to time. No
failure on the part of the Lender or the holder of the Promissory Note to
exercise, and no delay in exercising, any right shall operate as a waiver
thereof, nor shall any single or partial exercise of any right preclude any
other or future exercise thereof or the exercise of any other right. The due
payment and performance of the obligations under the Loan Documents shall be
without regard to any counterclaim, right of offset or any other claim
whatsoever which the Borrower may have against the Lender and without regard to
any other obligation of any nature whatsoever which the Lender may have to the
Borrower, and no such counterclaim or offset shall be asserted by the Borrower
in any action, suit or proceeding instituted by the Lender for payment or
performance of such obligations.
Section 6.5 Further Assurances; Compliance with Covenants.
At any time and from time to time, upon the request of the
Lender, the Borrower shall execute, deliver and acknowledge or cause to be
executed, delivered and acknowledged, such
17
14-
further documents and instruments and do such other acts and things as the
Lender may reasonably request in order to fully effect the terms of this Loan
Agreement, the Promissory Note, the Pledge Agreement, the other Loan Documents
and any other agreements, instruments and documents delivered pursuant hereto or
in connection with the Loan.
Section 6.6 Notices.
Except as otherwise specifically provided for herein, all
notices, requests, reports and other communications pursuant to this Loan
Agreement shall be in writing, either by letter (delivered by hand or commercial
messenger service or sent by registered or certified mail, return receipt
requested, except for routine reports delivered in compliance with Article VI
hereof which may be sent by ordinary first-class mail) or telex or facsimile,
addressed as follows:
(a) If to the Borrower:
Astoria Federal Savings and Loan Association
Employee Stock Ownership Plan Trust
c/o State Street Bank and Trust Company
Investment Services ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
with copies to:
Astoria Federal Savings and Loan Association
Employee Stock Ownership Plan Trust
c/o Astoria Federal Savings and Loan Association
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
(b) If to the Lender:
Astoria Financial Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Any notice, request or communication hereunder shall be deemed to have been
given on the day on which it is delivered by hand or by commercial messenger
service, or sent by telex or facsimile, to such party at its address specified
above, or, if sent by mail, on the third Business Day after the day deposited in
the mail, postage prepaid, addressed as aforesaid. Any party may change the
person or address to whom or which notices are to be given hereunder, by notice
duly given hereunder;
18
15-
provided, however, that any such notice shall be deemed to have been given only
when actually received by the party to whom it is addressed.
Section 6.8 Counterparts.
This Loan Agreement may be signed in any number of
counterparts which, when taken together, shall constitute one and the same
document.
Section 6.9 Construction; Governing Law.
The headings used in the table of contents and in this Loan
Agreement are for convenience only and shall not be deemed to constitute a part
hereof. All uses herein of any gender or of singular or plural terms shall be
deemed to include uses of the other genders or plural or singular terms, as the
context may require. All references in this Loan Agreement to an Article or
section shall be to an Article or section of this Loan Agreement, unless
otherwise specified. This Loan Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York applicable to
contracts to be performed wholly within the State of New York entered into
between parties all of whom are citizens and residents of the State of New York.
It is intended that the transactions contemplated by this Loan Agreement
constitute an "exempt loan" within the meaning of Treasury Regulation ss.
54.4975-7(b)(1)(iii) and Department of Labor Regulation ss. 2550.408b-3, and the
provisions hereof shall be construed and enforced in such manner as shall be
necessary to give effect to such intent.
Section 6.10 Severability.
Wherever possible, each provision of this Loan Agreement shall
be interpreted in such manner as to be effective and valid under applicable law;
however, the provisions of this Loan Agreement are severable, and if any clause
or provision hereof shall be held invalid or unenforceable in whole or in part
in any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction and shall not in
any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision in this Loan Agreement in any jurisdiction. Each of
the covenants, agreements and conditions contained in this Loan Agreement is
independent, and compliance by a party with any of them shall not excuse
non-compliance by such party with any other. The Borrower shall not take any
action the effect of which shall constitute a breach or violation of any
provision of this Loan Agreement.
Section 6.11 Binding Effect; No Assignment or Delegation.
This Loan Agreement shall be binding upon and inure to the
benefit of the Borrower and its successors and the Lender and its successors and
assigns. The rights and obligations of the Borrower under this Agreement shall
not be assigned or delegated without the prior written consent of the Lender,
and any purported assignment or delegation without such consent shall be void.
19
16-
IN WITNESS WHEREOF, the parties hereto have caused this Loan
Agreement to be duly executed as of the date first above written.
ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
EMPLOYEE STOCK OWNERSHIP PLAN TRUST
By STATE STREET BANK AND TRUST COMPANY,
solely as Trustee and not in any other
capacity
By: /S/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
ASTORIA FINANCIAL CORPORATION
By: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and General Counsel
20
EXHIBIT 1
PROMISSORY NOTE
$18,614,833.29 Lake Success, New York
January 1, 2000
FOR VALUE RECEIVED, the undersigned, ASTORIA FEDERAL SAVINGS
AND LOAN ASSOCIATION EMPLOYEE STOCK OWNERSHIP PLAN TRUST (the "Borrower"),
acting through and by its Trustee, STATE STREET BANK AND TRUST COMPANY (the
"Trustee"), hereby promises to pay to the order of ASTORIA FINANCIAL CORPORATION
(the "Lender") the sum of EIGHTEEN MILLION SIX HUNDRED FOURTEEN THOUSAND EIGHT
HUNDRED THIRTY-THREE DOLLARS AND TWENTY-NINE CENTS ($18,614,833.29) payable in
annual installments, each of which shall be in the amount determined pursuant to
sections 2.4 and 2.5(b) of the Amended and Restated Loan Agreement made and
entered into as of January 1, 2000 by and between the Borrower and the Lender
(the "Loan Agreement"), as of the last Business Day of December, 2000 and as of
the last Business Day of each December thereafter, through and including the
last business day of December 2029, at which date the entire principal amount
then outstanding shall be due and payable. Principal payments may be deferred,
in whole or in part, to the extent provided in the Loan Agreement.
This Promissory Note shall bear interest at the rate of six
percent (6.00%) per annum set forth or established under the Loan Agreement from
the date of the Loan Agreement, such interest to be payable at the time and in
the manner set forth in the Loan Agreement commencing on the last Business Day
of 2000 and thereafter on the last Business Day of each succeeding calendar
year. Interest accrued shall cumulate until paid but shall not be compounded.
Anything herein to the contrary notwithstanding, the
obligation of the Borrower to make payments of interest shall be subject to the
limitation that payments of interest shall not be required to be made to the
Lender to the extent that the Lender's receipt thereof would not be permissible
under the law or laws applicable to the Lender limiting rates of interest which
may be charged or collected by the Lender. Any such payments of interest which
are not made as a result of the limitation referred to in the preceding sentence
shall be made by the Borrower to the Lender on the earliest interest payment
date or dates on which the receipt thereof would be permissible under the laws
applicable to the Lender limiting rates of interest which may be charged or
collected by the Lender. Such deferred interest shall not bear interest.
Payments of both principal and interest on this Promissory
Note are to be made at the principal office of the Lender at One ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or such other place as the holder hereof
shall designate to the Borrower in writing, in lawful money of the United States
of America in immediately available funds.
21
Failure to make any payment of principal on this Promissory
Note, or failure to make any payment of interest on this Promissory Note, not
later than five (5) Business Days after the date when due, shall constitute a
default hereunder, whereupon the principal amount of and accrued interest on
this Promissory Note shall immediately become due and payable in accordance
with, but also subject to the limitations set forth in, the terms of the Loan
Agreement.
This Promissory Note is subject, in all respects, to the terms
and provisions of the Loan Agreement, which is incorporated herein by this
reference, and is secured by a Pledge Agreement between the Borrower and the
Lender of even date herewith and is entitled to the benefits thereof.
ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
EMPLOYEE STOCK OWNERSHIP PLAN TRUST
By: State Street Bank and Trust Company,
solely as Trustee and not in any other
capacity
By:
Name:
Title:
22
EXHIBIT 2
PLEDGE AGREEMENT
This PLEDGE AGREEMENT ("Pledge Agreement") is made as of the
1st day of January, 2000, by and between the ASTORIA FEDERAL SAVINGS AND LOAN
ASSOCIATION EMPLOYEE STOCK OWNERSHIP PLAN TRUST, acting by and through its
Trustee, STATE STREET BANK AND TRUST COMPANY, a banking corporation organized
under the laws of the Massachusetts ("Pledgor"), and ASTORIA FINANCIAL
CORPORATION ("Pledgee"), a corporation organized and existing under the laws of
the State of Delaware.
W I T N E S S E T H :
--------------------
WHEREAS, this Pledge Agreement is being executed and delivered
to the Pledgee pursuant to the terms of An Amended and Restated Loan Agreement
of even date herewith ("Loan Agreement"), by and between the Pledgor and the
Pledgee;
NOW, THEREFORE, in consideration of the mutual agreements
contained herein and in the Loan Agreement, the parties hereto do hereby
covenant and agree as follows:
Section 1. Definitions. The following definitions shall apply
for purposes of this Pledge Agreement, except to the extent that a different
meaning is plainly indicated by the context; all capitalized terms used but not
defined herein shall have the respective meanings assigned to them in the Loan
Agreement:
(a) "Collateral" shall mean the Pledged Shares and the Pledged
Assets and, subject to section 5 hereof, and to the extent permitted by
applicable law, all rights with respect thereto, and all proceeds of
such Pledged Shares, Pledged Assets and rights.
(b) "Event of Default" shall mean an event so defined in the
Loan Agreement.
(c) "Liabilities" shall mean all the obligations of the
Pledgor to the Pledgee, howsoever created, arising or evidenced,
whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due, under the Loan Agreement and the
Promissory Note.
(d) "Pledged Assets" means all assets of the Borrower pledged,
as of January 1, 2000, as collateral security for the Borrower's
performance of its obligations under that certain Loan Agreement
between the Borrower and the Lender dated April 14, 1994, excluding any
Pledged Shares.
1
23
(e) "Pledged Shares" shall mean all the shares of common
stock, par value $ .01 per share, of Astoria Financial Corporation
purchased by the Pledgor with the proceeds of the loan made by the
Pledgee to the Pledgor pursuant to the Loan Agreement dated April 14,
1994, but excluding any such shares previously released pursuant to
section 4.
Section 2. Pledge. To secure the payment of and performance
of all the Liabilities, the Pledgor hereby pledges to the Pledgee, and grants to
the Pledgee a security interest in and lien upon the Collateral.
Section 3. Representations and Warranties of the Pledgor. The
Pledgor represents, warrants, and covenants to the Pledgee as follows:
(a) to the actual knowledge of the Trustee, the execution,
delivery and performance of this Pledge Agreement and the pledging of
the Collateral hereunder do not and will not conflict with, result in a
violation of, or constitute a default under any agreement binding upon
the Pledgor;
(b) the Pledged Shares are and will continue to be owned by
the Pledgor free and clear of any liens or rights of any other person
except the lien hereunder and under the Loan Agreement in favor of the
Pledgee, and the security interest of the Pledgee in the Pledged Shares
and the proceeds thereof is and will continue to be prior to and senior
to the rights of all others;
(c) to the actual knowledge of the Trustee, this Pledge
Agreement is the legal, valid and binding obligation of the Pledgor and
is enforceable against the Pledgor in accordance with its terms;
(d) the Pledgor shall, from time to time, upon request of the
Pledgee, promptly deliver to the Pledgee such financing statements,
stock powers, proxies, and similar documents, satisfactory in form and
substance to the Pledgee, with respect to the Collateral as the Pledgee
may reasonably request; and
(e) subject to the first sentence of section 4(b), the Pledgor
shall not, so long as any Liabilities are outstanding, sell, assign,
exchange, pledge or otherwise transfer or encumber any of its rights in
and to any of the Collateral.
Section 4. Eligible Collateral.
(a) As used herein the term "Eligible Collateral" shall mean
that amount of Collateral which has an aggregate fair market value equal to the
amount by which the Pledgor is in default (without regard to any amounts owing
solely as the result of an acceleration of the Loan
2
24
Agreement) or such lesser amount of Collateral as may be required pursuant to
section 12 of this Pledge Agreement.
(b) The Collateral shall be released from this Pledge
Agreement in a manner conforming to the requirements of Treasury Regulation ss.
54.4975-7(b)(8)(i), as the same may be from time to time amended or
supplemented. In the event of a termination of the ESOP or the occurrence of a
Change in Control after December 31, 2009, all Pledged Shares shall be forthwith
released from this Pledge Agreement and shall not be applied to satisfy any
Liabilities. In the event of a Change in Control prior to January 1, 2010, all
Pledged Shares in excess of the number determined under the following table
shall be forthwith released from this Pledge Agreement and shall not be applied
to satisfy any Liabilities:
YEAR OF PLEDGED YEAR OF PLEDGED
CHANGE SHARES CHANGE SHARES
IN IN
CONTROL CONTROL
-------- --------- -------- -------
2001 1,048,266 2006 0
2002 827,371 2007 0
2003 606,476 2008 0
2004 385,581 2009 0
2005 164,686
To the extent that the Collateral consists of assets other than or in addition
to Pledged Shares, the provisions of such Regulations shall be applied
separately to each class of security or each class or other type of asset
included in the Collateral. Subject to such Regulations, the Pledgee may from
time to time, after any Default or Event of Default, and without prior notice to
the Pledgor, transfer all or any part of the Eligible Collateral into the name
of the Pledgee or its nominee, with or without disclosing that such Eligible
Collateral is subject to any rights of the Pledgor and may from time to time,
whether before or after any of the Liabilities shall become due and payable,
without notice to the Pledgor, take all or any of the following actions: (i)
notify the parties obligated on any of the Collateral to make payment to the
Pledgee of any amounts due or to become due thereunder, (ii) release or exchange
all or any part of the Collateral, or compromise or extend or renew for any
period (whether or not longer than the original period) any obligations of any
nature of any party with respect thereto, and (iii) take control of any proceeds
of the Collateral.
Section 5. Delivery; Further Assurances.
(a) The Pledgor shall deliver to the Pledgee upon execution of
this Pledge Agreement an assignment by the Pledgor of all the Pledgor's rights
to and interest in the Collateral.
(b) So long as no Default or Event of Default shall have
occurred and be continuing, (i) the Pledgor shall be entitled to exercise any
and all voting and other rights pertaining to the
3
25
Collateral or any part thereof for any purpose not inconsistent with the terms
of this Pledge Agreement, and (ii) the Pledgor shall be entitled to receive any
and all cash dividends or other distributions paid in respect of the Collateral.
(c) For so long as this Pledge Agreement shall be in effect,
the Pledgor shall take such other actions and execute and deliver such other
documents as the Pledgee may reasonably request in order to secure for the
Pledgee's benefit a perfected first priority lien and security interest in any
or all of the Collateral under the New York Uniform Commercial Code; provided,
however, that the Pledgee shall not be required to take any action or execute or
deliver any document pursuant to this section 5(c) to the extent that it
determines, in reliance on an opinion of legal counsel, that the taking of such
action or the execution or delivery of such document would result in a
prohibited transaction under section 4975 of the Code or section 406 of ERISA,
impair the status of the ESOP as a tax-qualified plan under section 401(a) of
the Code or an employee stock ownership plan under section 4975 of the Code,
impair the tax-exempt status of the Borrower under section 501(a) of the Code or
violate any other requirement of ERISA applicable to the ESOP.
Section 6. Events of Default.
(a) If a Default or an Event of Default shall be existing, in
addition to the rights it may have under the Loan Agreement, the Promissory
Note, and this Pledge Agreement, or by virtue of any other instrument, (i) the
Pledgee may exercise, with respect to Eligible Collateral, from time to time any
rights and remedies available to it under the Uniform Commercial Code as in
effect from time to time in the State of New York or otherwise available to it
and (ii) the Pledgee shall have the right, for and in the name, place and stead
of the Pledgor, to execute endorsements, assignments, stock powers and other
instruments of conveyance or transfer with respect to all or any of the Eligible
Collateral. Written notification of intended disposition of any of the Eligible
Collateral shall be given by the Pledgee to the Pledgor at least three (3)
Business Days before such disposition. Subject to section 13 below, any proceeds
of any disposition of Eligible Collateral may be applied by the Pledgee to the
payment of expenses in connection with the Eligible Collateral, including,
without limitation, reasonable attorneys' fees and legal expenses, and any
balance of such proceeds may be applied by the Pledgee toward the payment of
such of the Liabilities as are in Default, and in such order of application, as
the Pledgee may from time to time elect. No action of the Pledgee permitted
hereunder shall impair or affect its rights in and to the Eligible Collateral.
All rights and remedies of the Pledgee expressed hereunder are in addition to
all other rights and remedies possessed by it, including, without limitation,
those contained in the documents referred to in the definition of Liabilities in
section 1 hereof.
(b) In any sale of any of the Eligible Collateral after a
Default or an Event of Default shall have occurred, the Pledgee is hereby
authorized to comply with any limitation or restriction in connection with such
sale as it may be advised by counsel is necessary in order to avoid any
violation of applicable law (including, without limitation, compliance with such
procedures as may restrict the number of prospective bidders and purchasers or
further restrict such prospective bidders or purchasers to persons who will
represent and agree that they are purchasing for their own account for
investment and not with a view to the distribution or resale of such Eligible
Collateral),
4
26
or in order to obtain such required approval of the sale or of the purchase by
any governmental regulatory authority or official, and the Pledgor further
agrees that such compliance shall not result in such sale's being considered or
deemed not to have been made in a commercially reasonable manner, nor shall the
Pledgee be liable or accountable to the Pledgor for any discount allowed by
reason of the fact that such Eligible Collateral is sold in compliance with any
such limitation or restriction.
Section 7. Payment in Full. Upon the payment in full of all
outstanding Liabili ties, this Pledge Agreement shall terminate and the Pledgee
shall forthwith assign, transfer and deliver to the Pledgor, against receipt and
without recourse to the Pledgee, all Collateral then held by the Pledgee
pursuant to this Pledge Agreement.
Section 8. No Waiver. No failure or delay on the part of the
Pledgee in exer cising any right or remedy hereunder or under any other document
which confers or grants any rights in the Pledgee in respect of the Liabilities
shall operate as a waiver thereof nor shall any single or partial exercise of
any such right or remedy preclude any other or further exercise thereof or the
exercise of any other right or remedy of the Pledgee.
Section 9. Binding Effect; No Assignment or Delegation. This
Pledge Agreement shall be binding upon and inure to the benefit of the Pledgor,
the Pledgee and their respective successors and assigns, except that the Pledgor
may not assign or transfer its rights hereunder without the prior written
consent of the Pledgee (which consent shall not unreasonably be withheld). Each
duty or obligation of the Pledgor to the Pledgee pursuant to the provisions of
this Pledge Agreement shall be performed in favor of any person or entity
designated by the Pledgee, and any duty or obligation of the Pledgee to the
Pledgor may be performed by any other person or entity designated by the
Pledgee.
Section 10. Governing Law. This Pledge Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of New York applicable to contracts to be performed wholly within the State of
New York entered into between parties all of whom are citizens and residents of
the State of New York.
Section 11. Notices. All notices, requests, instructions or
documents hereunder shall be in writing and delivered by hand or commercial
messenger service or sent by United States mail, registered or certified, return
receipt requested, with proper postage prepaid, or by telex or facsimile,
addressed as follows:
(a) If to the Pledgee:
Astoria Financial Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
5
27
(b) If to the Pledgor:
Astoria Federal Savings and Loan Association
Employee Stock Ownership Plan Trust
State Street Bank and Trust Company
Investment Services ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
with copies to:
Astoria Federal Savings and Loan Association
Employee Stock Ownership Plan Trust
c/o Astoria Federal Savings and Loan Association
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Any notice, request or communication hereunder shall be deemed to have been
given on the day on which it is delivered by hand or by commercial messenger
service, or sent by telex or facsimile, to such party at its address specified
above, or, if sent by mail, on the third Business Day after the day deposited in
the mail, postage prepaid, addressed as aforesaid. Any party may change the
person or address to whom or which notices are to be given hereunder, by notice
duly given hereunder; provided, however, that any such notice shall be deemed to
have been given only when actually received by the party to whom it is
addressed.
Section 12. Interpretation. Wherever possible each provision
of this Pledge Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision hereof shall be prohibited
by or invalid under such law, such provisions shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions hereof.
Section 13. Construction. All provisions hereof shall be
construed so as to maintain (a) the ESOP as a qualified leveraged employee stock
ownership plan under section 401(a) and 4975(e)(7) of the Internal Revenue Code
of 1986 (the "Code"), (b) the Trust as exempt from taxation under section 501(a)
of the Code and (c) the loan made pursuant to the Loan Agreement as an exempt
loan under Treasury Regulation ss. 54.4975-7(b) and as described in Department
of Labor Regulation ss. 2550.408b-3.
6
28
IN WITNESS WHEREOF, this Pledge Agreement has been duly
executed by the parties hereto as of the day and year first above written.
ASTORIA FEDERAL SAVINGS AND LOAN
ASSOCIATION EMPLOYEE STOCK OWNERSHIP PLAN
TRUST
By STATE STREET BANK AND TRUST COMPANY
solely as Trustee and not in any other
capacity
By:
Name:
Title:
ASTORIA FINANCIAL CORPORATION
By:
Name:
Title:
7