Exhibit 10.2

 

THIRD AMENDMENT TO CREDIT AGREEMENT

 

THIS THIRD AMENDMENT TO CREDIT AGREEMENT (“this Third Amendment”) is made and
entered into as of the 27th day of June, 2005, by and between STANCORP FINANCIAL
GROUP, INC., an Oregon corporation (the “Borrower”), and KEYBANK NATIONAL
ASSOCIATION, a national banking association (the “Bank”).

 

Recitals:

 

A. The Borrower and the Bank are parties to that certain Credit Agreement dated
as of June 30, 2003, as amended by a First Amendment dated July 1, 2003 and by a
Release of Guaranties and Second Amendment dated as of June 28, 2004
(collectively, the “Credit Agreement”), pursuant to which, inter alia, the Bank
agreed, subject to the terms and conditions thereof, to advance the Loan (as
this and other capitalized terms used herein but not otherwise defined herein
are defined in the Credit Agreement) to the Borrower and issue Letters of Credit
at the request of the Borrower.

 

B. On the date hereof, the aggregate unpaid principal balance of the Loan is
$-0-; and the aggregate amount of the Letter of Credit Obligations is $-0-.

 

C. The Borrower has requested that the Bank agree to extend the Expiry Date.

 

D. Subject to the terms and conditions of this Third Amendment, the Bank has
agreed to such request.

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Agreements:

 

NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual
agreements hereinafter set forth, the Borrower and the Bank hereby agree as
follows:

 

1. Amendments to the Credit Agreement. Subject to the terms and conditions of
this Third Amendment, including, without limitation, Paragraph 2, below, the
definitions of “Expiry Date” and “Leverage Ratio” in Section 1.1 of the Credit
Agreement (Defined Terms) are amended and restated in their entirety to provide,
respectively, as follows:

 

“Expiry Date” means June 26, 2006.

 

“Leverage Ratio” means the ratio described in Section 8.11(a).

 

2. Effective Date; Conditions Precedent. The modifications to the Credit
Agreement set forth in Paragraph 1, above, shall not be effective, unless and
until the date on which the Borrower has satisfied all of the following
conditions precedent (such date of effectiveness being the “Effective Date”):

 

(A) On the Effective Date and after giving effect to the releases and
modifications contained herein (i) there shall exist no Default or Event of
Default, and the President, a Senior Vice President or the Chief Financial
Officer of the Borrower shall have delivered to the Bank written confirmation
thereof dated as of the Effective Date and (ii) the representations and
warranties of the Borrower under the Credit Agreement shall have been reaffirmed
in writing as of the Effective Date, subject only to variances therefrom
acceptable to the Bank.

 

(B) The Borrower shall have delivered to the Bank a Certificate of its Secretary
dated as of the Effective Date certifying that attached thereto is a complete
copy of resolutions adopted by the board of directors of the Borrower,
authorizing the execution, delivery and performance of this Third Amendment and
the agreements to be performed by the Borrower hereunder.

 

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(C) All legal matters incident to this Third Amendment and the consummation of
the transactions contemplated hereby shall be reasonably satisfactory to Squire,
Sanders & Dempsey L.L.P., Cleveland, Ohio, special counsel to the Bank (the
“Special Counsel”).

 

(D) The Bank shall have received such other certificates, opinions and
documents, in form and substance satisfactory to it, as it may reasonably
request.

 

3. Other Loan Documents. Any reference to the Credit Agreement in the Note or
the other Loan Documents shall, from and after the Effective Date, be deemed to
refer to the Credit Agreement, as modified by this Third Amendment.

 

4. Confirmation of Debt. The Borrower hereby affirms all of its Indebtedness,
liabilities and obligations to the Bank under the Credit Agreement and the other
Loan Documents, as the same are modified hereby. The Borrower further
acknowledges and agrees that as of the Effective Date, it has no claims,
defenses or set-off rights against the Bank, and there are no claims, defenses
or set-offs to the enforcement by the Bank of the Indebtedness, liabilities and
obligations of the Borrower under the Credit Agreement, the Note or the other
Loan Documents.

 

5. No Other Modifications; Same Indebtedness. Except as expressly provided in
this Third Amendment, all of the terms and conditions of the Credit Agreement,
the Note and the other Loan Documents remain unchanged and in full force and
effect. The modifications effected by this Third Amendment and by any other
instruments contemplated hereby shall not be deemed to provide for or effect a
repayment and re-advance of Indebtedness, if any, now outstanding, it being the
intention of the Borrower and the Bank hereby that the Indebtedness, if any,
owing under the Credit Agreement, as amended by this Third Amendment, be and
hereby is the same Indebtedness as that owing under the Credit Agreement
immediately prior to the effectiveness hereof.

 

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6. Reimbursement of Bank’s Expenses. The Borrower shall reimburse the Bank
promptly for costs and expenses incurred by the Bank in connection with this
Third Amendment, including the fees and expenses of the Special Counsel.

 

7. Governing Law; Binding Effect. This Third Amendment shall be governed by and
construed in accordance with the laws of the State of Ohio and shall be binding
upon and inure to the benefit of the Borrower, the Bank and their respective
successors and assigns.

 

8. Statute of Frauds. Without limiting the selection of governing law provisions
of Section 7, above, under Oregon law, most agreements, promises and commitments
made by a lender after October 3, 1989, concerning loans and other credit
extensions which are not for personal, family or household purposes or secured
solely by the borrower’s residence must be in writing, express consideration and
be signed by the lender to be enforceable.

 

IN WITNESS WHEREOF the Bank and the Borrower have hereunto set their hands as of
the date first above written.

 

STANCORP FINANCIAL GROUP, INC. By  

/s/ Cindy J. McPike

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    Cindy J. McPike, Senior Vice President     and Chief Financial Officer
KEYBANK NATIONAL ASSOCIATION By  

/s/ Mary K. Young

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    Mary K. Young, Vice President     and Portfolio Manager

 

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