EXHIBIT 10.18

 

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CREDIT AGREEMENT

DATED AS OF JANUARY 31, 2006,

BETWEEN

MAF BANCORP, INC.

AND

HARRIS N.A.

 

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TABLE OF CONTENTS

 

SECTION

  

DESCRIPTION

   PAGE

SECTION 1.

   THE CREDITS.    1    Section 1.1.    Revolving Credit.    1    Section 1.2.
   Revolving Credit Loans.    1    Section 1.3.    Letters of Credit    2   
Section 1.4.    Term Credit.    4    Section 1.5.    Manner and Disbursement of
Loans.    5

SECTION 2.

   INTEREST AND CHANGE IN CIRCUMSTANCES.    5    Section 2.1.    Interest Rate
Options.    5    Section 2.2.    Minimum LIBOR Portions.    6    Section 2.3.   
Computation of Interest.    6    Section 2.4.    Manner of Rate Selection.    6
   Section 2.5.    Change of Law.    7    Section 2.6.    Unavailability of
Deposits or Inability to Ascertain Adjusted LIBOR.    7    Section 2.7.    Taxes
and Increased Costs.    7    Section 2.8.    Funding Indemnity    8   
Section 2.9.    Lending Branch.    9    Section 2.10.    Discretion of Lender as
to Manner of Funding.    9

SECTION 3.

   FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.    9    Section 3.1.   
Fees    9    Section 3.2.    Voluntary Prepayments.    10    Section 3.3.   
Mandatory Termination    10    Section 3.4.    Voluntary Terminations.    10   
Section 3.5.    Place and Application of Payments.    10    Section 3.6.   
Notations.    11

SECTION 4.

   DEFINITIONS; INTERPRETATION.    11    Section 4.1.    Definitions.    11   
Section 4.2.    Interpretation.    18

SECTION 5.

   REPRESENTATIONS AND WARRANTIES.    18    Section 5.1.    Organization and
Qualification    18    Section 5.2.    Subsidiaries    19    Section 5.3.   
Corporate Authority and Validity of Obligations    19    Section 5.4.    Use of
Proceeds; Margin Stock    20    Section 5.5.    Financial Reports    20   
Section 5.6.    No Material Adverse Change    20

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   Section 5.7.    Full Disclosure    21   

Section 5.8.

   Good Title    21   

Section 5.9.

   Litigation and Other Controversies    21   

Section 5.10.

   Taxes    21   

Section 5.11.

   Approvals    21   

Section 5.12.

   Affiliate Transactions    22   

Section 5.13.

   Investment Company; Public Utility Holding Company    22   

Section 5.14.

   ERISA    22   

Section 5.15.

   Compliance with Laws    22   

Section 5.16.

   Other Agreements    22   

Section 5.17.

   Merger    23   

Section 5.18.

   No Default.    23

SECTION 6.

   CONDITIONS PRECEDENT    23   

Section 6.1.

   All Advances.    23   

Section 6.2.

   Initial Advance    24

SECTION 7.

   COVENANTS    25   

Section 7.1.

   Maintenance of Business    25   

Section 7.2.

   Maintenance of Properties    25   

Section 7.3.

   Taxes and Assessments    26   

Section 7.4.

   Insurance    26   

Section 7.5.

   Financial Reports    26   

Section 7.6.

   Inspection    28   

Section 7.7.

   Non-Performing Assets    28   

Section 7.8.

   Regulatory Capital Requirements    29   

Section 7.9.

   Adjusted Net Worth    29   

Section 7.10.

   Adjusted Net Income    29   

Section 7.11.

   Indebtedness for Borrowed Money    29   

Section 7.12.

   Liens    30   

Section 7.13.

   Mergers and Consolidations    31   

Section 7.14.

   Maintenance of Subsidiaries    31   

Section 7.15.

   Dividends and Certain Other Restricted Payments    31   

Section 7.16.

   ERISA    31   

Section 7.17.

   Compliance with Laws    31   

Section 7.18.

   Burdensome Contracts With Affiliates    31   

Section 7.19.

   Change in the Nature of Business    32   

Section 7.20.

   Subordinated Debt    32

SECTION 8.

   EVENTS OF DEFAULT AND REMEDIES    32   

Section 8.1.

   Events of Default.    32   

Section 8.2.

   Non-Bankruptcy Defaults.    34   

Section 8.3.

   Bankruptcy Defaults    34   

Section 8.4.

   Collateral for Undrawn Letters of Credit    35

 

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SECTION 9.

   MISCELLANEOUS.    35   

Section 9.1.

   Non-Business Days.    35   

Section 9.2.

   No Waiver, Cumulative Remedies.    35   

Section 9.3.

   Amendments    36   

Section 9.4.

   Costs and Expenses    36   

Section 9.5.

   Documentary Taxes    36   

Section 9.6.

   Survival of Representations    36   

Section 9.7.

   Participations    36   

Section 9.8.

   Notices    37   

Section 9.9.

   Confidentiality    37   

Section 9.10.

   Headings    38   

Section 9.11.

   Severability of Provisions.    38   

Section 9.12.

   Counterparts    38   

Section 9.13.

   Entire Understanding    38   

Section 9.14.

   Binding Nature, Governing Law, Etc    38   

Section 9.15.

   Submission to Jurisdiction; Waiver of Jury Trial    38

Signature

      40

 

Exhibit A

  —      Revolving Credit Note

Exhibit B

  —      Term Note

Exhibit C

  —      Compliance Certificate

Exhibit D

  —      Opinion of Counsel

Schedule 5.2

  —      Significant Subsidiaries

Schedule 7.12

  —      Existing Indebtedness

 

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CREDIT AGREEMENT

Harris N.A.

Chicago, Illinois

Ladies and Gentlemen:

The undersigned, MAF Bancorp, Inc., a Delaware corporation (the “Company”),
applies to you (the “Lender”) for your commitment, subject to the terms and
conditions hereof and on the basis of the representations and warranties
hereinafter set forth, to extend credit to the Company, all as more fully
hereinafter set forth.

SECTION 1. THE CREDITS.

Section 1.1. Revolving Credit. Subject to the terms and conditions hereof, the
Lender agrees to extend a revolving credit (the “Revolving Credit”) to the
Company which may be availed of by the Company from time to time during the
period from and including the date hereof to but not including the Revolving
Credit Termination Date, at which time the commitment of the Lender to extend
credit under the Revolving Credit shall expire. The Revolving Credit may be
utilized by the Company in the form of Revolving Credit Loans and Letters of
Credit, all as more fully hereinafter set forth, provided that the aggregate
principal amount of Revolving Credit Loans and Letters of Credit outstanding at
any one time shall not exceed the Revolving Credit Commitment. During the period
from and including the date hereof to but not including the Revolving Credit
Termination Date, the Company may use the Revolving Credit Commitment by
borrowing, repaying and reborrowing Revolving Credit Loans in whole or in part
and/or by having the Lender issue Letters of Credit, having such Letters of
Credit expire or otherwise terminate without having been drawn upon or, if drawn
upon, reimbursing the Lender for each such drawing, and having the Lender issue
new Letters of Credit, all in accordance with the terms and conditions of this
Agreement. For purposes of this Agreement, where a determination of the unused
or available amount of the Revolving Credit Commitment is necessary, the
Revolving Credit Loans and Letters of Credit shall be deemed to utilize the
Revolving Credit Commitment in an amount equal to the outstanding principal
amounts thereof.

Section 1.2. Revolving Credit Loans. Subject to the terms and conditions hereof,
the Revolving Credit may be availed of by the Company in the form of loans
(individually a “Revolving Credit Loan” and collectively the “Revolving Credit
Loans”). Each Revolving Credit Loan shall be in an amount of $500,000 or such
greater amount which is an integral multiple of $100,000; provided, however,
that a Revolving Credit Loan, or part thereof, which bears interest with
reference to the Adjusted LIBOR shall be in such greater amount as is required
by Section 2.2 hereof. All Revolving Credit Loans made by the Lender shall be
made against and evidenced by a single Revolving Credit Note of the Company (the
“Revolving Credit Note”) payable to the order of the Lender in the amount of its
Revolving Credit Commitment, with the Revolving Credit Note to be in the form
(with appropriate insertions)

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attached hereto as Exhibit A. The Revolving Credit Note shall be dated the date
of issuance thereof and be expressed to bear interest as set forth in Section 2
hereof. The Revolving Credit Note, and all Revolving Credit Loans evidenced
thereby, shall mature and be due and payable on the Revolving Credit Termination
Date. Without regard to the principal amount of the Revolving Credit Note stated
on its face, the actual principal amount at any time outstanding and owing by
the Company on account thereof shall be the sum of all advances then or
theretofore made thereon less all payments of principal actually received.

Section 1.3. Letters of Credit.

(a) General Terms. Subject to the terms and conditions hereof, the Revolving
Credit may be availed of by the Company in the form of standby letters of credit
issued by the Lender for the account of the Company or, at the Company’s option,
for the account of the Company and MAF Developments (and any joint venture in
which MAF Developments is a partner), jointly and severally (individually a
“Letter of Credit” and collectively the “Letters of Credit”), provided that the
aggregate amount of Letters of Credit issued and outstanding hereunder shall not
at any time exceed $30,000,000. For purposes of this Agreement, a Letter of
Credit shall be deemed outstanding as of any time in an amount equal to the
maximum amount which could be drawn thereunder under any circumstances and over
any period of time plus any unreimbursed drawings then outstanding with respect
thereto. If and to the extent any Letter of Credit expires or otherwise
terminates without having been drawn upon, the availability under the Revolving
Credit Commitment shall to such extent be reinstated.

(b) Term. Each Letter of Credit issued hereunder shall expire not later than 18
months from the date of issuance (or be cancelable not later than 18 months from
the date of issuance and each renewal); provided, however, that for any Letter
of Credit with an expiry date extending beyond the Revolving Credit Termination
Date, the Company hereby agrees to (i) deposit cash with the Lender on or before
the Revolving Credit Termination Date in an amount equal to the aggregate amount
of such Letter of Credit or (ii) deposit with the Lender on or before the
Revolving Credit Termination Date investments in direct obligations of the
United States of America or of any agency or instrumentality thereof whose
obligations constitute full faith and credit obligations of the United States of
America in amounts and with such maturities as are acceptable to the Lender, in
each case to be held by the Lender in the Account referred to in Section 8.4
hereof as collateral security for any and all Obligations pursuant to the terms
of Section 8.4 hereof, provided that if the amount of any such Letter of Credit
is thereafter reduced, and so long as no Default or Event of Default has
occurred and is continuing, at the request of the Company, the Lender will
immediately return any cash or investments in the Account, and any proceeds or
earnings on such cash and investments, in excess of the remaining amount of such
Letter of Credit.

(c) General Characteristics. Each Letter of Credit issued hereunder shall be
payable in U.S. Dollars, conform to the general requirements of the Lender for
the issuance of standby letters of credit as to form and substance, and be a
letter of credit which the Lender may lawfully issue.

 

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(d) Applications. At the time the Company requests each Letter of Credit to be
issued (or prior to the first issuance of a Letter of Credit in the case of a
continuing application), the Company shall execute and deliver to the Lender an
application for such Letter of Credit in the form then customarily prescribed by
the Lender (individually an “Application” and collectively the “Applications”).
Subject to the other provisions of this subsection, the obligation of the
Company to reimburse the Lender for drawings under a Letter of Credit shall be
governed by the Application for such Letter of Credit. Anything contained in the
Applications to the contrary notwithstanding, (i) in the event the Lender is not
reimbursed by the Company for the amount the Lender pays on any drawing made
under a Letter of Credit issued hereunder by 2:00 p.m. (Chicago time) on the
date when such drawing is paid, the obligation of the Company to reimburse the
Lender for the amount of such drawing shall bear interest (which the Company
hereby promises to pay on demand) from and after the date the drawing is paid
until payment in full thereof at a fluctuating rate per annum determined by
adding 2.0% to the Base Rate as from time to time in effect (computed on the
basis of a year of 360 days for the actual number of days elapsed), (ii) the
Company shall pay fees in connection with each Letter of Credit as set forth in
Section 3 hereof, (iii) except during the existence of a Default or an Event of
Default, the Lender will not call for additional collateral security for the
obligations of the Company under the Applications except as otherwise provided
in Section 1.3(b) hereof, and (iv) except during the existence of a Default or
an Event of Default, the Lender will not call for the funding of a Letter of
Credit by the Company prior to being presented with a drawing thereunder (or, in
the event the drawing is a time draft, prior to its due date) except as
otherwise provided in Section 1.3(b) hereof.

(e) Change in Laws. If the Lender shall determine that any change in any
applicable law, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any new
law, regulation or guideline, or any interpretation of any of the foregoing by
any governmental authority charged with the administration thereof or any
central bank or other fiscal, monetary or other authority having jurisdiction
over the Lender (whether or not having the force of law), shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against the Letters of Credit, or the Lender’s or the Company’s
liability with respect thereto; or

(ii) impose on the Lender any penalty with respect to the foregoing or any other
condition regarding this Agreement, the Applications or the Letters of Credit;

and the Lender shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to the
Lender of issuing or maintaining the Letters of Credit hereunder (without
benefit of, or credit for, any prorations, exemptions, credits or other offsets
available under any such laws, regulations, guidelines or interpretations
thereof), then the Company shall pay on demand to the Lender from time to time
as specified by the Lender such additional amounts as the Lender shall determine
are sufficient to compensate and indemnify it for such increased cost. If the
Lender makes such a claim for compensation, it shall provide the Company a
certificate setting forth the computation of the increased cost as a

 

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result of any event mentioned herein in reasonable detail and such certificate
shall be conclusive if reasonably determined (absent manifest error).

Section 1.4. Term Credit. As of the date hereof, the Company is indebted to the
Lender in the principal amount of $63,000,000 pursuant to that certain Term Note
of the Company dated November 1, 2004, issued in the original principal amount
of $70,000,000 (the “Prior Term Note”). The Company acknowledges and agrees that
the outstanding amount on the Prior Term Note is owing to the Lender without
defense, offset or counterclaim. Subject to the terms and conditions hereof, the
Lender agrees to make an additional term loan advance to the Company in the
principal amount of $52,000,000 (the “Additional Term Loan”), which shall be
advanced in a single borrowing on or before January 31, 2006, at which time the
commitment of the Lender to make the Additional Term Loan shall expire. The
Additional Term Loan shall be applied by the Company to fund a portion of the
Merger and other valid business purposes. The Additional Term Loan, together
with the aggregate principal balance of the Prior Term Note, shall be combined
into a single term loan so that all such indebtedness from and after January 31,
2006, shall be evidenced by a single promissory note of the Company in the form
attached hereto (with appropriate insertions) as Exhibit B, payable to the order
of the Lender in the principal amount of $115,000,000 (herein, “Term Note”, and
the aggregate principal amount of loans evidenced thereby being referred to
herein as the “Term Loan”). The Term Note is being issued in substitution and
replacement for, and shall evidence the indebtedness heretofore evidenced by,
the Prior Term Note, as well as the Additional Term Loan made hereunder. The
Term Note shall be dated the date of issuance thereof and be expressed to bear
interest as set forth in Section 2 hereof. The Company hereby promises to make
principal payments on the Term Note in installments on the dates set forth in
column A below each in an amount equal to the amount set forth in column B below
opposite the relevant due date:

The Company hereby agrees to repay the balance of the Term Loan in the amounts
and on the dates set forth below:

 

        A

PAYMENT DATE

  

B

SCHEDULED PRINCIPAL

PAYMENT ON TERM NOTE

12/31/2006

   $7,500,000

12/31/2007

   $7,500,000

12/31/2008

   $9,750,000

12/31/2009

   $9,750,000

12/31/2010

   $11,500,000

12/31/2011

   $11,500,000

12/31/2012

   $13,500,000

12/31/2013

   $13,500,000

12/31/2014

   $15,250,000

12/31/2015

   $15,250,000 or such lesser amount representing the remaining principal
balance of the Term Loan

 

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Section 1.5. Manner and Disbursement of Loans. The Company shall give written or
telephonic notice to the Lender (which notice shall be irrevocable once given)
by no later than 11:00 a.m. (Chicago time) on the date the Company requests that
any Loan be made to it under the Commitments. Each such notice shall specify the
date of the Loan requested (which must be a Business Day), the type of Loan
being requested, and the amount thereof. Each Loan shall initially constitute
part of the applicable Base Rate Portion except to the extent the Company has
otherwise timely elected that such Loan, or any part thereof, constitute part of
a LIBOR Portion as provided in Section 2 hereof. The Company agrees that the
Lender may rely upon any written or telephonic notice given by any person the
Lender in good faith believes is an Authorized Representative without the
necessity of independent investigation and, in the event any telephonic notice
conflicts with any written confirmation, such telephonic notice shall govern if
the Lender has acted in reliance thereon. Subject to the provisions of Section 6
hereof, the proceeds of each Loan shall be made available to the Company at the
principal office of the Lender in Chicago, Illinois, in immediately available
funds.

SECTION 2. INTEREST AND CHANGE IN CIRCUMSTANCES.

Section 2.1. Interest Rate Options.

(a) Portions. Subject to the terms and conditions of this Section 2, portions of
the principal indebtedness evidenced by the Notes (all of the indebtedness
evidenced by Notes of the same type bearing interest at the same rate for the
same period of time being hereinafter referred to as a “Portion”) shall bear
interest with reference to the Base Rate (“Base Rate Portions”) or, at the
option of the Company and subject to the terms and conditions hereof, with
reference to the Adjusted LIBOR (“LIBOR Portions”). Subject to the terms and
conditions of this Section 2, the Base Rate Portion or LIBOR Portions of Notes
of the same type may be converted from time to time from one basis to the other.
All of the indebtedness evidenced by a Note which is not part of a LIBOR Portion
shall constitute a single Base Rate Portion applicable to such Note. All of the
indebtedness evidenced by a Note which bears interest with reference to a
particular Adjusted LIBOR for a particular Interest Period shall constitute a
single LIBOR Portion applicable to such Note. There shall not be more than five
LIBOR Portions applicable to the Revolving Credit Note outstanding at any one
time. There shall be not more than seven LIBOR Portions applicable to the Term
Note outstanding at any one time. Anything contained herein to the contrary
notwithstanding, the obligation of the Lender to create, continue or effect by
conversion any LIBOR Portion shall be conditioned upon the fact that at the time
no Default or Event of Default shall have occurred and be continuing. The
Company hereby promises to pay interest on each Portion at the rates and times
specified in this Section 2.

(b) Base Rate Portion. Each Base Rate Portion shall bear interest at the rate
per annum determined equal to the Base Rate as in effect from time to time plus
the Applicable Base Rate Margin, provided that if a Base Rate Portion or any
part thereof is not paid when due (whether by lapse of time, acceleration or
otherwise), or at the election of the Lender upon notice to the Company after
the occurrence and during the continuation of any other Event of Default, such
Portion shall bear interest, whether before or after judgment, until payment in
full of the amount then due at the rate per annum determined by adding 2.0% to
the interest rate which would otherwise be applicable thereto from time to time.
Interest on each Base Rate Portion shall be

 

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payable quarterly in arrears on the last day of each March, June, September and
December in each year and at maturity of the applicable Note, and interest after
maturity (whether by lapse of time, acceleration or otherwise) shall be due and
payable upon demand. Any change in the interest rate on the Base Rate Portions
resulting from a change in the Base Rate shall be effective on the date of the
relevant change in the Base Rate.

(c) LIBOR Portions. Each LIBOR Portion shall bear interest for each Interest
Period selected therefor at a rate per annum determined by adding the Applicable
LIBOR Margin to the Adjusted LIBOR for such Interest Period, provided that if
any LIBOR Portion is not paid when due (whether by lapse of time, acceleration
or otherwise), or at the election of the Lender upon notice to the Company after
the occurrence and during the continuation of any other Event of Default, such
Portion shall bear interest, whether before or after judgment, until payment in
full of the amount then due through the end of the Interest Period then
applicable thereto at the rate per annum determined by adding 2.0% to the
interest rate which would otherwise be applicable thereto, and effective at the
end of such Interest Period such LIBOR Portion shall automatically be converted
into and added to the applicable Base Rate Portion and shall thereafter bear
interest at the interest rate applicable to such Base Rate Portion. Interest on
each LIBOR Portion shall be due and payable on the last day of each Interest
Period applicable thereto, and, with respect to any LIBOR Portion with an
Interest Period in excess of three months, on the last day of every three-month
period following the first day of such Interest Period and on the last day of
such Interest Period, and interest after maturity (whether by lapse of time,
acceleration or otherwise) shall be due and payable upon demand. The Company
shall notify the Lender on or before 11:00 a.m. (Chicago time) on the third
Business Day preceding the end of an Interest Period applicable to a LIBOR
Portion whether such LIBOR Portion is to continue as a LIBOR Portion, in which
event the Company shall notify the Lender of the new Interest Period selected
therefor, and in the event the Company shall fail to so notify the Lender, such
LIBOR Portion shall automatically be converted into and added to the applicable
Base Rate Portion as of and on the last day of such Interest Period.

Section 2.2. Minimum LIBOR Portions. Each LIBOR Portion applicable to the
Revolving Credit Note shall be in an amount equal to $1,000,000 or such greater
amount which is an integral multiple of $1,000,000, and each LIBOR Portion
applicable to the Term Note shall be in an amount equal to $5,000,000 or such
greater amount which is an integral multiple of $1,000,000.

Section 2.3. Computation of Interest. All interest on the Notes shall be
computed on the basis of a year of 360 days for the actual number of days
elapsed.

Section 2.4. Manner of Rate Selection. The Company shall notify the Lender by
11:00 a.m. (Chicago time) at least three Business Days prior to the date upon
which the Company requests that any LIBOR Portion be created or that any part of
the applicable Base Rate Portion be converted into a LIBOR Portion (each such
notice to specify in each instance the amount thereof and the Interest Period
selected therefor). If any request is made to convert a LIBOR Portion into the
relevant Base Rate Portion hereunder, such conversion shall only be made so as
to become effective as of the last day of the Interest Period applicable
thereto. All requests for the creation, continuance and conversion of LIBOR
Portions under this Agreement shall be

 

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irrevocable. Such requests may be written or oral and the Lender is hereby
authorized to honor telephonic requests for creations, continuances and
conversions received by it from any person the Lender in good faith believes to
be an Authorized Representative without the necessity of independent
investigation, the Company hereby indemnifying the Lender from any liability or
loss ensuing from so acting.

Section 2.5. Change of Law. Notwithstanding any other provisions of this
Agreement or any Note, if at any time the Lender shall determine that any change
in applicable laws, treaties or regulations or in the interpretation thereof
makes it unlawful for the Lender to create or continue to maintain any LIBOR
Portion, it shall promptly so notify the Company and the obligation of the
Lender to create, continue or maintain any such LIBOR Portion under this
Agreement shall be suspended until it is no longer unlawful for the Lender to
create, continue or maintain such LIBOR Portion. The Company, on demand, shall,
if the continued maintenance of any such LIBOR Portion is unlawful, thereupon
prepay the outstanding principal amount of the affected LIBOR Portion, together
with all interest accrued thereon and all other amounts payable to the Lender
with respect thereto under this Agreement; provided, however, that the Company
may elect to convert the principal amount of the affected LIBOR Portion into the
relevant Base Rate Portion hereunder, subject to the terms and conditions of
this Agreement.

Section 2.6. Unavailability of Deposits or Inability to Ascertain Adjusted
LIBOR. Notwithstanding any other provision of this Agreement or any Note, if
prior to the commencement of any Interest Period, the Lender shall determine
that deposits in the amount of any LIBOR Portion scheduled to be outstanding
during such Interest Period are not readily available to the Lender in the
relevant market or, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining Adjusted LIBOR, then
the Lender shall promptly give notice thereof to the Company and the obligation
of the Lender to create, continue or effect by conversion any such LIBOR Portion
in such amount and for such Interest Period shall be suspended until deposits in
such amount and for the Interest Period selected by the Company shall again be
readily available in the relevant market and adequate and reasonable means exist
for ascertaining Adjusted LIBOR.

Section 2.7. Taxes and Increased Costs. With respect to any LIBOR Portion, if
the Lender shall determine that any change in any applicable law, treaty,
regulation or guideline (including, without limitation, Regulation D of the
Board of Governors of the Federal Reserve System) or any new law, treaty,
regulation or guideline, or any interpretation of any of the foregoing by any
governmental authority charged with the administration thereof or any central
bank or other fiscal, monetary or other authority having jurisdiction over the
Lender or its lending branch or the LIBOR Portions contemplated by this
Agreement (whether or not having the force of law), shall:

(i) impose, increase, or deem applicable any reserve, special deposit or similar
requirement against assets held by, or deposits in or for the account of, or
loans by, or any other acquisition of funds or disbursements by, the Lender
which is not in any instance already accounted for in computing the interest
rate applicable to such LIBOR Portion;

 

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(ii) subject the Lender, any LIBOR Portion or a Note to the extent it evidences
any LIBOR Portion to any tax (including, without limitation, any United States
interest equalization tax or similar tax however named applicable to the
acquisition or holding of debt obligations and any interest or penalties with
respect thereto), duty, charge, stamp tax, fee, deduction or withholding in
respect of this Agreement, any LIBOR Portion or a Note to the extent it
evidences any LIBOR Portion, except such taxes as may be measured by the overall
net income or gross receipts of the Lender or its lending branches and imposed
by the jurisdiction, or any political subdivision or taxing authority thereof,
in which the Lender’s principal executive office or its lending branch is
located;

(iii) change the basis of taxation of payments of principal and interest due
from the Company to the Lender hereunder or under a Note to the extent it
evidences any LIBOR Portion (other than by a change in taxation of the overall
net income or gross receipts of the Lender or its lending branches); or

(iv) impose on the Lender any penalty with respect to the foregoing or any other
condition regarding this Agreement, any LIBOR Portion, or a Note to the extent
it evidences any LIBOR Portion;

and the Lender shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to the
Lender of creating or maintaining any LIBOR Portion hereunder or to reduce the
amount of principal or interest received or receivable by the Lender (without
benefit of, or credit for, any prorations, exemption, credits or other offsets
available under any such laws, treaties, regulations, guidelines or
interpretations thereof), then the Company shall pay on demand to the Lender
from time to time as specified by the Lender the additional amounts as the
Lender shall reasonably determine are sufficient to compensate and indemnify it
for such increased cost or reduced amount. If the Lender makes such a claim for
compensation, it shall provide to the Company a certificate setting forth the
computation of the increased cost or reduced amount as a result of any event
mentioned herein in reasonable detail and such certificate shall be conclusive
if reasonably determined (absent manifest error).

Section 2.8. Funding Indemnity. In the event the Lender shall incur any loss,
cost or expense (including, without limitation, any loss (including loss of
profit), cost or expense incurred by reason of the liquidation or re-employment
of deposits or other funds acquired or contracted to be acquired by the Lender
to fund or maintain its part of any LIBOR Portion or the relending or
reinvesting of such deposits or other funds or amounts paid or prepaid to the
Lender) as a result of:

(i) any payment of a LIBOR Portion on a date other than the last day of the then
applicable Interest Period for any reason, whether before or after default, and
whether or not such payment is required by any provisions of this Agreement; or

(ii) any failure by the Company to create, borrow, continue or effect by
conversion a LIBOR Portion on the date specified in a notice given pursuant to
this Agreement;

 

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then, upon the demand of the Lender, the Company shall pay to the Lender such
amount as will reimburse the Lender for such loss, cost or expense. If the
Lender requests such reimbursement under this Section, it shall provide to the
Company a certificate setting forth the computation of the loss, cost, or
expense giving rise to the request for reimbursement in reasonable detail and
such certificate shall be conclusive if reasonably determined (absent manifest
error).

Section 2.9. Lending Branch. The Lender may, at its option, elect to make, fund
or maintain the Loans hereunder at the branches or offices specified on the
signature pages hereof or at such of its branches or offices as the Lender may
from time to time elect.

Section 2.10. Discretion of Lender as to Manner of Funding. Notwithstanding any
provision of this Agreement to the contrary, the Lender shall be entitled to
fund and maintain its funding of all or any part of the Notes in any manner it
sees fit (provided the same is in accordance with this Agreement), it being
understood, however, that for purposes of this Agreement all determinations
hereunder with respect to LIBOR Portions (including, without limitation,
determinations under Sections 2.6, 2.7 and 2.8 hereof) shall be made as if the
Lender had actually funded and maintained each LIBOR Portion during each
Interest Period applicable thereto through the purchase of deposits in the
relevant market in the amount of such LIBOR Portion, having a maturity
corresponding to such Interest Period, and bearing an interest rate equal to the
LIBOR for such Interest Period.

SECTION 3. FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.

Section 3.1. Fees. (a) Revolving Credit Facility Fee. For the period from and
including the date hereof, to but not including the Revolving Credit Termination
Date, the Company shall pay to the Lender a facility fee at the rate of .10% per
annum (computed on the basis of a year of 360 days for the actual number of days
elapsed) on the average daily Revolving Credit Commitment in effect during such
time (whether or not in use). Such facility fee shall be payable quarterly in
arrears on the last day of each March, June, September, and December in each
year (commencing on the first such date occurring after the date hereof) and on
the Revolving Credit Termination Date unless the Revolving Credit Commitment is
terminated in whole on an earlier date, in which event the facility fee for the
period to the date of such termination in whole shall be paid on the date of
such termination.

(b) Letter of Credit Fees. On the date of issuance of each Letter of Credit, and
as condition thereto, and annually thereafter, the Company shall pay to the
Lender a letter of credit fee computed at the rate of 1.0% per annum (computed
on the basis of a year of 360 days for the actual number of days elapsed) on the
maximum amount of the related Letter of Credit which is scheduled to be
outstanding during the immediately succeeding twelve (12) months. In addition to
the letter of credit fee called for above, the Company further agrees to pay to
the Lender such issuing, processing, and transaction fees and charges as the
Lender from time to time customarily imposes in connection with any issuance,
amendment, cancellation, negotiation and/or payment of letters of credit and
drawings made thereunder.

(c) Arrangement Fee. On the date hereof, the Company shall pay to the Lender an
arrangement fee as mutually agreed upon by the Company and the Lender.

 

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Section 3.2. Voluntary Prepayments. The Company shall have the privilege of
prepaying the Revolving Credit Loans and the Term Loan in whole or in part (but
if in part, then (i) if such Loans constitute part of a Base Rate Portion, in an
amount not less than $100,000, (ii) if such Loan constitutes part of a LIBOR
Portion, in an amount not less than $1,000,000, and (iii) in each case, in an
amount such that the minimum amount required for a borrowing of Revolving Credit
Loans or for a LIBOR Portion of the relevant Loans pursuant to Sections 1.2 and
2.2 hereof remains outstanding) at any time upon 1 Business Day prior notice to
the Lender (such notice if received subsequent to 2:00 p.m. (Chicago time) on a
given day to be treated as though received at the opening of business on the
next Business Day), by paying to the Lender the principal amount to be prepaid
and (i) if such a prepayment prepays the Term Note in whole or in part, accrued
interest thereon to the date of prepayment, (ii) if such a prepayment prepays
the Revolving Credit Note in full and is accompanied by the termination in whole
of the Revolving Credit Commitment, accrued interest and facility fees thereon
to the date of prepayment, and (iii) any amounts due to the Lender under
Section 2.8 hereof.

Section 3.3. Mandatory Termination. After the occurrence of a Change of Control,
the Lender may, by written notice to the Company at any time on or before the
date occurring 120 days after the date the Company notifies the Lender of such
Change of Control, terminate the remaining Commitments and all other obligations
of the Lender hereunder on the date stated in such notice (which shall in no
event be sooner than 120 days after the occurrence of such Change of Control).
On the date the Commitments are so terminated, all outstanding Obligations
(including, without limitation, all principal of and accrued interest on the
Notes) shall forthwith be due and payable without further demand, presentment,
protest, or notice of any kind and the Company shall immediately pay to the
Lender the full amount then available for drawing under each Letter of Credit,
such amount to be held in the Account referred to in Section 8.4 hereof (the
Company agreeing to immediately make such payment on the date the Commitments
are so terminated and acknowledging and agreeing that the Lender would not have
an adequate remedy at law for the failure by the Company to honor any such
demand and that the Lender shall have the right to require the Company to
specifically perform such undertaking whether or not any drawings or other
demands for payment have been made under any Letter of Credit).

Section 3.4. Voluntary Terminations. The Company shall have the right at any
time and from time to time, upon 1 Business Day prior notice to the Lender, to
terminate without premium or penalty and in whole or in part (but if in part,
then in an aggregate amount not less than $1,000,000 or such greater amount
which is an integral multiple of $1,000,000) the Revolving Credit Commitment,
provided that the Revolving Credit Commitment may not be reduced to an amount
less than the aggregate principal amount of the Revolving Credit Loans and
Letters of Credit then outstanding. Any termination of the Revolving Credit
Commitment pursuant to this Section may not be reinstated.

Section 3.5. Place and Application of Payments. All payments of principal,
interest, fees and all other Obligations payable hereunder and under the other
Loan Documents shall be made to the Lender at its office at 111 West Monroe
Street, Chicago, Illinois (or at such other place as the Lender may specify), on
the date any such payment is due and payable. Payments received by the Lender
after 2:00 p.m. (Chicago time) shall be deemed received as of the opening of
business on the next Business Day. All such payments shall be made in lawful

 

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money of the United States of America, in immediately available funds at the
place of payment, without set-off or counterclaim and without reduction for, and
free from, any and all present or future taxes, levies, imposts, duties, fees,
charges, deductions, withholdings, restrictions and conditions of any nature
imposed by any government or any political subdivision or taxing authority
thereof (but excluding any taxes imposed on or measured by the net income of the
Lender). No amount paid or prepaid on the Term Note may be reborrowed, and
partial prepayments of the Term Note shall be applied in the order of their
scheduled maturities. Unless the Company otherwise directs, principal payments
of a Note shall be first applied to the Base Rate Portion until payment in full
thereof, with any balance applied to the relevant LIBOR Portions in the order in
which their Interest Periods expire.

Section 3.6. Notations. Each Loan made against a Note, the status of all amounts
evidenced by a Note as constituting part of the Base Rate Portion or a LIBOR
Portion, and, in the case of any LIBOR Portion, the rates of interest and
Interest Periods applicable to such Portions shall be recorded by the Lender on
its books and records or, at its option in any instance, endorsed on a schedule
to its Note and the unpaid principal balance and status, rates and Interest
Periods so recorded or endorsed by the Lender shall, absent manifest error, be
prima facie evidence in any court or other proceeding brought to enforce such
Note of the principal amount remaining unpaid thereon, the status of the Loan or
Loans evidenced thereby and the interest rates and Interest Periods applicable
thereto; provided that the failure of the Lender to record any of the foregoing
shall not limit or otherwise affect the obligation of the Company to repay the
principal amount of each Note together with accrued interest thereon. Prior to
any negotiation of a Note, the Lender shall record on a schedule thereto the
status of all amounts evidenced thereby as constituting part of the applicable
Base Rate Portion or a LIBOR Portion and, in the case of any LIBOR Portion, the
rates of interest and the Interest Periods applicable thereto.

SECTION 4. DEFINITIONS; INTERPRETATION.

Section 4.1. Definitions. The following terms when used herein shall have the
following meanings:

“Adjusted LIBOR” means a rate per annum determined by the Lender in accordance
with the following formula:

 

Adjusted LIBOR

          =                                LIBOR                          
100%-Reserve Percentage

“Reserve Percentage” means, for the purpose of computing Adjusted LIBOR, the
maximum rate of all reserve requirements (including, without limitation, any
marginal, emergency, supplemental or other special reserves) imposed by the
Board of Governors of the Federal Reserve System (or any successor) under
Regulation D on Eurocurrency liabilities (as such term is defined in
Regulation D) for the applicable Interest Period as of the first day of such
Interest Period, but subject to any amendments to such reserve requirement by
such Board or its successor, and taking into account any transitional
adjustments thereto becoming effective during such Interest Period. For purposes
of this definition, LIBOR Portions shall be deemed to be

 

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Eurocurrency liabilities as defined in Regulation D without benefit of or credit
for prorations, exemptions or offsets under Regulation D. “LIBOR” means, for
each Interest Period, (a) the LIBOR Index Rate for such Interest Period, if such
rate is available, and (b) if the LIBOR Index Rate cannot be determined, the
arithmetic average of the rates of interest per annum (rounded upward, if
necessary, to the nearest 1/100th of 1%) at which deposits in U.S. Dollars in
immediately available funds are offered to the Lender at 11:00 a.m. (London,
England time) 2 Business Days before the beginning of such Interest Period by 3
or more major banks in the interbank eurodollar market selected by the Lender
for a period equal to such Interest Period and in an amount equal or comparable
to the applicable LIBOR Portion scheduled to be outstanding during such Interest
Period. “LIBOR Index Rate” means, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a period equal to such
Interest Period which appears on the Telerate Page 3750 as of 11:00 a.m.
(London, England time) on the date 2 Business Days before the commencement of
such Interest Period. “Telerate Page 3750” means the display designated as
“Page 3750” on the Telerate Service (or such other page as may replace Page 3750
on that service or such other service as may be nominated by the British
Bankers’ Association as the information vendor for the purpose of displaying
British Banker’s Association Interest Settlement Rates for U.S. Dollar
deposits). Each determination of LIBOR made by the Lender shall be conclusive
and binding on the Company absent manifest error.

“Adjusted Net Income” means, with reference to any period, Net Income, before
extraordinary items (including, without limitation, for purposes of this
definition charges relating to SAIF recapitalization and the recapture of tax
bad debt reserves), of the Company and its Subsidiaries for such period computed
on a consolidated basis.

“Adjusted Net Worth” means, at any time the same is to be determined, Net Worth
of the Company and its Subsidiaries determined on a consolidated basis minus the
sum of (i) investments in, and loans and advances to, MAF Developments and
(ii) goodwill associated with, and all other intangible assets of, Mid America,
and determined without giving effect to mark-to-market adjustments required by
FASB 115 (Accounting for Certain Investments in Debt and Equity Securities).

“Affiliate” means any Person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, another Person. A Person
shall be deemed to control another Person for the purposes of this definition if
such Person possesses, directly or indirectly, the power to direct, or cause the
direction of, the management and policies of the other Person, whether through
the ownership of voting securities, common directors, trustees or officers, by
contract or otherwise.

“Agreement” means this Credit Agreement, as the same may be amended, modified or
restated from time to time in accordance with the terms hereof.

“Applicable Base Rate Margin” means, with respect to the Revolving Credit Loans
and the Term Loans, - 0.50%.

 

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“Applicable LIBOR Margin” means (i) with respect to the Revolving Credit Loans,
0.80% and (ii) with respect to the Term Loans, 0.90%.

“Application” is defined in Section 1.3(d) hereof.

“Authorized Representative” means those persons shown on the list of officers
provided by the Company pursuant to Section 6.2(a) hereof or on any update of
any such list provided by the Company to the Lender, or any further or different
officer of the Company so named by any Authorized Representative of the Company
in a written notice to the Lender.

“Banking Subsidiary” means any Subsidiary of the Company which is a bank or
thrift organized under the laws of the United States of America or any state
thereof.

“Base Rate” means, for any day, the rate of interest announced by the Lender
from time to time as its prime commercial rate, as in effect on such day (it
being understood and agreed that such rate may not be the Lender’s best or
lowest rate).

“Base Rate Portions” is defined in Section 2.1(a) hereof.

“Business Day” means any day other than a Saturday or Sunday on which banks are
not authorized or required to close in Chicago, Illinois and, when used with
respect to LIBOR Portions, a day on which banks are also dealing in United
States Dollar deposits in London, England and Nassau, Bahamas.

“Capital Lease” means any lease of Property which in accordance with GAAP is
required to be capitalized on the balance sheet of the lessee.

“Capitalized Lease Obligation” means the amount of the liability shown on the
balance sheet of any Person in respect of a Capital Lease determined in
accordance with GAAP.

“Change of Control” means, during the 12-month period occurring after the date
of this Agreement and each 12-month period occurring thereafter, individuals who
at the beginning of such period were directors of the Company shall cease for
any reason to constitute a majority of the board of directors of the Company.

“Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute thereto.

“Commitments” means and includes the Revolving Credit Commitment and the Term
Loan Commitment.

“Company” is defined in the introductory paragraph hereof.

“Contingent Obligation” of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or

 

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liability of any other Person, or agrees to maintain the net worth or working
capital or other financial condition of any other Person, or otherwise assures
any creditor of such other Person against loss, including, without limitation,
any comfort letter, operating agreement, take-or-pay contract or application for
a letter of credit.

“Controlled Group” means all members of a controlled group of corporations and
all trades or businesses (whether or not incorporated) under common control
which, together with the Company or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.

“Default” means any event or condition the occurrence of which would, with the
passage of time or the giving of notice, or both, constitute an Event of
Default.

“EFC” means EFC Bancorp. Inc., a Delaware corporation.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute thereto.

“Event of Default” means any event or condition identified as such in
Section 8.1 hereof.

“GAAP” means generally accepted accounting principles as in effect from time to
time, applied by the Company and its Subsidiaries on a basis consistent with the
preparation of the Company’s most recent financial statements furnished to the
Lender pursuant to Section 5.5 hereof.

“Indebtedness for Borrowed Money” means for any Person (without duplication)
(i) all indebtedness created, assumed or incurred in any manner by such Person
representing money borrowed (including by the issuance of debt securities),
(ii) all indebtedness for the deferred purchase price of property or services,
(iii) all indebtedness secured by any Lien upon Property of such Person, whether
or not such Person has assumed or become liable for the payment of such
indebtedness, (iv) all Capitalized Lease Obligations of such Person, (v) all
Contingent Obligations of such Person, (vi) all obligations of such Person on or
with respect to letters of credit, bankers’ acceptances and other extensions of
credit whether or not representing obligations for borrowed money, and
(vii) Permitted Banking Subsidiary Indebtedness of such Person; provided
however, the above shall not include (a) trade accounts payable arising in the
ordinary course of business, or (b) accrued compensation for officers and
directors of such Person.

“Interest Period” means, with respect to any LIBOR Portion, the period
commencing on, as the case may be, the creation, continuation or conversion date
with respect to such LIBOR Portion and ending 1, 2, 3, 6 or 12 months thereafter
as selected by the Company in its notice as provided herein; provided that, all
of the foregoing provisions relating to Interest Periods are subject to the
following:

(i) if any Interest Period would otherwise end on a day which is not a Business
Day, that Interest Period shall be extended to the next succeeding Business Day,

 

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unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Business Day;

(ii) no Interest Period may extend beyond the final maturity date of the
relevant Note;

(iii) the interest rate to be applicable to each Portion for each Interest
Period shall apply from and including the first day of such Interest Period to
but excluding the last day thereof; and

(iv) no Interest Period may be selected if after giving effect thereto the
Company will be unable to make a principal payment scheduled to be made during
such Interest Period without paying part of a LIBOR Portion on a date other than
the last day of the Interest Period applicable thereto.

For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the month
in which an Interest Period is to end, then such Interest Period shall end on
the last Business Day of such month.

“Lender” is defined in the introductory paragraph hereof.

“Letter of Credit” is defined in Section 1.3(a) hereof.

“LIBOR Portions” is defined in Section 2.1(a) hereof.

“Lien” means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.

“Loan Documents” means this Agreement, the Notes, the Applications, and each
other instrument or document to be delivered hereunder or thereunder or
otherwise in connection therewith.

“Loans” means and includes Revolving Credit Loans and the Term Loan.

“MAF Developments” means MAF Developments, Inc., an Illinois corporation, and
its successors and assigns.

“Merger” means the merger of EFC with and into the Company with the Company
surviving the Merger.

“Merger Documents” means the Agreement and Plan of Reorganization, dated as of
June 29, 2005, between the Company and EFC, and all other instruments and
documents

 

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executed and delivered in connection therewith and the consummation of the
Merger described therein.

“Mid America” means Mid America Bank, fsb.

“Net Income” means, with reference to a Person for any period, the net income
(or net loss) of such Person for such period, computed in accordance with GAAP.

“Net Worth” means, with reference to any Person at any time the same is to be
determined, the total shareholders’ equity (including capital stock, additional
paid-in capital, accumulated other comprehensive income, and retained earnings
after deducting treasury stock, but excluding any minority interests in
subsidiaries) which would appear on the balance sheet of such Person determined
in accordance with GAAP or, when such term is used with respect to the Tangible
Capital Ratio of a Banking Subsidiary, regulatory accounting principles of the
applicable bank or thrift regulatory authority.

“Non-Performing Assets” means, with reference to any Person, as of any time the
same is to be determined, the sum of all non-performing assets of such Person as
determined in accordance with regulatory accounting principles applicable to
such Person, but in any event including, without limitation, (i) loans or other
extensions of credit on which any payment (whether principal or interest or
otherwise) is not made within 90 days of its original due date, (ii) loans which
have been placed on a non-accrual basis, (iii) loans restructured so as to not
bear interest at a then market rate or so that other terms thereof have been
compromised, and (iv) property acquired by repossession or foreclosure and,
without duplication, property acquired pursuant to in-substance foreclosure.

“Notes” means and includes the Revolving Credit Note and the Term Note.

“Obligations” means all obligations of the Company to pay principal and interest
on the Loans, all reimbursement obligations owing under the Applications, all
fees and charges payable hereunder, and all other payment obligations of the
Company arising under or in relation to any Loan Document, in each case whether
now existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired.

“PBGC” means the Pension Benefit Guaranty Corporation or any Person succeeding
to any or all of its functions under ERISA.

“Permitted Banking Subsidiary Indebtedness” means obligations incurred by any
Banking Subsidiary in the ordinary course of business in such circumstances as
may be incidental or usual in carrying on the banking or trust business of a
bank, thrift or trust company incurred in accordance with applicable laws and
regulations and safe and sound banking practices.

“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or agency or political subdivision thereof.

 

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“Plan” means any employee pension benefit plan covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code that
either (i) is maintained by a member of the Controlled Group for employees of a
member of the Controlled Group, or (ii) is maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one employer
makes contributions and to which a member of the Controlled Group is then making
or accruing an obligation to make contributions or has within the preceding five
plan years made contributions.

“Portion” is defined in Section 2.1(a) hereof.

“Property” means any interest in any kind of property or asset, whether real,
personal or mixed, or tangible or intangible.

“Revolving Credit” is defined in Section 1.1 hereof.

“Revolving Credit Commitment” means $60,000,000, as such amount may be reduced
pursuant hereto.

“Revolving Credit Loan” is defined in Section 1.2 hereof.

“Revolving Credit Note” is defined in Section 1.2 hereof.

“Revolving Credit Termination Date” means January 30, 2007, or such earlier date
on which the Revolving Credit Commitment is terminated in whole pursuant to
Section 3.3, 3.4, 8.2, or 8.3 hereof.

“Subordinated Debt” means indebtedness for borrowed money of the Company owing
to any other Person or group of Persons on such other terms and conditions which
are reasonably acceptable to the Lender, which is subordinated (subject to
applicable standstill provisions) in right of payment to the prior payment in
full of the Obligations.

“Subsidiary” means any corporation or other Person more than 50% of the
outstanding ordinary voting shares or other equity interests of which is at the
time directly or indirectly owned by the Company, by one or more of its
Subsidiaries, or by the Company and one or more of its Subsidiaries.

“Tangible Capital” means, at any time the same is to be determined, for any
Banking Subsidiary, Net Worth of such Banking Subsidiary minus intangible assets
of such Banking Subsidiary (excluding, however, from the determination of
intangible assets investments of such Banking Subsidiary in any of its real
estate subsidiaries to the extent characterized as an intangible asset).

“Tangible Capital Ratio” means, at any time the same is to be determined, for
any Banking Subsidiary, the ratio of (i) Tangible Capital of such Banking
Subsidiary to (ii) total assets minus intangible assets of such Banking
Subsidiary, all as defined and determined, except

 

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as otherwise provided herein, from time to time by applicable bank or thrift
regulatory authorities.

“Term Loan” is defined in Section 1.4 hereof.

“Term Loan Commitment” means the commitment to make the Term Loan referred to in
Section 1.4 hereof.

“Term Note” is defined in Section 1.4 hereof.

“Unfunded Vested Liabilities” means, for any Plan at any time, the amount (if
any) by which the present value of all vested nonforfeitable accrued benefits
under such Plan exceeds the fair market value of all Plan assets allocable to
such benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of a member of the Controlled Group to the PBGC or the Plan under Title IV of
ERISA.

“Welfare Plan” means a “welfare plan” as defined in Section 3(1) of ERISA.

“Wholly-Owned Subsidiary” means a Subsidiary of which all of the issued and
outstanding shares of capital stock (other than directors’ qualifying shares as
required by law) or other equity interests are owned by the Company and/or one
or more Wholly-Owned Subsidiaries within the meaning of this definition.

Section 4.2. Interpretation. The foregoing definitions are equally applicable to
both the singular and plural forms of the terms defined. The words “hereof”,
“herein”, and “hereunder” and words of like import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement. All references to time of day herein are references to Chicago,
Illinois time unless otherwise specifically provided. Where the character or
amount of any asset or liability or item of income or expense is required to be
determined or any consolidation or other accounting computation is required to
be made for the purposes of this Agreement, it shall be done in accordance with
GAAP except where such principles are inconsistent with the specific provisions
of this Agreement.

SECTION 5. REPRESENTATIONS AND WARRANTIES.

At the time the Company requests the initial extension of credit under this
Agreement and at all times thereafter in accordance with Section 6.1 hereof, the
Company represents and warrants to the Lender as follows:

Section 5.1. Organization and Qualification. The Company is duly organized,
validly existing and in good standing as a corporation under the laws of the
State of Delaware, has full and adequate corporate power to own its Property and
conduct its business as now conducted, and is duly licensed or qualified and in
good standing in each jurisdiction in which the nature of the business conducted
by it or the nature of the Property owned or leased by it requires such
licensing or qualifying, except where the failure to so qualify will not have a
material adverse effect on the financial condition, Properties, business or
operations of the Company. Without

 

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limiting the generality of the foregoing, the Company is a savings and loan
holding company and, as such, the Company has received all necessary approvals
from, and has filed all necessary reports with, all applicable federal and state
regulatory authorities, except where the failure to do so will not have a
material adverse effect on the financial condition, Properties, business, or
operations of the Company.

Section 5.2. Subsidiaries. Each Subsidiary is duly organized, validly existing
and in good standing under the laws of the jurisdiction in which it is
incorporated or organized, as the case may be, has full and adequate power to
own its Property and conduct its business as now conducted, and is duly licensed
or qualified and in good standing in each jurisdiction in which the nature of
the business conducted by it or the nature of the Property owned or leased by it
requires such licensing or qualifying, except where the failure to so qualify
will not have a material adverse effect on the financial condition, Properties,
business or operations of such Subsidiary. Schedule 5.2 hereto identifies each
“significant subsidiary” (as defined in Rule 1-02(w) of Regulation S-X of the
Securities Exchange Act of 1934, as amended), the jurisdiction of its
incorporation or organization, as the case may be, and the percentage of issued
and outstanding shares of each class of its capital stock or other equity
interests owned by the Company. The Company and the Subsidiaries own 100% of the
capital stock or other equity interest of each of its subsidiaries, except in
the case of the MAF Realty Co., LLC-IV, 11% of its preferred membership
interests is owned by employees, former employees and directors of Mid America.
All of the outstanding shares of capital stock and other equity interests of
each Subsidiary are validly issued and outstanding and fully paid and
nonassessable and all such shares and other equity interests represented by
being owned by the Company or a Subsidiary are or will be owned immediately
after giving effect to the Merger, beneficially and of record, by the Company or
such Subsidiary free and clear of all Liens. There are no outstanding
commitments or other obligations of any Subsidiary to issue, and no options,
warrants or other rights of any Person to acquire, any shares of any class of
capital stock or other equity interests of any Subsidiary.

Section 5.3. Corporate Authority and Validity of Obligations. The Company has
full right and authority to enter into this Agreement and the other Loan
Documents, to make the borrowings herein provided for, to issue its Notes in
evidence thereof, and to perform all of its obligations hereunder and under the
other Loan Documents. The Loan Documents delivered by the Company have been duly
authorized, executed and delivered by the Company and constitute valid and
binding obligations of the Company enforceable in accordance with their terms
except as enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance or similar laws affecting creditors’ rights generally and general
principles of equity (regardless of whether the application of such principles
is considered in a proceeding in equity or at law); and this Agreement and the
other Loan Documents do not, nor does the performance or observance by the
Company of any of the matters and things herein or therein provided for,
contravene or constitute a default under any provision of law or any judgment,
injunction, order or decree binding upon the Company or any provision of the
charter, articles of incorporation or by-laws of the Company or any material
covenant, indenture or agreement of or affecting the Company or any of its
Properties, or result in the creation or imposition of any Lien on any Property
of the Company.

 

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Section 5.4. Use of Proceeds; Margin Stock. The Company shall use the proceeds
of (i) the Revolving Credit Loans and Letters of Credit made available hereunder
to acquire land for development in the ordinary course of business, for general
working capital purposes and to finance a portion of the Merger and (ii) the
Additional Term Loan, to finance a portion of the Merger and to refinance
existing indebtedness owing by the Company to the Lender. No part of the
proceeds of any Revolving Credit Loan or Letter of Credit made hereunder will be
used to purchase or carry any margin stock (within the meaning of Regulation U
of the Board of Governors of the Federal Reserve System), or to extend credit to
others for the purpose of purchasing or carrying any such margin stock. No part
of the proceeds of the Term Loan will be used to purchase or carry any margin
stock (as defined above), or to extend credit to others for the purpose of
purchasing or carrying any such margin stock, in violation of such Regulation U.
After giving effect to the Merger, margin stock (as defined above) constitutes
less than 25% of those assets of the Company and its Subsidiaries which are
subject to any limitation on sale, pledge, or other restriction hereunder.

Section 5.5. Financial Reports. (a) The consolidated balance sheet of the
Company and its Subsidiaries as of December 31, 2004, and the related
consolidated statements of income, retained earnings and cash flows of the
Company and its Subsidiaries for the fiscal year then ended, and accompanying
notes thereto, which financial statements are accompanied by the audit report of
KPMG LLP, independent public accountants, and the unaudited interim consolidated
balance sheet of the Company and its Subsidiaries as of September 30, 2005, and
the related consolidated statements of income, retained earnings and cash flows
of the Company and its Subsidiaries for the 9 months then ended, heretofore
furnished to the Lender, fairly present the consolidated financial condition of
the Company and its Subsidiaries as at said dates and the consolidated results
of their operations and cash flows for the periods then ended in conformity with
GAAP, subject to year-end audit adjustments in the case of such interim
financial statements.

(b) To the best of the Company’s knowledge, the financial statements of EFC and
its subsidiaries referred to in the Proxy Statement of EFC and Prospectus of the
Company dated November 7, 2005, fairly present the consolidated financial
condition of EFC and its subsidiaries and the consolidated results of their
operations and cash flows as of the dates of such statements in conformity with
GAAP, subject to year-end audit adjustments in the case of interim financial
statements.

(c) Neither the Company nor any Subsidiary has contingent liabilities which are
material to the Company and its Subsidiaries on a consolidated basis other than
as indicated on the financial statements referred to in clause (a) above and, to
the best of the Company’s knowledge, neither EFC nor any of its subsidiaries has
contingent liabilities which are material to EFC and its subsidiaries on a
consolidated basis other than as indicated on the financial statements referred
to in clause (b) above or, in all cases, with respect to future periods, on the
financial statements furnished pursuant to Section 7.5 hereof.

Section 5.6. No Material Adverse Change. Since September 30, 2005, there has
been no material adverse change in the condition (financial or otherwise) of the
Company and its Subsidiaries taken as a whole and, to the best of the Company’s
knowledge, since September 30,

 

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2005, there has been no material adverse change in the condition (financial or
otherwise) of EFC and its subsidiaries taken as a whole.

Section 5.7. Full Disclosure. The statements and information furnished to the
Lender in connection with the negotiation of this Agreement and the other Loan
Documents and the commitments by the Lender to provide all or part of the
financing contemplated hereby do not contain any untrue statements of a material
fact or omit a material fact necessary to make the material statements contained
herein or therein not misleading, the Lender acknowledging that as to any
projections furnished to the Lender, the Company only represents that the same
were prepared on the basis of information and estimates the Company believed to
be reasonable.

Section 5.8. Good Title. The Company and its Subsidiaries each have good and
defensible title to their assets as reflected on the most recent consolidated
balance sheet of the Company and its Subsidiaries furnished to the Lender
(except for assets and Properties disposed of in the ordinary course of business
and assets subject to Liens which, individually and in the aggregate, do not
have a material adverse effect on the financial condition, Properties, business
or operations of the Company or any Subsidiary) and, in the case of assets
consisting of stock or other equity interests in Subsidiaries, subject to no
Liens.

Section 5.9. Litigation and Other Controversies. There is no litigation or
governmental proceeding or labor controversy pending, nor to the knowledge of
the Company threatened, against the Company or any Subsidiary which if adversely
determined would (a) impair the validity or enforceability of, or impair the
ability of the Company to perform its obligations under, this Agreement or any
other Loan Document or (b) result in any material adverse change in the
financial condition, Properties, business or operations of the Company or any
Subsidiary.

Section 5.10. Taxes. All tax returns required to be filed by the Company or any
Subsidiary in any jurisdiction have, in fact, been filed, and all taxes,
assessments, fees and other governmental charges upon the Company or any
Subsidiary or upon any of their respective Properties, income or franchises,
which are shown to be due and payable in such returns, have been paid, except
for taxes, assessments, fees and other governmental charges being contested in
good faith and for which adequate reserves therefor have been established on the
books of the Company or any Subsidiary, as applicable. The Company does not know
of any proposed additional tax assessment against it or its Subsidiaries under
applicable tax laws in effect at the time this representation is made or deemed
made for which adequate provision in accordance with GAAP has not been made on
its accounts. Adequate provisions in accordance with GAAP for taxes on the books
of the Company and each Subsidiary have been made for all open years, and for
its current fiscal period.

Section 5.11. Approvals. No authorization, consent, license, or exemption from,
or filing or registration with, any court or governmental department, agency or
instrumentality, nor any approval or consent of the stockholders of the Company
or any other Person, is or will be necessary to the valid execution, delivery or
performance by the Company of this Agreement or any other Loan Document, except
for such consents and approvals which have been or will be obtained prior to the
initial extension of credit made under this Agreement.

 

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Section 5.12. Affiliate Transactions. Neither the Company nor any Subsidiary is
a party to any contracts or agreements with any of its Affiliates on terms and
conditions which are less favorable to the Company or such Subsidiary than would
be usual and customary in similar contracts or agreements between Persons not
affiliated with each other.

Section 5.13. Investment Company; Public Utility Holding Company. Neither the
Company nor any Subsidiary is an “investment company” or a company “controlled”
by an “investment company” within the meaning of the Investment Company Act of
1940, as amended, or a “public utility holding company” within the meaning of
the Public Utility Holding Company Act of 1935, as amended.

Section 5.14. ERISA. To the best of the Company’s knowledge, the Company and
each other member of its Controlled Group has fulfilled its obligations under
the minimum funding standards of and is in compliance in all material respects
with ERISA and the Code to the extent applicable to it and has not incurred any
liability to the PBGC or a Plan under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA. Neither the Company nor
any Subsidiary has any material contingent liabilities with respect to any
post-retirement benefits under a Welfare Plan, other than liability for
continuation coverage described in article 6 of Title I of ERISA.

Section 5.15. Compliance with Laws. To the best of the Company’s knowledge, the
Company and each of its Subsidiaries are in compliance with the requirements of
all federal, state and local laws, rules and regulations applicable to or
pertaining to their Properties or business operations, non-compliance with which
could reasonably be expected to have a material adverse effect on the financial
condition, Properties, business or operations of the Company or any Subsidiary.
Neither the Company (or any of its directors or officers) nor any Banking
Subsidiary (or any of its directors or officers) is a party to, or subject to,
any agreement with, or directive or order issued by, any federal or state bank
or thrift regulatory authority which imposes restrictions or requirements on it
which are not generally applicable to banks or thrifts, or their holding
companies; and no action or administrative proceeding is pending or, to the
Company’s knowledge, threatened against the Company or any Banking Subsidiary or
any of their directors or officers which seeks to impose any such restriction or
requirement. Neither the Company nor any Subsidiary has received written notice
to the effect that its operations are not in compliance with any of the
requirements of applicable federal, state or local environmental, health and
safety statutes and regulations or are the subject of any governmental
investigation evaluating whether any remedial action is needed to respond to a
release of any toxic or hazardous waste or substance into the environment, which
non-compliance or remedial action could reasonably be expected to have a
material adverse effect on the financial condition, Properties, business or
operations of the Company or any Subsidiary.

Section 5.16. Other Agreements. Neither the Company nor any Subsidiary is in
default under the terms of any covenant, indenture or agreement of or affecting
the Company, any Subsidiary or any of their Properties, which default if uncured
could reasonably be expected to have a material adverse effect on the financial
condition, Properties, business or operations of the Company or any Subsidiary.

 

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Section 5.17. Merger. The Company has full right and authority to enter into the
Merger Documents executed by it and, prior to the Company’s request for the
initial extension of credit to be made under this Agreement and at all times
thereafter, to perform its obligations under, and consummate the transactions
described in, the Merger Documents executed by it. The Merger Documents have
been duly authorized, executed, and delivered by the Company and constitute
valid and binding obligations of the Company enforceable against it in
accordance with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency, fraudulent conveyance, or similar laws affecting
creditors’ rights generally and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law); and the Merger Documents do not, nor will the performance or
observance by the Company of any of the matters or things therein provided for,
after giving effect to the required consents and approvals referred to in
Section 5.11 hereof, contravene or constitute default under any provision of law
or any judgment, injunction, order or decree binding upon the Company or any
provision of the charter, articles of incorporation, or by-laws of the Company
or any material covenant, indenture, or agreement of or affecting the Company or
any of its Properties, or result in the creation or imposition of any Lien on
any Property of the Company. Prior to or concurrently with the Company
requesting the initial extension of credit under this Agreement, all conditions
to the Merger shall have been satisfied (including, without limitation, all
necessary shareholder and governmental consents), all filings and other matters
necessary to make the Merger effective shall have been done and performed, and
the Merger shall have become effective in accordance with the terms of the
Merger Documents.

Section 5.18. No Default. No Default or Event of Default has occurred and is
continuing.

SECTION 6. CONDITIONS PRECEDENT.

The obligation of the Lender to make any Loan or to issue any Letter of Credit
under this Agreement is subject to the following conditions precedent:

Section 6.1. All Advances. As of the time of the making of each extension of
credit (including the initial extension of credit) hereunder:

(a) each of the representations and warranties set forth in Section 5 hereof and
in the other Loan Documents shall be true and correct in all material respects
as of such time, except to the extent the same expressly relate to an earlier
date;

(b) no Default or Event of Default shall have occurred and be continuing or
would occur as a result of making such extension of credit;

(c) after giving effect to such extension of credit, the aggregate principal
amount of all Revolving Credit Loans and Letters of Credit outstanding under
this Agreement shall not exceed the Revolving Credit Commitment then in effect;

(d) in the case of the issuance of any Letter of Credit, the Lender shall have
received a properly completed Application therefor together with the fees called
for hereby; and

 

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(e) such extension of credit shall not violate any order, judgment or decree of
any court or other authority or any provision of law or regulation applicable to
the Lender (including, without limitation, Regulation U of the Board of
Governors of the Federal Reserve System) as then in effect.

The Company’s request for any Loan or Letter of Credit shall constitute its
warranty as to the facts specified in subsections (a) through (d), both
inclusive, above.

Section 6.2. Initial Advance. At or prior to the making of the initial extension
of credit hereunder, the following conditions precedent shall also have been
satisfied:

(a) the Lender shall have received the following (each to be properly executed
and completed) and the same shall have been approved as to form and substance by
the Lender:

(i) the Agreement and the Notes;

(ii) certified copies of resolutions adopted by the Board of Directors of the
Company authorizing execution and delivery of this Agreement and the other Loan
Documents to the extent the Lender or its counsel may reasonably request;

(iii) an incumbency certificate containing the name, title and genuine
signatures of each of the Company’s Authorized Representatives;

(iv) an arrangement fee letter; and

(v) participation agreements with JPMorgan Chase Bank, National Association, and
LaSalle Bank, National Association relating to their purchase of not less than
$29,000,000 of the Revolving Credit Commitment and $55,000,000 of the Term Loan
Commitment (and such participants shall have funded their share of the Loans
being participated to them thereunder);

(b) the Lender shall have received the initial fees called for hereby;

(c) the Lender shall have received the favorable written opinion of counsel for
the Company in substantially the form attached hereto as Exhibit D;

(d) the Lender shall have been furnished copies, certified as being true and
correct by the Secretary or other officer of the Company acceptable to the
Lender, of (i) the Proxy Statement and Prospectus dated November 7, 2005, and
all amendments and supplements thereto, (ii) the Agreement and Plan of
Reorganization, between the Company and EFC and all amendments and supplements
thereto, (iii) copy of the Certificate of Merger filed with the Delaware
Secretary of State as to the merger of EFC with and into the Company,
(iv) approval letter as to the Merger from the Office of Thrift Supervision and
acknowledgement letter from the Illinois Department of Financial and
Professional Regulation, (v) evidence of shareholder approval of the Merger from
the

 

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shareholders of EFC, (vi) certified copies of the Resolutions adopted by the
Board of Directors of the Company and of EFC authorizing the execution,
delivery, and performance of the Merger Documents and the consummation of the
transaction contemplated thereby, and (vii) the opinion letter delivered by
counsel to EFC to the Company with respect to the Merger;

(e) the Lender shall have received a good standing certificate for the Company
(dated as of the date no earlier than 30 days prior to the date hereof) from the
office of the secretary of state of the state of its incorporation and each
state in which it is qualified to do business as a foreign corporation, and a
certificate from the Office of Thrift Supervision as to the registration of the
Company as a savings and loan holding company;

(f) the Lender shall have been furnished a statement by the Company as to the
sources and uses of cash required to finance the Merger; and

(g) by signing in the space provided for that purpose below, the parties agree
that the Credit Agreement dated as of November 30, 2001, as amended, between the
Company and the Bank will be, effective upon the making of the initial extension
of credit hereunder, terminated and no further borrowings may be made
thereunder, and any loans outstanding thereunder and the Letters of Credit
issued pursuant to the terms thereof shall remain outstanding as part of the
initial advance of Loans made hereunder and Letters of Credit issued hereunder
(and all applications for such Letters of Credit shall be deemed Applications
issued pursuant to the terms hereof).

SECTION 7. COVENANTS.

The Company agrees that, at the time the initial extension of credit is made to
the Company under this Agreement and thereafter so long as any credit is
available to or in use by the Company hereunder, except to the extent compliance
in any case or cases is waived in writing by the Lender:

Section 7.1. Maintenance of Business. The Company shall, and shall cause each
Subsidiary to, preserve and maintain its existence; provided, however, that
nothing in this Section shall prevent the Company from dissolving any Subsidiary
(other than a Banking Subsidiary or MAF Developments) if such action is, in the
judgment of the Company, desirable in the conduct of its business and is not
disadvantageous in any material respect to the Lender. The Company shall, and
shall cause each Subsidiary to, preserve and keep in force and effect all
licenses, permits and franchises necessary to the proper conduct of its
business; provided, however, that nothing in this Section shall prevent the
Company or any Subsidiary (other than a Banking Subsidiary or MAF Developments)
from permitting any license, permit or franchise to lapse if such action is, in
the judgment of the Company, desirable in the conduct of its business and is not
disadvantageous in any material respect to the Lender.

Section 7.2. Maintenance of Properties. The Company shall maintain, preserve and
keep its property, plant and equipment in good repair, working order and
condition (ordinary

 

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wear and tear excepted) and shall from time to time make all needful and proper
repairs, renewals, replacements, additions and betterments thereto so that at
all times the efficiency thereof shall be preserved and maintained in all
material respects, and shall cause each Subsidiary to do so in respect of
Property owned or used by it; provided, however, that nothing in this Section
shall prevent (a) the Company or any Subsidiary (other than a Banking Subsidiary
or MAF Developments) from discontinuing the operation and maintenance of any of
its properties if such discontinuation is, in the judgment of the Company,
desirable in the conduct of its business and is not disadvantageous in any
material respect to the Lender or (b) any Banking Subsidiary from closing or
selling a branch office if such closing or sale is, in the judgment of the
Company, desirable in the conduct of its business and is not disadvantageous in
any material respect to the Lender.

Section 7.3. Taxes and Assessments. The Company shall duly pay and discharge,
and shall cause each Subsidiary to duly pay and discharge, all taxes, rates,
assessments, fees and governmental charges upon or against it or its Properties,
in each case before the same become delinquent and before penalties accrue
thereon, unless and to the extent that the same are being contested in good
faith and by appropriate proceedings which prevent enforcement of the matter
under contest and adequate reserves are provided therefor.

Section 7.4. Insurance. The Company shall insure and keep insured, and shall
cause each Subsidiary to insure and keep insured, with good and responsible
insurance companies, all insurable Property owned by it which is of a character
usually insured by Persons similarly situated and operating like Properties
against loss or damage from such hazards and risks, and in such amounts, as are
insured by Persons similarly situated and operating like Properties; and the
Company shall insure, and shall cause each Subsidiary to insure, such other
hazards and risks (including employers’ and public liability risks) with good
and responsible insurance companies as and to the extent usually insured by
Persons similarly situated and conducting similar businesses. The Company shall
upon request furnish to the Lender a certificate setting forth in summary form
the nature and extent of the insurance maintained pursuant to this Section.

Section 7.5. Financial Reports. The Company shall, and shall cause each
Subsidiary to, maintain a standard system of accounting in accordance with GAAP
and shall furnish to the Lender and its duly authorized representatives, subject
to Section 9.9 hereof, such information respecting the business and financial
condition of the Company and its Subsidiaries (including non-financial
information and examination reports and supervisory letters to the extent
permitted by applicable regulatory authorities) as the Lender may reasonably
request; and without any request, shall furnish to the Lender:

(a) as soon as available, and in any event within 50 days after the close of
each fiscal quarter of the Company, a copy of the consolidated balance sheet of
the Company and its Subsidiaries as of the last day of such period and the
consolidated statements of income of the Company and its Subsidiaries for the
quarter and for the fiscal year-to-date period then ended and the consolidated
statements of stockholders’ equity and cash flows for the fiscal year-to-date
period then ended, each in reasonable detail showing in comparative form the
figures for the corresponding date and period in the previous fiscal year,
prepared by the Company in accordance with GAAP (subject to

 

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year-end audit adjustments and the absence of footnote disclosures) and
certified to by the Chief Executive Officer or Chief Financial Officer of the
Company;

(b) as soon as available, and in any event within 120 days after the close of
each fiscal year of the Company, a copy of the consolidated balance sheet of the
Company and its Subsidiaries as of the close of such fiscal year and the
consolidated statements of income, retained earnings and cash flows of the
Company and its Subsidiaries for such fiscal year, and accompanying notes
thereto, each in reasonable detail showing in comparative form the figures for
the previous fiscal year, accompanied by an unqualified opinion thereon of KPMG
LLP or another firm of independent public accountants of recognized national
standing selected by the Company, to the effect that the financial statements
have been prepared in accordance with GAAP and present fairly in accordance with
GAAP the consolidated financial condition of the Company and its Subsidiaries as
of the close of such fiscal year and the results of their operations and cash
flows for the fiscal year then ended and that an examination of such accounts in
connection with such financial statements has been made in accordance with
generally accepted auditing standards and, accordingly, such examination
included such tests of the accounting records and such other auditing procedures
as were considered necessary in the circumstances;

(c) as soon as available, and in any event within 50 days after the close of
each fiscal quarter of each Banking Subsidiary, all call reports and other
financial statements required to be delivered by such Banking Subsidiary to any
governmental authority or authorities having jurisdiction over such Banking
Subsidiary and all schedules thereto;

(d) promptly after receipt thereof, any additional written reports, management
letters or other detailed information contained in writing concerning
significant aspects of the Company’s or any Subsidiary’s operations and
financial affairs given to it by its independent public accountants;

(e) promptly upon the furnishing thereof to the shareholders of the Company,
copies of all financial statements, reports and proxy statements so furnished;

(f) promptly upon the filing thereof, copies of all registration statements,
Form 10-K, Form 10-Q and Form 8-K reports and proxy statements which the Company
or any of its Subsidiaries file with the Securities and Exchange Commission;

(g) promptly upon the receipt or execution thereof, (i) notice by the Company or
any Banking Subsidiary that (1) it has received a request or directive from any
federal or state regulatory agency which requires it to submit a capital
maintenance or restoration plan or restricts the payment of dividends by any
Banking Subsidiary to the Company or (2) it has submitted a capital maintenance
or restoration plan to any federal or state regulatory agency or has entered
into a memorandum or agreement with any such agency, including, without
limitation, any agreement which restricts the payment of dividends by any
Banking Subsidiary to the Company or otherwise imposes restrictions or

 

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requirements on it which are not generally applicable to banks or thrifts or
their holding companies, and (ii) copies of any such plan, memorandum, or
agreement, unless disclosure is prohibited by the terms thereof and, after the
Company or such Banking Subsidiary has in good faith attempted to obtain the
consent of such regulatory agency, such agency will not consent to the
disclosure of such plan, memorandum, or agreement to the Lender;

(h) prompt written notice of a Change of Control; and

(i) promptly after knowledge thereof shall have come to the attention of any
responsible officer of the Company, written notice of any threatened or pending
litigation or governmental proceeding or labor controversy against the Company
or any Subsidiary which, if adversely determined, could reasonably be expected
to materially and adversely effect the financial condition, Properties, business
or operations of the Company or any Subsidiary or of the occurrence of any
Default or Event of Default hereunder.

Each of the financial statements furnished to the Lender pursuant to
subsections (a) and (b) of this Section shall be accompanied by a written
certificate in the form attached hereto as Exhibit C signed by the Chief
Executive Officer or Chief Financial Officer of the Company to the effect that
to the best of such officer’s knowledge and belief no Default or Event of
Default has occurred during the period covered by such statements or, if any
such Default or Event of Default has occurred during such period, setting forth
a description of such Default or Event of Default and specifying the action, if
any, taken by the Company to remedy the same. Such certificate shall also set
forth the calculations supporting such statements with respect to Sections 7.7,
7.9 and 7.10 of this Agreement.

Section 7.6. Inspection. Subject to Section 9.9 hereof, the Company shall, and
shall cause each Subsidiary to, permit the Lender and its duly authorized
representatives and agents to visit and inspect any of the Properties, corporate
books and financial records of the Company and each Subsidiary, to examine and
make copies of the books of accounts and other financial records of the Company
and each Subsidiary, and to discuss the affairs, finances and accounts of the
Company and each Subsidiary with, and to be advised as to the same by, its
officers, employees and independent public accountants (and by this provision
the Company hereby authorizes such accountants to discuss with the Lender the
finances and affairs of the Company and of each Subsidiary) at such reasonable
times and reasonable intervals as the Lender may designate; provided, however,
that neither the Company nor any Subsidiary shall be required to make available
to the Lender any customer lists or other proprietary information unless such
information is required by the Lender to determine the financial condition of
the Company or any Subsidiary or to determine the ability of the Company to meet
its obligations hereunder.

Section 7.7. Non-Performing Assets. The Company shall, as of the last day of
each fiscal quarter, maintain on a consolidated basis with its Subsidiaries, and
shall cause each Banking Subsidiary to maintain as of such day on a consolidated
basis with its subsidiaries, a ratio (a) of Non-Performing Assets of the Company
or such Banking Subsidiary on a consolidated basis, as the case may be, to
(b) the sum of (i) stockholders’ equity for the Company or core capital for such
Banking Subsidiary, as the case may be, plus (ii) loan loss

 

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reserves established by the Company or such Banking Subsidiary, as the case may
be, on a consolidated basis in accordance with regulatory accounting principles
applicable to the Company or such Banking Subsidiary, of not more than .20 to
1.0.

Section 7.8. Regulatory Capital Requirements. (a) Each Banking Subsidiary shall
at all times be at least “well capitalized” as defined in the Federal Deposit
Insurance Corporation Improvement Act of 1991 and any regulations to be issued
thereunder, as such statute or regulations may each be amended or supplemented
from time to time.

(b) The requirements described in subsection (a) above shall be computed and
determined in accordance with the rules and regulations as in effect from time
to time established by the rules and regulations as in effect from time to time
established by the appropriate governmental authority having jurisdiction over
the Company or such Banking Subsidiary. In addition to the provisions set forth
above, the Company shall, and shall cause each Banking Subsidiary to, comply
with any and all capital guidelines and requirements as in effect from time to
time established by the relevant governmental authority or authorities having
jurisdiction over the Company or any Banking Subsidiary.

Section 7.9. Adjusted Net Worth. The Company shall, as of the last day of each
fiscal quarter of the Company, maintain Adjusted Net Worth of the Company and
its Subsidiaries determined on a consolidated basis in an amount not less than
$500,000,000.

Section 7.10. Adjusted Net Income. As of the last day of each fiscal year of the
Company, the Company shall have Adjusted Net Income for the year then ended of
not less than $85,000,000.

Section 7.11. Indebtedness for Borrowed Money. The Company shall not, nor shall
it permit any Subsidiary to, issue, incur, assume, create or have outstanding
any Indebtedness for Borrowed Money; provided, however, that the foregoing shall
not restrict nor operate to prevent:

(a) the Obligations of the Company owing to the Lender hereunder and under the
other Loan Documents and any other indebtedness or obligations of the Company or
any Subsidiary owing to the Lender;

(b) Permitted Banking Subsidiary Indebtedness;

(c) indebtedness of the Company or any Subsidiary owing to the Company or any
Subsidiary;

(d) Contingent Obligations incurred with respect to (i) the endorsement of
instruments for deposit or collection in the ordinary course of business and
(ii) private mortgage reinsurance arrangements through Mid America Re, Inc., in
the ordinary course of business;

(e) obligations of the Company or MAF Developments arising under or in
connection with letters of credit issued by or for the benefit of the Company or
MAF

 

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Developments (and any joint venture in which MAF Development is a partner)
relating to land development activities of the Company or MAF Developments (and
any joint venture in which MAF Developments is a partner) in an aggregate amount
not to exceed $60,000,000 at any one time outstanding;

(f) indebtedness consisting of (i) unsecured Subordinated Debt and (ii) junior
subordinated debentures issued by the Company in connection with trust preferred
securities issued by one or more of the Company’s Wholly-Owned Subsidiaries
qualifying as Tier 1 Capital under the Federal Reserve Capital Requirements, and
the Company’s performance guarantee of such Subsidiary’s obligation to remit all
payments made by the Company to such Subsidiary in respect of the junior
subordinated debentures to the holder of the such Subsidiary’s trust preferred
securities, all on terms and conditions reasonably acceptable to the Lender;

(g) indebtedness of MAF Developments (or joint venture Subsidiary) as purchaser
under land purchase contracts entered into in the ordinary course of its land
development activities and any cost to complete liabilities related thereto and
amounts due to joint venture partners incurred in the ordinary course of its
land development activities;

(h) indebtedness of the Company or any Banking Subsidiary as purchaser under
land purchase contracts for branch sites for Banking Subsidiaries entered into
in the ordinary course of business;

(i) currently outstanding indebtedness of the Company and of its Subsidiaries
not otherwise permitted under this Section which is disclosed on Schedule 7.11
attached hereto;

(j) unsecured indebtedness of the Company or any Subsidiary not otherwise
permitted under this Section in an aggregate amount not to exceed $15,000,000 at
any one time outstanding, except that, in the event the Revolving Credit
Commitment is terminated in whole either at the Revolving Credit Termination
Date or otherwise (except by virtue of an Event of Default), the limitation on
additional indebtedness imposed by this Section 7.11(j) shall be increased to
$60,000,000 in the aggregate at any one time outstanding; and

(k) performance or surety bonds for the benefit of the Company or MAF
Developments (or any joint venture in which MAF Developments is a partner) in
the ordinary course of land development activities.

Section 7.12. Liens. The Company shall not, nor shall it permit any Subsidiary
to, create, incur or permit to exist any Lien of any kind on any stock or other
equity interest of any kind in any Subsidiary, whether now or hereafter owned,
directly or indirectly, by the Company or any Subsidiary.

 

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Section 7.13. Mergers and Consolidations. The Company shall not, nor shall it
permit any Banking Subsidiary or MAF Developments to, be a party to any merger
or consolidation in which the Company, the Banking Subsidiary or MAF
Developments is not the surviving entity unless, at or prior to the consummation
of any such event, the Obligations are paid in full and the Commitments are
terminated in full.

Section 7.14. Maintenance of Subsidiaries. The Company shall not assign, sell or
transfer, or permit any Banking Subsidiary or MAF Developments to issue, assign,
sell or transfer, any shares of capital stock of a Banking Subsidiary or MAF
Developments unless, at or prior to the consummation of any such event, the
Obligations are paid in full and the Commitments are terminated in full;
provided that the foregoing shall not operate to prevent the issuance, sale and
transfer to any person of any shares of capital stock of a Banking Subsidiary or
MAF Developments solely for the purpose of qualifying, and to the extent legally
necessary to qualify, such person as a director of such Banking Subsidiary or
MAF Developments.

Section 7.15. Dividends and Certain Other Restricted Payments. The Company shall
not during any fiscal year (a) declare or pay any dividends on or make any other
distributions in respect of any class or series of its capital stock (other than
dividends payable solely in its capital stock) or (b) directly or indirectly
purchase, redeem or otherwise acquire or retire any of its capital stock
(collectively, “Restricted Payments”); provided, however, that the Company may
make any such Restricted Payment so long as no Default or Event of Default then
exists or would arise after giving effect thereto.

Section 7.16. ERISA. The Company shall, and shall cause each Subsidiary to,
promptly pay and discharge all obligations and liabilities arising under ERISA
of a character which if unpaid or unperformed might result in the imposition of
a Lien against any of its Properties. The Company shall, and shall cause each
Subsidiary to, promptly notify the Lender of (a) the occurrence of any material
adverse reportable event (as defined in ERISA) with respect to a Plan,
(b) receipt of any notice from the PBGC of its intention to seek termination of
any Plan or appointment of a trustee therefor, (c) its intention to terminate or
withdraw from any Plan, and (d) the occurrence of any event with respect to any
Plan which would result in the incurrence by the Company or any Subsidiary of
any material liability, fine or penalty, or any material increase in the
contingent liability of the Company or any Subsidiary with respect to any
post-retirement Welfare Plan benefit.

Section 7.17. Compliance with Laws. The Company shall, and shall cause each
Subsidiary to, comply in all respects with the requirements of all federal,
state and local laws, rules, regulations, ordinances and orders applicable to or
pertaining to their Properties or business operations, non-compliance with which
could reasonably be expected to have a material adverse effect on the financial
condition, Properties, business or operations of the Company and its
Subsidiaries taken as a whole or could result in a Lien upon any material
portion of their Property.

Section 7.18. Burdensome Contracts With Affiliates. The Company shall not, nor
shall it permit any Subsidiary to, enter into any material contract, agreement
or business arrangement with any of its Affiliates on terms and conditions which
are less favorable to the Company or

 

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such Subsidiary than would be usual and customary in similar contracts,
agreements or business arrangements between Persons not affiliated with each
other.

Section 7.19. Change in the Nature of Business. The Company shall not, and shall
not permit any Subsidiary to, engage in any business or activity if as a result
the general nature of the business of the Company or any Subsidiary would be
changed in any material respect from the general nature of the business engaged
in by the Company or such Subsidiary on the date of this Agreement (after giving
effect to the consummation of the Merger).

Section 7.20. Subordinated Debt. The Company shall not, nor shall it permit any
Subsidiary to, amend or modify in any material respect any of the terms and
conditions relating to any Subordinated Debt or make any voluntary prepayment
thereof or effect any voluntary redemption thereof or make any payment on
account of any Subordinated Debt which in any such case is prohibited under the
terms of any instrument or agreement subordinating the same to the Obligations.

SECTION 8. EVENTS OF DEFAULT AND REMEDIES.

Section 8.1. Events of Default. Any one or more of the following shall
constitute an “Event of Default” hereunder:

(a) default in the payment when due of all or any part of the principal of any
Note (whether at the stated maturity thereof or at any other time provided for
in this Agreement) or of any reimbursement obligation owing under any
Application, or default for a period of 5 days in the payment when due of any
interest on any Note or of any fee or other Obligation payable by the Company
hereunder or under any other Loan Document; or

(b) default in the observance or performance of any covenant set forth in
Sections 7.5(i), 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.13, or 7.14 hereof; or

(c) default in the observance or performance of any provision of Section 7.5
hereof (other than Section 7.5(i) referred to in Section 8.1(b) above) which is
not remedied within 5 days after the occurrence thereof, or default in the
observance or performance of any other provision hereof or of any other Loan
Document which is not remedied within 30 days after written notice thereof is
given to the Company by the Lender; or

(d) any representation or warranty made by the Company herein or in any other
Loan Document, or in any statement or certificate furnished by it pursuant
hereto or thereto, or in connection with any extension of credit made hereunder,
proves untrue in any material respect as of the date of the issuance or making
thereof; or

(e) default shall occur under any Indebtedness for Borrowed Money aggregating
more than $5,000,000 issued, assumed or guaranteed by the Company or any
Subsidiary, or under any indenture, agreement or other instrument under which
the same

 

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may be issued, and such default shall continue for a period of time sufficient
to permit the acceleration of the maturity of any such Indebtedness for Borrowed
Money (whether or not such maturity is in fact accelerated), or any such
Indebtedness for Borrowed Money shall not be paid when due (whether by lapse of
time, acceleration or otherwise); or

(f) any judgment or judgments, writ or writs, or warrant or warrants of
attachment, or any similar process or processes, the aggregate amount of which
(after reduction by the amount covered by insurance) exceeds $5,000,000, shall
be entered or filed against the Company or any Subsidiary or against any of
their Property and which remains unvacated, unbonded, unstayed or unsatisfied
for a period of 45 days; or

(g) the Company or any member of its Controlled Group shall fail to pay when due
an amount or amounts aggregating in excess of $500,000 which it shall have
become liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice
of intent to terminate a Plan or Plans having aggregate Unfunded Vested
Liabilities in excess of $500,000 (collectively, a “Material Plan”) shall be
filed under Title IV of ERISA by the Company or any other member of its
Controlled Group, any plan administrator or any combination of the foregoing; or
the PBGC shall institute proceedings under Title IV of ERISA to terminate or to
cause a trustee to be appointed to administer any Material Plan or a proceeding
shall be instituted by a fiduciary of any Material Plan against the Company or
any member of its Controlled Group to enforce Section 515 or 4219(c)(5) of ERISA
and such proceeding shall not have been dismissed within 30 days thereafter; or
a condition shall exist by reason of which the PBGC would be entitled to obtain
a decree adjudicating that any Material Plan must be terminated; or

(h) dissolution or termination of the existence of the Company or any Banking
Subsidiary or MAF Developments; or

(i) any conservator or receiver shall be appointed for the Company or any
Banking Subsidiary under applicable federal or state law applicable to banks,
thrifts, or their holding companies, or any Banking Subsidiary shall suspend
payment of any material portion of its obligations, or any Banking Subsidiary
shall cease to be a federally insured depositary institution, or a cease and
desist order shall be issued against the Company or any Banking Subsidiary
pursuant to applicable federal or state law applicable to banks, thrifts, or
their holding companies which has or is reasonably likely to have a material
adverse effect on the condition (financial or otherwise), Properties or business
prospects of such Persons, or the Company or any Banking Subsidiary shall enter
into any commitment to maintain the capital of an insured depository institution
in a required amount with any federal or state regulator or any such regulator
shall require the Company or any Banking Subsidiary to submit a capital
maintenance or restoration plan; or

(j) the Company, any Banking Subsidiary, or MAF Developments shall (i) have
entered involuntarily against it an order for relief under the United States
Bankruptcy Code, as amended, (ii) not pay, or admit in writing its inability to
pay, its debts generally as they become due, (iii) make an assignment for the
benefit of creditors,

 

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(iv) apply for, seek, consent to, or acquiesce in, the appointment of a
receiver, custodian, trustee, examiner, liquidator or similar official for it or
any substantial part of its Property, (v) institute any proceeding seeking to
have entered against it an order for relief under the United States Bankruptcy
Code, as amended, to adjudicate it insolvent, or seeking dissolution, winding
up, liquidation, reorganization, arrangement, adjustment or composition of it or
its debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (vi) take any
corporate action in furtherance of any matter described in parts (i) through
(v) above, or (vii) fail to contest in good faith any appointment or proceeding
described in Section 8.1(k) hereof; or

(k) a custodian, receiver, trustee, examiner, liquidator or similar official
shall be appointed for the Company, any Banking Subsidiary, or MAF Developments
or any substantial part of any of their Property, or a proceeding described in
Section 8.1(j)(v) shall be instituted against the Company, any Banking
Subsidiary, or MAF Developments, and such appointment continues undischarged or
such proceeding continues undismissed or unstayed for a period of 60 days.

Section 8.2. Non-Bankruptcy Defaults. When any Event of Default, other than
those described in subsection (j) or (k) of Section 8.1 hereof, has occurred and
is continuing, the Lender may, by written notice to the Company, do all or any
of the following: (a) terminate the remaining Commitments and all other
obligations of the Lender hereunder on the date stated in such notice (which may
be the date thereof); (b) declare the principal of and the accrued interest on
all outstanding Notes to be forthwith due and payable and thereupon all
outstanding Notes, including both principal and interest thereon, shall be and
become immediately due and payable together with all other amounts payable under
the Loan Documents without further demand, presentment, protest or notice of any
kind; and (c) demand that the Company immediately pay to the Lender the full
amount then available for drawing under each or any Letter of Credit, and the
Company agrees to immediately make such payment and acknowledges and agrees that
the Lender would not have an adequate remedy at law for failure by the Company
to honor any such demand and that the Lender shall have the right to require the
Company to specifically perform such undertaking whether or not any drawings or
other demands for payment have been made under any Letter of Credit.

Section 8.3. Bankruptcy Defaults. When any Event of Default described in
subsection (j) or (k) of Section 8.1 hereof has occurred and is continuing, then
all outstanding Notes shall immediately become due and payable together with all
other amounts payable under the Loan Documents without presentment, demand,
protest or notice of any kind, the obligation of the Lender to extend further
credit pursuant to any of the terms hereof shall immediately terminate and the
Company shall immediately pay to the Lender the full amount then available for
drawing under all outstanding Letters of Credit, the Company acknowledging and
agreeing that the Lender would not have an adequate remedy at law for failure by
the Company to honor any such demand and that the Lender shall have the right to
require the Company to specifically perform such undertaking whether or not any
draws or other demands for payment have been made under any of the Letters of
Credit.

 

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Section 8.4. Collateral for Undrawn Letters of Credit. (a) If the prepayment of
the amount available for drawing under any or all outstanding Letters of Credit
is required under Section 1.3(b), 3.3, 8.2, or 8.3 hereof, the Company shall
forthwith pay the amount required to be so prepaid, to be held by the Lender as
provided in subsection (b) below.

(b) All amounts prepaid pursuant to subsection (a) above shall be held by the
Lender in a separate collateral account (such account, and the credit balances,
properties and any investments from time to time held therein, and any
substitutions for such account, any certificate of deposit or other instrument
evidencing any of the foregoing and all proceeds of and earnings on any of the
foregoing being collectively called the “Account”) as security for, and for
application by the Lender (to the extent available) to, the reimbursement of any
payment under any Letter of Credit then or thereafter made by the Lender, and to
the payment, after the occurrence of any Event of Default, of the unpaid balance
of any Loans and all other Obligations. The Account shall be held in the name of
and subject to the exclusive dominion and control of the Lender. If and when
requested by the Company, the Lender shall invest funds held in the Account from
time to time in direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America with a remaining maturity of one year or less, provided that the Lender
is irrevocably authorized to sell investments held in the Account when and as
required to make payments out of the Account for application to amounts due and
owing from the Company to the Lender; provided, however, that if (i) the Company
shall have made payment of all such obligations referred to in subsection
(a) above, (ii) all relevant preference or other disgorgement periods relating
to the receipt of such payments have passed, and (iii) no Letters of Credit,
Commitments, or other Obligations then due and owing remain outstanding
hereunder, then the Lender shall release to the Company, at its request, any
remaining amounts held in the Account.

SECTION 9. MISCELLANEOUS.

Section 9.1. Non-Business Days. If any payment hereunder becomes due and payable
on a day which is not a Business Day, the due date of such payment shall be
extended to the next succeeding Business Day on which date such payment shall be
due and payable. In the case of any payment of principal falling due on a day
which is not a Business Day, interest on such principal amount shall continue to
accrue during such extension at the rate per annum then in effect, which accrued
amount shall be due and payable on the next scheduled date for the payment of
interest.

Section 9.2. No Waiver, Cumulative Remedies. No delay or failure on the part of
the Lender or on the part of any holder of any of the Obligations in the
exercise of any power or right shall operate as a waiver thereof or as an
acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise of
any other power or right. The rights and remedies hereunder of the Lender and
any of the holders of the Obligations are cumulative to, and not exclusive of,
any rights or remedies which any of them would otherwise have.

 

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Section 9.3. Amendments. Any provision of this Agreement or the other Loan
Documents may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed by the Company and the Lender.

Section 9.4. Costs and Expenses. The Company agrees to pay on demand the costs
and expenses of the Lender in connection with the negotiation, preparation,
execution and delivery of this Agreement, the other Loan Documents and the other
instruments and documents to be delivered hereunder or thereunder, and in
connection with the transactions contemplated hereby or thereby, and in
connection with any consents hereunder or waivers or amendments hereto or
thereto, including the fees and expenses of counsel for the Lender with respect
to all of the foregoing (whether or not the transactions contemplated hereby are
consummated). Notwithstanding anything in the foregoing to the contrary, the
Company shall not be liable, without its consent, for more than $7,500 of the
legal fees of Chapman and Cutler LLP, counsel to the Lender, in connection with
the preparation, negotiation and execution of this Agreement and the other Loan
Documents to be delivered on or prior to the initial extension of credit
hereunder. The Company further agrees to pay to the Lender all costs and
expenses (including court costs and attorneys’ fees), if any, incurred or paid
by the Lender in connection with any Default or Event of Default or in
connection with the enforcement of this Agreement or any of the other Loan
Documents or any other instrument or document delivered hereunder or thereunder.
The Company further agrees to indemnify and save the Lender and any security
trustee for the Lender harmless from any and all liabilities, losses, costs and
expenses incurred by the Lender, or any such security trustee, in connection
with any action, suit or proceeding brought against the Lender, or any such
security trustee, by any Person which arises out of the transactions
contemplated or financed hereby or out of any action or inaction by the Lender
or any such security trustee hereunder or thereunder, except for such thereof as
is caused by the gross negligence or willful misconduct of the party seeking to
be indemnified. The provisions of this Section and the protective provisions of
Section 2 hereof shall survive payment of the Obligations.

Section 9.5. Documentary Taxes. The Company agrees to pay on demand any
documentary, stamp or similar taxes payable in respect of this Agreement or any
other Loan Document, including interest and penalties, in the event any such
taxes are assessed, irrespective of when such assessment is made and whether or
not any credit is then in use or available hereunder.

Section 9.6. Survival of Representations. All representations and warranties
made herein or in any of the other Loan Documents or in certificates given
pursuant hereto or thereto shall survive the execution and delivery of this
Agreement and the other Loan Documents, and shall continue in full force and
effect with respect to the date as of which they were made as long as any credit
is in use or available hereunder.

Section 9.7. Participations. The Lender may grant participations in its
extensions of credit hereunder to any other bank or other lending institution (a
“Participant”), provided that (a) no Participant shall thereby acquire any
direct rights under this Agreement and (b) no sale of a participation in
extensions of credit shall in any manner relieve the Lender of its obligations
hereunder.

 

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Section 9.8. Notices. Except as otherwise specified herein, all notices
hereunder shall be in writing (including, without limitation, notice by
telecopy) and shall be given to the relevant party at its address or telecopier
number set forth below, or such other address or telecopier number as such party
may hereafter specify by notice to the other given by courier, by United States
certified or registered mail, by telecopy or by other telecommunication device
capable of creating a written record of such notice and its receipt. Notices
hereunder to the Company or Lender, respectively, shall be addressed to:

 

MAF Bancorp, Inc.

   Harris N.A.

55th Street and Holmes Avenue

   111 West Monroe Street

Clarendon Hills, Illinois 60514

   Chicago, Illinois 60603

Attention:

   Mr. Jerry Weberling    Attention:    Mr. Michael Cameli

Telephone:

   (630) 887-5999    Telephone:    (312) 461-2396

Telecopy:

   (630) 325-0407    Telecopy:    (312) 765-8382

with a copy of all written notices of default also to:

     

MAF Bancorp, Inc.

     

55th Street and Holmes Avenue

     

Clarendon Hills, Illinois 60514

     

Attention:

  

Jennifer R. Evans,

General Counsel

     

Telephone:

   (630) 986-6436      

Telecopy:

   (630) 649-7172      

Each such notice, request or other communication shall be effective (a) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section and a confirmation of such telecopy has been received
by the sender, (b) if given by mail, five (5) days after such communication is
deposited in the mail, certified or registered with return receipt requested,
addressed as aforesaid or (c) if given by any other means, when delivered at the
addresses specified in this Section; provided that any notice given pursuant to
Section 1 or Section 2 hereof shall be effective only upon receipt.

Section 9.9. Confidentiality. The Lender shall hold in confidence any nonpublic
information delivered or made available to it by the Company or any Subsidiary
or their respective officers, employees and independent public accountants. The
foregoing to the contrary notwithstanding, nothing herein shall prevent the
Lender from disclosing any information delivered or made available to it by the
Company or any Subsidiary (a) in the absence of a protection order, upon the
order of any court or administrative agency, (b) upon the request or demand of
any regulatory agency or authority, (c) which has been publicly disclosed other
than as a result of a disclosure by the Lender which is not permitted by this
Agreement, (d) in connection with any litigation to which the Lender or any of
its Affiliates may be a party, along with the Company, any Subsidiary or any of
their respective Affiliates, (e) to the extent reasonably required in connection
with the exercise of any right or remedy under this Agreement, the other Loan
Documents or otherwise, (f) to legal counsel and financial consultants and
independent auditors of the Lender, and (g) to any actual or proposed
participant

 

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or assignee of all or part of its rights under the credit contemplated hereby
provided such participant or assignee agrees in writing to be bound by the duty
of confidentiality under this Section to the same extent as if it were the
Lender hereunder; provided, however, if any person seeks to compel the Lender to
disclose any such nonpublic information under compulsion of law, the Lender
shall in good faith endeavor to notify the Company thereof so that the Company
may have an opportunity to seek a protection order or other remedy.

Section 9.10. Headings. Section headings used in this Agreement are for
convenience of reference only and are not a part of this Agreement for any other
purpose.

Section 9.11. Severability of Provisions. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction. All rights, remedies and powers provided in this Agreement and the
other Loan Documents may be exercised only to the extent that the exercise
thereof does not violate any applicable mandatory provisions of law, and all the
provisions of this Agreement and the other Loan Documents are intended to be
subject to all applicable mandatory provisions of law which may be controlling
and to be limited to the extent necessary so that they will not render this
Agreement or the other Loan Documents invalid or unenforceable.

Section 9.12. Counterparts. This Agreement may be executed in any number of
counterparts, and by different parties hereto on separate counterpart signature
pages, and all such counterparts taken together shall be deemed to constitute
one and the same instrument.

Section 9.13. Entire Understanding. This Agreement together with the other Loan
Documents constitute the entire understanding of the parties with respect to the
subject matter hereof and any prior agreements, whether written or oral, with
respect thereto are superseded hereby.

Section 9.14. Binding Nature, Governing Law, Etc. This Agreement shall be
binding upon the Company and its successors and assigns, and shall inure to the
benefit of the Lender and the benefit of its successors and assigns, including
any subsequent holder of an interest in the Obligations. The Company may not
assign its rights hereunder without the written consent of the Lender. THIS
AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF ILLINOIS
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

Section 9.15. Submission to Jurisdiction; Waiver of Jury Trial. The Company
hereby submits to the non-exclusive jurisdiction of the United States District
Court for the Northern District of Illinois and of any Illinois State court
sitting in the City of Chicago for purposes of all legal proceedings arising out
of or relating to this Agreement, the other Loan Documents or the transactions
contemplated hereby or thereby. The Company irrevocably waives, to the fullest
extent permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum. THE COMPANY AND THE LENDER EACH HEREBY IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY

 

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LEGAL PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY.

[SIGNATURE PAGE TO FOLLOW]

 

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Upon your acceptance hereof in the manner hereinafter set forth, this Agreement
shall constitute a contract between us for the uses and purposes hereinabove set
forth.

Dated as of this 31st day of January, 2006.

 

MAF BANCORP, INC.       By  

/s/ Jerry Weberling

  Jerry Weberling, Executive Vice President & CFO  

 

 

,

 

 

  (Print or Type Name)     (Title)

Accepted and agreed to at Chicago, Illinois, as of the day and year last above
written.

 

HARRIS N.A.

      By  

/s/ Michael S. Cameli

  Michael S. Cameli, Director  

 

 

,

 

 

  (Print or Type Name)     (Title)

 

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EXHIBIT A

MAF BANCORP, INC.

REVOLVING CREDIT NOTE

 

   Chicago, Illinois

$60,000,000

   January 31, 2006

On the Revolving Credit Termination Date, for value received, the undersigned,
MAF BANCORP, INC., a Delaware corporation (the “Company”), hereby promises to
pay to the order of HARRIS N.A. (the “Lender”), at the main office of the Lender
in Chicago, Illinois, the principal sum of (i) Sixty Million Dollars
($60,000,000), or (ii) such lesser amount as may at the time of the maturity
hereof, whether by acceleration or otherwise, be the aggregate unpaid principal
amount of all Revolving Credit Loans owing from the Company to the Lender under
the Revolving Credit provided for in the Credit Agreement hereinafter mentioned.

This Note evidences Revolving Credit Loans made or to be made to the Company by
the Lender under certain Credit Agreement dated as of January 31, 2006, between
the Company and the Lender (said Credit Agreement, as the same may be amended,
modified or restated from time to time, being referred to herein as the “Credit
Agreement”) and the Company hereby promises to pay interest at the office
described above on each loan evidenced hereby at the rates and at the times and
in the manner specified therefor in the Credit Agreement.

This Note is issued by the Company under the terms and provisions of the Credit
Agreement, and this Note and the holder hereof are entitled to all of the
benefits and security provided for thereby or referred to therein, to which
reference is hereby made for a statement thereof. This Note may be declared to
be, or be and become, due prior to its expressed maturity, voluntary prepayments
may be made hereon, and certain prepayments are required to be made hereon, all
in the events, on the terms and with the effects provided in the Credit
Agreement. All capitalized terms used herein without definition shall have the
same meanings herein as such terms are defined in the Credit Agreement.

The Company hereby promises to pay all costs and expenses (including attorneys’
fees) suffered or incurred by the holder hereof in collecting this Note or
enforcing any rights in any collateral therefor. The Company hereby waives
presentment for payment and demand. THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH, AND GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.

 

MAF BANCORP, INC.       By  

 

 

 

 

,

 

 

  (Print or Type Name)     (Title)

--------------------------------------------------------------------------------

EXHIBIT B

MAF BANCORP, INC.

TERM NOTE

 

   Chicago, Illinois

$115,000,000

   January 31, 2006

FOR VALUE RECEIVED, the undersigned, MAF BANCORP, Inc., a Delaware corporation
(the “Company”), hereby promises to pay to the order of HARRIS N.A. (the
“Lender”), at the main office of the Lender in Chicago, Illinois, the principal
sum of One Hundred Fifteen Million Dollars ($115,000,000) or, if less, the
aggregate principal amount of the Term Loan made to the Company under
Section 1.4 of the Credit Agreement hereinafter referred to, in ten
(10) consecutive annual principal installments in the amounts called for by
Section 1.4 of the Credit Agreement hereinafter referred to, commencing on
December 31, 2006, and continuing on the last day of each December thereafter to
and including December 31, 2015, the final maturity hereof.

This Note evidences the Term Loan made to the Company by the Lender under that
certain Credit Agreement dated as of January 31, 2006, between the Company and
the Lender (said Credit Agreement, as the same may be further amended, modified
or restated from time to time, being referred to herein as the “Credit
Agreement”), and the Company hereby promises to pay interest at the office
specified above on the Term Loan evidenced hereby at the rates and at the times
and in the manner specified therefor in the Credit Agreement.

This Note is issued by the Company under the terms and provisions of the Credit
Agreement, and this Note and the holder hereof are entitled to all of the
benefits provided for thereby or referred to therein, to which reference is
hereby made for a statement thereof. This Note may be declared to be, or be and
become, due prior to its expressed maturity and voluntary prepayments may be
made hereon, all in the events, on the terms and with the effects provided in
the Credit Agreement. All capitalized terms used herein without definition shall
have the same meanings herein as such terms are defined in the Credit Agreement.

The Company hereby promises to pay all costs and expenses (including attorneys’
fees) suffered or incurred by the holder hereof in collecting this Note or
enforcing any rights in any collateral therefor. The Company hereby waives
presentment for payment and demand. THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE
WITH, AND GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD
TO PRINCIPLES OF CONFLICT OF LAW.

MAF BANCORP, INC.       By  

 

 

 

 

,

 

 

  (Print or Type Name)     (Title)

--------------------------------------------------------------------------------

EXHIBIT C

COMPLIANCE CERTIFICATE

 

To:

 

Harris N.A.

 

Chicago, Illinois

This Compliance Certificate is furnished to Harris N.A. pursuant to that certain
Credit Agreement dated as of January 31, 2006, between MAF Bancorp, Inc. and you
(the “Credit Agreement”). Unless otherwise defined herein, the terms used in
this Compliance Certificate have the meanings ascribed thereto in the Credit
Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am the duly elected                                               of the
Company;

2. In my corporate capacity, I have reviewed the terms of the Credit Agreement
and I have made, or have caused to be made under my supervision, a detailed
review of the transactions and conditions of the Company and its Subsidiaries
during the accounting period covered by the attached financial statements;

3. The examinations described in paragraph 2 did not disclose, and I have no
knowledge of, the existence of any condition or the occurrence of any event
which constitutes a Default or Event of Default during or at the end of the
accounting period covered by the attached financial statements or as of the date
of this Certificate, except as set forth below;

4. The financial statements required by Section 7.5 of the Credit Agreement and
being furnished to you concurrently with this Certificate are true, correct and
complete as of the date and for the periods covered thereby; and

5. The Attachment hereto sets forth financial data and computations evidencing
the Company’s compliance with certain covenants of the Credit Agreement, all of
which data and computations are, to the best of my knowledge, true, complete and
correct and have been made in accordance with the relevant Sections of the
Credit Agreement.

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking, or proposes to
take with respect to each such condition or event:

______________________________________________________________________________________________________

______________________________________________________________________________________________________

______________________________________________________________________________________________________

______________________________________________________________________________________________________

--------------------------------------------------------------------------------

The foregoing certifications, together with the computations set forth in the
Attachment hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this          day of
                     20    .

 

By  

 

 

 

 

,

 

 

  (Print or Type Name)     (Title)

 

-2-

--------------------------------------------------------------------------------

ATTACHMENT TO COMPLIANCE CERTIFICATE

MAF BANCORP, INC.

Compliance Calculations for Credit Agreement

Dated as of January 31, 2006

Calculations as of                     , 20    

 

A.

   Ratio of Non-Performing Assets to Stockholders’ Equity/Core Capital and Loan
Loss Reserves (Section 7.7)   

1.

  

Non-Performing Assets for Company

           

a.

  

Loans more than 90 days past due

   $                                         

b.

  

Loans placed on non-accrual basis

   $                              

c.

  

Loans restructured

   $                              

d.

  

Assets acquired by repossession or foreclosure

   $                              

Sum of Lines 1a-1d

   $                           

2.

  

Stockholders’ equity and loan loss reserves

           

a.

  

Stockholders’ equity of Company

   $                              

b.

  

Loan loss reserves of Company

   $                              

Sum of Lines 2a-2b

   $                           

3.

  

Ratio of Line 1 to Line 2

              :           

4.

  

Non-Performing Assets for each Banking Subsidiary

           

a.

  

Loans more than 90 days past due

   $                              

b.

  

Loans placed on non-accrual basis

   $                              

c.

  

Loans restructured

   $                              

d.

  

Assets acquired by repossession or foreclosure

   $                              

Sum of Lines 4a-4d

   $                        

--------------------------------------------------------------------------------

     5.    Core capital and loan loss reserves                 (a)    Core
capital of Banking Subsidiary    $                                          (b)
   Loan loss reserves of Banking Subsidiary    $                              
   Sum of Lines 5a-5b    $                            6.    Ratio of Line 4 to
Line 5                 :            7.    Line 4 and Line 6 ratios each must be
not more than         .20:1.0    8.    Company is in compliance?            
(Circle Yes or No)         Yes/No

B.

   Adjusted Net Worth (Section 7.9)    1.    Total stockholders’ equity of the
Company (determined without regard to FASB 115 adjustments)       $           
             2.    Sum of             (i)    investments in, and loans and
advances to, MAF Developments    $                               (ii)   
goodwill relating to, and other intangible assets of, of Mid America    $     
                                  $                         3.    Line 1 minus
Line 2       $                         4.    Line 3 must be greater than or
equal to       $ 500,000,000    5.    Company is in compliance?            
(Circle Yes or No)         Yes/No

C.

   Adjusted Net Income (Section 7.10)    1.    Net income of the Company, before
extraordinary items       $                         2.    Line 1 must be greater
than       $  85,000,000    3.   

Company is in compliance?

(Circle Yes or No)

        Yes/No

 

-2-

--------------------------------------------------------------------------------

EXHIBIT D

OPINION OF COUNSEL

January 31, 2006

Harris N.A.

111 West Monroe Street

Chicago, Illinois 60603

 

  Re: Credit Agreement

Ladies and Gentlemen:

I am General Counsel to MAF Bancorp, Inc., a Delaware corporation (the
“Company”). This Opinion Letter is furnished to you pursuant to Section 6.2(c)
of that certain Credit Agreement dated as of January 31, 2006 by and between the
Company and Harris N.A. (the “Bank”), a national banking association (referred
to herein as the “Transaction”).

This Opinion Letter is governed by, and shall be interpreted in accordance with,
the Legal Opinion Accord (the “Accord”) of the ABA Section of Business Law
(1991). As a consequence, it is subject to a number of qualifications,
exceptions, definitions, limitations on coverage and other limitations, all as
more particularly described in the Accord, including but not limited to, the
assumptions contained in §4 of the Accord and the General Qualifications (as
defined in the Accord), and this Opinion Letter should be read in conjunction
therewith. The law covered by the opinions expressed herein is limited to the
Federal Law of the United States and the Law of the State of Illinois. Unless
otherwise defined herein, capitalized terms used herein shall have the meanings
assigned to them in the Accord.

Based upon the foregoing and subject to the qualifications, assumptions and
limitations set forth herein, I am of the opinion that:

1. The Company is a corporation validly existing and in good standing under the
laws of the State of Delaware and is a registered savings and loan holding
company under the Home Owners’ Loan Act, as amended.

2. The Company has adequate corporate power and authority to conduct its
business as it is now being conducted.

3. The execution and delivery by the Company of the documents set forth on
Exhibit A hereto (collectively, the “Transaction Documents”) and the performance
by the Company of its agreements under such documents have been duly authorized
by all requisite corporate action on the part of the Company.

--------------------------------------------------------------------------------

Harris N.A.

January 31, 2006

Page 2

4. The Transaction Documents have been duly executed by the Company and are
enforceable against the Company in accordance with their respective terms.

5. No approval, consent or authorization of, or filing with, any governmental
agency or authority of the United States of America or the State of Illinois, is
required on the part of the Company to make valid and legally binding the
execution, delivery and performance by the Company of the Transaction Documents,
except for approvals, consents, authorizations and filings already obtained or
made.

6. The execution and delivery by the Company of the Transaction Documents, and
the performance by the Company of its agreements under such documents, do not
(a) violate the Company’s Constituent Documents, (b) assuming the proper pay-off
and termination of the prior Credit Agreement dated as of November 30, 2001, as
amended from time to time, result in a breach of, constitute a default under, or
result in the creation of any lien, security interest or other encumbrance upon
any of the Company’s properties under, any material agreement or instrument
Actually Known to me to which the Company is a party or by which any of its
properties is bound, (c) breach or otherwise violate any existing obligation of
the Company under any material decree or order of the United States of America
or the State of Illinois Actually Known to me to which the Company is a party or
in which it is named, or (d) violate applicable provisions of statutory law or
regulation.

7. The Company is not an “investment company” or an “affiliated person” of or
“promoter” or “principal underwriter” for, an “investment company”, as such
terms are defined in the Investment Company Act of 1940, as amended. The
execution of the Term Note (as defined in the Credit Agreement), the application
of the proceeds thereof by the Company as provided in the Credit Agreement, and
the consummation of the transactions contemplated by the Credit Agreement will
not result in any violation by the Company of any provision of such Act or any
rule, regulation or order issued by the Securities and Exchange Commission
thereunder.

8. Assuming that the Company applies the proceeds of the Loans (as defined in
the Credit Agreement) as provided in the Credit Agreement, the Loans will not
violate the provisions of Regulations U and X of the Federal Reserve Board.

The General Qualifications, the Bankruptcy and Insolvency Exception, the
Equitable Principles Limitations and the Other Common Qualifications apply to
the opinion set forth in paragraph 4.

 

-2-

--------------------------------------------------------------------------------

Harris N.A.

January 31, 2006

Page 3

This Opinion Letter may be relied upon by you only in connection with the
Transaction and may not be used or relied upon by you or any other person for
any purpose whatsoever, except to the extent authorized in the Accord, without
in each instance our prior written consent.

 

Very truly yours,

Jennifer R. Evans, Esq.

Senior Vice President and General Counsel

 

-3-

--------------------------------------------------------------------------------

EXHIBIT A

TRANSACTION DOCUMENTS

(a) Credit Agreement dated as of January 31, 2006, between the Company and
Harris N.A. (“Credit Agreement”).

(b) Revolving Credit Note dated as of January 31, 2006, of the Company payable
to the order of the Bank in the principal sum of $60,000,000.

(c) Term Note dated as of January 31, 2006, of the Company payable to the order
of the Bank in the principal sum of $115,000,000.

--------------------------------------------------------------------------------

SCHEDULE 5.2

SIGNIFICANT SUBSIDIARIES

 

NAME

   JURISDICTION OF
INCORPORATION    PERCENTAGE
OWNERSHIP

Mid America Bank, fsb

   United States    100%

MAF Developments, Inc.

   Illinois    100%

--------------------------------------------------------------------------------

SCHEDULE 7.11

1. LaSalle Bank has issued a $250,000 letter of credit on behalf of Mid America
Re, Inc. for the benefit of the State of Vermont relating to the state’s capital
requirements for captive mortgage reinsurance companies.

2. Mid America Investment Services, Inc. (“MAIS”) has recorded on its books as
of November 30, 2005, an amount of $6,075,925 classified as A/P-Other. This
relates to a property MAIS sold in 2000 (which had previously been REO of the
Bank and had been contributed to MAIS), under an agreement in which the buyer
assumed an industrial revenue bond obligation in the amount of $6,000,000. Mid
America has issued a letter of credit guaranteeing the repayment of the IRB
obligation and this letter of credit remains outstanding. Because Mid America
provided an additional loan to the buyers for tenant improvements and remains
contingently liable relative to the IRB obligation (pursuant to the letter of
credit), for GAAP purposes, MAIS could not record this transaction as a sale.
MAIS was required to keep the liability (including the deferred profit on the
sale of approximately $83,000) on its books as well as the asset relating to the
property of $6,000,000 (recorded as A/R-Other).