EXHIBIT 10.14

 

REVOLVING CREDIT AGREEMENT

 

This REVOLVING CREDIT AGREEMENT is made and entered into as of November 19,
2008, by and among LANDMARK BANCORP, INC., a Delaware corporation (the
“Borrower”) and FIRST NATIONAL BANK OF OMAHA, a national banking association
with principal offices in Omaha, Nebraska (the “Bank”).

 

WHEREAS, the Borrower has requested that the Bank provide a revolving credit
facility in the aggregate amount not to exceed Nine Million and No/100ths
Dollars ($9,000,000.00) for the purposes described herein; and

 

WHEREAS, the Bank is willing to provide such revolving credit facility to the
Borrower upon, and subject to, the terms, provisions and conditions herein set
forth.

 

NOW, THEREFORE, in consideration of the foregoing recitals and the promises
herein made, and in reliance upon the representations, warranties and covenants
herein contained, and intending to be legally bound hereby, the parties hereby
agree as follows:

 

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

 

Section 1.01.  Defined Terms.  As used in this Agreement, the following terms
have the following meanings (terms defined in the singular to have the same
meaning when used in the plural and vice versa):

 

“Affiliate” means any Person, other than a Subsidiary, (a) which directly or
indirectly controls, or is controlled by, or is under common control with the
Borrower or a Subsidiary; (b) which directly or indirectly beneficially owns or
holds ten percent (10%) or more of any interest of the Borrower or any
Subsidiary; (c) ten percent (10%) or more of the voting stock of which is
directly or indirectly beneficially owned or held by the Borrower or a
Subsidiary; or (d) ten percent (10%) or more of any membership interest or other
interest in any other entity of which is directly or indirectly beneficially
owned or held by the Borrower or a Subsidiary. The term “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, through the ownership of interests in a limited
liability company, partnership or other entity, by contract, or otherwise.

 

“Agreement” means this Revolving Credit Agreement and all schedules and exhibits
to this Agreement, in each case as amended, supplemented, or modified from time
to time.

 

“Applicable Law” means any applicable federal, state, local statute, rule,
regulation, ordinance, order, directive, code or such other requirements.

 

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“Assets” means anything owned or controlled by the referenced entity or any
right or interest of the referenced entity therein.

 

“Authorized Person” means, an individual authorized to act on behalf of the
Borrower or Landmark National Bank, in accordance with its Organizational
Documents or appropriate resolutions adopted in accordance therewith.

 

“Bank” shall have the meaning given such term in the preamble hereto.

 

“Bank Regulatory Authority” means the Board, the Comptroller of the Currency,
the Federal Deposit Insurance Corporation and all other relevant regulatory
authorities (including, without limitation, any relevant state bank regulatory
authorities).

 

“Bank Stock” means all of the outstanding shares of stock of Landmark National
Bank.

 

“Bank Subsidiary” means Landmark National Bank and any other Subsidiary of the
Borrower that is a federal or state bank, savings and loan, or thrift
institution, under Applicable Law.

 

“Bankruptcy Code” means Title 11 of the United States Code, as now constituted
or hereafter amended.

 

“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

 

“Borrower” shall have the meaning given such term in the preamble hereto.

 

“Business Day” means any day other than a Saturday, Sunday, or other day on
which the Bank is authorized or required to close under the laws of the State of
Nebraska or the United States.

 

“Call Report” means, with respect to the Borrower, its FR Y-9C (consolidated)
and FR Y-9LP (unconsolidated) quarterly reports to the Federal Reserve System,
and, with respect to Landmark National Bank, its “Consolidated Reports of
Condition and Income” (or similar reports) filed with its applicable Bank
Regulatory Authority, or such other forms of call reports as may be required by
the Bank Regulatory Authority from time to time; provided, however, if at any
time such reports are not required by the applicable Bank Regulatory
Authorities, then “Call Reports” shall mean reports containing information
similar to the reports set forth above or such other reports as the parties
hereto agree upon.

 

“Capital Leases” means all leases which have been or should be capitalized on
the books of the lessee in accordance with GAAP.

 

“Change in Control” shall be deemed to have occurred if at any time (a) any
Person or group of Persons not an owner of an Equity Interest of Borrower on the
Effective Date shall have acquired beneficial ownership of Equity Interests
representing fifty percent (50%) or more in voting power of the outstanding
voting interests in the Borrower, (b) a majority of the Board of Directors of
the

 

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Borrower shall at any time not consist of (i) individuals who shall have been
members of the Board of Directors of the Borrower on the Effective Date and
(ii) individuals whose nomination or election to such Board of Directors shall
have been recommended or approved by a vote of a majority of the members of such
Board of Directors described in the preceding clause (i) or in this clause (ii),
or (c) the Borrower shall cease to, directly or indirectly, own and control one
hundred percent (100%) of the Equity Interests of Landmark National Bank or the
sale by Landmark National Bank, of substantially all of its Assets.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the regulations and published interpretations thereunder.

 

“Collateral” means all property which is subject or is to be subject to the Lien
granted by the Pledge Agreement.

 

“Commitment” shall have the meaning ascribed thereto in Section 2.01.

 

“Commonly Controlled Entity” means an entity, whether or not incorporated, which
is under common control with the Borrower within the meaning of
Section 414(b) or 414(c) of the Code.

 

“Conditions Precedent” shall have the meaning ascribed thereto in Section 3.01.

 

“Debt” means (a) indebtedness or liability for borrowed money; (b) obligations
evidenced by bonds, debentures, notes, or other similar instruments;
(c) obligations for the payment of deferred purchase price of property or
services (including trade obligations); (d) obligations as lessee under Capital
Leases; (e) current liabilities in respect of unfunded vested benefits under
Plans covered by ERISA; (f) obligations under letters of credit; (g) obligations
under acceptance facilities; and (h) all guaranties, endorsements (other than
for collection or deposit in the ordinary course of business), and other
contingent obligations to purchase, to provide funds for payment, to supply
funds to invest in any Person or entity, or otherwise to assure a creditor
against loss.

 

 “Default” means any of the events specified in Section 8.01 of this Agreement,
whether or not any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.

 

“Effective Date” means the date of this Agreement.

 

“Environmental Permits” shall have the meaning ascribed to such term in
Section 4.15 of this Agreement.

 

“Environmental Requirements” means all federal, state, local, and foreign
statutes, regulations, and ordinances concerning pollution or protection of the
environment, health and safety, including, but not limited to, all those
relating to the presence, use, production, generation, handling, transportation,
treatment, storage, disposal, distribution, labeling, testing, processing,
discharge, release, threatened release, control, or cleanup of any hazardous
materials, substances, or wastes, as such requirements are enacted and in effect
on or prior to the Effective Date.

 

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“Equity Interests” means, with respect to any Person, all of the units or
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of units or shares of capital stock of (or other ownership or profit
interests in) such Person, all of the securities convertible into or
exchangeable for units or shares of capital stock of (or other ownership or
profit interests in) such Person or warrants, rights or options for the purchase
or acquisition from such Person of such units or shares (or such other
interests), and all of the other ownership or profit interests in such Person
(including partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such units or shares, warrants, options, rights or
other interests are outstanding on any date of determination, in each such case
including all voting rights and economic rights related thereto.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations and published interpretations thereof.

 

“Event of Default” means any of the events specified in Section 8.01 of this
Agreement, provided that any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied.

 

“GAAP” means generally accepted accounting principles in the United States.

 

“Governmental Authority” shall mean any federal, state, county, or local
governmental department, commission, board, bureau, agency, authority,
instrumentality or judicial or regulatory body or entity having or asserting
jurisdiction over the Borrower or any Subsidiary.

 

“Knowledge” means, as to any representation or warranty of the Borrower, to the
knowledge of any of the executive officers of the Borrower and/or Landmark
National Bank, after due inquiry.

 

“Landmark National Bank” means Landmark National Bank, a national banking
association.

 

“Lien” means any mortgage, deed of trust, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), or preference, priority, or other security agreement or preferential
arrangement, charge, or encumbrance of any kind or nature whatsoever (including,
without limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement under the UCC or comparable
law of any jurisdiction to evidence any of the foregoing).

 

“Loans” shall have the meaning ascribed thereto in Section 2.01.

 

“Loan Documents” means, collectively, this Agreement, the Revolving Note, the
Pledge Agreement (including the Stock Transfer Power and Assignment delivered in
connection therewith), and any other instruments, filings or documents delivered
in connection with the foregoing or otherwise relating to the Loans.

 

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“Loan Loss Reserves” means as of the date of determination the amount
denominated as the “loan loss reserve” or the “allowance for loan and lease
losses” in the Call Report of such Person.

 

“Loan Termination Date” means the earliest to occur of the following:
(a) November       , 2009, (b) the date the Obligations are accelerated pursuant
to this Agreement or the Revolving Note and (c) the date the Bank has received
(i) notice in writing from the Borrower of the Borrower’s election to terminate
this Agreement or the Revolving Note or (ii) indefeasible payment in full of the
Obligations.

 

“Material Adverse Effect” means any change in, or effect on, or series of
related changes in, or related effects on, the business of the Borrower,
Landmark National Bank, or any Subsidiary, as commonly conducted by each of
them, that would have a material and adverse effect on (a) the condition
(financial or otherwise), of the Assets, liabilities, business, prospects or
operations of the Borrower and its Subsidiaries (b) the ability of the Borrower
or any Subsidiary to perform its obligations under the Loan Documents to which
it is a party, or (c) the rights or benefits available to the Bank relating to
the Collateral, provided that none of the following shall alone, and not in
conjunction with one another or other factors, be deemed to constitute a
Material Adverse Effect: any adverse change, event, development, or effect
arising from or relating to (i) changes in United States generally accepted
accounting principles, (ii) changes in laws, rules, regulations, orders, or
other binding directives issued by any Governmental Authority or (iii) the
taking by the Borrower of any action required by this Agreement and the other
agreements contemplated hereby.

 

“Maximum Rate” shall have the meaning ascribed thereto in Section 9.06.

 

“Non-Performing Assets” means with respect to a Person, the sum of
(a) Non-Performing Loans, (b) leases and other Assets for which payments or
other obligations are past due or in default by ninety (90) days or more,
(c) the total of all non-accrual leases and other Assets, and (d) all other
Assets acquired by such Person through foreclosure or other realization upon
collateral or rearrangement or satisfaction of Debt.

 

“Non-Performing Loans” means, as of any date of determination, the sum of:

 

(a)           loans classified as non-accrual (regardless of whether such
classification is internal or as reported to or directed by a Bank Regulatory
Authority); plus

 

(b)           loans past due by ninety (90) or more days that are still accruing
interest; plus

 

(c)           loans for which the obligee has reduced the agreed interest rate,
reduced the principal or interest obligation, applied interest payments to
reduce principal, capitalized interest or otherwise renegotiated the terms of
the obligation based upon the actual or asserted inability of the obligor or
obligors of such loans to perform their

 

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obligations pursuant to the agreements with the obligee prior to such
modification or renegotiation.

 

“Obligation” or “Obligations” shall mean, collectively, (a) each of the
obligations and covenants of Borrower under this Agreement, the Pledge
Agreement, the Revolving Note, and any of the other Loan Documents, together
with all modifications, substitutions, extensions and renewals of each, whether
absolute or contingent, liquidated or unliquidated, existing now or arising in
the future and (b) all present and future indebtedness and obligations of
Borrower or any of its Subsidiaries to the Bank whether direct, indirect,
absolute, or contingent and whether arising by note, guaranty, overdraft, or
otherwise.

 

“Organizational Documents” means (a) with respect to a limited liability
company, the articles of organization and operating agreement, (b) with respect
to a corporation, the articles of incorporation and bylaws, and (c) with respect
to a national bank, any of its formation or organizational documents including
but not limited to any articles of association and bylaws.

 

“Permitted Liens” means (a) Liens for taxes or assessments or other government
charges or levies not yet due and payable, or, if due and payable, being
contested in good faith, by appropriate proceedings for which appropriate
reserves are maintained; (b) statutory liens of landlords, liens of carriers,
warehousemen, mechanics and materialmen incurred in the ordinary course of
business for sums not yet due and payable, or, if due and payable, being
contested in good faith, by appropriate proceedings for which appropriate
reserves are maintained; (c) Liens incurred or deposits made in the ordinary
course of business in connection with workers’ compensation, unemployment
insurance and social security; (d) zoning, building codes, and other land use
laws regulating the use or occupancy of real property or the activities
conducted thereon; and (e) easements, covenants, conditions, restrictions, and
other similar matters affecting title to real property.

 

 “Person” means an individual, partnership, limited liability company,
corporation, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority, or other entity of whatever
nature.

 

“Plan” means any pension plan which is covered by Title IV of ERISA and in
respect of which the Borrower or a Commonly Controlled Entity is an “employer”
as defined in Section 3(5) of ERISA.

 

“Plan Requirements” means all federal, state, local, and foreign statutes,
regulations, and ordinances concerning any Plan.

 

“Pledge Agreement” means the Pledge Agreement executed by Borrower, dated the
Effective Date, whereby Borrower pledges one hundred percent (100%) of the
issued and outstanding shares of Bank Stock and any other shares of Bank Stock
acquired by Borrower to the Bank to secure the Obligations, in the form attached
hereto as Exhibit “A” and incorporated herein by this reference; as the same may
be amended, executed and delivered to the Bank from time to time to

 

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reflect any acquisition of an Equity Interest in a Bank Subsidiary by Borrower
following the Effective Date.

 

“Premises” shall have the meaning ascribed to such term in Section 4.15.

 

“Prime Rate” means a floating rate equal to the rate published as the “prime
rate” from time to time in the Money Rates Section of The Wall Street Journal
(or, if The Wall Street Journal ceases publishing a prime rate, the rate
established by the Bank in its sole discretion from time to time as the Prime
Rate).

 

“Principal Office” means the Bank’s office at 1620 Dodge Street, Omaha, Nebraska
68102.

 

“Revolving Note” shall have the meaning ascribed thereto in Section 2.04.

 

“ROA” means the return on assets expressed as a percentage and determined by
dividing Landmark National Bank’s pre-tax net income less extraordinary and/or
non-recurring items (as determined in accordance with GAAP) for such fiscal year
by the total assets of Landmark National Bank as of the last day of such fiscal
year, as reported in the most recent Call Report.

 

“Subsidiary” means, as to the Borrower, (a) a corporation of which shares of
stock having ordinary voting power (other than stock having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by the Borrower; or (b) a limited liability
company of which the Borrower owns a greater than fifty percent (50%) membership
interest, has the ability to elect the majority of the managers of the limited
liability company, or the management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or both, by the Borrower; or
(c) any partnership or other entity of which the Borrower owns a greater than
fifty percent (50%) interest or the management of which is controlled, directly
or indirectly through one or more intermediaries, or both, by the Borrower; or
(d) any Bank Subsidiary.  Subsidiary as to the Borrower shall include Landmark
National Bank or any other Subsidiary that is permitted to be formed in
accordance with the terms of this Agreement.

 

“Tier 1 Capital” means, at any time, for any Person on any date, the amount, for
such Person on such date, of its consolidated “Tier 1 capital” within the
meaning given to such term in the applicable regulations or other Applicable Law
of any Governmental Authority having authority as such regulations are
applicable to such Person.

 

“Tier 1 Risk Based Capital Ratio” shall mean Tier 1 Risk Based Capital Ratio as
currently defined in the Call Reports.

 

“Total Capital” means, at any time, for any Person on any date, the amount, for
such Person on such date, of its consolidated “total capital” within the meaning
given to such term in the

 

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applicable regulations or other Applicable Law of any Governmental Authority
having authority as such regulations are applicable to such Person.

 

“UCC” means the Uniform Commercial Code of the State of Nebraska, as amended
from time to time.

 

Section 1.02.  Accounting Terms and Regulatory Terms.  All accounting terms not
specifically defined herein shall be construed in accordance with GAAP
consistent with those applied in the preparation of the financial statements of
the Borrower pursuant to the terms and provisions hereof, and all financial data
submitted pursuant to this Agreement shall be prepared in accordance with such
principles.  All regulatory terms not specifically defined herein shall be
construed in accordance with the rules and regulations of any applicable
Governmental Authority.

 

ARTICLE II

 

AMOUNT AND TERMS OF THE LOANS

 

Section 2.01.  Revolving Credit.  The Bank agrees on the terms and conditions
hereinafter set forth, to make loans (the “Loans”) to the Borrower from time to
time during the period from the Effective Date of this Agreement up to, but not
including, the Loan Termination Date in an aggregate principal amount not to
exceed at any time outstanding Nine Million and No/100ths Dollars
($9,000,000.00) (the “Commitment”) upon delivery by the Borrower to the Bank of
a telephonic or written borrowing request relating thereto in a form reasonably
acceptable to the Bank pursuant to the terms and provisions of this Agreement. 
Within the limits of the Commitment, the Borrower may borrow, prepay and
reborrow under this Section 2.01.  The Bank’s obligation to make Loans hereunder
shall be subject to the Borrower’s satisfaction of the Conditions Precedent.  It
is the intention of the parties that the outstanding balance of the Revolving
Note shall not exceed the Commitment, and if at any time said balance exceeds
the Commitment, the Borrower shall forthwith pay the Bank sufficient funds to
reduce the balance of the Revolving Note until it is in compliance with this
requirement.  The Borrower may elect to terminate the Revolving Note at any
time, without penalty, upon written notice to the Bank.  In the event the
Borrower so elects to terminate the Revolving Note, the aggregate principal
amount of the Revolving Note outstanding, together with any accrued and unpaid
interest thereon, as well as any other amounts due the Bank pursuant to any of
the other Loan Documents, shall be due and payable to the Bank on the date of
such election, if not sooner paid and the Revolving Note shall be deemed for all
purposes terminated and the Bank shall have no further or additional obligation
to loan funds to the Borrower pursuant to the terms and provisions of this
Agreement.

 

Section 2.02.  Notice and Manner of Borrowing.  Upon receipt by the Bank from
the Borrower of a telephonic or written borrowing request (which notice shall be
irrevocable once given), in a form reasonably acceptable to the Bank, for a Loan
not later than 2:00 P.M. (Central Time) on the date Borrower is requesting such
Loan (which must be a Business Day), provided Borrower has fulfilled or complied
with the applicable Conditions Precedent, the Bank will make

 

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such Loan available to the Borrower in immediately available funds by crediting
the amount thereof to the Borrower’s deposit account with the Bank.

 

Section 2.03.  Interest.  The Borrower shall pay interest to the Bank on the
outstanding and unpaid principal amount of the Loans made hereunder at a rate
per annum equal to the Prime Rate, adjusted on a daily basis, minus twenty five
(25) basis points, prior to acceleration or maturity.  Interest shall be
calculated on the basis of a year of three hundred sixty (360) days for the
actual number of days elapsed.  All accrued and unpaid interest relating to the
activity for the preceding calendar quarter shall be paid in immediately
available funds on the first day of each calendar quarter (commencing January 1,
2009 and on every January 1, April 1, July 1, and October 1, thereafter).  All
payments of principal and interest made hereunder, whether during the term
hereof or upon the stated maturity of the Loans, shall be made at the Principal
Office.  Following and during the continuation of an Event of Default, any
principal amount and accrued, but unpaid interest shall bear interest at a rate
per annum equal at all times to the Prime Rate, in effect from time to time,
plus six hundred (600) basis points.

 

Section 2.04.  Note.  All Loans made by the Bank under this Agreement shall be
evidenced by, and repaid with interest in accordance with, the Revolving Note in
the form attached hereto as Exhibit “B” and incorporated herein by this
reference (the “Revolving Note”). The Borrower hereby authorizes the Bank to
maintain an electronic ledger of all disbursements to the Borrower under the
Revolving Note and this Agreement and any payments of the principal amount under
the Revolving Note, accrued but unpaid interest, and other charges due under the
Revolving Note or this Agreement, which notations on such electronic ledger
shall, in the absence of manifest error or mutual agreement among the parties,
be conclusive; provided, however, that the failure to make any such notation
shall not limit or otherwise affect the obligations of the Borrower under the
Revolving Note or this Agreement.

 

Section 2.05.  Method of Payment.  The Borrower shall make each payment under
this Agreement and under the Revolving Note not later than 2:00 P.M. (Central
Time) on the date when due in lawful money of the United States to the Bank at
its Principal Office in immediately available funds.  The Borrower hereby
authorizes the Bank, if and to the extent Bank receives a telephonic request
from an officer or Authorized Person to take such action, to charge from time to
time against any account of the Borrower with the Bank any amount requested. 
Whenever any payment to be made under this Agreement or under the Revolving Note
shall be stated to be due on a day other than a Business Day, such payment shall
be made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of the payment of interest.

 

Section 2.06.  Reimbursement of the Bank or Payment by Borrower.  The Borrower
shall pay all costs associated with the negotiation and preparation of the Loan
Documents and transactions contemplated by this Agreement that are incurred
prior to, on or immediately following the Effective Date, including, but not
limited to, the out-of-pocket costs associated with the Bank’s due diligence,
and such other reasonable out-of-pocket costs and expenses incurred by the Bank
relating to the transactions described in this Agreement, provided, however,

 

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the Borrower shall not be obligated to pay or reimburse the Bank for the Bank’s
legal fees associated with the negotiation and preparation of the Loan
Documents.

 

Section 2.07.  Use of Proceeds.  The proceeds of the Loans hereunder shall be
used by the Borrower to (i) repay the outstanding principal and accrued interest
balances due the Bank with respect to that certain operating line of credit in
the amount of Nine Million and No/100ths Dollars ($9,000,000.00) evidenced by
the Loan Agreement dated as of April 1, 2004 by and between the Borrower and the
Bank, and the Documents, as such term is defined therein, (ii) finance the
operational needs of Borrower and the Subsidiaries and (iii) otherwise for
working capital and general company or corporate purposes of the Borrower and
the Subsidiaries.  Borrower will not, directly or indirectly, use any part of
such proceeds for any other purpose or purposes, including the purpose of
purchasing or carrying any margin stock within the meaning of Regulation U of
the Board or to extend credit to any Person for the purpose of purchasing or
carrying any such margin stock, or for any purpose which violates, or is
inconsistent with, Regulation X of the Board.

 

ARTICLE III

 

CONDITIONS PRECEDENT

 

Section 3.01.  Condition Precedent to Loans.  The obligation of the Bank to make
any advances hereunder (the initial advance as well as any subsequent advances)
to the Borrower pursuant to the Commitment is subject to the following
conditions precedent (collectively, the “Conditions Precedent”):

 

(a)           Closing Documents to be Provided.  That the Bank shall have
received, or waived in writing the obligation to receive, on or before the
Effective Date each of the following, in form and substance satisfactory to the
Bank and its counsel:

 

(1)   This Agreement duly executed on behalf of the Borrower;

 

(2)   The Revolving Note duly executed by the Borrower;

 

(3)   The Pledge Agreement duly executed on behalf of Borrower; together with
(i) a Stock Transfer Power and Assignment duly executed in blank for the benefit
of the Bank, to which is attached the original of each stock certificate
evidencing the Bank Stock; (ii) acknowledgment copies of the financing
statements duly filed under the Uniform Commercial Code of all jurisdictions
necessary or, in the opinion of the Bank, desirable to perfect the security
interest created by the Pledge Agreement; and (iii) certified copies of Requests
for Copies or Information (Form UCC-11) identifying all of the financing
statements on file with respect to the Borrower in all jurisdictions referred to
under (ii), including the financing statements filed by the Bank against the
Borrower, indicating that no Person or entity claims an interest in any of the
Collateral, except for the Bank;

 

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(4)   Certified (as of the Effective Date) copies of the resolutions of the
respective Boards of Directors, authorizing the execution, delivery, and
performance of the Loan Documents to which it is a party and each other document
to be delivered pursuant to this Agreement;

 

(5)   A certificate (dated as of the Effective Date) of the Secretary, or such
other officer (acceptable to the Bank), as the case may be, of the Borrower and
of Landmark National Bank certifying the names and true signatures of the
Authorized Person(s) of the Borrower and of Landmark National Bank respectively,
authorized to sign the Loan Documents to which it is a party and the other
documents to be delivered by the Borrower and Landmark National Bank under this
Agreement;

 

(6)   Certificate (dated as of the date of this Agreement) of an Authorized
Person of the Borrower certifying a copy of the Borrower’s Organizational
Documents, and any amendments, if applicable;

 

(7)   Certificate (dated as of the date of this Agreement) of an Authorized
Person of Landmark National Bank certifying a copy of Landmark National Bank’s
Organizational Documents, and any amendments, if applicable; and

 

(8)   A certificate of good standing for the Borrower from the Secretary of
State of Delaware.

 

(b)           Additional Conditions Precedent.

 

(1)   The following statements shall be true and the Bank shall have received a
certificate signed by an Authorized Person dated the date of such Loan, stating
that:

 

(i)  The Conditions Precedent contained in Section 3.01 of this Agreement have
been complied with by the Borrower and each Subsidiary in all respects;

 

(ii)  The representations and warranties contained in Article IV of this
Agreement and in the Pledge Agreement, are true and correct on and as of the
date of such Loan as though made on and as of such date, instead of the
Effective Date;

 

(iii)  The proceeds from the Loan shall be used solely for the purposes stated
in Section 2.07; and

 

(iv)  No Default or Event of Default has occurred and is continuing, or would
result from such Loan; and

 

(2)   The Bank shall have received such other documents as the Bank may
reasonably request.

 

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ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Bank as follows:

 

Section 4.01.  Organization, Good Standing, and Due Qualification.  The Borrower
and each Subsidiary are duly organized, validly existing, and in good standing
under the laws of their respective states or jurisdictions of formation; have
the power and authority to own their Assets and to transact the business in
which they are now engaged or proposed to be engaged in; and are duly qualified
and in good standing under the laws of each other jurisdiction in which such
qualification is required.

 

Section 4.02.  Power and Authority.  The execution, delivery, and performance by
the Borrower of each of the Loan Documents, have been duly authorized by all
necessary action and do not and will not (a) require any consent or approval
which has not previously been obtained; (b) contravene Borrower’s Organizational
Documents as amended from time to time or Landmark National Bank’s
Organizational Documents as amended from time to time; (c) violate any provision
of any law, rule, regulation (including, without limitation, Regulations U and X
of the Board), order, writ, judgment, injunction, decree, determination, or
award presently in effect having applicability to the Borrower or any
Subsidiary; (d) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other material agreement, lease, or
instrument to which the Borrower or its Subsidiary is a party or by which it or
its properties may be bound or affected; or (e) result in, or require, the
creation or imposition of any Lien, upon or with respect to any of the
properties now owned or hereafter acquired by the Borrower or any Subsidiary
(except in favor of the Bank).

 

Section 4.03.  Legally Enforceable Agreement.  This Agreement is, and each of
the other Loan Documents, when delivered under this Agreement will be, legal,
valid, and binding obligations of the Borrower, and enforceable against the
Borrower in accordance with their respective terms, except to the extent that
such enforcement may be limited by applicable bankruptcy, insolvency, and other
similar laws affecting creditors’ rights generally.

 

Section 4.04.  Provided Information.  No information, exhibit, or report
furnished by the Borrower or any Subsidiary to the Bank in connection with the
negotiation of this Agreement contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statement
contained therein not materially misleading.

 

Section 4.05.  Labor Disputes and Acts of God.  Neither the business nor the
properties of the Borrower or any Subsidiary are affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy, or other casualty
(whether or not covered by insurance) adversely affecting such business
properties or the operation of the Borrower or any Subsidiary.

 

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Section 4.06.  Other Agreements.  The Borrower is not a party to any indenture,
loan, or credit agreement, or to any lease or other agreement or instrument, or
subject to any charter or restriction which could have a Material Adverse Effect
on the business, Assets, operations, or conditions, financial or otherwise, of
the Borrower, or on the ability of the Borrower to carry out its obligations
under the Loan Documents to which it is a party.  The Borrower is not in default
in any respect in the performance, observance, or fulfillment of any of the
obligations, covenants, or conditions contained in any agreement or instrument
material to its business or to which it is a party.

 

Section 4.07.  Litigation.  There is no pending or, to Borrower’s Knowledge,
threatened action or proceeding against or affecting the Borrower or any
Subsidiaries before any court, Governmental Authority, or arbitrator which may,
in any one case or in the aggregate, have a Material Adverse Effect.

 

Section 4.08.  No Defaults on Outstanding Judgments or Orders.  Neither the
Borrower nor any Subsidiary is in default with respect to any judgment, writ,
injunction, decree, rule, or regulation of any court, arbitrator, or federal,
state, municipal, or other Governmental Authority, commission, board, bureau,
agency or instrumentality, domestic or foreign except where such default would
not have a Material Adverse Effect.

 

Section 4.09.  Ownership and Liens.  The Borrower and each Subsidiary have title
to, or valid leasehold interests in, all of the Assets, real and personal (other
than any Assets disposed of in the ordinary course of business) used in the
operation of their respective businesses, and none of the properties and Assets
owned by the Borrower or any Subsidiary and none of their leasehold interests is
subject to any Lien, except for Liens in favor of the Bank and such as may be
permitted pursuant to Section 6.01 of this Agreement.

 

Section 4.10.  Subsidiaries.  The Borrower has no Subsidiaries other than
Landmark National Bank, Landmark Capital Trust I, and Landmark Capital Trust
II.  All equity ownership interests of each Subsidiary have been validly issued,
are fully paid and nonassessable.  All of the shares of Landmark National Bank
are wholly owned by the Borrower free and clear of all Liens, except for Liens
in favor of the Bank.  All of the common shares of Landmark Capital Trust I, and
Landmark Capital Trust II are wholly owned by the Borrower free and clear of all
Liens, except for Liens in favor of the Bank.

 

Section 4.11.  ERISA.  The Borrower and each Subsidiary are in compliance in all
material respects with all Plan Requirements.

 

Section 4.12.  Operation of Business.  The Borrower and its Subsidiaries possess
all licenses, permits, franchises, patents, copyrights, trademarks, and trade
names, or rights thereto, to conduct their respective businesses as now
conducted and as presently proposed to be conducted, and neither the Borrower
nor its Subsidiaries are in violation in any respect of any valid rights of
others with respect to any of the foregoing, except where such failure(s) or
violation(s) would not, or could not reasonably be expected to, individually or
in the aggregate, have a Material Adverse Effect.

 

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Section 4.13.  Taxes.  The Borrower and each of its Subsidiaries have filed all
tax returns (federal, state, and local) required to be filed and have paid all
taxes, assessments, and governmental charges and levies thereon to be due,
including interest and penalties or have filed appropriate extensions or
contested such taxes, in each case by appropriate proceedings and with reserves
established in accordance with GAAP.

 

Section 4.14.  Debt.  Neither the Borrower nor any of its Subsidiaries have any
credit agreements, indentures, purchase agreements, guaranties, Capital Leases,
and other investments, agreements, and arrangements in effect on the Effective
Date providing for or relating to extensions of credit (including agreements and
arrangements for the issuance of letters of credit or for acceptance financing)
in respect of which the Borrower or any Subsidiary is in any manner directly or
contingently obligated, excluding (i) debt incurred in the normal course of
banking business by the Borrower from the Federal Home Loan Bank, (ii) trust
preferred debt of the Borrower or its Subsidiaries, (iii) other debt of the
Borrower to the Bank, and (iv) contingent liquidity lines of credit incurred in
the ordinary course of banking business by the Borrower from a third party
lender.

 

Section 4.15.  Environment.  The Borrower and each Subsidiary have duly complied
with, and their businesses, operations, Assets, equipment, property, leaseholds,
or other facilities are in compliance, with all material Environmental
Requirements. The Borrower and each Subsidiary have been issued and will
maintain in all material respects all required federal, state, and local
permits, licenses, certificates, and approvals relating to (a) air emissions;
(b) discharges to surface water or groundwater; (c) noise emissions; (d) solid
or liquid waste disposal; (e) the use, generation, storage, transportation, or
disposal of toxic or hazardous substances or wastes (intended hereby and
hereafter to include any and all such materials listed in any federal, state, or
local law, code or ordinance and all rules and regulations promulgated
thereunder as hazardous or potentially hazardous); or (f) other environmental,
health, or safety matters (collectively, the “Environmental Permits”).  Except
in accordance with a valid Environmental Permit, to the Borrower’s Knowledge,
there has been no emission, spill, release, or discharge into or upon (a) the
air; (b) soils; or any improvements located thereon; (c) surface water or
groundwater; or (d) the sewer, septic system or waste treatment, storage or
disposal system servicing any real property, building or other improvement owned
or leased by the Borrower or any Subsidiary (collectively, the “Premises”) of
any toxic or hazardous substances or wastes at or from the Premises; and
accordingly, to the Borrower’s Knowledge, the Premises are free of all such
toxic or hazardous substances or wastes. To the Borrower’s Knowledge, there has
been no complaint, order, directive, claim, citation, or notice in writing by
any Governmental Authority or any person or entity with respect to (a) air
emissions; (b) spills, releases or discharges to soils or improvements located
thereon, surface water, groundwater or the sewer, septic system or waste
treatment, storage or disposal systems servicing the Premises; (c) noise
emissions; (d) solid or liquid waste disposal; (e) the use, generation, storage,
transportation, or disposal of toxic or hazardous substances or waste; or
(f) other environmental, health, or safety matters against the Borrower or its
business, operations, Assets, equipment, property, leaseholds, or other
facilities.

 

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Section 4.16.  Fictitious Business Names.  Borrower does not do and has not done
business during the past five (5) years under any corporate name, trade name, or
fictitious name other than “Landmark Bancorp, Inc.”

 

Section 4.17.  Corporate Structure.  Borrower owns one hundred percent (100%) of
the issued and outstanding shares of Landmark National Bank and no other Person
has any right to acquire any Bank Stock or other Equity Interest in Landmark
National Bank.

 

Section 4.18.  Financial Statements.  The financial statements of Borrower and
each Subsidiary, provided to the Bank are complete and correct and fairly
present the financial condition of the Borrower and each Subsidiary as at such
dates and the results of the operations of the Borrower and each Subsidiary for
the periods covered by such statements, all in accordance with GAAP, and as of
the date of this Agreement there has been no Material Adverse Effect.

 

Section 4.19.  Bank Holding Company.  The Borrower has complied with all
Applicable Laws pertaining to bank holding companies, including without
limitation the Bank Holding Company Act of 1956, as amended, and there are no
conditions precedent or subsequent to its engaging in the business of being a
registered bank holding company.

 

Section 4.20.  FDIC Insurance.  The deposits of each Bank Subsidiary are insured
by the FDIC to the extent permitted by Applicable Law and no act has occurred
which would adversely affect the status of any Bank Subsidiary as an FDIC
insured bank.

 

Section 4.21.  Director Qualifying Shares.  None of the members of the board of
directors of the Borrower or any Subsidiary own shares of stock in the Borrower
or such Subsidiary held merely due to the fact that such individual is a member
of such board of directors.

 

ARTICLE V

 

BORROWER’S AFFIRMATIVE COVENANTS

 

At all times that any amounts are outstanding under the Revolving Note, this
Agreement or any of the other Loan Documents or the Bank shall have any
Commitment under this Agreement, unless the Bank shall otherwise agree in
writing, the Borrower will:

 

Section 5.01.  Maintenance of Existence.  Preserve and maintain, and cause each
of its Subsidiaries to preserve and maintain, its corporate/organizational
existence and good standing in the jurisdiction of its
incorporation/organization, and qualify and remain qualified, and cause each of
its Subsidiaries to qualify and remain qualified, as a foreign
corporation/limited liability company in each jurisdiction in which such
qualification is required, except where the failure to be qualified and in good
standing would not have a Material Adverse Effect on such Borrower or
Subsidiaries.

 

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Section 5.02.  Maintenance of Records.  Keep, and cause each of its Subsidiaries
to keep, adequate records and books of account, in which complete entries will
be made in accordance with GAAP consistently applied, reflecting all financial
transactions of the Borrower or any Subsidiaries or if required by any
Governmental Authority, adequate records and books of account, in accordance
with Applicable Law.

 

Section 5.03.  Maintenance of Assets.  Maintain, keep, and preserve, and cause
each Subsidiary to maintain, keep, and preserve, all of its Assets (tangible and
intangible) necessary or useful in the proper conduct of its business in good
working order and condition, ordinary wear and tear excepted.

 

Section 5.04.  Conduct of Business.  Continue, and cause each Subsidiary to
continue, to engage in a business of the same general type as conducted or
planned to be conducted by it on the date of this Agreement.

 

Section 5.05.  Maintenance of Insurance.  Maintain, and cause each Subsidiary to
maintain, insurance with financially sound and reputable insurance companies or
associations in such amounts and covering such risks as are usually carried by
companies engaged in the same or a similar business and similarly situated,
which insurance may provide for reasonable deductibility from coverage thereof
and shall reflect the Bank as an additional named insured or additional loss
payee thereunder.

 

Section 5.06.  Compliance With Laws.  Comply, and cause each Subsidiary to
comply, in all material respects with all Applicable Laws relating to the
operation of its business, including but not limited to all Environmental
Requirements and Plan Requirements.

 

Section 5.07.  Right of Inspection.  To the extent permitted by applicable law,
at any reasonable time and from time to time, permit the Bank or any agent or
representative thereof to examine and make copies of and abstracts from the
records and books of account of, and visit the properties of, the Borrower and
any Subsidiary, and to discuss the affairs, finances, and accounts of the
Borrower and any Subsidiary with any of their respective officers, directors,
employees and independent accountants.

 

Section 5.08.  Reporting Requirements.  Furnish or cause to be furnished to the
Bank, in a form and substance satisfactory to the Bank and at the Borrower’s
sole cost and expense:

 

(a)           Promptly upon the filing thereof with the applicable Bank
Regulatory Authority (but in no event more than forty five (45) days after the
end of each calendar quarter), a copy of the Call Report for the Borrower;

 

(b)           Promptly upon the filing thereof with the applicable Bank
Regulatory Authority (but in no event more than forty five (45) days after the
end of each calendar quarter), a copy of the Call Report for each Bank
Subsidiary of Borrower;

 

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(c)           Promptly upon the filing thereof with the Securities and Exchange
Commission (but in no event more than forty-five (45) days after the end of each
fiscal quarter), a copy of each signed Quarterly Report on Form 10-Q of the
Borrower.  Such report shall include the Borrower’s quarterly financial
statements, including but not limited to consolidated balance sheets of the
Borrower as of the end of such fiscal quarter and consolidated statements of
income and retained earnings of the Borrower for the period commencing at the
end of the previous fiscal year and ending with the end of such fiscal quarter,
all in reasonable detail and stating in comparative form the respective figures
for the corresponding date and period in the previous fiscal year and all
prepared in accordance with GAAP consistently applied and certified by the
President of the Borrower to fairly present the financial condition of the
Borrower (subject to year-end adjustments);

 

(d)           Promptly upon the filing thereof with the Securities and Exchange
Commission (but in no event more than one hundred twenty (120) days after the
end of each fiscal year), a copy of each signed Annual Report on Form 10-K of
the Borrower.  Such report shall include the Borrower’s annual financial
statements (including therein consolidated balance sheets and statements of
income, retained earnings and cash flows of the Borrower as at the end of such
fiscal year) prepared in accordance with GAAP consistently applied and audited
by KPMG (or such other independent public accountants acceptable to the Bank)
and certified by the President of the Borrower to fairly present the financial
condition of the Borrower and the Subsidiaries, together with a comparison with
the financial statements for the previous fiscal year;

 

(e)           As soon as available but in no event later than ninety (90) days
after the end of each fiscal year, a copy of the Annual Report of Bank Holding
Company (FRY-6) of the Borrower required to be filed with the Federal Reserve
Bank in the applicable Federal Reserve District;

 

(f)            As soon as available and in any event within forty-five (45) days
after the end of each fiscal quarter of Borrower (other than the fiscal quarter
ending at the end of the fiscal year) of each year during which any amount is
outstanding under the Revolving Loan or in the event the Commitment remains
effective, a Quarterly Compliance Certificate, in the form attached hereto as
Exhibit “C” and incorporated herein by this reference, as of such date
confirming compliance by the Borrower with all of the covenants, conditions, and
undertakings of the Borrower under or pursuant to this Agreement together with a
certificate of the chief financial officer of the Borrower certifying that to
the best of the chief financial officer’s Knowledge no Default or Event of
Default has occurred and is continuing or, if a Default or Event of Default has
occurred and is continuing, a statement as to the nature thereof and the action
which is proposed to be taken with respect thereto;

 

(g)           As soon as available and in any event within one hundred twenty
(120) days after the end of each fiscal year of the Borrower, an Annual
Compliance Certificate, in the form attached hereto as Exhibit “D” and
incorporated herein by this reference, as of the end of such fiscal year
confirming compliance by the Borrower with all of the covenants, conditions, and
undertakings of the Borrower under or pursuant to this Agreement together with a

 

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certificate of the chief financial officer of the Borrower certifying that to
the best of the chief financial officer’s Knowledge no Default or Event of
Default has occurred and is continuing or, if a Default or Event of Default has
occurred and is continuing, a statement as to the nature thereof and the action
which is proposed to be taken with respect thereto;

 

(h)           To the extent permitted by applicable law, promptly after the
Borrower has been served with notice thereof, notice of all actions, suits, and
proceedings before any court or Governmental Authority, affecting the Borrower
or any Subsidiary, which, if determined adversely to the Borrower or such
Subsidiary, could have a Material Adverse Effect;

 

(i)            As soon as possible and in any event within five (5) days after
Borrower becoming aware of the occurrence of each Default or Event of Default, a
written notice setting forth the details of such Default or Event of Default and
the action which is proposed to be taken by the Borrower with respect thereto;

 

 (j)           To the extent permitted by applicable law, promptly after the
sending or filing thereof, copies of all proxy statements, financial statements,
and reports which the Borrower or any Subsidiary sends to its stockholders, and
copies of all regular, periodic, and special reports, and statements which the
Borrower or any Subsidiary files with any Governmental Authority; and

 

(k)           Such other information respecting the condition or operations,
financial or otherwise, of the Borrower or any Subsidiary as the Bank may from
time to time reasonably request.

 

Section 5.09.  Lending Limits.  The Borrower shall cause each of its Bank
Subsidiaries to comply with all Applicable Laws pertaining to the making of
loans, including, without limitation, lending limit laws. In addition, for
purposes of this Agreement, it is agreed that in determining whether its Bank
Subsidiary is in compliance with lending limits, the rules set forth in 12
C.F.R. §32.5 (combining loans to separate borrowers) shall apply unless its Bank
Subsidiary is subject to more stringent rules under the laws or regulations
otherwise applicable to them.

 

Section 5.10.  Other Debt Subordinated.  Except with respect to any Lien
existing as of the Effective Date and reflected on Exhibit E attached hereto and
incorporated herein by this reference, all Debt incurred by the Borrower, or
security interests granted in the Assets of, the Borrower, other than loans
from, and security interests granted to, the Bank, will be formally subordinated
to the Loan.

 

Section 5.11.  Environment.  Be and remain, and cause each Subsidiary to be and
remain, in compliance in all respects with all Environmental Requirements;
notify the Bank immediately of any written notice of a hazardous discharge or
environmental complaint received from any Governmental Authority or any other
party; notify the Bank promptly after Borrower becoming aware of any hazardous
discharge from or affecting its Premises; immediately contain and remove the
same, in compliance with all Applicable Laws; promptly pay or bond around any
fine or penalty assessed in connection therewith; and, upon Borrower’s or Bank’s
receipt of notice or

 

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otherwise becoming aware of any noncompliance by Borrower with an Environmental
Requirement, any notice from any Governmental Authority of any noncompliance
with an Environmental Requirement, any hazardous discharge or environmental
compliant, or any condition or event that could give rise to any of the
foregoing with respect to any of Borrower’s assets, Borrower shall (i) permit
the Bank, at the Borrower’s sole cost and expense, to inspect the Premises, to
conduct tests thereon, and to inspect all books, correspondence, and records
pertaining thereto, and (ii) at the Bank’s request, and at the Borrower’s sole
cost and expense, provide a report of a qualified environmental engineer,
satisfactory in scope, form, and content to the Bank, and such other and further
assurances reasonably satisfactory to the Bank that the condition has been
corrected.

 

ARTICLE VI

 

NEGATIVE COVENANTS

 

At all times that any amounts are outstanding under the Revolving Note, this
Agreement or any of the other Loan Documents or the Bank shall have any
Commitment under this Agreement, unless the Bank shall otherwise agree in
writing, the Borrower will not or allow any Subsidiary to:

 

Section 6.01.  Liens.   Create, incur, assume, or suffer to exist, or permit
Landmark National Bank (other than in the ordinary course of its banking
business, including Liens in favor of the Federal Reserve Bank) to create,
incur, assume, or suffer to exist, any Lien upon or with respect to any of its
Assets, now owned or hereafter acquired, except (a) Liens in favor of the Bank,
(b) Liens securing Debt outstanding as of the Effective Date to the extent such
Liens are reflected on Exhibit “E,” (c) Permitted Liens, and (d) Liens securing
contingent liquidity lines of credit incurred in the ordinary course of banking
business by the Borrower from a third party lender existing as of the Effective
Date so long as such Liens do not in any way encumber, or otherwise create or
result in any Lien upon, the Collateral.

 

Section 6.02.  Debt.  Create, incur, assume, or suffer to exist, or permit any
Subsidiary (other than any Bank Subsidiary, including Landmark National Bank,
and only in the ordinary course of its banking business) to create, incur,
assume, or suffer to exist, any Debt, except (a) Debt of the Borrower under this
Agreement and the Revolving Note, (b) Debt consisting of trade payables incurred
in the ordinary course of business, (c) Debt outstanding as of the Effective
Date to the extent reflected on Exhibit “E,” and (d) contingent liquidity lines
of credit incurred in the ordinary course of banking business by the Borrower
from a third party lender existing as of the Effective Date.

 

Section 6.03.  Mergers, Etc.  (a) Wind up, liquidate or dissolve itself,
reorganize, merge or consolidate with or into, or convey, sell, assign,
transfer, lease, or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its Assets (whether now
owned or hereafter acquired) to any Person, or (b) acquire all or substantially
all of the Assets or the business of any Person, or cause or permit any
Subsidiary to do so.

 

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Section 6.04.  Formation of Additional Subsidiaries.  Form or acquire any
Subsidiary, other than Landmark National Bank, Landmark Capital Trust I and
Landmark Capital Trust II, without the Bank’s prior written consent which may
not be unreasonably withheld.

 

Section 6.05.  Sale of Assets.  Sell, lease, assign, transfer, or otherwise
dispose of, or permit any Subsidiary to sell, lease, assign, transfer, or
otherwise dispose of, any of its now owned or hereafter acquired Assets in
excess of Five Hundred Thousand Dollars ($500,000.00) in the aggregate without
the prior written consent of the Bank, which will not be unreasonably withheld
(including, without limitation, shares of stock and indebtedness of
Subsidiaries, receivables, and leasehold interests), without the Bank’s prior
written consent which may be withheld in its sole discretion, except:
(a) inventory disposed of in the ordinary course of business; and (b) the sale
or other disposition of Assets no longer used or useful in the conduct of its
business.

 

Section 6.06.  Transactions With Affiliates.  Enter into any transaction,
including, without limitation, the purchase, sale, or exchange of property or
the rendering of any service, with any Affiliate, or permit any Subsidiary to
enter into any transaction, including, without limitation, the purchase, sale,
or exchange of property or the rendering of any service, with any Affiliate,
except in the ordinary course of and pursuant to the reasonable requirements of
the Borrower’s or such Subsidiary’s business and upon fair and reasonable terms
no less favorable to the Borrower or such Subsidiary than would be obtained in a
comparable arm’s-length transaction with a Person not an Affiliate.

 

Section 6.07.  Capital Expenditures.  Make any expenditures for fixed or capital
Assets if, after giving effect thereto, the aggregate of all such expenditures
made by the Borrower and each of the Subsidiaries would exceed Two Million and
No/100ths Dollars ($2,000,000.00) during any fiscal year of Borrower, other than
capital expenditures associated with the construction of a branch bank in
Lawrence, Kansas the expenditure for which shall not exceed Four Million and
No/100ths Dollars ($4,000,000.00).

 

Section 6.08.  Issue or Sale of Stock.  Sell, or permit Landmark National Bank
to sell any common stock of Landmark National Bank.

 

ARTICLE VII

 

FINANCIAL COVENANTS

 

At all times that any amounts are outstanding under the Revolving Note, this
Agreement or any of the other Loan Documents to which the Borrower is a party,
unless the Bank shall otherwise agree in writing, the Borrower will:

 

Section 7.01.  Maintenance of Capital and Reserves.  Cause each Bank Subsidiary
to maintain, with compliance tested as of the end of each fiscal quarter of the
Borrower, unless otherwise indicated:

 

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(a)           ROA.  An ROA of no less than sixty five hundredths percent (0.65%)
(to be tested at the end of each fiscal year, only).

 

(b)           Tier 1 Risk Based Capital Ratio.  The Tier 1 Risk Based Capital
Ratio (expressed as a percentage), as stated in the most recent Call Report of
such Person, of not less than six percent (6%).

 

(c)           Non-Performing Assets to Total Capital Ratio.  The ratio
(expressed as a percentage) of Non-Performing Assets to Total Capital of less
than twenty-five percent (25%).

 

(d)           Non-Performing Assets to Total Loans Ratio.  The ratio (expressed
as a percentage) of Non-Performing Assets to the total of all loans made by such
Person of less than five percent (5%).

 

(e)           Loan Loss Reserves to Total Loans Ratio.  The ratio (expressed as
a percentage) of Loan Loss Reserves to the total of all loans made by such
Person, shall not be less than the lesser of (i) one percent (1%) to be measured
as of March 31, 2009, or (ii) the allowance amount as shall be required by
Applicable Law or Governmental Authority.

 

ARTICLE VIII

 

EVENTS OF DEFAULT

 

Section 8.01.  Events of Default.  If any of the following events shall occur:

 

(a)           The Borrower should fail to pay the principal of, or interest on,
the Revolving Note or any other fee or expense, on the date when such amount is
due and payable, and such failure is not cured within seven (7) Business Days
after written notice to Borrower of such failure;

 

(b)           Any representation or warranty made or deemed made by the Borrower
in this Agreement, the Pledge Agreement or any of the other Loan Documents, or
which is contained in any certificate, document, opinion, or financial or other
statement furnished at any time under or in connection with any Loan Document
shall prove to have been incorrect, incomplete, or misleading in any material
respect on or as of the date made or deemed made;

 

(c)           The Borrower shall fail to perform or observe any covenant or
agreement, other than an obligation referenced in Section 8.01(a) above, made by
the Borrower in this Agreement, the Pledge Agreement or any of the other Loan
Documents, and such breach is not cured within fifteen (15) Business Days after
written notice to Borrower of such breach;

 

(d)           The Borrower or any of its Subsidiaries shall (i) fail to pay any
indebtedness for borrowed money (other than the Revolving Note) of the Borrower
or such Subsidiary, as the case may be, or any interest or premium thereon, when
due (whether by scheduled maturity, required prepayment, acceleration, demand,
or otherwise); or (ii) fail to perform or observe

 

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any term, covenant, or condition on its part to be performed or observed under
any agreement or instrument relating to any such indebtedness, when required to
be performed or observed, if the effect of such failure to perform or observe is
to accelerate, or to permit the acceleration of, after the giving of notice or
passage of time, or both, the maturity of such indebtedness, unless such failure
to perform or observe shall have been waived in writing by the holder of such
indebtedness; or (iii) any such indebtedness shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof;

 

(e)           The Borrower or any of its Subsidiaries (i) shall generally not
pay, or shall be unable to pay, or shall admit in writing its inability to pay,
its Debts as such Debts become due; (ii) shall make an assignment for the
benefit of creditors, or petition or apply to any tribunal for the appointment
of a custodian, receiver, or trustee for it or a substantial part of its Assets;
(iii) shall commence any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of Debt, dissolution, or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; (iv) shall have had any
such petition or application filed or any such proceeding commenced against it
in which an order for relief is entered or an adjudication or appointment is
made, and which remains undismissed for a period of ten (10) days or more;
(v) shall consent to, approve of, or acquiesce in any such petition,
application, proceeding, or order for relief or the appointment of a custodian,
receiver, or trustee for all or any substantial part of its properties; or
(vi) shall suffer any such custodianship, receivership, or trusteeship to
continue undischarged for a period of thirty (30) days or more;

 

(f)            One or more judgments, decrees, or orders for the payment of
money in excess of Two Hundred Fifty Thousand and No/100ths Dollars
($250,000.00) in the aggregate shall be rendered against the Borrower or any of
its Subsidiaries and such judgments, decrees, or orders shall continue
unsatisfied and in effect for a period of thirty (30) consecutive days without
being vacated, discharged, satisfied, or stayed or bonded pending appeal;

 

(g)           The Pledge Agreement shall at any time after its execution and
delivery and for any reason cease (i) to create a valid and perfected first
priority security interest (subject to Liens permitted under Section 6.01 above)
in and to the property purported to be subject to such Pledge Agreement; or
(ii) to be in full force and effect or shall be declared null and void, or the
validity or enforceability thereof shall be contested by the Borrower or any
Subsidiary or the Borrower or any Subsidiary shall deny it has any further
liability or obligation under the Pledge Agreement, or the Borrower or any
Subsidiary shall fail to perform any of its obligations under the Pledge
Agreement or any of the other Loan Documents; or

 

(h)           The occurrence of a Change in Control.

 

Then, and in any such event, the Bank may, in its sole discretion, (i) declare
its Commitment to make Loans to be terminated, whereupon the same shall
forthwith terminate, and (ii) declare the Revolving Note, all interest thereon,
and all other amounts payable under this Agreement or the Revolving Note to be
forthwith due and payable, whereupon the Revolving Note, all such

 

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interest, and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest, or further notice of any kind, all of
which are hereby expressly waived by the Borrower, to the extent permitted by
Applicable Law.

 

Upon the occurrence of any Event of Default, the Bank is hereby authorized at
any time and from time to time, without written notice to the Borrower or any
Subsidiary (any such notice being expressly waived by the Borrower and each
Subsidiary), to set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at any
time owing by the Bank to or for the credit or the account of the Borrower or
any Subsidiary against any and all of the Obligations of the Borrower now or
hereafter existing under this Agreement or the Revolving Note or any other Loan
Document, irrespective of whether or not the Bank shall have made any demand
under this Agreement or the Revolving Note or such other Loan Document and
although such Obligations may be unmatured. The Bank agrees promptly to notify
the Borrower after any such setoff and application, however, the parties hereto
agree that the failure to give such notice shall in no way affect the validity
of such setoff and application. The rights of the Bank under this Section 8.01
are in addition to other rights and remedies (including, without limitation,
other rights of setoff) which the Bank may have under Applicable Law.

 

ARTICLE IX

 

MISCELLANEOUS

 

Section 9.01.  Amendments, Etc.  No amendment, modification, termination, or
waiver of any provision of any Loan Document, nor consent to any departure from
any provision of any of the Loan Documents, shall in any event be effective
unless the same shall be in writing and signed by the Bank, and then such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given.

 

Section 9.02.  Notices, Etc.  Except as otherwise expressly provided herein, all
notices, requests, demands and other communications provided for under the Loan
Documents shall be in writing and sent by mail or telecopy (if by telecopy with
a confirmation mailed within two (2) Business Days thereafter), to the
applicable party at its address indicated below:

 

If to the Borrower:

 

Landmark Bancorp, Inc.
701 Poyntz Ave.
Manhattan, Kansas 66502
Attention: Mark Herpich, CFO

 

 

 

If to the Bank:

 

First National Bank of Omaha
1620 Dodge Street STOP 1090
Omaha, NE 68102
Attention: Natalie E. Mason
Facsimile: (402) 633-3760

 

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or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party complying as to delivery with the terms
of this Section.  All such notices, requests, demands and other communications,
when mailed, shall be effective when deposited in the mails, addressed as
aforesaid, or, when telefaxed, shall be effective when confirmation of receipt
is received.

 

Section 9.03.  No Waiver.  No failure or delay on the part of the Bank in
exercising any right, power, or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power, or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power, or remedy hereunder. The rights and remedies provided herein
are cumulative, and are not exclusive of any other rights, powers, privileges,
or remedies, now or hereafter existing, at law or in equity or otherwise.

 

Section 9.04.  Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the Borrower, the Subsidiaries and the Bank and their
respective successors and assigns, except that neither the Borrower nor any of
the Subsidiaries may assign or transfer any of its rights or obligations under
any Loan Document to which it is a party without the prior written consent of
the Bank.

 

Section 9.05.  Costs, Expenses, and Taxes.  The Borrower agrees to pay on demand
all costs and expenses incurred by the Bank in connection with the execution,
delivery, filing and administration of the Loan Documents and of any amendment,
modification, or supplement to the Loan Documents, including, without
limitation, the fees and out-of-pocket expenses of counsel for the Bank incurred
in connection with advising the Bank as to its rights and responsibilities
hereunder. Notwithstanding anything else herein to the contrary, the Borrower
shall not be required to pay for the Bank’s attorneys fees related to the
preparation of the Loan Documents.  The Borrower also agrees to pay all such
costs and expenses, including court costs, incurred in connection with
enforcement of the Loan Documents, or any amendment, modification, or supplement
thereto, whether by negotiation, legal proceedings, or otherwise. In addition,
the Borrower shall pay any and all stamp and other taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing, and
recording of any of the Loan Documents and the other documents to be delivered
under any such Loan Documents, and agrees to hold the Bank harmless from and
against any and all liabilities with respect to or resulting from any delay in
paying or omission to pay such taxes, fees, or expenses. This provision shall
survive termination of this Agreement.

 

Section 9.06.  Prohibition Against Usury.  In no event, either before or after
the occurrence of an Event of Default, shall the amount of interest due under
the Revolving Note or any other Loan Document exceed the maximum, lawful, non
usurious interest rate of the State of Nebraska or any other applicable law (the
“Maximum Rate”).  The Revolving Note and the other Loan Documents are hereby
expressly limited so that in no event whatsoever, whether by reason of
acceleration or otherwise, shall the amount paid, or agreed to be paid to the
Bank for the use, forbearance or detention of the sums advanced to the Borrower
exceed the Maximum Rate.  If fulfillment of any provisions hereof, at the time
performance of such provision shall be due, shall involve the potential for
transcending the Maximum Rate, the obligation to be fulfilled shall be

 

24

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reduced to the Maximum Rate, and if from any such circumstance the Bank shall
ever receive as interest an amount which would exceed the Maximum Rate, such
excess shall be applied to the reduction of the principal amount of the
Obligations and not the payment of interest, or if such excessive interest
exceeds the unpaid balance of the principal amount of the Obligations, such
excess shall be refunded to the Borrower.  All sums paid and agreed to be paid
to the Bank for use, forbearance or detention of the indebtedness of the
Borrower shall, to the extent permitted by the laws of the State of Nebraska, be
amortized, prorated, allocated, and spread through the whole term of such
indebtedness so that the actual rate of interest on account of such indebtedness
is uniform throughout the term thereof.

 

Section 9.07.  Integration.  This Agreement and the Loan Documents contain the
entire agreement between the parties relating to the subject matter hereof and
supersede all oral statements and prior writings with respect thereto.

 

Section 9.08.  Indemnity.  The Borrower and each of the Subsidiaries hereby
agree to defend, indemnify, and hold the Bank harmless from and against any and
all claims, damages, judgments, penalties, costs, and expenses (including
attorney fees and court costs now or hereafter arising from the aforesaid
enforcement of this clause) arising directly or indirectly from the activities
of the Borrower and its Subsidiaries, or arising directly from (i) the violation
of any Environmental Requirement, (ii) the violation of any Plan Requirement, or
(iii) the occurrence of any Event of Default hereunder. This indemnity shall
survive termination of this Agreement.

 

Section 9.09.  Governing Law.  This Agreement and the Revolving Note shall be
governed by, and construed in accordance with, the laws of the State of Nebraska
without giving effect to any choice or conflict of law provision or
rule (whether of the State of Nebraska or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
Nebraska.

 

Section 9.10.  Severability of Provisions.  Any provision of any Loan Document
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 of such Loan
Document or affecting the validity or enforceability of such provision in any
other jurisdiction.

 

Section 9.11.  Headings.  Article and Section headings in the Loan Documents are
included in such Loan Documents for the convenience of reference only and shall
not constitute a part of the applicable Loan Documents for any other purpose.

 

Section 9.12.  Counterparts.  This Agreement may be executed in one or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together will constitute one and the same
instrument.  A facsimile signature will be considered an original signature.

 

Section 9.13.  Jury Trial Waiver.  THE BANK AND THE BORROWER, BOTH ON ITS BEHALF
AND ON BEHALF OF EACH OF THE SUBSIDIARIES, HEREBY WAIVE TRIAL

 

25

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BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM, WHETHER IN CONTRACT
OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT OR THE LOAN DOCUMENTS. NO OFFICER OF THE BANK HAS AUTHORITY TO WAIVE,
CONDITION, OR MODIFY THIS PROVISION.

 

Section 9.14.  Waiver of Consequential Damages.  THE BANK, ITS AFFILIATES
AND THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, REPRESENTATIVES,
LEGAL COUNSEL AND CONSULTANTS SHALL NOT BE RESPONSIBLE OR LIABLE TO THE BORROWER
OR ANY OTHER PERSON FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES THAT
MAY BE ALLEGED AS A RESULT OF THIS AGREEMENT, ANY OF THE LOAN DOCUMENTS OR ANY
TRANSACTION CONTEMPLATED HEREBY, EVEN IF THE BANK OR ITS AFFILIATES AND THEIR
RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, REPRESENTATIVES, LEGAL
COUNSEL OR CONSULTANTS HAVE BEEN ADVISED OR KNEW, OR SHOULD HAVE KNOWN, OF THE
POSSIBILITY OF SUCH DAMAGES OR LOSS.

 

Section 9.15.  Submission to Jurisdiction; Venue.  The Borrower and any
Subsidiary collectively or individually as the case may be, hereby submit to the
jurisdiction of any state or federal court sitting in Omaha, Nebraska, in any
action or proceeding arising out of or relating to this Agreement and agree that
all claims in respect of the action or proceeding may be heard and determined in
any such court.  The Borrower and any Subsidiary also agree not to bring any
action or proceeding arising out of or relating to this Agreement in any other
court.  The Borrower and any Subsidiary waive any defense of inconvenient forum
to the maintenance of any action or proceeding so brought and waives any bond,
surety, or other security that might be required of the Bank.  The Borrower and
any Subsidiary agree that a final judgment in any action or proceeding so
brought shall be conclusive and may be enforced by suit on the judgment or in
any other manner provided by law or at equity.  The Borrower and any Subsidiary
hereby waive any rights they may have to transfer or change the venue of any
suit, action or other proceeding brought against the Borrower by the Bank in
accordance with this Section 9.16 or in connection with this Agreement or any
other Loan Documents.

 

Section 9.16.  Incorporation by Reference and Exhibits.  The recitals reflected
above, and each Exhibit, Loan Document or other document referred to in this
Agreement, are incorporated herein by this reference.  The Bank, Borrower and
any Subsidiary acknowledge and agree that the Exhibits attached hereto reflect
the form thereof as of the date of execution of this Agreement and shall, in the
reasonable discretion of the Bank, be amended from time to time or expanded to
reflect the appropriate party or parties thereto, to effectuate the
transactions, commitments and undertakings provided for herein and prior to the
Effective Date, and such amended or expanded Exhibits shall be deemed attached
hereto and incorporated herein by this reference.

 

Section 9.17.  No Third Party Beneficiaries.  Nothing in this Agreement, whether
express or implied, is intended or shall be construed to confer upon, either
directly or indirectly, or give any Person other than the parties hereto and
their respective successors, permitted assigns,

 

26

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personal representatives, heirs or beneficiaries any legal or equitable right,
remedy or claim under or in respect of this Agreement or any covenant, condition
or other provision contained herein.

 

Section 9.18.  Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but which
together shall constitute one and the same instrument. The signatures of the
parties hereto need not appear on the same counterpart, and delivery of an
executed counterpart signature page by facsimile is as effective as executing
and delivering this Agreement in the presence of the other parties to this
Agreement. Any party delivering an executed counterpart of this Agreement by
facsimile shall also deliver a manually executed counterpart of this Agreement,
but the failure to do so shall not affect the validity, enforceability or
binding effect of this Agreement.

 

Section 9.19.  Credit Agreement.  A CREDIT AGREEMENT MUST BE IN WRITING TO BE
ENFORCEABLE UNDER NEBRASKA LAW.  TO PROTECT THE PARTIES HERETO FROM ANY
MISUNDERSTANDING OR DISAPPOINTMENTS, ANY CONTRACT, PROMISE, UNDERTAKING, OR
OFFER TO FORBEAR REPAYMENT OF MONEY OR TO MAKE ANY OTHER FINANCIAL ACCOMMODATION
IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, OR ANY
AMENDMENT OF, CANCELLATION OF, WAIVER OF, OR SUBSTITUTION FOR ANY OR ALL OF THE
TERMS OR PROVISIONS OF ANY INSTRUMENT OR DOCUMENT EXECUTED IN CONNECTION WITH
THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, MUST BE IN WRITING TO BE
EFFECTIVE.

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective officers thereunto duly authorized, as of the date first above
written.

 

 

“Borrower”

 

 

 

LANDMARK BANCORP, INC.,

 

a Delaware corporation

 

 

 

By:

/s/ Mark A. Herpich

 

Title:

EVP / CFO

 

 

 

“Bank”

 

 

 

FIRST NATIONAL BANK OF OMAHA,

 

a national banking association

 

 

 

By:

/s/ Natalie E. Mason

 

 

Natalie E. Mason, Vice President

 

27

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PLEDGE AGREEMENT

 

THIS PLEDGE AGREEMENT (THIS “AGREEMENT”) IS MADE AND ENTERED INTO EFFECTIVE AS
OF THE 19TH DAY OF NOVEMBER, 2008, BY AND BETWEEN LANDMARK BANCORP, INC., A
DELAWARE CORPORATION (THE “PLEDGOR”), AND FIRST NATIONAL BANK OF OMAHA, A
NATIONAL BANKING ASSOCIATION (“FNB”).

 

WHEREAS, the Pledgor has entered into a Revolving Credit Agreement of even date
herewith (as amended, supplemented, or otherwise modified from time to time, the
“Credit Agreement”), with FNB, pursuant to which, among other things, Pledgor
has undertaken certain covenants and has executed and delivered to FNB a
Revolving Note of even date herewith payable to the order of FNB in the total
principal amount of Nine Million and No/100ths Dollars ($9,000,000.00) (the
“Note”), the proceeds of which may be drawn upon by the Pledgor for the purposes
described in the Credit Agreement, in accordance with and subject to the terms
and restrictions contained in the Credit Agreement; and

 

WHEREAS, Pledgor is the owner of one hundred percent (100%) of the outstanding
Equity Interests of Landmark National Bank, a national banking association
(“Landmark Bank”), consisting of Two Million (2,000,000) shares of common stock
of Landmark Bank represented by stock certificate number(s) R3, as of the date
hereof (the “Stock”); and

 

WHEREAS, under the Credit Agreement it is a condition precedent to FNB’s making
of any disbursements or Loans to Pledgor that the Pledgor shall have executed
and delivered this Agreement to FNB, securing the timely performance of all of
the Obligations, as defined in the Credit Agreement, of the Pledgor under the
Credit Agreement; and

 

WHEREAS, to secure the Obligations, Pledgor has agreed to pledge to FNB, the
Stock and all after-acquired Equity Interests in Landmark Bank, including,
without limitation, all rights in and to all profits, proceeds and distributions
of every kind and nature whatsoever due to Pledgor with respect to such Stock,
whether pursuant to the terms of the bylaws of Landmark Bank, a shareholder
agreement or other similar agreement, or otherwise (collectively, the “Pledged
Stock”); and

 

WHEREAS, in accordance with terms and provisions of the Credit Agreement and
this Agreement, Pledgor shall (i) pledge to FNB all of its right, title and
interest in and to any and all stock or other Equity Interests of Landmark Bank,
including but not limited to the Pledged Stock, and (ii) deliver all
certificates evidencing the Pledged Stock or other Equity Interests of Landmark
Bank and any and all financing statements or other documents sufficient to
create a valid and perfected first priority security interest in and to the
Pledged Stock or other Equity Interests in favor of FNB as additional collateral
to secure repayment of Pledgor’s Obligations under the Credit Agreement.

 

NOW, THEREFORE, in consideration of the premises set forth above, and other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, and intending to be legally bound, and in order to induce FNB to
enter into the Credit Agreement and to make disbursements to Pledgor of Loans,
the Pledgor hereby represents, warrants, covenants, and agrees with FNB, for
FNB’s benefit, as follows:

 

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

 

1.             Definitions:  All capitalized terms used in this Agreement,
including its preamble and recitals, that are not otherwise defined herein shall
have the meaning ascribed to them in the Credit Agreement.

 

2.             Security Interest:  Pledgor hereby BARGAINS, SELLS, GRANTS,
CONVEYS, TRANSFERS, PLEDGES, HYPOTHECATES, and ASSIGNS to FNB for its benefit, a
first priority security interest (the “Security Interest”) in the Pledged Stock,
together with all increases, replacements, additions and substitutions related
thereto, all dividends, distributions, return of capital, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of the Pledged Stock and all
subscription warrants, rights or options issued thereon or with respect thereto,
together with, and including, all rights of Pledgor pursuant to its bylaws, any
shareholder agreement or other similar agreements of Landmark Bank
(collectively, the “Pledge Agreement Collateral”), to secure the complete and
timely payment, performance or discharge of (i) each of the obligations and
covenants of Pledgor under this Agreement, the Credit Agreement, the Note or the
other Loan Documents, and all modifications, substitutions, extensions and
renewals of each, whether absolute or contingent, liquidated or unliquidated,
existing now or arising in the future and (ii) all present and future
indebtedness and obligations of Pledgor to the Secured Parties whether direct,
indirect, absolute, or contingent and whether arising by note, guaranty,
overdraft, or otherwise (individually, an “Obligation” and collectively, the
“Obligations”).  The Security Interest shall be effective with respect to each
item of Pledge Agreement Collateral for so long as any Obligation remains
outstanding or FNB has any Commitment under the Credit Agreement, regardless of
whether Pledgor becomes the owner of such Pledge Agreement Collateral prior to
or contemporaneously with or subsequent to the incurring of such Obligation.

 

3.             Priority of Security Interest; Financing Statements.  Pledgor
hereby acknowledges and agrees that so long as this Agreement remains in force
and effect, the Security Interest granted hereunder to FNB shall be a first
perfected security interest in the Pledge Agreement Collateral. Pledgor hereby
irrevocably authorizes FNB at any time and from time to time to file in any
Uniform Commercial Code jurisdiction any initial financing statements,
amendments and continuations thereto, in the name of Pledgor and describing the
Pledge Agreement Collateral.

 

4.             Delivery of Security Collateral.  Upon execution of this
Agreement, all certificates or instruments representing or evidencing the Pledge
Agreement Collateral shall be delivered by the Pledgor to FNB, held by FNB, in
suitable form for transfer, and accompanied by a duly executed Collateral Stock
Transfer and Assignment Power in the form set forth in Exhibit “A” attached
hereto and incorporated herein by this reference (the “Collateral Stock Transfer
Power”).  If, at any time, Pledgor subsequently obtains possession of any
certificate(s) or instrument(s) constituting or representing any of the Pledge
Agreement Collateral or any other Equity Interest in Landmark Bank, Pledgor
shall deliver such certificate(s) or instrument(s) to FNB forthwith, together
with a Collateral Stock Transfer Power duly executed by Pledgor, and the same
shall be subject to the terms of this Agreement.  Subject to the terms of this
Agreement, Pledgor hereby irrevocably appoints FNB as Pledgor’s attorney-in-fact
(such appointment being coupled with an interest), with power of substitution,
and FNB shall have the right, upon the occurrence of an Event of Default, as
hereinafter defined, or event which, with the giving of notice or the lapse of
time, or both, would become an Event of Default, at any time in its discretion
and without notice to the Pledgor, to transfer to or to register in the name of
FNB, or

 

2

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any of its nominees, any or all of the Pledge Agreement Collateral, subject to
the provisions of Section 9 of this Agreement.

 

5.             Representations, Warranties and Covenants.  Pledgor represents,
warrants and covenants with FNB that:

 

a.             The Pledged Stock constitutes all of Pledgor’s Equity Interest in
Landmark Bank, and the Pledge Agreement Collateral is free and clear of all
liens, encumbrances, security interests, adverse claims and restrictions of any
nature (other than those created under the terms of this Agreement). This
representation and warranty shall be deemed made with respect to each item of
property that becomes Pledge Agreement Collateral after the date hereof;

 

b.             Pledgor has obtained all consents or approvals, including but not
limited to Governmental Authority consents or approvals, necessary to enter
into, and effectuate the terms and provisions of this Agreement;

 

c.             Pledgor shall, from and after the date hereof, (i) keep the
Pledge Agreement Collateral free and clear of all liens, encumbrances, security
interests and restrictions, except for the Security Interest and liens permitted
under Section 6.01 of the Credit Agreement, and (ii) maintain and preserve the
Security Interest and FNB’s first perfected priority security interest in the
Pledge Agreement Collateral so long as this Agreement shall remain in effect;
and

 

d.            Following the date hereof, Pledgor will neither sell nor offer to
sell nor otherwise transfer nor further pledge or encumber any portion of the
Pledge Agreement Collateral (other than liens permitted under Section 6.01 of
the Credit Agreement); nor will Pledgor enter into any agreement which relates
to the voting of or restricts the transfer of any of the Pledge Agreement
Collateral, without the prior written consent of FNB.

 

6.             Distributions. So long as no Event of Default, or event which,
with the giving of notice or the lapse of time, or both, would become an Event
of Default, shall have occurred, the Pledgor shall be entitled to receive and
retain any and all distributions and interest paid, if applicable, in respect of
the Pledge Agreement Collateral, provided, however, that:

 

a.             Pledgor shall not accept or receive any payments with respect to
the Pledge Agreement Collateral other than (i) in cash, or (ii) stock splits or
dividends relating to the Pledge Agreement Collateral, provided that upon any
distribution permitted under this subsection (ii), such distribution shall
become part of the Pledge Agreement Collateral, in accordance with, and subject
to, the terms and provisions of this Agreement; or

 

b.             Pledgor shall not accept or receive any payments of any kind in
respect of Pledge Agreement Collateral or any part thereof, in connection with a
partial or total liquidation or dissolution of Pledgor or Landmark Bank,

 

3

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and in the event any payments, whether or not specifically permitted hereunder,
described in items (a) through (b), including (i) and (ii) of item (a), are
made, they shall be forthwith delivered to FNB to hold as part of the Pledge
Agreement Collateral for the benefit of FNB and shall, if received by the
Pledgor, be received in trust for the benefit of FNB, be segregated from the
other property or funds of the Pledgor, and be forthwith delivered to FNB as
part of the Pledge Agreement Collateral in the same form as so received (with
any and all necessary endorsement or assignment).

 

7.             Rights of Pledgor.  Except as otherwise provided herein, during
the period while this Agreement remains in force and as long as an Event of
Default, or event which, with the giving of notice or the lapse of time, or
both, would become an Event of Default, shall have not occurred, Pledgor shall
be entitled to exercise all rights with respect to the Pledged Stock, subject to
the Security Interest granted hereunder, including, but not limited to, the
right to vote the Pledged Stock.

 

8.             Events of Default.  Each of the following occurrences shall
constitute an Event of Default under this Agreement (herein called “Event of
Default”):

 

a.             The occurrence of an Event of Default under the Credit Agreement
or under any of the other Loan Documents; and

 

b.             Pledgor shall hypothecate, transfer or assign, or shall attempt
to hypothecate, transfer or assign, the Pledge Agreement Collateral to any
person or entity without FNB’s prior written consent.

 

9.             Remedies Upon Event of Default.  Upon the occurrence of an Event
of Default and subject to the terms of this Agreement,

 

a.             All rights of the Pledgor to exercise or refrain from exercising
its voting rights which it would otherwise be entitled to exercise pursuant to
Section 7 above and to receive the distributions and interest payments, if
applicable, which it would otherwise be authorized to receive and retain
pursuant to Section 6 shall cease, and all such rights shall thereupon become
vested in FNB who shall thereupon have the right to exercise or refrain from
exercising such voting and other consensual rights and to receive and hold as
Pledge Agreement Collateral such distributions and interest payments; and

 

b.             All distributions and interest payments, if applicable, which are
received by the Pledgor contrary to the provisions of paragraph a of this
Section 9 shall be received in trust for the benefit of FNB, shall be segregated
from other funds of the Pledgor and shall be forthwith paid over to FNB as
Pledge Agreement Collateral in the same form as so received (with any and all
necessary endorsement or assignment); and

 

c.             FNB may, in connection with the exercise of its foreclosure
rights under Applicable Law and to the extent permitted thereunder, as the
attorney-in-fact for the Pledgor, transfer all of the Pledgor’s right, title and
interest in and to the Pledged Stock to FNB thereby terminating any and all
right, title and interest of Pledgor in or to Landmark Bank or any of its
assets; and FNB may exercise and enforce any or all other rights and remedies
available to FNB by law or agreement against the Pledge Agreement Collateral,

 

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against Pledgor or against any other person or property; provided, however, that
FNB shall give Pledgor not less than ten (10) days’ written notice of its
intention to make any such public or private sale or at any broker’s board or on
any securities exchange (with such notice to state the time and place of such
sale) of the Pledged Stock.

 

10.           Continuing Security Interest. This Agreement shall create a
continuing Security Interest in the Pledge Agreement Collateral and shall remain
in full force and effect until the complete discharge of all of the Pledgor’s
Obligations under this Agreement, the Credit Agreement, the Note and all other
Loan Documents. Upon the discharge of all of Pledgor’s Obligations under this
Agreement, the Credit Agreement, the Note and all other Loan Documents, the
Security Interest shall cease and terminate, the Pledge Agreement Collateral
shall revert to the Pledgor, and FNB, at Pledgor’s expense, agrees to execute
such documents as the Pledgor shall reasonably request to evidence such
termination.

 

11.           Miscellaneous.

 

a.             This Agreement may be waived, modified, amended, terminated or
discharged, and the Security Interest may be released, only (i) upon complete
discharge of Pledgor’s Obligations under the Credit Agreement, the Note and the
other Loan Documents or (ii) explicitly in a writing signed by FNB and the
Pledgor.  A waiver signed by FNB shall be effective only in the specific
instance and for the specific purpose given.

 

b.             No failure or delay on the part of FNB in exercising any right,
power, or remedy hereunder shall operate as a waiver thereof or otherwise
preclude the exercise or enforcement of any of FNB’s rights or remedies
hereunder.

 

c.             All rights and remedies of FNB shall be cumulative and may be
exercised singularly or concurrently, at FNB’s option, and the exercise or
enforcement of any one such right or remedy shall neither be a condition to nor
bar the exercise or enforcement of any other.

 

d.             All notices to be given to Pledgor shall be deemed sufficiently
given if delivered or mailed by registered or certified mail, postage prepaid,
to Pledgor at its address as set forth in the Credit Agreement.

 

e.             FNB shall not be obligated to preserve any rights Pledgor may
have against any other parties, to exercise at all or in any particular manner
any rights which may be available to FNB with respect to any Pledge Agreement
Collateral, to realize on the Pledge Agreement Collateral at all or in any
particular manner or order, or to apply any cash proceeds of Pledge Agreement
Collateral in any particular order of application.

 

f.              Pledgor will reimburse FNB for all expenses (including
reasonable attorneys’ fees and legal expenses) incurred by FNB in the
protection, defense or enforcement of the Security Interest, including expenses
incurred in any litigation or bankruptcy or insolvency proceedings.

 

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g.             This Agreement shall be binding upon and inure to the benefit of
Pledgor and FNB and their respective heirs, representatives, successors and
assigns, provided, however, that the Pledgor may not assign any of its rights or
obligations hereunder or to the Pledged Stock without the prior written consent
of FNB, which consent may be withheld in FNB’s sole discretion.

 

h.             This Agreement shall take effect when signed by Pledgor and
delivered to FNB.  Pledgor hereby waives notice of FNB’s acceptance hereof.

 

i.              Time is an essential element to the performance of each of the
terms of this Agreement.

 

j.              All headings appearing in this Agreement are for convenience of
reference only and shall be disregarded in construing this Agreement.  The
recitals contained above and all documents referred to herein are incorporated
herein by this reference.

 

k.             This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Nebraska without giving effect to any choice or
conflict of law provision or rule (whether of the State of Nebraska or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of Nebraska (the “Governing Law”).

 

l.              Pledgor submits to the jurisdiction of any federal court sitting
in Omaha, Nebraska, in any action or proceeding arising out of or relating to
this Agreement and agrees that all claims in respect of the action or proceeding
may be heard and determined in any such court.  Pledgor also agrees not to bring
any action or proceeding arising out of or relating to this Agreement in any
other court.  Pledgor waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety,
or other security that might be required of FNB.  Pledgor agrees that a final
judgment in any action or proceeding so brought shall be conclusive and may be
enforced by suit on the judgment or in any other manner provided by law or at
equity.  Pledgor hereby waives any rights it may have to transfer or change the
venue of any suit, action or other proceeding brought against Pledgor by FNB in
accordance with this paragraph or in connection with this Agreement.

 

m.            PLEDGOR HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING,
CLAIM, OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY,
ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT.  NO EMPLOYEE OF FNB HAS
AUTHORITY TO WAIVE, CONDITION, OR MODIFY THE TERMS AND PROVISIONS OF THIS
PARAGRAPH OF THIS AGREEMENT.

 

n.             If any provision or application of this Agreement is held
unlawful or unenforceable in any respect, such illegality or unenforceability
shall not affect other provisions or application which can be given effect, and
this Agreement shall be construed as if the unlawful or unenforceable provision
or application had never been contained herein or prescribed hereby.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date and year first above written.

 

 

“Pledgor”

 

 

 

LANDMARK BANCORP, INC.,

 

a Delaware corporation

 

 

 

 

By:

/s/ Mark A. Herpich

 

 

 

 

Its:

EVP/CFO

 

 

 

 

 

 

 

“FNB”

 

 

 

FIRST NATIONAL BANK OF OMAHA,

 

a national banking association

 

 

 

 

By:

/s/ Natalie E. Mason

 

 

 

 

Its:

Vice President

 

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EXHIBIT “A”

 

Collateral Stock Transfer and Assignment Power

 

[See the Attached]

 

 

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REVOLVING NOTE

 

$9,000,000.00

 

November 19, 2008

 

 

Omaha, Nebraska

 

FOR VALUE RECEIVED, the undersigned, LANDMARK BANCORP, INC., a Delaware
corporation (“Borrower”), HEREBY PROMISES TO PAY to the order of FIRST NATIONAL
BANK OF OMAHA (the “Lender”) in lawful money of the United States and in
immediately available funds, the principal amount of Nine Million and No/100ths
Dollars ($9,000,000.00) or, if less, the aggregate unpaid principal amount of
the Loans made by the Lender to Borrower pursuant to the terms and provisions of
the Credit Agreement, as hereinafter defined (the “Principal Amount”).

 

Borrower further promises to pay (a) the Principal Amount, (b) interest on the
unpaid Principal Amount from the date advanced at the rates and times specified
in the Credit Agreement and (c) fees, costs and expenses at such times and at
such rates and amounts specified in the Credit Agreement; each without off-set,
deduction or counterclaim, until such time as all of the foregoing are paid in
full.  The unpaid Principal Amount hereof, together with all accrued and unpaid
interest and fees, shall be due and payable on the date that is the earliest to
occur of the following: (a) November 19, 2009, (b) the date the Obligations are
accelerated pursuant to the Credit Agreement or this Revolving Note and (c) the
date the Lender has received indefeasible payment in full of the Obligations. 
All payments of the Principal Amount, interest, and fees, costs and expenses due
and payable, when paid shall be made to the Lender at the Lender’s office in
accordance with the Credit Agreement.

 

This Revolving Note is the Revolving Note referred to in the Revolving Credit
Agreement, dated as of the date hereof, by and between Borrower and the Lender
(as amended, supplemented, or otherwise modified from time to time, the “Credit
Agreement”), the terms and conditions of which are incorporated herein by this
reference.  This Revolving Note is entitled to the benefits set forth in the
Loan Documents.  In the event of a conflict or inconsistency between the terms
of this Revolving Note and the Credit Agreement, the terms and provisions of the
Credit Agreement shall govern.  Capitalized terms not otherwise defined in this
Revolving Note which are defined in the Credit Agreement shall have the meanings
ascribed thereto in the Credit Agreement.

 

The Credit Agreement, among other things, contains (a) enumerated Events of
Default, (b) provisions for acceleration of the maturity of this Revolving Note
upon the happening of certain stated events, (c) provisions for prepayments of
the Principal Amount of this Revolving Note prior to the maturity of the
Revolving Note, and (d) provisions for modification or waiver of this Revolving
Note upon the terms and conditions specified in the Credit Agreement.

 

The occurrence of any Event of Default enumerated in the Credit Agreement or any
of the other Loan Documents shall constitute an Event of Default under this
Revolving Note.  Upon any such Event of Default, the Lender shall have any and
all rights and remedies provided in the Credit Agreement or any of the other
Loan Documents, including but not limited to the right, but not the obligation,
to accelerate the due date of this Revolving Note and to declare all Obligations
set forth herein or therein immediately due and payable, and such other remedies
as

 

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are provided by law.  No failure to exercise, and no delay in exercising, any
rights hereunder on the part of the Lender shall operate as a waiver of such
rights.

 

Borrower acknowledges that the Obligations evidenced by this Revolving Note are
for business purposes only and are not an extension of consumer or individual
credit.

 

This Revolving Note is made under and governed by the laws of, and shall be
deemed to have been executed in, the State of Nebraska without giving effect to
choice of law principles (whether of the State of Nebraska or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of Nebraska.

 

THE LENDER AND BORROWER HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING,
CLAIM, OR COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY,
ARISING OUT OF OR IN ANY WAY RELATED TO THIS REVOLVING NOTE.  NO OFFICER OR
EMPLOYEE OF THE LENDER HAS AUTHORITY TO WAIVE, CONDITION, OR MODIFY THIS
PROVISION.

 

Time is of the essence as to each and every date and each and every Obligation
of Borrower set forth in this Revolving Note.

 

BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY GOVERNING
LAW, PRESENTMENT FOR PAYMENT, NOTICE OF NONPAYMENT, NOTICE OF DISHONOR, PROTEST,
NOTICE OF PROTEST, DEMAND, NOTICE OF EVERY KIND IN CONNECTION HEREWITH AND
DILIGENCE IN ENFORCING PAYMENT OR BRINGING SUIT AGAINST ANY PARTY HERETO.

 

IN WITNESS WHEREOF, Borrower has caused this Revolving Note to be executed and
delivered to the Lender as of the day and year first written above.

 

 

LANDMARK BANCORP, INC.,

 

a Delaware corporation

 

 

 

 

By:

/s/ Mark A. Herpich

 

 

 

 

Its:

EVP/CFO

 

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