Exhibit 10.5
EXECUTION COPY
FOURTH AMENDED AND RESTATED LOAN AGREEMENT
WAIVER AND AMENDMENT
     THIS WAIVER AND AMENDMENT, dated as of August 10, 2009 (this “Waiver”), is
entered into by and among Mercantile Bancorp, Inc., a Delaware corporation
(“Borrower”), and Great River Bancshares, Inc., a Nevada corporation (“Lender”).
All capitalized terms used herein and not otherwise defined herein shall have
the meanings given to such terms in the Loan Agreement (as defined below).
RECITALS
     WHEREAS, Borrower and Lender are parties to that certain Fourth Amended and
Restated Loan Agreement dated as of April 30,2009 (the “Loan Agreement”);
     WHEREAS, Borrower has breached Sections 5.13 and 6.12 of the Loan Agreement
(the “Breached Provisions”) and as a result an Event of Default, as defined in
Section 7 of the Loan Agreement, has occurred;
     WHEREAS, Borrower has requested Lender to waive the Event of Default under
the Loan Agreement resulting solely from the Breached Provisions, and Lender is
willing to waive such Event of Default in accordance with the terms and
conditions of this Waiver;
     WHEREAS, Lender has also agreed to extend the payment dates for the payment
of the principal amounts outstanding on the Term Note A; and
     WHEREAS, Borrower has requested Lender to amend certain sections of the
Loan Agreement and Lender is willing to amend those certain sections as set
forth in this Waiver.
     NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
     1. Waiver. Subject to the other terms and conditions of this Waiver, Lender
hereby waives the Event of Default caused solely by: (i) Borrower’s failure to
comply with Section 5.13 of the Loan Agreement as of June 30, 2009;
(ii) Borrower’s failure to comply with Section 6.12 of the Loan Agreement
through the date hereof; and (iii) Borrower’s failure to comply with Section
5.11 of the Loan Agreement solely with respect to Borrower and Royal Palm Bank
through the date hereof; and hereby extends the principal payments on the Term
Note A pursuant to Section 2.02(a) of the Loan Agreement and to Term Note A.
Lender hereby further waives the Event of Default caused by Borrower’s failure
to comply with Section 5.11 of the Loan Agreement solely with respect to
Borrower and Royal Palm from the date hereof until and including August 31,
2009. Except for the waiver and extension expressly set forth in the immediately
preceding sentence, this Waiver does not modify or affect the obligations of the
Borrower to comply fully with all terms, conditions and covenants contained in
the Loan

 

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Agreement (as amended below) or any of the other Transaction Documents. Nothing
contained in this Waiver shall be deemed to constitute a waiver of any other
Default or Event of Default under the Transaction Documents or a waiver of any
rights or remedies Lender may have arising as a result of such other Defaults or
Events of Default or any other rights or remedies Lender may have under any
Transaction Document or under applicable law.
     2. Amendments. The Loan Agreement shall be amended by deleting the Sections
2.02(a), 5.13, 5.16, 6.12 and 7.12 in their entirety and replacing them with the
following:
     (a) “2.02(a) Lender has acquired from US Bank and assumed all of US Bank’s
right, title and interest in and to a term loan of Fifteen Million One Hundred
Nine Thousand One Hundred Twelve Dollars and Fifty Cents ($15,109,112.50) (“Term
Loan A”) initially made by US Bank to Borrower pursuant to the Original Loan
Agreement. Term Loan A is not revolving in nature and any principal repaid on
Term Loan A may not be reborrowed. The principal amount of Term Loan A shall be
due and payable in two (2) installments as follows: the first installment of
$750,000 shall be due and payable on September 30, 2009, and a final installment
in the amount of the then outstanding and unpaid principal balance of Term Loan
A shall be due and payable on November 10, 2009.”
     (b) “5.13 Consolidated Fixed Charge Coverage Ratio. Maintain a Consolidated
Fixed Charge Coverage Ratio of at least (i) 0.5 to 1.00 for the period from
January 1, 2009 through September 30, 2009, as measured as of September 30,
2009; and (ii) 1.10 to 1.00 for each four (4) consecutive fiscal quarter period
ending on or after December 31, 2009.”
     (c) “5.16 Stockholders’ Equity. Maintain as of the last day of each
calendar month stockholders’ equity determined in accordance with GAAP in an
amount equal to or greater than $45.4 million.”
     (d) “6.12 Non-Performing Assets. Permit the aggregate amount of
Non-Performing Assets of all Subsidiary Banks on a combined basis to equal or
exceed (i) Fifty Percent (50%) of the then Primary Capital of all Subsidiary
Banks, as determined according to GAAP, at any time from the date of this
Agreement through August 31, 2009, or (ii) Thirty-Six Percent (36%) of the then
Primary Capital of all Subsidiary Banks, as determined according to GAAP, at any
time from September 1, 2009 through September 30, 2009, or (iii) Eighteen
Percent (18%) of the then Primary Capital of all Subsidiary Banks, as determined
according to GAAP, at any time from and after October 1, 2009.”
     (e) “7.12 (i) Any Subsidiary Bank shall cease to be an “insured bank” under
or within the meaning of the Federal Deposit Insurance Act of 1959, as amended;
(ii) a cease and desist order, memorandum of understanding or other agreement
shall be issued by any Regulatory Agency against or affecting any Subsidiary
Holding Company, any Subsidiary Bank (other than Heartland Bank and Royal Palm
Bank) or any other Obligor

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(except Borrower) which (in Lender’s reasonable opinion) has or could have a
Material Adverse Effect on the business, operation or condition, financial or
otherwise, of Borrower, any Subsidiary Holding Company, any Subsidiary Bank or
any other Obligor; (iii) the Memorandum of Understanding issued by the Federal
Reserve Bank of St. Louis on March 17, 2009 with respect to Borrower is modified
or amended in any manner (the “MOU”) that makes the same more burdensome upon,
more restrictive of, or imposes new conditions, limitations or requirements on
Borrower as determined in the sole discretion of Lender; (iv) the cease and
desist order issued by the Florida Office of Financial Regulation and the
Federal Deposit Insurance Corporation (the “FDIC”) on May 7, 2009, with respect
to Royal Palm Bank (the “Royal Palm Order”) is modified or amended in any manner
that makes the same more burdensome upon, more restrictive of, or imposes new
conditions, limitations or requirements on Royal Palm Bank as determined in the
sole discretion of Lender; (v) the cease and desist order issued by the State
Bank Commissioner of the State of Kansas and the FDIC on March 9, 2009 with
respect to Heartland Bank (the “Heartland Order”) is modified or amended in any
manner that makes the same more burdensome upon, more restrictive of, or imposes
new conditions, limitations or requirements on Heartland Bank as determined in
the sole discretion of Lender; or (vi) Borrower, any Subsidiary Holding Company
or any Subsidiary Bank fails to comply with the terms of the MOU, the Royal Palm
Order or the Heartland Order, or any amendment or waiver thereof in any respect
as determined in the sole discretion of Lender.”
     3. Definitions. Section 1 of the Agreement shall be modified by deleting
the defined term “Actual Order” and “Draft Order” and adding the following
definition in alphabetical order: “Royal Palm Order” shall have the meaning
ascribed thereto in Section 7.12.”
     4. Miscellaneous.
     (a) Except as herein specifically agreed, the Transaction Documents, and
the obligations of Borrower thereunder, are hereby ratified and confirmed in all
respects and shall remain in full force and effect according to their respective
terms. Borrower agrees to strictly comply with the terms of this Waiver and each
Transaction Document. Each Transaction Document shall continue to constitute a
legal, valid and binding obligation of Borrower enforceable against Borrower in
accordance with its respective terms except as such enforceability may be
limited by bankruptcy, insolvency or other similar laws affecting creditors’
rights in general. Any breach of the terms of this Waiver shall constitute and
Event of Default under the Loan Agreement.
     (b) Borrower hereby represents and warrants to Lender as follows:
     (i) Borrower has taken all necessary action to authorize the execution,
delivery and performance of this Waiver.

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     (ii) This Waiver has been duly executed and delivered by the Borrower and
constitutes the Borrower’s legal, valid and binding obligation, enforceable
against Borrower in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency or other similar laws affecting creditors’
rights in general.
     (iii) No consent, approval, authorization or order of, or filing,
registration or qualification with, any court or governmental authority or third
party is required in connection with the execution, delivery or performance of
this Waiver by the Borrower.
     (iv) The execution, delivery and performance of this Waiver does not and
will not: (A) violate any provision of law applicable to Borrower, the
certificate of incorporation, bylaws, or other applicable governing document of
Borrower or any order, judgment, or decree of any court or agency of government
binding upon Borrower; (B) conflict with, result in a breach of or constitute
(with due notice or lapse of time or both) a default under any material
contractual obligation of Borrower; or (C) result in or require the creation or
imposition of any lien upon any of the assets of Borrower.
     (v) The representations and warranties of the Borrower set forth in the
Transaction Documents are true and correct as of the date hereof with the same
effect as if made on and as of the date hereof, except to the extent such
representations and warranties expressly relate solely to an earlier date, and,
after giving effect to this Waiver, no Default or Event of Default has occurred
and is continuing.
     (c) IN ADDITION, TO INDUCE LENDER TO AGREE TO THE TERMS OF THIS WAIVER,
BORROWER ON BEHALF OF ITSELF AND EACH OBLIGOR REPRESENTS AND WARRANTS THAT AS OF
THE DATE OF ITS EXECUTION OF THIS WAIVER, THERE ARE NO CLAIMS OR OFFSETS AGAINST
OR DEFENSE OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE TRANSACTION DOCUMENTS
AND IN ACCORDANCE THEREWITH IT:
          (i) WAIVER. ON BEHALF OF ITSELF AND EACH OBLIGOR, WAIVES ANY AND ALL
SUCH CLAIMS, OFFSETS, DEFENSE OR COUNTERCLAIMS WHETHER KNOWN OR UNKNOWN, ARISING
PRIOR TO THE DATE OF ITS EXECUTION OF THIS WAIVER; AND
          (ii) RELEASE. ON BEHALF OF ITSELF AND EACH OBLIGOR, RELEASES AND
DISCHARGES LENDER AND ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS,
AFFILIATES AND ATTORNEYS (COLLECTIVELY, “RELEASED PARTIES”) FROM ANY AND ALL
OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF ACTION OR
DEMANDS WHATSOEVER, WHETHER

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KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH BORROWER OR
ANY OBLIGOR EVER HAD, NOW HAS, CLAIMS TO HAVE OR MAY HAVE AGAINST ANY RELEASED
PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THE
TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
     (d) Borrower acknowledges and agrees that as of the date hereof Lender has
fully performed all obligations that it may have under the Transaction
Documents.
     (e) This Waiver may be executed in any number of counterparts, each of
which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of an executed
counterpart of this Waiver by telecopy shall be effective as an original and
shall constitute a representation that an executed original shall be delivered.
     (f) THIS WAIVER EMBODIES THE ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN
PARTIES HERETO AND SUPERSEDES ALL PRIOR AGREEMENTS AND UNDERSTANDINGS (ORAL OR
WRITTEN) RELATING TO THE SUBJECT MATTER HEREOF. THIS WAIVER AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.
     (g) IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS WAIVER SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS WAIVER ONLY BY ANOTHER WRITTEN AGREEMENT. THIS
NOTIFICATION APPLIES TO ALL OTHER CREDIT AGREEMENTS IN EFFECT BETWEEN THE
PARTIES HERETO.
     (h) Borrower agrees to pay on demand all out-of-pocket expenses incurred by
Lender (including fees and expenses of counsel) incurred in connection with the
negotiation and preparation of this Waiver.
[Remainder of Page Intentionally Left Blank]

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     Each of the parties hereto has caused a counterpart of this Waiver to be
duly executed and delivered as of the date first above written.

                  Borrower:    
 
                MERCANTILE BANCORP, INC.    
 
           
 
  By:   /s/ Ted T. Awerkamp    
 
                Name: Ted T. Awerkamp         Title: President & Chief Executive
Officer    
 
                Lender:    
 
                GREAT RIVER BANCSHARES, INC.    
 
           
 
  By:   /s/ R. Dean Phillips    
 
                Name: R. Dean Phillips         Title: Chairman of the Board