Document:

exv10w18

Exhibit 10.18

FOURTH AMENDED AND RESTATED

PRE-OPENING FUNDS AGREEMENT

     This Fourth Amended and Restated Pre-Opening Funds Agreement (“Agreement”) is entered into as
of the ___ day of                     , 2008 by and among United Business Holdings, Inc., a corporation
organized under the laws of the State of Nevada (“Company”), and each of the undersigned
individuals (each, a “Founder”).

RECITALS

     WHEREAS, the Company and certain of the Founders in the Arizona and California markets
previously have entered into that certain Third Amended and Restated Pre-Opening Funds Agreement,
dated as of                     , 2007 and certain other such Founders have executed a copy of that Third
Amended and Restated Pre-Opening Funds Agreement on various dates after                     , 2007;

     WHEREAS, the Founders have the mutual intention and objective to charter two commercial banks,
one each in California and Arizona (the “Proposed Banks”) and have established the Company to pay
the Proposed Banks’ formation expenses and to enter into agreements in furtherance of the formation
of the Proposed Banks;

     WHEREAS, the Founders desire to take such steps and actions as may be necessary in the
furtherance of their mutual intentions and objectives, including, but not limited to, the filing of
regulatory applications (the “Applications”) with the Federal Reserve, the Federal Deposit
Insurance Corporation (“FDIC”), the Office of the Comptroller of the Currency (“OCC”) and/or any
applicable state bank regulatory authority (“State Regulator”), as applicable (the “Regulators”);

     WHEREAS, the Founders further desire by this Agreement to provide for the advancement of funds
to cover the formation (pre-incorporation and pre-opening) expenses of the Company and the Proposed
Banks among the Founders, to be expended for the purpose of paying expenses to be incurred in order
to determine the feasibility of the Proposed Banks and to prepare the Applications and to charter
the Proposed Banks; and

     WHEREAS, the Founders now desire to make certain changes to the Third Amended and Restated
Pre-Opening Funds Agreement relating to the California and Arizona markets in order to revise the
agreements and arrangements among themselves.

     NOW, THEREFORE, in consideration of the foregoing and the promises, covenants and conditions
hereinafter set forth and in consideration of executing this Fourth Amended and Restated
Pre-Opening Funds Agreement, and in consideration of the contribution of money provided for herein
and other good and valuable consideration, receipt of which is hereby acknowledged, the Founders
hereto agree as follows:

© Copyright 2007 - All Rights Reserved

LIBC/1595405.2

 

 

     1. Payments of Funds for Pre-Incorporation Expenses. Each Founder, by execution of a
counterpart hereof, hereby agrees to contribute funds in the total amount of $45,000 (“Pre-Opening
Funds”) for the purpose of funding formation expenses of the Company and the Proposed Banks. To
the extent not previously paid pursuant to the Pre-Opening Funds Agreement, a payment of $15,000
shall be made by such Founder concurrently with the execution of this Agreement, and two (2)
additional payments of $15,000 each shall be made within five (5) business days after notice from
the Co-Managers (as defined below) that the next payment is due. Any amount previously paid to the
Company and delivered to the Co-Managers (as defined below) pursuant to the terms of this Agreement
will be deducted from the $45,000 total owed pursuant to this Agreement. Pre-Opening Funds paid by
check shall be made payable to “United Business Holdings, Inc. (or to the name of any successor of
United Business Holdings, Inc.)” Unless otherwise agreed by a vote of two-thirds of the
then-existing Founders, the failure of a Founder to contribute the amounts and provide the guaranty
provided hereunder this Section shall constitute a voluntary withdrawal of the Founder as set forth
in Section 9 hereof; provided, however, the Co-Managers shall have the authority to enter into
specific arrangements with various Founders to pay the $45,000 of Pre-Opening Funds at some point
other than at execution hereof if the Co-Managers determine that such an arrangement is in the
best interests of the Company; provided further that at the discretion of the Co-Managers, a
Founder may provide his contribution to the chartering process by making a cash payment in the
amount of $                    , which amount will satisfy such Founder’s full contribution to the
chartering process. Accordingly, a Founder who makes such cash payment of $                     will not
have an obligation to guaranty the line of credit which is referenced in this Section 1 and in
Section 14 below.

     The Founders anticipate the Co-Managers will present a budget for the pre-opening expenses of
the Company and the Proposed Banks. It is currently anticipated that these expenses will be
covered by the cash advances provided for in this Section 1 and by a line of credit provided to the
Company by a financial institution upon the receipt of preliminary regulatory approvals to charter
the Proposed Banks. If required by the issuing financial institution in order to issue the
pre-opening line of credit, each Founder further agrees to provide a limited guarantee (not joint
and several) with respect to any advances made under such line of credit; provided, however, that
the exposure of each Founder pursuant to such limited guarantee shall not be in excess of the
multiple of such Founder’s pro rata share of any advances made under such line of credit and
whatever margin of such pro rata share required by the issuing financial institution.

     Each Founder, by executing this Agreement, hereby authorizes the Company to enter into
agreements with Hunton & Williams LLP.

     2. Accounts, Co-Managers, and Terms Under Which Pre-Opening Funds Shall Be Held. All
Pre-Opening Funds shall be deposited in a deposit account (the “Account”) established in the name
of the Company at Nexity Bank or at a federally-insured depository institution domiciled or
authorized to do business in either California or Arizona, as the case may be and selected by the
respective management team of each Proposed Bank (as defined below). The Co-Managers and/or the
proposed officers of the respective Proposed Banks shall establish an Account for each Proposed
Bank. The Pre-Opening Funds from Founders associated with each Proposed Bank will be deposited
into the appropriate Account. Each Account shall be

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clearly designated as Pre-Opening Funds for the California Proposed Bank or for the Arizona
Proposed Bank as the case may be. The Co-Managers or the Founders (including the Co-Managers)
associated with that Proposed Bank, acting by a vote of at least two-thirds of their number, may
transfer either Account to another banking organization domiciled or authorized to do business in
California or Arizona, as the case may be. The proposed chairman of the board and the proposed
president of each Proposed Bank acting jointly shall have decision making authority relating to the
Account associated with such Proposed Bank. All decisions relating to the Accounts must be
ratified by the board of directors of the Company at least monthly.

     Pre-Opening Funds may be accepted from a proposed Founder by or on behalf of one of the
Co-Managers, or the proposed chairman or president of each Proposed Bank. Following execution of
this Agreement by a Founder, any funds accepted by representatives of the Company or any Proposed
Bank from a Founder shall not be returned to the Founder except as provided herein.

     Unless and until changed by the vote of two-thirds of all of the Founders, Tom Hassey and Ed
Brand are hereby appointed to serve as Co-Managers of each Account (the “Co-Managers”), and are
authorized to receive, deposit and disburse all funds to be collected or paid pursuant to the terms
of this Agreement and to take such other actions as may be contemplated by this Agreement. Either
of the Co-Managers may delegate the responsibility of receiving, depositing and/or disbursing funds
to the officers of the Company or to the proposed management team of each Proposed Bank.

     3. Terms Under Which Pre-Opening Funds Shall Be Disbursed. Disbursements from each
Account may be made upon the order and signature of either of the Co-Managers or upon the order and
signature of any officer of the Company or proposed officer of any Proposed Bank to whom the
Co-Managers have delegated such authority, and only for purpose of paying formation expenses of the
Company or the Proposed Banks, including but not limited to (i) marketing and banking consulting
fees, (ii) economic study fees, (iii) pre-opening consulting fees to be paid to one or more
proposed officers of the Proposed Banks, and others (all as approved by a majority of the
Founders), (iv) accounting and legal fees, (v) application fees and expenses, and (vi) rent, lease
and/or option payments and security deposits; provided, however, that no disbursement in excess of
$1,000 (except reimbursement of properly documented out-of-pocket expenses) shall be made to any
Co-Manager unless and until such payment or payments have been approved in advance by at least a
majority of the Founders who are then parties to this Agreement or unless such payment is subject
to another agreement with the Company.

     All formation expenses relating to the California Proposed Bank will be paid out of the
Account (the “California Account”) holding the Pre-Opening Funds received from the Founders
associated with the California Proposed Bank (the “California Pre-Opening Funds”) and all formation
expenses relating to the Arizona Proposed Bank will be paid out of the Account (the “Arizona
Account”) holding the Pre-Opening Funds received from the Founders associated with the Arizona
Proposed Bank (the “Arizona Pre-Opening Funds”). All formation expenses relating to the Company
will be paid equally out of the California Account, the Arizona Account and the Account (the “Texas
Account”) holding the Pre-Opening Funds received from the Founders associated with the Texas
Proposed Bank.

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     4. Additional Founders. The Founders understand and acknowledge that this is an
ongoing process and that there are benefits to the Company and the Proposed Banks in adding
Founders as the process moves forward. Upon the approval of the Co-Managers, additional Founders
may be added from time to time, provided that such additional Founders ratify and agree to be bound
by and comply with the provisions, terms and conditions of this Agreement. Each additional Founder
shall execute a signature page to this Agreement (and such other instrument as counsel to the
Company shall require) and shall immediately contribute funds in the same amount as has been
contributed as of such date by each of the other Founders.

     5. Relationship of Founders to Proposed Banks. The Founders acknowledge that the
expectation is that the Company will become a registered bank holding company with at least two
bank subsidiaries. The Founders further acknowledge and agree that each Founder will be a Founder
of the Company as well as a Founder of one of the bank subsidiaries. The Founders will be
recruited specifically to participate as a Founder of either the California Proposed Bank, the
Arizona Proposed Bank and of the Company.

     6. Records. The Co-Managers shall keep and maintain records containing:

	 	(a)	 	With respect to each deposit to the Account:

	 	(i)	 	date of deposit,
	 
	 	(ii)	 	amount deposited, and
	 
	 	(iii)	 	name of person from whom such money was accepted.

	 	(b)	 	With respect to each withdrawal from the Account:

	 	(i)	 	date of withdrawal,

	 	(ii)	 	amount of money withdrawn,
	 
	 	(iii)	 	name of person or entity to whom such money was paid,
	 
	 	(iv)	 	description of purpose of such payment, and
	 
	 	(v)	 	any invoice or billing relating to such payment.

     (c) The Co-Managers or, upon opening, each Proposed Bank, shall preserve the records
described above for a period of not less than four (4) years after such Account is closed.

     (d) The Co-Managers, the officers of the Company or the proposed officers of a Proposed
Bank, as the case may be, shall, upon request, make the records described above available
for inspection and copying by (i) the Regulators, (ii) any proposed director, officer, or
Founder of the Company or the Proposed Banks, (iii) any person from whom Pre-Opening Funds
have been accepted, (iv) the Company, or (v) the Proposed Banks, if and when chartered.

     7. Reports. On or before the 3rd Wednesday of each calendar quarter,
commencing with the calendar quarter after Pre-Opening Funds are first accepted and continuing
until the respective Account is closed in accordance with this Agreement, the Co-Managers and/or
the

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officers will provide to each person from whom Pre-Opening Funds have been accepted a report
stating, with respect to the last calendar quarter:

     (a) Opening balance of the respective Account.

     (b) Total amount deposited in the respective Account during the calendar quarter.

     (c) Itemized schedule of deposits showing, with respect to each deposit, date of
deposit, amount of money deposited, name of person from whom such money was accepted and
aggregate total amount.

     (d) Total amount disbursed from the respective Account during the calendar quarter.

     (e) An itemized schedule of disbursements showing, with respect to each person to whom
the amount disbursed, together with amounts previously disbursed to each person, is $500 or
more: name of person, amount disbursed to the person, description of purpose of such
disbursement, and the aggregate total amount disbursed to date to the person.

     (f) Closing balance of the respective Account.

     8. Circumstances Under Which Pre-Opening Funds Shall Be Repaid. 

     (a) To the extent permissible under state or federal law, the Founders understand and
agree that the Pre-Opening Funds advanced by the Founders shall be reimbursed to the
Founders, with respect to the California Founders, if, and only if, the California Proposed
Bank (i) is issued a charter to transact a commercial banking business by its respective
State Regulator or the OCC, (ii) receives approval from the FDIC of its application for
deposit insurance and (iii) subscription funds held in escrow for such Proposed Bank are
sufficient to provide such Proposed Bank with adequate capital and accordingly, have been
released; and with respect to the Arizona Founders, if, and only if, the Arizona Proposed
Bank (x) is issued a charter to transact a commercial banking business by its respective
State Regulator or the OCC, (y) receives approval from the FDIC of its application for
deposit insurance and (z) subscription funds held in escrow for the Arizona Proposed Bank
are sufficient to provide the Arizona Proposed Bank with adequate capital and accordingly,
have been released; provided, however, in the event that the Arizona Proposed Bank
ultimately does not open for business but the California Proposed Bank has opened for
business, then at the time that the Company determines to discontinue its efforts to charter
the Arizona Proposed Bank, the Company will reimburse the Arizona Founders for the
Pre-Opening Funds contributed to the organizational efforts. Upon the opening of a
subsidiary bank, the Founders will be entitled to the reimbursement of their Pre-Opening
Funds as described in this Section 8(a), and at the time of such reimbursement, the Founders
will have the option to receive a cash reimbursement of their Pre-Opening Funds, or at their
direction, to receive stock of the company rather than such cash reimbursement.

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     (b) The Co-Managers and/or the officers shall cause the Company, after making all
disbursements authorized under the terms of this Agreement, to pay any and all unencumbered
balances in the California Account, on a pro rata basis, to the Founders associated with the
California Proposed Bank upon the occurrence of any of the following events:

     (i) a majority of the Founders associated with the California Proposed Bank
determines to discontinue the efforts to charter the California Proposed Bank; or

     (ii) an application for authority to charter the California Proposed Bank filed
with the OCC, the FDIC or the State Regulator within such time is denied by the OCC,
the FDIC or the State Regulator and a reapplication for authority to charter the
California Proposed Bank is not filed with the OCC, the FDIC or the State Regulator
within 90 days after such denial.

     (c) The Co-Managers and/or the officers shall cause the Company, after making all
disbursements authorized under the terms of this Agreement, to pay any and all unencumbered
balances in the Arizona Account, on a pro rata basis, to the Founders associated with the
Arizona Proposed Bank upon the occurrence of any of the following events:

     (i) a majority of the Founders associated with the Arizona Proposed Bank
determines to discontinue the efforts to charter the Arizona Proposed Bank; or

     (ii) an application for authority to charter the Arizona Proposed Bank filed
with the OCC, the FDIC or the State Regulator within such time is denied by the OCC,
the FDIC or the State Regulator and a reapplication for authority to charter the
Arizona Proposed Bank is not filed with the OCC, the FDIC or the State Regulator
within 90 days after such denial.

     (d) Each Founder acknowledges and agrees that the return of any Pre-Opening Funds
following the removal of a Founder shall be governed by the provisions of Sections 8(b) and
8(c).

     (e) Each Founder acknowledges and agrees that there is no assurance that any of the
conditions described in this Section will be met and that if the conditions described above
do not occur, such Founder shall not be entitled to reimbursement of any of the Pre-Opening
Funds, except as expressly provided herein. Such Founder further waives any and all claims
against any other Founders hereto, the Company, the Co-Managers, the Proposed Banks and
their respective officers, directors, shareholders, attorneys, agents and representatives
for reimbursement of his or her share of Pre-Opening Funds as a result of the failure to
occur of any of the conditions described above.

     9. Application; Services. The Co-Managers are hereby authorized and directed to
execute and deliver written agreements with attorneys, accountants, economists and

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banking/fundraising consultants, relating to the various applications to be filed with the
Regulators in connection with the formation of the Proposed Banks, and for other services related
to the formation of the Company or the Proposed Banks. The Co-Managers are hereby authorized and
directed to pay, to the extent of funds made available by the Founders as described herein, all
amounts agreed to in said agreements for all such services rendered. The Founders acknowledge that
the proposed officers of each Proposed Bank will be approved by the board of directors of such
Proposed Bank.

     10. Voluntary Withdrawal. A Founder may withdraw as a Founder of the Company or the
Proposed Banks by giving written notice to the Co-Managers. Notwithstanding the foregoing, the
withdrawal of a Founder shall not affect in any manner any obligation incurred by the Founder
pursuant to this Agreement or any other agreement entered into by the Founder. Upon the withdrawal
of a Founder, the Founder shall forfeit any and all options or warrants to which the Founder would
otherwise have been entitled upon the Proposed Banks’ opening for business by virtue of his status
as a Founder, a director or executive officer or as a result of any actions taken by him pursuant
to this Agreement.

     11. Removal of Founders. A Founder associated with a Proposed Bank may be removed
with or without cause upon the vote of two-thirds of the then-active Founders associated with such
Proposed Bank.

     12. Indemnification of Co-Managers; Covenant Not to Sue. The Founders hereto agree
that the Company shall indemnify and hold the Co-Managers and the directors and officers of the
Company and the Proposed Banks harmless from any liability, obligation, claims or costs (including
attorneys, accountants, paralegal fees and expenses) incurred by them in their capacities as such
or in the course of their performance of their duties as such, except liabilities or obligations
arising from or out of willful misconduct or gross negligence. Such indemnification is limited in
amount of the Company’s resources. This indemnification obligation shall terminate upon the
termination of this Agreement. In no case will a Founder have to increase the amount advanced to
the Company for this purpose. In no event shall any Founder bring suit, initiate a mediation or
arbitration or otherwise bring a cause of action or claim against any other Founder except in the
case of gross negligence, willful misconduct or failure to make the payments or guarantees required
by Section 1 of this Agreement.

     13. Unauthorized Acts and Founder Acknowledgements. Notwithstanding anything
contained herein to the contrary, no party hereto shall be authorized in any manner or form to
perform any act or to render any communication or information with regard to the formation of the
Company or the Proposed Banks that is contrary to applicable federal and applicable state law,
including the rules, regulations and policies of the Federal Reserve, OCC, State Regulator and/or
FDIC. In addition, each Founder acknowledges the following:

     (a) that the Proposed Banks are not being chartered for the sole purpose of immediately
selling to or merging or consolidating with any other financial institution;

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     (b) that such Founder may not indicate, either orally or in writing, that he or she is
an officer or director of the Proposed Banks or that the Proposed Banks are in existence
prior to receiving the consent of the Regulators, if required at such time;

     (c) that the Proposed Banks, upon formation, will not refinance, either directly or
indirectly, any loan, advance, or credit extension made to any prospective shareholder by
any existing financial institution or other lender, if such loan, advance, or credit
extension was originally made to the prospective shareholder to obtain funds to purchase
stock in the Company or the Proposed Banks;

     (d) that all subscription funds for capital stock will be held in escrow subject to the
order of the applicable Regulators and that these funds will be released only after all
conditions precedent to the commencement of operations at a Proposed Bank have been
satisfied;

     (e) that each Proposed Bank shall commence operations at such time that sufficient
funds are held in escrow to provide the necessary capital for such Proposed Bank;

     (f) the funds raised will be allocated to each Proposed Bank at the discretion of the
Co-Managers or the Company;

     (g) that such Founder is aware that the Regulators expect the Founders to make equity
investments (pursuant to the terms and conditions of the Offering) in the common stock of
the Company and that each such Founder is expected to do so but not required to do so (the
Founders recognize that an individual’s decision to purchase shares in the offering is
personal and in the sole discretion of that Founder);

     (h) that no representations have been made by the Co-Managers, any of the Founders, any
of the other signatories hereto or attorneys, accountants or any other service providers to
the Company or the Proposed Banks guaranteeing or representing that: (a) a charter for any
of the Proposed Banks will be issued and approved by the Regulators; (b) approval of any of
the Proposed Banks by the Regulators will occur on or before any specified date or
approximate date, or that such approval will be received at all; (c) such Founder will be
approved by the Regulators as an organizing director of either the Company or the Proposed
Banks; (d) the Company will be able to successfully sell any amount of its initial capital
stock; (e) such Founder will be approved by the Regulators to purchase any specific number
of shares of the capital stock of the Company; (f) the Regulators will approve any specific
stock options, warrants or other benefit for such Founder(s); (g) the Proposed Banks will be
located in any specific location or city; or (h) the Proposed Banks will open for business
on or before any specific date or approximate date;

     (i) that there are no guarantees relating to the performance of the Company common
stock, the value of any warrants or options or the expected return on the investment by the
Founders;

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     (j) that the Founders will respect and honor the confidential nature of all information
relating to the Company, the Proposed Banks and the marketing strategy of such entities, and
that the Founders will not use any such information for any improper purpose;

     (k) that the Founders will respect and honor the confidential nature of all personal
information of each individual Founder, and that the Founders will not request copies of or
access to review any such confidential information of another Founder which information is
delivered to any consultant in connection with preparing or reviewing necessary
documentation for the Company or the Proposed Banks;

     (l) prior to the execution of this Fourth Amended and Restated Pre-Opening Funds
Agreement, Founders have left the project and received a refund of their Pre-Opening Funds;
notwithstanding that fact, it is understood that any departures after the execution of this
Agreement will be governed by the terms hereof, including the return of the Pre-Opening
Funds; and

     (m) that this Agreement cannot anticipate every decision that is or will be necessary
to the proposed transaction, and accordingly, each Founder hereby agrees that the board of
directors of the Company may make ongoing decisions relating to the Proposed Banks.

     14. Borrowings/Guarantees.

     (a) The parties understand and agree that it may be necessary for the Company to borrow
funds or otherwise secure lines of credit for the purpose of obtaining funds to pay
pre-incorporation and pre-opening expenses of the Company and the Proposed Banks and that
lenders may require such financing arrangements to be evidenced by one or more notes
co-signed or guaranteed by each of the undersigned. An agreement to borrow funds under the
provisions of this Section 14 requires the unanimous written approval of all the Founders
who undertake any such guarantee. All funds obtained pursuant to this Section 14 shall be
maintained and disbursed by the Co-Managers and/or the officers, as the case may be, in
conformity with the duties set forth in this Agreement. To the extent that a Founder is not
willing to execute any guarantee required pursuant to this Section 14, then such Founder, in
order to continue to participate in this project, must find another Founder who is willing
to provide the amount of guarantee, in whole or in part, on behalf of such Founder that is
declining to execute the guarantee.

     (b) The lines of credit obtained by the management teams working with the Proposed
Banks will be repaid using Company funds, assuming that the Company has been successful in
raising sufficient capital to fund such repayment and to provide the opening capital for at
least one of the Proposed Banks.

     (c) To the extent that a Founder joins the project after the line of credit for the
respective Proposed Bank has been obtained, then the Co-Managers shall have the authority to
waive the requirement that a Founder execute a guarantee of the line of credit

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in order to participate. Further the Co-Managers shall have the discretion to waive
the guarantee requirement under certain circumstances in which the Co-Managers determine
that it is in the best interests of the Company for a Founder to continue with the formation
process despite being unwilling or unable to provide the guarantee. In either such event,
the Founder must execute an acknowledgement that he chose to not provide the guarantee and
recognizes that he will not receive the warrants that other Founders will receive in
exchange for the at risk dollars associated with the guarantees.

     15. Termination. The Agreement shall terminate upon the occurrence of any of the
following events:

     (a) by mutual written consent of a majority of the Founders who are bound by the terms
hereof; or

     (b) following an event described in Section 8 upon the reimbursement of funds due to
Founders or upon a determination by the Co-Managers that no reimbursement shall be due.

     16. General Corporate Matters.

     (a) Initial Board of Directors. It is anticipated that the number of directors
of the Company shall be increased prior to the distribution of any offering circular or
prospectus and that the vacancies shall be filled by Founders. The board of directors
reserves the right, however, to fill any vacancies created by an increase in the number of
directors with persons who are not Founders if the board determines that the addition of
such person(s) to the board of directors of the Company would enhance the ability of the
Proposed Banks to receive regulatory approval or to operate following receipt of regulatory
approval. The board of directors of the Company shall also be empowered to identify the
individuals to serve as the proposed board of directors of the Proposed Banks. The board of
directors of the Company shall have the discretion to determine whether service by any
proposed director would impair the ability of the Proposed Banks to receive all required
regulatory approvals.

     (b) Founder Warrants. The Founders will receive warrants to purchase shares of
stock at the initial offering price. These warrants would be issued when the Proposed Bank
with which the Founder is associated opens for business, or as provided below in this
Section 16(b), and, to the extent permitted by the Regulators, would be exercisable upon
issuance and would expire ten years following the date that such Proposed Bank opened for
business. It is anticipated that each Founder would receive one warrant for every $10.00
dollars advanced to the Company by the Founder or guaranteed (on a pro rata portion of the
indebtedness basis without any consideration of any portion of the guaranty above 100%) by
the Founder for the benefit of the Company or the Proposed Banks; provided such Founder
purchases a number of shares of Company common stock equal to the warrants to be received.
Each Founder acknowledges and understands that they must purchase at least the number of
shares of stock of the Company or the Proposed Banks as they will receive warrants.

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     To the extent that a Founder provides at risk dollars to the Company for the formation
of any Proposed Bank, such Founder will be eligible to receive warrants in the Company so
long as any Proposed Bank is chartered and opened, regardless of whether such Proposed Bank
is the Proposed Bank with which such Founder was associated during the formation process and
so long as such Founder purchases shares of stock as described above in this Section 16(b).

     The board of directors of the Company shall be empowered to determine the amount of
warrants to be issued within the prescribed range, and may amend the range upon a
determination that such range would impair the ability of the Proposed Banks to receive all
required regulatory approvals or is otherwise not in the best interests of the Proposed
Banks. This grant of warrants is contingent upon the approval of the applicable Regulators
and may be reduced or eliminated as necessary to such level as may be required to obtain
such regulatory approval.

     (c) Shareholder Warrants. The initial shareholders of the Company will receive
warrants to purchase shares of stock at an exercise price of $10.00 per share. These
warrants would be issued when the Proposed Banks open for business and, to the extent
permitted by the Regulators, would be exercisable upon issuance and would expire three years
following the date that the Proposed Banks open for business. It is anticipated that each
initial shareholder would receive a minimum of one warrant for every five shares purchased
in the initial offering of stock. Notwithstanding the foregoing, the board of directors of
the Company shall be empowered to vary the amount and terms of the initial shareholder
warrants, or the very existence of initial shareholder warrants, upon a determination that
such terms or such warrants would impair the ability of the Proposed Banks to receive all
required regulatory approvals or is otherwise not in the best interests of the Company or
the Proposed Banks.

     (d) Stock Options. The board of directors of the Company believes that it is
in the best interests of the Proposed Banks to promote shareholder value by aligning the
financial interests of executive officers and employees providing services to the Proposed
Banks with long-term shareholder value. Accordingly, it is anticipated that a certain
number of shares of Company common stock will be reserved for issuance under a stock
incentive plan, which would provide, among other things, for the issuance of employee stock
options to management and future management. It is anticipated that between 10% and 15% of
the shares of stock issued in the initial public offering would be reserved for issuance of
these stock-based incentives. However, the board of directors of the Company reserves the
right to revise this amount as it determines necessary to attract and retain qualified
employees to fill positions of substantial responsibility, either current or prospective.

17. Miscellaneous.

     (a) Notices. Any notice required by this Agreement shall be given by telephone
and confirmed by facsimile, express or certified mail to the parties at the addresses
heretofore furnished by each party hereto or such other address as a party may

© Copyright 2007 — All Rights Reserved

Hunton & Williams LLP

72339.000001 EMF_US 25990890v2

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later specify. With respect to notice confirmed by facsimile, notice shall be deemed
duly given when facsimile confirmation is received. With respect to notice confirmed by
express or certified mail, notice shall be deemed duly given upon the earlier of actual
receipt of such confirmation by mail or three (3) business days after deposit in the United
States mail, postage prepaid.

     (b) Complete Agreement. This Agreement contains the entire understanding of
the parties and supersedes all existing agreements and all other oral, written or other
communications between the parties concerning its subject matter. There are no agreements,
arrangements or undertakings, oral or written, between or among the parties hereto relating
to the subject matter of this Agreement that are not fully expressed herein.

     (c) Governing Law. This Agreement shall be governed by the laws of Nevada
without regard to principles of conflicts of laws. Any dispute or controversy arising
under, out of or in connection with this Agreement, shall be determined and settled by
arbitration in Nevada in accordance with the rules of the American Arbitration Association.
Any decision rendered thereby shall be non-appealable, final and binding on the parties and
judgment may be entered thereon.

     (d) Assignment. This Agreement is personal to the parties hereto and may not
be assigned, except with respect to the Company to a successor corporate entity, including
the Proposed Banks, once established.

     (e) Amendment. This Agreement may be amended only by a writing signed by a
majority of the Founders; provided however, that any action under this Agreement requiring
the approval or consent of more than a majority may be amended only by a writing signed by
at least the same number of Founders as would be required to take such action under the
Agreement.

     (f) Waiver. Failure to insist upon strict compliance with any of the terms,
covenants or conditions hereof shall not be deemed a waiver of such term, covenant, or
condition. A waiver of any provision of this Agreement must be made in writing, designated
as a waiver, and signed by the party against who its enforcement is sought or in the case of
the Founders as a group, by a majority of the Founders. Any waiver or relinquishment of
such right or power at any one or more times shall not be deemed a waiver or relinquishment
of such right or power at any other time or times.

     (g) Illegality, Severability. If any provisions of this Agreement (or any
portion thereof) shall be held to be invalid, illegal or unenforceable, the validity,
legality or enforceability of the remainder of this Agreement shall not in any way be
affected or impaired thereby.

     (h) Counterparts. This Agreement may be executed in any number of counterparts
and each of such counterparts shall be deemed an original, and all such counterparts shall
together constitute but one and the same instrument.

12

 

     (i) Headings. The headings of sections in this Agreement are for convenience
of reference only and are not intended to qualify the meaning of any of the language in this
Agreement.

     (j) Relationship of the Founders. This Agreement shall not be deemed to create
a partnership or joint venture among the Founders or among the Company and the Founders.
Except with respect to the authorized acts of the Co-Managers, as expressly described in
this Agreement, no Founder shall be authorized or have the right to bind or obligate any
other Founder to any debt, obligation or liability with any third party without the prior
written consent of all of the other Founders.

[Remainder of Page Intentionally Left Blank]

13

 

     IN WITNESS WHEREOF, the undersigned parties have executed this Agreement and agree to be bound
by the terms hereof.

	 	 	 	 	 
	 	UNITED BUSINESS HOLDINGS, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:	 	 
	 

	 	 	 	 	 
	 	FOUNDERS

 	 
	 	 	 
	 
	 	Name:  	 	 

 	 	 	 	 	 
	 
	 	 	 
	 
	 	Name:  	 	 

 	 	 	 	 	 
	 
	 	 	 
	 
	 	Name:  	 	 

 	 	 	 	 	 
	 
	 	 	 
	 
	 	Name:  	 	 

 	 	 	 	 	 
	 
	 	 	 
	 
	 	Name:  	 	 

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16exv10w25

EXHIBIT 10.25

FIRST AMENDMENT TO

CREDIT AGREEMENT

          This Amendment is agreed to as of October 3, 2008, by and among First Interstate BancSystem,
Inc., a Montana corporation (the “Borrower”), Wells Fargo Bank, National Association, a national
banking association, in its capacity as administrative agent under the Credit Agreement described
below (in such capacity, the “Administrative Agent”), and the other financial institutions party to
the Credit Agreement described below (in such capacity, the “Lenders”).

          The Borrower, the Administrative Agent and the Lenders are parties to a Credit Agreement dated
January 10, 2008 (together with all amendments, modifications and restatements thereof, the “Credit
Agreement”).

          The parties wish to (i) reduce the revolving line of credit under the Credit Agreement,
(ii) modify certain financial covenants, and (iii) waive certain defaults under the Credit
Agreement.

          ACCORDINGLY, in consideration of the mutual covenants contained in the Credit Agreement and
herein, the parties hereby agree as follows:

          1. Definitions. All terms defined in the Credit Agreement that are not otherwise
defined herein shall have the meanings given them in the Credit Agreement.

          2. Amendments. The Credit Agreement is hereby amended as follows:

     (a) The definition of “Aggregate Revolving Commitment Amount” is hereby amended in its
entirety to read as follows:

     “Aggregate Revolving Commitment Amount” means $15,000,000, constituting
the sum of the Revolving Commitments of all Lenders, subject to adjustment
in accordance with Section 2.12.

     (b) Section 5.12 of the Credit Agreement is hereby amended in its entirety to read as
follows:

     Section 5.12 Allowance for Loan and Lease Losses.

The Borrower will maintain its allowance for loan and lease losses,
determined for the Borrower and its Subsidiaries on a consolidated basis, at
all times on or after September 30, 2008 in an amount not less than the
Specified Percentage of Non-Performing Loans. As used in this Section 5.12,
“Specified Percentage” means, with respect to any date of determination, the
percentage set forth below opposite the period in which such date of
determination occurs:

 

 

	 	 	 	 	 
	 	 	Specified
	Period	 	Percentage
	September 30, 2008 through March 30, 2009
	 	 	75	%
	March 31, 2009 through June 29, 2009
	 	 	80	%
	June 30, 2009 through September 29, 2009
	 	 	85	%
	September 30, 2009 through December 30, 2009
	 	 	90	%
	December 31, 2009 and thereafter
	 	 	100	%

     (c) Section 5.14 of the Credit Agreement is hereby amended in its entirety to read as
follows:

     Section 5.14 Maximum Non-Performing Assets.

The Borrower will maintain its ratio of Non-Performing Assets to Primary
Equity Capital, expressed as a percentage and determined with respect to the
Borrower and its Subsidiaries on a consolidated basis as of the end of each
calendar quarter, commencing September 30, 2008, at not less than the
applicable percentage set forth below opposite the period in which such
quarter-end occurs:

	 	 	 	 	 
	Period	 	Percentage
	September 30, 2008 through June 29, 2009
	 	 	17.5	%
	June 30, 2009 and thereafter
	 	 	15.0	%

     (d) Exhibit A to the Credit Agreement is hereby deleted, and Exhibit A to this
Amendment is substituted therefor.

     (e) Exhibit B to the Credit Agreement is hereby deleted, and Exhibit B to this
Amendment is substituted therefor.

          3. Waiver of June 30, 2008 Financial Covenant Defaults. As used in this Section 3,
“Specified Defaults” means the defaults described below, and any Event of Default arising under
Section 7.1(c) or 7.1(d) of the Credit Agreement on account of any such breach:

	 	(x)	Sections 5.12 and 5.14 of the Credit Agreement (prior to the amendment set
forth above) required that the Borrower maintain its allowance for loan and lease
losses at not less than 100% of Non-Performing Loans, and that the Borrower maintain
its Non-Performing Assets at an amount not more than 15% of Primary Equity Capital. In
fact, the Borrower was in default of each of those Sections as of June 30, 2008.
	 
	 	(y)	The Borrower has made certain Restricted Payments that, solely because of the
Event of Default described in paragraph (x) above, constitute a breach of Section 6.4
of the Credit Agreement and accordingly constitute an Event of Default under Section
7.1(d) of the Credit Agreement.

However, the Lenders entering into this Amendment hereby waive (i) the Specified Defaults, and
(ii) the right to increase the rate of interest applicable to the Loans under Section 2.6(d) of the

-2-

 

Credit Agreement on account of the Specified Defaults. This waiver shall be effective only in this
specific instance and for the specific purpose for which it is given, and this waiver shall not
entitle the Borrower to any other or further waiver in any similar or other circumstances. Without
limiting the generality of the foregoing, the Lenders entering into this Amendment are not waiving
their right to increase the rate of interest applicable to the Loans under Section 2.6(d) of the
Credit Agreement on account of any future breach of Section 5.12, 5.14 or 6.4 of the Credit
Agreement.

          4. Waiver and Amendment Fee. On the date hereof, the Borrower shall pay the
Administrative Agent, for the ratable benefit of each Lender that has executed and delivered this
Amendment prior to 10:00 a.m. (Central time) on the date hereof (each, a “Consenting Lender”), an
amendment fee in an amount equal to 0.10% of the sum of (i) such Consenting Lender’s Revolving
Commitment, determined after giving effect to this Amendment, and (ii) such Consenting Lender’s
Term Credit Exposure as of the date hereof. Such fee shall be deemed fully earned by the
Consenting Lenders on the date hereof by their entering into this Amendment, whether or not the
conditions set forth in Section 6 are satisfied.

          5. Representations and Warranties. The Borrower hereby represents and warrants to the
Administrative Agent and the Lenders as follows:

     (a) The Borrower has all requisite power and authority, corporate or otherwise, to
execute and deliver this Amendment and to perform all of its obligations under this
Amendment and the Credit Agreement as amended hereby. This Amendment has been duly and
validly executed and delivered to the Administrative Agent by the Borrower, and this
Amendment and the Credit Agreement as amended hereby constitute the Borrower’s legal, valid
and binding obligations enforceable in accordance with their terms.

     (b) The execution, delivery and performance by the Borrower of this Amendment, and the
performance of all of the Borrower’s obligations under the Credit Agreement as amended
hereby, have been duly authorized by all necessary corporate or partnership action and do
not and will not (i) require any authorization, consent or approval by any governmental
department, commission, board, bureau, agency or instrumentality, domestic or foreign,
(ii) violate the Organizational Documents of the Borrower, or any provision of any law,
rule, regulation or order presently in effect having applicability to the Borrower, or
(iii) result in a breach of or constitute a default under any indenture or agreement to
which the Borrower is a party or by which the Borrower or any properties of the Borrower may
be bound or affected.

     (c) All of the representations and warranties contained in Article IV of the Credit
Agreement are correct on and as of the date hereof as though made on and as of such date,
except to the extent that such representations and warranties relate solely to an earlier
date.

          6. Conditions; Effective Date. The amendments set forth in Section 2 and the waiver
set forth in Section 3 shall be effective only if the Administrative Agent has received
(or waived the receipt of), on or before the date hereof (or such later date as the
Administrative Agent may agree to in writing), (i) this Amendment, duly executed by the Borrower
and the

-3-

 

Required Lenders, and (ii) the fee set forth in Section 4. Notwithstanding the foregoing,
upon satisfaction of the conditions set forth in this Section 6, the amendments set forth in
paragraphs (b) and (c) of Section 2 shall be deemed to have become effective as of September 30,
2008.

          7. Miscellaneous. The Borrower shall pay all costs and expenses of the Administrative
Agent, including attorneys’ fees, incurred in connection with the drafting and preparation of this
Amendment and any related documents. Except as amended by this Amendment, all of the terms and
conditions of the Credit Agreement shall remain in full force and effect. This Amendment may be
executed in any number of counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which counterparts of this Amendment, taken together, shall
constitute but one and the same instrument. This Amendment shall be governed by the substantive
law of the State of Minnesota.

Signature pages follow

-4-

 

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the
date first above written.

	 	 	 	 	 
	 	FIRST INTERSTATE BANCSYSTEM, INC.

 	 
	 	By:  	/s/ TERRILL R. MOORE
 	 
	 	 	Name:  	Terrill R. Moore 	 
	 	 	Title:  	Executive Vice President and Chief Financial Officer 	 
	 

Signature page to First Amendment to First Interstate BancSystem, Inc. Credit Agreement

 

 

	 	 	 	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,

     as Administrative Agent and Lender

 	 
	 	By:  	/s/ DAVID SCHMALTZ
 	 
	 	 	Name:  	David Schmaltz 	 
	 	 	Title:  	Vice President 	 
	 

Signature page to First Amendment to First Interstate BancSystem, Inc. Credit Agreement

 

 

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ MORGAN C. FARMER
 	 
	 	 	Name:  	Morgan C. Farmer 	 
	 	 	Title:  	Assistant Vice President 	 
	 

Signature page to First Amendment to First Interstate BancSystem, Inc. Credit Agreement

 

 

	 	 	 	 	 
	 	FIRST TENNESSEE BANK, NATIONAL ASSOCIATION
 	 
	 
	 	By:  	/s/ WADE RHEA
 	 
	 	 	Name:  	Wade Rhea 	 
	 	 	Title:  	Vice President 	 
	 

Signature page to First Amendment to First Interstate BancSystem, Inc. Credit Agreement

 

 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
 	 
	 
	 	By:  	/s/ AMIN ALAKKAD
 	 
	 	 	Name:  	Amin Alakkad 	 
	 	 	Title:  	Vice President 	 
	 

Signature page to First Amendment to First Interstate BancSystem, Inc. Credit Agreement

 

 

Exhibit A

COMMITMENTS AND ADDRESSES

	 	 	 	 	 
	Name	 	Commitment Amounts	 	Notice Address
	First Interstate BancSystem, Inc.
	 	N/A	 	First Interstate BancSystem, Inc.
	 
	 	 	 	401 N. 31st Street
	 
	 	 	 	Suite 1800
	 
	 	 	 	Billings, MT  59101
	 
	 	 	 	Attention: Terrill R. Moore
	 
	 	 	 	Facsimile: 406-255-5350
	 
	 	 	 	E-mail: tmoore@fib.com
	 
	 	 	 	 
	Wells Fargo Bank, National
	 	N/A	 	Wells Fargo Bank, National
	Association, as
	 	 	 	     Association
	Administrative Agent
	 	 	 	MAC C7301-02E
	 
	 	 	 	2nd Floor
	 
	 	 	 	1740 Broadway
	 
	 	 	 	Denver, CO 80274-0001
	 
	 	 	 	Attention: Cynthia M Spagnola
	 
	 	 	 	Facsimile: 303-863-4909
	 
	 	 	 	E-mail: spagnoc@wellsfargo.com
	 
	 	 	 	 
	Wells Fargo Bank, National
	 	Revolving Commitment:	 	Wells Fargo Bank, National
	Association, as a Lender
	 	     $5,526,315.78	 	           Association
	 
	 	Term Commitment:	 	MAC C7301-02E
	 
	 	     $18,421,052.63	 	2nd Floor
	 
	 	 	 	1740 Broadway
	 
	 	 	 	Denver, CO 80274-0001
	 
	 	 	 	Attention: Cynthia M Spagnola
	 
	 	 	 	Facsimile: 303-863-4909
	 
	 	 	 	E-mail: spagnoc@wellsfargo.com
	 
	 	 	 	 
	U.S. Bank National Association
	 	Revolving Commitment:	 	U.S. Bank National Association
	 
	 	     $3,157,894.74	 	EP-MN-S9CB
	 
	 	Term Commitment:	 	101 E. 5th Street
	 
	 	     $10,526,315.79	 	St. Paul, MN 55101
	 
	 	 	 	Attention: Steve Moore
	 
	 	 	 	Facsimile: 651-466-8270
	 
	 	 	 	E-mail: steve.moore@usbank.com

 

 

	 	 	 	 	 
	Name	 	Commitment Amounts	 	Notice Address
	First Tennessee Bank, National
	 	Revolving Commitment:	 	First Tennessee Bank, National
	Association
	 	     $3,157,894.74	 	         Association
	 
	 	Term Commitment:	 	845 Crossover Lane, Suite 150
	 
	 	     $10,526,315.79	 	Memphis, TN 38117
	 
	 	 	 	Attention: Wade Rhea
	 
	 	 	 	Facsimile: 901-435-7983
	 
	 	 	 	E-mail: wade.rhea@ftnfinancial.com
	 
	 	 	 	 
	JPMorgan Chase Bank, National
	 	Revolving  Commitment:	 	JPMorgan Chase Bank, National
	Association
	 	     $3,157,894.74	 	                            Association
	 
	 	Term Commitment:	 	10 S. Dearborn, Mailcode IL1-1235
	 
	 	     $10,526,315.79	 	Chicago IL 60603-2003
	 
	 	 	 	Attention: Amin AlAkkad
	 
	 	 	 	Facsimile: 312-732-7002
	 
	 	 	 	E-mail: amin.alakkad@chase.com

 

 

Exhibit B

Pricing Grid

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Summary Criteria	 	LIBO Rate	 	Floating Rate	 	Commitment
	Level	 	(Funded Debt Ratio)	 	Margin	 	Margin	 	Fee
	I	 	< 1.00
	 	 	1.625	%	 	 	0.125	%	 	 	0.25	%
	II	 	3  1.00 but < 2.00
	 	 	1.750	%	 	 	0.250	%	 	 	0.30	%
	III	 	3  2.00
	 	 	1.875	%	 	 	0.375	%	 	 	0.35	%

          “Level I Status” exists if, as of the date of determination, the Funded Debt Ratio of the
Borrower and its Subsidiaries is less than 

1.00 to 1.

          “Level II Status” exists if, as of the date of determination, the Funded Debt Ratio of the
Borrower and its Subsidiaries is 1.00 to 1 or greater, but less than 2.00 to 1.

          “Level III Status” exists if, as of the date of determination, the Funded Debt Ratio of the
Borrower and its Subsidiaries is 2.00 to 1 or greater.

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