Document:

Unassociated Document

     

    CLOSED-END
      LINE OF CREDIT AGREEMENT

    

    THIS
      AGREEMENT is dated as of March 27, 2008 between AMB FINANCIAL CORPORATION,
      an
      Indiana corporation with its principal place of business at 8230 Hohman Avenue,
      Munster, Indiana 46321 (''Company''), and Lenders signatory hereto (individually
      ''Lender'' and collectively ''Lenders'').

    

    Company
      and Lenders agree as follows: 

    

    Article
      I Closed-end Line of Credit

    

    1.
      Each
      Lender hereby establishes a Closed-end Line of Credit (“Term Loan”) in favor of
      Company on the terms hereof in an aggregate principal amount at any one time
      outstanding not exceeding its proportionate share of $2,000,000.00. The Term
      Loan ultimately obtained may be in an amount equal to or less than the total
      committed credit sum of $2,000,000.00, and the amount ultimately borrowed shall
      be divided among Lenders in proportion to the percentage set forth opposite
      each
      Lender's signature hereto (''Lender's Commitment''). 

     

    

    2.
      At the
      time of availing itself of the Term Loan, Company shall execute and deliver
      to
      each Lender a note (“Term Note'') payable to the order of each Lender for the
      amount of its respective loan to Company. The Term Notes shall be in the form
      of
      ''Exhibits 1 and 2'' attached hereto, with blanks suitably filled, shall be
      dated the date of the borrowing, and shall mature on or before March 31, 2013.
      The rate of interest before maturity shall be at a rate of eight percent per
      annum (8%) (computed on a 365-day basis). Accrued interest shall be payable
      monthly, on the last business day of each month starting with the month
      following the month during which the funds are actually advanced to Company.
      

     

    3.
      This
      Closed-end Line of Credit Agreement and any and all corresponding Term Notes
      to
      be executed pursuant hereto are secured by a Collateral Pledge Agreements of
      even date herewith, pledging to each Lender a security interest in approximately
      one-half (1/2) of all of the 1,124,125 shares of AMERICAN SAVINGS, FSB stock
      (the subsidiary of AMB FINANCIAL CORP.) that are owned by Company, identified
      as
      CUSIP #1. Said share certificate shall be returned to Company, retired and
      re-issued in two (2) separate certificates in the name of AMB FINANCIAL
      CORPORATION, with 562,062 of the shares to be issued in a separate certificate
      issued in the name of AMB FINANCIAL CORPORATION, but pledged as collateral
      security to Lender George Novogroder, and with the remaining 562,023 shares
      to
      be issued in a separate certificate issued in the name of AMB FINANCIAL
      CORPORATION, but pledged as collateral security to Lender First
      Regional Bank, custodian FBO Clement B. Knapp, Jr. IRA. The stock certificates
      for said shares, together with executed stock powers, in the form of “Exhibits 3
      and 4” attached hereto, shall be held in safekeeping under a Tri-Party Escrow
      Agreement with an escrow agent to be determined upon mutual agreement of the
      Company and Lenders.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    Article
      II Right to Terminate or Reduce Term Loan 

    

    1.
      Company may at any time terminate or reduce the Term Loan hereby created,
      without penalty or premium, by giving written notice to each of Lenders and
      by
      payment of all or a portion of the principal balance of the Term Notes
      outstanding hereunder, in either case with payment to be applied first to any
      accrued interest, with the balance to be applied to the principal on said Term
      Notes. 

     

    2.
      Any
      reduction of the Term Loan shall apply to the commitments of Lenders
      proportionately, and Company may not terminate the commitment of one Lender
      without terminating the commitment of the other Lender. All payments of
      principal or interest by Company on the Term Notes shall be made ratably on
      the
      indebtedness owing to each Lender. 

     

    Article
      III Provisions Relative to Borrowing and Payments 

     

    1.
      Each
      borrowing from Lenders hereunder shall be made pro rata according to their
      respective commitments and on the same date. Each payment and prepayment of
      the
      Revolving Credit Notes shall be made pro rata in accordance with the principal
      amounts of such notes. 

    

    Article
      IV Representations and Warranties

     

    Company
      represents and warrants that: 

     

    1.
      The
      2007 audited financial statements of Company and its subsidiaries heretofore
      furnished to each Lender, are complete and correct and fairly present the
      consolidated financial condition of Company and its subsidiaries as of the
      date
      of said statements. To the best of Company's knowledge and belief, neither
      Company nor any subsidiary has any material or substantial contingent obligation
      or liability for taxes not disclosed by or reserved against in said statements
      or in other public information regarding the Company or American Savings, FSB..
      

     

    2.
      Company has full power and authority to execute and perform the terms and
      provisions of this Agreement and to borrow hereunder. 

     

    3.
      The
      1,124,125 shares of American Savings, FSB Stock represents 100% of the issued,
      authorized and outstanding stock of American Savings, FSB. 

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

    Article
      V Affirmative Covenants

    

    1.
      Company covenants and agrees that until all indebtedness incurred hereunder
      has
      been paid in full and Company no longer has the right to borrow hereunder,
      it
      will: 

     

    (a)
      Furnish to each Lender, not later than 90 days after the end of each fiscal
      year, a consolidated profit and loss statement and statement of surplus of
      Company and its subsidiaries for such year and a consolidated balance sheet
      of
      Company and its subsidiaries as of the last day of such fiscal year, certified
      by independent public accountants in accordance with GAAP;

     

    (b)
      From
      time to time furnish to each Lender all financial information, including proxy
      statements, furnished by Company to its shareholders; 

     

    (c)
      With
      reasonable promptness, furnish to each Lender all additional financial
      statements and data and information concerning the financial condition of
      Company and its subsidiaries reasonably requested by any Lender; provided,
      however, that no provision of this Article V, Section 1, shall require Company
      to give any Lender any information which it is prohibited from giving individual
      Lenders by any governmental regulation; 

     

    (d)
      At
      all times keep its property insured against loss or damage to the extent and
      against the risks that similar property is usually insured by other companies
      engaged in the same business, and will cause its subsidiaries so to do; and
      

     

    (e)
      Promptly pay and discharge or extend in accordance with law, and cause its
      subsidiaries to pay and discharge or extend in accordance with law, all taxes
      and assessments levied and assessed or imposed upon its property or upon its
      income as well as all claims which, if unpaid, might by law become a lien or
      charge upon its property. Nothing herein contained, however, shall require
      Company or any subsidiary to pay any such taxes, assessments or claims so long
      as Company or such subsidiary in good faith contests the validity and stays
      the
      execution and enforcement thereof. 

     

    2.
      Lenders covenant and agree that they will keep all non-public information they
      receive from the Company and its subsidiaries confidential until such
      information otherwise becomes public due to the actions of parties other than
      Lenders or persons to whom they directly or indirectly disclosed the subject
      information. Lenders further agree that they will not (i) utilize any non-public
      information they receive from the Company and its subsidiaries for any reason
      other than monitoring the Company’s compliance with this Agreement, (ii) utilize
      any non-public information they receive from the Company or its subsidiaries
      in
      any manner prohibited by law or regulation, (iii) trade any of the Company’s or
      its subsidiaries’ securities based on material non-public information, or (iv)
      tip others who then so trade.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    Article
      VI Events of Default

    

    The
      following shall constitute Events of Default under this Agreement: (a) Company
      defaults in the payment of any principal on any Term Note created hereunder
      when
      it becomes due, either under the terms of the note or otherwise as provided
      herein; (b) Company defaults in the payment of any interest on any Term Note
      created hereunder for more than 15 days after the due date; (c) any material
      representation or warranty made by Company herein or in any writing furnished
      in
      connection with or pursuant to the Agreement is false in any material respect
      on
      the date made; (d) Company defaults in the performance or observance of any
      other agreement, term, or condition contained herein, and such default is not
      remedied within 30 days after Company receives written notice thereof from
      the
      holder or holders of the Term Notes outstanding at the time; (e) Company or
      a
      subsidiary makes an assignment for the benefit of creditors; (f) Company or
      a
      subsidiary petitions or applies to any tribunal for the appointment of a trustee
      or receiver, either of it or of a substantial part of its assets, or commences
      any proceedings relating to it under any Bankruptcy, reorganization,
      arrangement, insolvency, readjustment of debt, dissolution, or liquidation
      law
      of any jurisdiction; (g) any such petition or application is filed, or any
      such
      proceedings are commenced, against Company or a subsidiary, and Company or
      such
      subsidiary by any act indicates its approval, consent, or acquiescence, or
      an
      order is entered appointing such trustee or receiver, adjudicating Company
      or a
      subsidiary Bankrupt or insolvent, or approving the petition in any such
      proceedings, and such order remains in effect for more than 90 days; or (h)
      an
      order is entered in any proceedings against Company, or a subsidiary of Company,
      decreeing its dissolution or split-up, and such order remains in effect for
      more
      than 90 days. If any one or more of the above Events of Default occur and
      continue, the Lenders may, by written notice to Company, declare all of the
      notes to be, and all of the notes shall thereupon be and become, immediately
      due
      and payable, together with interest accrued thereon. If the Company defaults
      on
      a Term Note, the affected Lender shall be entitled to vote the pledged shares
      on
      all corporate questions so long as Company shall remain in default, but only
      to
      the extent permitted by applicable law and regulations, including Part 574
      of
      the OTS Regulations, with Company retaining the remaining voting rights.

     

    Article
      VII Definitions

    

    For
      the
      purpose of this Agreement, the following terms shall have the following
      meanings: 

     

    1.
      ''Person'' shall mean and include an individual, a partnership, a limited
      liability company, a corporation, a trust, an unincorporated organization,
      and a
      government or any department or agency thereof; 

     

    2.
      ''Subsidiary'' shall mean any corporation organized under the laws of any state
      of the United States of America, Puerto Rico, Canada, or any province of Canada,
      a majority of the voting stock of which shall, at the time as of which any
      determination is being made, be owned by Company, either directly or through
      subsidiaries; 

     

    3.
      ''Event of default'' shall mean any event specified in Article VI, provided
      that
      every requirement in connection with such event for the giving of notice, the
      lapse of time, or the happening of any further condition, event or act has
      been
      satisfied. ''Default'' shall mean any of such events, regardless of whether
      any
      such requirement has been satisfied; 

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    Article
      VIII Miscellaneous

    

    1.
      This
      Agreement may be amended, and Company may take any action herein prohibited,
      or
      omit to perform any act herein required to be performed, if it obtains the
      prior
      written consent of all holders of the Term Notes at the time outstanding to
      such
      amendment, action, or omission to act. Each holder of any note shall be bound
      by
      any consent authorized by this Section 1. 

    

    2.
      All
      representations and warranties contained herein or made in writing by Company
      in
      connection herewith shall survive the execution and delivery of this Agreement
      and of the notes. 

     

    3.
      All
      covenants and agreements in this Agreement contained by or on behalf of either
      party shall bind and inure to the benefit of its respective successors and
      assigns. Furthermore, the rights and responsibilities of all parties under
      this
      Agreement are not assignable without the express written consent of all parties
      hereto, subject to applicable law and regulations.

     

    4.
      All
      communications provided for hereunder shall be sent by us, Certified Mail and,
      if to Lenders, addressed in the manner indicated underneath their signatures
      to
      this Agreement, and, if to Company, to its offices at 8230 Hohman Avenue,
      Munster, Indiana 46321, attention of President or Chief Financial Officer,
      or to
      any other address of which either party notifies the other in writing.

     

    5.
      No
      delay or failure by Lenders to exercise any right or remedy under this
      Agreement, and no partial or single exercise of that right, shall constitute
      a
      waiver of that or any other right, unless otherwise expressly provided herein.
      The rights and remedies expressly specified herein are cumulative and not
      exclusive of Lenders' other rights and remedies. 

     

    6.
      This
      Agreement shall terminate when Company no longer has the right to borrow
      hereunder and all notes issued pursuant hereto have been paid in full, provided
      that, if all Term Notes have been paid in full, the Company shall have the
      right
      to unilaterally terminate this Agreement including all the restrictions
      hereunder. 

     

    7.
      This
      Agreement may be executed in any number of copies and by the different parties
      hereto on separate counterparts. Complete sets of counterparts executed by
      all
      of the parties shall be filed with Company. 

    

    The
      parties hereto have caused this Agreement to be duly executed by their
      respective duly authorized officers as of the day and year first above written.
      

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    
      	
              LENDER’S
                NAME & ADDRESS

            	 	
              PARTICIPATION
                PERCENTAGE

            
	 	 	 
	 	 	 
	
               
                

            	 	
               

            
	
              
                 
                  

              

            	 	
              50%

            

    

      

    
      	 	 	 
	
              First
                Regional Bank, custodian FBO Clement B.

            	
              50%

            	
               

            
	
              Knapp,
                Jr. IRA

            	 	 
	
              _____________________________[signature]

            	 	 
	
              Printed
                Name:____________________

            	 	 
	
              Title:___________________________

            	 	 
	
              Address:
                P.O. Box 85410, San Diego, CA 92186-5410

            	 	 
	
              AMB
                FINANCIAL CORPORATION (Company)

            	 	 
	 	 	 
	 	 	 
	
              By:                        

            	 	 
	
                 President

            	 	 
	 	 	 
	 	 	 
	
              By:                        

            	 	 
	
                 Vice
                President

            	 	 

    

    

    ACKNOWLEDGEMENT
      OF PLEDGE: 

    

    American
      Savings, FSB acknowledges and consents to the pledge of its stock as set forth
      hereinabove, and further represents and warrants to the Lenders that it will
      not
      cause any additional stock to be authorized and/or issued until the Closed-End
      Line of Credit facility is paid in full.

    

    AMERICAN
      SAVINGS, FSB 

     

    By:
      _____________________________ 

    Printed
      Name:_____________________ 

    Title:_____________________________

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      2

    Term
      Note

     

    $1,000,000.00
      [amount
      of note
      ]

     

    Munster,
      Indiana 

     

    ___________________
      [date
      ]

     

    No.
      ___________________ 

    Borrower/Corporation:
      AMB Financial Corporation 

    Holder/Lender:
      First Regional Bank, custodian FBO Clement B. Knapp, Jr. IRA 

    Holder/Lender’s
      Address: Address:
      P.O. Box 85410, San Diego, CA 92186-5410

    Interest
      Rate: Eight Percent (8%) per annum 

    Promissory
      Note Due: March 31, 2013 

    

    Obligation

     

    1.
      AMB
      Financial Corporation (the ''Corporation''), an Indiana corporation, for value
      received, promises to pay to First Regional Bank, custodian FBO Clement B.
      Knapp, Jr. IRA, on or before March 31, 2013, the principal sum of $ 1,000,000.00
      and to pay interest on the principal sum from the date of this Note at the
      rate
      of Eight percent (8%) per annum until the principal is paid in full. Interest
      payments will be made monthly on the last business day of each month, starting
      with the first calendar month following the month in which the loaned funds
      are
      advanced to Borrower. 

    

    Medium
      of Payment

     

    2.
      The
      principal and interest on this Note are payable in lawful money of the United
      States by direct deposit into an account to be designated by Lender, or at
      such
      other office of the Corporation as it may from time to time designate.

    

    Redemption--Straight
      Method

     

    3.
      This
      Note shall be redeemable at the option of the Corporation, in whole or in part,
      at any time after the giving of appropriate notice. The redemption price for
      this Note shall be the principal amount of the Note plus interest accrued to
      the
      date fixed for redemption. This Note shall become due and payable and shall
      cease to bear interest on the date fixed for redemption, and the amount then
      payable to the holder shall be paid on the surrender of this Note to the
      Corporation. 

     

    Notice
      of Redemption to Registered Holder

    

    4.
      Prior
      to redemption, the Corporation shall notify any registered holder of this Note
      of its intention to redeem and of the redemption date at least ten (10) days
      prior to the date, by registered mail addressed to the registered holder at
      his
      or her last address as it appears on the registration books of the Corporation.
      After the giving of the notice, the liability of the Corporation for interest
      on
      this Note shall cease on the date of redemption fixed in the notice, unless
      the
      Corporation fails to redeem this Note when it is presented for redemption on
      or
      after the redemption date. 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Default

     

    5.
      Without notice, except as expressly provided in this Note, the following will
      be
      deemed events of default: 

    

    Interest

     

    a.
      Failure to pay any installment of interest on this Note when due, if the failure
      to pay continues for a period of fifteen (15) days. 

    

    Principal

     

    b.
      Failure to pay the principal of this Note as and when it becomes due and
      payable, either at maturity or on redemption. 

    

    Covenants

     

    c.
      Failure on the part of the Corporation to observe or perform any of the
      covenants contained in this Note, but only after written notice of the failure
      has been given to the Corporation by the registered holder, and only if the
      failure has continued unremedied for at least thirty (30) days after the date
      the Corporation receives the notice of default. 

    

    Insolvency

     

    d.
      A
      decree or order of a court adjudging the Corporation bankrupt or insolvent,
      or
      approving a petition seeking reorganization of the Corporation under the
      Bankruptcy Code, if the decree or order has continued undischarged or unstayed
      for a period of ninety (90) days. 

    

    Receivership

     

    e.
      A
      decree or order of a court for the appointment of a receiver, liquidator, or
      trustee for the Corporation, for a sale of all or substantially all of its
      property, or for the winding-up or liquidation of its affairs; but only if
      the
      decree or order has continued in force undischarged or unstayed for a period
      of
      ninety (90) days. 

    

    Bankruptcy

     

    f.
      Any of
      the following actions by the Corporation:

    

    (1)
      Institution of voluntary bankruptcy proceedings, consent to the filing of
      bankruptcy proceedings, or proceedings relating to reorganization under the
      Bankruptcy Code; 

    

    (2) Consent
      to the appointment of a receiver, liquidator, or trustee;

     

    (3) Making
      a
      general assignment for the benefit of creditors;

     

    (4) Admission
      in writing of its inability to pay its debts as they become due.

    

    Acceleration
      of Maturity

     

    6.
      If any
      one or more events of default occur, the registered holder of this Note at
      that
      time may declare the principal and all accrued interest on this Note then
      outstanding immediately due and payable, by notice in writing to the
      Corporation. At any time within twenty (20) days after the notice, the
      registered holder of this Note may rescind the declaration of acceleration
      and
      waive the default by written notice to the Corporation. During any time that
      the
      Borrower remains in default as defined hereinabove, interest on the principal
      balance shall be charged at a rate of ten percent (10%) per annum until the
      default is cured.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Payment
      on Acceleration

     

    7.
      On any
      acceleration of the maturity of this Note, and if there has been no rescission
      of that acceleration, the Corporation shall, within sixty (60) days, pay the
      entire principal unpaid balance together with accrued interest to the date
      of
      payment. If the Corporation fails to make payment, the holder of this Note
      shall
      be entitled to take any and all legal and/or equitable remedies available under
      applicable law to enforce the obligations of the Corporation. In the event
      that
      suit is brought to enforce payment and final judgment is entered in favor of
      the
      holder, the Corporation promises to pay to Lender all costs of collection and
      reasonable attorneys' fees to be fixed by the court. 

    

    Notices

     

    8.
      Any
      communication or notices required by this Note shall be delivered or mailed
      to
      the offices of the Corporation shown above, and to the registered holder of
      this
      Note at the address for Holder/Lender shown above. Either the Corporation or
      the
      registered holder may change the address designated for receipt of notices
      by
      written notice of the change to the other party. 

    

    Construction

     

    9.
      This
      Note is to be construed in accordance with the laws of the State of
      Indiana.

    
 

    Executed
      on ___________________ [date],
      at
      Munster, Indiana.

    

    AMB
      FINANCIAL CORPORATION (Borrower)

     

    By:________________________

    Title:_______________________
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      4

     

    
      STOCK
        POWER -
        KNAPP

       

      For
        full
        and adequate consideration received, AMB Financial Corporation, an Indiana
        corporation, hereby sells, assigns and transfers to First Regional Bank,
        custodian FBO Clement B. Knapp, Jr. IRA 562,063 shares of common stock of
        American Savings, FSB, represented by Stock Certificate Number __, a copy
        of
        which is attached hereto and marked as Exhibit A, now registered in the name
        of
        AMB Financial Corporation on the books of American Savings, FSB, being Share
        Certificate Number __, and hereby irrevocably constitutes and appoints the
        Secretary and/or authorized officer of American Savings, FSB, agent and attorney
        to transfer the aforesaid stock on the books of American Savings, FSB, to
        First
        Regional Bank, custodian FBO Clement B. Knapp, Jr. IRA, with full power of
        substitution in the premises. 

       

       

      Dated:
        March __, 2008 

       

       

      AMB
        Financial Corporation, an Indiana corporation 

       

      
        	
                By:

              	 	  
	 
	 	
                Name:

              	  
	 
	 	
                Its:

              	
                President

              	 

      

       

      

       

      
        	
                By:

              	 	  
	 
	 	
                Name:

              	  
	 
	 	
                Its:

              	
                Vice
                  President

              	 

      

       

      

       

      
        	
                STATE
                  OF INDIANA

              	
                )

              	 
	 	
                )
                  ss:

              	 
	
                COUNTY
                  OF LAKE

              	
                )

              	 

      

       

      Before
        me, a Notary Public in and for said county and state, personally appeared
        , the
        President of AMB Financial Corporation, and , the Vice President of AMB
        Financial Corporation, and acknowledged that they executed the same in their
        authorized capacities, and that by their signatures on this instrument, the
        entity upon behalf of which the persons acted has executed this instrument.
        

       

      
        	 	  

	 	
                Notary
                  Public

              
	 	 
	
                My
                  Commission Expires:Unassociated Document

    COLLATERAL
      PLEDGE AGREEMENT (Knapp)

     

    THIS
      AGREEMENT is made March 27, 2008, between AMB FINANCIAL CORPORATION
      (''Pledgor''), and First Regional Bank, custodian FBO Clement B. Knapp, Jr.
      IRA,
P.O.
      Box
      85410, San Diego, CA 92186-5410
      (''Pledgee'').

     

    Recitals:

      

    At
      the
      time of the execution of this agreement, Pledgee loaned Pledgor $1,000,000.00
      evidenced by Pledgor's Term Note for such amount.

     

    To
      induce
      Pledgee to make the loan, Pledgor has agreed to pledge certain stock with
      Pledgee as security for the repayment of the loan,

     

    It
      is
      therefore agreed:

     

    1.
      Pledge.
      In
      consideration of the sum of $1,000,000.00 loaned to Pledgor by Pledgee, receipt
      of which is acknowledged, Pledgor hereby grants a security interest to Pledgee
      in instruments of the following description: 562,063 shares of AMERICAN SAVINGS,
      FSB stock.  The
      stock
      certificate for said shares and the stock power, as provided for in the
      Tri-Party Escrow Agreement, shall be held in safekeeping under a Tri-Party
      Escrow Agreement with an escrow agent (Escrow Depository) executed of even
      date
      herewith. 

     

    2.
      Transfer.
      During
      the time that the Escrowed Documents (as defined in the Tri-Party Escrow
      Agreement) remain in escrow, the Corporation, the Lender/Pledgee, and the Escrow
      Depository shall agree that no sale or transfer or other disposition of the
      escrowed Shares or any interest in the escrowed Shares shall be consummated,
      nor
      shall any consideration be received for the escrowed Shares.

      

    3.
      Duration.
      The
      Escrow Depository shall be authorized and instructed to hold the certificates
      representing the Escrowed Documents described in Paragraph 1. in escrow until
      the Escrow Depository has been furnished written notices from Lender/Pledgee
      indicating that Corporation has fully paid the Term Note secured by the pledge
      of said Shares as collateral, at which time said Shares shall be immediately
      released and returned to Corporation/Pledgor, or until the Escrow Depository
      has
      been furnished written notices from Lender/Pledgee indicating that an Event
      of
      Default has occurred, at which time the Escrowed Documents shall be immediately
      released and tendered to the Lender/Pledgee.

    

    4.
      Voting
      rights.
      During
      the term of this pledge, and so long as Pledgor is not in default in the
      performance of any term of this agreement or in the payment of the principal
      or
      interest of the Term Note according to its terms, Pledgor may vote the pledged
      shares on all corporate questions, and Pledgee shall, if necessary, execute
      due
      and timely proxies in favor of Pledgor to this end. As long as Pledgor shall
      not
      be in default on the payment of principal and interest on the Term Note, neither
      Pledgee nor Custodian shall be entitled to exercise any control over American
      Savings, FSB by reason of the subject loan, pledge and related matters. If
      the
      Pledgor defaults on a Term Note, the Pledgee/Lender shall be entitled to vote
      the pledged shares on all corporate questions so long as Company shall remain
      in
      default, but only to the extent permitted by applicable law and regulations,
      including Part 574 of the OTS Regulations, with Pledgor retaining the remaining
      voting rights.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.
      Representations.
      Pledgor
      warrants and represents that, except as required by applicable law or
      regulations including Part 574 of the OTS Regulations, there are no restrictions
      upon the transfer of any pledged shares, other than may appear on the face
      of
      the certificate, and that Pledgor is the sole shareholder of American Savings,
      FSB and has the right to transfer such shares free of any
      encumbrances.

    

    6.
      Adjustments.
      If,
      during the term of this pledge, any share dividend, reclassification,
      readjustment, or other change is declared or made in the capital structure
      of
      the company not incident to American Savings, FSB’s normal operations as a
      depository institution, all new, substituted, and additional shares, or other
      securities, issued by reason of any such change shall be held by Escrow
      Depository under the terms of this agreement in the same manner as the shares
      originally pledged hereunder. Notwithstanding any other statement herein to
      the
      contrary, as long as Pledgor is not in default of the Term Note, (i) American
      Savings, FSB shall be entitled to declare and pay such cash dividends, if and
      only if said dividends are consistent with past practices, (ii) Pledgor shall
      be
      entitled to receive such cash dividends immediately on payments, and (iii)
      Pledgee and Escrow Depository shall have no rights with respect to such
      dividends. 

     

    7.
      Warrants
      and Rights. If,
      during the term of this pledge, subscription warrants or any other rights or
      options are issued in connection with the pledged shares, Pledgee shall
      immediately assign the pledged warrants, rights, or options to Pledgor. If
      exercised by Pledgor, all new shares or other securities so acquired by Pledgor
      shall be immediately pledged as additional collateral to Pledgee and delivered
      to Escrow Depository to be held under the terms of this agreement in the same
      manner as the shares originally pledged hereunder.

     

    8.
      Payment
      of loans. Upon
      full
      payment of the principal and interest of a Term Note secured by the collateral
      held in escrow pursuant hereto, the respective Lender/Pledgee whose loan has
      been fully repaid shall immediately (within two (2) business days) provide
      written notice to Escrow Depository that said respective Term Note has been
      fully repaid, and shall authorize and direct the Escrow Depository to transfer
      and return to Pledgor all the pledged shares and all rights received by Pledgee,
      if any, as a result of the original collateral pledge.

     

    9.
      Default.
      If
      Pledgor defaults in the performance of any terms of this agreement, the payment
      of interest under the Term Note or in the payment at maturity of the principal
      and all outstanding interest of the Term Note, said events shall constitute
      an
“Event of Default” hereunder

    

        Remedies
      upon
      Default.
      Upon
      the occurrence of an Event of Default:

     

    a.  Lender/Pledgee
      may declare the entire indebtedness evidenced by the Term Note immediately
      due
      and payable, without notice or demand of any kind.

    

    b.  Lender/Pledgee
      shall have and may exercise the rights and remedies provided in the Uniform
      Commercial Code in force in the State of Indiana at the date of this Agreement,
      subject to Federal banking laws and regulations as applicable. In addition
      to
      and in conjunction with such rights and remedies, Pledgee may, by giving five
      days' notice to Pledgor by registered mail, and without liability for any
      diminution in price that may have occurred, sell the pledged shares in any
      commercially reasonable manner as defined under the Indiana Uniform Commercial
      Code, subject to Federal banking laws and regulations as applicable. At any
      bona
      fide public sale Pledgee may purchase all or any part of the pledged shares.
      Pledgee may retain out of the proceeds of any sale an amount equal to the
      principal and interest then due on the loan, plus the expenses of the sale,
      and
      shall pay any balance of the proceeds to Pledgor. If the sale proceeds are
      insufficient to cover the principal and interest of the loan and the sale
      expenses, Pledgor shall remain liable to Pledgee for the
      deficiency.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10.
      Public
      Disclosure.
      The
      parties hereto agree, subject to applicable law, to make no public disclosure
      regarding the loan, pledge and related matters, without the other parties’
consent, which consent shall not be unreasonably withheld.

    

    11.
      Transferability.
      This
      Collateral Pledge Agreement and the rights hereunder are not assignable to
      a
      third party.

     

     

    In
      witness whereof the parties have executed this agreement.

    

    AMB
      Financial Corporation  (Corporation/Pledgor)

    

     By
      _____________________________[signature]     Date:_____________

     Printed
      Name:____________________

     Title:___________________________

      

    

    First
      Regional Bank, custodian FBO Clement B. Knapp, Jr. IRA
      (Lender/Pledgee)

    

          
      _____________________________[signature]     Date:_____________

     Address:
      P.O. Box 85410, San Diego, CA 92186-5410

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