Document:

exv10w56

Exhibit-10.56

	 	 	 
	 

	 	M&I Marshall & Ilsley Bank
	 

	 	770 North Water Street
	 

	 	Milwaukee, Wl 53202-3509
	 

	 	414 765-7700 
mibank.com
	 
	 

	 	March 31, 2008

Ms. JoAnn S. Lilek

Executive Vice President & CFO

Midwest Banc Holdings, Inc.

501 West North Avenue

Melrose Park, IL 60160

Dear Ms. Lilek:

This letter agreement (the “Agreement”) is made and entered into as of this 31st
 day of March, 2008,
by and between Midwest Banc Holdings, Inc. (the “Borrower”) and M&I Marshall & Ilsley Bank (the
“Lender”). This Agreement replaces a letter agreement dated September 28, 2007

The terms of this Agreement will apply (except as otherwise provided herein) so long as any
obligation is owed to Lender or Lender has any outstanding commitment to lend to Borrower, under
the terms and conditions of any promissory note or other agreement between Borrower and Lender.
Currently, those agreements include, without limitation: (a) a revolving credit promissory note
(or “Revolving Loan”) in the maximum principal amount of $25,000,000.00; (b) a term note in the
original principal amount of $75,000,000.00, which is being amended to be in the principal
amount of $55,000,000.00; and (c) a “Subordinated Term Note” in the principal amount of
$15,000,000.00.

	 	1.	 	While any amount is owed by Borrower to Lender or Lender has any commitment to
advance any credit to Borrower, Lender shall have received the following “Loan
Documents,” in form and substance satisfactory to Lender:

	 	(i)	 	a promissory note as to each loan;
	 
	 	(ii)	 	a pledge or security agreement granting to Lender a first
priority security interest in 100% of the capital stock of Midwest Bank and
Trust Company (“Midwest Bank); and
	 
	 	(iii)	 	physical possession of each stock certificate representing
such stock a blank, signed irrevocable stock power for each stock
certificate, and such other documents as may be necessary to take, maintain
and perfect a first priority security interest in all capital stock of
Midwest Bank.

	 	 	 	(Subsections (ii) and (iii) above shall not apply to the Subordinated Term Note.)
	 
	 	2.	 	Borrower shall furnish to Lender, as soon as available, such financial
information respecting Borrower or Midwest Bank as Lender from time to time requests,
and without request furnish to Lender:

 

 

(i) Within 120 days after the end of each fiscal year of Borrower, a balance sheet of
Borrower as of the close of such fiscal year and related statements of income and retained
earnings and cash flow for such year all in reasonable detail and satisfactory in scope to
Lender, prepared in accordance with generally accepted accounting principles applied on a
consistent basis, audited by an independent certified public accountant, selected by
Borrower and acceptable to Lender.

(ii) Within 45 days after the end of each fiscal quarter, a balance sheet of Borrower as
of the end of such quarter and related statements of income and retained earnings and cash
flow for the period from the beginning of the fiscal year to the end of such quarter,
prepared in accordance with generally accepted accounting principles applied on a
consistent basis, subject to normal year-end adjustments, certified by a financial
representative of Borrower.

(iii) Copies of all quarterly Federal Financial Institution Examination Council Form 031
(“Call Reports”) required of Midwest Bank no later than the due date by which those Call
Reports are required by the regulating agencies to be filed, prepared in accordance with
agency requirements, certified by chief financial representative of Bank.

(iv) Within 45 days after the end of each fiscal quarter, grid price monitoring will be
required.

	 	3.	 	Borrower shall timely perform and observe the following financial covenant(s), all calculated
in accordance with generally accepted accounting principles applied on a consistent basis.

(i) Midwest Bank shall maintain at all times a ratio of non-performing loans to Total
Loans of not greater than 3.00%, tested quarterly at the end of each calendar quarter.
“Non-performing Loans” means loans outstanding which are not accruing interest, have been
classified as renegotiated pursuant to guidelines established by the Federal Financial
Institutions Examination council or are 90 days or more past due in the payment of any
principal or interest. “Total Loans” means the sum of loans and direct lease financings,
net of unearned income by Midwest Bank.

(ii) Midwest Bank must report a positive net profit, tested quarterly, at each calendar
quarter end, but excluding charges related to acquisitions.

(iii) Midwest Bank must remain “well capitalized” within the meaning of the Federal
Deposit Insurance Act at 12 USC 1831o and the regulations thereunder applicable to Midwest
Bank.

	 	4.	 	Neither Borrower nor Midwest Bank shall merge into or consolidate with any other business
enterprise and no other business enterprise shall merge into or with the Borrower or Midwest
Bank, without prior written consent of Lender. (But this provision shall not apply to the
Subordinated Term Note.)

 

 

	 	5.	 	Neither Borrower nor Midwest Bank shall become subject to any adverse regulatory
action (including, without limitation, any written agreement for corrective action,
a memorandum of understanding which limits in any way the ability of Midwest Bank to
pay dividends to Borrower or a cease and desist order).
	 
	 	6.	 	The Revolving Loan is intended for use as working capital. Such Loan shall not
be used for the purpose of acquiring another financial institution or enterprise unless
approved by Lender (the request for approval may be made following the announcement of
a definitive agreement).
	 
	 	7.	 	All outstanding debt is immediately due on the sale of the stock of Midwest
Bank or Borrower, or of substantially all of the assets of either.
	 
	 	8.	 	In the event of a known or intended change in or departure of any executive
management of Borrower, Borrower shall promptly notify Lender of the same and provide
Lender with a reasonably acceptable succession plan within 90 days thereafter.
	 
	 	9.	 	Borrower debt other than that owed to Lender shall never be greater than
$2,000,000 (principal) without prior written approval of Lender (excluding trust
preferred indebtedness or other indebtedness that is subordinate (in accordance with SR
92-37 issued by the FRB on October 15, 1992) to the claims of creditors of Borrower
with respect to the following: (a) borrowed and purchased money; (b) similar
obligations arising from off-balance-sheet guaranties and direct-credit substitutes;
and (c) obligations associated with derivative products such as interest-rate and
foreign exchange-rate contracts, commodity contracts, and similar arrangements), which
approval will not be unreasonably withheld (but this provision shall not affect the
Subordinated Term Note).

A breach or failure of performance in any term or condition in this Agreement shall constitute an
additional event of default under each of the Loan Documents (subject however to a 10 day cure
period for payment defaults and a 30 day cure period for non-payment defaults), and Lender may
then, at its option (except, as to the Subordinated Term Note which has its own acceleration
provisions), declare the notes due and payable, and may pursue all remedies available to it under
the Loan Documents or otherwise.

The undersigned shall pay and reimburse Lender for all expenses incurred by it in protecting or
enforcing its rights under the Loan Documents or this Agreement, including without limitation,
costs of administration and costs of collection before and after judgment, including reasonable
attorney’s fees and legal expenses.

In the case of any ambiguity or conflict between this Agreement and any Loan Document, this
Agreement will govern (except, however as to the Subordinated Term Note, as to which, in the event
of any inconsistency, that Note shall control).

 

 

Please confirm your acknowledgment and acceptance of the terms and conditions of this Agreement by
signing and dating below.

	 	 	 	 	 	 	 	 	 	 	 
	Very truly yours,	 	 	 	Accepted and Agreed: March 31, 2008	 	 
	M&I Marshall & Ilsley Bank	 	 	 	Midwest Banc Holdings, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ John J. Kadlac
 

	 	 
	 	By:
	 	/s/ JoAnn S. Lilek
 

	 	 
	John J. Kadlac, VP/Senior RM	 	 	 	Title:	 	 JoAnn S. Lilek, EVP/CFO	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By: 

Title:

	 	/s/ Allen J. Wolf
 

Sr. VP
	 	 	 	 	 	 	 	 

 

 

FIRST AMENDMENT TO NOTE

(M&I/Midwest Banc Holdings $75,000,000.00 Note)

(M&I Loan No. 37956985-10001)

     M&I Marshall & Ilsley Bank (“Lender”) and Midwest Banc Holdings, Inc. (“Borrower”) are
parties to a September 28, 2007 Promissory Note in the face amount of $75,000,000.00 (copy
attached) (the “Note”). The parties wish to amend that Note according to this First Amendment.
Therefore, the parties agree as follows:

	 	1.	 	Upon signing hereof, Borrower shall pay down the Note (including with the
proceeds of a separate $15,000,000.00 loan being made by Lender to Borrower
simultaneously herewith) so that the total principal outstanding on the Note shall then
be $55,000,000.00. Upon that pay down, wherever in the Note reference is made to
$75,000,000.00 (in numbers or words) the Note shall be considered to be amended to read
“$55,000,000.00.”
	 
	 	2.	 	The exhibit to the Note (titled “Applicable Margin”) is replaced in its
entirety by the “Applicable Margin” exhibit attached to this First Amendment.
	 
	 	3.	 	The section labeled “Prepayment” in the Note (paragraph 4 on page 1) is
replaced by the following:
	 
	 	 	 	Prepayments. The Borrower may at its option, at any time, prepay this Note, in part;
provided, however, that the Borrower may not prepay this Note in its entirety, so
long as any portion of that certain Subordinated Term Note dated as of March 31,
2008 by the Borrower in favor of the Lender in the initial principal amount of
$15,000,000.00 (U.S. Dollars) (as amended from time to time, the “Subordinated Term
Note”) remains outstanding, unless this Note has been accelerated by the Bank.
	 
	 	4.	 	As amended hereby, the Note is ratified.

Dated: March 31, 2008

	 	 	 	 	 	 	 	 	 	 	 
	MIDWEST BANC HOLDINGS, INC.	 	 	 	M&I MARSHALL & ILSLEY BANK	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ JoAnn S. Lilek
 

JoAnn S. Lilek,
	 	 
	 	By:

	 	/s/ John J. Kadlac
 

Title: John J. Kadlac, VP/ Senior RM
	 	 
	 

	 	Executive Vice President	 	 	 	 	 	 	 	 
	 

	 	Chief Financial Officer
	 	 	 	By:

	 	/s/ Allen J. Wolf
 

Title: Sr. VP
	 	 

 

 

     As provided in the “Variable Interest Rate” paragraph in the Note, interest on this Note, will
vary based on changes in the One-Month LIBOR Rate (the “Index”). The interest rate will also vary
based upon the Borrower’s “Return on Assets” (as defined below) and the following “Applicable
Margin” (which shall be added to the Index to determine the interest rate under this Note):

	 	 	 	 	 
	If Borrowers Return On Assets Is:	 	The Applicable Margin Is:
	(a) Not greater than .5% for two consecutive calendar
quarters

	 	 	1.55	%
	 
	(b) Greater than .5% but less than or equal to 1.04% for
two consecutive calendar quarters

	 	 	1.40	%
	 
	(c) Greater than 1.04% for two consecutive calendar quarters

	 	 	1.25	%

Dated: March 31, 2008

	 	 	 	 	 
	 	MIDWEST BANC HOLDINGS, INC.

 	 
	 	By:  	/s/ JoAnn S. Lilek
 	 
	 	 	JoAnn S. Lilek, 	 
	 	 	Executive Vice President

Chief Financial Officer 	 
	 

M&I/Midwest Banc Holdings

Exhibit to First Amendment to Note

For Loan No. 37956985-10001

 

 

SUBORDINATED TERM NOTE

 

THIS SUBORDINATED TERM NOTE IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY FEDERAL AGENCY.
 

			
	 	 	 
	$15,000,000.00
	 	Chicago, Illinois
	 
	 	March 31, 2008

     FOR VALUE RECEIVED, the undersigned MIDWEST BANC HOLDINGS, INC. (the “Borrower”), promises to
pay to the order of M&I MARSHALL & ILSLEY BANK (the “Bank”), at its office in Milwaukee, WI, the
principal sum of Fifteen Million and 00/100 Dollars ($15,000,000.00) plus interest, all as
provided below.

     1. Interest. The unpaid principal balance outstanding from time-to-time shall bear interest
before maturity (whether by acceleration or lapse of time) at a variable rate equal to the
One-Month LIBOR rate (as defined below) plus 350 basis points, which rate will change as of the
first day of each month if the One-Month LIBOR Rate changes.

     (a) “One-Month LIBOR Rate” means the annual rate equal to the rate at which U.S. dollar
deposits are offered on the first day of each calendar month on or about 9 a.m. Milwaukee,
Wisconsin time (rounded upwards, if necessary, to the nearest 1/16 of 1%) as determined by
the British Bankers Association and reported by a major news service selected by Lender
(such as Reuters, Bloomberg or Moneyline Telerate).

     (b) If the One-Month LIBOR Rate is not provided or reported on the first day of a month
because, for example, it is a weekend or holiday or for another reason, the One- Month LIBOR
Rate for that month shall be established as of the next preceding day on which the One-Month
LIBOR Rate is provided and reported by the selected news service.

     (c) Interest will be computed for the actual number of days principal is unpaid, based
on a year of 360 days.

     2. Payment Schedule. Borrower shall make monthly payments of interest only on the
30th day of each consecutive calendar month, beginning on April 30, 2008, plus a
final

 

 

payment of all remaining unpaid principal and any unpaid interest on March  
    , 2018 or earlier if
accelerated pursuant to section 8 below.

     3. Late Payment Fee. If any payment is not made on or before its due date, the Bank may
collect a delinquency charge of 5% of the unpaid amount. Collection of the late payment fee shall
not be deemed to be a waiver of the Bank’s right to declare a default hereunder or accelerate this
Note.

     4. Default Interest Rate. Principal amounts remaining unpaid after the maturity thereof,
whether at fixed maturity or by reason of default and acceleration of maturity, shall bear interest
from and after maturity until paid at a rate of 3% per annum plus the rate of interest otherwise
payable hereunder.

     5. Maximum Rate. In no event will the interest rate hereunder exceed that permitted by
applicable law. If any interest or other charge is finally determined by a court of competent
jurisdiction to exceed the maximum amount permitted by law, the interest or charge shall be reduced
to the maximum permitted by law, and the Bank may credit any excess amount collected against the
balance due or refund the amount to the Borrowers.

     6. Prepayment. This Note may be prepaid in full or in part at any time without premium.
Prepayments of less than all the outstanding amount of this Note shall be applied to principal.

     7. Application of Payments. Payments due under this Note shall be made in lawful money of the
United States, and the Bank is authorized to apply payments received from Borrower to any
obligation owed Bank by Borrower unless Borrower specifies in writing the obligation to which a
payment should be applied. However payments applied to this Note shall be applied by the Bank first
to interest, then to other costs, fees and charges due hereunder and last to principal. Bank is
authorized to deduct and withdraw payments due under this Note from any account of Borrower at
Bank.

     8. Default Acceleration. The following are “Events of Default” hereunder: (a) Borrower fails
to pay any amount when due under this Note; (b) any default or failure of performance occurs under
a letter loan agreement dated contemporaneously herewith as it may be amended, modified or restated
(the “Letter Agreement”); (c) any default or failure of performance occurs under any other note or
agreement between Borrower and Bank; and (d) Borrower becomes the subject of any bankruptcy, or
receivership proceedings (voluntary or involuntary). Upon the occurrence of the Event of Default
specified in (d) above, and only

2

 

upon that occurrence, this Note and indebtedness evidenced hereby may, at Lender’s option, be
accelerated, and the entire amount owed is then due. Bank’s receipt of any payment on this Note
after the occurrence of an event of default shall not constitute a waiver of the default or of
Bank’s rights and remedies upon such default.

     9. Security. This Note is not secured.

     10. Rights of Bank. Without affecting the liability of Borrower, any indorser, or any surety,
Bank may, without notice, accept partial payments or agree not to sue any party or guarantor liable
on it. Without affecting the liability of any indorser or surety, Bank may from time to time,
without notice, renew or extend the time for any payment.

     11. Costs and Fees; Indemnity. Borrower agrees to pay all costs of collection before and
after judgment, including reasonable attorneys’ fees (including those incurred in successful
defense or settlement of any counterclaim brought by Borrower or incident to any action or
proceeding involving Borrower brought pursuant to the United States Bankruptcy Code or other
insolvency proceedings) and waive presentment, protest, demand and notice of dishonor. Borrower
agrees to indemnify and hold harmless Bank, its directors, officers, employees and agents, from and
against any and all claims, damages, judgments, penalties, and expenses, including reasonable
attorneys’ fees, arising directly or indirectly from credit extended under this Note or the
activities of Borrower. This indemnity shall survive payment of this Note. Borrower acknowledge
that Bank has not made any representations or warranties with respect to, and that Bank does not
assume any responsibility to Borrower for, the collectability or enforceability of this Note or the
financial condition of Borrower.

     12. Interpretation. This Note and the credit advanced hereunder are for business purposes.
This Note is intended by Borrower and Bank as a final expression of this Note and as a complete and
exclusive statement of its terms, there being no conditions to the enforceability of this Note.
This Note may not be supplemented or modified except (a) by a Letter Agreement between the parties
dated contemporaneously herewith, as it may be amended or (b) by another writing signed by both
Borrower and Bank. This Note benefits Bank, its successors and assigns, and binds Borrower and
Borrower’s successors and assigns. The validity, construction and enforcement of this Note are
governed by the internal laws of Wisconsin. Invalidity or unenforceability of any provision of this
Note shall not affect the validity or enforceability of any other provisions of this Note.

     13. Venue; Jurisdiction. Borrower consents that venue for any legal proceeding

3

 

relating to collection of this Note shall be, at Bank’s option, the Milwaukee County, Wisconsin
Circuit Court, or the Federal District Court for the Eastern District of Wisconsin. Borrower
agrees and consents to the personal jurisdiction of any such Courts and agrees that venue in such
Courts is not inconvenient for Borrower.

     14. Waiver of Jury Trial. BORROWER AND BANK HEREBY BOTH WAIVE ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION OR PROCEEDING RELATING TO THIS NOTE, THE CREDIT AGREEMENT, OR ANY RELATED LOAN
DOCUMENTS, THE OBLIGATIONS THEREUNDER, OR ANY TRANSACTION ARISING THEREFROM OR CONNECTED
THERETO. BORROWER AND BANK EACH REPRESENT TO THE OTHER THAT THIS WAIVER IS KNOWINGLY,
WILLINGLY AND VOLUNTARILY GIVEN.

     15. Subordination. The rights of Bank to the principal sum hereunder or any part hereof and
to any accrued interest thereon shall remain subject and subordinate (in accordance with SR 92-37
issued by the FRB on October 15, 1992) to the claims of creditors of Borrower with respect to the
following (“Senior Indebtedness”): (a) borrowed and purchased money; (b) similar obligations
arising from off-balance-sheet guaranties and direct-credit substitutes; and (c) obligations
associated with derivative products such as interest-rate and foreign exchange-rate contracts,
commodity contracts, and similar arrangements (clauses (a), (b) and (c) expressly exclude trade
accounts payable and accrued liabilities under Trust Preferred Indebtedness of Borrower, as defined
below, with respect to which the rights of Bank are not subordinate). Upon dissolution or
liquidation of Borrower, no payment of principal, interest or premium (including post-default
interest) shall be due and payable under the terms of this Note until all Senior Indebtedness
(which expressly exclude trade accounts payable and accrued liabilities of Borrower) shall have
been paid in full.

     As used herein, “Trust Preferred Indebtedness” means indebtedness incurred in connection
with, or relating to, any trust preferred securities caused to be issued by, or reflected in the
consolidated financial statements of Borrower, including the subordinated indebtedness evidenced
by any junior subordinated debentures relative thereto.

     16. Defect in Terms. It is the intent of Borrower and Bank that this Note be treated as Tier 2
Capital of Borrower in accordance with the rules and regulations of the Federal Reserve Board
(“FRB”) in effect on the date hereof. In the event the FRB notifies Borrower that this Note does
not constitute Tier 2 Capital of Borrower due to a defect in the terms of this Note, the parties
shall negotiate in good faith to cure such defect by amending this Note.

4

 

     17. Captions. All descriptive headings are for convenience only and shall not control or
affect the meaning or construction of any provision of this Note.

	 	 	 	 	 
	MIDWEST BANC HOLDINGS, INC.

 	 	 
	By:  	/s/ JoAnn S. Lilek
 	 	 
	 	JoAnn S. Lilek 	 	 
	 	Executive Vice President and

Chief Financial Officer 	 	 
	 

5exv10w57

Exhibit-10.57

*00037956985-10000-095504042008*

PROMISSORY NOTE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Principal

$25,000,000.00
	 	Loan Date

04-04-2008
	 	Maturity

04-03-2009
	 	Loan No

37956985-10000-
	 	Call/Coll

X165/P0
	 	Account

00005106953
	 	Officer

06564
	 	Initials

References in the boxes above are for Lender’s use only and do not limit the

applicability of this document to any particular loan or item.

Any item above containing “***” has been omitted due to text length limitations.

	 	 	 	 	 	 	 	 	 
	Borrower:

	 	Midwest Banc Holdings, Inc.
	 	 	 	Lender:
	 	M&I Marshall & Ilsley Bank
	 

	 	501 W North Ave
	 	 	 	 	 	Correspondent Banking
	 

	 	Melrose Park, IL 60160-1603
	 	 	 	 	 	770 N. Water Street
	 

	 	 	 	 	 	 	 	Milwaukee, Wl 53202

			
	 	 	 
	Principal Amount: $25,000,000.00
	 	Date of Note: April 4, 2008

PROMISE TO PAY. Midwest Banc Holdings, Inc. (“Borrower”) promises to pay to M&l Marshall & llsley
Bank (“Lender”), or order, in lawful money of the United States of America, the principal amount
of Twenty-five Million & 00/100 Dollars ($25,000,000.00) or so much as may be outstanding,
together with interest on the unpaid outstanding principal balance of each advance. Interest shall
be calculated from the date of each advance until repayment of each advance.

PAYMENT. Borrower will pay this loan in one payment of all outstanding principal plus all accrued
unpaid interest on April 3, 2009. In addition, Borrower will pay regular monthly payments of all
accrued unpaid interest due as of each payment date, beginning May 3, 2008, with all subsequent
interest payments to be due on the same day of each month after that. Unless otherwise agreed or
required by applicable law, payments will be applied to Accrued Interest, Principal, Late
Charges, and Escrow. The annual interest rate for this Note is computed on a 365/360 basis; that
is, by applying the ratio of the annual interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number of days the principal balance is
outstanding. Borrower will pay Lender at Lender’s address shown above or at such other place as
Lender may designate in writing.

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from time to time
based on changes in an independent index which is the British Bankers Association (BBA) LIBOR and
reported by a major news service selected by Lender (such as Reuters, Bloomberg or Moneyline
Telerate). If BBA LIBOR for the one month period is not provided or reported on the first day of
a month because, for example, it is a weekend or holiday or for another reason, the One Month
LIBOR Rate shall be established as of the preceding day on which a BBA LIBOR rate is provided for
the one month period and reported by the selected news service (the “Index”). The Index is not
necessarily the lowest rate charged by Lender on its loans. If the Index becomes unavailable
during the term of this loan, Lender may designate a substitute index after notifying Borrower.
Lender will tell Borrower the current Index rate upon Borrower’s request. The interest rate
change will not occur more often than each first day of each calendar month and will become
effective without notice to the Borrower. Borrower understands that Lender may make loans based
on other rates as well. The interest rate to be applied to the unpaid principal balance during
this Note will be at a rate equal to the Index plus the Applicable Margin. NOTICE: Under no
circumstances will the interest rate on this Note be more than the maximum rate allowed by
applicable law.

PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges are earned fully
as of the date of the loan and will not be subject to refund upon early payment (whether
voluntary or as a result of default), except as otherwise required by law. Except for the
foregoing, Borrower may pay without penalty all or a portion of the amount owed earlier than it
is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of
Borrower’s obligation to continue to make payments of accrued unpaid interest. Rather, early
payments will reduce the principal balance due. Borrower agrees not to send Lender payments
marked “paid in full”, “without recourse”, or similar language. If Borrower sends such a payment,
Lender may accept it without losing any of Lender’s rights under this Note, and Borrower will
remain obligated to pay any further amount owed to Lender. All written communications concerning
disputed amounts, including any check or other payment instrument that indicates that the payment
constitutes “payment in full” of the amount owed or that is tendered with other conditions or
limitations or as full satisfaction of a disputed amount must be
mailed or delivered to: M&I
Marshall & Ilsley Bank, P.O. 3114 Milwaukee, WI 53201-3114.

LATE CHARGE. If a payment is not made on or before the 10th day after its due date, Borrower will
be charged 5.000% of the unpaid portion of the regularly scheduled payment.

INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest
rate on this Note shall be increased by adding a 3.000 percentage point margin (“Default Rate
Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change that
would have applied had there been no default. However, in no event will the interest rate exceed
the maximum interest rate limitations under applicable law.

DEFAULT. Each of the following shall constitute an event of default
(“Event of Default”) under this Note:

Payment Default. Borrower fails to make any payment when due under this Note.

Other Defaults. Borrower fails to comply with or to perform any other term, obligation,
covenant or condition contained in this Note or in any of the related documents or to comply
with or to perform any term, obligation, covenant or condition contained in any other
agreement between Lender and Borrower.

Default in Favor of Third Parties. Borrower or any Grantor defaults under any loan, extension
of credit, security agreement, purchase or sales agreement, or any other agreement, in favor
of any other creditor or person that may materially affect any of Borrower’s property or
Borrower’s ability to repay this Note or perform Borrower’s obligations under this Note or any
of the related documents.

False Statements. Any warranty, representation or statement made or furnished to Lender by
Borrower or on Borrower’s behalf under this Note or the related documents is false or
misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.

 

 

Insolvency. The dissolution or termination of Borrower’s existence as a going business, the
insolvency of Borrower, the appointment of a receiver for any part of Borrower’s property, any
assignment for the benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against Borrower.

Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings,
whether by judicial proceeding, self-help, repossession or any other method, by any creditor of
Borrower or by any governmental agency against any collateral securing the loan. This includes a
garnishment of any of Borrower’s accounts, including deposit accounts, with Lender. However,
this Event of Default shall not apply if there is a good faith dispute by Borrower as to the
validity or reasonableness of the claim which is the basis of the creditor or forfeiture
proceeding and if Borrower gives Lender written notice of the creditor or forfeiture proceeding
and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in
an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for
the dispute.

Events Affecting Guarantor. Any of the preceding events occurs with respect to any guarantor,
endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser,
surety, or accommodation party dies or becomes incompetent, or revokes or disputes the validity
of, or liability under, any guaranty of the indebtedness evidenced by this Note.

Change In Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower.

Adverse Change. A material adverse change occurs in Borrower’s financial condition, or Lender
believes the prospect of payment or performance of this Note is impaired.

Insecurity. Lender in good faith believes itself insecure.

LENDER’S RIGHTS. Upon default, Lender may declare the entire unpaid principal balance under this
Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount.

ATTORNEYS’ FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note if
Borrower does not pay. Borrower will pay Lender that amount. This includes, subject to any limits
under applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether or not there
is a lawsuit, including attorneys’ fees, expenses for bankruptcy proceedings (including efforts to
modify or vacate any automatic stay or injunction), and appeals. If not prohibited by applicable
law, Borrower also will pay any court costs, in addition to all other sums provided by law.

JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action,
proceeding, or counterclaim brought by either Lender or Borrower against the other.

GOVERNING LAW. This Note will be governed by federal law applicable to Lender and, to the extent
not preempted by federal law, the laws of the State of Wisconsin without regard to its conflicts
of law provisions. This Note has been accepted by Lender in the State of Wisconsin.

CHOICE OF VENUE. If there is a lawsuit, Borrower agrees upon Lender’s request to submit to the
jurisdiction of the courts of Milwaukee County, State of Wisconsin.

DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on
Borrower’s loan and the check or preauthorized charge with which Borrower pays is later
dishonored.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in
all Borrower’s accounts with Lender (whether checking, savings, or some other account). This
includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open
in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for
which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on the indebtedness against any and all such
accounts, and, at Lender’s option, to administratively freeze all such accounts to allow Lender to
protect Lender’s charge and setoff rights provided in this paragraph.

LINE OF CREDIT. This Note evidences a revolving line of credit. Advances under this Note, as well
as directions for payment from Borrower’s accounts, may be requested orally or in writing by
Borrower or by an authorized person. Lender may, but need not, require that all oral requests be
confirmed in writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance
with the instructions of an authorized person or (B) credited to any of Borrower’s accounts with
Lender. The unpaid principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender’s internal records, including daily computer print-outs.
Lender will have no obligation to advance funds under this Note if: (A) Borrower or any guarantor
is in default under the terms of this Note or any agreement that Borrower or any guarantor has
with Lender, including any agreement made in connection with the signing of this Note; (B)
Borrower or any guarantor ceases doing business or is insolvent; (C) any guarantor seeks, claims
or otherwise attempts to limit, modify or revoke such guarantor’s guarantee of this Note or any
other loan with Lender; (D) Borrower has applied funds provided pursuant to this Note for purposes
other than those authorized by Lender; or (E) Lender in good faith believes itself insecure.

HEDGING INSTRUMENTS. Obligations and Indebtedness includes, without limitation all obligations,
indebtedness and liabilities arising pursuant to or in connection with any interest rate swap
transaction, basis swap, forward rate transaction, interest rate option, price risk hedging
transaction or any similar transaction between the Borrower and Lender.

APPLICABLE MARGIN. An exhibit, titled “Applicable Margin,” is attached to this Note and by this
reference is made a part of this Note just as if all the provisions, terms and conditions of the
Exhibit had been fully set forth in this Note.

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower’s
heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender
and its successors and assigns.

GENERAL PROVISIONS. This Note benefits Lender and its successors and assigns, and binds Borrower
and Borrower’s heirs, successors, assigns, and representatives. If any part of this Note cannot be
enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any
of its rights or remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand
for payment, and notice of dishonor. Upon any change in the terms of this Note, and unless
otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such parties agree that
Lender may renew or extend (repeatedly and for any length of time) this loan or release any party
or guarantor or collateral or impair, fail to realize upon or perfect Lender’s security interest
in the collateral; and take any other action deemed necessary by Lender without the consent of or
notice to anyone. All such parties also agree that Lender may modify this loan without the consent
of or notice to anyone other than the party with whom the modification is made. The obligations
under this Note are joint and several.

 

 

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING
THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.

BORROWER:

MIDWEST BANC HOLDINGS, INC.

	 	 	 	 	 
	By:

	 	/s/ Joann S. Lilek	 	 
	 

	 	 

	 	 
	Authorized Signer for Midwest Banc Holdings, Inc.	 	 

LASER
PRO Lending, Ver. 5.39.00.008 Copr, Harland Financial Solutions, Inc.
1997, 2008. All Rights

Reserved. -WI L:LPL\CFI\LPL\D20.FC TR-130880 PR-55 (M)

 

 

DISBURSEMENT REQUEST AND AUTHORIZATION

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Principal

$25,000,000.00

	 	 	Loan Date

04-04-2008
	 	 	Maturity

04-03-2009
	 	 	Loan No

37956985-10000
	 	 	Call / Coll

X165 / P7
	 	 	Account

00005106953
	 	 	Officer

06564
	 	 	Initials	 	 	 
	 	References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.

Any item above containing “***” has been omitted due to text length limitations.	 
	 

	 	 	 	 	 	 	 
	Borrower:

	 	Midwest Banc Holdings, Inc.
	 	Lender:
	 	M&I Marshall & Ilsley Bank
	 

	 	501 W North Ave
	 	 	 	Correspondent Banking
	 

	 	Melrose Park, IL 60160-1603
	 	 	 	770 N. Water Street
	 

	 	 	 	 	 	Milwaukee, WI 53202

 

LOAN TYPE. This is a Variable Rate Nondisclosable Revolving Line of Credit Loan to a
Corporation for $25,000,000.00 due on April 3, 2009. A margin of 0.000% is added to the
index rate. Lender will tell the Borrower the current index rate upon Borrower’s request.
This is a secured renewal loan.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:

o Personal, Family or Household Purposes or Personal Investment.

o Agricultural Purposes.

þ Business Purposes.

SPECIFIC PURPOSE. The specific purpose of this loan is: Working Capital at the holding
company level and capital injections into subsidiary, Midwest Bank and Trust Company.

DISBURSEMENT INSTRUCTIONS. Borrower understands that no loan proceeds will be disbursed until
all of Lender’s conditions for making the loan have been satisfied. Please disburse the loan
proceeds of $25,000,000.00 as follows:

	 	 	 	 	 
	Undisbursed Funds:
	 	$	13,900,000.00	 
	Other Disbursements:
	 	$	11,100,000.00	 
	$11,100,000.00 Renewal of LN #37956985-10000 Principal Balance Outstanding
	 	 	 	 
	 
	 	 	 
	Note Principal:
	 	$	25,000,000.00	 

AUTOMATIC PAYMENTS. Borrower hereby authorizes Lender automatically to deduct from Borrower’s
Demand Deposit — Checking account, numbered                     , the amount of any loan payment. If the funds in
the account are insufficient to cover any payment, Lender shall not be obligated to advance
funds to cover the payment. At any time and for any reason, Borrower or Lender may voluntarily
terminate Automatic Payments.

JOINT CREDIT INTENT. If the application was for joint credit, all persons signing below confirm
that their intent at time of application was to apply for joint credit.

VOIDED CHECK. If automatic loan payment is to be made via ACH from another lending institution,
please attach a voided check to this form.

INSTRUCTIONS TO BANKER.

	 	 	 	 	 	 	 	 	 
	1)	 	Please put an “X” next to the fees listed above that RCC is to pay.	 	 
	 
	 	 	 	 	 	 	 	 
	2)	 	Please complete the following section as applicable:	 	 
	 
	 	 	 	 	 	 	 	 
	a)

	 	Bank deposited fees into account number:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	Total dollar amount deposited into this account: $	 	 	 	 
	 

	 	 	 	 	 	 

	 	 
	b)

	 	Bank deposited fees into customer related :	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	Total dollar amount deposited into this account: $	 	 	 	 
	 

	 	 	 	 	 	 

	 	 

IF BORROWER IS AN ORGANIZATION: . If Organization has used any other name, OR if Organization
was a successor by merger, consolidation, acquisition or otherwise during the past 5 years,
list name(s) below.

 

FINANCIAL CONDITION. BY SIGNING THIS AUTHORIZATION, BORROWER REPRESENTS AND WARRANTS TO
LENDER THAT THE INFORMATION PROVIDED ABOVE IS TRUE AND CORRECT AND THAT THERE HAS BEEN NO
MATERIAL ADVERSE CHANGE IN BORROWER’S FINANCIAL CONDITION AS DISCLOSED IN BORROWER’S MOST
RECENT FINANCIAL STATEMENT TO LENDER. THIS AUTHORIZATION IS DATED APRIL 4, 2008.

 

 

DISBURSEMENT REQUEST AND AUTHORIZATION

					
	Loan No: 37956985-10000-
	 	(Continued)
	 	Page 2

 

BORROWER:

	 	 	 	 	 
	MIDWEST BANC HOLDINGS, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Joann S. Lilek	 	 
	 

	 	 

Authorized Signer for Midwest Banc Holdings, Inc.
	 	 

 

LASER PRO Landing, Ver. 5.40.00.003 Copr, Herland Financial Solutions. Inc. 1997, 2008. All Rights Reserved. - WI L:\LPL\CFI\LPL\120.FC TR-130880 PR-55

 

 

APPLICABLE MARGIN

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Principal

$25,000,000.00

	 	 	Loan Date

04-04-2008
	 	 	Maturity

04-03-2009
	 	 	Loan No

37956985-10000
	 	 	Call / Coll

X165 / P7
	 	 	Account

00005106953
	 	 	Officer

06564
	 	 	Initials	 	 	 
	 	References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or item.

Any item above containing “***” has been omitted due to text length limitations.	 
	 

	 	 	 	 	 	 	 
	Borrower:

	 	Midwest Banc Holdings, Inc.
	 	Lender:
	 	M&I Marshall & Ilsley Bank
	 

	 	501 W North Ave
	 	 	 	Correspondent Banking
	 

	 	Melrose Park, IL 60160-1603
	 	 	 	770 N. Water Street 

Milwaukee, Wl 53202

 

This APPLICABLE MARGIN is attached to and by this reference is made a part of the Promissory
Note, dated April 4, 2008, and executed in connection with a loan or other financial
accommodations between M&I MARSHALL & ILSLEY BANK and Midwest Banc Holdings, Inc.

This Applicable Margin is attached to and by this reference is made a part of the Promissory
Note, dated April 4, 2008, and executed in connection with a loan or other financial
accommodations between M&I Marshall & llsley Bank and Midwest Banc Holdings, Inc.

Interest rate change will become effective without notice to the Borrower. If the Index
becomes unavailable during the term of the Note, the Lender may substitute a comparable Index.

The percentage points over the index (“Applicable Margin”) shall be adjusted as follows:

Applicable Margin is initially set at 1.55%, and will adjust quarterly corresponding to the
performance-based grid below. Performance and Return on Assets will be calculated based on the
quarterly consolidated statements (referred to in the financial statements section of the
Letter Agreement) for the fiscal quarter ending March 31, June 30, September 30 and December
31 of each year. The adjusted Applicable Margin will commence three business days after the
receipt of the applicable quarterly consolidated statements.

	 	 	 
	Company is profitable for two consecutive quarters

	 	Applicable Margin = 1 .55%
	 
	 	 
	ROA > .50% — 1.03% for two consecutive quarters

	 	Applicable Margin = 1.40%
	 
	 	 
	ROA > 1.04% for two consecutive quarters

	 	Applicable Margin = 1.25%

 

			
	*	 	ROA to exclude restructuring charges associated with merger and acquisition activity.

THIS APPLICABLE MARGIN IS EXECUTED ON APRIL 4, 2008.

BORROWER:

	 	 	 	 	 
	MIDWEST BANC HOLDINGS, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Joann S. Lilek	 	 
	 

	 	 

Authorized Signer for Midwest Banc Holdings, Inc.
	 	 

 

LASER PRO Landing, Ver. 5.40.00.003 Copr, Herland Financial Solutions. Inc. 1997, 2008. All Rights Reserved. - WI L:\LPL\CFI\LPL\020.FC TR-130880 PR-56

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