WEST BANCORPORATION INC: Entering into a Material Definitive Agreement, Creating a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant, Financial Statements and Exhibits (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement.

On December 15, 2021, West Bancorporation, Inc. (the “Company”) has entered into a credit agreement (the “Agreement”) and related promissory note (the “Promissory Note”) with National Exchange and Trust Bank (the lender”). The agreement provides that the lender will grant the company a term loan in the amount of
$40.0 million (the “Term Loan”). The term loan matures on February 5, 2027 (the due date “).

The agreement provides for a floating interest rate equal to the Wall Street Journal prime rate plus -1.000% and a floor of 2.250% per annum. The Company may prepay the Term Loan in whole or in part at any time; however, any prepayment in whole or in part under refinancing with another institution is subject to a prepayment premium as described in the Agreement.

Under the terms of the agreement, the Company is required to pay quarterly interest on the outstanding principal balance of the term loan. The Company is required to make quarterly capital repayments commencing on May 5, 2023. All outstanding principal and accrued interest on the term loan are due and payable on the due date.

The Company’s obligations under the Agreement are secured by a first ranking lien on the entire share capital of the Company’s banking subsidiary, west bank (the “Bank”), pursuant to a commercial pledge agreement, dated December 15, 2021between the Company and the Lender (the “Pledge Agreement”).

The agreement, promissory note and pledge agreement contain the customary representations, warranties and covenants for a term loan, including certain financial covenants and capital ratio requirements. The financial covenants of the agreement include, among others, covenants requiring that (a) the Bank maintain a minimum Common Equity Tier 1 capital of at least $250,000,000(b) the company’s total risk-based capital ratio must be at least equal to the percentage that the applicable regulator may establish for a “well capitalized” institution, (c) the Tier 1 leverage ratio of the Bank, the Tier 1 risk-based capital ratio and the Bank’s total risk-based capital ratio must be at least equal to the percentage that the applicable regulator may establish for a “well capitalized” institution and (d) the Bank must maintain a minimum return of 1.00% on assets, on a twelve month basis.

The Agreement, Promissory Note and Pledge Agreement also provide for certain events of default, including, but not limited to, default in payment, breach of representations and warranties and bankruptcy or insolvency proceedings, the occurrence, after any applicable relief period, would allow the Lender, among other things, to expedite payment of all amounts unpaid under the Agreement and the Promissory Note, as the case may be, and to exercise its remedies at the in respect of shares in the capital stock of the Bank subject to the pledge agreement.

The foregoing descriptions of the Agreement, Promissory Note and Pledge Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Agreement, Promissory Note and Pledge Agreement. pledge, which are filed as Exhibits 10.1, 10.2 and 10.3, respectively, to this current report on Form 8-K and incorporated herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.

The information set out in Section 1.01 is incorporated by reference into this Section 2.03 in its entirety.

Item 9.01 Financial statements and supporting documents.




(d)    Exhibits



  10.1     Credit Agreement, dated as of December 15, 2021, by and between West
         Bancorporation, Inc. and National Exchange Bank & Trust

  10.2     Promissory Note, dated as of December 15, 2021, made by West
         Bancorporation, Inc., to and in favor of National Exchange Bank & Trust


  10.3     Commercial Pledge Agreement, dated as of December 15, 2021, by and
         between West Bancorporation, Inc. and National Exchange Bank & Trust

104      Cover Page Interactive Data File (embedded within the inline XBRL
         document)

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