SOUTH STATE Corp (Form: 8-K, Received: 11/17/2016 10:26:05)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): November 17, 2016 (November 15, 2016)

C:/USERS/ELIZWRIG/APPDATA/LOCAL/MICROSOFT/WINDOWS/TEMPORARY INTERNET FILES/CONTENT.OUTLOOK/2TX6XZIZ/SOUTH STATE CORP - STACKED 2.JPG

SOUTH STATE CORPORATION

(Exact name of registrant as specified in its charter)

South Carolina

(State or other jurisdiction of

incorporation)

001-12669

(Commission File Number)

57-0799315

(IRS Employer

Identification No.)

South Carolina

520 Gervais Street

Columbia, South Carolina

(Address of principal executive offices)

29201

(Zip Code)

(800) 277-2175

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

On November 15, 2016, South State Corporation (the “Company”) entered into a fourth amendment to the Credit Agreement (the “Agreement”) with U.S. Bank National Association (the “Lender”) dated October 28, 2013. The Agreement provides for a $10 million unsecured line of credit by the Lender to the Company. The maturity date of the Agreement is November 15, 2017, provided that the Agreement may be extended subject to the approval of the Lender.

Borrowings by the Company under the Agreement will bear interest at a rate per annum equal to 1.75% plus the one-month LIBOR rate quoted by the Lender from Reuters Screen LIBOR01 Page or any successor thereto, as described in further detail in the Agreement. For a period of not less than 30 consecutive days during each 12-month period of the Agreement, the Company must be prepay so much of the aggregate outstanding principal amount of loans as is necessary to reduce the aggregate outstanding amount of loans to an amount equal to $0 at all times during such 30-day period. The Company currently has no outstanding loans under the Agreement.

Under the terms of the Agreement, each quarter the Company is required pay an unused commitment fee based upon the average principal balance outstanding during any calendar quarter. As the average balance outstanding increases, the unused commitment fee decreases. Assuming the entire line of credit remains unused for the period of this agreement (365 days), the Company would pay the Lender $27,500 in an unused fee. This would be the maximum paid annually.

The Agreement contains customary representations, warranties, covenants and events of default, including, without limitation, financial covenants requiring that the Company maintain (i) a total risk-based capital ratio not less than 11.5% as of the last day of any fiscal quarter, (ii) a “well-capitalized” status at all times, (iii) a non-performing assets to tangible capital ratio equal to or less than 18%, and (iv) net income, excluding gains or losses resulting from the sale of investments or other capital assets (other than transactions in the ordinary course of business) and excluding gains or expenses on acquisitions arising from the acquisition method of accounting for business combinations, of at least $10.0 million for each fiscal quarter thereafter.

The foregoing summary of the amendment does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Agreement filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.

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

The relevant disclosure set forth in Item 1.01 above is incorporated herein by reference in response to this Item 2.03.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.


Exhibit No.		Description

10.1		Credit Agreement, dated as of October 28, 2013, by and between First Financial Holdings, Inc., as borrower, and U.S. Bank National Association, as lender (filed as Exhibit 10.1 of First Financial Holdings, Inc.’s Current Report on Form 8-K, filed on October 29, 2013, and incorporated herein by reference)

10.2		Amendment No. 1, dated as of October 27, 2014, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U. S. Bank National Association, as lender (filed as Exhibit 10.2 of South State Corporation’s Current Report on Form 8-K, filed on October 31, 2014, and incorporated herein by reference)

10.3		Amendment No. 2, dated November 5, 2015, executed an amendment to its credit agreement with the Lender, U. S. Bank National Association to extend its $20.0 million unsecured line of credit through November 15, 2015 (filed under Item 5, Other information, of South State Corporation’s Form 10-Q, filed on November 6, 2015, and incorporated herein by reference)

10.4		Amendment No. 3, dated as of November 16, 2015, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U.S. Bank National Association, as lender (filed under Item 1.01, Entry into a Material Definitive Agreement, of South State Corporation’s Form 8-K, filed on November 20, 2015, and incorporated herein by reference)

10.5

Amendment No. 4, dated as of November 15, 2016, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U.S. Bank National Association, as lender

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


		SOUTH STATE CORPORATION
		(Registrant)

Date:	November 17, 2016	/s/ John C. Pollok
		John C. Pollok
		Senior Executive Vice President,
		Chief Financial Officer and
		Chief Operating Officer

Exhibit Index


Exhibit No.		Description

10.1		Credit Agreement, dated as of October 28, 2013, by and between First Financial Holdings, Inc., as borrower, and U.S. Bank National Association, as lender (filed as Exhibit 10.1 of First Financial Holdings, Inc.’s Current Report on Form 8-K, filed on October 29, 2013, and incorporated herein by reference)

10.2		Amendment No. 1, dated as of October 27, 2014, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U. S. Bank National Association, as lender (filed as Exhibit 10.2 of South State Corporation’s Current Report on Form 8-K, filed on October 31, 2014, and incorporated herein by reference)

10.3		Amendment No. 2, dated November 5, 2015, executed an amendment to its credit agreement with the Lender, U. S. Bank National Association to extend its $20.0 million unsecured line of credit through November 15, 2015 (filed under Item 5, Other information, of South State Corporation’s Form 10-Q, filed on November 6, 2015, and incorporated herein by reference)

10.4		Amendment No. 3, dated as of November 16, 2015, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U.S. Bank National Association, as lender (filed under Item 1.01, Entry into a Material Definitive Agreement, of South State Corporation’s Form 8-K, filed on November 20, 2015, and incorporated herein by reference)

10.5		Amendment No. 4, dated as of November 15, 2016, to Credit Agreement, dated as of October 28, 2013, by and between South State Corporation, as borrower, and U.S. Bank National Association, as lender

Exhibit 10.5

AMENDMENT NO. 4

Dated as of November 15, 2016

to and under

Credit Agreement
Dated as of October 28, 2013, as Amended

Each of SOUTH STATE CORPORATION, formerly known as “First Financial Holdings, Inc.” (the “ Company ”), and U.S. BANK NATIONAL ASSOCIATION (the “ Lender ”) agree as follows:

1. Credit Agreement .

Reference is made to the Credit Agreement, dated as of October 28, 2013, between the Company and the Lender, as amended by Amendment No. 1, dated as of October 27, 2014 (“ Amendment No. 1 ”), between the Company and the Lender, and as further amended by the Agreement to Reinstate and Amendment No. 2, dated as of November 5, 2015 (“ Amendment No. 2 ”), between the Company and the Lender, and as further amended by Amendment No. 3, dated as of November 16, 2015 (“ Amendment No. 3 ”), between the Company and the Lender (said credit agreement, as so amended, the “ Credit Agreement ”). Terms used but not defined in this Amendment No. 4 (this “ Amendment ”) shall have the meanings ascribed to them in the Credit Agreement.

2. Amendments . On and after the Effective Date (as defined in Section 5 below), the Credit Agreement shall be amended as hereinafter set forth.

(a) The first Recital to the Credit Agreement shall be amended by deleting the first sentence thereof in its entirety and replacing it with the following sentence: “The Company has requested that the Lender extend to it credit in the aggregate principal amount not to exceed $10,000,000 in the form of Revolving Loans.”

(b) Section 1.1(a) shall be amended:

(i) by deleting the definition of “ Business Combination ” in its entirety and reserving said definition for future use;

(ii) by deleting the definition of “ CP Balance ” in its entirety and replacing it with the following:

“‘ Investment Balance’ shall mean, with respect to any Fiscal Quarter, the average aggregate balance of U.S. Bank National Association convertible money market deposit account and Eurodollar investments held by the Company and each Bank Subsidiary with Lender during such Fiscal Quarter, which investments are subject to partial or total redemption at the option of the investor by not less than thirty-one (31) calendar days prior oral and written notification to the Lender.”;

(iii) by deleting the definition of “ Commitment Fee Percentage ” in its entirety and replacing it with the following:

“‘ Commitment Fee Percentage ’ shall mean, for any Fiscal Quarter (or portion thereof), (a) 0.275%, if the Investment Balance for such Fiscal Quarter is less than $5,000,000, (b) 0.155%, if the Investment Balance for such Fiscal Quarter is at least $5,000,000 but less than $10,000,000, and (c) 0.035%, if the Investment Balance for such Fiscal Quarter is at least $10,000,000.”;

(iv) by deleting the definition of “ Facility Usage Adjustment Percentage ” in its entirety and reserving said definition for future use;

(v) by deleting the definitions of “ FAS 141 ”, “ FAS 141 Acquisition Effective Date ” and “ Non-Acquired Loans ” in their entirety and reserving said definitions for future use;

(vi) by deleting the defined term “ Non-Acquired Non-Performing Asset Amount ” and replacing said term with the defined term “ Non-Performing Asset Amount ”;

(vii) by deleting the definition of “ Non-Acquired Non-Performing Assets to Tangible Capital Ratio ” in its entirety and replacing said definition with the following:

‘“ Non-Performing Assets to Tangible Capital Ratio ” shall mean, as of any date of determination, the ratio, expressed as a percentage, of (a) the Non-Performing Asset Amount of the Company and the Bank Subsidiaries as of such date to (b) the Tangible Capital of the Company and the Bank Subsidiaries as of such date, in each case determined on a consolidated basis.”;

(viii) by deleting the definition of “ Non-Performing Loan Amount ” in its entirety and replacing it with the following:

‘“ Non-Performing Loan Amount ” shall mean, of each Bank Subsidiary as of any date of determination, an amount equal to (a) the aggregate principal amount (including any capitalized interest) of all non-accruing loans of such Bank Subsidiary as of such date, plus (b) the aggregate principal amount of all loans of such Bank Subsidiary that are ninety (90) days or more past due and still accruing as of such date, minus (c) the aggregate principal amount set forth in item 11.f. (Columns B and C) on Schedule RC-N of the quarterly Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only – Federal Financial Institution Examination Counsel Form 041 most recently filed by such Bank Subsidiary with the appropriate Regulatory Authorities.”;

(ix) by deleting the definition of “ OREO Amount ” in its entirety and replacing it with the following:

‘“ OREO Amount ” shall mean, of each Bank Subsidiary as of any date of determination, 100% of the aggregate principal amount set forth in item 3.f. on Schedule RC-M of the quarterly Consolidated Reports of Condition and Income for A Bank with Domestic Offices Only – Federal Financial Institution Examination Counsel Form 041 most recently filed by such Bank Subsidiary with the appropriate Regulatory Authorities, minus the aggregate principal amount set forth in item 13.b.7. on Schedule RC-M of the quarterly Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only – Federal Financial Institution Examination Counsel Form 041 most recently filed by such Bank Subsidiary with the appropriate Regulatory Authorities.”;

(x) by deleting the amount “$20,000,000” where it appears in the definition of “ Revolving Loan Commitment ” and replacing said amount with “$10,000,000”; and

(xi) by deleting the date “November 15, 2016” where it appears in the definition of “ Termination Date ” and replacing said date with “November 15, 2017”.

(c) The term “Non-Acquired Non-Performing Assets to Tangible Capital Ratio” shall be deleted where it appears in the second and third lines of Section 5.11(d) of the Credit Agreement and shall be replaced with the term “Non-Performing Assets to Tangible Capital Ratio”.

3. Continuing Effect of Credit Agreement . The provisions of the Credit Agreement, as amended by the amendments in Section 2 hereof, are and shall remain in full force and effect and are hereby in all respects confirmed, approved and ratified.

4. Representations and Warranties . In order to induce the Lender to agree to the amendment contained herein, the Company hereby represents and warrants as follows:

(a) The Company has the power, and has taken all necessary action to authorize it, to execute, deliver and perform in accordance with their respective terms, this Amendment and the Credit Agreement as amended by this Amendment. This Amendment has been duly executed and delivered by the duly authorized officers of the Company and is, and the Credit Agreement as amended by this Amendment is, the legal, valid and binding obligation of the Company enforceable in accordance with its terms.

(b) Each of the representations and warranties set forth in Section 3 of the Credit Agreement, after giving effect to this Amendment, shall be made at and as of the Effective Date, except to the extent that any such representations or warranties are made as of a specified date or with respect to a specified period of time, in which case such representations and warranties shall be made as of such specified date or with respect to such specified period.

5. Conditions to Effectiveness . This Amendment shall be effective as of November 15, 2016 (the “ Effective Date ”), but only after the Lender, in its sole discretion, shall have determined that each of the following conditions has been satisfied by the Company or waived by the Lender:

(a) The Lender shall have received each of the following in form and substance satisfactory to it:

(i) this Amendment duly executed by the Company and the Lender;

(ii) an incumbency certificate, dated the Effective Date, executed by the secretary or assistant secretary of the Company, which shall identify by name and title, and bear the signature of, each officer of the Company authorized to sign this Amendment and the documents delivered by the Company hereunder and to effect the amendments contemplated hereby (each such officer, an “ Authorized Officer ”);

(iii) either a copy of the by-laws of the Company, certified on the Effective Date by the secretary or assistant secretary of the Company, or a certificate, dated the Effective Date, of the secretary or assistant secretary of the Company certifying that the by-laws of the Company, as delivered to the Lender under Section 4.1 of the Credit Agreement, remain in full force and effect without amendment or modification of any kind;

(iv) either a copy of the by-laws of South State Bank, certified on the Effective Date by the secretary or assistant secretary of the South State Bank, or a certificate, dated the Effective Date, of the secretary or assistant secretary of South State Bank certifying that the by-laws of South State Bank, as delivered to the Lender under Section 4.1 of the Credit Agreement, remain in full force and effect without amendment or modification of any kind;

(v) a Certificate of Existence for the Company, issued by the Office of the Secretary of State of South Carolina, and either certified copies of the Articles of Incorporation of the Company, issued by the Office of the Secretary of State of South Carolina, or a certificate, dated the Effective Date, of the secretary or assistant secretary of the Company certifying that the Articles of Incorporation of the Company, as delivered to the Lender under Section 4.1 of the Credit Agreement, remain in full force and effect without amendment or modification of any kind;

(vi) a Certificate of Existence for South State Bank, issued by the Office of the Secretary of State of South Carolina, and either certified copies of the Articles of Incorporation of South State Bank, issued by the Office of the Secretary of State of South Carolina, or a certificate, dated the Effective Date, of the secretary or assistant secretary of South State Bank certifying that the Articles of Incorporation of South State Bank, as delivered to the Lender under Section 5(a)(vi) of Amendment No. 3, remain in full force and effect without amendment or modification of any kind;

(vii) copies (in form and substance satisfactory to the Lender), certified on the Effective Date by the secretary or assistant secretary of the Company, of resolutions of the Company authorizing the execution and delivery of this Amendment;

(viii) a certificate, dated the Effective Date, of an Authorized Officer stating that each representation made or deemed made under Section 4 of this Amendment is true and correct on and as of such date or, in the case of any such representation or warranty that is made as of a specified date or with respect to a specified period of time, as of such specified date or with respect to such specified period and that all conditions precedent to the Effective Date have been satisfied by the Company;

(ix) an opinion of counsel for the Company, who may be in-house counsel, dated the Effective Date, with respect to this Amendment, the Credit Agreement as amended hereby, and the matters contemplated hereby and thereby;

(x) an Amended and Restated Revolving Credit Note duly executed by the Company; and

(xi) such other information, documents or materials as the Lender may have reasonably requested.

6. Governing Law . This Amendment shall, pursuant to New York General Obligations Law 5-1401, be construed in accordance with and governed by the law of the State of New York.

7. Counterparts . This Amendment may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto were upon the same instrument.

8. Headings . Section headings in this Amendment are included herein for convenience and reference only and shall not constitute a part of this Amendment for any other purpose.

[Signature page follows.]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly authorized officers all as of the date hereinabove set forth.


	SOUTH STATE CORPORATION

	By:	/s/Richard C. Mathis
	Name:	Richard C. Mathis
	Title:	EVP & Treasurer

	U.S. BANK NATIONAL ASSOCIATION

	By:	/s/ Jeffrey P. Googins
	Name:	Jeffrey P. Googins
	Title:	Senior Vice President