EXHIBIT 10.16.3
THIRD AMENDMENT TO
AMENDED AND RESTATED LOAN AGREEMENT
Dated as of: February 6, 2004
Parties: Lithia Financial Corporation ("LFC")
Lithia Motors, Inc. ("LMI")
Lithia Aircraft, Inc. ("LAI")
and: U.S. BANK NATIONAL ASSOCIATION ("Lender")
This Agreement amends the Amended and Restated Loan Agreement between
the parties and Lithia Salmir, Inc. dated as of December 28, 2001, as amended by
agreements dated January 31, 2003 and April 2, 2003 (collectively, the "Loan
Agreement").
For valuable consideration, the parties agree as follows:
1. AMENDMENTS TO LOAN AGREEMENT.
1.1 The definitions of the following terms in Section 1.1
of the Loan Agreement are deleted and replaced with the following:
"Maximum Revolving Loan Amount" means, as of any date of
determination, an amount equal to $50,000,000.00 minus the then
outstanding aggregate principal balance of the Term-Out Notes.
"Revolving Loan Termination Date" means January 31, 2006.
1.2 Section 3.3.1 of the Loan Agreement is deleted and
replaced with the following:
3.3.1 NOTE. The Revolving Loans shall be evidenced by
a promissory note executed by LFC and LAI in the principal amount of
$50,000,000.00, substantially in the form attached as Exhibit A ("New
Revolving Note"). The Revolving Loans shall be subject to all terms and
conditions of the New Revolving Note and of this Agreement.
1.3 Section 3.3.3 of the Loan Agreement is deleted and
replaced with the following:
3.3.3 PRINCIPAL PAYMENTS. The principal balance of
the New Revolving Note shall be due and payable on January 31, 2006.
Page 1
1.4 The last sentence of Section 3.4.1 of the Loan
Agreement is deleted and replaced with the following:
The sum of the principal balance of the New Revolving Note plus the
aggregate principal balance of all Term-Out Notes shall at no time
exceed $50,000,000.00, or if less, the amount required to maintain
compliance with Section 9.1.7.
1.5 Sections 9.1.1 and 9.1.2 of the Loan Agreement are
deleted and replaced with the following:
9.1.1 LMI CURRENT RATIO. LMI and its subsidiaries shall
maintain, on a consolidated basis, as of the last day of each fiscal
quarter ending on or after December 31, 2002, a ratio of current assets
to current liabilities of at least 1.20 to 1.0.
9.1.2 LMI MINIMUM TOTAL NET WORTH. LMI and its subsidiaries
shall maintain, on a consolidated basis, Total Net Worth of not less
than (a) $260,000,000.00, plus (b) 100% of the value of the net
proceeds (cash or non-cash) received by LMI from the issuance of
capital stock after December 31,2003.
1.6 Section 9.1.5 of the Loan Agreement is deleted and
replaced with the following:
9.1.5 MINIMUM TANGIBLE NET WORTH. The sum of LFC's Tangible
Net Worth plus the principal balance, up to a maximum of $4,500,000, of
loans made by LFC to its affiliates (excluding any amounts owed by such
affiliates to LFC under leases between LFC and such affiliates) shall
not be less than the sum of (a) $18,000,000.00, plus (b) 50% of the
cumulative sum of LFC's net income after taxes (without reduction for
any losses) for each fiscal year ending on or after December 31,2004
(such increase to become effective on December 31,2004 and on the last
day of each fiscal year thereafter with respect to net income for such
fiscal year).
1.7 Section 9.1.7 of the Loan Agreement is deleted and
replaced with the following:
9.1.7 BORROWING BASE AMOUNT. The Borrowing Base Amount
shall at all times be at least equal to the sum of the then outstanding
principal balance of the New Revolving Note and the aggregate principal
balance of the Term Notes.
As used herein:
"Borrowing Base Amount" means an amount equal to the sum of
(i) 100% of LFC's cash minus book overdraft, if any; plus (ii) 75% of
the net book value of aircraft owned by LAI; plus (iii) 80% of the net
book value of LFC's inventory of vehicles leased by LFC to third
parties; plus (iv) 80% of the net book value LFC's inventory of used
vehicles (excluding amounts included in clause (iii)); plus (v) 50%
Page 2
of accounts owed to LFC by Persons other than LAI, which are not more
than 90 days past due; (vi) plus 35% of the net book value of LFC's
equipment.
1.8 Exhibit A to the Loan Agreement is deleted and
replaced with the Exhibit A attached hereto.
2. CONDITIONS PRECEDENT. The effectiveness of this Agreement is
subject to satisfaction of each of the following conditions:
2.1 Lender has received executed originals of this
Agreement, a new New Revolving Note and such other Loan Documents as Lender
requires and each Loan Party has provided such information and satisfied such
requirements as Lender reasonably requires.
2.2 No Default has occurred and is continuing.
2.3 All representations and warranties in the Loan
Agreement are true and correct as of the date of this Agreement.
3. DEFINED TERMS. Capitalized terms not otherwise defined herein
shall have the meanings given to such terms in the Loan Agreement.
4. REAFFIRMATION. Each Loan Party reaffirms the representations
and warranties in each of the existing Loan Documents and agrees that (a) except
as amended previously or in connection herewith, each Loan Document is and shall
remain valid and enforceable in accordance with its terms and (b) such Loan
Party has no claims, defenses, setoffs, counterclaims or claims for recoupment
against Lender or the indebtedness and obligations represented by the Notes,
Guaranties, LC Agreements, Letter of Credit, and other Loan Documents.
5. EXPENSES. Borrower shall pay all costs, fees and expenses
incurred by Lender in connection with the preparation, negotiation, execution,
and delivery of this Agreement and any other document required to be furnished
herewith, including without limitation the charges of Lender's legal counsel.
6. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of said
counterparts taken together shall be deemed to constitute but one document.
7. COPIES. Each Loan Party acknowledges receipt of a copy of this
amendment. The Loan Agreement and New Revolving Note, together with all
amendments thereto from time to time, are "transferable records" as defined in
applicable law relating to electronic transactions. Therefore, Lender may, on
behalf of Borrower, create a microfilm or optical disk or other electronic image
of the Loan Agreement and New Revolving Note (and all amendments thereto) that
is an authoritative copy of the Loan Agreement and New Revolving Note as defined
in such law. Lender may store the authoritative copy in its electronic form and
then destroy the paper original as part of Lender's normal business practices.
Lender, on its own behalf, may control and transfer such authoritative copy as
permitted by such law.
Page 3
8. DISCLOSURE.
UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY
LENDERS CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL,
FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST
BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY THE LENDER TO BE
ENFORCEABLE.
Each Loan Party acknowledges receipt of a copy of this Agreement.
LITHIA FINANCIAL CORPORATION LITHIA MOTORS, INC.
By: Xxxxxxx X.XxXxxx By: Xxxxxxx X. XxXxxx
-------------------------------- --------------------------
Its: Secretary and Treasurer Its: Chief Financial Officer
LITHIA AIRCRAFT, INC. U.S. BANK NATIONAL ASSOCIATION
By: Xxxxxxx X.XxXxxx By: Xxxxx Xxxxxxxx
-------------------------------- --------------------------
Its: Secretary and Treasurer Its: Senior Vice President
Page 4
