Fourth Amendment to Amended and Restated Revolving Credit Agreement
Fourth
Amendment to Amended and Restated Revolving Credit
Agreement
This
Fourth Amendment to Amended and Restated Revolving Credit Agreement (herein,
the
“Amendment”)
is
entered into as of August 4, 2008, by and among World Acceptance
Corporation, a South Carolina corporation (the “Borrower”),
the
Banks party hereto, Bank of Montreal, as Agent for the Banks (the “Agent”).
Preliminary
Statements
A.The
Borrower, the Banks, JPMorgan Chase Bank as Co-Agent, and the Agent are parties
to a certain Amended and Restated Revolving Credit Agreement, dated as of
July 20, 2005, as amended (the “Credit
Agreement”).
All
capitalized terms used herein without definition shall have the same meanings
herein as such terms have in the Credit Agreement.
B.The
Borrower has requested that the Banks extend the Termination Date, amend certain
provisions relating to investments in non-Restricted Subsidiaries, and make
certain other amendments to the Credit Agreement, and the Banks are willing
to
do so under the terms and conditions set forth in this Amendment.
Now,
Therefore, for
good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
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Section 1.
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Amendments.
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Subject
to the satisfaction of the conditions precedent set forth in Section 2
below, the Credit Agreement shall be and hereby is amended as
follows:
1.1.Subsection (d)
of the second paragraph of Section 3.5 of the Credit Agreement (Place and
Application of Payments) shall be amended and restated to read as
follows:
(d) fourth,
to the Agent and the Banks (and, in the case of Hedging Liability, their
Affiliates) ratably in accord with the amounts of any other indebtedness,
obligations or liabilities of the Borrower owing to each of them and secured
by
the Collateral Documents (including, without limitation, Hedging Liability)
unless and until all such indebtedness, obligations and liabilities have been
fully paid and satisfied;
1.2.The
first
sentence of Section 4.1 of the Credit Agreement (The Collateral) shall be
amended and restated to read as follows:
The
Obligations shall be secured by valid and perfected first priority Liens
pursuant to the Company Security Agreement and the Subsidiary Security Agreement
in favor of the Security Trustee for the benefit of the Banks on all of the
Borrower’s and each of its Restricted Subsidiaries’ (other than the Insurance
Subsidiary’s) now existing and hereafter arising or acquired accounts, general
intangibles, instruments, documents, chattel paper, investment property,
inventory, equipment, deposit accounts, and other goods together with all
records and proceeds relating thereto as well as on all capital stock or other
equity interests of each Subsidiary and all proceeds thereof; provided,
however,
that
the lien on the Voting Stock of the Insurance Subsidiary and any other Foreign
Subsidiary shall be limited to 66% of the total outstanding Voting Stock of
the
Insurance Subsidiary and any other Foreign Subsidiary.
1.3.Section 4.2
of the Credit Agreement (Subsidiary Guaranties) shall be amended and restated
to
read as follows:
Section 4.2. Subsidiary
Guaranties.
Payment
of the Obligations shall at all times be guarantied by each of the Restricted
Subsidiaries (other than the Insurance Subsidiary) pursuant to the Subsidiary
Guaranty Agreement.
1.4.Section 5.1
of the Credit Agreement (Definitions) shall be amended by (a) adding in
appropriate alphabetical order a definition of “Hedging
Liability”
and
(b) amending and restating the definitions of “Collateral
Documents,” “Obligations,” and“Termination
Date”
which
shall instead read as follows:
“Collateral
Documents” means
the
Company Security Agreement, the Subsidiary Security Agreement, and all other
security agreements, financing statements and other documents as shall from
time
to time secure or relate to the Obligations or any part thereof.
“Hedging
Liability”
means
the liability of the Borrower or any Restricted Subsidiaries party to the
Subsidiary Guaranty Agreement to any of the Banks, or any Affiliates of such
Banks, in respect of any interest rate, foreign currency, and/or commodity
swap,
exchange, cap, collar, floor, forward, future or option agreement, or any other
similar interest rate, currency or commodity hedging arrangement, as the
Borrower or such Restricted Subsidiary, as the case may be, may from time to
time enter into with any one or more of the Banks party to this Agreement or
their Affiliates.
“Obligations”
means
all unpaid principal of and accrued and unpaid interest on the Notes, all
Hedging Liability, all accrued and unpaid fees and all other obligations of
the
Borrower or any Restricted Subsidiary to the Banks or any Bank or the Agent
or
the Security Trustee arising under the Loan Documents, in each case whether
now
existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired.
“Termination
Date”
means
September 30, 2010, or such later date to which the Commitments are
extended pursuant to Section 3.4 hereof, or such earlier date on which the
Commitments are terminated in whole pursuant to Sections 2.9, 9.3 or 9.4
hereof.
1.5.Section 8.9(e)
of the Credit Agreement (Permitted Indebtedness) shall be amended and restated
in its entirety to read as follows:
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(e) other
unsecured Indebtedness for Borrowed Money to any Person (other than to the
Borrower or another Restricted Subsidiary) in an aggregate amount for the
Borrower and all Restricted Subsidiaries not exceeding $5,000,000 at any time
outstanding.
1.6.Section 8.18(g)
of the Credit Agreement (Investments) shall be amended and restated in its
entirety and a new subsection (h) shall be added immediately thereafter, to
read as follows:
(g) Investments
by the Borrower in WAC de México, S.A. de C.V., SOFOM, ENR and
Servicios World Acceptance Corporation de México, S. de X.X.
de C.V. (collectively, the “Mexican
Subsidiaries”)
in an
aggregate amount not to exceed $35,000,000 at any one time outstanding;
and
(h) other
Investments (in addition to those permitted in clauses (a) through (g) above),
including for purposes hereof Investments in all Unrestricted Subsidiaries
other
than the Mexican Subsidiaries set forth in subsection (g) above,
provided
that
(i) the aggregate amount of Investments in all Unrestricted Subsidiaries
organized outside of the United States of America (other than the Mexican
Subsidiaries set forth in subsection (g) above) shall not at any time
exceed 3% of Consolidated Adjusted Net Worth and (ii) the aggregate amount
of all such other Investments (including Investments in Unrestricted
Subsidiaries other than the Mexican Subsidiaries set forth in
subsection (g) above) shall not at any time exceed 10% of Consolidated
Adjusted Net Worth.
1.7.Section 11
of the Credit Agreement (The Agent) shall be amended by (a) amending and
restating Section 11.11 in its entirety and (b) adding a new Section
11.13, each of which shall read as follows:
Section 11.11. Authorization
to Release or Subordinate or Limit Liens. The
Agent
is hereby irrevocably authorized by each of the Banks to authorize the Security
Trustee to (a) release any Lien covering any Collateral that is sold,
transferred, or otherwise disposed of in accordance with the terms and
conditions of this Agreement and the relevant Collateral Documents (including
a
sale, transfer, or disposition permitted by the terms of Section 8.13
hereof or which has otherwise been consented to in accordance with
Section 12.11 hereof), (b) release or subordinate any Lien on
Collateral consisting of goods financed with purchase money indebtedness or
under a Capital Lease to the extent such purchase money indebtedness or
Capitalized Lease Obligation, and the Lien securing the same, are permitted
by
Sections 8.9, 8.10, and 8.11 hereof, (c) reduce or limit the amount of
the indebtedness secured by any particular item of Collateral to an amount
not
less than the estimated value thereof to the extent necessary to reduce mortgage
registry, filing and similar tax and (d) release Liens on the Collateral
following termination or expiration of the Commitments and payment in full
in
cash of the Obligations.
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Section 11.13. Hedging
Liability.
By
virtue of a Bank’s execution of this Agreement or an assignment agreement
pursuant to Section 12.10 hereof, as the case may be, any Affiliate of such
Lender with whom the Borrower or any Restricted Subsidiary has entered into
an
agreement creating Hedging Liability shall be deemed a Bank party hereto for
purposes of any reference in a Loan Document to the parties for whom the Agent
or the Security Trustee is acting, it being understood and agreed that the
rights and benefits of such Affiliate under the Loan Documents consist
exclusively of such Affiliate’s right to share in payments and collections out
of the Collateral and the Subsidiary Guaranty Agreement as more fully set forth
in Section 3.5 hereof. In connection with any such distribution of payments
and collections, or any request for the release of the Subsidiary Guaranty
Agreement and the Security Trustee’s Liens in connection with the termination of
the Commitments and the payment in full of the Obligations, the Agent and the
Security Trustee shall be entitled to assume no amounts are due to any Bank
or
its Affiliate with respect to Hedging Liability unless such Bank has notified
the Agent and the Security Trustee in writing of the amount of any such
liability owed to it or its Affiliate prior to such distribution or payment
or
release of Subsidiary Guaranty Agreement and Liens.
1.8.Schedule 6.2
to the Credit Agreement (Subsidiaries) shall be amended by striking reference
to
the Subsidiary by the name of “World Acceptance Corporation de México,
S. de X.X. de C.V.” and inserting in its place the name “WAC de
México, S.A. de C.V., SOFOM, ENR” which shall be accompanied by the
following information:
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Name
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Jurisdiction of
Organization
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Owner
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Percentage
Ownership
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WAC de México, S.A. de C.V.,
SOFOM, ENR
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Mexico
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World Acceptance Corporation (99%)
and WFC Services, Inc., a South
Carolina corporation (1%)
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100%
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Section 2. Conditions Precedent.
The effectiveness of this Amendment is subject
to the satisfaction of all of the following conditions precedent:
2.1.The
Borrower and the Required Banks shall have executed and delivered this
Amendment.
2.2.The
Restricted Subsidiaries parties to the Subsidiary Guaranty Agreement shall
have
executed and delivered to the Agent their consent to this Amendment in the
form
set forth below.
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2.3.The
Restricted Subsidiaries and the Security Trustee shall have executed a First
Amendment to the Subsidiary Guaranty Agreement in the form attached hereto
as
Annex A (and each of the Banks hereby authorize and instruct the Security
Trustee to execute and delver the First Amendment to the Subsidiary Guaranty
Agreement in the form attached hereto as Annex A).
0.0.Xxxxx
matters incident to the execution and delivery of this Amendment shall be
satisfactory to the Agent and its counsel.
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Section 3.
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Representations.
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In
order
to induce the Banks to execute and deliver this Amendment, the Borrower hereby
represents to the Agent, the Security Trustee, and the Banks that as of the
date
hereof, after giving effect to the amendments set forth in Section 1 above,
(a) the representations and warranties set forth in Section 6 of the Credit
Agreement and in the other Loan Documents are and shall be and remain true
and
correct (except that the representations contained in Section 6.6 shall be
deemed to refer to the most recent financial statements of the Borrower
delivered to the Agent) and (b) the Borrower and the Guarantors are in
compliance with the terms and conditions of the Credit Agreement and the other
Loan Documents and no Default or Event of Default exists or shall result after
giving effect to this Amendment.
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Section 4.
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Miscellaneous.
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4.1.Except
as
specifically amended herein, the Credit Agreement shall continue in full force
and effect in accordance with its original terms. Reference to this specific
Amendment need not be made in the Credit Agreement, the Notes, or any other
instrument or document executed in connection therewith, or in any certificate,
letter or communication issued or made pursuant to or with respect to the Credit
Agreement, any reference in any of such items to the Credit Agreement being
sufficient to refer to the Credit Agreement as amended hereby.
4.2.The
Borrower heretofore executed and delivered, among other things, the Company
Security Agreement and hereby acknowledges and agrees that the security
interests and liens created and provided for therein secure the payment and
performance of the Obligations as amended hereby, which are entitled to all
of
the benefits and privileges set forth therein. Without limiting the foregoing,
the Borrower acknowledges that the “Secured Indebtedness” as defined in the
Company Security Agreement includes all Hedging Liability in addition to all
other Obligations as originally defined therein.
4.3.The
Borrower agrees to pay on demand all costs and expenses of or incurred by the
Agent in connection with the negotiation, preparation, execution and delivery
of
this Amendment and the other instruments and documents to be executed and
delivered in connection herewith, including the fees and expenses of counsel
for
the Agent.
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4.4.This
Amendment may be executed in any number of counterparts, and by the different
parties on different counterpart signature pages, all of which taken together
shall constitute one and the same agreement. Any of the parties hereto may
execute this Amendment by signing any such counterpart and each of such
counterparts shall for all purposes be deemed to be an original. Delivery of
a
counterpart hereof by facsimile transmission or by e-mail transmission of an
Adobe Portable Document Format File (also known as an “PDF” file)
shall be effective as delivery of a manually executed counterpart hereof. This
Amendment shall be governed by, and construed in accordance with, the internal
laws of the State of Illinois (without regard to principles of conflicts of
laws).
[Signature
Page to Follow]
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This
Fourth Amendment to Amended and Restated Revolving Credit Agreement is entered
into as of the date and year first above written.
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World
Acceptance Corporation
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By:
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/s/
A. Xxxxxxxxx XxXxxx, III
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Name:
A. Xxxxxxxxx XxXxxx, III
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Title:
Chief Executive Officer
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Accepted
and agreed to.
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Bank
of Montreal,
in its capacity as Agent
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By:
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/s/
Xxxxxxx X. Xxxxxx
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Name:
Xxxxxxx X. Xxxxxx
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Title:
Director
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BMO
Capital Markets Financing, Inc.
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By
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/s/ Xxxxxxx X. Xxxxxx | ||
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Name
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Xxxxxxx X. Xxxxxx | ||
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Title
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Director | ||
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JPMorgan
Chase Bank, N.A.
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By:
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/s/
Xxxxxxx Xxxxxxxxx
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Name:
Xxxxxxx Xxxxxxxxx
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Title:
Vice President
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Bank
of America, N.A.
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By:
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/s/
Xxxxxxx Xxxxxx
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Name:
Xxxxxxx Xxxxxx
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Title: Vice
President
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Capital
One, National Association
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By:
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/s/
Xxxx Xxxxxxxx
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Name: Xxxx
Xxxxxxxx
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Title:
Executive Vice President
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Xxxxx
Fargo Financial Preferred Capital, Inc.
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By:
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/s/
Xxxxxxx Xxxxx
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Name:
Xxxxxxx Xxxxx
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Title:
Senior Vice President
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Carolina
First Bank
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By:
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/s/
Xxxx X. Xxxxxxx
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Name:
Xxxx X. Xxxxxxx
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Title:
Vice President
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Acknowledgement
and Consent
Each
of
the undersigned is a Restricted Subsidiary of World Acceptance Corporation
who
has executed and delivered to the Security Trustee, the Agent, and the Banks
the
Subsidiary Guaranty Agreement and the Subsidiary Security Agreement. Each of
the
undersigned hereby acknowledges and consents to the Fourth Amendment to Amended
and Restated Revolving Credit Agreement set forth above and confirms that the
Loan Documents executed by it, and all of its obligations thereunder, remain
in
full force and effect, and that the security interests and liens created and
provided for therein continue to secure the payment and performance of the
Obligations of the Borrower under the Credit Agreement after giving effect
to
the Amendment. Without limiting the foregoing, each of the undersigned
acknowledges that the “Secured Indebtedness” as defined in the Subsidiary
Security Agreement includes all Hedging Liability in addition to all other
Obligations as originally defined therein. Each of the undersigned acknowledges
that the Security Trustee, the Agent, and the Banks are relying on the foregoing
in entering into the Amendment.
Dated
as
of August 4, 2008.
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World
Acceptance Corporation of Alabama
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World
Acceptance Corporation of Missouri
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World
Finance Corporation of Georgia
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World
Finance Corporation of Louisiana
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World
Acceptance Corporation of Oklahoma, Inc.
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World
Finance Corporation of South Carolina
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World
Finance Corporation of Tennessee
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WFC
of South Carolina, Inc.
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World
Finance Corporation of Illinois
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World
Finance Corporation of New Mexico
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World
Finance Corporation of Kentucky
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WFC
Services, Inc.,
a
South Carolina corporation
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World
Finance Corporation of Colorado
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By
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/s/ A. Xxxxxxxxx XxXxxx, III |
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A.
Xxxxxxxxx XxXxxx, III
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Its
Chief Executive Officer
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| WFC Limited Partnership | |
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By
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WFC
of South Carolina, Inc., as sole general
partner
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By
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/s/
A. Xxxxxxxxx XxXxxx, III
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A.
Xxxxxxxxx XxXxxx, III
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Its
Chief Executive Officer
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World
Finance Corporation of Texas
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By
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/s/
Xxxx X. Xxxxxx
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Xxxx
X. Xxxxxx
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Its
President
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