THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT
Exhibit
4.10
THIRD
AMENDMENT TO REVOLVING CREDIT AGREEMENT
THIS
THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT
("Amendment") is dated effective as of April 28, 2006, by and among AMERICA’S
CAR MART, INC.,
an
Arkansas corporation and TEXAS
CAR-MART, INC.,
a Texas
corporation (separately and collectively, “Borrower”) and BANK
OF OKLAHOMA, N.A.
(“Bank”).
RECITALS
A. Reference
is made to the Revolving Credit Agreement dated as of June 23, 2005, and amended
by the First Amendment to Revolving Credit Agreement, dated effective as of
June
23, 2005, and executed August 19, 2005, and the Second Amendment to Revolving
Credit Agreement, dated effective as of September 30, 2005 (as amended, the
"ACM
Credit Agreement"), by and among Borrowers and Bank, pursuant to which the
Bank
established a $10,000,000 Revolving Line of Credit in favor of Borrower for
the
purpose of refinancing existing indebtedness and for working capital needs
and
general business purposes.
B. Borrower
has requested that Bank establish a $10,000,000 term loan in favor of Borrower;
and Bank has agreed to accommodate Borrower’s request, subject to the terms and
conditions hereof. Terms used herein shall have the meanings given in the ACM
Credit Agreement unless otherwise defined herein.
AGREEMENT
For
valuable consideration received, the parties agree to the
following.
1. Amendments
to ACM Credit Agreement.
The ACM
Credit Agreement is amended as follows.
1.1. In
Section 1.01 (Defined Terms), the definitions of “Borrowing Base” and “Borrowing
Base Certificate” are hereby deleted in their entirety.
1.2. In
Section 1.01 (Defined Terms), the definition of “Collateral” is hereby deleted
and replaced with the following:
“’Collateral’
means all property which is subject or is to be subject to the Liens granted
by
the Security Agreement-Borrower, the Security Agreement-Colonial, and the
Mortgages.”
1.3. In
Section 1.01 (Defined Terms), the definition of “Commitment” is hereby deleted
and replaced with the following:
“’Commitment’
means the Bank’s obligation to make Revolving Credit Loans to the Borrower
pursuant to Section 2.01(a) hereof in the amount of $10,000,000.”
1.4. In
Section 1.01 (Defined Terms), the definition of “Loan Documents” is hereby
deleted and replaced with the following:
“’Loan
Documents’ means this Agreement, the Note, the Security Agreement-Borrower, the
Security Agreement-Colonial, the Guaranty, and the Mortgages, and any
extensions, modifications, and amendments thereto.”
1.5. In
Section 1.01 (Defined Terms), the definition of “Note” is hereby deleted and
replaced with the following:
“’Note’
means, separately and collectively, the Revolving Credit Note and the Term
Note.”
1.6. New
defined terms are hereby added to Section 1.01 (Defined Terms), as
follows:
“’Colonial
Credit Agreement’ means the Amended and Restated Agented Revolving Credit
Agreement between Colonial and Bank of Arkansas, N.A., et al., dated June 23,
2005, and subsequently amended from time to time.
’Mortgages’
means, separately and collectively, the mortgage/deed of trust documents
covering each of the Mortgaged Properties, in form and content as set forth
on
Exhibit
‘L’.
‘Mortgaged
Property’ means, separately and collectively, the tracts of real property
described on Exhibit
‘M’
hereto.
‘Revolving
Credit Note’ means the $10,000,000 Promissory Note evidencing the Revolving
Credit Loans.
‘Term
Loan’ means the loan described in Section 2.01(b) hereof.
‘Term
Note’ means the $10,000,000 Promissory Note evidencing the Term
Loan.”
1.7. Section
2.01 (Revolving Credit) is hereby deleted and replaced with the
following:
“Section
2.01(a). Revolving Credit.
The Bank
agrees, on the terms and conditions hereinafter set forth, to make the Revolving
Credit Loans to the Borrower from time to time during the period from the date
of this Agreement up to but not including the Termination Date in an aggregate
principal amount not to exceed at any time outstanding the Commitment provided,
that the aggregate outstanding principal amount of advances at any time
outstanding shall not exceed the amount of the Commitment. Within the limits
of
the Commitment, the Borrower may borrow, repay and reborrow under this
Section
2.01(a).
On such
terms and conditions, the Revolving Credit Loans may be outstanding as Prime
Loans or LIBOR Loans. Each type of Revolving Credit Loan shall be made and
maintained at the Bank’s Lending Office for such type of Loan.
Section
2.01(b). Term Loan.
Subject
to the terms and conditions of this Agreement, the Bank agrees to loan Borrower
$10,000,000, to be further evidenced by the Term Note. The purpose of the
advance under the Term Note is to enable Borrower to reduce a portion of the
Borrower’s/Guarantor’s existing revolving credit facilities, and one hundred
percent (100%) of the proceeds of the Term Loan shall be used to reduce said
facilities.”
1.8. Section
2.03 (Interest) is amended to reflect that a new subsection (3) is hereby added
at the end of said section, as follows:
“(3) For
the
Term Loan, as set forth in the Term Note.”
1.9. Section
2.06 (Note) is hereby deleted and replaced with the following:
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“Section
2.06. Note.
The
Revolving Credit Loan made by the Bank under this Agreement shall be evidenced
by, and repaid with interest in accordance with, the Revolving Credit Note,
in
form and content as set forth on Exhibit
“D”
hereto,
duly completed, and payable to the Bank for the account of its applicable
Lending Office, such Revolving Credit Note to represent the obligation of the
Borrower to repay the Revolving Credit Loan. The Bank is hereby authorized
by
the Borrower to endorse on the schedule attached to the Revolving Credit Note
held by it the amount and type of each Revolving Credit Loan and each renewal,
conversion, and payment of principal amount received by the Bank for the account
of its applicable Lending Office on account of its Revolving Credit Loans,
which
endorsement shall, in the absence of manifest error, be conclusive as to the
outstanding balance of the Revolving Credit Loans made by the Bank; provided,
however, that the failure to make such notation with respect to any Revolving
Credit Loan or renewal, conversion, or payment shall not limit or otherwise
affect the obligations of the Borrower under this Agreement or the Revolving
Credit Note held by the Bank.
The
aggregate principal balance and all accrued interest of all Revolving Credit
Loans shall be repaid on the Termination Date.
The
Term
Loan made by the Bank under this Agreement shall be evidenced by and repaid
with
interest in accordance with the Term Note, in form and content as set forth
on
Exhibit
“N”
hereto,
duly completed and payable to the Bank for the account of its applicable Lending
Office, such Term Note to represent the obligation of the Borrower to repay
the
Term Loan.”
1.10. Section
2.08 (Use of Proceeds) is hereby deleted and replaced with the
following:
“Section
2.8. Use of Proceeds.
The
proceeds of the Revolving Credit Loan hereunder shall be used by the Borrower
to
finance working capital requirements and repay certain existing indebtedness.
The Borrower will not, directly or indirectly, use any part of such proceeds
for
the purpose of purchasing or carrying any margin stock within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System or to
extend credit to any Persons for the purpose of purchasing or carrying any
such
margin stock, or for any purpose which violates, or is inconsistent with,
Regulation X of such Board of Governors.
The
proceeds of the Term Loan hereunder shall be used as set forth in Section
2.01(b) hereof.”
1.11. Section
2.14 (Termination Fee) is hereby deleted and replaced with the
following:
“Section
2.14. Termination Fee. The
Borrower may terminate Bank’s Revolving Credit Commitment under this Agreement
at any time upon not less than ten (10) Business Day’s notice to Bank of such
intention, provided, that all monetary obligations (e.g. payment of Note) and
any indemnification shall continue; and provided further that Borrower agrees
to
pay to the Bank a termination fee in an aggregate amount equal to $10,000 in
the
event the Revolving Credit Commitment is terminated for any reason prior to
nine
(9) months from the execution date hereof; provided, that no termination fee
shall be payable for any prepayment if the Borrower is required to make any
payments under Sections
2.11 and/or 2.12.”
1.12. Section
7.03 (Minimum Tangible Net Worth) is hereby deleted and replaced with the
following:
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“Section
7.03. Minimum
Tangible Net Worth.
Borrower
shall maintain at all times a minimum Adjusted Tangible Net Worth as of the
last
day of each fiscal quarter equal to or greater than the sum of (i) the greater
of (A) eighty-five percent (85%) of the Adjusted Tangible Net Worth as of July
31, 2005 and (B) $5,000,000, plus
(ii)
seventy-five percent (75%) of positive quarterly Net Income and (iii) one
hundred percent (100%) of any subsequent equity issuances less
Distributions permitted under Section 6.06 hereof.”
2. Conditions
Precedent.
The
obligations of the Bank to perform under the ACM Credit Agreement, as amended
hereby, are subject to the satisfaction of the following.
2.1. Borrower
shall execute and deliver this Amendment, and all schedules hereto.
2.2. Borrower
shall execute and deliver the Term Note, in form and content as set forth on
Schedule
“2.2”
hereto.
2.3. Borrower
shall execute and deliver the Mortgages, in form and content as set forth on
Schedule
“2.3”
hereto.
2.4. Borrower
shall deliver title searches on each of the Mortgaged Properties, in a form
acceptable to Bank, which searches must evidence no conflicting security
interests on any of the Mortgaged Properties.
2.5. Borrower
shall pay to Bank a closing fee in the amount of $2,500.00.
2.6. Borrower
shall execute and deliver any other instruments, documents and/or agreements
reasonably required by Bank in connection herewith.
2.7. No
Default or Event of Default exists or will result from the execution and
delivery of this Amendment.
3. Recording
of Mortgages.
Each of
the Mortgages shall be recorded in the land records of the appropriate county
and state within ninety (90) days of the date of this Amendment. Failure to
comply with this Section 3, other than a failure resulting from an act or
failure to act by Bank or its representative, shall be a Default under the
ACM
Credit Agreement.
4. Substitution
of Mortgaged Property.
Bank
agrees that Borrowers shall have the option to substitute portions of the
Mortgaged Property in the event a property is closed or relocated, provided
that
the property to be added as collateral shall have a value equal to or greater
than the property being released. In the event Borrower requests the release
of
one of the Mortgaged Properties but has no available substitute property, a
release of such Mortgaged Property will be granted provided the value (defined
at original purchase price) of the remaining properties equals not less than
ninety percent (90%) of the outstanding principal balance on the Term
Loan.
5. Representations
and Warranties.
Each of
the Borrower and the Guarantors, respectively, hereby ratify and confirm all
representations and warranties set forth in Article IV of the ACM Credit
Agreement, Section 8 of the Security Agreement, and Sections 24 through 29
of
the Guaranty Agreement other than any representation or warranty that relates
to
a specific prior date and except to the extent that the Bank has been notified
in writing by the Borrower that any representation or warranty is not correct
and the Bank has explicitly waived in writing compliance with such
representation or warranty.
6. Ratification.
Borrower hereby ratifies and confirms the ACM Credit Agreement, and all
instruments, documents, and agreements executed by and in connection
therewith.
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7. Ratification
and Amendment of Security Agreements.
Each
Borrower and Colonial hereby (i) ratifies and confirms its respective Security
Agreement, and (ii) acknowledges and agrees that its said Security Agreement
is
hereby amended to evidence that the “Obligations” secured thereby shall include
the $10,000,000 Revolving Credit Note and the $10,000,000 Term
Note.
8. Ratification
and Amendment of Guaranties.
ACM-Texas and Colonial each hereby (i) ratifies and confirms its respective
Guaranty, (ii) acknowledges and agrees that its said Guaranty is hereby amended
to evidence that the aggregate amount of the Loan and Note, as defined therein,
shall now be $20,000,000, and that such amount shall include the $10,000,000
Term Loan and $10,000,000 Term Note, and (iii) acknowledges and agrees that
its
respective Guaranty fully guarantees the $10,000,000 Term Note, and the
$10,000,000 Revolving Credit Note.
9. Ratification
and Amendment of Subordination Agreements.
ACM-Texas and Colonial each hereby (i) ratifies and confirms its respective
Subordination Agreement, (ii) acknowledges and agrees that its respective
Subordination Agreement is hereby amended to evidence that the aggregate amount
of the Loan and Note, as defined therein, shall now be $20,000,000, (iii)
acknowledges and agrees that the Superior Obligations and Superior Liens, as
defined in its respective Subordination Agreement, shall now include the
$10,000,000 Term Note and the $10,000,000 Revolving Credit Note, and (iv)
acknowledges and agrees that its respective Subordinate Obligations and
Subordinate Liens are subordinate to the $10,000,000 Term Note and $10,000,000
Revolving Credit Note.
10.
Paying
Agent.
Bank
and Borrower hereby acknowledge and agree that Bank of Arkansas, N.A., shall
be
designated as paying agent for Bank. All payments which are to be made to Bank
under the terms of the ACM Credit Agreement and other Loan Documents shall
be
made to Bank of Arkansas, N.A. as paying agent.
11.
Governing
Law.
This
Agreement and the Note shall be governed by, and construed in accordance with,
the laws of the State of Arkansas.
12.
Multiple
Counterparts.
This
Amendment may be executed in any number of counterparts, and by different
parties to this Amendment in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall
constitute one and the same agreement.
13.
Costs,
Expenses and Fees.
Borrower agrees to pay all costs; expenses and fees incurred by Banks in
connection herewith, including without limitation the reasonable attorney fees
of Riggs, Abney, Neal, Turpen, Orbison and Xxxxx.
|
“BORROWER”
AMERICA’S
CAR MART, INC.,
an Arkansas corporation
By
/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, Vice President
|
5
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TEXAS
CAR-MART, INC.,
a
Texas corporation
By
/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, Vice President
"GUARANTOR"
and “SUBORDINATING PARTY”
AMERICA’S
CAR-MART, INC.,
a
Texas corporation, formerly known as Crown Group, Inc.
By
Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, Vice President
COLONIAL
AUTO FINANCE, INC.,
an
Arkansas corporation
By
/s/ X. X. Xxxxxxx, III
Xxxxxx X. Xxxxxxx, III, President
“BANK”
BANK
OF OKLAHOMA, N.A.
By
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx, Vice President
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6
Schedule
“1.6”
[Exhibit
“M” to the ACM Credit Agreement]
(Mortgaged
Property)
7
Schedule
“2.2”
[Exhibit
“N” to the ACM Credit Agreement]
(Term
Note)
8
Schedule
“2.3”
[Exhibit
“L” to the ACM Credit Agreement]
(Mortgages)
9
