FIFTH AMENDMENT TO AMENDED AND RESTATED AGENTED
Exhibit
4.1
THIS
FIFTH AMENDMENT TO AMENDED AND RESTATED AGENTED REVOLVING CREDIT
AGREEMENT
("Amendment") is dated effective as of December 31, 2006, by and
among
COLONIAL AUTO FINANCE, INC.,
an
Arkansas corporation (“Borrower”), BANK
OF ARKANSAS, N.A.,
GREAT
SOUTHERN BANK,
FIRST
STATE BANK, FIRST STATE BANK OF NORTHWEST ARKANSAS,
SOVEREIGN BANK,
and
ENTERPRISE
BANK & TRUST,
and
COMMERCE
BANK, N.A. (each
individually a “Bank” and collectively the “Banks”), and BANK
OF ARKANSAS, N.A.,
as
agent for the Banks hereunder (in such capacity the “Agent”).
RECITALS
A. Reference
is made to the Amended and Restated Agented Revolving Credit Agreement dated
as
of June 23, 2005, and amended September 30, 2005, October 31, 2005, February
24,
2006, and April 28, 2006 (as amended, the "Colonial Credit Agreement"), by
and
among Borrower, the Banks party thereto, and Agent, pursuant to which a
$40,000,000 Revolving Line of Credit exists in favor of Borrower.
B. Borrower
and Banks have agreed that certain modifications shall be made to the Colonial
Credit Agreement for compliance purposes. Terms used herein shall have the
meanings given in the Colonial Credit Agreement unless otherwise defined
herein.
AGREEMENT
For
valuable consideration received, the parties agree to the
following.
1. Amendments
to Colonial Credit Agreement.
The
Colonial Credit Agreement is amended as follows.
| 1.1. |
The
term “Borrowing Base” is hereby amended to evidence that the amount
“$20,000,000” shall now mean and read “$10,000,000 plus the outstanding
balance of the $9,134,000 Promissory Note payable by America’s Car Mart,
Inc. and Texas Car-Mart, Inc. to Bank of
Oklahoma”.
|
| 1.2 |
The
term "Prime Rate" is amended to read as
follows:
|
|
"Prime
Rate" means a rate which is subject to change from time to time
based on
changes in an index which is the BOKF National Prime Rate, described
as
the rate of interest set by BOK Financial Corporation, in its sole
discretion, on a daily basis as published by BOK Financial Corporation
(“BOKF”) from time to time (the “Index”). The Index is not necessarily the
lowest rate charged by Lender on its loans and is set by Lender
in its
sole discretion. If the Index becomes unavailable during the term
of this
loan, Lender may designate a substitute index after notifying Borrower.
Lender will tell Borrower the current index rate upon Borrower’s request.
The interest rate change will not occur more often than each day.
Borrower
understands that Lender may make loans based on other rates as
well.
NOTICE: Under no circumstances will the interest rate on this Note
be more
than the maximum rate
|
allowed
by applicable law. Whenever increases occur in the interest rate, Lender,
at its
option, may do one or more of the following: (A) increase Borrower’s payments to
ensure Borrower’s loan will pay off by its original final maturity date, (B)
increase Borrower’s payments to cover accruing interest, (C) increase the number
of Borrower’s payments, and (D) continue Borrower’s payments at the same amount
and increase Borrower’s final payment.
1.3.
Section
2.05 is hereby amended to replace the existing pricing grid with the
following:
|
Tier
|
Funded
Debt to EBITDA*
|
Adjusted
Prime Rate
|
Adjusted
LIBOR Rate
|
|
I
|
<1.75
|
Prime
Rate minus
25
bps
|
LIBOR
Rate plus 275 bps
|
|
II
|
>1.75
and <2.00
|
Prime
Rate plus 0.0
|
LIBOR
rate plus
300
bps
|
|
III
|
>2.00
and <2.25
|
Prime
Rate plus
25
bps
|
LIBOR
rate plus
325
bps
|
|
IV
|
>2.25
and <2.50
|
Prime
Rate plus
50
bps
|
LIBOR
rate plus
350
bps
|
|
V
|
>2.50
and <3.50
|
Prime
Rate plus
75
bps
|
LIBOR
rate plus
375
bps
|
|
VI
|
>3.5
|
Prime
Rate plus
100
bps
|
LIBOR
rate plus
400
bps
|
*Combined
Ratio for American Car Mart, Inc., Texas Car-Mart, Inc. and Colonial Auto
Finance,
Inc.
The
Adjusted Rate shall be determined in accordance with the foregoing table
based
on the combined Funded Debt to EBITDA as reflected in the then most recent
Financials. Adjustments, if any, shall be effective five Business Days after
Bank of Arkansas, N.A. has received the applicable Financials. If the Borrower
fails to deliver the Financials at the time required, then the rate shall
be the
highest rate set forth in the foregoing table until five (5) Business Days
after
such Financials are so delivered.
1.4 Section
2.16 (Termination Fee) is hereby amended to the extent that it shall continue
to
be effective through December 31, 2007.
1.5. Article
7
is hereby replaced with the following:
Article
7
FINANCIAL
COVENANTS
The
following financial covenants shall be calculated based upon a combined
financial basis of America's Car Mart, Inc. and Colonial Auto Finance, Inc.
So
long as any Note shall remain unpaid or any Bank shall have any Commitment
under
this Agreement:
2
Section
7.01. Leverage Ratio.
At all
times, calculated as of the last day of each month, maintain a ratio of Funded
Debt to EBITDA for the trailing twelve (12) month period of no greater than
4.00
to 1.00, reducing to 3.50 to 1.00 on November 1, 2007, 3.00 to 1.00 on February
1, 2008, 2.75 to 1.00 on May 1, 2008 and 2.50 to 1.00 on November 1, 2008.
For
purposes of this calculation, the $5,371,000 one-time, non-cash charge will
be
excluded from EBITDA through October 31, 2007.
Section
7.02. Fixed Charge Coverage Ratio.
At all
times, calculated as of the last day of each month, maintain a ratio of (a)
EBITDA to (b) Fixed Charges as of the end of each month for the trailing
six (6)
month period of not less than 1.15 to 1.00, increasing to 1.20 to 1.00 on
May 1,
2007, 1.30 to 1.00 on August 1, 2007, 1.40 to 1.00 on November 1, 2007 and
1.50
to 1.00 on February 1, 2008. For purposes of this calculation, the $5,371,000
one-time, non-cash charge will be excluded from EBITDA through October 31,
2007.
Section
7.03. Minimum Tangible Net Worth. At
all
times, calculated as of the last day of each month, maintain a minimum combined
Adjusted Tangible Net Worth for American Car Mart, Inc, Texas Car-Mart, Inc.
and
Borrower, 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 Minimum Adjusted
Tangible Net Worth as of January 31, 2007 or (B) $108,000,000, plus
(ii)
seventy-five percent (75%) of positive quarterly Net Income and (iii) on
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 Colonial Credit Agreement, as
amended hereby, are subject to the satisfaction of the following.
| 2.1. |
Borrower
shall execute and deliver this
Amendment.
|
| 2.2. |
Borrower
shall deliver an executed Guaranty Agreement along with Secretary
Certificate from America’s Car-Mart, Inc., in form and content as set
forth on Schedule
“2.2”
hereto.
|
| 2.3. |
Borrower
shall execute and deliver any other instruments, documents and/or
agreements reasonably required by Bank in connection
herewith.
|
| 2.4. |
No
Default or Event of Default exists or will result from the execution
and
delivery of this Amendment.
|
| 3. |
Representations
and Warranties.
Borrower hereby ratifies and confirms all representations and warranties
set forth in the Colonial Credit Agreement, and all other Loan Documents,
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.
|
| 4. |
Ratification.
Borrower hereby ratifies and confirms the Colonial Credit Agreement,
and
all instruments, documents, and agreements executed by Borrower in
connection therewith, and confirms that no Default exists
thereunder.
|
3
| 5. |
Ratification
and Amendment of Subordination Agreements.
ACM and ACM-Texas each hereby ratifies and confirms its respective
Subordination Agreement, and confirms that it remains in full force
and
effect.
|
| 6. |
Governing
Law.
This Agreement and the Note shall be governed by, and construed in
accordance with, the laws of the State of
Arkansas.
|
| 7. |
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.
|
| 8. |
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.
|
[Signature
pages follow.]
4
|
“BORROWER”
COLONIAL
AUTO FINANCE, INC.,
an Arkansas corporation
By
/s/ Xxxxxx X. Xxxxxxx
X. X. Xxxxxxx, III, President
“SUBORDINATING
PARTIES”
AMERICA’S
CAR-MART, INC.,
a
Texas
corporation,
formerly known as Crown Group,
Inc.
By
/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, Vice President
AMERICA’S
CAR MART, INC.,
an
Arkansas corporation
By
/s/ Xxxx Xxxxxxxx
Xxxx
Xxxxxxxx, Vice President
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5
| “BANKS” | |
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Revolving
Credit Commitment:
|
BANK
OF ARKANSAS, N.A.
|
|
$10,000,000
|
|
|
Principal
Office and Lending Office:
|
By
/s/ Xxxxxxx X. Xxxx
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P.O.
Box 1407
|
Xxxxxxx X. Xxxx, President & CEO
|
|
Xxxxxxxxxxxx,
XX 00000-0000
|
|
|
Attention:
Xxxxxxx X. Xxxx
|
|
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xxxxx@xxxxxxxxxxxxxx.xxx
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[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
6
|
Revolving
Credit Commitment:
|
SOVEREIGN
BANK
|
|
$3,500,000
|
|
|
Principal
Office and Lending Office:
|
|
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0000
Xxxxx Xxxxxxx 000, Xxxxx 000
|
|
|
Xxxxxx,
Xxxxx 00000
|
By
/s/ Xxxx Xxxxx
|
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Attention:
Xxxx Xxxxx
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Xxxx Xxxxx, Area President
|
|
Email:
xxxxxx@xxxxxxx.xxx
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
7
|
Revolving
Credit Commitment:
|
GREAT
SOUTHERN BANK
|
|
$5,000,000
|
|
|
Principal
Office and Lending Office:
|
|
|
0000
X. Xxxxxxxxxxx
|
|
|
Xxxxxxxxxxx,
XX 00000
|
By
/s/Xxx Xxxxxx
|
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Attn:
Xxx Xxxxxx
|
Xxx Xxxxxx, Vice President
|
|
xxxxxxx@xxxxxxxxxxxxxxxxx.xxx
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
8
|
Revolving
Credit Commitment:
|
FIRST
STATE BANK OF NORTHWEST ARKANSAS
|
|
$1,500,000
|
|
|
Principal
Office and Lending Office:
|
|
|
X.X.
Xxx 0000
|
|
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Xxxxxxxxxxxx,
Xxxxxxxx 00000
|
By
/s/ Xxxxxx Xxxxxxxx
|
|
Attn:
Xxxxxx Xxxxxxxx
|
Xxxxxx
Xxxxxxxx, President/Chief Executive
Officer
|
|
E-mail:
xxxxxxxxx@xxxxxx.xxx
|
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
9
|
Revolving
Credit Commitment:
|
FIRST
STATE BANK
|
|
$6,000,000
|
|
|
Principal
Office and Lending Office:
|
|
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000
Xxxxxxxx Xxxxxx
|
|
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Xxxxxx,
XX 00000
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By________________________________
|
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Attention:
Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx, Senior Vice President
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|
xxxxxx@xxxxxxx.xxx
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[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
10
|
Revolving
Credit Commitment:
|
ENTERPRISE
BANK & TRUST
|
|
$6,000,000
|
|
|
Principal
Office and Lending Office:
|
|
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00000
Xxxxxxx Xxx.
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Xxxxxxxx
Xxxx, XX 00000
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By
/s/ Xxxxx Xxxxxx
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Attention:
Xxxxx X. Xxxxxx
|
Xxxxx X. Xxxxxx, President
|
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e-mail:
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
11
|
Revolving
Credit Commitment:
|
COMMERCE
BANK, N.A.
|
|
$8,000,000
|
|
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Principal
Office and Lending Office:
|
|
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0000
Xxxxxx Xx., XX00-0
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Xxxxxx
Xxxx, XX 00000
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|
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Attention:
Xxxx Area
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By
/s/ Xxxxxx X. Block
|
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E-mail:
xxxx.xxxx@xxxxxxxxxxxx.xxx
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Xxxxxx
X. Block, Senior Vice President
|
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Regional
Banking
|
By
execution of this Amendment, Commerce Bank, N.A. assumes all obligations
as a
Bank under the Colonial Credit Agreement to the extent of pro-rata
share.
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
12
|
“AGENT”
|
|
|
BANK
OF ARKANSAS, N.A.
|
|
|
By
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx, President &
CEO
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective date December 31, 2006]
13
JOINDER
OF BANK OF OKLAHOMA, N.A.
Although
not a party to this Amendment, the undersigned executes this Amendment to
acknowledge its understanding of and agreement to comply with the terms and
conditions of Section 2 hereof related to Allocation of Proceeds of
Collateral.
|
BANK
OF OKLAHOMA, N.A.
By
/s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx, Vice President
|
[Signature
Page to Fifth Amendment to Amended and Restated Agented Revolving
Colonial
Credit Agreement effective dated December 31, 2006]
14
Schedule
"2.2"
(Guaranty
Agreement and Secretary Certificate)
