EXHIBIT 4(f)(38)
FIRST AMENDMENT
TO
AMENDED AND RESTATED CREDIT AGREEMENT
This FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT ("First
Amendment") is made as of this 8th day of March, 2002 by and among Credit
Acceptance Corporation, a Michigan corporation ("Company"), the Permitted
Borrowers signatory hereto (each, a "Permitted Borrower" and collectively, the
"Permitted Borrowers"), Comerica Bank and the other banks signatory hereto
(individually, a "Bank" and collectively, the "Banks") and Comerica Bank, as
agent for the Banks (in such capacity, "Agent").
RECITALS
A. Company, Permitted Borrowers, Agent and the Banks entered into that
certain Amended and Restated Credit Acceptance Corporation Credit Agreement
dated as of June 11, 2001 (the "Credit Agreement") under which the Banks renewed
and extended (or committed to extend) credit to the Company and the Permitted
Borrowers, as set forth therein.
B. The Company and the Permitted Borrowers have requested that Agent
and the Banks agree to certain amendments to the Credit Agreement and Agent and
the Banks are willing to do so, but only on the terms and conditions set forth
in this First Amendment.
NOW, THEREFORE, Company, Permitted Borrowers, Agent and the Banks
agree:
1. (a) Section 1 of the Credit Agreement is hereby amended by amending and
restating, or adding (as applicable), the following definitions:
"Permitted Securitization(s)" shall mean each transfer or encumbrance
(each a "disposition") of specific Advances to Dealers or Leased
Vehicles funded under Back-End Dealer Agreements (and any interest in
or lien on the Installment Contracts, Leases, motor vehicles or other
rights relating thereto) or of specific Installment Contracts or Leases
(and any interest in or lien on motor vehicles or other rights relating
thereto) arising under Outright Dealer Agreements or (subject to the
terms hereof) of Pools of such financial assets and each transfer or
encumbrance (also, a "disposition") of a Specified Interest (and the
reallocation of Leased Vehicles, Leases and related financial assets
from the Non-Specified Interest to such Specified Interest in
connection therewith), in each case by the Company or one or more of
its Subsidiaries to a Special Purpose Subsidiary conducted in
accordance with the following requirements:
(a) Each disposition shall identify with reasonable certainty the
specific Advances to Dealers, Leased Vehicles, Installment
Contracts or Leases covered by such disposition; and (x) such
Advances to Dealers or Leased Vehicles, and the
Installment Contracts, Leases, motor vehicles or other rights
relating thereto shall have performance and other
characteristics so that the quality of such Advances to
Dealers, Leases Vehicles, Installment Contracts or Leases, as
the case may be, is comparable to, but not materially better
than, the overall quality of the Company's Advances to
Dealers, Leased Vehicles, Installment Contracts or Leases, as
applicable, as determined in good faith by the Company in its
reasonable discretion or (y) with respect to any such assets
assigned to an uncapped Pool subsequent to such Pool becoming
a Securitized Pool in conformity with the standards set forth
in clause (x) of this subparagraph (a), the assets covered by
such dispositions were assigned to such Pool in the order such
assets were originated and without the exercise of any
discretion by the Company;
(b) Both before and after giving effect to such disposition (and
taking into account any reduction in the Indebtedness with the
proceeds of such disposition as required hereunder), the
Company shall be in compliance with the Borrowing Base
Limitation;
(c) Each such Securitization Transaction shall be structured on
the basis of the issuance of Debt or other similar securities
by the Special Purpose Subsidiary which shall be without
recourse, except to the extent of normal and customary
representations and warranties given as of the date of each
such disposition, and not as continuing representations and
warranties, and otherwise on normal and customary terms and
conditions for comparable asset-based securitization
transactions, which may include Cleanup Call provisions (it
being understood that, for purposes of this subparagraph (c),
the terms and conditions governing Securitization Transactions
made by the Company prior to January 1, 2002 shall be deemed
to have been made on normal and customary terms and
conditions);
(d) Concurrently with each such disposition (except for
dispositions to an uncapped Securitized Pool pursuant to a
revolving, expansion or relending feature included in a Prior
Securitization (for purposes of this definition, a "Revolving
Feature") after the expiration in the ordinary course, and not
as a result of any failure of a covenant or condition, early
termination, default or similar event, of the period during
which additional loans or advances are available under such
Revolving Feature (for purposes of this definition, a
"Post-Revolving Period Disposition"), to the extent that no
disposition proceeds are available as a result of such
dispositions for application hereunder), the net proceeds of
such disposition:
shall be applied to reduce the principal balance
outstanding under the Revolving Credit (to the extent
then outstanding, and including the aggregate amount
of drawings made under any Letter of Credit for which
the Agent has not received full payment) by the
amount of such net proceeds, subject to the right to
reborrow in accordance with this Agreement;
provided, however, that to the extent that, on the
date any reduction of the
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principal balance outstanding under the Revolving
Credit shall be required under this clause (d), the
Indebtedness under the Revolving Credit is being
carried, in whole or in part, at the Euro
Currency-based Rate and no Default or Event of
Default has occurred and is continuing, the Company
may, after prepaying that portion of the Indebtedness
then carried at the Prime-based Rate, deposit the
amount of such required principal reductions in a
cash collateral account to be held by the Agent, for
and on behalf of the Banks (which shall be an
interest-bearing account), on such terms and
conditions as are reasonably acceptable to Agent and
the Majority Banks and, subject to the terms and
conditions of such cash collateral account, sums on
deposit therein shall be applied (until exhausted) to
reduce the principal balance of the revolving credit
on the last day of each Interest Period attributable
to the applicable Eurocurrency-based Advances of the
Revolving Credit; and
(e) Both immediately before and after such disposition, no Default
or Event of Default (whether or not related to such
disposition) has occurred and is continuing.
In connection with each Permitted Securitization to be conducted
hereunder, the Company shall provide the following:
(i) to the Agent, (x) not less than three (3) Business Days prior
to the date of consummation thereof (or such lesser period as
approved by Agent) or (y) solely in the case of dispositions
to uncapped Securitized Pools pursuant to a Revolving Feature,
not less than three (3) Business Days prior to the date of the
release of the financial assets covered by such disposition
(or such lesser period as approved by Agent), (I) a
certification that, after giving effect to such disposition,
it will be in compliance with the Borrowing Base Limitation
and that none of the assets covered by such disposition were
included in the most recent quarterly Borrowing Base
Certificate delivered to Agent under Section 7.3(d) hereof
prior to such disposition or (II) a new Borrowing Base
Certificate (and any supporting information reasonably
required by the Agent) dated as of the proposed date of the
applicable disposition or release and, based on projected
information, giving effect to such disposition and confirming
compliance with the Borrowing Base Limitation;
(ii) to the Agent and the Banks (x) not less than five (5) Business
Days prior to the date of consummation thereof (or such lesser
period as approved by Agent), proposed drafts of the material
Securitization Documents covering the applicable
Securitization Transaction (and the term sheet or commitment
relating thereto) and (y) within ten (10) Business Days
following the consummation thereof, executed copies of such
Securitization Documents, including, if applicable, a summary
of any material changes from the draft documents delivered to
Agent and the Banks prior thereto, except that if such
Securitization Transaction consists solely of dispositions
pursuant to a Revolving Feature, the Company shall only be
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required (I) under clause (x) of this subparagraph (ii), to
deliver to Agent, not less than three (3) Business Days prior
to the consummation thereof (or such lesser period as approved
by Agent), a certification that the applicable Securitization
Documents remain in effect substantially in the form
previously furnished to Agent and the Banks (or identifying
any material changes, and attaching any proposed amendment,
supplement or other document delivered under such prior
Securitization Documents to effect such dispositions) and (II)
under clause (y) of this subparagraph (ii), to deliver to
Agent executed copies of any such amendment, supplement or
other document; and
(iii) to the Agent, (x) not less than three (3) Business Days prior
to the date of consummation thereof (or such lesser period as
approved by Agent) or (y) solely in the case of dispositions
to uncapped Securitized Pools pursuant to a Revolving Feature,
not less than three (3) Business Days prior to the date of the
requested release of the financial assets covered by such
dispositions (or such lesser period as approved by Agent), (I)
a schedule in the form attached hereto as Exhibit [Q]
identifying the specific Advances to Dealers or Leased
Vehicles and the related Installment Contracts or Leases
proposed to be covered by such transaction, accompanied by
(II) a request that the Agent release such assets from the
Lien of the Security Agreement and a certification that the
proposed Securitization Transaction (and related dispositions)
constitutes a Permitted Securitization hereunder, whereupon
the financial assets covered by such dispositions which have
been originated prior to the date of such release shall be
promptly released by Agent, provided that in the case of a
Post-Revolving Period Disposition, all remaining financial
assets assigned thereafter to the applicable uncapped
Securitized Pool in the ordinary course, whether originated
before or after the date of release, shall be so released and
the Lien of the Security Agreement shall not attach to any
such assets when the Company or any of its Subsidiaries
subsequently acquires rights in, to or under such assets; and
(iv) only if the applicable Securitization Transaction is not
related to a Prior Securitization or involves the disposition
or release of any assets which were covered by the most recent
quarterly Borrowing Base Certificate delivered to Agent under
Section 7.3(d) hereof and the aggregate net book value of the
Advances to Dealers or Leased Vehicles covered by such
dispositions (or related series of dispositions) in any
calendar month exceeds or would exceed (after giving effect to
any proposed disposition) Seven Million Five Hundred Thousand
Dollars ($7,500,000), collection information regarding the
related Installment Contracts or Leases proposed to be covered
by such transaction (with evidence supporting its
determination under clause (x) of subparagraph (a) of this
definition, if applicable, including without limitation a
"static pool analysis" comparable to the static pool analysis
required to be delivered under Section 7.3(c) hereof with
respect to such Installment Contracts or Leases).
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"Pools" shall mean a grouping on the books and records of the Company
or any of its Subsidiaries of Advances to Dealers, Leased Vehicles,
Installment Contracts or Leases originated or to be originated with the
Company or any of its Subsidiaries by a Dealer and bearing the same
pool identification number assigned by the Company's computer system,
with (x) an "uncapped" Pool being a Pool which is not reflected on such
books and records as capped and to which additional Advances to
Dealers, Leases and related financial assets may be added and (y) a
Pool being capped when the number of the applicable financial assets in
such Pool has reached the limit established from time to time by
written agreement between the relevant Dealer and the Company or
Subsidiary, as applicable, in the ordinary course of business, such
that no further financial assets may be added to such Pool.
"Prior Securitization" shall mean a Permitted Securitization (and the
related Securitization Documents) consummated under the Credit
Agreement prior to the particular disposition, release or other
transaction then being considered.
"Revolving Credit Maximum Amount" shall mean One Hundred Thirty Five
Million Dollars ($135,000,000), subject to any increases in the
Revolving Credit Maximum Amount pursuant to Section 2.18 of this
Agreement, by an amount not to exceed the Revolving Credit Optional
Increase, and subject to any reductions or termination of the Revolving
Credit Maximum Amount under Sections 2.15 or 9.2 of this Agreement.
"Revolving Credit Optional Increase" shall mean an amount up to Forty
Million Dollars ($40,000,000), minus the portions thereof applied from
time to time under Section 2.18 hereof to increase the Revolving Credit
Maximum Amount.
"Securitized Pool(s)" shall mean a Pool, whether capped or uncapped,
which has been transferred to a Permitted Securitization, including a
Prior Securitization.
(b) Section 1 of the Credit Agreement is further amended by amending
the following definitions in the manner set forth below:
"Advances to Dealers" is amended by adding to the sixth line thereof
(following the words "provided that"), the words ", for purposes of the
definition of Collateral determining the Borrowing Base and compliance
with the covenants under Section 7.4 through 7.7 and 7.17 hereof," and
by adding to the end of the seventh line thereof (after the words
"Permitted Securitization"), the words "or assigned to a Securitized
Pool".
"Leased Vehicle" is amended by adding to the seventh line thereof
(following the words "provided that"), the words "for purposes of the
definition of Collateral determining the Borrowing Base and compliance
with the covenants under Section 7.4 through 7.7 and 7.17 hereof," and
by adding to the tenth line thereof (following the words "Permitted
Securitization") the words "or assigned to a Securitized Pool".
2. Section 8 of the Credit Agreement is amended as follows:
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(a) Section 8.5(h) is amended and restated in its entirety, as follows:
(h) non-recourse Debt incurred by a Special Purpose Subsidiary
and secured by assets transferred pursuant to a Permitted
Securitization, whether or not attributable to the Company under GAAP;
(b) Section 8.16 is amended and restated in its entirety, as follows:
8.16 Securitization Transaction; Amendments to Securitization
Documents. Engage in a Securitization Transaction, other than a
Permitted Securitization and, except in connection with a Permitted
Securitization, assign and transfer any financial assets to a
Securitized Pool or allocate or reallocate Leases, Leased Vehicles or
other financial assets to a Specified Interest, and once executed and
delivered pursuant to a Permitted Securitization, amend, modify or
otherwise alter any of the material terms and conditions of any
Securitization Documents or waive (or permit to be waived) any such
provision thereof in any material respect, adverse to the Company or
any Subsidiary, without the prior written approval of Agent and the
Majority Banks. For purposes of the Securitization Documents, the
"material terms and conditions" thereof shall be deemed solely those
terms or conditions with respect to servicer fees, servicer expenses,
defaults, events of default, recourse to the Company or any Subsidiary
(other than a Special Purpose Subsidiary), Cleanup Calls or conditions
contained therein which are required under or necessary for compliance
with this Agreement.
3. Replacement Exhibit Q (Form of Schedule of Financial Assets for
Release) to the Credit Agreement set forth on Attachment 1 hereto shall
replace, in its entirety, existing Exhibit Q to the Credit Agreement.
4. This First Amendment shall become effective, according to the terms and
as of the date hereof, upon satisfaction by the Company and the
Permitted Borrowers of the following conditions:
(a) Agent shall have received counterpart originals of this First
Amendment, in each case duly executed and delivered by
Company, the Permitted Borrowers and the requisite Banks, in
form satisfactory to Agent and the Banks; and
(b) Agent shall have received from the Company and each of the
Permitted Borrowers a certification (i) that all necessary
actions have been taken by such parties to authorize execution
and delivery of this First Amendment, supported by such
resolutions or other evidence of corporate authority or action
as reasonably required by Agent and the Majority Banks and
that no consents or other authorizations of any third parties
are required in connection therewith; and (ii) that, after
giving effect to this First Amendment, no Default or Event of
Default
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has occurred and is continuing on the proposed effective date
of the First Amendment.
If the foregoing conditions have not been satisfied or waived
on or before March 8, 2002, this First Amendment shall lapse
and be of no further force and effect.
5. Each of the Company and the Permitted Borrowers ratifies and confirms,
as of the date hereof and after giving effect to the amendments
contained herein, each of the representations and warranties set forth
in Sections 6.1 through 6.21, inclusive, of the Credit Agreement and
acknowledges that such representations and warranties are and shall
remain continuing representations and warranties during the entire life
of the Credit Agreement.
6. Except as specifically set forth above, this First Amendment shall not
be deemed to amend or alter in any respect the terms and conditions of
the Credit Agreement, any of the Notes issued thereunder or any of the
other Loan Documents, or to constitute a waiver by the Banks or Agent
of any right or remedy under or a consent to any transaction not
meeting the terms and conditions of the Credit Agreement, any of the
Notes issued thereunder or any of the other Loan Documents.
7. Unless otherwise defined to the contrary herein, all capitalized terms
used in this First Amendment shall have the meaning set forth in the
Credit Agreement.
8. This First Amendment may be executed in counterpart in accordance with
Section 13.10 of the Credit Agreement.
9. Comerica Bank - Canada having been designated by Comerica Bank, in its
capacity as Swing Line Bank (and as a Bank) under the Credit Agreement
to fund Comerica Bank's advances in $C pursuant to Section 11.12 of the
Credit Agreement, has executed this First Amendment to evidence its
approval of the terms and conditions thereof.
10. This First Amendment shall be construed in accordance with and governed
by the laws of the State of Michigan.
[SIGNATURES FOLLOW ON SUCCEEDING PAGES]
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WITNESS the due execution hereof as of the day and year first above
written.
COMERICA BANK, CREDIT ACCEPTANCE
as Agent CORPORATION
By: /S/ Xxxxx Xxxxxxx By: /S/ Xxxxxxx X. Xxxx
---------------------------- --------------------
Its: Assistant Vice President Its: CFO and Treasurer
--------------------------- -----------------
One Detroit Center
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
COMERICA BANK - CANADA CREDIT ACCEPTANCE
CORPORATION UK LIMITED
By: /S/ Xxxxxx Xxxxx By: /S/ Xxxxx X. Xxxxxxx /S/ Xxxxxxx X. Xxxx
---------------------------- ---------------------- -------------------
Its: Vice President Its: CFO & Director Treasurer & Director
-------------------------- -------------- --------------------
CAC OF CANADA LIMITED
By: /S/ Xxxxxxx X. Xxxx
-------------------
Its: CFO and Treasurer
------------------
CREDIT ACCEPTANCE
CORPORATION IRELAND LIMITED
By: /S/ Xxxxx X. Xxxxxxx /S/ Xxxxxxx X. Xxxx
-------------------- -------------------
Its: CFO & Director Treasurer & Director
-------------- --------------------
BANKS:
COMERICA BANK M&I XXXXXXXX & ILSLEY BANK,
formerly known as National City Bank of
Minneapolis
By: /S/ Xxxxx Xxxxxxx By: /S/ Xxxxx Xxxxxxxx
---------------------------- ------------------
Its: Assistant Vice President Its: Vice President
LASALLE BANK NATIONAL BANK OF AMERICA, N.A.
ASSOCIATION
By: /S/ Xxxxxx Xxxxxx By: /S/ Xxxxxx X. Xxxxxx
---------------------------- --------------------
Its: Principal
Its: Assistant Vice President
NATIONAL CITY BANK OF
XXXXXX TRUST AND SAVINGS BANK MICHIGAN/ILLINOIS
By: /S/ Xxxxxxx Xxxxxx By: /S/ Xxxxxxx X. Xxxxxxxx
---------------------------- -----------------------
Its: Vice President Its: Senior Vice President
-------------------------- ---------------------
FIFTH THIRD BANK (EASTERN MICHIGAN)
By: /S/ Xxxx Xxxxxx
-------------------------------------
Its: Vice President
-------------------------------------
