EXHIBIT 10.1
FIRST AMENDMENT TO CREDIT AGREEMENT
Dated as of April 9, 1998
Lithia Motors, Inc. ("Borrower"), its Affiliates and Subsidiaries who are
from time to time parties thereto, including without limitation those signing
this Agreement (together with Borrower, the "Loan Parties"); the financial
institutions who are from time to time parties thereto ("Lenders"), including
without limitation those signing this Amendment ("Amendment"), and U.S. Bank
National Association, as agent for the Lenders, have entered into a Credit
Agreement dated as of December 22, 1997 ("Credit Agreement").
The parties have agreed to amend the Credit Agreement as set forth herein.
In consideration of the premises and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. INCREASE IN SWINGLINE COMMITMENT. The parties have agreed to
increase the Swingline Commitment from $10,000,000 to $30,000,000 without any
corresponding increase in the Total New Vehicle Commitment. Accordingly, to the
extent that the sum of the Swingline Loan Outstandings plus the Total New
Vehicle Loan Outstandings exceeds the Total New Vehicle Commitment, such amount
shall be maintained by Swingline Lender solely for its own account.
2. AMENDMENTS TO CREDIT AGREEMENT. The Credit Agreement is hereby amended
Commitment as follows:
2.1 DEFINITIONS. The definitions of Required Lenders, Swingline and
Total Commitment are deleted and replaced with the following:
REQUIRED LENDERS. As of any date the holders of sixty-six
and twothirds percent (66 2/3%) of the Total Commitment or, if the
Commitments have been terminated, the holders of sixty-six and
two-thirds percent (66 2/3%) of the principal amount of the Total Loan
Outstandings on such date (allocating up to $10,000,000 of Swingline
Loan Outstandings to the Lenders on the basis of their respective PRO
RATA Share of the Total New Vehicle Loan Outstandings and allocating
any Swingline Loan Outstandings over $10,000,000 to the Swingline
Lender).
SWINGLINE COMMITMENT. The commitment of the Swingline
Lender, as in effect from time to time, to advance Swingline Loans,
which as of the Closing Date shall be $5,000,000 and as of April 9,
1998 shall be $30,000,000 and which may be any lesser amount,
including zero, resulting from a termination or reduction of such
amount in accordance with Sections 2.1 and 8.2 of this Agreement.
TOTAL COMMITMENT. At any time, the sum of the Total New Vehicle
Commitment (which includes $10,000,000 of the Swingline Commitment)
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$20,000,000 of the Swingline Commitment, Total Program and Used Vehicle
Commitment, Total Demonstrator Vehicle Commitment, and Total Acquisition
Loan Commitment.
2.2 NEW VEHICLE LOANS. Section 2.1 (a)(i)(A) is deleted and replaced
with the following:
(A) After giving effect to all requested New Vehicle Loans, the
Total New Vehicle Loan Outstandings (which equals the sum of (x) the
outstanding principal amount of New Vehicle Loans specifically advanced to
finance the purchase of New Vehicles for inventory, plus (y) the
outstanding principal amount of Other Purpose Loans) plus the Swingline
Loan Outstandings, shall not at any time exceed the sum of the Total New
Vehicle Commitment plus $20,000,000 (representing a portion of the
Swingline Commitment).
2.3 SWINGLINE LOANS. Section 2.1 (b)(i)(B) is deleted and replaced
with the following:
(B) The sum of the Total Swingline Loan Outstandings plus the
Total New Vehicle Loan Outstandings (after giving effect to all requested
New Vehicle Loans and Swingline Loans) shall not exceed the sum of the
Total New Vehicle Commitment plus $20,000,000 (representing a portion
of the Swingline Commitment).
2.4 FUNDING OF LOANS. THE following is hereby added to the Credit
Agreement as Section 2.4(b)(iv):
Notwithstanding anything to the contrary in this Agreement, including
but not limited to the fact that the sum of the Total Swingline Loan
Outstandings plus the Total New Vehicle Loan Outstandings may exceed the
Total New Vehicle Commitment, no Lender shall have any obligation
whatsoever, whether directly or indirectly, to fund New Vehicle Loans in
excess of such Lender's New Vehicle Commitment or to fund any other Loans
in excess of the applicable Commitment of such Lender.
2.5 PREPAYMENTS. The first sentence of Section 2.7(b) is deleted and
replaced with the following:
If at any time and for any reason (i) the aggregate of the Total New
Vehicle Loan Outstandings plus the Swingline Loan Outstandings shall exceed
the sum of the Total New Vehicle Commitment plus $20,000,000, or (ii) the
aggregate of the Total New Vehicle Loan Outstandings plus up to $10,000,000
of the Swingline Loan Outstandings shall exceed the Total New Vehicle
Commitment, the Borrower shall immediately pay the amount of such excess to
the Agent for application in accordance with the terms of Section 2.8(d) of
this Agreement.
2.6 AMENDMENTS; WAIVERS, ETC. The second proviso to Section 11.7 is
deleted and replaced with the following:
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PROVIDED, FURTHER, that the Swingline Lender may increase the Fee
associated with the Swingline Commitment without the consent of any other
Lender, and U.S. Bank may increase the Fee associated with the Total
Demonstrator Vehicle Commitment without the consent of any other Lender.
2.7 SCHEDULE 1-B. Schedule 1-B is replaced with the Schedule 1-B
attached hereto.
3. NO OTHER CHANGES. Except as amended previously or herein, all terms
and conditions of the Credit Agreement and each Loan Document shall remain in
full force and effect. Each Loan Party acknowledges and agrees that (a) each
Loan Document is and shall remain valid and enforceable in accordance with its
terms and (b) each Loan Party has no defenses, setoffs, counterclaims or claims
for recoupment against the indebtedness and obligations imposed by the Loan
Documents.
4. DEFINED TERMS. All capitalized terms used herein without definition
shall have the meanings given to such terms in the Credit Agreement.
5. CONDITIONS PRECEDENT. THE effectiveness of this Agreement is subject
to satisfaction of the following conditions:
5.1 Each party whose name appears on the signature pages hereto shall
execute and deliver this Amendment to Agent.
5.2 Borrower shall execute and deliver to Swingline Lender a new
Swingline Note in the amount of $30,000,000.
5.3 Borrower shall pay a $75,000 fee to Agent. $25,000 shall be
retained by Agent. $50,000 shall be distributed by the Agent to the Lenders.
Each Lender shall receive the amount set forth by such Lender's signature.
5.4 Each Loan Party shall execute such documents, provide such
information and satisfy such other requirements as Lender reasonably requires.
6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one document.
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7. DISCLOSURE.
UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY
LENDERS AFTER OCTOBER 3, 1989, 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.
BORROWER:
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