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$1,000,000,000
FOURTH AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
DATED
OCTOBER 15, 1999, AND
EFFECTIVE AS OF
NOVEMBER 1, 1999
AMONG
GROUP 1 AUTOMOTIVE, INC.,
ITS SUBSIDIARY BORROWERS LISTED HEREIN,
THE LENDERS LISTED HEREIN,
CHASE BANK OF TEXAS, N.A.,
AS ADMINISTRATIVE AGENT,
COMERICA BANK,
AS FLOOR PLAN AGENT,
BANK OF AMERICA, N.A.,
AS DOCUMENTATION AGENT,
AND
U. S. BANK NATIONAL ASSOCIATION, BANK ONE TEXAS, N.A., AND
BANKBOSTON, N.A.,
AS CO-AGENTS
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TABLE OF CONTENTS
Page
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ARTICLE I CERTAIN DEFINED TERMS, ACCOUNTING TERMS AND CONSTRUCTION 7
SECTION I.1 Certain Defined Terms 7
SECTION I.2 Accounting Terms 29
SECTION I.3 Interpretation 29
ARTICLE II THE FLOOR PLAN LOANS 31
SECTION II.1 Floor Plan Loan Commitments 31
SECTION II.2 Floor Plan Loans 31
SECTION II.3 Floor Plan Borrowing Procedure 32
SECTION II.4 Notice of Types of Floor Plan Loans and Interest Periods. 36
SECTION II.5 Payments 37
SECTION II.6 Title Documents 38
SECTION II.7 Power of Attorney 38
SECTION 2.8 Issuance of Drafting Agreements 39
SECTION 2.9 Conditions to Issuance 39
SECTION 2.10 Notice of Issuance of or Entering into Manufacturers Drafting Letters 40
SECTION 2.11 Drafts Under Manufacturers Drafting Letters 40
SECTION 2.12 Obligations Absolute 41
ARTICLE III ACQUISITION LOANS 42
SECTION III.1 General. 42
SECTION III.2 Acquisition Loans 43
SECTION III.3 Notice of Acquisition Loan Borrowings. 44
SECTION III.4 Reserve Commitment; Suspension of Acquisition Loans 44
ARTICLE IV SWING LINE LOANS 45
SECTION IV.1 Swing Line Commitments 45
SECTION IV.2 Accrual of Interest; Margin Adjustments 45
SECTION IV.3 Requests for Swing Line Loans 45
SECTION IV.4 Disbursement of Swing Line Loans 46
SECTION IV.5 Refunding of or Participation Interest in Swing Line Loans 47
SECTION IV.6 Swing Line Overdraft Loans 48
ARTICLE V ALL LOANS 49
SECTION V.1 Notes: Repayment of Loans 49
SECTION V.2 Interest on Loans 49
SECTION V.3 Interest on Overdue Amounts 50
SECTION V.4 Fees 50
SECTION V.5 Termination, Reduction or Conversion of Commitments 51
SECTION V.6 Alternate Rate of Interest 52
SECTION V.7 Prepayment of Loans; Mandatory Reduction of Indebtedness 53
SECTION V.8 Reserve Requirements; Change in Circumstances 54
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SECTION V.9 Change in Legality 55
SECTION V.10 Indemnity 56
SECTION V.11 Pro Rata Treatment 57
SECTION V.12 Payments 57
SECTION V.13 Sharing of Setoffs 58
SECTION V.14 Payments Free of Taxes 58
SECTION V.15 Conversion and Continuation of Acquisition Loan Borrowings and Floor Plan
Borrowings 61
SECTION 5.16 Extension of Maturity Date 64
ARTICLE VI LETTERS OF CREDIT 64
SECTION VI.1 General 64
SECTION VI.2 Issuance, Amendment and Renewal of Letters of Credit 65
SECTION VI.3 Risk Participations, Drawings and Reimbursements 67
SECTION VI.4 Repayment of Participation 68
SECTION VI.5 Role of the Issuing Bank 69
SECTION VI.6 Obligations Absolute 69
SECTION VI.7 Letter of Credit Fees 70
SECTION VI.8 Cash Collateralization 71
ARTICLE VII REPRESENTATIONS AND WARRANTIES 72
SECTION VII.1 Organization; Corporate Powers 72
SECTION VII.2 Authorization 72
SECTION VII.3 Governmental Approval 72
SECTION VII.4 Enforceability 72
SECTION VII.5 Financial Statements 73
SECTION VII.6 No Material Adverse Change 73
SECTION VII.7 Title to Properties; Security Documents 73
SECTION VII.8 Litigation; Compliance with Laws; Etc 73
SECTION VII.9 Agreements; No Default 74
SECTION VII.10 Federal Reserve Regulations 74
SECTION VII.11 Taxes 75
SECTION VII.12 Pension and Welfare Plans 75
SECTION VII.13 No Material Misstatements 75
SECTION VII.14 Investment Company Act; Public Utility Holding Company Act 75
SECTION VII.15 Maintenance of Insurance 75
SECTION VII.16 Existing Liens 75
SECTION VII.17 Environmental Matters 76
SECTION VII.18 Subsidiaries. 76
SECTION VII.19 Engaged in Motor Vehicle Sales 77
SECTION VII.20 Dealer Franchise Agreements 77
SECTION VII.21 Year 2000 Requirement 78
ARTICLE VIII CONDITIONS OF LENDING 78
SECTION VIII.1 Conditions Precedent to Closing Date 78
SECTION VIII.2 Conditions Precedent to Initial Borrowing 80
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SECTION VIII.3 Conditions Precedent to Each Borrowing 81
SECTION VIII.4 Conditions Precedent to Conversions and Continuations 82
ARTICLE IX AFFIRMATIVE COVENANTS 82
SECTION IX.1 Existence 83
SECTION IX.2 Repair 83
SECTION IX.3 Insurance 83
SECTION IX.4 Obligations and Taxes 84
SECTION IX.5 Financial Statements; Reports 84
(a) Annual Audit Reports 84
(b) Quarterly Financial Statements 84
(c) Officer's Certificate 84
(d) SEC and Other 84
(e) Manufacturer/Dealer Statements 85
(f) Inventory Detail Report 85
(g) Availability Analysis 85
(h) Requested Information 85
SECTION IX.6 Litigation and Other Notices 85
(a) Judgment 85
(b) Suits and Proceedings 85
(c) Default 85
(d) Material Adverse Change 85
(e) Pension and Welfare Plans 86
(f) Other Events 86
SECTION IX.7 ERISA 86
SECTION IX.8 Books, Records and Access 86
SECTION IX.9 Use of Proceeds 86
(a) Floor Plan Loans 86
(b) Acquisition Loans 86
(c) Swing Line Loans 86
(d) All Loans 86
SECTION IX.10 Nature of Business 87
SECTION IX.11 Compliance 87
SECTION IX.12 Audits 87
(a) Entry on Premises 87
(b) Excess/Payments in Process 87
SECTION IX.13 Demonstrators and Rental Motor Vehicles 88
SECTION IX.14 Disbursement Account. 88
SECTION IX.15 Further Assurances 89
SECTION IX.16 Permitted Acquisitions 89
SECTION IX.17 Ford Borrower and GM Borrower Dividends 89
ARTICLE X NEGATIVE COVENANTS 92
SECTION X.1 Indebtedness 92
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SECTION X.2 Liens 93
SECTION X.3 Consolidations and Mergers 94
SECTION X.4 Disposition of Assets 94
SECTION X.5 Investments 95
SECTION X.6 Transactions with Affiliates 96
SECTION X.7 Other Agreements 97
SECTION X.8 Fiscal Year; Accounting 97
SECTION X.9 Credit Standards 97
SECTION X.10 Pension Plans 97
SECTION X.11 Capital Expenditures 97
SECTION X.12 Stockholders Equity 97
SECTION X.13 Restricted Payments 97
SECTION X.14 Fixed Charge Coverage Ratio 98
SECTION X.15 Interest Coverage Ratio 98
SECTION X.16 Leverage Ratio and Total Leverage Ratio 98
SECTION X.17 Current Ratio 98
SECTION X.18 INTENTIONALLY DELETED 98
SECTION X.19 Alternative Floor Plan Financing 98
ARTICLE XI EVENTS OF DEFAULT 99
SECTION XI.1 Events of Default 99
ARTICLE XII THE AGENT AND FLOOR PLAN AGENT 102
SECTION XII.1 Authorization and Action of the Agent; Rights and Duties Regarding
Collateral 102
SECTION XII.2 Agent's Reliance, Etc 106
SECTION XII.3 Agent and Affiliates; Chase and Affiliates 106
SECTION XII.4 Agent's Indemnity 107
SECTION XII.5 Lender Credit Decision 108
SECTION XII.6 Successor Agent 109
SECTION XII.7 Notice of Default 109
SECTION XII.8 Authorization and Action of the Floor Plan Agent 109
SECTION XII.9 Floor Plan Agent's Reliance, Etc 110
SECTION XII.10 Floor Plan Agent and Affiliates; Comerica Bank and Affiliates 111
SECTION XII.11 Floor Plan Agent's Indemnity 111
SECTION XII.12 Lender Credit Decision 112
SECTION XII.13 Successor Floor Plan Agent 112
SECTION XII.14 Notice of Default 113
SECTION XII.15 Documentation Agent; Co-Agent 113
ARTICLE XIII MISCELLANEOUS 114
SECTION XIII.1 Notices, Etc 114
SECTION XIII.2 Survival of Agreement 115
SECTION XIII.3 Successors and Assigns; Participations 115
SECTION XIII.4 Expenses of the Lenders; Indemnity 118
SECTION XIII.5 Right of Setoff 119
SECTION XIII.6 Governing Law; Jurisdiction 120
SECTION XIII.7 Waivers; Amendments 121
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SECTION XIII.18 Interest 122
SECTION XIII.9 Severability; Conflicts 123
SECTION XIII.10 Counterparts 123
SECTION XIII.11 Binding Effect 123
SECTION XIII.12 Further Assurances 123
SECTION XIII.13 Subsidiary Solvency Savings Clause 123
SECTION XIII.14 Joint and Several Liability and Related Matters 124
SECTION XIII.15 WAIVER OF JURY TRIAL 126
SECTION XIII.16 Loans Under Prior Credit Agreement 126
SECTION XIII.17 FINAL AGREEMENT OF THE PARTIES 127
SECTION XIII.18 CONFIDENTIALITY 127
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THIS FOURTH AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT dated
October 15, 1999, and effective as of November 1, 1999, is entered into among
GROUP 1 AUTOMOTIVE, INC., a Delaware corporation (the "Company"), each of the
Subsidiaries of the Company listed on the signature pages hereof and such other
Subsidiaries of the Company which hereafter shall become parties to this
Agreement (the Company and the Subsidiaries are sometimes referred to herein as,
individually, a "Borrower," and collectively, the "Borrowers"), the lenders
listed on the signature pages hereof (the "Lenders"), CHASE BANK OF TEXAS, N.A.,
a national banking association, as Administrative Agent for the Lenders (in such
capacity together with any successor in such capacity pursuant to Section 12.6,
the "Agent"), COMERICA BANK, a Michigan banking association, as Floor Plan Agent
for the Lenders (in such capacity together with any successor in such capacity
pursuant to Section 12.13, the "Floor Plan Agent"), Bank of America, N.A., as
Documentation Agent, U.S. Bank National Association, Bank One Texas, N.A. and
BankBoston, N.A., as Co-Agents.
RECITALS
WHEREAS, on December 31, 1997, the Borrowers, the lenders party
thereto, the Agent and the Floor Plan Agent entered into the Revolving Credit
Agreement (the "Initial Agreement"), whereby, upon the terms and conditions
therein stated, such lenders agreed to make loans to the Borrowers up to the
aggregate amount of $125,000,000, to be used by the Borrowers for the purposes
set forth in Section 9.9 of the Initial Agreement; and
WHEREAS, on, June 19, 1998, the Borrowers, the lenders party thereto,
the Agent and the Floor Plan Agent amended the Initial Agreement and entered
into an Amended and Restated Revolving Credit Agreement (hereinafter called the
"Amended and Restated Agreement") whereby, upon the terms and conditions therein
stated, such lenders agreed to make loans to the Borrowers up to the aggregate
amount of $345,000,000 to be used by the Borrowers for the purposes set forth in
Section 9.9 of the Amended and Restated Agreement; and
WHEREAS, on, November 10, 1998, the Borrowers, the lenders party
thereto, the Agent and the Floor Plan Agent amended the Amended and Restated
Agreement and entered into the Second Amended and Restated Revolving Credit
Agreement (hereinafter called the "Second Amended and Restated Agreement")
whereby, upon the terms and conditions therein stated, such Lenders agreed to
make loans to the Borrowers up to the aggregate amount of $425,000,000 to be
used by the Borrowers for the purposes set forth in Section 9.9 of the Second
Amended and Restated Agreement; and
WHEREAS, on, May 12, 1999, the Borrowers, the lenders parties thereto,
the Agent and the Floor Plan Agent amended the Second Amended and Restated
Revolving Credit Agreement and entered into the Third Amended and Restated
Revolving Credit Agreement (hereinafter called the "Third Amended and Restated
Agreement") whereby, upon the terms and conditions therein stated, such lenders
agreed to make loans to the Borrowers up to the aggregate amount of $500,000,000
to
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be used by the Borrowers for the purposes set forth in Section 9.9 of the Third
Amended and Restated Agreement; and
WHEREAS, the Borrowers, the Lenders, the Agent and the Floor Plan Agent
mutually desire to amend certain aspects of the Third Amended and Restated
Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINED TERMS, ACCOUNTING TERMS AND
CONSTRUCTION
SECTION I.1 Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABR Borrowing" means a Borrowing comprised of Alternate Base Rate
Loans.
"Accounts" means any and all rights of the Company or any of its
Subsidiaries to payment for goods and services sold or leased, including any
such right evidenced by chattel paper, whether due or to become due, whether or
not it has been earned by performance, and whether now or hereafter acquired or
arising in the future, including accounts receivable from Affiliates.
"Acquisition" means the acquisition by the Company or any of its wholly
owned Subsidiaries of (i) not less than one hundred percent (100%) of the
capital stock or other evidence of equity ownership of an Auto Dealer, or (ii)
all or substantially all of the assets of an Auto Dealer.
"Acquisition Loan" has the meaning specified in Section 3.1.
"Acquisition Loan Advance Limit" means, as of any Borrowing Date of an
Acquisition Loan, for the Company and its Subsidiaries on a consolidated basis,
calculated as of the last day of the most recently ended fiscal quarter or year
for which financial statements have been delivered under either Section 7.5 or
9.5, an amount equal to the lesser of (a) $220,000,000 MINUS the amount, if any,
of any portion of the Acquisition Loan Commitment allocated to Floor Plan
Borrowings or the Floor Plan Loan Commitment, or (b) the sum of (i) the
aggregate amount for all Qualifying Subsidiaries of two (2) times the difference
between Pro Forma EBITDA of each such Qualifying Subsidiary MINUS Pro Forma
Interest Expense of each such Qualifying Subsidiary PLUS (ii) the lesser of (y)
the aggregate amount for all Qualifying Ford Subsidiaries of two (2) times the
difference between Pro Forma EBITDA of each such Qualifying Ford Subsidiary
MINUS Pro Forma Interest Expense of each such Qualifying Ford Subsidiary, or (z)
the amount derived under clause (x) of the definition of the Ford Borrower
Liability Amount. If the purpose of any Borrowing of an Acquisition Loan is to
make a Permitted Acquisition, then the foregoing amounts shall be calculated to
give effect to such
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Permitted Acquisition as if such Acquisition had been consummated on or before
the last day of the fiscal quarter immediately preceding such Borrowing Date.
"Acquisition Loan Commitment" means for each Lender, its obligation to
make Acquisition Loans to the Company up to the amount set forth opposite such
Lender's name on Schedule I under the caption "Acquisition Loan Commitments" (as
the same may be permanently terminated or reduced or increased from time to time
pursuant to the applicable provisions in Sections 2.3(g)(iii), 3.4, 5.5, or 11.1
and as such amount may be increased or decreased from time to time by assignment
or assumption pursuant to Section 13.3(b)).
"Addendum" means the form of Addendum substantially in the form of
Exhibit A.
"Adjusted Indebtedness" means, as of any date of determination, for the
Company and its Subsidiaries, on a consolidated basis, the difference between
(a) Indebtedness and (b) the sum of (i) Floor Plan Loans outstanding, (ii)
Retail Loan Guaranties not in excess of ten percent (10%) of Stockholder's
Equity and (iii) Subordinated Indebtedness.
"Adjusted Total Indebtedness" means, as of any date of determination,
for the Company and its Subsidiaries, on a consolidated basis, the difference
between (a) Indebtedness and (b) the sum of (i) Floor Plan Loans outstanding,
and (ii) Retail Loan Guaranties not in excess of ten percent (10%) of
Stockholders' Equity.
"Adjustment Period" means the period of time commencing on a Floor Plan
Adjustment Date and ending on the next succeeding Floor Plan Adjustment Date.
"Administrative Questionnaire" means an Administrative Questionnaire in
the form of Exhibit B hereto, which each Lender shall complete and provide to
the Agent.
"Affiliate" means any Person (including any member of the immediate
family of any such natural person) who directly or indirectly beneficially owns
or controls five percent (5%) or more of the total voting power of shares of
capital stock of the Company having the right to vote for directors under
ordinary circumstances, any Person controlling, controlled by or under common
control with any such Person (within the meaning of Rule 405 under the
Securities Act of 1933), and any director or executive officer of such Person.
"Agency Fee(s)" has the meaning specified in Section 5.4(b).
"Agent" has the meaning specified in the introduction to this
Agreement.
"Agent's Letter" has the meaning specified in Section 5.4(b).
"Agreement" shall mean this Fourth Amended and Restated Revolving
Credit Agreement.
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"Alternate Base Rate" means, for any day, a fluctuating rate per annum
(rounded upwards to the next highest one-eighth (1/8th) of one percent (1%) if
not already an integral multiple of one-eighth (1/8th) of one percent (1%))
equal to the greater of (a) the Prime Rate in effect on such day, or (b) the
Federal Funds Effective Rate in effect on such day plus one-half (1/2) of one
percent (1%). "Prime Rate" shall mean, as of a particular date, the prime rate
most recently announced by Chase and thereafter entered in the minutes of
Chase's Loan and Discount Committee, automatically fluctuating upward and
downward with and, at the time specified in each such announcement, without
notice to any Borrower or any other Person, which prime rate may not necessarily
represent the lowest or best rate actually charged to a customer. "Federal Funds
Effective Rate" shall mean, for any day, an interest rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Agent from three
federal funds brokers of recognized standing selected by it. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the effective date of such change in the
Prime Rate, or the Federal Funds Effective Rate, respectively.
"Alternate Base Rate Loan" means any Loan with respect to which the
Company shall have selected an interest rate based on the Alternate Base Rate in
accordance with the provisions of this Agreement.
"Applicable Interest Rate" means the LIBO Rate, the Alternate Base
Rate, or the Comerica Prime-based Rate, as selected by the Company from time to
time subject to the terms and conditions of this Agreement.
"Applicable Margin" means, on any date, with respect to Eurodollar
Loans which are Acquisition Loans or to Alternate Base Rate Loans, as the case
may be, the applicable percentages set forth below based upon the Total Leverage
Ratio as in effect as of such date.
Total Leverage Eurodollar Alternate Base
Ratio Margin Rate Margin
----- ------ -----------
Category 1 x > 2.50 3.25% 1.75%
Category 2 1.75 < x <= 2.50 3.00% 1.50%
Category 3 1.25 < x <= 1.75 2.50% 1.00%
Category 4 1.00 < x <= 1.25 2.00% .50%
Category 5 x <= 1.00 1.75% .25%
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Each change in the Applicable Margin shall apply to all Eurodollar
Loans that are outstanding at any time during the period commencing on the
effective date of such change and ending on the date immediately preceding the
effective date of the next such change.
"Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of a Comerica Prime Rate Loan and
an Alternate Base Rate Loan and such Lender's Eurodollar Lending Office in the
case of a Eurodollar Loan.
"Assignment and Acceptance" has the meaning specified in Section
13.3(b).
"Auto Dealer" means a Person engaged in the sale of new and/or Used
Motor Vehicles pursuant to a franchise or licensing agreement with a
Manufacturer and related operations.
"Board" means the Board of Governors of the Federal Reserve System of
the United States.
"Book Value" means the wholesale value set forth in the most recent
edition of the National Automotive Dealers Association ("N.A.D.A.") Official
Used Car Guide Retail Edition.
"Borrower" or "Borrowers" has the meaning specified in the introduction
to this Agreement.
"Borrowing" means a Loan or a group of Loans of a single Type made by
the Lenders on a single date and as to which a single Interest Period is in
effect.
"Borrowing Date" means, with respect to each Borrowing, the Business
Day upon which the proceeds of such Borrowing are made available to any
Borrower.
"Business Day" means a day when the Agent and each Lender are open for
business, and if the applicable Business Day relates to any Eurodollar Loan, a
day on which dealings are carried on in the London interbank market and
commercial banks are open for domestic or international business in London,
England, in ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, and in Houston, Texas.
"Capital Lease" means any lease required to be accounted for as a
capital lease under GAAP.
"Cash Collateral Account" has the meaning specified in Section 6.8(a).
"Cash Receipted" means, in connection with the sale of a Motor Vehicle,
that cash has been received upon the sale thereof.
"Change of Control" will be deemed to have occurred if either (a) the
shares of the Company shall cease to be publicly traded or (b) at any time after
the Closing Date, individuals who were directors of the Company on the Closing
Date shall cease to constitute a majority of the members of the board of
directors of the Company.
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"Chase" means Chase Bank of Texas, N.A. and its successors and assigns
as permitted in this Agreement.
"Closing Date" means effective as of November 1, 1999, the earliest
date upon which all of the following shall have occurred: (a) counterparts of
this Agreement and all of the Loan Documents shall have been executed by each
Borrower, each Lender, the Agent, (b) the Floor Plan Agent and the Agent shall
have received counterparts hereof which taken together, bear the signature of
all such signatories, and (c) all of the other conditions to the initial
Borrowing or the issuance of any Letters of Credit set forth in Section 8.1
hereof shall have been satisfied.
"Code" means the Internal Revenue Code of 1986 and any successor
statute of similar import, together with the regulations thereunder, in each
case as in effect from time to time. References to sections of the Code shall be
construed to also refer to any successor sections.
"Collateral" means the collateral described in each of the Loan
Documents including the Security Documents and shall include (a) the proceeds
(net of cash, taxes and other expenses associated with such disposition) from
the disposition of the capital stock and any other equity interests of all
Subsidiaries of the Company or other Borrowers, now or hereafter existing, and
(b) with respect each of the Borrowers, (i) all inventory, including without
limitation, Motor Vehicles, (ii) all Accounts, (iii) all equipment, machinery,
furniture and fixtures, and (iv) all real estate owned or leased by any Phase 1
Borrower upon which a Lien has been granted as of the Closing Date.
"Comerica Alternate Base Rate" shall mean, for any day, an interest
rate per annum equal to the Federal Funds Effective Rate in effect on such day,
plus one percent (1%).
"Comerica Prime-based Rate" shall mean, for any day, that rate of
interest which is equal to (a) the greater of (i) the Comerica Prime Rate and
(ii) the Comerica Alternate Base Rate minus (b) 0.50%.
"Comerica Prime Rate" shall mean the per annum rate of interest
announced by the Floor Plan Agent, at its main office from time to time as its
"prime rate" (it being acknowledged that such announced rate may not necessarily
be the lowest rate charged by the Floor Plan Agent to any of its customers),
which rate shall change simultaneously with any change in such announced rate.
"Comerica Prime Rate Loan" or "Comerica Prime Rate Borrowing" means any
Loan with respect to which the Company shall have selected an interest rate
based on the Comerica Prime-based Rate in accordance with the provisions of this
Agreement.
"Commitment" means (a) for each Lender (or, as to any Person who
becomes a Lender after the Closing Date), the sum of (i) such Lender's
Acquisition Loan Commitment, plus (ii) such Lender's Floor Plan Loan Commitment;
and (b) for the Swing Line Bank, its obligation to make Swing Line Loans to the
Floor Plan Borrowers up to the amount of the Swing Line Commitment as the same
may be increased or decreased pursuant to the provisions of Sections
2.3(g)(iii), 3.4 or 5.5.
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"Commitment Fees" means, collectively, the Floor Plan Loan Commitment
Fees and the Acquisition Loan Commitment Fees as such terms are defined in
Section 5.4(a).
"Communications" has the meaning specified in Section 13.1.
"Company" has the meaning specified in the introduction to this
Agreement.
"Confidential Information Memorandum" means the Confidential
Information Memorandum dated September, 1999 furnished by Chase Securities Inc.,
as Arranger on behalf of the Agent, the Floor Plan Agent and the Lenders,
relating to the credit facilities evidenced by this Agreement as the same may be
updated or amended from time to time.
"Consolidated EBITDA" means, for any period for which the amount
thereof is to be determined, Consolidated Net Income for such period, plus, to
the extent deducted in the determination of Consolidated Net Income and without
duplication with items included in the adjustments under GAAP to net income in
the determination of Consolidated Net Income, (a) provisions for income taxes,
(b) Interest Expense, (c) depreciation and amortization expense, and (d) other
non-cash income or charges.
"Consolidated Net Income" means for any period for which the amount
thereof is to be determined, the Net Income of the Company in accordance with
GAAP.
"Consolidated Pro Forma EBITDA" means, Pro Forma EBITDA of the Company
and its Subsidiaries, determined on a consolidated basis.
"Current Ratio" means, as of any date of determination, for the Company
and its Subsidiaries on a consolidated basis, the quotient of (a) current assets
as of such date divided by (b) the sum of current liabilities and (to the extent
not otherwise included in current liabilities) the outstanding balance of all
Floor Plan Indebtedness as of such date.
"Curtailment Date" means (a) with respect to a new Motor Vehicle, one
year after the date it is Deemed Floored, (b) with respect to a Fleet Motor
Vehicle, thirty (30) days from the date it is Deemed Floored, (c) with respect
to a Demonstrator, two hundred ten (210) days from the date it is Deemed
Floored, (d) with respect to a Used Motor Vehicle, one hundred twenty (120) days
from the date it is Deemed Floored, (e) with respect to a Program Car, one
hundred eighty (180) days from the date it is Deemed Floored, and (f) with
respect to a Rental Motor Vehicle the first to occur of (y) two (2) years from
the date it is Deemed Floored or (z) the introduction by the Manufacturer of the
third model year for such Motor Vehicle.
"Dealer Franchise Agreement" has the meaning specified in Section 7.20.
"Deemed Floored" means with respect to a Motor Vehicle, the earlier of
(a) the date a Floor Plan Loan Borrowing is deemed by the Floor Plan Agent, in
its sole discretion, to be advanced by
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the Floor Plan Agent; or (b) thirty (30) days after an advance is made on a
Floor Plan Loan with respect to such Motor Vehicle.
"Default" means any event or condition which, with the lapse of time or
giving of notice or both, would constitute an Event of Default.
"Demonstrator" means a new Motor Vehicle with mileage resulting from
customer test drives or use of such Motor Vehicle by dealership personnel.
"Disposition" means the sale, lease, conveyance or other disposition of
property.
"Dollars" and the symbol "$" mean the lawful currency of the United
States of America.
"Domestic Lending Office" means, with respect to any Lender, the office
of such Lender specified as its "Domestic Lending Office" on such Lender's
signature page to this Agreement or, as to any Person who becomes a Lender after
the Closing Date, on the signature page of the Assignment and Acceptance
executed by such Person or such other office of such Lender as such Lender may
hereafter designate from time to time as its "Domestic Lending Office" by notice
to the Company and the Agent.
"Draft" means a draft on a Floor Plan Borrower's account at the Floor
Plan Agent made by a Manufacturer in accordance with the terms of a Drafting
Agreement by and among the Floor Plan Agent, the Manufacturer and/or any of the
Borrowers.
"Drafting Agreement" means an agreement (whether or not issued in the
form of a letter of credit) by and between the Floor Plan Agent and a
Manufacturer, entered into for the account of a Floor Plan Borrower (and in some
cases acknowledged or countersigned by a Floor Plan Borrower) under which a
Manufacturer is entitled to submit Drafts to the Floor Plan Agent (via ACH
electronic transfer or otherwise) for payment of invoices identifying Motor
Vehicles delivered or shipped to the applicable Floor Plan Borrower, such
agreements to be substantially in the form of the existing Drafting Agreements
identified in Schedule II hereto or otherwise on terms and conditions consistent
with the usual customs and practices in effect from time to time for the floor
plan industry.
"EBITDA" means, for any Person, for any period for which the amount
thereof is to be determined, Net Income for such period, plus, to the extent
deducted in the determination of Net Income and without duplication with items
included in the adjustments under GAAP to Net Income in the determination of net
income, (a) provisions for income taxes, (b) Interest Expense, (c) depreciation
and amortization expense and (d) other non-cash income or charges.
"Earnings Available for Fixed Charges" means, for any period for which
the amount thereof is to be determined, Consolidated EBITDA plus (a) lease
expense of the Company and its Subsidiaries on a consolidated basis minus (b)
the cash income taxes of the Company and its Subsidiaries, determined on a
consolidated basis as reported in the annual audited and the quarterly unaudited
financial statements.
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"Eligible Assignee" means (a) any Lender or any Affiliate of any Lender
other than an affiliate of a Lender engaged in the business of consolidating
automotive dealerships (b) a commercial bank organized under the laws of the
United States, or any state thereof, and having total assets in excess of One
Billion Dollars ($1,000,000,000) or its equivalent in any other currency and
having deposits that rated in either of the two highest generic letter rating
categories (without regard to subcategories) from either S&P or ▇▇▇▇▇'▇ or a
comparable nationally recognized national or international rating agency; (c) a
commercial bank organized under the laws of any other country which is a member
of the OECD, or a political subdivision of any such country, and having total
assets in excess of One Billion Dollars ($1,000,000,000) or its equivalent in
any other currency, provided that such bank is acting through a branch or agency
located in the country in which it is organized or another country which is also
a member of the OECD; (d) the central bank of any country which is a member of
the OECD; (e) the finance subsidiary of a Manufacturer; or (f) any other Person
approved by the Agent and the Company (if such consent is required pursuant to
Section 13.3) whose consent shall not be unreasonably withheld.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
any successor statute of similar import, together with the regulations
thereunder, in each case as in effect from time to time. References to sections
of ERISA shall be construed to also refer to any successor sections.
"ERISA Affiliate" means any corporation, trade or business that is,
along with the Company, a member of a controlled group of corporations or a
controlled group of trades or businesses, as described in Sections 414(b) and
414(c), respectively, of the Code or Section 4001 of ERISA.
"Escrow and Security Agreement" means an Escrow and Security Agreement
substantially in the form of Exhibit D attached hereto, executed by the Company
and certain other Borrowers in favor of the Agent for the benefit of the Lenders
with respect to all of the capital stock and other equity interests of the
Company's direct and indirect Subsidiaries with respect to which the Company or
such other Borrower is not prohibited by a Manufacturer from being a party
thereto.
"Eurodollar Borrowing" means a Borrowing comprised of Eurodollar Loans.
"Eurodollar Lending Office" means, with respect to each Lender, the
branches or Affiliates of such Lender which such Lender has designated as its
"Eurodollar Lending Office" on such Lender's signature page to this Agreement
or, as to any Person who becomes a Lender after the Closing Date, on the
signature page of the Assignment and Acceptance executed by such Person or such
other office of such Lender as such Lender may hereafter designate from time to
time as its "Eurodollar Lending Office" by notice to the Company and the Agent.
"Eurodollar Loan" means any Loan with respect to which the Company
shall have selected an interest rate based on the LIBO Rate in accordance with
the provisions of this Agreement; provided; however, Eurodollar Loan shall
include, as the context may require, Swing Line Loans carried at the Quoted
Rate.
"Event of Default" has the meaning specified in Section 11.1.
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"Excess/Payments in Process" means, as of any date of determination,
the funds transferred from any Floor Plan Borrower to the Floor Plan Agent in
payment of Floor Plan Loans which have at such time not yet been applied on a
VIN specific basis.
"Federal Funds Effective Rate" has the meaning specified in the
definition of "Alternate Base Rate."
"Fixed Charges" means, for any period for which the amount thereof is
to be determined, the sum of Interest Expense, lease expense, principal
payments, cash dividends, and capital expenditures (other than capital
expenditures on Property which is or will be within six (6) months of the date
of such expenditures the subject of a Qualified Sale/Leaseback Transaction), in
each case, for the Company and its Subsidiaries, determined on a consolidated
basis.
"Fixed Charge Coverage Ratio" means the quotient of (a) Earnings
Available for Fixed Charges divided by (b) Fixed Charges.
"Fleet Motor Vehicle" means one of a large group of new Motor Vehicles
sold to a purchaser (e.g., a rental car agency) which purchases vehicles for
short term use.
"Floor Plan Adjustment Date" means each of (a) the last Business Day of
each calendar month, and (b) the first Business Day after two (2) Business Days
prior written notice from the Swing Line Bank to the Agent requesting therein a
Floor Plan Adjustment Date, but in any event not less frequently than once each
calendar month.
"Floor Plan Advance Limit" means (a) with respect to new Motor
Vehicles, Demonstrators, and Rental Motor Vehicles, the wholesale purchase price
charged by a Manufacturer as reflected in the invoice to the Company or any
other Floor Plan Borrower for such Motor Vehicles, and (b) with respect to Used
Motor Vehicles and Program Cars, the cost of such Motor Vehicles to the Company
or any other Floor Plan Borrower; provided, however, with respect to
Demonstrators, Used Motor Vehicles, Program Cars, and Rental Motor Vehicles, (i)
the aggregate amount of Floor Plan Loans outstanding at any time in connection
with Used Motor Vehicles may not exceed an amount equal to fifty-five percent
(55%) of the aggregate Book Value of all Used Motor Vehicles of the Floor Plan
Borrowers, as reflected in their current Manufacturer/Dealer Statement, (ii) the
aggregate amount of Floor Plan Loans outstanding at any time in connection with
Used Motor Vehicles and Program Cars may not exceed One Hundred Thirty Million
Dollars ($130,000,000), (iii) the aggregate amount of Floor Plan Loans
outstanding at any time in connection with Demonstrators may not exceed Forty
Million Dollars ($40,000,000), and (iv) the aggregate amount of Floor Plan Loans
outstanding at any time in connection with Rental Motor Vehicles may not exceed
Twenty Million Dollars ($20,000,000).
"Floor Plan Agency Fee" has the meaning specified in Section 5.4(c).
"Floor Plan Borrowers" shall mean the Company and/or any Floor Plan
Subsidiaries.
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"Floor Plan Indebtedness" means (without duplication) all Indebtedness
of the Borrowers secured by Motor Vehicles.
"Floor Plan Interest Expense" means that component of the Company's
aggregate Interest Expense, determined on a consolidated basis, attributable to
Floor Plan Indebtedness.
"Floor Plan Loan" has the meaning specified in Section 2.1.
"Floor Plan Loan Commitment" means for each Lender, its obligation to
make Floor Plan Loans to the Floor Plan Borrowers up to the amount set forth
opposite such Lender's name on Schedule I under the caption "Floor Plan Loan
Commitments" (as the same may be increased, permanently terminated, reduced or
increased from time to time pursuant to the applicable provisions of Sections
2.3(g)(iii), 3.4, 5.5 or 11.1 and as such amount may be increased or decreased
from time to time by assignment or assumption pursuant to Section 13.3(b)).
"Floor Plan Subsidiary" means any Subsidiary of the Company which has
granted a Lien to the Agent for the benefit of the Lenders on its Property in
the manner required by the Loan Documents.
"Ford Borrower Liability Amount" means, at any time, an amount equal to
the lesser of (a) all Obligations owed to the Lenders by the Company and/or any
of the Ford Borrowers or (b) at any time of determination thereof, (i) an amount
equal to all Floor Plan Loans outstanding to any Ford Borrower, PLUS (ii) an
amount equal to the greater of (y) $25,000,000 or (z) all cash consideration
paid by the Company or any of its Subsidiaries in connection with the
acquisition of the stock or other equity interest, or assets of any Auto Dealer
engaged in the sale of new Motor Vehicles manufactured by Ford Motor Company
PLUS (A) an amount equal to all reasonable costs and expenses associated with
the collection and enforcement of the obligations of any Ford Borrower arising
under the Loan Documents including attorneys' fees PLUS (B) an amount equal to
all capital contributions and expenditures for capital or fixed assets, made by
the Company or any of its Subsidiaries on behalf of any Ford Borrower.
"Ford Borrower" means any Subsidiary of the Company engaged in the sale
of new Motor Vehicles manufactured by any division of the Ford Motor Company.
"Fronting Fees" has the meaning specified in Section 6.7(b).
"GAAP" means generally accepted accounting principles as in effect, as
of the applicable date of determination thereof, from time to time as set forth
in the opinions, statements and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and the
Financial Accounting Standards Board and applied on a consistent basis.
"GM Borrower" means the Borrowers set forth in Schedule XV and any
other Subsidiary of the Company engaged in the sale of new Motor Vehicles
manufactured by any division of General Motors Corporation.
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"GM Borrower Guaranty" means the Form of Guaranty Agreement
substantially in the form of Exhibit L.
"GM Borrower Liability Amount" means, at any time, the sum of (a) an
amount equal to the Floor Plan Borrowings of all GM Borrowers and (b) all
reasonable costs and expenses associated with the collection and enforcement of
the obligations of any GM Borrower arising under the Loan Documents including
attorneys' fees and expenses in connection with Floor Plan Loans of any GM
Borrower.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of, or pertaining to,
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Guaranties" by any Person means all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing, or in effect guaranteeing,
any Indebtedness, dividend or other obligation of any other Person (the "Primary
Obligor") in any manner, whether directly or indirectly, including all
obligations incurred through an agreement, contingent or otherwise, by such
Person:
(a) to purchase such Indebtedness or obligation or any
property or assets constituting security therefor,
(b) to advance or supply funds (a) for the purchase or payment
of such Indebtedness or obligation, (b) to maintain working capital or other
balance sheet condition or otherwise to advance or make available funds for the
purchase or payment of such Indebtedness or obligation,
(c) to lease property under a Capital Lease or any other
lease, the lessee under which is a Person other than the Company or wholly-owned
Subsidiary of the Company or to purchase securities or other property or
services primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the Primary Obligor to make payment of such
Indebtedness or perform such obligation, or
(d) otherwise to assure the owner of the Indebtedness or the
obligation of the Primary Obligor against loss in respect thereof.
For the purposes of all computations made under this Agreement, a Guaranty in
respect of any Indebtedness for borrowed money shall be deemed to be
Indebtedness equal to the principal amount of such Indebtedness for borrowed
money which has been guaranteed, and a Guaranty in respect of any other
obligation or liability or any dividend shall be deemed to be Indebtedness equal
to the maximum aggregate amount of such obligation, liability or dividend.
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"Hedging Agreement" shall mean any interest rate or currency swap, rate
cap, rate floor, rate collar, forward agreement, or other exchange or rate
protection agreement with the Agent, any Lender, or any affiliate of the Agent,
or any Lender or any option with respect to any such transaction.
"Highest Lawful Rate" means, as to any Lender, the maximum non-usurious
rate of interest, if any, that at any time or from time to time may be
contracted for, taken, reserved, charged or received on the aggregate principal
amount of all Loans under the laws of the United States of America and/or the
laws of the State of Texas as may be applicable thereto that are presently in
effect or, to the extent allowed under such applicable law, which may hereafter
be in effect and which allow a higher maximum non-usurious interest rate than
applicable law now allows. To the extent, if any, that the maximum non-usurious
rate is determined with reference to the laws of the State of Texas, the Highest
Lawful Rate shall be the "weekly" rate ceiling as defined in 303 of the Texas
Finance Code (as amended) (the "Act"), calculated on the basis of a 365/366 day
year; provided, however, that to the extent permitted by the Act, the Agent may
at its election or at the request of the Required Lenders substitute for the
"weekly" rate ceiling the "annual" or "quarterly" ceiling, as those terms are
defined in the Act, upon the giving of notices provided for by the Act and
effective upon the giving of such notices.
"Honor Date" has the meaning specified in Section 6.3(b).
"Indebtedness" of any Person means, without duplication:
(a) any obligation of such Person for borrowed money,
including any obligation of such Person evidenced by bonds, debentures, notes or
other similar debt instruments, and
(b) any obligation of such Person on account of deposits or
advances,
(c) all obligations of such Person under conditional sale or
other title retention agreements relating to property purchased by such Person,
(d) any obligation of such Person for the deferred purchase
price of any property or services, except accounts payable arising in the
ordinary course of such Person's business,
(e) rentals in respect of Capital Leases of such Person,
(f) Guaranties by such Person to the extent required pursuant
to the definition thereof,
(g) any Indebtedness of another Person secured by a Lien on
any asset of such first Person, whether or not such Indebtedness is assumed by
such first Person, and
(h) any Indirect Indebtedness of such Person.
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"Indemnitee" has the meaning specified in Section 13.4(b).
"Indirect Indebtedness" means preferred stock of a Person having a
mandatory redemption prior to the Maturity Date.
"Insolvency Proceeding" means (a) any case, action or proceeding
relating to bankruptcy, reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors, or (b) any general assignment for
the benefit of creditors, composition, marshaling of assets for creditors, or
other, similar arrangements in respect of its creditors generally or any
substantial portion of a Person's creditors, undertaken under federal law.
"Interest Coverage Ratio" means for any period the quotient of (a)
Consolidated EBITDA for such period divided by (b) Interest Expense of the
Company for such period.
"Interest Expense" means, for any Person, determined on a consolidated
basis, the sum of all interest on Indebtedness paid or payable (including the
portion of rents payable under Capital Leases allocable to interest, but
excluding interest allowances from Manufacturers) plus all original issue
discount and other interest expense associated with Indebtedness amortized or
required to be amortized in accordance with GAAP.
"Interest Payment Date" means, (a) with respect to Floor Plan Loans
(other than Swing Line Loans and Swing Line Overdraft Loans), the last day of
the Interest Period applicable to each such Loan (and, in addition, in the case
of any Interest Period more than 30 days' duration, the day that would have been
the Interest Payment Date of such Interest Period if such Interest Period had
been of one month or 30 days' duration), (b) with respect to Acquisition Loans
which are Eurodollar Loans, the last day of the Interest Period applicable to
each such Loan (and in addition, in the case of any Interest Period of six
months or 180 days' duration, the day that would have been the Interest Payment
Date of such Interest Period if such Interest Period had been of three months'
or 90 days' duration), (c) with respect to Alternate Base Rate Loans, on the
first Business Day of each January, April, July and October of each year,
commencing January 1, 2000 and with respect to Swing Line Loans, Swing Line
Overdraft Loans and Comerica Prime Rate Loans, on the fifth (5th) Business Day
of each month.
"Interest Period" means: with respect to:
(a) Floor Plan Loans and Swing Line Loans (i) subject to subsection (A)
below, as to any Eurodollar Loan, the period commencing on the date of
such Eurodollar Loan and ending not more than one month thereafter, as
the Company may elect, and (ii) as to any Comerica Prime Rate Loan, the
period commencing on the date of such Comerica Prime Rate Loan and
ending on the date such Loan is repaid or converted into a Eurodollar
Loan in accordance with the terms of Section 5.15(b); provided,
however, that (A) if any Interest Period would end on a day that shall
not be a Business Day, such Interest Period shall be extended to the
next succeeding Business Day (B) no Interest Period shall end later
than the Maturity Date
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and (C) interest shall accrue from and including the first day of an
Interest Period to but excluding the last day of such Interest Period;
and
(b) Acquisition Loans (i) as to any Eurodollar Loan, the period
commencing on the date of such Eurodollar Loan and ending on the
numerically corresponding day (or, if there is no numerically
corresponding day, on the last day) in the calendar month that is one,
two, three or six months thereafter, as the Company may elect and (ii)
as to any Alternate Base Rate Loan, a period commencing on the date of
such Loan and ending on the date such Loan is repaid or converted into
a Eurodollar Loan in accordance with the terms of Section 5.15(a);
provided, however, that (A) if any Interest Period would end on a day
that shall not be a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, with respect to
Eurodollar Loans only, such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end
on the next preceding Business Day, (B) no Interest Period shall end
later than the Maturity Date and (C) interest shall accrue from and
including the first day of an Interest Period to but excluding the last
day of such Interest Period.
"Inventory Detail Report" means a report delivered pursuant to Section
9.5(f) by the Company and the other Floor Plan Borrowers (on an individual and
consolidated basis) which breaks out in detail the new Motor Vehicles, Used
Motor Vehicles, Demonstrators, and Program Vehicles held by such Floor Plan
Borrower as reflected in its Manufacturer/Dealer Statements.
"Investment" means, as to any Person, any investment so classified
under GAAP made by stock purchase, capital contribution, loan or advance or by
purchase of property or otherwise, but in any event shall include as an
investment in any other Person the amount of all Indebtedness owed by such other
Person and all Accounts from such other Person which are not current assets or
did not arise from services rendered or sales to such other Person in the
ordinary course of business.
"Issue" means, with respect to any Letter of Credit, to issue or to
extend the expiration date of, or to renew or increase the amount of, such
Letter of Credit; and the terms "Issued," "Issuing" and "Issuance" have
corresponding meanings.
"Issuing Bank" means Chase Bank of Texas, N.A., in its capacity as
issuer of one or more Letters of Credit hereunder, together with any successor
letter of credit issuer and any replacement letter of credit issuer.
"Lenders" has the meaning specified in the introduction to this
Agreement, and Lender(s) shall include the Swing Line Bank unless the context
otherwise requires.
"Letter of Credit" means any letter of credit issued by the Issuing
Bank pursuant to Article VI.
"Letter of Credit Advance" means each Lender's participation in any
Letter of Credit Borrowing in accordance with its Pro Rata Share of Acquisition
Loan Commitments.
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"Letter of Credit Application" and "Letter of Credit Amendment
Application" means an application form for Issuance of, and for amendment of,
Letters of Credit as shall at any time be in use at the Issuing Bank, as the
Issuing Bank shall request.
"Letter of Credit Borrowing" means an extension of credit resulting
from a drawing under any Letter of Credit which shall not have been reimbursed
on the date when made from proceeds of a Borrowing of Acquisition Loans under
Section 6.3(b).
"Letter of Credit Commitment" means the obligation of the Issuing Bank
to Issue, and the obligation of the Lenders severally to participate in, Letters
of Credit from time to time Issued or outstanding under Article VI in an
aggregate amount not to exceed on any date the amount of Fifteen Million Dollars
($15,000,000); provided that the Letter of Credit Commitment of each Lender is a
part of its Acquisition Loan Commitment, rather than a separate, independent
commitment.
"Letter of Credit Fees" has the meaning specified in Section 6.7(a).
"Letter of Credit Obligations" means at any time the sum of (a) the
aggregate undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of all unreimbursed drawings under all Letters of Credit, including all
outstanding Letter of Credit Borrowings.
"Letter of Credit-Related Documents" means the Letters of Credit, the
Letter of Credit Applications, the Letter of Credit Amendment Applications and
any other document relating to any Letter of Credit, including any of the
Issuing Bank's standard for documents for Letter of Credit Issuances.
"Letter of Credit Termination Date" has the meaning provided in Section
6.1(a).
"Leverage Ratio" means as of any date of determination, for the
Company, the quotient of (a) Adjusted Indebtedness as of such date divided by
(b) (y) Consolidated Pro Forma EBITDA as of such date, minus (z) Pro Forma Floor
Plan Interest Expense of the Company and its Subsidiaries, determined on a
consolidated basis and after having given effect to any proposed Acquisition, as
of such date.
"LIBO Rate" means with respect to a Borrowing the rate (rounded to the
nearest one-sixteenth (1/16) of one percent (1%) or, if there is no nearest
one-sixteenth (1/16) of one percent (1%), the next higher one-sixteenth (1/16)
of one percent (1%)) at which dollar deposits approximately equal in principal
amount of such Borrowing and for a maturity equal to the applicable Interest
Period are offered in immediately available funds to the principal office of the
Agent in London, England (or if the Agent does not at the time any such
determination is made, maintain an office in London, England, the principal
office of any Affiliate of the Agent in London, England) by leading banks in the
London interbank market for Eurodollars at approximately 11:00 a.m., London,
England time, two Business Days prior to the commencement of such Interest
Period.
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"Lien" means any mortgage, pledge, hypothecation, judgment lien or
similar legal process, title retention lien, or other lien or security interest,
including the interest of a vendor under any conditional sale or other title
retention agreement and the interest of a lessor under any Capital Lease.
"Loan" means an Alternate Base Rate Loan, a Comerica Prime Rate Loan, a
Eurodollar Loan, an Acquisition Loan, a Floor Plan Loan, a Swing Line Loan, or a
Swing Line Overdraft Loan; and "Loans" means all such Loans made pursuant to
this Agreement
"Loan Documents" means this Agreement, the Notes, the Security
Documents, the Agent's Letter and all other documents and instruments executed
by the Borrowers or any other Person in connection with this Agreement and the
Loans.
"Manufacturer" means the manufacturer of a Motor Vehicle.
"Manufacturer/Dealer Statement" means a financial statement prepared by
a Floor Plan Borrower for a Manufacturer and delivered to the Manufacturer on a
monthly basis.
"Manufacturer's Certificate" means any Manufacturer's Statement of
Origin, Manufacturer's Certificate, MSO, Certificate of Origin or any other
document evidencing the ownership or transfer of ownership of a new Motor
Vehicle from a Manufacturer to any Borrower.
"Margin Stock" has the meaning specified in Regulation U.
"Material Adverse Effect" means, relative to any occurrence of whatever
nature (including any adverse determination in any litigation, arbitration or
governmental investigation or proceeding), (i) a material adverse effect on the
financial condition, business, operations, assets or prospects of the Company
and its Subsidiaries, on a consolidated basis, (ii) a material impairment of the
ability of the Company and its Subsidiaries on a consolidated basis or the Floor
Plan Subsidiaries as a group, to perform their Obligations under the Loan
Documents or (iii) a material impairment of the validity or enforceability of
the Loan Documents.
"Maturity Date" means December 31, 2003, or the earlier termination of
the Commitments under Sections 5.5 and 11.1 unless extended pursuant to Section
5.16.
"Maximum Permissible Rate" has the meaning specified in Section 13.8.
"Motor Vehicle" means an automobile, truck, van or any other motor
vehicle, including, without limitation, new Motor Vehicles, Used Motor Vehicles,
Program Cars, Fleet Motor Vehicles, Rental Motor Vehicles and Demonstrators.
"Net Income" means for any Person for any period for which the amount
thereof is to be determined the net income (or net losses) of such Person and
its Subsidiaries on a consolidated basis as determined in accordance with GAAP
after deducting, to the extent included in computing said net income and without
duplication, (i) the income (or deficit) of any Person (other than a
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Subsidiary) in which such Person or any of its Subsidiaries has any ownership
interest, except to the extent that any such income has been actually received
by such Person or such Subsidiary in the form of cash dividends or similar cash
distribution, (ii) any income (or deficit) of any other Person accrued prior to
the date it becomes a Subsidiary of such Person or merges into or consolidates
with such entity, (iii) the gain or loss (net of any tax effect) resulting from
the sale of any capital assets, (iv) any gains or losses or other income which
is non-recurring, extraordinary or attributable to discontinued operations, (v)
income resulting from the write-up of any assets, and (vi) any portion of the
net income of any Subsidiaries which is not available for distribution.
"Non-Recourse Real Estate Debt" means Indebtedness of a Subsidiary of
the Company existing as of the Closing Date and described in Schedule XII or
incurred in connection with an Acquisition, provided that such Indebtedness is
non-recourse to such Borrower and secured solely by real estate of such Borrower
used in the day-to-day operations of its business.
"Note" and "Notes" mean each of the Promissory Notes substantially in
the form of Exhibit C-1 duly executed by all of the Borrowers each payable and
delivered to each of the respective Lenders in the aggregate principal face
amount of the respective Lender's Commitment.
"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties, arising under any Loan Document or arising under any
Hedging Agreement owing by any Borrower to any Lender, the Agent, the Floor Plan
Agent, the Swing Line Bank, or the Issuing Bank, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to
become due, now existing or hereafter arising.
"OECD" means the Organization for Economic Cooperation and Development.
"Other Activities" has the meaning specified in Section 12.3.
"Other Financings" has the meaning specified in Section 12.3.
"Other Taxes" has the meaning specified in Section 5.14(b).
"Out of Balance" means (i) with respect to a Motor Vehicle, the
outstanding balance of the Floor Plan Loan pursuant to which such Motor Vehicle
was purchased exceeds the Floor Plan Advance Limit and (ii) with respect to a
Floor Plan Loan, the outstanding balance thereof has not been paid in accordance
with the terms of this Agreement; provided, however, that so long as the
outstanding balance of (y) Cash Receipted Motor Vehicles shall have been
received within five (5) days of the sale thereof and (z) Sale Dated Motor
Vehicles shall have been received within ten (10) days of the sale thereof, such
Loans shall not be considered Out of Balance.
"Out of Balance Amount" has the meaning specified in Section 9.12(b).
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
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"Performance Letter of Credit" has the meaning specified in Section
6.2.
"Permitted Acquisition" means (a) an Acquisition by the Company
pursuant to which (i) the total consideration (exclusive of stock or other
equity consideration) is less than or equal to Twenty Million Dollars
($20,000,000) and (ii) not less than one hundred percent (100%) of the capital
stock or other evidence of equity ownership (other than director qualifying
shares) of the target entity is acquired, and that satisfies all the
requirements for a Permitted Acquisition set forth in Section 9.16(a)(i), (ii),
(viii), and (ix) and Section 9.16(b); or (b) an Acquisition by the Company
pursuant to which (i) the total consideration (exclusive of stock or other
equity consideration) is greater than Twenty Million Dollars ($20,000,000), and
(ii) not less than one hundred percent (100%) of the capital stock or other
evidence of equity ownership (other than director qualifying shares) of the
target entity is acquired, and that satisfies all the requirements for a
Permitted Acquisition set forth in Section 9.16(a) and Section 9.16(b).
"Permitted Acquisition Notice" has the meaning specified in Section
9.16(a)(ii).
"Permitted Liens" means those Liens described in Section 10.2.
"Person" means any natural person, corporation, business trust,
association, company, limited liability company, joint venture, partnership or
government or any agency or political subdivision thereof.
"Phase 1 Borrower" means a Borrower which as of the Closing Date has
granted to the Agent for the benefit of the Lenders, a Lien on any of its real
property including any leasehold estate as security for the Obligations.
"Plan" means a "pension plan," as such term is defined in ERISA,
established or maintained by the Company or any of its Subsidiaries or any ERISA
Affiliate or as to which the Company or any of its Subsidiaries or any ERISA
Affiliate contributes or is a member or otherwise may have any liability.
"Prime Rate" has the meaning specified in the definition of the term
"Alternate Base Rate."
"Pro Forma EBITDA" means, for any Person, as of any date of
determination, based upon the immediately preceding four fiscal quarters, for
any period for which the amount thereof is to be determined, EBITDA of such
Person plus (or minus), without duplication, the EBITDA for such four quarter
period of any Person acquired during such period.
"Pro Forma Floor Plan Interest Expense" means, for any Person, as of
any date of determination, based upon the immediately preceding four fiscal
quarters of such Person, Floor Plan Interest Expense of such Person plus (or
minus), without duplication, the Floor Plan Interest Expense for such period of
any Person acquired during such period.
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"Pro Forma Interest Expense" means Pro Forma Floor Plan Interest
Expense plus pro forma Interest Expense of other permitted Indebtedness of the
Borrowers.
"Pro Rata Share of Acquisition Loan Commitments" means, at any time,
with respect to any Lender, the percentage corresponding to the fraction, the
numerator of which shall be the amount of the Acquisition Loan Commitment of
such Lender and the denominator of which shall be the aggregate amount of the
Acquisition Loan Commitments of all of the Lenders.
"Pro Rata Share of Floor Plan Loan Commitments" means, at any time,
with respect to any Lender, the percentage corresponding to the fraction, the
numerator of which shall be the amount of the Floor Plan Loan Commitment of such
Lender and the denominator of which shall be the aggregate amount of the Floor
Plan Loan Commitments of all the Lenders.
"Pro Rata Share of Total Commitments" means, at any time, with respect
to any Lender, the percentage corresponding to the fraction, the numerator of
which is such Lender's Commitment and the denominator of which shall be the
aggregate amount of the Commitments of all the Lenders.
"Program Car" means a Motor Vehicle in the current or immediately
preceding model year in readily saleable condition, previously used by a car
rental company as a part of its rental fleet or previously driven by an
executive of a Manufacturer before being offered for sale to the Company or any
other Floor Plan Borrower at a Manufacturer sponsored auction.
"Qualified Sale/Lease back Transaction" means the sale by any of the
Borrowers of real property and related fixtures and accessories thereto used in
ordinary course of business, which property is, in a concurrent transaction,
leased by such Borrower from the purchaser thereof under a lease agreement, the
terms of which, as of the date of such transaction, based upon the immediately
preceding four fiscal quarters of the Company, would not cause the Company to be
in Default of any of the provisions of Sections 10.14, 10.15, 10.16 or 10.17 or
any other provision of this Agreement.
"Qualifying Ford Subsidiary" means a Wholly-Owned Subsidiary that is a
Ford Borrower (i) which is a Floor Plan Subsidiary, (ii) which has granted a
general Lien and security interest in favor of the Agent for the benefit of the
Lenders in substantially all of the Property subject only to Permitted Liens,
(iii) which is a co-maker of the Notes with joint and several liability with all
other Ford Borrowers for all the Obligations to the extent of the Ford Borrower
Liability Amount, except as limited by Section 13.13 of this Agreement, (iv)
which has no Indebtedness except as permitted pursuant to Sections 10.1(a), (f),
(g), (l) and (m), and (v) which is in all other respects in compliance with the
terms of this Agreement.
"Qualifying Subsidiary" means a Wholly-Owned Subsidiary of the Company
(other than a Ford Borrower) which (i) is a Floor Plan Subsidiary, (ii) has
granted a general Lien and security interest in favor of the Agent for the
benefit of the Lenders on substantially all of its Property, subject only to
Permitted Liens, (iii) is a co-maker of the Notes with joint and several
liability with all other Borrowers for all the Obligations except as limited by
Section 13.13 of this Agreement, (iv) has no
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Indebtedness except as permitted pursuant to Section 10.1(a), (f), (g) (l) and
(m), and (v) is in all other respects in compliance with the terms of this
Agreement.
"Quoted Rate" shall mean the lesser of (i) rate of interest per annum
offered by Swing Line Bank in its sole discretion with respect to a Swing Line
Loan or a Swing Line Overdraft Loan, such rate to be derived from the LIBO Rate
(or other cost of funds, as selected by Swing Line Bank) on the applicable date
of determination, plus 1.5% and (ii) the Highest Lawful Rate.
"Refunded Swing Line Loans" has the meaning specified in Section
4.5(a).
"Register" has the meaning specified in Section 13.3(d).
"Regulation D" means Regulation D of the Board, as the same is from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.
"Regulation T" means Regulation T of the Board, as the same is from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.
"Regulation U" means Regulation U of the Board, as the same is from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.
"Regulation X" means Regulation X of the Board, as the same is from
time to time in effect, and all official rulings and interpretations thereunder
or thereof.
"Reportable Event" means a Reportable Event as defined in Section
4043(b) of ERISA.
"Rental Motor Vehicle" means a Motor Vehicle owned by a Floor Plan
Subsidiary and purchased directly from a Manufacturer as a new Motor Vehicle
which is less than two years old and which is used as a service loaner vehicle
or is periodically subject to a rental contract with customers of the Floor Plan
Subsidiary for loaner or rental periods of up to thirty (30) consecutive days.
"Request for Borrowing" means, in connection with a Floor Plan Loan, a
Swing Line Loan, or a Swing Line Overdraft Loan, a Request for Borrowing
substantially in the form attached hereto as Exhibit E-1, and in the case of an
Acquisition Loan, a Request for Borrowing substantially in the form attached
hereto as Exhibit E-2.
"Required Lenders" means, at any time, Lenders holding 66-2/3% of the
aggregate principal amount of the Loans and the Letter of Credit Obligations at
the time outstanding, as of the immediately preceded Floor Plan Adjustment Date
provided that, for purposes of determining Required Lenders hereunder, Swing
Line Loans shall be allocated among the Lenders based upon their respective Pro
Rata Share of the Floor Plan Loan Commitments, or if no such principal amount is
outstanding, Lenders having in the aggregate a Pro Rata Share of the Total
Commitments equal to sixty-six and two-thirds percent (66-2/3%) of the Total
Commitment.
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"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of any arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
"Reserve Commitment" has the meaning specified in Section 3.4.
"Restricted Payment" means, as to any Person, any dividend or other
distribution of assets, properties, cash, rights, obligations or securities made
by such Person or any Subsidiary of such Person on account of shares of such
Person's capital stock, or any partnership interest or similar ownership
interest in such Person, or any purchase, retirement, redemption or other
acquisition made by such Person or any Subsidiary of such Person of any of such
Person's capital stock, partnership interest or similar ownership interest or
warrants, rights or options evidencing a right to acquire such shares or
interests.
"Retail Loan Guarantees" means any Guaranty by the Company or any of
its Subsidiaries in favor of any Person of retail installment contracts or other
retail payment obligations in respect of Motor Vehicles sold to a customer.
"Sale Dated" means, in connection with the sale of a Motor Vehicle,
that closing of the sale of such Motor Vehicle is pending financing or other
contingencies.
"Security Agreement" means a Security Agreement substantially in the
form of Exhibit F attached hereto, executed by each of the Borrowers in favor of
the Agent for the benefit of the Lenders covering all assets of the Borrowers
described therein.
"Security Documents" means this Agreement, the Escrow and Security
Agreement, the Security Agreements, the agreements or instruments described or
referred to in Section 8.1(b) and any and all other agreements or instruments
now or hereafter executed and delivered by any Borrower or any other Person in
connection with, or as security for, the payments or performance of any of the
Obligations.
"Stockholders' Equity" means the consolidated stockholders' equity of
the Company and its Subsidiaries determined in accordance with GAAP after
eliminating all intercompany items and after deducting from stockholders' equity
such portion thereof as is properly attributable to minority interests in such
Subsidiaries.
"Subordinated Indebtedness" means (i) Indebtedness of any Borrower
having maturities and terms, and which is subordinated to payment of the Notes,
and approved in writing by the Agent and the Required Lenders which in the
aggregate, is less than twenty percent (20%) of Stockholders' Equity and (ii)
unsecured subordinated Indebtedness of the Company (which may be guaranteed by
the Subsidiaries of the Company on an unsecured basis) provided that such
Indebtedness (x) is subordinated to payment of the Notes as approved in writing
by the Agent, (y) does not have a maturity before the Maturity Date, and (z) has
terms that are no more restrictive than the terms of
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the Loan Documents and further provided that, after giving effect to the
issuance of such Indebtedness, no Default or Event of Default shall have
occurred or be continuing or would occur as a result thereof.
"Subsidiary" means any Person of which or in which any other Person
(the "Parent") and the other Subsidiaries of the Parent own directly or
indirectly fifty percent (50%) or more of:
(a) the combined voting power of all classes of stock having
general voting power under ordinary circumstances to elect a majority of the
board of directors of such Person, if it is a corporation;
(b) the capital interest or profits interest of such Person,
if it is a partnership, joint venture or similar entity; or
(c) the beneficial interest of such Person, if it is a trust,
association or other unincorporated organization.
The term Subsidiary (or Subsidiaries), as used in the introduction to
this Agreement, means a Subsidiary (or the Subsidiaries) of the Company.
"Swing Line Bank" means Comerica Bank and its successors and assignees
as provided in this Agreement.
"Swing Line Commitment" means, for the Swing Line Bank, its obligation
to make Swing Line Loans to the Floor Plan Borrowers up to the amount equal to
the greater of (i) $50,000,000, or (ii) in the sole determination of the Swing
Line Bank after five (5) Business Days' notice to the Agent, from time to time
an amount equal to $75,000,000, or such lesser amount (not less than
$50,000,000) as the Floor Plan Agent shall determine in its sole discretion;
provided that, subject to the provisions of Article IV, the Swing Line
Commitment is a part of the Floor Plan Loan Commitment rather than a separate,
independent commitment.
"Swing Line Loan" has the meaning specified in Section 4.1.
"Swing Line Minimum Amount" means the amount of Swing Line Loans which
in the mutual determination of the Borrowers and the Floor Plan Agent shall
remain outstanding as of each Floor Plan Adjustment Date, which amount may
change from time to time as the Borrowers and the Floor Plan Agent shall
mutually agree; provided, however, the Swing Line Minimum Amount shall in any
event not be in excess of Ten Million Dollars ($10,000,000).
"Swing Line Note" means the Swing Line Note substantially in the form
of Exhibit C-2, duly executed by all of the Floor Plan Borrowers and payable to
and delivered to the Swing Line Bank, in the principal face amount of the Swing
Line Commitment.
"Swing Line Overdraft Borrowing Request" has the meaning specified in
Section 2.3(g)(iii).
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"Swing Line Overdraft Loan" has the meaning specified in Section
2.3(g)(iii).
"Taxes" has the meaning specified in Section 5.14(a).
"Total Commitments" means, at any time, the aggregate amount of the
Commitments of all the Lenders, as in effect at such time.
"Total Leverage Ratio" means as of any date of determination, for the
Company, the quotient of (a) Adjusted Total Indebtedness as of such date divided
by (b) (y) Consolidated Pro Forma EBITDA as of such date, minus (z) Pro Forma
Floor Plan Interest Expense of the Company and its Subsidiaries, determined on a
consolidated basis and after having given effect to any proposed Acquisition, as
of such date.
"Transferee" has the meaning specified in Section 5.14(a).
"Type" means any type of Loan determined with respect to the interest
option applicable thereto, i.e., a Eurodollar Loan, an Alternate Base Rate Loan
or Comerica Prime Rate Loan.
"UCC" means the Uniform Commercial Code as adopted and in effect in the
State of Texas from time to time.
"Used Motor Vehicle" means a Motor Vehicle in the current or any of the
four preceding model years which is in readily saleable condition.
"Wholly-Owned Subsidiary" means any Person of which the Company or its
other Wholly-Owned Subsidiaries own directly or indirectly one hundred percent
(100%) of:
(a) the issued and outstanding shares of stock (except shares
required as directors' qualifying shares and shares constituting less than two
percent (2%) of the issued and outstanding shares);
(b) the capital interest or profits interest of such Person,
if it is a partnership, joint venture or similar entity; or
(c) the beneficial interest of such Person, if it is a trust,
association or other unincorporated organization.
SECTION I.2 Accounting Terms. Except as otherwise herein specifically
provided, each accounting term used herein shall have the meaning given it under
GAAP.
SECTION I.3 Interpretation.
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(a) In this Agreement, unless a clear contrary intention
appears:
(i) the singular number includes the plural number
and vice versa;
(ii) reference to any gender includes each other
gender;
(iii) the words "herein," "hereof" and "hereunder"
and other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other
subdivision;
(iv) reference to any Person includes such Person's
successors and assigns but, if applicable, only if such
successors and assigns are permitted by this Agreement, and
reference to a Person in a particular capacity excludes such
Person in any other capacity or individually, provided that
nothing in this clause (iv) is intended to authorize any
assignment not otherwise permitted by this Agreement;
(v) reference to any agreement (including this
Agreement), document or instrument means such agreement,
document or instrument as amended, supplemented or modified
and in effect from time to time in accordance with the terms
thereof and, if applicable, the terms hereof, and reference to
any Note includes any note issued pursuant hereto in extension
or renewal thereof and in substitution or replacement
therefor;
(vi) unless the context indicates otherwise,
reference to any Article, Section, Schedule or Exhibit means
such Article or Section hereof or such Schedule or Exhibit
hereto;
(vii) the word "including" (and with correlative
meaning "include") means including, without limiting the
generality of any description preceding such term;
(viii) with respect to the determination of any
period of time, the word "from" means "from and including" and
the word "to" means "to but excluding"; and
(ix) reference to any law means such law as amended,
modified, codified or reenacted, in whole or in part, and in
effect from time to time.
(b) The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
(c) No provision of this Agreement shall be interpreted or
construed against any Person solely because that Person or its legal
representative drafted such provision.
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ARTICLE II
THE FLOOR PLAN LOANS
SECTION II.1 Floor Plan Loan Commitments. Subject to the terms and
conditions and relying upon the representations and warranties of the Borrowers
herein set forth, each Lender severally and not jointly agrees, on the terms and
conditions set forth herein, to make revolving credit loans (each such loan, a
"Floor Plan Loan") to any Floor Plan Borrower from time to time on any Business
Day during the period from the Closing Date to the Maturity Date in an aggregate
amount not to exceed at any time outstanding such Lender's Floor Plan Loan
Commitment; provided, however, that after giving effect to all Floor Plan Loans
and Swing Line Loans requested on any date, the aggregate principal amount of
all outstanding Floor Plan Loans, all outstanding Swing Line Loans, all
outstanding Acquisition Loans, and all outstanding Letter of Credit Obligations
shall not at any time exceed the Total Commitment and subject to the other terms
and conditions hereof, any Floor Plan Borrower may borrow, prepay and reborrow
Floor Plan Loans under this Section 2.1.
SECTION II.2 Floor Plan Loans.
(a) Each Floor Plan Loan Borrowing made to any of the Floor
Plan Borrowers by the Lenders on the Closing Date or on any Floor Plan
Adjustment Date shall be in the minimum aggregate principal amount of One
Million Dollars ($1,000,000) and in integral multiples of One Million Dollars
($1,000,000); provided that a Comerica Prime Rate Loan or a Floor Plan Loan
resulting from a Draft may be in any amount and shall consist of Floor Plan
Loans of the same Type made ratably by the Lenders in accordance with their
respective Pro Rata Share of Floor Plan Loan Commitments; provided, however,
that the failure of any Lender to make any Floor Plan Loan shall not relieve any
other Lender of its obligation to lend hereunder.
(b) Each Floor Plan Loan Borrowing shall be a Comerica Prime
Rate Borrowing or a Eurodollar Borrowing as any of the Floor Plan Borrowers may
request pursuant to Section 2.3. Each Lender may fulfill its obligation to make
Floor Plan Loans with respect to any Eurodollar Loan by causing, at its option,
any domestic or foreign branch or Affiliate of such Lender to make such Loan,
provided that the exercise of such option shall not affect the obligation of the
applicable Floor Plan Borrower to repay such Loan in accordance with the terms
of the applicable Note.
(c) Not later than 10:00 A.M., HOUSTON, TEXAS TIME on the
Closing Date any one or more of the Floor Plan Borrowers shall deliver a Request
for Borrowing to the Floor Plan Agent. Not later than 11:00 A.M. HOUSTON, TEXAS
TIME of the same day, the Floor Plan Agent shall notify the Agent of the Type of
Borrowing requested and the aggregate amount of Floor Plan Loans being requested
by the Floor Plan Borrowers as of the Closing Date, less an amount equal to the
initial Swing Line Loan Minimum Amount. Upon receipt of such notice, the Agent
shall notify each Lender of the contents thereof and the amount of the Floor
Plan Loan required to be advanced by such Lender.
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(d) Each Lender shall, upon request from the Agent, from time
to time as herein provided, advance the amount required in connection with each
such Floor Plan Loan Borrowing by paying to the Agent in U.S. Dollars and in
immediately available funds on the same day not later than 3:00 P.M., HOUSTON,
TEXAS TIME, and, subject to satisfaction of the conditions set forth in Article
VIII, and the terms, provisions and conditions set forth in Section 2.3 and
Section 4.3, the Agent shall promptly and in any event on the same day, credit
the amounts so received to the account of the Floor Plan Agent, or, if a Floor
Plan Loan Borrowing shall not occur on such date because any condition precedent
herein specified shall not have been met, return the amounts so received to the
respective Lenders. Upon receipt of such funds the Floor Plan Agent shall
promptly and in any event on the same day, credit the amount so received to the
account of the applicable Borrower.
(e) Unless the Agent shall have received notice from a Lender
prior to the date of any such Floor Plan Loan Borrowing that such Lender will
not make available to the Agent such Lender's portion of such Borrowing, the
Agent may assume that such Lender has made such portion available to the Agent
on the date of such Floor Plan Loan Borrowing in accordance with this Section
2.2(e) and the Agent may, in reliance upon such assumption, make available to
the Floor Plan Agent on such date a corresponding amount. If, and to the extent
that such Lender shall not have made such portion available to the Agent, such
Lender and the applicable Floor Plan Borrowers severally agree to repay to the
Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the Floor
Plan Agent until the date such amount is repaid to the Agent (i) in the case of
the Floor Plan Borrowers, at the Applicable Interest Rate at the time to the
Loans comprising such Borrowing and (ii) in the case of such Lender, at the
Federal Funds Effective Rate. If such Lender shall repay to the Agent such
corresponding amount, such amount shall constitute such Lender's Loan as part of
such Borrowing for purposes of this Agreement.
(f) A Floor Plan Subsidiary shall not be entitled to request a
Floor Plan Borrowing hereunder until it (i) has executed and delivered to the
Lenders, as aforesaid, the Notes, and to the Swing Line Bank, a Swing Line Note,
(ii) has become a party to this Agreement by execution and delivery of an
Addendum, and (iii) has become a party to the Security Documents, accompanied in
each case by authority documents, legal opinions and other supporting documents
as required by Agent, Floor Plan Agent and the Required Lenders hereunder and
has otherwise complied with the provisions of Section 9.15.
SECTION II.3 Floor Plan Borrowing Procedure. Any Floor Plan Borrower
may request a Floor Plan Loan, (i) subject to Sections 2.8 through 2.12,
inclusive, in the case of a Draft by a Manufacturer, if such Draft is delivered
in accordance with the express terms of a Drafting Agreement and (ii) in the
case of Floor Plan Loans requested directly by a Floor Plan Borrower, only after
delivery to the Floor Plan Agent of a written Request for Borrowing executed by
a Person authorized by such Floor Plan Borrower to make such requests on behalf
of such Floor Plan Borrower. Floor Plan Loan Borrowings are subject to the
following and to the remaining provisions hereof:
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(a) each such Request for Borrowing shall set forth the
following information:
(i) the proposed date of such Borrowing, which
must be a Business Day;
(ii) the aggregate amount of such requested
Borrowing;
(iii) whether such Floor Plan Borrowing is to be
a Comerica Prime Rate Loan or a Eurodollar Loan, or in the
case of a Swing Line Loan, a Loan at the Quoted Rate
(provided, however, that all Drafts shall be deemed to be
requested at the Quoted Rate) and the Interest Period
applicable thereto;
(iv) a description of the Motor Vehicle(s)
purchased or to be purchased with the proceeds of such
Borrowing, including for each Motor Vehicle, its vehicle
identification number, make, model and purchase price, and
whether such Motor Vehicle is a new Motor Vehicle, Used Motor
Vehicle, Program Car or Demonstrator; and
(v) if requested by the Floor Plan Agent, in the
case of a Request for Borrowing requested directly by a Floor
Plan Borrower to fund the purchase of Used Motor Vehicles,
such Borrower shall deliver a current Manufacturer/Dealer
Statement with appropriate inventory breakout as required by
the Floor Plan Agent with the first such Request for Borrowing
in any month.
(b) each such Request for Borrowing shall be delivered to the
Floor Plan Agent (i) in the case of a Draft by a Manufacturer, by 11:00 A.M.,
HOUSTON, TEXAS TIME one (1) Business Day prior to the Borrowing Date of a
proposed Borrowing, (ii) in the case of a Eurodollar Borrowing, not later than
10:00 A.M., HOUSTON, TEXAS TIME, three (3) Days prior to the Borrowing Date of a
proposed Borrowing, and (iii) in the case of a Comerica Prime Rate Borrowing,
not later than 11:00 A.M., HOUSTON, TEXAS TIME on the Borrowing Date of a
proposed Borrowing;
(c) the aggregate principal amount of such Borrowing shall not
exceed the aggregate Floor Plan Advance Limit for the Motor Vehicles described
in such Request for Borrowing;
(d) subject to Section 2.3(g) hereof, the aggregate principal
amount of such requested Borrowing, plus the principal amount of all Floor Plan
Loans then outstanding plus the aggregate principal amount of all Swing Line
Loans then outstanding shall not exceed the Floor Plan Loan Commitment;
(e) the aggregate principal amount of such requested
Borrowing, plus the principal amount of all Floor Plan Loans then outstanding
hereunder plus the aggregate principal amount of all Swing Line Loans (but minus
the amount of any Swing Line Loans to be refunded with
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the proceeds of such Borrowing) then outstanding plus the aggregate principal
amount of all Acquisition Loans then outstanding plus all outstanding Letter of
Credit Obligations shall not exceed the Total Commitment;
(f) each Request for Borrowing shall be irrevocable and shall
constitute a certification as to itself by the applicable Floor Plan Borrower as
of the date thereof that:
(i) both before and after such Borrowing, the
obligations of the Company and its Subsidiaries under this
Agreement and the other Loan Documents to which it is a party,
as applicable, are valid, binding, and enforceable obligations
of such Person;
(ii) to the best knowledge of the Company and the
applicable Borrower, all conditions to such Borrowing have
been satisfied;
(iii) there is no Default or Event of Default in
existence, and none will exist upon the making of such Floor
Plan Loan;
(iv) the representations and warranties contained
in this Agreement and the other Loan Documents are true and
correct in all material respects and shall be true and correct
in all material aspects as of and immediately after the making
of such Floor Plan Loan; and
(v) such Borrowing will not violate the material
terms and conditions of any material contract, agreement or
other Borrowing of the Company and such applicable Borrower,
or any of its Subsidiaries.
(g) Notwithstanding the foregoing,
(i) if the Floor Plan Agent has, at the request
of the Required Lenders or acting in its discretion according
to the terms hereof, taken action to suspend or terminate
Drafts pursuant to one or more Drafting Agreements and such
Drafting Agreements have in fact been suspended or terminated
in accordance with their respective terms, then subject to the
terms of any such Drafting Agreements, the Floor Plan Agent
shall not fund the amount of such Draft; and
(ii) if on any day the requirements set forth in
Section 2.3(f) have been satisfied and the aggregate principal
amount of a Request for Borrowing of a Floor Plan Loan, plus
(A) the aggregate principal amount of all other Floor Plan
Loans then outstanding plus (B) the aggregate principal amount
of all Swing Line Loans (but minus the amount of any Swing
Line Loans to be refunded with the proceeds of such Borrowing)
then outstanding exceeds the aggregate principal amount of
such Loans outstanding as of the immediately preceding Floor
Plan Adjustment Date and is less than the Swing Line
Commitment, then such Request
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for Borrowing shall be deemed for all purposes a Request for
Borrowing of a Swing Line Loan and the Borrowing to be
disbursed in connection therewith shall constitute a Swing
Line Loan, and shall be disbursed in accordance with the
provisions of Article IV hereof; and
(iii) if on any day the requirements set forth in
Section 2.3(f) have been satisfied and the aggregate principal
amount of a Request for Borrowing of a Floor Plan Loan
consists of a Draft, the payment of which would cause (A) the
aggregate principal amount of all Floor Plan Loans then
outstanding, plus (B) the aggregate principal amount of all
Swing Line Loans (but minus the amount of any Swing Line Loan
to be refunded with the proceeds of such Borrowing) then
outstanding, plus (C) the aggregate principal amount of all
Requests for Borrowings of Floor Plan Loans outstanding as of
such day to exceed the Floor Plan Loan Commitment, as of such
day, and the Company fails to either immediately reduce any
pending Request for a Borrowing of a Floor Plan Loan which
does not consist of a Draft or make a payment of principal on
Floor Plan Loans and/or Swing Line Loans in an amount which
would prevent the aggregate amounts described in (A), (B) and
(C) above from exceeding such Floor Plan Loan Commitment,
then, in such event:
(1) the Company may request an
increase in the Floor Plan Loan Commitment
pursuant to Section 5.5(b), and such Request
for Borrowing shall be funded to the extent
of the increased Floor Plan Loan Commitment
(if any), or
(2) if the Company does not elect to
act under clause (1) above and if pursuant
to Section 3.4 there is a Reserve Commitment
available, then the Floor Plan Loan
Commitment shall be deemed to be irrevocably
increased by the amount of such Reserve
Commitment, and the Request for Borrowings
of Floor Plan Loans shall be funded to the
extent of the Floor Plan Loan Commitment as
increased by the Reserve Commitment, or
(3) if there is no Reserve
Commitment available, such Request for
Borrowing shall be deemed for all purposes a
Swing Line Overdraft Loan Borrowing Request
(each a "Swing Line Overdraft Borrowing
Request") and such Borrowing shall
constitute a Swing Line Overdraft Loan
(each, a "Swing Line Overdraft Loan") to be
disbursed and subject to the provisions of
Section 4.6.
(h) The Floor Plan Agent, acting on behalf of the Lenders,
may, at its option make Loans under this Article II upon the irrevocable
telephone request of a duly authorized officer of any Floor Plan Borrower and,
in the event the Floor Plan Agent, acting on behalf of the Lenders, makes any
such Loan upon a telephone request, the requesting officer of such Floor Plan
Borrower shall, if so requested by the Floor Plan Agent, deliver (including via
fax) to the Floor Plan Agent,
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on the same day as such telephone request, a written Request for Borrowing. Each
of the Floor Plan Borrowers hereby authorizes the Floor Plan Agent to disburse
Floor Plan Loans under this Section 2.3 pursuant to the telephone instructions
of any Person purporting to be a Person identified by name on a written list of
Persons authorized by each such Floor Plan Borrower to make a Request for
Borrowing for Floor Plan Loans on behalf of such Borrower(s). Notwithstanding
the foregoing, each of the Floor Plan Borrowers acknowledges and agrees that the
applicable Floor Plan Borrower shall bear all risk of loss resulting from
disbursements made upon any telephone request. Each Request for Floor Plan Loan
Borrowing made via telephone as hereunder provided shall constitute a
certification of the matters set forth in Section 2.3(f) of this Agreement;
(i) If at any time during an Adjustment Period the payment of
all of a Swing Line Loan would cause the outstanding balance of all Swing Line
Loans to be fully repaid, the Company may elect to cause such funds to be
invested in overnight funds or other securities held by Comerica Securities,
Inc. and acceptable to the Floor Plan Agent and the Lenders, which investments
shall be subject to the first priority security interest of the Floor Plan Agent
for the benefit of the Lenders to secure the outstanding balance of the
Obligations. The Floor Plan Agent and any of the Floor Plan Borrowers may enter
into an agreement from time to time to facilitate the investment of such funds.
SECTION II.4 Notice of Types of Floor Plan Loans and Interest Periods.
(a) On or before 10:00 A.M. HOUSTON, TEXAS TIME, three (3)
Business Days prior to each Floor Plan Adjustment Date, the Company shall
provide written (including via fax) Request for Borrowing to the Floor Plan
Agent designating the Type of Floor Plan Loans which will be outstanding
commencing on the Floor Plan Adjustment Date immediately following such notice
until the next succeeding Floor Plan Adjustment Date. If, for any reason, the
Company does not deliver the Request for Borrowing as herein provided,
including, without limitation providing for three (3) Business Days' notice, the
Company shall be deemed to have delivered the Request for Borrowing and
requested that on the Floor Plan Adjustment Date all Floor Plan Loans be
Comerica Prime Rate Borrowings.
(b) On or before 11:00 A.M. HOUSTON, TEXAS TIME on each Floor
Plan Adjustment Date, the Floor Plan Agent shall provide written (including via
fax) notice to the Agent of the amount of (i) Floor Plan Loans outstanding, plus
(ii) Swing Line Loans (plus Swing Line Overdraft Loans, if any) outstanding in
excess of the Swing Line Minimum Amount (if any), plus (iii) the amount of Floor
Plan Loans being requested pursuant to any Request for Borrowing of Floor Plan
Loans, as of 10:00 A.M., HOUSTON, TEXAS TIME on such date. Upon receipt of such
notice, the Agent shall provide prompt written (including via fax) notice to the
Lenders advising them (A) that the amount of Floor Plan Loans required pursuant
to (i), (ii) and (iii) above is greater than the amount required as of the
immediately preceding Floor Plan Adjustment Date and, with respect to each
Lender, the amount of additional Floor Plan Loans to be advanced by such Lender,
(B) that the amount of Floor Plan Loans required pursuant to (i), (ii) and (iii)
above, has decreased since the immediately preceding Floor Plan Adjustment Date
and, with respect to each Lender, the amount of such repayment to be made to
such Lender, or (C) that there is no change in the amount of Floor
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Plan Loans required pursuant to (i), (ii) and (iii) above since the immediately
preceding Floor Plan Adjustment Date. Such notice shall also advise the Lenders
of the Type of Floor Plan Loans the Floor Plan Borrowers have selected for the
period of time from the next Floor Plan Adjustment Date to the next succeeding
Floor Plan Adjustment Date.
(c) On each Floor Plan Adjustment Date (i) if Swing Line Loans
(plus Swing Line Overdraft Loans, if any) outstanding are greater than the Swing
Line Minimum Amount, the Swing Line Overdraft Loans shall be repaid and the
Swing Line Loans shall be reduced to the Swing Line Minimum Amount with proceeds
advanced by the Lenders pursuant to notices from the Floor Plan Agent given to
the Agent as provided in Section 2.2(e) hereof; in such event the Agent shall
remit the proceeds of such Floor Plan Loans to the Floor Plan Agent for
application to the Swing Line Loans (and to the Swing Line Overdraft Loans, if
any) outstanding in excess of the Swing Line Minimum Amount, or (ii) if Swing
Line Loans are less than the Swing Line Minimum Amount, the Swing Line Bank
shall make a Swing Line Loan to the Floor Plan Borrowers in an amount required
to cause the total amount of Swing Line Loans outstanding to equal the Swing
Line Minimum Amount; in such event the Floor Plan Agent shall remit the proceeds
of such Swing Line Loan to the Agent, and the Agent shall promptly remit such
proceeds to the Lenders.
SECTION II.5 Payments.
(a) Subject to the provisions of Section 2.3(i), each Floor
Plan Borrower shall, on the Curtailment Date of a Motor Vehicle, pay in full the
Floor Plan Advance Limit with respect to such Motor Vehicle.
(b) Subject to the provisions of Section 2.3(i), upon the sale
of any Motor Vehicle by a Floor Plan Borrower, such Floor Plan Borrower shall
pay in full the Floor Plan Advance Limit with respect to such Motor Vehicle (i)
with respect to Cash Receipted Motor Vehicles, immediately upon receipt of
payment, (ii) with respect to Sale Dated Motor Vehicles, within ten (10) days of
the date of such Motor Vehicle was sold and (iii) with respect to Fleet Motor
Vehicles, within thirty (30) days of the date of sale.
(c) Subject to the provisions of Section 2.3(i) and Section
4.6(c), payments required to be made by any Floor Plan Borrower as set forth in
Sections 2.5(a) and 2.5(b) shall be applied first to the outstanding principal
balance of Swing Line Overdraft Loans, next to the outstanding principal balance
of Swing Line Loans and then, only if no Swing Line Overdraft Loans or Swing
Line Loans are then outstanding, to the outstanding principal balance of Floor
Plan Loans.
(d) Each Floor Plan Borrower shall cause all proceeds from the
sale of Motor Vehicles to be deposited directly into an account of the
applicable Borrower with its local financial institution which proceeds shall be
transferred to the Excess/Payments in Process for payment of the Loans as
provided in Section 2.5(b).
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(e) An amount equal to two percent (2%) of the original
principal amount of Floor Plan Loans (or any portion thereof) attributable to
each Rental Motor Vehicle shall be payable on the fifteenth (15th) day of each
month after the date such Motor Vehicle is Deemed Floored.
SECTION II.6 Title Documents. All original Manufacturer's invoices and
title documents evidencing the Floor Plan Borrowers' ownership of all of their
Motor Vehicles, including, without limitation, the Manufacturer's Certificate,
shall be maintained in safekeeping by the Floor Plan Borrowers in a manner
acceptable to the Floor Plan Agent, unless and until an Event of Default has
occurred and is continuing, within three (3) Business Days of the request by the
Floor Plan Agent, the Floor Plan Borrowers shall deliver or cause to be
delivered all such original Manufacturer's invoices and title documents whether
at the time of such request or thereafter, to the Floor Plan Agent and the Floor
Plan Agent shall retain or hold all such original Manufacturer's invoices and
title documents received by the Floor Plan Agent after such request. Thereafter,
for so long as such Event of Default shall be continuing, all original
Manufacturer's Certificates and title documents shall remain in the Floor Plan
Agent's possession until the Floor Plan Loan Borrowing in connection therewith
or such ratable portion thereof in respect of a Motor Vehicle sold by any Floor
Plan Borrower in the ordinary course of business has been paid and performed in
full; provided that, upon the happening of an Event of Default and during the
continuance thereof, the Floor Plan Agent may transfer, as applicable, title
documents delivered to it pursuant to this Section 2.6 in connection with the
sale of Motor Vehicles in accordance with its rights provided for in this
Agreement or the other Loan Documents.
SECTION II.7 Power of Attorney. For the purpose of expediting the
financing of Motor Vehicles under the terms of this Agreement and for other
purposes relating to such financing transaction, each of the Floor Plan
Borrowers irrevocably constitutes and appoints the Floor Plan Agent and any of
its officers, and each of them, severally, as its true and lawful
attorneys-in-fact or attorney-in-fact with full authority to act on behalf of,
and in the name of, place, and stead of, each such Floor Plan Borrower,
regardless of whether or not an Event of Default shall have occurred hereunder,
to prepare, execute, and deliver any and all instruments, documents, and
agreements required to be executed and delivered by each such Floor Plan
Borrower necessary to evidence Floor Plan Loan Borrowings (and if outstanding,
Swing Line Overdraft Loans) hereunder and/or after the occurrence and during the
continuance of an Event of Default, to evidence, perfect, or realize upon the
security interest granted by this Agreement, and/or any of the Loan Documents,
including, without limitation, the Notes, requests for advances, security
agreements, financing statements, other instruments for the payment of money,
receipts, manufacturer's certificates of origin, certificates of origin,
certificates of title, applications for certificates of title, other basic
evidences of ownership, dealer reassignments of any of the foregoing,
affidavits, and acknowledgments. The foregoing power of attorney shall be
coupled with an interest, and shall be irrevocable so long as this Agreement
remains in effect, any Drafting Agreement remains in effect or any Obligations
(including Letter of Credit Obligations and Swing Line Overdraft Loans) remain
outstanding under this Agreement or any of the Notes. Each of said
attorneys-in-fact shall have the power to act hereunder with or without the
other. The Floor Plan Agent may, but shall not be obligated to, notify the Floor
Plan Borrowers of any such instruments or documents the Floor Plan Agent has
executed on any Borrower's behalf prior to such execution.
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SECTION 2.8 Issuance of Drafting Agreements. Subject to the terms and
conditions of this Agreement, Floor Plan Agent shall, at any time and from time
to time from and after the Closing Date until thirty (30) Business Days prior to
the Maturity Date, upon the written request of the Company or the applicable
Floor Plan Borrower, countersigned by the Company, accompanied by applications,
letter of credit agreements and/or such other documentation related thereto as
the Floor Plan Agent may require, issue Drafting Agreements for the account of
the applicable Floor Plan Borrower.
SECTION 2.9 Conditions to Issuance. The Floor Plan Agent shall not be
obligated to enter into or issue a Drafting Agreement unless, as of the date of
issuance of such Drafting Agreement:
(a) the Company or the applicable Floor Plan Borrower
requesting the Drafting Agreement shall have delivered to the Floor Plan Agent
not less than ten (10) Business Days prior to the requested date for issuance
(or such shorter time as the Floor Plan Agent in its sole discretion may
permit), a written application and such other documentation (including without
limitation a letter of credit agreement if the Drafting Agreement is to be
issued in the form of a letter of credit) and the terms of such documents and of
the proposed Drafting Agreement shall satisfy the terms hereof and otherwise be
satisfactory to Floor Plan Agent;
(b) the obligations of the Company and its Subsidiaries set
forth in this Agreement and the other Loan Documents to which each is a party
are valid, binding and enforceable obligations of such parties and the valid,
binding and enforceable nature of this Agreement and the other Loan Documents
has not been disputed by any of the Company or any of its Subsidiaries;
(c) the representations and warranties contained in this
Agreement or any other Loan Documents are true in all material respects as if
made on such date (unless limited to an earlier date), and both immediately
before and immediately after issuance of the Drafting Agreement so requested, no
Default or Event of Default has occurred and is continuing;
(d) No order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the Floor Plan
Agent from entering into or issuing such Drafting Agreement; no Requirement of
Law applicable to the Floor Plan Agent and no request or directive (whether or
not having the force of law) from any Governmental Authority with jurisdiction
over the Floor Plan Agent shall prohibit the Floor Plan Agent, or request that
the Floor Plan Agent refrain, from issuing or entering into Drafting Agreements
generally or such Drafting Agreement in particular or shall impose upon the
Floor Plan Agent with respect to such Drafting Agreement any restriction,
reserve or capital requirement (for which the Floor Plan Agent is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall impose upon
the Floor Plan Agent any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the Floor Plan Agent in good ▇▇▇▇▇
▇▇▇▇▇ material to it (relating to Drafts and Drafting Agreements); and
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(e) The Floor Plan Agent does not receive written notice from
any Lender, the Agent or any Floor Plan Borrower, on or prior to the Business
Day prior to the requested date of issuance or entry into such Drafting
Agreement that one or more of the applicable conditions contained in Article
VIII (or in this Section 2.9) has not been satisfied or that a Default or Event
of Default has occurred and is continuing.
Each application for a Drafting Agreement issued by a Borrower hereunder shall
constitute certification by each of the Company of the matters set forth in
subparagraphs (a) through (d) hereof, and Floor Plan Agent shall be entitled to
rely on such certification without any duty of inquiry. Immediately upon the
issuance or entering into by the Floor Plan Agent of each Drafting Agreement
(except in respect of any Drafting Agreement issued or entered into by the Floor
Plan Agent after it has obtained actual knowledge that an Event of Default has
occurred and is continuing), each Lender shall be deemed to, and subject to
Section 4.6 (relating to a Swing Line Overdraft Loan) hereby irrevocably and
unconditionally agrees to purchase from the Floor Plan Agent a participation in
such Drafting Agreement and each Draft thereunder in an amount equal to the
product of (i) the Pro Rata Share of Floor Plan Loan Commitments of such Lender
and (ii) the amount of each Draft presented by a Manufacturer.
Notwithstanding the foregoing, the Floor Plan Agent shall take such action as
necessary to terminate and suspend all Drafting Agreements effective ten days
prior to the Maturity Date then in effect.
SECTION 2.10 Notice of Issuance of or Entering into Manufacturers
Drafting Letters. The Floor Plan Agent shall give notice, substantially in the
form attached to this Agreement as Exhibit G, to each Lender of the issuance of
or entering into each Drafting Agreement not later than five (5) Business Days
after issuance of or entering into each such Drafting Agreement, attaching a
copy of such Drafting Agreement, as issued or entered into.
SECTION 2.11 Drafts Under Manufacturers Drafting Letters.
(a) In accordance with Sections 2.3, 4.3 and 4.6 hereof, each
Draft submitted by a Manufacturer pursuant to a Drafting Agreement shall
constitute a Request for Borrowing of a Floor Plan Loan, a Swing Line Loan, or a
Swing Line Overdraft Loan, as the case may be, and upon the funding of each
Draft presented by a Manufacturer under a Drafting Agreement, the Floor Plan
Agent shall be deemed to have disbursed or on behalf of the applicable Floor
Plan Borrower and the applicable Floor Plan Borrower shall be deemed to have
elected to substitute for its respective reimbursement obligations in respect of
such Draft, an advance of a Floor Plan Loan, a Swing Line Loan, or a Swing Line
Overdraft Loan, as the case may be, bearing interest at the Applicable Interest
Rate. Each of the Floor Plan Borrowers shall be irrevocably obligated to
reimburse Floor Plan Agent on demand for the amount of any Draft presented by a
Manufacturer under the terms of any Drafting Agreement; provided however that
such reimbursement obligation shall be deemed satisfied by the funding of a Loan
in respect thereto.
(b) Notwithstanding the obligation (if any) of the Floor Plan
Agent to fund a Draft drawn under a Drafting Agreement, (i) if at any time any
of the Floor Plan Borrowers has
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failed to satisfy the conditions precedent for the Floor Plan Agent to make a
Floor Plan Loan, or the Swing Line Bank to make a Swing Line Loan or a Swing
Line Overdraft Loan, (ii) if at any time the amount of such Draft would cause
the aggregate amount of Floor Plan Loans to exceed the Floor Plan Loan
Commitment, or (iii) after a Default or an Event of Default has occurred and is
continuing, then in any such event, the funding of such Draft shall not
constitute a waiver of any such condition, commitment, Default or Event of
Default or otherwise any manner whatsoever affect the rights, and remedies
available to the Floor Plan Agent, the Agent, the Swing Line Bank or any of the
Lenders hereunder. In any such event, the Floor Plan Borrowers shall remain
obligated to pay the amount of any Swing Line Overdraft Loan forthwith as set
forth herein and shall have all other duties and obligations applicable to the
Floor Plan Borrowers under this Agreement. Notwithstanding anything to the
contrary contained herein, each of the Floor Plan Borrowers shall bear all risk
of loss resulting from the payment of any Draft, or any resulting disbursements
of the Floor Plan Loans, Swing Line Loans or Swing Line Overdraft Loans, as the
case may be, whether or not due to the gross negligence, willful misconduct or
fraud of any Manufacturer.
(c) Subject to Section 4.6 hereof, each Lender shall be
obligated to fund Floor Plan Loans resulting from the presentation of Drafts by
Manufacturers under the Drafting Agreements, by making available their
respective Pro Rata Share of Floor Plan Loan Commitments of the amounts so
advanced, all in accordance with Section 2.2 hereof; provided, however, that if
for any reason the Floor Plan Agent is prohibited from making a Floor Plan Loan
in respect of any such Draft, each such Lender shall be deemed to and
unconditionally agrees to purchase from the Floor Plan Agent a participation
interest in the amount of such Draft (in the amount of its Pro Rata Share of
Floor Plan Loan Commitments), subject only to Section 4.6 hereof.
Notwithstanding the amount of the Floor Plan Loan Commitment in effect from time
to time, except with respect to the notices terminating or suspending drafting
privileges to be given pursuant Section 4.6(d) or Section 11.1 hereof or any
other notices given by the Floor Plan Agent in response to the written direction
of the Required Lenders, the Floor Plan Agent shall not be obligated to
terminate or suspend the drafting privileges of any Manufacturer under the
Drafting Agreements even though the aggregate amount of Drafts which may be
presented by Manufacturers under the Drafting Agreements may exceed the amount
of the Floor Plan Loan Commitment in effect from time to time. Furthermore, (i)
any limitations contained in any of the Drafting Agreements (whether in respect
of daily Drafts to be presented or otherwise) are for informational purposes
only and Floor Plan Agent shall not be obligated to monitor or limit the amount
of Drafts presented or honored on the basis of any such limitations and (ii) any
right of the Floor Plan Agent, acting in its discretion and not at the direction
or with the concurrence of the Required Lenders, to terminate or suspend
drafting privileges of any Manufacturer or otherwise exercise any right or
remedy shall be for the sole benefit and protection of the Floor Plan Agent, and
Floor Plan Agent shall not owe any duty to any of the other Lenders with respect
to such rights or remedies or be required to exercise such rights or remedies to
protect any of the other Lenders.
SECTION 2.12 Obligations Absolute. The Obligations of the Floor Plan
Borrowers under this Agreement and any of the other Loan Documents to reimburse
the Floor Plan Agent for Drafts presented by a Manufacturer under a Drafting
Agreement, and to repay any Swing Line Loans, the Floor Plan Loans or the Swing
Line Overdraft Loans, as the case may be, funded to pay a Draft shall be
unconditional and irrevocable, and shall be paid strictly in accordance with the
terms of this
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Agreement and each such other Loan Document under all circumstances, including
the following: (a) any lack of validity or enforceability of this Agreement or
any of the other Loan Documents; (b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Obligations of any
Borrower in respect of any Draft or any Drafting Agreement or any other
amendment or waiver of or any consent to departure from all or any of the
applicable/related Loan Documents; (c) the existence of any claim, set-off,
defense or other right that any Floor Plan Borrower may have at any time against
any Manufacturer or any other beneficiary or transferee of any Drafting
Agreement (or any Person for whom any such beneficiary or such transferee may be
acting), the Floor Plan Agent or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by the related Loan
Documents or any unrelated transaction other than the defense of payment or
claims arising out of the gross negligence, bad faith or willful misconduct of
the Floor Plan Agent or the Swing Line Bank; (d) any Draft, demand, certificate
or other document presented under a Drafting Agreement proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a Draft
under any Drafting Agreement; (e) any payment by the Floor Plan Agent under any
Drafting Agreement against presentation of a draft or certificate that does not
strictly comply with the terms of any Drafting Agreement; or any payment made by
the Floor Plan Agent under any Drafting Agreement to any trustee in bankruptcy,
debtor in possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of a successor to any beneficiary or any
transferee of any Drafting Agreement, including any arising in connection with
any Insolvency Proceeding; (f) any exchange, release or non-perfection of any
Collateral, or any release or amendment or waiver of or consent to departure
from all or any of the Obligations of any Borrower in respect of any Drafting
Agreement; or (g) any other circumstance that might otherwise constitute a
defense available to, or discharge of, any Borrower other than the defense of
payment or claims arising out of the gross negligence, bad faith or willful
misconduct of the Floor Plan Agent or the Swing Line Bank.
ARTICLE III
ACQUISITION LOANS
SECTION III.1 General. Subject to the terms and conditions and relying
upon the representations and warranties of the Company herein set forth, each
Lender severally and not jointly agrees on the terms and conditions set forth
herein to make revolving credit loans to the Company, (each such loan, an
"Acquisition Loan") from time to time on any Business Day during the period from
the Closing Date to the Maturity Date in an aggregate amount not to exceed at
any time outstanding such Lender's Pro Rata Share of the lesser of (a) the
Acquisition Loan Advance Limit, or (b) the aggregate amount of the Acquisition
Loan Commitments of all the Lenders; provided, however, that, after giving
effect to any Acquisition Loan Borrowing, the aggregate amount of all
outstanding Acquisition Loans, all outstanding Floor Plan Loans, all outstanding
Swing Line Loans and all outstanding Letter of Credit Obligations, shall not at
any time exceed the Total Commitment and subject to the other terms and
conditions hereof, the Company may borrow, prepay and reborrow Acquisition Loans
under this Section 3.1.
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SECTION III.2 Acquisition Loans.
(a) Each Acquisition Loan Borrowing made by the Lenders to the
Company on any Borrowing Date shall be in the minimum aggregate principal amount
of One Million Dollars ($1,000,000) (or the amount of a Letter of Credit
Borrowing or the remaining balance of the aggregate Acquisition Loan
Commitments, if less) and an integral multiple of One Million Dollars
($1,000,000) and shall consist of Acquisition Loans of the same Type made by the
Lenders in accordance with their respective Pro Rata Share of Acquisition Loan
Commitments; provided, however, that the failure of any Lender to make any
Acquisition Loan shall not relieve any other Lender of its obligation to lend
hereunder.
(b) Each Acquisition Loan Borrowing shall be an ABR Borrowing
or a Eurodollar Borrowing as the Company may request in a Request for Borrowing
delivered to the Agent in accordance with Section 3.3. Each Lender may fulfill
its Acquisition Loan Commitment with respect to any Eurodollar Loan by causing,
at its option, any domestic or foreign branch or Affiliate of such Lender to
make such Loan, provided that the exercise of such option shall not affect the
obligation of the Company to repay such Loan in accordance with the terms
hereof. Subject to the provisions of Section 3.3 and Section 5.9, Acquisition
Loan Borrowings of more than one Type may be outstanding at the same time.
(c) Each Lender shall make Acquisition Loans equal to its Pro
Rata Share of the Acquisition Loan Commitments by paying the amount required to
the Agent in Houston, Texas in U.S. Dollars and in immediately available funds
not later than 1:00 P.M., HOUSTON, TEXAS TIME, on the proposed Borrowing Date
and, subject to satisfaction of the conditions set forth in Article VIII, the
Agent shall promptly and in any event on the same day, credit the amounts so
received to the general deposit account of the Company, with the Agent, or such
other depository account as shall be designated by the Company or, if a
Borrowing shall not occur on such date because any condition precedent herein
specified shall not have been met, return the amounts so received to the
respective Lenders. Unless the Agent shall have received notice from a Lender
prior to the date of any Acquisition Loan Borrowing that such Lender will not
make available to the Agent such Lender's portion of such Acquisition Loan
Borrowing, the Agent may assume that such Lender has made such portion available
to the Agent on the date of such Acquisition Borrowing in accordance with this
Section 3.2 and the Agent may, in reliance upon such assumption, make available
to the Company on such date a corresponding amount. If, and to the extent that
such Lender shall not have made such portion available to the Agent, such Lender
and the Company jointly and severally agree to repay to the Agent forthwith on
demand such corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Company until the date such
amount is repaid to the Agent (i) in the case of the Company at the interest
rate applicable at the time to the Loans comprising such Borrowing and (ii) in
the case of such Lender, at the Federal Funds Effective Rate. If such Lender
shall repay to the Agent such corresponding amount, such amount shall constitute
such Lenders' portion of the Acquisition Loan as part of such Acquisition Loan
Borrowing for purposes of this Agreement.
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SECTION III.3 Notice of Acquisition Loan Borrowings.
(a) In order to obtain an Acquisition Loan, the Company shall
make an irrevocable written request therefor (or irrevocable telephone notice
thereof, confirmed as soon as practicable by written request) to the Agent, in
the form of a Request for Borrowing (i) in the case of an ABR Borrowing, not
later than 11:00 A.M., HOUSTON, TEXAS TIME, one (1) Business Day before the
Borrowing Date of a proposed Acquisition Loan Borrowing, and (ii) in the case of
a Eurodollar Borrowing, not later than 11:00 A.M., HOUSTON, TEXAS TIME, three
(3) Business Days before the Borrowing Date of a proposed Acquisition Loan
Borrowing. Each Request for Loan Borrowing shall be irrevocable and shall in
each case refer to this Agreement and specify (1) whether the Request for
Borrowing then being requested is to be an ABR Borrowing or a Eurodollar
Borrowing, (2) the Borrowing Date of such Acquisition Loan Borrowing (which
shall be a Business Day) and (3) the aggregate amount thereof (which shall not
be less than One Million Dollars ($1,000,000) or an integral multiple of One
Million Dollars ($1,000,000) in excess thereof), and (4) the Interest Period or
Interest Periods with respect thereto. If no election as to the Type of
Acquisition Loan Borrowing is specified in any such Request for Borrowing by the
Company, such Acquisition Loan Borrowing shall be an ABR Borrowing. If no
Interest Period with respect to any Borrowing is specified in any such Request
for Borrowing, the Company shall be deemed to have selected an Interest Period
of one (1) month's duration. The Agent shall promptly advise the Lenders of any
Request for Borrowing given by the Company pursuant to this Section 3.3 and of
each Lender's portion of the requested Acquisition Loan Borrowing.
(b) No more than eight (8) Acquisition Loans may be
outstanding at any time. For purposes of the foregoing, Borrowings comprised of
Acquisition Loans having different Interest Periods, regardless of whether they
commence on the same date, shall be considered separate Borrowings.
SECTION III.4 Reserve Commitment; Suspension of Acquisition Loans.
Notwithstanding the foregoing provisions of this Article III, in the event that
on any day the aggregate outstanding principal amount of all (a) Floor Plan
Loans, plus (b) Swing Line Loans, plus (c) Requests for Floor Plan Loan
Borrowings exceeds ninety-five percent (95%) of the Floor Plan Loan Commitment
as of such date, then (i) a portion of the Acquisition Loan Commitment (the
"Reserve Commitment") in an amount equal to the lesser of (y) Five Million
Dollars ($5,000,000) or (z) the entire remaining unused portion of the
Acquisition Loan Commitment as of such date, shall be reserved and shall no
longer be available for funding Acquisition Loans, and (ii) no further
Acquisition Loan Borrowings (after giving effect to the Reserve Commitment in
clause (i) hereof) shall be available to the Company until the next Business Day
on which such condition no longer exists.
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ARTICLE IV
SWING LINE LOANS
SECTION IV.1 Swing Line Commitments.
(a) The Swing Line Bank shall, on the terms and subject to the
conditions hereinafter set forth (including Section 4.3), make one or more
advances (each such advance being a "Swing Line Loan") to any Floor Plan
Borrower from time to time on any Business Day during the period from the
Closing Date to the Maturity Date in an aggregate principal amount not to exceed
at any time (not including Swing Line Overdraft Loans) the aggregate amount of
the Swing Line Commitment as such amount may change from time to time; and
(b) The Swing Line Bank may on the terms and subject to the
conditions hereinafter set forth (including Section 4.3) make one or more Swing
Line Loans to any Floor Plan Borrower from time to time on any Business Day
during the period from the Closing Date to the Maturity Date in an aggregate
principal amount greater than the Swing Line Commitment but not to exceed at any
time (not including Swing Line Overdraft Loans) the aggregate amount of the
Floor Plan Loan Commitments of all the Lenders; provided, however, that after
giving effect to all Borrowings of Swing Line Loans, Floor Plan Loans and all
Floor Plan Loans requested on any date, the sum of the aggregate principal
amount of all outstanding Floor Plan Loans and Swing Line Loans (but excluding
Swing Line Overdraft Loans) shall not exceed the aggregate amount of the then
applicable aggregate Floor Plan Loan Commitments. All Swing Line Loans
(including the Swing Line Overdraft Loans) shall be evidenced by the Swing Line
Note, under which advances, repayments and readvances may be made, subject to
the terms and conditions of this Agreement. Each Swing Line Loan shall mature
and the principal amount thereof shall be due and payable by the applicable
Floor Plan Borrower, as the case may be, on the last day of the Interest Period
applicable thereto. In no event whatsoever shall any outstanding Swing Line Loan
be deemed to reduce, modify or affect any Lender's obligation to make Floor Plan
Loans based upon its Pro Rata Share of Floor Plan Loan Commitments.
SECTION IV.2 Accrual of Interest; Margin Adjustments. Each Swing Line
Loan shall, from time to time after the date of such Loan, bear interest at its
Applicable Interest Rate. The amount and date of each Swing Line Loan, its
Applicable Interest Rate, its Interest Period, and the amount and date of any
repayment shall be noted on the Swing Line Bank's records, which records will be
conclusive evidence thereof, absent manifest error; provided, however, that any
failure by the Swing Line Bank to record any such information shall not affect
the obligations of the applicable Floor Plan Borrower with respect thereto in
accordance with the terms of this Agreement and the Loan Documents.
SECTION IV.3 Requests for Swing Line Loans.
(a) On the Closing Date, subject to the terms and conditions
hereunder set forth, the Swing Line Bank shall make a Swing Line Loan to one or
more of the Floor Plan Borrowers pursuant to a Request for Borrowing given by
such Floor Plan Borrowers in the manner specified in Section 4.3(b) and at the
Applicable Interest Rate in the aggregate amount of the Swing Line Minimum
Amount.
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(b) On any day that a Request for Borrowing constitutes a
Request for Borrowing of a Swing Line Loan pursuant to Section 2.3(g)(ii), the
applicable Floor Plan Borrower shall be deemed to have delivered to Swing Line
Bank a Request for Borrowing in connection therewith, subject to the following
and to the remaining provisions of this Section 4.3:
(i) the aggregate principal amount of such
requested Swing Line Loan Borrowing, plus the aggregate
principal amount of all other Swing Line Loans then
outstanding shall not exceed the Swing Line Commitment;
(ii) each such Request for Borrowing of a Swing
Line Loan once delivered to the Swing Line Bank, shall not be
revocable by the applicable Floor Plan Borrower, as the case
may be, and shall constitute and include a certification to
the extent applicable, by the Company of the provisions of
Section 2.3(f); and
(iii) the Swing Line Bank may, at its option,
make Swing Line Loans under this Section 4.3 upon the
irrevocable telephone request of a duly authorized officer of
any Floor Plan Borrower and, in the event the Swing Line Bank
makes any such Swing Line Loan upon a telephone request, the
requesting officer of such Floor Plan Borrower shall, if so
requested by the Swing Line Bank, deliver (including via fax)
to the Swing Line Bank on the same day as such telephone
request, a written Request for Borrowing of a Swing Line Loan.
Each of the Floor Plan Borrowers hereby authorizes the Swing
Line Bank to disburse Swing Line Loans pursuant to the
telephone instructions of any Person purporting to be a Person
identified by name on a written list of Persons authorized by
each such Floor Plan Borrower to make Requests for Borrowings
of Swing Line Loans on behalf of such Floor Plan Borrowers.
Notwithstanding the foregoing, each of the Floor Plan
Borrowers acknowledges and agrees that such Floor Plan
Borrower shall bear all risk of loss resulting from
disbursements made upon any telephone request. Each telephone
request for a Swing Line Loan Borrowing shall constitute a
certification of the matters set forth in Section 2.3(f) of
this Agreement.
SECTION IV.4 Disbursement of Swing Line Loans. Subject to receipt by
the Swing Line Bank of a Request for Borrowing of a Swing Line Loan by any Floor
Plan Borrower without exceptions noted in the compliance certifications in
connection therewith, and to the other terms and conditions of this Agreement,
the Swing Line Bank shall make available to any Floor Plan Borrower the amount
so requested, in same day funds, not later than 1:00 P.M., HOUSTON, TEXAS TIME
on the Borrowing Date of such Swing Line Loan, by credit to an account of the
applicable Floor Plan Borrower maintained with the Swing Line Bank or to such
other account or third party as such Floor Plan Borrower may reasonably direct.
The Swing Line Bank shall promptly notify the Floor Plan Agent of any Swing Line
Loan by telephone or telecopier.
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SECTION IV.5 Refunding of or Participation Interest in Swing Line
Loans.
(a) On any Floor Plan Adjustment Date the Swing Line Bank
shall, and upon the occurrence and during the continuance of an Event of
Default, the Swing Line Bank in its sole and absolute discretion, may:
on behalf of any Floor Plan Borrower (each of whom hereby irrevocably
directs the Swing Line Bank to act on its behalf) make a written
(including via fax) request to the Floor Plan Agent, requesting the
Lenders (including the Swing Line Bank in its capacity as a Lender) to
make Floor Plan Loans in an amount equal to the outstanding principal
amount of the Swing Line Loans in accordance with each Lender's
respective Pro Rata Share of Floor Plan Loan Commitments (including,
but only if an Event of Default shall have occurred and is continuing,
the portion thereof which constitutes the Swing Line Minimum Amount and
excluding Swing Line Overdraft Loans; provided that no such request
shall require any Lender to make Floor Plan Loans in excess of such
Lender's Floor Plan Loan Commitment) (the "Refunded Swing Line Loans")
on the date such request is made; provided however, unless an Event of
Default has occurred and is continuing, Refunded Swing Line Loans shall
not be subject to the indemnification provisions of Section 5.10, and
no losses, costs or expenses may be assessed by the Swing Line Bank
against the applicable Floor Plan Borrower or the other Lenders as a
consequence thereof. Unless an Event of Default described in Section
11.1(f) or 11.1(g) shall have occurred (in which event the procedures
of paragraph (b) of this Section 4.5 shall apply) and regardless of
whether the conditions precedent set forth in this Agreement to the
making of a Floor Plan Loan are then satisfied, each Lender shall upon
request by the Agent in the manner specified in Section 2.4 thereof
make the proceeds of its Floor Plan Loan available to the Floor Plan
Agent for the benefit of the Swing Line Bank.
(b) If, prior to the Lenders' making of Floor Plan Loans
pursuant to the provisions in paragraph (a) of this Section 4.5, an Event of
Default described in Section 11.1(f) or 11.1(g) shall have occurred, the Lenders
shall, in the manner provided in Section 2.11 (b) and (c), on the date such
Floor Plan Loan was to have been made, purchase from the Swing Line Bank, in
accordance with each Lender's respective Pro Rata Share of Floor Plan Loan
Commitments, participation interests in the Refunded Swing Line Loan; provided,
however, except for any Borrowing which occurs as a result of a Draft made prior
to the effective suspension or termination of the Drafting Agreement pursuant to
which such Borrowing occurred which Borrowing is subject to Section 2.11 hereof,
no Lender shall be obligated to purchase a participation interest in a Refunded
Swing Line Loan to the extent such Loan was made by the Swing Line Bank
notwithstanding the failure of the Floor Plan Borrower to which such Loan was
made to satisfy the requirements of Section 2.3(f).
(c) Each Lender's obligation to make Floor Plan Loans and to
purchase participation interests in accordance with Section 4.5(a) and Section
4.5(b) shall be absolute and unconditional and shall not be affected by any
circumstance, including, without limitation, (i) any setoff counterclaim,
recoupment, defense or other right which such Lender may have against the
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Swing Line Bank, any Floor Plan Borrower or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of any Default or Event of
Default; (iii) any adverse change in the condition (financial or otherwise) of
any Floor Plan Borrower or any other Person; (iv) any breach of this Agreement
by any Floor Plan Borrower or any other Person; (v) any inability of any Floor
Plan Borrower to satisfy the conditions precedent to a Borrowing set forth in
this Agreement on the date upon which such Floor Plan Loan is required to be
made or such participating interest is to be purchased; or (vi) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing. If any Lender does not make available to the Floor Plan Agent the
amount required pursuant to Section 4.5(a) or Section 4.5(b), as the case may
be, the Swing Line Bank shall be entitled to recover such amount on demand from
such Lender, together with interest thereon for each day from the date of
non-payment until such amount is paid in full at the Federal Funds Effective
Rate.
(d) Refunded Swing Line Loans which are funded by the Lenders
after two (2) Business Days notice as provided in subsection 4.5(a) shall
thereafter become Floor Plan Loans and subject to any right of acceleration
herein provided, shall remain outstanding until the next succeeding Floor Plan
Adjustment Date. Such Loans shall accrue interest in favor of the Lenders in
accordance with each Lender's respective Pro Rata Share of Floor Plan Loan
Commitments at the Comerica Prime-based Rate. On the next succeeding Floor Plan
Adjustment Date such Loans shall be treated as all other Floor Plan Loans
outstanding in accordance with the provisions of Section 2.4(b).
SECTION IV.6 Swing Line Overdraft Loans.
(a) On any day that a Request for Borrowing of a Floor Plan
Loan constitutes a Swing Line Overdraft Borrowing Request pursuant to Section
2.3(g)(iii), the applicable Floor Plan Borrower shall be deemed to have
delivered to the Swing Line Bank a Swing Line Overdraft Borrowing Request, and
each such Swing Line Overdraft Borrowing Request shall not be revocable by the
applicable Floor Plan Borrower, as the case may be, and shall constitute and
include a certification as to itself and its Subsidiaries, to the extent
applicable, by such Floor Plan Borrower of the provisions of Section 2.3(f).
(b) Each Swing Line Overdraft Loan shall bear interest at the
Applicable Interest Rate. The amount and date of each Swing Line Overdraft Loan,
the Applicable Interest Rate, the Interest Period, and the amounts and dates of
any repayment shall be noted on the Swing Line Bank's records, which records
will be conclusive evidence thereof, absent manifest error; provided however,
that any failure by the Swing Line Bank to record any such information shall not
affect the applicable Floor Plan Borrower's obligation under the terms of this
Agreement and the Loan Documents.
(c) Swing Line Overdraft Loans shall be made only by the Swing
Line Bank, solely for its own account and shall not be subject to the provisions
of Section 4.5; provided, however, at any time a Swing Line Overdraft Loan is
outstanding, the payment of principal and interest with respect to all Loans
shall be subordinated in right of payment and priority to the prior
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payment in full of the Swing Line Overdraft Loans and the Floor Plan Agent, the
Agent and the Lenders, as the case may be, shall remit to the Swing Line Bank,
and the Swing Line Bank shall have the right to receive, all payments of
principal and interest made by any Borrower in respect of any Loan and all other
proceeds of Collateral securing the Loans for application and reduction of the
aggregate principal amount of outstanding Swing Line Overdraft Loans.
(d) If at any time the aggregate outstanding principal amount
of all (i) Floor Plan Loans, plus (ii) Swing Line Loans, plus (iii) Swing Line
Overdraft Loans, plus (iv) Requests for Borrowings of Floor Plan Loans exceeds
(A) one hundred ten percent (110%) of the aggregate Floor Plan Loan Commitments
as of such date and such condition exists for two (2) consecutive Business Days
or (B) the aggregate Floor Plan Loan Commitments by any amount for any fifteen
(15) days out of any thirty (30) day period, then, in such event, the Floor Plan
Agent shall give prompt written notice to the Agent and the Agent shall give
prompt written notice to the Lenders and the Floor Plan Agent acting in its sole
discretion may, and upon the election of the Required Lenders shall (y) take any
and all actions reasonably necessary to suspend and/or terminate Drafts pursuant
to the Drafting Agreements and (z) elect by written notice to the Company to
terminate the Commitments and to deem such occurrence as constituting an Event
of Default.
ARTICLE V
ALL LOANS
SECTION V.1 Notes: Repayment of Loans.
(a) All Loans made hereunder shall be evidenced by the Notes
or the Swing Line Note, as the case may be, shall be payable as therein
provided, dated the Closing Date, and shall be in an aggregate principal amount
equal to the Total Commitments on such date. All Borrowers agree, jointly and
severally, to pay the outstanding principal balance of such Loans and all
interest thereon and all the obligations, as evidenced by the Notes, in
accordance with the terms and provisions of this Agreement and on the Maturity
Date. Each Note shall bear interest from its date on the outstanding principal
balance thereof as provided in Section 5.2.
(b) Each Lender, the Agent or the Floor Plan Agent and the
Swing Line Bank, on its behalf, and the Swing Line Bank shall, and is hereby
authorized by each Borrower to, endorse on the schedule attached to the Notes
delivered to each Lender (or a continuation of such schedule attached to such
Notes and made a part thereof), or otherwise record in such Lender's internal
records, an appropriate notation evidencing the date and amount of each Loan, as
well as the date and amount of each payment and prepayment with respect thereto;
provided, however, that the failure of any Lender, Agent or the Floor Plan
Agent, or the Swing Line Bank to make such a notation or any error in such a
notation shall not affect the obligations of all Borrowers hereunder or under
the Notes or the Swing Line Note.
SECTION V.2 Interest on Loans.
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(a) Subject to the provisions of Section 5.3, each Alternate
Base Rate Loan shall bear interest at a rate per annum, equal to the lesser of
(i) the Alternate Base Rate plus the Applicable Margin for ABR Loans and (ii)
the Highest Lawful Rate (if the Alternate Base Rate is based on the Prime Rate,
computed on the basis of the actual number of days elapsed over a year of 365 or
366 days, as the case may be; or if the Alternate Base Rate is based on the
Federal Funds Effective Rate, computed on the basis of the actual number of days
elapsed over a year of 360 days).
(b) Subject to the provisions of Section 5.3, each Comerica
Prime Rate Loan shall bear interest at a rate per annum (computed on the basis
of the actual number of days elapsed over a year of 360 days) equal to the
lesser of (i) the Comerica Prime-based Rate for the Interest Period in effect
for such Loan and (ii) the Highest Lawful Rate.
(c) Subject to the provisions of Section 5.3, (i) each
Eurodollar Loan which is an Acquisition Loan shall bear interest at a rate per
annum (computed on the basis of the actual number of days elapsed over a year of
360 days) equal to the lesser of (1) the LIBO Rate for the Interest Period in
effect for such Loan plus the Applicable Margin for Eurodollar Acquisition Loans
and (2) the Highest Lawful Rate; and (ii) each Eurodollar Loan which is a Floor
Plan Loan shall bear interest at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 360 days) equal to the lesser of
(1) the LIBO Rate for the Interest Period in effect for such Loan plus 1.25% and
(2) the Highest Lawful Rate.
(d) Interest on each Acquisition Loan and each Floor Plan Loan
shall be payable in arrears on each Interest Payment Date applicable to such
Loan except as otherwise provided in this Agreement. Interest on each Swing Line
Loan and Swing Line Overdraft Loan shall be payable in arrears on each Interest
Payment Date applicable to such Loan except as otherwise provided in this
Agreement. The applicable LIBO Rate, and the Alternate Base Rate shall be
determined by the Agent, and the Comerica Prime Rate shall be determined by the
Floor Plan Agent, and such determination shall be conclusive absent demonstrable
error. The Agent shall promptly advise the Borrowers and each Lender of each
such determination.
SECTION V.3 Interest on Overdue Amounts. If any Borrower shall default
in the payment of the principal of or interest on any Loan or any other amount
due hereunder, by acceleration or otherwise, such Borrower shall on demand from
time to time pay interest, to the extent permitted by law, on such defaulted
amount up to (but not including) the date of actual payment (after as well as
before judgment) at a rate per annum (computed on the basis of the actual number
of days elapsed over a period of 360 days) equal to the lesser of (a) the
Highest Lawful Rate and (b) the Alternate Base Rate plus two percent (2%) per
annum.
SECTION V.4 Fees.
(a) The Company shall pay each Lender, through the Agent, on
the last day of each March, June, September and December, and on the Maturity
Date, in immediately available funds, (i) a Floor Plan Loan Commitment fee (such
Lender's "Floor Plan Loan Commitment Fee") equal to twenty-five-one-hundredths
of one percent (0.25%) per annum times the average unused
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amount of the Floor Plan Loan Commitment of such Lender, during the immediately
preceding fiscal quarter (or shorter portion thereof) just ended; (ii) an
Acquisition Loan Commitment fee (such Lender's "Acquisition Loan Commitment
Fee") equal to thirty-seven and one-half one-hundredths of one percent (0.375%)
per annum times the average unused amount of the Acquisition Loan Commitment of
such Lender during the immediately preceding fiscal quarter (or shorter period
thereof) just ended; and (iii) subject to Section 13.8, at any time Acquisition
Loans are greater than sixteen and one-half percent (16.5%) of the Total
Commitments, a usage fee ("Usage Fee") equal to twelve and one-half
one-hundredths of one percent (0.125%) per annum times the outstanding principal
balance of Acquisition Loans owing to each such Lender (computed on the basis of
the actual number of days such condition exists). All Commitment Fees and Usage
Fees under this Section 5.4(a) shall be computed on the basis of the actual
number of days elapsed in a year of 365 or 366 days, as the case may be. The
Commitment of a Lender shall be deemed "unused" to the extent and in the amount
such Lender is obligated to fund future Loans or Letter of Credit Obligations of
any Borrower. All Usage Fees under this Section 5.4(a) shall be computed on the
basis of the actual Acquisition Loans outstanding during the applicable period.
The Floor Plan Loan Commitment Fees, the Acquisition Loan Commitment Fees, and
Usage Fees due to each Lender shall commence to accrue on the Closing Date and
cease to accrue on the earlier of the Maturity Date or the termination of the
Commitments of such Lender pursuant to Section 5.5 or 13.3 (b).
(b) The Company shall pay the Agent and Chase Securities Inc.
the fees (the "Agency Fees") in such amount and on such dates as may be agreed
between the Company, the Agent and Chase Securities Inc. pursuant to that
certain letter agreement dated September 10, 1999 herewith among the Company,
the Agent, and Chase Securities Inc. (the "Agent's Letter").
(c) The Company shall pay the Floor Plan Agent a Floor Plan
Agency Fee ("Floor Plan Agency Fee") in such amount on such dates as may be
agreed between the Company and the Floor Plan Agent (the "Floor Plan Agent's
Letter").
(d) The Company shall pay the Agent for the benefit of the
Lenders, according to their Pro Rata Share of Floor Plan Loan Commitments, a fee
in the amount of $750.00 for each day any Swing Line Overdraft Loan is
outstanding; and such amount (if any) shall be payable on the last Business Day
of each month.
(e) The Company shall pay to each of the Lenders on the
Closing Date the fees payable to each of the Lenders as provided in the Agent's
Letter.
SECTION V.5 Termination, Reduction or Conversion of Commitments.
(a) Subject to Section 3.4, upon at least three (3) Business
Days' prior written notice to the Agent, the Company may at any time, in whole,
permanently terminate, or from time to time, permanently reduce, the Total
Commitments, ratably among the Lenders in accordance with (i) their respective
Pro Rata Share of Floor Plan Loan Commitments, and (ii) their respective Pro
Rata Share of Acquisition Loan Commitments; provided, however, that (x) any such
partial
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reduction of the Total Commitments shall be in minimum aggregate increments of
Five Million Dollars ($5,000,000) and the Total Commitments may not be reduced
to less than an aggregate amount of One Hundred Million Dollars ($100,000,000)
unless the Total Commitments are terminated in whole; (y) any such partial
reduction shall be made ratably between the Floor Plan Loan Commitments and the
Acquisition Loan Commitments of each Lender, respectively, and (z) no reduction
shall reduce the amount of the Acquisition Loan Commitments to an amount which
is less than the Letter of Credit Obligations outstanding at such time; provided
further, the Floor Plan Agent in its sole discretion may, or at the direction of
the Required Lenders, shall suspend and/or terminate all or any portion of the
then outstanding Drafting Agreements.
(b) At any time there exists any unused portion of the
Acquisition Loan Commitments, the Company may request the Agent to convert such
unused portion of the Acquisition Loan Commitments to the Floor Plan Loan
Commitments and thereafter the Acquisition Loan Commitments shall be in an
aggregate amount equal to (i) the sum of all Acquisition Loans then outstanding,
plus (ii) all Letter of Credit Obligations then outstanding, plus (iii) the
remaining unused portion of the Acquisition Loan Commitments after subtracting
the amount thereof converted to the Floor Plan Loan Commitments; in such event,
the Floor Plan Loan Commitments shall, upon such request, be irrevocably
increased by the amount so requested by the Company, such amount together with
the Acquisition Loan Commitments not to exceed the Total Commitment. At any time
there exists any unused amount of a converted portion of the Floor Plan Loan
Commitments, the Company may request the Agent to reverse any such portion
thereof, in whole or in part, and in such event the Floor Plan Loan Commitments
and the Acquisition Loan Commitments shall be restored, as applicable, in the
respective amounts so requested by the Company.
(c) At the time the Commitments of any Lender are terminated
or reduced pursuant to Section 5.5, the Company shall pay to the Agent for the
account of each such Lender, the Floor Plan Loan Commitment Fees and the
Acquisition Loan Commitment Fees on the amount of the Commitments so terminated
or reduced owed through the date of such termination or reduction.
(d) Each of the Commitments shall automatically and
permanently terminate on the Maturity Date.
SECTION V.6 Alternate Rate of Interest. In the event, and on each
occasion, that on the day two (2) Business Days prior to the commencement of any
Interest Period for a Eurodollar Borrowing, the Agent shall have determined
(which determination shall be conclusive and binding upon the Borrowers) that:
(a) dollar deposits in the amount set forth in such request for Borrowing are
not generally available in the London interbank market, or that the rate at
which dollar deposits are being offered will not adequately and fairly reflect
the cost to any Lender or the Swing Line Bank of making or maintaining the
principal amount of its Eurodollar Loan comprising such Borrowing during such
Interest Period, or (b) reasonable means do not exist for ascertaining the LIBO
Rate, then the Agent shall as soon as practicable thereafter give written notice
of such determination to the Company, the Lenders and/or the Swing Line Bank;
and any request by a Borrower for the making of a Eurodollar Borrowing shall,
until the circumstances giving rise to such notice no longer exist,
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be deemed to be a request for a Borrowing to be comprised of (i) if such
Borrowing is a Floor Plan Loan Borrowing, Comerica Prime Rate Loans, and (ii) if
such Borrowing is an Acquisition Loan Borrowing, Alternate Base Rate Loans. Each
determination of the Agent hereunder shall be conclusive absent demonstrable
error.
SECTION V.7 Prepayment of Loans; Mandatory Reduction of Indebtedness.
(a) So long as no Swing Line Overdraft Loans are outstanding,
each Acquisition Loan Borrowing and each Floor Plan Loan Borrowing may be
prepaid at any time and from time to time, in whole or in part, subject to the
requirements of Section 5.10, but otherwise without premium or penalty, upon at
least thee (3) Business Days' prior written or telex notice to the Agent.
(b) On the date of any termination or reduction of the Total
Commitments pursuant to Section 5.5(a) or (e), each of the Borrowers shall
prepay so much of its Loans (up to the amount by which the Commitments are so
terminated or reduced) as shall be necessary in order that the aggregate
principal amount of the Loans and Letter of Credit Obligations outstanding will
not exceed the Total Commitments following such termination or reduction. All
prepayments under this paragraph shall be subject to Section 5.10.
(c) Each notice of prepayment shall specify the prepayment
date and the principal amount of each Loan (or portion thereof) to be prepaid,
which notice shall be irrevocable and shall commit the Borrower making such
notice to prepay such Loan by the amount stated therein on the date stated
therein. All prepayments shall be accompanied by accrued interest on the
principal amount being prepaid to the date of prepayment.
(d) Subject to the provisions of Section 2.3(g)(iii), if at
any time and for any reason:
(i) the aggregate principal amount of all (y)
Floor Plan Loans outstanding, plus (z) Swing Line Loans
outstanding shall exceed the amount of Floor Plan Loan
Commitment at such time, or
(ii) the aggregate principal amount of all (y)
Acquisition Loans, plus (z) Letter of Credit Obligation's
shall exceed the amount of the Acquisition Loan Commitment, or
(iii) the aggregate principal amount of all (w)
Floor Plan Loans outstanding, (x) Swing Line Loans
outstanding, plus (y) Acquisition Loans outstanding, plus (z)
Letter of Credit Obligations outstanding shall exceed the
Total Commitments,
the Borrowers shall immediately pay to the Agent (for application in the manner
directed by the Company) an amount of such Obligations equal to such excess,
provided, however, that Borrowers
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shall have the right to direct such repayment first to prepay such portion of
the Indebtedness not subject to the indemnification provisions of this Agreement
in Section 5.10.
SECTION V.8 Reserve Requirements; Change in Circumstances.
(a) It is understood that the cost to each Lender of making or
maintaining any of the Eurodollar Loans may fluctuate as a result of the
applicability of reserve requirements imposed by the Board at the ratios
provided for in Regulation D on the date hereof. The Borrowers agree to pay to
each of the Lenders from time to time such amounts as shall be necessary to
compensate such Lender for the portion of the cost of making or maintaining
Eurodollar Loans resulting from any increase in such reserve requirements
provided for in Regulation D from those as in effect on the date hereof, it
being understood that the rates of interest applicable to Eurodollar Loans have
been determined on the assumption that no such reserve requirements exist or
will exist and that such rates do not reflect costs imposed on the Lenders in
connection with such reserve requirements.
(b) Notwithstanding any other provision herein, if after the
date of this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender of
the principal of or interest on any Eurodollar Loan made by such Lender or any
other fees or amounts payable hereunder (other than taxes imposed on the overall
net income of such Lender by the jurisdiction in which such Lender has its
principal office or is located or by any political subdivision or taxing
authority therein), or shall impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, such Lender or shall impose on such
Lender or the London interbank market any other condition affecting this
Agreement or Eurodollar Loans made by such Lender and the result of any of the
foregoing shall be to increase the cost to such Lender of making or maintaining
any Eurodollar Loan or to reduce the amount of any sum received or receivable by
such Lender hereunder (whether of principal, interest or otherwise) in respect
thereof, by an amount deemed by such Lender in its sole discretion to be
material, then the Borrowers shall pay as required in Section 5.8(d) such
additional amount or amounts as will compensate such Lender for such additional
costs or reduction will be paid to such Lender with respect to the Eurodollar
Loans.
(c) If any Lender shall have determined that the applicability
of any law, rule, regulation or guideline adopted pursuant to or arising out of
the July 1988 report of the Basle Committee on Banking Regulations and
Supervisory Practices entitled "International Convergence of Capital Measurement
and Capital Standards," or the adoption after the date hereof of any other law,
rule, regulation or guideline regarding capital adequacy, or any change in any
of the foregoing or in the interpretation or administration of any of the
foregoing by any governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Lender (or any lending office of such Lender) or any Lender's holding company
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Lender's capital
or on the capital of such Lender's holding company, if any,
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as a consequence of this Agreement or the Loans made by such Lender pursuant
hereto to a level below that which such Lender or such Lender's holding company
could have achieved but for such adoption, change or compliance (taking into
consideration such Lender's policies and the policies of such Lender's holding
company with respect to capital adequacy) by an amount deemed by such Lender to
be material, then the Borrowers shall pay as required to Section 5.8(d) to such
Lender such additional amount or amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
(d) A certificate of each Lender setting forth in reasonable
detail calculations (together with the basis and assumptions therefor) to
establish such amount or amounts as shall be necessary to compensate such Lender
(or participating banks or other entities pursuant to Article XIII) as specified
in paragraph (a), (b) or (c) above shall be delivered to the Agent which shall
promptly deliver the same to the Company and such certificate shall be
rebuttably presumptive evidence of the amount or amounts which such Lender is
entitled to receive. The Borrowers shall pay such Lender the amount shown as due
on any such certificate within ten (10) days after its receipt of the same.
(e) Any demand for compensation pursuant to this Section 5.8
must be made on or before one (1) year after the Lender incurs the expense, cost
or economic loss referred to or such Lender shall be deemed to have waived the
right to such compensation. The protection of this Section 5.8 shall be
available to each Lender regardless of any possible contention of the invalidity
or inapplicability of any law, regulation or other condition which shall give
rise to any demand by such Lender for compensation.
(f) Nothing in this Section 5.8 shall entitle any Lender to
receive interest at a rate per annum in excess of the Highest Lawful Rate.
(g) The term "Lender" or "Lenders" as used in this Section 5.8
shall include the Swing Line Bank and the provisions hereof, when applicable,
shall apply to the Swing Line Bank.
SECTION V.9 Change in Legality.
(a) Notwithstanding anything to the contrary herein contained,
if any change in any law or regulation or in the interpretation thereof by any
Governmental Authority charged with the administration or interpretation thereof
shall make it unlawful for any Lender to make or maintain any Eurodollar Loan or
to give effect to its obligations in respect of any Eurodollar Borrowing
contemplated hereby, then, by written notice to the Agent, such Lender may:
(i) declare that Eurodollar Loans will not
thereafter be made by such Lender hereunder, whereupon any
request by any Borrower for a Eurodollar Borrowing shall, as
to such Lender only, be deemed a request for an Alternate Base
or the Comerica Prime Rate, as applicable, Rate Loan unless
such declaration shall be subsequently withdrawn; and
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(ii) require that all outstanding Eurodollar
Loans made by it be converted to Alternate Base Rate Loans, in
which event all such Eurodollar Loans shall be automatically
converted to Alternate Base Rate Loans if Acquisition Loans
and to Comerica Prime Rate Loans if Floor Plan Loans, as of
the effective date of such notice as provided in paragraph (b)
below.
In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal which would otherwise have been applied to
repay the Eurodollar Loans that would have been made by such Lender or the
converted Eurodollar Loans of such Lender shall instead be applied to repay the
Alternate Base Rate Loans if Acquisition Loans and to Comerica Prime Rate Loans
if Floor Plan Loans, made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Loans; provided, however, the Alternate Base Rate
Loans or Comerica Prime Rate Loans resulting from the conversion of such
Eurodollar Loans shall be prepayable only at the times the converted Eurodollar
Loans would have been prepayable, notwithstanding the provisions of Section
5.7(a).
(b) For purposes of Section 5.9(a), a notice to the Agent by
any Lender shall be effective as to each Eurodollar Loan, if lawful, on the last
day of the then-current Interest Period or, if there are then two (2) or more
current Interest Periods, on the last day of each such Interest Period,
respectively; otherwise, such notice shall be effective on the date of receipt
by the Agent.
(c) The term "Lender" or "Lenders" as used in this Section 5.9
shall include the Swing Line Bank and the provisions hereof, when applicable,
shall apply to the Swing Line Bank.
SECTION V.10 Indemnity.
(a) The Borrowers shall indemnify each Lender against any loss
or expense which such Lender may sustain or incur as a consequence of (i) any
failure by any Borrower to fulfill on the date of any Borrowing hereunder the
applicable conditions set forth in Article VIII, (ii) any failure by any
Borrower to borrow, convert or continue hereunder after delivery of a Request
for Borrowing or a notice of conversion or continuation has been given pursuant
to Sections 2.4, 3.3 and 5.15, (iii) any payment, prepayment or conversion of a
Eurodollar Loan required by any other provision of this Agreement or otherwise
made on a date other than the last day of the applicable Interest Period, (iv)
any default in payment or prepayment of the principal amount of any Loan or any
part thereof or interest accrued thereon, as and when due and payable (at the
due date thereof, by irrevocable notice of prepayment or otherwise), or (v) the
occurrence of any Event of Default, including, but not limited to, any loss or
reasonable expense sustained or incurred or to be sustained or incurred in
liquidating or employing deposits from third parties acquired to effect or
maintain such Loan or any part thereof as a Eurodollar Loan. Such loss or
reasonable expense shall include an amount equal to the excess, if any, as
reasonably determined by each Lender of (A) its cost of obtaining the funds for
the Loan being paid, prepaid or converted or not borrowed (based on the LIBO
Rate applicable thereto) for the period from the date of such payment,
prepayment or
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conversion or failure to borrow to the last day of the Interest Period for such
Loan (or, in the case of a failure to borrow, the Interest Period for such Loan
which would have commenced on the date of such failure to borrow) over (B) the
amount of interest (as reasonably determined by such Lender) that could be
realized by such Lender in reemploying during such period the funds so paid,
prepaid or converted or not borrowed. A certificate of each Lender setting forth
in reasonable detail calculations (together with the basis and assumptions
therefore) to establish any amount or amounts which such Lender is entitled to
receive pursuant to this Section 5.10 shall be delivered to the Agent which
shall promptly deliver the same to the Company and such certificate shall be
rebuttably presumptive evidence of the amount or amounts which such Lender is
entitled to receive. Nothing in this Section 5.10 shall entitle any Lender to
receive interest at a rate per annum in excess of the Highest Lawful Rate.
(b) The provisions of this Section 5.10 shall remain operative
and in full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any Note, or any investigation made by or on
behalf of any Lender; provided demand for compensation pursuant to Section 5.08
must be made on or before one (1) year after the Lender incurs the expense, cost
or economic loss referred to or such Lender shall be deemed to have waived the
right to such compensation. All amounts due under this Section 5.10 shall be
payable within ten (10) days after receipt of demand therefor.
(c) The term "Lender" or "Lenders" as used in this Section
5.10 shall include the Swing Line Bank and the provisions hereof, when
applicable, shall apply to the Swing Line Bank.
SECTION V.11 Pro Rata Treatment. Subject to Section 4.6(c) hereof, and
except as permitted under Section 5.8, each Borrowing, each payment or
prepayment of principal of the Notes, each payment of interest on such Notes,
each other reduction of the principal or interest outstanding under such Notes,
however achieved, each payment of the Commitment Fees and each reduction of the
Commitments shall be made, as applicable, in accordance with each Lender's
respective (i) Pro Rata Share of Floor Plan Loan Commitments, and (ii) Pro Rata
Share of Acquisition Loan Commitments.
SECTION V.12 Payments.
(a) The Company and/or any of the Borrowers shall make all
payments of principal and interest on any Swing Line Loan and any Swing Line
Overdraft Loan, any curtailment payment, and payments of the proceeds of the
sale of any Motor Vehicle to the Floor Plan Agent on the date when due in
dollars to the Floor Plan Agent at its offices in Detroit Michigan, and except
as otherwise provided in this Agreement, the Company and/or any of the Borrowers
shall make all payments (including principal of or interest on any Borrowing,
Agency Fee, or any other fees or other amounts) payable hereunder and under any
other Loan Document not later than 1:00 P.M., HOUSTON, TEXAS TIME, on the date
when due in dollars to the Agent at its offices at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, in immediately available funds, without setoff or counterclaim.
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(b) Subject to the provisos contained in subclauses (A) of the
definition of "Interest Period", whenever any payment (including principal of or
interest on any Borrowing or any fees or other amounts) hereunder or under any
other Loan Document shall become due, or otherwise would occur, on a day that is
not a Business Day, such payment may be made on the next succeeding Business
Day, and such extension of time shall in such case be included in the
computation of interest or fees, if applicable.
SECTION V.13 Sharing of Setoffs. Except as otherwise provided in
Section 4.6(c) in connection with the payment of Swing Line Overdraft Loans,
each Lender agrees that if it shall, in any manner, including through the
exercise of a right of banker's lien, setoff or counterclaim against any
Borrower, or pursuant to a secured claim under Section 506 of Title 11 of the
United States Code or other security or interest arising from, or in lieu of,
such secured claim, received by such Lender under any Insolvency Proceeding or
otherwise, obtain payment (voluntary or involuntary) in respect of the Note held
by it as a result of which the unpaid principal portion of the Note held by it
shall be proportionately less than the unpaid principal portion of the Note held
by any other Lender, it shall be deemed to have simultaneously purchased from
such other Lender a participation in the Note held by such other Lender, so that
the aggregate unpaid principal amount of the Note and participations in Notes
held by each Lender shall be in the same proportion to the aggregate unpaid
principal amount of all Notes then outstanding as the principal amount of the
Note held by it prior to such exercise of banker's lien, setoff or counterclaim
was to the principal amount of all Notes outstanding prior to such exercise of
banker's lien, setoff or counterclaim; provided, however, that if any such
purchase or purchases or adjustments shall be made pursuant to this Section 5.13
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or adjustments shall be rescinded to the extent of such recovery
and the purchase price or prices or adjustment restored without interest. The
Borrowers expressly consent to the foregoing arrangements and agree that any
Person holding a participation in a Note under this Section 5.13 deemed to have
been so purchased may exercise any and all rights of banker's lien, setoff or
counterclaim with respect to any and all moneys owing by any such Borrower to
such Lender as fully as if such Lender had made a Loan directly to such Borrower
in the amount of such participation.
SECTION V.14 Payments Free of Taxes.
(a) Any and all payments by the Borrowers hereunder shall be
made free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholdings, and all liabilities
with respect thereto, excluding taxes imposed on the Agent's, the Floor Plan
Agent's, the Swing Line Bank's or any Lender's or any transferee's or
assignee's, excluding a participation holder's (any such entity a "Transferee")
net income and franchise taxes imposed on the Agent, the Floor Plan Agent, the
Swing Line Bank or any Lender (or Transferee) by the United States or any
jurisdiction under the laws of which it is organized or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as "Taxes").
If the Borrowers shall be required by law to deduct any Taxes from or in respect
of any sum payable hereunder to the Lenders (or any Transferee), the Agent, the
Floor Plan Agent or the Swing Line Bank (i) the sum payable
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shall be increased by the amount necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 5.14) such Lender (or Transferee) or the Agent, the Floor Plan
Agent or the Swing Line Bank (as the case may be) shall receive an amount equal
to the sum it would have received had no such deductions been made, (ii) the
Borrowers shall make such deductions and (iii) the Borrowers shall pay the full
amount deducted to the relevant taxing authority or other governmental authority
in accordance with applicable law.
(b) In addition, the Borrowers agree to pay any present or
future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies which arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document which are not excluded under Section
5.14(a) (hereinafter referred to as "Other Taxes").
(c) The Borrowers will indemnify each Lender (or Transferee),
the Swing Line Bank, the Agent and/or the Floor Plan Agent for the full amount
of Taxes and Other Taxes (including any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 5.14) paid by such Lender (or
Transferee), the Swing Line Bank, the Agent and/or the Floor Plan Agent, as the
case may be, and any liability (including penalties, interest and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted by the relevant taxing authority or
other Governmental Authority. Such indemnification shall be made within thirty
(30) days after the date any such Person indemnified hereunder makes written
demand therefor, such demand to contain a certificate setting forth the
calculations (including all assumptions and the basis therefor) to establish the
amount for which indemnity is claimed. If a Lender (or Transferee), the Agent,
the Swing Line Bank, and/or the Floor Plan Agent shall become aware that it is
entitled to receive a refund in respect of Taxes or Other Taxes, it shall
promptly notify the Company of the availability of such refund and shall, within
thirty (30) days after receipt of a request by the Borrowers, apply for such
refund at the Company's expense. If any Lender (or Transferee), the Swing Line
Bank, the Agent and/or the Floor Plan Agent receives a refund in respect of any
Taxes or Other Taxes for which such Person has received payment from any of the
Borrowers, it shall promptly notify the Company of such refund and shall, within
thirty (30) days after receipt of a request by any of the Borrowers (or promptly
upon receipt, if any of the Borrowers has requested application for such refund
pursuant hereto), repay such refund to the Company, net of all out-of-pocket
expenses of such Person and without interest; provided that the Borrowers, upon
the request of such Person, agree to return such refund (plus penalties,
interest or other charges) to such Person in the event such Person is required
to repay such refund.
(d) Within thirty (30) days after the date of any payment of
Taxes or Other Taxes withheld by the Borrowers in respect of any payment to any
Lender (or Transferee) the Swing Line Bank, the Agent, and/or the Floor Plan
Agent, the Borrowers will furnish to such Person, at its address referred to in
Section 13.1, the original or a certified copy of a receipt evidencing payment
thereof to the extent available.
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(e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section 5.14
shall survive the payment in full of the principal of and interest on all Loans
made hereunder.
(f) The Agent, the Floor Plan Agent, each Lender, the Swing
Line Bank and each Transferee each represents that is either (i) a corporation
organized under the laws of the United States of America or any state thereof or
(ii) it is entitled to complete exemption from United States withholding tax
imposed on or with respect to any payments, including fees, to be made to it
pursuant to this Agreement (y) under an applicable provision of a tax convention
to which the United States of America is a party or (z) because it is acting
through a branch, agency or office in the United States of America and any
payment to be received by it hereunder is effectively connected with a trade or
business in the United States of America. Each Lender (or Transferee) which is
organized outside the United States shall, on the date it becomes a signatory
hereto, deliver to the Company such certificates, documents or other evidence,
as required by the Code or Treasury Regulations issued pursuant thereto,
including Internal Revenue Service Form W-8 BEN or Form W-8 ECI and any other
certificate or statement of exemption required by Treasury Regulation Section
1.1441-1(a) or Section 1.1441-6(c) or any subsequent version thereof, properly
completed and duly executed by such Lender (or Transferee) establishing such
payments to it are (i) not subject to withholding under the Code because such
payment is effectively connected with the conduct by such Lender (or Transferee)
of a trade or business in the United States or (ii) totally exempt from United
States tax under a provision of an applicable tax treaty. Unless the Company and
the Agent have received forms or other documents satisfactory to them indicating
that payments hereunder or under the Notes are not subject to United States
withholding tax or are subject to such tax at a rate reduced by an applicable
tax treaty, the Borrowers, the Agent, the Swing Line Bank and/or the Floor Plan
Agent shall withhold taxes from such payments at the applicable statutory rate
in the case of payments to or for any Lender (or Transferee) or assignee
organized under the laws of a jurisdiction outside the United States.
(g) The Borrowers shall not be required to pay any additional
amounts to any Lender (or Transferee) in respect of United States withholding
tax pursuant to paragraph (a) or (c) above if the obligation to pay such
additional amounts would not have arisen but for the failure of the
representation in Section 5.14(f) to be true or a failure by such Lender (or
Transferee) to comply with the provisions of paragraph (f) above unless such
failure results from (i) a change in applicable law, regulation or official
interpretation thereof or (ii) an amendment, modification or revocation of any
applicable tax treaty or a change in official position regarding the application
or interpretation thereof, in each case after the Closing Date (and, in the case
of a Transferee, after the date of assignment or transfer).
(h) Any Lender (or Transferee) claiming any additional amounts
payable pursuant to this Section 5.14 shall use reasonable efforts (consistent
with legal and regulatory restrictions) to file any certificate or document
requested by the Company or to change the jurisdiction of its Applicable Lending
Office if the making of such a filing or change would avoid the need for or
reduce the amount of any such additional amounts which may thereafter accrue and
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would not, in the sole determination of such Lender, be otherwise
disadvantageous to such Lender (or Transferee).
(i) If any Lender (or Transferee) requests compensation
pursuant to this Section 5.14, the Company may give notice to such Lender (with
a copy to the Agent) that they wish to seek one or more Eligible Assignees
(which may be one or more of the Lenders) to assume the Commitments of such
Lender and to purchase its outstanding Loans and Note. Each Lender (or
Transferee) requesting compensation pursuant to this Section 5.14 hereto agrees
to sell all of its Commitments, its Loans and its Note pursuant to Section 13.3
to any such Eligible Assignee for an amount equal to the sum of the outstanding
unpaid principal of and accrued interest on such Loans and Note plus all
Commitment Fees and other fees and amounts due such Lender (or Transferee)
hereunder calculated, in each case, to the date such Commitment, Loans and Note
are purchased, whereupon such Lender (or Transferee) shall thereafter have no
other Commitments or other obligation to the Floor Plan Borrowers hereunder or
under any Note.
SECTION V.15 Conversion and Continuation of Acquisition Loan Borrowings
and Floor Plan Borrowings.
(a) The Company shall have the right with respect to
Acquisition Loan Borrowings, on behalf of any Borrower, at any time upon prior
irrevocable notice to the Agent (x) not later than 10:00 A.M., HOUSTON, TEXAS
TIME, on the date of conversion, to convert any Eurodollar Borrowing into an ABR
Borrowing, (y) not later than 11:00 A.M., HOUSTON, TEXAS TIME, three Business
Days prior to conversion or continuation, to convert all or any portion of any
ABR Borrowing into a Eurodollar Borrowing or to continue all or any portion of
any Eurodollar Borrowing of any Borrower as a Eurodollar Borrowing for an
additional Interest Period, and (z) not later than 11:00 A.M., HOUSTON, TEXAS
TIME, three Business Days prior to conversion, to convert all or any portion of
the Interest Period with respect to any Eurodollar Borrowing to another
permissible Interest Period subject in each case to the following:
(i) each conversion or continuation shall be made
among the Lenders, in accordance (y) with each Lender's Pro Rata Share
of Acquisition Loan Commitments, and (z) with the respective principal
amounts of the Acquisition Loans comprising the converted or continued
Acquisition Loan Borrowing;
(ii) if less than all the outstanding principal
amount of any such Acquisition Loan Borrowing shall be converted or
continued, the aggregate principal amount of such Acquisition Loan
Borrowing converted or continued shall be an integral multiple of One
Million Dollars ($1,000,000) and not less than One Million Dollars
($1,000,000);
(iii) if any Eurodollar Borrowing is converted at a
time other than the end of the Interest Period applicable thereto, the
Company shall pay, upon demand, any amounts due, if any, to the Lenders
under Section 5.10;
(iv) any portion of a Borrowing maturing or required
to be repaid in less than one month may not be converted into or
continued as a Eurodollar Borrowing;
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(v) any portion of a Eurodollar Borrowing which
cannot be converted into or continued as a Eurodollar Borrowing by
reason of clause (iv) above shall be automatically converted at the end
of the Interest Period in effect for such Acquisition Loan Borrowing
into an ABR Borrowing;
(vi) no Interest Period may be selected for any
Eurodollar Borrowing that would end later than the Maturity Date; and
(vii) accrued interest on an Acquisition Loan (or
portion thereof) being converted or continued shall be paid by the
Company at the time of conversion or continuation.
Each notice pursuant to this Section 5.15(a) shall be irrevocable and
shall refer to this Agreement and specify (w) the identity and amount of the
Acquisition Loan Borrowing that the Company requests to be converted or
continued, (x) whether such Acquisition Loan Borrowing is to be converted to or
continued as a Eurodollar Borrowing or an ABR Borrowing, (y) if such notice
requests a conversion, the date of such conversion (which shall be a Business
Day) and (z) if such Acquisition Loan Borrowing is to be converted to or
continued as a Eurodollar Borrowing, the Interest Period with respect thereto.
If no Interest Period is specified in any such notice with respect to any
conversion to or continuation as a Eurodollar Borrowing, the Company shall be
deemed to have selected an Interest Period of one (1) month's duration. The
Agent shall promptly advise the other Lenders of any notice given pursuant to
this Section 5.15(a) and of each Lender's portion of any converted or continued
Borrowing. If the Company shall not have given written notice in accordance with
this Section 5.15(a) to continue any Eurodollar Borrowing into a subsequent
Interest Period (and shall not otherwise have given written notice in accordance
with this Section 5.15(a) to convert such Acquisition Loan Borrowing), such
Acquisition Loan Borrowing shall, at the end of the Interest Period applicable
thereto (unless repaid pursuant to the terms hereof), automatically be converted
into as an ABR Borrowing.
(b) The Company shall have the right with respect to Floor
Plan Loan Borrowings, on behalf of any Floor Plan Borrower, at any time upon
prior irrevocable notice to the Agent (x) not later than 10:00 A.M., HOUSTON,
TEXAS TIME, on the date of conversion, to convert any Eurodollar Borrowing into
a Comerica Prime Rate Borrowing, (y) not later than 11:00 A.M., HOUSTON, TEXAS
TIME, three Business Days prior to conversion or continuation, to convert all or
any portion of any Comerica Prime Rate Borrowing into a Eurodollar Borrowing or
to continue all or any portion of any Eurodollar Borrowing of any Floor Plan
Borrower as a Eurodollar Borrowing for an additional Interest Period, and (z)
not later than 11:00 A.M., HOUSTON, TEXAS TIME, three Business Days prior to
conversion, to convert all or any portion of the Interest Period with respect to
any Eurodollar Borrowing to another permissible Interest Period subject in each
case to the following:
(i) each conversion or continuation shall be made
pro rata among the Lenders, in accordance (y) with each Lender's Pro
Rata Share of Floor Plan Loan
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Commitments, and (z) with the respective principal amounts of the Floor
Plan Loans comprising the converted or continued Floor Plan Loan
Borrowing;
(ii) if less than all the outstanding principal
amount of any such Floor Plan Loan Borrowing shall be converted or
continued, the aggregate principal amount of such Floor Plan Loan
Borrowing converted or continued shall be an integral multiple of One
Million Dollars ($1,000,000) and not less than One Million Dollars
($1,000,000);
(iii) if any Eurodollar Borrowing is converted at a
time other than the end of the Interest Period applicable thereto, the
Company shall pay, upon demand, any amounts due, if any, to the Lenders
under Section 5.10;
(iv) any portion of a Borrowing maturing or required
to be repaid in less than one month may not be converted into or
continued as a Eurodollar Borrowing;
(v) any portion of a Eurodollar Borrowing which
cannot be converted into or continued as a Eurodollar Borrowing by
reason of clause (iv) above shall be automatically converted at the end
of the Interest Period in effect for such Floor Plan Loan Borrowing
into a Comerica Prime Rate Borrowing;
(vi) no Interest Period may be selected for any
Eurodollar Borrowing that would end later than the Maturity Date; and
(vii) accrued interest on an Floor Plan Loan (or
portion thereof) being converted or continued shall be paid by the
Company at the time of conversion or continuation.
Each notice pursuant to this Section 5.15(b) shall be irrevocable and
shall refer to this Agreement and specify (w) the identity and amount of the
Floor Plan Loan Borrowing that the Company requests to be converted or
continued, (x) whether such Floor Plan Loan Borrowing is to be converted to or
continued as a Eurodollar Borrowing or a Comerica Prime Rate Borrowing, (y) if
such notice requests a conversion, the date of such conversion (which shall be a
Business Day) and (z) if such Floor Plan Loan Borrowing is to be converted to or
continued as a Eurodollar Borrowing, the Interest Period with respect thereto.
If no Interest Period is specified in any such notice with respect to any
conversion to or continuation as a Eurodollar Borrowing, the Company shall be
deemed to have selected an Interest Period of one (1) month's duration. The
Agent shall promptly advise the other Lenders of any notice given pursuant to
this Section 5.15(b) and of each Lender's portion of any converted or continued
Borrowing. If the Company shall not have given written notice in accordance with
this Section 5.15(b) to continue any Eurodollar Borrowing into a subsequent
Interest Period (and shall not otherwise have given written notice in accordance
with this Section 5.15(b) to convert such Floor Plan Loan Borrowing), such Floor
Plan Loan Borrowing shall, at the end of the Interest Period applicable thereto
(unless repaid pursuant to the terms hereof), automatically be converted into a
Comerica Prime Rate Borrowing.
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SECTION 5.16 Extension of Maturity Date.
(a) Provided that no Default or Event of Default has occurred
and is continuing, the Company may, by written notice to Agent (with sufficient
copies for each Lender) (which notice shall be irrevocable and which shall not
be deemed effective unless actually received by Agent) prior to November 1, but
not before October 1, of each fiscal year, request that the Lenders extend the
then applicable Maturity Date to a date that is one year later than the Maturity
Date, then in effect (each such request, a "Request"). Each Lender shall, not
later than November 30th of such fiscal year, give written notice to the Agent
stating whether such Lender is willing to extend the Maturity Date as requested.
If Agent has received the aforesaid written approvals of such Request from each
of the Lenders, then, effective upon the date of Agent's receipt of all such
written approvals from the Lenders, as aforesaid, the Maturity Date shall be so
extended for an additional one year period, the term Maturity Date shall mean
such extended date and Agent shall promptly notify the Company that such
extension has occurred.
(b) If (i) any Lender gives the Agent written notice that it
is unwilling to extend the Maturity Date as requested or (ii) any Lender fails
to provide written approval to Agent of such a Request on or before November 30
of such fiscal year, then, (w) the Lenders shall be deemed to have declined to
extend the Maturity Date, (x) the then-current Maturity Date shall remain in
effect (with no further right on the part of the Company to request extensions
thereof under this Section 2.9), and (y) the Floor Plan Loan Commitments and the
Acquisition Loan Commitments of each of the Lenders shall terminate on the
Maturity Date then in effect, the Floor Plan Agent shall take such action as
necessary to terminate and suspend all Drafting Agreements effective ten (10)
days prior to the Maturity Date then in effect, and Agent shall promptly notify
Company thereof.
ARTICLE VI
LETTERS OF CREDIT
SECTION VI.1 General.
(a) On the terms and conditions set forth herein (i) the
Issuing Bank agrees from time to time on any Business Day during the period from
the Closing Date to the last Business Day thirty (30) days prior to the Maturity
Date (the "Letter of Credit Termination Date") to issue Letters of Credit for
the account of any Borrower, and to amend or renew Letters of Credit previously
issued by it, in accordance with Section 6.2; and (ii) the Lenders severally
agree to participate in Letters of Credit Issued for the account of the
Borrowers; provided, that the Issuing Bank shall not be obligated to Issue, and
no Lender shall be obligated to participate in, any Letter of Credit if, as of
the date of request of such Letter of Credit, after giving effect to the maximum
amount payable under such Letter of Credit, (y) the aggregate principal amount
of all Letter of Credit Obligations outstanding shall at any time exceed Fifteen
Million Dollars ($15,000,000) or (z) the aggregate principal amount of
Acquisition Loans outstanding plus the Letter of Credit Obligations outstanding
as of such day shall exceed the Acquisition Loan Commitments of all the Lenders;
further, the aggregate principal amount of all Letter of Credit Obligations
outstanding, plus the aggregate
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principal amount of all Acquisition Loans outstanding, plus the aggregate
principal amount of all Swing Line Loans outstanding plus the aggregate
principal amount of all Floor Plan Loans outstanding shall not at any time
exceed the Total Commitments. Within the foregoing limits, and subject to the
other terms and conditions hereof, the ability of the Borrowers to obtain
Letters of Credit shall be fully revolving, and, accordingly, the Borrowers may,
during the foregoing period, obtain Letters of Credit to replace Letters of
Credit which have expired or which have been drawn upon and reimbursed.
(b) The Issuing Bank is under no obligation to Issue any
Letter of Credit if: (i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the
Issuing Bank from Issuing such Letter of Credit, or any Requirement of Law
applicable to the Issuing Bank or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction over
the Issuing Bank shall prohibit Issuing Bank, or request that the Issuing Bank
refrain, from the Issuance of Letters of Credit generally or such Letter of
Credit in particular or shall impose upon the Issuing Bank with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the
Issuing Bank is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost
or expense which was not applicable on the Closing Date and which the Issuing
Bank in good ▇▇▇▇▇ ▇▇▇▇▇ material to it; (ii) the Issuing Bank has received
written notice from any Lender, the Agent or any Borrower, on or prior to the
Business Day prior to the requested date of Issuance of such Letter of Credit,
that one or more of the applicable conditions contained in Article VIII is not
then satisfied; (iii) the expiration date of any requested Letter of Credit is
more than one (1) year from the date of Issuance thereof or after the Maturity
Date; (iv) any requested Letter of Credit does not provide for drafts, or is not
otherwise in form and substance acceptable to the Issuing Bank, or the Issuance
of a Letter of Credit shall violate any applicable policies of the Issuing Bank,
or the Issuance of a Letter of Credit is for an amount less than One Hundred
Thousand Dollars ($100,000) or to be denominated in a currency other than U.S.
Dollars.
SECTION VI.2 Issuance, Amendment and Renewal of Letters of Credit.
(a) Each Letter of Credit shall be issued upon the irrevocable
written request of the Company received by the Issuing Bank (with a copy sent by
the Company to the Agent) at least three (3) days (or such shorter time as the
Issuing Bank may agree in a particular instance in its sole discretion) prior to
the proposed date of Issuance. Each such request for Issuance of a Letter of
Credit shall be by facsimile, confirmed immediately in an original writing, in
the form of a Letter of Credit Application, and shall specify in form and detail
satisfactory to the Issuing Bank such matters as the Issuing Bank may require.
Each Letter of Credit (i) will be for the account of such Borrower, (ii) will be
a (A) nontransferable standby letter of credit to support certain performance
obligations of such Borrower, or (B) non-transferable standby letter of credit
to support certain payment obligations of such Borrower that are not prohibited
by this Agreement, (iii) will be for purposes reasonably satisfactory to the
Issuing Bank and (iv) will contain such terms and provisions as may be
customarily required by the Issuing Bank.
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(b) Prior to the Issuance of any Letter of Credit, the Issuing
Bank will confirm with the Agent (by telephone or in writing) that the Agent has
received a copy of the Letter of Credit Application or Letter of Credit
Amendment Application from any Borrower and, if not, the Issuing Bank will
provide the Agent with a copy thereof. Unless the Issuing Bank has received
notice prior to its Issuance of a requested Letter of Credit from the Agent (i)
directing the Issuing Bank not to Issue such Letter of Credit because such
Issuance is not then permitted under this Section 6.2, or (ii) that one or more
conditions specified in Article VIII are not then satisfied or waived; then,
subject to the terms and conditions hereof, the Issuing Bank shall, on the
requested date, Issue a Letter of Credit for the account of such Borrower in
accordance with the Issuing Bank's usual and customary business practices.
(c) From time to time while a Letter of Credit is outstanding
and prior to the Letter of Credit Termination Date, the Issuing Bank will, upon
the written request of any Borrower received by the Issuing Bank (with a copy
sent by the Borrower to the Agent) at least three (3) days (or such shorter time
as the Issuing Bank may agree in particular instance in its sole discretion)
prior to the proposed date of amendment or extension, amend any Letter of Credit
Issued by it or extend the expiry date. Each such request for amendment or
extension of a Letter of Credit shall be made by facsimile, confirmed
immediately in an original writing, made in such form as the Issuing Bank shall
require. The Issuing Bank shall be under no obligation to amend or extend the
expiry date any Letter of Credit if: (i) the Issuing Bank would have no
obligation at such time to Issue such Letter of Credit in its amended form under
the terms of this Agreement; or (ii) the beneficiary of any such Letter of
Credit does not accept the proposed amendment to the Letter of Credit.
(d) Upon receipt of notice from the Issuing Bank, the Agent
will promptly notify the Lenders of the Issuance of a Letter of Credit and any
amendment or extension thereto.
(e) If any outstanding Letter of Credit shall provide that it
shall be automatically renewed unless the beneficiary thereof receives notice
from the Issuing Bank that such Letter of Credit shall not be renewed, the
Issuing Bank shall be permitted to allow such Letter of Credit to renew, and the
Borrowers and the Lenders hereby authorize such renewal. The Issuing Bank shall
not be obligated to allow such Letter of Credit to renew if the Issuing Bank
would have no obligation at such time to Issue or amend such Letter of Credit
under the terms of this Agreement.
(f) The Issuing Bank may, at its election (or as required by
the Agent at the direction of the Required Lenders), deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any time
and from time to time, in order to cause the expiration date of any Letter of
Credit to be a date not later than the Maturity Date.
(g) This Agreement shall control in the event of any conflict
with any Letter of Credit-Related Document.
(h) The Issuing Bank will also deliver to the Agent,
concurrently or promptly following its delivery of a Letter of Credit, or
amendment or extension to a Letter of Credit, to an
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advising bank or a beneficiary, a true and complete copy of each such Letter of
Credit, amendment, or extension to a Letter of Credit.
SECTION VI.3 Risk Participations, Drawings and Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit,
the Lenders shall be deemed to, and hereby irrevocably and unconditionally agree
to, purchase from the Issuing Bank participation interests in such Letters of
Credit and each drawing thereunder, ratably in amounts equal to the product of
(i) each such Lender's Pro Rata Share of Acquisition Loan Commitments, and (ii)
the maximum amount available to be drawn under such Letter of Credit and the
amount of such drawing respectively. Each Issuance of a Letter of Credit shall
be deemed to utilize the Acquisition Loan Commitment of each Lender by an amount
equal to the amount of such participation.
(b) In the event of any request for a drawing under a Letter
of Credit by the beneficiary or transferee thereof, the Issuing Bank will
promptly notify the Company. In the case of Letters of Credit under which
drawings are payable one or more Business Days after the drawing is made, the
Issuing Bank will give such notice to the Company at least one Business Day
prior to the Honor Date. The Company shall reimburse the Issuing Bank prior to
11:00 A.M., HOUSTON, TEXAS TIME, on each date that any amount is paid by the
Issuing Bank under any Letter of Credit (each such date, an "Honor Date") in an
amount equal to the amount so paid by the Issuing Bank. In the event the Company
fails to reimburse the Issuing Bank for the full amount of any drawing under any
Letter of Credit by 11:00 A.M., HOUSTON, TEXAS TIME, on the Honor Date, the
Issuing Bank will promptly notify the Agent and the Agent will promptly notify
each Lender thereof, and the Company shall be deemed to have requested an
Alternate Base Rate Loan be made by the Lenders to be disbursed on the Honor
Date under such Letter of Credit, subject to the amount of the unutilized
portion of the Acquisition Loan Commitment and subject to the conditions set
forth in Article VIII. Any notice given by the Issuing Bank or the Agent
pursuant to this Section 6.3(b) may be oral if immediately confirmed in writing
(including by facsimile); provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.
(c) The Lenders shall, in accordance with their respective Pro
Rata Share of Acquisition Loan Commitments, upon any notice pursuant to Section
6.3(b) make available to the Agent for the account of the Issuing Bank an amount
in Dollars and in immediately available funds equal to the amount of the
drawing, whereupon the Lenders shall each be deemed to have made an Acquisition
Loan consisting of an Alternate Base Rate Loan to the applicable Borrower in
that amount. If any Lender so notified fails to make available to the Agent for
the account of the Issuing Bank said amount by no later than 12:00 NOON,
HOUSTON, TEXAS TIME, on the Honor Date, then interest shall accrue on such
Lender's obligation to make such payment, from the Honor Date to the date such
Lender makes such payment, at the rate per annum equal to the Federal Funds Rate
in effect from time to time during such period. The Agent will promptly give
notice to each Lender of the occurrence of the Honor Date, but failure of the
Agent to give any such notice on the Honor Date or in sufficient time to enable
any Lender to effect such payment on such date shall not relieve such Lender
from its obligations under this Section 6.3.
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(d) With respect to any unreimbursed drawing that is not
converted into an Alternate Base Rate Loan to the Company in whole or in part,
because of failure of the Company to satisfy the conditions set forth in Article
VIII or for any other reason, the Company shall be deemed to have incurred from
the Issuing Bank a Letter of Credit Borrowing in the amount of such drawing,
which Letter of Credit Borrowing shall be due and payable on demand (together
with interest) and shall bear interest at a rate per annum equal to the
Alternate Base Rate plus two percent (2%) per annum, and each Lender's payment
to the Issuing Bank pursuant to Section 6.3(b) shall be deemed payment in
respect of its participation in such Letter of Credit Borrowing and shall
constitute a Letter of Credit Advance from such Lender in satisfaction of its
participation obligation under this Section 6.3.
(e) Each Lender's obligation in accordance with this Agreement
to make Acquisition Loans or Letter of Credit Advances, as contemplated by this
Section 6.3, as a result of a drawing under the Letter of Credit, shall be
absolute and unconditional and without recourse to the Issuing Bank and shall
not be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
Issuing Bank, any Borrower or any other Person for any reason whatsoever, (ii)
the occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Acquisition Loans under this Section 6.3 is subject
to the conditions set forth in Article VIII.
SECTION VI.4 Repayment of Participation.
(a) When the Agent receives (and only if the Agent receives),
for the account of the Issuing Bank, immediately available funds from the
Borrowers (i) in respect of which any Lender has paid the Agent for the account
of the Issuing Bank for such Lender's participation in the Letter of Credit
Advance pursuant to Section 6.3 or (ii) in payment of interest thereon, the
Agent will pay to each Lender, in the same funds as those received by the Agent
for the account of the Issuing Bank, the amount of such funds attributable to
each such Lender and the Issuing Bank shall receive and retain the amount of
such funds attributable to any Lender that did not so pay the Agent for the
account of the Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any time
to return to the Borrowers or to a trustee, receiver, liquidator, custodian, or
any official in an Insolvency Proceeding, any portion of the payments made by
the Borrowers to the Agent for the account of the Issuing Bank pursuant to
Section 6.4(a) in reimbursement of a payment made under the Letter of Credit
Advance or interest thereon, each of the Lenders shall, on demand of the Agent,
in accordance with each Lender's Pro Rata Share of Acquisition Loan Commitments,
forthwith return to the Agent or the Issuing Bank the amount so returned by the
Agent or the Issuing Bank plus interest thereon from the date such demand is
made to the date such amounts are returned by such Lender to the Agent or the
Issuing Bank, at a rate per annum equal to the Federal Funds Rate in effect from
time to time.
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SECTION VI.5 Role of the Issuing Bank.
(a) Each Lender and each Borrower agree that, in paying any
drawing under a Letter of Credit, the Issuing Bank shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and other documents, if any, expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document.
(b) Neither the Issuing Bank nor any of its correspondents,
participants or assignees shall be liable to any Lender for: (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders (including the Required Lenders, as applicable); (ii) any action
taken or omitted in the absence of gross negligence or willful misconduct; or
(iii) the due execution, effectiveness, validity or enforceability of any Letter
of Credit-Related Document.
(c) The Borrowers hereby assume all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided, however, that this assumption is not intended to, and shall
not, preclude any Borrower from pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement or
assume risks or losses arising out of the gross negligence, bad faith or willful
misconduct of the Issuing Bank. Neither the Issuing Bank, nor any
correspondents, participants or assignees of the Issuing Bank, shall be liable
or responsible for any of the matters described in clauses (i) through (vii) of
Section 6.6; provided, however, that any Borrower may have a claim against the
Issuing Bank, and the Issuing Bank may be liable to such Borrower, to the
extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered or incurred by such Borrower(s) which are caused by
the Issuing Bank's willful misconduct or gross negligence (i) in failing to pay
under any Letter of Credit after the presentation to it by the beneficiary of a
sight draft, certificate(s) and any other documents, if any, strictly complying
with the terms and conditions of such Letter of Credit, (ii) in its paying under
a Letter of Credit against presentation of a sight draft, certificate(s) or
other documents not complying with the terms of such Letter of Credit or (iii)
its failure to comply with the obligations imposed upon it, as an issuing bank,
under applicable state law; provided, however, that (y) the Issuing Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and (z) the Issuing Bank shall not be responsible
for the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason, provided that any such instrument appears
on its face to be in order.
SECTION VI.6 Obligations Absolute. The Obligations of the Borrowers
under this Agreement and any Letter of Credit-Related Document to reimburse the
Issuing Bank for a drawing under a Letter of Credit, and to repay any Letter of
Credit Borrowing and any drawing under a Letter of Credit converted into an
Acquisition Loan, shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement and each such other
Letter of Credit-Related Document under all circumstances, including the
following: (i) any lack of validity or enforceability of this Agreement or any
Letter of Credit-Related Document; (ii) any change in the
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time, manner or place of payment of, or in any other term of, all or any of the
Obligations of any Borrower in respect of any Letter of Credit, (iii) the
existence of any claim, set-off, defense or other right that any Borrower may
have at any time against any beneficiary or any such transferee of any Letter of
Credit (or any Person for whom any such beneficiary or any such transferee may
be acting), the Issuing Bank or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by the Letter of
Credit-Related Documents or any unrelated transaction other than the defense of
payment or claims arising out of the gross negligence, bad faith or wilful
misconduct of the Floor Plan Agent or the Swing Line Bank; (iv) any draft,
demand, certificate or other document presented under any Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or any loss or
delay in the transmission or otherwise of any document required in order to make
a drawing under any Letter of Credit; (v) any payment by the Issuing Bank under
any Letter of Credit against presentation of a draft or certificate that does
not strictly comply with the terms of any Letter of Credit; or any payment made
by the Issuing Bank under any Letter of Credit to any trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of a successor to any beneficiary or any
transferee of any Letter of Credit, including any arising in connection with any
Insolvency Proceeding; (vi) any exchange, release or non-perfection of any
Collateral, or any release or amendment or waiver of or consent to departure
from any other guarantee, for all or any of the Obligations of any Borrower in
respect of any Letter of Credit; or (vii) any other circumstance that might
otherwise constitute a defense available to, or discharge of, any Borrower.
SECTION VI.7 Letter of Credit Fees.
(a) Letter of Credit Fees. The Company shall pay to the Agent
for the account of each of the Lenders a letter of credit fee (the "Letter of
Credit Fees") with respect to outstanding Letters of Credit equal to the greater
of: (i) $500, or (ii) the Applicable Margin for Eurodollar Loans which are
Acquisition Loans multiplied by the average daily maximum amount available to be
drawn on such outstanding Letters of Credit.
(b) Fronting Fees. The Company shall pay to the Issuing Bank
for its own account a letter of credit fronting fee (the "Fronting Fees") for
each Letter of Credit Issued by the Issuing Bank equal to one hundred
twenty-five-one-thousandths percent (0.125%) per annum multiplied by the average
daily maximum amount available to be drawn on such outstanding Letters of
Credit.
(c) Calculation of Fees. The Letter of Credit Fees and the
Fronting Fees each shall be computed on a quarterly basis in arrears on the last
Business Day of each calendar quarter based upon Letters of Credit outstanding
for that quarter as calculated by the Agent (computed on the basis of the actual
number of days elapsed over a year of 360 days). Such fees shall be due and
payable quarterly in arrears on the last Business Day of each calendar quarter
during which Letters of Credit are outstanding, commencing on the first such
quarterly date to occur after the Closing Date, through the Maturity Date, with
the final payment to be made on the Maturity Date.
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(d) Other. The Company shall pay to the Issuing Bank from time
to time on demand the normal issuance, presentation, amendment and other
processing fees, and other standard costs and charges of the Issuing Bank
relating to Letters of Credit as from time to time in effect.
SECTION VI.8 Cash Collateralization.
(a) If any Event of Default shall occur and be continuing, or
the Acquisition Loan Commitment is terminated or reduced to an amount
insufficient to fund the outstanding Letter of Credit Obligations, the Company
agrees that it shall on the Business Day it receives notice from the Agent,
acting upon instructions of the Required Lenders, deposit in an account (the
"Cash Collateral Account") held by the Agent, for the benefits of the Lenders,
an amount of cash equal to the Letter of Credit Obligations as of such date.
Such deposit shall be held by the Agent as Collateral for the payment and
performance of the Obligations. The Agent shall have exclusive dominion and
control, including exclusive right of withdrawal, over such account. Cash
Collateral shall be held in a blocked, interest-bearing account held by the
Agent upon such terms and in such type of account as customary at the depository
institution. The Company shall pay any fees charged by the Agent which fees are
of the type customarily charged by such institution with respect to such
accounts. Moneys in such account shall (i) be applied by the Agent to the
payment of Letter of Credit Borrowings and interest thereon, (ii) be held for
the satisfaction of the reimbursement Obligations of the Borrowers in respect of
Letters of Credit, and (iii) in the event the maturity of the Loans has been
accelerated, with the consent of the Required Lenders, be applied to satisfy the
Obligations. If the Company shall provide Cash Collateral under this Section
6.08(a) or shall prepay any Letter of Credit and thereafter either (i) drafts or
other demands for payment complying with the terms of such Letters of Credit are
not made prior to the respective expiration dates thereof, or (ii) such Event of
Default shall have been waived or cured, then the Agent, the Floor Plan Agent,
the Swing Line Bank and the Lenders agree that the Agent is hereby authorized,
without further action by any other Person, to release the Lien in such cash and
will direct the Agent to remit to the Company amounts for which the contingent
obligations evidenced by such Letters of Credit have ceased.
(b) As security for the payment of all Obligations, each
Borrower hereby grants, conveys, assigns, pledges, sets over and transfers to
the Agent, and creates in the Agent's favor a Lien on, and security interest in,
all money, instruments and securities at any time held in or acquired in
connection with the Cash Collateral Account, together with all proceeds thereof.
At any time and from time to time, upon the Agent's request, each Borrower
promptly shall execute and deliver any and all such further instruments and
documents as may be reasonably necessary, appropriate or desirable in the
Agent's judgment to obtain the full benefits (including perfection and priority)
of the security interest created or intended to be created by this Section
6.8(b) and of the rights and powers herein granted.
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ARTICLE VII
REPRESENTATIONS AND WARRANTIES
The Company, as to itself and as to all of the other Borrowers and each
of the Borrowers other than the Company, as to itself and its Subsidiaries only,
represent and warrant to the Agent, the Floor Plan Agent, the Swing Line Bank
and the Lenders as follows:
SECTION VII.1 Organization; Corporate Powers. The Company and each of
its Subsidiaries is duly organized, validly existing and in good standing under
the laws of the state of its respective incorporation or organization, has the
requisite power and authority, governmental licenses, consents and approvals to
own its property and assets and to carry on its business as now conducted and is
qualified to do business in every jurisdiction where such qualification is
required and is in compliance with all Requirements of Law except where the
failure to so qualify or comply could not reasonably be expected to have a
Material Adverse Effect. Each Borrower and each of their Subsidiaries has the
corporate power to execute, deliver and perform its Obligations under this
Agreement and the other Loan Documents to which it is a party, to borrow
hereunder and to execute and deliver the Notes and the Swing Ling Note.
SECTION VII.2 Authorization. The execution, delivery and performance of
this Agreement and the Loan Documents, the Borrowings hereunder, and the
execution and delivery of the Notes and the Swing Line Note by the Borrowers,
the issuance of Letters of Credit and Drafting Agreements hereunder and the use
of the proceeds of the Borrowings (a) have been duly authorized by all requisite
corporate and, if required, stockholder action on the part of the Company and
each Subsidiary and (b) will not (i) violate (A) any provision of law, statute,
rule or regulation or the certificate of incorporation or the bylaws of the
Company or any Subsidiary, (B) any order of any court, or any rule, regulation
or order of any other agency of government binding upon the Company or any
Subsidiary or (C) any provisions of any indenture, agreement or other instrument
to which the Company or any of its Subsidiaries is a party, or by which the
Company or any Subsidiary or any of their respective properties or assets are or
may be bound which violation could reasonably be expected to have a Material
Adverse Effect, (ii) be in conflict with, result in a breach of or constitute
(alone or with notice or lapse of time or both) a default under any indenture,
agreement or other instrument referred to in (b)(i)(C) above which violation
could reasonably be expected to have a Material Adverse Effect or (iii) result
in the creation or imposition of any Lien whatsoever upon any property or assets
of the Company or any of its Subsidiaries.
SECTION VII.3 Governmental Approval. No registration with, or consent
or approval of, or other action by, any federal, state or other Governmental
Authority is or will be required in connection with the execution, delivery and
performance of this Agreement, any other Loan Document, the execution and
delivery of the Notes and the Swing Line Note or repayment of the Borrowings
hereunder.
SECTION VII.4 Enforceability. This Agreement and each of the Loan
Documents have been duly executed and delivered by each of the Borrowers and
each of their Subsidiaries which is
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a party thereto and constitute legal, valid and binding obligations of the
Borrowers and such Subsidiaries, and the Notes, and the Swing Line Note, when
duly executed and delivered by each applicable Borrower, will constitute legal,
valid and binding Obligations of such Borrower(s), in each case enforceable in
accordance with their respective terms (subject, as to the enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, moratorium and
similar laws affecting creditors' rights generally and general principles of
equity).
SECTION VII.5 Financial Statements.
(a) The audited consolidated financial statements of the
Company and each of its Subsidiaries, as of December 31, 1998, copies of which
have been furnished to the Lenders, have been prepared in conformity with GAAP
applied on a basis consistent with that of the preceding fiscal year, and
present fairly the financial condition of the Company and each of its
Subsidiaries, as at such date and the consolidated results of the operations of
the Company and each of its Subsidiaries for the period then ended.
(b) The Form 10-K of the Company for the fiscal year ended
December 31, 1998, copies of which have been furnished to the Lenders, have been
prepared in accordance with all applicable rules, regulations and guidelines of
the Securities and Exchange Commission and present fairly the financial
condition of the Company and each of its Subsidiaries, as at such dates and the
results of their operations for the periods then ended, subject to year-end
audit adjustments.
SECTION VII.6 No Material Adverse Change. There has been no material
adverse change in the businesses, assets, operations, prospects or condition,
financial or otherwise, as determined on a consolidated basis, of the Company or
any of its Subsidiaries, since December 31, 1998.
SECTION VII.7 Title to Properties; Security Documents.
(a) Each Borrower and each of their respective Subsidiaries
has good and marketable title to, or valid leasehold interests in, all its
properties and assets, including, without limitation, those properties and
assets which constitute real property as specified in Schedule IV (which
Schedule specifies the owner of, current leases (if any) of, and general
description of each individual property or asset listed therein), except for (i)
such properties as are no longer used or useful in the conduct of its business
or as have been disposed of in the ordinary course of business, (ii) Liens
permitted by Section 7.16, Section 10.2, and Section 10.19, and (iii) minor
defects in title that do not interfere with the ability of such Borrower or such
Subsidiary to conduct its business as now conducted.
(b) The Security Documents contain descriptions of the
Collateral sufficient to grant to the Agent for the benefit of Lenders,
perfected Liens therein pursuant to applicable law and the terms, provisions and
conditions of this Agreement.
SECTION VII.8 Litigation; Compliance with Laws; Etc.
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(a) There are no actions, suits or proceedings, except as
specified in Schedule V, at law or in equity or by or before any Governmental
Authority now pending or, to the knowledge of any of the Borrowers or any of
their respective Subsidiaries, threatened against or affecting any of the
Borrowers or any of their respective Subsidiaries or the business, assets or
rights of any of the Borrowers or any of their respective Subsidiaries as to
which there is a reasonable possibility of an adverse determination and which,
if adversely determined, could, individually or in the aggregate, reasonably to
be expected to have a Material Adverse Effect.
(b) None of the Borrowers and none of their respective
Subsidiaries is (i) in violation of any law, the breach or consequence of which
could reasonably be expected to have a Material Adverse Effect and to the best
knowledge of the Company and its Subsidiaries after due investigation, the
Company and each of its Subsidiaries are in material compliance with all
statutes and governmental rules and regulations applicable to them, or (ii) in
default under any material order, writ, injunction, award or decree of any
Governmental Authority binding upon it or its assets or any material indenture,
mortgage, contract, agreement or other undertaking or instrument to which it is
a party or by which any of its properties may be bound, which default could
reasonably be expected to have a Material Adverse Effect, and nothing has
occurred which would materially and adversely affect the ability of any Borrower
to carry on its business as now conducted or perform its obligations under any
such order, writ, injunction, award or decree or any such material indenture,
mortgage, contract, agreement or other undertaking or instrument.
SECTION VII.9 Agreements; No Default.
(a) None of the Borrowers and none of their respective
Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction reasonably to be expected to have a Material Adverse
Effect.
(b) No Event of Default has occurred and is continuing.
SECTION VII.10 Federal Reserve Regulations.
(a) Neither the Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying Margin Stock.
(b) No part of the proceeds of the Loans will be used, whether
directly or indirectly, and whether immediately, incidentally or ultimately, (i)
to purchase or carry Margin Stock or to extend credit to others for the purpose
of purchasing or carrying Margin Stock or to refund indebtedness originally
incurred for such purpose, or (ii) for any purpose which entails a violation of,
or which is inconsistent with, the provisions of the Regulations of the Board,
including Regulations T, U or X; provided, however, the Company may acquire
Margin Stock if, upon the acquisition of such Margin Stock, twenty-five percent
(25%) or less of the Company's total assets subject to the restrictions set
forth in Section 10.1 would then be composed of Margin Stock, and
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the Company shall furnish to the Agent upon its request, a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to in
Regulation U.
SECTION VII.11 Taxes. The Company and each of its Subsidiaries has
filed all tax returns which are required to have been filed and has paid, or
made adequate provisions for the payment of, all of its taxes which are due and
payable, except such taxes, if any, as are being contested in good faith and by
appropriate proceedings and as to which such reserves or other appropriate
provisions as may be required by GAAP have been maintained. Neither the Company
nor any of its Subsidiaries is aware of any proposed assessment against it for
additional taxes (or any basis for any such assessment) which might be material
to the Company or such Subsidiary.
SECTION VII.12 Pension and Welfare Plans. Each Plan complies in all
respects with all applicable statutes and governmental rules and regulations
except where the failure to comply could not reasonably be expected to have a
Material Adverse Effect, and: (a) no Reportable Event has occurred and is
continuing with respect to any Plan, (b) since December 31, 1998, neither the
Company nor any ERISA Affiliate has withdrawn from any Plan or instituted steps
to do so, except as listed on Schedule VI and (c) since December 31, 1998, no
steps have been instituted to terminate any Plan, except as listed on Schedule
VI. No condition exists or event or transaction has occurred in connection with
any Plan which could result in the incurrence by the Company or any ERISA
Affiliate of any liability, fine or penalty which could reasonably be expected
to have a Material Adverse Effect. Neither the Company nor any ERISA Affiliate
is a member of, or contributes to, any multiple employer Plan as described in
Section 4064 of ERISA. None of the Borrowers has any contingent liability with
respect to any post-retirement "welfare benefit plans," as such term is defined
in ERISA.
SECTION VII.13 No Material Misstatements. Neither this Agreement, the
other Loan Documents, the Confidential Information Memorandum nor any other
document delivered by or on behalf of the Company or any Subsidiary in
connection with any Loan Document or included therein contained or contains any
material misstatement of fact or omitted or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
SECTION VII.14 Investment Company Act; Public Utility Holding Company
Act. Neither the Company nor any of its Subsidiaries is an "investment company"
or company "controlled" by an investment company as defined in, or subject to
regulation under, the Investment Company Act of 1940. Neither the Company nor
any of its Subsidiaries is a "holding company" as defined in, or subject to
regulation under, the Public Utility Holding Company Act of 1935.
SECTION VII.15 Maintenance of Insurance. The Company and each of its
Subsidiaries agree to maintain insurance to such extent and against such hazards
and liabilities as is commonly maintained by companies similarly situated.
SECTION VII.16 Existing Liens. None of the assets of the Company or any
Subsidiary is subject to any Lien, except:
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(a) Liens for current taxes not delinquent or taxes being
contested in good faith and by appropriate proceedings and as to which such
reserves or other appropriate provisions as may be required by GAAP are being
maintained;
(b) carriers', warehousemen's, mechanics', materialmen's and
other like statutory Liens arising in the ordinary course of business securing
obligations which are not overdue for a period of more than ninety (90) days or
which are being contested in good faith and by appropriate proceedings and as to
which such reserves or other appropriate provisions as may be required by GAAP
are being maintained;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, and other obligations of a like nature
incurred in the ordinary course of business, and Liens securing reimbursement
obligations created by open letters of credit for the purchase of inventory;
(e) Liens granted by a Subsidiary of the Company to secure
such Subsidiary's Indebtedness to the Company or to any other Subsidiary of the
Company;
(f) Liens, if any, disclosed in the financial statements
referred to in Section 7.5; and
(g) Liens listed on Schedule VII and Liens permitted by
Section 10.2.
SECTION VII.17 Environmental Matters. Each Borrower has complied in all
respects with all applicable federal, state, local and other statutes,
ordinances, orders, judgments, rulings and regulations relating to environmental
pollution or to environmental regulation or control except where the failure to
comply could not reasonably be expected to have a Material Adverse Effect.
Neither the Company nor any of its Subsidiaries has received notice of any
failure so to comply which alone or together with any other such failure could
reasonably be expected to have a Material Adverse Effect. Neither the Company,
any of its Subsidiaries nor any of its facilities manages any hazardous wastes,
hazardous substances, hazardous materials, toxic substances or toxic pollutants,
as those terms are used in the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response Compensation and Liability Act, the
Hazardous Materials Transportation Act, the Toxic Substance Control Act, the
Clean Air Act or the Clean Water Act, in violation of any regulations
promulgated pursuant thereto or in any other applicable law where such violation
could reasonably be expected to have, individually or together with other
violations, a Material Adverse Effect.
SECTION VII.18 Subsidiaries. As of the Closing Date, the Company has no
Subsidiaries, and no Subsidiary has a Subsidiary other than those specifically
disclosed in part (a) of
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Schedule VIII, and neither the Company nor any Subsidiary has any equity
investments in any other corporation or entity other than those specifically
disclosed in part (b) of Schedule VIII. The state of incorporation, address,
principal place of business and a list of other business locations for each
Subsidiary is specified in part (a) of Schedule VIII. The Company and/or each of
its Subsidiaries is the owner, directly or indirectly, free and clear of all
Liens (except for Liens in favor of the Agent and the Lenders and transfer
restrictions contained in the Dealer Franchise Agreements), of all of the issued
and outstanding voting stock of each Subsidiary disclosed on Schedule VIII
(except where ownership of less than one hundred percent (100%) is indicated on
Schedule VIII). All shares of such stock have been validly issued and are fully
paid and nonassessable, and no rights to subscribe to additional shares have
been granted or exist.
SECTION VII.19 Engaged in Motor Vehicle Sales. The Floor Plan Borrowers
are engaged in the business of selling new and/or Used Motor Vehicles; all such
Motor Vehicles consist solely of goods held by the Borrowers for sale; no sales
or other transactions involving such Motor Vehicles are and will not become
subject to set-off, counterclaim, defense, allowance, or adjustment (other than
warranty claims, the aggregate amount of which shall not be material); except as
set forth in Schedule VII, as of the Closing Date, there is no financing
statement, or similar statement or instrument of registration under the laws of
any jurisdiction, covering or purporting to cover any interest of any kind in
all such Motor Vehicles or their proceeds on file or registered in any public
office other than a financing statement in favor of the Agent for the benefit of
the Lenders covering all such Motor Vehicles; except as set forth in Schedule
VII, as of the Closing Date, there is no other floor plan or other financing
arrangement with any party other than the Agent for the benefit of the Lenders
with respect to all such Motor Vehicles; and except as set forth in Schedule
VII, as of the Closing Date, none of the Borrowers has made any other verbal or
written contract or arrangement of any kind, the performance of which by the
other party thereto would give rise to a Lien against any such Motor Vehicle, or
the proceeds thereof; all such Motor Vehicles are free from damage caused by
fire or other casualty, unless covered by insurance, subject to customary
deductibles. The locations (and addresses) set forth in Schedule IV are the
locations at which the Company and its Subsidiaries keep the Motor Vehicles held
as inventory, except when such Motor Vehicles may be in transit between
locations, in transit for `dealer swaps' or being test driven by potential
customers. The addresses set forth in Schedule IV are each Floor Plan Borrower's
place of business if such Person has only one such place of business; or a Floor
Plan Borrower's chief executive office if it has more than one place of
business. All of each Floor Plan Borrower's books and records with regard to all
Motor Vehicles are maintained and kept at the address(es) of such Floor Plan
Borrower set forth in Schedule IV.
SECTION VII.20 Dealer Franchise Agreements. As of the Closing Date,
none of the Borrowers is a party to any dealer franchise agreements ("Dealer
Franchise Agreements") other than those specifically disclosed in Schedule IX,
which schedule shows the Manufacturer and the Borrower which is a party to each
such agreement, the date such agreement was entered into and the expiration date
(if any) of each such agreement. Each of the Dealer Franchise Agreements is
currently in full force and effect, and no Borrower has received any notice of
termination with respect to any such agreements; and, except as disclosed on
Schedule IX, no Borrower is aware of any event which with notice, lapse of time,
or both would allow any Manufacturer which is a party
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to any of the Dealer Franchise Agreements to terminate any such agreements.
There exists no actual or threatened termination, cancellation, or limitation
of, or any modification or change in, the business relationship between any
Borrower and any customer or any group of customers whose purchases individually
or in the aggregate are material to the business of such Borrower, or with any
material Manufacturer, and there exists no present condition or state of facts
or circumstances which could reasonably be expected to have a Material Adverse
Effect.
SECTION VII.21 Year 2000 Requirement. Any reprogramming required to
permit the proper functioning, in and following the year 2000, of (i) the
Borrowers' computer systems and (ii) equipment containing embedded microchips
(including systems and equipment supplied by others or with which Borrowers'
systems interface) and the testing of all such systems and equipment, as so
reprogrammed was completed by October 1, 1999. The cost to the Borrowers of such
reprogramming and testing and of the reasonably foreseeable consequences of year
2000 to the Borrowers (including, without limitation, reprogramming errors and
the failure of others' systems or equipment) will not result in a Default or a
Material Adverse Effect. Except for such of the reprogramming referred to in the
preceding sentence as may be necessary, the computer and management information
systems of the Borrowers are and, with ordinary course upgrading and
maintenance, will continue for the term of this Agreement to be, sufficient to
permit the Borrowers to conduct their businesses without Material Adverse
Effect.
ARTICLE VIII
CONDITIONS OF LENDING
SECTION VIII.1 Conditions Precedent to Closing Date. The Closing Date
shall be deemed to have occurred when the following conditions precedent shall
have occurred and the Agent shall have received on or before such date the
following, each dated (unless otherwise indicated) the Closing Date and, with
respect to all such documents referred to in Section 8.1(a), Section 8.1(b),
Section 8.1(c), and Section 8.1(d) in sufficient copies for each Lender:
(a) The Agent shall have received from each Borrower:
(i) A counterpart of this Agreement (to which all
of the Exhibits and Schedules have been attached) executed by
the Borrowers, the Agent, the Floor Plan Agent, the Swing Line
Bank and the Lenders.
(ii) Notes of the Borrowers dated the Closing
Date, properly executed by the Borrowers to the order of the
Lenders, respectively.
(iii) the Swing Line Note, dated the Closing
Date, properly executed by the Floor Plan Borrowers to the
order of the Swing Line Bank.
(b) The Agent shall have received from each Borrower:
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(i) a Security Agreement substantially in the
form set forth in Exhibit F, dated as of the Closing Date or
an earlier date;
(ii) an Escrow and Security Agreement in the form
set forth in Exhibit D, dated as of the Closing Date or an
earlier date;
(iii) if required by Agent, landlord lien waivers
in the form satisfactory to Agent and its counsel, with
respect to all real property leased by any of the Borrowers
other than Phase 1 Borrowers;
(iv) GM Borrower Guaranty, in substantially the
form set forth in Exhibit L dated as of the Closing Date or an
earlier date, properly executed by each of the GM Borrowers;
and
(v) any other necessary Security Documents in the
form satisfactory to the Agent and its counsel;
each of which, if required by this Agreement, shall be duly executed by the
parties thereto; provided, however, the Obligations secured by the Security
Documents executed by the GM Borrowers and the Ford Borrowers and the Collateral
described therein may be limited, respectively, to the GM Borrower Liability
Amount and the Ford Borrower Liability Amount.
(c) The Lenders shall have received from each Borrower, (i) a
certificate of the Secretary or an Assistant Secretary of the Company and each
of its Subsidiaries, dated the Closing Date, certifying that (A) the certificate
of incorporation or certificate of limited partnership and by-laws or
partnership agreement, as applicable, of the Company and each of its
Subsidiaries, delivered to the Lender in connection with the Third Amended and
Restated Credit Agreement or any Addendum thereto have not been amended, (B)
attached thereto is a true and complete copy of resolutions or unanimous consent
duly adopted by its Board of Directors or partners authorizing the execution,
delivery and performance of this Agreement, the Notes, the Swing Line Note
and/or Loan Documents to which it is a party, and that such resolutions have not
been modified, rescinded or amended and are in full force and effect, and (C) as
to the incumbency and specimen signature of each officer of each Borrower
executing this Agreement, the Notes, the Swing Line Note, any of the Loan
Documents or any other document delivered in connection herewith or therewith;
(ii) a certificate of another officer of each Borrower, which is a party to this
Agreement, the Notes, the Swing Line Note and/or any of the Loan Documents as to
the incumbency and specimen signature of the Secretary or such Assistant
Secretary of such Person; and (iii) such other documents as ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
L.L.P., special counsel for the Agent, may reasonably request.
(d) The Lenders shall have received from each Borrower a
certificate of a Senior Vice President, an Executive Vice President or a Vice
President of each Borrower dated the Closing Date certifying (i) the truth of
the representations and warranties made by such Borrower in this Agreement, and
(ii) the absence of the occurrence and continuance of any Default or Event of
Default.
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(e) The Agent shall have received the Agent's Letter duly
executed by the Company.
(f) The Floor Plan Agent shall have received the Floor Plan
Agent's Letter duly executed by the Company.
(g) The opinion of counsel to the Borrowers and any Subsidiary
which signs any of the Loan Documents, dated the Closing Date, addressed to the
Agent and the Lenders and in the form of Exhibit H hereto.
(h) The Agent shall have received an Administrative
Questionnaire completed by each Lender and, if required, the tax forms set forth
in Section 5.14.
(i) The fees and disbursements required to be paid by the
Company pursuant to Section 5.4 and 13.4 on the Closing Date shall have been
paid.
(j) All UCC-1 filings and other Liens not permitted pursuant
to this Agreement which are existing or reflected in searches performed by the
Agent or its counsel as of the Closing Date shall have been released and/or
terminated to the satisfaction of the Agent and its counsel.
SECTION VIII.2 Conditions Precedent to Initial Borrowing.
(a) The date on which the obligation of each Lender to make
the initial Acquisition Loans, or of the Issuing Bank to issue any Letter of
Credit (the "Acquisition Funding Date") to the Company shall be deemed to have
occurred and is subject to the conditions precedent that:
(i) Each document (including, without limitation,
any UCC financing statement) required by the Security
Documents or under law or requested by Agent to be filed,
registered or recorded in order to create, in favor of Agent,
for the benefit of Lenders, a perfected first Lien (subject to
any Permitted Liens) on the Collateral owned by the Company
shall have been properly filed, registered or recorded in each
jurisdiction in which the filing, registration or recordation
thereof is so required or requested, and the Agent, as herein
provided, shall have received an acknowledgment copy, or other
evidence satisfactory to it, of each such filing, registration
or recordation and satisfactory evidence of the payment of any
necessary fee, tax or expense relating thereto; and
(ii) Such other and further conditions shall have
been fulfilled as the Agent, or its counsel shall have
reasonably determined.
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(b) The date on which the obligation of each Lender to make
the initial Floor Plan Loans or of the Swing Line Bank to make the initial Swing
Line Loan, or of the Floor Plan Agent to issue any Drafting Agreement ("each, a
Floor Plan Funding Date") to any Floor Plan Borrower shall be deemed to have
occurred and is subject to the condition precedent that:
(i) Each document (including, without limitation,
any UCC financing statement) required by the Security
Documents or under law or requested by Agent or the Floor Plan
Agent to be filed, registered or recorded in order to create,
in favor of Agent, for the benefit of Lenders, a perfected
first Lien on the Collateral owned by such Floor Plan Borrower
shall have been properly filed, registered or recorded in each
jurisdiction in which the filing, registration or recordation
thereof is so required or requested, and the Agent or Floor
Plan Agent, as herein provided, shall have received an
acknowledgment copy, or other evidence satisfactory to it, of
each such filing, registration or recordation and satisfactory
evidence of the payment of any necessary fee, tax or expense
relating thereto;
(ii) The Floor Plan Agent shall have completed to
its' satisfaction any and all audits of Motor Vehicles owned
by or in transit to each such Floor Plan Borrower; and
(iii) The Company shall have delivered to the
Agent copies of substantially all Dealer Franchise Agreements
between Manufacturers and its Subsidiaries, which Dealer
Franchise Agreements have been duly executed between a
Manufacturer and such Subsidiary. For purposes of this
subsection, the term "substantially all" shall mean that the
Agent and the Floor Plan Agent shall be satisfied in their
sole determination that a sufficient amount of duly executed
Dealer Franchise Agreements have been delivered by the
Company.
(c) Such other and further conditions shall have been
fulfilled as the Agent, the Floor Plan Agent or its counsel shall have
reasonably determined.
SECTION VIII.3 Conditions Precedent to Each Borrowing. The obligation
of each Lender to make a Loan on the occasion of any Borrowing (including the
initial Acquisition Borrowing and the initial Floor Plan Borrowing) and the
obligation of the Issuing Bank to issue Letters of Credit and the obligation of
the Swing Line Bank to make Swing Line Loans and the obligation of the Floor
Plan Bank to issue Drafting Agreements shall be subject to the further
conditions precedent that on the Borrowing Date of such Borrowing or Issuance
the Company shall execute and deliver to the Agent a Request for Borrowing and
the following statements shall be true (and the acceptance by any Borrower of
the proceeds of such Borrowing shall constitute a representation and warranty by
the Company that on the date of such Borrowing such statements are true):
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(a) The representations and warranties contained in Article
VII are correct on and as of the date of such Borrowing, before and after giving
effect to such Borrowing and to the application of the proceeds therefrom, as
though made on and as of such date;
(b) No event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom, which
constitutes either a Default or an Event of Default; and
(c) Following the making of such Borrowing or Issuance of any
Letter of Credit and all other Borrowings to be made on the same day under this
Agreement, except as may otherwise be permitted hereunder (i) if such Borrowing
is a Floor Plan Loan Borrowing, the aggregate principal amount of all Floor Plan
Loans outstanding plus all Swing Line Loans outstanding shall not exceed the
Floor Plan Loan Commitments of all the Lenders, (ii) if such Borrowing is an
Acquisition Loan Borrowing, the aggregate principal amount of all Acquisition
Loans outstanding plus Letters of Credit Obligations outstanding shall not
exceed the Acquisition Loan Commitments of all the Lenders, (iii) if such
Borrowing is a Swing Line Loan Borrowing, the aggregate principal amount of all
Swing Line Loans outstanding shall not exceed the Swing Line Commitment, (iv) if
a Letter of Credit is issued, the total amount of Letter of Credit outstanding
plus the aggregate principal amount of all Acquisition Loans outstanding shall
not exceed the Acquisition Loan Commitments of all the Lenders, and (v) the
aggregate principal amount of all Loans and Letter of Credit Obligations then
outstanding shall not exceed the Total Commitments.
SECTION VIII.4 Conditions Precedent to Conversions and Continuations.
The obligation of the Lenders to convert any existing Borrowing into a
Eurodollar Borrowing or to continue any existing Borrowing as a Eurodollar
Borrowing is subject to the condition precedent that on the date of such
conversion or continuation each of the conditions to Borrowing set forth in
Section 8.3 shall have been satisfied, and no Default or Event of Default shall
have occurred and be continuing or would result from the making of such
conversion or continuation. The acceptance of the benefits of each such
conversion and continuation shall constitute a representation and warranty by
the Company to each of the Lenders that no Default or Event of Default shall
have occurred and be continuing or would result from the making of such
conversion or continuation.
ARTICLE IX
AFFIRMATIVE COVENANTS
So long as this Agreement shall remain in effect or the principal of or
interest on any Note, the Swing Line Note, any Commitment Fees or any other fee,
expense or amount payable hereunder shall be unpaid and until the Commitments of
all the Lenders shall expire or terminate, until no Letter of Credit Obligations
are outstanding, and until all Drafting Agreements are terminated, the Company,
as to itself and as to all of the other Borrowers and each of the Borrowers
other than the Company, as to itself and its Subsidiaries only, covenant and
agree with the Agent, the Floor Plan Agent, the Swing Line Bank and each Lender
that:
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SECTION IX.1 Existence. The Company will maintain and preserve, and
except as permitted by Section 10.3, will cause each Subsidiary to maintain and
preserve, its respective existence and good standing under the laws of its state
of jurisdiction, as a corporation or other form of business organization, as the
case may be, and all rights, privileges, licenses, patents, patent rights,
copyrights, trademarks, trade names, franchises and other authority to the
extent material and necessary for the conduct of their respective businesses in
the ordinary course as conducted from time to time.
SECTION IX.2 Repair. The Company will maintain, preserve and keep, and
will cause each of its Subsidiaries to maintain, preserve and keep, all of its
properties in good repair, working order and condition (ordinary wear and tear
excepted), and the Company will make, and will cause each of the Subsidiaries to
make, all necessary and proper repairs, renewals, replacements, additions,
betterments and improvements thereto so that at all times the efficiency thereof
shall be fully preserved and maintained; the Company will at all times do or
cause to be done all things necessary to preserve, renew and keep in full force
and effect, and will cause each Subsidiary to do or cause to be done all things
necessary to preserve, renew and keep in full force and effect, the rights,
licenses, permits, franchises, patents, copyrights, trademarks and trade names
material to the conduct of its businesses; the Company and each of its
Subsidiaries will maintain and operate such businesses in substantially the
manner in which they are presently conducted and operated (subject to changes in
the ordinary course of business); the Company and each of its Subsidiaries will
comply with all laws and regulations applicable to the operation of such
businesses whether now in effect or hereafter enacted and with all other
applicable laws and regulations except where the failure to comply could not
reasonably be expected to have a Material Adverse Effect; and the Company and
each of its Subsidiaries will take all action which may be required to obtain,
preserve, renew and extend all licenses, permits and other authorizations which
may be material to the operation of such businesses.
SECTION IX.3 Insurance. The Company will maintain, on a consolidated
basis, insurance to such extent and against such hazards and liabilities as is
commonly maintained by companies similarly situated or as may be required in the
Security Documents including, without limitation with respect to Motor Vehicles
owned by Floor Plan Borrowers, naming the Agent, for the benefit of the Lenders,
as Mortgagee (in connection with any real estate collateral), lender loss payee
and additional loss payee.
WARNING
UNLESS EACH BORROWER PROVIDES THE AGENT WITH EVIDENCE OF THE INSURANCE COVERAGE
AS REQUIRED BY THE AGREEMENT OR ANY OTHER LOAN DOCUMENT, THE AGENT (AT ITS
DISCRETION, OR ACTING AT THE REQUEST OF THE FLOOR PLAN AGENT) MAY PURCHASE
INSURANCE AT THE BORROWER'S EXPENSE TO PROTECT THE LENDERS' INTEREST. THIS
INSURANCE MAY, BUT NEED NOT, ALSO PROTECT THE BORROWER'S INTEREST. IF THE
COLLATERAL BECOMES DAMAGED, THE COVERAGE THE AGENT PURCHASES MAY NOT PAY ANY
CLAIM ANY BORROWER MAKES OR ANY CLAIM MADE AGAINST THE BORROWER. EACH BORROWER
MAY LATER CANCEL THIS COVERAGE BY PROVIDING EVIDENCE THAT THE BORROWER HAS
OBTAINED PROPERTY COVERAGE ELSEWHERE.
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EACH BORROWER IS RESPONSIBLE FOR THE COST OF ANY INSURANCE PURCHASED BY
THE AGENT. THE COST OF THIS INSURANCE MAY BE ADDED TO THE OBLIGATIONS. IF THE
COST IS ADDED TO THE OBLIGATIONS, THE INTEREST RATE PROVIDED IN SECTION 5.3
SHALL APPLY TO SUCH ADDED AMOUNT. THE EFFECTIVE DATE OF COVERAGE MAY BE THE DATE
ANY BORROWER'S PRIOR COVERAGE LAPSED OR THE DATE THE BORROWER FAILED TO PROVIDE
PROOF OF COVERAGE.
THE COVERAGE THE AGENT PURCHASES MAY BE CONSIDERABLY MORE EXPENSIVE
THAN INSURANCE ANY BORROWER CAN OBTAIN ON ITS OWN AND MAY NOT SATISFY ANY NEED
FOR PROPERTY DAMAGE COVERAGE OR ANY MANDATORY LIABILITY INSURANCE REQUIREMENTS
IMPOSED BY APPLICABLE LAW.
SECTION IX.4 Obligations and Taxes. The Company will pay and discharge
and will cause each of its Subsidiaries to pay and discharge, when due, all
taxes, assessments and governmental charges or levies imposed upon the Company
or such Subsidiary, as the case may be, as well as all lawful claims for labor,
materials and supplies or otherwise unless and only to the extent that the
Company or such Subsidiary, as the case may be, is contesting such taxes,
assessments and governmental charges, levies or claims in good faith and by
appropriate proceedings and the Company or such Subsidiary has set aside on its
books such reserves or other appropriate provisions therefor as may be required
by GAAP.
SECTION IX.5 Financial Statements; Reports. The Company will furnish to
the Agent and each Lender:
(a) Annual Audit Reports. Within 120 days after the end of
each fiscal year of the Company, a copy of the annual audit report of the
Company and its Subsidiaries prepared on a consolidated and consolidating basis
in conformity with GAAP consistently applied and certified by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ or
another independent certified public accountant of recognized national standing;
(b) Quarterly Financial Statements. Within 60 days after the
end of each quarter (except the last quarter) of each fiscal year of the
Company, a copy of the Form 10-Q of the Company, for such quarter, prepared in
accordance with the rules, regulations and guidelines of the Securities and
Exchange Commission and including therein the consolidated and consolidating
financial statement of the Company, subject to normal year end audit
adjustments; and
(c) Officer's Certificate. Together with the financial
statements furnished by the Company under the preceding clauses (a) and (b), a
compliance certificate in the form of Exhibit J executed by the Company's Chief
Financial Officer or Vice President and Treasurer dated the date of such annual
audit report or such quarterly financial statement, as the case may be, and
including therewith the calculations (and supporting documentation and/or backup
in for such calculations) for all financial covenants set forth in Article X
hereof, and notices of all Hedging Agreements to which it is a party as of the
date of such certificate;
(d) SEC and Other Reports. Copies of each filing and report
made by the Company or any of its Subsidiaries with or to any securities
exchange or the Securities and Exchange
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Commission and each communication from the Company or any of its Subsidiaries to
shareholders generally, promptly upon the making thereof;
(e) Manufacturer/Dealer Statements. As soon as available, but
in any event within thirty (30) days after the end of each month, copies of each
Manufacturer/Dealer Statement of each Floor Plan Borrower delivered during such
month;
(f) Inventory Detail Report. Upon request of the Floor Plan
Agent, the Agent or any Lender, copies of the Inventory Detail Report of each
Floor Plan Borrower individually and on a consolidated basis;
(g) Availability Analysis. Together with the financial
statements furnished by the Company under the preceding clauses (a) and (b), a
completed Availability Analysis in the form of Exhibit M, and such other
information as the Agent may have reasonably requested to determine the accuracy
of such calculation, calculated as of the end of the preceding fiscal quarter;
provided, however, in the case of calculations based on financial statements of
any Acquisition consummated in the preceding fiscal quarter not audited by a
nationally recognized accounting firm reasonably acceptable to the Agent, the
Agent shall be satisfied that the consolidated EBITDA of the Auto Dealer so
acquired pursuant to the proposed Acquisition exceeded zero for such period; and
(h) Requested Information. Promptly, from time to time, such
other reports or information as the Agent, the Floor Plan Agent or any Lender
may reasonably request.
SECTION IX.6 Litigation and Other Notices. The Company will notify the
Agent and the Lenders in writing of any of the following immediately upon
learning of the occurrence thereof, describing the same and, if applicable, the
steps being taken by the Person(s) affected with respect thereto:
(a) Judgment. The entry of any judgment or decree against the
Company and/or any of its other Subsidiaries if the aggregate amount of such
judgment or decree exceeds $500,000 (after deducting the amount with respect to
which the Company or such Subsidiary is insured and with respect to which the
insurer has assumed responsibility in writing);
(b) Suits and Proceedings. The filing or commencement of any
action, suit or proceeding, whether at law or in equity or by or before any
court or any Governmental Authority as to which there is a reasonable
possibility of an adverse determination and which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect;
(c) Default. The occurrence of any Event of Default or
Default;
(d) Material Adverse Change. The occurrence of any event which
could reasonably be expected to have a Material Adverse Effect;
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(e) Pension and Welfare Plans. The occurrence of a Reportable
Event with respect to any Plan; the institution of any steps by the Company, any
of its Subsidiaries or any ERISA Affiliate, the PBGC or any other Person to
terminate any Plan; the institution of any steps by the Company, or any of its
Subsidiaries or any ERISA Affiliate to withdraw from any Plan; or the incurrence
of any material increase in the contingent liability of the Company or any of
its Subsidiaries with respect to any post-retirement welfare benefits; or
(f) Other Events. The occurrence of such other events as the
Agent or the Required Lenders may reasonably specify from time to time.
SECTION IX.7 ERISA. Each Borrower will comply with the applicable
provisions of ERISA except where the failure to comply could not reasonably be
expected to have a Material Adverse Effect.
SECTION IX.8 Books, Records and Access. Each Borrower will maintain
complete and accurate books and records in which full and correct entries in
conformity with GAAP shall be made of all dealings and transactions in relation
to the business and activities of such Borrowers. Each Borrower will permit
reasonable access by the Agent and each Lender, upon reasonable request, to the
books and records relating to such Borrower during normal business hours, to
permit or cause to be permitted, the Agent and each Lender to make extracts from
such books and records and permit, or cause to be permitted, upon reasonable
request, any authorized representative designated by any Lender to discuss the
affairs, finances and condition of such Borrower with such Person's principal
financial officers and principal accounting officers and such other officers as
such Borrower shall deem appropriate.
SECTION IX.9 Use of Proceeds. The Borrowers shall use the proceeds of
the Loans for only the following purposes:
(a) Floor Plan Loans. The proceeds of the Floor Plan Loans may
be used only to finance the purchase of Motor Vehicles for resale in the
ordinary course of business of the Floor Plan Borrowers.
(b) Acquisition Loans. The proceeds of the Acquisition Loans
may be used only for the following purposes: (i) for working capital and general
corporate purposes, including, without limitation, the issuance of Letters of
Credit and to pay outstanding Floor Plan Loans; and (ii) to make Permitted
Acquisitions.
(c) Swing Line Loans. The proceeds of the Swing Line Loans may
be used only to finance the purchase of Motor Vehicles for resale in the
ordinary course of business of the Borrowers.
(d) All Loans. No Loans shall be used for any purpose which
would be in contravention of any Requirement of Law.
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SECTION IX.10 Nature of Business. The Borrowers will engage in
substantially the same field of business as they are engaged in on the date
hereof, and except as permitted in Section 10.5(k), will refrain from engaging
in, establishing or becoming in any way involved as a lender in the business of
automobile financing, sub-prime automobile financing or any other credit
transactions related to automobiles other than Retail Loan Guarantees.
SECTION IX.11 Compliance. The Borrowers will comply with all statutes
and governmental rules and regulations applicable to them including all such
statutes and government rules and regulations relating to environmental
pollution or to environmental regulation and control except where the failure to
comply could not reasonably be expected to have a Material Adverse Effect.
SECTION IX.12 Audits
(a) Entry on Premises. Each Floor Plan Borrower shall permit a
duly authorized representative of the Floor Plan Agent to enter upon such
Borrower's premises during regular business hours to perform audits of Motor
Vehicles in a manner satisfactory to the Agent, provided that the Floor Plan
Agent or its representative shall not perform an audit of such Motor Vehicles
prior to the occurrence of an Event of Default without having given the
applicable Borrower reasonable prior notice; and provided, further, however, the
Floor Plan Agent shall not be required to make more than six (6) such audits in
any fiscal year of any Floor Plan Borrower. Each Floor Plan Borrower shall
assist the Floor Plan Agent, and its representatives, in whatever way necessary
to make the inspections and audits provided for herein.
(b) Excess/Payments in Process. The Borrowers shall maintain
as of the last Business Day of each calendar month, Excess/Payments in Process
in an amount of not less than Five Million Dollars ($5,000,000), which amount
may be increased or decreased from time to time in the sole reasonable
determination of the Floor Plan Agent. If and to the extent audits performed
from time to time by the Floor Plan Agent as provided in Section 9.12(a) reveal
that any Motor Vehicles of the Floor Plan Borrowers are for any such calendar
month Out of Balance in an aggregate amount equal to or greater than the
Excess/Payments in Process held by the Floor Plan Agent (the "Out of Balance
Amount"), the Floor Plan Agent shall so notify the Company. The Company shall,
or shall cause the other applicable Floor Plan Borrowers to, deliver by the next
Business Day after receipt of such notice, sufficient funds so as to cause the
Borrowings with respect to any such Motor Vehicles and/or Floor Plan Loans which
are Out of Balance to be in compliance with the Floor Plan Advance Limits. If
the Company or such other Floor Plan Borrowers fail to deliver such funds, or
any of them notifies the Floor Plan Agent that such funds will not be delivered,
the Floor Plan Agent shall, and the Floor Plan Borrowers hereby authorize the
Floor Plan Agent to, apply sufficient funds from such Excess/Payments in Process
to cause the Borrowings with respect to any such Motor Vehicles and/or Floor
Plan Loans which are Out of Balance to be in compliance with the Floor Plan
Advance Limits. The Floor Plan Agent shall provide written notice (including via
fax) to the Company on each Business Day Excess/Payments in Process are so
applied and the Floor Plan Borrowers shall, on or before the next following
Business Day, deposit sufficient funds to restore the balance thereof back to
the Out of Balance Amount then in effect.
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(c) Delivery of Audits. Within thirty (30) days after the end
of each quarter of each fiscal year of the Company, commencing the fourth fiscal
quarter of 1999, the Floor Plan Agent shall deliver to the Agent a summary of
the audits of Motor Vehicles of each of the Floor Plan Borrowers performed by
the Floor Plan Agent during the fiscal quarter just ended, setting forth therein
a spread sheet reflecting for all Floor Plan Borrowers all Motor Vehicles Out of
Balance at any time during such fiscal quarter and the number of days, if any,
each such Motor Vehicle was Out of Balance. The Agent shall promptly deliver a
copy of such report to each Lender.
SECTION IX.13 Demonstrators and Rental Motor Vehicles. The Floor Plan
Agent may from time to time limit the number of Motor Vehicles which may be
placed in service as Demonstrators and Rental Motor Vehicles and establish other
requirements for Demonstrators and Rental Motor Vehicles as the Floor Plan Agent
may reasonably determine. Each Borrower shall maintain records at the premises
where the Motor Vehicles are kept evidencing which Motor Vehicles are being used
as Demonstrators and Rental Motor Vehicles.
SECTION IX.14 Disbursement Account. Subject to the terms and conditions
of this Agreement, including Sections 2.1 and 5.7 hereof, a Floor Plan Borrower
may prepay, in whole or in part, from time to time, outstanding Floor Plan
Loans, Swing Line Loans or Swing Line Overdraft Loans and may reborrow Floor
Plan Loans and Swing Line Loans.
Any or all of the Floor Plan Borrowers and the Floor Plan Agent, at
various times, may be parties to a corporate cash management service agreement
(the "Service Agreement") providing for a controlled disbursement account (the
"Disbursement Account") between such Floor Plan Borrower and the Floor Plan
Agent. Subject to the terms and conditions of this Agreement, each such Floor
Plan Borrower authorizes the Floor Plan Agent to fund the Disbursement Account,
on a daily basis if necessary, by advancing Loans under this Agreement to the
extent of availability under the aggregate Floor Plan Loan Commitments. Each
such Floor Plan Borrower acknowledges and agrees that any requests for funding
from the Disbursement Account will not be paid unless funds in an amount
sufficient to pay such requests are then available for reborrowing in compliance
with the terms and conditions of this Agreement, including Section 2.1 hereof to
enable Floor Plan Agent to advance those funds to the Disbursement Account.
Floor Plan Agent agrees that any requests to be submitted for payment through
the Disbursement Account will not be made unless sufficient funds are available
and such request is made in compliance with the terms and conditions of this
Agreement to pay all such requests. Each Floor Plan Borrower at all times is
responsible for having sufficient available funds in Excess/Payments in Process
to pay all requests to be paid through the Disbursement Account, whether these
funds are advances under this Agreement or otherwise. Each Floor Plan Borrower
acknowledges and agrees that the Service Agreement relating to the Disbursement
Account may be canceled by the Floor Plan Agent at any time upon written notice
to the applicable Floor Plan Borrower, notwithstanding anything to the contrary
in the Service Agreement. A copy of the form of Service Agreement may be
attached to this Agreement by the Floor Plan Agent at any time a Service
Agreement is in effect between a Floor Plan Borrower and the Floor Plan Agent,
although the failure to attach it shall not affect its validity or the
effectiveness of this Agreement.
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SECTION IX.15 Further Assurances.
(a) The Company shall and shall cause each of the Borrowers to
the extent applicable to execute, acknowledge, deliver, and record or file such
further instruments, including, without limitation, further security agreements,
financing statements, and continuation statements, and do such further acts as
may be reasonably necessary, desirable, or proper to carry out more effectively
the purposes of this Agreement, including, without limitation, (i) causing any
additions, substitutions, replacements, or appurtenances to the Motor Vehicles
to be covered by and subject to the Liens created in this Agreement or the
Documents to which any Floor Plan Borrower is a party; and (ii) with respect to
any Motor Vehicles which are or are required to be subject to Liens created in
this Agreement or any other Loan Document to which any Floor Plan Borrower is a
party, execute, acknowledge, endorse, deliver, procure, and record or file any
document or instrument, including, without limitation, any financing statement,
certificate of title, manufacturer's statement of origin, certificate of origin,
and dealer reassignment of any of the foregoing which are evidences of ownership
of such Motor Vehicles, deemed advisable by the Agent or the Floor Plan Agent to
protect the Liens granted in this Agreement or the Loan Documents to which any
of them respectively is a party and against the rights or interests of third
persons, and will pay all reasonable costs connected with any of the foregoing;
(b) The Company shall cause all of its Subsidiaries which
become Subsidiaries after the Closing Date to execute the Addendum to Credit
Agreement and Notes, and if applicable, to execute such other Security Documents
as the Agent and/or the Floor Plan Agent shall reasonably request to establish
Liens on the assets of such Subsidiary consistent with those in place on the
Closing Date.
(c) In the event the Dealer Franchise Agreement or other
written agreements with Manufacturers to which any Borrower is subject shall
prohibit or restrict the Company or any Subsidiary of the Company from entering
into the Escrow and Security Agreement, the Company and/or such affected
Subsidiary shall not be required to be a party thereto.
SECTION IX.16 Permitted Acquisitions.
(a) Subject to the remaining provisions of this Section 9.16
applicable thereto and the requirements contained in the definition of Permitted
Acquisition, the Company may, from time to time after the Closing Date, effect
Permitted Acquisitions, as long as with respect thereto each of the following
conditions are satisfied:
(i) no Default or Event of Default is in
existence at the time of the consummation of such proposed
Acquisition or would exist after giving effect thereto, all
representations and warrants contained herein and in the other
Loan Documents shall be true and correct in all material
respects with the same effect as though such representations
and warranties were made on and as of the date of such
proposed Acquisition (both before and after giving effect
thereto), and no other
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agreement, contract or instrument to which any Borrower is a
party restricts such proposed Acquisition; and
(ii) the Company shall have given the Agent and
the Lenders at least 30 days prior written notice of any such
proposed Acquisition (each of such notices, a "Permitted
Acquisition Notice"), which notice shall contain all
information related to the Auto Dealer being acquired and the
proposed Acquisition as required in the form of Acquisition
Information worksheet attached hereto as Exhibit K, and such
additional information as the Agent shall reasonably request,
including, without limitation, delivery of the expert reports
(if any) prepared by accounting, environmental, and/or other
experts which the Company has obtained as the Agent shall
reasonably request, and, if requested by Agent, a true and
correct copy of the draft purchase agreement, letter of intent
or description of material terms or similar agreements
executed by the parties thereto in connection with such
proposed Acquisition.
(iii) INTENTIONALLY DELETED
(iv) (A) as soon as available but not less than
the earlier of three (3) days after the execution thereof, a
copy of the executed purchase agreement and all related
agreements, schedules and exhibits with respect to such
proposed Acquisition and (B) at the time of delivery of the
purchase agreement, certification from the Company as to the
purchase price for the acquisition (or a formula therefor) and
the estimated amount of all related costs, fees and expenses
and that, except as described, there are no other amounts
which will be payable in connection with the respective
proposed Acquisition;
(v) the Company shall have given the Agent and
the Lenders, at least ten (10) Business Days prior to the
closing date of the proposed Acquisition, a good faith
estimate made by the Company of its Consolidated Pro Forma
EBITDA and Consolidated Pro Forma Floor Plan Interest Expense,
the calculations for which, the Company shall have furnished
to the Agent together with audited statements from an auditor,
satisfactory to the Agent, supporting such calculations for
Pro Forma Floor Plan Interest Expense (except in the case of
an Acquisition, the total consideration exclusive of stock or
other equity consideration is $10,000,000 or less, in which
event audited statements shall not be required); and
(vi) INTENTIONALLY DELETED
(vii) INTENTIONALLY DELETED
(viii) prior to the consummation of the
respective proposed Acquisition, the Company shall furnish the
Agent and the Lenders an officer's certificate executed by the
chief financial officer of the Company, certifying as to
compliance with the
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requirements of the applicable preceding clauses (i) through
(vii), containing the calculations required in this Section
9.16(a). The consummation of each Permitted Acquisition shall
be deemed to be a representation and warranty by the Company
that all conditions thereto have been satisfied and that same
is permitted in accordance with the terms of this Agreement,
which representation and warranty shall be deemed to be a
representation and warranty for all purposes hereunder.
(ix) For each Permitted Acquisition involving the
acquisition or creation of a direct or indirect Subsidiary of
the Company, (i) not less than 100% of the capital stock or
other equity interest of such Subsidiary shall be directly
owned by the Company or another Borrower, and (ii) the
Acquisition will not have the effect of causing or requiring
any direct or indirect Subsidiary of the Company to be engaged
in the sale of new Motor Vehicles of a different Manufacturer
than the Manufacturer whose new Motor Vehicles such Subsidiary
was authorized to sell prior to the Acquisition.
(x) The Required Lenders shall have consented in
writing to the proposed Acquisition prior to the closing
thereof; provided, however, such consent shall be deemed to
have been granted if the Required Lenders shall not have given
written notice of consent or rejection of such consent to the
Agent within thirty (30) days after receipt by the Agent of
the Permitted Acquisition Notice.
(b) The Company shall cause each Subsidiary (other than Group
1 Reinsurance Ltd., any other Subsidiary formed for purposes of reinsurance, and
any dormant Subsidiaries having retained equity of less than $1,500) that is
created, or is otherwise acquired pursuant to a Permitted Acquisition to execute
and deliver an Addendum and updated Schedules of the Agreement, if applicable,
and the other applicable Loan Documents, with the documentation to be in form
and substance reasonably satisfactory to the Agent. Each such Subsidiary shall
also grant to the Agent, for the benefit of the Lenders, first priority
perfected security interests in all personal or movable property of such
Subsidiary subject only to Liens permitted by Section 10.2 acquired in
connection with the Permitted Acquisition, and such Subsidiary shall take all
actions requested by the Agent or the Required Lenders including, without
limitation, the obtaining of UCC-1's and the filing of UCC-1's in connection
with the granting of such security interests. All security interests required to
be granted pursuant to this Section 9.16(b) shall be granted pursuant to such
security documentation (which shall be substantially similar to the analogous
Security Documents already executed and satisfactory in form and substance to
the Agent) and shall (except as otherwise consented to by the Agent and the
Required Lenders) constitute valid and enforceable perfected security interests
prior to the rights of all third Persons and subject to no other Liens, except
Liens permitted under Section 10.2. The security documents and other instruments
related thereto shall be duly recorded or filed in such manner and in such
places as are required by law to establish, perfect, preserve and protect the
Liens, in favor of the Agent for the benefit of the Lenders, required to be
granted pursuant to such additional Security Documents and all taxes, fees and
other charges payable in connection therewith shall be paid in full by the
Company. At the time of the execution and delivery of such additional Security
Documents, the Company and the applicable Borrower shall
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cause to be delivered to the Agent such documents as may be reasonably requested
by the Agent to assure that this Section 9.16(b) has been complied with.
Notwithstanding the foregoing, the Company shall have a grace period of thirty
(30) days from the date the Permitted Acquisition is effected within which to
pay off the existing floor plan facility and all other actions required to be
taken by this Section 9.16(b) with respect to the additional Collateral shall be
completed no later than thirty (30) days after the date on which the Permitted
Acquisition is effected.
SECTION IX.17 Ford Borrower and GM Borrower Dividends. On or before the
last Business Day of each fiscal quarter of the Company, the Company shall cause
all GM Borrowers and Ford Borrowers to make cash transfers to the Company or to
their respective parent with a view toward making an ultimate and concurrent
cash transfers to the Company of all pre-tax profits in excess of working
capital reasonably required in the day to day operations of such Borrower or
such amounts as may be required pursuant to a Dealer Franchise Agreement or
other agreements with Manufacturers to which such Borrower is a party.
ARTICLE X
NEGATIVE COVENANTS
So long as this Agreement shall remain in effect or the principal of or
interest on any Note, the Swing Line Note, any Commitment Fees or any other
expense or amount payable hereunder shall be unpaid and until the Commitments of
all the Lenders shall expire or terminate, the Letter of Credit Obligations are
paid in full and all Drafting Agreements are terminated, the Company, as to
itself and as to all of the other Borrowers and each of the Borrowers other than
the Company, as to itself only covenants and agrees with the Agent, the Floor
Plan Agent, the Swing Line Bank and each Lender that:
SECTION X.1 Indebtedness. No Borrower will incur, create, assume or
suffer to exist any Indebtedness, except:
(a) The Notes, the Swing Line Note, and Indebtedness and
Obligations under this Agreement and the other Loan Documents;
(b) Indebtedness of any Borrower existing at the Closing Date
which is reflected in Schedule X hereto and all renewals and extensions thereof;
(c) Indebtedness created under leases which, in accordance
with GAAP, have been recorded and/or should have been recorded on the books of
the applicable Borrower as Capital Leases and Indebtedness which is permitted in
connection with the purchase of property, provided that the aggregate amount of
all Indebtedness permitted under this Section 10.1(c) is less than five percent
(5%) of Stockholders' Equity;
(d) INTENTIONALLY DELETED
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(e) Subordinated Indebtedness;
(f) accounts payable (for the deferred purchase price of
Property or services) from time to time incurred in the ordinary course of
business and which are not in excess of ninety (90) days past the invoice or
billing date;
(g) Non-Recourse Real Estate Debt and any Guaranties by the
Company of such Indebtedness;
(h) INTENTIONALLY DELETED
(i) Indebtedness of any Subsidiary of the Company in existence
(but not incurred or created in connection with such acquisition) on the date on
which such Subsidiary is acquired by the Company and for which Indebtedness
neither the Company nor any of its other Subsidiaries has any obligation and
with respect to which Indebtedness, none of the properties of the Company or any
of its other Subsidiaries is bound;
(j) Indebtedness secured by Liens upon any property hereafter
acquired by the Company or any of its Subsidiary to secure Indebtedness in
existence on the date of such acquisition (but not incurred or created in
connection with such acquisition), which Indebtedness is assumed by such Person
simultaneously with such acquisition, which Liens extend only to such Property
so acquired and with respect to which Indebtedness neither the Company nor any
of its Subsidiaries (other than the acquiring Person) has any obligation;
(k) Indebtedness owed by the Company or any of its
Subsidiaries to the Company or to any other Subsidiary; provided, however,
Indebtedness of the GM Borrowers and Ford Borrowers owed to the Company or to
any of its other Subsidiaries shall not exceed an amount required to be in
compliance with capital maintenance requirements pursuant to the Dealer
Franchise Agreement of any GM Borrower or any Ford Borrower, as applicable, or
such working capital as may be required from time to time in the ordinary course
of business;
(l) any Retail Loan Guaranties; provided that the sum of (i)
the aggregate principal amount of all Retail Loan Guaranties plus (ii)
Investments in seller financed notes in connection with Motor Vehicles shall not
exceed twenty percent (20%) of Stockholders' Equity; and
(m) Indebtedness arising under any Service Agreement as such
term is defined in Section 9.14.
SECTION X.2 Liens. No Borrower will incur, create, assume or permit to
exist any Lien on any of its property or assets, whether owned at the date
hereof or hereafter acquired, or assign or convey any rights to or security
interests in any future revenues, except:
(a) Liens securing payment of the Obligations;
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(b) (i) Liens securing Indebtedness permitted by Sections
10.1(c), but only on the property subject to such Capital Lease or
purchase-money arrangement, or (ii) securing Indebtedness permitted by Sections
10.1(i), (j) and (k);
(c) Liens referred to in Section 7.16;
(d) Liens securing Non-Recourse Real Estate Debt;
(e) extensions, renewals and replacements of Liens referred to
in paragraphs (a) through (d) of this Section 10.2 provided, that any such
extension, renewal or replacement Lien shall be limited to the property or
assets covered by the Lien extended, renewed or replaced and that the
Indebtedness secured by any such extension, renewal or replacement lien shall be
in an amount not greater than the amount of the Indebtedness secured by the Lien
extended, renewed or replaced; and
(f) INTENTIONALLY DELETED
(g) Liens existing under Qualified Sale/Leaseback Transaction,
but only on the Property subject of such transaction.
SECTION X.3 Consolidations and Mergers. No Borrower shall merge,
consolidate with or into, or convey, transfer, lease or otherwise dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to or in favor of
any Person, except:
(a) any of its Subsidiaries may merge with the Company,
provided that the Company shall be the continuing or surviving corporation, or
with any one or more such Subsidiaries, provided that if any such transaction
shall be between Subsidiaries, one of which is a Wholly-Owned Subsidiary and one
of its Subsidiaries which is not a Wholly-Owned Subsidiary, the Wholly-Owned
Subsidiary shall be the continuing or surviving corporation;
(b) any Subsidiary of the Company may sell all or
substantially all of its assets (upon voluntary liquidation or otherwise) to the
Company or a Wholly-Owned Subsidiary); and
(c) any Subsidiary of the Company or the Company may merge or
consolidate with another Person; if (x) the Company or such Subsidiary involved
in the merger or the consolidation is the surviving corporation or the Person
who is the survivor becomes a Wholly-Owned Subsidiary as a result thereof, and
(y) immediately prior to and after giving effect to such merger or
consolidation, there exists no Default or Event of Default.
SECTION X.4 Disposition of Assets. Each Borrower agrees that it shall
not permit any Disposition (whether in one or a series of transactions) of any
property or assets (including Accounts,
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notes receivable, and/or chattel paper, with or without recourse) or enter into
any agreement so to do, except:
(a) Dispositions of Motor Vehicles and dispositions of other
inventory in the ordinary course of business;
(b) Dispositions of assets, properties or businesses by the
Company or any of its Subsidiaries or Affiliates to any other Subsidiary or to
the Company provided, however, other than dispositions to newly created
Subsidiaries which become Borrowers for purposes of complying with Dealer
Franchise Agreements, any such disposition made to a Ford Borrower or a GM
Borrower shall be made on an arms-length basis for fair market value for cash
and only in the ordinary course of business.
(c) Dispositions of property in connection with any
consolidation or merger permitted by Schedule XIII hereof;
(d) Dispositions of the property described in Schedule XIV
attached hereto;
(e) Dispositions of equipment and other property which is
obsolete, worn out or no longer used or useful in such Person's business, all in
the ordinary course of business;
(f) Dispositions occurring as the result of a casualty event,
condemnation or expropriation; and
(g) Dispositions of any property, assets (including capital
stock of its Subsidiaries and Affiliates) or businesses of the Company not
otherwise permitted by clauses (a) through (g) of this Section 10.4; provided,
that the aggregate book value of all such property, assets or businesses sold,
leased or otherwise disposed of during the term of this Agreement shall not at
any time exceed the greater of (i) Five Million Dollars ($5,000,000) or (ii) ten
percent (10%) of the total book value of the assets of the Company and each of
its Subsidiaries, (determined on a consolidated basis in accordance with GAAP,
as of the end of the immediately preceding fiscal quarter), and provided,
further, that for any such property, assets or business other than capital stock
that is sold, leased or otherwise disposed of, for purposes of determining
compliance with this Section 10.4, the value of any such property, asset or
business shall be equal to the book value of such property, asset or business as
of the date of such Disposition; and provided, further, that for purposes of
determining compliance with this Section 10.4, the value of any capital stock
sold or disposed of shall be determined by multiplying the number of shares of
such capital stock sold by the net book value per share of such capital stock;
and provided, further, that this Section 10.4 does not authorize Disposition of
any Accounts, notes receivable and/or Chattel Paper with or without recourse;
and
(h) Dispositions pursuant to Qualified Sale/Leaseback
Transactions.
SECTION X.5 Investments. No Borrower will make or permit to exist any
Investment in any Person, except for:
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(a) Permitted Acquisitions;
(b) extensions of credit in the nature of Accounts receivable
or notes receivable and/or chattel paper arising from the sale of goods and
services in the ordinary course of business;
(c) shares of stock, obligations or other securities received
in settlement of claims arising in the ordinary course of business;
(d) Investments in securities, maturing within two (2) years
and issued or fully guaranteed or insured by the United States of America or any
agency thereof;
(e) Investments in commercial paper, maturing in two hundred
seventy (270) days or less from the date of issuance, rated in the highest or
second highest grade by a nationally recognized credit rating agency;
(f) Investments in United States Dollar denominated and
Eurodollar denominated time deposits, maturing within two (2) years from the
date of such Investment and issued by a bank or trust company having capital,
surplus and undivided profits aggregating at least One Hundred Million Dollars
($100,000,000) and whose unsecured long-term debt is rated in the highest or
second highest grade by a nationally recognized credit rating agency;
(g) Investments outstanding on the date hereof in Subsidiaries
by the Company and its Subsidiaries;
(h) Investments in negotiable instruments held by Comerica
Securities, Inc. which are acceptable to the Floor Plan Agent not to exceed the
amounts required to be invested pursuant to Section 2.3(i);
(i) INTENTIONALLY DELETED
(j) Investments in capital assets, subject to the limitations
set forth in Section 10.11; and
(k) Investments in seller financed notes in connection with
Motor Vehicles; provided that the sum of (i) the aggregate amount of all seller
financed notes of the Borrowers in connection with Motor Vehicles plus (ii) the
aggregate amount of all Retail Loan Guaranties, shall not exceed twenty percent
(20%) of Stockholders' Equity.
SECTION X.6 Transactions with Affiliates. No Borrower will enter into
any transaction with any Affiliate except in the ordinary course of business and
upon fair and reasonable terms no less favorable than the applicable Borrower
could obtain or could become entitled to in an arm's-length transaction with a
Person which was not an Affiliate.
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SECTION X.7 Other Agreements. No Borrower will enter into any agreement
containing any provision which would be violated or breached by such Borrower's
performance of its Obligations hereunder or under any instrument or document
delivered or to be delivered by the Borrowers hereunder or in connection
herewith if the effect of such violation or breach could reasonably be expected
to have a Material Adverse Effect.
SECTION X.8 Fiscal Year; Accounting. No Borrower will change its fiscal
year without prior notification to the Agent or change its method of accounting
(other than immaterial changes and methods and changes authorized by GAAP).
SECTION X.9 Credit Standards. No Borrower will modify in any material
way and which is inconsistent with normal industry practice, the credit
standards and procedures, the collection policies or the loss recognition
procedures with respect to the creation or collection of Accounts, notes
received and/or chattel paper.
SECTION X.10 Pension Plans. No Borrower will permit any condition to
exist in connection with any Plan which might constitute grounds for the PBGC to
institute proceedings to have such Plan terminated or a trustee appointed to
administer such Plan, or engage in, or permit to exist or occur any other
condition, event or transaction with respect to any Plan which could reasonably
be expected to have Material Adverse Effect.
SECTION X.11 Capital Expenditures. The Borrowers will not make
expenditures for capital or fixed assets or improvements in any consecutive
twelve (12) month period in an aggregate amount in excess of the aggregate
amount equal to ten percent (10%) of Stockholders' Equity as at the most recent
fiscal year end of the Company. However, if a capital or fixed asset or
improvement is sold by the Company, then the aggregate amount of the capital
expenditures the Company is permitted to make shall be increased by the amount
of proceeds received from the sale of such Property.
SECTION X.12 Stockholders' Equity. The Company will not at any time
permit its Stockholders' Equity to be less than an amount equal to the sum of
(x) $85,000,000 plus (y) seventy-five percent (75%) of Consolidated Net Income,
computed on a cumulative basis, for the period beginning on December 31, 1997
and ending on the date of determination (provided that no negative adjustment
will be made in the event that Consolidated Net Income is a deficit figure for
such period), plus (z) one hundred percent (100%) of the net proceeds (cash or
non-cash) realized from the issuance of any equity securities by the Company (or
other capital contributions made to the Company) after December 31, 1997.
SECTION X.13 Restricted Payments. Each Borrower agrees that it shall
not declare or make any Restricted Payment, except that any Borrower may make
the following Restricted Payments provided that immediately prior to and after
giving effect to the declaration of any dividend, and immediately prior to and
after giving effect to the payment of any Restricted Payment, there exists no
Default or Event of Default:
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(a) any Borrower may declare and make dividend payments or
other distributions payable solely in its capital stock;
(b) any Subsidiaries of the Company may declare and make
Restricted Payments to the Company or such Subsidiary's parent company for the
purpose of such parent company making a Restricted Payment to the Company;
(c) the Company may declare and pay cash dividends on its
capital stock, provided (i) no Default or Event of Default has occurred, is
continuing or would be created thereby and (ii) that the aggregate cash
dividends paid by the Company shall not exceed an amount equal to thirty-three
and three-one-hundredths percent (33.3%) of the aggregate Consolidated Net
Income for the period commencing on December 31, 1997 and ending on the date of
determination taken as a single accounting period; and
(d) the Company may purchase shares of its capital stock (i)
to sell to employees of the Company pursuant to a Company sponsored employee
stock purchase plan, provided that such sales price is not less than 85% of the
Company's cost, and (ii) from directors, officers and employees, provided that
the aggregate amount of such purchases under this clause (ii) does not exceed
$1,000,000 in any consecutive twelve (12) month period.
SECTION X.14 Fixed Charge Coverage Ratio. The Company will not permit
(as of the end of any fiscal quarter) its Fixed Charge Coverage Ratio to be less
than 1.25 to 1, such ratio to be calculated as of the end of each fiscal quarter
of the Company based upon the four fiscal quarters immediately preceding such
date of determination.
SECTION X.15 Interest Coverage Ratio. The Company will not permit (as
of the end of any fiscal quarter) its Interest Coverage Ratio to be less than
2.50 to 1, such ratio to be calculated as of the end of each fiscal quarter of
the Company based upon the four fiscal quarters immediately preceding such date
of determination.
SECTION X.16 Leverage Ratio and Total Leverage Ratio. The Company shall
not, at any time permit (a) its Leverage Ratio to be greater than 2.0 to 1 and
(b) its Total Leverage Ratio to be greater than 3.0 to 1.
SECTION X.17 Current Ratio. The Company shall not, at any time, permit
its Current Ratio to be less than 1.05 to 1.
SECTION X.18 INTENTIONALLY DELETED
SECTION X.19 Alternative Floor Plan Financing. Notwithstanding the
provisions of Section 10.1 and 10.2, the existence of Indebtedness owed to any
lender providing floor plan financing to the Borrowers (other than Borrowers who
as of the Closing Date were Floor Plan Borrowers) other than the Lenders as of
the Closing Date and the Liens securing such Indebtedness shall not be
prohibited if at any time the Company provides written notice to the Agent that
(i) the conditions precedent for imposition of the Reserve Commitment exist as
of the date of such notice,
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and requesting therein a reasonable increase in the Floor Plan Loan Commitment,
and the Lenders shall not, within twenty (20) Business Days after the date of
such notice, have provided for such increase in the Floor Plan Loan Commitment,
or (ii) in connection with a Permitted Acquisition, the Floor Plan Loan
Commitment will not, in the reasonable determination of the Company, be adequate
for the floor plan funding requirements of the Auto Dealer(s) to be acquired and
the Lenders shall not, within twenty (20) Business Days after the date of such
notice have agreed to increase the Floor Plan Loan Commitments in the amounts
reasonably requested by the Company upon closing of the acquisition of such Auto
Dealers.
ARTICLE XI
EVENTS OF DEFAULT
SECTION XI.1 Events of Default. In case of the happening of any of the
following events (herein called "Events of Default"):
(a) any representation or warranty made or deemed made in or
in connection with this Agreement, the Notes, the Swing Line Note, any of the
Loan Documents or any of the Borrowings hereunder or in any report, certificate,
financial statement or other instrument furnished in connection with this
Agreement or the execution and delivery of the Notes, the Swing Line Note or any
of the Loan Documents or the making of any of the Borrowings hereunder shall
prove to have been false or misleading in any material respect when made or
deemed made;
(b) Default shall be made in the payment of any principal of
any Loan when and as the same shall become due and payable pursuant to the terms
of this Agreement, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise;
(c) Default shall be made in the payment of any interest on
any Loan or any Commitment Fees or any other amount due under this Agreement,
when and as the same shall become due and payable which shall remain unremedied
for a period of five (5) days;
(d) Default shall be made in the due observance or performance
of any covenant, condition or agreement contained in Sections 6.3 [Risk
Participations, Drawings and Reimbursements], 9.1 [Existence], 9.3 [Insurance],
9.5[ Financial Statements; Reports], 9.6 [Litigation and Other Notices], 9.8
[Books, Records and Access], 9.10 [Nature of Business], 9.13 [Demonstrators and
Rental Motor Vehicles] or in Article X [Negative Covenants];
(e) except as provided in Sections 11.1(a) through (d),
inclusive, Default shall be made in the due observance or performance of any
other covenant, condition or agreement to be observed or performed pursuant to
this Agreement or any of the Loan Documents and such Default shall continue
unremedied for thirty (30) days after the earlier to occur of (i) any Borrower
obtaining knowledge thereof or (ii) written notice thereof having been given to
the Company;
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(f) any Borrower shall (i) voluntarily commence any proceeding
or file any petition seeking relief under Title 11 of the United States Code or
any other federal or state bankruptcy, insolvency, liquidation or similar law,
(ii) consent to the institution of, or fail to contravene in a timely and
appropriate manner, any such proceeding or the filing of any such petition,
(iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator or similar official for such Borrower or for a substantial part of
such Borrower's property or assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors, (vi) become unable, admit in
writing its inability or fail generally to pay its debts as they become due or
(vii) take any corporate or other action for the purpose of effecting any of the
foregoing;
(g) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent jurisdiction seeking
(i) relief in respect of any Borrower, or of a substantial part of the property
or assets of any Borrower, under Title 11 of the United States Code or any other
federal or state bankruptcy, insolvency, receivership or similar law, (ii) the
appointment of a receiver, trustee, custodian, sequestrator or similar official
for any Borrower or for a substantial part of the property of any Borrower or
(iii) the winding-up or liquidation of any Borrower; and such proceeding or
petition shall continue undismissed for sixty (60) days or an order or decree
approving or ordering any of the foregoing shall continue unstayed and in effect
for sixty (60) days;
(h) default or defaults (other than defaults in the payment of
principal or interest) shall be made with respect to any Indebtedness of any
Borrower, if the total amount of such Indebtedness in default exceeds in the
aggregate, an amount equal to Two Million Dollars ($2,000,000) and if the effect
of any such default or defaults shall be to accelerate, or to permit the holder
or obligee of any such Indebtedness (or any trustee on behalf of such holder or
obligee) to accelerate (with or without notice or lapse of time or both), the
maturity of any such Indebtedness; or any payment of principal or interest,
regardless of amount, on any Indebtedness of the Borrowers which exceeds in the
aggregate, an amount equal to Two Million Dollars ($2,000,000) shall not be paid
when due, whether at maturity, by acceleration or otherwise (after giving effect
to any period of grace as specified in the instrument evidencing or governing
such Indebtedness);
(i) a Reportable Event or Reportable Events shall have
occurred with respect to any Plan or Plans that reasonably could be expected to
result in a Material Adverse Effect.
(j) there shall be entered against the Company or any of its
Subsidiaries one or more judgments or decrees in excess of Five Million Dollars
($5,000,000) in the aggregate at any one time outstanding for the Company and
all such Subsidiaries and all such judgments or decrees in the amount of such
excess shall not have been vacated, discharged, stayed or bonded pending appeal
within sixty (60) days from the entry thereof, excluding those judgments or
decrees for and to the extent which the Company or any such Subsidiary is
insured and with respect to which the insurer has assumed responsibility in
writing or for and to the extent which the Company or any such Subsidiary is
otherwise indemnified if the terms of such indemnification are satisfactory to
the Required Lenders;
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(k) there shall occur any material loss or change to any
Dealer Franchise Agreement between any Borrower and a Manufacturer, which has a
Material Adverse Effect;
(l) there occurs any Material Adverse Effect;
(m) any of the Loan Documents shall cease to be legal, valid
and binding agreements enforceable against the Person executing the same in
accordance with the respective terms thereof except as permitted by the terms
hereof or thereof shall in any way be terminated or become or be declared
ineffective or inoperative or shall in any way whatsoever cease to give or
provide the respective Liens, security interests, rights, titles, interests,
remedies, powers or privileges intended to be created thereby;
(n) an audit performed by the Floor Plan Agent pursuant to the
provisions of Section 9.12(a), reveals that Motor Vehicles have, for a period of
thirty consecutive (30) days been Out of Balance in an amount equal to or
greater than the Out of Balance Amount and none of the Floor Plan Borrowers has
delivered sufficient funds to restore Excess/Payments in Process to an amount
not less than the Out of Balance Amount;
(o) an audit performed by the Floor Plan Agent pursuant to the
provisions of Section 9.12(a) identifies any specific Motor Vehicle by vehicle
identification number as an exception to the payment requirements of Section
2.5, and the Loan advanced to fund such Motor Vehicle has not been repaid within
thirty (30) days (except in the case of Fleet Motor Vehicles, which shall be
sixty (60) days) of such audit and the aggregate amount of all such unpaid Loans
exceeds $1MM; or
(p) a Change of Control occurs;
then, and in any such event (other than an event with respect to the Company
described in paragraph (f) or (g) above), and at any time thereafter during the
continuance of such event, (i) the Agent may, and at the request of the Required
Lenders shall, by written or telegraphic notice to the Company, take any of the
following actions at the same or different times: (x) terminate forthwith the
Commitments of the Lenders hereunder (if not theretofore terminated) and any
such termination shall automatically constitute a termination of the Swing Line
Commitment, (y) declare the Notes then outstanding to be forthwith due and
payable and any such declaration shall automatically constitute a declaration
that the Swing Line Note is due and payable, whereupon the principal of the
Notes, and the Swing Line Note, together with accrued and unpaid interest
thereon and any unpaid accrued Commitment Fees and all other liabilities of the
Borrowers accrued hereunder, shall become forthwith due and payable both as to
principal and interest, without presentment, demand, protest, notice of protest,
notice of intent to accelerate, notice of acceleration or any other notice of
any kind, all of which are hereby expressly waived by the Borrowers, anything
contained herein or in any Note, the Swing Line Note or other Loan Document to
the contrary notwithstanding, or (z) pursue and enforce any of the rights and
remedies of the Agent on behalf of the Lenders as provided in any of the Loan
Documents or as otherwise provided in the UCC or other applicable law and (ii)
the Floor Plan Agent in its sole discretion may, and at the request of the
Required Lenders shall (and, to the
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extent the Commitments have been terminated, such request shall be deemed to
have been made), suspend and terminate all Drafting Agreements; and in any event
with respect to a Borrower described in paragraph (f) or (g) above, the
Commitments of the Lenders shall automatically terminate (if not theretofore
terminated) and any such termination shall automatically constitute a
termination of the Swing Line Commitment, and the Notes and the Swing Line Note
shall automatically become due and payable, both as to principal and interest,
without presentment, demand, protest, notice of intent to accelerate, notice of
acceleration or other notice of any kind, all of which are hereby expressly
waived by the Borrowers, anything contained herein or in any Note, the Swing
Line Note or other Loan Document to the contrary notwithstanding and the Company
and the other Borrowers shall immediately deliver cash collateral to the Agent
in such amounts as are acceptable to the Agent to be held by the Agent, for the
benefit of the Swing Line Bank and the Lenders as Collateral for the payment and
performance of Drafting Agreements until all such Drafting Agreements are
terminated according to their terms.
ARTICLE XII
THE AGENT AND FLOOR PLAN AGENT
SECTION XII.1 Authorization and Action of the Agent; Rights and Duties
Regarding Collateral.
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(a) In order to expedite the various transactions contemplated
by this Agreement, each Lender, the Floor Plan Agent and the Swing Line Bank
hereby irrevocably appoints and authorizes Chase to act as Agent on its behalf.
Each of the Lenders, the Floor Plan Agent and the Swing Line Bank and each
subsequent holder of any Note or the Swing Line Note by its acceptance thereof,
hereby irrevocably authorizes and directs the Agent to take such action on its
behalf and to exercise such powers hereunder as are specifically delegated to or
required of the Agent by the terms and provisions hereof, together with such
powers as are reasonably incidental thereto. The Agent may perform any of its
duties hereunder by or through its agents and employees. The duties of the Agent
shall be mechanical and administrative in nature; the Agent shall not have by
reason of this Agreement or any other Loan Document a fiduciary relationship in
respect of any Lender, the Floor Plan Agent or the Swing Line Bank; and nothing
in this Agreement or any other Loan Document, expressed or implied, is intended
to, or shall be so construed as to, impose upon the Agent any obligations in
respect of this Agreement or any other Loan Document except as expressly set
forth herein or therein. The Agent is hereby expressly authorized on behalf of
the Lenders, the Floor Plan Agent and the Swing Line Bank, without hereby
limiting any implied authority, (i) to receive on behalf of each of the Lenders
any payment of principal of or interest on the Notes outstanding hereunder and
all other amounts accrued hereunder paid to the Agent, and promptly to
distribute to each Lender its proper share of all payments so received; (ii) to
give notice within a reasonable time on behalf of each of the Lenders and the
Swing Line Bank to the Borrowers of any Default or Event of Default specified in
this Agreement of which the Agent has actual knowledge as provided in Section
12.7; (iii) to distribute to each Lender and the Swing Line Bank copies of all
notices, agreements and other material as provided for in this Agreement as
received by the Agent; (iv) to distribute to the Borrowers any and all requests,
demands and approvals received by the Agent or from the Lenders, and (v) to
distribute and receive all notices, agreements and other material as provided in
this Agreement with respect to Floor Plan Loans and to deal with the Floor Plan
Agent to the fullest extent required or contemplated by the terms of their
Agreement or any other Loan Document. As to any matters not expressly provided
for by this Agreement, the Notes, the Swing Line Note or the other Loan
Documents (including enforcement or collection of the Notes or the Swing Line
Note), the Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes, the Swing Line Note and the Loans, the Floor Plan
Agent and the Swing Line Bank; provided, however, that the Agent shall not be
required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or applicable law.
(b) The Agent shall hold all of the Collateral along with all
payments and proceeds arising therefrom, for the benefit of all Lenders and the
Swing Line Bank as security for the payment of all the Obligations. Upon payment
in full of all the Obligations, the Agent shall release all of the Collateral to
the Borrowers. Except as otherwise expressly provided for in Section 13.5, the
Agent, in its own name or in the name of the Borrowers, may enforce any of the
Security Documents or the security therefor by any mode provided under the Loan
Documents or by applicable law, and may collect, receive and receipt for all
proceeds receivable on account of the Collateral.
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(c) To the extent that the Collateral includes notes or other
instruments evidencing any monetary obligation to, or interest of any Borrower,
such Borrowers shall, if requested by the Agent, deliver to the Agent letters,
executed by such Borrower and approved by counsel for the Agent, notifying the
obligors to make payments directly to the Agent, such letters to be held by the
Agent and sent to such obligors at its discretion in accordance with Section
12.1(d) below. All payments and proceeds of every kind from the Collateral, when
directly received by the Agent pursuant to Section 12.1(d) (whether from
payments on or with respect to the Collateral, from foreclosure and sale to
third parties, from sale of Collateral subsequent to a foreclosure at which the
Agent or another Lender was the purchaser, or otherwise) shall be held by it as
a part of the Collateral and, except as otherwise expressly provided
hereinafter, shall be applied to the Obligations in the manner set forth in
Section 12.1(d).
(d) Upon the occurrence of an Event of Default, and pursuant
to the procedures among the Lenders set forth in Section 12.1(e), the Agent,
after giving written notice to the Borrowers and to all Lenders and the Swing
Line Bank of the action(s) to be taken, may at any time or times thereafter (i)
deliver the various letters required by Section 12.1(c) hereof and receive
directly, for the benefit of the Lenders and Swing Line Bank and for reduction
of the Obligations as provided hereafter in this Section 12.1(d), all payments
and proceeds related to the Collateral and/or (ii) sell, assign and deliver all
of the Collateral or any part thereof, or any substitution therefor or any
additions thereto as provided hereafter. Any such sale or assignment may be at
any broker's board or at any public or private sale, at the option of the Agent
or of any officer or representative acting on behalf of the Agent, without
advertisement or any notice to the Borrowers or any other Person except those
required by applicable law (the Borrowers hereby agreeing that ten (10) days'
notice constitutes "reasonable notice"); and each Lender (including the Agent),
its officers and assigns, may bid and become purchasers at any such sale, if
public, or at any broker's board if the Collateral is of a type customarily sold
in a recognized market or is of a type which is the subject of widely
distributed standard price quotations. Sales hereunder may be at such time or
times, place or places, for cash or credit, and upon such terms and conditions
as the Agent may determine in its sole discretion. Upon the completion of any
sale, the Agent shall execute all instruments of transfer necessary to vest in
the purchaser(s) title to the property sold, and shall deliver to such
purchaser(s) any of the property so sold which may be in the possession of the
Agent.
In the case of any sale of Collateral, the purchase money
proceeds and avails, and all other proceeds which then may be held or recovered
by the Agent or the Floor Plan Agent for the benefit of the Lenders and the
Swing Line Bank, shall be applied in the following order:
(i) First, to the payment of the reasonable costs
and expenses of such sale and of the collection or enforcement
of such Collateral, and of all reasonable expenses (including
attorneys' fees) and liabilities incurred and advances made by
the Lenders in connection therewith;
(ii) Second, to the payment of any amounts due to
Swing Line Bank in the form of Swing Line Overdraft Loans;
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(iii) Third, to the payment ratably of the
amounts due to the Lenders for principal of and interest on
all Floor Plan Loans other than Swing Line Overdraft Loans
then outstanding, without preference or priority of such
indebtedness owing to one Lender over another, or of principal
over interest, or of interest over principal; and
(iv) Fourth, to the payment ratably of the
amounts due to the Lenders for principal of and interest on
(x) all Acquisition Loans then outstanding, without preference
or priority of such indebtedness owing to one Lender over
another, or of principal over interest, or of interest over
principal, (y) all Obligations arising under any Hedging
Agreement existing on the Closing Date with respect to or
covering Loans under this Agreement in an aggregate amount for
all such covered Loans not to exceed at any time $75 Million
and (z) Obligations arising under any other Hedging Agreement
covering Loans under this Agreement; provided that the Lender
entering into such Hedging Agreement has delivered a written
request for approval of such Hedging Agreement to the Agent
and each of the Lenders and the Required Lenders approve such
Hedging Agreement (and the failure of any Lender to object in
writing to such request within five (5) business days of
receipt of such request shall be deemed approval) but
excluding for the purposes of this Section 12.1(d)(iv) all
Obligations arising under any Hedging Agreements which do not
meet the requirements of subclauses (y) or (z) above (the
"Excess Hedging Agreement Liability"); and
(v) Fifth, to the payment of Excess Hedging
Agreement Liability owing to any of the Lenders without
preference or priority of such indebtedness owing to one
Lender over another; and
(vi) Sixth, to the payment of the surplus, if
any, to the Borrowers, their successors or assigns, or to
whomsoever may be lawfully entitled to receive the same, or as
a court of competent jurisdiction may direct.
(e) After the occurrence and during the continuance of a
Default or an Event of Default, the Required Lenders shall meet to establish
written procedures to be taken by the Agent for the protection, collection and
enforcement of the Collateral. The Agent shall not act with respect to the
Collateral except in accordance with the written procedures as established by
the Required Lenders; however, if the Required Lenders fail to agree upon and
establish such procedures, and the exigency of the circumstances requires, the
Agent, in its sole discretion and in good faith, may (but is not required to)
take whatever action it deems necessary to protect and enforce the Collateral or
the rights of the Lenders and the Swing Line Bank under the Loan Documents. The
Borrowers shall acquire no rights or defenses under this Section 12.1(e).
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(f) No Lender or the Swing Line Bank may enforce, or demand
enforcement of, any rights or Liens with respect to the Collateral except upon
the terms and conditions elsewhere stated in this Agreement.
SECTION XII.2 Agent's Reliance, Etc.
(a) Neither the Agent nor any of its directors, officers,
agents or employees shall be liable for any action taken or omitted to be taken
by it or them under or in connection with this Agreement, the Notes, the Swing
Line Note or any of the other Loan Documents (i) with the consent or at the
request of the Required Lenders or (ii) in the absence of its or their own gross
negligence or willful misconduct (it being the express intention of the parties
hereto that the Agent and its directors, officers, agents and employees shall
have no liability for actions and omissions under this Section 12.2 resulting
from their sole ordinary or contributory negligence).
(b) Without limitation of the generality of the foregoing, the
Agent: (i) may treat the payee of each Note, the Swing Line Note and the
Obligations of each Borrower hereunder and the Swing Line Bank, respectively, as
the holder thereof until the Agent receives written notice of the assignment or
transfer thereof signed by such payee and in form satisfactory to the Agent;
(ii) may consult with legal counsel (including counsel for any Borrower),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (iii) makes
no warranty or representation to any Lender, the Swing Line Bank, or the Floor
Plan Agent and shall not be responsible to any Lender, the Swing Line Bank, or
the Floor Plan Agent for any statements, warranties or representations made in
or in connection with this Agreement, any Note, the Swing Line Note or any other
Loan Document; (iv) except as otherwise expressly provided herein, shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement, any Note, the Swing
Line Note or any other Loan Document or to inspect the property (including the
books and records) of any Borrower; (v) shall not be responsible to any Lender,
the Swing Line Bank or the Floor Plan Agent for the due execution, legality,
validity, enforceability, collectability, genuineness, sufficiency or value of
this Agreement, any Note, the Swing Line Note, any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto; (vi) shall
not be responsible to any Lender, the Swing Line Bank or the Floor Plan Agent
for the perfection or priority of any Lien securing the Loans; and (vii) shall
incur no liability under or in respect of this Agreement, any Note, the Swing
Line Note or any other Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telegram,
telecopier, cable or telex) reasonably believed by it to be genuine and signed
or sent by the proper party or parties.
SECTION XII.3 Agent and Affiliates; Chase and Affiliates. Without
limiting the right of any other Lender or the Swing Line Bank to engage in any
business transactions with any Borrower or any of its Affiliates, with respect
to their Commitments, the Loans, if any, made by them, the Notes, and the Swing
Line Note, if any, issued to them, Chase shall have the same rights and powers
under this Agreement, any Note, the Swing Line Note or any of the other Loan
Documents as any other Lender and may exercise the same as though it were not
the Agent; and the term "Lender" or
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"Lenders" shall, unless otherwise expressly indicated, include Chase in its
individual capacity. Chase and its Affiliates may be engaged in, or may
hereafter engage in, one or more loan, letter of credit, leasing or other
financing activities not the subject of the Loan Documents (collectively, the
"Other Financings") with any of Borrowers or any of their Affiliates, or may act
as trustee on behalf of, or depositary for, or otherwise engage in other
business transactions with any of the Borrowers or any of their Affiliates (all
Other Financings and other such business transactions being collectively, the
"Other Activities") with no responsibility to account therefor to the Lenders or
the Floor Plan Agent. Without limiting the rights and remedies of the Lenders,
the Swing Line Bank, or the Floor Plan Agent specifically set forth in the Loan
Documents, no other Lender, the Swing Line Bank, nor the Floor Plan Agent shall
have any interest in (a) any Other Activities, (b) any present or future
guarantee by or for the account of any Borrower not contemplated or included in
the Loan Documents, (c) any present or future offset exercised by the Agent in
respect of any such Other Activities, (d) any present or future property taken
as security for any such Other Activities or (e) any property now or hereafter
in the possession or control of the Agent which may be or become security for
the Obligations of any Borrower under the Loan Documents by reason of the
general description of indebtedness secured, or of property contained in any
other agreements, documents or instruments related to such Other Activities;
provided, however, that if any payment in respect of such guarantees or such
property or the proceeds thereof shall be applied to reduction of the
Obligations evidenced hereunder and by the Notes, then each Lender, the Swing
Line Bank and the Floor Plan Agent shall be entitled to share in such
application according to its equitable portion of such Obligations.
SECTION XII.4 Agent's Indemnity.
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(a) The Agent shall not be required to take any action
hereunder or to prosecute or defend any suit in respect of this Agreement, the
Notes, the Swing Line Note or any other Loan Document unless indemnified to the
Agent's satisfaction by the Lenders and the Swing Line Bank against loss, cost,
liability and expense. If any indemnity furnished to the Agent shall become
impaired, the Agent may call for additional indemnity and cease to do the acts
indemnified against until such additional indemnity is given. In addition, the
Lenders and the Swing Line Bank agree to indemnify the Agent (to the extent not
reimbursed by the Borrowers), ratably according to the respective aggregate
principal amounts of the Notes and the Swing Line Note then held by each of them
(or if no Notes are at the time outstanding, ratably according to the respective
Pro Rata Share of Total Commitments, or if no Commitments are outstanding, the
respective Pro Rata Share of Total Commitments immediately prior to the time the
Total Commitments ceased to be outstanding), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent (or either of them) in
any way relating to or arising out of this Agreement or any action taken or
omitted by the Agent under this Agreement, the Notes, the Swing Line Note and
the other Loan Documents (including any action taken or omitted under Article II
of this Agreement). Without limitation of the foregoing, each Lender and the
Swing Line Bank agrees to reimburse the Agent promptly upon demand for its
respective Pro Rata Share of the Total Commitments of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Agent in connection with the
preparation, execution, administration, or enforcement of, or legal advice in
respect of rights or responsibilities under, this Agreement, the Notes, the
Swing Line Note and the other Loan Documents to the extent that the Agent is not
reimbursed for such expenses by the Borrowers. The provisions of this Section
12.4 shall survive the termination of this Agreement, the payment of the Loans
and/or the assignment of any of the Notes and the Swing Line Note.
(b) Notwithstanding the foregoing, no Lender or the Swing Line
Bank shall be liable under this Section 12.4 to the Agent for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements due to the Agent resulting from the
Agent's gross negligence or willful misconduct. Each Lender and the Swing Line
Bank agrees, however, that it expressly intends, under this Section 12.4, to
indemnify the Agent ratably as aforesaid for all such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements arising out of or resulting from the Agent's sole ordinary or
contributory negligence.
SECTION XII.5 Lender Credit Decision. Each Lender and the Swing Line
Bank acknowledges that it has, independently and without reliance upon the
Agent, the Floor Plan Agent or any other Lender or the Swing Line Bank and based
on the financial statements most recently delivered under either referred to in
Section 7.5 or Section 9.5 and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender and the Swing Line Bank also acknowledges that it will,
independently and without reliance upon the Agent, the Floor Plan Agent or any
other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, the other Loan Documents, any
related agreement or any document furnished hereunder.
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SECTION XII.6 Successor Agent. Subject to the appointment and
acceptance of a successor Agent as provided herein, the Agent may resign at any
time by giving thirty (30) days written notice thereof to the Lenders, the Swing
Line Bank, the Floor Plan Agent and the Company. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent, subject to
the approval of the Company, which approval shall not be unreasonably withheld.
If no successor Agent shall have been so appointed by the Required Lenders,
approved by the Company and shall have accepted such appointment, all within
thirty (30) calendar days after the retiring Agent's giving of notice of
resignation, then the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent, which shall be a commercial bank organized or licensed under
the laws of the United States or of any state thereof and having a combined
capital and surplus of at least Five Hundred Million Dollars ($500,000,000).
Upon the acceptance of any appointment as Agent hereunder and under the Notes by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement and the Notes. After any retiring Agent's resignation as the
Agent hereunder and under the Notes, the provisions of this Article XII and
Section 13.4 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement and the Notes.
SECTION XII.7 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Agent shall have received notice from a Lender, the Swing
Line Bank, the Floor Plan Agent or the Borrowers referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default" or "notice of event of default," as applicable. If the Agent
receives such a notice, the Agent shall give notice thereof to the Lenders, the
Swing Line Bank and the Floor Plan Agent and, if such notice is received from a
Lender, the Swing Line Bank or the Floor Plan Agent, the Agent shall give notice
thereof to the other Lenders, the Swing Line Bank and the Company. The Agent
shall be entitled to take action or refrain from taking action with respect to
such Default or Event of Default as provided in Section 12.1 and Section 12.2.
SECTION XII.8 Authorization and Action of the Floor Plan Agent.
(a) In order to expedite the various transactions contemplated
by this Agreement, each Lender, the Swing Line Bank and the Agent hereby
irrevocably appoint and authorize Comerica Bank to act as Floor Plan Agent on
its behalf. Each of the Lenders, the Swing Line Bank and the Agent, and each
subsequent holder of any Note or the Swing Line Note by its acceptance thereof,
hereby irrevocably authorizes and directs the Floor Plan Agent to take such
action and to exercise such powers hereunder as are specifically delegated to or
required of the Floor Plan Agent by the terms and provisions hereof, together
with such powers as are reasonably incidental thereto. The Floor Plan Agent may
perform any of its duties hereunder by or through its agents and employees. The
duties of the Floor Plan Agent shall be mechanical and administrative in nature;
the Floor Plan Agent shall not have by reason of this Agreement or any other
Loan Document a fiduciary relationship in respect of any Lender, the Swing Line
Bank or the Agent; and nothing in this Agreement or any other Loan Document,
expressed or implied, is intended to, or shall
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be so construed as to, impose upon the Floor Plan Agent any obligations in
respect of this Agreement or any other Loan Document except as expressly set
forth herein or therein. The Floor Plan Agent is hereby expressly authorized on
behalf of the Lenders to (i) receive and distribute funds, (ii) to receive and
distribute all notices and agreements and other material and (iii) to take all
actions and perform such duties and make such determinations, all as provided in
this Agreement. As to any matters not expressly provided for by this Agreement
or any Loan Document, the Floor Plan Agent shall not be required to exercise any
discretion or take any action, but shall not be required to act or to refrain
from acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Required Lenders, and such instructions
shall be binding upon all Lenders, the Swing Line Bank, the Agent and all
holders of Notes and the Swing Line Note and the Loans and the Floor Plan Agent;
provided, however, that the Floor Plan Agent shall not be required to take any
action which exposes it to personal liability or which is contrary to this
Agreement or applicable law.
(b) To the extent that any proceeds of the Motor Vehicles
includes notes or other instruments evidencing any monetary obligation to, or
interest of, any Borrower, such Borrower shall deliver or cause to be delivered
to the Floor Plan Agent letters, executed by such Borrower and approved by
counsel for the Floor Plan Agent, notifying the obligors to make payments
directly to the Floor Plan Agent, such letters to be held by the Floor Plan
Agent and sent to such obligors at its discretion. All payments and proceeds of
every kind from such Motor Vehicles, when directly received by the Floor Plan
Agent (whether from payments on or with respect to proceeds of Motor Vehicles,
from foreclosure and sale to third parties, from sale of Motor Vehicles
subsequent to a foreclosure at which the Floor Plan Agent or another Lender was
the purchaser, or otherwise) shall be, except as otherwise expressly provided
hereinafter, applied to the Obligations in the manner set forth in Section
12.1(d).
SECTION XII.9 Floor Plan Agent's Reliance, Etc.
(a) Neither the Floor Plan Agent nor any of its directors,
officers, agents or employees shall be liable for any action taken or omitted to
be taken by it or them under or in connection with this Agreement (i) with the
consent or at the request of the Required Lenders acting by and through the
Agent or (ii) in the absence of its or their own gross negligence or willful
misconduct (it being the express intention of the parties hereto that the Floor
Plan Agent and its directors, officers, agents and employees shall have no
liability for actions and omissions under this Section 12.9 resulting from their
sole ordinary or contributory negligence).
(b) Without limitation of the generality of the foregoing, the
Floor Plan Agent: (i) may treat the Agent as Agent hereunder until the Floor
Plan Agent receives written notice of the appointment of a successor Agent as
provided in Section 12.6; (ii) may consult with legal counsel (including counsel
for the Borrowers), independent public accountants and other experts selected by
it and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (iii) makes no warranty or representation to any Lender, the Swing Line
Bank or the Agent and shall not be responsible to any Lender, the Swing Line
Bank or the Agent for any statements, warranties or representations made in or
in connection with this Agreement; (iv) except as otherwise expressly provided
herein, shall
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not have any duty to ascertain or to inquire as to the performance or observance
of any of the terms, covenants or conditions of this Agreement, or to inspect
the property (including the books and records) of any Borrower; (v) shall not be
responsible to any Lender, the Swing Line Bank or the Agent for the due
execution, legality, validity, enforceability, collectability, genuineness,
sufficiency or value of this Agreement, or any other instrument or document
furnished pursuant hereto or thereto; (vi) except as otherwise expressly
provided herein shall not be responsible to any Lender, the Swing Line Bank or
the Agent for the perfection or priority of any Lien securing the Loans; and
(vii) shall incur no liability under or in respect of this Agreement, by acting
upon any notice, consent, certificate or other instrument or writing (which may
be by telegram, telecopier, cable or telex) reasonably believed by it to be
genuine and signed or sent by the proper party or parties.
SECTION XII.10 Floor Plan Agent and Affiliates; Comerica Bank and
Affiliates. Without limiting the right of any other Lender, the Swing Line Bank
or the Agent to engage in any business transactions with any Borrower or any of
its Affiliates, with respect to their Commitments, the Loans, if any, made by
them and the Notes, if any, issued to them, Comerica Bank shall have the same
rights and powers under this Agreement, any Note, the Swing Line Note or any of
the other Loan Documents as any other Lender and may exercise the same as though
it were not the Floor Plan Agent; and the term "Lender" or "Lenders" shall,
unless otherwise expressly indicated, include Comerica Bank in its individual
capacity. Unless prohibited hereby, Comerica Bank and its Affiliates may be
engaged in, or may hereafter engage in, one or more Other Financings with the
Company, any other Borrower or any of their Affiliates, or may act as trustee on
behalf of, or depositary for, or otherwise engage in Other Activities with no
responsibility to account therefor to the Lenders or the Agent. Without limiting
the rights and remedies of the Lenders or the Agent specifically set forth in
the Loan Documents, no other Lender nor the Agent shall have any interest in (a)
any Other Activities, (b) any present or future guarantee by or for the account
of any of the Borrowers not contemplated or included in the Loan Documents, (c)
any present or future offset exercised by the Floor Plan Agent in respect of any
such Other Activities, (d) any present or future property taken as security for
any such Other Activities or (e) any property now or hereafter in the possession
or control of the Floor Plan Agent which may be or become security for the
Obligations of the Borrowers under the Loan Documents by reason of the general
description of indebtedness secured, or of property contained in any other
agreements, documents or instruments related to such Other Activities; provided,
however, that if any payment in respect of such guarantees or such property or
the proceeds thereof shall be applied to reduction of the Obligations evidenced
hereunder and by the Notes or the Swing Line Note, then each Lender and the
Swing Line Bank shall be entitled to share in such application according to its
equitable portion of such Obligations.
SECTION XII.11 Floor Plan Agent's Indemnity.
(a) The Floor Plan Agent shall not be required to take any
action hereunder or to prosecute or defend any suit in respect of this
Agreement, the Notes, the Swing Line Note, or any other Loan Document unless
indemnified to the Floor Plan Agent's satisfaction by the Lenders and the Swing
Line Bank, against loss, cost, liability and expense. If any indemnity furnished
to the Floor Plan Agent shall become impaired, it may call for additional
indemnity and cease to do the acts indemnified against until such additional
indemnity is given. In addition, the Lenders and the Swing
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Line Bank agree to indemnify the Floor Plan Agent (to the extent not reimbursed
by the Borrowers), ratably according to the respective aggregate principal
amounts of the Notes then held by each of them (or if no Notes are at the time
outstanding, ratably according to the respective Pro Rata Share of Total
Commitments, or if no Commitments are outstanding, the respective Pro Rata Share
of Total Commitments immediately prior to the time the Total Commitments ceased
to be outstanding), from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by, or asserted against the Floor Plan Agent in any way relating to or arising
out of this Agreement or any action taken or omitted by the Floor Plan Agent
under this Agreement, the Notes, the Swing Line Note and the other Loan
Documents (including action taken or omitted under Article II or Article IV of
this Agreement). Without limitation of the foregoing, each Lender and the Swing
Line Bank agrees to reimburse the Floor Plan Agent promptly upon demand for its
respective Pro Rata Share of the Total Commitments of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Floor Plan Agent in
connection with the preparation, execution, administration, or enforcement of,
or legal advice in respect of rights or responsibilities under, this Agreement,
the Notes, the Swing Line Note and the other Loan Documents to the extent that
the Floor Plan Agent is not reimbursed for such expenses by the Borrowers. The
provisions of this Section 12.11 shall survive the termination of this
Agreement, the payment of the Loans and/or the assignment of any of the Notes or
the Swing Line Note.
(b) Notwithstanding the foregoing, no Lender nor the Swing
Line Bank shall be liable under this Section 12.11 to the Floor Plan Agent for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements due to the Floor
Plan Agent resulting from the Floor Plan Agent's gross negligence or willful
misconduct. Each Lender and the Swing Line Bank agrees, however, that it
expressly intends, under this Section 12.11, to indemnify the Floor Plan Agent
ratably as aforesaid for all such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses and disbursements arising
out of or resulting from the Floor Plan Agent's sole ordinary or contributory
negligence.
SECTION XII.12 Lender Credit Decision. Each Lender acknowledges that it
has, independently and without reliance upon the Floor Plan Agent, the Agent or
any other Lender and based on the financial statements referred to in Section
7.5 and Section 9.5 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender and the Swing Line Bank also acknowledges that it will,
independently and without reliance upon the Floor Plan Agent, the Swing Line
Bank, the Agent or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its own decisions in
taking or not taking action under or based upon this Agreement, the other Loan
Documents, any related agreement or any document furnished hereunder.
SECTION XII.13 Successor Floor Plan Agent. Subject to the appointment
and acceptance of a successor Floor Plan Agent as provided herein, the Floor
Plan Agent may resign at any time by giving written thirty (30) days notice
thereof to the Lenders, the Agent and the Company. Prior to the effectiveness of
the termination of the existing Floor Plan Agent, the Floor Plan Agent shall
also be terminated as Swing Line Bank and all Swing Line Loans, Swing Line
Overdraft Loans
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outstanding as of such date and all amounts funded by the Floor Plan Agent
pursuant to Section 2.11 hereof shall be purchased by the Successor Floor Plan
Agent, and all of the obligations of the Floor Plan Agent pursuant to any
drafting agreements issued by the Floor Plan Agent pursuant to Section 2.8
hereof shall have been irrevocably assumed by the Successor Floor Plan Agent,
and the Successor Floor Plan Agent shall have agreed to indemnify the existing
Floor Plan Agent in connection with any costs, liabilities or obligations
arising out of, or in any way connected with, the transfer of such drafting
agreements to the Successor Floor Plan Agent. Upon any such resignation or
termination, the Required Lenders shall have the right to appoint a successor
Floor Plan Agent, subject to the approval of the Company, which approval shall
not be unreasonably withheld. If no successor Floor Plan Agent shall have been
so appointed by the Required Lenders, approved by the Company and shall have
accepted such appointment, all within thirty (30) calendar days after the
resignation or termination of the Floor Plan Agent, then the Agent shall, on
behalf of the Lenders, appoint a successor Floor Plan Agent, which shall be a
commercial bank organized or licensed under the laws of the United States or of
any state thereof and having a combined capital and surplus of at least Five
Hundred Million Dollars ($500,000,000). Upon the acceptance of any appointment
as Floor Plan Agent hereunder, such successor Floor Plan Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Floor Plan Agent, and the retiring Floor Plan Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Floor Plan Agent's resignation as the Floor Plan Agent hereunder, the
provisions of this Article XII and Section 13.4 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Floor Plan Agent
under this Agreement.
SECTION XII.14 Notice of Default. The Floor Plan Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Floor Plan Agent shall have received notice from a
Borrower, a Lender or the Swing Line Bank, stating that such Default or Event of
Default has occurred and stating that such notice is a "notice of default or
"notice of event of default", as applicable. If the Floor Plan Agent receives
such a notice, the Floor Plan Agent shall give notice thereof to the Lenders,
the Swing Line Bank and the Agent. If the Floor Plan Agent receives such a
notice, the Floor Plan Agent shall be entitled to take action or refrain from
taking action with respect to such Default or Event of Default as provided in
Sections 12.8 and 12.9.
SECTION XII.15 Documentation Agent; Co-Agent. None of the Lenders
identified on the facing page or signature pages of this Agreement as
Documentation Agent or Co-Agent shall have any right, power, obligation,
liability or responsibility or duty under this Agreement other than those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Lenders so identified shall have or be deemed to have any fiduciary relations
with any Lender. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders so identified in deciding to enter into this
Agreement or in taking any action hereunder.
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ARTICLE XIII
MISCELLANEOUS
SECTION XIII.1 Notices, Etc. The Agent, any Lender, or the holder of
any of the Notes or Loans, the Floor Plan Agent, and the Swing Line Bank giving
consent or notice or making any request of the Company or any of the other
Borrowers provided for hereunder, shall notify each Lender, the Floor Plan Agent
and the Agent thereof. In the event that the holder of any Note (including any
Lender) shall transfer such Note, it shall promptly so advise the Agent which
shall be entitled to assume conclusively that no transfer of any Note has been
made by any holder (including any Lender) unless and until the Agent receives
written notice to the contrary. All notices, consents, requests, approvals,
demands and other communications (collectively, "Communications") provided for
herein shall be in writing (including telecopy Communications) and mailed,
telecopied or delivered:
(a) if to the Company, at ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ #▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief Financial Officer (Telecopy No.
(▇▇▇) ▇▇▇-▇▇▇▇);
(b) if to the Borrowers, or any individual Borrower, at the
address of the Company specified in Section 13.1(a) above;
(c) if to the Agent, at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇-▇▇▇▇-▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention of ▇▇▇▇▇ ▇. Dolphin, Senior Vice President (Telecopy No.
(▇▇▇) ▇▇▇-▇▇▇▇) with a copy to Chase Securities, Inc., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇-▇▇▇▇-▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention of Manager, Syndications (Telecopy
No. (▇▇▇) ▇▇▇-▇▇▇▇);
(d) if to any Lender, as specified on the signature page for
such Lender hereto or, in the case of any Person who becomes a Lender after the
date hereof, as specified on the Assignment and Acceptance executed by such
Person or in the Administrative Questionnaire delivered by such Person or;
(e) in the case of any party hereto, such other address or
telecopy number as such party may hereafter specify for such purpose by notice
to the other parties;
(f) if to the Floor Plan Agent, at Comerica Bank National
Dealer Services, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention of ▇▇▇▇▇ ▇▇▇▇▇, (Telecopy No. 949-476-1222) with a copy to Comerica
Bank, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇ (Telecopy No. 313-222-9419).
All Communications shall, when mailed, telecopied or delivered, be effective
when (i) mailed by certified mail, return receipt requested to any party at its
address specified above, on the signature page hereof or on the signature page
of such Assignment and Acceptance (or other address designated by such party in
a Communication to the other parties hereto), or (ii) telecopied to any party to
the telecopy number set forth above, on the signature page hereof or on the
signature page
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of such Assignment and Acceptance (or other telecopy number designated by such
party in a Communication to the other parties hereto) and confirmed by a
transmission report verifying the correct telecopier number and number of pages
and that such transmission was well transmitted, or (iii) delivered personally
to any party at its address specified above, on the signature page hereof or on
the signature page of such Assignment and Acceptance (or other address
designated by such party in a Communication to the other parties hereto);
provided, however, Communications to the Agent pursuant to Article VI or Article
XI shall not be effective until received by the Agent.
SECTION XIII.2 Survival of Agreement. All covenants, agreements,
representations and warranties made by the Borrowers herein and in the other
Loan Documents and in the certificates or other instruments prepared or
delivered in connection with this Agreement shall be considered to have been
relied upon by the Lenders and shall survive the making by the Lenders of the
Loans and the execution and delivery to the Lenders of the Notes evidencing such
Loans and shall continue in full force and effect as long as the principal of or
any accrued interest on any Note or any Commitment Fees or any other fee or
amount payable under the Notes or this Agreement is outstanding and unpaid and
so long as the Commitments of the Lenders have not been terminated.
SECTION XIII.3 Successors and Assigns; Participations.
(a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the successors and
assigns of such party; and all covenants, promises and agreements by or on
behalf of the Borrowers, the Agent, the Floor Plan Agent or the Lenders that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns. Except as permitted by Section 10.3, no
Borrower may assign or transfer any of its rights or Obligations hereunder
without the prior written consent of all the Lenders.
(b) Each Lender may assign to one or more Eligible Assignees
all or a portion of its interests, rights and obligations under this Agreement
(including a portion of its Commitment and the same portion of the Loans at the
time owing to it and the Note held by it); provided, however, that (i) except in
the case of an assignment to a Lender or an Affiliate of a Lender, the Company
(except during the continuance of an Event of Default) and the Agent must give
their prior written consent by countersigning the Assignment and Acceptance
(which consent shall not be unreasonably withheld), (ii) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Lender's rights and obligations to this Agreement, and be pro rata between the
Acquisition Loan Commitment of such Lender and the Floor Plan Loan Commitment of
such Lender, (iii) the amount of the Commitment of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Agent) shall (A) be equal to
the entire amount of the Commitment of the assigning Lender or (B) if not equal
to the entire amount of the Commitment of the assigning Lender, in no event be
less than Five Million Dollars ($5,000,000) and shall be in an amount which is
an integral multiple of One Million Dollars ($1,000,000); provided, however, for
purposes of this Section 13.3(b)(iii)(B), that the retained Commitment of the
assigning Lender may not be less than Five Million Dollars ($5,000,000), (iv)
the parties to each such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register, an Assignment and Acceptance
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substantially in the form of Exhibit I hereto (an "Assignment and Acceptance"),
together with any Note subject to such assignment and the assignor shall pay a
processing and recordation fee of Three Thousand Dollars ($3,000) payable by the
Lender's assignor thereunder, and (v) the assignee shall deliver to the Agent an
Administrative Questionnaire. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be no later than five (5) Business Days
after the execution thereof unless otherwise agreed to by the assigning Lender,
the Eligible Assignee thereunder and the Agent, (x) the assignee thereunder
shall be a party hereto and under the other Loan Documents and, to the extent
provided in such Assignment and Acceptance, have the rights and obligations of a
Lender hereunder and under the other Loan Documents and (y) the Lender
thereunder shall, to the extent provided in such Assignment and Acceptance, be
released from its obligations under this Agreement.
(c) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty contained in Section 5.14 and that it is the legal
and beneficial owner of the interest being assigned thereby free and clear of
any adverse claim, such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement, any other Loan Document or any other instrument or document furnished
pursuant hereto; (ii) such assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any of
the Borrowers or the performance or observance by any of the Borrowers of any of
their Obligations under this Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto; (iii) such assignee
confirms that it has received a copy of this Agreement, together with copies of
the financial statements most recently delivered under either in Section 7.5 or
Section 9.5 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such Lender's assignor or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee confirms that it is an Eligible Assignee and
can make the representation contained in Section 5.14 and has, to the extent
required, complied with the covenants contained therein; (vi) such assignee
appoints and authorizes the Agent and the Floor Plan Agent to take such action
as agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Agent and the Floor Plan Agent by the terms hereof, together
with such powers as are reasonably incidental thereto; and (vii) such assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.
(d) The Agent shall maintain at its address referred to in
Section 13.1 a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders and the
Commitments of, and principal amount of the Loans owing to, each Lender from
time to time (the "Register"). The entries in the Register shall be conclusive,
in the absence of demonstrable error, and the Borrowers and the Lenders may
treat each Person whose
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name is recorded in the Register as a Lender hereunder for all purposes of this
Agreement and the Loan Documents. The Register shall be available for inspection
by the Borrowers or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an Eligible Assignee together with the Note subject
to such assignment, the processing and recordation fee referred to in paragraph
(b) above and, if required, the Company's written consent to such assignment,
the Agent shall (subject to the consent of the Company to such assignment, if
required), if such Assignment and Acceptance has been completed and is in the
form of Exhibit I, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Company and the Lenders. Within five (5) Business Days after
receipt of notice, the Company, at its own expense, shall execute and deliver
and shall cause each of the other Borrowers to execute and deliver to the Agent
in exchange for the surrendered Note a new Note to the order of such Eligible
Assignee in an amount equal to the assigning Lender's Commitment assumed by it
pursuant to such Assignment and Acceptance, and a new Note to the order of the
assigning Lender in an amount equal to the portion of its Commitment retained by
the assigning Lender hereunder. Such new Notes shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Note, shall be dated the effective date of such Assignment and Acceptance and
shall otherwise be in substantially the form of Exhibit C-1 or C-2 hereto, as
applicable. Each canceled Note shall be promptly returned to the Company.
(f) Each Lender may without the consent of any Borrower or the
Agent sell participations to one or more banks or other entities in all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans owing to it and the Note held by it);
provided, however, that (i) such Lender's obligations under this Agreement shall
remain unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, (iii) the participating
banks or other entities shall be entitled to the cost protection provisions and
Tax indemnities contained in Article V only to the same extent that the Lender
from which such participating bank or other entity acquired its participation
would be entitled to the benefit of such cost protection provisions and Tax
indemnities and (iv) the Borrowers, the Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole right to enforce the Obligations of any of the Borrowers
relating to the Loans and to approve any amendment, modification or waiver of
any provision of this Agreement (other than amendments, modifications or waivers
with respect to any fees payable hereunder or the amount of principal of or the
rate at which interest is payable on the Loans, or the dates fixed for payments
of principal of or interest on the Loans).
(g) Any Lender or participant may, in connection with any
assignment or participation or proposed assignment or participation pursuant to
this Section 13.3, disclose to the assignee or participant or proposed assignee
or participant, any information relating to any Borrower furnished to such
Lender by or on behalf of any of the Borrowers; provided that prior to any such
disclosure, each such assignee or participant or proposed assignee or
participant shall agree (subject
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to customary exceptions, including without limitation the provisions of Section
13.18) to preserve the confidentiality of any confidential information relating
to any Borrower received from such Lender.
(h) Anything in this Section 13.3 to the contrary
notwithstanding, any Lender may at any time, without the consent of any Borrower
or the Agent, assign and pledge all or any portion of its Commitment and the
Loans owing to it to any Federal Reserve Bank (and its transferees) as
collateral security pursuant to Regulation A of the Board and any Operating
Circular issued by such Federal Reserve Bank. No such assignment shall release
the assigning Lender from its obligations hereunder.
(i) All transfers of any interest in any Note hereunder shall
be in compliance with all federal and state securities laws, if applicable.
Notwithstanding the foregoing sentence, however, the parties to this Agreement
do not intend that any transfer under this Section 13.3 be construed as a
"purchase" or "sale" of a "security" within the meaning of any applicable
federal or state securities laws.
SECTION XIII.4 Expenses of the Lenders; Indemnity.
(a) The Borrowers agree to pay all reasonable out-of-pocket
expenses reasonably incurred by the Agent and the Floor Plan Agent in connection
with the preparation of this Agreement, the Notes and the other Loan Documents
or with any amendments, modifications or waivers of the provisions hereof
(whether or not the transactions hereby contemplated shall be consummated) or
reasonably incurred by the Agent, the Floor Plan Agent or any Lender in
connection with the enforcement or protection of their rights in connection with
this Agreement or with the Loans made or the Notes issued hereunder, including
the reasonable fees and disbursements of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ L.L.P., special counsel
for the Agents and ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP, special counsel for the Floor
Plan Agent, and, in connection with such enforcement or protection, the
reasonable fees and disbursements of other counsel for any Lender, including
allocated staff counsel costs for any Lender that elects to use the services of
staff counsel in lieu of outside counsel. The Borrowers agree to indemnify the
Lenders from and hold them harmless against any documentary taxes, assessments
or charges made by any Governmental Authority by reason of the execution and
delivery of this Agreement or any of the Notes or other Loan Documents.
(b) THE BORROWERS EACH AGREE TO INDEMNIFY THE AGENT, THE FLOOR
PLAN AGENT AND THE LENDERS AND THEIR AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES
AND AGENTS (EACH SUCH PERSON BEING CALLED AN "INDEMNITEE") AGAINST, AND TO HOLD
THE LENDERS AND SUCH OTHER INDEMNITEE HARMLESS FROM, ANY AND ALL LOSSES, CLAIMS,
DAMAGES, LIABILITIES AND RELATED EXPENSES, INCLUDING REASONABLE COUNSEL FEES AND
EXPENSES, INCURRED BY OR ASSERTED AGAINST ANY INDEMNITEE ARISING OUT OF, IN ANY
WAY CONNECTED WITH, OR AS A RESULT OF (I) THE EXECUTION AND DELIVERY OF THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS CONTEMPLATED HEREBY, THE PERFORMANCE BY
THE
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PARTIES HERETO AND THERETO OF THEIR RESPECTIVE OBLIGATIONS HEREUNDER AND
THEREUNDER (INCLUDING THE MAKING OF THE COMMITMENT OF EACH LENDER) AND
CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, (II) THE USE
OF PROCEEDS OF THE LOANS OR (III) ANY CLAIM, LITIGATION, INVESTIGATION OR
PROCEEDING RELATING TO ANY OF THE FOREGOING, WHETHER OR NOT ANY INDEMNITEE IS A
PARTY THERETO; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY LENDER, APPLY
TO ANY SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR RELATED EXPENSES THAT ARE
DETERMINED BY A COURT OF COMPETENT JURISDICTION BY FINAL AND NONAPPEALABLE
JUDGMENT TO HAVE RESULTED FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF
SUCH INDEMNITEE. THE BORROWERS AGREE, HOWEVER, THAT THEY EXPRESSLY INTEND TO
INDEMNIFY EACH INDEMNITEE FROM AND HOLD EACH OF THEM HARMLESS AGAINST ANY AND
ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES OR EXPENSES ARISING OUT OF THE ORDINARY
SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH INDEMNITEE, BUT NOT THE GROSS NEGLIGENCE
OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE OR TO ANY OF THE FOREGOING ARISING
SOLELY BY REASON OF CLAIMS BETWEEN THE LENDERS OR ANY LENDER AND THE AGENT OR
THE FLOOR PLAN AGENT.
(c) The provisions of this Section 13.4 shall remain operative
and in full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the invalidity or unenforceability of any term or
provision of this Agreement or any Note, or any investigation made by or on
behalf of any Lender. All amounts due under this Section 13.4 shall be payable
within ten (10) days following receipt by the Company of a detailed invoice or
statement setting forth in reasonable detail the basis of such claim and the
amounts so expended or lost or the amount of damages so incurred.
(d) No Indemnitee may settle any claim to be indemnified
without prior written notice to the Company; provided however, failure to
provide such prior written notice shall in no way affect the settlement of such
claims.
(e) In the case of any indemnification hereunder, the
Indemnitee shall give notice to the Company of any such claim or demand being
made against the Indemnitee and the Company may participate in such proceeding
at its own expense if legal counsel to the Company is acceptable to the Agent.
SECTION XIII.5 Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and the Swing Line Bank are hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Lender, the Swing Line Bank or any branch Subsidiary or
Affiliate thereof to or for the credit or the account of the Borrowers against
any of and all the Obligations of the Borrowers
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now or hereafter existing under this Agreement and the Note held by such Lender
and the Swing Line Bank, respectively, according to their respective rights as
otherwise provided herein, irrespective of whether or not such Lender shall have
made any demand under this Agreement or such Note and although such Obligations
may be unmatured. Each Lender and the Swing Line Bank agree promptly to notify
the Borrowers after any such setoff and application, but the failure to give
such notice shall not affect the validity of such setoff and application. The
rights of each Lender and the Swing Line Bank under this Section 13.5 are in
addition to other rights and remedies (including other rights of setoff) which
such Lender and the Swing Line Bank may have under applicable law.
SECTION XIII.6 Governing Law; Jurisdiction.
(a) This Agreement, the Notes, the other Loan Documents and
all other documents executed in connection herewith, shall be deemed to be
contracts and agreements executed by the Borrowers, the Agent, the Floor Plan
Agent and the Lenders under the laws of the State of Texas and of the United
States of America and for all purposes shall be governed by, and construed and
interpreted in accordance with, the laws of said state and of the United States
of America. Without limitation of the foregoing, nothing in this Agreement, the
Notes or the other Loan Documents shall be deemed to constitute a waiver of any
rights which any Lender may have under applicable federal legislation relating
to the amount of interest which such Lender may contract for, take, receive, or
charge in respect of any Loans, including any right to contract for, take,
receive, reserve and charge interest at the rate allowed by the law of the state
where such Lender is located. If and to the extent the laws of the State of
Texas are applicable for purposes of determining the Highest Lawful Rate, such
term shall mean the "weekly ceiling" from time to time in effect under Section
303 of the Texas Finance Code, as amended (the "Act"), or, if permitted by
applicable law and effective upon the giving of the notices required by the Act
(or effective upon any other date otherwise specified by applicable law), the
"monthly", "quarterly" or "annualized" ceiling from time to time in effect under
the Act, whichever Agent shall elect to substitute for the "weekly ceiling," and
vice versa, each such substitution to have the effect provided in the Act, and
Agent shall be entitled to make such election from time to time one or more
times and, without notice to Borrower, to leave any such substitute rate in
effect for subsequent periods in accordance with the Act. The provisions of
Chapter 346 of the Texas Finance Code, as amended, do not apply to this
Agreement or any Note issued hereunder.
(b) Each Borrower hereby irrevocably submits generally and
unconditionally for itself and in respect of its property to the non-exclusive
jurisdiction of any Texas state court, or any United States federal court,
sitting in the City of Houston or County of ▇▇▇▇▇▇, Texas, and to the
non-exclusive jurisdiction of any state or United States federal court sitting
in the state in which any of the Collateral is located, over any suit, action or
proceeding arising out of or relating to this Agreement or the Obligations. Each
Borrower hereby agrees and consents that, in addition to any methods of service
of process provided for under applicable law, all service of process in any such
suit, action or proceeding in any Texas state court, or any United States
federal court, sitting in the City of Houston or County of ▇▇▇▇▇▇, Texas may be
made by certified or registered mail, return receipt requested, directed to such
Borrower at its address stated in Section 13.1, or at a subsequent
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address of which Administrative Agent received actual notice from such Borrower
in accordance with this Agreement, and service so made shall be complete five
(5) days after the same shall have been so mailed.
SECTION XIII.7 Waivers; Amendments.
(a) No failure or delay of the Agent, the Floor Plan Agent or
any Lender in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Agent, the Floor Plan Agent and
the Lenders hereunder are cumulative and not exclusive of any rights or remedies
which they would otherwise have. No waiver of any provision of this Agreement,
the Notes or the other Loan Documents or consent to any departure by the
Borrowers therefrom shall in any event be effective unless the same shall be
authorized as provided in paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on the Borrowers in any case shall entitle the
Borrowers to any other or further notice or demand in similar or other
circumstances. Each holder of any Note shall be bound by any amendment,
modification, waiver or consent authorized as provided herein, whether or not
such Note shall have been marked to indicate such amendment, modification,
waiver or consent.
(b) Neither this Agreement, any Loan Document nor any
provision hereof or thereof may be waived, amended or modified except pursuant
to an agreement or agreements in writing entered into by the Borrowers and the
Required Lenders; provided, however, that no such agreement shall (i) change the
principal amount of, or extend or advance the maturity of or any date for the
payment of any principal of or interest on, any Loan, or waive or excuse any
such payment or any part thereof, or, except as provided in this Agreement,
change the rate of interest on any Loan, or the amount of any fees payable to
any Lender without the written consent of each Lender affected thereby, (ii)
change the Commitment of any Lender without the written consent of such Lender
or change the Commitment Fees of any Lender without the written consent of each
Lender, or change the amount of the Total Commitment without the consent of each
Lender, (iii) release or defer the granting or perfecting of a Lien in any
Collateral or release any guaranty or similar undertaking provided by any Person
or modify any indemnity provided to the Lenders hereunder or under the other
Loan Documents without the written consent of each Lender; provided however the
Agent or the Floor Plan Agent, as the case may be, shall be entitled to release
any Collateral or any guaranty which a Borrower is permitted to sell or transfer
or otherwise release under the terms of this Agreement or any Loan Document
without notice to or any further action or consent of the Lenders; or (iv) amend
or modify the provisions of this Section 13.7, Section 13.3, Section 4.6(c),
Section 12.1(d), Section 6.7(a) or the definition of the "Required Lenders,"
without the written consent of each Lender; and provided further that no such
agreement shall amend, modify, waive or otherwise affect the rights or duties of
the Agent or the Floor Plan Agent hereunder without the written consent of the
Agent or the Floor Plan Agent, respectively. Each Lender and each holder of any
Note shall be bound by any modification or amendment authorized by this Section
13.7 regardless of whether its Note shall be marked to make reference thereto,
and any consent by any Lender or holder of a
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Note pursuant to this Section 13.7 shall bind any Person subsequently acquiring
a Note from it, whether or not such Note shall be so marked.
SECTION XIII.8 Interest. Each provision in this Agreement and each
other Loan Document is expressly limited so that in no event whatsoever shall
the amount contracted for, charged, paid, or otherwise agreed to be paid, or
received to the Agent or any Lender for the use, forbearance or detention of the
money to be loaned under this Agreement or any Loan Document or otherwise
(including any sums paid as required by any covenant or obligation contained
herein or in any other Loan Document which is for the use, forbearance or
detention of such money), exceed that amount of money which would cause the
effective rate of interest to exceed the Highest Lawful Rate, and all amounts
owed under this Agreement and each other Loan Document shall be held to be
subject to reduction to the effect that such amounts so paid or agreed to be
paid which are for the use, forbearance or detention of money under this
Agreement or such Loan Document shall in no event exceed that amount of money
which would cause the effective rate of interest to exceed the Highest Lawful
Rate. Anything in this Agreement or any Note or any other Loan Document to the
contrary notwithstanding, none of the Borrowers shall ever be required to pay
unearned interest on any Note and shall never be required to pay interest on
such Note at a rate in excess of the Highest Lawful Rate, and if the effective
rate of interest which would otherwise be payable under this Agreement, such
Note and the other Loan Documents would exceed the Highest Lawful Rate, or if
the holder of such Note shall receive any unearned interest or shall receive
monies that are deemed to constitute interest which would increase the effective
rate of interest payable by the Borrowers under this Agreement and such Note to
a rate in excess of the Highest Lawful Rate, then (a) the amount of interest
which would otherwise be payable by the Borrowers under this Agreement, such
Note or any Loan Document shall be reduced to the amount allowed under
applicable law, and (b) any unearned interest paid by the Borrowers or any
interest paid by the Borrowers in excess of the Highest Lawful Rate shall be
credited on the principal of such Note (or, if the principal amount of such Note
shall have been paid in full, refunded to the Borrowers). It is further agreed
that, without limitation of the foregoing, all calculations of the rate of
interest contracted for, charged or received by any Lender under the Notes held
by it, or under this Agreement, are made for the purpose of determining whether
such rate exceeds the Highest Lawful Rate applicable to such Lender (such
Highest Lawful Rate being such Lender's "Maximum Permissible Rate"), and shall
be made, to the extent permitted by usury laws applicable to such Lender (now or
hereafter enacted), by amortizing, prorating and spreading in equal parts during
the period of the full stated term of the Loans evidenced by said Notes all
interest at any time contracted for, charged or received by such Lender in
connection therewith. If at any time and from time to time (i) the amount of
interest payable to any Lender on any date shall be computed at such Lender's
Maximum Permissible Rate pursuant to this Section 13.8 and (ii) in respect of
any subsequent interest computation period the amount of interest otherwise
payable to such Lender would be less than the amount of interest payable to such
Lender computed at such Lender's Maximum Permissible Rate, then the amount of
interest payable to such Lender in respect of such subsequent interest
computation period shall continue to be computed at such Lender's Maximum
Permissible Rate until the total amount of interest payable to such Lender shall
equal the total amount of interest which would have been payable to such Lender
if the total amount of interest had been computed without giving effect to this
Section 13.8.
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SECTION XIII.9 Severability; Conflicts.
(a) In the event any one or more of the provisions contained
in this Agreement, the Notes or any other Loan Document should be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or therein shall not
in any way be affected or impaired thereby. The parties shall endeavor in good
faith negotiations to replace the invalid, illegal or unenforceable provisions
with valid provisions, the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.
(b) In the event any of the terms and provisions of any other
Loan Document are inconsistent with the terms and provisions set forth in this
Agreement, the terms and provisions set forth in this Agreement shall prevail.
SECTION XIII.10 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one contract, and shall become
effective as provided in Section 13.11.
SECTION XIII.11 Binding Effect. This Agreement shall become effective
on the Closing Date, and thereafter shall be binding upon and inure to the
benefit of each Borrower, the Agent, the Floor Plan Agent and each Lender and
their respective successors and assigns, except that no Borrower shall have the
right to assign its rights hereunder or any interest herein except as provided
in Section 13.3(a).
SECTION XIII.12 Further Assurances. Each Borrower shall make, execute
or endorse, and acknowledge and deliver or file or cause the same to be done,
all such vouchers, invoices, notices, certifications and additional agreements,
undertakings, conveyances, deeds of trust, mortgages, transfers, assignments,
financing statements or other assurances, and take any and all such other
action, as the Agent or the Floor Plan Agent may, from time to time, deem
reasonably necessary or proper in connection with any of the Loan Documents, the
Obligations of the Borrowers thereunder or for better assuring and confirming
unto the Lenders all or any part of the security for any of such Obligations.
SECTION XIII.13 Subsidiary Solvency Savings Clause. Each of the
Borrowers acknowledges the receipt and acceptance of valuable consideration as
of the Closing Date and thereafter in connection with this Agreement; and each
such Borrower further acknowledges and agrees that the direct benefits and
enrichment it derives from being a party to this Agreement constitute a
reasonably equivalent value to it in exchange for the joint and several
liability it has incurred pursuant to this the Agreement. Further, each of the
Borrowers acknowledges the interdependence by and among the other Borrowers in
successfully carrying out their business operations. Each of the Borrowers
represents that it is solvent prior to entering into this Agreement and that the
transactions completed hereby will not render it insolvent and will not cause it
to become financially non-viable in the future; provided, however in the event
that the Indebtedness incurred by any Borrower pursuant to this Agreement or the
transactions contemplated hereby would constitute a "fraudulent transfer" as to
any such Borrower under Section 548 of the Federal
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Bankruptcy Code or pursuant to any applicable state law governing "fraudulent
transfers" because such Borrower is deemed to have become insolvent as a result
of incurring such Indebtedness, then, in such event, the liability of any such
Borrower hereunder shall be deemed for all purposes to be equal to one dollar
less than that amount of Indebtedness which would not render such Borrower
insolvent.
SECTION XIII.14 Joint and Several Liability and Related Matters.
(a) Each of Floor Plan Borrowers other than the Company
authorizes the Company with full power and authority as attorney-in-fact, to
execute and deliver Requests for Borrowings, requests for issuance of Letters of
Credit and each other instrument, certificate and report to be delivered by any
Floor Plan Borrower to the Agent, the Floor Plan Agent and the Lenders pursuant
to this Agreement or any Loan Document. Each of the Floor Plan Borrowers other
than the Company agrees that it shall be bound by any action taken by the
Company on its behalf pursuant to such appointment.
(b) The obligations of each of the Ford Borrowers under this
Agreement and the Loan Documents shall be joint and several only with all other
Ford Borrowers and the liability of each of the Ford Borrowers shall be limited
to an amount equal to the Ford Borrower Liability Amount and the Collateral of
all Ford Borrowers granted or pledged to the Agent for the benefit of the
Lenders to secure the Obligations shall secure only that portion of the
Obligations attributable to all of the Ford Borrowers as hereinabove provided.
The obligations of each of the GM Borrowers under this Agreement and the Loan
Documents shall be joint and several with all the Borrowers and (except as
provided in the GM Borrower Guaranty executed by each of the GM Borrowers) the
liability of each of the GM Borrowers shall be limited to an amount equal to the
GM Borrower Liability Amount and the Collateral of all GM Borrowers granted or
pledged to the Agent for the benefit of the Lenders to secure the Obligations
shall secure only that portion of the Obligations attributable to all of the GM
Borrowers as hereinabove provided. The obligations of all other Borrowers under
this Agreement and the other Loan Documents are joint and several and not
limited in any way whatsoever.
(c) Except as herein provided, each Borrower acknowledges and
agrees that it is the intent of the parties that each Borrower be primarily
liable for the obligations as a joint and several obligor. It is the intention
of the parties that, except as herein provided, with respect to liability of any
Borrower hereunder arising solely by reason of its being jointly and severally
liable for Loans and Letter of Credit Obligations and other extensions of credit
taken by other Borrowers, the obligations of such Borrower shall be absolute,
unconditional and irrevocable irrespective of:
(i) any lack of validity, legality or
enforceability of this Agreement, any Note or any Loan
Document as to any other Borrower;
(ii) the failure of any Lender or any holder of
any Note:
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(A) to enforce any right or remedy
against any Borrower or any other Person
(including any surety) under the
provisions of this Agreement, such Note
or otherwise, or
(B) to exercise any right or remedy
against any surety of, or Collateral
securing, any obligations;
(iii) any change in the time, manner or place of
payment of, or in any other term of, all or any of the
Obligations, or any other extension, compromise or renewal of
any Obligations;
(iv) any reduction, limitation, impairment or
termination of any Obligations with respect to any other
Borrower for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be
subject to (and each Borrower hereby waives any right to or
claim of) any defense (other than the defense of payment in
full of the Obligations) or setoff, counterclaim, recoupment
or termination whatsoever by reason of the invalidity,
illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence
affecting, any Obligations with respect to any other Borrower;
(v) any addition, exchange, release, surrender or
nonperfection of any Collateral, or any amendment to or waiver
or release or addition of, or consent to departure from, any
guaranty, held by any Lender or any holder of the Notes
securing any of the Obligations; or
(vi) any other circumstance which might otherwise
constitute a defense (other than the defense of payment in
full of the Obligations) available to, or a legal or equitable
discharge of, any other Borrower, any surety or any guarantor.
(d) Each Borrower agrees that its liability hereunder
including, without limitation, any joint and several liability of such Borrower,
shall continue to be effective or be reinstated, as the case may be, if at any
time any payment (in whole or in part) of any of the Obligations is rescinded or
must be restored by any Lender or any holder of any Note, upon the insolvency,
bankruptcy or reorganization of any Borrower as though such payment had not been
made.
(e) Each Borrower hereby expressly waives: (i) notice of the
Lenders' acceptance of this Agreement; (ii) notice of the existence or creation
or non payment of all or any of the Obligations other than notices expressly
provided for in this Agreement; (iii) presentment, demand, notice of dishonor,
protest, and all other notices whatsoever other than notices expressly provided
for in this Agreement; and (iv) all diligence in collection or protection of or
realization upon the Obligations or any part thereof, any obligation hereunder,
or any security for or guaranty of any of the foregoing, subject, however, in
the case of Collateral in the possession of the Agent or
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a Lender to such Person's duty to use reasonable care in the custody and
preservation of such Collateral.
(f) No delay on any of the Lenders' part in the exercise of
any right or remedy shall operate as a waiver thereof, and no single or partial
exercise by any of the Lenders of any right or remedy shall preclude other or
further exercise thereof or the exercise of any other right or remedy. No action
of any of the Lenders permitted hereunder shall in any way affect or impair any
such Lenders' rights or any Borrower's Obligations under this Agreement.
(g) Each Borrower hereby represents and warrants to each of
the Lenders that it now has and will continue to have independent means of
obtaining information concerning the Borrowers' affairs, financial condition and
business. Lenders shall not have any duty or responsibility to provide any
Borrower with any credit or other information concerning the Borrowers' affairs,
financial condition or business which may come into the Lenders' possession.
SECTION XIII.15 WAIVER OF JURY TRIAL. THE LENDERS, THE AGENT, THE FLOOR
PLAN AGENT AND EACH OF THE BORROWERS AFTER CONSULTING OR HAVING HAD THE
OPPORTUNITY TO CONSULT WITH COUNSEL, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR ANY LOAN DOCUMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTION OF ANY OF THEM. NEITHER THE
LENDERS, THE AGENT, FLOOR PLAN AGENT NOR ANY OF THE BORROWERS SHALL SEEK TO
CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH ACTION IN WHICH A JURY TRIAL
HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED. THESE PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY
RESPECT OR RELINQUISHED BY THE LENDERS, THE AGENT, THE FLOOR PLAN AGENT OR ANY
OF THE BORROWERS EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY ALL OF THEM.
SECTION XIII.16 Loans Under Prior Credit Agreement. On the Closing
Date:
(a) The Company shall pay all accrued and unpaid commitment
fees outstanding under the Third Amended and Restated Agreement for the account
of each "lender" under the Third Amended and Restated Agreement;
(b) INTENTIONALLY DELETED
(c) each Letter of Credit outstanding under the Third Amended
and Restated Agreement shall be deemed to have been issued under this Agreement
without further consideration or any fees under the Third Amended and Restated
Agreement or this Agreement; and
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128
(d) each Drafting Agreement outstanding under the Initial
Agreement, the Amended and Restated Agreement, the Second Amended and Restated
Agreement and the Third Amended and Restated Agreement shall be deemed to have
been issued under this Agreement; and
(e) each of the Borrowers hereto acknowledges and affirms the
security interests and Liens granted by it under each of the Security Documents
to which it is a party; and
(f) the Third Amended and Restated Agreement and the
Commitments thereunder shall terminate and be superseded by this Agreement.
SECTION XIII.17 FINAL AGREEMENT OF THE PARTIES. THIS WRITTEN AGREEMENT
(INCLUDING THE EXHIBITS AND SCHEDULES HERETO), THE NOTES, THE AGENT'S LETTER,
THE FLOOR PLAN AGENT'S LETTER AND THE OTHER LOAN DOCUMENTS CONSTITUTE A "LOAN
AGREEMENT" AS DEFINED IN SECTION 26.2(a) OF THE TEXAS BUSINESS AND COMMERCE
CODE, AND REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES RELATING TO THE
SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER
HEREOF AND THEREOF. Any previous agreement among the parties with respect to the
subject matter hereof is superseded by this Agreement. Nothing in this
Agreement, expressed or implied, is intended to confer upon any party other than
the parties hereto any rights, remedies, obligations or liabilities under or by
reason of this Agreement.
SECTION 13.18 Confidentiality. In the event that the Company or any of
its Subsidiaries provides to the Agent, the Floor Plan Agent, or any Lender,
written confidential information belonging to the Company or any of its
Subsidiaries, if the Person providing such information shall denominate such
information in writing as "confidential," the Agent, the Floor Plan Agent, and
the Lenders shall thereafter maintain such information in confidence in
accordance with the standards of care and diligence that each utilizes in
maintaining its own confidential information, including without limitation,
non-disclosure of such information to any of such Agent's, Floor Plan Agent's,
or Lender's Affiliates who may be competitors of the Company and its
Subsidiaries in the business of acquiring and/or consolidating automotive
dealerships. The obligation of confidence under this Section 13.18 shall not
apply to such portions of the information which (i) are in the public domain,
(ii) hereafter become part of the public domain without the Agent, the Floor
Plan Agent, or any Lender breaching its obligation of confidence hereunder,
(iii) are previously known by such Agent, Floor Plan Agent or Lender from some
source other than the Company, (iv) are hereafter obtained by or available to
such Agent, Floor Plan Agent, or Lender from a third party who owes no
obligation of confidence to the Company and its Subsidiaries with respect to
such information or through any other means other than through disclosure by the
Company or its Subsidiaries, (v) must be disclosed either pursuant to any
requirement of any Governmental Authority or to Persons regulating the
activities of such Agent, Floor Plan Agent, or Lender, or (vi) as may be
required by law or regulation or order of any Governmental Authority in any
judicial, arbitration, or governmental proceeding. Further, the Agent, the Floor
Plan Agent, and the Lenders may disclose
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129
any such information to any other Lender, participants and prospective assignees
and participants who agree to be bound by the terms of this Section 13.18,
Affiliates of such Lender who are not competitors of the Company and its
Subsidiaries in the business of acquiring and/or consolidating automotive
dealerships, any independent certified public accountants and any legal counsel
employed by such Person in connection with this Agreement or any Security
Document, including without limitation, the enforcement or exercise of all
rights and remedies thereunder; provided, however, that the Agent, Floor Plan
Agent, or such Lender imposes on the Person to whom such information is
disclosed the same obligation to maintain the confidentiality of such
information as is imposed upon it hereunder.
* * *
Signatures following on succeeding pages
128
130
IN WITNESS HEREOF, the Borrowers, the Lenders listed on the signature
pages hereto, the Agent and the Floor Plan Agent have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
BORROWERS: GROUP 1 AUTOMOTIVE, INC.,
a Delaware corporation
By:
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
COURTESY NISSAN, INC., a Texas corporation;
FOYT MOTORS, INC., a Texas corporation; ▇▇▇
▇▇▇▇▇▇ AUTOMOTIVE-H, INC., an Oklahoma
corporation; ▇▇▇ ▇▇▇▇▇▇ DODGE, INC., an
Oklahoma corporation; ▇▇▇ ▇▇▇▇▇▇ MOTORS, INC.,
an Oklahoma corporation; ▇▇▇▇▇▇ PONTIAC-GMC,
Inc., an Oklahoma corporation; ROUND ROCK
NISSAN, INC., a Texas corporation; SMC LUXURY
CARS, INC., a Texas corporation; ▇▇▇▇ ▇▇▇▇▇
AUTOPLAZA, INC., a Texas corporation; ▇▇▇▇▇,
LIU & ▇▇▇▇▇▇, INC., a Texas corporation;
▇▇▇▇▇, LIU & ▇▇▇▇, INC., a Texas corporation;
SOUTHWEST TOYOTA, INC., a Texas corporation;
TOWN NORTH IMPORTS, Inc., a Texas corporation;
TOWN NORTH NISSAN, INC., a Texas corporation;
TOWN NORTH SUZUKI, INC., a Texas corporation;
COURTESY FORD, INC., a Florida corporation;
GROUP 1 FORD, INC., a Texas corporation; ▇▇▇
▇▇▇▇▇▇ NISSAN, INC., an Oklahoma corporation;
▇▇▇▇▇ FORD, INC., a Florida corporation;
PERIMETER FORD, INC., a Delaware corporation;
▇▇▇▇ ▇▇▇▇▇ AUTOMOTIVE-N, INC., a Texas
corporation; ▇▇▇▇ ▇▇▇▇▇ AUTOPLEX, INC., a
Texas corporation; ▇▇▇▇ ▇▇▇▇▇ AUTOPLEX BUICK,
INC., a Texas corporation; ▇▇▇▇ ▇▇▇▇▇ AUTOPLEX
DODGE, INC., a Texas corporation; ▇▇▇▇ ▇▇▇▇▇
AUTOPLEX-GERMAN IMPORTS, INC., a Texas
corporation; ▇▇▇▇ ▇▇▇▇▇ AUTOPLEX-V, INC., a
Texas corporation; CASA CHRYSLER PLYMOUTH
JEEP, INC., a New Mexico corporation; CASA
CHEVROLET, INC., a New Mexico corporation;
FLAMINGO FORD, INC., a Florida
131
corporation; HIGHLAND AUTOPLEX, INC., a Texas
corporation; WORLD AUTOMOTIVE GROUP, INC., a
Florida corporation; MMK INTERESTS, INC., a
Texas corporation; ▇▇▇ ▇▇▇▇▇▇ CHEVROLET, INC.,
an Oklahoma corporation; ▇▇▇▇▇▇ AUTOMOTIVE
GROUP, INC., an Oklahoma corporation; ▇▇▇▇
▇▇▇▇▇ L/M, INC., a Delaware corporation; ▇▇▇▇
▇▇▇▇▇ GM, INC., a Delaware corporation;
▇▇▇▇▇▇▇▇ DODGE, INC., a Texas corporation;
▇▇▇▇ CHEVROLET CO., a Delaware corporation;
▇▇▇ ▇▇▇▇▇▇ AUTOMOTIVE-EAST, INC., an Oklahoma
corporation; ▇▇▇▇ ▇▇▇▇▇ MOTORS, INC., a Texas
corporation; SUNSHINE BUICK PONTIAC GMC TRUCK,
INC., a New Mexico corporation; ▇▇▇▇ ▇▇▇▇▇
IMPORTS, INC., a Texas corporation; ▇▇▇
▇▇▇▇▇▇▇ FORD, INC., a Delaware corporation;
▇▇▇▇ ▇▇▇▇▇ AUTOMOTIVE-H, INC., a Texas
corporation; KINGWOOD MOTORS-H, INC., a Texas
corporation; LUBBOCK MOTORS, INC., a Texas
corporation; ▇▇▇ ▇▇▇▇▇▇ AUTOMOTIVE-A, INC., an
Oklahoma corporation; ▇▇▇ ▇▇▇▇▇▇ AUTOMOTIVE-J,
INC., an Oklahoma corporation; ▇▇▇ ▇▇▇▇▇▇
GERMAN IMPORTS, INC., an Oklahoma corporation;
▇▇▇ ▇▇▇▇▇▇ AUTOMOTIVE-V, INC., an Oklahoma
corporation; ▇▇▇▇▇▇ AUTOMOTIVE GROUP, INC., a
Delaware corporation; LUBBOCK MOTORS-M, INC.,
a Delaware corporation; ▇▇▇▇▇ AUTOMOTIVE
GROUP, INC., a New Mexico corporation; GPI
ACQUISITION-I, INC., a Texas corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
GROUP 1 REALTY, INC., a Delaware corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
132
▇▇▇▇ AUTO GROUP, INC., a Texas corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
▇▇▇▇▇▇▇ CHRYSLER, PLYMOUTH, DODGE, JEEP,
EAGLE, LTD., a Texas limited partnership;
PRESTIGE CHRYSLER PLYMOUTH SOUTH, LTD., a
Texas limited partnership; PRESTIGE CHRYSLER
PLYMOUTH NORTHWEST, LTD., a Texas limited
partnership; HIGHLAND AUTOPLEX II, LTD., a
Texas limited partnership; ▇▇▇▇▇▇▇ ▇▇▇▇, LTD.,
a Texas limited partnership
By: MMK INTERESTS, INC., a Texas
corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
COLONIAL CHRYSLER-PLYMOUTH, LTD., a Texas
limited partnership; CHAPERRAL DODGE, LTD., a
Texas limited partnership
By: ▇▇▇▇ Auto Group, Inc., a Texas
corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
133
LUBBOCK MOTORS-F, LTD., a Texas limited
partnership; LUBBOCK MOTORS-T, LTD., a Texas
limited partnership; ROCKWALL AUTOMOTIVE-F,
LTD., a Texas limited partnership; AMARILLO
MOTORS-C, LTD., a Texas limited partnership;
AMARILLO MOTORS-J, LTD., a Texas limited
partnership; AMARILLO MOTORS-F, LTD., a Texas
limited partnership
By: LUBBOCK MOTORS, INC., a Texas
corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
GROUP 1 HOLDINGS-DC, L.L.C., a Delaware
limited liability company; GROUP 1 HOLDINGS-F,
L.L.C., a Delaware limited liability company;
GROUP 1 HOLDINGS-GM, L.L.C., a Delaware
limited liability company; GROUP 1 HOLDINGS-H,
L.L.C., a Delaware limited liability company;
GROUP 1 HOLDINGS-N, L.L.C., a Delaware limited
liability company; GROUP 1 HOLDINGS-S, L.L.C.,
a Delaware limited liability company; GROUP 1
HOLDINGS-T, L.L.C., a Delaware limited
liability company
By: GROUP 1 AUTOMOTIVE, INC., a Delaware
corporation
By:
-----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
134
GROUP 1 LP INTERESTS-DC, INC., a Delaware
corporation; GROUP 1 LP INTERESTS-F, INC., a
Delaware corporation; GROUP 1 LP INTERESTS-GM,
INC., a Delaware corporation; GROUP 1 LP
INTERESTS-H, INC., a Delaware corporation;
GROUP 1 LP INTERESTS-N, INC., a Delaware
corporation; GROUP 1 LP INTERESTS-S, INC., a
Delaware corporation; GROUP 1 LP INTERESTS-T,
INC., a Delaware corporation; GROUP 1
HOLDINGS, INC., a Delaware corporation
By:
-------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
DELAWARE ACQUISITION-CC, L.L.C., a Delaware
limited liability company
By: GROUP 1 LP INTERESTS-DC, INC., a
Delaware corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
DELAWARE ACQUISITION-GM, L.L.C., a Delaware
limited liability company
By: GROUP 1 INTERESTS-GM, INC., a
Delaware corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
135
DELAWARE ACQUISITION-T, L.L.C., a Delaware
limited liability company
By: GROUP 1 LP INTERESTS-T, INC.,
a Delaware corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
DELAWARE ACQUISITION-F, L.L.C., a Delaware
limited liability company
By: GROUP 1 LP INTERESTS-F, INC.,
a Delaware corporation
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
DELAWARE ACQUISITION-Z, L.L.C., a Delaware
limited liability company
By: GROUP 1 HOLDINGS, INC., a Delaware
corporation
By:
-----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: President
136
AGENT AND ISSUING BANK: CHASE BANK OF TEXAS, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. Dolphin
Title: Senior Vice President
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ BANK
AND SWING LINE BANK
By:
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President
138
LENDERS: AMARILLO NATIONAL BANK
By:
------------------------------------------
Name: R. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President
Address: P. O. ▇▇▇ ▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
------------------------------------
Eurodollar Lending Office
Attention:
------------------------------------
139
BMW FINANCIAL SERVICES N.A., INC.
By:
-------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Manager, Retailer Commercial
Financial Services
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
------------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
140
BANKBOSTON, N.A.
By:
------------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇: MA EAS 77-01-14
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
141
BANK OF AMERICA, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
142
BANK OF OKLAHOMA, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
143
BANK ONE TEXAS, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Edge
Title: Vice President
Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. Dolphin
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇-▇▇▇▇-▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
145
CHRYSLER FINANCIAL COMPANY, L.L.C.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Address: Dealer Credit Department
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
146
COMERICA BANK
By:
------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
----------------------------------
Eurodollar Lending Office
Attention:
----------------------------------
147
FORD MOTOR CREDIT COMPANY
By:
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇
Title: Major Accounts Executive
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
148
GENERAL MOTORS ACCEPTANCE
CORPORATION
By:
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director of National Accounts,
Assistant Treasurer
Address: GMAC National Accounts Dept.
GMAC Building 3-132
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
149
NORWEST BANK MINNESOTA, N.A.
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President, Auto Finance Group
Address: ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
150
TOYOTA MOTOR CREDIT CORPORATION
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Address: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
----------------------------------
Eurodollar Lending Office
Attention:
----------------------------------
151
U.S. BANK NATIONAL ASSOCIATION
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Address: ▇▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------
152
WORLD OMNI FINANCIAL CORP.
By:
-----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Address: ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office
Attention:
-----------------------------------
Eurodollar Lending Office
Attention:
-----------------------------------