EXHIBIT 10.61
WAIVER AND THIRD AMENDMENT TO
REVOLVING CREDIT AGREEMENT
THIS WAIVER AND THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT dated as
of June 30, 1998 (this "AMENDMENT"), by and between Cross-Continent Auto
Retailers, Inc., a Delaware corporation (the "PARENT"), the other Borrowers
identified on the signature pages hereto (together with the Parent,
collectively, the "BORROWERS"), the financial institutions listed on the
signature pages hereto (the "BANKS"), and Chase Bank of Texas, National
Association, formerly known as Texas Commerce Bank National Association, a
national banking association, in its capacity as Agent (the "AGENT") and in its
individual capacity as a Bank hereunder ("CBT").
WHEREAS, the Borrowers, the Banks and the Agent have entered into that
certain Revolving Credit Agreement dated as of June 26, 1997, as amended by that
certain First Amendment to Revolving Credit Agreement dated July 1, 1997, and as
further amended by that certain Second Amendment to Revolving Credit Agreement
dated March 27, 1998 (together with any and all amendments and modifications
thereof, the "CREDIT AGREEMENT"; capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in the Credit Agreement); and
WHEREAS, the Borrowers have requested that the Banks (i) waive the
Borrowers' compliance with Section 10.1(b) and Section 10.1(d) of the Credit
Agreement for the Borrowers' fiscal quarterly period ending March 31, 1998, and
(ii) amend the Credit Agreement in several respects as provided for herein;
NOW, THEREFORE, in consideration of the premises, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. WAIVER. The Banks hereby waive the Borrowers'
compliance with Section 10.1(b) (relating to Leverage Ratio) of the Credit
Agreement and Section 10.1(d) (relating to Interest Coverage Ratio) of the
Credit Agreement for the period ending March 31, 1998, and any rights and
remedies the Banks may have in respect of the provisions waived pursuant to this
Amendment.
SECTION 2. AMENDMENTS TO THE CREDIT AGREEMENT.
(a) "Exhibit A" to the Credit Agreement is hereby amended by
inserting the following definition in its proper alphabetical order:
"HICKEY DODGE NOTE" shall mean that certain promissory note,
executed by the Parent, payable to Chrysler Financial Corporation.
(b) The definition of "Leverage Ratio" is hereby amended by inserting
at the end thereof the following provision:
"; PROVIDED, HOWEVER, for purposes of calculating Leverage Ratio
for the period ending June 30, 1998, an amount equal to $2,000,000
payable under the Hickey Dodge Note shall be allocated, without
duplication of other amounts included in the determination of
indebtedness outstanding under Floor Plan Financings, to indebtedness
outstanding under Floor Plan Financings."
(c) The definition of "Interest Coverage Ratio" is hereby amended by
deleting the language following the phrase "PROVIDED, HOWEVER," and by inserting
in lieu thereof the following language:
"for purposes of calculating Interest Coverage Ratio for the
period ending March 31, 1998, and all subsequent applicable periods,
(i) an amount equal to the annualized rent payments resulting from the
Sale and Leaseback Transaction shall be deducted, without duplication
of other amounts included in the determination of Consolidated EBITDA,
from Consolidated EBITDA, and (ii) an amount equal to the sum of (x)
the reduction in interest expense attributable to any repayment of the
Debt related to any real estate financings otherwise permitted by
Section 10.3 hereof, plus (y) pro forma interest income (calculated at
8.8% per annum) attributable to the net proceeds, following repayment
of the Debt referred to in subparagraph (x) above, from the Sale and
Leaseback Transaction, as if such proceeds had been received on April
1, 1997, shall be deducted from Interest Expense."
SECTION 3. CONDITIONS TO EFFECTIVENESS. This Amendment shall
become effective as of May 15, 1998 upon the Agent's receipt of original
execution copies of this Amendment, executed and delivered by the parties
hereto.
SECTION 4. RATIFICATION OF LOAN DOCUMENTS. The Credit Agreement,
as amended hereby, the Notes and each other Loan Document is hereby ratified and
confirmed to be in full force and effect. Each reference in a Loan Document to
the "Credit Agreement" shall be deemed a reference to the Credit Agreement as
amended hereby.
SECTION 5. LIMITATIONS. The amendments set forth herein are
limited precisely as written and shall not be deemed to (a) be a consent to, or
waiver or modification of, any other term or condition of the Credit Agreement
or any of the Loan Documents, or (b) prejudice any right or rights which the
Agent and the Banks may now have or may have in the future under or in
connection with the Credit Agreement, the Loan Documents or any of the other
documents referred
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to therein. Except as expressly modified hereby, the terms and provisions of
the Credit Agreement, the Notes and any other Loan Documents or any other
documents or instruments executed in connection with any of the foregoing are
and shall remain in full force and effect. In the event of a conflict between
the Amendment and any of the foregoing documents, the terms of this Amendment
shall be controlling.
SECTION 6. REPRESENTATIONS AND WARRANTIES; ACKNOWLEDGEMENTS; NO DEFAULT.
The Borrowers hereby represent and warrant that on and as of the date hereof,
and after giving effect hereto: (i) the representations and warranties of the
Borrowers made in Section 7 of the Credit Agreement (other than those
representations and warranties limited by their terms to a specific date)
shall be true and correct; and (ii) no Default or Event of Default shall have
occurred and be continuing. The Borrowers hereby acknowledge and reaffirm
that there are no claims, counterclaims, defenses, concessions, offsets,
abatements or deductions regarding the obligation of any Borrower under the
Note or any other Loan Document. The Borrowers further acknowledge that the
Agent and the Banks are not in default of any of their obligations and as of
the date hereof have fully performed all their obligations under the Loan
Documents. No event has occurred that would in any way render the Agent or
any of the Banks liable to the Borrowers under the Loan Documents
SECTION 7. PAYMENT OF EXPENSES; RELEASE. The Borrowers jointly and
severally agree, whether or not the transactions hereby contemplated shall be
consummated, to reimburse and save the Agent and the Banks harmless from and
against liability for the payment of all reasonable out-of-pocket costs and
expenses arising in connection with the preparation, execution, delivery,
waiver and enforcement of, or the preservation of any rights under this
Amendment. The Borrowers release and discharge the Agent and the Banks, their
employees, officers and attorneys from all damage, loss, claims, liabilities,
actions and causes of action whatsoever that the Borrowers may now have or
claim to have against the Agent and the Banks, whether presently known or
unknown, on account of, relating to or arising out of the Loan Documents or
that may arise as a consequence of the dealings between the parties up to and
including the date hereof. The provisions of this Section 7 shall survive the
termination of the Credit Agreement and the repayment of the Loans.
SECTION 8. CHOICE OF LAW. THE AMENDMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER AND UNDER THE CREDIT AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS AND THE
UNITED STATES OF AMERICA. THIS AMENDMENT IS A LOAN DOCUMENT.
SECTION 9. DESCRIPTIVE HEADINGS. The descriptive headings of the
several Sections of this Amendment are inserted for convenience only and shall
not be deemed to affect the meaning or construction of any of the provisions
hereof.
SECTION 10. ENTIRE AGREEMENT. THE AMENDMENT AND THE DOCUMENTS REFERRED
TO HEREIN REPRESENT THE ENTIRE UNDERSTANDING OF THE PARTIES HERETO REGARDING
THE SUBJECT MATTER HEREOF AND SUPERSEDE ALL PRIOR AND CONTEMPORANEOUS
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ORAL AND WRITTEN AGREEMENTS OF THE PARTIES HERETO WITH RESPECT TO THE SUBJECT
MATTER HEREOF.
SECTION 11. COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by parties hereto on separate counterparts, each
counterpart, when so executed and delivered, constitute an original
instrument, and all such counterparts shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and authorized by their respective officers as of June 30, 1998.
BORROWERS: CROSS-CONTINENT AUTO
RETAILERS, INC.
By:
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Name: John Gaines
Title: Vice President - Finance and
Treasurer
QUALITY NISSAN, INC.
By:
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Name: John Gaines
Title: Treasurer
MIDWAY CHEVROLET, INC.
By:
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Name: John Gaines
Title: Treasurer
PLAINS CHEVROLET, INC.
By:
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Name: John Gaines
Title: Treasurer
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WESTGATE CHEVROLET, INC.
By:
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Name: John Gaines
Title: Treasurer
WORKING MAN'S CREDIT PLAN, INC.
By:
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Name: John Gaines
Title: Treasurer
ALLIED 2000 COLLISION CENTER, INC.
By:
---------------------------------
Name: John Gaines
Title: Treasurer
CROSS-COUNTRY DODGE, INC.
By:
---------------------------------
Name: John Gaines
Title: Treasurer
C-CAR AUTO WHOLESALERS, INC.
By:
---------------------------------
Name: John Gaines
Title: Treasurer
DOUGLAS MOTORS, INC.
By:
---------------------------------
Name: John Gaines
Title: Treasurer
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T- WEST SALES & SERVICE, INC.
By:
---------------------------------
Name: John Gaines
Title: Treasurer
SAHARA IMPORTS, INC.
By:
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Name: John Gaines
Title: Treasurer
SAHARA NISSAN, INC.
By:
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Name: John Gaines
Title: Treasurer
BANKS: CHASE BANK OF TEXAS,
NATIONAL ASSOCIATION, as a
Bank and as Agent
By:
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Name:
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Title:
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AMARILLO NATIONAL BANK
By:
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Name:
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Title:
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THE BANK OF TOKYO-MITSUBISHI, LTD.,
HOUSTON AGENCY
By:
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Name:
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Title:
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U.S. BANK
By:
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Name:
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Title:
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