Exhibit 4.2.1


 


THIRD AMENDMENT TO AGENTED REVOLVING CREDIT
AGREEMENT


 


 


THIS THIRD AMENDMENT TO AGENTED REVOLVING
CREDIT AGREEMENT (“Amendment”) is dated effective as
of November 30, 2003, by and among AMERICA’S
CAR MART, INC., an Arkansas corporation (“ACM-Arkansas”), COLONIAL AUTO FINANCE, INC., an Arkansas
corporation (“Colonial”) and TEXAS CAR-MART,
INC. (formerly Texarkana Car Mart, Inc.), a Texas corporation
(“TCM”) (separately a “Borrower”, and collectively the “Borrowers”), and BANK OF ARKANSAS, N.A., GREAT SOUTHERN BANK, BANK OF OKLAHOMA, N.A., ARVEST BANK,
FIRST STATE BANK, and ARKANSAS STATE
BANK, separately an “Initial Lender” and collectively the
“Initial Lenders”), BANK OF ARKANSAS, N.A.,
as agent for the Banks (in such capacity, the “Agent”), and BANK OF OKLAHOMA, N.A., as the paying agent
(“Paying Agent”).


 


RECITALS


 


A.                                   Reference
is made to the Agented Revolving Credit Agreement dated as of December 18,
2001 (as amended February 1, 2002, and November 18, 2002, the “Credit
Agreement”), by and among Borrowers, Banks, Agent and Paying Agent, pursuant to
which the Banks established a $39,500,000 Revolving Line of Credit in favor of
Borrowers for the purpose of refinancing existing indebtedness and for working
capital needs and general business purposes.


 


B.                                     Effective
the date hereof, the Banks intend to modify their commitments under the Credit
Agreement and to extend the maturity date of the Notes to April 30, 2006.


 


C.                                     The
parties hereto hereby intend to further amend the Credit Agreement to reflect
the foregoing changes.


 


AGREEMENT


 


For valuable consideration received, the parties agree to the
following.


 


1.                                       Defined
Terms.  As used in this Amendment
the following terms shall have the meanings given.


 


1.1.                              “Restructured and
Renewed Notes” means the $2,500,000 Promissory Note payable to the order of
Arkansas State Bank, the $5,000,000 Promissory Note payable to the order of
Great Southern Bank, the $5,000,000 Promissory Note payable to the order of
Arvest Bank, the $2,000,000 Promissory Note payable to the order of First State
Bank, the $24,000,000 Promissory Note payable to the order of Bank of Oklahoma,
N.A., and the $1,000,000 Promissory Note payable to the order of Bank of
Arkansas, N.A., in form and content as set forth on Schedule “1.1”
hereto.


 

















 


1.2.                              “Chattel Check”
means a chattel check as to each of the Borrowers from their respective states
of incorporation.


 


2.                                       Amendments
to Credit Agreement. The Credit Agreement is amended as follows.


 


2.1.                              The
following terms are hereby added or modified as follows:


 


2.1.1.                     “Advance Rate” means fifty percent
(50%) of Eligible Vehicle Contracts; provided, however, that the Advance Rate
shall be reduced by twice the percentage amount by which the Advance Rate
Adjustment Percent exceeds 33% (rounded to the nearest one-tenth percent), in
each instance such adjustments to be calculated as of the last day of each
month and effective as of the first day of the following month.  For example, if the Advance Rate Adjustment
Percent were 34% (1% over the standard), the Advance Rate would be reduced by
2%.


 


2.1.2.                     “Bank” means any of the Banks.


 


2.1.3.                     “Banks” means any Initial Lender
and each Person that shall become a Bank hereunder pursuant to
Section 10.13.


 


2.1.4.                     “Borrowing Base” means, as of the
date of determination, the amount determined by multiplying the Advance Rate by
the Net Eligible Contract Payments then outstanding.


 


2.1.5.                     “Crown Sub-Debt” means the
revolving line of credit provided to Borrower by ACM-Texas, in an amount not to
exceed Ten Million Dollars ($10,000,000).”


 


2.1.6.                     “Funded Debt” means all
outstanding Debt For Borrowed Money.


 


2.1.7.                     “Majority Banks” means, at any
time of determination, the Banks holding at least sixty-six percent (66%) of
the Aggregate Revolver Outstanding.


 


2.1.8.                     “Revolving Credit Commitment” or
“Commitment” means, with respect to any Bank, the amount opposite such Bank’s
name on its signature page hereto.


 


2.1.9.                     “Revolving Credit Loans” means an
advance of funds under Section 2.01.


 


2.1.10.               “Unused Revolving Credit Commitment”
means, with respect to any Bank at any time of determination, (a) such Bank’s
Revolving Credit Commitment at such time minus (b) the sum of the aggregate
principal amount of all Revolving Credit Loans made by such Bank and
outstanding at such time.


 

















 


2.2.                              The term “Termination
Date” is amended to evidence that the date “April 30, 2004” shall now mean
“April 30, 2006.”


 


2.3.                              Section 2.01
(Revolving Credit) is hereby amended to read as follows:


 


“Section 2.01.  Revolving Credit. Each Bank
severally agrees, on the terms and conditions hereinafter set forth, to make
the Revolving Credit Loans to the Borrower from time to time during the period
from the date of this Agreement up to but not including the Termination Date in
an aggregate principal amount not to exceed at any time outstanding the
aggregate Revolving Credit Commitment provided, that the aggregate outstanding
principal amount of advances at any time outstanding shall not exceed the
lesser of:  (i) the aggregate Revolving
Credit Commitment; or (ii) the Borrowing Base. 
Such Borrowing Base shall be computed on a monthly basis, and Borrower
agrees to provide Agent, on or before the 15th of each month with regard to the
immediately preceding month (or more frequently as reasonably required by Agent
from time to time), all information requested in connection therewith,
including without limitation the Borrowing Base Certificate.  In the event that the Borrowing Base is less
than the Aggregate Revolver Outstanding, the Borrower shall immediately notify
Agent of such situation and shall, within five (5) Business Days of the
imbalance, either (i) reduce the amount of the outstanding balances to bring
such amounts within the formulas prescribed, or (ii) provide additional
Eligible Vehicle Contracts, without any additional advance being made by any
Bank with respect thereto, necessary to comply with the formulas required
herein.  Each Loan made in respect of
the Revolving Credit Loans shall be made by each Bank in its Pro Rata
Share.  Within the limits of the
Commitment, the Borrower may borrow, repay and reborrow under this Section 2.01.  On such terms and conditions, the Loans may
be outstanding as Prime Loans or LIBOR Loans. 
Each type of Loan shall be made and maintained at such Bank’s Lending
Office for such type of Loan.  The
failure of any Bank to make any requested Revolving Credit Loan to be made by
it on the date specified for such Loan shall not relieve any other Bank of its
obligation (if any) to make such Loan on such date, but no Bank shall be responsible
for the failure of any other Bank to make such Loans to be made by such other
Bank.”


 


2.4.                              Section 2.05 is
hereby amended to replace the existing pricing grid with the following:


 


	
  Borrower’s Ratio of

  Funded Debt to EBITDA

  	
   

  	
  Adjusted

  LIBOR Rate

  	
   

  	
  Adjusted
Prime Rate

  	
   

  
	
  < 2.0

  	
   

  	
   

  	
  LIBOR
  Rate plus 3.0%

  	
   

  	
  Prime Rate plus 0.0%

  	
   

  
	
  > 2.0 < 2.25

  	
   

  	
   

  	
  LIBOR
  Rate plus 3.25%

  	
   

  	
  Prime Rate plus .25%

  	
   

  
	
  > 2.25 < 2.50

  	
   

  	
   

  	
  LIBOR
  Rate plus 3.50%

  	
   

  	
  Prime Rate plus .50%

  	
   

  
	
  > 2.50

  	
   

  	
   

  	
  LIBOR
  Rate plus 3.75%

  	
   

  	
  Prime Rate plus .75%

  	
   

  



 


3

















 


2.5.                              Section 2.07 (Unused
Portion Fee) is hereby amended to read as follows:


 


Section 2.07. Unused Portion Fee. The
Borrower agrees to pay to the Agent for the account of each Bank a commitment
fee on the average daily unused portion of such Bank’s Commitment from the date
of this Agreement until the Termination Date at the rate of one-tenth of one
percent (1/10 of 1%) per annum, payable on the last day of each quarter during
the term of such Bank’s Commitment, commencing November 30, 2003, and
ending on the Termination Date.  Upon
receipt of any commitment fees, the Agent will promptly thereafter cause to be
distributed such payments to the Banks in the proportion that each Bank’s
unused Commitment bears to the total of all the Banks’ unused Commitments;
provided, that any Additional Bank will not receive any payment of Unused
Portion Fees earned or paid prior to the date this Agreement is executed by
said Additional Bank.  Further, no
Unused Portion Fees will be paid for any given month during which the average
monthly revolving balance exceeds $25,000,000 during each quarter the Unused
Portion Fee is billed.


 


2.6.                              Section 2.16
(Termination Fee) is hereby amended to read as follow:


 


“Section 2.16.  Termination Fee.  The Borrower may terminate this Agreement at
any time upon not less than ten (10) Business Day’s notice to Agent of such
intention, provided, that all monetary obligations (e.g. payment of Notes) and
any indemnification shall continue; and provided further that Borrower agrees
to pay to the Agent for the account of each Bank a termination fee in an
aggregate amount equal to $100,000 in the event the credit facility is
terminated for any reason prior to six (6) months from the execution date hereof;
provided, that no termination fee shall be payable for any prepayment if the
Borrower is required to make any payments under Sections 2.13 and/or 2.14.”


 


2.7.                              Section 6.01(8)(d)
(Liens) is hereby amended to evidence that the sum “One Million Dollars ($1,000,000)”
shall now mean and read “One Million Five Hundred Thousand Dollars
($1,500,000).”


 


2.8.                              Section 6.02(2)
(Debt) is amended to read as follows:


 


“(2)  Debt described on Exhibit
“J” (i.e. Crown Sub-Debt), not to exceed $10,000,000 at any given time, and
no prepayment, renewals, extensions or refinancings shall occur following the
occurrence and continuance of an Event of Default;”


 


2.9.                              Section 6.02(7)
(Debt) is hereby amended to evidence that the sum “$1,000,000” shall now mean
and read “$1,500,000.”


 


2.10.                        Section 6.10(iv)
(Transactions with Affiliates) is hereby amended to evidence that the sum
“$10,000 per month” shall now mean and read “$350,000 per fiscal year.”


 


4

















 


2.11.                        Section 6.11 (New Car Lots)
is hereby amended to evidence that the number “six (6)” shall now mean and read
“ten (10).”


 


2.12.                        Section 7.01
(Leverage Ratio) is amended to read as follows:


 


“Section 7.01.  Leverage Ratio.  The Borrower will at all times, calculated
as of the last day of each month, maintain a ratio of Funded Debt to EBITDA for
the trailing twelve (12) month period of no greater than 2.50 to 1.00.”


 


2.13.                        Section 7.02 (Fixed Charge
Coverage Ratio) is amended to read as follows:


 


“Section 7.02.  Fixed Charge Coverage Ratio.  Borrower will not permit the ratio of (a)
EBITDA to (b) Fixed Charges to be less than 1.50 to 1.00 as of the end of each
month for the trailing six (6) month period.”


 


2.14.                        A new Section 7.03 is
hereby added:


 


“Section 7.03.  Minimum Tangible Net Worth.  Borrower shall maintain at all times a
Minimum Adjusted Tangible Net Worth (to be defined as book net worth less
goodwill) as of the last day of each fiscal quarter each to the sum of (i) the
greater of (A) eighty-five percent (85%) of the Minimum Adjusted Tangible Net
Worth as of July 31, 2003 and (B) $57,000,000, plus (ii)
seventy-five percent (75%) of positive quarterly Net Income (after
July 31, 2003) and (iii) one hundred percent (100%) of any subsequent
equity issuances (after July 31, 2003).”


 


2.15.                        The term “Notes” shall now mean
the following promissory notes payable by Borrowers, together with extensions,
renewals and changes in form thereof: 
$5,000,000 Promissory Note payable to Arvest Bank; $5,000,000 Promissory
Note payable to Great Southern Bank; $2,500,000 Promissory Note payable to
Arkansas State Bank; $2,000,000 Promissory Note payable to First State Bank,
$1,000,000 Promissory Note payable to Bank of Arkansas, N.A.; and $24,000,000
Promissory Note payable to Bank of Oklahoma, N.A.


 


2.16.                        Any references to “Superior
Federal Bank” are hereby deleted, and Borrowers and Guarantor hereby release
Superior Federal Bank from any obligations and/or commitments under the Credit
Agreement; and furthermore, the obligations under the $7,500,000 Restructured
Promissory Note dated November 18, 2002, payable to Superior Federal Bank
are hereby released thereunder and substituted for those under the Restructured
Notes.


 


2.17.                        Section 10.13 is amended
to read as follows:


 


“Section 10.13.  Additional Banks.  Initially the aggregate Revolving Credit
Commitment shall equal $39,500,000; however, it is contemplated that the
aggregate Revolving Credit Commitment will increase to $45,000,000 upon the
addition of one or more Banks.  In
furtherance thereof, one or more Banks (“Additional Banks”) may


 


5

















 


be made a party hereto as determined by Agent, and any Bank made a
party hereto shall execute a Signature Page attached hereto and made a part
hereof, and thereafter shall be included as a Bank under the terms of this
Agreement.  By execution of the
Additional Bank Signature Page and upon receipt of an original executed
promissory note equal to the Additional Bank’s Revolving Credit Commitment,
each Additional Bank shall be bound by the terms of this Agreement and entitled
to all benefits of this Agreement as though such Additional Bank had signed on
the date of this Agreement; provided, however, that any Additional Banks shall
not receive payments of principal, interest or fees accrued hereunder or paid
by the Borrower prior to the date such Additional Bank executes its Signature
Page.”


 


3.                                       Conditions
Precedent.  The obligations of the
Banks to perform under the Credit Agreement, as amended hereby, are subject to
the satisfaction of the following.


 


3.1.                              Notes.  The Restructured and Renewed Notes shall be
executed and delivered to the Agent for distribution.


 


3.2.                              Corporate Action.  Certified (as of the date of this
Amendment), copies of all corporate action taken by each Borrower, including
resolutions of its Board of Directors authorizing the execution, delivery, and
performance of this Amendment and all documents executed and delivered in
connection herewith.


 


3.3.                              Incumbency and
Signature Certificate.  A
certificate (dated as of the date of this Amendment) of the secretary of each
Borrower certifying the names and true signatures of the officers of each
Borrower authorized to sign this Amendment and all related documents.


 


3.4.                              Opinion.  An opinion from each Borrower’s legal
counsel, substantially in the form of Schedule “3.4” attached
hereto.


 


3.5.                              Chattel Checks.  The current Chattel Checks shall be
delivered to Agent, evidencing no conflicting interests to those granted to
Agent.


 


3.6.                              Representations.  All representations and warranties contained
in Article IV of the Credit Agreement, Section 8 of the Security
Agreement, and Sections 24 through 29 of the Guaranty must be true and correct
in all material respects on and as of the date hereof other than any representation
or warranty that relates to a specific prior date and except to the extent that
the Agent and the Banks have been notified in writing by the Borrower that any
representation or warranty is not correct and the Majority Banks have
explicitly waived in writing compliance with such representation or warranty.


 


3.7.                              Default.  No Default or Event of Default has occurred
and is continuing, or will result from the execution and delivery of this
Amendment.


 


6

















 


4.                                       Representations
and Warranties.  Each of the
Borrowers and the Guarantor, respectively, hereby ratify and confirm all
representations and warranties set forth in Article IV of the Credit
Agreement, Section 8 of the Security Agreement, and Sections 24 through 29
of the Guaranty Agreement.


 


5.                                       Ratification.  Borrowers hereby ratify and confirm the
Credit Agreement, and all instruments, documents, and agreements executed by
and in connection therewith.


 


6.                                       Ratification
of Guaranty and Subordination Agreement. 
ACM-Texas hereby ratifies and confirms the Guaranty and the Crown
Sub-Debt Subordination Agreement, and agrees that they remain in full force and
effect, and that the “Obligations” defined in the Guaranty and the “Superior
Obligations” defined in the Crown Sub-Debt Subordination Agreement shall
additionally include the Restructured and Renewed Notes.  Furthermore, ACM-Texas and Agent agree the
“$7,500,000 Unsecured Note (“Subordinated Note”) dated January 15, 1999,
payable by Borrower to Subordinating Party, maturing January 15, 2004”
shall now mean and read “$10,000,000 Unsecured Note (“Subordinated Note”) dated
as of November 1, 2003, payable by Borrower to Subordinating Party,
maturing November 1, 2006.


 


7.                                       Agency
Fee.  Borrower agrees to pay Agent
an annual agency fee equal to $30,000, payable in twelve (12) monthly
installments of $2,500 on the first day of each month.


 


8.                                       Governing
Law.  This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State
of Arkansas.


 


9.                                       Multiple
Counterparts.  This Amendment may be
executed in any number of counterparts, and by different parties to this
Agreement in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.


 


10.                                 Costs,
Expenses and Fees.  Borrower agrees
to pay all costs, expenses and fees incurred by Banks in connection herewith,
including without limitation the reasonable attorney fees of Riggs, Abney, Neal,
Turpen, Orbison and Lewis.


 


	
   

  	
  “BORROWERS”

  
	
   

  	
   

  
	
   

  	
  AMERICA’S CAR MART, INC.,
  an

  Arkansas corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Mark D. Slusser, Vice President

  



 


7

















 


	
   

  	
  TEXAS CAR-MART, INC.,
  formerly

  Texarkana Car Mart, Inc., a Texas corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Mark D. Slusser, Vice President

  
	
   

  	
   

  
	
   

  	
  COLONIAL AUTO FINANCE, INC.,

  an Arkansas corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Tilman J. Falgout, III, President

  
	
   

  	
   

  
	
   

  	
  “GUARANTOR” and “SUBORDINATING

  PARTY”

  
	
   

  	
   

  
	
   

  	
  AMERICA’S CAR-MART, INC.,
  a Texas

  corporation, formerly known as Crown Group,

  Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Mark D. Slusser, Vice President

  



 


 


[Signature Page to Third Amendment to Agented
Revolving


Credit Agreement dated November 30,
2003]


 


8

















 


	
  “BANKS”

  	
   

  
	
   

  	
   

  
	
  Revolving Credit Commitment:

  	
  BANK OF OKLAHOMA, N.A.

  
	
  $24,000,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office

  	
   

  
	
  P.O. Box 2300

  	
   

  
	
  Tulsa, OK 74192

  	
  By

  	
   

  	
   

  
	
  Attn:  John Anderson

  	
   

  	
    Jeffrey R. Dunn, Vice
  President

  
	
  janderson@bokf.com

  	
   

  



 


9

















 


	
  Revolving Credit Commitment:

  	
  BANK OF ARKANSAS, N.A.

  
	
  $1,000,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office:

  	
   

  
	
  P.O. Box 1407

  	
   

  
	
  Fayetteville, AR 72702-1404

  	
  By

  	
   

  	
   

  
	
  Attention: Jeffrey R. Dunn

  	
   

  	
  Jeffrey R. Dunn, President & CEO

  
	
  jdunn@bokf.com

  	
   

  



 


10

















 


	
  Revolving Credit Commitment:

  	
  ARVEST BANK

  
	
  $5,000,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office:

  	
   

  
	
  801 Technology Drive

  	
   

  
	
  Little Rock, AR  72223

  	
  By

  	
   

  	
   

  
	
  Attention: Tom Wetzel

  	
   

  	
  Tom Wetzel, Senior Vice President

  
	
  rwetzel@arvest.com

  	
   

  



 


11

















 


	
  Revolving Credit Commitment:

  	
  GREAT SOUTHERN BANK

  
	
  $5,000,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office:

  	
   

  
	
  1451 E. Battlefield

  	
   

  
	
  Springfield, MO  65804

  	
  By

  	
   

  	
   

  
	
  Attn:  Gary Lewis

  	
   

  	
  Gary Lewis, Vice President

  
	
  glewis@greatsouthernbank.com

  	
   

  



 


12

















 


	
  Revolving Credit Commitment:

  	
  ARKANSAS STATE BANK

  
	
  $2,500,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office:

  	
   

  
	
  315 E. Main

  	
   

  
	
  Siloam Springs, AR  72761

  	
  By

  	
   

  	
   

  
	
  Attn:  Curtis Hutchines

  	
   

  	
  Art Morris, President and CEO

  
	
  amorris@arkstatebank.com

  	
   

  



 


13

















 


	
  Revolving Credit Commitment:

  	
  FIRST STATE BANK

  
	
  $2,000,000

  	
   

  
	
   

  	
   

  
	
  Principal Office and Lending Office:

  	
   

  
	
  620 Chestnut Street

  	
   

  
	
  Conway, AR 72703

  	
  By

  	
   

  	
   

  
	
  Attention: Michael Bynum

  	
   

  	
    Michael Bynum, Senior Vice
  President

  
	
  mbynum@fsbmail.com

  	
   

  



 


14

















 


	
   

  	
  “AGENT”

  
	
   

  	
   

  
	
   

  	
  BANK OF ARKANSAS, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   By

  	
   

  	
   

  
	
   

  	
   

  	
    Jeffrey R. Dunn, President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “PAYING AGENT”

  
	
   

  	
   

  
	
   

  	
  BANK OF OKLAHOMA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Jeffrey R. Dunn, Vice President

  
					



 


15

















 


Schedule “1.1”


 


(Restructured Promissory Note)


 

















 


Schedule “3.4”


 


(Opinion of Borrower’s Counsel)