Exhibit 10.3
AMENDED AND RESTATED SECURITY AGREEMENT
THIS AMENDED AND RESTATED SECURITY AGREEMENT (this "Agreement") dated
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as of February 10, 2003, is among CARMAX AUTO SUPERSTORES, INC. (the
"Borrower"); the other persons or entities which are listed on the signature
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pages hereof as debtors or which from time to time become parties hereto as
debtors (collectively, including the Borrower, the "Debtors" and individually
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each a "Debtor"); and DAIMLERCHRYSLER SERVICES NORTH AMERICA LLC ("DCSNA"), in
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its capacity as agent for the Lenders referred to below (in such capacity, the
"Agent").
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W I T N E S S E T H:
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WHEREAS, the Borrower, CarMax, Inc. (the "Company"), various financial
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institutions (the "Lenders") and the Agent have entered into an Amended and
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Restated Credit Agreement dated as of the date hereof (as amended or otherwise
modified from time to time, the "Credit Agreement"), pursuant to which the
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Lenders have agreed to make extensions of credit to the Borrower;
WHEREAS, each of the Debtors (other than the Borrower) has executed and
delivered a guaranty (as amended or otherwise modified from time to time, the
"Guaranty"; for the avoidance of doubt, such term includes the guaranty of the
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Company pursuant to the provisions of Section 14 of the Credit Agreement) of all
obligations of the Borrower under the Credit Agreement;
WHEREAS, the Debtors entered into a Security Agreement dated as of May
17, 2002 (the "Original Security Agreement") to secure their obligations under
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the Credit Agreement (in the case of the Borrower) and the Guaranty (in the case
of the Debtors other than the Borrower); and
WHEREAS, the obligations of the Borrower under the Credit Agreement and
the obligations of each other Debtor under the Guaranty are to be secured
pursuant to this Agreement;
NOW, THEREFORE, for and in consideration of any loan, advance or other
financial accommodation heretofore or hereafter made to the Borrower under or in
connection with the Credit Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Original Security Agreement is hereby amended and restated, and the parties
hereto agree, as follows:
1. Definitions. When used herein, (a) the terms, Account, Chattel
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Paper, Commercial Tort Claim, Deposit Account, Document, General Intangible,
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Instrument and Payment Intangible have the respective meanings assigned thereto
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in the UCC (as defined below); (b) capitalized terms used but not defined herein
are used as defined in the Credit Agreement; and (c) the following terms have
the following meanings (such definitions to be applicable to both the singular
and plural forms of such terms):
Assignee Deposit Account - see Section 4.
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Automobile Inventory means Motor Vehicles, and all accessions,
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additions, attachments, improvements, substitutions and replacements thereto and
therefor.
Collateral means, with respect to any Debtor, all property and rights
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of such Debtor in which a security interest is granted hereunder.
Collections means all payments and items of payment (including, without
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limitation, cash and Instruments) that are received by the Debtors from or on
behalf of any Obligor in payment of any amounts owed (including invoice prices,
finance charges, interest and all other charges, if any) in respect of any
Receivable or Related Asset, or otherwise applied to repay or discharge any
Receivable (including insurance payments that the Debtors apply in the ordinary
course of its business to amounts owed in respect of such Receivable and net
proceeds of sale or other disposition of repossessed goods that were the subject
of such Receivable).
Contracts means, with respect to any Receivable, the agreements
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(including, without limitation, Chattel Paper and Instruments) between the
Debtors and the related Obligors governing the terms and conditions of such
Receivable.
Contributed Receivable means a Receivable contributed by a Debtor to an
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SPE in connection with a Securitization.
Control Agreement Default means the occurrence of any of the following
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events: (a) any Event of Default or (b) any Unmatured Event of Default under
Section 11.1.1 or 11.1.4 of the Credit Agreement.
Default means the occurrence of any Event of Default.
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Intellectual Property means all past, present and future: trade secrets
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and other proprietary information; trademarks, service marks, trade names,
business names, designs, logos, indicia and other source and/or business
identifiers, and the goodwill of the business relating thereto and all
registrations or applications for registration which have heretofore been or may
hereafter be issued thereon throughout the world; copyrights (including
copyrights for computer programs) and copyright registrations or applications
for registration which have heretofore been or may hereafter be issued
throughout the world and all tangible property embodying the copyrights;
unpatented inventions (whether or not patentable); patent applications and
patents; industrial designs, industrial design applications and registered
industrial designs; license agreements related to any of the foregoing and
income therefrom; books, records, writings, computer tapes or disks, flow
diagrams, specification sheets, source codes, object codes and other physical
manifestations, embodiments or incorporations of any of the foregoing; the right
to xxx for all past, present and future infringements of any of the foregoing;
and all common law and other rights throughout the world in and to all of the
foregoing.
Liabilities means, as to each Debtor, all obligations (monetary or
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otherwise) of such Debtor under or in connection with the Credit Agreement, any
Note, the Guaranty, any other Loan Document and any other document or instrument
executed in connection therewith, in each case howsoever created, arising or
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evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due.
Obligor means a Person obligated to make payments on a Receivable.
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Purchased Receivable means a Receivable purchased by an SPE in a
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Securitization.
Receivable means an Account, Chattel Paper, Document, General
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Intangible, Instrument or Payment Intangible arising from the sale or lease of
Motor Vehicles.
Related Assets means, with respect to any Receivable: (a) all Contracts
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that relate to such Receivable; (b) the merchandise (including returned
merchandise), if any, relating to the sale which gave rise to such Receivable;
(c) all other security interests or liens and property subject thereto from time
to time purporting to secure payment of such Receivable, whether pursuant to the
Contract related to such Receivable or otherwise; (d) all UCC financing
statements covering any collateral securing payment of such Receivable; and (e)
all guarantees and other agreements or arrangements of whatever character from
time to time supporting or securing payment of such Receivable, whether pursuant
to the Contract related to such Receivable or otherwise.
Returned Goods means all right, title and interest of the Debtors in
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and to goods and/or merchandise, the sale of which gave rise to Receivables
(other than Transferred Receivables), that have been returned to, repossessed by
or foreclosed on by any Debtor.
Subject Receivables means any Receivables, other than Transferred
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Receivables and Third Party Sold Receivables.
Third Party Sold Receivables means Receivables sold by any Debtor to a
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Person not an SPE or an Affiliate in the ordinary course of business.
Transferred Receivables means all Purchased Receivables and Contributed
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Receivables.
UCC means the Uniform Commercial Code as in effect from time to time in
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the State of Michigan; provided that, as used in Section 10 hereof, "UCC" shall
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mean the Uniform Commercial Code as in effect from time to time in any
applicable jurisdiction.
2. Grant of Security Interest. As security for the payment of all
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Liabilities, each Debtor hereby assigns to the Agent for the benefit of the
Lenders, and grants to the Agent for the benefit of the Lenders a continuing
security interest in, the following, whether now or hereafter existing or
acquired:
(i) all of such Debtor's Automobile Inventory;
(ii) all of such Debtor's Subject Receivables;
(iii) all of such Debtor's rights against Manufacturers
arising out of the purchase of Automobile Inventory from such
Manufacturers;
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(iv) all of such Debtor's rights to receive payment (whether
arising from any sale or other disposition or any collection or
distribution) from any Person in connection with such Debtor's transfer
of a Receivable to such Person, including, without limitation, all
rights to payment pursuant to any agreement pursuant to which such
Receivable was transferred to such Person (but excluding any right of
such Debtor to receive payments in its capacity as servicer of a
Transferred Receivable or of a Contract related to a Transferred
Receivable);
(v) all Collections received by such Debtor on account of any
Subject Receivables; and
(vi) all Deposit Accounts into which any payment or Collection
on account of any Third Party Sold Receivable is paid, deposited or
credited;
together with all books, records, writings, data bases,
information and other property relating to, used or useful in
connection with, or evidencing, embodying, incorporating or referring
to any of the foregoing, and all proceeds, products, offspring, rents,
issues, profits and returns of and from, and any and all claims and/or
insurance payments arising out of the loss, nonconformity or
interference with the use of, defects or infringements of rights in, or
damage to, any of the foregoing; provided that:
(x) the property in which a security interest is
granted hereunder shall not include or continue into any
Transferred Receivable or Third Party Sold Receivable (or any
Related Asset related to such Transferred Receivable or Third
Party Sold Receivable);
(y) nothing in the foregoing clause (x) shall be
deemed to constitute a release by the Agent of: (A) its lien
on and security interest in the proceeds received by any
Debtor from or on behalf of any SPE or other Person for any
sale of Receivables and Related Assets (including, without
limitation, cash payments made by an SPE or other Person and
any note or other Instrument issued by an SPE or other Person
in favor of a Debtor in connection with any such sale), (B)
any lien, claim, encumbrance or security interest the Agent
may have in Subject Receivables or Collections of Subject
Receivables, (C) any lien, claim, encumbrance or security
interest the Agent may have as against any interest of a
Debtor in Returned Goods, and (D) any other Collateral not
constituting Transferred Receivables or Third Party Sold
Receivables (or Related Assets related to such Transferred
Receivables or Third Party Sold Receivables); and
(z) so long as any Ford Restriction exists, the
Collateral shall not include, and Kenosha shall be deemed not
to have granted a security interest in, any New Motor Vehicle
of the Ford, Lincoln or Mercury makes that is held by Kenosha.
3. Warranties. Each Debtor warrants that as of the date hereof (or as
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of the date such Debtor becomes a party hereto by delivering a counterpart
hereof) and as of each date on which the representations and warranties under
the Credit Agreement and the other Loan Documents shall be made: (i) no
financing statement (other than any which may have been filed on behalf of the
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Agent or in connection with liens expressly permitted by the Credit Agreement
("Permitted Liens")) covering any of the Collateral is on file in any public
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office; (ii) such Debtor is and will be the lawful owner of all Collateral in
which it has granted a security interest hereunder, free of all liens and claims
whatsoever, other than the security interest hereunder and Permitted Liens, with
full power and authority to execute this Agreement and perform such Debtor's
obligations hereunder, and to subject such Collateral to the security interest
hereunder; (iii) all information with respect to such Collateral set forth in
any schedule, certificate or other writing at any time heretofore or hereafter
furnished by such Debtor to the Agent or any Lender is and will be true and
correct in all material respects as of the date furnished; (iv) such Debtor's
state of incorporation / organization, organizational identification number,
chief executive office and principal place of business are as set forth on
Schedule I hereto (and such Debtor has not maintained its chief executive office
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and principal place of business at any other location at any time after January
1, 2001); (v) each other location where such Debtor maintains a place of
business is set forth on Schedule II hereto; (vi) except as set forth on
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Schedule III hereto, such Debtor is not now known and during the five years
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preceding the date hereof has not previously been known by any trade name; (vii)
except as set forth on Schedule III hereto, during the five years preceding the
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date hereof such Debtor has not been known by any legal name different from the
one set forth on the signature pages of this Agreement nor has such Debtor been
the subject of any merger or other corporate reorganization; (viii) such Debtor
is a corporation duly organized, validly existing and in good standing under the
laws of the state of its incorporation or a limited liability company duly
formed and validly existing under the laws of the state of its organization;
(ix) the execution and delivery of this Agreement and the performance by such
Debtor of its obligations hereunder are within such Debtor's corporate or
limited liability company powers, have been duly authorized by all necessary
corporate or limited liability company action, have received all necessary
governmental approval (if any shall be required), and do not and will not
contravene or conflict with any provision of law or of the charter or by-laws or
other organizational documents of such Debtor or of any agreement, indenture,
instrument or other document, or any judgment, order or decree, which is binding
upon such Debtor; (x) this Agreement is a legal, valid and binding obligation of
such Debtor, enforceable against such Debtor in accordance with its terms,
except that the enforceability of this Agreement may be limited by bankruptcy,
insolvency, fraudulent conveyance, fraudulent transfer, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law); (xi) such
Debtor is in compliance in all material respects with the requirements of all
applicable laws (including the provisions of the Fair Labor Standards Act),
rules, regulations and orders of every governmental authority; and (xii) each
Debtor that owns Motor Vehicles covered by certificates of title is and shall
continue to be in the business of selling goods of that kind.
4. Collections, etc. Until such time during the existence of a Default
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as the Agent shall notify such Debtor of the revocation of such power and
authority, each Debtor may, in the ordinary course of its business, at its own
expense, sell, lease or furnish under contracts of service any of the Automobile
Inventory normally held by such Debtor for such purpose, use and consume, in the
ordinary course of its business, any raw materials, work in process or materials
normally held by such Debtor for such purpose, and use, in the ordinary course
of its business (but subject to the terms of the Credit Agreement), the cash
proceeds of Collateral and other money which constitutes Collateral. The Agent
may, at any time that a Default exists, whether before or after any revocation
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of such power and authority or the maturity of any of the Liabilities, notify
any parties obligated on any of the Subject Receivables to make payment to the
Agent of any amounts due or to become due thereunder (but only if the applicable
Debtor shall have failed, within two Business Days after having been requested
in writing to do so by the Agent, to notify such parties to make payment of such
amounts to the Agent) and enforce collection of any of the Subject Receivables
by suit or otherwise and surrender, release or exchange all or any part thereof,
or compromise or extend or renew for any period (whether or not longer than the
original period) any indebtedness thereunder or evidenced thereby.
When any Debtor or any of its Affiliates (or any shareholder, director,
officer, employee, agent or those Persons acting for or in concert with such
Debtor or an Affiliate of such Debtor) shall receive or otherwise come into
possession or control of any monies, checks, notes, drafts or other payment
items (each, a "Payment Item") representing the purchase price of any Third
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Party Sold Receivable sold by such Debtor, then, except as otherwise permitted
in a writing signed by the Agent, such Debtor shall, or shall cause such
Affiliate or such other Person to, deposit the same in kind in precisely the
form in which such Payment Item was received (with all Payment Items endorsed if
necessary for collection) into a Deposit Account maintained in the United States
of America with respect to which the depositary bank has executed the Control
Agreement. Without limiting the foregoing, each Debtor selling any Third Party
Sold Receivable shall instruct the purchaser thereof to remit the purchase price
for such Receivable into such a Deposit Account. During the existence of a
Control Agreement Default, the Agent may issue the Notice (as defined in the
Control Agreement) pursuant to the Control Agreement.
Upon request by the Agent during the existence of a Default, each
Debtor will forthwith, upon receipt, transmit and deliver to the Agent, in the
form received, all cash, checks, drafts and other instruments or writings for
the payment of money (properly endorsed, where required, so that such items may
be collected by the Agent) which may be received by such Debtor at any time in
full or partial payment or otherwise as proceeds of any of the Collateral.
Except as the Agent may otherwise consent in writing, any such items which may
be so received by any Debtor will not be commingled with any other of its funds
or property, but will be held separate and apart from its own funds or property
and in express trust for the Agent until delivery is made to the Agent. Each
Debtor will comply with the terms and conditions of any consent given by the
Agent pursuant to the foregoing sentence.
During the existence of a Default, all items or amounts which are
delivered by any Debtor to the Agent on account of partial or full payment or
otherwise as proceeds of any of the Collateral shall be deposited to the credit
of a deposit account (each an "Assignee Deposit Account") of such Debtor with a
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financial institution selected by the Agent over which the Agent has sole
dominion and control, as security for payment of the Liabilities. No Debtor
shall have any right to withdraw any funds deposited in the applicable Assignee
Deposit Account. The Agent may, from time to time, in its discretion, and shall
upon request of the applicable Debtor made not more than once in any week, apply
all or any of the then balance, representing collected funds, in the Assignee
Deposit Account toward payment of the Liabilities, whether or not then due, in
such order of application as the Agent may determine, and the Agent may, from
time to time, in its discretion, release all or any of such balance to the
applicable Debtor.
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At any time that a Default exists, the Agent (or any designee of the
Agent) is authorized to endorse, in the name of the applicable Debtor, any item,
howsoever received by the Agent, representing any payment on or other proceeds
of any of the Collateral.
5. Certificates, Schedules and Reports. Each Debtor will from time to
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time, as the Agent may request, deliver to the Agent such schedules,
certificates and reports respecting all or any of the Collateral at the time
subject to the security interest hereunder, and the items or amounts received by
such Debtor in full or partial payment of any of the Collateral, as the Agent
may reasonably request. Any such schedule, certificate or report shall be
executed by a duly authorized officer of such Debtor and shall be in such form
and detail as the Agent may reasonably specify. Each Debtor shall immediately
notify the Agent of the occurrence of any event causing any loss or depreciation
in the value of its Automobile Inventory or other assets which could reasonably
be expected to have a Material Adverse Effect, and such notice shall specify the
amount of such loss or depreciation.
6. Agreements of the Debtors. Each Debtor (a) hereby authorizes the
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Agent to file (with or without the signature of such Debtor), and will upon
request of the Agent execute, such financing statements and other documents (and
pay the cost of filing or recording the same in all public offices reasonably
deemed appropriate by the Agent) and do such other acts and things, all as the
Agent may from time to time reasonably deem necessary or request, to establish
and maintain a valid security interest in the Collateral (free of all other
liens, claims and rights of third parties whatsoever, other than Permitted
Liens) to secure the payment of the Liabilities; (b) will keep all its
Automobile Inventory at, will not change its state of incorporation /
organization and will not maintain any place of business at any location other
than, its state of incorporation / organization and address(es) shown on
Schedules I and II hereto or in such other jurisdiction or at such other
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addresses of which such Debtor shall have given the Agent not less than thirty
(30) days' prior written notice; (c) will not change its type of organization
from that listed on the financing statements filed on behalf of the Agent or be
the subject of any merger or other corporate reorganization unless the
applicable Debtor shall have given the Agent not less than thirty (30) days'
prior written notice; (d) will keep its records concerning the Subject
Receivables in such a manner as will enable the Agent or its designees to
determine at any time the status of the Subject Receivables; (e) will furnish
the Agent such information concerning such Debtor and the Collateral as the
Agent may from time to time reasonably request; (f) will permit the Agent and
its designees, from time to time, on reasonable notice and at reasonable times
and intervals during normal business hours (or at any time without notice during
the existence of a Default) to inspect such Debtor's Automobile Inventory, and
to inspect, audit and make copies of and extracts from all records and other
papers in the possession of such Debtor pertaining to the Collateral; (g) will,
upon request of the Agent, stamp on its records concerning the Collateral, and
add on all Chattel Paper and Instruments constituting a portion of the
Collateral, a notation, in form satisfactory to the Agent, of the security
interest of the Agent hereunder; (h) except for the sale or lease of Automobile
Inventory in the ordinary course of its business and for dispositions permitted
by Section 9.10 of the Credit Agreement, will not sell, lease, assign or create
or permit to exist any Lien on any Collateral other than Permitted Liens; (i)
will at all times keep all of its Automobile Inventory insured as required by
Section 9.3 of the Credit Agreement and cause all policies covering the
Collateral to provide that loss thereunder shall be payable to the Agent as its
interest may appear (it being understood that (A) so long as no Default shall be
existing, the Agent shall deliver any proceeds of such insurance which may be
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received by it to such Debtor and (B) whenever a Default shall be existing, the
Agent may apply any proceeds of such insurance which may be received by it
toward payment of the Liabilities, whether or not due, in such order of
application as the Agent may determine), and such policies or certificates
thereof shall, if the Agent so requests, be deposited with or furnished to the
Agent; (j) will take such actions as are reasonably necessary to keep its
Automobile Inventory in good repair and condition; (k) will take all steps
reasonably necessary to protect, preserve and maintain all of its rights in the
Collateral; (l) will keep all of the Automobile Inventory in the United States;
(m) will not change its name without providing thirty (30) days' prior written
notice to the Agent; (n) if such Debtor has any Commercial Tort Claim against
any Manufacturer arising out of the purchase by such Debtor of Automobile
Inventory from such Manufacturer, and the amount of such Commercial Tort Claim
exceeds $500,000, such Debtor shall provide to the Agent a detailed description
of such Commercial Tort Claim and this Agreement shall be amended to include a
specific reference (sufficient under Section 9-108 of the UCC) to such
Commercial Tort Claim; and (o) acknowledges and agrees that it is not authorized
to file any financing statement in favor of the Agent without the prior written
consent of the Agent and that it will not do so without the prior written
consent of the Agent, subject to such Debtor's rights under Section 9-509(d)(2)
of the UCC.
Any expenses incurred in protecting, preserving or maintaining any
Collateral shall be borne by the applicable Debtor, and each Debtor shall
promptly, upon demand, reimburse and indemnify the Agent for all reasonable
costs and expenses incurred by the Agent in the exercise of its rights under
this Section 6. Notwithstanding the foregoing, the Agent shall have no
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obligation or liability regarding the Collateral or any thereof by reason of, or
arising out of, this Agreement, except to the extent caused by the gross
negligence or wilful misconduct of the Agent.
7. Default. During the existence of a Default, the Agent may exercise
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from time to time any right or remedy available to it under applicable law. Each
Debtor agrees, in case of Default, to assemble, at its expense, all its
Automobile Inventory that is not then located at one of the inventory locations
listed on the inventory detail report most recently delivered pursuant to
Section 9.1.10 of the Credit Agreement and make it available to the Agent at one
or more of such locations. Any notification of intended disposition of any of
the Collateral required by law shall be deemed reasonably and properly given if
given at least ten days before such disposition. Any proceeds of any disposition
by the Agent of any of the Collateral may be applied by the Agent to payment of
expenses in connection with the Collateral, including Attorney Costs, and any
balance of such proceeds may be applied by the Agent toward the payment of such
of the Liabilities, and in such order of application, as the Agent may from time
to time elect.
8. License of Intellectual Property. Each Debtor hereby grants to the
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Agent a non-exclusive and royalty-free right and license to use, during the
existence of a Default, all of such Debtor's Intellectual Property throughout
the world, solely for the purpose of enabling the Agent to exercise its rights
and remedies hereunder including, without limitation, the right to use the
Intellectual Property in connection with the disposition or maintenance of
Automobile Inventory as the Agent deems necessary or appropriate. The Agent
shall have the right to grant sublicenses to others to use the Intellectual
Property during the existence of a Default and solely to enable such
sublicensees to exercise any rights and remedies of the Agent under this
Agreement, provided each such sublicensee agrees to be bound by an agreement
similar to the next sentence. The Agent agrees that it will, when exercising its
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rights under any Intellectual Property license hereunder, comply in all material
respects with quality standards and specifications employed by the Debtors in
commerce prior to the Initial Closing Date.
9. Limitation on Duty in Respect of Collateral. Beyond the exercise of
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reasonable care in the custody and preservation thereof, the Agent will have no
duty as to any Collateral in its possession or control or in the possession or
control of any sub-agent or bailee or any income therefrom or as to the
preservation of rights against prior parties or any other rights pertaining
thereto. The Agent shall be deemed to have exercised reasonable care in the
custody and preservation of any of the Collateral in its possession if it takes
such action for that purpose as any applicable Debtor requests in writing, but
failure of the Agent to comply with any such request shall not of itself be
deemed a failure to exercise reasonable care, and no failure of the Agent to
preserve or protect any right with respect to such Collateral against prior
parties, or to do any act with respect to the preservation of such Collateral
not so requested by any Debtor, shall be deemed of itself a failure to exercise
reasonable care in the custody or preservation of such Collateral.
To the extent that applicable law imposes duties on the Agent to
exercise remedies in a commercially reasonable manner, each Debtor acknowledges
and agrees that it is not commercially unreasonable for the Agent (a) to fail to
incur expenses reasonably deemed significant by the Agent to prepare Collateral
for disposition or otherwise to complete raw material or work-in-process into
finished goods or other finished products for disposition, (b) to fail to obtain
third party consents for access to Collateral to be disposed of, or to obtain
or, if not required by other law, to fail to obtain governmental or third party
consents for the collection or disposition of Collateral to be collected or
disposed of, (c) to fail to exercise collection remedies against account debtors
or other Persons obligated on Collateral or to remove liens or encumbrances on
or any adverse claims against Collateral, (d) to exercise collection remedies
against account debtors and other Persons obligated on Collateral directly or
through the use of collection agencies and other collection specialists, (e) to
advertise dispositions of Collateral through publications or media of general
circulation, whether or not the Collateral is of a specialized nature, (f) to
contact other Persons, whether or not in the same business as the Debtors, for
expressions of interest in acquiring all or any portion of the Collateral, (g)
to hire one or more professional auctioneers to assist in the disposition of
Collateral, whether or not the collateral is of a specialized nature, (h) to
dispose of Collateral by utilizing Internet sites that provide for the auction
of assets of the types included in the Collateral or that have the reasonable
capability of doing so, or that match buyers and sellers of assets, (i) to
dispose of assets in wholesale rather than retail markets, (j) to disclaim
disposition warranties, including, without limitation, any warranties of title,
merchantability or fitness for a particular purpose, (k) to purchase insurance
or credit enhancements to insure the Agent against risks of loss, collection or
disposition of Collateral, or to provide to the Agent a guaranteed return from
the collection or disposition of Collateral or (l) to the extent deemed
appropriate by the Agent, to obtain the services of brokers, investment bankers,
consultants and other professionals to assist the Agent in the collection or
disposition of any of the Collateral. Each Debtor acknowledges that the purpose
of this Section is to provide non-exhaustive indications of what actions or
omissions by the Agent would not be commercially unreasonable in the Agent's
exercise of remedies against the Collateral and that other actions or omissions
by the Agent shall not be deemed commercially unreasonable solely on account of
not being specifically referred to in this Section. Without limitation upon the
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foregoing, nothing contained in this Section shall be construed to grant any
right to a Debtor or to impose any duties on the Agent that would not have been
granted or imposed by this Agreement or by applicable law in the absence of this
Section.
10. General. All notices hereunder shall be in writing (including
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facsimile transmission) and shall be sent to the applicable party at its address
shown below its signature hereto or at such other address as such party may, by
written notice received by the other parties, have designated as its address for
such purpose. Notices sent by facsimile transmission shall be deemed to have
been given when sent; notices sent by mail shall be deemed to have been given
three Business Days after the date when sent by registered or certified mail,
postage prepaid; and notices sent by hand delivery or overnight courier service
shall be deemed to have been given when received.
Each of the Debtors agrees to pay all reasonable expenses, including
Attorney Costs, paid or incurred by the Agent or any Lender in endeavoring to
collect the Liabilities of such Debtor, or any part thereof, and in enforcing
this Agreement against such Debtor, and such obligations will themselves be
Liabilities.
No delay on the part of the Agent in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
the Agent of any right or remedy shall preclude other or further exercise
thereof or the exercise of any other right or remedy.
This Agreement shall remain in full force and effect until all
Liabilities have been paid in full and all Commitments have terminated. If at
any time all or any part of any payment theretofore applied by the Agent or any
Lender to any of the Liabilities is or must be rescinded or returned by the
Agent or such Lender for any reason whatsoever (including the insolvency,
bankruptcy or reorganization of any Debtor), such Liabilities shall, for the
purposes of this Agreement, to the extent that such payment is or must be
rescinded or returned, be deemed to have continued in existence, notwithstanding
such application by the Agent or such Lender, and this Agreement shall continue
to be effective or be reinstated, as the case may be, as to such Liabilities,
all as though such application by the Agent or such Lender had not been made.
This Agreement shall be construed in accordance with and governed by
the laws of the State of Michigan applicable to contracts made and to be
performed entirely within such State (except to the extent that perfection, the
effect of perfection or nonperfection, or the priority of the security interests
granted hereunder may be determined by the UCC of a different jurisdiction).
Whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Agreement.
The rights and privileges of the Agent hereunder shall inure to the
benefit of its successors and assigns.
This Agreement may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, and each such counterpart
shall be deemed to be an original, but all such counterparts shall together
10
constitute one and the same Agreement. At any time after the date of this
Agreement, one or more additional Persons may become parties hereto by executing
and delivering to the Agent a counterpart of this Agreement together with
supplements to the Schedules hereto setting forth all relevant information with
respect to such party as of the date of such delivery. Immediately upon such
execution and delivery (and without any further action), each such additional
Person will become a party to, and will be bound by all the terms of, this
Agreement.
EACH DEBTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF MICHIGAN AND OF THE
UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN FOR THE
PURPOSE OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT. EACH DEBTOR FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, TO THE ADDRESS SET FORTH BELOW ITS SIGNATURE HERETO (OR SUCH OTHER
ADDRESS AS IT SHALL HAVE SPECIFIED IN WRITING TO THE AGENT AS ITS ADDRESS FOR
NOTICES HEREUNDER) OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
MICHIGAN. EACH DEBTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.
EACH OF EACH DEBTOR, THE AGENT AND (BY ACCEPTING THE BENEFITS HEREOF)
EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY NOTE, ANY
OTHER LOAN DOCUMENT AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR
THEREWITH OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH
ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE
TRIED BEFORE A COURT AND NOT BEFORE A JURY.
11
IN WITNESS WHEREOF, this Agreement has been duly executed as of the day
and year first above written.
DEBTORS:
CARMAX, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: Executive VP and CFO
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
CARMAX AUTO SUPERSTORES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: Executive VP and CFO
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
CARMAX AUTO SUPERSTORES WEST
COAST, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: Chairman, President and CFO
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
S-1
KENOSHA AUTOMOTIVE, LLC
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: CFO, Vice President and Treasurer
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
CARMAX AUTO MALL, LLC
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: CFO, Vice President and Treasurer
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
CARMAX OF LAUREL, LLC
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------------
Title: CFO, Vice President and Treasurer
----------------------------------------
Address:
--------------------------------------
--------------------------------------
--------------------------------------
Attention:____________________________________
Telephone:____________________________________
Facsimile:____________________________________
S-2
AGENT:
DAIMLERCHRYSLER SERVICES NORTH
AMERICA LLC, as Agent
By: /s/ X. X. Xxxxxx
-------------------------------------------
Title: Vice President Credit
----------------------------------------
Address:
00000 Xxxxxxx Xxxx
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000-0000
CIMS 000-00-00
Attention: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-3
Signature page for the Amended and Restated
Security Agreement (the "Security
Agreement") dated as of February 10, 2003
among CARMAX AUTO SUPERSTORES, INC., CARMAX,
INC. (the "Company"), various subsidiaries
of the Company and DAIMLERCHRYSLER SERVICES
NORTH AMERICA LLC, as Agent.
The undersigned is executing a counterpart
hereof for purposes of becoming a party
hereto (and attached to this signature page
are supplements to the Schedules to the
Security Agreement setting forth all
relevant information with respect to the
undersigned):
[ADDITIONAL DEBTOR]
By:___________________________________________
Title:________________________________________
Address:
Attention:
Telephone:
Facsimile:
S-4
Signature page for the Amended and Restated
Security Agreement (the "Security
Agreement") dated as of February 10, 2003
among CARMAX AUTO SUPERSTORES, INC., CARMAX,
INC. (the "Company"), various subsidiaries
of the Company and DAIMLERCHRYSLER SERVICES
NORTH AMERICA LLC, as Agent.
The undersigned is executing a counterpart
hereof as of November 1, 2004 for purposes
of becoming a party hereto (and attached to
this signature page are supplements to the
Schedules to the Security Agreement setting
forth all relevant information with respect
to the undersigned):
CARMAX AUTO SUPERSTORES TEXAS, LP
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxx, Executive Vice
President & Chief Financial Officer
Address: 0000 Xxx Xxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-5
Signature page for the Amended and Restated
Security Agreement (the "Security
Agreement") dated as of February 10, 2003
among CARMAX AUTO SUPERSTORES, INC., CARMAX,
INC. (the "Company"), various subsidiaries
of the Company and DAIMLERCHRYSLER SERVICES
NORTH AMERICA LLC, as Agent.
The undersigned is executing a counterpart
hereof as of November 1, 2004 for purposes
of becoming a party hereto (and attached to
this signature page are supplements to the
Schedules to the Security Agreement setting
forth all relevant information with respect
to the undersigned):
CARMAX AUTO SUPERSTORES CALIFORNIA, LLC
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxx
President & Chief Financial Officer
Address: 0000 Xxx Xxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-6
Signature page for the Amended and Restated
Security Agreement (the "Security
Agreement") dated as of February 10, 2003
among CARMAX AUTO SUPERSTORES, INC., CARMAX,
INC. (the "Company"), various subsidiaries
of the Company and DAIMLERCHRYSLER SERVICES
NORTH AMERICA LLC, as Agent.
The undersigned is executing a counterpart
hereof as of November 1, 2004 for purposes
of becoming a party hereto (and attached to
this signature page are supplements to the
Schedules to the Security Agreement setting
forth all relevant information with respect
to the undersigned):
CARMAX BUSINESS SERVICES, LLC
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxx, Executive Vice
President & Chief Financial Officer
Address: 0000 Xxx Xxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-7
SCHEDULE I
TO AMENDED AND RESTATED SECURITY AGREEMENT
JURISDICTION OF INCORPORATION / ORGANIZATION
ORGANIZATIONAL IDENTIFICATION NUMBER / CHIEF EXECUTIVE OFFICES
-------------- -------------- ------ ----- --------- -------
-----------------------------------------------------------------------------------------------------------------------
Name of Entity Jurisdiction of Organizational ID Chief Executive Office Principal Place of
Incorporation Number Business
-----------------------------------------------------------------------------------------------------------------------
CarMax, Inc. Virginia 0473081-8 0000 Xxx Xxxx 0000 Xxx Xxxx
Xxxx Xxxxx, XX 00000 Xxxx Xxxxx, XX 00000
CarMax Auto Virginia 0074154-6 0000 Xxx Xxxx 0000 Xxx Xxxx
Xxxxxxxxxxx, Xxx. Xxxx Xxxxx, XX 00000 Xxxx Xxxxx, XX 00000
CarMax Auto California C1977320 0000 Xxxxxxx Xxxxxx 0000 Xxxxxxx Xxxxxx
Xxxxxxxxxxx Xxxx Xxxxxx, XX 00000 Xxxxxx, XX 00000
Coast, Inc.
Kenosha Virginia S031635-8 0000 Xxx Xxxx 0000 000xx Xxx.
Automotive, LLC Xxxx Xxxxx, XX 00000 Xxxxxxx, XX 00000
CarMax Auto Virginia S031643-2 0000 Xxx Xxxx 0000 000xx Xxx.
Xxxx, XXX Xxxx Xxxxx, XX 00000 Xxxxxxx, XX 00000
CarMax of Laurel, LLC Virginia S031548-3 0000 Xxx Xxxx 0000 Xxxxxxxxx Xxxxx
Xxxx Xxxxx, XX 00000 Xxxxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------
JURISDICTION OF INCORPORATION / ORGANIZATION
ORGANIZATIONAL IDENTIFICATION NUMBER / CHIEF EXECUTIVE OFFICES*
-------------- -------------- ------ ----- --------- -------
-----------------------------------------------------------------------------------------------------------------------
Name of Entity Jurisdiction of Organizational ID Chief Executive Office Principal Place of
Incorporation Number Business
-----------------------------------------------------------------------------------------------------------------------
CarMax Business Xxxxxxxx XX 0000000 0000 Xxx Xxxx 0000 Xxx Xxxx
Xxxxxxxx, XXX Xxxx Xxxxx, XX 00000 Xxxx Xxxxx, XX 00000
CarMax Auto California 200412110302 0000 Xxx Xxxx 0000 Xxxxxxx Xxxxxx
Xxxxxxxxxxx Xxxxxxxxxx, Xxxx Xxxxx, XX 00000 Xxxxxx, XX 00000
LLC
CarMax Auto Texas 800340997 0000 Xxx Xxxx 3100 Spur 000
Xxxxxxxxxxx Xxxxx, XX Xxxx Xxxxx, XX 00000 Xxxxxx, XX 00000
-----------------------------------------------------------------------------------------------------------------------
*supplemental information provided as of November 1, 2004
I-1
SCHEDULE II
TO AMENDED AND RESTATED SECURITY AGREEMENT
ADDRESSES
---------
CarMax Auto Superstores, Inc. 0000 Xxxxxxxxx Xxxx
Xxxxxxx Xxxxx, XX 00000
0000 Xxxxxxxxx Xxxx.
Xxxxxxxxxx, XX 00000
0000 Xxxxx Xxxx 00
Xxxxx, XX 00000
0000 XX 00xx Xxxxx
Xxxxx, XX 00000
0000 Xxxxx Xxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
00000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx, XX 00000
0000 Xxxxxx Xxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
0000 Xxxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
0000 Xxxxx Xxxx Xxxxxxx
Xxxxxxxxxxx, XX 00000
000 Xxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
0000 Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
0000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
000 Xxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
00000 Xxxxx Xxx Xxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
0000 Xxxx 00xx Xxxxx
Xxxxxxxxxxxx, XX 00000
0000 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000
0000 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000
8949569 01903541
II-1
CarMax Auto Superstores, Inc. 00000 Xxxxxxxxx Xxxx
(xxxx'x) Xxxxxxxxx, XX 00000
00000 Xxxxxxxxxxxx Xxxx
Xxxxx Xxxxx, XX 00000
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
0000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
00000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
00000 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
0000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
0000 Xxxxxxxx Xxxxxxxxx
Xx. Xxxxx, XX 00000
00000 XXX Xxxxxxx
Xxxxxxx, XX 00000
00000 Xxxx Xxxxxxx
Xxxxxxx, XX 00000
00000 Xxxxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
0000 Xxxxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
00000 Xxxxx Xxxxxxx
Xxxxxxx, XX 00000
0000 Xxxx 000
Xxxxxx, XX 00000
0000 Xxxx Xxxxx Xxxxxxx
Xxxxx, XX 00000
0000 Xxxxxxxxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
00000 Xxxx Xxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
II-2
CarMax Auto Superstores, Inc. 00000 Xxxxxxx Xxxxx
(xxxx'x) Xxxxxxxx, XX 00000
0000 000xx Xxxxxx
Xxxxxxx, XX 00000
CarMax Auto Superstores West Coast, Inc. 0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
0000 Xxxx Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
0000 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
ADDRESSES*
----------
CarMax Business Services, LLC 0000 Xxx Xxxx
Xxxx Xxxxx, XX 00000
CarMax Auto Superstores California, LLC 0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
CarMax Auto Superstores Texas, LP 0000 Xxxx 000
Xxxxxx, XX 00000
*supplemental information provided as of November 1, 2004
II-3
SCHEDULE III
TO AMENDED AND RESTATED SECURITY AGREEMENT
TRADE NAMES, PRIOR LEGAL NAMES, ETC.
Name of Entity Trade Names (for previous 5 years)
--------------------------------------------------------------------------------
CarMax Auto Superstores, Inc. CarMax Auto Finance
First North American Credit
First North American Credit Corp.
Name of Entity Legal Names (for previous 5 years)
--------------------------------------------------------------------------------
CarMax Auto Superstores West Coast, Inc. C-Max Auto Superstores, Inc.
CarMax Funding Corporation, a Virginia corporation, was merged into CarMax Auto
Superstores, Inc. on February 28, 1999.
III-1
