Exhibit 10.33
FIFTH SUPPLEMENTAL INDENTURE
FIFTH SUPPLEMENTAL INDENTURE, dated as of December 20, 2000, among
Atlantic Express Transportation Corp., a New York corporation (the "Company"),
the Guarantors named herein, as guarantors, and The Bank of New York, a New York
banking corporation, as trustee (the "Trustee").
WHEREAS, the Company has duly issued its 10 3/4% Senior Secured Notes Due
2004 (the "Securities"), in the aggregate principal amount of $150,000,000
pursuant to an Indenture dated as of February 4, 1997, among the Company, the
Guarantors named therein and the Trustee, as amended by the First Supplemental
Indenture thereto dated as of August 14, 1997, the Second Supplemental Indenture
thereto dated as of December 12, 1997, the Third Supplemental Indenture, dated
as of October 28, 1998 and the Fourth Supplemental Indenture, dated as of April
28, 1999 (as so amended, the "Indenture"), and the Securities are outstanding on
the date hereof; and
WHEREAS, the Company proposes to receive a capital contribution (the
"Contribution") from its parent, Atlantic Express Transportation Group, Inc.
("AETG") of (i) all of the issued and outstanding shares of capital stock of
Atlantic Transit, Corp. ("ATC") and (ii) $10.0 million of additional equity; and
WHEREAS, in connection with the Contribution the Company will acquire ATC,
a New York corporation, Airport Services, Inc., a Massachusetts corporation,
Atlantic Express New England, Inc., a Massachusetts corporation, Atlantic
Express of California, Inc., a California corporation, Atlantic Express of
Illinois, Inc., an Illinois corporation, Atlantic Express of South Carolina,
Inc., a South Carolina corporation, Atlantic Paratrans of Arizona, Inc., a
Arizona corporation, Xxxxx Bus Service, Inc., a Massachusetts corporation, Groom
Transportation, Inc., a Massachusetts corporation, Xxxxx XxXxxxx Limo Service,
Inc., a Massachusetts corporation, X. Xxxx, Inc., a New York corporation,
XxXxxxxx Transportation, Inc., a Massachusetts corporation, Mountain Transit,
Inc., a Vermont corporation, X. Xxxxx Bus Service, Inc., a Massachusetts
corporation, Xxxxxxx Bus Service, Inc., a New York corporation, Xxxxxxx Capital
Corp., a New York corporation, Xxxxxxx Equity Corp., a New York corporation,
Xxxxxx X. XxXxxxxx & Son, Inc., a Massachusetts corporation, T-NT Bus Service,
Inc., a New York corporation, Transcomm, Inc., a Massachusetts corporation, and
Winsale, Inc., a New Jersey corporation (each a "Restricted Subsidiary," and
collectively, with ATC, the "Restricted Subsidiaries"); and
WHEREAS, in connection with the Contribution each of the Restricted
Subsidiaries will have its outstanding capital stock pledged to the Trustee; and
WHEREAS, in connection with the Contribution and pursuant to Section 10.12
of the Indenture, the Company shall cause each Restricted Subsidiary that is
formed or acquired after the date of the Indenture to become a Guarantor
thereunder and execute and deliver a supplemental indenture pursuant to which
such Restricted Subsidiaries shall unconditionally guarantee all of the
Company's Obligations as set forth in Section 10.7 of the Indenture; and
WHEREAS, Section 9.1 of the Indenture provides, among other things, that
the Company, the Guarantors and the Trustee may amend or supplement the
Indenture without the consent of any Holder to comply with Article 10.12 thereof
and execute a supplemental indenture; and
WHEREAS, in connection with the Contribution, the Company proposes to
establish a new $125.0 million credit facility (the "New Credit Facility") and
to repay all of the debt currently outstanding under (i) the Company's existing
$30.0 million credit facility (the "Revolving Credit Facility") and (ii) ATC's
existing $45.0 million credit facility, both of which will be terminated upon
such repayment (the Contribution and the related transactions, including the
consummation of the New Credit Facility and initial borrowings thereunder to
repay existing credit facilities and to fund the Tender Payment and the Consent
Payment (each as defined in the Statement (as defined below)), are hereinafter
referred to as the "Financing"); and
WHEREAS, Section 9.2 of the Indenture provides that the Company and the
Trustee may amend any provision of the Indenture (other than certain provisions
enumerated in Section 9.2 of the Indenture, none of which provisions are
implicated hereby) with the written consent of the Holders (as defined in the
Indenture) of at least a majority of the aggregate principal amount of the then
outstanding Securities and execute a supplemental indenture; and
WHEREAS, the Company solicited, and has received, consents upon the terms
and subject to the conditions set forth in the Offer to Purchase and Consent
Solicitation Statement dated November 23, 2000 (the "Statement") and the
accompanying Consent and Letter of Transmittal (the "Consent and Letter of
Transmittal"), from Holders representing at least a majority in aggregate
principal amount of its outstanding Securities to certain amendments described
therein to the Indenture; and
WHEREAS, it is provided in Section 9.4 of the Indenture that a
supplemental indenture becomes effective in accordance with its terms and
thereafter binds every Holder;
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. DEFINITIONS.
Capitalized terms not defined herein shall have the meaning given to such
terms in the Indenture.
SECTION 2. GUARANTEE BY RESTRICTED SUBSIDIARIES.
Each of the Restricted Subsidiaries unconditionally guarantees all of the
Company's Obligations as set forth in Section 10.7 of the Indenture in the same
manner and to the same extent as if it had executed the Indenture as one of the
parties thereto defined as the "Guarantors" therein.
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SECTION 3. AMENDMENTS TO THE INDENTURE.
Section 3.1 Amendment to the definition of "Revolving Credit Facility".
The definition of "Revolving Credit Facility" as set forth in Section 1.1
of the Indenture, is hereby amended and restated to read in its entirety as
follows:
"Revolving Credit Facility" means that certain credit facility dated
December 22, 2000 by and between Congress Financial Corporation, as lender, and
the Company and those Subsidiaries of the Company named therein, as borrowers,
in the amount of up to $125.0 million, as the same may be amended, modified,
renewed, refunded, replaced or refinanced from time to time, including (i) any
related notes, letters of credit, guarantees, collateral documents, instruments
and agreements executed in connection therewith, and in each case as amended,
modified, renewed, refunded, replaced or refinanced from time to time, and (ii)
any notes, guarantees, collateral documents, instruments and agreements executed
in connection with such amendment, modification, renewal, refunding, replacement
or refinancing.
Section 3.2 Amendment to the "Restricted Payments" covenant.
Section 4.7(a) of the Indenture is hereby amended and restated to read in
its entirety as follows:
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(i) declare or pay any dividend or make any distribution on account
of any Equity Interests of the Company or any of its Subsidiaries (other
than (x) dividends or distributions payable in Equity Interests (other
than Disqualified Stock) of the Company or (y) dividends or distributions
payable to the Company or any 90% Owned Subsidiary),
(ii) purchase, redeem or otherwise acquire or retire for value any
Equity Interest of the Company, and Subsidiary or any other Affiliate of
the Company (other than any such Equity Interest owned by the Company or
any Wholly Owned Subsidiary),
(iii) make any principal payment on, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness of the Company or
any Guarantor that is subordinated in right of payment to the Notes or
such Guarantor's Guarantee thereof, as the case may be, prior to any
scheduled principal payment, sinking fund payment or other payment at the
stated maturity thereof,
(iv) make any Restricted Investment, or
(v) make any payment or transfer any assets to, or on behalf of,
AETG or any of its Affiliates
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(all such payments and other actions set forth in clauses (i) through (v)
above being collectively referred to as "Restricted Payments").
Section 3.3 Amendment to the "Limitation on Incurrence of Indebtedness"
Covenant.
Section 4.9(b)(i) of the Indenture is hereby amended and restated to read
in its entirety as follows:
(b) The limitations of Section 4.9(a) shall not prohibit the
incurrence of:
(i) Indebtedness under the Revolving Credit Facility,
provided, that the aggregate principal amount of Indebtedness so
incurred on any date, together with all other Indebtedness incurred
pursuant to this clause (i) and outstanding on such date, shall not
exceed $125.0 million, less any repayments thereunder pursuant to
Section 4.10 hereof,
Section 3.4 Amendment to the "Limitation on Transactions with Affiliates"
covenant.
Section 4.11 of the Indenture is hereby amended by adding a new second
paragraph to the end thereof which reads in its entirety as follows:
In addition, with respect to any Affiliate Transaction with an aggregate
value of more than $1.0 million that is also an Asset Sale (i) the Company must
deliver to the Trustee opinions as to the fairness to the Company from a
financial point of view of such Asset Sale, issued by two investment banking
firms of national standing each with a net worth of at least $200.0 million as
set forth in its most recently published financial information and (ii) the
aggregate value of all such transactions in any one fiscal year may not exceed
10% of the Company's consolidated total assets as shown on the Company's audited
consolidated balance sheet as most recently delivered to the Trustee in
accordance with Section 4.3.
Section 3.5 Amendment to the "Limitation on Liens" covenant.
Section 4.12 of the Indenture is hereby amended and restated to read in
its entirety as follows:
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, create, incur, assume or suffer to exist (a) any Lien on
any asset (including, without limitation, all real, tangible or intangible
property) of the Company or any Restricted Subsidiary, whether now owned or
hereafter acquired, or on any income or profits therefrom, or assign or convey
any right to receive income therefrom, except (i) Liens securing Indebtedness
permitted to be incurred under the Revolving Credit Facility; provided, that the
Notes are secured by a second priority security interest in the assets subject
to such Liens, (ii) Purchase Money Liens, and (iii) Permitted Liens.
Section 3.6 Addition of the "Limitation on Acquisitions" covenant.
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A new Section 4.19 of the Indenture is hereby added to read in its
entirety as follows:
Section 4.19. Limitation on Acquisitions.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly acquire the assets or Capital Stock of
any Person that immediately prior to the time of such acquisition is not a
Restricted Subsidiary if the portion of the purchase price for such acquisition
funded through the permitted incurrence of Indebtedness, together with the
portion of the aggregate purchase prices for all other such acquisitions funded
through the permitted incurrence of Indebtedness during the same fiscal year,
would exceed $5.0 million (the "Acquisition Allowance"); provided, however, that
any unused portion of the Acquisition Allowance in a given fiscal year shall be
added to the following fiscal year's Acquisition Allowance. Notwithstanding the
foregoing, nothing in this Section shall be deemed to limit the ability of the
Company or any of its Restricted Subsidiaries to bid for, purchase or otherwise
acquire contracts that comply with Section 4.18 or to fund the expenditures
associated with such contracts.
Section 3.7 Addition of the "Annual Leverage Test" covenant.
A new Section 4.20 of the Indenture is hereby added to read in its
entirety as follows:
Section 4.20. Annual Leverage Test.
As of the last day of each fiscal year, the Company shall maintain a ratio
of (x) consolidated Indebtedness to (y) Consolidated EBITDA for such fiscal year
plus "New Equity" (as defined below) for such year (the "Annual Leverage Test")
not greater than (i) 5.35 to 1 for the fiscal year ending June 30, 2001, (ii)
5.20 to 1 for the fiscal year ending June 30, 2002, and (iii) 5.00 to 1 for the
fiscal year ending June 30, 2003.
For purposes of the Annual Leverage Test, "New Equity" shall mean the net
cash proceeds, plus, in the case of non-cash consideration, the fair market
value thereof as determined in good faith by the Board of Directors of the
Company, received by the Company as capital contributions, other than from a
Subsidiary, or from the issuance or sale, other than to a Subsidiary, of Equity
Interests of the Company (other than Disqualified Stock), during the fiscal year
as to which the Annual Leverage Test is being conducted and, at the election of
the Company, within 90 days of the end of such year (provided that the Company
must designate whether such amounts received in such 90 day period shall be
credited to the calculation of the Annual Leverage Test either for the
immediately preceding fiscal year or the fiscal year in which they are received,
but not both). With respect to the calculation of the Annual Leverage Test for
the fiscal year ending June 30, 2001, there shall be excluded the contribution
by AETG to the Company of Atlantic Transit, Corp. and its subsidiaries, and
there shall be included (i) only $2.0 million of the additional $10.0 million
being contributed by AETG on or about the date of the Fifth Supplemental
Indenture to the Indenture and (ii) any other New Equity received by the Company
following the date of the Fifth Supplemental Indenture to the Indenture and
prior to
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June 30, 2001 and 90 days thereafter (subject to the Company making the
previously referred to election and designation).
The Company shall deliver an Officers' Certificate to the Trustee within
15 Business Days of the filing of the Company's fiscal year-end financial
statements in accordance with Section 4.3(a), such Certificate to indicate
whether based on such year-end financial statements the Company met the Annual
Leverage Test as of the date of the latest balance sheet contained therein, and
showing in reasonable detail the calculations supporting such conclusion.
Notwithstanding any other provision of this Indenture, the failure of the
Company to meet the applicable ratio with respect to any Annual Leverage Test
shall not constitute a Default or an Event of Default; the sole consequence
thereof shall be that the interest rate payable per annum on the Securities
shall be increased by 0.50% per annum, commencing on the Interest Payment Date
immediately preceding the determination that such additional interest is
required.
SECTION 4. EFFECTIVE DATE.
This Fifth Supplemental Indenture shall become effective on the date (the
"Effective Date") on which the Financing is consummated; provided, that the
Company shall deliver to the Trustee (i) an Officers' Certificate, certifying
the consummation of the Financing, (ii) an Opinion of Counsel as to the
consummation of the Financing and such other matters as may be required by the
Indenture and (iii) such other documentation as the Trustee shall reasonably
request. This Fifth Supplemental Indenture shall have no force or effect prior
to the Effective Date.
SECTION 5. MISCELLANEOUS.
Section 5.1 Governing Law.
THIS FIFTH SUPPLEMENTAL INDENTURE SHALL BE CONSTRUED, INTERPRETED AND THE
RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY AND EACH GUARANTOR
HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT
SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT
SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY
SUIT, ACTION OR PROCEEDING ARISING OF OR RELATING TO THIS AGREEMENT, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY AND EACH
GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO
UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
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BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY
AND EACH GUARANTOR IRREVOCABLY CONSENTS, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, TO THE SERVICE OF PROCESS OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE COMPANY AT ITS
ADDRESS SET FORTH IN THE INDENTURE, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS
AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY HOLDER TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST THE COMPANY OR ANY GUARANTOR IN ANY OTHER
JURISDICTION.
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Section 5.2 Continuing Agreement.
Except as herein amended, all terms, provisions and conditions of the
Indenture, all Exhibits thereto and all documents executed in connection
therewith shall continue in full force and effect and shall remain enforceable
and binding in accordance with their terms.
Section 5.3 Conflicts.
In the event of a conflict between the terms and conditions of the
Indenture and the terms and conditions of this Fifth Supplemental Indenture,
then the terms and conditions of this Fifth Supplemental Indenture shall
prevail.
Section 5.4 Counterpart Originals.
The parties may sign any number of copies of this Fifth Supplemental
Indenture. Each signed copy shall be an original, but all of them together
represent the same agreement.
Section 5.5 Headings, Etc.
The Headings of the Sections of this Fifth Supplemental Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way modify or restrict any of the terms or provisions
hereof.
Section 5.6 Trustee's Disclaimer.
The recitals contained herein shall be taken as the statements of the
Company and the Guarantors and the Trustee assumes no responsibility for their
correctness. The Trustee makes no representation as to the validity or
sufficiency of this Fifth Supplemental Indenture.
[Signatures on following page]
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Fifth Supplemental Indenture as of the date first written above.
ATLANTIC EXPRESS TRANSPORTATION CORP.
By: /s/ Xxxxxxx Xxxxx
--------------------
Name: Xxxxxxx Xxxxx
Title: President
Attest:
/s/ Xxxxxx Xxxxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Chief Financial Officer
GUARANTORS
AIRPORT SERVICES, INC.
AMBOY BUS CO., INC.
ATLANTIC-CHITTENANGO REAL PROPERTY CORP.
ATLANTIC-CONN. TRANSIT, INC.
ATLANTIC EXPRESS COACHWAYS, INC.
ATLANTIC EXPRESS NEW ENGLAND, INC.
ATLANTIC EXPRESS OF CALIFORNIA, INC.
ATLANTIC EXPRESS OF ILLINOIS, INC.
ATLANTIC EXPRESS OF L.A. INC.
ATLANTIC EXPRESS OF MISSOURI, INC.
ATLANTIC EXPRESS OF NEW JERSEY, INC.
ATLANTIC EXPRESS OF PENNSYLVANIA, INC.
ATLANTIC EXPRESS OF SOUTH CAROLINA, INC.
ATLANTIC-XXXXXX, INC.
ATLANTIC MEDFORD, INC.
ATLANTIC PARATRANS, INC.
ATLANTIC PARATRANS OF ARIZONA, INC.
ATLANTIC PARATRANS OF COLORADO, INC.
ATLANTIC PARATRANS OF KENTUCKY INC.
ATLANTIC PARATRANS OF PENNSYLVANIA, INC.
ATLANTIC TRANSIT, CORP.
BLOCK 7932, INC.
BROOKFIELD TRANSIT INC.
CENTRAL NEW YORK COACH SALES & SERVICE, INC.
COURTESY BUS CO., INC.
XXXXX BUS SERVICE, INC.
GROOM TRANSPORTATION, INC.
G.V.D. LEASING CO., INC.
XXXXX XXXXXXX LIMO SERVICE, INC.
JERSEY BUS SALES, INC.
JERSEY BUSINESS LAND CO. INC.
X. XXXX, INC.
XXXXXXXX TRANSPORTATION, INC.
METRO AFFILIATES, INC.
METROPOLITAN ESCORT SERVICE, INC.
MERIT TRANSPORTATION CORP.
MIDWAY LEASING INC.
MOUNTAIN TRANSIT, INC.
XXXXXXX BUS SERVICE, INC.
XXXXXXX CAPITAL CORP.
X. XXXXX BUS SERVICE, INC.
XXXXXXX BUS SERVICE, INC.
XXXXXXX CAPITAL CORP.
XXXXXXX EQUITY CORP.
XXXXXX X. XXXXXXXX & SON, INC.
STATEN ISLAND BUS, INC.
TEMPORARY TRANSIT SERVICE, INC.
T-NT BUS SERVICE, INC.
TRANSCOMM, INC.
WINSALE, INC.
180 JAMAICA CORP.
201 WEST XXXXXXX REALTY, INC.
By: /s/ Xxxxxxx Xxxxx
--------------------
Name: Xxxxxxx Xxxxx
Title: President
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxxx Xxxxxxxx-Xxxxxx
----------------------------
Name: Xxxxx Xxxxxxxx-Xxxxxx
Title: Vice President
