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EXHIBIT 4.6
AMENDMENT XX. 0
XXXXXXXXX XX. 0 (this "AMENDMENT"), dated as of September 30, 2000,
between X.X. Xxxxxxx Mezzanine Fund, L.P. (the "PURCHASER"), a Delaware limited
partnership, and Mercury Air Group, Inc. (the "COMPANY"), to the Securities
Purchase Agreement (the "PURCHASE AGREEMENT"), dated as of September 10, 1999,
between the Purchaser and the Company.
W I T N E S S E T H:
WHEREAS, the Purchaser and the Company entered into the Purchase
Agreement (the Purchase Agreement, as amended by this Amendment, is hereinafter
referred to as the "AGREEMENT"), pursuant to which, among other things, the
Purchaser purchased from the Company (i) a subordinated promissory note due
September 9, 2006 in the principal amount of $24,000,000, and (ii) a warrant to
purchase 503,126 shares of common stock, $.01 par value per share, of the
Company; and
WHEREAS, the Purchaser and the Company desire to amend the Purchase
Agreement to change the Interest Coverage ratio financial covenant and the
definition of EBITDA therein.
NOW THEREFORE, in consideration of the premises set forth herein and for
other good and valuable consideration, the sufficiency and receipt of which is
hereby acknowledged, the Purchaser and the Company agree as follows:
ARTICLE 1
DEFINITIONS
1.1 PURCHASE AGREEMENT DEFINITION. All capitalized terms used in this
Amendment but not defined shall have the meanings given to them in the Purchase
Agreement. In the event of a conflict between the definitions contained in this
Amendment and those contained in the Purchase Agreement, the definitions
contained herein shall prevail.
ARTICLE 2
AMENDMENTS TO PURCHASE AGREEMENT
2.1 AMENDMENT TO DEFINITIONS. Section 1.1 of the Purchase Agreement
shall be amended to add the following definition of "Pro Forma Basis" following
the definition of "Pro Forma Balance Sheet":
"PRO FORMA BASIS" shall mean, in connection with any proposed
Permitted Acquisition, that the calculation of compliance with
the financial covenants set forth in Section 9.8 hereof by the
Company and its Subsidiaries (including the Person or asset(s) to
be acquired) shall be made by combining the audited historical
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financial results of such Person for the applicable test period
ending immediately prior to the date of such proposed Permitted
Acquisition with the audited historical financial results of the
Company and its Subsidiaries for such period as if such Permitted
Acquisition occurred on the first day of such period, adjusted in
the manner described in clauses (i), (ii) and (iii) below.
Following a Permitted Acquisition, Pro Forma Basis shall mean
that the calculation of compliance with the financial covenants
set forth in Section 9.8 hereof for the fiscal quarter in which
such Permitted Acquisition occurred and each of the three fiscal
quarters immediately following such Permitted Acquisition shall
be made by combining the audited historical financial results of
such Person for the portion of the applicable test period
occurring prior to the date of such Permitted Acquisition with
the audited historical financial results of the Company and its
Subsidiaries for such portion of such test period as if such
Permitted Acquisition occurred on the first day of such test
period, adjusted in the manner described in clauses (i), (ii) and
(iii) below. In each case, in the event that no audited
historical financial results are available or in the event that
such Permitted Acquisition is an asset acquisition, such
calculations shall be made with reference to such management
certified financial results of such Person (or the financial
results attributable to such assets) and of the Company and its
Subsidiaries as shall be reasonably acceptable to the Purchaser.
The following adjustments to such combined financial results
shall be made:
(i) all Indebtedness and any other balance sheet
adjustments incurred or made in connection with the Permitted
Acquisition shall be deemed to have been incurred or made on the
first day of the applicable test period, and all Indebtedness of
the Person acquired or to be acquired in such Permitted
Acquisition which was or will have been repaid in connection with
the consummation of the Permitted Acquisition shall be deemed to
have been repaid concurrently with the incurrence of the
Indebtedness incurred in connection with the Permitted
Acquisition;
(ii) all Indebtedness assumed to have been incurred
pursuant to the preceding clause (i) shall be deemed to have
borne interest at the sum of (a) the arithmetic mean of (x) the
Eurodollar Rate for Eurodollar Rate Loans having an Interest
Period of one month in effect on the first day of the Test
Period and (y) the Eurodollar Rate for Eurodollar Rate Loans
having an Interest Period of one month in effect on the last day
of the applicable test period plus (b) the Applicable Margin
then in effect (all terms and
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in this clause (ii) having the meanings ascribed thereto in the
Senior Credit Agreement); and
(iii) other reasonable cost savings, expenses and other
income statement or operating statement adjustments which are
attributable to the change in ownership and/or management
resulting from such Permitted Acquisition as may be approved by
the Purchaser in writing (which approval shall not be
unreasonably withheld) shall be deemed to have been realized on
the first day of the Test Period.
Notwithstanding and in lieu of the forgoing, after giving effect
to the Company's acquisitions of fixed based operators in
Birmingham, AL, Tulsa, OK and Fort Xxxxx, IN, EBITDA on a Pro
Forma Basis for the twelve (12) month period ending on each of
the dates set forth in the table below, for purposes of
calculating the financial covenants set forth in Section 9.8
shall be the actual EBITDA of the Company and its Subsidiaries
for such period as otherwise calculated in accordance with Item 1
of Schedule D to this Agreement plus the amount set forth
opposite such date in such table; provided that any other
calculations of compliance with the financial covenants set forth
in Section 9.8 (or components thereof) on a Pro Forma Basis shall
be determined in accordance with the foregoing definition:
12 Months Ending Consolidated EBITDA Increase
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September 30, 2000 $2,000,000
December 31, 2000 $1,350,000
March 31, 2001 $700,000
June 30, 2001 $217,000
2.2 AMENDMENTS TO SECTION 9.8.
(a) The introductory paragraph of Section 9.8 of the Purchase Agreement
is deleted in its entirety and the following is substituted therefore:
9.8 FINANCIAL COVENANTS. The Company covenants and agrees that
until payment in full of all Indebtedness hereunder and under the
Note, the Company shall comply with and shall cause each of its
Subsidiaries to comply with all covenants in this Section 9.8
applicable to such Person. Compliance with the covenants in this
Section 9.8 shall be determined on a consolidated basis in
accordance with GAAP consistently applied, unless explicitly
stated otherwise, and following a Permitted Acquisition shall be
determined on a Pro Forma Basis.
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(b) Section 9.8(a) of the Purchase Agreement is deleted in its entirety
and the following is substituted therefor:
INTEREST COVERAGE. The Company shall not permit Interest
Coverage for the Company and its Subsidiaries, on a consolidated
basis, for any twelve (12) month period ending on the last day of a
fiscal quarter during any of the periods set forth below to be less
than the ratio set forth below for such period:
Period Ratio
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Closing Date to and including June 30, 2000 3.125:1.00
July 1, 2000 to and including December 31, 2000 2.75:1.00
January 1, 2001 to and including March 31, 2001 3.25:1.00
April 1, 2001 to and including June 30, 2001 3.50:1.00
July 1, 2001 to and including June 30, 2002 4.00:1.00
July 1, 2002 and thereafter 4:00:1.00
"INTEREST COVERAGE" shall be calculated as illustrated on
Exhibit D.
2.3 AMENDMENT TO THE DEFINITION OF EBITDA.
Exhibit D to the Purchase Agreement is hereby amended by deleting
the definition of "EBITDA" as set forth in Section 1 thereof in its entirety and
substituting the following therefor:
EBITDA:
Net Income (or loss) of the Company and its Subsidiaries, for
the period in question, on a consolidated basis determined in
accordance with GAAP consistently applied, but excluding any
extraordinary gains or losses and any insurance proceeds
received by the Company or any of its Subsidiaries. $_________
Plus: Any provision for (or less any benefit from) income
and franchise taxes included in the determination of net
income _________
Interest Expense _________
Depreciation deducted in the determination of Net Income _________
Amortization deducted in determining Net Income _________
EBITDA $_________
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Purchaser as follows:
3.1 REPRESENTATIONS AND WARRANTIES IN THE PURCHASE AGREEMENT. The
representations and warranties of the Company contained in the Article 5 of the
Purchase Agreement were true, correct and complete as and when made.
3.2 AUTHORITY, ETC. The execution and delivery by the Company of this
Amendment and the performance by the Company of all of its agreements and
obligations under this Amendment and the Agreement (i) are within the corporate
authority of the Company, (ii) have been duly authorized by all necessary
corporate proceedings by the Company, (iii) do not conflict with or result in
any breach or contravention of any provision of law, statute, rule or regulation
to which the Company is subject or any judgment, order, writ, injunction,
license or permit applicable to the Company, and (iv) do not conflict with any
provision of the corporate charter or by-laws of, or any agreement or other
instrument binding upon, the Company.
3.3 ENFORCEABILITY OF OBLIGATIONS. This Amendment and the Agreement
constitute the legal, valid and binding obligations of the Company, enforceable
against it in accordance with their respective terms.
3.4 NO DEFAULT. After giving effect to this Amendment and the amendment
to the Senior Credit Agreement contemplated hereby, no default or Event of
Default exists under the Agreement or the Note.
ARTICLE 4
CONDITIONS TO EFFECTIVENESS
The effectiveness of this Amendment is conditioned upon the
(a) receipt by the Purchaser of an original counterpart signature
to this Amendment, duly executed and delivered by the Company;
(b) receipt by the Purchaser of a copy of the fully-executed
amendment to the Senior Credit Agreement, in form and substance satisfactory to
the Purchaser;
(c) receipt by the Purchaser, in form and substance satisfactory
to it, of the evidence of all corporate approval necessary in connection with
this Amendment; and
(d) the Purchaser shall be satisfied that, after giving effect to
this Amendment and the amendment to the Senior Credit Agreement, no default or
Event of Default shall then exist.
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ARTICLE 5
MISCELLANEOUS
5.1 CONTINUED EFFECTIVENESS. Notwithstanding anything contained herein,
the terms of this Amendment are not intended to and do not serve to effect a
novation as to the Purchase Agreement. The parties hereto expressly do not
intend to extinguish the Purchase Agreement. Instead, it is the express
intention of the parties hereto to reaffirm the indebtedness created under the
Purchase Agreement (including, without limitation, the Note) and the other
documents contemplated thereby and to reaffirm the rights and obligations
contained therein. The Purchase Agreement as amended hereby and each of the
other documents contemplated thereby shall remain in full force and effect.
Except as herein amended, the Purchase Agreement shall remain unchanged and in
full force and effect, and is hereby ratified in all respects. All of the
representations, warranties and covenants contained in the Purchase Agreement
and this Amendment shall survive the execution and delivery of this Amendment.
5.2 NOTICES. All notices, demands and other communications provided for
or permitted hereunder shall be made in writing and shall be by registered or
certified first-class mail, return receipt requested, telecopier, courier
service or personal delivery:
(a) if to the Purchaser:
X.X. Xxxxxxx Mezzanine Fund, L.P.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxxx
Xx. Xxxxxx X. X'Xxxxx
with a copy to:
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Xxxx Xxxx, Esq.
if to the Company:
Mercury Air Group, Inc.
0000 XxXxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xx. Xxxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, Esq.
with a copy to:
XxXxxxx, XxXxxxx & Xxxxx
00 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxxxx Xxxxx, Esq.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; when delivered by
courier, if delivered by commercial overnight courier service; if mailed, five
Business Days after being deposited in the mail, postage prepaid; and if
telecopied, when receipt is acknowledged.
5.3 SUCCESSORS AND ASSIGNS; THIRD PARTY BENEFICIARIES. This Amendment
shall inure to the benefit of and be binding upon the successors and permitted
assigns of the parties hereto.
5.4 REFERENCES. Any reference to the Purchase Agreement contained in any
notice, requisite, certificate, or other document executed concurrently with or
after the execution and delivery of this Amendment shall be deemed to include
the amendments contained in this Amendment unless the context shall otherwise
require.
5.5 SIGNATURES; COUNTERPARTS. Telefacsimile transmissions of any
executed original document and/or retransmission of any executed telefacsimile
transmission shall be deemed to be the same as the delivery of an executed
original. At the request of any party hereto, the other parties hereto shall
confirm telefacsimile transmissions by executing duplicate original documents
and delivering the same to the requesting party or parties. This Amendment may
be executed in any number of counterparts and by the parties hereto 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.
5.6 HEADINGS. The headings in this Amendment are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
5.7 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED IN
ACCORDANCE WITH, AND ENFORCED UNDER, THE LAW OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW OF SUCH STATE (INCLUDING GIVING
EFFECT TO GOL SECTION 5-1401).
5.8 SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstance, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, unless the provisions held
invalid, illegal or unenforceable shall substantially impair the benefits of the
remaining provisions hereof.
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5.9 CERTAIN EXPENSES. The Company will pay all expenses of the Purchaser
(including fees, charges and disbursements of counsel) in connection with this
Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their respective officers hereunto duly authorized as
of the date first above written.
MERCURY AIR GROUP, INC.
By:
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Name:
Title:
X.X. XXXXXXX MEZZANINE FUND, L.P.
By: Xxxxxxx XX, L.L.C.
By:
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Name:
Title: A Managing Member
[SIGNATURE PAGE TO AMENDMENT AGREEMENT]
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