May 12, 2004
Evergreen Aircraft Sales and leasing Co.
0000 XX Xxxxx Xxxx Xxxx
XxXxxxxxxxx, XX 00000
RE: AMENDMENT TO LOAN DOCUMENTS
Dear Ladies & Gentlemen:
This Letter Agreement will serve to confirm certain agreements of Xxxxxxx Xxxxx
Business Financial Services, Inc. ("MLBFS") and Evergreen Aircrafts Sales and
leasing Co. ("Customer") with respect to: (i) that certain WCMA LOAN AGREEMENT
NO. 54F-07164 between MLBFS and Customer (including any previous amendments and
extensions thereof), and (ii) all other agreements between MLBFS and Customer or
any party who has guaranteed or provided collateral for Customer's obligations
to MLBFS (a "Guarantor") in connection therewith (collectively, the "Loan
Documents"). Capitalized terms used herein and not defined herein shall have the
meaning set forth in the Loan Documents.
Subject to the terms hereof, effective as of the "Effective Date" (as defined
below), the Loan Documents are hereby amended as follows:
1. Deleted 4.3(h) and replace as follows:
(h) FIXED CHARGE COVERAGE RATIO: Customer's and Business Guarantor's
aggregate Fixed Charge Coverage Ratio, measured on a quarter-end basis, shall be
at least the amount set forth in the following table for the applicable period
set forth opposite thereto:
------------------------------------- ---------------------------------------
Applicable Ratio Applicable Period
================================================================================
1.00:1.00 For the 6 month period
ending August 31, 2004
================================================================================
For the 9 month period
1.00:1.00 ending November 30, 2004
================================================================================
For the 12 month period
1.10:1.0 ending February 28, 2005
================================================================================
1.15:1.0 For the 12 month period
ending the last day of each
fiscal quarter of Parent
after February 28, 2005
--------------------------------------------------------------------------------
2. Add to the end of Section 4.3(h):
(i) CAPITAL EXPENDITURES: Customer and the other Credit Parties shall not
make "Capital Expenditures" in any fiscal year of Evergreen International
Aviation, Inc. in excess of $75,000,000, but at least $10,000,000 of each
$75,000,000 must be funded with Indebtedness. For the purposes hereof, (i) the
term "Capital Expenditures" shall mean, with respect to any Person for any
period, the aggregate of all expenditures by such Person and it subsidiaries
during such period that are capital expenditures as determined in accordance
with GAAP and reflected as additions to property, plant and equipment on a
consolidated statement of cash flows of such Person, whether such expenditures
are paid in cash or financed, except to the extent that such expenditures are
financed with proceeds of insurance, condemnation awards or asset sales which
are permitted to be used or re-invested by Customer and the Credit Parties in
accordance with the terms of the Loan Documents, and (ii) the term
"Indebtedness" shall mean (a) all obligations for borrowed money, (b) all
obligations evidenced by bonds, debentures, notes or other similar instruments
and all reimbursement or other obligations in respect of letters of credit,
bankers acceptances, interest rate swaps, or other financial products, (c) all
obligations as a lessee under any lease that is required to be capitalized for
financial reporting purposes in accordance with GAAP, (d) all obligations or
liabilities of others secured by a lien or security interest on any asset of a
Person or its subsidiary, irrespective of whether such obligation or liability
is assumed, (e) all obligations to pay the deferred purchase price of assets
(other than trade payables incurred in the ordinary course of business and
repayable in accordance with customary trade practices), (f) all obligations
owing under any agreement for the purpose of hedging any Credit Parties exposure
to fluctuations in interest or exchange rates, loan, credit exchange, security
or currency valuations or commodity prices, and (g) any obligation guaranteeing
or intended to guarantee (whether directly or indirectly guaranteed, endorsed,
co-made, discounted, or sold with recourse) any obligation of any other Person
that constitutes Indebtedness under any of the foregoing clauses;
notwithstanding the foregoing, the term "Indebtedness" shall not mean a WCMA
Loan or WCMA Loans.
(j) MINIMUM EBITDA: Customer's and Business Guarantors' consolidated
EBITDA, measured on a quarter-end basis, shall be at least the amount set forth
in the following table for the applicable period set forth opposite thereof:
----------------------------------- ----------------------------------------
Amount Applicable Period
================================================================================
$40,000,000 For the 6 month period
ending August 31, 2004
================================================================================
For the 9 month period
$67,000,000 ending November 30, 2004
================================================================================
For the 12 month period
$97,000,000 ending February 28, 2005
================================================================================
================================================================================
$100,000,000 For the 12 month period
ending the last day of each
fiscal quarter of Parent
after February 28, 2005
--------------------------------------------------------------------------------
3. Customer and Business Guarantors shall no longer be required to maintain
an aggregate Minimum Tangible Net Worth Covenant as of the Effective Date.
4. Customer and Business Guarantors shall no longer be required to maintain
an aggregate interest Coverage Ratio Covenant as of the Effective Date.
Except as expressly amended hereby, the Loan Documents shall continue in
full force and effect upon all of their terms and conditions.
By their execution of this Letter Agreement, the below-named Guarantors
hereby consent to the foregoing modifications to the Loan Documents, and hereby
agree that the "Obligations" under their respective Unconditional Guaranty
and/or agreements providing collateral shall extend to and include the
Obligations of Customer under the Loan Documents, as amended hereby.
Customer and said Guarantors acknowledge, warrant and agree, as a primary
inducement to MLBFS to enter into this Agreement, that: (a) no Default or Event
of Default has occurred and is continuing under the Loan Documents; (b) each of
the warranties of Customer in the Loan Documents are true and correct as of the
date hereof and shall be deemed remade as of the date hereof; (c) neither
Customer nor any of said Guarantors have any claim against MLBFS or any of its
affiliates arising out of or in connection with the Loan Documents or any other
matter whatsoever; and (d) neither Customer nor any or said Guarantors have any
defense to payment of any amounts owing, or any right of counterclaim for any
reason under, the Loan Documents.
Provided that no Event of Default, or event which with the giving of
notice, passage of time, or both, would constitute an Event of Default, shall
then have occurred and be continuing under the terms of the Loan Documents, and
the condition specified above shall have been met to our satisfaction, the
amendments and agreements in this Letter Agreement will become effective on the
date (the "Effective Date") upon which: (a) Customer and the Guarantors shall
have executed and returned the duplicate copy of this Letter Agreement and the
other documents enclosed herewith; and (b) an officer of MLBFS shall have
reviewed and approved this Letter Agreement and such other documents as being
consistent in all respects with the original internal authorization hereof.
Notwithstanding the foregoing, if Customer and the Guarantors do not
execute and return the duplicate copy of this Letter Agreement and said other
documents within 14 days from the date hereof, or if for any other reason (other
than the sole fault of MLBFS) the Effective Date shall not occur within said
14-day period, then all of said amendments and agreements will, at the sole
option of MLBFS, be void.
Very truly yours,
XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES INC.
By: /S/ XXXXXX X. XXXXXXX
---------------------------------------
Xxxxxx X. Xxxxxxx
Senior Credit Manager
ACCEPTED:
EVERGREEN AIRCRAFT SALES AND LEASING CO.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
APPROVED:
EVERGREEN INTERNATIONAL AIRLINES, INC.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
APPROVED:
EVERGREEN HOLDINGS, INC.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
EVERGREEN AVIATION GROUND LOGISTICS ENTERPRISE, INC.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
EVERGREEN HELICOPTERS, INC.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
EVERGREEN AIR CENTER, INC.
By: /S/ XXXXXX XXXXXXXX
------------------------
Printed Name: XXXXXX XXXXXXXX
Title: SECRETARY
EVERGREEN AGRICULTURAL ENTERPRISES, INC.
By: /S/ XXXX X. XXXXX
----------------------
Printed Name: XXXX X. XXXXX
Title: TREASURER
