EXHIBIT 10.23(b)
SECOND AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Amendment"),
dated as of the 31st day of December, 1997, made by and between
FLEET CAPITAL CORPORATION, a Rhode Island corporation (successor by
merger with Fleet Capital Corporation, a Connecticut corporation, which was
formerly known as Shawmut Capital Corporation) (the "Lender"),
ATLANTIC COAST AIRLINES, a California corporation (the "Borrower"), and
ATLANTIC COAST AIRLINES, INC., a Delaware corporation (the "Parent";
the Borrower and the Parent being collectively called the "Loan Parties");
to the Loan and Security Agreement, dated October 12, 1995, as
previously amended by First Amendment thereto, dated June 1, 1997 (the "Loan
Agreement"). All capitalized terms used herein without definition shall have the
meanings ascribed to such terms in the Loan Agreement.
RECITALS
RECITALS RECITALS RECITALS
A. Pursuant to the Loan Agreement, and upon the terms and subject to
the conditions contained therein, the Lender has made available to the Borrower
a $20,000,000 revolving line of credit evidenced by the Loan Agreement.
B. The Loan Parties have requested that the Loan Agreement be further
amended to (a) increase the aggregate amount of the Letter of Credit Obligations
which may be outstanding at any time from the sum of $10,500,000 to the sum of
$13,500,000, and (b) reduce the amount of the Fixed Bond Letter of Credit
Guaranty Reserve, and the Lender has agreed to such requests, provided, among
other things, the Loan Agreement and the other Loan Documents are amended as
herein provided.
C. To accomplish the foregoing purposes, the parties hereto are
mutually desirous of further amending the Loan Agreement as set forth herein.
STATEMENT OF AGREEMENT
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
expressly acknowledged, the Loan Parties and the Lender hereby agree as follows:
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ARTICLE I
AMENDMENTS TO LOAN AGREEMENT
The Loan Agreement is hereby amended as follows:
1.1 Letters of Credit; Letter of Credit Guaranties. Section 1.4.1,
Issuance of Letters of Credit and Letter of Credit Guaranties, is amended in its
entirety to read as follows:
"1.4.1. Issuance of Letters of Credit and Letter of Credit
Guaranties. Lender agrees, for so long as no Default or Event of
Default exists and subject to the provisions of Section 9 below, to
issue its, or cause to be issued its Affiliate's, Letters of Credit and
Letter of Credit Guaranties, provided that the aggregate amount of the
Letter of Credit Obligations outstanding at any time shall not exceed
$13,500,000 and, without the prior written consent of Lender, no Letter
of Credit or Letter of Credit Guaranty may have an expiration date that
is after the last day of the Original Term or the then applicable
Renewal Term."
1.2 Letter of Credit and Letter of Credit Guaranty Fees. Section 2.2.3,
Letter of Credit and Letter of Credit Guaranty Fees, is amended in its entirety
to read as follows:
"2.2.3. Letter of Credit and Letter of Credit Guaranty Fees. Borrower shall
pay the following fees for all Letters of Credit and Letter of Credit Guaranties
issued by Lender and its Affiliates pursuant to Section 1.4.1 hereof:
(i) Upon issuance of the Bond Letter of Credit and
the Bond Letter of Credit Guaranty, fees to Bank in the
amounts and on the dates as set forth in Section 2.03 of the
Reimbursement Agreement;
(ii) Upon issuance of each other Letter of Credit and
Letter of Credit Guaranty:
(a) an issuance fee to Lender for the
account of both Lender and its Affiliate that issues
such other Letter of Credit equal to (1) in the case
of those three (3) Letters of Credit, numbers
9721204, 9721205 and 9721206, issued by Bank on
December 31, 1997 in favor of NationsBanc Leasing
Corporation as beneficiary in the original undrawn
amounts of $750,000, $750,000 and $875,000,
respectively, and the Letter of Credit Guaranties
issued by Lender with respect thereto, one and
one-quarter percent (1.25%) per annum of the undrawn
amount of each such Letter of Credit, and (2) in the
case of each other Letter of Credit and Letter of
Credit Guaranty, the greater of (a) $500 or (b) one
and one-half percent (1.5%) per annum of the undrawn
amount of such other Letter of Credit, in each case
payable in advance upon the issuance of each other
Letter of Credit and Letter of Credit Guaranty and on
each extension of the stated termination date thereof
for so long as such other Letter of Credit and Letter
of Credit Guaranty is outstanding; and
(b) the reasonable and customary charges
from time to time of the issuer of such other Letter
of Credit with respect to the issuance, notification,
amendment, transfer, administration, cancellation and
conversion of, and drawings under, such other Letter
of Credit, all of which shall be payable to Lender
for the account of such issuer.
All issuance fees in connection with each Letter of Credit and
Letter of Credit Guaranty as set forth in Sections 2.2.3 (i)(a) and
(ii)(a) hereof shall be deemed fully earned upon the issuance of the
Letter of Credit and Letter of Credit Guaranty and shall not be subject
to rebate or proration upon the termination of this Agreement for any
reason."
1.3 Fixed Bond Letter of Credit Guaranty Reserve. The definition of "Fixed Bond
Letter of Credit Guaranty Reserve" set forth in Appendix A, General Definitions, to the Loan Agreement,
is amended in its entirety to read as follows:
"Fixed Bond Letter of Credit Guaranty Reserve - for so long as
the Bond Letter of Credit and the Bond Letter of Credit Guaranty is
outstanding, a reserve established by Lender in the amount of
$1,980,000."
ARTICLE II
REPRESENTATIONS AND WARRANTIES
The Loan Parties each hereby represents and warrants to the Lender
that:
2.1 Compliance with the Loan Agreement and Other Loan Documents. As of
the execution of this Amendment, each of the Loan Parties is in compliance with
all of the terms and provisions set forth in the Loan Agreement and in the other
Loan Documents to be observed or performed by each of the Loan Parties, except
where the failure of the Loan Parties to comply has been waived in writing by
the Lender.
2.2. Representations in Loan Agreement and other Loan Documents. The
representations and warranties of the Loan Parties set forth in the Loan
Agreement and the other Loan Documents are true and correct in all material
respects except for changes in the nature of a Loan Party's business or
operations that would render the information in any exhibit attached to the Loan
Agreement either inaccurate, incomplete or misleading, so long as the Lender has
consented to such changes or such changes are not expressly prohibited by the
Loan Agreement.
2.3. No Event of Default. No Default or Event of Default exists.
ARTICLE III
MODIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENT OF OBLIGATIONS
3.1 Modification of Loan Document The Loan Agreement and each of the
other Loan Documents are amended to provide that any reference to the Loan
Agreement in the Loan Agreement or any of the other Loan Documents shall mean
the Loan Agreement as amended by this Amendment, and as it is further amended,
restated, supplemented or modified from time to time.
3.2. Acknowledgments by the Loan Parties. To induce the Lender to enter
into this Amendment, each Loan Party acknowledges and agrees with the Lender
that as of the opening of business on December 31, 1997, the aggregate principal
balance owing on the Revolving Loans outstanding under the Loan Agreement was in
the sum of zero, and the aggregate amount of Letters of Credit and Letter of
Credit Guaranties outstanding was in the sum of $12,485,932.00 and that all such
Obligations outstanding are owed to the Lender without any offset, deduction,
defense or counterclaim of any nature in favor of either Loan Party.
ARTICLE IV
GENERAL
4.1. Full Force and Effect. As expressly amended hereby, the Loan
Agreement shall continue in full force and effect in accordance with the
provisions thereof. As used in the Loan Agreement, "hereinafter", "hereto",
"hereof" or words of similar import, shall, unless the context otherwise
requires, mean the Loan Agreement as amended by this Amendment.
4.2 Applicable Law. This Amendment shall be governed by and construed
in accordance with the internal laws and judicial decisions of the State of
North Carolina.
Consolidated Adjusted Net
Earnings From Operations Per Annum Fee
4.3 Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one and the same instrument.
4.4 Expenses. The Borrower shall reimburse the Lender for all
reasonable fees and expenses (legal or otherwise) incurred by the Lender in
connection with the preparation, negotiation, execution and delivery of this
Amendment and all other agreements and documents referred to herein or
contemplated hereby.
4.5. Headings. The headings in this Amendment are for the purpose of reference only and
shall not affect the construction of this Amendment.
4.6 Waiver of Jury Trial. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, THE LOAN PARTIES AND THE LENDER EACH WAIVES THE RIGHT TO TRIAL BY JURY IN
ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR
RELATED TO THIS AMENDMENT, THE LOAN AGREEMENT OR THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS RELATED HERETO OR THERETO.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered on the date first above written.
Borrower:
ATLANTIC COAST AIRLINES
By:________________________________________
Title:__________________________________
ATTEST:
----------------------------
_________ - Secretary
[CORPORATE SEAL]
Parent:
ATLANTIC COAST AIRLINES, INC.
By:________________________________________
Title:__________________________________
ATTEST:
----------------------------
_________ - Secretary
[CORPORATE SEAL]
Accepted in Charlotte, North Carolina
Lender:
FLEET CAPITAL CORPORATION
By:_______________________________________
Title:___________________________________
