EXH-10.38
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT is entered into as of August _____, 2001, by and
among CONGRESS FINANCIAL CORPORATION, a Delaware corporation ("Lender"),
Atlantic Express Transportation Corp., a New York corporation, Amboy Bus Co.,
Inc., a New York corporation, Atlantic-Chittenango Real Property Corp., a New
York corporation, Atlantic-Conn Transit, Inc., a Connecticut corporation,
Atlantic Express Coachways, Inc., a New Jersey corporation, Atlantic-Xxxxxx,
Inc., a New York corporation, Atlantic Medford, Inc., a New York corporation,
Atlantic Paratrans, Inc., a New York corporation, Atlantic Paratrans of
Kentucky, a Kentucky corporation, Block 7932, Inc., a New York corporation,
Atlantic Express of Missouri, a Missouri corporation, Atlantic Express of
Pennsylvania, a Delaware corporation, Brookfield Transit, Inc., a New York
corporation, Courtesy Bus Co., Inc., a New York corporation, GVD Leasing, Inc.,
a New York corporation, 180 Jamaica Corp., a New York corporation, X. Xxxx,
Inc., a New York corporation, Jersey Business Land Co., Inc., a New Jersey
corporation, Merit Transportation, Inc., a New York corporation, Metropolitan
Escort Service, Inc., a New York corporation, Midway Leasing, Inc., a New York
corporation, Xxxxxxx Bus Service, Inc., a New York corporation, Xxxxxxx Capital
Corp., a New York corporation, Xxxxxxx Equity Corp., a New York corporation,
Staten Island Bus, Inc., a New York corporation, Atlantic Express of L.A., Inc.,
a New York corporation, Central New York Coach Sales and Service, Inc., a New
York corporation, Jersey Bus Sales, Inc., a New Jersey corporation, Atlantic
Paratrans of Colorado, Inc., a Colorado corporation, Atlantic Paratrans of
Pennsylvania, Inc., a Pennsylvania corporation, Atlantic Express of New Jersey,
a New Jersey corporation, Atlantic Paratrans of Arizona, an Arizona corporation,
Temporary Transit Service, Inc., a New York corporation, 201 West Xxxxxxx
Realty, Inc., a California corporation, Atlantic Transit, Corp., a New York
corporation, Airport Service, Inc., a Massachusetts corporation, Atlantic
Express New England, Inc., a Massachusetts corporation, Atlantic Express of
California, Inc., a California corporation, Atlantic Express of Illinois, an
Illinois corporation, Atlantic Express of South Carolina, Inc., a South Carolina
corporation, Xxxxx Bus Service, Inc., a Massachusetts corporation, Groom
Transportation, Inc., a Massachusetts corporation, Xxxxx XxXxxxx Limo Service,
Inc., a Massachusetts corporation, XxXxxxxx Transportation, Inc., a
Massachusetts corporation, Mountain Transit, Inc., a Vermont corporation, X.
Xxxxx Bus Service, Inc., a Massachusetts corporation, Xxxxxx X. XxXxxxxx & Son,
Inc., a Massachusetts corporation, T-NT Bus Service, Inc., a New York
corporation, Transcomm, Inc., a Massachusetts corporation, Winsale, Inc., a New
Jersey corporation (each individually, an "Existing Borrower" and any two or
more collectively, "Existing Borrowers"), and Wrightholm Bus Line, Inc., a
Vermont corporation ("Wrightholm", and together with the Existing Borrowers,
hereinafter collectively referred to as "Borrowers"). Capitalized terms not
defined herein shall have the meanings given to such term in the Loan Agreement
(as defined below).
R E C I T A L S:
WHEREAS, (i) Existing Borrowers, Atlantic Express Transportation
Corp., a
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New York corporation (the "Parent"), and Lender are parties to that certain Loan
and Security Agreement, dated December 22, 2000 (the "Loan Agreement"), pursuant
to which Lender has made and may continue to make loans and other financial
accommodations to Borrowers, and (ii) each Existing Borrower is a party to the
Guarantee dated December 22, 2000 (the "Borrower Guarantee"), to guarantee to
Lender the payment and performance of each other Borrower's obligations to
Lender;
WHEREAS, Wrightholm is a wholly owned subsidiary of Parent acquired
by Parent since the date of the Loan Agreement;
WHEREAS, under the Loan Agreement Parent is permitted to acquire a
new subsidiary only if such subsidiary becomes a "Borrower" under the Loan
Agreement and grants to Lender a first priority security interest in certain of
its property;
WHEREAS, Existing Borrowers have requested Lender, and Lender is
willing to agree, on the terms and conditions hereof, to amend the Loan
Agreement and the other Financing Agreements to include Wrightholm as a
"Borrower" or a "Guarantor" thereunder and to provide for additional borrowing
availability based upon certain eligible assets of Wrightholm; and
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, the parties hereto do hereby agree as follows:
1. Additional Borrower.
Wrightholm hereby joins in and becomes a party to the Loan Agreement
as a Borrower and, as a Borrower, hereby joins in and becomes a party to each
other Financing Agreement to which the Borrowers are parties (including, without
limitation, the Borrower Guarantee), and Wrighthom hereby assumes and agrees to
be bound by and to perform and discharge each of the Obligations and each other
duty, covenant, agreement, liability, and obligation of the Borrowers under the
Loan Agreement and the Financing Agreements, in each case with the same effect
as if Wrightholm had been named as a Borrower in and had executed and delivered
the Loan Agreement and such other Financing Agreements. All references in any of
the Financing Agreements to the terms "Borrowers", "Debtors", us, we", "our" or
any other term referring to the same shall be deemed and each such reference is
hereby amended to mean and include Wrightholm.
2. Acknowledgment. Each of the Borrowers (including, without
limitation, Wrightholm) hereby acknowledges, confirms and agrees that Existing
Borrowers are indebted to Lender for Obligations as of the close of business on
June 30, 2001, in respect of the loans and other credit accommodations made
pursuant to the Financing Agreements in the aggregate principal amount of
approximately $116,689,626, together with interest accrued and accruing thereon,
and together with costs, expenses, fees (including attorneys' fees and legal
expenses) and
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other charges now or hereafter owed by Existing Borrowers to Lender, all of
which are unconditionally owing by Existing Borrowers to Lender, without offset,
defense or counterclaim of any kind, nature and description whatsoever.
3. Conditions Precedent. The agreements set forth herein shall not
be effective unless and until each of the following conditions precedent is
satisfied as determined by Lender:
(a) each of the Borrowers shall have executed and delivered to
Lender this Amendment;
(b) Lender shall have received evidence that the collateral agent
for the Senior Notes has a valid and perfected security interest in and lien on
the assets of Wrightholm;
(c) Lender shall have received evidence, including, without
limitation, lien and title searches in form and substance satisfactory to
Lender, that after giving effect to the amendments affected hereby, and the
consummation of the other transactions contemplated hereby, Lender has a valid
and perfected first priority security interest in and lien on the Collateral and
any other property which is intended to be security for the Obligations;
(d) Borrowers shall have delivered to Lender copies of requisite
corporate action and proceedings in connection with this Amendment, in form and
substance satisfactory to Lender and, where requested by Lender or Lender's
counsel, certified by appropriate corporate officers or governmental
authorities;
(e) Lender shall have received from Wrightholm evidence of insurance
and loss payee endorsements required under the Financing Agreements, in form and
substance acceptable to Lender, and certificates of insurance policies and/or
endorsements naming Lender as loss payee;
(f) Lender shall have received, in form and substance satisfactory
to Lender, all such consents, acknowledgments, amendments and other agreements
from third parties which Lender may deem necessary or desirable in order to
permit, protect and perfect, and/or to assure the continuing full force and
effectiveness of, after giving effect to amendment and agreements contained in
this Amendment, (i) Lender's security interests in and liens on the Collateral
or any other property which is intended to be security for the Obligations, and
(ii) any consents or agreements with which Lender has been provided, or which
have been made in Lender's favor or for Lender's benefit at any time in
connection with the financing provided by Lender pursuant to the Financing
Agreements;
(g) Lender shall have received an opinion or opinions of counsel, in
form and substance and from counsel satisfactory to Lender, covering such
matters relating to this Amendment, the transactions contemplated hereby, and
the other Financing Agreements and such other matters as Lender shall request;
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(h) each of the representations and warranties of Borrowers set
forth in the Loan Agreement and each of the other Financing Agreements is true
and correct in all material respects as of such date; and
(i) immediately prior to, and immediately after giving effect to,
the amendments and agreements set forth herein, there shall exist no Event of
Default or event or condition which, with the giving of notice or the passage of
time or both, would constitute an Event of Default.
4. Expenses. Each of the Borrowers confirms that under the Loan
Agreement, it shall pay Lender's attorneys' fees and reasonable expenses
incurred in connection with this Amendment and the transactions contemplated
hereby.
5. Ratification. Each of the Borrowers hereby ratify, assume, adopt
and agree to be bound by the Financing Agreements and agree to pay all of the
Obligations arising thereunder in accordance with the terms of the Financing
Agreements. Except as expressly set forth herein, the Loan Agreement and the
other Financing Agreements are not modified hereby and each shall remain in full
force and effect in accordance with the respective provisions thereof on the
date hereof, and the Loan Agreement and the other Financing Agreements are each
in all respects ratified and affirmed. Lender's agreements herein shall not be
construed to require Lender to make any amendment to the Loan Agreement or any
other Financing Agreements, on any other occasion, regardless of the similarity
of circumstances. The amendments contained herein shall not be construed to
limit or waive any of Lender's rights and remedies under the Financing
Agreements with respect to any Event of Default occurring hereafter or any
currently existing Event of Default not expressly waived herein.
6. Representations and Warranties. Without limiting any other
provision of this Amendment, and as an inducement to Lender to enter into this
Amendment, (a) each of the Borrowers hereby: (i) represents, warrants and agrees
that the Loan Agreement, this Amendment and the other Financing Agreements to
which it is a party, after giving effect to all amendments and agreements
contained herein, constitute its valid and binding obligations, enforceable
against it in accordance with their respective terms, without defenses, offsets
or counterclaims; and (ii) represents and warrants that (A) each of the
representations and warranties of such Borrower or Guarantor set forth in the
Loan Agreement and the other Financing Agreements is true and correct in all
material respects, as of the date hereof; and (B) after giving effect to this
Amendment, there exists no Event of Default or event or condition which, with
the giving of notice or the passage of time or both, would constitute an Event
of Default, and (b) Wrightholm represents, warrants and agrees that: (i) it is a
corporation duly organized and in existence and good standing under the laws of
the state of its incorporation, and is duly qualified or registered as a foreign
corporation and in good standing in all other jurisdictions where the nature and
extent of the business transacted by it or its ownership of property makes such
qualification or registration necessary; and (ii) the execution, delivery and
performance of this Amendment and the other Financing Agreements to which it is
a party, and all borrowings or guarantees contemplated hereby and thereby, after
giving effect to all amendments and agreements contained herein, are within its
power, have been duly authorized by all necessary corporate or
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other action and are not in contravention of the terms of any of its articles of
incorporation, by-laws or other organizational documentation or any law,
regulation, decree, order, judgement, indenture, agreement or undertaking to
which it is a party or by which it or any of its property is bound.
7. Governing Law. This Amendment shall be construed in accordance
with and governed by the laws of State of New York, without giving effect to any
conflicts of laws provisions of such State that would require the application of
the laws of a different jurisdiction.
8. Headings. The headings indicated herein are inserted for
convenience only and shall not be considered a part this Amendment, nor in any
way limit the construction or interpretation of this Amendment.
9. Amendments and Waivers. Neither this Amendment nor any provision
hereof shall be amended, modified, waived or discharged orally or by course of
conduct, but only by a written agreement signed by an authorized officer of
Lender. Lender shall not, by any act, delay, omission or otherwise be deemed to
have expressly or impliedly waived any of its rights, powers and/or remedies
unless such waiver shall be in writing and signed by an authorized officer of
Lender. Any such waiver shall be enforceable only to the extent specifically set
forth therein. A waiver by Lender of any right, power and/or remedy on any one
occasion shall not be construed as a bar to or waiver of any such right, power
and/or remedy which Lender would otherwise have on any future occasion, whether
similar in kind or otherwise.
10. Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, Lender and each of the Borrowers have caused
these presents to be duly executed as of the day and year first above written.
LENDER BORROWERS
CONGRESS FINANCIAL CORPORATION ATLANTIC EXPRESS TRANSPORTATION CORP.
AMBOY BUS CO., INC.
By: /s/ Xxxxxxx Xxxx ATLANTIC-CHITTENANGO REAL PROPERTY CORP.
------------------------ ATLANTIC-CONN. TRANSIT, INC.
Title: Vice President ATLANTIC EXPRESS COACHWAYS, INC.
ATLANTIC-XXXXXX, INC.
Address: ATLANTIC MEDFORD INC.
1133 Avenue of the Americas ATLANTIC PARATRANS, INC.
Xxx Xxxx, Xxx Xxxx 00000 ATLANTIC PARATRANS OF KENTUCKY, INC.
BLOCK 7932, INC.
ATLANTIC EXPRESS OF MISSOURI INC.
ATLANTIC EXPRESS OF PENNSYLVANIA, INC.
BROOKFIELD TRANSIT, INC.
COURTESY BUS CO., INC.
GVD LEASING, INC.
180 JAMAICA CORP.
X. XXXX, INC.
JERSEY BUSINESS LAND CO., INC.
MERIT TRANSPORTATION, CORP.
METRO AFFILIATES, INC.
METROPOLITAN ESCORT SERVICE, INC.
MIDWAY LEASING, INC.
XXXXXXX BUS SERVICE, INC.
XXXXXXX CAPITAL CORP.
XXXXXXX EQUITY CORP.
STATEN ISLAND BUS, INC.
ATLANTIC EXPRESS OF L.A., INC.
CENTRAL NEW YORK COACH SALES AND
SERVICE, INC.
JERSEY BUS SALES, INC.
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ATLANTIC PARATRANS OF COLORADO, INC.
ATLANTIC PARATRANS OF PENNSYLVANIA, INC.
ATLANTIC EXPRESS OF NEW JERSEY, INC.
ATLANTIC PARATRANS OF ARIZONA, INC.
TEMPORARY TRANSIT SERVICE, INC.
201 WEST XXXXXXX REALTY, INC.
ATLANTIC TRANSIT, CORP.
AIRPORT SERVICES, INC.
ATLANTIC EXPRESS NEW ENGLAND, INC.
ATLANTIC EXPRESS OF CALIFORNIA, INC.
ATLANTIC EXPRESS OF ILLINOIS, INC.
ATLANTIC EXPRESS OF SOUTH CAROLINA, INC.
XXXXX BUS SERVICE, INC.
GROOM TRANSPORTATION, INC.
XXXXX XXXXXXX LIMO SERVICE, INC.
XXXXXXXX TRANSPORTATION, INC.
MOUNTAIN TRANSIT, INC.
X. XXXXX BUS SERVICE, INC.
XXXXXX X. XXXXXXXX & SON, INC.
T-NT BUS SERVICE, INC.
TRANSCOMM, INC.
WINSALE, INC.
WRIGHTHOLM BUS LINE, INC.
By: /s/ Xxxxxx Xxxxxxxxx
--------------------------------
Title: Chief Financial Officer of
each of the Companies Listed
above
Chief Executive Xxxxxx
0 Xxxxx Xxxxxx
Xxxxxx Xxxxxx, Xxx Xxxx 00000
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