JOINDER AND CONSOLIDATED AMENDMENT
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Exhibit
10.2
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JOINDER
AND CONSOLIDATED AMENDMENT
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TO
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THIS JOINDER AND CONSOLIDATED AMENDMENT TO LOAN AND SECURITY
AGREEMENT
(this
"Amendment"),
dated
as of the 15th day of May, 2006, made by and among
BANK
OF AMERICA, N.A.,
a
national banking association (the "Lender");
CHAUTAUQUA
AIRLINES, INC.,
an
Indiana corporation (the "Existing
Borrower");
and
REPUBLIC
AIRWAYS HOLDINGS INC.,
a
Delaware corporation (the "Parent"),
REPUBLIC
AIRLINE INC., an
Indiana corporation ("Republic
Airline"),
and
SHUTTLE
AMERICA CORPORATION,
an
Indiana corporation ("Shuttle
America"
and,
together with the Parent and Republic Airline, each a "Joining
Borrower"
and,
collectively, the "Joining
Borrowers";
and,
individually and collectively with the Existing Borrower, the "Borrower"
or the
"Borrowers"),
to
the
Loan and Security Agreement, dated December 9, 1998 (as amended, modified,
restated or supplemented from time to time, the "Loan
Agreement"),
between the Existing Borrower and the Lender. All capitalized terms used herein
without definition shall have the meanings ascribed to such terms in the Loan
Agreement.
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RECITALS
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A. Pursuant
to the Loan Agreement, the Lender has agreed to make loans and extend credit
to
the Existing Borrower secured by all of the Collateral.
B. The
Loan
Agreement has been previously amended by Consolidated Amendment No. 1 thereto,
dated March 27, 2002, by Amendment No. 2 thereto, dated October 9, 2003, by
Amendment No. 3 thereto, dated October 30, 2003, by Amendment No. 4 thereto,
dated January 9, 2004, by Amendment No. 6 [there being no Amendment No. 5 to
the
Loan Agreement] thereto, dated March 24, 2005, by Amendment No. 7 thereto,
dated
July 8, 2005, by Amendment No. 8 thereto, dated November 2, 2005, by Amendment
No. 9 thereto, dated January 12, 2006, and by Amendment No. 10 thereto dated
March 22, 2006 (the Consolidated Amendment No.1, and Amendments ▇▇. ▇, ▇, ▇,
▇,
▇, ▇, ▇ and 10 to the Loan Agreement being herein called the "Prior
Amendments").
C. The
Existing Borrower, Republic Airline and Shuttle America are all Subsidiaries
of
the Parent. In recognition of their business relationship with the Existing
Borrower, the Joining Borrowers have requested that they be permitted to join
in
the Loan Agreement, as amended herein, and in all Loan Documents, each as a
co-Borrower, and be permitted to borrow from the Lender pursuant to the terms
thereof, and the Lender and the Existing Borrower have consented thereto,
subject to the terms and conditions hereof.
D. The
business of the Borrowers is a mutual and collective enterprise and each
Borrower believes that the consolidation of all loans and other financial
accommodations under the Loan Agreement will enhance the aggregate borrowing
powers of each Borrower and ease the administration of their loan relationship
with the Lender, all to the mutual advantage of each Borrower. In order to
utilize the financial powers of each Borrower in the most efficient and
economical manner, and in order to facilitate the financing of each Borrower's
needs, the Lender will, at the request of the Borrower, extend financial
accommodations to all Borrowers on a combined basis in accordance with the
provisions set forth in the Loan Agreement as amended hereby. The Lender's
willingness to extend credit to the Borrowers and to administer each Borrower's
collateral security therefor on a combined basis as more fully set forth in
the
Loan Agreement as amended hereby is done solely as an accommodation to the
Borrowers and at each Borrowers' request and in furtherance of the mutual and
collective enterprise of all Borrowers.
E. The
parties have also agreed to further modify and amend certain provisions of
the
Loan Agreement as set forth herein.
F. The
amendments heretofore made by the Prior Amendments and desired to be made
pursuant to the terms hereof are so numerous that it is advisable, for the
sake
of convenience, to restate and consolidate in this Amendment all of the
currently effective amendments to the Loan Agreement.
G. To
accomplish the foregoing, the Existing Borrower, the Joining Borrowers and
the
Lender have agreed to enter into this Amendment.
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STATEMENT
OF
AGREEMENT
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NOW,
THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby expressly
acknowledged, the Existing Borrower, the Joining Borrowers and the Lender hereby
agree as follows:
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ARTICLE
I
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JOINDER
AND ASSUMPTION OF OBLIGATIONS; JOINT AND SEVERAL LIABILTY; WAIVERS BY BORROWERS;
GRANT OF COLLATERAL
1.1. Joinder
and Assumption of Obligations.
Each
Joining Borrower joins in, assumes, adopts and becomes a co-Borrower under
the
Loan Agreement and all other Loan Documents. All references to "Borrower" in
the
Loan Agreement and the other Loan Documents shall, for all purposes, also refer
to and include each of the Joining Borrowers, as a Borrower. Each Joining
Borrower hereby agrees to all of the terms and conditions of the Loan Agreement
and the other Loan Documents (including, without limitation, the grant and
creation of a Lien in the Joining Borrower Collateral of such Joining Borrower
to the Lender), with the same legal effect as if such Joining Borrower were
an
original signatory to the Loan Agreement and the other Loan
Documents.
1.2. Joint
and Several Liability.
Without
limiting the generality of Section 1.1 hereof:
(a)
the
Existing Borrower and the Joining Borrowers shall each be directly liable to
the
Lender, jointly and severally, for all present and future Obligations, whether
incurred by the Existing Borrower or the Joining Borrowers or any or all of
them. Each Borrower shall make payment upon the maturity of the Obligations,
by
acceleration or otherwise, and such obligation and liability on the part of
each
Borrower shall in no way be affected by any extensions, renewals and forbearance
granted by the Lender to any Borrower, failure of the Lender to give any
Borrower any notice of borrowing or any other notice, any failure of the Lender
to pursue or preserve its rights against any Borrower, the release by the Lender
of any Collateral now or hereafter acquired from any Borrower, and such
agreement by each Borrower to pay upon any notice issued pursuant thereto is
unconditional and unaffected by prior recourse by the Lender to the other
Borrower or any Collateral for such Borrower's Obligations or the lack
thereof;
(b) each
Joining Borrower agrees to perform, comply with and be bound by all terms,
conditions and covenants of the Loan Agreement and the other Loan Documents
with
the same force and effect as if such Joining Borrower had originally executed
and been an original Borrower party signatory thereto;
(c) each
Joining Borrower is deemed to make, and is, in all respects, bound by all
representations and warranties made by the Existing Borrower to the Lender
set
forth in the Loan Agreement or in any of the other Loan Documents;
and
(d) each
Joining Borrower agrees that the Lender shall have all rights, remedies and
interests, including Liens in and to the Joining Borrower Collateral of such
Joining Borrower granted pursuant to the Loan Agreement and the other Loan
Documents, as amended hereby, and by Section 1.3 of this Amendment, with the
same force and effect as the Lender has with respect to the Collateral of the
Existing Borrower, as if such Joining Borrower had originally executed and
had
been an original Borrower party signatory to the Loan Agreement and the other
Loan Documents.
1.3. Grant
of Lien in Joining Borrower Collateral.
Without
limiting the generality of the provisions of Sections 1.1 or 1.2 hereof, to
secure the prompt payment and performance of the Obligations (as such term
is
defined in the Loan Agreement as amended hereby), each Joining Borrower hereby
grants to the Lender a continuing Lien upon all of the following Property and
interests in Property of such Joining Borrower, whether now owned or existing
or
hereafter created, acquired or arising and wheresoever located, all of which
shall be included in the definition of Collateral as set forth in the Loan
Agreement:
| (i) All Accounts; |
| (ii) All Inventory; |
| (iii) All Equipment; |
| (iv) All General Intangibles; |
| (v) All Documents; |
| (vi) All Instruments; |
| (vii) All Chattel Paper; |
| (viii) All Deposit Accounts; |
| (ix) All Securities (except any portion thereof that might constitute Margin Stock); |
| (x) All Investment Property; |
| (xi) All tickets, exchange orders and other billing documents for the air transportation of passengers and property, whether processed or unprocessed; |
| (xii) All monies and other Property of any kind now or at any time or times hereafter in the possession or under the control of Lender or a bailee or Affiliate of Lender; |
| (xiii) All accessions to, substitutions for and all replacements, products and cash and non-cash proceeds of (i) through (xii) above, including, without limitation, proceeds of and unearned premiums with respect to insurance policies insuring any of such Joining Borrower's Joining Borrower Collateral; and |
| (xiv) All books and records (including, without limitation, customer lists, credit files, computer programs, print-outs, and other computer materials and records) of such Joining Borrower pertaining to any of (i) through (xiii) above. |
1.4. Exclusion
From Collateral.
The
Collateral of the Joining Borrowers in which the Lender is granted a Lien
pursuant to Section 1.3 of this Amendment shall not include any licenses,
permits, contracts or other agreements to the extent that the grant of a Lien
therein or assignment thereof is prohibited under, or would result in a breach
of the terms of, any such license, permit, contract or other agreement, or
is
prohibited by Applicable Law; provided,
however,
the
foregoing exclusion shall in no way be construed (i) to apply if any such
prohibition is unenforceable under Section 9-318 of the Uniform Commercial
Code
or other Applicable Law or (ii) so as to limit, impair or otherwise affect
the
Lender's unconditional continuing Liens in any rights or interests of a Joining
Borrower in or to monies due or to become due under any such license, permit,
contract or other agreement (including any Accounts).
1.5 Amount
of Obligations Currently Outstanding.
The
Existing Borrower and the Joining Borrowers each hereby jointly and severally
acknowledges and agrees with the Lender that, as of the opening of business
on
May 15, 2006, the aggregate principal balance of the outstanding Obligations
under the Loan Agreement is in the sum of $12,538,363.76, consisting of an
unpaid principal balance of Revolving Loans in the sum of $-0-, an unpaid
principal balance of the Term Loan in the sum of $-0-, an unpaid principal
balance of Equipment Loans in the sum of $2,355,877.28, and Letter of Credit
Obligations in the sum of $10,182,486.48, and that all such Loans and Letter
of
Credit Obligations outstanding and unpaid are owed to the Lender without any
offset, deduction, defense or counterclaim of any nature.
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ARTICLE
II
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AMENDMENTS
TO LOAN AGREEMENT
The
Loan
Agreement is hereby amended as follows:
2.1. Definitions.
Appendix
A to the Loan Agreement is amended as follows:
(a) New
definitions are added in proper alphabetical sequence as follows:
"Average
Monthly Revolver Facility Amount"-
for
any month, the amount obtained by adding the Revolver Facility Amount at the
end
of each day during the month in question and by dividing that sum by the number
of days in such month.
"Average
Monthly Revolver Facility Balance"-
for
any month, the amount obtained by adding the aggregate unpaid balance of all
Revolver Loans and Letter of Credit Obligations owing by Borrower to Lender
at
the end of each day during the month in question and by dividing that sum by
the
number of days in such month.
"Consolidated
Book Net Worth"
- at
any date the shareholders' equity of Borrower and its Subsidiaries at such
date
calculated in accordance with GAAP.
"Eligible
Spare Parts"
- a
Spare Part of Borrower which Lender, in its good faith credit judgment, based
upon its usual and customary credit and collateral considerations, deems to
be
an Eligible Spare Part. Without limiting the generality of the foregoing, no
Spare Part shall be an Eligible Spare Part unless:
(i)
it is in
airworthy condition in accordance with all Applicable Laws, including all
applicable FAA rules and regulations;
(ii)
it meets
all standards imposed by any applicable governmental agency or
authority;
(iii)
it
conforms in all respects to the warranties and representations set forth in
the
Agreement;
(iv)
it is
subject to Lender's duly perfected Lien and no other Lien except a Permitted
Lien that is not a Purchase Money Lien;
(v) it
is
situated at a location in compliance with the Agreement; and
(vi)
it is
owned outright by Borrower and not held by Borrower on consignment or other
sale
or return basis.
"ERJ"
- an
Embraer regional jet aircraft.
"ERJ
Spare Part"
- a
Spare Part for an ERJ.
"ERJ
Start-Up Expenses"
-
start-up expenses incurred by Borrower for the operation of the ERJ
Aircraft.
"Existing
Borrower"
-
Chautauqua Airlines, Inc., an Indiana corporation.
"Joining
Borrowers"
-
Republic Airlines Holdings Inc., a Delaware corporation, and Republic Airline
Inc. and Shuttle America Corporation, each an Indiana corporation.
"Joining
Borrower Collateral"
- all
of the Property and interests in Property of each Joining Borrower described
in
Section 1.3 of the Consolidated Amendment to the Agreement or in Section 6
of
the Agreement, and all other Property and interests in Property of each Joining
Borrower that now or hereafter secure the payment and performance of any of
the
Obligations.
"Non-Financed
Capital Expenditures"
- in
the case of a Capital Expenditure made or incurred for the acquisition of a
Rotable, a Capital Expenditure which is not financed by Purchase Money
Indebtedness or, if such Rotable is a ERJ Spare Part, a Revolver Loan made
in
respect of the ERJ Spare Parts Borrowing Base, and, in the case of all other
Capital Expenditures, a Capital Expenditure which is not financed by Purchase
Money Indebtedness, the Term Loan or an Equipment Loan.
"Spare
Parts Advance Rate"
- shall
mean, for each classification of Eligible Spare Parts at any date of
determination thereof, the percentage set forth below corresponding to such
classification and date:
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Date
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Spare
Parts Advance Rate For Those Eligible Spare Parts Consisting Of ERJ
Spare
Parts Which Are Rotables
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Spare
Parts Advance Rate For Those Eligible Spare Parts Consisting Of ERJ
Spare
Parts Which Are Not Rotables
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Through
but not including June 30, 2006
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70%
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40%
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June
30, 2006 through but not including September 30, 2006
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65%
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35%
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September
30, 2006 through but not including December 31, 2006
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60%
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30%
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December
31, 2006 and at all times thereafter
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50%
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20%
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"Spare
Parts Borrowing Base
- at any
date of determination thereof, the sum of the following:
(i) the
aggregate value at such date of those Eligible Spare Parts consisting of ERJ
Spare Parts which are Rotables times the Spare Parts Advance Rate applicable
thereto at such date; plus
(ii) the
aggregate value at such date of those Eligible Spare Parts consisting of ERJ
Spare Parts which are not Rotables times the Spare Parts Advance Rate applicable
thereto at such date,
in
each
case with value calculated on the basis of the lower of (1) net book value,
as
calculated in accordance with GAAP, or (2) appraised orderly liquidation value
based upon the Lender's most recent Spare Parts Collateral
Appraisal."
(b) The
definition of "Availability Reserve" is amended in its entirety to read as
follows:
"Availability
Reserve
- on any
date of determination thereof, an amount equal to the sum of (i) all amounts
of
past due rent or other charges owing at such time by Borrower or any of its
Subsidiaries to any landlord of any premises where any material items of the
Collateral is located; (ii) any amounts which Borrower or any of its
Subsidiaries is obligated to pay pursuant to the provisions of the Loan
Documents but does not pay when due and which Lender elects to pay pursuant
to
any of the Loan Documents for the account of Borrower and its Subsidiaries
and
which has not been reimbursed to Lender (whether by the proceeds of a Revolver
Loan or otherwise); (iii) an amount equal to the Letter of Credit Obligations
outstanding on such date; (iv) the maximum authorized credit card charge limit
extended to Borrower by Lender or any of its Affiliates; and (v) such additional
reserves established in good faith by Lender in such amounts, and with respect
to such matters, events, conditions or contingencies as to which Lender, in
its
good faith credit judgment, based upon its usual and customary credit and
collateral considerations, determines reserves should be established from time
to time, including, without limitation, with respect to or as a result of (1)
improper ▇▇▇▇▇▇▇▇, other billing and settlement errors which occur from time
to
time under the ACH Procedures Manual, (2) negative trends in the maintenance
by
Borrower of minimum operations in the markets established under the USAir
Operating Agreement, or a flight completion factor or arrival performance
factor, that if uncorrected may, in Lender's good faith judgment, give rise
to a
right of termination of the USAir Operating Agreement by USAir in accordance
with the provisions thereof, or (3) other sums chargeable against Borrower's
Loan Account as Revolver Loans under any section of the Agreement."
(c) The
definition of "Borrower" set forth in the Loan Agreement is amended to include,
in addition and not in limitation, each of the Joining Borrowers within such
definition.
(d) The
definition of "Borrowing Base" is amended in its entirety to read as
follows:
"Borrowing
Base"
- as at
any date of determination thereof, an amount equal to the sum of:
(i) the
Accounts Borrowing Base at such date;
PLUS
(ii) the
Spare
Parts Borrowing Base at such date;
MINUS
(iii) the
Availability Reserve at such date."
(e) The
definition of "Change of Control" is deleted in its entirety.
(f) The
definition of "Consolidated EBITDAR" is amended in its entirety to read as
follows:
"Consolidated
EBITDAR
- with
respect to any fiscal period, the sum of (i) Consolidated EBITDA for such fiscal
period, plus
(ii)
rentals for aircraft leased by Borrower or any of its Subsidiaries for such
fiscal period which were subtracted from earnings in calculating Consolidated
Adjusted Net Earnings From Operations for Borrower and its Subsidiaries for
such
fiscal period."
(g) The
definition of "Consolidated Fixed Charges " is amended in its entirety to read
as follows:
"Consolidated
Fixed Charges
- with
respect to any period, the sum of (i) interest expense of Borrower and its
Subsidiaries for such period in respect of all Indebtedness for Money Borrowed,
plus
(ii) tax
expense of Borrower and its Subsidiaries paid in cash for such period,
plus
(iii)
regularly scheduled payments of principal on Indebtedness for Money Borrowed
required to be paid by Borrower and its Subsidiaries during such period,
plus
(iv)
rentals for aircraft leased by Borrower or any of its Subsidiaries paid or
required to be paid by Borrower and its Subsidiaries during such period (except
for the above market component of such rentals which are capitalized in
accordance with GAAP), plus
(v)
Distributions paid by Borrower during such period, plus
(vi)
Non-Financed Capital Expenditures paid by Borrower during such period,
minus
(vii)
any cash contributions to Borrower's capital received by Borrower during such
period, minus
(viii)
the proceeds of Subordinated Debt incurred by Borrower which are received in
cash by Borrower during such period."
(h) The
definition of "Consolidated Leverage Ratio" is amended in its entirety to read
as follows:
"Consolidated
Leverage Ratio
- at any
date means the ratio of (i) Indebtedness for Money Borrowed of Borrower and
its
Subsidiaries at such date to (ii) Consolidated Book Net Worth of Borrower and
its Subsidiaries at such date."
(i) The
definition of "Eligible Equipment" is amended in its entirety to read as
follows:
"Eligible
Equipment
- New
Equipment consisting of Rated Engines for use in a ERJ which (i) have been
purchased by Borrower after ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) have been delivered to and
accepted by Borrower and (iii) are subject to Lender's duly perfected first
priority Lien and no other Lien that is not a Permitted Lien."
(j) The
definition of "Indebtedness for Money Borrowed/Consolidated EBITDA Ratio" is
amended in its entirety to read as follows:
"Indebtedness
for Money Borrowed/Consolidated EBITDA Ratio
- on the
determination thereof as of the end of any fiscal period, the ratio of (i)
the
aggregate principal balance of all Indebtedness for Money Borrowed of Borrower
and its Subsidiaries outstanding as of the end of such fiscal period to (ii)
Consolidated EBITDA of Existing Borrower and its Subsidiaries for the four
(4)
Fiscal Quarters then ending."
(k) The
definition of "Obligations" is amended in its entirety to read as
follows:
"Obligations
-
collectively, (i) the Loans and all other sums loaned or advanced by Lender
to
or on behalf of Borrower pursuant to the Agreement or the other Loan Documents,
(ii) all liabilities, indebtedness and obligations now or any time hereafter
owing by Borrower or any Subsidiary of Borrower to Lender or an Affiliate of
Lender, whether under the Agreement or any of the other Loan Documents or
otherwise, (iii) Hedging Obligations owing by Borrower or any Subsidiary of
Borrower to Lender or an Affiliate of Lender (unless Lender or such Affiliate
otherwise agrees in writing), and (iv) all other liabilities, indebtedness
and
obligations of any and every kind now or hereafter owing, arising, due or
payable from Borrower or any Subsidiary of Borrower to Lender of any kind or
nature, present or future, whether or not evidenced by any note, guaranty or
other instrument, whether arising under this Agreement or any of the other
Loan
Documents or otherwise, whether direct or indirect (including those acquired
by
assignment), absolute or contingent, primary or secondary, due or to become
due,
now existing or hereafter arising and however acquired."
(l) The
definition of "Revolver Facility Amount" is amended in its entirety to read
as
follows:
"Revolver
Facility Amount
- At any
date of determination thereof, the sum of $25,000,000, as such amount may be
reduced by Borrower pursuant to Section 1.4 of the Agreement, less the aggregate
principal balances of the Term Loan and all Equipment Loans outstanding on
such
date."
(m) The
definition of "Rotables/Rated Engines Borrowing Base" is deleted in its
entirety.
2.2. Letters
of Credit.
Section
1.2.1 is amended in its entirety to read as follows:
"1.2.1 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 10 below, to issue Letters of Credit and Letter of Credit
Guaranties, as requested by Borrower, provided that (a) the Letter of Credit
Amount at any time shall not exceed $13,000,000 and (b) without Lender's consent
in each instance, no Letter of Credit or Letter of Credit Guaranty may have
an
expiration date that is after the last day of the Original Term. Any amounts
paid by Lender under any Letter of Credit Guaranty or in connection with any
Letter of Credit shall be treated as Revolver Loans, shall be secured by all
of
the Collateral and shall bear interest and be payable at the same rate and
in
the same manner as the Revolver Loans."
2.3. Reduction
of Revolver Facility Amount.
Section
1.4 is amended in its entirety to read as follows:
"1.4 Reduction
of Revolver Facility Amount.
Borrower shall have the right to reduce the Revolver Facility Amount, no more
than three (3) separate times and upon not less than ten (10) days prior written
notice to Lender of each such reduction, which notice shall specify the
effective date thereof and the amount of any such reduction (which shall be
in a
minimum amount of $500,000 or a whole multiple of $100,000 in excess thereof)
and shall be irrevocable and effective only upon receipt by Lender. In no event,
however, shall Borrower have the right to reduce the Revolver Facility Amount
below $11,000,000. If on the effective date of any such reduction in the
Revolver Facility Amount and after giving effect thereto, an Overadvance
Condition shall exist, then the provisions of Section 4.2.1(iii) shall apply.
The Revolver Facility Amount once reduced pursuant to this Section 1.4 may
not
be reinstated."
2.4. Joint
and Several Liability; Appointment of Existing Borrower.
A new
Section 1.5, Joint
and Several Liability; Appointment of Existing Borrower,
is
added at the end of Section 1, Credit Facility, as follows:
"1.5 Joint
and Several Liability; Appointment of Existing Borrower.
Notwithstanding anything to the contrary contained herein, Borrowers shall
be
jointly and severally liable to Lender for all Obligations hereunder, regardless
of whether such Obligations arise as a result of Loans, Letters of Credit or
other credit extensions to one Borrower, it being stipulated and agreed that
Loans, Letters of Credit and credit extensions hereunder to one Borrower inure
to the benefit of all Borrowers, and that Lender is relying on the joint and
several liability of Borrowers in making Loans, issuing Letters of Credit and
extending credit hereunder. To facilitate the administration of the Loans,
each
Borrower hereby irrevocably appoints Existing Borrower as its true and lawful
agent and attorney-in-fact with full power and authority to execute, deliver
and
acknowledge, as appropriate, each notice, each certificate and all other Loan
Documents from time to time deemed necessary or appropriate by Lender in
connection with the Loans and the Letters of Credit and the administration
of
the credit facilities provided to Borrowers hereunder. This power-of-attorney
is
coupled with an interest and cannot be revoked, modified or amended without
the
prior written consent of Lender. Upon request of Lender, each Borrower shall
execute, acknowledge and deliver to Lender a form of power of attorney
confirming and restating the power-of-attorney granted herein."
2.5. Cross-Guaranty;
Subordination.
A new
Section 1.6, Cross-Guaranty;
Waiver of Suretyship Defenses; Subordination,
is
added at the end of Section 1, Credit Facility, as follows:
"1.6 Cross-Guaranty;
Waiver of Suretyship Defenses; Subordination.
1.6.1 Cross-Guaranty.
Each
Borrower guarantees to Lender the payment in full of all of the Obligations
of
the other Borrower and further guarantees the due performance by the other
Borrower of its duties and covenants made in favor of Lender hereunder and
under
the other Loan Documents. Each Borrower agrees that neither this cross-corporate
guaranty nor the joint and several liability of Borrowers provided in Section
1.5 hereof (and in Article I of the Consolidated Amendment to this Agreement)
nor Lender's Lien in any of the Collateral shall be impaired or affected by
any
modification, supplement, extension or amendment of any contract or agreement
to
which the parties hereto may hereafter agree (other than an agreement signed
by
Lender specifically releasing such liability), nor by any modification, release
or other alteration of any of the rights of Lender with respect to any of the
Collateral, nor by any delay, extension of time, renewal, compromise or other
indulgence granted by Lender with respect to any of the Obligations (other
than
an agreement signed by Lender specifically releasing such Collateral), nor
by
any other agreements or arrangements whatever with any other Borrower or with
anyone else, each Borrower hereby waiving all notice of any such delay,
extension, release, substitution, renewal, compromise or other indulgence,
and
hereby consenting to be bound thereby as fully and effectively as if it had
expressly agreed thereto in advance. The liability of each Borrower hereunder
is
direct and unconditional as to all of the Obligations, and may be enforced
without requiring Lender first to resort to any other right, remedy or
security.
1.6.2 Postponement
of Subrogation.
Until
all of the Obligations are paid in full, no Borrower shall have any right of
subrogation, reimbursement or indemnity whatsoever, nor any right of recourse
to
security for any of the Obligations, and nothing shall discharge or satisfy
the
liability of a Borrower hereunder, until the full payment and performance of
all
of the Obligations. Any and all present and future debts and obligations of
each
Borrower to each other Borrower are hereby waived and postponed in favor of
and
subordinated to the full payment and performance of all present and future
Obligations of Borrowers to Lender.
1.6.3 Subordination
of Claims.
Each
Borrower hereby subordinates any claims (other than claims evidenced by notes
which have been assigned and delivered to Lender), including, without
limitation, any other right of payment, subrogation, reimbursement, exoneration,
contribution and indemnity that it may have from or against the other Borrower,
and any successor or assign of the other Borrower, including, without
limitation, any trustee, receiver or debtor-in-possession, or against or with
respect to the other Borrower's property (including, without limitation, any
property which is Collateral for the Obligations), howsoever arising, due or
owing and whether heretofore, now or hereafter existing, to all of the
Obligations of the other Borrower to Lender.
1.6.4 Payment
in Ordinary Course.
Notwithstanding the provisions of Sections 1.6.2 and 1.6.3 above, for so long
as
no Default or an Event of Default shall exist, each Borrower may pay to the
other Borrower Indebtedness validly owed to such other Borrower which arises
in
the ordinary course of such Borrower's business."
2.6. Interest.
Section
2.2.1 is amended in its entirety, retroactively to become effective as of
January 1, 2006, to read as follows:
"2.2.1 Rates
of Interest - Loans.
Subject
to the provisions of Section 2.1.6 of this Agreement, Borrower agrees to pay
interest on the unpaid principal amount of the Loans outstanding from the
respective dates such principal amounts are advanced until paid (whether at
stated maturity, on acceleration, or otherwise) at a variable rate per annum
equal to the applicable rate indicated below:
(i) For
Loans
made or outstanding as Base Rate Loans, the Base Rate in effect from time to
time, plus,
for the
period from January 1, 2006 to the date of the Consolidated Amendment to this
Agreement, one-half of one percent (0.50%), and, at all times thereafter,
three-quarters of one percent (0.75%);
(ii) For
Loans
made or outstanding as Daily LIBOR Loans, the Daily LIBOR Rate in effect from
time to time, plus,
for the
period from January 1, 2006 to the date of the Consolidated Amendment to this
Agreement, two and three-quarters percent (2.75%), and at all times thereafter,
three percent (3.0%); and
(iii) For
Loans
made or outstanding as LIBOR Rate Loans, the relevant Adjusted LIBOR Rate for
the applicable Interest Period selected by Borrower in conformity with this
Agreement, plus,
for the
period from January 1, 2006 to the date of the Consolidated Amendment to this
Agreement, two and one-half percent (2.5%), and, at all times thereafter, two
and three-quarters percent (2.75%)."
2.7. Additional
Interest.
Section
2.1.8 is amended in its entirety to read as follows:
"2.1.8 Additional
Interest.
At the
end of each calendar quarter (or, if this Agreement is terminated before the
end
of a calendar quarter, on the termination date), the Average Credit Facility
Balance for such calendar quarter (or that portion of such calendar quarter
through the termination date) shall be determined, and if such Average Credit
Facility Balance is less than $7,500,000, then, no later than ten (10) days
after the end of such calendar quarter (or, if this Agreement is earlier
terminated, on the termination date), Borrower shall pay to Lender additional
interest in an amount equal to $35,000."
2.8. Unused
Line Fee.
Section
2.2.2 is amended in its entirety to read as follows:
"2.2.2 Unused
Line Fee.
Borrower shall pay to Lender a fee equal to three-eighths of one percent
(0.375%) per annum of the amount by which the Average Monthly Revolver Facility
Amount for each month during the Original Term exceeds the Average Monthly
Revolver Facility Balance for such month. The unused line fee shall begin to
accrue on the Closing Date and shall be payable monthly in arrears on the first
day of each calendar month after the Closing Date and upon the termination
of
this Agreement.
2.9. Letter
of Credit and Letter of Credit Guaranty Fees.
Section
2.2.3 is amended in its entirety to read as follows:
"2.2.3 Letter
of Credit and Letter of Credit Guaranty Fees.
For
each Letter of Credit and Letter of Credit Guaranty issued from time to time
pursuant to Section 1.2 of this Agreement, Borrower shall pay to Lender: (a)
an
issuance fee, payable in advance upon issuance of the Letter of Credit or Letter
of Credit Guaranty and on each anniversary date hereof, equal to one percent
(1%) per annum of the undrawn face amount thereof, plus $150, but in no event
shall such issuance fee be less than $500; (b) an administrative fee, payable
monthly in arrears on the first day of each calendar month after the Closing
Date and upon the termination of this Agreement, equal to one and three-quarters
percent (1.75%) per annum of the undrawn face amount thereof, and (c) fees
and
charges from time to time with respect to the amendment, transfer,
administration, negotiation, cancellation and conversion of, and drawings under,
each of the Letters of Credit and the Letter of Credit Guaranties in the
respective amounts set forth in Schedule
2.2.3
hereof."
2.10. Audits
and Appraisals.
Section
2.2.4 is amended in its entirety to read as follows:
"2.2.4 Audit
and Appraisal Fees.
Borrower shall reimburse Lender at
the
rate of $850 per person per day, plus out of pocket expenses, for all audit
reviews, field examinations and collateral examinations of Borrower's books
and
records conducted by Lender from time to time, and shall also reimburse Lender
for all reasonable costs and expenses from time to time incurred by Lender
in
connection with any appraisals of the Collateral."
2.11. Facility
Fee.
A new
Section 2.2.5 is added as follows:
"2.2.5 Extension
Fee.
In the
event that, by each date set forth in the table below, Borrower shall not have
(a) terminated this Agreement in accordance with Section 5.2.2 hereof, (b)
paid
all of the Obligations then due to Lender, and (c) either caused each
outstanding Letter of Credit and Letter of Credit Guaranty to be terminated
and
returned to Lender, or paid to Lender funds equal to the undrawn face amount
of
each Letter of Credit and Letter of Credit Guaranty to be held by Lender in
the
Cash Collateral Account pursuant to Section 11.3.7 hereof, then on such date
Borrower shall pay an extension fee to Lender in the amount set forth opposite
such date:
|
Date
|
Extension
Fee
|
|
June
30, 2006
|
$5,000
|
|
September
30, 2006
|
$10,000
|
|
December
31, 2006
|
$15,000
|
Each
installment shall be deemed fully earned when due and non-refundable once
paid."
2.12. Payment
of Principal of Revolver Loans.
Section
4.2.1 is amended by deleting Section 4.2.1(i) in its entirety and by
substituting in lieu thereof the following:
"(i) Any
portion of the Revolver Loans consisting of the principal amount of Base Rate
Loans or Daily LIBOR Loans shall be paid by Borrower to Lender, unless converted
to a LIBOR Rate Loan in accordance with this Agreement, immediately upon the
earlier of (a) the receipt by Lender or Borrower of any Net Proceeds of any
of
the Spare Parts, and, for so long as no Event of Default exists, the Eligible
Accounts, and, during the existence of an Event of Default, all Accounts, in
each case to the extent of such Net Proceeds or (b) the termination of this
Agreement by Borrower or Lender pursuant to Section 5 hereof."
2.13. Payment
of Principal of Equipment Loans.
Section
4.2.3 is amended in its entirety to read as follows:
"4.2.3 Payment
of Principal of Equipment Loans.
Borrower shall repay the principal balance of each Equipment Loan in consecutive
monthly installments of principal, commencing on the first day of the month
following the Equipment Loan Borrowing Date for such Equipment Loan and
continuing on the first day of each month thereafter, each in an amount equal
to
the product obtained by multiplying the amount of such Equipment Loan by a
fraction, the numerator of which is one (1) and the denominator of which is
sixty (60), with a final maturity on the first day of the sixtieth (60th) month
following the month in which the Equipment Loan Borrowing Date
occurs."
2.14. Term
of Loan Agreement.
Section
5.2 is amended in its entirety to read as follows:
"5.1 Term
of Agreement.
Subject
to Lender's right to cease making Loans to Borrower during the existence of
any
Default or Event of Default, this Agreement shall be in effect for a period
from
the date of this Agreement until May 31, 2007 (the "Original Term"), unless
terminated as provided in Section 5.2 hereof."
2.15. Termination
Charges.
Section
5.2.3 is deleted in its entirety
and in
lieu thereof is substituted the phrase "RESERVED".
2.16. Release
of Collateral.
A new
Section 6.5 is added as follows:
"6.5 Release
of Collateral.
In
order to facilitate Borrower's acquisition and financing of Aircraft
manufactured by Embraer-Empresa
Brasileira de Aeronáutica S.A., Lender agrees to execute and deliver, upon
Borrower's request and at Borrower's expense, an Aircraft and Related Property
Lien Release with respect to any such Aircraft substantially in the form of
the
Aircraft and Related Property Lien Release executed by Lender on January 17,
2002 in favor of Borrower and JPMorgan Chase Bank, as Security Trustee, with
respect to the four (4) Embraer EMB-145LR aircraft with manufacturer's serial
numbers 145409 (N282SK), 145424 (N283SK), 145427 (N284SK), and 145435 (N285SK),
provided that no Default or Event of Default then exists or would result
therefrom."
2.17. Administration
of Spare Parts.
Section
7.3 is amended in its entirety to read as follows:
"7.3 Administration
of Spare Parts and other Equipment.
7.3.1 Records
and Schedules of Spare Parts and Other Equipment.
Borrower shall keep accurate records itemizing and describing the kind, type,
quantity and book value of its Spare Parts, and material items of other
Equipment and all dispositions made in accordance with Section 9.2.8 hereof,
and
shall furnish Lender with a current schedule containing the foregoing
information (i) in the case of Spare Parts, monthly no later than the tenth
(10th) day of the month as of the end of the preceding month, and (ii) in the
case of all other Equipment, on at least an annual basis and more often if
reasonably requested by Lender. Borrower shall also keep accurate and complete
logs, manuals, books and records relating to the Equipment, and provide Lender
with copies of reports and information relating to the Equipment as Lender
may
reasonably require from time to time. Promptly after request therefor by Lender,
Borrower shall deliver to Lender copies of any and all evidence of ownership,
if
any, of any Equipment having a cost in excess of $50,000.
7.3.2 Condition
of Spare Parts and Other Equipment.
Borrower shall maintain its Spare Parts and each other material item of its
Equipment in good operating condition and repair, and make all necessary
replacements of and repairs thereto so that the value and operating efficiency
of the Spare Parts and other material items of its Equipment shall be maintained
and preserved, reasonable wear and tear excepted. Borrower shall maintain all
Eligible Equipment for which Lender has made an Equipment Loan and all Aircraft
Collateral and Rated Engine Collateral airworthy at all times, except when
such
items of Collateral are being repaired or replaced in accordance with the
provisions of this Agreement. Borrower will not permit any material item of
its
Equipment to become affixed to any real Property leased to Borrower so that
an
interest arises therein under the real estate laws of the applicable
jurisdiction unless the landlord of such real Property has executed a landlord
waiver or leasehold mortgage in favor of and in form reasonably acceptable
to
Lender.
7.3.3 Supplement.
Borrower shall comply with each Supplement that is hereafter executed by
Borrower pursuant to this Agreement."
2.18. Negative
Covenant on Loans.
Section
9.2.2 is amended in its entirety to read as follows:
"9.2.2 Loans.
Make,
or permit any Subsidiary of Borrower to make, any loans or other advances of
money, except for the following:
(i) advances
for travel, relocation and moving, advances against commissions and other
similar advances to employees in the ordinary course of business;
(ii) loans
or
advances to employees to finance the acquisition of stock of
Borrower;
(iii) loans
or
advances consisting of the extension of trade credit by Borrower and its
Subsidiaries in the ordinary course of business;
(iv) without
duplication, loans and advances permitted as Investments pursuant to Section
9.2.9 of this Agreement;
(v) without
duplication, guaranties otherwise permitted pursuant to Section 9.2.11
hereof;
(vi) subject
to clause (iv) of the definition of Permitted Acquisition, loans or advances
from Borrower to a Subsidiary, from a Subsidiary to Borrower, or from a
Subsidiary to another Subsidiary, provided in each case any instrument
evidencing such loan or advance is endorsed to the order of, delivered to,
and
pledged and assigned to Lender as additional security for the Obligations;
(vii) loans
or
advances from one Borrower to another Borrower; and
(viii) other
loans and advances not to exceed $250,000 in the aggregate at any one time
outstanding."
2.19 Disposition
of Collateral.
Section
9.2.8(iii) is amended in its entirety to read as follows:
"
(iii)
dispositions
in the ordinary course of business of Spare Parts and other items of Equipment
(other than any item of Eligible Equipment financed by an Equipment Loan) of
Borrower and its Subsidiaries; provided that
in the
case of Spare Parts, the Spare Parts Borrowing Base is adjusted
accordingly;"
2.20. Financial
Covenants.
Section
9.3 is amended in its entirety to read as follows:
"9.3 Specific
Financial Covenants.
During
the term of this Agreement, Existing Borrower covenants that, unless otherwise
consented to by Lender in writing, it shall comply with the following financial
covenants:
"9.3.1 Consolidated
Fixed Charge Coverage Ratio.
Borrower and its Subsidiaries shall maintain a Consolidated Fixed Charge
Coverage Ratio for each Testing Period of not less than 1.05 to
1.0.
9.3.2 Indebtedness
for Money Borrowed/Consolidated EBITDA Ratio.
Borrower and its Subsidiaries shall maintain a Indebtedness for Money
Borrowed/Consolidated EBITDA Ratio for each Testing Period of not more than
6.30."
2.21. Amount
of Each Equipment Loans.
Section
10.2.4 is amended in its entirety to read as follows:
"10.2.4
Amount
of Equipment Loan.
The
amount of the requested Equipment Loan shall not exceed ninety percent (90%)
of
the Equipment Purchase Price of the Eligible Equipment being financed with
the
proceeds of such Equipment Loan."
2.22. Events
of Default.
Section
11.1.9 of the Loan Agreement, Change
of Control,
is
deleted in its entirety and in lieu thereof is substituted the phrase
"RESERVED".
2.23. Notices.
Section
12.9 is amended to provide that notices, requests and demands sent to the
Borrower and the Lender shall be addressed as follows:
|
If
to Lender:
|
Bank of America, N.A. |
| ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇ | |
| ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ | |
| Attention: Southeast Loan Administration | |
| Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇ |
|
If
to Borrower:
|
Chatauqua Airlines, Inc. |
| ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇ | |
| ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ | |
| Attention: President | |
| Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇ |
2.24. Equipment
Note.
Exhibit
A-2 attached to the Loan Agreement is deleted and in lieu thereof is substituted
Exhibit A-2 attached to this Amendment.
2.25. Compliance
Certificate.
Exhibit
D attached to the Loan Agreement is deleted and in lieu thereof is substituted
Exhibit D attached to this Amendment.
2.26. Schedule
7.1.1; Location of Spare Parts.
Schedule 7.1.1 is amended to reflect that the Spare Parts of each Borrower
are
located at the locations set forth in Schedule 7.1.1 attached to this
Amendment.
2.27. Renewal
Terms.
All
references in the Loan Agreement to a Renewal Term are deleted.
2.28. Prior
Amendments.
Each of
the amendments made to the Loan Agreement by the Prior Amendments are deleted
in
their entirety.
2.29. References
to Borrower.
All
references in the Loan Agreement or any of the other Loan Documents to
"Borrower" shall be deemed amended to read "any or all of Borrowers", "any
of
Borrowers", "all Borrowers", "each Borrower", "any such Borrower", "each such
Borrower", or other similar phrase as and where applicable, so that each Joining
Borrower is included therein, together with the Existing Borrower and the other
Joining Borrowers.
2.30. References
to Lender.
All
references in the Loan Agreement or any of the other Loan Documents to "Lender"
shall be deemed amended to refer to Bank of America, N.A., a national banking
association, and its successors and assigns.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
The
Existing Borrower and the Joining Borrowers hereby jointly and severally
represent and warrant to the Lender that as of the date hereof:
3.1. Corporate
Power and Authority.
The
execution and delivery by the Existing Borrower and the Joining Borrowers and
the performance by them of the transactions herein contemplated: (i) are and
will be within their respective powers; (ii) have been authorized by all
necessary corporate action; and (iii) do not and will not (i) require any
consent or approval of the shareholders of the Existing Borrower or any Joining
Borrower or any of its respective Subsidiaries which has not been obtained;
(ii)
contravene the Existing Borrower's or any Joining Borrower's or any of its
respective Subsidiaries' charter, articles or certificate of incorporation
or
by-laws; (iii) violate, or cause the Existing Borrower or any Joining Borrower
or any of its respective Subsidiaries to be in default under, any provision
of
any law, rule, regulation, order, writ, judgment, injunction, decree,
determination or award in effect having applicability to the Existing Borrower
or any Joining Borrower or any of its respective Subsidiaries; (iv) result
in a
breach of or constitute a default under any indenture or loan or credit
agreement or any other agreement, lease or instrument to which the Existing
Borrower or any Joining Borrower or any of its respective Subsidiaries is a
party or by which it or its respective Properties may be bound or affected
that
may reasonably be expected to have a Material Adverse Effect; or (v) result
in,
or require, the creation or imposition of any Lien (other than Permitted Liens)
upon or with respect to any of the Properties now owned or hereafter acquired
by
the Existing Borrower or any Joining Borrower or any of its respective
Subsidi-aries.
3.2. Compliance
with the Loan Agreement and Other Loan Documents.
The
Existing Borrower and the Joining Borrowers are each in compliance with all
of
the terms and provisions set forth in the Loan Agreement as amended hereby
and
in the other Loan Documents to be observed or performed by such Borrower, except
where the failure of such Borrower to comply has been waived in writing by
the
Lender.
3.3. Representations
in Loan Agreement and other Loan Documents.
The
representations and warranties of the Existing Borrower set forth in the Loan
Agreement as amended hereby and the other Loan Documents, as joined in and
also
made by the Joining Borrowers pursuant to this Amendment, are true and correct
in all material respects as of the date hereof except to the extent that such
representations and warranties relate solely to or are specifically expressed
as
of a particular date or period which is past or expired as of the date
hereof.
3.4. No
Event of Default.
No
Default or Event of Default exists.
ARTICLE
IV
MODIFICATION
OF LOAN DOCUMENTS;
RELEASE
OF CLAIMS BY BORROWERS
4.1. Loan
Documents.
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.
4.2. Release
of Claims.
To
induce the Lender to enter into this Amendment, and in consideration thereof,
each Borrower hereby releases, acquits and forever discharges the Lender and
the
Lender's officers, directors, agents, employees, successors and assigns, from
all liabilities, claims, demands, actions or causes of action of any kind (if
any there be), whether absolute or contingent, due or to become due, disputed
or
undisputed, at law or in equity, that the Borrowers or any of them now has
or
ever had against the Lender arising under or in connection with the Loan
Agreement, any of the other Loan Documents or otherwise.
ARTICLE
V
CONDITIONS
PRECEDENT
It
shall
be a condition precedent to the amendments to the Loan Agreement as set forth
in
Article II hereof that each of the following conditions shall have been
satisfied:
5.1. Documentation.
The
Lender shall have received the following documents, each to be in form and
substance reasonably satisfactory to the Lender and its counsel:
(a) This
Amendment duly executed by the Borrowers;
(b) Copies
of
all filing receipts or acknowledgments issued by any governmental authority
(including, without limitation, the FAA) to evidence any filing or recordation
necessary to perfect the Liens of the Lender in the Joining Borrower Collateral
and evidence in a form reasonably acceptable to the Lender that such Liens
constitute valid and perfected first priority security interests and Liens,
subject only to those Permitted Liens which are expressly stated to have
priority over the Liens of the Lender;
(c) Copies
of
the Articles of Incorporation of each Joining Borrower, and all amendments
thereto, certified by the secretary of the state of its
incorporation;
(d) Good
standing certificates for each Joining Borrower issued by the secretary of
the
state of its incorporation;
(e) A
closing
certificate signed by an authorized officer of each Borrower stating that (i)
the representations and warranties of each Borrower set forth in this Amendment
and the Loan Agreement are true and correct in all material respects on and
as
of the date of this Amendment, (ii) each Borrower is on such date in compliance
in all material respects with all the terms and provisions set forth in the
Loan
Agreement, as amended hereby, and the other Loan Documents, and (iii) on such
date no Default or Event of Default exists;
(f) Certificate
of the Secretary or an Assistant Secretary of each Borrower certifying (i)
that
attached thereto is a true and complete copy of the Bylaws of such Borrower,
as
in effect on the date of such certification, (ii) that attached thereto is
a
true and complete copy of the resolutions adopted by the Board of Directors
of
such Borrower authorizing the execution, delivery and performance of this
Amendment, the joinder by the Joining Borrowers in the Loan Agreement and the
other Loan Documents, the guaranty by each Borrower of the Obligations of the
other Borrowers, and the consummation of the transactions contemplated hereby
and thereby, and (iii) as to the incumbency and genuineness of the signature
of
each officer of each Borrower executing this Amendment or any of the Loan
Documents;
(g) A
Spare
Parts Supplement (or, in the case of the Existing Borrower, an amendment
thereto), duly executed by each Borrower (other than the Parent) for the
locations at which any Spare Parts are located as set forth in Schedule 7.1.1
to
the Loan Agreement;
(h) Favorable
written opinions from special FAA counsel to the Lender as to the recordation
of
the Spare Parts Supplements executed by each Borrower (other than the Parent)
pursuant to this Amendment in form and substance satisfactory to the Lender
and
its counsel;
(i) Certified
copies of casualty insurance policies of each Borrower, together with loss
payable endorsements on the Lender's standard form of Loss Payee Endorsement
naming the Lender as loss payee as its interests may appear; and
(j) Such
other documents, instruments and agreements as the Lender shall reasonably
request in connection with the foregoing matters.
5.2.
Representations
and Warranties.
Each of
the warranties and representations of the Borrowers set forth in this Amendment,
the Loan Agreement as amended hereby, and the other Loan Documents shall be
true, correct and accurate in all material respects.
ARTICLE
VI
GENERAL
6.1. 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.
6.2 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.
6.3 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.
6.4 Expenses.
The
Borrower shall reimburse the Lender for all reasonable legal fees and expenses
incurred by the Lender in connection with the preparation, negotiation,
execution and delivery of this Amendment and all other agreements and documents
or contemplated hereby.
6.5. Headings.
The
headings in this Amendment are for the purpose of reference only and shall
not
affect the construction of this Amendment.
6.6 Waiver
of Jury Trial.
TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE EXISTING BORROWER, THE JOINING
BORROWERS 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.
[Signatures
Begin on the Next Page]
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered on the date first above written.
| Existing Borrower: | ||
| CHAUTAUQUA AIRLINES INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| Joining Borrowers: | ||
| REPUBLIC AIRWAYS HOLDINGS INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| REPUBLIC AIRLINE INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| SHUTTLE AMERICA CORPORATION | ||
| |
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| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| Lender: | ||
| BANK OF AMERICA, N.A. (successor by assignment to Fleet Capital Corporation) | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
|
|
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| Title: Senior Vice President | ||
EXHIBIT
A-2
SECURED
PROMISSORY NOTE
| $[Amount of Equipment Loan] | [Equipment Loan Borrowing Date] |
| Charlotte, North Carolina |
FOR
VALUE
RECEIVED,
the
undersigned (hereinafter, individually and collectively, "Borrower"), hereby
promises to pay to the order of
BANK OF AMERICA, N.A.,
a
national banking association (hereinafter "Lender"), in such coin or currency
of
the United States which shall be legal tender in payment of all debts and dues,
public and private, at the time of payment, the principal sum of
_______________________________ Dollars ($____________), together with interest
from and after the date hereof on the unpaid principal balance outstanding
at
the rates of interest in effect from time to time pursuant to Section 2.1 of
the
Loan Agreement (as such term is defined below).
This
Secured Promissory Note (the "Note") is one of the Equipment Notes referred
to
in, and is issued pursuant to, that certain Loan and Security Agreement between
Borrower and Lender dated December 9, 1998 (hereinafter, as amended from time
to
time, the "Loan Agreement"), and is entitled to all of the benefits and security
of the Loan Agreement. All of the terms, covenants and conditions of the Loan
Agreement and the Security Documents are hereby made a part of this Note and
are
deemed incorporated herein in full. All capitalized terms used herein, unless
otherwise specifically defined in this Note, shall have the meanings ascribed
to
them in the Loan Agreement.
For
so
long as no Event of Default shall have occurred, the principal amount and
accrued interest of this Note shall be due and payable on the dates and in
the
manner hereinafter set forth:
(a)
Interest shall be due and payable monthly, in arrears, on the first day of
each
month, commencing on the first day of the month following the date hereof,
and
continuing until such time as the full principal balance, together with all
other amounts owing hereunder, shall have been paid in full;
(b)
Principal shall be due and payable monthly commencing on the first day of the
month following the date hereof, and continuing on the first day of each month
thereafter to and including the first day of ___________, _____ [the
59th month after the month in which the Equipment Loan Borrowing Date for the
Equipment Loan evidenced by this Note occurs],
in
installments of $__________ each [the
amount of the Equipment Loan evidenced by this Note divided by sixty
(60)];
and
(c)
The
entire remaining principal amount then outstanding, together with any and all
other amounts due hereunder, shall be due and payable on the first day of
____________,
_____ [the 60th month after the month in which the Equipment Loan Borrowing
Date
for the Equipment Loan evidenced by this Note occurs].
If,
prior
to the date on which this Note is required to be paid in full in accordance
with
the foregoing provisions, the Loan Agreement is terminated pursuant to Sections
5.2.1 or 5.2.2 thereof, then the entire unpaid principal balance and accrued
interest on this Note shall be immediately due and payable in full and shall
be
paid on the effective date of such termination.
Borrower
shall prepay this Note as provided in Section 4.5 of the Loan Agreement and
may
prepay this Note in whole at any time or in part from time to time as provided
in Section 4.6 of the Loan Agreement. All partial prepayments, whether mandatory
or voluntary, shall be applied ratably to the remaining installments of
principal due hereon.
Upon
the
occurrence of an Event of Default, Lender shall have all of the rights and
remedies set forth in Section 11 of the Loan Agreement.
To
the
fullest extent permitted by applicable law, Borrower, for itself and its legal
representatives, successors and assigns, expressly waives presentment, demand,
protest, notice of dishonor, notice of non-payment, notice of maturity, notice
of protest, presentment for the purpose of accelerating maturity, diligence
in
collection, and the benefit of any exemption or insolvency laws, except as
otherwise expressly provided in the Loan Agreement.
Wherever
possible, each provision of this Note shall be interpreted in such manner as
to
be effective and valid under applicable law, but if any provision of this Note
shall be prohibited or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity without invalidating
the remainder of such provision or remaining provisions of this Note. No delay
or failure on the part of Lender in the exercise of any right or remedy
hereunder shall operate as a waiver thereof, nor as an acquiescence in any
default, nor shall any single or partial exercise by Lender of any right or
remedy preclude any other right or remedy. Lender, at its option, may enforce
its rights against any collateral securing this Note without enforcing its
rights against Borrower or any other property or indebtedness due or to become
due to Borrower. Borrower agrees that, without releasing or impairing Borrower's
liability hereunder, Lender may at any time release, surrender, substitute
or
exchange any collateral securing this Note and may at any time release any
party
primarily or secondarily liable for the indebtedness evidenced by this
Note.
This
Note
shall be governed by, and construed and enforced in accordance with, the laws
of
the State of North Carolina and is intended to take effect as an instrument
under seal.
IN
WITNESS WHEREOF,
Borrower
has caused this Note to be duly executed and delivered on the date first above
written.
| Borrower: | ||
| CHAUTAUQUA AIRLINES, INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| REPUBLIC AIRWAYS HOLDINGS INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title : Executive Vice President & Chief Financial Officer | ||
| REPUBLIC AIRLINE INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
| SHUTTLE AMERICA CORPORATION | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |
|
|
||
| Title: Executive Vice President & Chief Financial Officer | ||
EXHIBIT
D
COMPLIANCE
CERTIFICATE
[Letterhead
of Borrower]
__________________,
20__
Bank
of
America, N.A.
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Southeast Loan Administration
Ladies
and Gentlemen:
The
undersigned, the chief financial officer of Republic Airlines Holdings Inc.,
a
Delaware corporation and its Subsidiaries (individually and collectively,
"Borrower"), gives this certificate to Bank of America, N.A. ("Lender") in
accordance with the require-ments of Section 9.1.3 of that certain Loan and
Security Agreement dated December 9, 1998, between Borrower and Lender (as
amended from time to time, the "Loan Agreement"). Capitalized terms used in
this
Certificate, unless otherwise defined herein, shall have the meanings ascribed
to them in the Loan Agreement.
1. Based
upon my review of the Consolidated balance sheets and statements of income
of
Borrower and its Subsidiaries for the Testing
Period ending __________________, 19__, copies of which are attached hereto,
I
hereby certify that:
(a) The
Consolidated Fixed Charges Coverage Ratio for such Testing Period is ____ to
1.0; and
(b) The
Consolidated Leverage Ratio as of the end of such Testing Period is _____ to
1.
2. No
Default exists on the date hereof, other than: ________________
__________________________________________________ [if
none,
so state];
and
3. No
Event
of Default exists on the date hereof, other than
____________________________________________________________ [if
none,
so state].
CHAUTAUQUA
AIRLINES, INC.
REPUBLIC
AIRLINE INC.
SHUTTLE
AMERICA CORPORATION
("Borrower")
|
By:
|
|
Chief
Financial
Officer
|
|
|
|
|
|
|
SCHEDULE
7.1.1
Spare
Parts Locations
The
Spare
Parts of Borrower are located at the following locations:
| 1. |
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇
|
| 2. |
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
|
| 3. |
▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 4. |
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 5. |
▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 6. |
▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇-▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇,
▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 7. |
Philadelphia
International Airport, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ #▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
|
| 8. |
Columbus
International Airport, ▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
|
| 9. |
US
Airways terminal room ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇
|
| 10. |
Orlando
International Airport, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 11. |
Dallas
Fort Worth International Airport, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇
▇▇▇▇▇
|
| 12. |
▇▇▇▇
▇. ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 13. |
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 14. |
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 15. |
Lambert
International Airport, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 16. |
Terminal
▇▇▇ ▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 17. |
Signature
Flight Support Hangar, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 18. |
▇▇▇▇▇▇
#▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇▇
|
| 19. |
Dulles
International Airport, 1 Saarineh Circle, Concourse D-DG196, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
| 20. |
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
| 21. |
▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
|
| 22. |
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
|
| 23. |
Philadelphia
International Airport, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇
|
▇▇▇▇▇