Exhibit 4.17
FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FIRST AMENDMENT TO LOAN AND SECURITY AGREEMENT (this "Amendment"),
dated as of March __, 2003, is entered into by and among FOOTHILL CAPITAL
CORPORATION, a California corporation, as agent (in such capacity, "Agent") for
the Lenders (defined below), the Lenders signatory hereto, MERCURY AIR GROUP,
INC. ("Parent") and Parent's Subsidiaries signatory hereto (each a "Borrower"
and together with Parent, "Borrowers").
RECITALS
A. Borrowers, Agent and the financial institutions from time to time party
thereto (the "Lenders") have previously entered into that certain Loan and
Security Agreement, dated as of December 30, 2002 (as amended, modified or
supplemented, the "Loan Agreement"), pursuant to which the Lenders have made
certain loans and financial accommodations available to Borrowers. Capitalized
terms used herein without definition shall have the meanings ascribed thereto in
the Loan Agreement.
B. Agent, the Lenders and Borrowers wish to amend the Loan Agreement under
the terms and conditions set forth in this Amendment. Borrowers are entering
into this Amendment with the understanding and agreement that, except as
specifically provided herein, none of Agent's or any Lender's rights or remedies
as set forth in the Loan Agreement is being waived or modified by the terms of
this Amendment.
C. Borrowers currently have an Account owing from Cielos de Peru ("Cielos")
in the approximate amount of $4,000,000 (the "Cielos Account"). On or about
March 7, 2003, Borrowers informed Agent of their intent to convert $2,000,000 of
the Cielos Account into a note receivable owing by Cielos for the benefit of
Borrowers (the "Cielos Account Conversion").
D. On March 10, 2003, Agent informed Borrowers that, pursuant to paragraph
(l) of the definition of "Eligible Accounts", effective as of March 11, 2003,
Agent has deemed $2,000,000 of the Cielos Account (the portion intended for
conversion under the Cielos Account Conversion) to be excluded from the Eligible
Accounts. Agent further indicated to Borrowers that it may, in Agent's Permitted
Discretion, at a future date, deem the remaining portion of the Cielos Account
to be excluded from the Eligible Accounts.
AMENDMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows (initially capitalized terms used herein without definition shall have
the meanings given in the Loan Agreement):
1. Amendments to Loan Agreement.
(a) Section 2.12 of the Loan Agreement is hereby amended by adding the
following subsection (g):
"(g) With respect to the Revenue Bond Letter of Credit or any L/C
issued in replacement thereof or supplement thereto, in the event a
draw is made under such L/C as a result of a tendering of the Bonds
(as defined therein), which is not reimbursed by Borrowers and the
amount of such draw is then, in accordance with the terms of this
Agreement, deemed an Advance ("Bond Tender Advance"), Borrowers agree
that any remarketing or similar proceeds received by any Borrower, net
of any applicable expenses, with respect to any remarketed Bonds
("Remarketing Proceeds") shall immediately be remitted to Agent for
application to the Bond Tender Advance or as may otherwise be required
by the terms of this Agreement. The aggregate amount of any
Remarketing Proceeds or other amounts received by Agent and applied to
the Bond Tender Advance shall thereafter become a reserve against
Availability in such amount, which Availability Reserve shall remain
in effect until the earlier to occur of: (a) the reinstatement of the
Revenue Bond Letter of Credit in connection with a remarketing of the
Bonds or (b) the termination of Parent's and all Borrowers'
obligations under that certain Loan Agreement between CEDFA and
Parent, dated April 1, 1998, relating to the Bonds."
(b) Section 7.19(c) of the Loan Agreement is hereby deleted and restated in
its entirety as follows:
"(c) MINIMUM EXCESS AVAILABILITY. Fail to maintain Excess
Availability of (i) $2,500,000 at all times, or (ii) $1,250,000 during
the period commencing on March 10, 2003 and ending on March 16, 2003."
(c) The following is hereby added as Section 6.16 of the Loan Agreement:
"6.16 ADDITIONAL COVENANTS. In the event Borrowers convert any
portion of any Account into a note receivable owed by the applicable
Account Debtor to any Borrower, such Borrower agrees to deliver to
Agent, for the benefit of the Lenders, within one (1) day of the
receipt of such note, the original note together with an endorsement
executed in blank with respect thereto and copies of any other
documents executed by such Account Debtor for the benefit of
Borrowers."
2. Effectiveness of Amendment. Agent must have received this Amendment and
the attached Acknowledgement by Guarantors, each fully executed in a sufficient
number of counterparts for distribution to all parties, before this Amendment is
effective, and before any Lender is required to extend any credit to any
Borrower as provided for by this Amendment.
3. Representations and Warranties. Each Borrower represents and warrants as
follows:
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(a) Authority. Each Borrowers has the requisite corporate power and
authority to execute and deliver this Amendment, and to perform its obligations
hereunder and under the Loan Documents (as amended or modified hereby) to which
it is a party. The execution, delivery and performance by each Borrower of this
Amendment have been duly approved by all necessary corporate action, have
received all necessary governmental approval, if any, and do not contravene any
law or any contractual restrictions binding on each Borrower. No other corporate
proceedings are necessary to consummate such transactions.
(b) Enforceability. This Amendment has been duly executed and delivered
by the Borrowers. This Amendment and each Financing Agreement (as amended or
modified hereby) is the legal, valid and binding obligation of Borrowers,
enforceable against each Borrower in accordance with its terms, and is in full
force and effect.
(c) Representations and Warranties. The representations and warranties
contained in each Financing Agreement (other than any such representations or
warranties that, by their terms, are specifically made as of a date other than
the date hereof) are correct on and as of the date hereof as though made on and
as of the date hereof.
(d) Additional Representations. Borrowers hereby agree and acknowledge
that the portion of the Cielos Account which may be converted pursuant to the
Cielos Account Conversion will be excluded from the Eligible Accounts. Borrowers
also agree and acknowledge that Agent has informed Borrowers that Agent may, in
Agent's Permitted Discretion, at a future date, deem the remaining portion of
the Cielos Account or any other Account which is converted into a note
receivable owed by the applicable Account Debtor to Borrowers, to be excluded
from the Eligible Accounts.
(e) No Default. After giving effect to this Amendment, no event has
occurred and is continuing that constitutes an Event of Default and by entering
into this Amendment, Agent is not waiving and shall not be deemed to have waived
any Event of Default that may exist.
4. Choice of Law. The validity of this Amendment, its construction,
interpretation and enforcement, the rights of the parties hereunder, shall be
determined under, governed by, and construed in accordance with the internal
laws of the State of New York governing contracts only to be performed in that
State.
5. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties and separate counterparts, each of which
when so executed and delivered, shall be deemed an original, and all of which,
when taken together, shall constitute one and the same instrument. Delivery of
an executed counterpart of a signature page to this Amendment by telefacsimile
shall be effective as delivery of a manually executed counterpart of this
Amendment.
6. Reference to and Effect on the Loan Documents.
(a) Upon and after the effectiveness of this Amendment, each reference
in the Loan Agreement to "this Agreement", "hereunder", "hereof" or words of
like import referring to the Loan Agreement, and each reference in the other
Loan Documents to "the Loan Agreement",
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"thereof" or words of like import referring to the Loan Agreement, shall mean
and be a reference to the Loan Agreement as modified and amended hereby.
(b) Except as specifically amended above, the Loan Agreement and all
other Loan Documents, are and shall continue to be in full force and effect and
are hereby in all respects ratified and confirmed and shall constitute the
legal, valid, binding and enforceable obligations of each Borrower to Agent
without defense, offset, claim or contribution.
(c) The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of Agent under any of the Loan Documents, nor constitute a
waiver of any provision of any of the Loan Documents.
(d) To the extent that any terms and conditions in any of the Loan
Documents shall contradict or be in conflict with any terms or conditions of the
Loan Agreement, after giving effect to this Amendment, such terms and conditions
are hereby deemed modified or amended accordingly to reflect the terms and
conditions of the Loan Agreement as modified or amended hereby.
7. Ratification. Each Borrower hereby restates, ratifies and reaffirms each
and every term and condition set forth in the Loan Agreement, as amended hereby,
and the Loan Documents effective as of the date hereof.
8. Estoppel. To induce Agent and the Lenders to enter into this Amendment
and to continue to make advances to Borrowers under the Loan Agreement, each
Borrower hereby acknowledges and agrees that, after giving effect to this
Amendment, as of the date hereof, there exists no Event of Default and no right
of offset, defense, counterclaim or objection in favor of any Borrower as
against Agent or any Lender with respect to the Obligations.
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IN WITNESS WHEREOF, the parties have entered into this Amendment as of the
date first above written.
FOOTHILL CAPITAL CORPORATION,
a California corporation,
as Agent and as a Lender
By:
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Title:
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ABLECO FINANCE LLC,
a Delaware limited liability company,
as a Lender
By:
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Title:
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MERCURY AIR GROUP, INC.,
a Delaware corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTERS, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CARGO, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
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MERCFUEL, INC.,
a Delaware corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MAYTAG AIRCRAFT CORPORATION,
a Colorado corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-BIRMINGHAM, LLC,
an Alabama limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-BAKERSFIELD, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-BURBANK, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-FRESNO, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
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MERCURY AIR CENTER-LOS ANGELES, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-ONTARIO, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-SANTA XXXXXXX, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-HARTSFIELD, LLC,
a Georgia limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-PEACHTREE-DEKALB, LLC,
a Georgia limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
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MERCURY AIR CENTER- FT. XXXXX, LLC.,
an Indiana limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-JACKSON, LLC.,
a Mississippi limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-RENO, LLC,
a Nevada limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-TULSA, LLC.,
an Oklahoma limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-CHARLESTON, LLC.,
a South Carolina limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-XXXXX ISLAND, LLC.,
a South Carolina limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
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MERCURY AIR CENTER-NASHVILLE, LLC.,
a Delaware limited liability company
By: Xxxxxx X. Xxxxxx
Title: Manager
MERCURY AIR CENTER-ADDISON, INC.,
a Texas corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
MERCURY AIR CENTER-CORPUS CHRISTI, INC.,
a Texas corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
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ACKNOWLEDGEMENT BY GUARANTORS
Dated as of March __, 2003
Each of the undersigned, being a Guarantor (each a "Guarantor" and
collectively, the "Guarantors") under their respective Guaranty and Security
Agreement, dated December 30, 2002 and made in favor of Agent for the benefit of
the Lenders (each a "Guaranty" and collectively, the "Guaranties"), hereby
acknowledges and agrees to the foregoing First Amendment to Loan and Security
Agreement (the "Amendment") and confirms and agrees that its Guaranty is and
shall continue to be, in full force and effect and is hereby ratified and
confirmed in all respects except that, upon the effectiveness of, and on and
after the date of the Amendment, each reference in such Guaranty to the Loan
Agreement (as defined in the Amendment), "thereunder", "thereof" or words of
like import referring to the "Loan Agreement", shall mean and be a reference to
the Loan Agreement as amended or modified by the Amendment. Although Lender has
informed Guarantors of the matters set forth above, and Guarantors have
acknowledged the same, each Guarantor understands and agrees that Lender has no
duty under the Loan Agreement, the Guaranties or any other agreement with either
Guarantor to so notify any Guarantor or to seek such an acknowledgement, and
nothing contained herein is intended to or shall create such a duty as to any
advances or transaction hereafter.
HERMES AVIATION, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
EXCEL CARGO, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
VULCAN AVIATION, INC.,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
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MERCURY ACCEPTANCE CORPORATION,
a California corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
JUPITER AIRLINE AUTOMATION SERVICES, INC.,
a Florida corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
AEG FINANCE CORPORATION,
a Delaware corporation
By: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
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