Atlantic Express amends 12% notes, floaters, 10% notes indentures

By Jennifer Chiou

New York, April 4 - Atlantic Express Transportation Corp. said it entered into a third supplemental indenture to amend its 12% senior secured notes due 2008, senior secured floating-rate notes due 2008 as well as its 10% third-priority secured notes due 2008.

The company obtained consents from holders of a majority of the three series of notes without paying a consideration.

The amendments include: the definition of the term asset sale to exclude the sale of accounts receivable; a permitted debt increase to $30 million from $20 million; changes to the limitation on asset sales covenant to require the company to apply 80% of net cash proceeds in excess of $10 million from asset sales to offer to repurchase the three notes series; and alterations of maintenance of consolidated EBITDA covenant so that it will not apply until the four consecutive quarters ending Dec. 31, 2006 and the requirement of a minimum consolidated EBITDA of $23 million.

On Dec. 6, the company announced that it may need to obtain a waiver from holders of its 12% notes and floating-rate notes if it does not meet the EBITDA maintenance covenant under the notes indenture. According to a 10-Q filing, the company had said it believes that it will have sufficient minimum last-12-months EBITDA to meet the EBITDA maintenance covenant of $27 million in the indenture at June 30.

Atlantic Express is a Staten Island, N.Y.-based school bus operator.

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