<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 2000
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 333-88593
For the transition period from _______ to ________
WORLDWIDE FLIGHT SERVICES, INC.
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware 75-1932711
- ---------------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization
1001 West Euless Boulevard
Suite 320
Euless, Texas 76040
- ----------------------------------------
(Address of principal executive offices)
(Registrant's telephone number, including area code) (817) 665-3200
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X]. No.[ ].
The number of shares of the registrant's Common Stock outstanding as of May 10,
2000 was 1,000 shares. There is no public trading market for the shares of the
registrant's common stock.
<PAGE> 2
CO-REGISTRANTS
<TABLE>
<CAPTION>
EXACT NAME STATE OR OTHER PRIMARY STANDARD
OF CO-REGISTRANT JURISDICTION OF INDUSTRIAL
AS SPECIFIED INCORPORATION OR CLASSIFICATION
IN ITS CHARTER ORGANIZATION CODE NUMBER
<S> <C> <C>
Worldwide Flight Finance Company Delaware 4581
Worldwide Flight Security Service Delaware 4581
Corporation
Miami International Airport Cargo Florida 4581
Facilities & Services, Inc.
International Enterprises Group, Inc. Florida 4581
Miami Aircraft Support, Inc. Delaware 4581
Aerolink International, Inc. Pennsylvania 4581
Aerolink Maintenance, Inc. Pennsylvania 4581
Aerolink Management, Inc. Pennsylvania 4581
Aerolink International, L.P. Pennsylvania 4581
Oxford Electronics, Inc. Delaware 4581
</TABLE>
i
<PAGE> 3
INDEX
<TABLE>
<CAPTION>
Page
Number
------
<S> <C>
Part I. Financial Information
Item 1 Financial Statements
Consolidated Statements of Operations for
the three months ended March 31, 2000 and March 31, 1999 2
Consolidated Balance Sheets as of
March 31, 2000 and December 31, 1999 3
Consolidated Statements of Cash Flows for the
three months ended March 31, 2000 and March 31, 1999 4
Notes to Consolidated Condensed Financial Statements 5
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Item 3 Quantitative and Qualitative Disclosures about Market Risk 10
Part II. Other Information
Item 6 Exhibits and Reports on Form 8-K 11
</TABLE>
<PAGE> 4
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements
within the meaning of Section 21E of the Securities Exchange Act of 1934. The
words "believe," "estimate," "anticipate," "project," "intend," "expect" and
similar expressions are intended to identify forward-looking statements. All
forward-looking statements involve some risks and uncertainties. In light of
these risks and uncertainties, the forward-looking events discussed in this
report might not occur. Factors that may cause actual results or events to
differ materially from those contemplated by the forward-looking statements
include, among other things, the following possibilities:
o future revenues are lower than expected;
o increase in payroll costs and/or shortage of an
adequate base of employees;
o loss of significant customers through bankruptcy;
o increase in debt levels beyond our ability to support
repayment;
o costs or difficulties relating to the integration of
businesses that we acquire are greater than expected;
o expected cost savings from our acquisitions are not
fully realized or realized within the expected time
frame;
o competitive pressures in the industry increase;
o general economic conditions or conditions affecting
the airline industry, whether internationally,
nationally or in the states in which we do business,
are less favorable than expected;
o changes in the interest rate environment generally;
and
o conditions in the securities markets are less
favorable than expected.
You are cautioned not to place undue reliance on forward-looking statements
contained in this report as these speak only as of its date. We undertake no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
1
<PAGE> 5
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
WORLDWIDE FLIGHT SERVICES, INC.
(FORMERLY AMR SERVICES CORPORATION)
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
(UNAUDITED)
WORLDWIDE PREDECESSOR
MARCH 31, MARCH 31,
2000 1999
--------- -----------
<S> <C> <C>
Revenues:
External customers $ 85,195 $ 38,640
Affiliates -- 22,835
-------- --------
Total operating revenues 85,195 61,475
Expenses
Salaries, wages, and benefits 57,466 39,679
Materials, supplies, and services 9,007 7,744
Equipment and facilities rental 4,948 3,641
Depreciation and amortization 3,921 1,627
Other miscellaneous expenses 8,710 4,784
General and administrative
allocated expenses -- 2,269
-------- --------
Total operating expenses 84,052 59,744
Operating income from continuing operations 1,143 1,731
Interest expense (5,004) --
Interest income 120 440
Other income (expense), net (12) (552)
-------- --------
Income (loss) from continuing operations
before income taxes (3,753) 1,619
Provision (benefit) for income taxes (528) 644
-------- --------
Income (loss) from continuing operations (3,225) 975
Loss from discontinued operations, net of tax
benefits of $139 -- (210)
-------- --------
Net income (loss) $ (3,225) $ 765
======== ========
</TABLE>
2
<PAGE> 6
WORLDWIDE FLIGHT SERVICES, INC.
(FORMERLY AMR SERVICES CORPORATION)
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
(UNAUDITED)
MARCH 31, DECEMBER 31,
2000 1999
--------- -----------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 5,920 $ 1,775
Restricted cash equivalent 750 750
Accounts receivable, less allowance for doubtful -- --
accounts 55,484 73,144
Deferred income taxes 5,462 4,305
Prepaid and other current assets 8,228 7,413
--------- ---------
TOTAL CURRENT ASSETS 75,844 87,387
EQUIPMENT AND PROPERTY:
Equipment and property, at cost 47,991 45,915
Less accumulated depreciation (5,045) (3,185)
--------- ---------
42,946 42,730
Intangible assets including Goodwill, net 106,026 105,559
Other long-term assets 9,615 10,465
--------- ---------
TOTAL ASSETS $ 234,431 $ 246,141
========= =========
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
Accounts payable $ 27,754 $ 23,350
Accrued salaries, wages and benefits 11,104 13,308
Other accrued liabilities 13,183 21,404
Current portion of long-term debt 2,132 2,876
--------- ---------
TOTAL CURRENT LIABILITIES 54,173 60,938
DEFERRED INCOME TAXES 14,233 14,233
LONG TERM DEBT, LESS CURRENT PORTION 133,057 137,081
STOCKHOLDER'S EQUITY:
Common stock -- --
Additional paid-in-capital 40,714 38,918
Retained earnings (deficit) (6,422) (3,197)
Accumulated other comprehensive loss (1,324) (1,832)
--------- ---------
TOTAL STOCKHOLDER'S EQUITY 32,968 33,889
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 234,431 $ 246,141
========= =========
</TABLE>
3
<PAGE> 7
WORLDWIDE FLIGHT SERVICES, INC.
(FORMERLY AMR SERVICES CORPORATION)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
(UNAUDITED)
WORLDWIDE PREDECESSOR
MARCH 31, MARCH 31,
2000 1999
---------- -----------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $ (3,225) $ 765
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization 3,921 1,627
Deferred income taxes (1,157) 1,584
Change in assets and liabilities:
Accounts receivable 17,285 (4,190)
Other, net (1,248) 183
Accounts payable and accrued liabilities (6,020) (7,117)
-------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 9,556 (7,148)
INVESTING ACTIVITIES:
Capital expenditures (2,439) (1,688)
Other -- 26
-------- --------
NET CASH USED BY INVESTING ACTIVITIES (2,439) (1,662)
FINANCING ACTIVITIES:
Payments on long-term debt (4,768) --
Equity contribution by parent 1,796 --
Dividend to parent -- (5,390)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (2,972) (5,390)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 4,145 (14,200)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,775 14,200
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 5,920 $ --
======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid (refunded) for income taxes $ 330 $ (1,079)
Cash paid for interest $ 8,564 $ --
</TABLE>
4
<PAGE> 8
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - Introduction and Basis of Presentation
On March 31, 1999, MR Services Corporation completed the acquisition of all of
the outstanding stock of AMR Services Corporation ("Predecessor"), a wholly
owned subsidiary of AMR Services Holding Corporation, which was a wholly owned
subsidiary of AMR Corporation, the parent company of American Airlines, Inc.
("American"). MR Services Acquisition Corporation was immediately merged with
and into AMRS, and AMRS, the surviving corporation was renamed Worldwide Flight
Services, Inc. ("Worldwide"). Worldwide is owned by WFS Holdings, Inc. The
initial purchase price was $75.0 million plus subsequent possible adjustments.
On August 12, 1999, Worldwide purchased all of the stock of Miami Aircraft
Services, Inc. ("MAS"), an independent provider of express air cargo handling
services in the United States, for $63.0 million plus transaction costs. Also,
on August 23, 1999, Worldwide completed the acquisition of Aerolink
International, Inc. and affiliates ("Aerolink"), a provider of ground services,
located in Pittsburgh, Pennsylvania for a purchase price of $5.9 million plus
possible additional consideration. The operations of MAS and Aerolink are
included in the operations of Worldwide since the date of acquisition.
The accompanying unaudited consolidated financial statements included herein
have been prepared by the Company pursuant to generally accepted accounting
principles for interim financial information, and in accordance with the rules
and regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles for complete financial
statements have been excluded. The Company believes that the disclosures are
adequate to make the information presented not misleading. These consolidated
financial statements should be read in conjunction with the financial statements
and the notes to consolidated financial statements included in the Annual
Report, Form 10-K for the nine-month period ended December 31, 1999.
In the opinion of the Company, all adjustments that are normal recurring in
nature have been included that were necessary to present fairly the financial
position of Worldwide and subsidiaries as of March 31, 2000 and the results of
operations and cash flows for the three months ended March 31, 2000 and March
31, 1999, respectively. Operating results for the three-month period ended March
31, 2000 are not necessarily indicative of the results that may be expected for
the year ending December 31, 2000.
The accompanying consolidated interim financial statements include the accounts
of Worldwide together with its subsidiaries. The Company reports financial
information and evaluates its operations by locations and not by its four
different service areas. As a result, the Company has determined that it
operates under one reportable segment.
As more fully discussed in Note 4 below, the Company completed its acquisition
of Oxford Electronics, Inc. (Oxford) during the second quarter of 2000. Its
results of operations will be consolidated with those of the Company effective
April 1, 2000.
5
<PAGE> 9
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - Comprehensive Income
The components of comprehensive income (loss) for the Company include net income
(loss), and changes in the cumulative foreign currency translation. Total
comprehensive income (loss) for the three month periods ended March 31, 2000 and
March 31, 1999 was ($2.7) million and $1.0 million, respectively.
NOTE 3 - Capital Contributions
Capital contributions from parent included $1.0 million for the funding of the
Oxford acquisition (discussed below) and for $.8 million of cash received from
employees for stock purchases.
NOTE 4 - Subsequent Events
Oxford Electronics, Inc.
On April 5, the Company completed the acquisition of Oxford, a provider of
airport technical services, for a cash purchase price of $9.6 million at closing
and up to $2.5 million in deferred payments to be determined based on earnings
for Oxford's fiscal 2000. The purchase price was funded with borrowings under
the existing senior secured credit facility and a $1.0 million capital
contribution from its parent, which was actually received on March 24, 2000.
Primarily as a result of borrowings to fund the acquisition of Oxford and
working capital needs, the long-term debt increased to $155.0 million as of May
4, 2000. The acquisition will be accounted for under the purchase method of
accounting in the second quarter ended June 30, 2000. The Company filed Form 8-K
with the Securities and Exchange Commission on April 17, 2000 with a more
complete description of this acquisition.
6
<PAGE> 10
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
Overall Summary
Revenues, operating income, and loss from continuing operations for the three
months ended March 31, 2000 were $85.2 million, $1.1 million, and $3.2 million,
respectively. The results include contributions from MAS and Aerolink for the
entire quarter. As a result of the acquisition of Worldwide effective March 31,
1999, results for the quarter ended March 31, 2000 are not comparable to results
in the comparable period of the prior year. Financial information for the period
ended March 31, 1999 is that of the Predecessor, and as such is presented on a
different basis of accounting. However, for information purposes results of
operations for the three months ended March 31, 1999 have been included in this
analysis. The Predecessor reported revenue, operating income, and income from
continuing operations for the three months ended March 31, 1999 of $61.5
million, $1.7 million, and $1.0 million, respectively.
Revenues
Total revenues of $85.2 million increased $23.7 million from $61.5 million in
the prior year. The acquisitions of MAS and Aerolink in August, 1999 accounted
for $20.3 million of the increase. The remaining increase of $3.4 million is due
to new contracts.
Since the acquisition of AMRS, we have identified revenue information for the
cargo handling, ramp services, passenger services and technical services
categories. Prior to the acquisition, AMRS did not identify revenues in similar
categories. The following table contains, for the current quarter only, revenues
by cargo handling, ramp services, passenger services and technical services
categories (in thousands).
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 2000
------------------
<S> <C>
Cargo handling $ 39,233
Ramp services 19,325
Passenger services 15,678
Technical services 10,959
--------
Total $ 85,195
========
</TABLE>
7
<PAGE> 11
Salaries, wages and benefits
Salaries, wages and benefits of $57.5 million increased $17.8 million from $39.7
million in 1999. MAS and Aerolink contributed $12.7 million of the increase. The
remaining increase of $5.1 million is the result of costs associated with
increased sales volume over the prior year of approximately $2.2 million,
general and administrative salaries of $1.8 million for headquarters support
which had previously been allocated by AMR, and $1.1 million or 3% related to
higher labor costs.
Materials, supplies and services
Materials, supplies and services of $9.0 million increased $1.3 million from
$7.7 million in 1999. The increase is due to the acquisitions of MAS and
Aerolink.
Equipment and facilities rental
Equipment and facilities rental of $4.9 million increased $1.3 million from $3.6
million in the prior year. Once again, the increase is due to the acquisitions
of MAS and Aerolink.
Depreciation and amortization
Depreciation and amortization of $3.9 million increased $2.3 million from $1.6
million in 1999. Approximately $1.3 million of the increase is due to the
amortization of intangibles, including goodwill on the acquisitions of AMRS, MAS
and Aerolink. Approximately $1.0 million is additional depreciation expense from
the MAS and Aerolink.
Other miscellaneous expenses
Other miscellaneous expenses of $8.7 million increased $3.9 million from $4.8
million in the prior year. Approximately $1.6 million of the increase is due to
the operating expenses from MAS and Aerolink. The remaining increase of $2.3
million represents increased selling, general and administrative expenses for
functions which were previously allocated by AMR, and recurring costs associated
with the administration of an independent company including the accrual of
management fees from the parent company, and non-recurring costs associated with
the transition to an independent company.
General and administrative allocated expenses
Predecessor was allocated $2.3 million of general and administrative expense in
the three months ended March 31, 1999 for staff functions including finance,
human resources, legal, planning and executive management. The allocated
expenses have been replaced by direct expenses and personnel hired by the
Company as described above. There are no allocated expenses from AMR in the
first quarter of 2000.
8
<PAGE> 12
Operating income from continuing operations
As a result of the factors described above, operating income from continuing
operations of $1.1 million decreased $.6 million from $1.7 million in 1999. The
acquisitions of MAS and Aerolink contributed $2.1 million of operating income
(excluding goodwill amortization) offset by increased salaries, wages and
benefits from operations and additional selling, general and administrative
costs as discussed above.
LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL CONDITION
Cash and cash equivalents were $6.7 million (including restricted cash) at March
31, 2000, an increase of $4.1 million from $2.5 million at December 31, 1999.
Net cash provided by operating activities was $9.6 million during the three
month period ended March 31, 2000, reflecting the contribution from operating
earnings plus more effective working capital management particularly in accounts
receivable.
The Company reported a net reduction in working capital (excluding cash) of $8.9
million in the quarter. The reduction is primarily due to a decrease of $17.3
million in accounts receivable from improved collection efforts, however the
expectation for the remainder of the year is that accounts receivable will
fluctuate only from the normal seasonality of the business. The decrease in
accounts receivable was offset, in part, by reductions in accrued interest from
the semi-annual interest payment on the Senior Notes of $8.1 million on February
15, 2000. The next interest payment will be due on August 15, 2000.
As of March 31, 2000 the Company owed AMR approximately $7.5 million classified
as accounts payable on which the payment terms had been extended. Approximately
$1.6 million was paid in April with the remainder due in installments prior to
August 1, 2000.
Net cash used in investing activities for capital spending was $2.4 million and
$1.7 million for the three months ended March 31, 2000 and March 31, 1999,
respectively.
Net cash used in financing activities was $3.0 million and $5.4 million for the
three months ended March 31, 2000 and March 31, 1999, respectively. During the
current quarter the Company received an equity contribution of $1.8 million from
its parent offset by outside debt payments of $4.8 million. In the prior year,
the Predecessor paid a dividend of $5.4 million to AMR prior to the sale of the
Company. At March 31, 2000, the Company had total debt of $135.2 million.
On April 5, 2000 the Company completed the acquisition of Oxford, a provider of
airport technical services, for a cash purchase price of $9.6 million at closing
and up to $2.5 million in deferred payments to be determined in 2001 based on
earnings for Oxford's fiscal 2000. The purchase price was funded with borrowings
under the existing senior secured credit facility and a $1.0 million capital
contribution from its parent, which was actually received on March 31, 2000.
The Company maintains a senior secured credit facility with a group of lenders
that provides up to $75.0 million for purposes of funding working capital
requirements and funding financing needs for future acquisitions. As of May 4,
2000, the Company had drawn $25.5 million under
9
<PAGE> 13
the credit facility with an additional $1.5 million allocated to issued letters
of credit. Future additional availability under the senior secured credit
facility may be less than the total remaining commitment amount and will depend
on the borrowing base ($39.1 million as of March 31, 2000) and the ability to
meet the applicable leverage and coverage ratios and other customary conditions.
If the Company defaults under the credit facility due to the failure to maintain
financial ratios or meet other covenants, it may not be able to make additional
borrowings under that facility.
On March 31, 2000 the Company complied with all debt covenants. On May 4, 2000
the Company had approximately $11.0 million in cash and cash equivalents and
committed and discretionary unused lines of credit aggregating an additional
$12.1 million. Management believes that internally-generated funds and
borrowings under existing credit facilities will be adequate to meet working
capital and capital expenditure requirements.
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Information about market risks for the three months ended March 31, 2000 does
not differ materially from that discussed under Item 7A of the Company's Annual
Report on Form 10-K for the year ended December 31, 1999.
10
<PAGE> 14
PART II
OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibit 10.1. Amendment and Waiver No. 1, dated as of March 24,
2000, to the Credit Agreement, dated August 12, 1999, among WFS
Holdings, Inc., Worldwide Flight Services, Inc., the Lenders
listed therein and The Chase Manhattan Bank as administrative
agent.
Exhibit 27.1. Financial Data Schedule.
(b) Form 8-K for the purchase of Oxford Electronics Inc. was filed on
April 17, 2000.
11
<PAGE> 15
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
WORLDWIDE FLIGHT SERVICES, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 16
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
WORLDWIDE FLIGHT FINANCE COMPANY
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
President
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 17
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
WORLDWIDE FLIGHT SECURITY SERVICE
CORPORATION
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: President
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 18
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
MIAMI INTERNATIONAL AIRPORT CARGO
FACILITIES & SERVICES, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
President
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 19
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
INTERNATIONAL ENTERPRISES GROUP, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 20
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
MIAMI AIRCRAFT SUPPORT, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 21
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
AEROLINK INTERNATIONAL, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 22
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
AEROLINK MAINTENANCE, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 23
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
AEROLINK MANAGEMENT, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 24
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
AEROLINK INTERNATIONAL, L.P.
By: AEROLINK MANAGEMENT, INC.
Its general partner
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 25
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Euless, State of Texas on the 15th day of May, 2000.
OXFORD ELECTRONICS, INC.
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chairman of the Board and
Chief Executive Officer
By: /s/ Donna Reeves
------------------------------------
Name: Donna Reeves
Title: Controller (principal financial
and accounting officer)
<PAGE> 26
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
10.1 Amendment and Waiver No. 1, dated as of March 24, 2000, to the
Credit Agreement, dated August 12, 1999, among WFS Holdings,
Inc., Worldwide Flight Services, Inc., the Lenders listed
therein and The Chase Manhattan Bank as administrative agent.
27.1 Financial Data Schedule.
</TABLE>
<PAGE> 1
EXHIBIT 10.1
AMENDMENT AND WAIVER NO. 1 dated as of March 24, 2000
(this "Amendment") to the Credit Agreement dated as of
August 12, 1999 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"), among
WFS HOLDINGS, INC., a Delaware corporation, WORLDWIDE FLIGHT
SERVICES, INC., a Delaware corporation (the "Company"), the
lenders listed in Schedule 2.01 thereto (the "Lenders") and
THE CHASE MANHATTAN BANK, a New York banking corporation, as
administrative agent for the Lenders (in such capacity, the
"Administrative Agent").
The Company has requested that certain provisions of the Credit
Agreement be amended or waived in the manner provided for in this Amendment, and
the Lenders are willing to agree to such amendments and waivers as provided for
in this Amendment.
Accordingly, on the terms and subject to the conditions set forth
herein the parties hereto hereby agree as follows:
1. Defined Terms. Capitalized terms used and not defined herein shall
have the meanings given to them in the Credit Agreement.
2. Amendments. (a) Section 1.01 of the Credit Agreement is hereby
amended by deleting the definition of "Consolidated EBITDA" and replacing it
with the following definition:
"Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) consolidated
interest expense for such period, (ii) consolidated income tax expense and
other taxes based on net income for such period, (iii) all amounts
attributable to depreciation and amortization for such period, (iv) amounts
accrued in respect of the management fees owed to Castle Harlan under the
Management Agreement, whether or not paid, and (v) any extraordinary losses
or nonrecurring non-cash charges for such period, and minus (b) without
duplication and to the extent included in determining such Consolidated Net
Income, any extraordinary or non-cash gains or other non-cash items for
such period, all determined on
<PAGE> 2
a consolidated basis in accordance with GAAP. For purposes of calculating
Consolidated EBITDA for any period (each, a "Reference Period") in
connection with a determination of the Leverage Ratio or the Senior
Leverage Ratio for such period, if during such Reference Period (or, in the
case of pro forma calculations, during the period from the last day of such
Reference Period to and including the date as of which such calculation is
made) the Borrower or any Subsidiary shall have made a Material Disposition
or Material Acquisition, Consolidated EBITDA for such Reference Period
shall be calculated after giving pro forma effect thereto as if such
Material Disposition or Material Acquisition occurred on the first day of
such Reference Period (with the Reference Period for the purposes of pro
forma calculations being the most recent period of four consecutive fiscal
quarters for which the relevant financial information is available);
provided, that such pro forma calculations shall not give effect to
operating expense reductions and other cost savings, other than as approved
by the Administrative Agent. As used in this definition, "Material
Acquisition" means any Permitted Acquisition or series of related Permitted
Acquisitions that involves consideration (including any noncash
consideration) with a fair market value in excess of $2,500,000; and
"Material Disposition" means any disposition of property or series of
related dispositions of property that involves assets comprising all or
substantially all of an operating unit of a business or constitutes all or
substantially all of the Equity Interests of a Subsidiary.
(b) Section 1.01 of the Credit Agreement is hereby amended by deleting
the definition of "Total Indebtedness" and replacing it with the following
definition:
"Total Indebtedness" means, as of any date, the sum of (a) the
aggregate principal amount of Indebtedness of the Borrower and the
Subsidiaries outstanding as of such date, in the amount that would be
reflected on a balance sheet prepared as of such date on a consolidated
basis in accordance with GAAP, plus (b) the aggregate principal amount of
Indebtedness of the Borrower and the Subsidiaries outstanding as of such
date that is not required to be reflected on a balance sheet in accordance
with GAAP (except for any such Indebtedness attributable to the issuance
discount of the Senior Notes), determined on a consolidated basis.
<PAGE> 3
3. Waivers. (a) The Lenders hereby waive any Default or Event of
Default resulting from a failure to comply with Section 6.12, Section 6.13 or
Section 6.14 of the Credit Agreement to the extent that, and only to the extent
that, such Default or Event of Default would not have occurred if the amendments
to the Credit Agreement provided for in Section 2 of this Amendment had become
effective on the Effective Date.
(b) Subject to paragraph (c) below, the Lenders hereby waive any
Default or Event of Default resulting from a failure to comply with Section
5.01(f) of the Credit Agreement with respect to the budget to be delivered for
the fiscal year of the Borrower beginning on January 1, 2000.
(c) The waiver provided for by paragraph (b) above shall cease to be
effective and have no further force and effect at 12:01 a.m., New York City
time, April 15, 2000, and at such time and at all times thereafter the Credit
Agreement shall apply in all respects as originally in effect without regard to
such waiver, and the Administrative Agent and the Lenders shall have all rights
and remedies under the Credit Agreement that they would have had if such waiver
had never been granted.
4. No Other Amendments or Waivers; Confirmation. Except as expressly
amended or waived hereby, the provisions of the Credit Agreement are and shall
remain in full force and effect.
5. Representations and Warranties. The Company hereby represents and
warrants to the Administrative Agent and the Lenders as of the date hereof:
(a) After giving effect to the waiver provided for herein, no Default
or Event of Default has occurred and is continuing.
(b) All representations and warranties of the Company contained in the
Credit Agreement (other than representations or warranties expressly made
as of an earlier date) are true and correct in all material respects on and
as of the date hereof with the same force and effect as if made on and as
of the date hereof.
6. Effectiveness. This Amendment shall become effective only upon the
receipt by the Administrative Agent of counterparts hereof, duly executed and
delivered by the Borrower and the Required Lenders.
<PAGE> 4
7. EXPENSES. The Borrower agrees to reimburse the Administrative Agent
for its out-of-pocket expenses in connection with this Amendment, including the
reasonable fees, charges and disbursements of Cravath, Swaine & Moore, counsel
for the Administrative Agent.
8. GOVERNING LAW; COUNTERPARTS. (a) This Amendment and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York.
(b) This Amendment may be executed by one or more of the parties
hereto on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.
<PAGE> 5
This Amendment may be delivered by facsimile transmission of the relevant
signature pages hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first written above.
WFS HOLDINGS, INC.,
By: /s/ Marcel Fournier
------------------------------------
Name: Marcel Fournier
Title: President
WORLDWIDE FLIGHT SERVICES, INC.,
By: /s/ Peter A. Pappas
------------------------------------
Name: Peter A. Pappas
Title: Chief Executive Officer
THE CHASE MANHATTAN BANK,
individually and as Administrative Agent
By: /s/ Matthew H. Massie
------------------------------------
Name: Matthew H. Massie
Title: Managing Director
<TABLE> <S> <C>
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<NAME> WORLDWIDE FLIGHT SERVICES, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-2000
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<RECEIVABLES> 57,287
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0
0
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<INCOME-PRETAX> (3,753)
<INCOME-TAX> (528)
<INCOME-CONTINUING> (3,225)
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<NET-INCOME> (3,225)
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