Exhibit 10.2
FIRST AMENDMENT TO
BUSINESS LOAN AND SECURITY AGREEMENT
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THIS FIRST AMENDMENT TO
BUSINESS LOAN AND SECURITY AGREEMENT (this
"Agreement") made as of the 21st day of May, 2008 by and among VSE
CORPORATION,
a corporation organized under the laws of the State of Delaware
("VSE"),
ENERGETICS INCORPORATED, a corporation organized under the laws of
the State of
Maryland ("Energetics"), VSE SERVICES INTERNATIONAL, INC., a
corporation
organized under the laws of the State of Delaware ("VSI"),
INTEGRATED CONCEPTS
AND RESEARCH CORPORATION, a corporation organized under the laws of
the District
of Columbia ("ICRC"), G&B SOLUTIONS, INC., a corporation
organized under the
laws of the Commonwealth of Virginia ("G&B"), jointly and
severally (each of
VSE, Energetics, VSI, ICRC and G&B a "Borrower"; and
collectively, the
"Borrowers") and CITIZENS BANK OF PENNSYLVANIA, a bank chartered in
the State of
Pennsylvania, its successors and assigns (the "Lender").
RECITALS
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A. The Lender has
made a revolving line of credit in the current
maximum principal amount of Twenty-Five Million Dollars
($25,000,000), jointly
and severally, to the Borrowers (the "Loan") pursuant to that
certain Business
Loan and Security Agreement, dated August 14, 2007, by and among
VSE,
Energetics, VSI, ICRC and the Lender (the Business Loan and
Security Agreement,
as amended from time to time, is hereinafter called, the "Business
Loan
Agreement").
B. The Loan is
currently evidenced by that certain Revolving
Promissory Note, dated August 14, 2007, from VSE, Energetics, VSI,
and ICRC in
favor of the Lender in the maximum principal amount of Twenty-Five
Million
Dollars ($25,000,000) (as amended from time to time, is hereinafter
called the
"Note").
C. Pursuant to
that certain Additional Borrower Joinder Supplement
dated April 14, 2008 by and among VSE, Energetics, VSI, ICRC,
G&B and Lender,
G&B was added as a party to each of the Financing
Documents.
D. The Borrowers
have requested that the Lender increase the
maximum principal amount of the Loan and revise other provisions of
the Business
Loan Agreement and the Lender has agreed on the condition, among
others, that
this Agreement be executed and delivered by the Borrowers to the
Lender.
E. All capitalized
terms used herein and not otherwise defined
shall have the meanings given to such terms in the Business Loan
Agreement.
NOW, THEREFORE, in
consideration of the premises, the mutual agreements
herein contained, and other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as
follows:
1. Recitals. The parties
hereto acknowledge and agree that the above
Recitals are true and correct in all respects and that the same are
incorporated
herein and made a part hereof by reference.
2. Definitions.
(a) The following defined terms set forth in Section 1.1 of
the Business Loan Agreement are amended and restated in their
entirety as
follows:
"Fees" means the collective
reference to each fee payable to the Lender,
under the terms of this Agreement or under the terms of any of the
other
Financing Documents, including, without limitation, the Revolving
Credit Unused
Line Fees, Letter of Credit Fees and the Field Examination
Fees.
"Leverage Ratio" means the
ratio of Total Funded Debt on a specified date
to EBITDA for the four (4) quarter period then ending on such
date.
"LIBOR rate" means the London
interbank offered rate of major banks for
deposits in United States Dollars for a designated period (e.g.
one, two, three
or six months) as set forth at Telerate Page 3750 at approximately
11:00 a.m.
London time on the third Euro-Dollar Business Day preceding the
date when the
LIBOR-based Rate will be become effective; provided, however, that
if such
information is not available on Telerate, the "LIBOR rate" shall be
determined
from information supplied to the Lender by a nationally recognized
reporting
service for similar information acceptable to the Lender.
"LIBOR Rate Margin" means the
amount determined to be in effect from time
to time using the chart set forth below. The initial LIBOR
Rate Margin will be
determined at the Supplemental Closing Date using the Leverage
Ratio calculated
by reference to the consolidated financial statements of VSE most
recently
received by the Lender. Commencing on the date following the
Supplemental
Closing Date when the Lender receives the consolidated financial
statements of
VSE in accordance with this Agreement and on each such date
thereafter, the
LIBOR Rate Margin will be reset based on the Leverage Ratio
calculated by
reference to such consolidated financial statements.
LIBOR Rate
Margin
Leverage Ratio
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1.25%
Less than 1.0 to 1.0
1.75%
Equal to or greater than 1.0 to 1.0 but
less
than 2.0 to 1.0
2.00%
Equal to or greater than 2.0 to 1.0
In the event VSE fails to
provide such consolidated financial statements
when due, the LIBOR Rate Margin shall be 2.00% until such time as
such
consolidated financial statements are submitted as required by this
Agreement.
"Obligations" means all
present and future, whether now existing or
contemplated or hereafter arising, of any one or more of the
Borrowers to the
Lender under, arising pursuant to, in connection with and/or on
account of the
provisions of this Agreement, each Note, each Security Document,
and/or any of
the other Financing Documents, the Loans, and/or any of the
Facilities
including, without limitation, the principal of, and interest on,
each Note,
late charges, the Fees, Enforcement Costs, and prepayment fees (if
any), letter
of credit reimbursement obligations, letter of credit fees or fees
charged with
respect to any guaranty of any letter of credit; also means all
other present
and future indebtedness, duties, obligations, and liabilities,
whether now
existing or contemplated or hereafter arising, of any one or more
of the
Borrowers to the Lender or its Affiliates of any nature whatsoever,
including,
without limitation, any indebtedness, duties, obligations, and
liabilities,
under or in connection with, any Swap Transaction or Bank Products,
regardless
of whether such indebtedness, duties, obligations, and liabilities
be direct,
indirect, primary, secondary, joint, several, joint and several,
fixed or
contingent; and also means any and all renewals, extensions,
substitutions,
amendments, restatements and rearrangements of any such
indebtedness, duties,
obligations, and liabilities.
"Prime Rate Margin" means zero
percent (0.0%).
"Revolving Credit Expiration
Date" means May 21, 2010.
(b) The following defined terms are added in alphabetical
order to Section 1.1 of the Business Loan Agreement:
"Bank Products" shall mean any
(i) commercial credit card, purchase card
and merchant card services, or other commercial credit card
services or
facilities, (ii) cash management services or facilities, (iii)
foreign
investment or exchange products or services or (iv) products under
any non-
speculative hedging agreement or arrangement, extended to any
Borrower by Lender
or any Affiliate of Lender, from time to time.
"EBITDA" means as to Borrowers
for any period of determination thereof,
the sum of (a) net profit (or loss) determined in accordance with
GAAP
consisten
