-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BmMSrC+8tPhvhCrHI4TO+ZnbaTr1s41kQrGO2bBKSpuoNcsQpoA8qH6LhtokY+bH 9El3LgqNCMIaqoamgDeXpw== 0000950131-01-504161.txt : 20020410 0000950131-01-504161.hdr.sgml : 20020410 ACCESSION NUMBER: 0000950131-01-504161 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: APCOA INC CENTRAL INDEX KEY: 0001059262 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-AUTO RENTAL & LEASING (NO DRIVERS) [7510] IRS NUMBER: 161171179 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-50437 FILM NUMBER: 1788235 BUSINESS ADDRESS: STREET 1: 900 N. MICHIGAN AVENUE CITY: CHICAGO STATE: IL ZIP: 60611-1542 BUSINESS PHONE: 2185220700 10-Q 1 d10q.txt FORM 10-Q ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------- FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2001 Commission file number: 333-50437 --------------------- APCOA/STANDARD PARKING, INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 16-1171179 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 900 N. Michigan Avenue Chicago, Illinois 60611-1542 (Address of Principal Executive Offices, Including Zip Code) (312) 274-2000 (Registrant's Telephone Number, Including Area Code) Former name, address and fiscal year, if changed since last report: N/A 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 As of November 14, 2001, there were 31.31 shares of common stock of the registrant outstanding. ================================================================================ APCOA/STANDARD PARKING, INC. FORM 10-Q INDEX Part I. Financial Information Item 1. Financial Statements (Unaudited): Condensed Consolidated Balance Sheets as of September 30, 2001 and December 31, 2000 ........................................ 3 Condensed Consolidated Statements of Operations for the three months ended September 30, 2001 and September 30, 2000 and for the nine months ended September 30, 2001 and September 30, 2000 ....................................... 4 Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2001 and September 30, 2000 ....... 5 Notes to Condensed Consolidated Financial Statements ......... 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ..........................10 Item 3. Quantitative and Qualitative Disclosures About Market Risk ...15 Part II. Other Information Item 1. Legal Proceedings ............................................16 Item 2. Changes in Securities and Use of Proceeds ....................16 Item 3. Defaults upon Senior Securities ..............................16 Item 4. Submission of Matters to a Vote of Security Holders ..........16 Item 5. Other Information ............................................16 Item 6. Exhibits and Reports on Form 8-K .............................17 Signatures ...................................................................18 Index to Exhibits ............................................................19 2 PART I FINANCIAL INFORMATION Item 1. Financial Statements APCOA/STANDARD PARKING, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except for share data)
September 30, 2001 December 31, 2000 ------------------ ----------------- ASSETS (Unaudited) (see Note) ------ Current assets: Cash and cash equivalents ......................................... $ 9,280 $ 3,539 Notes and accounts receivable, net ................................ 45,604 46,826 Prepaid expenses and supplies ..................................... 1,303 1,775 --------- ---------- Total current assets .............................................. 56,187 52,140 --------- ---------- Leaseholds and equipment, net ....................................... 24,101 28,492 Advances and deposits ............................................... 1,338 2,075 Cost in excess of net assets acquired ............................... 115,467 113,293 Intangible and other assets ......................................... 11,002 12,341 --------- ---------- Total assets ...................................................... $ 208,095 $ 208,341 ========= ========== LIABILITIES AND STOCKHOLDERS' DEFICIT ------------------------------------- Current liabilities: Accounts payable .................................................. $ 33,565 $ 35,079 Accrued and other current liabilities ............................. 19,935 27,596 Current portion of long-term borrowings ........................... 39,779 1,406 --------- ---------- Total current liabilities ......................................... 93,279 64,081 Long-term borrowings, excluding current portion ..................... 145,551 173,590 Other long-term liabilities ......................................... 13,584 10,121 Redeemable preferred stock .......................................... 59,676 54,976 Common stock subject to put/call rights; 5.01 shares issued and outstanding ................................ 8,255 6,304 Common stockholders' deficit: Common stock, par value $1.00 per share; 1,000 shares authorized; 26.3 shares issued and outstanding ............................... 1 1 Additional paid-in capital ........................................ 11,422 11,422 Advances to and deposits with affiliates .......................... (7,950) (11,979) Accumulated other comprehensive loss .............................. (750) (374) Accumulated deficit ............................................... (114,973) (99,801) --------- ---------- Total common stockholders' deficit ................................ (112,250) (100,731) --------- ---------- Total liabilities and stockholders' deficit ....................... $ 208,095 $ 208,341 ========= ==========
See Notes to Condensed Consolidated Financial Statements. Note: The balance sheet at December 31, 2000 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. 3 APCOA/STANDARD PARKING, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, unaudited)
Three Months Ended Nine Months Ended -------------------------------------- ---------------------------------------- September 30, 2001 September 30, 2000 September 30, 2001 September 30, 2000 ------------------ ------------------ ------------------ ------------------ Gross customer collections ........... $ 368,547 $ 402,444 $ 1,164,071 $ 1,154,537 =========== =========== =========== =========== Parking services revenue: Lease contracts ................. $ 37,469 $ 45,075 $ 120,557 $ 138,892 Management contracts ............ 21,321 18,042 62,470 49,383 ----------- ----------- ----------- ----------- 58,790 63,117 183,027 188,275 Cost of parking services: Lease contracts ................. 33,832 39,001 108,760 121,852 Management contracts ............ 11,784 8,979 32,628 21,747 ----------- ----------- ----------- ----------- 45,616 47,980 141,388 143,599 ----------- ----------- ----------- ----------- Gross profit ......................... 13,174 15,137 41,639 44,676 General and administrative expenses .. 6,153 8,734 22,769 26,996 Other special charges ................ 464 1,219 464 1,437 Depreciation and amortization ........ 2,857 2,911 8,471 8,127 ----------- ----------- ----------- ----------- Operating income ..................... 3,700 2,273 9,935 8,116 Interest expense (income): Interest expense ................ 4,505 4,518 13,846 13,411 Interest income ................. (243) (213) (676) (562) ----------- ----------- ----------- ----------- 4,262 4,305 13,170 12,849 ----------- ----------- ----------- ----------- Bad debt provision related to non-operating receivable ........... 4,805 -- 4,805 -- Loss before minority interest and income taxes ....................... (5,367) (2,032) (8,040) (4,733) Minority interest .................... 48 155 173 314 Income tax expense ................... 113 124 308 374 ----------- ----------- ----------- ----------- Net loss ............................. (5,528) (2,311) (8,521) (5,421) Preferred stock dividends ............ 1,610 1,443 4,700 4,213 Increase in fair value of common stock subject to put/call rights ........ -- -- 1,951 -- ----------- ----------- ----------- ----------- Net loss attributable to common stockholders ...................... $ (7,138) $ (3,754) $ (15,172) $ (9,634) =========== =========== =========== ===========
See Notes to Condensed Consolidated Financial Statements. 4 APCOA/STANDARD PARKING, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, unaudited)
Nine Months Ended ------------------------------------------ September 30, 2001 September 30, 2000 ------------------ ------------------ Operating activities: Net loss .................................................. $ (8,521) $ (5,421) Adjustments to reconcile net loss to net cash used in operations: Depreciation and amortization ........................... 8,471 8,127 Change in operating assets and liabilities, net of acquisitions .......................................... (2,119) (6,492) --------- --------- Net cash used in operating activities ..................... (2,169) (3,786) Investing activities: Purchase of leaseholds and equipment ...................... (1,058) (3,813) Purchase of leaseholds and equipment by joint ventures .... (8) (169) --------- --------- Net cash used in investing activities ..................... (1,066) (3,982) Financing activities: Proceeds from long-term borrowings ........................ 11,250 11,900 Payments on long-term borrowings .......................... (1,025) (455) Payments of debt issuance costs ........................... (329) - Payments on joint venture borrowings ...................... (544) (596) --------- --------- Net cash provided by financing activities ................. 9,352 10,849 Effect of exchange rate on cash and cash equivalents ...... (376) (932) --------- --------- Increase in cash and cash equivalents ..................... 5,741 2,149 Cash and cash equivalents at beginning of period .......... 3,539 5,215 --------- --------- Cash and cash equivalents at end of period ................ $ 9,280 $ 7,364 ========= ========= Supplemental disclosures: Cash paid during the period for: Interest ................................................ $ 15,866 $ 16,048 Taxes ................................................... 534 524
See Notes to Condensed Consolidated Financial Statements. 5 APCOA/STANDARD PARKING, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS September 30, 2001 (in thousands, unaudited) 1. Interim Financial Data The accompanying unaudited condensed consolidated financial statements of APCOA/Standard Parking, Inc. ("APCOA/Standard" or the "Company") have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting only of adjustments of a normal and recurring nature) considered necessary for a fair presentation of the financial position and results of operations have been included. Operating results for the nine-month period ended September 30, 2001 are not necessarily indicative of the results that might be expected for the fiscal year ending December 31, 2001. The financial statements presented in this Report should be read in conjunction with the consolidated financial statements and footnotes thereto included in APCOA/Standard's 2000 Form 10-K filed April 2, 2001. Certain reclassifications have been made to the 2000 financial information to conform to the 2001 presentation. 2. Other Special Charges Included in "Other special charges" in the accompanying condensed consolidated statements of operations are the following: Nine Months Ended ------------------------------------------ September 30, 2001 September 30, 2000 ------------------ ------------------ Other special charges ............. $ 464 $ 1,437 ============ ============ The other special charges for the period ending September 30, 2001 relate primarily to $0.2 million in prior period retroactive insurance premium increases, $0.1 million in severance costs, and $0.2 million in prior period outside consultant costs. The other special charges for the period ending September 30, 2000 relate primarily to $0.8 million in prior period retroactive insurance premium increases, $0.4 million in severance costs, and $0.2 million in prior period outside consultant costs. 3. Borrowing Arrangements APCOA/Standard's $140.0 million 9 1/4% Senior Subordinated Notes (the "Notes") were issued in September 1998 and are due in March 2008. The Notes are registered with the Securities and Exchange Commission. The Notes were exchanged for unregistered notes with substantially identical terms, which had been issued earlier in 1998 to finance acquisitions, retire certain existing indebtedness and for general working capital purposes. In March 1998, the Company entered into a $40.0 million revolving Senior Credit Facility (the "Facility") with a group of banks. Rates of interest on borrowings against the Facility are indexed to certain key variable rates. At September 30, 2001, borrowings under the Facility aggregated $38.2 million and there were letters of credit outstanding against this Facility of $1.8 million. The Notes and the Facility contain covenants that limit APCOA/Standard from incurring additional indebtedness and issuing preferred stock, restrict dividend payments, limit transactions with affiliates and restrict certain other transactions. Substantially all of APCOA/Standard's net assets are restricted under these provisions and covenants (See Note 4). 6 APCOA/STANDARD PARKING, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 4. Subsidiary Guarantors Substantially all of the Company's direct or indirect wholly owned domestic subsidiaries, other than inactive subsidiaries, fully, unconditionally, jointly and severally guarantee the Notes. Financial statements of the guarantor subsidiaries are not separately presented because, in the opinion of management, such financial statements are not material to investors. The non-guarantor subsidiaries include joint ventures, wholly owned subsidiaries of the Company organized under the laws of foreign jurisdictions, inactive subsidiaries and bankruptcy remote subsidiaries formed in connection with joint ventures, all of which are included in the consolidated financial statements. The following is summarized combined financial information for the Company, the guarantor subsidiaries of the Company and the non-guarantor subsidiaries of the Company:
Guarantor Non-Guarantor APCOA/Standard Subsidiaries Subsidiaries Eliminations Total -------------- ------------ ------------ ------------ ------ Balance Sheet Data: - ------------------ September 30, 2001 Cash and cash equivalents ............. $ 4,974 $ 3,235 $ 1,071 $ -- $ 9,280 Notes and accounts receivable ......... 30,310 9,590 5,704 -- 45,604 Current assets ........................ 36,378 12,937 6,872 -- 56,187 Leaseholds and equipment, net ......... 13,697 5,884 4,520 -- 24,101 Cost in excess of net assets acquired, net .................................. 23,243 88,955 3,269 -- 115,467 Investment in subsidiaries ............ 97,007 -- -- (97,007) -- Total assets .......................... 177,742 112,139 15,221 (97,007) 208,095 Accounts payable ...................... 22,052 9,465 2,048 -- 33,565 Current liabilities ................... 84,801 3,200 5,278 -- 93,279 Long-term borrowings, excluding current portion .............................. 142,029 -- 3,522 -- 145,551 Redeemable preferred stock ............ 59,676 -- -- -- 59,676 Common stock subject to put/call rights 8,255 -- -- -- 8,255 Total stockholders' (deficit) equity .. (128,029) 107,758 5,028 (97,007) (112,250) Total liabilities and stockholders' equity (deficit)...................... 177,742 112,139 15,221 (97,007) 208,095 December 31, 2000 Cash and cash equivalents ............. $ (593) $ 76 $ 4,056 $ -- $ 3,539 Notes and accounts receivable ......... 50,972 (7,529) 3,383 -- 46,826 Current assets ........................ 50,792 (6,264) 7,612 -- 52,140 Leaseholds and equipment, net ......... 15,693 7,395 5,404 -- 28,492 Cost in excess of net assets acquired, net .................................. 19,062 90,673 3,558 -- 113,293 Investment in subsidiaries ............ 93,211 -- -- (93,211) -- Total assets .......................... 187,446 96,818 17,288 (93,211) 208,341 Accounts payable ...................... 21,744 10,172 3,163 -- 35,079 Current liabilities ................... 46,328 8,938 8,815 -- 64,081 Long-term borrowings, excluding current portion .............................. 169,305 175 4,110 -- 173,590 Redeemable preferred stock ............ 54,976 -- -- -- 54,976 Common stock subject to put/call rights 6,304 -- -- -- 6,304 Total stockholders' (deficit) equity .. (94,942) 83,504 3,918 (93,211) (100,731) Total liabilities and stockholders' equity (deficit)...................... 187,446 96,818 17,288 (93,211) 208,341
7 APCOA/STANDARD PARKING, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Guarantor Non-Guarantor APCOA/Standard Subsidiaries Subsidiaries Eliminations Total -------------- ------------ ------------- ------------ ----- Income Statement Data: - ---------------------- Three Months Ended September 30, 2001 Parking revenue ......................... $ 34,400 $ 19,445 $ 4,945 $ - $ 58,790 Gross profit ............................ 8,160 4,314 700 - 13,174 Other special charges ................... 464 - - - 464 Depreciation and amortization ........... 1,324 1,205 328 - 2,857 Operating income (loss) ................. 5,697 (2,315) 318 - 3,700 Interest expense, net ................... 4,185 36 41 - 4,262 Equity in earnings of subsidiaries ...... (2,367) - - 2,367 - Net (loss) income ....................... (5,527) (2,246) (122) 2,367 (5,528) Three Months Ended September 30, 2000 Parking revenue ......................... $ 33,045 $ 22,930 $ 7,142 $ - $ 63,117 Gross profit ............................ 8,191 4,870 2,076 - 15,137 Other special charges ................... 1,219 - - - 1,219 Depreciation and amortization ........... 1,344 1,255 312 - 2,911 Operating income (loss) ................. 3,810 (3,168) 1,631 - 2,273 Interest expense, net ................... 4,191 (34) 148 - 4,305 Equity in earnings of subsidiaries ...... (1,928) - - 1,928 - Net (loss) income ....................... (2,311) (3,134) 1,206 1,928 (2,311) Nine Months Ended September 30, 2001 Parking revenue ......................... $ 102,407 $ 64,025 $ 16,595 $ - $ 183,027 Gross profit ............................ 26,641 11,910 3,088 - 41,639 Other special charges ................... 464 - - - 464 Depreciation and amortization ........... 3,785 3,731 955 - 8,471 Operating income (loss) ................. 19,355 (11,356) 1,936 - 9,935 Interest expense, net ................... 12,871 (43) 342 - 13,170 Equity in earnings of subsidiaries ...... (10,332) - - 10,332 - Net (loss) income ....................... (8,521) (11,313) 981 10,332 (8,521) Nine Months Ended September 30, 2000 Parking revenue ......................... $ 93,107 $ 69,875 $ 25,293 $ - $ 188,275 Gross profit ............................ 25,442 13,856 5,378 - 44,676 Other special charges ................... 1,437 - - - 1,437 Depreciation and amortization ........... 3,417 3,751 959 - 8,127 Operating income (loss) ................. 16,601 (12,461) 3,976 - 8,116 Interest expense, net ................... 12,461 (74) 462 - 12,849 Equity in earnings of subsidiaries ...... (9,551) - - 9,551 - Net (loss) income ....................... (5,421) (12,387) 2,836 9,551 (5,421)
8 APCOA/STANDARD PARKING, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Guarantor Non-Guarantor APCOA/Standard Subsidiaries Subsidiaries Eliminations Total -------------- ------------ ------------- ------------ ----- Statement of Cash Flow Data: - ---------------------------- Nine Months Ended September 30, 2001 Net cash (used in) provided by operating $ (2,397) $ 3,205 $ (2,977) $ -- $ (2,169) activities ................................. Investing activities: Purchase of leaseholds and equipment ..... (1,012) (46) -- -- (1,058) Purchase of leaseholds and equipment by joint ventures ....................... -- -- (8) -- (8) -------- -------- -------- ---------- -------- Net cash used in investing activities ....... (1,012) (46) (8) -- (1,066) Financing activities: Proceeds from long-term borrowings ....... 11,250 -- -- -- 11,250 Payments on long-term borrowings ......... (1,025) -- -- -- (1,025) Payments of debt issuance costs .......... (329) -- -- -- (329) Payments on joint venture borrowings ..... (544) -- -- -- (544) -------- -------- -------- ---------- -------- Net cash provided by financing activities 9,352 -- -- -- 9,352 Effect of exchange rate changes ............. (376) -- -- -- (376) Nine Months Ended September 30, 2000 Net cash (used in) provided by operating $ (5,827) $ 449 $ 1,592 $ -- $ (3,786) activities ................................ Investing activities: Purchase of leaseholds and equipment ..... (3,248) (565) -- -- (3,813) Purchase of leaseholds and equipment by joint ventures .............................. -- -- (169) -- (169) -------- -------- -------- ---------- -------- Net cash used in investing activities ....... (3,248) (565) (169) -- (3,982) Financing activities: Proceeds from long-term borrowings ....... 11,900 -- -- -- 11,900 Payments on long-term borrowings ......... (455) -- -- -- (455) Payments on joint venture borrowings ..... (596) -- -- -- (596) -------- -------- -------- ---------- -------- Net cash provided by financing activities ... 10,849 -- -- -- 10,849 Effect of exchange rate changes ............. (932) -- -- -- (932)
5. Recently Issued Accounting Pronouncement In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard ("SFAS") No. 142, Goodwill and Other Intangible Assets. SFAS No. 142 no longer permits the amortization of goodwill and indefinite-lived intangible assets. Instead, these assets must be reviewed annually (or more frequently under certain conditions) for impairment in accordance with this statement. This impairment test uses a fair value approach rather than the undiscounted cash flows approach previously required by SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of. Intangible assets that do not have indefinite lives will continue to be amortized over their useful lives and reviewed for impairment in accordance with SFAS No. 121. We are required to adopt SFAS No. 142 effective January 1, 2002. The Company is currently evaluating its intangible assets in relation to the provisions of SFAS No. 142 to determine the impact, if any, the adoption of SFAS No. 142 will have on its results of operations or financial position. 6. Common Stock Subject to Put/Call Rights SP Associates sent APCOA/Standard a notice dated September 28, 2001 exercising its right under a stockholders agreement to require APCOA/Standard Parking to repurchase 2.5 shares for an aggregate amount of $4.1 million. On October 18, 2001, the Carol R. Warshauer GST Exempt Trust and Waverly Partners L.P., each an entity associated with Myron C. Warshauer, our former chief executive officer, sent notices exercising their respective rights to require APCOA/Standard to repurchase an aggregate of 2.5 shares for an aggregate amount of $4.1 million. The Company's obligation to repurchase these shares will accrete at 11.75% per year until discharged. Pursuant to the terms of the stockholders agreement, the Company will not make any payment for these shares as such payment is currently prohibited by the terms of its existing Facility and restricted by the 9 1/4% notes and other debt instruments. If the Company does purchase the common stock that has been put to it, then AP Holdings, Inc. ("Holdings") will be Apcoa/Standard's sole shareholder. 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations General APCOA/Standard Parking, Inc. ("APCOA/Standard" or the "Company") operates in a single reportable segment operating parking facilities under two types of arrangements: management contracts and leases. Under a management contract, APCOA/Standard typically receives a base monthly fee for managing the property and may also receive a small incentive bonus based on the achievement of facility revenues above a base amount, among other factors. In some instances, APCOA/Standard also receives certain fees for ancillary services. Typically, all of the underlying revenues, expenses and capital expenditures under a management contract flow through to the property owner, rather than to APCOA/Standard. Under lease arrangements, APCOA/Standard generally pays to the property owner either a fixed annual rental, a percentage of gross customer collections or a combination thereof. APCOA/Standard collects all revenues under lease arrangements and is responsible for most operating expenses, but it is typically not responsible for major maintenance or capital expenditures. As of September 30, 2001, APCOA/Standard operated approximately 82% of its 1,957 parking facilities under management contracts and approximately 18% under leases. Gross customer collections. Gross customer collections consist of gross receipts collected at all leased and managed properties, including unconsolidated affiliates. Parking services revenue--lease contracts. Parking services revenues related to lease contracts consist of all revenues received at a leased facility. Parking services revenue--management contracts. Management contract revenue consists of management fees, including both fixed and revenue-based fees and fees for ancillary services such as accounting, equipment leasing, consulting, insurance and other value-added services with respect to managed locations. Management contract revenue excludes gross customer collections at such locations. Management contracts generally provide APCOA/Standard a management fee regardless of the operating performance of the underlying facility. Cost of parking services--lease contracts. Cost of parking services under lease arrangements consists of contractual rental fees paid to the facility owner and all operating expenses incurred in connection with operating the leased facility. Contractual fees paid to the facility owner are based on either a fixed contractual amount or a percentage of gross revenue or a combination thereof. Generally, under a lease arrangement APCOA/Standard is not responsible for major capital expenditures or property taxes. Cost of parking services--management contracts. Cost of parking services under a management contract is generally passed through to the facility owner. As a result, these costs are not included in the Company's results of operations. Several APCOA/Standard contracts, which are referred to as reverse management contracts, however, require APCOA/Standard to pay for certain costs that are offset by larger management fees. General and administrative expenses. General and administrative expenses primarily include salaries, wages, travel and office related expenses for the headquarters, field office and supervisory employees. Summary of Operating Facilities The following table reflects the Company's facilities on the dates indicated:
September 30, 2001 December 31, 2000 September 30, 2000 ------------------ ----------------- ------------------ Managed facilities .... 1,603 1,570 1,506 Leased facilities ..... 354 364 376 ----- ----- ----- Total facilities .... 1,957 1,934 1,882 ===== ===== =====
The Company's strategy is to add locations primarily in core cities where a concentration of locations improves customer service levels and operating margins. In general, contracts added as set forth in the table above followed this strategy. 10 Results of Operations In analyzing the gross margins of APCOA/Standard, it should be noted that the cost of parking services for parking facilities under management contracts is generally paid by the clients. Several management contracts, however, which are referred to as reverse management contracts, require us to pay for certain costs that are offset by larger management fees. Margins for lease contracts vary significantly not only due to operating performance, but also variability of parking rates in different cities and widely varying space utilization by parking facility type and location. The attacks that occurred on September 11th had an immediate effect on our business at all of the 76 airports that we operate and, to a lesser extent, at isolated urban facilities near governmental institutions. Although business at airports had been declining prior to the September 11th attacks, an immediate significant decrease in airport revenues occurred following those events. Parking revenue at our airports declined 45.3% during the period of September 16-30, 2001, compared to the same period of 2000. This percentage improved during each of the two bi-weekly periods thereafter. Revenues at our airports for the period of October 16-31, 2001 were 23.3% lower than the same period last year, indicating potential recovery from the post-September 11th drop. We do not know what the lasting effect of the September 11th attacks will be. However, the airport parking and transportation market only represents approximately 24% of the Company's gross profit. Most of the urban business, with the exception of some hotels, has returned to pre-September 11th activity. The following should be read in conjunction with the Condensed Consolidated Financial Statements. Three Months ended September 30, 2001 Compared to Three Months ended September 30, 2000 Gross customer collections. Gross customer collections decreased $33.9 million, or 8.4%, to $368.5 million in the third quarter of 2001, compared to $402.4 million in the third quarter of 2000. This decrease is attributable to the attacks of September 11th, which impacted all airport operations, special event venues and hotels and the loss of one large airport contract in the fourth quarter of 2000. Parking services revenue--lease contracts. Lease contract revenue decreased $7.6 million, or 16.9%, to $37.5 million in the third quarter of 2001, compared to $45.1 million in the third quarter of 2000. This decrease resulted from the net reduction of 22 leases through contract expirations, conversions to management contracts and the attacks of September 11th. Parking services revenue--management contracts. Management contract revenue increased $3.3 million, or 18.3%, to $21.3 million in the third quarter of 2001, compared to $18.0 million in the third quarter of 2000. This increase resulted from the net increase of 97 management contracts through internal growth and conversions from lease contracts. Cost of parking services--lease contracts. Cost of parking services for leases decreased $5.2 million, or 13.3%, to $33.8 million for the third quarter of 2001, compared to $39.0 million in the third quarter of 2000. This decrease resulted from the reduction of 22 leases through terminations and conversions to management contracts. Gross margin for lease contracts declined to 9.7% for the third quarter of 2001 compared to 13.5% for the third quarter of 2000. This decrease resulted from increased rents on lease contract renewals, the lower airport travel volumes and the attacks of September 11th. Cost of parking services--management contracts. Cost of parking services for management contracts increased $2.8 million, or 31.1%, to $11.8 million for the third quarter of 2001, compared to $9.0 million in the third quarter of 2000. This increase resulted from the addition of a net total of 97 management contracts through internal growth and conversions from lease contracts. Gross margin for management contracts declined to 44.7% in the third quarter of 2001 compared to 50.2% for the third quarter of 2000. Most management contracts have no cost of parking services related to them, as all costs are reimbursable to the Company. However, several management contracts, which are referred to as reverse management contracts, require the Company to pay for certain costs that are offset by larger management fees. The increase in cost of parking for management contracts was related to the addition of several contracts of this type and the negative economic impact affecting airport travel volumes on these types of contracts. General and administrative expenses. General and administrative expenses decreased $2.5 million, or 28.7%, to $6.2 million for the third quarter of 2001, as compared to $8.7 million for the third quarter of 2000. This decrease resulted from cost savings, staff reductions and operating efficiencies implemented in earlier periods. In addition, approximately $0.8 million in favorable year to date accrual adjustments were recorded in the third quarter of 2001 that related to prior quarters. Other special charges. The Company recorded $0.5 million of other special charges in the third quarter of 2001, as compared to $1.2 million in the third quarter of 2000. The 2001 special charges relate primarily to $0.2 million in prior period retroactive insurance premium increases, $0.1 million in severance costs and $0.2 million in prior period outside consultant costs. The 2000 special charges related primarily to $0.8 million in prior period retroactive insurance premium increases, $0.2 million in severance costs and $0.2 million in prior period outside consultant costs. Non-operating income (expense). The Company recorded a $4.8 million bad debt provision related to non-operating receivables in the third quarter of 2001 as compared to no charges in the third quarter of 2000. The 2001 bad debt provision for non-operating receivables relate to advances to and deposits with affiliates that had previously been reclassified from a long-term asset to stockholders' deficit. This provision was made due to uncertainty regarding the ability of the affiliates to repay such amounts. During the fourth quarter, the Company intends to enter into a two step, non-cash transaction pursuant to which it will redeem approximately $8.0 million of its preferred stock held by Holdings, the proceeds from which Holdings will immediately use to repay the balance of approximately $8.0 million of advances and deposits due to the Company in full. 11 Nine Months ended September 30, 2001 Compared to Nine Months ended September 30, 2000 Gross customer collections. Gross customer collections increased $9.6 million, or 0.8%, to $1,164.1 million in the first nine months of 2001, compared to $1,154.5 million in the first nine months of 2000. This increase is attributable to the net addition of 75 locations year to date. Parking services--lease contracts. Lease contract revenue decreased $18.3 million, or 13.2%, to $120.6 million in the first nine months of 2001, compared to $138.9 million in the first nine months of 2000. This decrease resulted from the net reduction of 10 leases through contract expirations, conversions to management contracts and the conversion of one large airport property from a lease contract to a management contract. Parking services revenue--management contracts. Management contract revenue increased $13.1 million, or 26.5%, to $62.5 million in the first nine months of 2001, compared to $49.4 million in the first nine months of 2000. This increase resulted from the net increase of 33 management contracts through internal growth and conversions from lease contracts. Cost of parking services--lease contracts. Cost of parking services for lease contracts decreased $13.1 million, or 10.7%, to $108.8 million in the first nine months of 2001, compared to $121.9 million in the first nine months of 2000. This decrease resulted from the reduction of 10 leases through contract expirations and conversions to management contracts. Gross margin for leases decreased to 9.8% for the first nine months of 2001 compared to 12.3% for the first nine months of 2000. This decrease resulted from increased rents on lease contract renewals, lower airport travel volumes, the attacks of September 11th, major road construction activity adjacent to several Chicago properties that the Company operates and additional snow removal costs in the first quarter of the year. Cost of parking services--management contracts. Cost of parking services for management contracts increased $10.8 million, or 49.5%, to $32.6 million in the first nine months of 2001, compared to $21.8 million in the first nine months of 2000. Gross margin for management contracts declined to 47.8% in the first nine months of 2001 compared to 56.0% in the first nine months of 2000. Most management contracts have no cost of parking services related to them, as all costs are reimbursable to the Company. However, several contracts, which are referred to as reverse management contracts, require the Company to pay for certain costs that are offset by larger management fees. The increase in cost of parking for management contracts was related to the addition of several contracts of this type and the negative economic impact affecting airport travel volumes on these types of contracts. General and administrative expenses. General and administrative expenses decreased $4.2 million, or 15.6%, to $22.8 million for the first nine months of 2001, compared to $27.0 million in the first nine months of 2000. This decrease resulted from cost savings, staff reductions and operating efficiencies implemented in prior periods. Other special charges. The Company recorded $0.5 million of other special charges in the first nine months of 2001, compared to $1.4 million in the first nine months of 2000. The 2001 special charges relate primarily to $0.2 million in prior period retroactive insurance premium increases, $0.1 million in severance costs and $0.2 million in prior period outside consultant costs. The 2000 special charges related primarily to $0.8 million in prior period retroactive insurance premium increases, $0.4 million in severance costs and $0.2 million in prior period outside consultant costs. Non-operating income (expense). The Company recorded a $4.8 million bad debt provision related to non-operating receivables in the first nine months of 2001 as compared to no charges in the first nine months of 2000. The 2001 bad debt provision for non-operating receivables relate to advances to and deposits with affiliates that had previously been reclassified from a long-term asset to stockholders' deficit. This provision was made due to uncertainty regarding the ability of the affiliates to repay such amounts. During the fourth quarter, the Company intends to enter into a two step, non-cash transaction pursuant to which it will redeem approximately $8.0 million of its preferred stock held by Holdings, the proceeds from which Holdings will immediately use to repay the balance of approximately $8.0 million of advances and deposits due to the Company in full. 12 Liquidity and Capital Resources As a result of day-to-day activity at the parking locations, APCOA/Standard collects significant amounts of cash. Lease contract revenue is generally deposited into local APCOA/Standard bank accounts, with a portion remitted to our clients in the form of rental payments according to the terms of the leases. Under management contracts, some clients require APCOA/Standard to deposit the daily receipts into a local APCOA/Standard bank account, with the cash in excess of our operating expenses and management fees remitted to the clients at negotiated intervals. Other clients require us to deposit the daily receipts into client accounts and the clients then reimburse the Company for operating expenses and pay the management fee subsequent to month-end. Some clients require a segregated account for the receipts and disbursements of the locations. Gross daily collections are collected by APCOA/Standard and deposited into banks in one of three methods, which impact our investment in working capital: (i) locations with revenues deposited into APCOA/Standard bank accounts reduce our investment in working capital, (ii) locations that have segregated accounts generally require no investment in working capital and (iii) accounts where the revenues are deposited into the clients' accounts require our investment in working capital. APCOA/Standard's average investment in working capital depends on our contract mix. For example, an increase in contracts that require all cash deposited in APCOA/Standard bank accounts reduces our investment in working capital and improves our liquidity. During the period of January 1, 2001 to September 30, 2001, a decrease in these types of contracts resulted in a loss of liquidity to us of approximately $1.0 million. APCOA/Standard's liquidity also fluctuates on an intra-month and intra-year basis depending on the contract mix and timing of significant cash payments such as our semi-annual interest payments. Additionally, our ability to utilize cash deposited into our local accounts is dependent upon the movement of that cash into our corporate account. For all these reasons, we from time to time carry significant cash balances, while at the same time utilizing our Facility. Our liquidity will be impacted as a result of our new surety provider's requirement that we collaterize a greater percentage of our performance bonds with letters of credit. If we are unable to provide sufficient collateral, our surety will not issue performance bonds to support our obligations under certain contracts. As of September 30, 2001, the Company had obtained a letter of credit which was provided as collateral to our old surety provider to support our existing performance bonds. We are presently transferring our performance bond portfolio to a new surety. On November 8, 2001, the Company obtained a $1.0 million letter of credit to partially collateralize a new surety program. The new program will require an increase in supporting letters of credit from $1.0 million to $4.0 million by April 2002. In addition, the Company will be required to maintain the existing $1.5 million collateral with the old surety provider until the performance bonds expire or are transferred to the new surety. The Company had cash and cash equivalents of $9.3 million at September 30, 2001 compared to $3.5 million at December 31, 2000. Nine Months ended September 30, 2001 Compared to Nine Months ended September 30, 2000 Net cash used in operating activities totaled $2.2 million for the first nine months of 2001 compared to cash used of $3.8 million for the first nine months of 2000. Cash used during 2001 included a $1.2 million decrease in accounts receivable, a $1.5 million decrease in accounts payable, a $4.3 million decrease in other liabilities due primarily to the $13.0 million of interest payments on the Notes, that was partially offset by a $8.7 million increase in deferred compensation, insurance and other accruals and a $2.4 million increase in prepaid and other assets. Cash used during the first nine months of 2000 included a $13.0 million interest payment on the Notes, $3.0 million in other interest payments that were offset by increases in accounts payable and other liabilities of $6.4 million and a decrease in other assets of $1.2 million. Cash used in investing activities totaled $1.1 million for the first nine months of 2001 compared to $4.0 million for the first nine months of 2000. Cash used in investing activities in the first nine months of 2001 and the first nine months of 2000 resulted from capital purchases to secure and/or extend leased facilities and investments in management information system enhancements. Cash generated from financing activities totaled $9.4 million for the first nine months of 2001, compared to $10.8 million for the first nine months of 2000. The 2001 activity included $11.3 million in borrowings from the Facility, offset by repayments on long-term and joint venture borrowings of $1.6 million, as well as payments of debt issuance costs of $0.3 million. The 2000 activity included $11.9 million in borrowings from the Facility, offset by repayments on long-term and joint venture borrowings of $1.1 million. 13 Other Liquidity and Capital Resources Information The Company's Facility provides cash borrowings up to $40.0 million with sublimits for letters of credit up to $10.0 million, at variable rates based, at the Company's option, either on LIBOR, the overnight federal funds rate, or the bank's base rate. The Company utilizes the Facility to provide readily- accessible cash for working capital purposes. The Facility includes covenants that limit the Company from incurring additional indebtedness, issuing preferred stock or paying dividends, and contains certain other restrictions. At September 30, 2001, the Company had $1.8 million of letters of credit outstanding under the Facility and borrowings against the Facility aggregated $38.2 million. On November 12, 2001, the Company had $2.8 million of letters of credit outstanding under the Facility and borrowings against the Facility aggregated $32.4 million. The Facility was amended on March 30, 2000, with the principal changes to the agreement providing for revisions to interest rates charged on borrowings and certain financial covenants. The Facility was amended on May 12, 2000, with the principal change to the agreement relating to the definition of a change in control. The Facility was amended on November 14, 2000, with the principal changes to the agreement providing for revisions to interest rates charged on borrowings and certain financial covenants. The Facility was amended on March 30, 2001, with the principal changes to the agreement providing for revisions to interest rates charged on borrowings, certain financial covenants, a change to restore the original borrowing limits and a change in the expiration date from March 30, 2004 to July 1, 2002. The Facility was amended as of September 30, 2001, with the principal changes to the agreement providing for revision to certain financial covenants. The Facility was reclassified to current liabilities effective July 1, 2001. As of September 30, 2001, the Company was in compliance with the covenants contained in the Facility or has obtained the necessary waivers on or before November 14, 2001. The Company's ability to meet its anticipated future requirements for working capital, capital expenditures, scheduled payments of interest and principal on its indebtedness depends on the Company's future performance, which, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors beyonds its control. Based upon the current level of operations and anticipated growth, the Company believes that, notwithstanding the borrowings available under its Facility at September 30, 2001, its cash flow and available liquidity will be adequate to meet the Company's anticipated requirements up to the expiration of the Facility. There can be no assurance, however, that the Company's business will generate sufficient cash or that future borrowings will be available in an amount sufficient to enable the Company to meet its future requirements, or that any refinancing of existing indebtedness (including the Facility) would be available on commercially reasonable terms, or at all. If the Company identifies investment opportunities requiring cash in excess of the Company's cash flows and existing cash, the Company may borrow under the Facility to the extent available. Special Cautionary Notice Regarding Forward-Looking Statements In addition to historical information, this Quarterly Report on Form 10-Q contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as in this Quarterly Report generally. You should carefully review the risks described in this Quarterly Report as well as the risks described in other documents filed by the Company from time to time with the Securities and Exchange Commission. In addition, when used in this Quarterly Report, the words "anticipates," "plans," "believes," "estimates," and "expects" and similar expressions are generally intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by the Company or these forward-looking statements. The Company undertakes no obligation to revise these forward-looking statements to reflect any future events or circumstances. Cautionary Statements The Company continues to be subject to certain factors that could cause the Company's results to differ materially from expected and historical results. You are advised to consult any additional disclosures by the Company in its filings with the Securities and Exchange Commission, including registration statements, quarterly reports on Form 10-Q and current reports on Form 8-K. Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company's primary market risk exposure consists of risk related to changes in interest rates. Historically, the Company has not used derivative financial instruments for speculative or trading purposes. 14 The Company entered into a $40.0 million revolving variable rate Senior Credit Facility (see Note 3 of the Notes to the Condensed Consolidated Financial Statements). Interest expense on such borrowing is sensitive to changes in the market rate of interest. If the Company were to borrow the entire $40.0 million available under the Facility, a 1% increase in the average market rate would result in an increase in the Company's annual interest expense of $0.4 million. This amount is determined by considering the impact of the hypothetical interest rates on the Company's borrowing cost, but does not consider the effects of the reduced level of overall economic activity that could exist in such an environment. Due to the uncertainty of the specific changes and their possible effects, the foregoing sensitivity analysis assumes no changes in the Company's financial structure. 15 PART II OTHER INFORMATION Item 1. Legal Proceedings In the normal course of business, the Company is involved in disputes, generally regarding the terms of lease agreements. In the opinion of management, the outcome of these disputes and litigation will not have a material adverse effect on the consolidated financial position or operating results of the Company. Item 2. Changes in Securities and Use of Proceeds None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None 16 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits Exhibit Number Description - ------- ----------- 4.12 Sixth Amendment to the Senior Credit Facility dated September 30, 2001 by and among the Company, the Lenders and Bank One, N.A., as agent for the Lenders. (b) Reports on Form 8-K None 17 ` SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. APCOA/Standard Parking, Inc. (Registrant) November 14, 2001 /s/ JAMES A. WILHELM By: ___________________________________________________ James A. Wilhelm Director, President and Chief Executive Officer November 14, 2001 /s/ G. MARC BAUMANN By: ___________________________________________________ G. Marc Baumann Executive Vice President, Chief Financial Officer and Treasurer 18 INDEX TO EXHIBITS Exhibit Number Description - ------ ----------- 4.12 Sixth Amendment to the Senior Credit Facility dated September 30, 2001 by and among the Company, the Lenders and Bank One, N.A., as agent for the Lenders. 19 EX-4.12 3 dex412.txt 6TH AMENDMENT TO TEHE SENIOR CREDIT FACILITY Exhibit 4.12 SIXTH AMENDMENT TO CREDIT AGREEMENT and CONSENT THIS SIXTH AMENDMENT TO CREDIT AGREEMENT and CONSENT (the "Amendment") is dated as of September 30, 2001 by and among APCOA/STANDARD PARKING, INC., a Delaware corporation (the "Company"), the financial institutions listed on the signature pages hereof (the "Lenders"), and BANK ONE, NA (having its principal place of business in Chicago, Illinois), in its individual capacity as a Lender and in its capacity as contractual representative (the "Agent") under that certain Credit Agreement among the Company, the lenders party thereto and the Agent dated as of March 30, 1998 (as clarified by letter agreement dated March 30, 1999 and by letter agreement dated August 23, 2000, and as amended by a First Amendment to Credit Agreement dated as of November 12, 1999, a Second Amendment to Credit Agreement dated as of March 30, 2000, a Third Amendment to Credit Agreement dated as of May 12, 2000, a Fourth Amendment to Credit Agreement dated as of November 14, 2000 and a Fifth Amendment to Credit Agreement dated as of March 30, 2001, the "Credit Agreement"). Defined terms used herein and not otherwise defined herein shall have the meaning given to them in the Credit Agreement. WITNESSETH WHEREAS, the Company, the Lenders and the Agent are parties to the Credit Agreement; WHEREAS, the Company has requested that the Required Lenders agree to certain amendments to the Credit Agreement and to consent to the "Specified Transaction" (as defined in Section 2 below); WHEREAS, the Company, the Lenders and the Agent have agreed to enter into this Amendment on the terms and conditions set forth herein, to amend the Credit Agreement and to consent to the Specified Transaction in the manner hereinafter set forth; NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto have agreed to the following amendment to and consent under the Credit Agreement: 1. Amendments to the Credit Agreement. Effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 3 below, the Credit Agreement is hereby amended as follows: (a) The Definition of "Adjusted EBITDA" in Section 1.1 of the Credit Agreement shall be amended to renumber the existing clause (I)(xii) as clause (I)(xiii) and to insert the following new clause (I)(xii) immediately prior thereto: (xii) solely with respect to the fiscal quarter ended September 30, 2001, restructuring and special charges, (b) Section 5.2(a) of the Credit Agreement is hereby deleted in its entirety and the following new Sections 5.2(a) is substituted therefor: (a) Adjusted Total Debt to Adjusted EBITDA Ratio. Permit or suffer the Adjusted Total Debt to Adjusted EBITDA Ratio to be greater than (i) 6.95 to 1.0 at any time from and including the Effective Date to and including September 29, 1999, (ii) 6.75 to 1.0 at any time from and including September 30, 1999 to and including December 31, 1999, (iii) 8.15 to 1.0 at any time from and including January 1, 2000 to and including September 30, 2000, (iv) 7.99 to 1.0 at any time from and including October 1, 2000 to and including December 31, 2000, (v) 8.23 to 1.0 at any time from and including January 1, 2001 to and including March 31, 2001, (vi) 8.07 to 1.0 at any time from and including April 1, 2001 to and including June 30, 2001, (vii) 7.77 to 1.0 at any time from and including July 1, 2001 to and including September 30, 2001, (viii) 6.54 to 1.0 at any time from and including October 1, 2001 to and including December 31, 2001, (v) 6.74 to 1.0 at any time from and including January 1, 2002 to and including March 31, 2002 and (vi) 6.42 to 1.0 at any time from and including April 1, 2002 to and including June 30, 2002. 2. Consent. Notwithstanding the provisions of Section 5.2(i) of the Credit Agreement to the contrary, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 3 below, the Agent and the Lenders hereby agree to permit the Company to eliminate the $8,000,000 intercompany account balance presently owing by the Parent in favor of the Company pursuant to a two-step, non-cash transaction consummated during the fiscal quarter ending December 31, 2001 whereby (a) the Company shall pay the Parent $8,000,000 to redeem $8,000,000 of its Preferred Stock presently owned by the Parent and (b) the Parent shall use the proceeds of the payment received under clause (a) to contemporaneously pay the Company $8,000,000 in full satisfaction of the aforementioned intercompany account balance (collectively, the "Specified Transaction"); provided, however, that both before and upon consummation of the Specified Transaction, (i) no Default or Unmatured Default shall have occurred or be continuing and (ii) the representations and warranties contained the Loan Documents shall be true and correct. 3. Conditions of Effectiveness. The effectiveness of this Amendment is subject to the condition precedent that the Agent shall have received: (a) duly executed originals of this Amendment from each of the Company, the Required Lenders and the Agent; (b) duly executed originals of a Reaffirmation in the form of Exhibit A attached hereto from the Guarantors; and 2 (c) an amendment fee of $100,000, payable to the Agent for the pro rata benefit of the Lenders based upon their respective Commitments. 4. Representations and Warranties of the Company. The Company hereby represents and warrants as follows: (a) The Company has the corporate power and authority to execute and deliver this Amendment and the officers of the Company executing this Amendment have been duly authorized to execute and deliver the same and bind the Company with respect to the provisions hereof. (b) This Amendment and the Credit Agreement as previously executed and amended and as amended hereby, constitute legal, valid and binding obligations of the Company and are enforceable against the Company in accordance with their terms (except as enforceability may be limited by bankruptcy, insolvency, or similar laws affecting the enforcement of creditors' rights generally). (c) Upon the effectiveness of this Amendment and after giving effect hereto, (i) the Company hereby reaffirms all covenants, representations and warranties made in the Credit Agreement as previously amended and as amended hereby, and agrees that all such covenants, representations and warranties (other than covenants, representations and warranties that are expressly made as of a specific date) shall be deemed to have been remade as of the effective date of this Amendment and (ii) no Event of Default or Unmatured Event has occurred and is continuing. 5. Reference to and Effect on the Credit Agreement. (a) Upon the effectiveness of Section 1 hereof, on and after the date hereof, each reference in the Credit Agreement or in any other Loan Document (including any reference therein to "this Credit Agreement," "this Agreement," "hereunder," "hereof," "herein" or words of like import referring thereto) shall mean and be a reference to the Credit Agreement as amended hereby. (b) Except as specifically amended or consented to above, the Credit Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed. The amendments set forth herein shall be limited precisely as provided for herein, and shall not be deemed to be a waiver of, amendment of, consent to or modification of any other term, provision or Event of Default or Unmatured Event of or under the Credit Agreement or of any term or provision of any other Credit Document or of any transaction or further or future action on the part of the Company which would require the consent of the Agent or any Lender under the Credit Agreement. (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 the Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith. 3 6. Costs and Expenses. The Borrower agrees to pay all reasonable costs, fees and out-of-pocket expenses (including attorneys' fees and expenses of Sidley Austin Brown & Wood, special counsel to the Agent) incurred by the Agent in connection with the preparation, arrangement, execution and enforcement of this Amendment. 7. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ., BUT OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS) OF THE STATE OF ILLINOIS. 8. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose. 9. Counterparts. This Amendment may be executed by one or more of the parties to the Amendment on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 4 IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written. APCOA/STANDARD PARKING, INC., as the Company By: /s/ G. Marc Baumann --------------------------------- Name: G. Marc Baumann Title: Executive Vice President Chief Financial Officer and Treasurer BANK ONE, NA (Main Office Chicago) (formerly known as THE FIRST NATIONAL BANK OF CHICAGO), as Agent and as a Lender By: /s/ Thomas T. Bower --------------------------------- Name: Thomas T. Bower Title: Senior Vice President LASALLE BANK NATIONAL ASSOCIATION (formerly known as LaSalle National Bank), as a Lender By: /s/ Sean P. Silver --------------------------------- Name: Sean P. Silver Title: Vice President Signature Page to Sixth Amendment to APCOA/STANDARD PARKING, INC. Credit Agreement and Consent EXHIBIT A REAFFIRMATION Each of the undersigned hereby acknowledges receipt of a copy of the foregoing Sixth Amendment to Credit Agreement and Consent dated as of September 30, 2001 (the "Amendment") by and among APCOA/STANDARD PARKING, INC., a Delaware corporation (the "Company"), the financial institutions from time to time party thereto (the "Lenders"), and Bank One, NA, in its individual capacity as a Lender and in its capacity as contractual representative (the "Agent"), which Amendment further amends that certain Credit Agreement among the Company, the lenders party thereto and the Agent dated as of March 30, 1998 (as clarified by letter agreement dated March 30, 1999 and by letter agreement dated August 23, 2000, and as amended by a First Amendment to Credit Agreement dated as of November 12, 1999, a Second Amendment to Credit Agreement dated as of March 30, 2000, a Third Amendment to Credit Agreement dated as of May 12, 2000, a Fourth Amendment to Credit Agreement dated as of November 14, 2000 and a Fifth Amendment to Credit Agreement dated as of March 30, 2001, the "Credit Agreement"). Capitalized terms used in this Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement. Without in any way establishing a course of dealing by the Agent or any Lender, each of the undersigned reaffirms the terms and conditions of the Guaranty and any other Loan Document executed by it and acknowledges and agrees that such agreements and each and every such Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed. All references to the Credit Agreement contained in the above-referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment and as the same may from time to time hereafter be amended, modified or restated. REMAINDER OF PAGE INTENTIONALLY BLANK IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute this Reaffirmation as of the 30th day of September, 2001. A-1 Auto Park, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer AP Holdings, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Treasurer APCOA Capital Corporation By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Century Parking, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Events Parking Co., Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Treasurer Hawaii Parking Maintenance, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer SIGNATURE PAGE TO REAFFIRMATION (Sixth Amendment and Consent) Metropolitan Parking System, Inc. By: /s/ G. Marc Baumann ----------------------------------- G. Marc Baumann Treasurer S & S Parking, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Sentinel Parking Co. of Ohio, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Sentry Parking Corporation By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Standard Auto Park, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Treasurer Standard Parking Corporation By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Treasurer SIGNATURE PAGE TO REAFFIRMATION (Sixth Amendment and Consent) Standard Parking Corporation IL By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Treasurer Tower Parking, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer Virginia Parking Service, Inc. By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Vice President, Treasurer APCOA Bradley Parking Company, LLC By: APCOA/Standard Parking, Inc., its Sole Member By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Executive Vice President, Chief Financial Officer, Treasurer APCOA LaSalle Parking Company, L.L.C. By: APCOA/Standard Parking, Inc., its Manager By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Executive Vice President, Chief Financial Officer, Treasurer SIGNATURE PAGE TO REAFFIRMATION (Sixth Amendment and Consent) Executive Parking Industries, L.L.C. By: APCOA/Standard Parking, Inc., its Manager By: /s/ G. Marc Baumann ------------------------------------ G. Marc Baumann Executive Vice President, Chief Financial Officer, Treasurer SIGNATURE PAGE TO REAFFIRMATION (Sixth Amendment and Consent) -----END PRIVACY-ENHANCED MESSAGE-----