ATC Group Services makes announcement.

NEW YORK--(BUSINESS WIRE)--May 29, 1997--

ATC Group Services Inc. Announces the Issuance of $32,500,000 of

8.18% Seven Year Senior Secured Notes in a Private Placement Offering

and Execution of a $15,000,000 Bank Credit Facility Maturing in

November 1999 in Replacement of its Bridge Credit Facility

Morry F. Rubin, President and Chief Executive Officer of ATC Group Services Inc., (NASDAQ:ATCS) announced the issuance of $32,500,000 of 8.18% Seven Year Senior Secured Notes in a private placement offering. Concurrently, the Company executed a $15,000,000 credit agreement with the Chase Manhattan Bank and Atlantic Bank of New York maturing in November, 1999. The outstanding borrowings under the bridge loan of $21,350,000 as of May 29, 1997 were paid from the note proceeds.

The Senior Secured Notes are payable in five installments commencing May 31, 2000, with interest payable semi-annually at 8.18% commencing November 30, 1997. At the Company's discretion, interest on borrowings under the bank credit agreement accrues at LIBOR plus 1.75% or at 90% of the prime rate and is payable monthly.

The note and bank borrowings are collateralized by the Company's primary cash depository accounts, accounts receivable, work in process and intangible assets. The agreements also require compliance with certain financial and other covenants including a minimum working capital requirement, compliance with fixed charge and interest coverage ratios, and limitations on dividend payments.

The Company will use the net proceeds after repayment of the bridge loan for working capital, internal expansion and to provide funds for future acquisitions.

CONTACT: Company Contact

Morry F. Rubin

President & CEO 

[phone]