FIFTH AMENDMENT TO CREDIT AGREEMENT
This Fifth Amendment is made as of the 1st day of January,
1997 by and between FIELDS AIRCRAFT SPARES INCORPORATED, a California
corporation (the "Borrower"), and NORWEST BUSINESS CREDIT, INC., a Minnesota
corporation (the "Lender").
RECITALS
The Borrower and the Lender have entered into the Credit and
Security Agreement dated as of February 9, 1995 and amended by the First
Amendment to Credit Agreement dated November 21, 1995, by the Second Amendment
to Credit Agreement dated February 29, 1996, by the Third Amendment to the
Credit Agreement dated June 30, 1996 and by the Fourth Amendment dated August
16, 1996 (as amended, the "Credit Agreement").
The Borrower may request certain advances from the Lender from
time to time pursuant to the Credit Agreement, and the Lender may, in its
discretion, choose to make loans to the Borrower pursuant to the Credit
Agreement. The Lender may demand repayment of the loans at any time pursuant to
the terms of the Credit Agreement.
The loan advances under the Credit Agreement are evidenced by
the Borrower's demand promissory note dated as of February 9, 1995, in the
maximum principal amount of Ten Million Dollars ($10,000,000) and payable to the
order of the Lender (the "Note").
All indebtedness of the Borrower to the Lender is secured
pursuant to the terms of the Credit Agreement and all other Security Documents
as defined therein (collectively, the "Security Documents") and is guaranteed
pursuant to the unconditional guaranties of the Corporate Guarantors defined
therein and is further guaranteed pursuant to the validity guaranties of the
Individual Validity Guarantors (collectively, the "Validity Guarantors").
The Borrower has requested that certain amendments be made to
the Credit Agreement, which the Lender is willing to make pursuant to the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements herein contained, it is agreed as follows:
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1. Definitions and Amendments.
(a) Terms used in this Fifth Amendment which are defined in
the Credit Agreement shall have the same meanings as defined therein,
unless otherwise defined herein.
(b) The definition of the term "Borrowing Base" is hereby
amended as follows: "Borrowing Base" means, at any time and subject to
change from time to time in the Lender's sole discretion, the lesser
of:
(i) $6,150,000 provided, however, that the Borrowing
Base shall be decreased by Two Hundred Fifty Thousand Dollars
($250,000) on the first day of February, 1997 and on the same
day of each successive month thereafter.
or
(c) the sum of:
(i) the lesser of (A) 75% of Eligible Accounts or (B)
$6,150,000; provided, however, that such maximum amount of
Eligible Accounts shall be reduced by $250,000 on the first
day of February, 1997 and on the same day of each successive
month thereafter, plus
(ii) the lesser of (A) 50% of Eligible Inventory or
(B) $6,000,000; provided, however, that such maximum amount of
Eligible Inventory shall be reduced by $100,000 on the first
day of February, 1997 and on the same day of each successive
month thereafter, plus
(iii) $250,000.
1. No Other Amendments.Except as explicitly amended by this Fifth
Amendment, all of the terms and conditions of the Credit Agreement shall remain
in full force and effect and shall apply to any advance thereunder.
2. Amendment Fee. The Borrower agrees to pay the Lender a fully
earned, non-refundable fee in the amount $0.00 in consideration of the execution
by the Lender of this Fifth Amendment.
3. Conditions. This Fifth Amendment shall be effective (the
"Effective Date") upon receipt by the Lender of an executed original hereof,
together with each of the following, each in substance and form acceptable to
the Lender in its sole discretion:
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(a) The Acknowledgement and Agreement of Corporate Guarantors
and the Acknowledgment and Agreement of Validity Guarantors set forth
at the end of this Fifth Amendment, duly executed by each of the
Corporate Guarantors and Individual Validity Guarantors, respectively.
(b) Supplemental Secretary's Certificate certifying (i) the
resolutions of the board of directors of the Borrower approving the
execution and delivery of this Fifth Amendment and the performance by
the Borrower of its obligations under the Fifth Amendment and the
Credit Agreement as amended hereby, (ii) that the Articles of
Incorporation and the Bylaws of the Borrower which were certified and
delivered to the Lender pursuant to the Certificate of the Secretary of
Borrower dated February 9, 1995 continue in full force and effect and
have not been altered, amended or revised, and (iii) the signatures of
the officers and agents of the Borrower authorized to execute and
deliver this Fifth Amendment and other instruments, agreements and
certificates, including Advance requests, on behalf of the Borrower.
(c) Payment of the fees and expenses required to be paid
by the Borrower under Paragraphs 3 and 9 hereof.
(d) Such other documents as the Lender in its sole
discretion may require.
4. Representations and Warranties.
The Borrower hereby represents and warrants to the Lender as follows:
(a) The Borrower has all requisite power and authority to
execute this Fifth Amendment and to perform all of its obligations
hereunder and under the Credit Agreement as amended hereby, and this
Fifth Amendment has been duly executed and delivered by the Borrower
and constitutes the legal, valid and binding obligation of the
Borrower, enforceable in accordance with its terms.
(b) The execution, delivery and performance by the Borrower of
this Fifth Amendment has been duly authorized by all necessary
corporate action and does not (i) require any authorization, consent or
approval by any governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, (ii) violate any
provision of any law, rule or regulation or of any order, writ,
injunction or decree presently in effect, having applicability to the
Borrower, or the Articles of Incorporation or By-Laws of the Borrower,
or (iii) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which the Borrower is a party or by which it or its
properties may be bound or affected.
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(c) All of the representations and warranties contained in
Article V of the Credit Agreement, as amended by this Fifth Amendment,
are correct on and as of the date hereof and on the Effective Date, as
though made on and as of such date, except to the extent that such
representations and warranties relate solely to an earlier date.
5. References. Upon the Effective Date, all references in the Credit Agreement
to "this Agreement" shall be deemed to refer to the Credit Agreement as amended
hereby; and any and all references in the Security Documents to the Credit
Agreement shall be deemed to refer to the Credit Agreement as amended hereby.
6. No Waiver. The Borrower hereby acknowledges and agrees that the
execution of this Fifth Amendment and any documents related hereto shall not be
deemed to be a waiver of any Default or Event of Default under the Credit
Agreement or breach, default or event of default under any Security Document or
other document held by the Lender, whether or not known to the Lender and
whether or not existing on the date of this Fifth Amendment.
7. Release. The Borrower hereby absolutely and unconditionally releases
and forever discharges the Lender, and any and all participants, parent
corporations, subsidiary corporations, affiliated corporations, insurers,
indemnitors, successors and assigns thereof, together with all of the present
and former directors, officers, agents and employees of any of the foregoing,
from any and all claims, demands or causes of action of any kind, nature or
description, whether arising in law or equity or upon contract or tort or under
any state or federal law or otherwise, which the Borrower has had, now has or
has made claim to have against any such person for or by reason of any act,
omission, matter, cause or thing whatsoever arising from the beginning of time
to and including the date of this Fifth Amendment, whether such claims, demands
and causes of action are matured or unmatured or known or unknown.
8. Expenses. The Borrower hereby reaffirms its agreement under the
Credit Agreement to pay or reimburse the Lender on demand for all costs and
expenses incurred by the Lender in connection with the Credit Agreement, the
Security Documents and all other documents contemplated thereby, including
without limitation all reasonable fees and disbursements of legal counsel.
Without limiting the generality of the foregoing, the Borrower specifically
agrees to pay all fees and disbursements of counsel to the Lender for the
services performed by such counsel in connection with the preparation of this
Fifth Amendment and the documents and instruments incidental hereto. The
Borrower hereby agrees that the Lender may, at any time or from time to time in
its sole discretion and without further authorization by the Borrower, make a
loan to the Borrower under the Credit Agreement, or apply the proceeds of any
loan, for the purpose of paying any such fees, disbursements, costs and expenses
and the fee required under Paragraph 3 hereof.
9. Counterparts. This Fifth Amendment, the Acknowledgement and
Agreement of Corporate Guarantors and the Acknowledgment and Agreement of
Validity Guarantors may be executed in any number of counterparts, each of which
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when so executed and delivered shall be deemed an original and all of which
counterparts, taken together, shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Fifth
Amendment to be duly executed as of the day and year first above written.
BORROWER:
FIELDS AIRCRAFT SPARES INCORPORATED (SEAL)
By:______________________________________
Its:_____________________________________
LENDER:
NORWEST BUSINESS CREDIT, INC. (SEAL)
By:_____________________________________
Its:____________________________________
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