EXHIBIT 10.4
AMENDMENT NO. 8 AND WAIVER
Dated as of February 18, 2000
to
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of October 17, 1997
This Amendment No. 8 and Waiver (the "Amendment") dated as of
February 18, 2000 is entered into among AVIATION SALES DISTRIBUTION SERVICES
COMPANY, a Delaware corporation ("ASOC"), AEROCELL STRUCTURES, INC., an Arkansas
corporation ("Aerocell"), AVS/XXXXX-XXXXX MACHINE COMPANY, a Delaware
corporation ("Xxxxx-Xxxxx"), WHITEHALL CORPORATION, a Delaware corporation
("Whitehall"), TRIAD INTERNATIONAL MAINTENANCE CORPORATION, a Delaware
corporation ("TIMCO"), APEX MANUFACTURING, INC., an Arizona corporation
("Apex"), CARIBE AVIATION, INC., a Florida corporation ("Caribe"), AIRCRAFT
INTERIOR DESIGN, INC., a Florida corporation ("Design"), AVIATION SALES LEASING
COMPANY, a Delaware corporation ("Leasing"), TIMCO ENGINE CENTER, INC., a
Delaware corporation ("TIMCO Engine"), AVIATION SALES COMPANY, a Delaware
corporation ("Parent"), and the "Lenders" (as defined in the Credit Agreement
identified below) a party hereto. Capitalized terms used herein without
definition are used herein as defined in the Credit Agreement.
PRELIMINARY STATEMENT:
WHEREAS, ASOC, Aerocell, Xxxxx-Xxxxx, Whitehall, TIMCO, Apex,
Caribe, and Design, as Borrowers, Parent, Citicorp USA, Inc., as Agent, and
certain financial institutions, as Lenders and Issuing Banks, are parties to
that certain Third Amended and Restated Credit Agreement dated as of October 17,
1997, as heretofore amended (the "Credit Agreement");
WHEREAS, the Borrowers have requested a $15,500,000 term loan
in addition to the Revolving Loans available under the terms of the Credit
Agreement and Citicorp USA, Inc. has agreed to provide such term loan to the
Borrowers on the terms and conditions set forth in EXHIBIT A attached hereto and
made a part hereof;
WHEREAS, the Lenders party hereto have consented to the
aforesaid additional extension of credit on the terms and conditions set forth
below; and
WHEREAS, in consideration of the foregoing, the parties hereto
have agreed to amend the Credit Agreement as set forth below in SECTION 1,
subject to the terms and conditions stated in this Amendment;
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT. Effective as of
February 18, 2000, subject to the satisfaction of the conditions precedent set
forth in SECTION 3 hereof, the Credit Agreement is hereby amended as follows:
1.1 SECTION 1.01 is amended to add the following definitions:
"Standstill Letter" means that certain Standstill Letter dated
January 31, 2000 executed and delivered to Parent and the Borrowers by
the Lenders.
"Supplemental Term Loan" means that certain term loan made by Citicorp
USA, Inc., to the Borrowers pursuant to the Term Loan Note dated
February 18, 2000, a copy of which is attached as EXHIBIT A to
Amendment No. 8 and Waiver dated as of February 18, 2000 to this
Agreement.
1.2 SECTION 2.05 is amended to add the following provision at
the end thereof:
In no event shall proceeds of the Loans be used, directly or
indirectly, to provide a deposit in escrow or otherwise or cash
collateral for any obligation under the TROL Documents or any letter of
credit issued in support thereof which is not a Letter of Credit or to
make any payment of Indebtedness incurred under or in connection with
the TROL Documents other than obligations incurred under the TROL Lease
in the ordinary course of business of Parent.
1.3 SECTION 3.01(A) is amended to delete the word "or" at the
end of CLAUSE (III) thereof, delete the "." at the end of CLAUSE (IV) thereof
and substitute therefor a "; and", and add the following clauses at the end
thereof:
(v) for the purpose of supporting, directly or indirectly, Indebtedness
under the TROL Documents or incurred in connection with the development
of and construction on the Property financed thereunder other than the
Letter of Credit outstanding as of February 18, 2000 and an amendment
thereto or additional Letter of Credit issued on or after March 1, 2000
providing for additional support for Indebtedness under the TROL
Documents in an amount not to exceed $4,004,800, subject to all of the
other conditions of this Agreement and the Standstill Letter.
1.4 SECTION 8.03 is amended to (i) delete the provisions of
CLAUSE (A) thereof in their entirety and substitute the following therefor:
(a) Borrowing Base Certificate. ASOC shall provide the Agent and the
Revolving Lenders (i) on Wednesday of each calendar week commencing on
February 23, 2000, or if a Wednesday is not a Business Day, the
immediately succeeding Business Day, with a Borrowing Base Certificate
for Eligible Receivables as of the immediately preceding Friday, (ii)
on a bi-weekly basis, on Wednesday of the applicable week, commencing
on February 23, 2000, or if a Wednesday is not a Business Day, the
immediately succeeding Business Day, with a Borrowing Base Certificate
for Eligible Inventory of ASOC as of the immediately preceding Friday,
and (iii) on a monthly basis, commencing on March 8, 2000 and
continuing on the second Wednesday of each month thereafter, or if a
Wednesday is not a Business Day, the immediately succeeding Business
Day, with a
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Borrowing Base Certificate for Eligible Inventory of Persons other than
ASOC as of the immediately preceding month end, in each instance,
together with a calculation of the Texas Tax Reserve as of the date
thereof if such Texas Tax Reserve exceeds $200,000 and such supporting
documents as the Agent deems desirable, all certified as being true and
correct by the chief financial officer, chief executive officer, or
controller of ASOC.
and (ii) add the following provision at the end of CLAUSE (B) thereof:
Notwithstanding the foregoing, Parent and the Borrowers shall engage an
independent appraiser satisfactory to the Agent by no later than
February 18, 2000 to prepare an appraisal of ASOC's Inventory and
Inventory of such other Borrowers and their respective Subsidiaries as
the Agent shall require on a basis satisfactory to the Agent and shall
cooperate fully with such appraiser to enable it to complete and
deliver the resultant appraisal to the Agent and Lenders by no later
than March 15, 2000.
1.5 SECTION (A) 10.01(C) is amended to delete the reference
thereat to "Intentionally omitted." and substitute the following therefor:
(c) Indebtedness incurred with respect to the Supplemental Term Loan,
whether directly or by Accommodation Obligation;
1.6 SECTION (A) 10.03(E) is amended to delete the reference
thereat to "Intentionally omitted." and substitute the following therefor:
(e) Liens securing the Indebtedness permitted under SECTION (A)
10.01(C) pursuant to the Collateral Documents Amendment, a copy of
which is attached as EXHIBIT A to Amendment No. 8 and Waiver dated as
of February 18, 2000 to this Agreement;
1.7 SECTION (A) 10.05(D) is amended to delete the reference
thereat to "Intentionally omitted." and substitute the following therefor:
(d) Accommodation Obligations with respect to Indebtedness permitted
under SECTION (A) 10.01(C) pursuant to the Guaranty, a copy of which is
attached as EXHIBIT A to Amendment No. 8 and Waiver dated as of
February 18, 2000 to this Agreement;
1.8 SECTION (B) 10.17(F) is amended to delete the provisions
thereof in their entirety and substitute the following therefor:
(f) grant or suffer to exist any Lien against any property or asset of
the Parent other than Liens securing the Obligations and the Parent's
guarantee of the Indebtedness of the Borrowers with respect to the
Supplemental Term Loan and an assignment of its leasehold interest
under the TROL Lease to secure its obligations under the TROL
Documents.
1.9 SCHEDULE 1.01.3 is hereby deleted in its entirety and the
Schedule 1.01.3 attached hereto and made a part hereof substituted therefor.
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SECTION 2. WAIVER.
2.1 The Issuing Bank and Lenders signatory hereto hereby waive
their rights to the application of the "Excess Designated Prepayment" (as
defined below) which are payable pursuant to SECTION 4.01(B)(I) and as provided
in SECTION 4.01(B)(IV) of the Credit Agreement to Revolving Loans owing to such
Lenders and Letter of Credit Obligations (or required to be deposited as Cash
Collateral in respect of Letter of Credit Obligations) as provided in SECTION
4.01(B)(VII) or SECTION 4.02(B)(II) of the Credit Agreement; PROVIDED THAT the
Excess Designated Prepayment is remitted to Citicorp USA, Inc. for application
on the Supplemental Term Loan concurrently with the balance of such Net Cash
Proceeds of Sale being remitted to the Agent for application (i) FIRST, to the
amount by which the aggregate principal of the Revolving Loans exceeds (a) the
Maximum Revolving Credit Amount MINUS (b) the Letter of Credit Obligations and
(ii) THEN, under SECTION 4.01(B)(VII).
2.2 For purposes of Section 2.1 above, the term"Excess
Designated Prepayment" means the amount by which Net Cash Proceeds of Sale of
the property identified on EXHIBIT B attached hereto and made a part hereof
exceed the sum of (i) the amount by which the aggregate principal of the
Revolving Loans exceeds (a) the Maximum Revolving Credit Amount MINUS (b) the
Letter of Credit Obligations, PLUS (ii) the amount by which that portion of the
Designated Prepayments arising from such Net Cash Proceeds of Sale exceeds that
portion of the Borrowing Base allocable to such property (or, in the event of a
sale of Capital Stock, the property of the issuer of such Capital Stock) as of
the date of such prepayment.
SECTION 3. CONDITIONS PRECEDENT TO EFFECTIVENESS OF THIS
AMENDMENT. This Amendment shall become effective as of February 18, 2000, if,
and only if the Agent shall have received:
(a) a facsimile or original executed copy of this Amendment executed by
the Parent, each Borrower, the Issuing Bank and Lenders constituting at
least the Requisite Lenders;
(b) the written consent of the beneficiaries of the TROL Guaranties to
the incurrence of the Indebtedness with respect to the Supplemental
Term Loan permitted by SECTION (A) 10.01(C), as amended hereby;
(c) an opinion of counsel to the Borrowers and Parent with respect to
non-contravention of the TROL Documents and agreements under which the
Senior Subordinated Notes have been issued;
(d) a Borrowing Base Certificate dated as of February 11, 2000; and
(e) all instruments and agreements required to perfect Liens against
all Property included on the February 15, 2000 Borrowing Base
Certificate, in proper form for recordation, signed by the appropriate
Borrower.
SECTION 4. REPRESENTATIONS AND WARRANTIES; ACKNOWLEDGMENT. The
Borrowers hereby represent and warrant as follows:
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4.1 This Amendment and the Credit Agreement as previously
executed and delivered and as amended hereby constitute legal, valid and binding
obligations of the Borrowers and are enforceable against the Borrowers in
accordance with their terms.
4.2 No Event of Default or Potential Event of Default exists,
other than as referenced in that certain Waiver and Consent Letter dated
December 27, 1999 or otherwise heretofore disclosed by Parent to the Agent and
Lenders, or would result from any of the transactions contemplated by this
Amendment. No event of default or default has occurred and continues unwaived
under the terms of any of the TROL Documents, except as described in that
certain Standstill, Waiver and Consent Letter attached hereto as EXHIBIT C and
made a part hereof, or any of the agreements and documents executed with respect
to the Senior Subordinated Notes or under which the Senior Subordinated Notes
have been issued. The Borrowers hereby acknowledge that the Agent, Lenders and
Issuing Bank have reserved all rights with respect to Events of Default and
Potential Events of Default existing as of the date of this Amendment, subject
only to the agreement of the Lenders to continue providing financing
accommodations under the Credit Agreement on the conditions set forth in that
certain Standstill Letter dated January 31, 2000.
4.3 Upon the effectiveness of this Amendment, each Borrower
hereby reaffirms all covenants, representations and warranties made by it in the
Credit Agreement to the extent the same are not amended hereby and agree that
all such covenants, representations and warranties shall be deemed to have been
remade as of the date this Amendment becomes effective (unless a representation
and warranty is stated to be given on and as of a specific date, in which case
such representation and warranty shall be true, correct and complete as of such
date).
SECTION 5. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT.
5.1 Upon the effectiveness of this Amendment, each reference
in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import shall mean and be a reference to the Credit Agreement, as
amended hereby, each reference to the Credit Agreement in any other document,
instrument or agreement executed and/or delivered in connection with the Credit
Agreement shall mean and be a reference to the Credit Agreement as amended
hereby.
5.2 Except as specifically amended above, the Credit
Agreement, the Notes and all other Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed.
5.3 The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of any right, power or remedy of any
Lender or Issuing Bank or the Agent under the Credit Agreement, the Notes or any
of the other Loan Documents, nor constitute a waiver of any provision contained
therein, except as specifically set forth herein.
SECTION 6. EXECUTION IN COUNTERPARTS. This Amendment may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same instrument. Delivery of an executed counterpart of
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this Amendment by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment.
SECTION 7. GOVERNING LAW. This Amendment shall be governed by
and construed in accordance with the laws of the State of New York.
SECTION 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.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective officers thereunto duly authorized
as of the date first above written.
AVIATION SALES DISTRIBUTION AEROCELL STRUCTURES, INC.
SERVICES COMPANY
By___________________________ By________________________
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Executive Vice President Title:
AVS/XXXXX-XXXXX MACHINE COMPANY WHITEHALL CORPORATION
By___________________________ By________________________
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Title: Title:
TRIAD INTERNATIONAL MAINTENANCE APEX MANUFACTURING, INC.
CORPORATION
By___________________________ By________________________
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Title: Title:
AIRCRAFT INTERIOR DESIGN, INC. CARIBE AVIATION, INC.
By___________________________ By________________________
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Title: Title:
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AVIATION SALES COMPANY AVIATION SALES LEASING COMPANY
By__________________________ By________________________
Xxxxxx X. Xxxxx Xxxxxx X. Xxxxx
Title: Title:
REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK
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TIMCO ENGINE CENTER, INC.
By__________________________
Xxxxxx X. Xxxxx
Title:
CITICORP USA, INC. XXXXXX FINANCIAL, INC.
as Agent and Lender
By___________________________ By__________________________
Name: Name:
Title: Title:
NATIONAL CITY COMMERCIAL CITIBANK, N.A.
FINANCE, INC. as Issuing Bank
By____________________________ By__________________________
Name: Name:
Title: Title:
FIRST UNION COMMERCIAL CREDIT LYONNAIS, NEW YORK
CORPORATION BRANCH
By___________________________ By__________________________
Name: Name:
Title: Title:
IBJ WHITEHALL BUSINESS CREDIT BANKBOSTON, N.A.
CORPORATION
By__________________________ By__________________________
Name: Name:
Title: Title:
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SUNTRUST BANK, MIAMI, N.A. BANKATLANTIC
By_________________________ By_________________________
Name: Xxx X. Xxxxxx
Title: Senior Vice President
THE INTERNATIONAL BANK OF NATIONAL BANK OF CANADA
MIAMI, N.A. A Canadian Chartered Bank
By_________________________ By_________________________
Xxxxxxx X. Xxxxxxxxx Xxxxx X. D'Alto
Vice President Vice President
Trade Finance Division
By_________________________
Xxxxxxx X. Xxxxxxxxxxx
Vice President & Manager
MERCANTILE BUSINESS CREDIT, INC. CITIZENS BUSINESS CREDIT
COMPANY
By_________________________ By_________________________
Xxxxxx X. Xxxxxxxx Xxxx Xxxxxxxxx
Assistant Vice President Vice President
AMSOUTH BANK PNC BANK NATIONAL ASSOCIATION
By__________________________ By_________________________
Name: Name:
Title: Title:
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