ASSIGNMENT AND ACCEPTANCE
Exhibit
10.1
Reference is made to the Amended and Restated Financing Agreement dated as of April 8, 2005
(as amended and otherwise modified to the date hereof, the “Financing Agreement”) among Monroe
Investments, Inc. (“Monroe Investments”), Monroe Capital Advisors LLC (“Monroe Capital”, and
together with Monroe Investments, “Monroe”) and Fortress Credit Opportunities I LP (“Fortress”, and
together with Monroe, the “Assignors”) and TIMCO Aviation Services, Inc. and certain of its
affiliates parties thereto (collectively, the “Companies”). Capitalized terms not otherwise
defined herein shall have the same meanings as specified therefor in the Financing Agreement.
SECTION 1. Each of the Assignors hereby sells and assigns, without recourse except as to the
representations and warranties made by it herein, to LJH, Ltd. (the “Assignee”), and the Assignee
hereby purchases and assumes from the Assignors, all of the Assignors’ rights, interests and
obligations in and under the Financing Agreement and the other Loan Documents as of the Effective
Date (as hereinafter defined) other than the Retained Interest (as hereinafter defined) (the
“Assigned Interest”). After giving effect to such sale and assignment, the Assignee shall be the
sole “Lender” under the Financing Agreement and all of the other Loan Documents.
SECTION 2. Each of the Assignors represents and warrants solely as to itself that (a) it has
not sold, assigned or otherwise transferred any right or interest, whether legal, beneficial or
otherwise, in the Notes (as hereinafter defined), the Obligations or any other rights or
obligations under the Financing Agreement or the other Loan Documents to any Person other than the
Assignors; (b) it has the full power and authority, and have taken all action necessary, to execute
and deliver this Assignment and Acceptance, and to perform its obligations hereunder; and (c) no
governmental or third party approvals or consents are required for it to execute and deliver this
Assignment and Acceptance, and to perform its obligations hereunder.
SECTION 3. The Assignors represent and warrant that (a) they are the legal and beneficial
owners of the Assigned Interest and that such Assigned Interest is free and clear of any lien,
encumbrance or other adverse claim; (b) other than as provided herein, make no representation or
warranty and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Financing Agreement or any of the other Loan
Documents, or the execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Financing Agreement or any of the other Loan Documents, or any other instrument or document
furnished pursuant thereto; and (c) make no representation or warranty and assumes no
responsibility with respect to the financial condition of any of the Companies or any of their
affiliates or the performance or observance by any of the Companies of any of their Obligations, or
any other instrument or document furnished pursuant thereto.
SECTION 4. The Assignee (a) represents and warrants that its name set forth on the signature
pages hereof is its legal name; (b) confirms that it has received a copy of the Financing Agreement
and the other Loan Documents, together with copies of the financial statements referred to therein
and such other documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (c) agrees that it has made and
will continue to make, independently and without reliance upon the either Assignor and based on
such documents and information as it shall deem appropriate at the time, its own credit decisions
in taking or not taking action under the Financing Agreement and the other Loan Documents; (d)
confirms that it is eligible as an assignee under the terms of the Financing Agreement and the
other Loan Documents; and (e) agrees that, from and after the Effective Date, it will be bound by
the provisions of the Financing
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Agreement and the other Loan Documents and it will perform in accordance with their terms all
of the obligations that by the terms of the Financing Agreement and the other Loan Documents are
required to be performed by it as the Lender.
SECTION 5. Upon the request of the Assignee, at the sole cost and expense of the Borrowers,
Monroe hereby agrees to execute and deliver, or to cause to be executed and delivered, such
assignments and other instruments of transfer as may be reasonably requested by the Assignee to
effectuate the intent and purposes, and to carry out the terms, of this Assignment and Acceptance,
and to further assign and transfer to the Assignee the liens and security interests created
pursuant to the Loan Documents, and such assignments and instruments of transfer shall be in proper
form for recording in the appropriate filing and recording offices. Monroe hereby authorizes the
Assignee to make such filings (including the filings of UCC-3 assignments) as are necessary to make
the assignments contemplated hereby in the appropriate jurisdictions. Monroe hereby agrees to
deliver to the Assignee on the Effective Date all possessory Collateral and all Loan Documents in
Monroe’s possession.
SECTION 6. [RESERVED]
SECTION 7. Each of the Companies and the Guarantors hereby waives any obligation of the
Assignee to attach to this Assignment and Acceptance or otherwise deliver to any or all of the
Borrowers the forms prescribed by the Internal Revenue Service of the United States certifying as
to the Assignee’s status for purposes of determining exemption from the United States withholding
taxes with respect to all payments to be made to the Assignee under the Financing Agreement or such
other documents as are necessary to indicate that all such payments are subject to such rates at a
rate reduced by an applicable tax treaty.
SECTION 8. (a) The Assignors acknowledge that (i) the Assignee may now possesses and may
hereafter possess certain non-public information concerning the Companies, the Loan Documents and
the transactions contemplated thereby, that may or may not be independently known by the Assignors,
and which may constitute material information with respect to the foregoing; (ii) the Assignee has
no obligation to furnish the non-public information to the Assignors; and (iii) the Assignors have
adequate information concerning the Loan Documents and the business and financial condition of the
Companies to make an informed decision regarding entering into this Assignment and Acceptance.
(b) The Assignee acknowledges that (i) one or more of the Assignors may now possess and may
hereafter possess certain non-public information concerning the Companies, the Loan Documents and
the transactions contemplated thereby, that may or may not be independently known by the Assignee,
and which may constitute material information with respect to the foregoing; (ii) the Assignors
have no obligation to furnish the non-public information to the Assignee; and (iii) the Assignee
has adequate information concerning the Loan Documents and the business and financial condition of
the Companies to make an informed decision regarding entering into this Assignment and Acceptance.
SECTION 9. The Assignors and the Assignee hereby acknowledge and agree that the Intercreditor
Agreement dated as of April 5, 2004 (as amended and otherwise modified to the date hereof, the
“Intercreditor Agreement”) between The CIT/Group/Business Credit, Inc. and Hilco Capital LP remains
in full force and effect, and that by entering into this Assignment and Acceptance, the Assignee
agrees that it and each of its successors and assigns shall be bound by the terms and conditions of
the Intercreditor Agreement.
SECTION 10. Upon the occurrence of the Effective Date, each of the Assignors, the Assignee and
the Companies, for itself and on behalf of each of its subsidiaries, successors and assigns, hereby
expressly, absolutely, unconditionally and forever waives, releases and discharges any and all of
3
the Released Claims (as hereinafter defined) any of them may have or allege to have (and all
defenses which may arise out of any of the foregoing), against any or all of the Assignors, the
Assignee and the Companies, and their respective affiliates, equityholders and “controlling
persons” (within the meaning of the United States federal securities laws) and their respective
successors and assigns and each and all of the employees, directors, officers, attorneys, agents
and other representatives of each of the foregoing (collectively, the “Released Parties”), based in
whole or in part on any facts relating to the Released Claims, whether known or unknown. As used
herein, the term “Released Claims” means any and all claims (including, without limitation,
cross-claims, counterclaims, right of setoff and recoupment), causes of actions, demands, suits,
costs, expenses and damages of any nature, description or kind whatsoever (“Claims”), whether known
or unknown, whether now or hereafter arising, and whether arising in law or at equity, for or
resulting from any matter of things done, omitted or suffered to be done by any of the Released
Parties up to and including the Effective Date which relate to the Obligations, the Loan Documents,
any use or proposed use of the Loans or the proceeds thereof, or any of the other transactions
contemplated hereby or thereby; provided, that the Released Claims shall not include Claims (a) for
or relating to the Retained Interest, (b) among or between one or more of the Companies, the
Assignee and/or their respective subsidiaries, affiliates, officers, attorneys, agents or
representatives, (c) relating to the obligations of the Companies and the Assignee under the Loan
Documents, including the liens and security interests securing the Obligations, and (d) relating to
the representations and warranties set forth in Sections 2, 3 and 4, and the agreements set forth
in Section 5, of this Assignment and Acceptance
SECTION 11. The Effective Date shall be the first date on which each of the following
conditions are satisfied, which date shall occur no later than April 10, 2006: (a) this Assignment
and Acceptance shall have been duly executed and delivered by each of the parties hereto; (b) all
amounts reflected on Schedule I hereto (the “Purchase Price”) as owing to the Assignors, whether
from the Borrowers or the Assignee, shall have been deposited in immediately available funds to the
account of Monroe Capital Advisors LLC maintained by Lasalle National Bank N.A. at its offices at
000 X. XxXxxxx Xxxxxx, Xxxxxxx, XX 00000, ABA No. 000-000-000, Account No. 5800969056, Reference:
Monroe Capital Advisors Funding Act.; and (c) the Notes owing to or otherwise held by the Assignors
and described on Schedule II hereto (the “Notes”) shall have been delivered to the Assignee,
together with duly executed endorsements thereto. Upon such execution, delivery, payment and
receipt, from and after the Effective Date, (a) the Assignee shall be a party to the Financing
Agreement and, to the extent that rights and obligations under the Financing Agreement have been
assigned to it pursuant to this Assignment and Acceptance, have the rights and obligations of the
Lender thereunder; (b) the Assignors shall, to the extent that any rights and obligations under the
Financing Agreement have been assigned by it pursuant to this Assignment and Acceptance, relinquish
their rights (other than their rights (such rights being the “Retained Interest”) under Section
7.12 of the Financing Agreement (and other comparable provisions of the other Loan Documents that
are specified under the terms of such other Loan Documents to survive the payment in full of the
Obligations) to the extent that any claim thereunder relates to an event arising prior to the
Effective Date but excluding claims solely between the Assignors) and be released from their
obligations, and the Assignors shall cease to be a party thereto; provided, that the Retained
Interest does not include legal fees relating from a dispute among Assignors and Assignee caused
solely by a breach of this Assignment Agreement; and (c) the Companies shall make all payments
under the Financing Agreement and the Notes in respect of the Assigned Interest (including, without
limitation, all payments of principal, interest and the fees with respect thereto) to the Assignee.
SECTION 12. To the extent Fortress Credit Opportunities I LP or Monroe Investments, Inc. is
considered a legal or beneficial owner or holder of the Notes, each hereby consents to and
instructs Monroe Capital Advisors LLC to endorse and deliver the Notes to Assignee on its behalf.
Monroe confirms and agrees that the General Assignment Agreement dated as if April 8, 2005,
executed and delivered by Hilco Capital LP in favor of Monroe Capital is a “Loan Document” for
purposes of the assignment by Monroe Capital in Section 1.
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SECTION 13. The Assignee hereby agrees to indemnify, defend, and hold the Assignors and any
employee, officer, director, affiliate, parent, attorney or agent of the Assignors (each, an
“Indemnified Person”) harmless of and from any loss or liability arising from failure by Assignee
to provide Monroe with an original counterpart of the Financing Agreement within ten (10) Business
Days after Monroe’s request therefor in connection with litigation involving a claim by an Assignor
for indemnification thereunder (as well as from reasonable attorneys’ fees and expenses in
connection therewith). The Assignee, by executing this Assignment and Acceptance where indicated
below, acknowledges and agrees that its liability and obligations under this Section 13 shall
continue in full force and effect until specifically terminated in writing by a duly authorized
officer of the Assignors.
SECTION 14. This Assignment and Acceptance shall be governed by, and construed in accordance
with, the laws of the State of New York.
SECTION 15. This Assignment and Acceptance shall be binding upon, and inure to the benefit of,
the parties hereto and their respective successors and assigns. This Assignment and Acceptance may
be executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement. Delivery of an executed counterpart of this
Assignment and Acceptance hereto by telecopier email shall be effective as delivery of an
originally executed counterpart of this Assignment and Acceptance. All representations,
warranties, covenants and other provisions made by the parties hereto shall be considered to have
been relied upon by the parties hereto, shall be true and correct in all material respects as of
the Effective Date, and shall survive the execution, delivery and performance of this Assignment
and Acceptance.
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IN WITNESS WHEREOF, the Assignors, the Assignee and TIMCO Aviation Services, Inc. have caused
this Assignment and Acceptance to be executed by their respective officers thereunto duly
authorized, as of the date specified hereon.
ASSIGNORS
| MONROE CAPITAL ADVISORS, LLC, as Assignor | ||||||
| By /s/ Xxx Xxxxxx |
||||||
| Name: Xxx Xxxxxx | ||||||
| Title: President | ||||||
| MONROE INVESTMENTS, INC., as Assignor | ||||||
| By /s/ Xxx Xxxxxx |
||||||
| Name: | Xxx Xxxxxx | |||||
| Title: | President | |||||
| FORTRESS CREDIT OPPORTUNITIES I LP, as Assignor | ||||||
| By /s/
Xxxxxxxxxxx Xxxxxxxx |
||||||
| Name: | Xxxxxxxxxxx Xxxxxxxx | |||||
| Title: | Chief Credit Officer | |||||
Assignment and Acceptance
| ASSIGNEE | ||||||
| LJH, LTD., as Assignee | ||||||
| By: DLH Management, LLC, its general partner | ||||||
| By /s/ Xxxx
Xxxxxx |
||||||
| Name: | Xxxx Xxxxxx | |||||
| Title: | President | |||||
| COMPANIES | ||||
| Agreed and Approved this 10th day of April, 2006 | ||||
| TIMCO AVIATION SERVICES, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AIRCRAFT INTERIOR DESIGN, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| XXXXX MANUFACTURING COMPANY, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| TIMCO ENGINE CENTER, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| TIMCO ENGINEERED SYSTEMS, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| TRIAD INTERNATIONAL MAINTENANCE CORPORATION | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVIATION SALES DISTRIBUTION SERVICES COMPANY | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVIATION SALES LEASING COMPANY | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVIATION SALES PROPERTY MANAGEMENT CORP. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVS/CAI, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVS/M-1, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVS/M-2, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVS/M-3, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| AVSRE, L.P. | ||||
| By: Aviation Sales Property Management Corp, its general partner | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| HYDROSCIENCE, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| TMAS/ASI, INC. | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
| WHITEHALL CORPORATION | ||||
By /s/
Xxxxx Xxxxxx |
||||
Name: |
Xxxxx Xxxxxx | |||
Title: |
Senior Vice President, Finance | |||
Schedule I
to
ASSIGNMENT AND ACCEPTANCE
to
ASSIGNMENT AND ACCEPTANCE
| ACCRUED INTEREST | ||||||||||||
| LOAN TYPE | LOAN BALANCE | (Current & PIK) | TOTAL DUE | |||||||||
Term Loan A-1 |
$ | 8,158,314.57 | $ | 31,979.75 | $ | 8,190,294.32 | ||||||
Term Loan A-2 |
$ | 7,138,507.47 | $ | 27,982.20 | $ | 7,166,489.67 | ||||||
Term Loan B |
$ | 2,627,508.00 | $ | 9,496.71 | $ | 2,637,004.71 | ||||||
TOTALS: |
$ | 17,924,330.04 | $ | 69,458.66 | $ | 17,993,788.70 | ||||||
| PREPAYMENT PENALTY: |
$ | 0 | ||||||||||
| ACCRUED FACILITY FEES: |
$ | 0 | ||||||||||
| ACCRUED COLLATERAL MANAGEMENT FEES: |
$ | 0 | ||||||||||
| ACCRUED SUCCESS FEES: |
$ | 0 | ||||||||||
| ACCRUED LEGAL FEES/EXPENSES |
$ | 0 | ||||||||||
| ACCRUED DEFAULT INTEREST |
$ | 319,466.38 | ||||||||||
| TOTAL PURCHASE PRICE |
$ | 18,313,255.08 | ||||||||||
Schedule II
to
ASSIGNMENT AND ACCEPTANCE
Notes
| 1. | Term Note dated as of April 5, 2004 (the “Term Note”) payable to Hilco Capital LP in the principal amount of $8,000,000. |
| 2. | Term Note A-2 dated as of April 8, 2005 payable to Monroe Capital Advisors LLC in the principal amount of $7,000,000. |
| 3. | Term Note B dated as of April 8, 2005 payable to Monroe Capital Advisors LLC in the principal amount of $3,000,000. |
