EXHIBIT 2.12
EIGHTH AMENDMENT AND AGREEMENT
EIGHTH AMENDMENT AND AGREEMENT, dated as of December 8, 1998 (this "Eighth
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Amendment"), to the Existing Credit Agreement (as hereinafter defined), by and
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among INTERNATIONAL AIRLINE SUPPORT GROUP, INC., a Delaware corporation (the
"Borrower"), and BNY FINANCIAL CORPORATION, a New York corporation (the
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"Lender").
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RECITALS
The Borrower and the Lender have entered into the Existing Credit
Agreement, pursuant to which the Lender is providing to the Borrower (i) a
$13,000,000.00 revolving credit facility, (ii) a $3,000,000.00 term loan
facility, (iii) a $3,750,000.00 term loan facility, (iv) a $1,500,000.00 term
loan facility, (v) a $1,600,000.00 term loan facility (vi) a $1,000,000.00
revolving credit facility and (vi) a $2,000,000 letter of credit facility which
are secured by accounts receivable, inventory and other collateral of the
Borrower. The Borrower and the Lender desire to amend the Existing Credit
Agreement to make certain changes in the method of calculating of the Revolver
Borrowing Base (as defined in the Existing Credit Agreement.
In consideration of the foregoing and of the mutual covenants and
undertakings herein contained, the parties hereto hereby agree that the Existing
Credit Agreement is amended as hereinafter provided.
ARTICLE I
Definitions
1. Definitions. (a) In addition to the definitions set forth in the heading
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and the recitals to this Eighth Amendment, the following definitions shall apply
to this Eighth Amendment:
"Agreement": means the Existing Credit Agreement as amended by this
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Eighth Amendment.
"Existing Credit Agreement": means the Credit Agreement, dated as of
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September 30, 1996, between the Borrower and the Lender, as amended by the First
Amendment, Waiver and Agreement, dated as of March 24, 1997, between the
Borrower and the Lender, the Second Amendment and Agreement, dated as of
September 9, 1997, between the Borrower and the Lender, the Third Amendment and
Agreement, dated as of October 15, 1997, between the Borrower and the Lender,
the Fourth Amendment and Agreement, dated as of February 4, 1998 between the
Borrower and the Lender, the Fifth Amendment, dated as of July 16, 1998, between
the Borrower and the Lender, the Sixth Amendment, dated as of May 30, 1998,
between the Borrower and the Lender, and the Seventh Amendment dated as of
October 28, 1998 as the same may have been further amended, supplemented or
modified from time to time up to but not including the effectiveness of this
Eighth Amendment.
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"Eighth Amendment Documents": this Eighth Amendment and any other
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agreements, instruments and documents executed or delivered pursuant to or in
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connection with this Eighth Amendment and the transactions contemplated thereby.
(a) Unless otherwise indicated, capitalized terms that are used but not
defined herein shall have the meanings ascribed to them in the Existing Credit
Agreement.
ARTICLE II
Representations
1. Representations. The Borrower hereby represents and warrants as follows:
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(a) It (i) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (ii) has the power and
authority, and the legal right, to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged, (iii) is duly qualified and in good standing under the laws
of each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification and (iv) is in compliance
with all Requirements of Law except to the extent that the failure to comply
therewith reasonably could not, in the aggregate, be expected to have a Material
Adverse Effect.
(b) It has the power and authority, and the legal right, to make, deliver
and perform this Eighth Amendment and the other Eighth Amendment Documents to
which it is a party and to borrow under the Agreement and has taken all
necessary action to authorize the borrowings on the terms and conditions of the
Agreement and this Eighth Amendment and to authorize the execution, delivery and
performance of the Eighth Amendment Documents to which it is a party. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the borrowings under the Agreement or with the execution,
delivery, performance, validity or enforceability of the Eighth Amendment
Documents to which it is a party. Each Eighth Amendment Document to which the
Borrower is a party has been or will be duly executed and delivered on behalf of
the Borrower. Each Eighth Amendment Document to which the Borrower is a party
when executed and delivered will constitute a legal, valid and binding
obligation of the Borrower enforceable against it in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing.
(c) The conditions contained in Article IV hereof have been satisfied.
(d) Each of the Credit Documents is on the date hereof in full force and
effect.
(e) The Secured Loan Agreement is on the date hereof in full force and
effect and no DefauIt (as defined therein) or Event of Default (as defined
therein) has occurred and is continuing on the date hereof.
ARTICLE III
Amendments to Section 1 of the Existing Credit Agreement
1. Section 1.1 of the Existing Credit Agreement is hereby amended by
inserting the following new definitions therein in alphabetical order:
"Eighth Amendment": that certain Eighth Amendment and Agreement,
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dated as of December __, 1998, between the Borrower and the Lender.
"Eighth Amendment Documents": the Eighth Amendment and any other
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agreements, instruments and documents executed or delivered pursuant to or in
connection with the Eighth Amendment and the transactions contemplated thereby.
"Eighth Amendment Effective Date": the date on which all of the
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conditions precedent to the effectiveness of the Eighth Amendment set forth in
Article IV of the Eighth Amendment are first satisfied or waived.
"Orderly Liquidation Value": as to any Aircraft, Airframe,
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Aircraft Engine or Aircraft Part, or group of any of the foregoing, as
determined by the Lender or the Appraiser, the value of such Aircraft, Airframe,
Aircraft Engine, Aircraft Part or group based on the assumption that it is sold
in a one-year, orderly marketing period.
2. Clause I of the definition of "Revolver Borrowing Base" in Section 1.1 of
the Existing Credit Agreement is hereby deleted in its entirety and
replaced by the following:
"I. the sum of (a) 85% (or such other percentage as the Lender
shall determine in its sole and absolute discretion) of the total outstanding
balance, after subtracting any Collateral Reserves, of then Eligible Accounts
and Eligible Lease Payment Receivables, (b) 100% (or such other percentage as
the Lender shall determine in its sole and absolute discretion) of the aggregate
amount of all maintenance reserves held in a restricted account pursuant to
Section 3.5(f), and (c) the least of (i) 100% (or such other percentage as the
Lender shall determine in its sole and absolute discretion) of the total cost,
after subtracting any Collateral Reserves, of then Eligible Inventory plus
$500,000.00, (ii) 50% (or such other percentage as the Lender shall determine in
its sole and absolute discretion) of the Orderly Liquidation Value, after
subtracting any Collateral Reserves, of such Eligible Inventory and (iii)
$11,500,000.00;"
3. The definition of the term "Credit Documents" in Section 1.1 of the
Existing Credit Agreement is hereby deleted in its entirety and replaced with
the following:
" "Credit Documents": this Agreement, the First Amendment, the
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Second Amendment, the Third Amendment, the Fourth Amendment, the Fifth
Amendment, the Sixth Amendment, the Seventh Amendment, the Eighth Amendment, the
Letter of Credit Documents, the Security Documents, each Consent and Agreement,
Term Note A, Term Note B, Term Note C, Term Note D, any Revolver Note and any
other documents, agreements or instruments executed and delivered to the Lender
pursuant to Section 6.11."
ARTICLE IV
Conditions to Effectiveness
This Eighth Amendment, and the modifications to the Credit Agreement
provided for herein, shall become effective on the date (the "Eighth Amendment
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Effective Date") on which all of the following conditions have been (or are
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concurrently being) satisfied:
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1. This Eighth Amendment shall have been executed and delivered by each
party hereto.
2. All payments required under Article V, Section 1 of this Eighth Amendment
shall have been paid to the Lender by the Borrower.
3. The Lender shall have received a copy, in form and substance reasonably
satisfactory to the Lender, of the corporate resolutions of the Borrower,
authorizing the revision in the Revolver Borrowing Base and the execution,
delivery and performance of this Eighth Amendment, certified by the Secretary or
an Assistant Secretary of the Borrower as of the Eighth Amendment Effective
Date, which certificates shall state that the resolutions or authorizations
thereby certified have not been amended, modified, revoked or rescinded as of
the date of such certificate.
4. The Lender shall have received a certificate of the Secretary or an
Assistant Secretary of the Borrower, dated the Eighth Amendment Effective Date,
as to the incumbency and signature of the officer(s) of the Borrower executing
this Eighth Amendment and any certificate or other document to be delivered by
it pursuant hereto, together with evidence of the incumbency of such Secretary
or Assistant Secretary.
5. Each of the representations and warranties made by the Borrower in or
pursuant to the Credit Documents shall be true and correct in all material
respects on and as of the Eighth Amendment Effective Date as if made on and as
of such date (except to the extent the same relate to another, earlier date, in
which case they shall be true and correct in all material respects as of such
earlier date).
6. No Default or Event of Default shall have occurred and be continuing.
7. All corporate and other proceedings, and all documents, instruments and
other legal matters in connection with the transactions contemplated by this
Eighth Amendment, the Existing Credit Agreement, the Credit Agreement and the
other Credit Documents shall be reasonably satisfactory in form and substance to
the Lender, and the Lender shall have received such other documents in
respect of any aspect or consequence of the transactions contemplated hereby or
thereby as it shall reasonably request.
8. The Lender shall have received each additional document, instrument,
legal opinion or item of information reasonably requested by the Lender,
including, without limitation, a copy of any debt instrument, security agreement
or other material contract to which the Borrower is to be a party.
ARTICLE V
Miscellaneous
1. Amendment Fee. In connection with this Eighth Amendment, the Borrower
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shall pay to the Lender an amendment fee of $10,000.00.
2. Payment of Expenses. Without limiting its obligations under Section 9.5
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of the Existing Agreement and Section 1 of this Article of this Eighth
Amendment, the Borrower agrees to pay or reimburse the Lender for all of its
reasonable costs and expenses incurred in connection with this Eighth Amendment
and the other Eighth Amendment Documents, including, without limitation, the
reasonable costs, and expenses of Cadwalader, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, counsel to the
Lender, and expressly acknowledge that their obligations hereunder constitute
"Obligations" within the meaning of the Existing Credit Agreement.
3. No Other Amendments; Confirmation. Except as expressly amended, modified
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and supplemented hereby and by the documents related hereto, the provisions of
the Existing Credit Agreement and the other Credit Documents shall remain in
full force and effect.
4. Acknowledgment. The Borrower hereby consents to the execution and
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delivery of this Eighth Amendment and each of the other Eighth Amendment
Documents to which Borrower is a party and reaffirms its obligations under the
Credit Documents.
5. Governing Law; Counterparts. (a) This Amendment and the rights and
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obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York.
(b) This Amendment may be executed by one or more of the parties hereto on
any number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. A set of the
counterparts of this Amendment signed by all the parties shall be lodged with
the Borrower and the Lender. This Amendment may be delivered by facsimile
transmission of the relevant signature pages hereof.
[SIGNATURE PAGE FOLLOWS ]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered as of the day and year first above written.
INTERNATIONAL AIRLINE SUPPORT GROUP, INC.
By
Name:
Title:
BNY FINANCIAL CORPORATION
By
Name:
Title: