EXHIBIT 2.15
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ELEVENTH AMENDMENT, WAIVER AND AGREEMENT
ELEVENTH AMENDMENT, WAIVER AND AGREEMENT, dated as of January 5, 2001 (this
"Eleventh Amendment"), to the Existing Credit Agreement (as hereinafter
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defined), by and between INTERNATIONAL AIRLINE SUPPORT GROUP, INC., a Delaware
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corporation (the "Borrower"), and GMAC COMMERCIAL CREDIT LLC, a New York limited
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liability company (the "Lender"), as successor in interest by merger to BNY
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FINANCIAL CORPORATION ("BNYFC").
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RECITALS
The Borrower and Lender have entered into the Existing Credit Agreement (as
hereinafter defined), 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, (vii) a $2,000,000 letter of credit facility (viii) a
$5,500,000.00 term loan facility and (ix) a $2,100,000.00 term loan facility,
all of which are secured by accounts receivable, inventory and other collateral
of the Borrower. The Borrower has requested that the Lender (i) consolidate the
outstanding term loan facilities into a single term loan facility, after taking
into account payments made to reduce the current outstanding principal balance
on such term loan facilities, and increase the amount of such consolidated term
loan facility to $10,483,000.00, (ii) waive certain Defaults or Events of
Default arising out of the Borrower's investment in Diamond Aviation, Inc. d/b/a
North-South Airways ("Diamond") and (iii) agree to make certain other amendments
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to the Existing Credit Agreement, including amendments to the Open Purchasing
Revolving Facility and the Borrower's Tangible Net Worth covenant. Subject to
the terms and conditions hereof, the Lender is willing to (i) so consolidate and
increase the term loan facilities, (ii) waive such Defaults and Events of
Default and (iii) make such other amendments requested by the Borrower.
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
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the heading and the recitals to this Eleventh Amendment, the following
definitions shall apply to this Eleventh Amendment:
"Agreement": means the Existing Credit Agreement as amended by this
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Eleventh Amendment.
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"Existing Credit Agreement": means the Credit Agreement, dated as of
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September 30, 1996, between the Borrower and BNYFC, as amended by the First
Amendment, Waiver and Agreement, dated as of March 24, 1997, between the
Borrower and BNYFC, the Second Amendment and Agreement, dated as of September 9,
1997, between the Borrower and BNYFC, the Third Amendment and Agreement, dated
as of October 15, 1997, between the Borrower and BNYFC, the Fourth Amendment and
Agreement, dated as of February 2, 1998, between the Borrower and BNYFC, the
Fifth Amendment and Agreement, dated as of July 16, 1998, between the Borrower
and BNYFC, the Sixth Amendment and Agreement, dated as of May 30, 1998, between
the Borrower and BNYFC, the Seventh Amendment and Agreement, dated as of October
28, 1998, between the Borrower and BNYFC, the Eighth Amendment and Agreement,
dated as of December 8, 1998, between the Borrower and BNYFC, the Ninth
Amendment and Agreement, dated as of July 1, 1999, between the Borrower and BNY
Factoring LLC (now known as GMAC Commercial Credit Corporation), as successor in
interest to BNYFC and the Tenth Amendment and Agreement, dated as of November
17, 1999, between the Borrower and the Lender, as the same may have been further
amended, supplemented or modified from time to time up to but not including the
effectiveness of this Eleventh Amendment.
"Eleventh Amendment Documents": this Eleventh Amendment and any other
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agreements, instruments and documents executed or delivered pursuant to or in
connection with this Eleventh Amendment and the transactions contemplated
thereby.
"Term Loan Aircraft": the collective reference to each of the Airframes,
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Aircraft Engines, and Aircraft Propellers identified as "Term Loan Aircraft" on
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Schedule 1 to this Eleventh Amendment.
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"Term Loan Chattel Mortgage": each of the Aircraft Chattel Mortgages
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identified as "Term Loan Aircraft Chattel Mortgages" on Schedule 1 to this
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Eleventh Amendment.
(b) 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. (a) The Borrower hereby represents and
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warrants as follows:
(i) It (A) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (B) 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, (C) 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 (D) 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.
(ii) It has the power and authority, and the legal right, to make, deliver
and perform this Eleventh Amendment and the other Eleventh 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
Existing Agreement and this Eleventh Amendment and to authorize the execution,
delivery and performance of the Eleventh 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 Eleventh Amendment
Documents to which it is a party. Each Eleventh Amendment Document to which it
is a party has been or will be duly executed and delivered on its behalf. Each
Eleventh Amendment Document to which it is a party when executed and delivered
will constitute its legal, valid and binding obligation, 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.
(iii) The conditions contained in Article V hereof have been satisfied.
(b) The Borrower represents that each of the Credit Documents is on the
date hereof in full force and effect.
ARTICLE III
Amendments to Existing Credit Agreement
1. Amendments to Section 1. (a) Section 1.1 of the Existing
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Credit Agreement is hereby amended by inserting the following new definitions
therein in alphabetical order:
"Eleventh Amendment": that certain Eleventh Amendment and Agreement, dated
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as of January 5, 2001, between the Borrower and the Lender.
"Eleventh Amendment Documents": the Eleventh Amendment, the Replacement Note and
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any other agreements, instruments and documents executed or delivered pursuant
to or in connection with the Eleventh Amendment and the transactions
contemplated thereby.
"Eleventh Amendment Effective Date": the date on which all of the
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conditions precedent to the effectiveness of the Eleventh Amendment set forth in
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Article V of the Eleventh Amendment are first satisfied or waived.
"Embraer Term Loan": as defined in Section 2.3(a) (together with any
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advance made in connection with the substitution of a Term Loan Aircraft, Term
Loan Aircraft Engine or Term Loan Aircraft Propeller pursuant to Section 2.5).
"Embraer Term Loan Borrowing Base": at any time, an amount equal to the lesser
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of (i) the sum of 70% (or such other percentage as the Lender shall determine in
its sole discretion) of the Forced Liquidation Value, after deduction of any
applicable Collateral Reserves, at such time, of each Term Loan Aircraft and
(ii) the sum of the purchase price paid by the Borrower for each Term Loan
Aircraft.
"Embraer Term Loan Facility": at any time, the obligation of the Lender to
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make Term Loan in accordance with the provisions of this Agreement, which shall
not exceed an amount equal to $10,483,000.00 minus the aggregate amount of
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repayments of principal then required to have been made in accordance with
Schedule 2.3(a).
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"Embraer Term Note": a promissory note of the Borrower evidencing the
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Embraer Term Loan, in form and substance acceptable to the Lender.
"Term Loan Aircraft": each Aircraft owned from time to time by the Borrower
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and listed as a Term Loan Aircraft and described on Schedule I hereto, as the
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same may be amended or modified from time to time in accordance with this
Agreement.
"Term Loan Aircraft Chattel Mortgage": each Aircraft Chattel Mortgage from the
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Borrower to the Lender with respect to Term Loan Aircraft identified on Schedule
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I hereto as the same may be amended or modified from time to time in accordance
with this Agreement
"Term Loan Aircraft Engine": each Aircraft Engine owned from time to time by the
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Borrower and listed as a Term Loan Aircraft Engine and described on Schedule I
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hereto, as the same may be amended or modified from time to time in accordance
with this Agreement.
"Term Loan Aircraft Propeller": each Aircraft Propeller owned from time to time
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by the Borrower and listed as a Term Loan Aircraft Propeller and described on
Schedule I hereto, as the same may be amended or modified from time to time in
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accordance with this Agreement.
(b) The definition of the term "Approved Aircraft" in Section 1.1 of the
Existing Credit Agreement is hereby deleted in its entirety and replaced by the
following:
""Approved Aircraft": means the collective reference to the Term Loan
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Aircraft Engines, the Term Loan Aircraft Propellers and the Term Loan Aircraft."
(c) The definition of the term "Credit Documents" in Section 1.1 of the
Existing Credit Agreement is hereby deleted in its entirety and replaced by the
following:
""Credit Documents": this Agreement, the First Amendment, the Second
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Amendment, the Third Amendment, the Fourth Amendment, the Fifth Amendment, the
Sixth Amendment, the Seventh Amendment, the Eighth Amendment, the Ninth
Amendment, the Tenth Amendment, the Eleventh Amendment, the Letter of Credit
Documents, the Security Documents, each Consent and Agreement, the Embraer Term
Note, any Revolver Note, any Subsidiary Guarantee and any other documents,
agreements or instruments executed and delivered to the Lender pursuant to
Section 6.11."
(d) The definition of the term "Facilities" in Section 1.1 of the Existing
Credit Agreement is hereby amended by deleting the words "Term Loan Facilities"
and replacing the words "Embraer Term Loan Facility".
(e) The definition of "Revolver Reserve" in Section 1.1 of the Existing
Credit Agreement is hereby deleted in its entirety and replaced by the
following:
""Revolver Reserve": as of any date, an amount equal to the lesser of (i) the
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amount, if any, by which the sum determined in accordance with clause I of the
definition of Revolver Borrowing Base on such date exceeds the aggregate
outstanding Revolver Advances on such date and (ii) the amount, if any, by which
the sum of the Embraer Term Loan Facility (without regard to any Embraer Term
Loan borrowings made prior to or on such date) on such date, on such date
exceeds the Embraer Term Loan Borrowing Base on such date."
(f) The definition of "Termination Date" in Section 1.1 of the Existing
Agreement is hereby deleted in its entirety and replaced by the following:
""Termination Date": December 31, 2005."
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(f) The definition of "Term Loan Borrowing Bases" in Section 1.1 of the
Existing Credit Agreement is hereby deleted in its entirety and replaced by the
following:
""Term Loan Borrowing Base": the Embraer Term Loan Borrowing Base."
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(g) The definition of "Term Loan Facilities" in Section 1.1 of the Existing
Credit Agreement is hereby deleted in its entirety and replaced by the
following:
""Term Loan Facility": the Embraer Term Loan Facility."
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(h) The definition of "Term Loans" in Section 1.1 of the Existing Credit
Agreement is hereby deleted in its entirety and replaced by the following:
""Term Loan": the Embraer Term Loan.
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(i) The definition of "Term Loan A" is hereby deleted in its entirety and
replaced by the following:
""Term Loan A": shall have the meaning set forth in the Existing
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Agreement."
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(j) The definition of "Term Loan E" is hereby deleted in its entirety and
replaced by the following:
""Term Loan E": shall have the meaning set forth in the Existing
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Agreement."
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(k) The definition of "Term Loan F" is hereby deleted in its entirety and
replaced by the following:
""Term Loan F": shall have the meaning set forth in the Existing
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Agreement."
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(l) The following defined terms and their related definitions are hereby deleted
in their entirety: Term Loan B, Term Loan B Aircraft, Term Loan B Aircraft
Chattel Mortgage, Term Loan B Aircraft Engine, Term Loan B Borrowing Base, Term
Loan B Facility, Term Note B, Term Loan C, Term Loan C Aircraft, Term Loan C
Aircraft Chattel Mortgage, Term Loan C Aircraft Engine, Term Loan C Borrowing
Base, Term Loan C Facility, Term Note C, Term Loan D, Term Loan D Aircraft, Term
Loan D Aircraft Chattel Mortgage, Term Loan D Aircraft Engine, Term Loan D
Borrowing Base, Term Loan D Facility, Term Note D.
2. Amendments to Section 2.1. Paragraph (b) of Section 2.1 is
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hereby deleted in its entirety and replaced by the following:
(b) Subject to the terms and conditions hereof, the Lender agrees in its
reasonable discretion to make revolving credit loans ("Open Purchasing Revolver
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Advances") to the Borrower from time to time during the period commencing with
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and including the Fourth Amendment Effective Date and ending with the
termination of this Agreement in an aggregate principal amount at any one time
outstanding not to exceed the Open Purchasing Revolver Facility. During the
term of this Agreement the Borrower may use the Open Purchasing Revolver
Facility by borrowing, prepaying the Open Purchasing Revolver Advances in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof. The Open Purchasing Revolver Advances may from time to time be (i)
LIBOR Loans, (ii) ABR Rate Loans, or (iii) a combination thereof, as determined
by the Borrower and notified to the Lender in accordance with Sections 2.2, 3.1
and 3.14, provided that no Open Purchasing Revolver Advances shall be made as a
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LIBOR Loan after the day that is one month prior to the Termination Date. Any
Open Purchasing Revolver Advance that remains outstanding in excess of ninety
(90) days from the date such advance is made shall mature in equal monthly
installments payable on the last day of the month with a final maturity date
that is twenty-four (24) months after the date such Open Purchasing Revolver
Advance is made by the Lender (such an advance, an "Open Purchasing Revolver
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Amortizing Advance"). On any date that an Open Purchasing Revolver Amortizing
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Advance is outstanding, the Open Purchasing Revolver Facility shall be reduced
by an amount equal to such outstanding Open Purchasing Revolver Amortizing
Advance on such date."
3. Amendments to Section 2.3. Section 2.3 of the Existing Credit
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Agreement is hereby deleted in its entirety and replaced by the following:
"2.3 Term Loan Facility. (a) Each of the parties hereto hereby acknowledges
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and agrees that the Lender's commitments to make Term Loan A, Term Loan E and
Term Loan F pursuant to the Existing Credit Agreement have been fully funded.
Subject to the terms and conditions hereof, the Lender hereby agrees to
consolidate Term Loan A, Term Loan E and Term Loan F into a single term loan
(referred to herein as the "Embraer Term Loan"). The Embraer Term Loan shall be
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in the principal amount of the lesser of (a) the Embraer Term Loan Facility on
such date and (b) the Embraer Term Loan Borrowing Base on such date.
(b) Subject to the terms and conditions hereof, on the Eleventh Amendment
Effective Date the Lender agrees to make an additional discretionary advance
under the Embraer Term Loan in an amount equal to $4,593,000.00 (such additional
advance, together with all amounts previously advanced in connection with the
Embraer Term Loan and, together with all advances made in connection with the
substitution of Term Loan Aircraft or Term Loan Engines pursuant to Section 2.5
hereof, shall be included as part of the Embraer Term Loan). The Embraer Term
Loan shall be stated to mature in the installments and amounts payable on the
dates set forth in Schedule 2.3(a) hereto, and bear interest on the unpaid
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principal amount thereof at the applicable interest rates per annum specified in
Section 3.1 it being understood and agreed that notwithstanding anything to the
contrary in said Schedule 2.3(a), if the Termination Date shall occur prior to
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the final maturity date set forth therein, then all amounts owing under the
Embraer Term Loan, including accrued interest, shall become due and payable on
such Termination Date. All payments of principal thereof shall reduce the
Embraer Term Loan Facility on a dollar-for-dollar basis."
4. Amendments to Section 2.5. Section 2.5 of the Existing Credit
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Agreement is hereby deleted in the entirety and replaced by the following:
"2.5 Discretionary Term Loan Advance Upon Substitution of Approved
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Aircraft. At the request of the Borrower and after substitution of a Term Loan
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Aircraft, a Term Loan Aircraft Engine or a Term Loan Propeller (the "Substitute
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Term Loan Aircraft, Engine or Propeller") for a Term Loan Aircraft, a Term Loan
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Aircraft Engine or a Term Loan Propeller which has been sold or has suffered an
Event of Loss within six months after repayment of Embraer Term Loan to the
extent and as required by Section 3.3(d) hereof, the Lender in its sole
discretion may make an advance in an amount equal to the lesser of (i) 70% (or
such other percentage as the Lender shall determine in its sole discretion) of
the Forced Liquidation Value of the Substitute Term Loan Aircraft, Engine or
Propeller, less any applicable Collateral Reserve, and (ii) the amount, if any,
by which (A) $10,483,000.00 minus all repayments of principal made, or required
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to have been made on or prior to the date of such advance in accordance with
Schedule 2.3(a) hereto exceeds (B) the outstanding principal balance of the
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Embraer Term Loan on such date (prior to the making of such advance) and (iii)
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the purchase price paid by the Borrower for the Substitute Term Loan Aircraft,
Engine or Propeller. Each such advance, if any, shall be made in the sole and
absolute discretion of the Lender and shall be deemed to comprise part of the
Embraer Term Loan for all purposes hereunder and shall increase the Embraer Term
Loan Facility on a dollar-for-dollar basis. From and after the making of such
advance the outstanding principal balance of the Embraer Term Loan shall include
the amount of such advance, interest shall be payable on such amount, and the
amount of each remaining scheduled principal repayment shall be increased by an
amount equal to (x) the amount of such advance times (y) a fraction the
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numerator of which is an amount equal to such scheduled principal repayment and
the denominator of which is the aggregate amount of all remaining scheduled
principal repayments."
5. Amendments to Section 3.2(b). Section 3.2(b) of the Existing
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Credit Agreement is hereby deleted in its entirety and replaced by the
following:
"(b) The Borrower may at any time and from time to time prepay the Embraer
Term Loan, in whole or in part, without premium or penalty after giving to the
Lender notice, which must be received by the Lender no later than 12:00 noon,
New York City time on the date of such prepayment and which must specify the
date and amount of prepayment. If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified therein
and the amount of such payments shall reduce the Embraer Term Loan Facility on a
dollar-for-dollar basis and shall be applied against scheduled repayments of
principal so that each remaining scheduled principal repayment shall be
decreased by an amount equal to (x) the amount of such prepayment times (y) a
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fraction the numerator of which is an amount equal to such scheduled principal
repayment and the denominator of which is the aggregate amount of all remaining
scheduled principal repayments."
6. Amendments to Section 3.3. (a) Paragraph (b) of Section 3.3 of
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the Existing Credit Agreement is hereby deleted in its entirety and replaced by
the following:
"(b) (i) If on any date on which a Borrowing Base Certificate is required
to be delivered pursuant to Section 6.2(c), the aggregate outstanding principal
amount of the Embraer Term Loan exceeds an amount equal to the Embraer Term Loan
Borrowing Base and the Revolver Reserve, the Borrower shall immediately prepay
the Embraer Term Loan in an amount equal to the amount of such excess. The
amount of such payment shall reduce the Embraer Term Loan Facility on a
dollar-for-dollar basis against scheduled repayments of principal on a pro rata
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basis."
(b) Paragraph (e) of Section 3.3 of the Existing Credit Agreement is hereby
deleted in its entirety and replaced by the following:
"(e) Unless the Lender otherwise agrees, the Borrower shall prepay the
Revolver Advances and deposit cash collateral in respect of the Letter of Credit
Liabilities in accordance with paragraph (f) of this Section 3.3 in an aggregate
amount equal to 100% of the Net Proceeds of any sale, lease, assignment,
exchange or other disposition for cash of any asset or group of assets
(including, without limitation, insurance proceeds paid as a result of any
destruction, casualty or taking of any property of the Borrower or any
Subsidiary), other than Approved Aircraft and the Real Estate of the Borrower or
any Subsidiary upon which its principal executive offices are located on the
Closing Date, not made in the ordinary course of business by the Borrower or any
Subsidiary of the Borrower, in any such case no later than three Business Days
following receipt by the Borrower or such Subsidiary of such proceeds, together
with accrued interest to such date on the amount prepaid; provided that no such
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prepayment or cash collateral deposit shall be required pursuant to this Section
3.3(e) unless the aggregate amount of such Net Proceeds received by the Borrower
and its Subsidiaries, and not previously applied to prepayment of the Revolver
Advances is at least $100,000. Nothing in this Section 3.3(e) shall be
construed to derogate any restriction or limitation contained in any Credit
Document imposed on any transaction of the types described in this Section
3.3(e), including without limitation the restrictions set forth in Sections 7.2,
7.5 and 7.6 hereof."
7. Amendments to Section 3.5(e). The THIRD and FOURTH enumerated
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paragraphs of Section 3.5(e) of the Existing Credit Agreement are hereby deleted
in their entirety and replaced by the following:
"THIRD, to the payment in full of the outstanding principal of the Revolver
Advances and, upon the occurrence and during the continuance of an Event of
Default, at the option of the Lender, to the payment in full of the outstanding
principal of the Embraer Term Loan;
FOURTH, to the payment in full of all other Obligations then due and
payable (including, without limitation, any installment of principal of either
or both of the Embraer Term Loan then due and payable); and"
8. Amendments to Section 3.5(f). Clauses (ii) and (iii) of
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Section 3.5(f) of the Existing Credit Agreement are hereby amended by deleting
the term "Term Loan Borrowing Bases" wherever it occurs therein and replacing it
with the term "Term Loan Borrowing Base" in each such case.
9. Amendments to Section 3.5(g). Section 3.5(g) of the Existing
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Credit Agreement is hereby deleted in its entirety and replaced by the
following:
"(g) The Borrower agrees that, upon the request of the Lender, the Borrower
will execute and deliver to the Lender (i) a promissory note of the Borrower
evidencing the Embraer Term Loan of the Lender, in form and substance acceptable
to the Lender (the "Embraer Term Note"), (ii) a promissory note of the Borrower
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evidencing the Revolver Advances of the Lender in form and substance acceptable
to the Lender (a "Revolver Note"), and/or (iii) a promissory note of the
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Borrower evidencing the Open Purchasing Revolver Advances of the Lender in form
and substance acceptable to the Lender (an "Open Purchasing Revolver Note")."
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10. Amendments to Section 6.2. Paragraph (c) of Section 6.2 is
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hereby deleted in its entirety and replaced by the following:
"(c) prior to 2:00 p.m., New York City time on each Business Day, a
Borrowing Base Certificate showing the Revolver Borrowing Base and the Embraer
Term Loan Borrowing Base, (but only, in the case of the Embraer Term Loan
Borrowing Base, in connection with the delivery of the first such certificate
hereunder and in each case that the Embraer Term Loan Borrowing Base changes
from the amount thereof most recently reported, certified as complete and
correct by a Responsible Officer or any vice president on behalf of the
Borrower, which Borrowing Base Certificate shall disclose daily updates of the
amount of Eligible Accounts and Eligible Lease Payment Receivables, weekly
updates of the amount of Eligible Inventory and the Forced Liquidation Value of
Approved Aircraft when required;".
11. Amendments to Section 7.1. Paragraph (a) of Section 7.1 is
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hereby deleted in its entirety and replaced by the following:
"(a) Maintenance of Tangible Net Worth. Permit Consolidated Tangible
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Net Worth of the Borrower at the end of each fiscal quarter to be (after giving
effect to the transactions contemplated hereunder) the amount set forth opposite
such fiscal quarter:
Period Amount
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Fiscal quarter ending November 2000 $9,257,000
Fiscal quarter ending February 2001 $9,995,000
Fiscal quarter ending May 2001 $10,846,000
Fiscal quarter ending August 2001 $11,481,000
<PAGE>
Each fiscal quarter ending after August 2001 through November 2005
The amount required by this covenant for the immediately preceding fiscal
quarter plus 50% of Borrower's net profit after tax (as defined by GAAP) for
every quarter thereafter."
12. Amendments to Section 8. Section 8 of the Existing Credit
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Agreement is hereby amended by adding the following:
"(j) A "Change of Control" (as defined below) of the Borrower, without
the consent (which may be given after the occurrence of the event alleged to
constitute a Change of Control) of the Board of Directors (as defined below) and
the Lender, shall occur. As used herein, a "Change of Control" means:
(i) a "person" or "group" (within the meaning of Sections 13(d)
and 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act""))
becomes, is determined by the Board of Directors of the Borrower (acting in good
faith) to be, or files a report on Schedule 13D or 14D-2 (or any successor
schedule, for or report) disclosing that such person or group is the ultimate
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of more
than twenty-five percent (25%) of the total number of shares of voting stock of
the Borrower then outstanding;
(ii) individuals who on the date hereof constitute the board of
directors (together with any new directors who were appointed to the board of
directors by individuals who, on the date hereof, constitute the board of
directors or whose nomination for election to the board of directors was
approved by the then incumbent Chairman of the board of directors and
disregarding any Director who resigned from the board of directors in the
ordinary course of business) (the "Board of Directors") cease for any reason to
constitute at least seventy-five percent (75%) of the members of the Board of
Directors then in office;
(iii) the sale of all or substantially all of the Borrower's
assets in one transaction or a series of related transactions to any person or
group;
(iv) the Borrower is merged, consolidated or reorganized into or
with another corporation or other legal person, or securities of the Borrower
are exchanged for securities of another corporation or other legal person, and
immediately after such merger, consolidation, reorganization or exchange less
than fifty percent (50%) of the combined voting power of the then-outstanding
securities of such corporation or person immediately after such transaction are
held, directly or indirectly, in the aggregate by the holders of securities
entitled to vote generally in the election of the members of the board of
directors of the Borrower immediately prior to such transaction;
(v) the stockholders of the Borrower shall take any action in
contemplation of the liquidation or dissolution of the Borrower; or
(vi) any other transaction or series of related transactions
occur that have substantially the effect of the transactions specified in any of
the preceding clauses in this sentence."
13. Amendments to Schedule I. Schedule I to the Existing Credit
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Agreement is hereby amended in its entirety to read as is set forth on Schedule
I hereto.
14. Amendments to Schedule 1.1. Schedule 1.1 to the Existing Credit
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Agreement is hereby amended in its entirety to read as is set forth on Schedule
1.1 hereto.
15. Amendments to Schedules 2.3A, 2.3B, 2.3C, 2.3D and 2.3E.
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Schedules 2.3A, 2.3B, 2.3C, 2.3D, 2.3E and 2.3F are hereby deleted in their
entirety and replaced by Schedule 2.3(a) hereto.
ARTICLE IV
Waiver and Consent
1. Waiver and Consent. The Lender hereby waives any Default or
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Event of Default arising as a result of the failure by the Borrower to comply
with or to satisfy the requirements of Section 7.9 of the Existing Credit
Agreement but only with respect to its $1,300,000.00 investment in Diamond and
consents to such $1,300,000.00 investment in Diamond.
ARTICLE V
Conditions to Effectiveness
This Eleventh Amendment, and the modifications to the Credit Agreement
provided for herein, shall become effective on the date (the "Eleventh 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. Each of the Eleventh Amendment Documents shall have been
executed and delivered by each party thereto.
2. The Lender shall have received executed legal opinions of King
& Spalding special counsel to the Credit Parties, in form and substance
satisfactory to the Lender and taking into account this Eleventh Amendment and
the matters contemplated hereby (including, without limitation, opinions with
respect to the validity of the Eleventh Amendment Documents and the
effectiveness of UCC filings in each state where Collateral described therein is
located). Such legal opinion shall cover such matters incident to the
transactions contemplated by this Eleventh Amendment and the other Eleventh
Amendment Documents as the Lender may reasonably require.
3. The Lender shall have received the executed legal opinion of Crowe &
Dunlevy, special FAA counsel to the Borrower, in form and substance satisfactory
to the Lender taking into account this Eleventh Amendment and the matters
contemplated hereby. Such legal opinion shall cover such matters incident to
the transactions contemplated by this Eleventh Amendment and the other Eleventh
Amendment Documents as the Lender may reasonably require.
4. 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 execution, delivery and performance of this Eleventh
Amendment and the other Eleventh Amendment Documents to which the Borrower is a
party, certified by the Secretary or an Assistant Secretary of the Borrower as
of the Eleventh 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.
5. The Lender shall have received a certificate of the Secretary
or an Assistant Secretary of the Borrower, dated the Eleventh Amendment
Effective Date, as to the incumbency and signature of the officer(s) of the
Borrower and of Diamond executing each Eleventh Amendment Document to which it
is a party 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.
6. The Lender shall have received true, correct and complete copies of
the Governing Documents of the Borrower, certified as of the Eleventh Amendment
Effective Date, as true, correct and complete copies thereof by the Secretary or
an Assistant Secretary of the Borrower.
7. The Lender shall have received copies of certificates dated as of a
recent date from the Secretary of State or other appropriate authority of such
jurisdiction, evidencing the good standing of the Borrower in the State of its
organization and in each State where the ownership, lease or operation of
property or the conduct of business requires it to qualify as a foreign
corporation or other entity except where the failure to so qualify would not
have a Material Adverse Effect.
8. 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 Eleventh 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).
9. No Default or Event of Default shall have occurred and be continuing
other than as contemplated and waived by this Eleventh Amendment.
10. All corporate and other proceedings, and all documents, instruments and
other legal matters in connection with the transactions contemplated by the
Eleventh Amendment Documents, 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.
11. The Lender shall have received in form and substance satisfactory to it
that all of the requirements of Section 6.6 of the Existing Credit Agreement
shall have been satisfied with respect to the Term Loan Aircraft.
12. The Lender shall have received evidence in form and substance
satisfactory to it that all filings, recordings, registrations and other
actions, including, without limitation, the filing of financing statements on
forms UCC-1, necessary or, in the reasonable opinion of the Lender, desirable to
perfect the Liens created by the Security Documents with respect to the Term
Loan Aircraft shall have been completed.
13. The Borrower shall have acquired the Term Loan Aircraft free and clear
of all Liens.
14. 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 a party.
ARTICLE VI
Miscellaneous
1. Closing Fee; Payment of Expenses. (a) On the Eleventh
------------------------------------
Amendment Effective Date, the Borrower shall pay to the Lender in immediately
available funds a fee equal to $75,000.00 (which shall be in addition to all
fees paid to the Lender prior to the execution and delivery of this Eleventh
Amendment). The Lender is hereby authorized to withhold the amount of such fee
from the proceeds of the Embraer Term Loan.
(b) Without limiting its obligations under Section 9.5 of the
Existing Agreement, the Borrower agrees to pay or reimburse the Lender for all
of its reasonable costs and expenses incurred in connection with this Eleventh
Amendment and the other Eleventh Amendment Documents, including, without
limitation, the reasonable costs and expenses of Cadwalader, Wickersham & Taft,
counsel to the Lender and expressly acknowledge that their obligations hereunder
constitute "Obligations" within the meaning of the Existing Credit Agreement.
2. No Other Amendments; Confirmation. Except as expressly amended,
------------------------------------
modified 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.
3. Acknowledgment. The Borrower hereby acknowledges that each Term
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Loan Aircraft Chattel Mortgage constitutes an Aircraft Chattel Mortgage under
the Agreement.
4. Affirmation by Borrower. The Borrower hereby consents to the
-------------------------
execution and delivery of this Eleventh Amendment and each of the other Eleventh
Amendment Documents to which it is a party and the Borrower reaffirms its
obligations under the Credit Documents.
5. Governing Law; Counterparts. (a) This Eleventh Amendment and the
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rights and obligations of the parties hereto shall be governed by, and construed
and interpreted in accordance with, the laws of the State of New York, without
regard to conflicts of laws principles and the parties hereto irrevocably and
unconditionally waive trial by jury in any legal action or proceeding relating
hereto.
(b) This Eleventh 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 Eleventh Amendment signed by all
the parties shall be lodged with the Borrower and the Lender. This Eleventh
Amendment may be delivered by facsimile transmission of the relevant signature
pages hereof.
[SIGNATURE PAGE FOLLOWS ]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Eleventh Amendment
to be duly executed and delivered as of the day and year first above written.
INTERNATIONAL AIRLINE SUPPORT GROUP, INC.
By ____________________________________
Name:
Title:
GMAC COMMERCIAL CREDIT LLC,
as successor in interest by merger to BNY Financial Corporation
By ____________________________________
Name:
Title:
<PAGE>
