Exhibit 10.1

 

FOURTH AMENDMENT TO CREDIT AGREEMENT

 

THIS FOURTH AMENDMENT TO CREDIT AGREEMENT (the “Fourth Amendment”) is made
effective as of May 7, 2004, among PEMCO AVIATION GROUP, INC., a Delaware
corporation, PEMCO AEROPLEX, INC., an Alabama corporation, PEMCO ENGINEERS,
INC., a Delaware corporation, PEMCO WORLD AIR SERVICES, INC., a Delaware
corporation, SPACE VECTOR CORPORATION, a Delaware corporation (collectively, the
“Borrowers”), SOUTHTRUST BANK, an Alabama banking corporation, as Agent (the
“Agent”), SOUTHTRUST BANK, an Alabama banking corporation, as a Lender, and
COMPASS BANK, an Alabama banking corporation, as a Lender. Capitalized terms
used herein but not defined shall have the meanings as set forth in the Credit
Agreement, as amended (as hereinafter defined).

 

WHEREAS, pursuant to that certain Credit Agreement dated as of December 16,
2002, among Borrowers, Agent, and the other Lender Parties a party thereto (the
“Credit Agreement”), Lenders made available, subject to the terms and conditions
thereof, (i) the Revolving Loan of up to $20,000,000.00, (ii) the Swing Line
Loan of up to $5,000,000.00, and (iii) the Term Loan of up to $5,000,000.00; and

 

WHEREAS, pursuant to that certain First Amendment to Credit Agreement dated as
of May 22, 2003, among Borrowers, Agent, and the other Lender Parties a party
thereto (the “First Amendment”), the Credit Agreement was amended in order to
extend to Borrowers the Treasury Stock Loan in the amount of up to
$5,000,000.00; and

 

WHEREAS, pursuant to that certain Second Amendment to Credit Agreement dated as
of November 24, 2003, among Borrowers, Agent, and the other Lender Parties a
party thereto (the “Second Amendment”), the Credit Agreement was amended in
order to (i) temporarily increase the Swing Line Loan Commitment to up to
$7,000,000.00, and (ii) temporarily increase the Revolving Loan Commitment to up
to $22,000,000.00; and

 

WHEREAS, pursuant to that certain Third Amendment to Credit Agreement dated as
of December 16, 2003, among Borrowers, Agent, and the other Lender Parties a
party thereto (the “Third Amendment”), the Credit Agreement was amended in order
to (i) increase the Swing Line Loan Commitment to up to $6,000,000.00, (ii)
increase the Revolving Loan Commitment to up to $25,000,000.00, and (iii) extend
the Revolving Loan Maturity Date from December 16, 2004 until December 16, 2005
(the Credit Agreement, as amended by the First Amendment, the Second Amendment
and the Third Amendment, hereinafter referred to as the “Credit Agreement, as
amended”); and

 

WHEREAS, Lender Parties and Borrowers have agreed to amend the Credit Agreement,
as amended, in order to (i) temporarily increase the Revolving Loan Commitment
to up to $27,000,000.00, and (ii) increase the Letter of Credit Commitment to up
to $1,500,000.00, all as more specifically hereinafter provided.

 

NOW, THEREFORE, in consideration of One Dollar ($1.00) and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree that the Credit Agreement, as amended, is hereby
amended as follows:

 

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1. The Credit Agreement, as amended, is hereby amended by deleting the
definitions of “Letter of Credit Commitment”, “Revolving Loan Commitment” and
“Revolving Notes”, and by substituting the following new definitions,
respectively, in lieu thereof:

 

“Letter of Credit Commitment” means the commitment of Issuing Lender, subject to
the terms of this Agreement, to issue for the account of Borrowers Letters of
Credit in an aggregate amount of up to the lesser of (i) One Million Five
Hundred Thousand and 00/100 Dollars, or (ii) the Unused Revolving Loan
Commitment.

 

“Revolving Loan Commitment” means the commitment of the Revolving Loan Lenders,
subject to the terms of this Agreement, to lend Borrowers up to (A) from May 7,
2004 to August 1, 2004, the lesser of (i) Twenty-Seven Million and 00/100
Dollars ($27,000,000.00), or (ii) the Borrowing Base, less the Available Amount
of the Letters of Credit, less any outstanding Letter of Credit Advances; and
(B) thereafter, the lesser of (i) Twenty-Five Million and 00/100 Dollars
($25,000,000.00), or (ii) the Borrowing Base, less the Available Amount of the
Letters of Credit, less any outstanding Letter of Credit Advances.

 

“Revolving Notes” means (i) that certain Third Amended and Restated Revolving
Note from Borrowers to SouthTrust, dated May 7, 2004, in the principal amount of
$17,280,000.00, and (ii) that certain Second Amended and Restated Revolving Note
from Borrowers to Compass, dated May 7, 2004, in the principal amount of
$9,720,000.00, and includes any amendment to or modification of any such note
and any promissory note given in extension or renewal of, or in substitution
for, such note.

 

2. Borrowers and Lender Parties acknowledge and agree that all of the Collateral
(including, but not limited to, the Mortgaged Property) shall secure all of the
Obligations (including, but not limited to the obligation to pay the principal
of and interest on the Third Amended and Restated Revolving Note from Borrowers
to SouthTrust and the Second Amended and Restated Revolving Note from Borrowers
to Compass), and each Borrower hereby grants, bargains, sells, transfers,
assigns, sets over, conveys, re-grants, re-bargains, re-sells, re-transfers,
re-assigns, re-sets over and re-conveys to Agent, its successors and assigns, a
Lien on, upon and in the Collateral.

 

3. As a condition to the effectiveness of this Fourth Amendment (a) Borrowers
shall have executed and delivered to SouthTrust the Third Amended and Restated
Revolving Note from Borrowers to SouthTrust; (b) Borrowers shall have executed
and delivered to Compass the Second Amended and Restated Revolving Note from
Borrowers to Compass; (c) Borrowers shall have reimbursed Lender Parties for all
of Lender Parties’ fees and expenses, including, but not limited to, any and all
filing fees, recording fees, and expenses and fees of Lender Parties’ legal
counsel, incurred in connection with the preparation of this Fourth Amendment
and any and all documents executed and delivered in connection herewith; (d)
Agent shall have received an opinion of Borrowers’ counsel with respect to the
due authorization, execution and delivery of this Fourth Amendment and the
documents required to be executed and delivered hereunder, and the
enforceability of the Loan Documents, as amended by this Fourth Amendment, such
opinion

 

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letter to be in form and substance acceptable to Agent; (e) Agent shall have
received appropriate resolutions of Borrowers’ directors, in a form satisfactory
to Agent, authorizing Borrowers to enter into this Fourth Amendment and any
other documentation required by Agent in connection with this Fourth Amendment;
(f) Agent shall have received a Bringdown and Incumbency Certificate of each
Borrower, in a form satisfactory to Agent; (g) Borrowers shall have executed and
delivered to Agent all further documents and performed all other acts which
Agent reasonably deems necessary or appropriate to perfect or protect its
security for the Loans; and (h) Borrowers shall have delivered to Agent such
other documentation, if any, as may be requested by Agent to satisfy Agent that
this Fourth Amendment, and all other documents and instruments executed by
Borrowers in connection with this Fourth Amendment or in furtherance hereof have
each been duly authorized, executed and delivered on behalf of Borrowers, and
constitute valid and binding obligations of Borrowers.

 

4. Each Borrower represents and warrants to Lender Parties that all
representations and warranties given by such Borrower in Article IX of the
Credit Agreement, as amended, are true and correct as of the date of this Fourth
Amendment, except to the extent affected by this Fourth Amendment. Each Borrower
represents and warrants to Lender Parties that as of the date of this Fourth
Amendment, such Borrower is in full compliance with all of the covenants of such
Borrower contained in Article X of the Credit Agreement, as amended, except to
the extent affected by this Fourth Amendment.

 

5. Except as heretofore or herein expressly modified, or as may otherwise be
inconsistent with the terms of this Fourth Amendment (in which case the terms
and conditions of this Fourth Amendment shall govern), all terms of the Credit
Agreement, as amended, and all documents and instruments executed and delivered
in furtherance thereof shall be and remain in full force and effect, and the
same are hereby ratified and confirmed in all respects.

 

* * * * *

 

 

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IN WITNESS WHEREOF, this Fourth Amendment has been duly executed as of the day
and year first above written.

 

BORROWERS:

 

PEMCO AVIATION GROUP, INC.

By:   /s/    John R. Lee Its:   Senior Vice President & Chief Financial Officer

 

 

 

PEMCO AEROPLEX, INC.

By:   /s/    John R. Lee Its:   Chief Financial Officer

 

 

 

PEMCO ENGINEERS, INC. By:   /s/    John R. Lee Its:   Chief Financial Officer

 

 

 

PEMCO WORLD AIR SERVICES, INC. By:   /s/    John R. Lee Its:   Chief Financial
Officer

 

 

 

SPACE VECTOR CORPORATION By:   /s/    John R. Lee Its:   Chief Financial Officer

 

 

 

AGENT:

 

SOUTHTRUST BANK, as Agent

By:   /s/    Austin Davis Its:   Vice President

 

 

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LENDERS:

 

SOUTHTRUST BANK

By:   /s/    Austin Davis Its:   Vice President

 

 

COMPASS BANK By:   /s/    Alex Morton Its:   Vice President

 

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