Exhibit 10.14


 


AAR Corp


AAR Receivables Corporation II


1100 North Wood Dale Road


Wood Dale, IL 60191


 


Re:                               Amendment
No. 5 to Receivables Purchase Agreement (this “Amendment”) dated as of March 21,
2003 


 


Gentlemen:


 


AAR Receivables Corporation II, an Illinois
corporation (“Seller”), AAR Corp., a Delaware corporation in its
individual capacity (in such capacity, “AAR”) and as initial servicer
(in such capacity, together with its successors and permitted assigns in such
capacity, “Servicer”), have entered into a certain Receivables Purchase
Agreement dated as of March 21, 2003 (as heretofore amended or otherwise
modified, the “Agreement”; capitalized terms used and not otherwise
defined herein shall have the meanings ascribed to them in the Agreement) with
LaSalle Business Credit, LLC, a Delaware limited liability company
(individually, “LaSalle”), as agent for itself and the Purchasers
referred to below (in such capacity, together with its successors and assigns
in such capacity, “Agent”), and the financial institutions from time to
time parties thereto as “Purchasers.” 
Seller, Servicer, Agent and the Purchasers now desire to further amend
the Agreement as provided herein, subject to the terms and conditions
hereinafter set forth.


 


In addition, AAR executed and delivered a
certain Performance Guaranty dated as of March 21, 2003 (the “Performance
Guaranty”), which Agent and Purchasers require to be reaffirmed as a
condition to the effectiveness hereof.


 


NOW, THEREFORE, in consideration of the
foregoing recitals, the mutual covenants and agreements set forth herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:


 


1.                                       Amendments to
the Agreement.


 


1.1.                              Section 1.1(d) of
the Agreement is hereby deleted in its entirety and is replaced by “[Reserved]”
and all references to Section 1.1(d) of the Agreement in the
Agreement or in any of the other Transaction Documents shall be deemed to be of
no further force or effect.


 

















 


1.2.                              Section 4.4(b) of
the Agreement is hereby amended and restated in its entirety to read as
follows:


 


“On or prior
to 11:00 a.m. (Chicago time) on the fourteenth (14th) Business Day of each
month and at such other times as is requested by the Agent or required
hereunder, the Seller and the Servicer shall deliver to the Agent an
Information Package substantially in the form of that attached hereto as Annex
A (certified therein as true and correct by Chief Financial Officer or
other financial officer of the Servicer) reflecting the information required
therein as of the close of business of the Seller on the last Business Day of
the immediately preceding month (and containing such additional information as
from time to time may be requested by the Agent).”


 


1.3                                 The following
definitions set forth in Exhibit 1 of the Agreement are hereby
amended and restated in their entirety to read as follows:


 


(a)                                  “‘Alternate
Rate’ for any Settlement Period for any Portion of Capital of the Purchased
Interest means an interest rate per annum equal to (a) the sum of (x) the
Applicable Margin plus (y) the Euro-Rate for such Settlement Period; provided,
however, that if (x) it shall become unlawful for any Purchaser to
obtain funds in the London interbank eurodollar market in order to make, fund
or maintain any Purchased Interest, or if such funds shall not be reasonably
available to any Purchaser, or (y) there shall not be at least two (2) Business
Days prior to the commencement of an applicable Settlement Period to determine
Euro-Rate in accordance with its terms, then the “Alternate Rate” shall be
equal to the Base Rate in effect for each day during the remainder of such
Settlement Period or (b) if requested by that Seller the Base Rate for
such Settlement Period; provided, however, that the “Alternate
Rate” for any day while a Termination Event exists shall be an interest rate
equal to 2.00% per annum above the Base Rate otherwise in effect on such day.”


 


(b)                                 “‘Facility
Termination Date’ means the earlier to occur of: (a) March 20, 2009, (b) the
occurrence or declaration of the “Facility Termination Date” pursuant to Section 2.2
of the Agreement and (c) the date the Purchase Limit is terminated or
permanently reduced to zero pursuant to Section 1.1(b) of the
Agreement.”


 


(c)                                  “‘Servicing
Fee’ shall mean the fee referred to in Section 4.8 of  the Agreement.”


 


(d)                                 “‘Servicing
Fee Rate’ shall mean the rate referred to in Section 4.8            of the Agreement.”


 


1.4                                 Exhibit 1
of the Agreement is hereby amended by inserting the following definitions
therein in applicable order:


 


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(a)                                  “‘Applicable
Margin’ means, for any Settlement Period, the rate per annum set forth below
opposite the corresponding level (the ‘Level’) then in effect.


 


	
  Level

  	
   

  	
  Total Debt to EBITDA Ratio

  	
   

  	
  Applicable

  Margin

  	
   

  
	
  I

  	
   

  	
  Greater than or equal to 3.25:1

  	
   

  	
  2.00

  	
  %

  
	
  II

  	
   

  	
  Greater than or equal to 2.25:1 but less
  than 3.25:1

  	
   

  	
  1.75

  	
  %

  
	
  III

  	
   

  	
  Less than 2.25:1

  	
   

  	
  1.50

  	
  %

  



 


The Applicable Margin shall be adjusted, to the extent
applicable, on the fifth (5th) Business Day after the Seller and AAR provide
annual and quarterly financial statements and other information pursuant to Section m(1) or
(m)(2) of Exhibit IV, as applicable, and the related
Officer’s Certificates, pursuant to Section m(3) of Exhibit IV.  Notwithstanding anything contained in this
paragraph to the contrary, (a) if the Seller and/or AAR fail to deliver
such financial statements and Officer’s Certificates in accordance with the
provisions of Sections m(1), m(2) or m(3) of Exhibit IV,
as applicable, the Applicable Margin shall be based upon Level I above
beginning on the date such financial statements and Officer’s Certificates were
required to be delivered until the fifth (5th) Business Day after such
financial statements and/or Officer’s Certificates are actually delivered,
whereupon the Applicable Margin shall be determined by the then applicable
Level; and (b) no reduction to any Applicable Margin shall become
effective at any time when any Termination Event or Unmatured Termination Event
has occurred and is continuing. 
Notwithstanding the foregoing, the initial Applicable Margin from the
date of this Amendment until delivery of the financial statements and related
Officer’s Certificates for the Fiscal Quarter ending May 31, 2006, shall
be based on Level II, whereupon the Applicable Margin shall thereafter be
determined in accordance with the grid as set forth above.”


 


(b)                                 “‘Computation
Period’ means each period of four consecutive fiscal quarters of AAR ending on
the last day of a fiscal quarter of AAR.”


 


(c)                                  “‘Level’
- see the definition of ‘Applicable Margin.’”


 


(d)           “‘Total
Debt’ means the outstanding principal amount of all Debt of AAR and its
consolidated Subsidiaries on a consolidated basis.”


 


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(e)                                  “‘Total
Debt to EBITDA Ratio’ means, as of the last day of any fiscal quarter of AAR,
the ratio of (a) Total Debt as of such day to (b) EBITDA for the
Computation Period ending on such day.”


 


1.5  Clause
(ii) of Section (q) of Exhibit V is hereby
amended and restated in its entirety to read as follows:


 


“(ii)                            Capital
Expenditures of AAR and its Subsidiaries, on a consolidated basis, as
determined as of the last day of each fiscal quarter of AAR for the twelve
fiscal month period ending as of the last day of such fiscal quarter then ended
exceeds $20,000,000; or”


 


2.                                       Reaffirmations
and Representations:


 


2.1.                              AAR expressly hereby
reaffirms, ratifies and assumes all of its obligations and liabilities to Agent
as set forth in the Performance Guaranty. 
AAR further agrees to be bound by and abide by and operate and perform
under and pursuant to and comply fully with all of the terms, conditions,
provisions, agreements, representations, undertakings, warranties, obligations
and covenants contained in the Performance Guaranty, in so far as such
obligations and liabilities may be modified by this Amendment, as though such
Performance Guaranty were being re-executed on the date hereof, except to the
extent that such terms expressly relate to an earlier date.


 


2.2.                              Except as expressly
amended hereby and by any other supplemental documents or instruments executed
by either party hereto in order to effectuate the transactions contemplated
hereby, the Agreement, the Exhibits thereto and other Transaction Documents are
hereby reaffirmed, ratified and confirmed by Seller, AAR and Servicer and
remain in full force and effect in accordance with the terms thereof. Seller,
AAR and Servicer expressly ratify, confirm and reaffirm without condition, all
liens and security interests granted to Agent pursuant to the Agreement and the
other Transaction Documents and to all extensions, renewals, refinancings,
amendments or modifications of any of the foregoing.


 


3.                                       The
effectiveness of this Amendment is subject to the satisfaction of the following
conditions precedent (unless specifically waived in writing by Agent):


 


3.1.                              Agent shall have received
(a) fully executed copies of this Amendment and (b) fully executed
copies of that certain letter agreement dated as of the date hereof (the “Fee
Letter”), by and among Agent, Seller and Servicer, executed by all parties
thereto, together with payment of all fees required to be paid by Seller and/or
AAR on or prior to the date of this Amendment thereunder;


 


3.2.                              All proceedings taken in
connection with the transactions contemplated by this Amendment and all
documents, instruments and other legal matters incident thereto shall be
reasonably satisfactory to Agent;


 


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3.3.                              The representations and
warranties set forth herein and in the Agreement are true and correct in all
material respects with the same effect as if such representations and
warranties had been made on the date hereof; and


 


3.4.                              No event has occurred, is
continuing or would result herefrom that constitutes (a) a Termination
Event or (b) an Unmatured Termination Event.


 


4.                                       This Amendment
may be executed in one or more counterparts, each of which shall constitute an
original, but all of which taken together shall be one and the same instrument.
This Amendment may also be executed by facsimile and each facsimile signature
hereto shall be deemed for all purposes to be an original signatory page.


 


5.                                       This Amendment
shall be construed in accordance with and governed by the internal laws (as
distinguished from the conflicts of law provisions) of the State of Illinois.


 


6.                                       In addition to
the fees payable under the Fee Letter, Seller, AAR and Servicer hereby jointly
and severally agree to reimburse Agent for all of its out-of-pocket legal fees
and expenses incurred in the preparation and documentation of this Amendment
and related documents.


 


7.             On
or after the effective date hereof, each reference in the Agreement to this
Agreement and any reference to the Agreement in any of the other Transaction
Documents shall unless the context otherwise requires, be deemed to refer to
the Agreement as amended hereby.


 


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EXECUTION COPY


 


IN WITNESS WHEREOF, the Parties hereto have
caused this Consent to be executed by their respective officers thereunto as of
the date first written above.


 


 


	
   

  	
  LASALLE BUSINESS CREDIT, LLC,
  as

  Purchaser and as Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ STEVEN FRIEDLANDER

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,
  as

  Purchaser

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ R. MICHAEL NEWTON

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
					



 


 


	
  ACKNOWLEDGED AND AGREED TO

  as of the date and year first above written

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  AAR RECEIVABLES CORPORATION II,

  as Seller

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ MICHAEL K. CARR

  	
   

  	
   

  
	
  Title:

  	
  Assistant Treasurer

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  AAR CORP., as
  Servicer and

  Performance Guarantor

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ MICHAEL K. CARR

  	
   

  	
   

  
	
  Title:

  	
  Vice President