Exhibit 10.1



SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT



THIS SECOND AMENDMENT TO
LOAN AND SECURITY AGREEMENT (this “Amendment”), effective as of September 28, 2012 (the “Amendment
Date”), is by and among precision aerospace components, inc.,a Delaware
corporation(“Parent”), Freundlich
supply company, inc.,a Delaware corporation, tiger-tight corp., a Delaware
corporation, AERO-MISSILE COMPONENTS, INC. (formerly Apace Acquisition I, Inc.),
a Delaware corporation and CREATIVE ASSEMBLY SYSTEMS, INC., (formerly Apace Acquisition II, Inc.), a Delaware corporation (each
a “Borrower” and together with Parent, each an “Obligor” and collectively “Obligors”),
the lenders from time to time party to this Agreement (together with their respective successors and permitted assigns, each individually
a “Lender” and collectively the “Lenders”) and NEWSTAR BUSINESS CREDIT, LLC, a Delaware limited
liability company, as administrative agent (in such capacity, the “Administrative Agent”), as follows:



RECITALS:



A.	Obligors, Lenders and Administrative
Agent are parties to the certain Loan and Security Agreement dated as of May 25, 2012, as amended by the First Amendment to Loan
and Security Agreement dated as of July 27, 2012 (as may be further amended, modified, extended
or renewed from time to time, “Loan Agreement”).



B.	Obligors have requested Administrative
Agent and the Lenders to amend the Loan Agreement in certain respects, and Administrative Agent and the Lenders are willing to
do so, subject to the terms provided by this Amendment



NOW THEREFORE, in consideration
of the premises herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:

ARTICLE
1Definitions

Section
1.1Definitions. Terms defined by the Loan Agreement and not otherwise defined herein shall have the same meanings as
are prescribed by the Loan Agreement.

ARTICLE
2Amendment



Section 2.1Amendment to Section 1.1. Effective as of the Amendment Date, Section 10.14(b) of the Loan Agreement is hereby
amended and restated to read as follows:





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(b)	Leverage
Ratio for Parent and its Subsidiaries of the end of any Fiscal Month, shall not be greater than the amount specified for such date
as follows:

|Date                                    | Maximum Leverage Ratio
|--------------------------------------- | ----------------------
|June 30, 2012                           | 3.40 to 1.0           
|July 31, 2012                           | 3.15 to 1.0           
|August 31, 2012                         | 3.05 to 1.0           
|September 30, 2012                      | 3.50 to 1.0           
|October 31, 2012                        | 3.50 to 1.0           
|November 30, 2012                       | 3.50 to 1.0           
|December 31, 2012                       | 2.70 to 1.0           
|January 31, 2013                        | 2.65 to 1.0           
|February 28, 2013                       | 2.50 to 1.0           
|March 31, 2013                          | 2.35 to 1.0           
|April 30, 2013                          | 2.25 to 1.0           
|May 31, 2013                            | 2.15 to 1.0           
|June 30, 2013 and continuing thereafter | 2.05 to 1.0           



Section 2.1Effective as of the Amendment Date, Schedule 1.1D of the Loan Agreement is hereby amended and restated to in its
entirety to appear as shown attached to this Amendment.

ARTICLE
3

Conditions

Section
3.1Conditions Precedent. The effectiveness of Article 2 of this Amendment is subject to the satisfaction of the
following conditions precedent:

(a)the representations and warranties contained herein and in all other Loan Documents, as amended hereby, shall be true and
correct in all material respects as of the date hereof as if made on the date hereof, except for such representations and warranties
limited by their terms to a specific date;



(b)after giving effect to this Amendment, no Default or Event of Default shall be in existence;

(c)Obligors shall have delivered to Administrative Agent an executed copy of this Amendment, in form and substance satisfactory
to Administrative Agent;

(d)all proceedings taken in connection with the transactions contemplated by this Amendment and all documentation and other
legal matters incident thereto shall be satisfactory to Administrative Agent; and



(e)Obligors shall have paid to Lender the fee required by Section 3.2.

Section
3.2Amendment Fee. Subject to the terms of the Loan Agreement, in consideration of this Amendment, Obligors jointly and
severally agree to pay to Administrative Agent, for the account of the Lenders, an amendment fee in the amount of $10,000, which
amount shall be payable on the Amendment Date.





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ARTICLE
4Ratifications, Representations and Warranties

Section
4.1Ratifications. The terms and provisions set forth in this Amendment shall modify and supersede all inconsistent terms
and provisions set forth in the Loan Agreement and, except as expressly modified and superseded by this Amendment, the terms and
provisions of the Loan Agreement and the other Loan Documents are ratified and confirmed and shall continue in full force and effect.
Obligors, Administrative Agent and the Lenders agree that the Loan Agreement as amended hereby and the other Loan Documents shall
continue to be legal, valid, binding, and enforceable in accordance with their respective terms.

Section
4.2Representations and Warranties. Each Obligor hereby represents and warrants to Administrative Agent and Lenders that
(a) the execution, delivery, and performance of this Amendment and any and all other Loan Documents executed and/or delivered
in connection herewith have been authorized by all requisite action on the part of such Obligor and will not violate the governing
documents of such Obligor and (b) after giving effect to this Amendment, (i) the representations and warranties contained
in the Loan Agreement, as amended hereby, and the other Loan Documents are true and correct on and as of the date hereof as though
made on and as of the date hereof (except to the extent that such representations and warranties were expressly made only in reference
to a specific date), (ii)  no Default or Event of Default has occurred and is continuing, and (iii) Obligors are in full
compliance with all covenants and agreements contained in the Loan Agreement, as amended hereby, and the other Loan Documents.

ARTICLE
5Other Agreements

Section
5.1Survival of Representations and Warranties. All representations and warranties made in this Amendment or any other
Loan Document delivered in connection with this Amendment shall survive the execution and delivery of this Amendment.

Section
5.2Reference to Loan Agreement. Each of the Loan Documents, including the Loan Agreement and any and all other agreements,
documents, or instruments now or hereafter executed and delivered pursuant to the terms hereof or pursuant to the terms of the
Loan Agreement as amended hereby, are hereby amended so that any reference in such Loan Documents to the Loan Agreement shall mean
a reference to the Loan Agreement as amended hereby.

Section
5.3Severability. Any provision of this Amendment held by a court of competent jurisdiction to be invalid or unenforceable
shall not impair or invalidate the remainder of this Amendment and the effect thereof shall be confined to the provision so held
to be invalid or unenforceable.

Section
5.4Successors and Assigns. This Amendment is binding upon and shall inure to the benefit of Obligors, Lenders and Administrative
Agent and their respective successors and assigns, except Obligors may not assign or transfer any of its respective rights or obligations
hereunder without the prior written consent of Administrative Agent.

Section
5.5Counterparts. This Amendment may be executed in one or more counterparts, and on telecopy counterparts each of which
when so executed shall be deemed to be an original, but all of which when taken together shall constitute one and the same agreement.

Section
5.6Ratification. Each Obligor reaffirms its obligations under each of such Loan Documents, as amended hereby, and agrees
that each of the Loan Documents, as amended hereby, remains in full force and effect and is hereby ratified and confirmed.



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Section
5.7Headings. The headings, captions, and arrangements used in this Amendment are for convenience only and shall not
affect the interpretation of this Amendment.

Section
5.8Waiver and Release. In consideration of this agreement, each Obligor represents
and warrants that, as of the date hereof, there are no offsets, defenses or counterclaims against or in respect of its obligations
under the Loan Documents and each Obligor hereby releases and discharges Administrative Agent and each Lender and their respective
agents, employees, successors and assigns, of and from all claims, actions, causes of action, damages, costs, expenses and liabilities,
known or unknown, fixed, contingent or conditional, at law or in equity, in connection with the Loan Documents or any transactions
or acts in connection therewith, in each case existing on or before the date of this Agreement, which such Obligor may have against
any such Person, irrespective of whether any such claims, actions, causes of action, damages, costs, expenses or liabilities are
based on contract, tort or otherwise.

Section
5.9Entire Agreement. This Amendment embodies the final, entire agreement among
the parties hereto relating to the subject matter hereof and supersedes any and all prior agreements, written or oral, relating
to the subject matter of this Amendment. This Amendment may not be contradicted or varied by evidence of prior, contemporaneous,
or subsequent oral agreements or discussions of the parties hereto. There are no oral agreements among the parties.



SIGNATURES FOLLOW

REMAINDER OF PAGE BLANK

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IN WITNESS WHEREOF, the
parties hereto have executed and delivered this Amendment effective as of the date first written above.



OBLIGORS:



precision
aerospace components, inc.





By:	_____________________________________________

Name:	Andrew S. Prince

Title:	President, Chief Executive
Officer and Treasurer





Freundlich
supply company, inc.





By:	_____________________________________________

Name:	Andrew S. Prince

Title:	Chief Executive Officer
and Treasurer





tiger-tight
corp





By:	_____________________________________________

Name:	Andrew S. Prince

Title:	Chief Executive Officer
and Treasurer





AERO-MISSILE COMPONENTS, INC.

(formerly Apace Acquisition I,
Inc.)





By:	_____________________________________________

Name:	Andrew S. Prince

Title:	Chief Executive Officer
and Treasurer





CREATIVE ASSEMBLY SYSTEMS, INC.

(formerly Apace Acquisition II,
Inc.)





By:______________________________________________

Name:	Andrew S. Prince

Title:	Chief Executive Officer
and Treasurer





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ADMINISTRATIVE AGENT:



NEWSTAR BUSINESS CREDIT, LLC

as Administrative Agent





By:	____________________________________________

Name:	Greg Gentry

Title:	Senior Vice President





LENDERS:



NEWSTAR BUSINESS CREDIT, LLC, as
servicer for and on behalf of the Lenders and as servicer for and on behalf of the Swing Lender





By:_____________________________________________

Name: __________________________________________

Title:___________________________________________





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SCHEDULE 1.1D

Extended Term Exceptions



Accounts of a Borrower on which the
Account Debtor is the United States or an agency thereof.

Accounts of a Borrower on which the
Account Debtor is Whirlpool Corp. or any Affiliate thereof that is acceptable to Administrative Agent in its discretion, provided,
that Administrative Agent reserves the right to exclude any such Account Debtor from this Schedule 1.1D at any time in its
discretion, which exclusion shall be effective upon written notice by Administrative Agent to the Borrower Representative.







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