FIRST AMENDMENT TO SECOND AMENDED AND RESTATED
               SENIOR SUBORDINATED LOAN AGREEMENT


     This First Amendment to Second Amended and Restated Senior
Subordinated Loan Agreement (the "Amendment") is entered into as of
August 8, 1997 between Precision Standard, Inc. (the "Company") and
Bank of America NT&SA (the "Bank").  This Amendment amends certain
provisions of that certain Second Amended and Restated Senior
Subordinated Loan Agreement dated as of December 31, 1996 (the
"Agreement").  Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to them in the
Agreement.

     In consideration of the mutual promises herein contained, the
parties hereto agree as follows:

1.   Amendments.  Subject to the fulfillment of the conditions set
forth in Section 3 below, the Agreement is hereby amended as
follows:

     1.1  Section 1.1 is amended to add the following definitions:

          ""BNY Credit Agreement" means that certain Accounts 
     Receivable Management and Security Agreement dated of even
     date herewith entered into among BNY Financial Corporation,
     the Company and certain affiliates of the Company."

          ""BNY Termination Date" means the date any commitment to
     extend credit pursuant to the BNY Credit Agreement, as it may
     be amended from time to time, has, or has been, terminated,
     and all indebtedness pursuant to the BNY Credit Agreement has
     been paid in full."

          ""First Amendment Effective Date" means the date all 
     conditions described in Section 3 of the First Amendment
     hereto have been satisfied."

          ""Installment Date" means each of five following dates:

     (1)  the earlier to occur of (i) the BNY Termination Date, or
     (ii) August 31, 2000;

     (2)  the earlier to occur of (i) the date one month after the
     BNY Termination Date, or (ii) September 30, 2000;

     (3)  the earlier to occur of (i) the date four months after
     the BNY Termination Date, or (ii) December 31, 2000;

     (4)  the earlier to occur of (i) the date seven months after
     the BNY Termination Date, or (ii) March 31, 2001; and

     (5)  the earlier to occur of (i) the date ten months after the
     BNY Termination Date, or (ii) June 30, 2001."

     1.2  Section 2.2 is amended to read in its entirety as
follows:

          "2.2  Repayment.  The balance of the Loan shall be repaid
     (a) with a $500,000 principal installment paid on the first
     Amendment Effective Date and, thereafter, (b) in five
     additional installments, payable on each Installment Date,
     each in the amount of 20% of the unpaid principal balance of
     the Loan immediately after the First Amendment Effective Date. 
     Notwithstanding the foregoing, any remaining unpaid principal
     amount of the indebtedness outstanding hereunder together with
     any other obligations arising hereunder which have not
     previously been paid shall be paid in full no later than the
     Maturity Date."

     1.3  Subsection 2.3(c) is amended to read in its entirety as
follows:

          "(c)  Any interest accrued hereunder after October 1, 
     1996 until and including July 31, 1997 shall be payable on the
     last day of each calendar month beginning on October 31, 1996
     and continuing until July 31, 1997.  On the First Amendment
     Effective Date the Company shall make a prepayment of interest
     on the Loan in the amount of $281,388.41.  Such prepaid
     interest shall be applied to interest as interest accrues at
     the rates provided in subsection (b) above on a monthly basis
     provided, that there shall be no interest discount, reduction
     or rebate as a result of the early payment.  Interest accrued
     hereunder shall recommence to be paid on the last day of each
     calendar quarter beginning on the last day of the first
     calendar quarter in which the prepayment is insufficient to
     pay such interest in full.  Any accrued interest remaining
     unpaid on the date the Loan is repaid in full shall be due and
     payable on such date."

     1.4  Section 5.2 is amended to read in its entirety as
follows:

               "5.2.  Certificates; other Information.  The Company
     shall furnish to the Lender:

          (a)  concurrently with the delivery of the financial
     statements referred to in Section 5.1(a) above, a certificate
     of the independent certified public accountants reporting on
     such financial statements stating that in making the
     examination necessary therefor no knowledge was obtained of
     any Default or Event or Default, except as specified in such
     certificate;

          (b)  not later than forty-five (45) days after the end of
     each fiscal quarter, a certificate of a Responsible Officer
     (i) stating that, to the best of such officer's knowledge, the
     Company, during such quarter, has observed or performed all of
     its covenants and other agreements, and satisfied every
     condition, contained in this Agreement to be observed,
     performed or satisfied by it, and that such officer has
     obtained no knowledge of any Default or Event of Default
     except as specified in such certificate, and (ii) showing in
     detail the calculations supporting compliance with the
     financial covenants in the BNY Credit Agreement;

          (c)  as soon as available but in any event not later 
     than ten (10) days after the end of each month, a borrowing
     base compliance certificate in the form of Exhibit C hereto;

          (d)  as soon as available but in any event not later than
     thirty (30) days after the end of each fiscal year, annual
     projections by quarter of the budgeted financial statements of
     the Company and its Subsidiaries;

          (e)  as soon as available but in any event not later than
     one hundred twenty (120) days after the end of each fiscal
     year, copies of all management letters issued by the Company's
     independent public accountants with respect to such year;

          (f)  promptly after the same are sent, copies of all 
     financial statements and reports which the Company sends to
     its stockholders, and promptly after the same are filed,
     copies of all financial statements and regular, periodical or
     special reports which the Company may make to, or file with,
     the Securities and Exchange Commission or any successor or
     analogous Governmental Authority regulating securities;

          (g)  as soon as available, a copy of any offering 
     memorandum, term sheet, prospectus or similar document used,
     or intended to be used, by the Company to arrange for debt or
     equity financing of any kind; and

          (h)  promptly, such additional financial and other 
     information as the Lender may from time to time reasonably
     request."

     1.5  Sections 5.3, 5.4, 5.5, 5.6, 5.7 and 5.11 are hereby 
     deleted and the respective section numbers are reserved for
     future use.

     1.6  All of Article VI except for Section 6.9 is hereby
deleted.  Section 6.9 is hereby renumbered as Section 6.1.

     1.7  Subsection 7.1(b) is amended by changing the phrase "20
days" to "10 days".

     1.8  Subsection 7.1(c) is amended to read in its entirety as
follows:

          "(c) Any representation or warranty made by the Company
     herein shall prove to have been incorrect in any material
     respect when made; or"

     1.9  Subsection 7.1(d) is amended to read in its entirety as
follows:

          "(d) The Company shall fail to observe (i) Section 6.1
     hereof, or after the BNY Termination Date, any provision of
     Article VIII hereof, and such failure shall remain unremedied
     for 10 days after written notice thereof shall have been given
     to the Company by the Lender, or (ii) any other term, covenant
     or agreement contained in this Agreement or any other Loan
     Document on its part to be performed or observed, and such
     failure shall remain unremedied for 30 days after written
     notice thereof shall have been given to the Company by the
     Lender; or"

     1.10  Subsection 7.1(e) is amended to read in its entirety as
follows:

          "(e) Any Event or Default (as such term is defined in the
     BNY Credit Agreement, or any successor thereto) shall have
     occurred and be continuing unwaived; or

     1.11  Subsections (g), (h) and (i) of Section 7.1 are hereby
     deleted.  Subsection (j) of Section 7.1 is hereby re-lettered
     as subsection (g).

     1.12  Existing Article VIII of the Agreement is hereby
deleted.  Article VIII shall instead read in its entirety as
follows:

                          "ARTICLE VIII
                   INCORPORATION BY REFERENCE

          On the BNY Termination Date, Paragraphs 8 through 12 of
     the BNY Credit Agreement and the related definitional
     provisions set forth elsewhere in the BNY Credit Agreement
     (all as in effect on the date of the First Amendment hereto)
     shall be deemed incorporated herein as Article VIII of this
     Agreement.  Any reference to the "Borrowers" shall be deemed
     a reference to the Company and the Subsidiaries."

2.   Representations and Warranties.  The Company hereby represents
and warrants to the Bank that, as of the First Amendment Effective
Date:

     2.1  No Event of Default specified in the Agreement and no
event which with notice or lapse of time or both would become such
an Event of Default has occurred and is continuing other than as
has been specifically waived hereby;

     2.2  The representations and warranties of the Company set
forth in the Agreement are true on and as of the date hereof as if
made on and as of said date;

     2.3  The making and performance by the Company of this
Amendment and any documents delivered in connection herewith have
been duly authorized by all corporate action; and

     2.4  No consent, approval, authorization, permit or license
from any federal or state regulatory authority is required in
connection with the making or performance of this Amendment or the
Agreement as amended hereby.

3.   Conditions Precedent.  This Amendment shall become effective
upon the Bank's receipt of:

     3.1  payment in full, in immediately available funds, of the
entire unpaid principal amount remaining outstanding pursuant to
the Senior Agreement, together with all interest thereon accrued to
the date of repayment, and any other obligations remaining unpaid
pursuant to the Senior Agreement;

     3.2  (a) a $500,000 principal payment on the Loan, (b) payment
of all interest accrued on the Loan through July 31, 1997, and (c)
a prepayment of interest which may accrue on the Loan after July
31, 1997 in the amount of $281,388.41, all in immediately available
funds;

     3.3  appropriate board resolutions with respect to the
execution and delivery of this Amendment and any documents
delivered in connection herewith, together with certificates of
incumbency for the officers executing such documents;

     3.4  a copy of the fully executed BNY Credit Agreement (faxed
copy acceptable, with a hard copy to follow); and

     3.5  an Agreement and Acknowledgement in the form of Exhibit
A hereto, executed and delivered by each Subsidiary, and an
Agreement and Acknowledgement in the form of Exhibit B hereto
executed and delivered by Matthew Gold.

4.   Miscellaneous.

     4.1  Interest is accruing at the post-default rate provided in
Section 2.3(b) of the Agreement.  Nothing herein which waives,
cures or resolves existing defaults shall affect the rate at which
such interest accrued prior to the First Amendment Effective Date,
and any such waiver, cure or resolution shall not be deemed to be
retroactive.

     4.2  This Amendment may be signed in any number of
counterparts, each of which shall be an original, with same effect
as if the signatures thereto and hereto were upon the same
instrument.

     4.3  Except as herein specifically amended, all terms,
covenants and provisions of the Agreement shall remain in full
force and effect and shall be performed by the parties thereto, and
all references therein or in the Exhibits to the Agreement shall
henceforth refer to the Agreement as amended by this Amendment.

     4.4  The amendments contained herein shall be effective only
to the extent specifically set forth herein and shall not be
construed as waivers of or consents to any other breach or default
or of any other provision of the Agreement.

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

                              PRECISION STANDARD, INC.

                              By: ______________________________
                              Title:____________________________


                              BANK OF AMERICA NATIONAL TRUST AND
                              SAVINGS ASSOCIATION

                              By:_______________________________
                              Title:____________________________



































                            Exhibit A

                  Agreement and Acknowledgement

     We acknowledge and consent to the First Amendment to Second
Amended and Restated Senior Subordinated Loan Agreement dated as of
___________________, 1997 (the "Loan Agreement") and agree that our
respective guaranties of the indebtedness of Precision Standard,
Inc. pursuant to the Loan Agreement (and all collateral documents
executed in connection therewith) shall remain in full force and
effect.

PEMCO AEROPLEX, INC.
(formerly known as Hayes International Corporation)

By: __________________________
Title:________________________


HAYES HOLDINGS I INC.

By: __________________________
Title:________________________


HAYES HOLDINGS II INC.

By: __________________________
Title:________________________


SPACE VECTOR CORPORATION

By: __________________________
Title: _______________________


AIR INTERNATIONAL CORPORATION

By: __________________________
Title: _______________________

















                            Exhibit B
                  Agreement and Acknowledgement

     The undersigned acknowledges and consents to the First
Amendment to Second Amended and Restated Senior Subordinated Loan
Agreement dated as of ________________, 1997 (the "Loan Agreement")
and agrees that his Guaranty Agreement dated as of December 31,
1996 with respect to the indebtedness of Precision Standard,     
Inc. pursuant to the Loan Agreement shall remain in full force and
effect.


                                   _________________________
                                        Matthew L. Gold





































                            EXHIBIT C
                   BORROWING BASE CERTIFICATE
                    Precision Standard, Inc.


Eligible Inventory:                     ___________________

X Inventory Advance Rate:               x__________________
________________________

= (a) Inventory Availability (or        =__________________
any maximum inventory cap)



Eligible Receivables                    ___________________
X Receivables Advance Rate
                                        x__________________
__________________________

= (b) Receivables Available             =__________________

Lower of (i) Total Availability         ___________________
(a+b) or (ii) Maximum Loan Amount



Current Outstanding Loans
as of (date)                            ___________________