AIR TRANSPORT SERVICES GROUP, INC. : Entering into a Material Definitive Agreement, Creating a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant, Financial Statements and Exhibits (Form 8-K)

Item 1.01. Conclusion of a significant definitive agreement

First Amendment to Third Amended and Restated Credit Agreement and Other Credit Documents

On October 19, 2022, Airline Services Group, Inc. (the company”), Cargo Aircraft Management, Inc. (the “Borrower”) and certain of the Company’s other subsidiaries have entered into the First Amendment to the Third Amended and Restated Credit Agreement and Other Credit Documents (the “First Amendment”) by and between the Company, the Borrower, certain Company Affiliates as Subsidiary Guarantors (collectively, the “Subsidiary Guarantors”), the Financial Institution Parties as Lenders (collectively, the “Lenders”) and Truist Bank, as administrative agent of the Lenders (in this capacity, the “Administrative Agent”). The First Amendment amends (i) certain Third Amended and Restated Credit Agreements dated April 6, 2021 (the “Existing Credit Agreement” and, as amended by the First Amendment, the “Credit Agreement”), by and between the Company, the Borrower, the Lenders and the Administrative Agent and (ii) that certain Second Amended and Renewed Warranties and Warranty Agreement, dated November 9, 2018by and between the Company, the Borrower, the Subsidiary Guarantors parties thereto and the Administrative Agent (the “Existing Guarantee and Security Agreement”).

The First Amendment amends the Existing Credit Agreement and the Existing Guarantee and Guarantee Agreement by, among other things, (i) increasing the aggregate principal amount of the commitments under the Revolving Facility (the “Revolving Facility”) by $200.0 million at $1.0 billion(ii) reducing the commitment fees applicable to the Revolving Facility by 0.05%, as applicable, based on the Company’s secured leverage ratio, (iii) replacing LIBOR with SOFR as the interest rate and allowing the Borrower to select an index rate for each borrowing from multiple interest rate options, including an adjusted forward SOFR of one or three months, (iv) the extension of the maturity date of the revolving facility at October 19, 2027(v) reduce the outstanding loan collateral ratio to 1.15:1.00 from 1.25:1:00, (vi) exclude each of the Company’s Irish subsidiaries and each of their subsidiaries and certain other subsidiaries from the Company from the obligation to join the Revolving Facility as a standby guarantor, (vii) make amendments to certain negative covenants and events of default of the existing credit agreement to enable the Irish credit facility (such as defined below), (viii) allow cash dividends and share repurchases provided the collateral Leverage ratio is less than 3.00 to 1.00 and the total leverage ratio is less than 3, 50 for 1.00, instead of an annual report
$100 million limitation of cash dividends and share buybacks; and (ix) provide for the release of collateral securing the obligations under the Credit Agreement if the Company obtains an investment grade rating from two of the three rating agencies, subject to reversion if two of such rating agencies withdraw the Company’s investment grade rating or downgrade the Company’s rating below investment grade.

Except as provided in the First Amendment, all other terms and conditions of the Existing Credit Agreement and the Existing Guarantee and Guarantee Agreement shall remain in full force and effect.

The foregoing description of the First Amendment and the Revolving Facility is qualified in its entirety by reference to the text of the First Amendment, a copy of which is filed as Exhibit 10.1 hereto and is incorporated herein by reference. The existing credit agreement is described in item 1.01 of the current report on Form 8-K filed by the company on April 6, 2021, and was filed as Exhibit 10.1. The existing warranty and guarantee agreement is described in Item 1.01 of the Company’s Annual Report on Form 10-K filed on
March 1, 2019and was filed as Exhibit 10.63.

Irish credit facility

After giving effect to the First Amendment, it is intended that the Company’s Irish subsidiary, Airborne Global Leasing Limited (the “Irish Subsidiary”), will enter into, and the Company and certain of the other subsidiaries of the Company (except the Irish Subsidiary) will guarantee, a $100 million secured revolving credit facility governed by Irish law (the “Irish Credit Facility”) between the Irish Subsidiary, the Company, certain subsidiaries of the Company (other than the Irish Subsidiary), other financial institutions therein parts and Truist Bank (in such capacity, “the Administrative Agent of the Irish Credit Facility”). The Irish Credit Facility is expected to be secured by first ranking security interests in certain qualifying aircraft owned by the Irish Subsidiary and will be subject to terms acceptable to the Irish Credit Facility Administrative Agent.

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Section 2.03. Creation of a Direct Financial Obligation or an Obligation under a

           Off-Balance Sheet Arrangement of the Registrant.


The information set forth in Section 1.01 of this Current Report on Form 8-K is incorporated by reference into this Section 2.03.

Section 9.01. Financial statements and supporting documents.


(d) Exhibits



Exhibit No.       Description

10.1                First Amendment to Third Amended and Restated Credit Agreement
                  and Other Credit Documents, dated as of October 19, 2022, by and
                  among Cargo Aircraft Management, Inc., as Borrower, Air Transport
                  Services Group, Inc. ("ATSG"), certain other subsidiaries of ATSG
                  party thereto, each of the financial institutions party thereto
                  as "Lenders" and Truist Bank, in its capacity as Administrative
                  Agent

104               Cover Page Interactive Data File (embedded within the Inline XBRL
                  document)

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