| Item 1.01. | Entry into a Material Definitive Agreement. |
Revolving Line of Credit
Mesa Air Group, Inc.’s (the “Company”) wholly owned subsidiaries, Mesa Airlines, Inc. (“Mesa”) and Mesa Air Group Airline Inventory Management, L.L.C. (“Mesa Inventory Management” and, together with Mesa, the “Borrowers”), previously entered into a Second Amended and Restated Credit and Guaranty Agreement dated as of June 30, 2022 (as amended by Amendment No. 1 to Second Amended and Restated Credit and Guaranty Agreement, dated as of December 27, 2022, and by Amendment No. 2 to Second Amended and Restated Credit and Guaranty Agreement, dated as of January 27, 2023, the “Existing Credit Agreement”), with Wilmington Trust, National Association (“WTNA”) (as successor to CIT Bank, a division of First-Citizens Bank & Trust Company), in its capacity as Administrative Agent (in such capacity, the “Administrative Agent”), WTNA (as successor to First-Citizens Bank & Trust Company (as successor by merger to CIT Bank, N.A.)), as collateral agent (in such capacity, the “Collateral Agent”) and the lenders from time to time party thereto (the “Lenders”), which is guaranteed by the Company. As previously reported, United Airlines, Inc. (“United”) purchased and assumed all of CIT Bank’s rights and obligations under the Existing Credit Agreement pursuant to a separate Assignment and Assumption Agreement and in connection with entering into the Third Amended and Restated Capacity Purchase Agreement with United, dated as of December 27, 2022.
On September 6, 2023, the Borrowers, the Company, the Administrative Agent, the Collateral Agent and the Lenders amended the Existing Facility pursuant to an Amendment No. 3 to Second Amended and Restated Credit and Guaranty Agreement (the “Amendment”) which, among other things, amends the Existing Credit Agreement (the Existing Credit Agreement, as amended by the Amendment, the “Amended Credit Facility”) to (i) permit the Borrowers to re-draw approximately $7.9 million of the Effective Date Bridge Loan (as defined in the Amended Credit Agreement) previously repaid; (ii) increase the amount of Revolving Commitments (as defined in the Amended Credit Facility) from $30.7 million to $50.7 million, in each case, plus the original principal amount of the Effective Date Bridge Loan and subject to the Borrowing Base (as defined in the Amended Credit Facility); and (iii) amend the calculation of the Borrowing Base. Amounts borrowed under this facility bear interest at 3.50% for Base Rate Loans and 4.50% per annum for Term SOFR Loans (as each term is defined in the Amended Credit Facility). Amounts borrowed under the Amended Credit Facility are secured by a collateral pool consisting of a combination of expendable parts, rotable parts and engines, a pledge of certain of the Company’s bank accounts and a pledge of the Company’s stock in certain aviation companies. The foregoing description of the Amendment and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the full text of such document, which we expect to file as an exhibit to our Annual Report on Form 10-K for the fiscal year ending September 30, 2023, subject to any applicable requests for confidential treatment with respect to certain portions of such agreements.
