Exhibit 10.19

 

IRREVOCABLE STANDBY LETTER OF CREDIT

 

April 17, 2006

 

BENEFICIARY:

 

LETTER OF CREDIT NO. 1109600324

UMB Bank, N.A., as Trustee

Corporate Trust Division

Attention:  Anthony Hawkins

2401 Grand Blvd., Suite 200

Kansas City, MO 64108

 

Applicant:

MAIR Holdings, Inc.

150 South 5th Street

Suite 1360

Minneapolis, MN 55402

 

Issuing Bank:

First Interstate Bank

Attention:  Steve Tostenrud

401 North 31st St.

P.O. Box 30918

Billings, MT 59116-0918

 

Ladies and Gentlemen:

 

First Interstate Bank (the “Issuing Bank”) hereby issues this irrevocable
standby letter of credit (the “Letter of Credit”) for the benefit of the
Beneficiary and available by your draft or drafts at sight, subject to the
requirements of this Letter of Credit, in an aggregate amount not to exceed
THIRTEEN MILLION ONE HUNDRED TEN THOUSAND AND 00/100 U.S. DOLLARS
(13,110,000.00) (the “Stated Amount”). This Letter of Credit expires at 4:00
o’clock p.m. (Mountain Time) on April 17, 2007 (the “Expiration Time”). The
Expiration Time shall be automatically extended without amendment for one year
periods from this or any future Expiration Time, unless sixty days prior to any
such Expiration Time the Issuing Bank notifies the Beneficiary at the address
listed above and the Additional Notice Parties (listed below), in writing by
registered mail or express courier, that the Issuing Bank elects not to extend
the Letter of Credit.

 

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Nothwithstanding the above automatic extension provision, it is a condition of
this Letter of Credit that the Stated Amount will automatically reduce without
amendment on the dates and in the amounts as listed on the attached Exhibit A,
and made a part hereof. Such reduction will take place on each corresponding
date at 4:00 p.m. Mountain Time.

 

Drawings are available against manually signed draft(s) at sight by a duly
authorized agent of Beneficiary stating this Letter of Credit number presented
to the Issuing Bank at its office stated above, in a single mailing, by courier
or personal delivery, and to the attention of the Commercial Loan Department and
accompanied by a signed statement reading as follows:

 

“The undersigned, on behalf of the Beneficiary, certifies that (1) the
undersigned is duly authorized to execute and deliver this draft, (2) the Draw
Amount is due and owing to the Beneficiary by reason of a default by Applicant
under the Agreement dated as of April 18, 2006, between Beneficiary and
Applicant, and (3) Beneficiary has complied with all notice and other
requirements under said Agreement.”

 

All drafts drawn under and in compliance with the terms of this Letter of Credit
will be duly honored on receipt of the specified documents by the Issuing Bank
if actually received on a Business Day and before the Expiration Time. Partial
drawings are permitted provided the aggregate of all draws does not exceed the
Stated Amount. “Business Day” means any calendar day, other than a Saturday,
Sunday or legal holiday, and on which the Issuing Bank is open for business at
the office.

 

This Letter of Credit sets forth in full the Issuing Bank’s undertakings and the
undertaking shall not be in any way modified, amended or limited by reference to
any other document, instrument or agreement, excepting only the sight drafts and
required drawing statement and drawing documents identified above.

 

This Letter of Credit is subject to the terms and conditions of the
“Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500” or any subsequent
revision thereof (the “Uniform Customs”).

 

Communications with respect to this Letter of Credit shall be in writing and
shall be addressed to the Issuing Bank at the address set forth above. All
communications must make reference to the Letter of Credit number.

 

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The Additional Notice Parties are:

 

Mintz, Levin, Cohn, Ferris, Glovsky

 

Oppenheimer Funds, Inc.

and Popeo, P.C.

 

350 Linden Oaks

One Financial Center

 

Rochester, NY 14625

Boston, MA 02111

 

Attention: Angela Uttaro

Attention: Kevin J. Walsh

 

 

 

 

 

Merrill Lynch Investment Managers

 

 

800 Scudders Mill Road

 

 

Section 1B

 

 

Plainsboro, NJ 08536

 

 

Attention: Christopher Fornal

 

 

 

This Letter of Credit is non-assignable and non-transferable.

 

 

FIRST INTERSTATE BANK

 

 

 

By

/s/ Susan Riplett

 

 

 

 

Its

Vice President

 

 

 

 

By

/s/ Steve Tostenrud

 

 

 

 

Its

Vice President

 

 

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