Exhibit 10.4

 

 

AMENDED AND RESTATED GUARANTY

 

THIS GUARANTY, dated as of March 28, 2019, is jointly and severally executed by
the guarantors listed on the signature pages hereto (the "Original Guarantors",
which term includes each of the Existing Guarantors, hereinafter defined) or
from time to time party hereto by execution of a joinder agreement (the
"Additional Guarantors", and together with the Original Guarantors, the
"Guarantors"), in favor of MINNESOTA BANK & TRUST, a Minnesota state banking
corporation (together with its successors and assigns, the “Lender”).

 

RECITALS

 

WHEREAS, Air T, Inc., a Delaware corporation (together with its successors and
assigns, the “Borrower”), and Minnesota Bank & Trust, a Minnesota state banking
corporation (together with its successors and assigns, the “Lender”), a parties
to that certain Credit Agreement dated as of December 21, 2017 (such Credit
Agreement, as amended to date being, the “Original Credit Agreement”), pursuant
to which the Lender has extended credit to the Borrower.

 

WHEREAS, as a condition precedent to the effectiveness of the Original Credit
Agreement, certain Subsidiaries of the Borrower (the “Existing Guarantors”)
executed and delivered to Lender that certain Guaranty dated as of December 21,
2017, pursuant to which the Existing Guarantors guaranteed the payment and
performance of all obligations of the Borrower to the Lender.

 

WHEREAS, the Borrower and Lender have entered into that certain Amended and
Restated Credit dated as of even date herewith, amending and restating the
Original Credit Agreement in its entirety (such Amended and Restated Credit
Agreement, as it may be amended, modified, supplemented, replaced or restated
from time to time being, the “Credit Agreement”; capitalized terms not otherwise
defined herein being used herein as therein defined.

 

WHEREAS, in order to induce Lender to enter into the Credit Agreement, and as
additional security for the Loans and for all sums advanced by the Lender under
the Notes and the Credit Agreement, and for the payment and performance by
Borrower of its obligations under the Notes and the Credit Agreement, Borrower
has agreed to obtain, and Guarantors have jointly and severally agreed to
execute, deliver and perform, this Guaranty; and

 

WHEREAS, the Lender is unwilling to enter into the Credit Agreement or to make
any advances under the Notes and/or the Credit Agreement unless this Guaranty is
executed by the Guarantors and is delivered to Lender and remains in full force
and effect; and

 

WHEREAS, this Guaranty amends, restates and replaces, in its entirety, the
Existing Guaranty;

 

 

--------------------------------------------------------------------------------

 

 

NOW, THEREFORE, in consideration of the Lender entering into the Credit
Agreement, Lender’s agreement to make the Loans to Borrower in accordance with
the terms of the Credit Agreement and of other good and valuable consideration,
the receipt and sufficiency of which are hereby jointly and severally
acknowledged by the Guarantors, the Guarantors hereby jointly and severally
covenant and agree with the Lender to amend, restate and replace the Existing
Guaranty in its entirety to read as follows:

 

Section 1.   Guaranty of Payment. For value received, and in consideration of
any loan or other financial accommodation heretofore or hereafter at any time
made or granted to Air T, Inc., a Delaware corporation (hereinafter called the
“Borrower”), by the Lender, the undersigned hereby jointly and severally
unconditionally guarantee the full and prompt payment when due, whether by
acceleration or otherwise, and at all times thereafter, of all obligations of
the Borrower to the Lender, howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, or now or hereafter existing, or due
or to become due, including, without limitation, all Obligations of the Borrower
to the Lender pursuant to that certain Amended and Restated Credit Agreement
dated as of March 28, 2019 (as the same may be amended, modified, supplemented,
restated or replaced from time to time, the “Credit Agreement”; capitalized
terms not otherwise defined herein shall have the meanings respectively ascribed
to such terms in the Credit Agreement) by and between the Borrower and the
Lender (all such obligations being hereinafter collectively called the
“Obligations”), and each of the undersigned further agrees to pay all expenses,
including fees of attorneys (who may be employees of the Lender or any
Affiliate) and legal expenses, paid or incurred by the Lender in endeavoring to
collect the Obligations, or any part thereof, and in enforcing this Guaranty.

 

Section 2.     Acceleration of the Time of Payment of Amount Payable Under the
Guaranty. Each of the undersigned agrees that if any of the undersigned shall be
dissolved or shall be or become insolvent (however defined) or any of the
undersigned voluntarily commences or there is commenced involuntarily against
such undersigned a case under the United States Bankruptcy Code, the full amount
of all Obligations, whether due and payable or unmatured, shall be immediately
due and payable without demand or notice thereof, to the extent provided in the
Credit Agreement.

 

Section 3.     Security Interest in Deposits and Other Property. To secure all
obligations of each of the undersigned hereunder, the Lender shall have a Lien
upon and security interest in (and may, without demand or notice of any kind, at
any time and from time to time when any amount shall be due and payable by such
undersigned hereunder, appropriate and apply toward the payment of such amount,
in such order as the Lender may elect, any and all balances, credits, deposits
(general or special, time or demand, provisional or final), accounts or moneys
of or in the name of such undersigned now or hereafter with the Lender or any
Affiliate of the Lender and any and all property of every kind or description of
or in the name of such undersigned now or hereafter with the Lender or any
Affiliate of the Lender and any and all property of every kind or description of
or in the name of such undersigned now or hereafter, for any reason or purpose
whatsoever, in the possession or control of, or in transit to, the Lender or any
Affiliate of the Lender or bailee for any such Person.

 

2

--------------------------------------------------------------------------------

 

 

Section 4.     Continuing Guaranty. This Guaranty shall in all respects be a
continuing, absolute and unconditional Guaranty, and shall remain in full force
and effect (notwithstanding, without limitation, the dissolution of any of the
undersigned or that at any time or from time to time all Obligations may have
been paid in full), subject to discontinuance as to any of the undersigned only
upon actual receipt by the Lender of written notice from such undersigned, or
any person duly authorized and acting on behalf of such undersigned, of the
discontinuance hereof as to such undersigned; provided, however, that no such
notice of discontinuance shall affect or impair any of the agreements and
obligations of such undersigned hereunder with respect to any and all
Obligations existing prior to the time of actual receipt of such notice by the
Lender, any and all Obligations created or acquired thereafter pursuant to any
previous commitments made by the Lender, any and all extensions or renewals of
any of the foregoing, any and all interest on any of the foregoing, and any and
all expenses paid or incurred by the Lender in endeavoring to collect any of the
foregoing and in enforcing this Guaranty against such undersigned; and all of
the agreements and obligations of such undersigned under this Guaranty shall,
notwithstanding any such notice of discontinuance, remain fully in effect until
all such Obligations (including any extensions or renewals of any thereof) and
all such interest and expenses shall have been paid in full. Any such notice of
discontinuance by or on behalf of any of the undersigned shall not affect or
impair the obligations hereunder of any other of the undersigned.

 

Section 5.     Recission or Return of Payment on Obligations. The undersigned
further jointly and severally agree that, if at any time all or any part of any
payment theretofore applied by the Lender to any of the Obligations is or must
be rescinded or returned by the Lender for any reason whatsoever (including,
without limitation, the insolvency, bankruptcy or reorganization of the Borrower
or any of the undersigned), such Obligations shall, for the purposes of this
Guaranty, to the extent that such payment is or must be rescinded or returned,
be deemed to have continued in existence, notwithstanding such application by
the Lender, and this Guaranty shall continue to be effective or be reinstated,
as the case may be, as to such Obligations, all as though such application by
the Lender had not been made.

 

Section 6.     Lender Permitted to Take Certain Actions. The Lender may, from
time to time (but shall not be obligated to), whether before or after any
discontinuance of this Guaranty, at its sole discretion and without notice to
the undersigned (or any of them), take any or all of the following actions: (a)
retain or obtain a security interest in any property to secure any of the
Obligations or any obligation hereunder; (b) retain or obtain the primary or
secondary obligation of any obligor or obligors, in addition to the undersigned,
with respect to any of the Obligations; (c) extend or renew for one or more
periods (whether or not longer than the original period), alter or exchange any
of the Obligations, or release or compromise any obligation of any of the
undersigned hereunder or any obligation of any nature of any other obligor with
respect to any of the Obligations; (d) release its security interest in, or
surrender, release or permit any substitution or exchange for, all or any part
of any property securing any of the Obligations or any obligation hereunder, or
extend or renew for one or more periods (whether or not longer than the original
period) or release, compromise, alter or exchange any obligations of any nature
of any obligor with respect to any such property; and (e) resort to the
undersigned (or any of them) for payment of any of the Obligations, whether or
not the Lender (i) shall have resorted to any property securing any of the
Obligations or any obligation hereunder or (ii) shall have proceeded against the
Borrower or any other of the undersigned or any other obligor primarily or
secondarily obligated with respect to any of the Obligations (all of the actions
referred to in preceding clauses (i) and (ii) being hereby expressly waived by
the undersigned).

 

3

--------------------------------------------------------------------------------

 

 

Section 7.     Application of Payments. Any amounts received by the Lender from
whatsoever source on account of the Obligations may be applied by it toward the
payment of such of the Obligations and in such order of application, as the
Lender may from time to time elect.

 

Section 8.     Subordination. Except as the Lender may hereafter expressly
consent in writing, the payment of all obligations of the Borrower to the
undersigned, howsoever created, arising or evidenced, whether direct or
indirect, absolute or contingent or now or hereafter existing, as due or to
become due (collectively, the “Guarantor Liabilities”) shall be postponed and
subordinated to the payment in full of all Obligations, and no payments or other
distributions whatsoever in respect of any Guarantor Liabilities shall be made,
nor shall any property or assets of the Borrower or any other person obligated
on the Obligations be applied to the purchase or other acquisition or retirement
of any Guarantor Liabilities following the occurrence and during the continuance
of any Event of Default. If any payment on the Guarantor Liabilities is
prohibited from being paid by operation of this Guaranty such payment shall be
payable only after the payment in full of the Obligations and the termination of
the Credit Agreement, and the Borrower’s failure to make a payment on the
Guarantor Liabilities by reason of this Guaranty shall not constitute an event
of default on the Guarantor Liabilities.

 

Section 9.     Waiver of Claims. Until such time as this Guaranty shall have
been discontinued as to all of the undersigned and the Lender shall have
received payment of the full amount of all Obligations and of all obligations of
the undersigned hereunder and the Credit Agreement has been terminated, no
payment made by or for the account of the undersigned (or any of them) pursuant
to this Guaranty shall entitle any of the undersigned by subrogation or
otherwise to any payment by the Borrower or from or out of any property of the
Borrower, and none of the undersigned shall exercise any right or remedy against
the Borrower or any property of the Borrower by reason of an performance by such
undersigned of this Guaranty.

 

Section 10.  Waiver of Notice and Other Matters. Each of the undersigned hereby
expressly waives: (a) notice of the acceptance by the Lender of this Guaranty;
(b) notice of the existence or creation or non-payment of all or any of the
Obligations; (c) presentment, demand, notice of dishonor, protest, and all other
notices whatsoever; and (d) all diligence in collection or protection of or
realization upon the Obligations or any thereof, any obligation hereunder, or
any security for or guaranty of any of the foregoing.

 

Section 11.  Assignment of Obligations. Subject to provisions of Credit
Agreement, the Lender may, from time to time, whether before or after any
discontinuance of this Guaranty, without notice to the undersigned (or any of
them), assign or transfer any or all of the Obligations or any interest therein;
and, notwithstanding any such assignment or transfer or any subsequent
assignment or transfer thereof, such Obligations shall be and remain Obligations
for the purposes of this Guaranty, and each and every immediate and successive
assignee or transferee of any of the Obligations or of any interest therein
shall, to the extent of the interest of such assignee or transferee in the
Obligations, be entitled to the benefits of this Guaranty to the same extent as
if such assignee or transferee were the transferor; provided, that, unless the
Lender shall otherwise consent in writing, the Lender shall have an unimpaired
right, prior and superior to that of any such assignee or transferee, to enforce
this Guaranty, for the benefit of the Lender, as to those of the Obligations
which the Lender has not assigned or transferred.

 

4

--------------------------------------------------------------------------------

 

 

Section 12.   Information Concerning Borrower. Each of the undersigned hereby
warrants to the Lender that such undersigned now has and will continue to have
independent means of obtaining information concerning the affairs, financial
condition and business of the Borrower. The Lender shall not have any duty or
responsibility to provide the undersigned (or any of them) with any credit or
other information concerning the affairs, financial condition or business of the
Borrower, which may come into the Lender’s possession.

 

Section 13.   Waiver and Modifications. No delay on the part of the Lender in
the exercise of any right or remedy shall operate as a waiver thereof, and no
single or partial exercise by the Lender of any right or remedy shall preclude
other or further exercise thereof or the exercise of any other right or remedy;
nor shall any modification or waiver of any of the provisions of this Guaranty
be binding upon the Lender except as expressly set forth in a writing duly
signed and delivered on behalf of the Lender.

 

Section 14.   Obligations Under Guaranty. No action of the Lender permitted
hereunder shall in any way affect or impair the rights of the Lender and the
obligations of the undersigned under this Guaranty. For the purposes of this
Guaranty, the Obligations shall include all Obligations of the Borrower to the
Lender, notwithstanding any right or power of the Borrower or anyone else to
assert any claim or defense as to the invalidity or un enforceability of any
such Obligation, and no such claim or defense shall affect or impair the
obligations of the undersigned hereunder. The obligations of the undersigned
under this Guaranty shall be absolute and unconditional irrespective of any
circumstance whatsoever which might constitute a legal or equitable discharge or
defense of the undersigned (or any of them). Each of the undersigned hereby
acknowledges that there are no conditions to the effectiveness of this Guaranty.

 

Section 15.   Successors. This Guaranty shall be binding upon each of the
undersigned, and upon the successors and assigns of such undersigned, and to the
extent that the Borrower or any of the undersigned is either a partnership or a
corporation, all references herein to the Borrower and to the undersigned,
respectively, shall be deemed to include any successor or successors, whether
immediate or remote, to such partnership or corporation.

 

Section 16.   Joint and Several Obligation. If more than one party shall execute
this Guaranty, the term “undersigned,” as used herein, shall mean all parties
executing this Guaranty and each of them, and all such parties shall be jointly
and severally obligated hereunder.

 

Section 17.    Governing Law. THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF
THIS GUARANTY SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA,
WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

Section 18.  Consent to Jurisdiction. AT THE OPTION OF THE LENDER, THIS GUARANTY
MAY BE ENFORCED IN ANY FEDERAL COURT OR MINNESOTA STATE COURT SITTING IN
MINNEAPOLIS, OR ST. PAUL, MINNESOTA; AND EACH OF THE UNDERSIGNED CONSENTS TO THE
JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT VENUE IN
SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT ANY OF THE UNDERSIGNED COMMENCES ANY
ACTION IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY
ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS GUARANTY OR
ANY OTHER LOAN DOCUMENT, THE LENDER, AT ITS OPTION, SHALL BE ENTITLED TO HAVE
THE CASE TRANSFERRED TO ONE OF THE JURISDICTIONS AND VENUES ABOVE-DESCRIBED, OR
IF SUCH TRANSFER CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE
DISMISSED WITHOUT PREJUDICE.

 

5

--------------------------------------------------------------------------------

 

 

Section 19.   Waiver of Jury Trial. EACH OF THE UNDERSIGNED HEREBY EXPRESSLY
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR
DEFEND ANY RIGHTS (a) UNDER THIS GUARANTY OR UNDER ANY AMENDMENT, INSTRUMENT,
DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN
CONNECTION HEREWITH, OR (b) ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS GUARANTY, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

 

Section 20.    Severability. Wherever possible, each provision of this Guaranty
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty. In any action or
proceeding involving any state organizational law, or any state or federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any of the undersigned hereunder
would otherwise be held or determined to be void, invalid or unenforceable on
account of such undersigned’s liability under this Guaranty, then,
notwithstanding any other provision of this Guaranty to the contrary, the amount
of such liability shall, without any further action by such undersigned, the
Lender or any other Person, be automatically limited and reduced to the highest
amount which is valid and enforceable as determined in such action or
proceeding.

 

Section 21.   Captions. Section captions used in this Guaranty are for
convenience only, and shall not affect the construction of this Guaranty.

 

Section 22.   Certain Representations and Warranties. Each of the undersigned
represents and warrants to the Lender that: (a) each of the representations and
warranties contained in the Credit Agreement pertaining to such undersigned as a
Subsidiary of the Borrower or as a Loan Party or words of like import referring
to such undersigned are true and correct; and (b) (i) the Borrower and each of
the undersigned make up a related organization of various entities constituting
a single economic and business enterprise so that the Borrower and all of the
undersigned share an identity of interests such that any benefit received by any
one of them benefits the others; (ii) the Borrower and each of the undersigned
render services for the benefit of the one another, purchases or sells and
supplies goods to or from or for the benefit of one another, makes loans,
advances and provides other financial accommodations to or for the benefit of
one another; (iii) in some cases, the Borrower and some of the undersigned have
centralized accounting and legal service and common officers and directors; and
(iv) while the Borrower and all of the undersigned operate as a single economic
enterprise, nothing contained in this subsection (b) should be construed or
imply that the Borrower and each of the undersigned are not separate legal
entities.

 

6

--------------------------------------------------------------------------------

 

 

Section 23.  Additional Covenants. Each of the undersigned agree(s) to perform
and observe the affirmative and negative covenants respectively set forth in
ARTICLE 6 and 7 of the Credit Agreement that apply to the undersigned as a
Subsidiary of the Borrower or as a Loan Party and that such covenants are
incorporated herein by reference as though fully set forth herein.

 

Section 24.   Amendment and Restatement. This Guaranty supersedes and replaces
the Existing Guaranty. Delivery and acceptance of this Guaranty shall not
evidence release or satisfaction of or a novation with respect to such prior
guaranty or any obligations of Guarantor under such prior guaranty, which
obligations remain outstanding and shall be evidenced by this Guaranty. The
liens, security interests, assignments and other rights evidenced by this
Guaranty are hereby renewed and extended to secure payment of the Notes.

 

Section 25.   Acknowledgment. Each Guarantor hereby acknowledges that such
Guarantor has received copies of the Credit Agreement, the Notes and the other
Loan Documents, and consents to the Borrower’s execution and delivery of the
Loan Documents.

 

Section 26.    Counterparts. This Guaranty may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall constitute one and the same instrument. It shall not be
necessary in making proof of this Guaranty to produce or account for more than
one such counterpart. Delivery of an executed counterpart of a signature page of
this Guaranty by fax transmission or other electronic mail transmission (e.g.
“pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart of this Guaranty.

 

 

[SIGNATURE PAGES FOLLOW]

 

7

--------------------------------------------------------------------------------

 

 

IN WITNESS WHEREOF, this guaranty has been duly executed by the undersigned as
of the date first written above.

 

 

  AIRCO, LLC      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          CSA AIR, INC.      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

         

GLOBAL AVIATION SERVICES, LLC

     

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          GLOBAL GROUND SUPPORT, INC.          

By:                                                                        

Name: Candice L. Otey

Title:    Secretary 

      JET YARD, LLC          

By: Stratus Aero Partners, LLC

Its:  Sole Member

     

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

 

 

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 1 OF 3)

 

--------------------------------------------------------------------------------

 

 

  MOUNTAIN AIR CARGO, INC.      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          STRATUS AERO PARTNERS, LLC      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          AIR T GLOBAL LEASING, LLC      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          AIRCO SERVICES, LLC      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

          SPACE AGE INSURANCE COMPANY      

By:                                                                        

Name: Candice L. Otey

Title:    Secretary

         

Worthington acquisition, LLC, a North

Carolina limited liability company

      By:                                                          Name:        
                                                Its:                            
                         

 

 

 

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 2 OF 3)

 

--------------------------------------------------------------------------------

 

 

 

Worthington aviation, LLC, a North

Carolina limited liability company

        By:                                                         Name:      
                                                  Its:                          
                                   

Worthington MRO, LLC, a North Carolina

limited liability company

        By:                                                         Name:      
                                                  Its:                          
                           

 

 

 

 

 

 

 

 

 

AGREED TO AND ACCEPTED:

 

Minnesota Bank & Trust,

a Minnesota state banking

corporation

 

By:                                                                        

Name: Eric P. Gundersen

Title:   Senior Vice President

 

 

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 3 OF 3)