**Exhibit 10.19**

 

# **IRREVOCABLESTANDBY 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 atsight, subject to the requirements of this Letter of Credit, in an aggregateamount 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 at4:00 o’clock p.m. (Mountain Time) on April 17, 2007 (the “ExpirationTime”). The Expiration Time shall be automatically extended without amendmentfor one year periods from this or any future Expiration Time, unless sixty daysprior to any such Expiration Time the Issuing Bank notifies the Beneficiary atthe address listed above and the Additional Notice Parties (listed below), inwriting by registered mail or express courier, that the Issuing Bank elects notto extend the Letter of Credit.

 

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Nothwithstanding the above automaticextension provision, it is a condition of this Letter of Credit that the StatedAmount will automatically reduce without amendment on the dates and in theamounts as listed on the attached Exhibit A, and made a part hereof. Suchreduction will take place on each corresponding date at 4:00 p.m. MountainTime.

 

Drawings are available against manuallysigned draft(s) at sight by a duly authorized agent of Beneficiary stating thisLetter of Credit number presented to the Issuing Bank at its office statedabove, in a single mailing, by courier or personal delivery, and to theattention of the Commercial Loan Department and accompanied by a signedstatement reading as follows:

 

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

 

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

 

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

 

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

 

Communications with respect to this Letter ofCredit shall be in writing and shall be addressed to the Issuing Bank at theaddress set forth above. All communications must make reference to the Letterof 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 andnon-transferable.

 
|   | FIRST INTERSTATE BANK |
|--------|-----------------------|
|   |                  |
|   | By                    | /s/ Susan Riplett |   |
|   |                  |
|   | Its                   | Vice President |   |
|   |                  |
|   | By                    | /s/ Steve Tostenrud |   |
|   |                  |
|   | Its                   | Vice President |   |
|        |                       |  |  |  |  |  |

 

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