# EDGAR Filing Document

**Accession Number:** 0000899394
**File Stem:** 0000899394-26-000011
**Filing Date:** 2026-4
**Character Count:** 930675
**Document Hash:** b6e86d7ebe370527e27b5f6ebb44aa01
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000899394-26-000011.hdr.sgml**: 20260408

**ACCESSION NUMBER**: 0000899394-26-000011

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 97

**CONFORMED PERIOD OF REPORT**: 20241231

**FILED AS OF DATE**: 20260408

**DATE AS OF CHANGE**: 20260408

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** HARBOR DIVERSIFIED, INC.
- **CENTRAL INDEX KEY:** 0000899394
- **STANDARD INDUSTRIAL CLASSIFICATION:** AIR TRANSPORTATION, SCHEDULED [4512]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 133697002
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-34584
- **FILM NUMBER:** 26848747

**BUSINESS ADDRESS:**
- **STREET 1:** 5601 W. GRANDE MARKET DRIVE
- **STREET 2:** SUITE C
- **CITY:** APPLETON
- **STATE:** WI
- **ZIP:** 54913
- **BUSINESS PHONE:** (920) 749-4188

**MAIL ADDRESS:**
- **STREET 1:** 5601 W. GRANDE MARKET DRIVE
- **STREET 2:** SUITE C
- **CITY:** APPLETON
- **STATE:** WI
- **ZIP:** 54913

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Harbor BioSciences, Inc.
- **DATE OF NAME CHANGE:** 20100223

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** HOLLIS EDEN PHARMACEUTICALS INC /DE/
- **DATE OF NAME CHANGE:** 19970410

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** INITIAL ACQUISITION CORP
- **DATE OF NAME CHANGE:** 19930329

?xml version='1.0' encoding='ASCII'? hrbr-20241231

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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

_____________________

**FORM 10-K**

_____________________

(Mark One)

⌧ **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the fiscal year ended December 31, 2024**

**OR** 

□ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from ________ to ________.**

**Commission File Number 001-34584**

_____________________

**HARBOR DIVERSIFIED, INC.**

**(Exact name of registrant as specified in its charter)** 

_____________________

---

| | |
|:---|:---|
| **Delaware** | **13-3697002** |
| **(State or other jurisdiction of incorporation or organization)** | **(I.R.S. Employer<br>Identification No.)** |
| **5601 W. Grande Market Drive, Suite C**<br>**Appleton, WI** | **54913** |
| **(Address of principal executive offices)** | **(Zip Code)** |

---

**(920) 749-4188**

**(Registrant's telephone number, including area code)** 

**W6390 Challenger Drive, Suite 203**

**Appleton, WI 54914** 

**(Former name, former address and former fiscal year, if changed since last report)** 

**Securities registered pursuant to Section 12(b) of the Act: None.** 

**Securities registered pursuant to Section 12(g) of the Act: None.** 

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| **None** | **None** | **None** |

---

_____________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes □ No ⌧

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes □ No ⌧

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes □ No ⌧ **For additional information, please refer to the "Explanatory Note"**

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes □ No ⌧

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "***large accelerated filer***," "***accelerated filer***," "***smaller reporting company***" and "***emerging growth company***" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | □ | Accelerated filer | □ |
| Non-accelerated filer | ⌧ | Smaller reporting company | ⌧ |
| | | Emerging growth company | □ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.).&nbsp;&nbsp;&nbsp;&nbsp;□

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.&nbsp;&nbsp;&nbsp;&nbsp; □

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).&nbsp;&nbsp;&nbsp;&nbsp; □

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes □ No ⌧

As of June 30, 2024, the last business day of the registrant's second fiscal quarter for the year ended December 31, 2024, the aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant, based upon the closing price of the registrant's common stock as reported on the OTC Market, was approximately $37.4 million. The determination of affiliate status for this purpose does not reflect a determination that any of such persons shall be deemed to be an affiliate of the registrant for any other purpose.

As of March 11, 2026, the registrant had 58,429,836 shares of common stock outstanding. The registrant does not have any class of securities registered pursuant to Section 12(b) or Section 12(g) of the Act.

**DOCUMENTS INCORPORATED BY REFERENCE** 

**None.** 

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**HARBOR DIVERSIFIED, INC.** 

**ANNUAL REPORT ON FORM 10-K**

**For the Year Ended December 31, 2024**

**INDEX**

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| | | |
|:---|:---|:---|
| EXPLANATORY NOTE | EXPLANATORY NOTE | 1 |
| <u>[CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](#iab8ee63cdd734c278196d516ae236d0c_13)</u> | <u>[CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](#iab8ee63cdd734c278196d516ae236d0c_13)</u> | [2](#iab8ee63cdd734c278196d516ae236d0c_13) |
| <u>[PART I](#iab8ee63cdd734c278196d516ae236d0c_16)</u> | | [5](#iab8ee63cdd734c278196d516ae236d0c_16) |
| [ITEM 1.](#iab8ee63cdd734c278196d516ae236d0c_19) | <u>[BUSINESS](#iab8ee63cdd734c278196d516ae236d0c_19)</u> | [5](#iab8ee63cdd734c278196d516ae236d0c_19) |
| [ITEM 1A.](#iab8ee63cdd734c278196d516ae236d0c_22) | <u>[RISK FACTORS](#iab8ee63cdd734c278196d516ae236d0c_22)</u> | [14](#iab8ee63cdd734c278196d516ae236d0c_22) |
| [ITEM 1B.](#iab8ee63cdd734c278196d516ae236d0c_25) | <u>[UNRESOLVED STAFF COMMENTS](#iab8ee63cdd734c278196d516ae236d0c_25)</u> | [25](#iab8ee63cdd734c278196d516ae236d0c_25) |
| ITEM 1C. | <u>[CYBERSECURITY](#iab8ee63cdd734c278196d516ae236d0c_28)</u> | 41 |
| ITEM 2. | <u>[PROPERTIES](#iab8ee63cdd734c278196d516ae236d0c_31)</u> | [26](#iab8ee63cdd734c278196d516ae236d0c_31) |
| [ITEM 3.](#iab8ee63cdd734c278196d516ae236d0c_34) | <u>[LEGAL PROCEEDINGS](#iab8ee63cdd734c278196d516ae236d0c_34)</u> | [27](#iab8ee63cdd734c278196d516ae236d0c_34) |
| [ITEM 4.](#iab8ee63cdd734c278196d516ae236d0c_37) | <u>[MINE SAFETY DISCLOSURES](#iab8ee63cdd734c278196d516ae236d0c_37)</u> | [27](#iab8ee63cdd734c278196d516ae236d0c_37) |
| <u>[PART II](#iab8ee63cdd734c278196d516ae236d0c_40)</u> | | [28](#iab8ee63cdd734c278196d516ae236d0c_40) |
| [ITEM 5.](#iab8ee63cdd734c278196d516ae236d0c_43) | <u>[MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](#iab8ee63cdd734c278196d516ae236d0c_43)</u> | [28](#iab8ee63cdd734c278196d516ae236d0c_43) |
| ITEM 6. | <u>[\[RESERVED\]](#iab8ee63cdd734c278196d516ae236d0c_700)</u> | [29](#iab8ee63cdd734c278196d516ae236d0c_700) |
| [ITEM 7.](#iab8ee63cdd734c278196d516ae236d0c_49) | <u>[MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#iab8ee63cdd734c278196d516ae236d0c_49)</u> | [29](#iab8ee63cdd734c278196d516ae236d0c_49) |
| [ITEM 7A.](#iab8ee63cdd734c278196d516ae236d0c_91) | <u>[QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#iab8ee63cdd734c278196d516ae236d0c_91)</u> | [48](#iab8ee63cdd734c278196d516ae236d0c_91) |
| [ITEM 8.](#iab8ee63cdd734c278196d516ae236d0c_94) | <u>[FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](#iab8ee63cdd734c278196d516ae236d0c_94)</u> | [48](#iab8ee63cdd734c278196d516ae236d0c_94) |
| [ITEM 9.](#iab8ee63cdd734c278196d516ae236d0c_220) | <u>[CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE](#iab8ee63cdd734c278196d516ae236d0c_220)</u> | [83](#iab8ee63cdd734c278196d516ae236d0c_220) |
| [ITEM 9A.](#iab8ee63cdd734c278196d516ae236d0c_223) | <u>[CONTROLS AND PROCEDURES](#iab8ee63cdd734c278196d516ae236d0c_223)</u> | [83](#iab8ee63cdd734c278196d516ae236d0c_223) |
| [ITEM 9B.](#iab8ee63cdd734c278196d516ae236d0c_226) | <u>[OTHER INFORMATION](#iab8ee63cdd734c278196d516ae236d0c_226)</u> | [85](#iab8ee63cdd734c278196d516ae236d0c_226) |
| [ITEM 9C.](#iab8ee63cdd734c278196d516ae236d0c_229) | <u>[DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#iab8ee63cdd734c278196d516ae236d0c_229)</u> | [85](#iab8ee63cdd734c278196d516ae236d0c_229) |
| <u>[PART III](#iab8ee63cdd734c278196d516ae236d0c_232)</u> | | [86](#iab8ee63cdd734c278196d516ae236d0c_232) |
| [ITEM 10.](#iab8ee63cdd734c278196d516ae236d0c_235) | <u>[DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](#iab8ee63cdd734c278196d516ae236d0c_235)</u> | [86](#iab8ee63cdd734c278196d516ae236d0c_235) |
| [ITEM 11.](#iab8ee63cdd734c278196d516ae236d0c_238) | <u>[EXECUTIVE COMPENSATION](#iab8ee63cdd734c278196d516ae236d0c_238)</u> | [90](#iab8ee63cdd734c278196d516ae236d0c_238) |
| [ITEM 12.](#iab8ee63cdd734c278196d516ae236d0c_241) | <u>[SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](#iab8ee63cdd734c278196d516ae236d0c_241)</u> | [95](#iab8ee63cdd734c278196d516ae236d0c_241) |
| [ITEM 13.](#iab8ee63cdd734c278196d516ae236d0c_244) | <u>[CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](#iab8ee63cdd734c278196d516ae236d0c_244)</u> | [96](#iab8ee63cdd734c278196d516ae236d0c_244) |
| [ITEM 14.](#iab8ee63cdd734c278196d516ae236d0c_247) | <u>[PRINCIPAL ACCOUNTANT FEES AND SERVICES](#iab8ee63cdd734c278196d516ae236d0c_247)</u> | [97](#iab8ee63cdd734c278196d516ae236d0c_247) |
| <u>[PART IV](#iab8ee63cdd734c278196d516ae236d0c_250)</u> | | [99](#iab8ee63cdd734c278196d516ae236d0c_250) |
| [ITEM 15.](#iab8ee63cdd734c278196d516ae236d0c_256) | <u>[EXHIBITS AND FINANCIAL STATEMENT SCHEDULES](#iab8ee63cdd734c278196d516ae236d0c_256)</u> | [100](#iab8ee63cdd734c278196d516ae236d0c_256) |
| [ITEM 16.](#iab8ee63cdd734c278196d516ae236d0c_259) | <u>[FORM 10-K SUMMARY](#iab8ee63cdd734c278196d516ae236d0c_259)</u> | [103](#iab8ee63cdd734c278196d516ae236d0c_259) |
| <u>[SIGNATURES](#iab8ee63cdd734c278196d516ae236d0c_262)</u> | <u>[SIGNATURES](#iab8ee63cdd734c278196d516ae236d0c_262)</u> | [104](#iab8ee63cdd734c278196d516ae236d0c_262) |

---

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**CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS** 

This Annual Report includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which statements are subject to considerable risks and uncertainties. Forward-looking statements relate to matters such as our business plans and strategies, trends impacting our business and industry, our consideration of strategic alternatives, liquidity, capital resources, investment strategies and other business, financial and operating information. Forward-looking statements include all statements that are not statements of historical facts, and can be identified by words such as "anticipate," "approximately," "assume," "believe," "contemplate," "continue," "could," "estimate," "expect," "future," "intend," "may," "plan," "potential," "predict," "project," "seek," "should," "target," "will" and similar terms and phrases in this Annual Report. All of our forward-looking statements include assumptions underlying or relating to such statements that may cause actual results to differ materially from those that we are currently expecting and are subject to considerable risks and uncertainties, including without limitation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to continue to satisfy the requirements of an exemption from the registration requirements of the Investment Company Act of 1940, as amended (the "Investment Company Act"), and to manage our asset composition and strategy in compliance with such exemption;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the risk that we could be deemed to be an investment company required to register under the Investment Company Act, which would subject us to significant regulatory requirements and could materially affect our operations, capital structure and flexibility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to successfully invest our liquid assets while preserving capital and liquidity and generating returns sufficient to offset our ongoing corporate expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impact of changes in interest rates, credit markets, and general economic conditions on the value and yields of our investments;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to identify, evaluate, and consummate strategic alternatives, including acquisitions, investments, or other capital allocation transactions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to identify and successfully take advantage of strategic investment and acquisition opportunities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to remediate the material weakness identified in our internal control over financial reporting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*•* the impact of the restatement of our previously issued consolidated financial statements for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements as of and for the first three quarters of the years ended December 31, 2022 and December 31, 2023;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the response of federal and state taxing authorities to the amended 2022 tax returns that we have filed seeking federal and state tax refunds as a result of the restatement of our financial statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• developments associated with fluctuations in the economy, including recession, reduced consumer confidence, increased inflation or geopolitical uncertainty;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the negative impact of information technology security breaches and other such infrastructure disruptions on our business operations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impact of new accounting pronouncements or updates to existing accounting standards; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• other risks and uncertainties discussed in Part I, Item 1A, *Risk Factors*, in this Annual Report.

The forward-looking statements in this Annual Report are based on management's plans as of the date of this filing, as well as estimates and expectations in light of information currently available to us, all of which are subject to uncertainty and changes in circumstances. Actual results may differ materially from our expectations due to changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors, many of which are beyond our control, as well as the other factors described in Part I, Item 1A, *Risk Factors,* in this Annual Report and in the other reports we file with the Securities and Exchange Commission ("SEC").

Additional factors or events that could cause our actual results to differ may also emerge from time to time, and it is not possible for us to predict all of them. Should one or more of the existing risks or uncertainties materialize, should any of our current assumptions or estimates prove to be incorrect, or should new risks and uncertainties materialize as we navigate changes to the business over time, our actual results may be different from, and potentially materially worse than, what we may have expressed or implied by these forward-looking statements. Comparisons of results for any current or

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prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

Investors should not place undue reliance on any of our forward-looking statements. Any forward-looking statement made by us in this Annual Report speaks only as of the date hereof. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as may be required by applicable securities laws. We qualify all of our forward-looking statements by these disclaimers.

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**EXPLANATORY NOTE**

As previously disclosed on Forms 12b-25 filed with the Securities and Exchange Commission on May 16, 2025, September 3, 2025, December 10, 2025, and April 1, 2026, the registrant has not timely filed its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025, June 30, 2025 and September 30, 2025, or its Annual Report on Form 10-K for the year ended December 31, 2025.

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**PART I**

**ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BUSINESS** 

**General** 

Harbor is a non-operating holding company that is the parent of a consolidated group of subsidiaries, including AWAC Aviation, Inc. ("AWAC"), which, until January 9, 2026, was the sole member of Air Wisconsin Airlines LLC ("Air Wisconsin"), which is an air carrier. Harbor is also the direct parent of three other subsidiaries: (1) Lotus Aviation Leasing, LLC ("Lotus"), which leased flight equipment to Air Wisconsin, (2) Air Wisconsin Funding LLC ("AWF"), which provided flight equipment financing to Air Wisconsin, and (3) Harbor Therapeutics, Inc. ("Therapeutics"), which is a non-operating entity with no material assets. As previously disclosed, on January 9, 2026, Harbor completed the last in a series of transactions pursuant to which it disposed of all of its aviation assets, including its membership interests in Air Wisconsin (the completion of all such transactions, collectively, the "Aviation Disposition"). For additional information, please refer to the sections titled "—*Aviation Disposition*" and "—*Organizational Structure,*" in this Annual Report**.**

Because Harbor consolidated Air Wisconsin for financial statement purposes prior to the Aviation Disposition, for purposes of this Annual Report, disclosures relating to activities of Air Wisconsin also apply to Harbor, unless otherwise noted. Where reference is made only to Harbor Diversified, Inc. (such as when referring to the outstanding shares of common stock), it is referred to as "Harbor." Where reference is made only to Air Wisconsin (such as where it is named specifically for its historical contractual obligations and operations), it is referred to as "Air Wisconsin." Where reference is intended to include Harbor and its consolidated subsidiaries, they are jointly referred to as the "Company," "we," "us," or "our."

**Business Overview**

From its formation in 1965 until April 3, 2025, Air Wisconsin operated primarily as a regional airline affiliated with major airlines providing short and medium haul scheduled flights that connected smaller communities with larger cities and acting as a "feeder" for the major airlines' domestic and international airline hubs. From March 2023 until April 3, 2025, Air Wisconsin provided regional airline services for American Airlines, Inc. ("American") pursuant to a capacity purchase agreement (the "American capacity purchase agreement") that it had entered into with American in August 2022. Prior to early June 2023, Air Wisconsin provided regional airline services for United Airlines, Inc. ("United") pursuant to a capacity purchase agreement (the "United capacity purchase agreement") entered into in 2017. For the year ended December 31, 2024, substantially all of our operating revenue was derived from operations associated with the American capacity purchase agreement. For the year ended December 31, 2023, approximately 63.8% of our operating revenue was derived from operations associated with the American capacity purchase agreement and approximately 36.0% of our operating revenue was derived from operations associated with the United capacity purchase agreement. As of December 31, 2024, Air Wisconsin owned a fleet of 63 CRJ-200 regional jets, manufactured by Bombardier, Inc., of which 45 were in service under the American capacity purchase agreement, and the remaining aircraft were not in service.

On January 3, 2025, American gave notice to Air Wisconsin of the termination of the American capacity purchase agreement, effective April 3, 2025. Given the dynamics in the airline industry, including the decision by multiple major airlines to eliminate from their fleets single class 50-seat aircraft, such as those owned by Air Wisconsin, we realized that it was unlikely Air Wisconsin would be able to enter into a new capacity purchase agreement with a major airline to provide regional airline service. As a result, on January 10, 2025, Air Wisconsin announced a strategic realignment of its business strategies. As part of that contemplated realignment, Air Wisconsin began exploring various business opportunities, including (1) expanding its charter operations; (2) focusing on Essential Air Service Program ("EAS") markets; and (3) transitioning its relationship with American to a codeshare and interline relationship. These efforts did not lead to sustainable operations or positive financial results.

During the first and second quarters of 2025, and, with respect to possible EAS operations, into the third quarter, Air Wisconsin continued to evaluate the viability of various business opportunities and strategic alternatives. However, following termination of the American capacity purchase agreement, Air Wisconsin's level of flying was drastically reduced relative to the level of flying before the termination, and there were periods during which Air Wisconsin operated no flights. Air Wisconsin concluded that it was unlikely to be successful in executing on any of the strategies it was exploring. As a result, it (1) commenced a series of reductions in its workforce, (2) sold certain aircraft, engines and parts, and (3) closed certain operational facilities, all in an attempt to reduce operating expenses, generate cash proceeds, and slow the reduction in its cash reserves. In addition, Air Wisconsin experienced significant voluntary workforce attrition.

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Nevertheless, given the reduction in the number of flights following termination of the American capacity purchase agreement, Air Wisconsin's expenses continued to significantly exceed its revenues, and Air Wisconsin anticipated that this situation could continue indefinitely.

**Aviation Disposition**

In the second and third quarters of 2025, Air Wisconsin began exploring other strategic alternatives, including the sale of its business or of substantially all of its assets, either in one transaction or a series of transactions. Management had discussions with several different parties and considered various proposals from interested parties, some of which were interested in acquiring Air Wisconsin's DOT operating certificate and others of which were interested in acquiring some of Air Wisconsin's aircraft, engines or other assets. The primary factors Air Wisconsin considered in analyzing various proposals included anticipated deal consideration, legal structure, expected tax implications, regulatory timing and impacts, and certainty of closing.

The strategic review process resulted in several sales of our aviation assets in the third and fourth quarters of 2025 and culminated in the sale of Air Wisconsin's membership interests and all other remaining aviation assets on January 9, 2026. For additional information, please refer to Harbor's Current Report on Form 8-K filed with the SEC on January 15, 2026. The aggregate consideration received in connection with the Aviation Disposition was approximately $125.9 million, subject to certain customary purchase price adjustments and the impact of required tax obligations.

After giving effect to the Aviation Disposition, neither Harbor nor any of its remaining subsidiaries has any material operating assets or infrastructure to support an airline, provided that we did retain certain non-operating assets, which primarily relate to lease payments for a single aircraft, insurance claims, and state and federal tax refunds.

We currently do not have any material operating assets, are not engaged in any operating business, and do not have any source of revenue from operations.

**Certain Trends and Uncertainties Affecting Our Historical Business and Industry** 

The following trends and uncertainties affecting Air Wisconsin's business and industry affected its performance and prospects during the periods covered by this Annual Report, but are not expected to impact our business after giving effect to the Aviation Disposition.

***Reduced Reliance on 50- Seat Aircraft***

Major US airlines have announced their intention to replace smaller aircraft having fewer seats with larger aircraft having more seats. This could lead to the eventual elimination of single-class 50-seat regional jets, such as the CRJ-200 regional jets historically operated by Air Wisconsin, from their fleets. Delta Airlines has phased out all of the CRJ-200 regional jets formerly in its fleet, and American has announced that it intends to eliminate all 50-seat aircraft from its operations by 2030. This trend made it unlikely that Air Wisconsin would be able to enter into a capacity purchase agreement with a major airline, caused Air Wisconsin to seek alternative uses for its aircraft, and is a factor that contributed to our decision to pursue the Aviation Disposition.

***Personnel Shortages and Costs***

Historically, the airline industry has experienced periodic shortages of qualified personnel, particularly pilots and mechanics. As flight demand increased throughout 2023 and 2024, these shortages became acute, particularly for regional airlines such as Air Wisconsin. This trend was due to a number of factors, including retirements and employees seeking opportunities at mainline and other carriers and in other industries. As a result of the pilot shortage and attrition, Air Wisconsin increased overall hourly pay for pilots and offered recruiting bonuses generally consistent with those offered by its competitors. In addition, the pilot shortage limited the number of revenue producing block hours that Air Wisconsin was able to provide under the American capacity purchase agreement in 2023 and early 2024. However, airline personnel costs are no longer relevant to us following the Aviation Disposition.

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***Ruling in United Arbitration and Restatement of Financial Statements***

Prior to its termination, a dispute arose under the United capacity purchase agreement. Air Wisconsin claimed that United owed it certain amounts under the capacity purchase agreement. United denied that it owed those amounts and claimed that Air Wisconsin improperly terminated the agreement and that Air Wisconsin owed it certain amounts for the alleged wrongful termination. In October 2022, United initiated arbitration under the agreement. The arbitrators issued their decision in February 2024 (the "United Arbitration Award"). They denied Air Wisconsin's claims that United owed it amounts under the United capacity purchase agreement and denied United's claim that Air Wisconsin breached the agreement by terminating it and its claim that Air Wisconsin owed it damages. As a result, neither party owed to the other party any amounts claimed in the arbitration. Following an extensive review of the complex accounting treatment of the amounts disputed in the arbitration, we concluded that our prior determination to recognize all such amounts was inconsistent with the technical requirements of Accounting Standards Codification Topic 606, *Revenue from Contracts with Customers* ("ASC 606"). This led to a determination that the previously issued consolidated financial statements for certain periods should no longer be relied upon and that such financial statements should be restated.

Please refer to the "*Explanatory Note*" in our Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Annual Report"), and Note 2, *Restatement of 2022 Consolidated Financial Statements*, and Note 20, *Restatement of Prior Quarterly 2023 and 2022 Condensed Consolidated Financial Statements (Unaudited)*, in the notes to the audited consolidated financial statements included in the 2023 Annual Report, for additional information on the restatement of, and the related effects on, our consolidated financial statements for the subject periods.

**Our Business Strategy**

As noted above, after giving effect to the Aviation Disposition, we do not have any material operating assets, are not engaged in any operating business, and do not have any sources of revenue from operations. Our remaining assets are predominantly comprised of cash and cash equivalents, restricted cash, and marketable securities (collectively, the "Liquid Assets"). We have a significant amount of Liquid Assets with no material indebtedness.

We are currently in the process of evaluating potential strategic alternatives, which may include investments in, or acquisitions of, one or more businesses, assets, technologies, joint ventures, or other strategic opportunities. Any such transactions could involve one or multiple investments or acquisitions, be in any number of industries or lines of business (which may or may not include the airline industry), and involve the use of cash, equity securities, or a combination thereof. In addition, we may pursue other strategic alternatives, which could include, without limitation, the issuance of one or more cash dividends, share repurchases, tender offers, registering as an investment company, a liquidation, or other potential transactions. No decision has been made regarding the pursuit of any particular strategic alternative, and we cannot predict when a decision will be made. There can be no assurance that we will be successful in identifying, pursuing or executing any particular strategic transaction or alternative, or that any such action will result in enhanced stockholder value.

Since our remaining assets are predominantly comprised of cash and cash equivalents, restricted cash and marketable securities, we could potentially be deemed an "investment company" pursuant to the Investment Company Act. Becoming an investment company would impose additional regulatory and disclosure requirements on us, compliance with which could be expensive and time-consuming. The Investment Company Act provides a number of exemptions, including a one-year safe harbor for companies that are seeking to acquire an operating business. We intend to avail ourself of this exemption. If we are not able to meet the requirements of the exemption, we may be required to register as an investment company, seek the availability of a different exemption, or pursue an alternative strategy.

In furtherance of our intention to comply with the safe harbor exemption, we have adopted an investment policy with the primary objectives of (1) ensuring the safety of capital and preservation of purchasing power, (2) preserving liquidity, (3) maintaining short-term maturities, and (4) managing towards reasonable rates of return in light of the other investment objectives. Consistent with the investment policy, our liquid assets are primarily invested in deposit accounts, money market funds, government-backed securities and similar investments.

**Historical Aircraft Fleet** 

As of December 31, 2024, Air Wisconsin owned 63 CRJ-200 regional jets, each of which was configured for single class seating. As a result of the Aviation Disposition, we no longer own any regional jets.

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**Historical Operating Data** 

The following table sets forth our major operational statistics and the associated percentage changes for the periods presented:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, | Year Ended<br>December 31, | Year Ended<br>December 31, | | | |
| | 2024 | 2024 | 2023 | 2023 | Change | Change | Change |
| **Operating Data:** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available Seat Miles ("ASMs") (in thousands) | 732446 | 732446 | 905729 | 905729 | (173283) | (173283) | (19.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual Block Hours | 74742 | 74742 | 87011 | 87011 | (12269) | (12269) | (14.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual Departures | 54001 | 54001 | 61769 | 61769 | (7768) | (7768) | (12.6%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenue Passenger Miles ("RPMs") (in thousands) | 607135 | 607135 | 759844 | 759844 | (152709) | (152709) | (20.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Average Stage Length (in miles) | 278 | 278 | 301 | 301 | (23) | (23) | (7.6%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract Revenue Per Available Seat Mile (in cents) | 27.63 | ¢ | 21.95 | ¢ | 5.68 | ¢ | 25.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Passengers | 2154829 | 2154829 | 2502123 | 2502123 | (347294) | (347294) | (13.9%) |

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**United Capacity Purchase Agreement** 

United and Air Wisconsin entered into the United capacity purchase agreement in February 2017 pursuant to which United agreed to purchase the capacity of the Air Wisconsin CRJ-200 regional jets covered under the agreement. Air Wisconsin commenced flying under the United capacity purchase agreement in September 2017, and the agreement terminated in early June 2023.

United set the flight schedules for covered aircraft, subject to certain reasonable operating constraints. United also established all fares, controlled route selection, pricing, seat inventories, and marketing, collected all revenue, and provided airport landing slots, terminal facilities and ground handling services for any flights operated by Air Wisconsin pursuant to the agreement. Air Wisconsin provided the flight and cabin crew and was responsible for dispatch and operational control of each covered aircraft as well as any required maintenance. When providing flight services for United, Air Wisconsin used United's logos, service marks and aircraft paint scheme.

In exchange for providing flight services under the United capacity purchase agreement, Air Wisconsin was entitled to receive a fixed payment for the covered aircraft and a fixed payment for each departure and block hour flown. Air Wisconsin could also earn incentive payments, and was subject to penalty payments, based upon its operational performance and the results of customer satisfaction surveys. In addition, Air Wisconsin was entitled to the payment or accrual of certain amounts by United based on certain scheduling benchmarks. United also reimbursed Air Wisconsin for certain costs on an actual basis, including aviation insurance, aircraft property tax per aircraft and air navigation fees. Costs relating to fuel and certain landing fees owed by Air Wisconsin were directly paid to suppliers by United.

**American Capacity Purchase Agreement**

In August 2022, Air Wisconsin entered into a capacity purchase agreement with American, pursuant to which Air Wisconsin agreed to provide up to 60 CRJ-200 regional jet aircraft for regional airline services for American. Air Wisconsin's flights were marketed by American as American Eagle flights. In January 2025, American exercised its right under the American capacity purchase agreement to terminate the agreement, and the agreement terminated effective April 3, 2025, at which point all of Air Wisconsin's aircraft were removed from service for American.

Under the American capacity purchase agreement Air Wisconsin was entitled to receive certain payments based on the number of aircraft covered under the agreement, block hours, departures and certain performance metrics. Air Wisconsin was also eligible to receive bonus compensation, and was required to pay rebates, upon the achievement of, or failure to achieve, certain pre-established performance criteria.

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Air Wisconsin was responsible for certain customary costs relating to the flight operation and maintenance of the covered aircraft along with other customary controllable expenses, including expenses associated with flight crews, line maintenance and overhead. American reimbursed Air Wisconsin for certain customary costs and expenses incurred in connection with Air Wisconsin's flight operations, including fuel, landing and air traffic control, changes to livery and branding, aircraft and passenger liability insurance, property taxes and systems support.

American had the right to schedule all aircraft covered by the agreement, including determining route selection and frequency, and the timing of scheduled arrivals and departures, in each case subject to certain scheduling parameters. American also had the right to determine and publish fares and to establish seat inventories, overbooking levels, and allocation of seats among fare categories. Furthermore, American provided all ground handling services, including gate and ticket counter services, baggage handling, cargo handling, aircraft loading/unloading services, passenger ticketing, and aircraft cabin cleaning. American had the right to all revenues resulting from the sale of passenger tickets associated with the covered aircraft and all other sources of revenue associated with the operation of the covered aircraft, including revenues relating to baggage charges, food and beverage sales and ticket change fees. The American capacity purchase agreement protected Air Wisconsin, to an extent, from many of the elements that typically cause volatility in airline financial performance, including fuel prices, variations in ticket prices, and fluctuations in the number of passengers, but it also prevented Air Wisconsin from benefiting from certain factors, such as reductions in fuel prices, increases in ticket prices and increases in passenger demand.

As of December 31, 2024, Air Wisconsin had 45 aircraft in service for American. Except as otherwise permitted in the agreement, the aircraft covered by the agreement could only be used by Air Wisconsin to provide regional airline services for American and could not be used by Air Wisconsin for any other purpose, including flight operations for any other airline. In addition, Air Wisconsin was subject to certain limitations on its ability to use aircraft not covered by the agreement in passenger operations.

After giving effect to the Aviation Disposition, neither Harbor nor any of its remaining subsidiaries has any material operating assets or infrastructure to support an airline. For additional information, please refer to Note 1, *Summary of Significant Accounting Policies*, and Note 15, *Subsequent Events,* in the notes to the audited consolidated financial statements in this Annual Report.

**Maintenance and Repairs** 

Airlines are subject to extensive regulation. As of December 31, 2024, Air Wisconsin had an FAA mandated and approved maintenance program. Aircraft maintenance and repair consisted of routine and non-routine maintenance, and work performed was divided into three general categories: line maintenance, heavy maintenance and component service. Air Wisconsin also outsourced certain aircraft, engine and other component maintenance functions. To procure these services, Air Wisconsin used competitive bidding among qualified vendors.

Line maintenance consisted of routine daily and weekly scheduled maintenance checks on Air Wisconsin's aircraft. Line maintenance was performed at certain locations throughout Air Wisconsin's operation and represented the majority of the maintenance Air Wisconsin performed. Heavy maintenance consisted of a series of major airframe maintenance checks that could take from one to six or more weeks to accomplish. Component service included engine overhauls and engine performance restoration events, which could take several months. Air Wisconsin maintained an inventory of spare engines at both Air Wisconsin and Lotus to provide for continued operations during scheduled and unscheduled engine maintenance events. Air Wisconsin provided maintenance services for its CRJ-200 regional jets and for its owned and leased engines and equipment. Air Wisconsin's maintenance and repair costs increased as its fleet aged.

Since the maintenance program remained with Air Wisconsin after the Aviation Disposition, we do not anticipate incurring any cost for airline maintenance or repairs.

**Competition** 

The regional airline industry is highly competitive. While Air Wisconsin operated under capacity purchase agreements, its primary competition were those U.S. regional airlines that had or competed for capacity purchase agreements with major airlines, including CommuteAir; Endeavor, Inc. (owned by Delta); Envoy Air, Inc., PSA Airlines, Inc. and Piedmont Airlines, Inc. (Envoy, PSA and Piedmont are owned by American); GoJet Airlines, LLC; Horizon Air Industries, Inc. (owned by Alaska Air Group, Inc.); Republic Airways Holdings Inc. (and, prior to November 2025, Mesa Airlines, Inc., which merged with Republic Airways in November 2025); and SkyWest Inc.

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Major airlines typically selected regional airline partners based on the following criteria: aircraft type, ability to fly proposed schedules; availability of labor resources, including pilots; economic terms; aircraft and engine resources; financial resources; operational reliability; reputation; customer service levels; and other factors. As noted above, most major airlines are reducing or eliminating single class 50-seat aircraft from their fleets.

In the new markets that Air Wisconsin had explored entering, including charter operations and essential air service markets, other competitors were larger, had more experience and had significantly greater financial and other resources than Air Wisconsin, which contributed to the difficulties Air Wisconsin faced in seeking to enter into these markets.

After giving effect to the Aviation Disposition, we do not expect to face the competitive dynamics of the airline industry.

**Aircraft Fuel** 

Airplane fuel is typically a material cost incurred by airlines, and fuel prices are subject to significant volatility, which can have a material impact on operating and financial results. Air Wisconsin's former capacity purchase agreements required that the major airline source, procure and directly pay third-party vendors for substantially all fuel used in the performance of the agreement, so Air Wisconsin was protected from volatility in fuel prices. It was unlikely that any contract Air Wisconsin might have entered into for flying services after the termination of the American capacity purchase agreement would require the counterparty to bear the cost of fuel, so Air Wisconsin would likely have been subject to fluctuations in fuel costs.

After giving effect to the Aviation Disposition, we do not expect to incur aircraft fuel costs.

**Insurance** 

At all times that Air Wisconsin was owned by AWAC, we maintained insurance policies we believed were of types customary for the airline industry and as required by the U.S. Department of Transportation (the "DOT") and contracting parties. The policies principally provided liability coverage for public and passenger injury; damage to property; loss of or damage to flight equipment; cybersecurity attacks; fire; auto; directors' and officers' liability; fiduciary liability; workers' compensation and employer's liability; and war risk (terrorism).

After giving effect to the Aviation Disposition, since we no longer have any material operating assets, we currently believe our insurance coverage is adequate. We will need to reevaluate our insurance coverage as strategic decisions are made and our business needs change.

**Employees** 

As of December 31, 2024, Air Wisconsin had a total of approximately 944 employees, of which 666 were represented by unions. Non-union employees were mainly management and administrative staff. Information regarding employees represented by unions as of December 31, 2024 is included in the table below:

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| | | | |
|:---|:---|:---|:---|
| **Union Groups** | **Number**<br>**of**<br>**Union**<br>**Employees** | **Representative** | **Collective**<br>**Bargaining**<br>**Agreement**<br>**Amendable Date** |
| Pilots | 316 | Air Line Pilots Association, International | October 11, 2026 |
| Flight Attendants | 138 | Association of Flight Attendants | October 1, 2022 |
| Dispatchers | 21 | Transport Workers Union of America | April 12, 2028 |
| Mechanics and Aircraft Cleaners | 162 | International Association of Machinists and Aerospace Workers AFL-CIO | September 20, 2023 |
| Clerical, Office, Fleet and Passenger Service | 29 | International Association of Machinists and Aerospace Workers AFL-CIO | September 20, 2022 |

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Prior to the Aviation Disposition, Air Wisconsin was never the subject of a labor strike or labor action that materially impacted its operations.

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FAA regulations require pilots to have an Airline Transport Pilot license with specific ratings for the aircraft to be flown and to be medically certified as physically fit to fly. FAA and medical certifications are subject to periodic renewal requirements including recurrent training and recent flying experience. Mechanics, quality-control inspectors, and flight dispatchers must be certificated and qualified for specific aircraft. Flight attendants must have initial and periodic competency training and qualification. Training programs are subject to approval and monitoring by the FAA. Management personnel directly involved in the supervision of flight operations, training, maintenance, and aircraft inspection must also meet experience standards prescribed by FAA regulations. All employees performing a safety-sensitive function are subject to pre-employment, random, and post-accident drug testing.

In response to the termination of the American capacity purchase agreement and the subsequent reduction in flying, Air Wisconsin furloughed a significant number of employees, and many other employees who were not furloughed voluntarily terminated their employment with Air Wisconsin.

After giving effect to the Aviation Disposition, we have a small number of employees, executive officers and advisors who manage our day-to-day affairs, oversee our remaining assets and obligations, evaluate strategic alternatives and execute any transaction we may pursue.

**Safety and Security** 

At all times that Air Wisconsin was owned by us, we were committed to the safety and security of Air Wisconsin's passengers and employees and to complying with safety and security requirements. Air Wisconsin took many steps, both voluntarily and as mandated by governmental authorities, to increase the safety and security of its operations through the implementation of a corporate-wide Safety Management System, which was designed to support its organizational culture that held safety and security as essential core values. Air Wisconsin continually worked to create and foster a culture of safety, security and compliance that proactively identified and managed risks to the operation and workplace before they could become injuries, incidents or accidents.

Safety and security in the workplace targeted several areas of Air Wisconsin's operation, including dispatch, flight operations, ground operations, and maintenance. Air Wisconsin's ongoing focus on safety and security relied on training Air Wisconsin's employees to proper standards and providing them with the tools and equipment they needed to perform their job functions in a safe and efficient manner.

**Government Regulation** 

***Aviation Regulation***

The DOT and FAA have regulatory authority over air transportation in the United States. All foreign air transportation is subject to certain U.S. federal requirements and approvals, as well as the regulatory requirements of the appropriate authorities of the foreign countries involved. The DOT has authority to issue certificates of public convenience and necessity, exemptions and other economic authority required for airlines to provide domestic and foreign air transportation. International routes and international code-sharing arrangements are regulated by the DOT and by the governments of the foreign countries involved. A U.S. airline's ability to operate flights to and from international destinations is subject to the air transport agreements between the United States and the foreign country and the carrier's ability to obtain the necessary authority from the DOT and the applicable foreign government.

The FAA is responsible for regulating and overseeing matters relating to the safety of air carrier flight operations, including the control of navigable air space, the qualification of flight personnel, flight training practices, compliance with FAA airline operating certificate requirements, aircraft certification and maintenance requirements. The FAA requires each commercial airline to obtain and hold an FAA air carrier certificate. At all times that Air Wisconsin was owned by AWAC, it held an air carrier certificate with Federal Aviation Regulation Part-121 operation specifications.

The Transportation Security Administration ("TSA") is responsible for certain civil aviation security matters, including passenger and baggage screening at U.S. airports. At all times that Air Wisconsin was owned by AWAC, Air Wisconsin was in compliance with the directives issued by the TSA and maintained active, open lines of communication with the TSA to ensure that proper standards for security of its personnel, equipment and facilities were exercised throughout its operation.

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***Foreign Ownership***

Under DOT regulations and federal law, at all times that Air Wisconsin was owned by AWAC, Air Wisconsin was required to be owned and controlled directly and indirectly by citizens of the United States. The restrictions imposed by federal law and regulations required (i) that at least 75% of Air Wisconsin's voting equity securities be owned and controlled, directly and indirectly, by persons or entities who are citizens of the United States, as defined in the Federal Aviation Act and interpreted by the DOT, (ii) that Harbor's Chief Executive Officer, Air Wisconsin's President and Chief Executive Officer, and at least two-thirds of the members of Air Wisconsin's board of managers and Harbor's board of directors and other managing officers be citizens of the United States, and (iii) that Air Wisconsin and Harbor be under the actual control of citizens of the United States. In addition, at least 51% of Air Wisconsin's total outstanding equity securities were required to be owned and controlled, directly and indirectly, by citizens of the United States and no more than 49% of its equity securities could be held, directly or indirectly, by persons or entities who are not U.S. citizens and were from countries that have entered into "open skies" air transport agreements with the U.S. which allow unrestricted access on air service routes between the United States and the applicable foreign country and to points beyond the foreign country on flights serving the foreign country. No more than 25% of Air Wisconsin's equity securities could be held, directly or indirectly, by persons or entities who were not U.S. citizens and were from countries that have not entered into an "open skies" air transport agreement with the U.S. At all times that Air Wisconsin was owned by AWAC, we were in compliance with these ownership provisions. In addition, Harbor's amended and restated certificate of incorporation and Harbor's amended and restated bylaws currently prohibit the transfer of any shares of Harbor's capital stock that would result in (i) any person or entity becoming a "Five-Percent Stockholder" (as defined under Treasury Regulation Section 1.382-2T(g)) of our then-outstanding capital stock, or (ii) an increase in the percentage ownership of any person or entity who is already a "Five-Percent Stockholder" of our then-outstanding capital stock. These restrictions on the transfer of Harbor's capital stock inhibit the acquisition of control of Air Wisconsin by any foreign citizen.

***Consumer Protection Regulation***

The DOT also asserts regulatory authority over certain consumer protection matters related to air transportation. These matters include unfair or deceptive practices, unfair methods of competition, advertising, denied boarding compensation, disclosure of certain ancillary fees, ticket refunds, baggage liability, contracts of carriage, frequent flyer programs, customer service commitments, customer complaints and transportation of passengers with disabilities. The DOT has adopted consumer protection rules regulating lengthy tarmac delays, chronically delayed flights, codeshare disclosure and undisclosed display bias. The DOT also has authority to review certain joint venture agreements, code-sharing agreements (where an airline places its designator code on a flight operated by another airline) and wet-leasing agreements (where one airline provides aircraft and crew to another airline) between carriers and regulates other economic matters such as slot transactions.

***Environmental Regulation***

Air Wisconsin was subject to various federal, state, local and foreign laws and regulations relating to environmental protection matters. These laws and regulations govern such matters as environmental reporting, storage and disposal of materials and chemicals and aircraft noise. As of December 31, 2024, and during the period from that date to the date of the Aviation Disposition, Air Wisconsin was not subject to any environmental cleanup orders or actions imposed by regulatory authorities.

The Environmental Protection Agency regulates operations, including air carrier operations, which affect the quality of air in the United States.

Federal law recognizes the right of airport operators with special noise problems to implement local noise abatement procedures so long as those procedures do not interfere unreasonably with interstate and foreign commerce and the national air transportation system. These restrictions can include limiting nighttime operations, directing specific aircraft operational procedures during takeoff and initial climb, and limiting the overall number of flights at an airport.

Through the use of software and training, Air Wisconsin managed its fuel usage in an effort to conserve fuel and reduce emissions. When possible, Air Wisconsin mitigated fuel usage by taxiing with the use of a single engine, improved the efficiency of aircraft routing, and used ground power when an aircraft was parked at the gate. Air Wisconsin also implemented recycling initiatives and worked aggressively to reduce its reliance on paper manuals and logs.

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***Other Regulations***

Airlines are also subject to various other federal, state, local and foreign laws and regulations, such as laws and regulations governing competition, labor relations and passenger and employee data. Federal, state, local and foreign governments may consider and adopt new laws, regulations, interpretations and policies regarding a wide variety of matters.

After giving effect to the Aviation Disposition, we are no longer subject to the various federal, state, local, and foreign laws and regulations to which airlines are subject.

**Trademarks** 

Air Wisconsin, the Air Wisconsin logo, and its other registered or common law trade names, trademarks, or service marks appearing in this Annual Report are Air Wisconsin's intellectual property. After giving effect to the Aviation Disposition, Air Wisconsin is no longer one of our subsidiaries.

This Annual Report contains additional trade names, trademarks, and service marks of other companies that are the property of their respective owners. We do not intend our use or display of other companies' trade names, trademarks, or service marks to imply a relationship with, or endorsement or sponsorship of us, by these companies. We have omitted the <sup>®</sup> and <sup>™</sup> designations, as applicable, for the trademarks used in this Annual Report.

**Organizational Structure** 

After giving effect to the Aviation Disposition, Harbor is a non-operating holding company that is the parent of a consolidated group of four non-operating subsidiaries: AWAC, Lotus, AWF, and Therapeutics, which are described below:

***AWAC Aviation, Inc.***

Prior to the Aviation Disposition, AWAC was a holding company the primary asset of which was its membership interests in Air Wisconsin. Air Wisconsin's historical business and operations are described in detail throughout this Annual Report. Since those membership interests were disposed of in the Aviation Disposition, AWAC's primary assets currently are cash and cash equivalents and marketable securities.

***Lotus Aviation Leasing, LLC***

Lotus was established to acquire and lease flight equipment to Air Wisconsin to support its flight operations. As of December 31, 2024, Lotus owned 47 engines. After giving effect to the Aviation Disposition, Lotus no longer owns any engines, and its primary assets are cash and cash equivalents and marketable securities.

***Air Wisconsin Funding LLC***

AWF was established to provide flight equipment financing to Air Wisconsin. As of December 31, 2024, Air Wisconsin had no outstanding balance under a $35.0 million credit facility with AWF. As of the date of the filing of this Annual Report, no amounts are outstanding under the credit facility, which has expired, and no further funds are available to be borrowed thereunder. Currently, AWF's primary assets are cash and cash equivalents and marketable securities.

***Harbor Therapeutics, Inc.***

Therapeutics is a non-operating entity with no material assets.

**Corporate Information** 

Harbor is a Delaware corporation headquartered in Appleton, Wisconsin. It was originally formed in November 1992 as Initial Acquisition Corp. In March 1997, Initial Acquisition Corp. was merged with Hollis-Eden, Inc., becoming Hollis-Eden Pharmaceuticals, Inc. In February 2010, Hollis-Eden Pharmaceuticals, Inc. was merged with its wholly owned subsidiary and renamed Harbor BioSciences, Inc. In January 2012, Harbor acquired 80% of the issued and outstanding capital stock of AWAC from Amun LLC ("Amun"), and in January 2016, Harbor acquired the remaining 20% of the issued and outstanding capital stock of AWAC from Amun. AWAC owns all of the equity interests of Air Wisconsin. In February 2012, Harbor BioSciences, Inc. was merged with its wholly owned subsidiary and renamed Harbor Diversified, Inc.

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**Public Reporting Obligation** 

Harbor is currently required to file certain reports and information with the SEC pursuant to Section 15(d) of the Exchange Act. The reports and other information Harbor files with the SEC are available to the public at the SEC's website at *http://www.sec.gov*.

Harbor is not currently in compliance with its reporting obligations under Section 15(d) of the Exchange Act because it has not timely filed all required periodic reports with the SEC.

Harbor does not have a class of securities registered pursuant to Section 12(b) or Section 12(g) of the Exchange Act. As a result, Harbor is not required to comply with, and does not intend to follow, certain disclosure requirements typically applicable to public reporting companies, including the requirement to file proxy statements, information statements, tender offer disclosures, and beneficial ownership filings.

If Harbor becomes eligible to suspend its public reporting obligations in future periods, it may elect to take the actions necessary to suspend those obligations, which could result in Harbor no longer being required to file certain reports and information with the SEC.

**ITEM 1A.&nbsp;&nbsp;&nbsp;&nbsp; RISK FACTORS** 

*Our short- and long-term success is subject to numerous risks and uncertainties, many of which involve factors that are difficult to predict or beyond our control. As a result, investing in Harbor's common stock involves substantial risk. Before deciding to purchase or sell Harbor's common stock, stockholders should carefully consider the risks and uncertainties described below, in addition to the other information contained in or incorporated by reference into this Annual Report, as well as the other information we file with the SEC from time to time. If any of these risks are realized, our business, financial condition, results of operations, liquidity and prospects could be materially and adversely affected. In that case, the value of Harbor's common stock could decline, and stockholders may lose all or part of their investment. Furthermore, additional risks and uncertainties of which we are currently unaware, or which we currently consider to be immaterial, could have a material adverse effect on our business.*

*After giving effect to the Aviation Disposition, we no longer have any material operating assets and, in particular, no longer confronts the risks of operating an airline. Therefore, the risk factors set forth below are limited to those we believe to be relevant from and after the date on which this Annual Report was filed, and we have not restated the risk factors related to our business and industry as they existed during the historical reporting periods covered by this Annual Report. For a discussion of the risks and uncertainties that were relevant to our business and industry during the historical reporting periods covered by this Annual Report, please refer to the section titled "Risk Factors" included in our prior SEC filings, including our 2023 Annual Report and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, which are incorporated herein by reference.*

*Certain statements made in this section constitute "forward-looking statements," which are subject to numerous risks and uncertainties including those described in this section. For additional information, please refer to "Cautionary Note Regarding Forward-Looking Statements" in this Annual Report.*

**Regulatory and Legal Risks** 

***If Harbor is deemed to be an "investment company" under the Investment Company Act, it would need to register as an investment company and would become subject to substantial regulatory requirements.***

As a result of the Aviation Disposition, we no longer have any material operating assets, are not engaged in any operating business, and do not have any source of revenue from operations. Its primary assets consist of cash and cash equivalents, restricted cash and marketable securities. As such, we may be deemed to be an "investment company" under the Investment Company Act.

A company may be deemed to be an investment company under Section 3(a)(1)(C) of the Investment Company Act ("Section 3(a)(1)(C)") if the value of its investment securities is more than 40% of its total assets (exclusive of government securities and cash items) on an unconsolidated basis. The activities of investment companies are restricted, including by restrictions on the nature of investments and the issuance of securities. In addition, investment companies may

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be subject to burdensome requirements, including registration as an investment company, adoption of a specific form of corporate structure, and reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations, compliance with which can be expensive and time-consuming. Additionally, the business activities of a registered investment company are significantly constrained, which could limit the company's ability to pursue certain strategic alternatives, including investments, acquisitions or other strategic transactions. If we were to determine that becoming an investment company was preferable to other options available to us, we would become subject to all of those restrictions and burdens. If we meet the definition of an investment company but fail to register when required, we could be subject to regulatory sanctions and civil or criminal penalties. The consequences of being deemed an investment company would have a material adverse effect on our business, financial condition, and prospects.

***We intend to rely on the transient investment company exemption under Rule 3a-2 of the Investment Company Act, which provides only temporary relief and is subject to significant conditions and limitations.***

Rule 3a-2 under the Investment Company Act ("Rule 3a-2") temporarily relieves certain issuers that are in transition to a non-investment company business due to the occurrence of an extraordinary event, such as the sale of all or substantially all of its operating assets, from the registration and other requirements of the Investment Company Act. Rule 3a-2 allows a "transient investment company" a grace period of one year from the earlier of (a) the date on which the company owns securities and/or cash having a value exceeding 50% of the its total assets on either a consolidated or unconsolidated basis and (b) the date on which it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of government securities and cash items) on an unconsolidated basis (the "Transient Period") to become compliant with Section 3(A)(1)(C) or otherwise find another exemption or exclusion from the definition of "investment company" (the "Transient Investment Company Exemption").

For Harbor to avail itself of the Transient Investment Company Exemption, it must, among other things, have a *bona fide* intent to be engaged, as soon as reasonably possible, and in any event within one year of becoming a transient investment company, in a business other than that of investing, reinvesting, owning, holding or trading in securities, and that intent is required to be evidenced by an appropriate board resolution and the company's business activities during the Transient Period. If Harbor is deemed to be an investment company, we intend to qualify for the Transient Investment Company Exemption and believe we have met, and will continue to meet, the requirements of the exemption. Harbor's board of directors has adopted a resolution confirming our intention to rely on the Transient Investment Company Exemption and confirming that we have met the requirements of the exemption. In furtherance of this determination, Harbor's board of directors has adopted an investment policy with the primary objectives of (1) ensuring the safety of capital and preservation of purchasing power, (2) preserving liquidity, (3) maintaining short-term maturities, and (4) managing towards reasonable rates of return in light of the other investment objectives. Consistent with the investment policy, our Liquid Assets are primarily invested in deposit accounts, money market funds, government-backed securities and similar investments.

The Transient Investment Company Exemption provides only a temporary exemption during the Transient Period and may only be relied upon once during any three-year period. If we are unable to complete a qualifying transaction within the Transient Period, we would no longer be able to rely on the Transient Investment Company Exemption and would need to either: (i) register as an investment company under the Investment Company Act, (ii) qualify for another exemption from registration, (iii) restructure our assets and business to avoid meeting the definition of an investment company, or (iv) liquidate.

There can be no assurance that we will satisfy the subjective *bona fide* intent requirement of the Transient Investment Company Exemption, that we will be able to consummate a strategic transaction within the Transient Period, or that we will be able to qualify for another exemption. Reliance on the Transient Investment Company Exemption may constrain our flexibility to make investments, pursue acquisitions or engage in joint ventures that involve securities as such actions could affect our investment asset ratios and jeopardize our ability to meet the exemption's conditions. Any actions taken to maintain an exemption from registration under the Investment Company Act, including any adjustment in our strategy, investments or assets could be costly and burdensome. If we are deemed to be an investment company and fail to comply with the registration requirements of the Investment Company Act, and are unable to avail ourselves of an applicable exemption, we could be subject to enforcement actions, regulatory sanctions, civil or criminal penalties and reputational harm.

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***We may have difficulty establishing that we qualify for a different exemption from registration under the Investment Company Act.***

In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exemption, we must ensure that we are not, and do not hold ourselves out as being, engaged primarily, or propose to engage primarily, in the business of investing, reinvesting or trading in securities, and that our activities do not include investing, reinvesting, owning, holding or trading "investment securities" constituting more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Other than the Transient Investment Company Exemption, there are limited exemptions under the Investment Company Act that may apply to a company in our situation. The primary alternative to the Transient Investment Company Exemption would be Section 3(b)(1) of the Investment Company Act ("Section 3(b)(1)"), which provides an exemption for any issuer primarily engaged in a business other than that of investing, reinvesting, owning, holding, or trading in securities. To qualify under Section 3(b)(1), we would need to demonstrate that we are primarily engaged in a non-investment company business. If we are unable to complete a strategic transaction that results in our primary engagement in a non-investment company business, we may not be able to qualify for an exemption from registration under the Investment Company Act.

***If we consummate a strategic transaction that allows us to cease to be deemed an investment company, our ability to invest our cash and cash equivalents will be restricted due to the need to avoid being deemed an investment company.***

If we consummate a strategic transaction and cease to be deemed an investment company, then in order to avoid being required to register as an investment company under the Investment Company Act in the future, we must carefully manage the composition of our assets. Specifically, we must ensure that we do not own "investment securities" having a value exceeding 40% of the value of our total assets (exclusive of government securities and cash items). The term "investment securities" is broadly defined under the Investment Company Act and includes most securities other than securities issued by the U.S. government and securities issued by majority-owned subsidiaries that are not themselves investment companies. These restrictions will limit our ability to invest our cash and cash equivalents in a manner that could generate higher returns, and we may be required to hold assets in lower-yielding investments such as bank deposits, money market funds, and government securities. This limitation may result in lower returns on our assets compared to what might otherwise be achievable if we were not subject to these restrictions.

**Investment Risks**

***We currently have no material operating assets and no operating business, and we may not be able to identify or successfully complete a suitable acquisition or other strategic transaction.***

As a result of the Aviation Disposition, we currently have no material operating assets, are not engaged in any operating business, and do not have any source of revenue from operations. Our future success largely depends on our ability to identify and execute a strategic alternative that creates value for our stockholders, which may include investments in or acquisitions of one or more businesses, assets, technologies, joint ventures, or other strategic opportunities. Any such transactions could involve one or multiple investments or acquisitions, be in any number of industries or lines of business (which may or may not include the airline industry), and involve the use of cash, equity securities, or a combination thereof.

The process of identifying and evaluating investment and acquisition opportunities, conducting due diligence, negotiating transaction terms, and integrating acquired businesses, assets or technologies is time-consuming and expensive and involves significant uncertainty. We may face significant competition for investments or acquisition targets from other potential acquirers, some of which may have greater resources and experience than we do. We may not be successful in identifying suitable acquisition targets on acceptable terms, or at all. If we do identify an acquisition target, we may not be able to negotiate terms that are favorable to us or complete the transaction due to regulatory, financing, or other obstacles. Even if we complete an acquisition, we may not be able to successfully integrate the acquired business or realize the anticipated benefits of the transaction, which could result in impairment charges or other losses.

In addition, we may pursue other strategic alternatives, which could include, without limitation, the issuance of one or more cash dividends to stockholders, share repurchases, tender offers, registering as an investment company, a liquidation, or other potential transactions. No decision has been made regarding the pursuit of any particular strategic alternative, and we cannot predict when a decision will be made. There can be no assurance we will be successful in identifying, pursuing, or executing any particular strategic transaction or alternative, or that any such action will result in enhanced stockholder value.

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***Investments, acquisitions and other strategic transactions present many risks, and our failure to successfully integrate any acquired business or assets into our operations could have a material adverse effect on our results of operations and financial condition.***

We may evaluate and consider potential strategic transactions, including acquisitions of, or investments in, one or more businesses, assets, technologies, alliances, and joint ventures or other strategic opportunities. Our ability to do so largely depends on our ability to identify and successfully pursue suitable investment and acquisition opportunities. Such investments and acquisitions involve numerous risks, challenges, and uncertainties, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the potential to expose us to risks inherent in entering into a new industry, market or geographic region;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to negotiate favorable contractual terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to comply with applicable regulations and receive necessary consents, clearances and approvals (including regulatory and antitrust clearances and approvals);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to successfully integrate separate businesses, operations, technology and personnel;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to realize the full extent of the benefits, cost savings or synergies presented by strategic transactions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to minimize potential losses of customers, business partners and key personnel;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to recover costs incurred relating to a potential acquisition that we fail to consummate; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• our ability to minimize indemnities and potential disputes with buyers, sellers and strategic partners.

In addition, execution or oversight of strategic transactions may result in the diversion of management's time and attention away from other aspects of our business and may present financial, managerial and operational risks, including disruptions in our business because of the allocation of resources to consummate these transactions.

With respect to acquisitions in particular, our failure to successfully structure or manage the transactions could have a material adverse effect on our financial condition and results of operations. The expected benefits of any acquisition may not be realized. In connection with any future acquisitions, we could face additional financial and operational risks beyond those described above, including, among other things, the dilution of our stockholders, if we issue equity to fund these transactions; reduced liquidity; increased debt and higher amortization expenses; assumption of operating losses, increased expenses and liabilities; discovery of unanticipated issues and liabilities; failure to meet expected returns; and difficulty in maintaining financial reporting and internal control processes.

***Our cash and investments may decline in value, and we may not be able to generate sufficient returns to offset our ongoing expenses.***

Our primary assets consist of cash and cash equivalents, restricted cash and marketable securities. Consistent with our investment policies, the Liquid Assets are primarily invested in deposit accounts, money market funds, government-backed securities, and similar investments, with the primary objectives of maintaining liquidity and preserving principal balances. These investments are subject to various risks. The value of our investments could decline due to changes in market conditions, rising or falling interest rates, defaults by issuers, or other factors beyond our control. Additionally, the returns on our investments may not be sufficient to offset our ongoing corporate expenses, including costs associated with maintaining our public company status, pursuing strategic alternatives, and compensating our management team. If our expenses exceed our investment returns over an extended period, the value of our Liquid Assets will decline, which would reduce the amount available for strategic transactions or pursuing other strategic opportunities, including the issuance of cash dividends to stockholders or share repurchases. Our investments will be subject to the following standard investment risks:

**Market volatility**: the value of our investment portfolio may fluctuate significantly due to market conditions, economic trends, geopolitical events or changes in investor sentiment;

**Concentration risk**: our investment portfolio could be negatively impacted if our assess are concentrated in a limited number of issuers, sectors or asset classes;

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**Interest rate risk**: changes in interest rates may adversely affect interest income and the value of fixed-income investments we hold;

**Credit risk**: issuers of securities we hold may default on their obligations, causing losses or reduced income; and

**Liquidity risk**: we may be unable to sell certain portfolio holdings at desirable prices or in a timely manner, especially during periods of market uncertainty or volatility.

***We have limited personnel and resources to evaluate and execute strategic alternatives.***

After giving effect to the Aviation Disposition, we have only a small number of employees, executive officers and advisors who manage our day-to-day affairs, oversee our remaining assets and obligations, evaluate strategic alternatives, and execute any transactions we may pursue. The loss of any of these key individuals could impair our ability to operate effectively and pursue our strategic objectives. Our limited personnel and resources may also limit the scope of opportunities we are able to evaluate and pursue. Additionally, potential acquisition targets or business partners may have concerns about our limited operational infrastructure and personnel, which could make it more difficult for us to consummate strategic transactions.

***Our stockholders may not agree with the strategic alternatives we pursue, and we may be unable to satisfy all stockholder expectations or enhance stockholder value.***

Our stockholders may have different views on what strategic alternatives would best serve their interests. Some stockholders may prefer that we return capital through cash dividends, share repurchases or tender offers, while others may prefer that we pursue acquisitions or other investments to grow our business. We may not be able to satisfy the expectations of all stockholders. Additionally, certain strategic alternatives, such as a sale of the Company, registration as an investment company, liquidation, or a significant acquisition, may require stockholder approval. There can be no assurance that our stockholders would approve any particular transaction. There can also be no assurance that any particular strategic transaction we pursue will result in enhanced stockholder value.

***A liquidation of the Company may result in distributions to stockholders that are less than expected or significantly delayed.***

One strategic alternative that we may consider is a liquidation of the Company and distribution of its remaining assets to stockholders. If we were to pursue a liquidation, the amount and timing of distributions to stockholders would be subject to significant uncertainty. We may be required to establish reserves for known and contingent liabilities, including potential claims that may arise after we announce or commence a liquidation. The amount of any such reserves would be determined by Harbor's board of directors in the exercise of its business judgment and may be more than is ultimately required, resulting in delayed or reduced distributions. Additionally, the process of liquidating our assets and winding down our affairs could take a significant period of time, during which we would continue to incur expenses that would reduce the amount available for distribution. Stockholders may not receive any distributions from a liquidation for an extended period, and the ultimate amount of distributions may be materially less than anticipated. Finally, any distribution could be subject to significant federal, state or local tax, depending upon a stockholder's personal financial situation. The tax consequences of any potential liquidation and distribution would likely be a significant consideration in determining whether to pursue a potential liquidation transaction.

***General Risk Factors***

***Information technology security breaches, hardware or software failures, or other information technology infrastructure disruptions may negatively impact our business, operations and financial condition.***

The performance and reliability of our and our third-party service providers' technology is critical to our success. Any internal technological error, failure or large-scale external interruption in the information systems, networks, hardware, software and technological infrastructure we depend on, such as power, telecommunications or the internet (collectively, "IT Systems"), may disrupt our internal network, impact our ability to conduct our business, and result in increased costs or penalties. Our IT Systems (including systems provided by third parties) may be vulnerable to a variety of sources of interruption due to events beyond our control, including natural disasters, terrorist attacks, telecommunications or IT System failures, computer viruses, cyber criminals and other security issues.

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In addition, we face numerous and evolving cybersecurity risks that threaten the security, confidentiality, integrity and availability of our IT Systems, including from diverse threat actors such as state-sponsored organizations, opportunistic hackers and hacktivists, as well as through diverse attack vectors, such as social engineering/phishing, security breaches, malfeasance by insiders, human or technological error, computer viruses, malicious or destructive code, misconfigurations, "bugs" or other vulnerabilities in commercial software that is integrated into our or our third-party service providers' IT Systems, products or services, malware (including ransomware) and other attacks, including through fraud or other means of deception. The methods used to obtain unauthorized access, disable or degrade service or attack or sabotage systems are constantly evolving, and threat actors are becoming increasingly sophisticated in using techniques and tools – including artificial intelligence – that circumvent security controls, evade detection and remove forensic evidence. As a result we may be unable to anticipate or to detect, investigate, remediate or recover from attacks or incidents for long periods of time. Further, we may not be able to prevent all data breaches, misuses of data or other cybersecurity incidents.

There can be no assurance that our cybersecurity risk management program and processes will be fully implemented, complied with or effective in protecting our IT Systems. Because we rely on third-party vendors and service providers for functions critical to our business, including information technology infrastructure and services, successful cyberattacks that disrupt or result in unauthorized access to third-party IT Systems can materially impact our operations and financial results. Our remote and hybrid working arrangements (and at many third-party service providers) also increase cybersecurity risks due to the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks.

Our third-party service providers may experience cybersecurity incidents in varying degrees. While to date no incidents have had a material impact on our operations or our financial results, we cannot guarantee that material incidents will not occur in the future. Any cybersecurity incident or other adverse impact to the availability, integrity or confidentiality of our IT Systems could compromise our technology systems, result in legal claims or proceedings, regulatory investigations and enforcement actions, liability or regulatory penalties, disruption to our operations, damage to our reputation, and/or significant system restoration or remediation and future compliance costs. Any or all of the foregoing could adversely affect our business, results of operations and financial condition.

Laws, regulations and other requirements relating to the privacy, security and handling of information about individuals, and the application and interpretation of those requirements, are constantly evolving. There has been heightened legal and regulatory focus on data privacy and security, including in relation to cybersecurity incidents, and it is possible that new laws or regulations or interpretations may require us to incur significant costs, implement new processes or change our handling of information and business operations. Any failure or perceived failure to comply with laws, regulations and other requirements relating to the privacy, security and handling of information could result in legal claims or proceedings, regulatory investigations or enforcement actions. We could incur significant costs in investigating and defending such claims and, if found liable, pay significant damages or fines or be required to make changes to our business. If any of these events were to occur, our business, results of operations, and financial condition could be materially adversely affected.

***Because the trading market for Harbor's common stock is limited, the common stock may continue to be illiquid.***

Harbor has not listed, and does not currently intend to list, its common stock for trading on any national securities exchange. Although Harbor's common stock is traded under the symbol "HRBR" on the OTC Market, the trading volume for the common stock has historically been limited. Trading on the OTC Market has been further limited due to the fact that Harbor is not currently in compliance with its reporting obligations under Section 15(d) of the Exchange Act because it has not timely filed all required periodic reports with the SEC. As a result of these and other factors, we expect Harbor's common stock to continue to be highly illiquid for the foreseeable future.

Investors should be aware that an active trading market for the common stock may never develop or be sustained, and that the delay in filing certain required periodic reports with the SEC could have a prolonged negative impact on the trading volume of the common stock. The absence of an active trading market for the common stock could result in additional volatility with respect to, and a further decline in, the trading price of the common stock. Investors should also be aware that they may lose all or part of their investment.

***The trading price of Harbor's common stock has been and may continue to be volatile.***

The trading price of Harbor's common stock has been, and may continue to be, volatile. We believe Harbor's stock price will be subject to wide fluctuations in response to a variety of factors, including the following:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• failing to meet the conditions of the Transient Investment Company Exemption or being required to register as an investment company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• actual or anticipated fluctuations in our financial condition, results of operations and liquidity position from period to period;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• actual or potential changes in economic conditions, recessionary concerns, interest rates, inflation and tariffs;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• completion of significant investments, acquisitions or other strategic transactions by us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• threatened or actual litigation, regulatory inquiries or government investigations, including as a result of the restatement of our previously issued consolidated financial statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• purchases or sales of shares of Harbor's common stock pursuant to Harbor's publicly announced stock repurchase program, pursuant to one or more tender offers or otherwise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• issuances of one or more cash dividends to Harbor's stockholders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the illiquidity of Harbor's common stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• speculative trading practices of Harbor's stockholders and other market participants;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• perceptions about securities that are traded on the OTC Market;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Harbor's ability to regain compliance with its reporting obligations under SEC rules and the related timing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the impact of the application of accounting guidance; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• actual or potential changes in geopolitical conditions, including wars, outbreak of hostilities, terrorism, or government sanctions.

In recent years, the stock market has experienced significant price and volume fluctuations. This volatility has had a significant impact on the market price of securities issued by companies across industries. These changes may occur without regard to the financial condition or operating performance of the affected companies. Accordingly, the price of Harbor's common stock could fluctuate based upon factors that have little or nothing to do with Harbor, and these fluctuations could materially reduce the trading price and trading volume of Harbor's common stock.

***The concentration of ownership of Harbor's common stock among a small number of stockholders could allow such stockholders to exert significant influence over our business plans and strategic objectives, control all matters submitted to Harbor's stockholders for approval, or deter a liquidation or change in control transaction, any of which could negatively affect the trading price or trading volume of its common stock.***

As of March 11, 2026 Harbor had 58,429,836 shares of common stock outstanding. As of the same date, Amun LLC ("Amun") held 20,000,000 shares of Harbor's common stock, representing approximately 34.2% of outstanding shares of Harbor's common stock, and Southshore Aircraft Holdings, LLC, through its affiliates (together, "Southshore"), held 16,500,000 shares of common stock, representing approximately 28.2% of the outstanding shares of Harbor's common stock. As a result, Amun and Southshore collectively control a majority of the voting power of Harbor's outstanding common stock and, therefore, are able to exercise significant influence over the establishment and implementation of our business plans and strategic objectives, as well as to control all matters submitted to Harbor's stockholders for approval. These stockholders may manage our business in ways with which certain investors may disagree and may be adverse to their interests. This concentration of ownership may also have the effect of delaying, deterring or preventing a liquidation or change in control transaction, depriving Harbor's stockholders of an opportunity to receive a premium for their investment, or otherwise negatively affecting the trading price or trading volume of Harbor's common stock.

Mr. Bartlett, one of Harbor's directors, may be deemed to be the beneficial owner of the shares of Harbor's common stock held by Amun due to his status as a member of the board of managers of Amun and his ownership of equity interests in Amun. In addition, Mr. Bartlett may be deemed to be the beneficial owner of the shares of Harbor's common stock held by Southshore due to his status as a member of the board of managers of Southshore and his ownership of equity interests in Southshore. Accordingly, Mr. Bartlett may be able to exercise influence over decisions involving the voting or disposition of shares of Harbor's common stock. However, Mr. Bartlett does not control voting or investment decisions made by either Amun or Southshore.

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***Harbor may suspend its obligation to comply with SEC filing requirements in future periods and thereby cease filing***

***reports and other information with the SEC, which could have the effect of reducing the trading volume and trading price of Harbor's common stock.***

In February 2012, Harbor's predecessor, Harbor Biosciences, Inc., filed a Form 15 with the SEC to deregister its common stock pursuant to Section 12(g) of the Exchange Act. The filing of the Form 15 had the effect of suspending Harbor's obligation, pursuant to Section 15(d) of the Exchange Act, to file reports and other information with the SEC. As a result, prior to the filing of our Annual Report on Form 10-K for the year ended December 31, 2019, the last periodic report filed by Harbor was the Annual Report on Form 10-K for the year ended December 31, 2011. As of January 1, 2020, Harbor no longer met the eligibility criteria under Rule 12h-3 of the Exchange Act to suspend its reporting obligations under Section 15(d) of the Exchange Act, requiring Harbor to resume filing reports and other information with the SEC pursuant to the Exchange Act.

We have incurred, and expects to continue to incur, significant direct and indirect costs, and diversion of management's time and resources, as a result of the requirement to comply with certain reporting obligations under the Exchange Act, including those incurred in connection with the preparation and filing of Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, the audit of the consolidated financial statements contained in its Annual Reports in accordance with SEC rules and Public Company Accounting Oversight Board (United States) standards, and compliance with certain provisions of the Sarbanes-Oxley Act of 2002 ("SOX").

Harbor would again become eligible to suspend its public reporting obligations if it: (i) determines in accordance with applicable SEC rules it has fewer than 300 stockholders of record as of certain points in time, (ii) does not file registration statements pursuant to the Securities Act (which it does not currently intend to do), and (iii) meets certain other requirements under applicable SEC rules. If Harbor becomes eligible to suspend its public reporting obligations in future periods, it may elect to take the actions necessary to suspend those obligations, which would result in Harbor no longer being required to file SEC reports. If Harbor ceases filing reports and other information with the SEC, it would significantly reduce the amount of publicly available information about us and our business and operations, which could have the effect of reducing the trading volume and price of Harbor's common stock.

Further, notwithstanding that Harbor is currently required to file certain reports and information with the SEC pursuant to Section 15(d) of the Exchange Act, Harbor does not have a class of securities registered pursuant to Section 12(b) or Section 12(g) of the Exchange Act. As a result, Harbor is not required to comply with, and does not intend to follow, certain disclosure requirements typically applicable to public reporting companies, including the requirement to file proxy statements, information statements, tender offer disclosures, and beneficial ownership filings. Accordingly, we expect there will continue to be significantly less information available about us, including our governance policies and ownership structure, than is available for many other public reporting companies, which could have the effect of further limiting the trading volume, and further reducing the trading price, of Harbor's common stock.

***We are not current with our reporting obligations under the Exchange Act, which could have adverse consequences for Harbor and its stockholders.***

Harbor is not currently in compliance with its reporting obligations under Section 15(d) of the Exchange Act because it has not timely filed all required periodic reports with the SEC. While Harbor currently intends to file all required periodic reports with the SEC and regain compliance with its reporting obligations, there can be no assurance as to the timing of making these required filings. Harbor's failure to timely file all required periodic reports with the SEC, or to regain compliance with its reporting obligations, could have a number of adverse consequences, any of which could harm our business and financial results, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our common stock may not be eligible for "regular way" trading on the OTC Markets or other trading venues, which would significantly limit the liquidity and trading activity in our stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We may be unable to use short-form registration statements for securities offerings, which could increase the cost of, and delay, future capital-raising activities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Potential acquisition targets, business partners, or counterparties may be reluctant to enter into transactions with us due to concerns about our compliance with securities laws;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We could be subject to SEC enforcement actions or civil litigation for failure to comply with our reporting obligations;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We may experience reputational harm that negatively impacts investor confidence in us; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We may be subject to delisting from any securities exchange or marketplace on which our common stock may be listed or quoted.

In addition, as discussed above, Harbor's failure to timely file all required reports with the SEC has resulted in a significant reduction in the trading volume of Harbor's common stock, which may have contributed to a decline in the trading price of the common stock.

***Provisions in Harbor's governing documents might delay or prevent a change of control of Harbor, which could adversely affect the value of Harbor's common stock.***

Harbor's certificate of incorporation and bylaws contain provisions that, among other things:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• prohibit the transfer of any shares of Harbor's capital stock that would result in: (i) any person or entity becoming a "Five-Percent Stockholder" (as defined under Treasury Regulation Section 1.382-T(g)) of Harbor's then-outstanding capital stock, or (ii) an increase in the percentage ownership of any person or entity who is already a "Five-Percent Stockholder" of Harbor's then-outstanding capital stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• authorize the board of directors, without stockholder approval, to authorize and issue preferred stock with powers, preferences and rights that may be senior to Harbor's common stock, that could dilute the interest of, or impair the voting power of, holders of Harbor's common stock and could also have the effect of discouraging, delaying or preventing a change of control;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• establish advance notice procedures that stockholders must comply with in order to nominate candidates to the board of directors and propose matters to be brought before an annual or special meeting of Harbor's stockholders, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer's own slate of directors or otherwise attempting to obtain control of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• give the board of directors exclusive authority to set the number of directors and increase or decrease the number of directors by one or more resolutions, which may prevent stockholders from being able to fill vacancies on the board of directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• restrict the ability of stockholders to call special meetings of stockholders.

These provisions may have the effect of delaying or preventing a change in control of the Company, creating a perception that a change in control cannot occur, or otherwise discouraging takeover attempts that some stockholders may consider beneficial, any of which could also adversely affect the trading price of Harbor's common stock.

***Harbor's certificate of incorporation and bylaws limit certain transfers of Harbor's stock in order to preserve Harbor's ability to use net operating loss carryforwards, which could adversely affect the trading price of its common stock.***

To reduce the risk of a potential adverse effect on Harbor's ability to use net operating loss carryforwards for federal income tax purposes, Harbor's certificate of incorporation and bylaws prohibit certain transfers of shares of Harbor's capital stock that could result in adverse tax consequences by impairing Harbor's ability to utilize net operating loss carryforwards. These transfer restrictions are subject to a number of rules and exceptions, and generally may only be repealed or amended by the affirmative vote of the holders of at least two-thirds of the outstanding shares of Harbor's capital stock. These transfer restrictions apply to the beneficial owners of the shares of Harbor's capital stock. The transfer restrictions contained in Harbor's certificate of incorporation and bylaws may limit demand for Harbor's common stock, which may adversely affect the trading price. In addition, this limitation may have the effect of delaying or preventing a change in control of the Company, creating a perception that a change in control cannot occur, or otherwise discouraging takeover attempts that some stockholders may consider beneficial.

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***Harbor currently does not intend to pay dividends on its common stock and, consequently, the only opportunity to achieve a return on an investment in Harbor's common stock may be the appreciation in value of Harbor's common stock.***

Harbor has not historically paid dividends on shares of its common stock and does not expect to pay dividends in the foreseeable future. Any future determination by Harbor to pay dividends will be at the discretion of Harbor's board of directors and will depend on our business strategy, financial condition, liquidity position, capital requirements, restrictions in commercial agreements, business prospects and such other factors as Harbor's board of directors deems relevant. Harbor is currently in the process of evaluating potential strategic alternatives, which could include the issuance of one or more cash dividends. However, no decision has been made regarding the pursuit of any particular strategic alternative, and we cannot predict when a decision will be made. Consequently, investors should consider that their only opportunity to achieve a positive return on their investment in Harbor's common stock may be the appreciation in value of the common stock. However, as a result of numerous risks and uncertainties described in this Annual Report, the trading price may not appreciate and may decline significantly.

***As a "smaller reporting company," Harbor has availed itself of reduced disclosure requirements, which may make Harbor's common stock less attractive to investors.***

Harbor is a "smaller reporting company" under applicable SEC rules, and it will continue to be a "smaller reporting company" for so long as either: (i) the market value of Harbor's common stock held by non-affiliates as of the end of its most recently completed second quarter is less than $250 million; or (ii) the market value of Harbor's common stock held by non-affiliates is less than $700 million and the annual revenues of Harbor are less than $100 million during the most recently completed fiscal year. Because Amun and Southshore, both of which are affiliates of Harbor, collectively hold a significant percentage of the outstanding shares of Harbor's common stock, it would require a significant increase in the market value of the common stock for Harbor to no longer qualify as a "smaller reporting company."

As a "smaller reporting company," Harbor has relied on exemptions from certain disclosure requirements that are applicable to other public reporting companies. These exemptions include reduced financial disclosure and disclosure regarding executive compensation. Investors may find Harbor's common stock less attractive because it relies on these exemptions, which could lead to a less active trading market for Harbor's common stock and negatively impact the trading price. In addition, as previously discussed, Harbor does not have a class of securities registered pursuant to Section 12(b) or 12(g) of the Exchange Act, which further reduces its disclosure obligations.

***Complying with public reporting requirements under the Exchange Act is expensive and diverts management's attention from evaluating and executing our business strategies.***

We are subject to the reporting requirements of Section 15(d) of the Exchange Act, which requires that we file annual, quarterly, and current reports with the SEC. In addition, pursuant to SOX, we are required to regularly assess the effectiveness of our disclosure controls and procedures and our internal control over financial reporting.

Compliance with these various reporting and compliance obligations is expensive and places significant demands on our management team. Additional resources and management oversight may be required to maintain and enhance our disclosure controls and procedures and internal control over financial reporting, which could have an adverse impact on our business and results of operations. However, after giving effect to the Aviation Disposition, we have a limited number of employees with expertise in financial and accounting matters, developing and maintaining a system of internal controls, and remediating material weaknesses or significant deficiencies in internal control over financial reporting, which increases the risk that our internal control over financial reporting may not be effective in future periods. In addition, the risks associated with being a public reporting company could make it more difficult for us to attract and retain qualified members of the board of directors and executive officers, increase the cost of their services, and increase the cost of premiums for director and officer liability insurance.

***The restatement of our previously issued consolidated financial statements may continue to subject us to risks and uncertainties, including the increased possibility of litigation, regulatory inquiries, and loss of investor confidence.***

We restated our audited consolidated financial statements as of and for the year ended December 31, 2022 and our interim unaudited consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023. Our management dedicated significant time and resources to complete the restatement, and we incurred substantial costs for accounting and legal fees. The prior restatement may continue to subject us to risks and uncertainties, as well as additional costs. For example, several lawsuits were filed relating to facts arising in connection

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with the restatement, and we could become subject to additional litigation or regulatory inquiries in the future. In addition, the prior restatement may affect investor confidence in the accuracy and completeness of our financial statements, prevent us from completing acquisitions or entering into other strategic alternatives, restrict our access to the capital markets, or raise reputational risks for our business, any of which could harm our business and financial results.

***We previously identified a material weakness in our internal control over financial reporting and there is a risk that our internal control over financial reporting may not be effective going forward.***

As discussed in the 2023 Annual Report, our management concluded that we did not maintain effective internal control over financial reporting as of December 31, 2023, due to a material weakness. Remediation of the material weakness will require further validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles, and we concluded that the identified material weakness had not been fully remediated as of December 31, 2024. We cannot provide assurance that the remediation efforts we are implementing will be sufficient to remediate the identified material weakness or to avoid potential future material weaknesses or significant deficiencies. Because of its inherent limitations, our system of internal control over financial reporting may not prevent or detect every material misstatement in our financial statements. For additional information, please refer to Part I, Item 4, *Controls and Procedures*, in this Annual Report.

Our conclusion that we did not maintain effective internal control over financial reporting as of December 31, 2023, as well as a determination in any future period that our internal control over financial reporting is not effective, could cause investors to lose confidence in the accuracy and completeness of our financial reports, result in sanctions by the SEC or other regulatory authorities, and cause the trading price or volume of Harbor's common stock to decline. Any failure to achieve or maintain effective internal control over financial reporting could inhibit our ability to accurately report our financial condition or operating results, which could prevent us from completing acquisitions or entering into other strategic alternatives, restrict our access to the capital markets, and increase the risk of regulatory actions or litigation. We also face risks associated with the cost of establishing and maintaining effective internal control over financial reporting. Ensuring we have adequate internal financial and accounting controls and procedures in place to produce accurate financial statements on a timely basis is a costly and time-consuming effort.

After giving effect to the Aviation Disposition, we have a small number of employees, executive officers and advisors who manage our day-to-day affairs, oversee our remaining assets and obligations, evaluate strategic alternatives and execute any transaction we may pursue. As a result, we have a limited number of employees with expertise in financial and accounting matters, and with developing and maintaining a system of internal controls and remediating material weaknesses or significant deficiencies in internal control over financial reporting. This dynamic creates additional risk that our internal control over financial reporting may not be effective in future periods.

***Stock repurchases could increase the volatility or decrease the trading price of Harbor's common stock, and we cannot guarantee that our stock repurchase program will enhance long-term stockholder value.***

Harbor's board of directors has adopted a stock repurchase program pursuant to which Harbor may repurchase shares of its common stock from time to time. From the inception of the program through March 31, 2025, Harbor has purchased approximately 12.9 million shares of its common stock pursuant to the program. No shares have been purchased after that date. Although the board of directors has authorized the repurchase program, and Harbor has completed the purchase of shares of common stock, it does not obligate us to repurchase any additional dollar amount or number of shares, and the program may be modified, suspended or terminated at any time and for any reason. The additional number of shares to be repurchased, and the timing of any such repurchases, depends on a number of factors, including the trading price and volume of the common stock, our business strategy, financial performance, liquidity position and capital requirements, restrictions in commercial agreements, general market conditions, applicable legal requirements and other factors.

Repurchases of Harbor's common stock could increase the volatility of the trading price and reduce the trading volume of the common stock, either of which could have a negative impact on the trading price. Similarly, the future announcement of the termination or suspension of the repurchase program, or our decision not to utilize the full authorized repurchase amount under the repurchase program, could result in a decrease in the trading price. Further, the trading volume of Harbor's common stock has been limited due to the fact that Harbor is not currently in compliance with its reporting obligations under Section 15(d) of the Exchange Act, which has severely limited our ability to utilize the repurchase program and may result in further downward pressure on the trading price.

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There can be no assurance that any repurchases we do elect to make will enhance stockholder value because the market price of Harbor's common stock may decline below the levels at which we repurchased shares. We cannot guarantee that the repurchase program will enhance long-term stockholder value.

***Harbor continues to be at risk of future securities class actions or other litigation.***

Securities class action litigation may be instituted against public reporting companies following a decline in the price of a company's securities, or as a result of declines in the value of securities within the market generally. As a result of our requirement to comply with Exchange Act reporting obligations, a significant amount of information is publicly available regarding our historical business and operations, financial condition and results of operations, and consideration of strategic alternatives. The availability of this information increases the risk of threatened or actual litigation, or other disputes, with our stockholders, current or former employees, or other constituents. For example, several class action lawsuits were filed against us relating to facts arising in connection with the restatement of our previously issued consolidated financial statements, and similar claims could be filed in the future. While the existing lawsuits were generally resolved in our favor, they resulted in the payment of significant legal fees. Future lawsuits could be filed against us relating to the Aviation Disposition or our decision to pursue certain strategic alternatives. If future lawsuits are filed against us, it may result in us being required to pay damages or settlement fees, incur significant defense costs, and experiencing a diversion of management's attention, any of which could harm our business, financial condition and results of operations.

***If securities or industry analysts do not publish reports about our business, or we do not issue press releases, an active trading market for Harbor's common stock may not develop.***

The extent of any trading market for Harbor's common stock will depend, in part, on the content of any reports that securities or industry analysts publish about our business, as well as any press releases or other publications issued by us. Analyst coverage of the Company has been extremely limited, and we are not aware of any reputable analysts that cover us. In addition, we do not intend to regularly issue press releases in the future. Investors should not purchase Harbor's common stock with the expectation that we will have analyst coverage or that we will publish press releases, and should be aware that the information available about our business may be significantly less than information about other public companies. In the absence of these reports or other publications, an active trading market for Harbor's common stock may not develop or be sustained.

Moreover, as discussed above, Harbor is not current in filing certain reports with the SEC as required pursuant to Section 15(d) of the Exchange Act. Harbor's failure to be timely in its SEC reporting obligations has had, and may continue to have, a material adverse impact on the trading volume and trading price of its common stock.

**ITEM 1B.&nbsp;&nbsp;&nbsp;&nbsp; UNRESOLVED STAFF COMMENTS** 

None.

**ITEM 1C.&nbsp;&nbsp;&nbsp;&nbsp; CYBERSECURITY** 

**Cybersecurity Risk Management and Strategy**

During the period covered by this Annual Report, Air Wisconsin's approach to mitigating information technology ("IT") and cybersecurity risk was comprised of a range of activities with the primary objective of maintaining the confidentiality, integrity and availability of its critical IT Systems and information related to its business. Although IT Systems are inherently vulnerable to interruption due to a variety of sources, Air Wisconsin aligned its cybersecurity risk management program, including our processes and controls, with certain applicable and relevant guidelines, including the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF). Air Wisconsin assessed its cybersecurity maturity against the NIST CSF's core functions; however, this did not imply that it met any particular technical standards, specifications or requirements, only that it used the NIST CSF as a guide to help it identify, assess and manage cybersecurity risks relevant to its business.

Air Wisconsin's cybersecurity risk management processes included a cybersecurity incident response plan, and it invested in technical and organizational safeguards intended to manage and mitigate material risks from cybersecurity threats to its IT Systems, including network security controls, employee training, internal vetting of third-party vendors and service providers with whom Air Wisconsin may have shared data, and regular system reviews and security exercises. Air Wisconsin's cybersecurity risk management program was a component of its overall enterprise risk management program,

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and shared common methodologies, reporting channels and governance processes that applied across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas.

During the period covered by this Annual Report, Air Wisconsin worked closely with accredited third-party cybersecurity firms to audit its security architecture. Air Wisconsin's Information Security Team, consisting of experienced cybersecurity professionals, was responsible for the day-to-day management of our cybersecurity risks, including directing its cybersecurity risk assessment processes, its security processes, and its response to cybersecurity incidents. For the year ended December 31, 2024, Air Wisconsin did not identify risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that had or were reasonably likely to materially affect it, including its operations or business strategy or our results of operations or financial condition. Air Wisconsin faced certain ongoing risks from cybersecurity threats that, if realized, could have materially adversely affect it, including its operations or business strategy or our results of operations or financial condition.

**Cybersecurity Governance**

We consider cybersecurity risk as critical to the enterprise and, prior to January 9, 2026, delegated the cybersecurity risk oversight function to Air Wisconsin. Certain individuals within Air Wisconsin, including its Vice President of Information Technology ("IT Management") oversee the design, implementation and enforcement of our cybersecurity risk management program, including a cybersecurity policies and procedures manual. IT Management was supported by Air Wisconsin internal security staff and external experts as part of its continuing education on topics that impact public companies. Air Wisconsin's Vice President of Information Technology has more than 15 years of experience managing and leading IT and cybersecurity teams. IT Management was responsible for efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in the IT environment. In the event of a breach or incident, the cybersecurity policies and procedures manual requires notification to Harbor's board of directors. Following the Aviation Disposition, we engaged a third-party to manage its IT services, including the critical function of end-point protection and overall cybersecurity strategy.

**ITEM 2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PROPERTIES**

**Aircraft Fleet** 

As of December 31, 2024, Air Wisconsin owned 63 CRJ-200 regional jets, each of which was configured for single class seating. As a result of the Aviation Disposition, we no longer own any regional jets.

**Facilities** 

In addition to aircraft, as of December 31, 2024, Air Wisconsin had offices, crew bases and maintenance facilities to support its operations. All of Air Wisconsin's material facilities (other than those provided by American under the American capacity purchase agreement) held as of December 31, 2024 are summarized in the following table:

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| | | | |
|:---|:---|:---|:---|
| **Type** | **Location** | **Ownership** | **Approximate<br>Square Footage** |
| Corporate Headquarters | Appleton, WI | Leased | 20140 |
| Maintenance Hangar | Appleton, WI | Leased | 37200 |
| Disaster Recovery Center | Appleton, WI | Leased | 2560 |
| Maintenance Hangar | Dayton, OH | Leased | 21500 |
| Maintenance Hangar | Milwaukee, WI | Leased | 60000 |
| Crew Base | Dayton, OH | Leased | 1685 |

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In July 2003, Air Wisconsin financed the Milwaukee maintenance hangar through the issuance of approximately $4.3 million principal amount of City of Milwaukee, Wisconsin variable rate industrial development bonds. The bonds mature November 1, 2033. Prior to May 1, 2006, the bonds were secured by a guaranteed investment contract, which was collateralized with cash and interest and payable semiannually. In May 2006, Air Wisconsin acquired the bonds using the

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cash collateral. The bonds are reported as long-term investments in the consolidated balance sheets. The hangar is accounted for as a right-of-use asset.

As a result of the Aviation Disposition, we no longer maintain any offices, crew bases or maintenance facilities, with the exception of a single lease for office space located in Appleton, WI covering approximately 1,000 square feet.

**ITEM 3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LEGAL PROCEEDINGS** 

From time to time, we are involved in various investigative inquiries, legal proceedings and other disputes arising from or related to matters incident to the ordinary course of our business activities, including actions with respect to intellectual property, employment, regulatory and contractual matters. Although the results of such investigative inquiries, legal proceedings and other disputes cannot be predicted with certainty, we believe that we are not currently a party to any matters which would be reasonably likely, individually or taken together, to have a material adverse effect on our business, operating results, financial condition or cash flows. However, regardless of the merit of any matters raised or the ultimate outcome, investigative inquiries, legal proceedings and other disputes may generally have an adverse impact on us as a result of defense and settlement costs, diversion of management resources, and other factors.

Prior to its termination, a dispute arose under the United capacity purchase agreement which was resolved by arbitration and the issuance of the United Arbitration Award in February 2024. The arbitrators denied Air Wisconsin's claims that United owed it amounts under the United capacity purchase agreement and denied United's claims that Air Wisconsin breached the agreement by terminating it and that Air Wisconsin owed it damages. As a result, neither party owed to the other party any amounts claimed in the arbitration. For additional information, please refer to the sections titled "*Certain Trends and Uncertainties Affecting Our Business and Industry*" in Part I, Item 1, *Business*, and "*Business Overview and Recent Developments*" in Part I, Item 7, *Management's Discussion and Analysis of Financial Condition and Results of Operations,* in this Annual Report.

As previously disclosed, the Company and certain of our officers and directors were named as defendants in several lawsuits relating to facts arising in connection with the restatement of our consolidated financial statements for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023. One of those matters was a consolidated putative class action complaint captioned *Toft v. Harbor Diversified, Inc., et al.*, No. 24-C-556 (E.D. Wisc. 2024) (the "Class Action"). On January 31, 2025, the court dismissed the operative complaint for failure to state a claim upon which relief could be granted. Defendants subsequently moved for sanctions under Rule 11 of the Federal Rules of Civil Procedure against the plaintiffs and their law firms, including the Rosen Law Firm. On December 3, 2025, the court granted the motion for sanctions with respect to the Rosen Law Firm, finding that its complaint against the Company was frivolous, and entered judgment in favor of the defendants. The court will now determine the amount of attorneys' fees and costs to which the Company and certain of its officers are entitled based on the Rule 11 violations found by the court.

In 2024, three stockholders each filed a stockholder derivative action against certain officers and directors of the Company alleging breach of fiduciary duty, among other claims, arising from allegations substantively similar to those raised in the Class Action. Two of those actions were consolidated in an action captioned *In re Harbor Diversified, Inc. Shareholder Derivative Litigation*, No. 24-C-903 (E.D. Wisc. 2024), and the other action is captioned *Cooke v. Bartlett et. al*., No. 24-934-MN (D. Del. 2024). Neither action substantively moved forward while the parties awaited a decision on the motion to dismiss in the Class Action. Following the dismissal of the Class Action, on March 12, 2026, the court entered a dismissal without prejudice in the Wisconsin consolidated action pursuant to the stipulation of the parties. The plaintiff in the Delaware action filed a notice of dismissal on March 25, 2026.

**ITEM 4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MINE SAFETY DISCLOSURES** 

Not applicable.

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**PART II** 

**ITEM 5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES** 

**Market Information** 

Harbor's common stock is currently traded on the OTC Market under the symbol "HRBR." Harbor has not listed, and does not currently intend to list, its common stock for trading on any national securities exchange. The trading volume for the common stock has historically been limited. Trading on the OTC Market has been further limited due to the fact that Harbor is not currently in compliance with its reporting obligations under Section 15(d) of the Exchange Act because it has not timely filed all required periodic reports with the SEC Accordingly, we expect Harbor's common stock to continue to be highly illiquid for the foreseeable future. Investors should be aware that an active trading market for Harbor's common stock may never develop or be sustained, and that the delay in filing certain required periodic reports with the SEC could have a prolonged negative impact on the trading volume of the common stock. For additional information, please refer to the "Cautionary Note Regarding Forward-Looking Statements," and Part I, Item 1A, Risk Factors, in this Annual Report.

**Holders of Record** 

As of March 11, 2026, there were approximately 351 holders of record of Harbor's common stock. Because many of the shares are held by brokers and other institutions on behalf of stockholders, not all of which are known to Harbor, Harbor is unable to provide the exact number of stockholders represented by these record holders.

The transfer agent and registrar for Harbor's common stock is Equinity Trust Company, LLC.

**Dividends** 

Harbor has not historically paid any cash dividends on shares of its common stock and does not expect to pay dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of Harbor's board of directors and will depend on our business strategy, financial condition, liquidity, capital requirements, restrictions contained in commercial agreements, business prospects and such other factors as Harbor's board of directors deems relevant. Harbor is currently in the process of evaluating potential strategic alternatives, which could include the issuance of one or more cash dividends. However, no decision has been made regarding the pursuit of any particular strategic alternative, and we cannot predict when a decision will be made.

**Unregistered Sales of Equity Securities** 

There were no unregistered sales of Harbor's equity securities during the year ended December 31, 2024.

**Purchases of Equity Securities by the Issuer and Affiliated Purchasers** 

On March 30, 2021, Harbor's board of directors adopted a stock repurchase program pursuant to which Harbor could repurchase up to $1.0 million of shares of its common stock from time to time during the first calendar month of the program, subject to an automatic increase of $1.0 million per calendar month thereafter. The number of shares to be repurchased, and the timing of any such repurchases, will depend on a number of factors, including the trading price and volume of the common stock, our business strategy, financial performance, liquidity position and capital requirements, restrictions in commercial agreements, general market conditions, applicable legal requirements and other factors. Repurchases may be effected through open market transactions, privately negotiated transactions, or any other lawful means. Harbor may, but is not required to, effect repurchases under a trading plan adopted pursuant to Rule 10b5-1 under the Exchange Act, or subject to Rule 10b-18 under the Exchange Act. Harbor is not obligated under the program to acquire any particular dollar amount or number of shares, and the program may be modified, suspended or terminated at any time and for any reason.

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Below is a summary of stock repurchase activity under Harbor's stock repurchase program during the three months ended December 31, 2024:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Total number<br>of shares <br>purchased<br>(1)** | **Average <br>price <br>paid per<br>share** | **Dollar value of<br>shares <br>repurchased** | **Approximate<br>dollar value of<br>shares<br>remaining<br>available<br>under stock<br>repurchase<br>program** |
| October 1 – October 31, 2024 | 8510 | $0.90 | $7622 | $16056446 |
| November 1 – November 30, 2024 | 12941 | $1.02 | $13225 | $17043221 |
| December 1 – December 31, 2024 | 19097 | $1.01 | $19382 | $18023839 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | 40548 | $0.99 | $40229 |  |

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(1)All of the reported shares were repurchased pursuant to Harbor's publicly announced stock repurchase program. In addition, all of the reported shares were purchased pursuant to a trading plan adopted pursuant to Rule 10b5-1 under the Exchange Act and in compliance with Rule 10b-18 under the Exchange Act.

Harbor acquired an aggregate of 1,132,594 shares of its common stock pursuant to the stock repurchase program during the year ended December 31, 2024. From the inception of the program through March 31, 2025, Harbor has purchased approximately 12.9 million shares of its common stock pursuant to the program. No shares have been purchased after that date.

No "affiliated purchaser" (as defined in Rule 10b-18(a)(3) under the Exchange Act) of Harbor acquired any shares of Harbor's equity securities during the year ended December 31, 2024.

**ITEM 6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [RESERVED]** 

**ITEM 7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

*The following discussion and analysis of our financial condition and results of operations should be read together with our audited consolidated financial statements, accompanying notes, and other financial information included in this Annual Report on Form 10-K for the year ended December 31, 2024 (this "Annual Report"). The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those expressed or implied by the forward-looking statements below. Factors that could cause or contribute to those differences in our actual results include, but are not limited to, those discussed below and elsewhere in this Annual Report, particularly in "Cautionary Note Regarding Forward-Looking Statements" and Part I, Item 1A."Risk Factors," in this Annual Report.* 

**General**

Harbor Diversified, Inc. ("Harbor") is a non-operating holding company that is the parent of a consolidated group of subsidiaries, including AWAC Aviation, Inc. ("AWAC"), which, until January 9, 2026, was the sole member of Air Wisconsin Airlines LLC ("Air Wisconsin"), which had historically operated as an independent air carrier. Harbor is also the direct parent of three other subsidiaries: (1) Lotus Aviation Leasing, LLC ("Lotus"), which leased flight equipment to Air Wisconsin, (2) Air Wisconsin Funding LLC ("AWF"), which provided flight equipment financing to Air Wisconsin, and (3) Harbor Therapeutics, Inc. ("Therapeutics"), which is a non-operating entity with no material assets.

Following the Aviation Disposition (as defined below), neither Harbor nor any of its remaining subsidiaries has any material operating assets or active airline operations. Our remaining assets consist primarily of cash and cash equivalents, restricted cash and marketable securities.

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Because Harbor consolidated Air Wisconsin for financial statement purposes prior to the Aviation Disposition, for purposes of this Annual Report, disclosures relating to activities of Air Wisconsin also apply to Harbor, unless otherwise noted. Where reference is made only to Harbor Diversified, Inc. (such as when referring to the outstanding shares of common stock), it is referred to as "Harbor." Where reference is made only to Air Wisconsin (such as where it is named specifically for its historical contractual obligations and operations), it is referred to as "Air Wisconsin." Where reference is intended to include Harbor and its consolidated subsidiaries, they are jointly referred to as the "Company," "we," "us," or "our."

Unless otherwise indicated, the discussion below reflects our historical financial condition and results of operations for the year ended December 31, 2024, during which Air Wisconsin conducted airline operations. Our business operations and financial condition following the Aviation Disposition are materially different from our historical operations and financial condition reflected in the periods presented, and historical results should not be viewed as indicative of future performance.

**Restatement of Previously Issued Condensed Consolidated Financial Statements**

We restated our audited consolidated financial statements as of and for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023.

Please refer to the "*Explanatory Note*" in the 2023 Annual Report, and Note 2, *Restatement of 2022 Consolidated Financial Statements*, and Note 20, *Restatement of Prior Quarterly 2023 and 2022 Condensed Consolidated Financial Statements (Unaudited)*, to the audited consolidated financial statements included in the 2023 Annual Report, for additional information on the restatement of, and the related effects on, our consolidated financial statements.

The prior restatement required significant management attention and resulted in substantial accounting and legal costs. Although we have completed the restatement process, this historical financial information discussed below reflects the effects of those restatements, and investors should consider the impact of the restatement when evaluating the period-to-period comparisons.

**Business Overview and Recent Developments**

***Aviation Disposition***

As previously disclosed, on January 9, 2026, Harbor completed the last in a series of transactions pursuant to which it disposed of all of its aviation assets, including its membership interests in Air Wisconsin (the completion of all such transactions, collectively, the "Aviation Disposition"). The aggregate consideration received in connection with the Aviation Disposition was approximately $125.9 million, subject to certain customary purchase price adjustments and the impact of required tax obligations.

After giving effect to the Aviation Disposition, neither Harbor nor any of its remaining subsidiaries has any material operating assets or infrastructure to support an airline, provided that the Company did retain certain non-operating assets, which primarily relate to lease payments for a single aircraft, insurance claims, and state and federal tax refunds.

The Company currently does not have any material operating assets, is not engaged in any operating business, and does not have any source of revenue from operations.

***Historical Regional Airline Services and Supplemental Operations***

Prior to the Aviation Disposition, our primary business strategy consisted of providing regional airline services under capacity purchase agreements with major airlines and certain other supplemental operations including charter flights. As of December 31, 2024, Air Wisconsin owned a fleet of 63 CRJ-200 regional jets. all of which were manufactured by Bombardier, Inc. Following the Aviation Disposition, the Company has no material operating assets.

***American Capacity Purchase Agreement***

In August 2022, Air Wisconsin entered into a capacity purchase agreement (the "American capacity purchase agreement") with American Airlines, Inc. ("American"), pursuant to which Air Wisconsin agreed to provide regional airline services for American. Air Wisconsin commenced flying operations for American in March 2023. American became Air Wisconsin's sole airline partner in early June 2023 when all of Air Wisconsin's aircraft were removed from the

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capacity purchase agreement that Air Wisconsin had entered into with United Airlines, Inc. ("United") in February 2017 (the "United capacity purchase agreement"). As of December 31, 2024, Air Wisconsin had 45 aircraft in service for American. For the year ended December 31, 2024, substantially all of our operating revenues were derived from operations associated with the American capacity purchase agreement. For the year ended December 31, 2023, approximately 63.8% of our operating revenues were derived from operations associated with the American capacity purchase agreement.

Under the American capacity purchase agreement Air Wisconsin was entitled to receive certain payments based on the number of aircraft covered under the agreement, block hours, departures and certain performance metrics. Air Wisconsin was also eligible to receive bonus compensation, and was required to pay rebates, upon the achievement of, or failure to achieve, certain pre-established performance criteria.

Air Wisconsin was responsible for certain customary costs relating to the flight operation and maintenance of the covered aircraft along with other customary controllable expenses, including expenses associated with flight crews, line maintenance and overhead. American reimbursed Air Wisconsin for certain customary costs and expenses incurred in connection with Air Wisconsin's flight operations, including fuel, landing and air traffic control, changes to livery and branding, aircraft and passenger liability insurance, property taxes and systems support. American had the right to schedule all aircraft covered by the agreement, including determining route selection and frequency, and the timing of scheduled arrivals and departures, in each case subject to certain scheduling parameters. American also had the right to determine and publish fares and to establish seat inventories, overbooking levels, and allocation of seats among fare categories. American provided all ground handling services, including gate and ticket counter services, baggage handling, cargo handling, aircraft loading/unloading services, passenger ticketing, and aircraft cabin cleaning. American had the right to all revenues resulting from the sale of passenger tickets associated with the covered aircraft and all other sources of revenue associated with the operation of the covered aircraft, including revenues relating to baggage charges, food and beverage sales and ticket change fees. The American capacity purchase agreement protected Air Wisconsin, to an extent, from many of the elements that typically cause volatility in airline financial performance, including fuel prices, variations in ticket prices, and fluctuations in the number of passengers.

On January 3, 2025, in accordance with the American capacity purchase agreement, American delivered to Air Wisconsin notice of termination of the agreement, effective April 3, 2025. On that date, all remaining Air Wisconsin aircraft covered by that agreement were withdrawn from service under the agreement.

For additional information, please refer to the section titled "*American Capacity Purchase Agreement*" in Part I, Item 1, "*Business,"* and Part I, Item 1A, *Risk Factors*, in this Annual Report, and Note 1, *Summary of Significant Accounting Policies — Contract Revenues*, Note 2, *Capacity Purchase Agreements with United and American*, and Note 15, *Subsequent Events*, in the notes to the audited consolidated financial statements in this Annual Report.

***United Capacity Purchase Agreement***

Prior to early June 2023, Air Wisconsin provided regional airline services to United pursuant to the United capacity purchase agreement, which was entered into in February 2017 and which terminated in early June 2023. Approximately 36.0% of our operating revenues for the year ended December 31, 2023, was derived from operations associated with the United capacity purchase agreement. None of our operating revenues for the year ended December 31, 2024, were derived from operations associated with the United capacity purchase agreement. For additional information, please refer to Note 1, *Summary of Significant Accounting Policies — Contract Revenues*, and Note 3, *Capacity Purchase Agreements with United and American,* in the notes to the audited consolidated financial statements in this Annual Report.

***Prior Dispute with United***

Prior to its termination, a dispute arose under the United capacity purchase agreement which was resolved by arbitration and the issuance of a decision and award in February 2024 (the "United Arbitration Award"). The United Arbitration Award held, among other things, that Air Wisconsin was not entitled to the payments from United that were at issue in the arbitration and denied United's claim that Air Wisconsin breached the agreement by terminating it and its claim that Air Wisconsin owed it damages for the alleged wrongful termination. As a result, neither party owed to the other party any amounts claimed in the arbitration.

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***Federal and State Tax Refunds***

We determined that, as a result of the United Arbitration Award, we would amend our 2021 and 2022 federal and state income tax returns to recover federal and state income taxes previously paid related to the disputed amounts. As a result, we recorded federal and state tax assets of approximately $7.4 million in the aggregate related to the amendment of our 2021 and 2022 federal and state income tax returns. As of December 31, 2024, we had yet to receive $7.4 million related to the 2022 and 2021 amended tax returns. The decrease in revenues and interest income also resulted in federal and state net operating losses as of December 31, 2022 and much of these losses remain as of December 31, 2024. While we established valuation allowances against our deferred tax assets beginning with the year ended December 31, 2022 and continuing through the year ended December 31, 2024, the federal and state net operating losses are available to reduce future taxable income. For additional information, please refer to Note 3, *Income Taxes,* in the notes to the audited consolidated financial statements in this Annual Report.

As of the date of this Annual Report, we continue to pursue collection of the anticipated federal and state income tax refunds described above. However, the timing and receipt of such funds remains subject to review by the applicable taxing authorities.

***Alternative Business Strategies***

On January 3, 2025, American gave notice to Air Wisconsin of the termination of the American capacity purchase agreement, effective April 3, 2025. Given the dynamics in the airline industry, including the decision by multiple major airlines to eliminate from their fleets single class 50-seat aircraft, such as those owned by Air Wisconsin, the Company realized that it was unlikely Air Wisconsin would be able to enter into a new capacity purchase agreement with a major airline to provide regional airline service. As a result, on January 10, 2025, Air Wisconsin announced a strategic realignment of its business strategies. As part of that contemplated realignment, Air Wisconsin began exploring various business opportunities, including (1) expanding its charter operations; (2) focusing on Essential Air Service Program ("EAS") markets; and (3) transitioning its relationship with American to a codeshare and interline relationship. These efforts did not lead to sustainable operations or positive financial results.

In the second and third quarters of 2025, Air Wisconsin began exploring other strategic alternatives, including the sale of its business or of substantially all of its assets, either in one transaction or a series of multiple transactions. Management had discussions with several different parties and considered various proposals from interested parties, some of which were interested in acquiring Air Wisconsin's DOT operating certificate and others of which were interested in acquiring some of Air Wisconsin's aircraft. The primary factors Air Wisconsin considered in analyzing various proposals included anticipated deal consideration, legal structure, expected tax implications, regulatory timing and impacts, and certainty of closing. The strategic review process culminated in the Aviation Disposition.

Following the Aviation Disposition, we are evaluating potential strategic alternatives that may include investments in, or acquisitions of, one or more businesses, assets, technologies, joint ventures, or other strategic opportunities. Any such transactions could involve one or multiple investments or acquisitions, be in any number of industries or lines of business and involve the use of cash, equity securities, or a combination thereof. In addition, the Company may pursue other strategic alternatives, which could include, without limitation, the issuance of one or more cash dividends, share repurchases, tender offers, registration as an investment company, a liquidation of the Company, or other potential transactions. Until a strategic alternative is identified and completed, if at all, we expect our business to remain focused primarily on investment management, capital preservation, liquidity and the evaluation of potential opportunities.

Additionally, since our remaining assets are predominantly comprised of cash and cash equivalents, restricted cash and marketable securities, the Company could potentially be deemed an "investment company" pursuant to the Investment Company Act of 1940, as amended, and the rules promulgated thereunder (the "Investment Company Act"). Becoming an investment company would impose on the Company additional regulatory and disclosure requirements, compliance with which could be expensive and time-consuming. The Investment Company Act provides a number of exemptions, including a one-year safe harbor for companies that are seeking to acquire an operating business. The Company intends to avail itself of this exemption. If the Company is not able to meet the requirements of the exemption, it may be required to register as an investment company, seek the availability of a different exemption, or pursue an alternative strategy.

***Dependence on Investment Income***

Following the Aviation Disposition, our primary assets consist of cash and cash equivalents, restricted cash and marketable securities. Consistent with our investment policies, those assets are primarily invested in deposit accounts,

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money market funds, government-backed securities, and similar investments, with the primary objectives of maintaining liquidity and preserving principal. Since we are no longer engaged in any operating business, and do not have any source of revenue from operations, our primary source of earnings for the foreseeable future is expected to be investment income generated from those assets. Accordingly, our future results of operations and cash flows are expected to be materially influenced by factors such as prevailing interest rates, the credit quality of counterparties, the composition and maturity of our investment portfolio, and broader macroeconomic conditions. Further, our investment returns must be sufficient to offset our ongoing corporate expenses, including costs associated with maintaining our public company status, pursuing strategic alternatives, and compensating our management team. To the extent our operating expenses exceed investment income over an extended period, our assets would decline, reducing the capital available for strategic transactions or other strategic opportunities.

**2024 Financial Highlights**

The following financial highlights relate solely to our historical performance inclusive of our airline operations for the year ended December 31, 2024, and do not reflect our financial position following the Aviation Disposition on January 9, 2026.

For the year ended December 31, 2024, we had total operating revenues of $202.4 million, a 1.6% increase, compared to $199.2 million for the year ended December 31, 2023. Net loss for the year ended December 31, 2024 was $17.2 million, or net loss of $0.36 per basic and diluted share, compared to net loss of $16.0 million, or net loss of $0.39 per basic and diluted share, for the year ended December 31, 2023. For additional information, please refer to Note 11, *Earnings per Share and Equity*, in the notes to the audited consolidated financial statements in this Annual Report.

***Revenue***

Because our flights under our capacity purchase agreements provided distinct services that had the same pattern of transfer to the customer, which were satisfied over time with the measure of progress for each flight deemed to be substantially the same, the flight services provided under the American capacity purchase agreement and the United capacity purchase agreement represented a series of services that have been accounted for as a single performance obligation. Therefore, our contract revenues were recognized when service was provided, and our performance obligation was met on a per completed flight basis. The performance obligation of each completed flight was measured using departures.

The United capacity purchase agreement terminated in early June 2023 and contract revenues have not been recorded under that agreement since then. In March 2023, Air Wisconsin commenced flying operations for American under the American capacity purchase agreement, at which time Air Wisconsin began recording contract revenues under that agreement. Contract revenues could take the form of fixed or variable receipts as further described below. Amounts Air Wisconsin received for completing its performance obligation in a particular period have been recorded as contract revenues in that period and were generally variable in nature, such as revenues based on departures and block hours or the number of aircraft for which it received compensation on a daily basis. Other amounts received have been recognized in contract revenues in proportion to the number of flights actually completed in the period relative to the number of flights that were expected to be completed in subsequent periods during the remaining term of the agreement. The capacity purchase agreements also provided for the reimbursement to Air Wisconsin of certain direct operating expenses, such as certain insurance premiums and property taxes.

The number of aircraft we had in scheduled service and the number of block hours and departures we generated from our flights were the primary drivers of our contract revenues under both the United capacity purchase agreement and the American capacity purchase agreement. Primarily as a result of the pilot shortage, block hours decreased from 87,011 during the year ended December 31, 2023 to 74,742 during the year ended December 31, 2024, or by 14.1%, and departures decreased from 61,769 in 2023 to 54,001 in 2024, or by 12.6,%.

Although a decrease in block hours and departures during the year ended December 31, 2024, compared to the year ended December 31, 2023, resulted in a decrease in variable revenues for the year ended December 31, 2024, compared to the year ended December 31, 2023, the decrease was offset by increased revenues in the fourth quarter 2024 as a result of Amendment No 4 ("Amendment No. 4") to the American capacity purchase agreement. Amendment No. 4, executed in November 2024, increased fixed and incentive revenues available to Air Wisconsin, and shortened the period over which any remaining deferred revenues would be recognized due to the termination of the capacity purchase agreement in April 2025. As a result, overall contract revenues increased $3.6 million, or 1.8%, to $202.4 million for the year ended December 31, 2024 compared to $198.8 million for the year ended December 31, 2023. Total contract revenues for the

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year ended December 31, 2024 included $2.9 million of contract revenues that were previously deferred under the American capacity purchase agreement, compared to $13.6 million of contract revenues recognized during the year ended December 31, 2023 that were previously deferred under the United capacity purchase agreement. Air Wisconsin began flying operations for American in March 2023 and primarily all of our operating revenues since that time through the year ended December 31, 2024 were generated under the American capacity purchase agreement.

Under the American capacity purchase agreement, Air Wisconsin was also entitled to be reimbursed for certain startup costs ("non-refundable upfront fee revenue"), such as livery changes to the aircraft, to prepare the aircraft for American flight services. Through December 31, 2024, Air Wisconsin incurred $4.0 million in reimbursable startup costs. In accordance with accounting principles generally accepted in the United States of America ("GAAP"), the Company recognized contract revenues related to the total estimated non-refundable upfront fee revenue of $4.0 million on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights that were expected to be completed in subsequent periods during the remaining term of the agreement. Accordingly, during the year ended December 31, 2024 Air Wisconsin recognized $2.7 million of non-refundable upfront fee revenues with $0.8 million deferred as of December 31, 2024. Air Wisconsin's deferred revenues related to the non-refundable upfront fee revenues under the American capacity purchase agreement were adjusted over the remaining term of the agreement and were recognized as part of future contract revenues relative to future flights completed or estimated to be completed over the remaining term of the agreement.

Additionally, Air Wisconsin received certain support fees and increased rates and was reimbursed for heavy maintenance expenses based on the fixed daily amount for each aircraft covered under the agreement. In accordance with GAAP, the Company recognized revenue related to the monthly support fee, heavy maintenance revenue, and a pilot compensation assistance payment (collectively, the "maintenance and support payments") on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. The recognition of both the non-refundable upfront fees and the maintenance and support payments were modified due to changes in contractual terms under Amendment No. 4.

During the fourth quarter 2024, Air Wisconsin began to provide on-demand charter service within the contiguous United States. Under this service, Air Wisconsin negotiated a fare for the charter operations with the customer. The performance obligation was met and revenue was recognized upon completion of the flight. For the year ended December 31, 2024, charter revenues were $2,187 and represented 1.1% of the Company's contract revenues.

As of December 31, 2024, the Company had Contract liabilities, net of $4.2 million and Long-term contract liabilities, net of $0 on its consolidated balance sheet. As of December 31, 2023, the Company had a Contract liabilities, net of $0.1 million and Long-term contract liabilities, net of $3.0 million on its consolidated balance sheet.

Other revenue is immaterial and primarily consists of aircraft rental revenue and the sales of parts to other airlines. These parts are sold at fair market value.

For additional information, please refer to the section titled *"Critical Accounting Policies and Estimates — Revenue Recognition,"* in Note 1, *Summary of Significant Accounting Policies — Contract Revenues*, and Note 2, *Capacity Purchase Agreements with United and American* in the notes to the audited consolidated financial statements in this Annual Report.

***Operating Expenses***

Our total operating expenses decreased $9.5 million, or 4.0%, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The decrease in operating expenses was primarily related to decreases in expenses associated with legal fees of $7.1 million, or 82.9%, due to the cessation of the United arbitration, and aircraft maintenance, materials, and repairs of $2.3 million, or 3.8%, and insurance expense of $0.7 million, or 28.1%, as a result of decreased flying in the year ended December 31, 2024 when compared to the year ended December 31, 2023. These decreases were partially offset by increases in depreciation expense of $0.5 million, or 2.1%, and rent expense $0.5 million, or 7.9%, primarily related to simulator rent. For additional information, please refer to the section titled "–*Results of Operations—Operating Expenses*" in this Annual Report.

**Economic Conditions, Challenges and Risks Impacting Financial Results** 

Although our capacity purchase agreements tended to have the effect of reducing Air Wisconsin's exposure to certain risks and uncertainties, its operating and business performance during the years ended December 31, 2024 and

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December 31, 2023 were driven by various factors that typically affect regional airlines and the markets in which they operate, including factors that affect the broader airline and travel industries. The following key factors have materially affected operating performance and financial results. Following the Aviation Disposition on January 9, 2026, these factors are no longer directly relevant to our business.

***Pilot Shortage.*** An industry-wide pilot shortage has existed for many years, which is the result of a number of factors, including personnel seeking opportunities with larger airlines where compensation may be substantially higher, the number of pilots at major airlines reaching retirement age, upward pressure on wages and bonuses at regional and other carriers and within other industries, and the proliferation of cargo and low-cost carriers that have increased demand for pilots. As a result, Air Wisconsin, like most of its peers, during the years ended December 31, 2024 and December 31, 2023, was not able to hire and retain a sufficient number of pilots to crew all of its aircraft. This limited the number of flights it was able to fly under the United capacity purchase agreement and the American capacity purchase agreement. Following the Aviation Disposition, we no longer incur airline personnel costs.

***Industry Volatility***. The airline industry has historically been volatile and affected by numerous factors, such as tourist activity, consumer confidence, discretionary spending, fare initiatives, fuel prices, labor costs, labor actions, global pandemics, outbreak of war or hostilities, changes in governmental regulations, government sanctions, natural disasters, and changes in weather patterns. Historically, Air Wisconsin's capacity purchase agreements sheltered it from some of these factors; however, because we no longer operate an airline, we are no longer directly exposed to these industry-specific risks.

***Competition***. Air Wisconsin historically operated as a regional airline and faced competition from larger carriers with greater financial and operational resources, which contributed to the difficulties Air Wisconsin faced in seeking to enter into these markets. Following the Aviation Disposition, these competitive dynamics are no longer relevant to us.

***Maintenance Contracts, Costs and Timing****.* Historically, Air Wisconsin's results were affected by aircraft maintenance costs and the timing of major maintenance activities, which were subject to variables such as aircraft utilization, regulatory requirements, and unscheduled maintenance events. Air Wisconsin's employees performed routine airframe and engine maintenance along with periodic inspections of equipment at its maintenance facilities. Air Wisconsin also used third-party vendors for certain heavy airframe and engine maintenance work, along with parts procurement and component overhaul services for Air Wisconsin's aircraft. Since the maintenance program remained with Air Wisconsin, we no longer incur aircraft maintenance expenses following the Aviation Disposition.

***Unionized Labor****.* The airline industry is heavily unionized, and the wages, benefits and work rules of unionized airline industry employees are determined by collective bargaining agreements. As of December 31, 2024, Air Wisconsin had approximately 944 employees, of which 666 were represented by unions. Because the unionized workforce and related labor agreements remained with Air Wisconsin following the Aviation Disposition, labor relations and collective bargaining agreements are no longer relevant to the Company.

Please refer to Part I, Item 1A, *Risk Factors,* in this Annual Report for a discussion of the significant risks and uncertainties affecting our business and results of operations, and the trading price of Harbor's common stock.

**Components of Our Results of Operations** 

The following discussion summarizes the key components of our consolidated statements of operations and reflects Air Wisconsin's airline operations prior the Aviation Disposition. Following the Aviation Disposition, the airline-specific operating components are no longer directly relevant.

**Operating Revenues** 

Our consolidated operating revenues consisted primarily of contract revenues from flight services for the year ended December 31, 2024.

***Contract Revenues***. Contract revenues during the twelve months ended December 31, 2024, and December 31, 2023, consisted of fixed monthly amounts per aircraft pursuant to both the American and United capacity purchase agreements, along with the additional amounts received based on the number of departures and block hours flown. Each of these agreements provided for provisional cash payments each month based on a projected level of flying each month. Commencing in September 2023, the American capacity purchase agreement further provided for performance bonuses and rebates. Air Wisconsin subsequently reconciled these payments to the actual completed flight activity on a monthly basis. Flying operations with United ceased in early June 2023 and all amounts were subsequently reconciled. Flight

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operations began for American in March 2023 and ceased in April 2025, and all payments were subsequently reconciled to the actual completed flight activity.

***Contract Services and Other****.* Contract services and other revenue are not material and primarily consist of aircraft rental revenue and the sale of parts.

**Operating Expenses**

Our consolidated operating expenses consisted of the following items:

***Payroll and Related Costs****.* Payroll and related costs primarily relate to wages, benefits and payroll taxes for all of Air Wisconsin's employees, as well as costs related to lodging of our flight crews and crew training expenses.

***Aircraft Fuel and Oil***. Substantially all aircraft fuel and related fueling costs for flying under both the American and United capacity purchase agreements were directly paid and supplied by American or United, as applicable, and we did not record any revenue or expense for such fuel. Under the American capacity purchase agreement, we were reimbursed for certain startup expenses, including fuel, to prepare our aircraft for American flight services. We were responsible for the cost of aircraft oil under the capacity purchase agreements, although that expense was not material.

***Aircraft Maintenance, Materials and Repairs****.* Aircraft maintenance, materials and repairs include costs related to airframe and rotable overhauls, normal recurring maintenance and the cost of aircraft materials and parts related to Air Wisconsin's CRJ-200 regional jets and the cost of engine maintenance by Lotus. With the exception of engine overhauls by Air Wisconsin, we recorded these costs using the direct expense method of accounting, pursuant to which component repair work was expensed when parts were shipped for repair, while airframe and engine overhauls were expensed when the maintenance work was completed. As a result of using the direct expense method, the timing of maintenance expense reflected in the financial statements may vary from period to period. We capitalized Air Wisconsin's engine overhaul costs, and the amortization expense is included in aircraft maintenance, materials and repairs using the deferral method of accounting; Air Wisconsin's engine overhaul costs were amortized over the estimated useful life of the overhaul measured in engine cycles remaining until the next scheduled shop visit.

***Other Rents****.* Other rents include expenses related to leased engines, costs related to leased flight simulators used to train Air Wisconsin's pilots, and building rents such as crew and maintenance bases and corporate office space.

***Depreciation, Amortization and Obsolescence****.* Depreciation expense is a periodic non-cash charge primarily related to aircraft, engine and rotable parts depreciation. Amortization expense is a periodic non-cash charge primarily related to capitalized engine overhauls. Obsolescence expense is a periodic non-cash charge primarily related to the provision for obsolescence of our expendable aircraft parts.

***Purchased Services and Other****.* Purchased services and other expense primarily includes information technology system costs, legal fees, professional and technical fees, gains and losses on disposals of fixed assets, insurance premiums, property taxes and other administrative expenses. The majority of insurance premiums and property taxes were pass-through costs to United and American prior to the termination of the respective capacity purchase agreements.

**Other (Expense) Income, Net** 

***Interest and Dividend Income****.* Interest and dividend income primarily includes interest and dividends earned on our cash and cash equivalents and our investments in marketable securities.

***Interest Expense****.* Interest expense in the year ended December 31, 2024 was immaterial.

***Gain (Loss) on Marketable Securities and Long-term Restricted Investments****.* The gain or loss reflects the change in the market value of our Marketable securities and Long-term restricted investments and any gains or losses associated with their sales for the year ended December 31, 2024. For the year ended December 31, 2024, the Company recorded a gain on its Marketable securities of $1.0 million and a gain of $0.6 million on its Long-term restricted investments that are contained within the Supplemental Executive Savings Plan. The combined gain of $1.6 million is recorded as Gain on marketable securities and long-term restricted investments in the consolidated statements of operations. For the year ended December 31, 2023, the Company recorded a gain on its Marketable securities and Long-term restricted investments of $5.9 million, of which $2.2 million related to the Company's Long-term restricted investments. For additional information, please refer to Note 8, *Retirement and Other Benefit Plans*, in the notes to the audited consolidated financial statements in this Annual Report.

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***Gain on Extinguishment of Debt.*** In 2018, Air Wisconsin entered into a debt restructuring agreement with a lender which was classified as a troubled debt restructuring. As such, the future undiscounted interest payments were capitalized as part of the carrying value of the debt. The prepayment of a portion of this debt during the year ended December 31, 2023, resulted in the abatement of the future interest amounts that were previously capitalized as part of the 2018 debt restructuring and were recognized as a gain on extinguishment of debt. Similarly, a repayment of the debt at a discount during the year ended December 31, 2023 was also recognized as gain on extinguishment of debt to the extent of the discount realized. As a result of the debt repayments, as of December 31, 2023 and December 31, 2024, Air Wisconsin no longer had any debt outstanding or debt service obligations. For additional information, please refer to Note 4, *Debt*, in the notes to the audited consolidated financial statements in this Annual Report.

***Other, Net****.* Other expenses include income (expense) derived from activities not classified in any other area of the consolidated statements of operations.

**Segment Reporting** 

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker ("CODM"), who for the year ended December 31, 2024, was the President and Chief Executive Officer of Air Wisconsin, in deciding how to allocate resources and in assessing operating performance. Under Accounting Standards Codification Topic 280, *Segment Reporting*, for the year ended December 31, 2024, the Company has one reportable segment that is managed on a consolidated basis providing scheduled flight services for American under the American capacity purchase agreement and on-demand charter service within the contiguous United States and Canada.

Our CODM evaluated the Company's financial information and resources on a consolidated net loss basis. Significant expenses that are regularly provided to the CODM for the Company's one reportable segment are presented on the consolidated statements of operations and are included within the reported measure of consolidated Net loss. Additionally, the measure of segment assets is reported on the consolidated balance sheets as Total assets.

**Results of Operations** 

The following discussion reflects Air Wisconsin's airline operations prior to the Aviation Disposition. Our business operations and financial condition following the Aviation Disposition are materially different from our historical business operations and financial condition, and historical results should not be viewed as indicative of future performance.

***Comparison of the Years Ended December 31, 2024 and December 31, 2023***

We had an operating loss of $24.2 million for the year ended December 31, 2024, compared to an operating loss of $36.9 million for the year ended December 31, 2023. For the year ended December 31, 2024, we had a net loss of $17.2 million compared to a net loss of $16.0 million for the year ended December 31, 2023.

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The following table sets forth our major operational statistics and the associated percentage changes for the periods presented:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, | Year Ended<br>December 31, | Year Ended<br>December 31, | | | |
| | 2024 | 2024 | 2023 | 2023 | Change | Change | Change |
| Operating Data: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available Seat Miles ("ASMs") (in thousands) | 732446 | 732446 | 905729 | 905729 | (173283) | (173283) | (19.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual Block Hours | 74742 | 74742 | 87011 | 87011 | (12269) | (12269) | (14.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual Departures | 54001 | 54001 | 61769 | 61769 | (7768) | (7768) | (12.6%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenue Passenger Miles ("RPMs") (in thousands) | 607135 | 607135 | 759844 | 759844 | (152709) | (152709) | (20.1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Average Stage Length (in miles) | 278 | 278 | 301 | 301 | (23) | (23) | (7.6%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract Revenue Per Available Seat Mile (in cents) | 27.63 | ¢ | 21.95 | ¢ | 5.68 | ¢ | 25.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Passengers | 2154829 | 2154829 | 2502123 | 2502123 | (347294) | (347294) | (13.9%) |

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The decrease in ASMs, block hours, departures, passengers and RPMs during the year ended December 31, 2024, compared to the year ended December 31, 2023, was primarily due to the industry-wide pilot shortage which resulted in a significantly lower number of flights and the transition from flying for United to flying for American. During the transition period aircraft were removed from flight services for United and prepared for service for American. During this time, the transitioned aircraft did not generate revenue (other than with respect to the reimbursement of certain costs which were then recognized over the term of the American capacity purchase agreement on a proportional basis taking into account the number of flights actually completed relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement) and thus contributed to lower ASMs, block hours, departures, RPMs and passengers. The increase in contract revenue per available seat mile during the year ended December 31, 2024, compared to the year ended December 31, 2023, was primarily attributable to increased rates in the American capacity purchase agreement, when compared to the United capacity purchase agreement, along with a shorter average stage length.

**Operating Revenues** 

The following table sets forth our operating revenues and the associated dollar and percentage changes for the periods presented:

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| | | | | |
|:---|:---|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, | | |
| | 2024 | 2023 | Change | Change |
| Operating Revenues ($ in thousands): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract Revenues | $202375 | $198833 | $3542 | 1.8% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract Services and Other | 8 | 372 | (364) | (97.8%) |
| Total Operating Revenues | $202383 | $199205 | $3178 | 1.6% |

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Although a decrease in block hours and departures during the year ended December 31, 2024, compared to the year ended December 31, 2023, resulted in a decrease in variable revenues for the year ended December 31, 2024, compared to the year ended December 31, 2023, Amendment No 4 ("Amendment No. 4") to the American capacity purchase agreement, executed in November 2024, resulted in additional fourth quarter 2024 revenues. Amendment No. 4 increased fixed and incentive revenues available to Air Wisconsin, and shortened the period over which any remaining deferred revenues would be recognized due to the termination of the capacity purchase agreement in April 2025. As a result, overall contract revenues increased $3.6 million, or 1.8%, to $202.4 million for the year ended December 31, 2024 compared to $198.8 million for the year ended December 31, 2023. Overall, total operating revenues increased $3.2 million, or 1.6%, during the year ended December 31, 2024, compared to the year ended December 31, 2023. For additional information, please refer to

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Note 1, *Summary of Significant Accounting Policies*, in the notes to the audited consolidated financial statements in this Annual Report.

**Operating Expenses** 

The following table sets forth our operating expenses and the associated dollar and percentage changes for the periods presented:

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| | | | | |
|:---|:---|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, | | |
| | 2024 | 2023 | Change | Change |
| Operating Expenses ($ in thousands): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payroll and Related Costs | $122102 | $121697 | $405 | 0.3% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aircraft Fuel and Oil | 340 | 517 | (177) | (34.2%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aircraft Maintenance, Materials and Repairs | 58476 | 60783 | (2307) | (3.8%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Rents | 6698 | 6210 | 488 | 7.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation, Amortization and Obsolescence | 26051 | 25523 | 528 | 2.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchased Services and Other | 12919 | 21346 | (8427) | (39.5%) |
| Total Operating Expenses | $226586 | $236076 | $(9490) | (4.0%) |

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Our total operating expenses consist of the following items:

***Payroll and Related Costs***. Payroll and related costs increased $0.4 million, or 0.3%, to $122.1 million for the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase was primarily driven by increases in pilot wages due to pay rate increases of $4.0 million, offset by reduced pilot bonuses of $2.8 million, maintenance employee wages of $1.6 million, and payroll benefits of $0.7 million. These increases were offset by decreases to management wages of $0.9 million inclusive of a non-cash adjustment of $0.6 million related to the supplemental executive savings plan, flight attendant wages of $0.4 million, per diem of $0.4 million and a net decrease in other personnel expenses of $1.1 million.

***Aircraft Fuel and Oil***. Substantially all of the fuel costs incurred as a result of flying pursuant to the American capacity purchase agreement during the year ended December 31, 2024 and the American and United capacity purchase agreements during the year ended December 31, 2023 were directly paid to suppliers by American and United. During the year ended December 31, 2024, Air Wisconsin had a decrease of $0.2 million, or 34.2%, in fuel costs related to maintenance flights and preparing its aircraft for flight services pursuant to the American capacity purchase agreement primarily as a result of lower departures and block hours. We were responsible for the cost of aircraft oil under both the United capacity purchase agreement and the American capacity purchase agreement, although this expense was not material.

***Aircraft Maintenance, Materials and Repairs***. Aircraft maintenance, materials and repairs costs decreased $2.3 million, or 3.8%, to $58.5 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily as a result of reduced flying levels during the year ended December 31, 2024 when compared to year ended December 31, 2023. The decrease was primarily driven by decreases in airframe repairs of $5.5 million, net scraps of $0.2 million, and overhaul amortization of $0.7 million due to lower departures. These decreases were partially offset by an increase in materials used of $2.9 million, engine repairs of $0.6 million, shop supplies and tools of $0.2 million, freight expenses of $0.2 million, and a decrease in rebates of $0.2 million.

***Other Rents***. Other rents expense increased $0.5 million, or 7.9%, to $6.7 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily as a result of increases in flight simulator rent of $0.4 million.

***Depreciation, Amortization and Obsolescence***. Depreciation, amortization and obsolescence expense increased $0.5 million, or 2.1%, to $26.1 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.

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This was primarily due to $0.3 million increase in rotable depreciation expense for the year ended December 31, 2024 when compared to the year ended December 31, 2023.

***Purchased Services and Other***. Purchased services and other expense decreased $8.4 million, or 39.5%, to $12.9 million for the year ended December 31, 2024, compared to the year ended December 31, 2023. The decrease was primarily due to a decrease in legal expenses of $7.1 million related to the United arbitration, along with decreases in insurance expense of $0.7 million, landing fees of $0.3 million, uncollectible accounts of $0.2 million, and advertising expense of $0.1 million.

**Other (Expense) Income** 

***Interest and Dividend Income***. Interest and dividend income decreased $1.2 million for the year ended December 31, 2024, compared to the year ended December 31, 2023. The decrease was primarily due to a decrease in investment income earned on marketable securities and other investments of $1.4 million primarily as a result of decreasing interest rates, which was partially offset by an increase of $0.2 million for aircraft sales-lease interest.

***Interest Expense***. Interest expense was immaterial and remained relatively unchanged for the year ended December 31, 2024, compared to the year ended December 31, 2023.

***Gain on Marketable Securities and Long-term Restricted Investments****.* Gain on marketable securities and long-term restricted investments decreased $4.3 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily as a result of a decrease in the market value of our marketable securities and a non-cash gain adjustment in the amount of $0.5 million related to Long-term restricted investments within the SESP. The value of the Marketable securities decreased primarily as a result of decreasing interest rates during the year ended December 31, 2024.

***Gain on Extinguishment of Debt***. Gain on extinguishment of debt decreased $6.2 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily as a result of the prepayment of Air Wisconsin's outstanding debt obligations during the year ended December 31, 2023. For additional information, please refer to Note 4, *Debt*, in notes to the audited consolidated financial statements in this Annual Report.

***Other, Net***. Other income and expense was immaterial and relatively unchanged for the year ended December 31, 2024, compared to the year ended December 31, 2023.

**Net Loss** 

Net loss for the year ended December 31, 2024 was $17.2 million, or $0.36 per basic and diluted share, compared to net loss of $16.0 million, or $0.39 per basic share and diluted share, for the year ended December 31, 2023. For additional information, please refer to Note 11, *Earnings Per Share and Equity*, in the notes to the audited consolidated financial statements in this Annual Report.

The net loss for the year ended December 31, 2024, was similar when compared to the net loss for the year ended December 31, 2023. Slightly higher revenues and lower operating expenses for the year ended December 31, 2024 when compared to the year ended December 31, 2023 resulted in an improved operating loss of $12.7 million. However, this was offset by $13.9 million due to lower gains on Marketable securities and Long-term restricted investments, no further gains on the extinguishment of debt, and a lower tax benefit as a result of increases to valuation allowances on deferred tax assets.

***Income Taxes***

In the year ended December 31, 2024, our effective tax rate was 6.4%, compared to 17.4% in the year ended December 31, 2023. Our tax rate can vary depending on changes in tax laws, adoption of accounting standards, the amount of income we earn in each state and the state tax rate applicable to such income, as well as any valuation allowance required on our deferred tax assets. The primary driver of the effective tax rate difference between 2024 and 2023 was the higher rate at which the valuation allowances increased in 2024 compared to 2023 on deferred tax assets that are ordinary in nature.

We recorded an income tax benefit of $1.2 million and $3.4 million for the years ended December 31, 2024 and December 31, 2023, respectively.

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The income tax benefit for the year ended December 31, 2024 resulted in an effective tax rate of 6.4%, which differed from the U.S. federal statutory rate of 21.0%, primarily due to the impact of state income taxes, permanent differences between financial statement and taxable income, and an increase in the valuation allowances recorded against federal and state deferred tax assets that were ordinary in nature, partially offset by a decrease in valuation allowances recorded against deferred tax assets that are capital in nature. In addition to the state effective tax rate impact, other state impacts include changes in state apportionment and statutory rates.

The income tax provision for the year ended December 31, 2023 resulted in an effective tax rate of 17.4%, which differed from the U.S. federal statutory rate of 21.0% primarily due to the impact of state income taxes, permanent differences between financial statement and taxable income, and valuation allowances recorded against federal and state deferred tax assets that were ordinary in nature, partially offset by a decrease in valuation allowances recorded against deferred tax assets that were capital in nature. In addition to the state effective tax rate impact, other state impacts included changes in state apportionment and statutory rates.

As of December 31, 2024, and December 31, 2023 we had federal net operating loss carryforwards of approximately $25.5 million and $31.6 million, respectively, and state net operating loss carryforwards of approximately $26.0 million and $28.7 million, respectively. The state net operating losses expire beginning in 2032, with some states having either longer expiration periods or none at all.

With the exception of two states requiring the processing of the amended federal return before the filing of the state amended return, the Company has filed amended 2021 and 2022 federal and state income tax returns as a result of the United Arbitration Award and the restatement of the previously issued consolidated financial statements for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023. The 2021 amended income tax returns are expected to result in federal and state tax refunds of approximately $0.3 million and $0.1 million, respectively. The 2022 amended income tax returns are expected to result in federal and state tax refunds of approximately $6.5 million and $0.6 million, respectively. The anticipated 2021 federal tax refund is recorded in Receivables, net, while the 2022 federal tax refund is reflected in Other assets in the long-term section in the consolidated balance sheets for the year ended December 31, 2024. Meanwhile, the remaining anticipated state tax refunds are divided between Receivables, net and Other (long-term assets) in the amounts of $0.3 million and $0.3 million, respectively, in the consolidated balance sheets. The classification of these amounts is dependent on when the Company expects to receive the anticipated tax refund amounts. The filing of the 2022 federal amended tax return also resulted in a net operating loss carryforward to 2023 of approximately $14.9 million, and various state net operating loss carryforwards to 2023 totaling approximately $14.2 million.

For additional information, please refer to Note 3, Income Taxes, in the notes to the audited consolidated financial statements in this Annual Report.

**Liquidity and Capital Resources** 

***Historical Operational Performance***

During the year ended December 31, 2024, our liquidity was primarily driven by Air Wisconsin's airline operations. Air Wisconsin's departures and block hours in the year ended December 31, 2024 and the year ended December 31, 2023 were below pre-COVID-19 levels, generally due to the industry-wide pilot shortage. For the year ended December 31, 2023, departures and block hours were also negatively affected by the transition in flying from United to American. Our operational performance near the end of 2024 was also impacted by Amendment No. 4 to the American capacity purchase agreement which provided for fewer block hours than our crew capabilities. In January 2025, American provided notice to Air Wisconsin of its intent to terminate the American capacity purchase agreement effective April 2025. On January 9, 2026, we consummated the Aviation Disposition. As a result, we no longer conduct airline operations and our future liquidity is materially different from the historical operating periods discussed below.

***Historical Sources and Uses of Liquidity***

Historically, our principal sources of liquidity were our cash and cash equivalents balance, our marketable securities balances, and Air Wisconsin's cash flows from operations. As of December 31, 2024, our cash and cash equivalents balance was $15.0 million and we held $97.0 million of Marketable securities. This compares to cash and cash equivalents of $20.8 million and Marketable securities of $92.7 million as of December 31, 2023. For the year ended December 31,

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2024, cash provided by operations was $13.3 million, and for the year ended December 31, 2023, cash used in operations was $12.0 million.

In December 2023, Air Wisconsin prepaid all of the outstanding principal balance and accrued interest on its third-party secured debt with a payment of $46.4 million. This reflected a 5.5% discount to the outstanding principal balance of that debt and resulted in the abatement of the future undiscounted interest payments that, as a result of a prior restructuring, had been capitalized as part of the $52.1 million carrying value of the debt. As a result, since December 31, 2023 Air Wisconsin has not had any debt service requirements.

We received aggregate gross consideration of approximately $125.9 million as a result of the Aviation Disposition, , subject to certain customary purchase price adjustments and the impact of required tax obligations. As a result, our primary sources of liquidity now consist of cash, cash equivalents, and marketable securities, and we no longer generate operating cash flows from airline activities.

***Restricted Cash***

As of December 31, 2024, in addition to cash and cash equivalents and marketable securities, the Company had $0.7 million in restricted cash, which related to a credit facility used for the issuance of cash collateralized letters of credit supporting Air Wisconsin's obligations under certain lease agreements, airport agreements and insurance policies, as well as cash held for the repurchase of shares under Harbor's stock repurchase program. Restricted cash includes amounts escrowed in an interest-bearing account that secures the credit facility. The obligations supported by these letters of credit remained with Air Wisconsin following the Aviation Disposition.

***Operating Expenses and Capital Expenditures***

Historically, Air Wisconsin required cash to fund its operating expenses and working capital requirements, which included outlays for capital expenditures, labor, and maintenance costs. During the ordinary course of business, we would evaluate our cash requirements and, if necessary, adjust operating and capital expenditures to reflect changes in labor costs, projected demand for our flying services, required maintenance events and current market conditions. Our capital expenditures were typically used to acquire or maintain aircraft and flight equipment for Air Wisconsin. During the year ended December 31, 2024, we incurred $2.9 million in capital expenditures primarily related to purchases of rotable parts. Because the airline operations and related maintenance programs remained with Air Wisconsin after the Aviation Disposition, we do not anticipate incurring any airline-operating related costs going forward.

***Ongoing Liquidity Considerations***

After giving effect to the Aviation Disposition, our primary sources of liquidity now consist of our cash, cash equivalents and marketable securities balances (collectively, the "Liquid Assets"). Since we are no longer engaged in any operating business, and do not have any source of revenue from operations, our primary source of earnings for the foreseeable future is expected to be investment income generated from the Liquid Assets. Our investment returns must be sufficient to offset our ongoing corporate expenses, including costs associated with maintaining our public company status, pursuing strategic alternatives, and compensating our management team. We believe the Liquid Assets are sufficient to meet our liquidity requirements for at least the next 12 months from the date of this filing.

Our stockholders should be aware that, following the Aviation Disposition, we are not engaged in an operating business and our ability to create stockholder value will depend to a large extent on our ability to generate investment income and our execution of strategic alternatives.

For additional information, please refer to Part I, Item 1A, *Risk Factors,* in this Annual Report.

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***Cash Flows***

The following table presents information regarding our cash flows for each of the periods presented ($ in thousands):

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| | | | | |
|:---|:---|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, | | |
| | 2024 | 2023 | Change | Change |
| Net cash provided by (used in) operating activities | $13285 | $(12027) | $25312 | (210.5%) |
| Net cash (used in) provided by investing activities | $(5339) | $60271 | $(65610) | 108.9% |
| Net cash used in financing activities | $(13858) | $(60895) | $47037 | 77.2% |

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***Net Cash (Used in) Provided by Operating Activities***

During the year ended December 31, 2024, net cash provided by operating activities was $13.3 million. We had a net loss during the period of $17.2 million. Net cash flows were further adjusted for increases in cash primarily related to depreciation, amortization and obsolescence of $29.6 million, accounts payable of $2.5 million, contract liabilities of $1.1 million, accrued payroll and employee benefits of $0.9 million, and prepaid expenses and other of $0.6 million, which were offset by decreases for accounts receivable of $1.8 million, deferred income taxes of $1.4 million, gain on Marketable securities and Long-term restricted investments of $1.0 million, gain on the disposition of property of $0.6 million, spare parts and supplies of $0.6 million, sale-lease receivable of $0.4 million.

During the year ended December 31, 2023, net cash used in operating activities was $12.0 million. We had a net loss during the period of $16.0 million. Net cash flows were further adjusted for increases in cash primarily related to depreciation, amortization and obsolescence of $29.7 million, accounts receivable of $5.6 million, contract liabilities of $1.1 million, and prepaid expenses and other of $1.8 million, which were offset by decreases for deferred revenue of $11.6 million, accounts payable of $7.8 million, gain on extinguishment of debt of $6.2 million, gain on marketable securities of $3.7 million, deferred income taxes of $3.3 million, accrued payroll and employee benefits of $1.5 million, gain on disposition of property of $0.5 million, and sales lease receivable of $0.2 million.

***Net Cash (Used in) Provided by Investing Activities***

During the year ended December 31, 2024, net cash used in investing activities was $5.3 million, of which approximately $6.0 million was from sales of marketable securities and $0.8 million was from the disposition of property and equipment, offset by $9.2 million for purchases of marketable securities and $2.9 million for additions to property and equipment.

During the year ended December 31, 2023, net cash provided by investing activities was $60.2 million, of which approximately $99.9 million was from sales of marketable securities, offset by $35.1 million for purchases of marketable securities and $4.5 million for Additions to property and equipment.

***Net Cash Used in Financing Activities***

During the year ended December 31, 2024, net cash used in financing activities was $13.9 million, reflecting $10.7 million for the redemption of the Series C Preferred (as defined below), $2.1 million for the repurchase of Harbor's common stock and $1.1 million of dividends paid on the Series C Preferred.

During the year ended December 31, 2023, net cash used in financing activities was $60.9 million, reflecting $55.0 million in prepayments of long-term debt, $1.3 million of dividends paid on the Series C Preferred and $4.5 million to repurchase shares of Harbor's common stock.

**Commitments and Contractual Obligations** 

In December 2023, Air Wisconsin prepaid at a discount all of its outstanding third-party secured debt and accrued interest. This prepayment resulted in a $6.2 million gain on extinguishment of debt due to a 5.5% discount on the outstanding principal balance negotiated by Air Wisconsin and a decrease in previously expected future undiscounted cash

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flows used in determining the carrying value of the debt. As a result, as of December 31, 2024 and December 31, 2023, the carrying value of the debt was $0 and Air Wisconsin no longer had any debt service requirements.

***Operating Leases***

As of December 31, 2024, Air Wisconsin had $4.6 million of operating lease obligations primarily related to certain training simulators and facilities.

The following table summarizes the future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms greater than twelve months as of December 31, 2024:

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| | |
|:---|:---|
| *Fiscal Year* | Amount |
| 2025 | $3125 |
| 2026 | 572 |
| 2027 | 392 |
| 2028 | 148 |
| 2029 | 79 |
| Thereafter | 239 |
| Total lease payments | $4555 |

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These operating leases remained with Air Wisconsin following the Aviation Disposition and we do not expect to have ongoing airline-related lease commitments. Following the Aviation Disposition, we have a single lease for approximately 1,000 square feet of office space located in Appleton, WI.

For additional information, please refer to Note 5, *Lease Obligations*, in the notes to the audited consolidated financial statements in this Annual Report.

***Series C Convertible Redeemable Preferred Stock***

In January 2020, Harbor completed an acquisition from Southshore Aircraft Holdings, LLC (together with its affiliates, "Southshore") of three CRJ-200 regional jets, each having two General Electric ("GE") engines, plus five additional GE engines, in exchange for the issuance of 4,000,000 shares of Harbor's Series C Convertible Redeemable Preferred Stock (the "Series C Preferred") with an aggregate value of $13.2 million, or $3.30 per share (the "Series C Issue Price"). Air Wisconsin had leased each of these CRJ-200 regional jets and GE engines from Southshore. In January 2020, Harbor filed a Certificate of Designations, Preferences, and Rights of Series C Convertible Redeemable Preferred Stock ("Certificate of Designations") with the Secretary of State of the State of Delaware, which established the rights, preferences, privileges, qualifications, restrictions and limitations relating to the Series C Preferred.

Each share of Series C Preferred was initially convertible at the election of the holders, at any time after issuance, into that number of shares of common stock determined by dividing the then applicable Series C Liquidation Amount (as defined below) by $0.80, subject to certain adjustments set forth in the Certificate of Designations ("Conversion Price"). The Conversion Price was subsequently adjusted to be $0.15091.

On March 28, 2024, the board of directors declared aggregate dividends in the amount of $466 on the Series C Preferred, which was paid on March 29, 2024. On June 28, 2024, the board of directors declared aggregate dividends in the amount of $519 on the Series C Preferred, which was paid on June 28, 2024.

On June 28, 2024, certain shares of Series C Preferred were converted into 16,500,000 shares of Harbor's common stock, and all remaining shares of Series C Preferred were redeemed for $10.7 million. After giving effect to such conversion and redemption, no shares of Series C Preferred remained outstanding.

Based on the applicable accounting guidance, Harbor was required to apply the "if-converted" method to the Series C Preferred to determine the weighted average number of shares outstanding for purposes of calculating the net loss per share of common stock. However, conversion was not assumed during the portion of the year the Series C Preferred was outstanding, for purposes of computing diluted loss per share, since the effect would have been anti-dilutive due to the net loss position for the year ended December 31, 2024.

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**Debt and Credit Facilities** 

***Aircraft Credit Agreements***

In December 2018, Air Wisconsin entered into a debt restructuring agreement with a lender, which held certain senior aircraft notes and subordinated aircraft notes. The senior aircraft notes were exchanged for notes in an aggregate principal amount of $70,000 ("Aircraft Notes") and the principal and accrued interest on the subordinated aircraft notes were forgiven and deemed paid in full. In December 2023, Air Wisconsin prepaid at a discount the entire outstanding principal balance of the Aircraft Notes together with all accrued interest. As a result of the prepayment, as of December 31, 2024 and December 31, 2023, Air Wisconsin no longer had any debt outstanding or debt service obligations, the liens and security interests securing the Aircraft Notes were released, and it ceased being subject to the restrictive covenants contained in the credit agreements.

***Payroll Support Program***

In April 2020, Air Wisconsin entered into a Payroll Support Program Agreement ("PSP-1 Agreement") with the U.S. Department of Treasury("Treasury") for payroll support and received approximately $42.2 million. In March 2021, Air Wisconsin entered into a Payroll Support Program Extension Agreement ("PSP-2 Agreement") with the Treasury for payroll support and received approximately $33.0 million. In June 2021 Air Wisconsin entered into a Payroll Support Program 3 Agreement ("PSP-3 Agreement", and together with the PSP-1 Agreement and the PSP-2 Agreement, the "PSP Agreements") with the Treasury for payroll support and received approximately $33.3 million.

In September 2020, the Treasury's Office of Inspector General ("OIG") commenced a routine audit of Air Wisconsin's compliance with the terms of the PSP-1 Agreement. Air Wisconsin received preliminary results from the OIG of the audit in June 2023. Those results are subject to Air Wisconsin's opportunity to contest the findings and the OIG releasing its final determination. In August 2025, Air Wisconsin received draft comments from the OIG indicating that it had overstated its awardable amount on its PSP-1 application. Air Wisconsin responded that the overstatement was corrected in its PSP-1 recertification submitted in connection with its PSP-2 Agreement. Air Wisconsin also indicated it may be due additional funds under PSP-2; however, Air Wisconsin does not believe that it will be required to repay any amount to the Treasury or that it will receive any further funds under the program. Air Wisconsin received follow-up communication in November 2025 from the OIG that it was still processing its final comments. No audits have been initiated by the Treasury under the PSP-2 Agreement or PSP-3 Agreement as of the date of this filing. For additional information, please refer to Note 7, *Commitments and Contingencies,* in the notes to the audited consolidated financial statements in this Annual Report.

**Maintenance Commitments** 

As of December 31, 2024, Air Wisconsin was party to a non-exclusive heavy maintenance services agreement for certain maintenance, repair and modification services with respect to airframes owned or operated by Air Wisconsin. Since the maintenance program and related agreements remained with Air Wisconsin following the Aviation Disposition, we do not anticipate incurring any ongoing airline maintenance costs.

**Off-Balance Sheet Arrangements** 

An off-balance sheet arrangement is any transaction, agreement or other contractual arrangement involving an unconsolidated entity under which a company has (i) made guarantees, (ii) a retained or a contingent interest in transferred assets, (iii) an obligation under derivative instruments classified as equity or (iv) any obligation arising out of a material variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to us, or that engages in leasing, hedging or research and development arrangements with us.

We have no off-balance sheet arrangements that would have or are reasonably likely to have a material current or future effect on our financial condition, results of operations or liquidity.

**Seasonality** 

Our results of operations during the year ended December 31, 2024, and for any interim period were not necessarily indicative of our results for the entire year because the airline industry is subject to seasonal fluctuations, including those relating to holiday and summer travel schedules, changes in weather patterns and natural disasters, as well as fluctuations associated with changes in general economic conditions, including fuel prices, interest rates, inflation, discretionary

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spending and consumer confidence. Following the Aviation Disposition, we are no longer engaged in airline operations and do not expect our future results to be subject to related seasonal trends.

**Critical Accounting Policies and Estimates** 

We prepare our consolidated financial statements in accordance with generally accepted accounting principles. Critical accounting policies are those policies that are most important to the preparation of our consolidated financial statements and require management's subjective and complex judgments due to the need to make estimates about the effect of matters that are inherently uncertain. In doing so, we must make estimates and assumptions that affect our reported amounts of assets, liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities. To the extent there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on past experience, existing and known circumstances, authoritative accounting guidance, and other factors and assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. For the years presented, our critical accounting policies relate to revenue recognition, long-lived assets, and income taxes. The application of these accounting policies involves the exercise of judgment and the use of assumptions as to the future uncertainties and, as a result, actual results will likely differ, and may differ materially, from such estimates.

We have identified the accounting policies discussed below as critical to us. The discussion below is not intended to be a comprehensive list of our accounting policies. Our significant accounting policies are more fully described in Note 1, *Summary of Significant Accounting Policies*, in the notes to the audited consolidated financial statements in this Annual Report.

***Revenue Recognition***

Historically, we derived substantially all of our revenue from capacity purchase agreements with major airlines. In performing an analysis of the American and United capacity purchase agreements within the framework of Accounting Standards Update ("ASU") No. 2016-02, *Leases* ("ASC 842") and Accounting Standards Codification Topic 606, *Revenue from Contracts with Customers* ("ASC 606")*,* each issued by the Financial Accounting Standards Board ("FASB"), we determined that a portion of the payments we received under the agreements that was designed to reimburse Air Wisconsin for use of a certain number of aircraft, which is referred to as "right of use," was considered lease revenue. All other revenue received by Air Wisconsin under the capacity purchase agreements was considered non-lease revenue. After consideration of the lease and non-lease components, within the context of ASC 842, we determined the non-lease component to be the predominant component of each capacity purchase agreement and elected a practical expedient to not separate the lease and non-lease components. Therefore, all compensation received by Air Wisconsin pursuant to the American capacity purchase agreement and the United capacity purchase agreement has been accounted for under ASC 606.

Because our flights under the United and American capacity purchase agreements provided distinct services that had the same pattern of transfer to the customer, which were satisfied over time with the measure of progress for each flight deemed to be substantially the same, the flight services provided under the American and United capacity purchase agreements represented a series of services that were accounted for as a single performance obligation. Therefore, our contract revenues were recognized when service was provided and our performance obligation was determined on a per completed flight basis. The performance obligation of each completed flight was measured using departures.

Under each agreement, Air Wisconsin was entitled to receive certain payments based on the number of aircraft covered under the agreement, block hours, departures and certain performance metrics. Each agreement also provided for the reimbursement to Air Wisconsin of certain direct operating expenses, such as certain insurance premiums and property taxes.

As discussed above, under both the American capacity purchase agreement and the United capacity purchase agreement, Air Wisconsin was paid a fixed amount per aircraft per day for each month during the term of the agreement. Previously, under the United capacity purchase agreement, in accordance with GAAP, the Company recognized revenue related to the fixed payments on a proportional basis taking into account the number of flights actually completed in that period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. Air Wisconsin deferred fixed revenues between April 2020 and June 2021 due to the significant decrease in its completed flights as a result of the COVID-19 pandemic. Beginning in July 2021, due to an increase in completed flights and based on projected future completed flight activity, Air Wisconsin began reversing this deferral of fixed revenues and

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continued to do so through June 1, 2023, the end of the contract period. Accordingly, during the year ended December 31, 2024, Air Wisconsin recognized $2.9 million of fixed revenues that were previously deferred, compared to recognition of $11.6 million of fixed revenues that were previously deferred in the year ended December 31, 2023. Air Wisconsin's deferred revenues related to the fixed portion of revenue under the United capacity purchase agreement adjusted over the contract term based on the number of flights completed in each reporting period relative to the number of flights that had been expected to be completed over the remaining contract term.

Following the Aviation Disposition on January 9, 2026, we do not have any material operating assets and are not engaged in any operating business. Revenue recognition considerations related to airline operations are no longer applicable to our financial condition.

***Long-Lived Assets***

As of December 31, 2024, we had approximately $48.2 million of property and equipment and related assets net of accumulated depreciation. In accounting for these long-lived assets, we made estimates about the expected useful lives of the assets, the expected residual values of these assets, and the potential for impairment based on the fair value of the assets and the cash flows they are expected to generate. We also made a determination as to the asset group to be tested and whether the enterprise level is the appropriate level for such testing. Factors indicating potential impairment include, but are not limited to, significant decreases in the market value of the long-lived assets, a significant change in the condition of the long-lived assets, a significant adverse change in the extent or manner in which long-lived assets (asset group) are being used, and operating cash flow losses associated with the use of the long-lived assets. When considering whether or not impairment of long-lived assets exists, we group similar assets together at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and compare the undiscounted cash flows for each asset group to the net carrying amount of the assets supporting the asset group. In the Company's situation the lowest level for which identifiable cash flows are available is at the enterprise level. Substantially all of our operating long-lived assets remained with Air Wisconsin following the Aviation Disposition, and impairment considerations related to airline operations are no longer applicable to our financial condition.

***Income Taxes***

The Company utilizes the asset and liability method for accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are determined based upon the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities, as measured by the current enacted tax rates. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. Deferred tax expense represents the result of changes in deferred tax assets and liabilities. Estimating our tax assets and liabilities involves judgments related to uncertainties in the application of complex federal and state tax regulations. Determining whether deferred tax assets are realizable requires significant judgment, including but not limited to, forecasting the reversal of temporary differences. A valuation allowance is provided for those deferred tax assets for which we cannot conclude that it is more likely than not that such deferred tax assets will be realized. In determining the amount of any valuation allowance, in addition to the reversal of temporary differences, estimated future taxable income as well as feasible tax planning strategies for each taxing jurisdiction, are considered. If we determine it is more likely than not that all or a portion of the remaining deferred tax assets will not be realized, the valuation allowance will be increased with a charge to income tax expense. Conversely, if we determine we are more likely than not to be able to utilize all or a portion of the deferred tax assets for which a valuation allowance was previously provided, the related portion of the valuation allowance will be recorded as a reduction to income tax expense. In addition to our assessment of the need for valuation allowances, we make certain estimates and judgments to determine tax expense for financial statement purposes as we evaluate the effect of tax credits, tax benefits, and deductions, some of which result from differences in the timing of recognition of revenue or expense for tax and financial statement purposes. Changes to these estimates may result in significant changes to our tax provision in future periods. Each fiscal quarter we re-evaluate our tax provision and reconsider our estimates and assumptions related to specific tax assets and liabilities, making adjustments as circumstances change.

As required by the uncertain tax position guidance, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company has applied the uncertain tax position guidance to all tax positions for which the statute of limitations remains open.

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The Company is subject to federal, state and local income taxes in the United States. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require the application of significant judgment. The Company is no longer subject to U.S. federal income tax examinations for the years prior to 2021. With a few exceptions, the Company is no longer subject to state or local income tax examinations for the years prior to 2020. As of December 31, 2024, the Company had no outstanding tax examinations.

**Upcoming Accounting Pronouncements**

For information about upcoming accounting pronouncements, please refer to Note 1, *Summary of Significant Accounting Policies*, in the notes to the audited consolidated financial statements in this Annual Report.

**Stock Repurchase Program** 

In March 2021 Harbor's board of directors adopted a stock repurchase program pursuant to which Harbor could initially repurchase up to $1.0 million of shares of its common stock during the first calendar month of the program, subject to an automatic increase of $1.0 million per calendar month thereafter. The number of shares to be repurchased, and the timing of any such repurchases, depend on a number of factors, including the trading price and volume of the common stock, the Company's business strategy, financial performance, liquidity position and capital requirements, restrictions in commercial agreements, general market conditions, applicable legal requirements and other factors. Repurchases may be effected through open market transactions, privately negotiated transactions, or any other lawful means. Harbor may, but is not required to, effect repurchases under a trading plan adopted pursuant to Rule 10b5-1 under the Exchange Act, or subject to Rule 10b-18 under the Exchange Act. Harbor is not obligated under the program to acquire any particular dollar amount or number of shares, and the program may be modified, suspended or terminated at any time and for any reason. Harbor acquired an aggregate of 1,132,594 shares of its common stock pursuant to the stock repurchase program during the year ended December 31, 2024. From the inception of the program through March 31, 2025, Harbor has purchased approximately 12.9 million shares of its common stock pursuant to the program. No shares have been purchased since that date.

**ITEM 7A.&nbsp;&nbsp;&nbsp;&nbsp; QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK** 

In December 2023, Air Wisconsin prepaid all of its outstanding debt including accrued interest. Since then, the Company has had no outstanding debt. Accordingly, we do not have exposure to interest rate risk associated with borrowings. However, following the Aviation Disposition, our assets primarily consist of cash equivalents and marketable securities. As a result, we are exposed to market risk related to our investment portfolio. We are subject to interest rate risk and market value risk associated with changes in prevailing interest rates. Increases in interest rates may reduce the fair value of fixed-income securities that we hold, while decreases in interest rates may reduce the yields on newly invested funds and on funds reinvested at maturity.

We are also exposed to credit risk to the extent that we invest in debt securities or maintain deposits with financial institutions. Although we seek to mitigate any such risk by investing primarily in high-quality instruments and by monitoring creditworthiness of counterparties, adverse changes in credit markets could affect the value or liquidity of such instruments.

We have not generated or incurred, and do not expect to generate or incur, revenue or expenses in foreign currencies. As a result, we have not been, and do not expect to be, subject to foreign currency exchange risk.

Inflation has not historically had a material impact on our results of operations. Following the Aviation Disposition, our primary expenses consist of corporate overhead and professional fees, and our revenues are primarily derived from investment income. Accordingly, inflation is not expected to have a material direct effect on our business, although broader economic conditions may indirectly affect interest rates and investment returns.

**ITEM 8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA** 

The Company's consolidated financial statements as of and for the years ended December 31, 2024 and December 31, 2023, and the Report of Independent Registered Public Accounting Firm, are included in this Annual Report as set forth in the index.

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**Index to Consolidated Financial Statements** 

---

| | |
|:---|:---|
| **<u>[Report of Independent Registered Public Accounting Firm](#iab8ee63cdd734c278196d516ae236d0c_100)[Grant Thornton LLP](#iab8ee63cdd734c278196d516ae236d0c_100)</u> (PCAOB ID. No. 248)** | [50](#iab8ee63cdd734c278196d516ae236d0c_100) |
| **Financial Statements** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Balance Sheets](#iab8ee63cdd734c278196d516ae236d0c_103)</u> |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Operations](#iab8ee63cdd734c278196d516ae236d0c_106)</u> | [52](#iab8ee63cdd734c278196d516ae236d0c_103)-[53](#i110b90db9e134a2783c72f2ff4c79879_219) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Stockholders' Equity](#iab8ee63cdd734c278196d516ae236d0c_109)</u> | [55](#iab8ee63cdd734c278196d516ae236d0c_109) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>[Consolidated Statements of Cash Flows](#iab8ee63cdd734c278196d516ae236d0c_112)</u> | [56](#iab8ee63cdd734c278196d516ae236d0c_112) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>[Notes to Consolidated Financial Statements](#iab8ee63cdd734c278196d516ae236d0c_115)</u> | [57](#iab8ee63cdd734c278196d516ae236d0c_115)-108 |

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** 

Board of Directors and Stockholders

Harbor Diversified, Inc. and Subsidiaries

**Opinion on the financial statements** 

We have audited the accompanying consolidated balance sheets of Harbor Diversified, Inc. (a Delaware corporation) and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations, stockholders' equity, and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

**Basis for opinion** 

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

**Critical audit matter**

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

**Capacity purchase agreement with American Airlines**

As described further in Note 1 to the consolidated financial statements, the Company entered into a capacity purchase agreement ("CPA") with American Airlines ("American") during 2022, which was subsequently amended during 2023 and 2024. The Company performed an analysis of the American CPA and related amendments in accordance with the framework of Accounting Standards Update ("ASU") No. 2016-02, Leases ("ASC 842"), and ASU No. 2014-09, Revenue from Contracts with Customers ("ASC 606"). After consideration of the lease and non-lease components within the context of ASC 842, the Company elected the practical expedient to not separate the lease and non-lease components. As a result, all compensation received by the Company under the American CPA and related amendments has been accounted for under ASC 606. We identified the accounting treatment of the American CPA and related amendments as a critical audit matter.

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The principal considerations for our determination that the accounting treatment of the American CPA and related amendments is a critical audit matter are the high degree of auditor judgment, subjectivity and effort in performing procedures to evaluate whether terms and conditions of the American CPA and related amendments were appropriately identified and evaluated by management with respect to the application of ASC 606 and considerations of ASC 842.

Our audit procedures related to the accounting treatment of the American CPA and related amendments included the following, among others:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We obtained and read the American CPA and related amendments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We consulted with national office resources regarding the appropriateness of management's application of accounting for the American CPA and related amendments under ASC 606 and considerations of ASC 842.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We obtained the Company's revenue schedules and recalculated the revenue recognized under the American CPA and related amendments. Additionally, we confirmed revenue recognized directly with American and compared revenue recognized to cash collected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We assessed the sufficiency of management's disclosures related to the revenue recorded under the American CPA and related amendments.

/s/ GRANT THORNTON LLP

We have served as the Company's auditor since 2020.

Milwaukee, Wisconsin

April 8, 2026

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**Harbor Diversified, Inc. and Subsidiaries**

**Consolidated Balance Sheets (in thousands, except share amounts and per share values)**<br>

---

| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| **Assets** |  |  |
| **Current Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $14952 | $20776 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted cash | 667 | 755 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Marketable securities | 97018 | 92747 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Receivables, net | 7380 | 5592 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales lease receivable, net | 470 | 753 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Spare parts and supplies, net | 5399 | 4810 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract costs | 146 | 111 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other | 1891 | 2115 |
| **Total Current Assets** | 127923 | 127659 |
| **Property and Equipment** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Flight property and equipment | 257280 | 260471 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ground property and equipment | 8858 | 8792 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less accumulated depreciation and amortization | (217938) | (193457) |
| **Net Property and Equipment** | 48200 | 75806 |
| **Other Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease right-of-use asset | 6233 | 10270 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangibles | 5300 | 5300 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term sales lease receivable, net | 1060 | 1171 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term investments | 4275 | 4275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term contract costs |  | 578 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term restricted investments | 3797 | 3194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | 7662 | 8051 |
| **Total Other Assets** | 28327 | 32839 |
| **Total Assets** | $204450 | $236304 |

---

*See accompanying notes to consolidated financial statements.*

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**Harbor Diversified, Inc. and Subsidiaries** 

**Consolidated Balance Sheets (in thousands, except share amounts and per share values)** <br>

---

| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| **Liabilities, Mezzanine Equity, and Stockholders' Equity** |  |  |
| **Current Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $13557 | $12385 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued payroll and employee benefits | 12415 | 11495 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current portion of operating lease liability | 2934 | 4938 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other accrued expenses | 61 | 67 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities, net | 4190 | 100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | 312 |  |
| **Total Current Liabilities** | 33469 | 28985 |
| **Other Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term promissory note | 4275 | 4275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liability | 557 | 1983 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term operating lease liability | 1237 | 3010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term contract liabilities, net |  | 2984 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term deferred compensation | 3823 | 3216 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | 2278 | 2007 |
| **Total Long-Term Liabilities** | 12170 | 17475 |
| **Commitments and Contingencies (Note 7)** |  |  |
| **Mezzanine Equity** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Series C Convertible Redeemable Preferred Stock, $0.01 par value, 4,000,000 shares authorized at December 31, 2024 and December 31, 2023, no shares and 4,000,000 issued and outstanding as of December 31, 2024 and December 31, 2023, respectively. |  | 13200 |
| **Stockholders' Equity** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common Stock, $0.01 par value, 100,000,000 shares authorized at December 31, 2024 and December 31, 2023, 71,981,140 and 55,481,140 shares issued at December 31, 2024 and December 31, 2023, respectively, and 58,493,761 and 43,126,355 shares outstanding at December 31, 2024 and December 31, 2023, respectively. | 720 | 555 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 285573 | 284340 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained deficit | (105894) | (88719) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury stock | (21588) | (19532) |
| **Total Stockholders' Equity** | 158811 | 176644 |
| **Total Liabilities, Mezzanine Equity, and Stockholders' Equity** | $204450 | $236304 |

---

*See accompanying notes to consolidated financial statements.* 

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**Harbor Diversified, Inc. and Subsidiaries** 

**Consolidated Statements of Operations (in thousands, except share amounts and per share values)** <br>

---

| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| **Operating Revenues** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract revenues | $202375 | $198833 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract services and other | 8 | 372 |
| **Total Operating Revenues** | 202383 | 199205 |
| **Operating Expenses** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payroll and related costs | 122102 | 121697 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aircraft fuel and oil | 340 | 517 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aircraft maintenance, materials and repairs | 58476 | 60783 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other rents | 6698 | 6210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation, amortization and obsolescence | 26051 | 25523 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchased services and other | 12919 | 21346 |
| **Total Operating Expenses** | 226586 | 236076 |
| **Loss From Operations** | (24203) | (36871) |
| **Other Income (Expense)** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest and dividend income | 4314 | 5476 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (9) | (15) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on marketable securities and long-term restricted investments | 1557 | 5870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on extinguishment of debt |  | 6204 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other, net | (8) | (14) |
| **Total Other Income** | 5854 | 17521 |
| **Net Loss Before Taxes** | (18349) | (19350) |
| **Income Tax Benefit** | (1174) | (3365) |
| **Net Loss** | (17175) | (15985) |
| Preferred stock dividends | 1092 | 1328 |
| **Net loss available to common stockholders** | $(18267) | $(17313) |
| Basic loss share | $(0.36) | $(0.39) |
| Diluted loss per share | $(0.36) | $(0.39) |
| Weighted average common shares: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic | 50738144 | 44043175 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted | 50738144 | 44043175 |

---

*See accompanying notes to consolidated financial statements.*

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**Harbor Diversified, Inc. and Subsidiaries** 

**Consolidated Statements of Stockholders' Equity (in thousands)** <br>

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | Mezzanine Equity -<br>Series C<br>Convertible<br>Redeemable<br>Preferred Stock | Mezzanine Equity -<br>Series C<br>Convertible<br>Redeemable<br>Preferred Stock | Common Stock | Common Stock | Common Stock | | | | |
| | Shares | Amount | Shares | Repurchased<br>Stock | Amount |<br>Additional<br>Paid-In<br>Capital |<br>Retained<br>Deficit |<br>Cost of<br>Repurchased<br>Stock |<br>Total<br>Stockholders'<br>Equity |
| Balance, December 31, 2022 | 4000 | $13200 | 45220 | 10261 | $555 | $285668 | $(72734) | $(14983) | $198506 |
| Net loss |  |  |  |  |  |  | (15985) |  | (15985) |
| Preferred stock dividends |  |  |  |  |  | (1328) |  |  | (1328) |
| Repurchased stock |  |  | (2094) | 2094 |  |  |  | (4549) | (4549) |
| Balance, December 31, 2023 | 4000 | $13200 | 43126 | 12355 | $555 | $284340 | $(88719) | $(19532) | $176644 |
| Net loss |  |  |  |  |  |  | (17175) |  | (17175) |
| Preferred stock dividends |  |  |  |  |  | (1092) |  |  | (1092) |
| Series C preferred stock conversion | (755) | (2490) | 16500 |  | 165 | 2325 |  |  | 2490 |
| Series C preferred stock redemption | (3245) | (10710) |  |  |  |  |  |  |  |
| Repurchased stock |  |  | (1132) | 1132 |  |  |  | (2056) | (2056) |
| Balance, December 31, 2024 |  | $— | 58494 | 13487 | $720 | $285573 | $(105894) | $(21588) | $158811 |

---

*See accompanying notes to consolidated financial statements*.

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**Harbor Diversified, Inc. and Subsidiaries** 

**Consolidated Statements of Cash Flows (in thousands)** <br>

---

| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| **Cash Flows from Operating Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(17175) | $(15985) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by (used in) operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation, amortization and obsolescence allowance | 26051 | 25523 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of engine overhauls | 3527 | 4202 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | (1426) | (3269) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on disposition of property and equipment | (648) | (523) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on marketable securities | (1015) | (3651) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on extinguishment of debt |  | (6204) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (1788) | 5636 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales lease receivable | 394 | 208 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Spare parts and supplies | (589) | (231) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other | 613 | 1843 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease right-of-use asset | 228 | 218 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 2510 | (7780) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued payroll and employee benefits | 920 | (1494) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other accrued expenses | (6) | (70) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | 312 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities | 1106 | 1099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues |  | (11601) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other long-term liabilities | 271 | 52 |
| **Net Cash Provided by (Used in) Operating Activities** | 13285 | (12027) |
| **Cash Flows from Investing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additions to property and equipment | (2900) | (4487) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds on disposition of property and equipment | 839 | 27 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of marketable securities | (9232) | (35132) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sale of marketable securities | 5954 | 99863 |
| **Net Cash (Used in) Provided by Investing Activities** | (5339) | 60271 |
| **Cash Flows from Financing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayments of long-term debt |  | (55018) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends paid on preferred stock | (1092) | (1328) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Series C stock redemption | (10710) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (2056) | (4549) |
| **Net Cash Used in Financing Activities** | (13858) | (60895) |
| **Decrease in Cash, Cash Equivalents and Restricted Cash** | (5912) | (12651) |
| **Cash, Cash Equivalents and Restricted Cash, beginning of year** | 21531 | 34182 |
| **Cash, Cash Equivalents and Restricted Cash, end of year** | $15619 | $21531 |

---

*See accompanying notes to consolidated financial statements.* 

*See Note 12 for supplemental cash flow information.* 

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**Harbor Diversified, Inc. and Subsidiaries** 

**Notes to Consolidated Financial Statements (in thousands, except share amounts and per share values)** <br>

**1. Summary of Significant Accounting Policies** 

***Basis of Presentation***

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") and include the accounts of Harbor Diversified, Inc. ("Harbor") and its subsidiaries (collectively, the "Company").

Harbor is a non-operating holding company that is the parent of a consolidated group of wholly-owned subsidiaries, including AWAC Aviation, Inc. ("AWAC"), which was the sole member of Air Wisconsin Airlines LLC ("Air Wisconsin"), which historically operated as a regional air carrier. Harbor is also the direct parent of three other subsidiaries: (1) Lotus Aviation Leasing, LLC ("Lotus"), which leased flight equipment to Air Wisconsin, (2) Air Wisconsin Funding LLC ("AWF"), which provided flight equipment financing to Air Wisconsin, and (3) Harbor Therapeutics, Inc. ("Therapeutics"), which is a non-operating entity with no material assets.

On January 9, 2026, Harbor completed the last in a series of transactions pursuant to which it disposed of all of its aviation assets, including its membership interests in Air Wisconsin (the completion of all such transactions, collectively, the "Aviation Disposition "). After giving effect to the Aviation Disposition, neither Harbor nor any of its remaining subsidiaries has any material operating assets or infrastructure to support an airline, provided that the Company did retain certain non-operating assets, which primarily relate to lease payments for a single aircraft, insurance claims, and state and federal tax refunds.

Harbor currently does not have any material operating assets, is not engaged in any operating business, and does not have any source of revenue from operations. For additional information, please refer to Note 15, *Subsequent Events.*

***Principles of Consolidation***

The consolidated financial statements include the accounts and transactions of Harbor and its wholly-owned subsidiaries. All inter-company accounts and transactions are eliminated in consolidation.

***Description of Operations***

During the periods presented in this Annual Report, the Company had principal lines of business focused on (1) providing regional and other air services through Air Wisconsin (airline business), (2) acquiring flight equipment for the purpose of leasing the equipment to Air Wisconsin, and (3) providing flight equipment financing to Air Wisconsin. Following the termination of the American capacity purchase agreement described below, Air Wisconsin no longer operated as a regional air carrier. Subsequent to the termination of the American capacity purchase agreement, Air Wisconsin explored other business strategies and the sale or lease of assets, ultimately culminating in the Aviation Disposition.

The airline business was operated entirely through Air Wisconsin. For the year ended December 31, 2024, Air Wisconsin provided scheduled passenger service for American Airlines, Inc. ("American") under a capacity purchase agreement (the "American capacity purchase agreement") which was entered into in August 2022. Prior to early June 2023, Air Wisconsin also provided scheduled passenger service for United Airlines, Inc. ("United") under a capacity purchase agreement (the "United capacity purchase agreement") which was entered into in February 2017 and which terminated in early June 2023. Air Wisconsin provided scheduled passenger service for American commencing in March 2023. As of December 31, 2024 Air Wisconsin had 45 aircraft in service for American. The American capacity purchase agreement terminated in April 2025.

Additionally, in the fourth quarter of 2024 Air Wisconsin also began offering on-demand charter service within the contiguous United States. Under this service, Air Wisconsin negotiated a fare for the charter operations with the customer. The performance obligation was met and revenue was recognized upon completion of the flight. For the year ended December 31, 2024, charter revenues of $2,187, were an insignificant portion of the Company's revenues, representing 1.1% of Contract revenues. As of December 31, 2024, the Company had no contract liability outstanding with respect to charter service and had $635 recorded as part of Accounts receivable, net on the consolidated balance sheet. There were no

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credit losses recorded with respect to the charter services during the year ended December 31, 2024, nor did the Company expect any such credit losses in the future since the expected revenues were provided in an escrow account prior to any such flights.

For additional information, please refer to Note 2, *Capacity Purchase Agreements with United and American*, and Note 15, *Subsequent Events*.

***Segment Reporting***

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker ("CODM"), who for the year ended December 31, 2024, was the President and Chief Executive Officer of Air Wisconsin, in deciding how to allocate resources and in assessing operating performance. Under Accounting Standards Codification Topic 280, *Segment Reporting*, for the year ended December 31, 2024, the Company has one reportable segment that is managed on a consolidated basis providing scheduled flight services for American under the American capacity purchase agreement and on-demand charter service within the contiguous United States and Canada.

Our CODM evaluated the Company's financial information and resources on a consolidated net loss basis. Significant expenses that are regularly provided to the CODM for the Company's one reportable segment are presented on the consolidated statements of operations and are included within the reported measure of consolidated Net loss. Additionally, the measure of segment assets is reported on the consolidated balance sheets as Total assets.

***Contract Revenues***

For the years ended December 31, 2024 and December 31, 2023, (i) approximately 98.9% and 63.8%, respectively, of the Company's operating revenues were derived from operations associated with the American capacity purchase agreement and (ii) approximately 0.0% and 36.0%, respectively, of the Company's operating revenues were derived from operations associated with the United capacity purchase agreement.

In performing an analysis of the American capacity purchase agreement and the United capacity purchase agreement within the framework of Accounting Standards Update ("ASU") No. 2016-02, *Leases* ("ASC 842") and Accounting Standards Codification Topic ("ASC") 606, *Revenue from Contracts with Customers* ("ASC 606"), the Company determined that a portion of the payments it received under the agreements that was designed to reimburse Air Wisconsin for use of a certain number of aircraft, which is referred to as "right of use," was considered lease revenue. All other revenue received by Air Wisconsin under the capacity purchase agreements was considered non-lease revenue. After consideration of the lease and non-lease components, within the context of ASC 842, the Company determined the non-lease component to be the predominant component of each capacity purchase agreement and elected a practical expedient to not separate the lease and non-lease components. Therefore, all compensation received by Air Wisconsin pursuant to the American capacity purchase agreement and the United capacity purchase agreement has been accounted for under ASC 606.

Because Air Wisconsin's flights were distinct services that had the same pattern of transfer to the customer, which were satisfied over time with the measure of progress for each flight deemed to be substantially the same, the flight services promised pursuant to the American capacity purchase agreement and the United capacity purchase agreement represented a series of services that were accounted for as a single performance obligation. Therefore, contract revenues were recognized when service was provided and the performance obligation was met on a per completed flight basis. The performance obligation of each completed flight was measured using departures.

The United capacity purchase agreement terminated in early June 2023 and no material contract revenues have been recorded under that agreement since then. In March 2023, Air Wisconsin commenced flying operations for American under

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the American capacity purchase agreement, at which time Air Wisconsin began recording contract revenues under that agreement.

In November 2024, Air Wisconsin and American entered into Amendment No. 4 ("Amendment No. 4") to the American capacity purchase agreement. Among other things, Amendment No. 4:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• resolved certain disputes with respect to the interpretations of American's payment obligations under the American capacity purchase agreement, including through the execution of a mutual release of certain contractual liabilities with respect to the agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• accelerated the right of each Air Wisconsin and American to terminate the American capacity purchase agreement for convenience and shorten the wind-down period in connection with any such termination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• modified certain termination rights and the right to withdraw aircraft from the American capacity purchase agreement, including by eliminating (i) each party's right to terminate the agreement due to a certain number of aircraft not being available to provide regional airline services for American, (ii) American's right to withdraw aircraft from the agreement due to Air Wisconsin's failure to maintain adequate on-time departures, and (iii) each party's right to terminate the agreement due to ongoing unsupported aircraft thereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• modified the calculation and timing of certain compensation-related payments, including compensation rates, bonus calculations, and bonus and rebate reconciliations between Air Wisconsin and American;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• modified the total number of hours that Air Wisconsin's flight crews could be scheduled to work from November 2024 through the end of the term of the agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• modified the total number of aircraft under the agreement for which Air Wisconsin received payment from October 2024 through the end of the term of the American capacity purchase agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• established certain incentive payments to be made by American to Air Wisconsin.

On January 3, 2025, American delivered notice to Air Wisconsin of its election to terminate the American capacity purchase agreement. The agreement terminated in April 2025 and contract revenues have not been recorded under that agreement since then.

Under the United capacity purchase agreement, Air Wisconsin was entitled to receive a fixed rate for each departure and block hour, and a fixed amount per covered aircraft per day, in each case subject to annual increases during the term of the agreement. Air Wisconsin's performance obligation was met and revenue was recognized over time, which was then reflected in contract revenues. The United capacity purchase agreement also provided for the reimbursement to Air Wisconsin of certain direct operating expenses, such as certain insurance premiums and property taxes. Air Wisconsin was also eligible to receive bonus compensation, or was required to pay penalties, based on the achievement, or failure to achieve, certain pre-established performance criteria.

Under the American capacity purchase agreement Air Wisconsin was entitled to receive certain payments based on the number of aircraft covered under the agreement, block hours, departures and certain performance metrics. The American capacity purchase agreement also provided for the reimbursement to Air Wisconsin of certain direct operating expenses, such as certain insurance premiums and property taxes. Air Wisconsin was also eligible to receive bonus compensation, and was required to pay rebates, upon the achievement of, or failure to achieve, certain pre-established performance criteria, subject to the changes in Amendment No. 4.

Under the United capacity purchase agreement, United made provisional cash payments to Air Wisconsin during each month of service based on projected flight schedules. These provisional cash payments were then subsequently reconciled with United based on actual completed flight activity. All payments through the termination of the United capacity purchase agreement were reconciled in 2023.

American made provisional cash payments to Air Wisconsin based on projected flight schedules. These provisional cash payments were subsequently reconciled with American based on actual completed flight activity. All payments through the termination of the American capacity purchase agreement were reconciled in 2025. As of December 31, 2024 and December 31, 2023, American owed Air Wisconsin $3,395 and $1,187, respectively, which is recorded in Receivables, net, in the consolidated balance sheets.

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Prior to the termination of the United capacity purchase agreement in early June 2023, Air Wisconsin was eligible to receive incentive payments, or was required to pay penalties, upon the achievement of, or failure to achieve, certain performance criteria primarily based on flight completion, on-time performance, and customer satisfaction ratings. At the end of each month during the term of the agreement, Air Wisconsin calculated the incentives achieved, or penalties payable, during that period and recognized revenue accordingly, subject to the variable constraint guidance under ASC 606. Final reconciliations were completed with United in 2023. Air Wisconsin received net payments of $1,419 for the year ended December 31, 2023. As of December 31, 2024 and December 31, 2023, Air Wisconsin had no amounts recorded as part of Receivables, net, in the consolidated balance sheets related to net incentive amounts from United.

Under the American capacity purchase agreement, as amended by Amendment No. 4, Air Wisconsin was eligible to receive bonus payments, and was required to pay rebates, upon the achievement of, or failure to achieve, certain performance criteria primarily based on flight completion, on-time performance, and customer satisfaction ratings. At the end of each month or quarter, Air Wisconsin calculated the bonus amounts achieved, or rebates payable, during that period and recognized revenue accordingly, subject to the variable constraint guidance under ASC 606. Air Wisconsin was not eligible for bonus payments, nor required to pay rebates, during the first six months of the American capacity purchase agreement in 2023. As of December 31, 2024, Air Wisconsin recorded $3,638 in incentive amounts under the American capacity purchase agreement. As of December 31, 2023, Air Wisconsin had recorded $267 in rebate amounts payable under the American capacity purchase agreement.

Under the United capacity purchase agreement, Air Wisconsin was entitled to receive a fixed amount per aircraft per day for each month during the term of the agreement. In accordance with GAAP, the Company recognized revenue related to the fixed payments on a proportional basis taking into account the number of flights actually completed in that period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. Air Wisconsin deferred fixed revenues between April 2020 and June 2021 due to the significant decrease in its completed flights as a result of the COVID-19 pandemic. Beginning in July 2021, due to an increase in completed flights and based on projected future completed flight activity, Air Wisconsin began reversing this deferral of fixed revenues, and it continued to do so until the termination of the agreement in early June 2023. Since the United capacity purchase agreement had terminated in early June 2023, Air Wisconsin did not recognize, after the termination, any fixed revenues under the agreement that had previously been deferred. Therefore, as of December 31, 2024 and December 31, 2023, there were no deferred fixed revenues related to the United capacity purchase agreement.

Under the United capacity purchase agreement, Air Wisconsin also recognized decreased non-refundable upfront fee revenues and increased fulfillment costs, both of which were amortized over the remaining term of the United capacity purchase agreement in proportion to the number of flights actually completed in that period relative to the number of flights expected to be completed in subsequent periods. Since the United capacity purchase agreement had terminated in early June 2023, Air Wisconsin did not recognize, after the termination, any revenue from upfront fees or fulfillment costs under the agreement. Therefore, as of December 31, 2024 and December 31, 2023, there were no deferred upfront fees or fulfillment costs related to the United capacity purchase agreement.

Under the American capacity purchase agreement, Air Wisconsin was entitled to receive from American a fixed daily amount for each aircraft covered under the agreement (subject to Air Wisconsin's ability to meet certain block hour utilization thresholds and Amendment No. 4). Because the fixed daily amounts for each aircraft covered under the agreement were specifically related to the performance obligation completed during the period, they were recognized in contract revenues in the period in which the applicable flights were completed. During the year ended December 31, 2024, Air Wisconsin recorded $81,619 of fixed daily revenues under the American capacity purchase agreement which are included as part of Contract revenues in the consolidated statements of operations, compared to $59,089 for the year ended December 31, 2023.

Under the American capacity purchase agreement, Air Wisconsin was also entitled to be reimbursed for certain startup costs ("non-refundable upfront fee revenue"), such as livery changes to the aircraft, to prepare the aircraft for American flight services that were recognized as non-refundable upfront fee revenue. Through December 31, 2024, Air Wisconsin had incurred $3,998 in reimbursable costs. As of December 31, 2023, Air Wisconsin had incurred $3,998 in reimbursable costs, and estimated that it would incur an additional $602 in reimbursable costs over the term of the American capacity purchase agreement. In accordance with GAAP, the Company recognized revenue related to the total estimated non-refundable upfront fee revenue of $3,998 and $4,600 for the years ended December 31, 2024 and December 31, 2023, respectively, on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. Accordingly, during the years ended December 31, 2024 and December 31, 2023, Air Wisconsin recognized $2,741 and $505 of non-refundable upfront fee revenues, respectively. As of December 31, 2024 and December 31, 2023, Air

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Wisconsin deferred $753, and $3,493, respectively, in non-refundable upfront fee revenues under the American capacity purchase agreement. Air Wisconsin's deferred revenues related to the non-refundable upfront fee revenues under the American capacity purchase agreement were adjusted over the remaining contract term, based on the actual expenses incurred that were reimbursed and recognized based on the number of flights actually completed in the period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. As of December 31, 2024 and December 31, 2023, deferred non-refundable upfront fee revenues in the amount of $753 and $662, respectively, were netted as part of Contract liabilities, net, and $— and $2,831, respectively, were recorded as part of Long-term contract liabilities, net in the consolidated balance sheets.

Under the American capacity purchase agreement, Air Wisconsin also received a monthly support fee and was reimbursed for heavy maintenance expenses based on the fixed covered per aircraft per day rate over the term of the agreement. In addition, amendments to the American capacity purchase agreement entered into in February 2023 and November 2023 ("Amendment No. 1" and "Amendment No. 3", respectively) provided for a one-time payment, as well as revised compensation rates, to assist Air Wisconsin with pilot compensation and retention. Amendment No. 4 provided payment for fixed number of aircraft through the term of the American capacity purchase agreement. In accordance with GAAP, the Company recognized revenue related to the monthly support fee, heavy maintenance revenue, and one-time pilot compensation assistance payment on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights that were expected to be completed in subsequent periods during the remaining term of the agreement. Accordingly, during the years ended December 31, 2024 and December 31, 2023, Air Wisconsin recognized $10,990 and $5,456, respectively, of revenue related to these amounts. As of December 31, 2024 and December 31, 2023, revenues related to the anticipated heavy maintenance reimbursements and one-time pilot compensation assistance payment in the amounts of $2,688 and $562 were netted as part of Contract liabilities, net, respectively. As of December 31, 2024 and December 31, 2023, revenues related to the monthly support fee in the amounts of $1 and $152 were netted as part of Contract liabilities, net, and Long-term contract liabilities, net, respectively. Air Wisconsin's Contract liabilities, net and Long-term contract liabilities, net related to the one-time pilot compensation assistance payment, estimated monthly support fee and heavy maintenance revenue adjusted over the remaining contract term, based on the actual reimbursement of the monthly support fee and heavy maintenance revenue and on the number of flights actually completed in each reporting period relative to the number of flights that were completed in subsequent periods during the remainder of the term of the agreement.

Under the American capacity purchase agreement, Air Wisconsin was eligible to receive a block hour minimum and fixed daily amount for aircraft when flying scheduled by American did not meet minimum thresholds based on Air Wisconsin's crew availability. Since the start of flying under the American capacity purchase agreement in March 2023, in all periods prior to the three months ended June 30, 2024, American had met such minimum thresholds and thus no minimum payments were received. Considering Amendment No. 4, during the twelve months ended December 31, 2024, Air Wisconsin received $9,508 related to the block hour and crew availability minimums. In accordance with GAAP, the Company recognized revenue related to the total block hour and crew availability minimums on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights that were expected to be completed in subsequent periods during the remaining term of the agreement. Accordingly, during the twelve months ended December 31, 2024, Air Wisconsin recognized $7,050 of revenues for block hour and crew availability minimums compared to $0 for the year ended December 31, 2023. As of December 31, 2024, revenues related to the block hour and crew availability minimums in the amount of $2,458 were netted as part of Contract liabilities, net in the consolidated balance sheets. As of December 31, 2023, there were no amounts recorded in contract assets or liabilities on the consolidated balance sheets related to block hour and crew availability minimums. Air Wisconsin's block hour and crew availability minimums that were netted as part of Contract liabilities, net on the consolidated balance sheets were adjusted over the remaining contract term, based on the actual revenues that were received and recognized based on the number of flights that were completed in the period relative to the number of flights that were expected to be completed in subsequent periods during the remainder of the term of the agreement.

While Amendment No. 4 and the termination of the American capacity purchase agreement brought clarity with respect to the amount of revenue to be received and the timing of the recognition under the American capacity purchase agreement of non-refundable upfront fee revenue, fulfillment costs, monthly support fee revenues, heavy check maintenance revenues, one-time support fee revenues and minimum block hour and crew availability revenues in periods subsequent to December 31, 2024, there continued to be uncertainty due to a number of factors, including the final estimated revenue amounts that were expected to be received and the number of flights actually completed in the period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. The amount of revenues recognized for the years ended December 31, 2024 and December 31, 2023 that were related to the United capacity purchase agreement and previously recorded as Contract liabilities, net were $0 and $1,985, respectively. During

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the years ended December 31, 2024 and December 31, 2023, there were $662 and $0, respectively, of revenues recognized that were previously recorded as Contract liabilities, net related to the American capacity purchase agreement.

***Other Revenues***

Other revenues primarily consist of the sales of parts to other airlines and aircraft lease payments. These other revenues are immaterial in all periods presented. The transaction price for these other revenues generally is fair market value.

***Cash and Cash Equivalents***

Money market funds and investments and deposits with an original maturity of three months or less when acquired are considered cash and cash equivalents.

***Restricted Cash***

As of December 31, 2024 and December 31, 2023, the Company had a restricted cash balance of $667 and $755, respectively. A portion of the balance secures a credit facility for the issuance of letters of credit guaranteeing the performance of Air Wisconsin's obligations under certain lease agreements, airport agreements and insurance policies. The obligations supported by these letters of credit remained with Air Wisconsin following the Aviation Disposition. The remaining portion is cash held for the repurchase of shares under Harbor's stock repurchase program. For additional information, please refer to Note 7, *Commitments and Contingencies*, and Note 14, *Stock Repurchase Program.*

***Receivables, net***

As of December 31, 2024 and December 31, 2023, the Company had a Receivables, net balance of $7,380 and $5,592, respectively. The table below sets forth the major categories that make up the balances:

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| | | |
|:---|:---|:---|
| | December 31, 2024 | December 31, 2023 |
| Trade receivables | $4030 | $1187 |
| Insurance and warranty claim receivables | 1985 | 1506 |
| Federal and state tax receivables | 680 | 1024 |
| Other industry related receivables | 690 | 1883 |
| Allowance for expected credit losses | (5) | (8) |
| Receivables, net | $7380 | $5592 |

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Other industry related receivables include employee receivables related to such items as uniforms and relocation expenses, transactions with our unions, and credits from vendors. The balance of trade receivables was $1,612 as of December 31, 2022.

***Allowance for Credit Losses***

The Company monitors publicly available credit ratings for entities for which the Company has a significant credit balance. The Company determined that its receivables for the year ended December 31, 2024 were primarily the result of its relationship with American (and its prior relationship with United), insurance-related receivables and income tax refunds. These receivables are payable by governmental entities or companies the Company believes to be credit-worthy. Accordingly, the Company has not recorded an allowance for credit losses related to these receivables.

The Company historically maintained, and continues to maintain, an allowance for expected credit losses primarily related to employee receivables. The allowance for expected credit losses was $5 and $8 as of December 31, 2024 and December 31, 2023, respectively. The Company will continue to monitor its financial instruments for expected credit losses.

In December 2023, Air Wisconsin entered into a sale-type lease for one of its aircraft. The resulting Sales lease receivable was evaluated under ASC 326 resulting in an allowance for credit losses of $333 and $229 for the years ended

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December 31, 2024 and December 31, 2023, respectively. For additional information, please refer to Note 6, *Sales-type Lease*.

***Marketable Securities and Long-term Restricted Investments (SESP)***

The Company's equity security investments, consisting of exchange-traded funds and mutual funds, are recorded at fair value based on quoted market prices (Level 1) in Marketable securities and Long-term restricted investments (SESP) in the consolidated balance sheets, in accordance with the guidance in Accounting Standards Codification Topic 321, *Investments-Equity Securities*, with the change in fair value during the period included in the consolidated statements of operations. For additional information, please refer to Note 1, *Fair Value of Financial Instruments*.

As of December 31, 2024 and December 31, 2023, the fair value of the Company's Marketable securities and Long-term restricted investments (SESP) were $100,815 and $95,941, respectively.

The calculation of net unrealized gains that relate to Marketable securities and Long-term restricted investments (SESP) held as of December 31, 2024 and December 31, 2023 is as follows:

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| | | |
|:---|:---|:---|
| | Year Ended <br>December 31, <br>2024 | Year Ended <br>December 31, <br>2023 |
| Net gains recognized during the period on equity securities | $1557 | $5870 |
| Less: Net gains (losses) recognized during the period on equity securities sold during the period |  |  |
| Unrealized gains recognized during the period on equity securities held as of the end of the period | $1557 | $5870 |

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The SESP was terminated on January 9, 2026, in connection with the Aviation Disposition.

***Spare Parts and Supplies***

Spare parts and supplies include an inventory of expendable parts and miscellaneous aircraft supplies stated at average cost less an obsolescence allowance. The Company provides for an allowance for obsolescence after considering a number of factors, including the useful life of the aircraft fleet, the estimated cost of expendable parts expected to be on hand at the end of the useful life and the estimated salvage value of the parts. This allowance is based on management estimates and is subject to change. Expendable parts are charged to expense at average cost when used. Expendable parts that are repairable are returned to inventory at the average cost of comparable parts, less a reserve for scrap. Supplies are stated at average cost. The inventory allowance was $17,120 and $17,146 as of December 31, 2024 and December 31, 2023, respectively.

The Company does, from time to time, consign certain of its spare parts and supplies to third parties for sale. Title of any such parts or supplies remains with the Company until a sale is made. To the extent the Company does consign any such spare parts and supplies, it is not material to its inventory. The Company views the net carrying value of any consigned spare parts and supplies to be $0 for all periods presented due to its obsolescence reserve.

***Contract Costs***

Contract costs arose from the incremental costs incurred by Air Wisconsin to fulfill its obligations under its capacity purchase agreements and included costs such as aircraft painting and aircraft reconfiguration. Contract costs were amortized under the respective capacity purchase agreement based on the completion of Air Wisconsin's performance obligation as measured by departures.

Air Wisconsin incurred certain contract costs ("fulfillment costs") prior to the start of flying operations for American on March 1, 2023. These costs included changes to the livery, fuel costs, and certain training expenses. The total fulfillment costs incurred as of both December 31, 2024 and December 31, 2023 were $774. The fulfillment costs incurred for the twelve months ended December 31, 2023 are included in Prepaid expenses and other in the Cash Flows from Operating Activities section in the consolidated statements of cash flows. These costs were amortized on a proportional basis taking into account the number of flights actually completed in the period relative to the number of flights expected to be completed in subsequent periods during the remaining term of the agreement. Those contract costs that were expected to be

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amortized over the next one-year period are included in Contract costs in the consolidated balance sheets while those contract costs that were expected to be amortized in periods beyond one-year are included in Long-term contract costs in the consolidated balance sheets.

For the years ended December 31, 2024 and December 31, 2023, Air Wisconsin recorded $544 and $85, respectively, of amortization expense related to fulfillment costs. The amortization of fulfillment costs is included in Depreciation, amortization, and obsolescence allowance in the Cash Flows from Operating Activities section in the consolidated statements of cash flows. As of December 31, 2024, Contract costs and Long-term contract costs were $146 and $—, respectively, in the consolidated balance sheets and incurred under the American capacity purchase agreement. As of December 31, 2023, Contract costs and Long-term contract costs were $111 and $578, respectively, in the consolidated balance sheets and incurred under the American capacity purchase agreement.

***Contract Assets and Liabilities***

Contract assets arose from revenue earned for services provided that were not yet billable to United or American as of the respective dates of the consolidated balance sheets. Contract liabilities arose from payments received in advance of services provided.

Contract assets and liabilities that were expected to be settled within the next one-year period were netted in the consolidated balance sheets and included in either Contract assets, net or Contract liabilities, net. Contract assets and liabilities that were expected to be settled more than a year in the future were netted and included in either Long-term contract assets, net or Long-term contract liabilities, net in the consolidated balance sheets. As of December 31, 2024, the Company recorded Contract liabilities, net of $4,190 and Long-term contract liabilities, net of $0 related to the American capacity purchase agreement. As of December 31, 2023, the Company recorded Contract liabilities, net of $100 and Long-term contract liabilities, net of $2,984 related to American capacity purchase agreement. Due to the termination of the American capacity purchase agreement in 2025, the Company expects to record the contract liabilities as of December 31, 2024 in contract revenues during the year ended December 31, 2025.

The table below sets forth the opening and closing balances of both current and non-current contract liabilities.

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| | | |
|:---|:---|:---|
| | Current | Non-current |
| Balance as of December 31, 2022<sup>(1)</sup> | $13586 | $— |
| Amounts received, excluding amounts recognized as revenue | 100 | 2984 |
| Revenues recognized included in opening contract balance<sup>(2)</sup> | (13586) |  |
| Balance as of December 31, 2023 | $100 | $2984 |
| Amounts received, excluding amounts recognized as revenue | 3756 | 242 |
| Revenues recognized included in opening contract balance | (662) | (2230) |
| Reclassification between current and non-current | 996 | (996) |
| Balance as of December 31, 2024 | $4190 | $— |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<sup>(1)</sup>Includes $11,601 classified on the balance sheet in Current Liabilities as Deferred revenues.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<sup>(2)</sup>Includes $11,601 classified on the balance sheet in Current Liabilities as Deferred revenues as of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;December 31, 2022.

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***Property and Equipment***

Property and equipment are stated at cost and depreciated over their useful lives to their estimated residual values using the straight-line method as follows:

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| | | |
|:---|:---|:---|
| **Assets** | **Depreciable Life** | **Current Residual Value** |
| Aircraft | 7 years | $50 |
| Rotable parts | 7 years | 10% |
| Spare engines | 7 years | $25 |
| Ground equipment | up to 10 years | 0% |
| Office equipment | up to 10 years | 0% |
| Leasehold improvements | Shorter of asset or lease life | 0% |

---

The table below sets forth the original cost of the Company's property and equipment and accumulated depreciation or amortization as of the dates presented. The table excludes construction in process of $3,980 and $3,983 for the years ended December 31, 2024 and December 31, 2023, respectively. Construction in process primarily relates to the cost of parts that are not capitalized until the parts are placed into service.

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| | | | | |
|:---|:---|:---|:---|:---|
| **For the years ended:** | December 31, 2024 | December 31, 2024 | December 31, 2023 | December 31, 2023 |
| **Assets** | Original<br>Cost | Accumulated<br>Depreciation/<br>Amortization | Original<br>Cost | Accumulated<br>Depreciation/<br>Amortization |
| Aircraft | $65480 | $55544 | $67459 | $48011 |
| Spare engines | 157997 | 135278 | 160694 | 119575 |
| Rotable parts | 29823 | 19223 | $28335 | 18512 |
| Ground equipment | 2953 | 2466 | 2912 | 2277 |
| Office equipment | 4782 | 4547 | 4757 | 4391 |
| Leasehold improvements | 1123 | 880 | 1123 | 691 |
|  | $262158 | $217938 | $265280 | $193457 |

---

As of December 31, 2024, Air Wisconsin owned 63 CRJ-200 regional jets. The Company operated its aircraft under a continuous inspection and maintenance program. Generally, the normal cost of recurring maintenance is expensed when incurred. However, the Company used the deferral method of accounting for Air Wisconsin's planned major maintenance activities for engines pursuant to which the capitalized engine overhaul costs were amortized over the estimated useful life measured in engine cycles remaining until the next scheduled major maintenance activity. Lotus' engine maintenance costs were expensed when incurred.

Depreciation expense during the year ended December 31, 2024 was $25,475, compared to $25,295 for the year ended December 31, 2023, and is included in Depreciation, amortization and obsolescence in the consolidated statements of operations. Gains from the disposals of fixed assets for the years ended December 31, 2024 and December 31, 2023 were $648 and $523, respectively, and are included in Purchased services and other in the consolidated statements of operations.

***Impairment of Long-Lived Assets and Indefinite-Lived Intangible Assets***

The Company evaluates long-lived assets and indefinite-lived intangible assets for potential impairment and records impairment losses when events and circumstances indicate the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amounts.

When considering whether an impairment of long-lived assets exists, the Company is required to group similar assets together at the lowest level for which identifiable cash flows for such assets are largely independent of the cash flows of other assets and liabilities. The Company determined that because there is only one operating segment, primarily one revenue contract, and one aircraft type, the asset group was at the enterprise level and as such, included an assessment of all assets and liabilities of the Company.

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The Company determined that the same indicators of impairment that existed during the year ended December 31, 2023 continued to exist with respect to its long-lived assets during the year ended December 31, 2024, requiring the Company to perform a quantitative test for impairment. The accounting guidance provides examples of events that may indicate a long-lived asset group may not be recoverable. The relevant examples include a significant adverse change in the extent or manner in which a long-lived asset is used, a significant adverse change in the business climate that could affect the value of a long-lived asset group, or a current period operating or cash flow loss. The Company determined these indicators of impairment continued to be applicable due to the operating losses incurred during the year ended December 31, 2024, and in combination with lower usage rates for the aircraft as a result of the pilot shortage. This resulted in lower block hours and lower cash flows generated by the long-lived assets, continuing the trends which existed as of December 31, 2023. Based on an analysis of the fair market value of its long-lived assets, the Company determined that an impairment charge was not required as of December 31, 2024. Although the Company continued to monitor the risks for impairment in light of the termination of the American capacity purchase agreement in April 2025, the subsequent sale of certain assets in 2025 and the Aviation Disposition provided further validation that an impairment charge is not necessary. For additional information, please refer to Note 15, *Subsequent Events*.

The Company further concluded that its indefinite lived intangible assets continue to be indefinite lived intangible assets as of December 31, 2024 and that its intangible assets should be evaluated as one unit of account for determining impairment. Although indicators of impairment existed as of December 31, 2024, with respect to the intangible assets, the Company concluded, based on a qualitative assessment weighing the positive and negative evidence, that the significant inputs used to determine the fair value of the indefinite-lived intangible assets were not materially changed as of December 31, 2024. As a result, the Company determined that the indefinite-lived intangible assets were not impaired as of December 31, 2024.

***Supplemental Executive Savings Plan ("SESP")***

The Company maintained the SESP for the benefit of certain executives. The SESP offered deferred compensation retirement benefits that would otherwise be subject to the compensation limits imposed by the Internal Revenue Code on Company contributions to the Air Wisconsin Airlines Savings Plan. At the end of each year, the Company accrued a long-term deferred compensation liability for contributions earned during that year that were contributed to the SESP in January of the successive year. Assets acquired within the plan were recorded as Long-term restricted investments (SESP) and an offsetting liability was recorded as Long-term deferred compensation (SESP) in the consolidated balance sheets. Any increases or decreases in plan assets due to changes in market value were recorded as a Gain on Marketable securities and Long-term restricted investments (SESP), with an offsetting entry made to Payroll and related costs in the consolidated statements of operations. This results in no impact on net loss before taxes. The values of Long-term restricted investments (SESP) and Long-term deferred compensation (SESP) liability associated with the SESP were adjusted quarterly to reflect changes in market value.

In January 2024, the Company made a contribution to the SESP in the amount of $22 compared to a contribution of $27 in January 2023. As of December 31, 2024 and December 31, 2023, the Company had accrued a contribution to the SESP in the amount of $26 and $22, respectively. For the years ended December 31, 2024 the Company recorded $541 in Gain (loss) on Marketable securities and Long-term restricted investments (SESP) and $44 of interest and dividend income, with an offsetting entry made to Payroll and related costs. As of December 31, 2024 and December 31, 2023, Long-term restricted investments (SESP) were $3,797 and $3,194, respectively, and Long-term deferred compensation (SESP) were $3,823 and $3,216, respectively, in the consolidated balance sheets. The value of assets and liabilities associated with the SESP was added to the consolidated financial statements as of December 31, 2023 and thus was not included in the comparative results for the year ended December 31, 2023. The SESP was terminated effective as of January 9, 2026, in connection with the Aviation Disposition. For additional information, please refer to Note 15, *Subsequent Events*.

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***Other Assets***

Other non-current assets consist of expected amounts to be received in future periods at least one-year beyond the respective dates of the consolidated balance sheets. Other assets is made up of the items presented in the table below.

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| | | |
|:---|:---|:---|
| **For the years ended:** | December 31, 2024 | December 31, 2023 |
| Expected state tax refunds from 2021 and 2022 amended returns | 253 | 231 |
| Expected federal refunds from 2021 and 2022 income tax returns to be amended | 6527 | 6786 |
| Workers compensation loss fund | 804 | 945 |
| Long-term deposits | 78 | 89 |
| Other assets | $7662 | $8051 |

---

***Interest and Dividend Income***

The Company records investment income earned on its Cash and cash equivalents, Marketable securities, and Long-term restricted investments (SESP) consisting primarily of interest and dividends, in Interest and dividend income in the consolidated statements of operations. For the year ended December 31, 2024, interest income amounted to $289, while dividend income amounted to $4,025. For the year ended December 31, 2023, interest income amounted to $160, while dividend income amounted to $5,316.

***Income Taxes***

The Company utilizes the asset and liability method for accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based upon the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities, as measured by the current applicable tax rates. Deferred tax expense represents the result of changes in deferred tax assets and liabilities. Determining whether deferred tax assets are realizable requires significant judgment, including but not limited to, forecasting the reversal of temporary differences. A valuation allowance is provided for those deferred tax assets for which the Company cannot conclude that it is more likely than not that such deferred tax assets will be realized. In determining the amount of any valuation allowance, in addition to the reversal of temporary differences, estimated future taxable income as well as feasible tax planning strategies for each taxing jurisdiction, are considered. Each fiscal quarter the Company reevaluates its tax provision and reconsiders the estimates and assumptions related to specific tax assets and liabilities, making adjustments as circumstances change.

As required by the uncertain tax position guidance, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company has applied the uncertain tax position guidance to all tax positions for which the statute of limitations remains open.

The Company is subject to federal, state and local income taxes in the United States. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require the application of significant judgment. The Company is no longer subject to U.S. federal income tax examinations for the years prior to 2021. With a few exceptions, the Company is no longer subject to state or local income tax examinations for years prior to 2020. As of December 31, 2024, the Company had no outstanding tax examinations.

The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense for all periods presented. The Company accrued $48 and $47 for the payment of interest and penalties at December 31, 2024 and December 31, 2023, respectively.

***Comprehensive Income***

The Company does not have any components of comprehensive income and, as of December 31, 2024 and December 31, 2023, comprehensive income was equal to net income reported in the consolidated statements of operations.

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***Concentration of Credit Risk and Customer Risk***

Financial instruments that potentially expose the Company to a concentration of credit risk consist principally of cash and cash equivalents that are held by financial institutions in the United States and accounts receivable. The Company at times has had bank deposits in excess of the Federal Deposit Insurance Corporation insurance limit. The Company maintains its cash accounts with high credit quality financial institutions and, accordingly, the Company believes it has minimal credit risk with respect to these financial institutions. As of December 31, 2024, in addition to cash and cash equivalents of $14,952, the Company had $667 in restricted cash, which related to a credit facility used for the issuance of cash collateralized letters of credit supporting Air Wisconsin's obligations under certain lease agreements, airport agreements and insurance policies, as well as cash held for the repurchase of shares under Harbor's stock repurchase program. Restricted cash includes amounts escrowed in an interest-bearing account that secures the credit facility. Air Wisconsin's obligations supported by these letters of credit remained with Air Wisconsin following the Aviation Disposition.

Air Wisconsin has historically faced considerable customer concentration of risk. Significant customers are those which represent more than 10% of the Company's total revenue or net accounts receivable balance at each respective balance sheet date. Air Wisconsin entered into the American capacity purchase agreement in August 2022 and commenced flying operations for American in March 2023. American became Air Wisconsin's sole airline partner once all aircraft were removed from United's flying operations in early June 2023, at which point substantially all of the Company's revenues were derived from the American capacity purchase agreement. Approximately 98.9% of the Company's consolidated revenues for the year ended December 31, 2024 were derived from the American capacity purchase agreement compared to approximately 63.8% for the year ended December 31, 2023. As of December 31, 2024 approximately 46.0% of the Receivables, net balance in the consolidated balance sheets was derived from the American capacity purchase agreement compared to 21.2% as of December 31, 2023. The American capacity purchase agreement terminated effective April 3, 2025.

While no revenues were received as a result of the United capacity purchase agreement for the year ended December 31, 2024 due to its termination in June 2023, approximately 36.0% of the Company's consolidated revenues for the year ended December 31, 2023 were derived from the United capacity purchase agreement. As of December 31, 2024 and December 31, 2023, there were no outstanding amounts in Receivables, net in the consolidated balance sheet related to the United capacity purchase agreement, which terminated in early June 2023.

Neither American's nor United's obligations to pay Air Wisconsin the amounts required to be paid under the applicable capacity purchase agreement were collateralized.

For additional information, please refer to Note 2, *Capacity Purchase Agreements with United and American*.

***Estimates and Assumptions***

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to revenue recognition, long-lived assets, and income taxes.

Management evaluates its estimates and assumptions on an ongoing basis using historical experience, existing and

known circumstances, authoritative accounting guidance, and other factors it believes to be reasonable, including an assessment of current and anticipated future macroeconomic conditions, and makes adjustments when facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements. To the extent there are differences between these estimated and actual results, it may result in material effects on the Company's financial condition, results of operations and liquidity.

***Fair Value of Financial Instruments***

The Company's financial instruments include Cash and cash equivalents, Restricted cash, Marketable securities, Long-term restricted investments (SESP), Receivables, net, Long-term investments, Accounts payable, and Long-term promissory note. The Company believes the carrying amounts of these financial instruments, with the exception of Marketable securities and Long-term restricted investments (SESP), are a reasonable estimate of their fair value because of the short-term nature of such instruments, or, in the case of the Long-term promissory note, because the Company also holds the promissory note evidencing such obligation, which is reflected in Long-term investments on the consolidated balance sheets. Marketable securities and Long-term restricted investments (SESP) are reported at fair value based on quoted

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market prices. Long-term investments are held-to-maturity debt securities and are reported at amortized cost. For additional information regarding the Long-term promissory note and Long-term investments, please refer to Note 4, *Debt*.

Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date, which is otherwise referred to as an exit price. Accounting Standards Codification Topic 820, *Fair Value Measurement* ("ASC 820") establishes a three-tier fair value hierarchy, which prioritizes inputs used in fair value. The tiers are as follows:

Level 1 - Quoted market prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable.

Level 3 - Unobservable inputs developed using the Company's estimates and assumptions, which reflect those that market participants would use.

The determination of where an asset or liability falls in the hierarchy requires significant judgment. The Company evaluates these determinations each reporting period, and it is possible that an asset or liability may be classified differently from year to year.

The tables below set forth the Company's classification of Marketable securities, Long-term investments and Long-term restricted investments (SESP) as of the dates presented:

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2024 | December 31, 2024 | December 31, 2024 | December 31, 2024 |
| | Total | Level 1 | Level 2 | Level 3 |
| Marketable securities – exchange-traded funds | $87629 | $87629 | $— | $— |
| Marketable securities – mutual funds | 9389 | 9389 |  |  |
| Long-term investments – bonds (see Note 7) | 4275 |  | 4275 |  |
| Long-term restricted investments - mutual funds | 3797 | 3797 |  |  |
| Total | $105090 | $100815 | $4275 | $— |

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| | | | | |
|:---|:---|:---|:---|:---|
| | December 31, 2023 | December 31, 2023 | December 31, 2023 | December 31, 2023 |
| | Total | Level 1 | Level 2 | Level 3 |
| Marketable securities – exchange-traded funds | $83826 | $83826 | $— | $— |
| Marketable securities – mutual funds | 8921 | 8921 |  |  |
| Long-term investments – bonds (see Note 7) | 4275 |  | 4275 |  |
| Long-term restricted investments - mutual funds | 3194 | 3194 |  |  |
| Total | $100216 | $95941 | $4275 | $— |

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***Recently Adopted Accounting Pronouncement***

On January 1, 2024 the Company adopted the updates to ASU No. 2023-07, *Segment Reporting (ASC Topic 280) – Improvements to Reportable Segment Disclosures*. These updates are intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, with the intention of enabling users of the financial statements to better understand the entity's measurement and assessment of segment performance and resource allocation. Upon adoption the guidance was applied retrospectively to all periods presented. The adoption of this standard did not have an impact on the Company's consolidated financial statements.

***Upcoming Accounting Pronouncements***

In December 2023, the FASB issued ASU No. 2023-09, *Income Taxes (ASC Topic740) – Improvements to Income Tax Disclosures* ("ASC 740"), which is intended to enhance the transparency, effectiveness and comparability of income tax

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disclosures by requiring consistent categories and greater disaggregation of information related to income tax rate reconciliations and the jurisdictions in which income taxes are paid. The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted. While the Company does not expect to adopt the accounting standard early, it continues to evaluate the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures. The Company does expect expanded disclosures in the future in response to this guidance.

In March 2024, the FASB issued ASU No. 2024-03, *Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (ASC Subtopic 220-40) – Disaggregation of Income Statement Expenses*, which enhances the transparency and comparability of financial statements by requiring companies to disclose more granular information about expense components. As clarified in ASU 2025-01, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the effective date*, the guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

**2.&nbsp;&nbsp;&nbsp;&nbsp;Capacity Purchase Agreements with United and American** 

In February 2017, Air Wisconsin entered into the United capacity purchase agreement. That agreement terminated and Air Wisconsin ceased flying for United in early June 2023. Prior to its termination, a dispute arose under the United capacity purchase agreement. Air Wisconsin claimed that United owed it certain amounts under the capacity purchase agreement. United denied that it owed those amounts and claimed that Air Wisconsin improperly terminated the agreement and that Air Wisconsin owed it certain amounts for the alleged wrongful termination. In October 2022, United initiated arbitration under the agreement. The arbitrators issued the United Arbitration Award in February 2024. The arbitrators denied Air Wisconsin's claims that United owed it amounts under the United capacity purchase agreement, and they denied United's claim that Air Wisconsin breached the agreement by terminating it and its claim that Air Wisconsin owed it damages for the alleged wrongful termination. As a result, neither party owed to the other party any amounts claimed in the arbitration.

In August 2022, Air Wisconsin entered into the American capacity purchase agreement, pursuant to which Air Wisconsin agreed to provide up to 60 CRJ-200 regional jet aircraft for regional airline services for American. Air Wisconsin commenced flying operations for American in March 2023. American became Air Wisconsin's sole airline partner when the last remaining aircraft covered by the United capacity purchase agreement were removed from United's flying operations in early June 2023. In February 2023 and November 2023, American and Air Wisconsin entered into Amendment No. 1 and Amendment No. 3, respectively, to the American capacity purchase agreement which, among other things, amended (i) the schedule of certain pass-through costs; (ii) the calculation and timing of certain compensation-related payments; (iii) the compensation rates and bonus and rebate reconciliation; and (iv) the period and payment of a fixed amount from American to Air Wisconsin for pilot compensation and retention. In November 2024, American and Air Wisconsin entered into Amendment No. 4 to the American capacity purchase agreement which, among other things (i) resolved certain disputes with respect to the interpretation of American's payment obligations under the American capacity purchase agreement, (ii) accelerated the right of Air Wisconsin and American to terminate the American capacity purchase agreement for convenience, (iii) modified the way in which compensation rates and bonus and rebate reconciliations are made, (iv) modified the total number of aircraft and total number of hours for which Air Wisconsin received payment, and (v) provided for certain incentive payments made by American to Air Wisconsin. For additional information, please refer to Note 1, *Summary of Significant Accounting Policies—Contract Revenues*.

On April 3, 2025. the American capacity purchase agreement terminated, and all remaining Air Wisconsin aircraft covered by that agreement were withdrawn from service under the agreement.

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**3.&nbsp;&nbsp;&nbsp;&nbsp;Income Taxes** 

The income tax provision consists of the following:

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| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| Current Expense (Benefit) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal | $255 | $11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State | (3) | (107) |
| Total Current Expense (Benefit) | 252 | (96) |
| Deferred Benefit |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal | (1278) | (3831) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State | (148) | 562 |
| Total Deferred Benefit | (1426) | (3269) |
| Income Tax Benefit | $(1174) | $(3365) |

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The following is a reconciliation between a federal income tax rate of 21% and the effective tax rate which is derived by dividing the (benefit) provision for income taxes by the income before the (benefit) provision for income taxes:

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| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| Computed provision for income taxes at the statutory rate | $(3853) | $(4064) |
| Increase (decrease) in income taxes resulting from: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State income tax provision, net of federal income tax benefit | (520) | (714) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-deductible expenses | 158 | 183 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance changes affecting the provision for income taxes | 3034 | 1428 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Return to provision adjustments | 5 | (16) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other, net | 2 | (182) |
| Benefit for income taxes | $(1174) | $(3365) |

---

Deferred tax assets and liabilities reflect temporary differences between financial and tax reporting. As of December 31, 2024 and December 31, 2023, the Company's deferred tax assets were primarily the result of federal and state net operating losses, accruals, and reserves that had not yet been deducted in determining taxable income. As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. As of December 31, 2024 and December 31, 2023, management determined that the available negative evidence outweighed the available positive evidence leading management to conclude that it was more likely than not that some deferred tax assets that were ordinary in nature would not be realizable. As of December 31, 2024 and December 31, 2023, the Company recorded a valuation allowance of $6,011 and $2,278, respectively, against deferred tax assets that are ordinary in nature. The valuation allowance is primarily associated with federal and state net operating losses.

For the year ended December 31, 2024, the Company recorded a valuation allowance of $827 against deferred tax assets that are capital in nature and consist of an unrealized loss on investments. For the year ended December 31, 2023, the Company recorded a valuation allowance of $1,525 against deferred tax assets that are capital in nature and consist of an unrealized loss on investments and capital loss carryovers. As of December 31, 2024 and December 31, 2023, the Company sustained three years of cumulative pretax capital losses. In addition, management considered other positive and negative evidence when assessing whether a valuation allowance was necessary against deferred tax assets that were capital in nature. The negative evidence outweighed the positive evidence, leading management to conclude that a valuation allowance was necessary as of December 31, 2024 and December 31, 2023.

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Significant components of deferred tax assets and liabilities are as follows:

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| | | |
|:---|:---|:---|
| *Year ended December 31,* | 2024 | 2023 |
| **Deferred Tax Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accruals and reserves not currently deductible | $4048 | $4164 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal NOL carryover | 5363 | 6652 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State NOL carryovers | 1525 | 1691 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital loss carryover |  | 32 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued and deferred compensation | 3190 | 2308 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid items | 352 | 596 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liability | 399 | 412 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liability | 144 | 681 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues | 816 | 37 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized loss on investments | 827 | 1494 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | 945 | 718 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal before valuation allowance | 17609 | 18785 |
| Less: valuation allowance: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance - ordinary deferred tax assets | (6011) | (2278) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance - capital deferred tax assets | (827) | (1525) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total valuation allowance | (6838) | (3803) |
| Total Deferred Tax Assets | 10771 | 14982 |
| **Deferred Tax Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment | (10435) | (15858) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Right-of-use asset | (887) | (963) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other | (6) | (144) |
| **Total Deferred Tax Liabilities** | (11328) | (16965) |
| **Net Deferred Income Tax Liabilities** | $(557) | $(1983) |

---

At December 31, 2024 and December 31, 2023, the Company had federal net operating losses of approximately $25,540 and $31,649, respectively, and state net operating losses of approximately $26,036 and $28,701, respectively. As of December 31, 2024, the estimated effective tax rate applicable to the federal and state net operating losses was 21.0% and 5.8%, respectively. As of December 31, 2023, the estimated effective tax rate applicable to the federal and state net operating losses was 21.0% and 5.9%, respectively. Federal net operating losses are not subject to an expiration date but are subject to an 80% of taxable income limitation, while the Company expects the state net operating losses to begin to expire in 2032. State net operating losses differ with respect to expiration dates and limitations dependent on state specific regulations. The Company has no ongoing federal or state examinations. The Company is no longer subject to U.S. federal income tax examinations for years prior to 2021. With a few exceptions, the Company is no longer subject to state or local income tax examinations for the years prior to 2020.

With the exception of two states requiring the processing of the amended federal return before the filing of the amended state return, the Company amended the 2021 and 2022 federal and state income tax returns as a result of the United Arbitration Award. The 2021 amended income tax returns are expected to result in federal and state income tax refunds of approximately $290 and $47, respectively. The 2022 amended income tax returns are expected to result in federal and state income tax refunds of approximately $6,496 and $601, respectively. The expected 2021 federal income tax refund is shown in Receivables, net as of December 31, 2024, and in Other (long-term assets) as of December 31, 2023. The expected 2022 federal income tax refund is shown in Other (long-term assets) in the consolidated balance sheets for the years ended December 31, 2024 and December 31, 2023. As of December 31, 2024, the Company has received $8 and $48 of refunds related to the 2021 and 2022, respectively, amended state income tax returns. As of December 31, 2024, state income tax refunds from the 2022 and 2021 amended income tax returns yet to be received were recorded in Receivables, net in the amount of $340 and Other (long-term assets) in the amount of $253 in the consolidated balance sheets. As of December 31, 2023, state income tax refunds related to the 2022 and 2021 amended income tax returns yet to be received were recorded in Receivables, net in the amount of $412 and Other (long-term assets) in the amount of $231 in the consolidated balance

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sheets. The filing of the 2022 amended income tax return also resulted in a federal net operating loss of $14,887, and various state net operating losses totaling approximately $14,200. These net operating losses are included in the amounts referenced in the above paragraph.

Under ASC 740, the accounting guidance related to uncertain tax positions requires that the impact of a tax position be recognized in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2024 and December 31, 2023 is as follows:

---

| | | |
|:---|:---|:---|
| *December 31,* | 2024 | 2023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrecognized tax benefits at the beginning of the year | $47 | $123 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross increases – current year tax provisions | 1 | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross decreases – settlements with taxing authorities |  | (87) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrecognized tax benefits at the end of the year | $48 | $47 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest and penalties in year-end balance | $48 | $47 |

---

**4.&nbsp;&nbsp;&nbsp;&nbsp;Debt** 

***Aircraft Notes***

In December 2018, Air Wisconsin entered into a debt restructuring agreement with a lender, which held certain senior aircraft notes and subordinated aircraft notes. The senior aircraft notes were exchanged for notes in an aggregate principal amount of $70,000 ("Aircraft Notes") and the principal and accrued interest on the subordinated aircraft notes were forgiven and deemed paid in full. In December 2023, Air Wisconsin prepaid at a discount the entire outstanding principal balance of the Aircraft Notes together with all accrued interest. As a result of the prepayment, as of December 31, 2024 and December 31, 2023, Air Wisconsin no longer had any debt outstanding or debt service obligations, the liens and security interests securing the Aircraft Notes were released, and it ceased being subject to the restrictive covenants contained in the credit agreements.

***Long-Term Promissory Note***

In July 2003, Air Wisconsin financed a hangar through the issuance of $4,275 City of Milwaukee, Wisconsin variable rate Industrial Development Bonds. The bonds mature November 1, 2033. Prior to May 1, 2006, the bonds were secured by a guaranteed investment contract, which was collateralized with cash, and interest was payable semi-annually on each May 1 and November 1. In May 2006, Air Wisconsin acquired the bonds using the cash collateral. The bonds are reported as Long-term investments in the consolidated balance sheets. The hangar is accounted for as a right-of-use asset with a value of $2,084 and $2,315 as of December 31, 2024 and December 31, 2023, respectively.

**5.&nbsp;&nbsp;&nbsp;&nbsp;Lease Obligations** 

The Company reviewed all contracts and service agreements in effect in 2024 for criteria meeting the definition of a lease within the frameworks of ASC 842 and ASC 606. Those that were determined to be a lease may contain both a lease and a non-lease component. The Company elected as an accounting policy to not separate lease and non-lease components for major moveable equipment, as well as for building and commercial property leases. For all other underlying classes of assets, the Company identified the separate lease and non-lease components within the contract. If the Company could benefit from the underlying asset individually or in conjunction with other readily available goods and resources and the asset was not highly dependent upon nor highly interrelated with another underlying asset covered by the contract, the Company considered the underlying asset to be a separate lease component. In those instances where the Company identified a separate lease and non-lease component, consideration in the contract is allocated to the components based on their standalone selling prices. If standalone selling prices were not available, the Company estimated those prices, maximizing the use of observable information.

The Company's operating lease activities are recorded in Operating lease right-of-use assets, Current portion of operating lease liability, and Long-term operating lease liability in the consolidated balance sheets. The creation of a right-of-use asset on the consolidated balance sheets is often offset by the creation of a lease liability, resulting in a non-cash transaction. Air Wisconsin had operating leases with terms greater than twelve months for training simulators and facility

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space including office space and maintenance facilities. The remaining lease terms for training simulators and facility space varied from three months to nine years. For all leases with terms of 12 months or less, the Company elected as an accounting policy a short-term lease exception for all leases, regardless of the underlying class of asset, that allows the lessee to not recognize a lease right-of-use asset or lease liability. As a result, the Company recognized lease payments for short-term leases as an expense on a straight-line basis over the lease term. For leases with terms longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of the lease payments over the lease term. The Company used Air Wisconsin's incremental borrowing rate to discount the lease payments based on information available at lease inception. Air Wisconsin's operating leases with lease rates that were variable based on operating costs, use of the facilities, or other variable factors were excluded from the Company's right-of-use assets and operating lease liabilities in accordance with the applicable accounting guidance. The variable amounts were paid as invoiced according to the terms of the respective leases. Leasehold improvements were capitalized at cost and amortized over the lesser of their expected useful life or the lease term.

Certain leases contained an option to extend or terminate the lease agreement. The Company evaluated each option prior to its expiration and may or may not exercise such option depending on conditions present at the time. At the inception of the lease, if it was reasonably certain that the Company would exercise an option to extend or terminate a lease, the Company considered the option in determining the classification and measurement of the lease. As of December 31, 2024, the Company expected that in the normal course of business operating leases that were going to expire, would be renewed or be replaced by other leases.

As of December 31, 2024, Operating lease right-of-use assets were $6,233, Current portion of Operating lease liabilities was $2,934, and Long-term operating lease liabilities were $1,237. During the years ended December 31, 2024 and December 31, 2023, the Company entered into operating leases that resulted in right-of-use assets in the amounts of $1,493 and $2,172, respectively. During the years ended December 31, 2024 and December 31, 2023, the Company paid $5,639 and $5,701, respectively, in operating lease payments, which are reflected as a reduction to operating cash flows. For additional information, please refer to Note 12, *Supplemental Cash Flow Information*.

The table below presents operating lease related terms and incremental borrowing rates as of December 31, 2024:

---

| | |
|:---|:---|
| Weighted-average remaining lease term | 2.50 years |
| Weighted-average discount rate | 6.98% |

---

Components of lease costs were as follows for the years ended December 31,

---

| | | |
|:---|:---|:---|
| | 2024 | 2023 |
| Operating lease costs | $5849 | $5842 |
| Short-term lease costs | 304 | 319 |
| Variable lease costs | 545 | 49 |
| **Total Lease Costs** | $6698 | $6210 |

---

During the years ended December 31, 2024 and December 31, 2023, Air Wisconsin leased or subleased certain training simulators and facilities for terms of greater than 12 months. Certain leases are subject to non-cancellable lease terms or may include variable rate increases tied to the consumer price index. One of Air Wisconsin's leases required Air Wisconsin to reimburse the lessor for Air Wisconsin's pro-rata share of taxes and other operating expenses applicable to the leased property. Rent expense recorded under all operating leases, inclusive of engine leases, was $6,698 and $6,210 for the years ended December 31, 2024 and December 31, 2023, respectively.

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The following table summarizes the future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms greater than twelve months as of December 31, 2024:

---

| | |
|:---|:---|
| *Fiscal Year* | Amount |
| 2025 | $3125 |
| 2026 | 572 |
| 2027 | 392 |
| 2028 | 148 |
| 2029 | 79 |
| Thereafter | 239 |
| Total lease payments | 4555 |
| Less imputed interest | (384) |
| **Total Lease Liabilities** | $4171 |

---

Following the Aviation Disposition, all operating leases held by Air Wisconsin remained with Air Wisconsin, and the Company does not have any material operating leases, with the exception of a single lease for office space located in Appleton WI.

**6.&nbsp;&nbsp;&nbsp;&nbsp;Sales-type Lease**

In December 2023, Air Wisconsin entered into a sales-type lease for one of its aircraft that was previously treated as an operating lease since September 2022. The term of that lease is 36 months, with monthly payments of $64 that commenced in December 2023 and end in November 2026. If the lessee is not in default at the end of the lease term, the lessee may purchase the aircraft for a minimal amount at that time. Air Wisconsin has not provided a residual value guarantee as part of that lease.

The ASU No. 2016-13, *Financial Instruments- Credit Losses: Measurement of Credit Losses on Financial Instruments* ("ASC 326") requires assessment of the net investment in the lease as of the commencement date. Based on the expected payments due under the sales-type lease, and using an implicit rate of 12.6%, Air Wisconsin determined the initial net investment in the lease to be $2,132 The Company monitors publicly available information regarding the credit worthiness of the non-U.S. governmental agency in custody of the aircraft and the aircraft serves as collateral for the lease. Management determined that a credit loss reserve of $333 and $229 was appropriate under ASC 326 as of December 31, 2024 and December 31, 2023, respectively. The change in the credit loss reserve for the year ended December 31, 2024 of $104 over the previous year, reflects changes in the publicly available creditworthiness of the non-U.S. governmental agency in custody of the aircraft. Management also added $19 and $21 of interest accrued to the carrying value of the sales lease receivable under the sales-type lease as of December 31, 2024 and December 31, 2023, respectively. The net sales-lease receivable was $1,530 and $1,924 as of December 31, 2024 and December 31, 2023, respectively. As of December 31, 2024 and December 31, 2023, the net investment in the lease, net of the credit loss reserves, are labeled as Sales lease receivable, net in the consolidated balance sheets as $470 and $753, respectively, which reflects the amount expected to be received over the next one-year period, and $1,060 and $1,171, respectively, for Long-term sales receivable, net, which reflects the remaining amounts to be collected over the remaining term of the lease as of the respective dates of the consolidated balance sheets. For the years ended December 31, 2024 and December 31, 2023, the Company recorded $256 and $21, respectively, of interest income from the lease which is recorded in Interest and dividend income in the consolidated statements of operations.

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Undiscounted cash flows expected over the remaining term of the sales-type lease as of December 31, 2024 were as follows:

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| | |
|:---|:---|
| *Fiscal year* | Amount |
| 2025 | $773 |
| 2026 | 1348 |
| Total expected cash flows | 2121 |
| Interest income | (258) |
| Total sales lease receivable | 1863 |
| Less credit loss reserve | 333 |
| Total sales lease receivable, net | $1530 |

---

As of December 31, 2024, Air Wisconsin did not have any other assets with respect to which it was the lessor. Following the Aviation Disposition, the Company retains its right and interest in both the aircraft and lease, including any revenues derived therefrom. As of the date of filing of this Annual Report, the lessee is in default of the lease for non-payment of its lease obligation.

**7.&nbsp;&nbsp;&nbsp;&nbsp;Commitments and Contingencies** 

***Legal Proceedings***

From time to time, the Company is involved in various legal proceedings, regulatory matters, and other disputes or claims arising from or related to claims incident to the normal course of the Company's business activities, including with respect to intellectual property, employment, regulatory and contractual matters. Although the results of such legal proceedings, regulatory matters and other disputes and claims cannot be predicted with certainty, as of December 31, 2024, the Company believed that it was not a party to any legal proceedings, regulatory matters, or other disputes or claims for which a material loss is considered probable and for which the amount (or range) of loss was reasonably estimable. However, regardless of the merit of the matters raised or the ultimate outcome, legal proceedings, regulatory matters, and other disputes and claims may have an adverse impact on the Company as a result of adverse determinations, defense and settlement costs, diversion of management's time and resources, and other factors.

Prior to its termination, a dispute arose under the United capacity purchase agreement which was resolved by arbitration and the issuance of the United Arbitration Award in February 2024. The arbitrators denied Air Wisconsin's claims that United owed it amounts under the United capacity purchase agreement and denied United's claims that Air Wisconsin breached the agreement by terminating it and that Air Wisconsin owed it damages. As a result, neither party owed to the other party any amounts claimed in the arbitration. For additional information, please refer to Part I, Item 1, *Business*, in this Annual Report.

The Company and certain of its officers and directors were named as defendants in several lawsuits relating to facts arising in connection with the restatement of its previously issued consolidated financial statement for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023. One of those matters was a consolidated putative class action complaint captioned Toft v. Harbor Diversified, Inc., et al., No. 24-C-556 (E.D. Wisc. 2024) (the "Class Action"). On January 31, 2025, the court dismissed the operative complaint for failure to state a claim upon which relief could be granted. Defendants subsequently moved for sanctions under Rule 11 of the Federal Rules of Civil Procedure against the plaintiffs and their law firms, including the Rosen Law Firm. On December 3, 2025, the court granted the motion for sanctions with respect to the Rosen Law Firm, finding that its complaint against the Company was frivolous, and entered judgment in favor of the defendants. The court will now determine the amount of attorneys' fees and costs to which the Company and certain of its officers are entitled based on the Rule 11 violations found by the court.

In 2024, three stockholders each filed a stockholder derivative action against certain officers and directors of the Company alleging breach of fiduciary duty, among other claims, arising from allegations substantively similar to those raised in the Class Action. Two of those actions were consolidated in an action captioned *In re Harbor Diversified, Inc. Shareholder Derivative Litigation*, No. 24-C-903 (E.D. Wisc. 2024), and the other action is captioned *Cooke v. Bartlett et. al*., No. 24-934-MN (D. Del. 2024). Neither action substantively moved forward while the parties awaited a decision on the motion to dismiss in the Class Action. Following the dismissal of the Class Action, on March 12, 2026, the court entered a

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dismissal without prejudice in the Wisconsin consolidated action pursuant to the stipulation of the parties. The plaintiff in the Delaware action filed a notice of dismissal on March 25, 2026.

***Treasury Payroll Support Program Audit***

In April 2020, Air Wisconsin entered into a Payroll Support Program Agreement ("PSP-1 Agreement") with respect to payroll support from the U.S. Department of Treasury ("Treasury") under a program provided by the Coronavirus Aid, Relief, and Economic Security Act, pursuant to which Air Wisconsin received approximately $42,185 ("PSP-1"). In September 2020, the Treasury's Office of Inspector General ("OIG") commenced a routine audit in connection with Air Wisconsin's receipt of funds under the PSP-1 Agreement. In August 2025, Air Wisconsin received draft comments from the OIG. The OIG determined that Air Wisconsin overstated its awardable amount on its PSP-1 application. Air Wisconsin provided a response that acknowledged the overstatement but provided that the overstatement was corrected with its PSP-1 recertification submitted with its PSP-2 application. Air Wisconsin also indicated it may be due additional funds under PSP-2; however, Air Wisconsin does not believe that it will be required to repay any amount to the Treasury or that it will receive any further funds under the program. Air Wisconsin received communication in November 2025 from the OIG that it was still processing its final comments.

***Standby Letters of Credit***

As of December 31, 2024, Air Wisconsin had five outstanding letters of credit in the aggregate amount of $253 to guarantee the performance of its obligations under certain lease agreements, airport agreements and insurance policies. As of December 31, 2024, Air Wisconsin maintained a credit facility with a borrowing capacity of $333 for the issuance of such letters of credit as needed to support its operations. A significant portion of Air Wisconsin's restricted cash balance secures the credit facility. The obligations supported by these letters of credit remained with Air Wisconsin following the Aviation Disposition.

***Cash Obligations***

As the Company no longer had any outstanding debt as of December 31, 2024, the Company's cash obligations as of that date were primarily its operating lease obligations as outlined in Note 5, *Lease Obligations.*

As of December 31, 2024, Air Wisconsin had $4,555 of operating lease obligations primarily related to certain training simulators and facilities.

**8. Retirement and Other Benefit Plans** 

***401(k) Plans***

For the years ended December 31, 2024 and December 31, 2023, the Company had defined contribution retirement plans that covered substantially all employees. The Company contributed to these plans. The total expense incurred under all of the defined contribution plans for the years ended December 31, 2024 and December 31, 2023 was $4,349 and $4,262, respectively.

***Supplemental Executive Savings Plan (SESP)***

The Company maintained the SESP for the benefit of certain executives. The SESP offered deferred compensation retirement benefits that would otherwise be subject to the compensation limits imposed by the Internal Revenue Code on Company contributions to the Air Wisconsin Airlines Savings Plan. As of December 31, 2024 and December 31, 2023, the Company recorded Long-term restricted investments of $3,797 and $3,194, respectively, and a Long-term deferred compensation liability of $3,823 and $3,216, respectively, on its consolidated balance sheets. The SESP was terminated effective as of January 9, 2026, in connection with the Aviation Disposition.

For additional information, please refer to Note 1, *Summary of Significant Accounting Policies,* and Note 15, *Subsequent Events.*

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**9. Related-Party Transactions** 

Resource Holdings Associates ("Resource Holdings") provides AWAC and Air Wisconsin with financial advisory and management services pursuant to an agreement entered into in January 2012. AWAC paid an aggregate of $240 to Resource Holdings for each of the years ended December 31, 2024 and December 31, 2023, respectively, for these services, plus the reimbursement of certain out-of-pocket expenses.

In June 2021, Harbor agreed to pay Resource Holdings an annual fee of $150, payable monthly, for financial advisory and management services, which amount is in addition to the amount paid to Resource Holdings by AWAC. Harbor paid an aggregate of $150 to Resource Holdings for each of the years ended December 31, 2024 and December 31, 2023, for these services, plus the reimbursement of certain out-of-pocket expenses. These amounts are included in Purchased services and other on the consolidated statements of operations.

In January 2020, the Company completed an acquisition from Southshore of regional jets and engines, in exchange for the issuance of 4,000,000 shares of Harbor's Series C Convertible Redeemable Preferred Stock (the "Series C Preferred"). On June 28, 2024, Southshore converted its Series C Preferred into 16,500,000 shares of Harbor's common stock. For additional information, please refer to Note 11, *Earning Per Share and Equity,* and Note 15, *Subsequent Events*.

**10. Collective Bargaining Agreements** 

As of December 31, 2024, Air Wisconsin had five collective bargaining units. The Airline Pilots Association ("ALPA") represents pilots. The Association of Flight Attendants-CWA ("AFA") represents flight attendants. The International Association of Machinists and Aerospace Workers AFL-CIO ("IAMAW") represents both mechanics and technical store clerks under two separate collective bargaining agreements. The Transport Workers Union of America ("TWU") represents dispatchers.

As of December 31, 2023, Air Wisconsin had reached a new agreement with ALPA and its pilots which became effective in October 2023 and with TWU and its dispatchers in April 2024. Additionally, Air Wisconsin was in negotiations with both AFA and its flight attendants, and IAMAW and its mechanics and clerical employees.

Amendable dates for each bargaining unit are:

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| | | |
|:---|:---|:---|
| Bargaining Unit | Amendable Date | Percentage of Workforce |
| Pilots | October 11, 2026 | 47.4% |
| Dispatchers | April 12, 2028 | 3.2% |
| Mechanics | September 20, 2023 | 24.3% |
| Technical store clerks | September 20, 2022 | 4.4% |
| Flight attendants | October 1, 2022 | 20.7% |

---

The unionized workforce and related labor agreements remained with Air Wisconsin following the Aviation Disposition, so the Company is no longer party to any collective bargaining agreements.

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**11.&nbsp;&nbsp;&nbsp;&nbsp;Loss Per Share and Equity** 

Calculations of net loss per share of common stock were as follows for the periods presented:

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| | | |
|:---|:---|:---|
| | Year ended December 31, 2024 | Year ended December 31, 2023 |
| Net loss | $(17175) | $(15985) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred stock dividends | 1092 | 1328 |
| Net loss applicable to common stockholders | $(18267) | $(17313) |
| Weighted average common shares outstanding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares used in calculating basic loss per share | 50738144 | 44043175 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock options |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Series C preferred |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares used in calculating diluted loss per share | 50738144 | 44043175 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss allocated to common stockholders per common share |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic | $(0.36) | $(0.39) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted | $(0.36) | $(0.39) |

---

Basic loss per share of common stock is computed by dividing the net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period.

Diluted loss per share is computed by dividing net loss by the weighted average number of shares outstanding assuming the conversion of the Series C Preferred into an aggregate of 16,500,000 shares of common stock under the if-converted method prior to its conversion in June 2024. Based on the applicable accounting guidance, Harbor was required to apply the "if-converted" method to the Series C Preferred to determine the weighted average number of shares outstanding for purposes of calculating the net loss per share of common stock. However, conversion was not assumed for purposes of computing diluted loss per share if the effect would be anti-dilutive (as was the case for all periods presented).

***Series C Convertible Redeemable Preferred Stock***

In January 2020, Harbor issued 4,000,000 shares of the Series C Preferred to Southshore in connection with the acquisition of regional jets and engines. The rights, preferences, privileges, qualifications, restrictions and limitations relating to the Series C Preferred are set forth in the Certificate of Designations, Preferences and Rights of Series C Convertible Redeemable Preferred Stock ("Certificate of Designations"), which Harbor filed with the Secretary of State of the State of Delaware.

Each share of Series C Preferred was initially convertible at the election of the holders, at any time after issuance, into that number of shares of common stock determined by dividing the then applicable Series C Liquidation Amount (as defined below) by $0.80, subject to certain adjustments set forth in the Certificate of Designations ("Conversion Price"). The Conversion Price was subsequently adjusted to be $0.15091.

On each of March 28, 2024, and June 28, 2024, the board of directors declared a Preferential Dividend of $198 on the Series C Preferred, which was paid on March 29, 2024, and June 28, 2024, respectively. On those same dates, the board of directors also declared Conversion Cap Excess Dividends on the Series C Preferred, which were paid in the amount of $268, and $321, respectively.

On March 31, 2023, June 30, 2023, September 27, 2023, and December 17, 2023, the board of directors declared a Preferential Dividend of $198 on the Series C Preferred, which was paid on March 31, 2023, June 30, 2023, September 29, 2023 and December 29, 2023, respectively. On those same dates in 2023, Conversion Cap Excess Dividends were also declared on the Series C Preferred, and paid in the amount of $53, $107, $161 and $214 respectively.

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On June 28, 2024, 754,550 shares of Series C Preferred were converted into 16,500,000 shares of Harbor's common stock, and all of the 3,245,450 Conversion Cap Excess Shares were redeemed for $10,710. After giving effect to such conversion and redemption, no shares of Series C Preferred remained outstanding as of December 31, 2024.

Harbor accounted for its Series C Preferred in accordance with the guidance in ASC 480, *Distinguishing Liabilities from Equity*. Based on the applicable accounting guidance, preferred stock that is conditionally redeemable is classified as temporary or "mezzanine" equity. Accordingly, the Series C Preferred, which was subject to conditional redemption while it was outstanding, was presented at redemption value as mezzanine equity outside of the stockholders' equity section of the consolidated balance sheets as of December 31, 2023.

**12.&nbsp;&nbsp;&nbsp;&nbsp;Supplemental Cash Flow Information** 

The following information is provided in support of the consolidated statements of cash flows. Cash payments for interest for the years ended December 31, 2024 and December 31, 2023 were $9 and $2,083, respectively. Cash refunds for income taxes for the years ended December 31, 2024 and December 31, 2023 were $641 and $2,471, respectively.

The following table provides a schedule of the non-cash activities pertaining to the statements of cash flows for the years ended:

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| | | |
|:---|:---|:---|
| | December 31, 2024 | December 31, 2023 |
| Gain on Long-term restricted investments (SESP) | $541 | $2219 |
| Long-term deferred compensation (SESP) | 581 |  |
| Net investment in sales lease |  | 2132 |
| Right-of-use assets acquired under operating leases | 1493 | 2172 |

---

The following table provides a reconciliation of all cash and cash equivalents and restricted cash reported in the consolidated balance sheets that sum to the total of those same amounts shown in the consolidated statements of cash flows:

---

| | | |
|:---|:---|:---|
| | December 31, 2024 | December 31, 2023 |
| Cash and cash equivalents | $14952 | $20776 |
| Restricted cash | 667 | 755 |
| **Total cash, cash equivalents, and restricted cash** | $15619 | $21531 |

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**13.&nbsp;&nbsp;&nbsp;&nbsp;Intangible Assets** 

Intangible assets consist of the following indefinite-lived assets as of the dates presented:

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| | | |
|:---|:---|:---|
| | December 31, | December 31, |
| | 2024 | 2023 |
| | Gross Carrying Amount | Gross Carrying Amount |
| Trade names and air carrier certificate | $5300 | $5300 |
| **Total** | $5300 | $5300 |

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Following the Aviation Disposition, the air carrier certificate and "Air Wisconsin Airlines LLC" and associated airline operations trade names (e.g., Air Wisconsin, AW, etc.) remained with Air Wisconsin.

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**14.&nbsp;&nbsp;&nbsp;&nbsp;Stock Repurchase Program** 

On March 30, 2021, Harbor's board of directors adopted a stock repurchase program pursuant to which Harbor was initially authorized to repurchase up to $1,000 of shares of its common stock during the first calendar month of the program, subject to an automatic increase of $1,000 per calendar month thereafter. The number of shares to be repurchased, and the timing of any such repurchases, depends on a number of factors, including the trading price and volume of the common stock, the Company's business strategy, financial performance, liquidity position and capital requirements, restrictions in commercial agreements, general market conditions, applicable legal requirements and other factors. Harbor is not obligated under the program to acquire any particular dollar amount or number of shares, and the program may be modified, suspended or terminated at any time and for any reason.

In January 2023, a federal corporate stock repurchase excise tax of 1.0% took effect once share repurchases exceed $1,000. Harbor accrued an excise tax liability of $20 and $45 during the year ended December 31, 2024 and December 31, 2023, respectively, which is included in the cost of Treasury stock in the consolidated statements of stockholders' equity. Harbor acquired a total of 1,132,594 and 2,093,382 shares of its common stock pursuant to the stock repurchase program in the years ended December 31, 2024 and December 31, 2023, respectively. As of December 31, 2024, total cash of $344 is held for the repurchase of shares under the stock repurchase program, compared to $376 as of December 31, 2023, which is reflected as restricted cash in the consolidated financial statements.

From the inception of the program through March 31, 2025, Harbor has purchased approximately 12.9 million shares of its common stock pursuant to the program. No shares have been purchased after that date.

**15.&nbsp;&nbsp;&nbsp;&nbsp;Subsequent Events** 

The Company evaluated its consolidated financial statements for the year ended December 31, 2024 for subsequent events through the date the consolidated financial statements were issued. The following subsequent events are noted:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On January 3, 2025, Air Wisconsin, received written notice from American terminating the American capacity purchase agreement. The termination notice provided for a "wind-down" schedule for the withdrawal of aircraft from the agreement beginning on March 6, 2025 and ending with the termination of the agreement on April 3, 2025

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On January 10, 2025, Air Wisconsin announced the strategic transition of its operations following the termination of the American capacity purchase agreement. In connection with that transition, Air Wisconsin implemented a workforce reduction plan to re-balance its workforce to better align with that transition. On January 30, 2025, Air Wisconsin issued notices to all employees pursuant to the Worker Adjustment and Retraining Notification Act ("WARN"). On March 14, 2025, Air Wisconsin notified approximately 240 employees, consisting of 123 management employees, 100 pilots, and 13 dispatchers, that they would be furloughed or terminated effective March 31, 2025, or within a short period of time thereafter. On April 10, 2025, Air Wisconsin announced additional workforce reductions that affected approximately 400 additional employees that became effective on June 9, 2025, or a short period of time thereafter, and included the furlough of certain unionized employees. On August 29, 2025, Air Wisconsin issued new notices to all employees pursuant to WARN. No further workforce reductions were made pursuant to WARN and the notice period expired on December 31, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On April 28, 2025, the Board of Managers of Air Wisconsin approved cash retention incentive bonuses for certain senior management employees, including Robert Binns, the former Chief Executive Officer and President of Air Wisconsin, and Liam Mackay, the former Chief Financial Officer of Air Wisconsin. Each of Messrs. Binns and Mackay was entitled to receive a retention incentive bonus in an amount equal to 50% of his current base salary payable as follows: (i) 20% on or about June 30, 2025, (ii) 20% on or about September 30, 2025, (iii) 20% on or about December 31, 2025, and (iv) 40% on or about March 31, 2026, subject, in each case, to remaining employed by Air Wisconsin through the applicable payment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On August 29, 2025, the Company, entered into a non-binding letter of intent that contemplated a proposed transaction under which the Company would sell its equity in AWAC along with certain airframes, engines, and other operating assets. This transaction failed to consummate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In December 2025, the Company entered into three related purchase agreements pursuant to which it sold its membership interests in Air Wisconsin and all of its other remaining aviation assets. The three agreements

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were interdependent and the closing of the transactions contemplated thereby occurred simultaneously on January 9, 2026. The aggregate consideration received in connection with these three agreements was $111,100, subject to certain customary purchase price adjustments and the impact of required tax obligations. Including the other sales, for which the Company received approximately $14,800 in aggregate consideration, the aggregate consideration received for the Aviation Disposition was approximately $125,900. After giving effect to the Aviation Disposition, the Company no longer has any material operating assets, is not engaged in any operating business, and does not have any source of revenue from operations. The Company's primary assets are comprised of cash and cash equivalents, restricted cash, and marketable securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In connection with the Aviation Disposition, on December 19, 2025, the Board of Managers of Air Wisconsin approved the termination of the SESP, which terminated on January 9, 2026.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In connection with the Aviation Disposition, Harbor's board of directors approved bonuses for certain officers and employees totaling, in the aggregate approximately $4,300.

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**ITEM 9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE** 

None.

**ITEM 9A.&nbsp;&nbsp;&nbsp;&nbsp; CONTROLS AND PROCEDURES**

**Management's Evaluation of Disclosure Controls and Procedures** 

Our management, under the supervision and with the participation of our principal executive officer, principal financial officer and principal accounting officer, carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2024. Disclosure controls and procedures, as defined in Rule 15d-15(e) under the Exchange Act, mean controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive officer, principal financial officer and principal accounting officer, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, as of December 31, 2024, the last day of the period covered by this Annual Report, our management, including our principal executive officer, principal financial officer and principal accounting officer, concluded that our disclosure controls and procedures were not effective because of the material weakness in our internal control over financial reporting, as defined in Rule 15(d)-15(f) under the Exchange Act, described below.

**Limitations on Effectiveness of Controls** 

Our management, including our principal executive officer, principal financial officer and principal accounting officer, does not expect that our disclosure controls and procedures, or our system of internal control over financial reporting, will prevent or detect all errors and all fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control failures within the Company have been or will be detected. A control system, no matter how well designed or operated, can provide only reasonable assurance that the objectives of the system are met.

The design of our control system reflects the fact that there are resource constraints, and the benefits of such control system must be considered relative to their costs. For example, management may deem it to be appropriate to retain third-party advisors to analyze and interpret complex accounting issues, where management lacks technical knowledge, rather than bearing the significant costs associated with hiring additional accounting personnel with expertise in complex accounting matters.

Further, the inherent limitations in any control system include the realities that judgments in decision-making can be incorrect and that breakdowns can occur because of errors or misinterpretations. Accounting standards are complex, and are subject to changing guidance and differing interpretations, even where knowledgeable third-party advisors are involved. Notwithstanding the exertion of significant effort and resources to interpret and apply accounting standards and any related guidance, it is possible that they may be misinterpreted or misapplied, or that prior interpretations may be reconsidered and changed, which may result in technical accounting errors. Any such accounting error could result in a restatement of previously issued consolidated financial statements, and may result in a determination that a material weakness in internal control exists, notwithstanding the scope of the effort applied to, or the magnitude of the resources invested in, performing the relevant analysis.

Additionally, although we are not aware of any such instances, controls can be circumvented by the intentional acts of individuals, by collusion of two or more people, or by management override of the controls. Finally, the design of any system of controls is necessarily based in part on certain assumptions about the likelihood of future events, and there can be no assurance that the design of any particular control will always succeed in achieving its objective under all potential future conditions.

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**Material Weakness in Internal Control Over Financial Reporting**

As disclosed in the 2023 Annual Report, in connection with the preparation of our consolidated financial statements for the year ended December 31, 2023, and following extensive discussions among management, the Audit Committee, and our independent registered public accounting firm, as well as consultation between management and multiple additional accounting and legal advisors over a period of several months, we determined that the previously issued consolidated financial statements for the year ended December 31, 2022, as well as the interim unaudited condensed consolidated financial statements for the first three quarters of the years ended December 31, 2022 and December 31, 2023, should no longer be relied upon and that such financial statements should be restated. As a result of this determination, we concluded that we had a material weakness in our internal control over financial reporting as of December 31, 2023. As noted below, the related remediation efforts are ongoing.

The identified material weakness arose from our recognition of certain disputed amounts under the United capacity purchase agreement that were in dispute in the United arbitration. We previously recognized all of the disputed amounts, which we later determined, in consultation with knowledgeable third-party advisors, was inconsistent with the technical requirements of Accounting Standards Codification Topic 606, *Revenue from Contracts with Customers* ("ASC 606"). Specifically, we determined that, contrary to the prior conclusion we reached in consultation with knowledgeable third-party advisors regarding the correct application of a complex standard to a complex agreement, we should have constrained a portion of the disputed amounts. This determination was based on additional guidance received from additional third-party advisors as to the manner in which ASC 606 should be applied to the recognition of revenue under the agreement, irrespective of the actual outcome of the dispute with United. This deficiency led to a material error (as that concept is defined in the accounting guidance) in our previously issued consolidated financial statements, which in turn led to the restatement of those financial statements and the finding of a material weakness in our internal control over financial reporting as of December 31, 2023.

**Remediation of Material Weakness**

With the oversight of the Audit Committee, throughout the year ended December 31, 2024, our management continued to implement additional measures intended to improve our internal control over financial reporting with the objective of remediating the material weakness identified above, including (i) enhancing our internal process for the review and interpretation of accounting guidance as it applies to our capacity purchase agreements, and (ii) engaging new or additional knowledgeable third-party advisors with relevant experience in analyzing accounting guidance as it applies to complex commercial agreements, including determining the appropriate accounting for revenue derived from our capacity purchase agreements.

While we believe our efforts improved our internal control over financial reporting, remediation of the identified material weakness will require further validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles, and we concluded that the identified material weakness had not been fully remediated as of December 31, 2024. We cannot provide assurance that the remediation efforts we are implementing will be sufficient to remediate the identified material weakness or to avoid potential future material weaknesses or significant deficiencies.

**Changes in Internal Control Over Financial Reporting (Through December 31, 2024)**

Except for the remediation measures discussed above, there have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**Subsequent Events Impacting Internal Control Over Financial Reporting**

As discussed above, the identified material weakness arose from a determination that our recognition of certain disputed amounts under the United capacity purchase agreement was inconsistent with the technical requirements of ASC 606. However, the United capacity purchase agreement was terminated in early June 2023 and we do not anticipate receiving additional revenue under that agreement. In addition, the American capacity purchase agreement entered into in August 2022 was terminated in April 2025, and we do not anticipate receiving additional revenue under that agreement. Further, as a result of the Aviation Disposition, we do not have any material operating assets, are not engaged in any operating business, and do not have any current or anticipated source of revenue from operations. Specifically, we do not anticipate entering into any capacity purchase agreement (or similar agreement) in future periods. Accordingly, the circumstances resulting in a determination that we have a material weakness in our internal control over financial reporting,

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namely the recognition of revenue under our prior capacity purchase agreement pursuant to ASC 606, are no longer relevant to our business or financial statements going forward.

However, after giving effect to the Aviation Disposition, we have a small number of employees, executive officers and advisors who manage our day-to-day affairs, oversee our remaining assets and obligations, evaluate strategic alternatives and execute any transaction we may pursue. As a result, we have a limited number of employees with expertise in financial and accounting matters, developing and maintaining a system of internal controls, and remediating material weaknesses or significant deficiencies in internal control over financial reporting. This development creates additional risk that our internal control over financial reporting may not be effective in future periods. For additional information, please refer to Part I, Item 1,"*Business* and Part I, Item 1A *Risk Factors,* in this Annual Report.

**No Attestation Report of the Registered Public Accounting Firm** 

As a "non-accelerated filer," we are not required to include an attestation report of our independent registered public accounting firm on our internal control over financial reporting.

**ITEM 9B.&nbsp;&nbsp;&nbsp;&nbsp; OTHER INFORMATION**

During the three months ended December 31, 2024, no director or officer of the Company adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

**ITEM 9C.&nbsp;&nbsp;&nbsp;&nbsp; DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS** 

Not applicable.

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**PART III** 

**ITEM 10.&nbsp;&nbsp;&nbsp;&nbsp; DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE** 

Consistent with SEC rules, our executive officers during the year ended December 31, 2024 included certain officers of our former subsidiary, Air Wisconsin. The following table sets forth information concerning our executive officers and directors as of December 31, 2024:

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| ***Executive Officers*** | | |
| Christine R. Deister | 75 | Chief Executive Officer and Secretary, Harbor Diversified, Inc.<br>*Principal Executive Officer* |
| Robert Binns<sup>(1)</sup> | 60 | Chief Executive Officer and President, Air Wisconsin Airlines LLC |
| Liam Mackay<sup>(2)</sup> | 41 | Chief Financial Officer, Air Wisconsin Airlines LLC<br>*Principal Financial Officer* |
| Gregg Garvey<sup>(3)</sup> | 59 | Senior Vice President, Chief Accounting Officer and Treasurer, Air Wisconsin Airlines LLC<br>*Principal Accounting Officer* |
| ***Non-Employee Directors*** |  |  |
| Richard A. Bartlett | 67 | Director, Harbor Diversified, Inc. |
| Nolan Bederman<sup>(4)</sup> | 52 | Director, Harbor Diversified, Inc. |
| Kevin J. Degen<sup>(4)</sup> | 67 | Director, Harbor Diversified, Inc. |

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(1)In connection with the Aviation Disposition, Mr. Binns resigned his positions as President and Chief Executive Officer of Air Wisconsin effective January 9, 2026.

(2)Mr. Mackay resigned as Chief Financial Officer of Air Wisconsin effective September 5, 2025.

(3)In connection with the Aviation Disposition, Harbor's board of directors appointed Mr. Garvey as Executive Vice President, Chief Financial Officer, and Treasurer of Harbor effective January 9, 2026. Mr. Garvey currently serves as our principal financial officer and principal accounting officer.

(4)Serves as a member of our Audit Committee.

***Executive Officers***

***Christine R. Deister***

Ms. Deister has served as the Company's Chief Executive Officer and Secretary since March 2020. Ms. Deister has also served as Chief Financial Officer and Secretary of Lotus Aviation Leasing, LLC and Chief Financial Officer and Secretary of Air Wisconsin Funding LLC since April 2020, as well as President, Secretary and a director of Harbor Therapeutics, Inc. since April 2020. Ms. Deister has served as Vice President of Special Projects for Air Wisconsin since April 2020 and also serves as Executive Vice President and a director of AWAC Aviation, Inc. ("AWAC"). Ms. Deister was initially appointed Chief Financial Officer and Secretary of the Company in March 2012, and was subsequently appointed President of the Company in July 2019. Previously, Ms. Deister served as President and Chief Executive Officer of Air Wisconsin from April 2015 until March 2019 and as Chief Executive Officer until March 2020. From November 2014 to April 2015, Ms. Deister served as Chief Commercial Officer of Air Wisconsin. From November 2004 to November 2014, Ms. Deister served as Executive Vice President and Chief Financial Officer of Air Wisconsin. Prior to Air Wisconsin, Ms. Deister served as Executive Vice President and Chief Financial Officer of Hawaiian Airlines from 2001 to November 2004. Prior to 2001, Ms. Deister held various executive roles with Trans World Airlines, including Senior Vice President of Finance and Treasurer. In connection with the Aviation Disposition, Ms. Deister retired from her employment at Air Wisconsin and resigned as an officer of Air Wisconsin. Ms. Deister continues to serve as Harbor's Chief Executive Officer and Secretary.

***Robert Binns***

Mr. Binns served as Air Wisconsin's President from April 2019 until the Aviation Disposition on January 9, 2026, and as its Chief Executive Officer from March 2020 until January 9, 2026. Mr. Binns also served as a member of the board

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of managers of Air Wisconsin and as Executive Vice President and a director of AWAC from April 2020 until January 9, 2026. Prior to joining Air Wisconsin, Mr. Binns was the Chief Executive Officer and member of the board of managers of Hybrid Enterprises, LLC, the exclusive reseller of Lockheed Martin's hybrid airship, until December 2018 and held executive roles with Wivenhoe Aviation, LLC, from 2013 to 2015, Global Aviation Holdings, from 2004 to 2013, TransMeridian Airlines, from 2001 to 2004, Pegasus Aviation, from 1999 to 2001, and Trans World Airlines, from 1994 to 1999. Since 2007, Mr. Binns has served as a member of the Board of Councilors of The Carter Center. Mr. Binns holds an M.B.A. from the University of Kansas, an M.A. in Political Behavior from Essex University in England, and a B.A. in History and Political Science from the University of Kansas. In connection with the Aviation Disposition, Mr. Binns resigned as an officer, manager and employee of Air Wisconsin and as an officer and director of AWAC.

***Liam Mackay***

Mr. Mackay served as Air Wisconsin's Chief Financial Officer from January 1, 2021 to September 5, 2025. Prior to joining Air Wisconsin, Mr. Mackay served as Director, United Express Commercial Strategy at United, since 2019. From 2016 to 2019, Mr. Mackay served as Director, United Express Regional Partner Management at United, and from 2011 to 2016, he served as Senior Manager, Financial Analysis at United. Mr. Mackay graduated from The University of Western Ontario in 2005 with a Bachelor of Administrative and Commercial Studies in Commercial Aviation Management degree, and he obtained an M.B.A. in Aviation from Embry-Riddle Aeronautical University in 2007. Mr. Mackay resigned his employment with, and as Chief Financial Officer of, Air Wisconsin effective September 5, 2025.

***Gregg Garvey***

Mr. Garvey served as Air Wisconsin's Senior Vice President, Chief Financial Officer and Treasurer from September 2025 until the Aviation Disposition on January 9, 2026, and worked with Air Wisconsin in various roles since 1999. Mr. Garvey also served as Vice President, Chief Financial Officer and Treasurer of AWAC. Prior to joining Air Wisconsin in 1999, Mr. Garvey served as a Tax Manager, Tax Supervisor, and Staff Accountant at Schenck & Associates (currently part of CliftonLarsonAllen LLP), a large regional public accounting firm in Appleton, Wisconsin. Mr. Garvey also held positions of Financial Analyst and Forecasting Accountant and Senior Tax Accountant at Repap Wisconsin, Inc., a paper company formerly located in Kimberly, Wisconsin. Mr. Garvey holds a B.B.A. in Accounting from the University of Wisconsin-Whitewater, an M.S. in Taxation from the University of Wisconsin-Milwaukee, and an M.B.A. from the University of Wisconsin-Oshkosh. Mr. Garvey is also a Certified Public Accountant. Mr. Garvey was appointed Executive Vice President, Chief Financial Officer and Treasurer of Harbor in January 2026.

***Non-Employee Directors***

***Richard A. Bartlett***

Mr. Bartlett has served on Harbor's board of directors since August 2011. Mr. Bartlett is the managing director of Resource Holdings, Ltd., a private equity firm located in New York, New York. He has served on the board of directors of numerous privately held and publicly traded companies across a wide variety of industries, including the board of directors of Air Wisconsin for more than 25 years. Mr. Bartlett served on the board of directors of US Airways, Inc. from 2005 to 2008. Prior to joining Resource Holdings, Ltd. in 1984, he served as a law clerk for an associate justice of the Supreme Court of the United States, and prior to that, for a senior judge of the U.S. Circuit Court for the District of Columbia. Mr. Bartlett received his J.D. from Yale Law School and his B.A. from Princeton University.

We believe Mr. Bartlett's experience serving as a principal at a private equity firm for over 30 years, and on the boards of directors of multiple companies, including Air Wisconsin and US Airways, Inc., provides him with the skills necessary to understand business strategy and planning, financial statements, and board process and functions, all of which qualify him for service as a director.

***Nolan Bederman***

Mr. Bederman has served on Harbor's board of directors and on Air Wisconsin's board of managers since March 2019. Mr. Bederman currently serves as a founder and Managing Partner of Bederman Capital Corp., a private equity firm. Prior to forming Bederman Capital Corp., Mr. Bederman served as partner and co-founder of Genuity Capital Partners from 2005 to 2013. Prior to Genuity Capital Partners, Mr. Bederman served as an executive director of private equity with CIBC Capital Partners from 2002 to 2004, and was promoted to Vice President of investment banking with Merrill Lynch & Co., where he served as a mergers and acquisitions advisor from 1998 to 2002. Mr. Bederman has served since 2013 as

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Chair, and since 2021 as Executive Chair, of the board of LifeSpeak, Inc., a public company. He has also served since 2016 as Chair of the board of Berkeley Street Holdings, Inc. Mr. Bederman received his J.D. and M.B.A. from the University of Toronto, and a B.A. in Economics from the University of Western Ontario.

We believe Mr. Bederman's experience in private equity, as the founder of multiple complex organizations, and as a director of another public company, brings to Harbor's board of directors critical skills related to leadership, financial oversight, strategic planning and corporate governance, all of which qualify him for service as a director.

***Kevin J. Degen***

Mr. Degen has served on Harbor's board of directors and on Air Wisconsin's board of managers since March 2019. Mr. Degen has been a principal with Greencastle Advisors LLC, an advisory firm in the transportation sector, from 2010 to the present. In addition, Mr. Degen served as a Vice President with Burnham Sterling & Company, a financial advisory firm, from January 2023 to January 2024. Prior to founding Greencastle, Mr. Degen was employed by Seabury Group LLC, an aviation advisory firm, from 2000 to 2009, where he was a Managing Director. Prior to Seabury Group, from 1996 to 1999, Mr. Degen served as Senior Vice President for Donaldson, Lufkin and Jenrette, an investment banking firm, and from 1993 to 1996, as a portfolio manager with Southport Management Group. Prior to Southport, Mr. Degen held various investment banking positions with Lehman Brothers, PaineWebber Inc., and E.F. Hutton Inc. from 1982 to 1992. Mr. Degen served as a director of START III USA LLC, an aircraft leasing SPV, from 2019 to 2022. Mr. Degen received an M.B.A. from Harvard Business School and a B.S. in Engineering from Princeton University.

We believe Mr. Degen's extensive experience within the transportation sector, as well as his many years serving as an advisor and investment banker, provide him with industry experience, knowledge of complex organizations, and financial management and strategic planning skills, all of which qualify him for service as a director.

**Changes to Procedures for Stockholder Nominations for Directorships**

There were no material changes in 2024 to the process by which our stockholders may recommend nominees to Harbor's board of directors since we last provided disclosure of such procedures.

**Family Relationships and Other Arrangements**

There are no family relationships between any of our directors or executive officers. There are no arrangements or understandings between or among our executive officers and directors pursuant to which any director or executive officer was or is to be selected as a director or executive officer.

**Involvement in Certain Legal Proceedings**

There are no legal proceedings involving any of our directors or executive officers which require disclosure by Harbor pursuant to applicable SEC rules.

**Code of Business Conduct and Ethics** 

We have adopted a Code of Business Conduct and Ethics for Senior Financial Officers (the "Code of Ethics") applicable to our principal executive officer, principal financial officer, principal accounting officer and other officers that have a financial oversight role, which is intended to comply with the requirements of Item 406 of Regulation S-K. We expect that any amendment to the Code of Ethics, or any waivers of its requirements applicable to our executive officers, will be disclosed in our future filings under the Exchange Act. The Code of Ethics was previously filed as an exhibit to our SEC reports and is incorporated by reference into this Annual Report.

**Investment Policy**

Following the Aviation Disposition, the Company's remaining assets are predominantly comprised of Liquid Assets. The Company could potentially be deemed an "investment company" pursuant to the Investment Company Act. The Investment Company Act provides a number of exemptions, including a one-year safe harbor for companies that are seeking to acquire an operating business. The Company intends to avail itself of this exemption.

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In furtherance of this intention, the Company has adopted an investment policy with the primary objectives of (1) ensuring the safety of capital and preservation of purchasing power, (2) preserving liquidity, (3) maintaining short-term maturities, and (4) managing towards reasonable rates of return in light of the other investment objectives (the "Investment Policy"). Consistent with the Investment Policy, the Company's Liquid Assets are primarily invested in deposit accounts, money market funds, government-backed securities and similar investments.

For additional information, please refer to the section titled "*Our Business Strategy*" in Part I, Item 1, *Business*.

**Meetings of the Board of Directors** 

During 2024, Harbor's board of directors held 11 regularly scheduled meetings and numerous additional meetings.

**Board of Director Policies and Procedures** 

Harbor's board of directors has documented our corporate governance practices by adopting certain policies and procedures, including the Code of Ethics, a Trading Restriction Policy and the charter of the Audit Committee. These policies and procedures are designed to ensure Harbor's board of directors, together with the Audit Committee, has the necessary authority and governance frameworks in place to make decisions independent of the Company's management.

The Code of Ethics restricts our principal executive officer, principal financial officer, principal accounting officer, and any other officer (including any officer of our subsidiaries) that is performing similar functions or that is performing a financial oversight role from trading in Harbor's common stock, subject to limited exceptions. Similarly, the Trading Restriction Policy restricts our (and any of our subsidiaries') officers, employees, agents and consultants, and certain other covered persons, from trading in Harbor's common stock, subject to limited exceptions.

The Investment Policy governs the investment of our Liquid Assets and establishes compliance parameters designed to support our strategic objectives and ensure compliance with the safe harbor exemption.

**Audit Committee** 

Harbor has a standing Audit Committee of its board of directors. The Audit Committee oversees the Company's corporate accounting and financial reporting process and the audits of the Company's financial statements. For this purpose, the Audit Committee's principal functions are to: (i) oversee the integrity of the Company's financial statements, the audits of the Company's financial statements conducted by the Company's independent registered public accounting firm ("Independent Auditors"), the qualifications, independence and performance of the Independent Auditors, and compliance with legal, regulatory and disclosure requirements relating to the Company's accounting and financial reporting processes; (ii) review the Company's internal control over financial reporting; and (iii) facilitate communication among the Independent Auditors, the Company's financial and senior management, and Harbor's board of directors. The Audit Committee is directly responsible for oversight of the work of the Independent Auditors, including resolution of any disagreements between management and the Independent Auditors regarding financial reporting or the application of accounting policies. This oversight includes review and discussion with management and the Independent Auditors of (i) the Company's financial statements and the reports or information delivered to the Audit Committee by the Independent Auditors; and (ii) analyses prepared by management and the Independent Auditors setting forth significant financial reporting issues and judgments made in connection with the preparation of the financial statements, as well as assessment of the Company's system of internal control over financial reporting.

The Audit Committee is also responsible for the review and approval of any significant conflicts of interest and any material related party transaction and for overseeing the application of any related party transaction policy. A related party transaction means any transaction, arrangement or understanding, or any series of similar transactions, arrangements or understandings to which Harbor (or any of its subsidiaries) is or will be a party for which the amount involved exceeds $120,000, and in which any director, executive officer, holder of more than 5% of Harbor's common stock, or any member of the immediate family of any of the foregoing persons, had or will have a direct or indirect material interest.

The Audit Committee is presently comprised of two directors and operates under a written charter adopted by Harbor's board of directors. Harbor's board of directors reviews and assesses the adequacy of the Audit Committee's written charter on an annual basis. The current members of the Audit Committee are Messrs. Bederman and Degen.

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Harbor's board of directors regularly reviews the qualifications of the Audit Committee members and has determined that each of the Audit Committee members: (i) is "independent" as defined in Rule 10A-3 under the Exchange Act, (ii) is an "independent director" as defined under the Nasdaq Rules, (iii) has the ability to read and understand financial statements, and (iv) qualifies as an "audit committee financial expert" as defined in Item 407 of Regulation S-K. The latter determination is based on a qualitative assessment of each member's level of knowledge and experience based on a number of factors.

During 2024, the Audit Committee held four regularly scheduled meetings and numerous additional meetings. Each of the members of the Audit Committee attended all of the meetings of the Audit Committee held during 2024.

**ITEM 11.&nbsp;&nbsp;&nbsp;&nbsp; EXECUTIVE COMPENSATION**

**Director Compensation** 

For service on Harbor's board of directors, each director receives a quarterly cash retainer of $20,000. For service on the Audit Committee, each member receives an additional quarterly cash retainer of $4,000. The directors are not paid additional amounts for attendance at board or committee meetings.

To the extent any director serves on the board of directors (or similar governing body) of any of our active subsidiaries, the director is paid a quarterly cash retainer in the amount of $2,500, which amount is in addition to amounts paid for service on Harbor's board of directors. Messrs. Bederman and Degen each served on Air Wisconsin's board of managers prior to the Aviation Disposition.

No current director has been granted any equity awards in connection with his service on Harbor's board of directors or the Audit Committee, and no equity incentive plan has been adopted for this purpose.

We reimburse reasonable expenses incurred in connection with attending board and committee meetings.

**Director Compensation Table** 

The following table sets forth summary compensation information for our directors for the year ended December 31, 2024:

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Fees Earned**<br>**Or Paid in**<br>**Cash**<br>**($)**<sup>(1)</sup> | **All Other<br>Compensation<br>($)** | **Total<br>($)** |
| Richard A. Bartlett | $80000 |  | $80000 |
| Nolan Bederman<sup>(2)</sup> | $106000 |  | $106000 |
| Kevin J. Degen<sup>(2)</sup> | $106000 |  | $106000 |

---

(1)Each of the directors earned a quarterly cash retainer of $20,000 for serving on Harbor's board of directors.

(2)Messrs. Bederman and Degen each earned a quarterly cash retainer of $4,000 for serving on the Audit Committee, and a quarterly cash retainer of $2,500 for serving on the board of managers of Air Wisconsin.

**Executive Compensation**

This narrative discussion of the compensation objectives, policies and arrangements that apply to our named executive officers is intended to be read in conjunction with the Summary Compensation Table and related disclosures set forth below. As a "smaller reporting company," we are eligible to comply with scaled executive compensation disclosure requirements under applicable SEC rules.

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**Named Executive Officers** 

Our named executive officers include our principal executive officer and our two other most highly compensated executive officers who were serving as executive officers as of December 31, 2024. Consistent with SEC rules, our named executive officers include certain officers of our subsidiary, Air Wisconsin, as indicated in the table below.

For the year ended December 31, 2024, our named executive officers and their positions were:

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| | |
|:---|:---|
| **Named Executive Officer** | **Position** |
| Christine R. Deister | Chief Executive Officer and Secretary, Harbor Diversified, Inc.<br>*Principal Executive Officer* |
| Robert Binns<sup>(1)</sup> | Chief Executive Officer and President, Air Wisconsin Airlines LLC |
| Liam Mackay<sup>(2)</sup> | Chief Financial Officer, Air Wisconsin Airlines LLC<br>*Principal Financial Officer* |

---

(1)&nbsp;&nbsp;&nbsp;&nbsp;In connection with the Aviation Disposition, Mr. Binns resigned as President and Chief Executive Officer of Air Wisconsin effective January 9, 2026.

(2)&nbsp;&nbsp;&nbsp;&nbsp;Mr. Mackay resigned as Chief Financial Officer of Air Wisconsin effective September 5, 2025.

**Compensation Overview** 

The primary objective of our executive compensation program is to attract and retain executives with the skills necessary to lead us in achieving our strategic objectives and creating long-term value for our stockholders. We recognize that there is significant competition for talented executives. While we owned Air Wisconsin, it was particularly challenging to recruit executives and other key employees of the caliber necessary to achieve our goals. When making executive compensation decisions for key Air Wisconsin employees, Harbor's board of directors generally informed itself of the compensation amounts paid to executives at other regional airlines, although this was only one of several factors considered. We have not adopted an equity incentive plan, and have not historically granted equity awards to our named executive officers, which impacts both the aggregate value of compensation that we pay and the mix of compensation elements that we pay relative to other companies in our industry.

**Compensation Objectives** 

When establishing executive compensation, Harbor's board of directors is guided by the following principles:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Attract, retain and incentivize executives with the background, experience and vision necessary to lead us in achieving our strategic objectives and creating long-term value for our stockholders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Provide a total compensation package that is generally competitive with other companies in our industry that operate in similar geographic locations and are of a similar size and stage of growth; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Tie a meaningful portion of the cash bonus opportunity to the achievement of individual and Company performance objectives that are important to the creation of long-term value for our stockholders, while retaining discretion to pay bonuses deemed appropriate by Harbor's board of directors.

**Compensation Determinations** 

Prior to the Aviation Disposition, the members of Air Wisconsin's board of managers, which included two independent managers, was responsible for overseeing our executive compensation program, based on their own experience, their understanding of our business and industry, and feedback from our senior executives. After the Aviation Disposition, Harbor's board of directors, which includes two independent directors, will be responsible for overseeing our executive compensation program. We have not appointed a separate compensation committee. In addition, we have not historically retained a compensation consultant, although we retain the right to do so in the future.

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**Elements of Compensation Program** 

In light of the compensation philosophy and objectives discussed above, the compensation program for our named executive officers generally consists of a base salary, a discretionary cash bonus, and other benefits as described below.

***Base Salary***

We pay base salaries to attract and retain talented executives with the necessary background, experience and vision required for our future growth and success. Base salaries are reviewed periodically and adjusted in response to factors such as title and responsibility level, individual contributions to achieving our strategic objectives, our operational and financial performance, and competitive pay practices within our industry.

***Discretionary Cash Bonus***

Historically, we have not adopted a formal non-equity incentive program as defined in SEC rules. Rather, we have typically paid discretionary cash bonuses to our named executive officers and other senior executives. The target bonus opportunity has generally been expressed as a percentage of base salary, which varies by executive based on factors such as title, responsibility level and tenure. The actual amounts of these bonuses have generally been based on a number of subjective factors such as: (i) individual contributions to achieving our strategic objectives, (ii) our actual operational and financial performance, and (iii) executive retention concerns. Examples of strategic objectives that have impacted historical bonus decisions include the restructuring of debt, the negotiation of key customer agreements, the hiring and retention of pilots, and cash management goals. Historically, most of the cash bonuses awarded have been based on past individual or Company performance. In 2025, the board of managers of Air Wisconsin adopted several retention incentive payment programs for senior executives, including Mr. Binns and Mr. Mackay.

While final determinations of bonus payments are made based on the consideration of a number of individual and Company performance factors, the bonus calculations are typically not formulaic and are therefore discretionary in nature. For additional information, please refer to the section titled "*–Summary Compensation Table,*" in this Annual Report.

***Equity-Based Awards***

We have not historically granted equity awards to our named executive officers, and our named executive officers do not currently own any shares of Harbor's common stock or any equity awards exercisable for or convertible into shares of Harbor's common stock. We have not adopted an equity incentive plan, although we retain the right to do so in the future. Further, the Code of Ethics and the Trading Restriction Policy generally restrict our named executive officers from trading in Harbor's common stock.

***Benefits***

We maintain a 401(k) plan for the benefit of our eligible employees, including our named executive officers other than our Chief Executive Officer. Currently, we contribute up to 3% of a participant's compensation, and, in addition, we match contributions made by participants in an amount up to 50% of the amount contributed by participants, on up to 8% of their compensation, subject to IRS limitations, provided that all Company contributions are discretionary.

For the year ended December 31, 2024, certain senior executives were also eligible to participate in our Supplemental Executive Savings Plan ("SESP"), which is a non-qualified deferred compensation retirement benefit plan. Pursuant to the SESP, we contribute an amount equal to the excess of the full amount of contributions to which the participant would have been entitled under our 401(k) plan, but for the IRS limitations on employer contributions, over the actual amount we contribute to the 401(k) plan for the participant, provided that all Company contributions are discretionary. The SESP was terminated in connection with the Aviation Disposition effective as of January 9, 2026.

**Employment Agreements** 

We had entered into employment agreements with Mr. Binns and Mr. Mackay, each of which is summarized below, although these agreements have been terminated. We have not entered into an employment agreement (or other similar agreement) with Ms. Deister or Mr. Garvey.

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***Binns Agreement***

Air Wisconsin entered into an employment agreement with Mr. Binns (the "Binns Agreement"), pursuant to which he was initially appointed to serve as President of Air Wisconsin in April 2019. Mr. Binns was also appointed to serve as Chief Executive Officer of Air Wisconsin in March 2020. The Binns Agreement had an initial term of two years, from April 1, 2019 through April 1, 2021, and renewed automatically for one-year periods, subject to earlier termination in accordance with its terms.

The Binns Agreement provided for a minimum annual base salary of $425,000.

Pursuant to the Binns Agreement, Mr. Binns was eligible to receive a cash bonus for each year during the term of the Binns Agreement, which would be paid based on the achievement of certain individual and Company performance objectives, as well as certain other subjective factors, as determined by Air Wisconsin's board of managers from time to time. To be eligible to receive the cash bonus, Mr. Binns was required to remain employed through the payment date.

Mr. Binns was also eligible to receive a long-term incentive award (the "LTI Award"), each year during the term of the Binns Agreement in an amount equal to the actual incentive bonus amount for the immediately prior year. For the years ended December 31, 2024 and December 31, 2023, Mr. Binns earned an LTI Award of $170,000 and $276,250, respectively. The LTI Awards were initially payable in cash in four equal annual installments on each of the first four anniversaries of the grant date. Under the terms of the Binns Agreement, to be eligible to receive an annual installment, Mr. Binns was initially required to remain employed on the relevant payment date. However, the deferred portion of the LTI Awards were paid to Mr. Binns in January 2026 in connection with his resignation following the Aviation Disposition. For additional information, please refer to the section titled "*– Summary Compensation Table,*" in this Annual Report.

During the term of the Binns Agreement, Mr. Binns was eligible to participate in such medical, disability, life insurance and other employee benefit plans and programs as are in effect from time to time on the same basis as the other senior executives.

The Binns Agreement was terminated in January 2026 in connection with the Aviation Disposition, and at that time Mr. Binns resigned as an employee, officer, and manager of Air Wisconsin and as an officer and director of AWAC.

***Mackay Agreement***

Air Wisconsin entered into an employment agreement with Mr. Mackay (the "Mackay Agreement") pursuant to which he was appointed to serve as the Chief Financial Officer of Air Wisconsin effective as of January 1, 2021. Mr. Mackay resigned his employment with, and as Chief Financial Officer of, Air Wisconsin effective September 5, 2025. The Mackay Agreement provided Mr. Mackay with (i) an initial employment term of two years, from January 1, 2021 through December 31, 2022, with successive automatic one-year renewal periods, subject to earlier termination as described therein; (ii) a minimum annual base salary of $220,000; and (iii) such medical, disability, life insurance and other employee benefit plans and programs as were in effect from time to time on substantially the same terms as those available to the other senior executives of Air Wisconsin.

Pursuant to the Mackay Agreement, Mr. Mackay was also eligible to receive a cash bonus for each year during the term of the agreement based on the achievement of certain individual and Company performance objectives, as well as certain subjective factors, as determined by Air Wisconsin's board of managers from time to time, with an initial target bonus in an amount equal to 50% of his base salary for the applicable year. The cash bonus earned with respect to a particular year was to be paid no later than March 31 of the following year, so long as Mr. Mackay continued to be employed through the payment date.

**Severance Agreements / Change in Control Agreements** 

Except as described under the section titled "*—Employment Agreements*" in this Annual Report, we currently do not have severance agreements or change in control agreements (or other similar agreements) with any of our named executive officers or other employees. However, we reserve the right to enter into these types of agreements in the future.

**Summary Compensation Table** 

The following table sets forth all of the compensation awarded to, earned by or paid to our named executive officers for the years ended December 31, 2024 and December 31, 2023. The amounts set forth in the table have been calculated in

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accordance with the requirements of applicable SEC rules, and do not necessarily reflect the amounts that have actually been paid to, or which may be realized by, our named executive officers.

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name and Title** | **Year** | **Salary**<br>**($)** | **Bonus**<br>**($)**<sup>(1)</sup> | | **Non-Equity**<br>**Incentive Plan**<br>**Compensation**<br>**($)**<sup>(2)</sup> | **Stock**<br>**and**<br>**Options**<br>**Awards**<sup>(3)</sup> | **All Other**<br>**Compensation**<br>**($)**<sup>(4)</sup> | **Total**<br>**($)** |
| Christine R. Deister | 2024 | 150000 | 75000 |  |  |  | 10000 | 235000 |
| *Chief Executive Officer and Secretary, Harbor Diversified, Inc.* | 2023 | 150000 | 75000 |  |  |  | 10000 | 235000 |
| Robert Binns<sup>(5)</sup> | 2024 | 425000 | 340000 | <sup>(6)</sup> |  |  | 77102 | 842102 |
| *Chief Executive Officer and President, Air Wisconsin Airlines LLC* | 2023 | 425000 | 652500 | <sup>(7)</sup> |  |  | 81091 | 1058591 |
| Liam Mackay<sup>(8)</sup> | 2024 | 248000 | 100000 | <sup>(9)</sup> |  |  | 35746 | 383746 |
| *Chief Financial Officer, Air Wisconsin Airlines LLC* | 2023 | 232833 | 157300 | (10) |  |  | 33541 | 423674 |
|  |  |  |  |  |  | **—** |  |  |

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(1)The amounts in this column reflect the award of discretionary cash bonuses to our named executive officers. Some awards provide for installment payments in more than one year, with each payment being conditioned on the named executive officer being employed on the date of payment.

(2)We did not adopt a non-equity incentive plan, as defined in the applicable SEC rules, during the years ended December 31, 2024 or December 31, 2023.

(3)We have not granted any equity awards to our named executive officers and have not adopted an equity incentive plan.

(4)All other compensation for 2024 included the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)Ms. Deister: aggregate cash payments in the amount of $10,000 for services provided to the board of directors of AWAC (consistent with the amounts paid to the other directors);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)Mr. Binns: (1) aggregate cash payments in the amount of $20,000 for services provided to the board of directors of AWAC and the board of managers of Air Wisconsin (consistent with the amounts paid to the other directors and managers), (2) $24,150 for our contributions pursuant to the 401(k) plan, (3) $21,716 for our contributions to the SESP, and (4) $11,236 for a personal travel allowance benefit (based on the incremental cost to Air Wisconsin); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)Mr. Mackay: (1) $21,850 for our contributions pursuant to the 401(k) plan, (2) $1,482 for our contributions to the SESP and (3) $12,414 for a personal travel allowance benefit (based on the incremental cost to Air Wisconsin).

(5)In connection with the Aviation Disposition, Mr. Binns resigned as President and Chief Executive Officer of Air Wisconsin effective January 9, 2026.

(6)Of this amount, (i) $170,000 reflects a discretionary cash bonus that was earned by Mr. Binns for performance in 2024, which was paid in June 2025, and (ii) $170,000 reflects the issuance of an LTI Award, which was initially payable in cash in four equal annual installments on or about each of the first four anniversaries of the grant date, but the deferred amounts were paid to Mr. Binns in January 2026.

(7)Of this amount, (i) $276,250 reflects a discretionary cash bonus that was earned by Mr. Binns for performance in 2023, $212,500 of which was paid in March of 2024 and the balance of which was deferred and paid to Mr. Binns in January 2026, (ii) $100,000 reflects an additional cash bonus that was earned by Mr. Binns for performance in 2023, which was paid in March of 2024, and (iii) $276,250 reflects the issuance of an LTI Award, which was initially payable in cash in four equal annual installments on or about each of the first four anniversaries of the grant date, but the deferred amounts were paid to Mr. Binns in January 2026.

(8)Mr. Mackay resigned his employment with, and as Chief Financial Officer of, Air Wisconsin effective September 5, 2025.

(9)This amount reflects a discretionary cash bonus that was earned by Mr. Mackay for performance in 2024, which was paid in June 2025.

(10)This amount reflects a discretionary cash bonus that was earned by Mr. Mackay for performance in 2023, $121,000 of which was paid in March of 2024 and the balance of which was deferred and forfeited when Mr. Mackay resigned in September 2025.

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For additional information, please refer to the sections titled "*Elements of Compensation Program – Discretionary Cash Bonus*" and "*—Employment Agreements,*" in this Annual Report.

**Outstanding Equity Awards**

As of December 31, 2024, none of our named executive officers held any outstanding equity awards to acquire shares of Harbor's common stock.

**ITEM 12.&nbsp;&nbsp;&nbsp;&nbsp; SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS** 

**Equity Compensation Plan Information**

We do not have any equity incentive plans, whether or not approved by our stockholders, pursuant to which any equity awards have been or may be issued to our directors, executive officers or employees.

**Security Ownership of Certain Beneficial Owners and Management**

The following table sets forth certain information regarding the beneficial ownership of Harbor's outstanding common stock as of March 11, 2026, by: (i) each of our directors; (ii) each of our named executive officers; (iii) all of our executive officers and directors as a group; and (iv) all those known to us to be beneficial owners of more than five percent of Harbor's outstanding common stock.

Beneficial ownership is determined in accordance with SEC rules and includes voting or investment power with respect to the securities. Shares of common stock that may be acquired by an individual or group within 60 days of March 11, 2026, including upon the conversion, exchange or exercise of securities convertible for, or exchangeable or exercisable into, shares of Harbor's common stock, are deemed to be outstanding for the purpose of computing the percentage ownership of each stockholder.

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| | | |
|:---|:---|:---|
| | **Beneficial Ownership**<sup>(1)</sup>  | **Beneficial Ownership**<sup>(1)</sup>  |
| | **Number of<br>Shares** | **Percentage**  |
| **Greater than 5% Stockholders** | | |
| Amun LLC | 20000000 | 34.2% |
| Southshore Aircraft Holdings, LLC<sup>(2)</sup> | 16500000 | 28.2% |
| **Named Executive Officers and Directors** |  |  |
| Christine R. Deister |  |  |
| Robert Binns<sup>(3)</sup> |  |  |
| Liam Mackay<sup>(4)</sup> |  |  |
| Kevin J. Degen |  |  |
| Nolan Bederman |  |  |
| Richard A. Bartlett<sup>(5)</sup> | 36500000 | 62.4% |
| All executive officers and directors as a group (7 persons) | 36500000 | 62.4% |

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__________

(1)Unless otherwise indicated in the footnotes to this table, and subject to community property laws where applicable, we believe that each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. Applicable percentages are based on 58,429,836 shares of Harbor's common stock outstanding as of March 11, 2026.

(2)The address of each stockholder listed is 5601 W. Grande Market Drive, Suite C, Appleton, Wisconsin, 54913.

(3)In January 2020, Harbor issued 4,000,000 shares of Series C Preferred to Southshore Aircraft Holdings, LLC ("Southshore"). In June 2024, 754,550 shares of the Series C Preferred were converted into 16,500,000 shares of Harbor's common stock. and the remaining 3,245,450 shares of the Series C Preferred were redeemed for an aggregate cash payment of $10,709,985. After giving effect to such conversion and redemption, no shares of the

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Series C Preferred are outstanding. In addition, as of March 11, 2026, there were no securities outstanding that were convertible into, or exercisable or exchangeable for, shares of Harbor's common stock. For additional information, please refer to the section titled "*Commitments and Contractual Obligations*" in Item 7, "*Management's Discussion and Analysis of Financial Condition and Results of Operations*," in this Annual Report.

(4)In connection with the Aviation Disposition, Mr. Binns resigned as President and Chief Executive Officer of Air Wisconsin effective January 9, 2026.

(5)Mr. Mackay resigned his employment with, and as Chief Financial Officer of, Air Wisconsin effective September 5, 2025.

(6)Includes (i) 20,000,000 shares of Harbor's common stock held by Amun and (ii) 16,500,000 shares of Harbor's common stock held by Southshore (see footnote 3 above). Mr. Bartlett, one of Harbor's directors, may be deemed to be the beneficial owner of the shares of Harbor's common stock held by Amun due to his status as a member of the board of managers of Amun, and his indirect ownership of 25.6% of the outstanding equity interests of Amun. However, Mr. Bartlett does not control voting or investment decisions made by Amun, which are made by the board of managers of Amun. Mr. Bartlett disclaims beneficial ownership of the shares held by Amun except to the extent of his pecuniary interest therein. In addition, Mr. Bartlett may be deemed to be the beneficial owner of the shares of common stock held by Southshore due to his status as a member of the board of managers of Southshore and his indirect ownership of 25.6% of the outstanding equity interests of Southshore. However, Mr. Bartlett does not control voting or investment decisions made by Southshore, which are made by the board of managers of Southshore. Mr. Bartlett disclaims beneficial ownership of the shares held by Southshore except to the extent of his pecuniary interest therein.

**ITEM 13.&nbsp;&nbsp;&nbsp;&nbsp; CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE** 

**Certain Relationships and Related Transactions** 

Other than the transactions discussed below, and the various compensation arrangements described in the section titled "*Executive Compensation*" in this Annual Report, since January 1, 2022, there was not, and there is not currently proposed, any transaction or series of similar transactions to which we were or are expected to be a party for which the amount involved exceeds or is expected to exceed $120,000, and in which any director, executive officer, holder of more than 5% of Harbor's common stock, or any member of the immediate family of any of the foregoing, had or will have a direct or indirect material interest.

**Transactions with Amun LLC and Resource Holdings Associates** 

Since January 2012, Amun has provided AWAC and Air Wisconsin with financial advisory and management services pursuant to a Stock Purchase Agreement entered into with Amun in January 2012. In accordance with that agreement, AWAC has paid a recurring monthly fee of $20,000. Amun assigned the payment of these fees to Resource Holdings Associates ("Resource Holdings"). AWAC paid an aggregate of $240,000 to Resource Holdings for each of the years ended December 31, 2024 and December 31, 2023. In June 2021, Harbor's board of directors agreed to pay Resource Holdings a recurring monthly fee of $12,500, effective April 1, 2021, which is in addition to the amount paid to Resource Holdings by AWAC. Harbor paid an aggregate of $150,000 to Resource Holdings for each of the years ended December 31, 2024 and December 31, 2023.

Amun is owned and controlled by individuals who are current or former directors, managers and/or employees of the Company or its subsidiaries. Richard A. Bartlett, one of the Company's directors, indirectly holds 25.6% of the outstanding equity interests of Amun. Geoffrey T. Crowley, who formerly served as a director of AWAC and was an employee of Air Wisconsin, directly holds 12.4% of the outstanding equity interests of Amun. William P. Jordan and Patrick J. Thompson, each of whom was formerly employed by Air Wisconsin, each directly hold 12.4% of the outstanding equity interests of Amun.

Resource Holdings is owned and controlled by individuals who are current or former directors, managers and/or employees of the Company or its subsidiaries. Richard A. Bartlett, one of the Company's directors, indirectly holds 33.3% of the outstanding equity interests of Resource Holdings.

**Transactions with Southshore Aircraft Holdings, LLC**

In January 2020, Harbor issued 4,000,000 shares of Series C Preferred to Southshore. In June 2024, 754,550 shares of the Series C Preferred were converted into 16,500,000 shares of Harbor's common stock. and the remaining 3,245,450

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shares of the Series C Preferred were redeemed for an aggregate cash payment of $10,709,985. For additional information, please refer to the section titled "*Commitments and Contractual Obligations*" in Item 7, *Management's Discussion and Analysis of Financial Condition and Results of Operations*, in this Annual Report.

**Indemnification Agreements** 

The Company's amended and restated certificate of incorporation compels indemnification of its directors to the extent permitted by the Delaware General Corporation Law (the "DGCL"), and its amended and restated bylaws provide for indemnification of the Company's directors, officers, employees and other agents to the maximum extent permitted by the DGCL. In addition, the Company has entered into indemnification agreements with its directors and Chief Executive Officer containing provisions which are in some respects broader than the specific indemnification provisions contained in the DGCL. The indemnification agreements may require the Company, among other things, to indemnify its directors and officers against certain liabilities that may arise by reason of their status or service as directors and officers and to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified.

**Board of Directors and Director Independence** 

Harbor's board of directors is presently comprised of three members. While the Company does not have a class of securities listed on a national securities exchange, Harbor's board of directors believes it is good corporate governance practice to assess whether certain directors would qualify as "independent directors" for purposes of the Nasdaq Listing Rules (the "Nasdaq Rules"). Harbor's board of directors has considered the current "independent director" standards set forth in the Nasdaq Rules and has affirmatively determined that each of Messrs. Bederman and Degen do not have a relationship with the Company that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and therefore qualify as "independent directors" under the Nasdaq Rules. Accordingly, a majority of the members of Harbor's board of directors and each of the members of the Audit Committee qualify as "independent directors" as defined in the Nasdaq Rules.

**Board Leadership Structure** 

Harbor's board of directors has not appointed a Chairman of the Board or a Lead Independent Director although it retains the discretion to do so. Harbor's board of directors believes this is the most appropriate leadership structure at this time given the current number of directors and the scope of the Company's business and operations.

**Board Role in Risk Oversight** 

Harbor's board of directors provides oversight with respect to our management of risk, both as a whole and through the Audit Committee. Harbor's board of directors typically reviews and discusses with management at each of its regular meetings information presented by management relating to our financial and operational results and outlook, including risks related to our business and operations. The Audit Committee oversees the management of risk as part of its responsibilities related to the oversight of the Company's independent registered public accounting firm and the review of the Company's financial results and internal control over financial reporting.

**ITEM 14.&nbsp;&nbsp;&nbsp;&nbsp; PRINCIPAL ACCOUNTANT FEES AND SERVICES** 

**Audit and Non-Audit Fees** 

The following table represents aggregate fees billed to us for services related to the years ended December 31, 2024 and December 31, 2023 by Grant Thornton, LLP, our independent registered public accounting firm:

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| | | |
|:---|:---|:---|
| | Year Ended<br>December 31, | Year Ended<br>December 31, |
| | 2024 | 2023 |
| Audit Fees<sup>(1)</sup> | $659397 | $903273 |
| Audit-Related Fees<sup>(2)</sup> |  |  |
| Tax Fees<sup>(3)</sup> | 10452 | 20163 |
| All Other Fees<sup>(4)</sup> |  |  |
| Total Fees | $669849 | $923436 |

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(1)Consists of fees for professional services rendered in connection with the audit of our consolidated financial statements in this Annual Report, review of our quarterly financial statements, and services that are normally provided in connection with statutory and regulatory filings or engagements.

(2)Consists of fees for professional services for assurance and related services that are reasonably related to the performance of the audit of our financial statements and are not reported as Audit Fees, including audits of employee benefit plans and special procedures required to meet certain regulatory requirements.

(3)Consists of fees for professional services for tax compliance, tax advice and tax planning.

(4)Consists of fees for permitted professional services other than the services reported above.

**Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm**

The Audit Committee pre-approves all audit and permissible non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services, internal control services, tax services and other services. The Audit Committee has adopted a policy for the pre-approval of services provided by our independent registered public accounting firm. The policy generally pre-approves specified services in the defined categories of audit services, audit-related services and tax services up to specified amounts. Pre-approval may also be given as part of the Audit Committee's approval of the scope of the engagement of the independent registered public accounting firm or on a case-by-case basis before the independent registered public accounting firm is engaged to provide each service.

During the year, circumstances may arise when it may become necessary to engage the independent registered public accounting firm for additional services not contemplated in the original pre-approval. In those instances, the Audit Committee requires specific pre-approval before engaging the independent registered public accounting firm.

For the year ended December 31, 2024, all audit and non-audit services provided by the independent registered public accounting firm were pre-approved.

The Audit Committee has determined that the rendering of the non-audit services described above by Grant Thornton LLP is compatible with maintaining the auditor's independence.

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**PART IV** 

**ITEM 15.&nbsp;&nbsp;&nbsp;&nbsp; EXHIBITS AND FINANCIAL STATEMENT SCHEDULES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)The following documents are filed as part of this Annual Report:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*1.Consolidated Financial Statements* 

The financial statements filed as part of this Annual Report are listed in the "Index to Consolidated Financial Statements" under Part II, Item 8, *Financial Statements and Supplementary Data*, of this Annual Report and are incorporated by reference herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.Financial Statement Schedules* 

All schedules are omitted as the information is not required or is inapplicable, or the required information is presented in the consolidated financial statements or notes to the audited consolidated financial statements in this Annual Report.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.Exhibits* 

The exhibits listed below are filed or furnished as part of this Annual Report as indicated in the footnotes to the Exhibit Index.

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**EXHIBIT INDEX** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** |
|<br>**Exhibit<br>Number** | **Exhibit Description** | **Form** | **File No.** | **Exhibit** | **Filing Date** |
| 3.1 | <u>[Amended and Restated Certificate of Incorporation of Harbor Diversified, Inc. (as amended through December 31, 2019).](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex31.htm)</u> | 10-K | 001-34584 | 3.1 | July 10, 2020 |
| 3.2 | <u>[Certificate of Designations, Preferences and Rights of Series C Convertible Redeemable Preferred Stock of Harbor Diversified, Inc.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex32.htm)</u> | 10-K | 001-34584 | 3.2 | July 10, 2020 |
| 3.3 | <u>[Amended and Restated Bylaws of Harbor Diversified, Inc. (a Delaware Corporation) (as amended through December 31, 2019).](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex33.htm)</u> | 10-K | 001-34584 | 3.3 | July 10, 2020 |
| 4.1\* | <u>[Description of Capital Stock of Harbor Diversified, Inc.](hrbr-20241231x10kxex41.htm)</u> |  |  |  |  |
| 4.2 | <u>[Specimen Stock Certificate for Common Stock of Harbor Diversified, Inc.](https://www.sec.gov/Archives/edgar/data/899394/000119312522090061/d333180dex42.htm)</u> | 10-K | 001-34584 | 4.2 | March 30, 2022 |
| 10.1# | <u>[Form of Indemnification Agreement.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex101.htm)</u> | 10-K | 001-34584 | 10.1 | July 10, 2020 |
| 10.2.1# | <u>[Employment Agreement, dated March 20, 2019, between Air Wisconsin Airlines LLC and Robert Binns](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex103.htm)</u> | 10-K | 001-34584 | 10.3 | July 10, 2020 |
| 10.2.2# | <u>[First Amendment to Employment Agreement, dated March 29, 2021, between Air Wisconsin Airlines LLC and Robert Binns](https://www.sec.gov/Archives/edgar/data/899394/000119312521103375/d159175dex1032.htm)</u> | 10-K | 001-34584 | 10.3.2 | April 1, 2021 |
| 10.3# | <u>[Employment Agreement, dated January 1, 2021, between Air Wisconsin Airlines LLC and Liam Mackay.](https://www.sec.gov/Archives/edgar/data/899394/000119312521103375/d159175dex104.htm)</u> | 10-K | 01-34584 | 10.4 | April 1, 2021 |
| 10.4.1+† | <u>[Capacity Purchase Agreement, dated February 26, 2017, between United Airlines, Inc. and Air Wisconsin Airlines LLC.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1041.htm)</u> | 10-K | 001-34584 | 10.4.1 | July 10, 2020 |
| 10.4.2 | <u>[Letter, dated March 31, 2020, from United Airlines, Inc. to Air Wisconsin Airlines LLC.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1042.htm)</u> | 10-K | 001-34584 | 10.4.2 | July 10, 2020 |
| 10.4.3+† | <u>[First Amendment to Capacity Purchase Agreement, dated October 14, 2020, between United Airlines, Inc., Air Wisconsin Airlines LLC, AWAC Aviation, Inc., and Harbor Diversified, Inc.](https://www.sec.gov/Archives/edgar/data/899394/000119312521103375/d159175dex1053.htm)</u> | 10-K | 001-34584 | 10.5.3 | April 1, 2021 |
| 10.4.4† | <u>[Second Amendment to Capacity Purchase Agreement, dated April 23, 2021, between United Airlines, Inc. and Air Wisconsin Airlines LLC.](https://www.sec.gov/Archives/edgar/data/899394/000119312521163839/d320594dex103.htm)</u> | 10-Q | 001-34584 | 10.3 | May 17, 2021 |
| 10.4.5† | <u>[Sixth Amendment to Capacity Purchase Agreement, dated February 10, 2023, between United Airlines, Inc. and Air Wisconsin Airlines LLC.](https://www.sec.gov/ix?doc=/Archives/edgar/data/0000899394/000119312523088392/d443202d10k.htm)</u> | 10-K | 001-34584 | 10.4.5 | April 3, 2023 |
| 10.5.1 | <u>[Payroll Support Program Agreement, dated April 20, 2020, between Air Wisconsin Airlines LLC and the Department of the Treasury.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex107.htm)</u> | 10-K | 001-34584 | 10.7 | July 10, 2020 |
| 10.5.2 | <u>[Payroll Support Program Extension Agreement, dated March 23, 2021, between Air Wisconsin Airlines LLC and the Department of the Treasury.](https://www.sec.gov/Archives/edgar/data/899394/000119312521103375/d159175dex1082.htm)</u> | 10-K | 001-34584 | 10.8.2 | April 1, 2021 |
| 10.5.3 | <u>[Payroll Support Program 3 Agreement, dated June 1, 2021, between Air Wisconsin Airlines LLC and the Department of the Treasury.](https://www.sec.gov/Archives/edgar/data/899394/000119312522090061/d333180dex1083.htm)</u> | 10-K | 001-34584 | 10.8.3 | March 30, 2022 |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** |
|<br>**Exhibit<br>Number** | **Exhibit Description** | **Form** | **File No.** | **Exhibit** | **Filing Date** |
| 10.6.1 | <u>[Restructuring Agreement, dated January 25, 2018, among Air Wisconsin Airlines LLC, the Lender, the Subordinated Note Holder, U.S. Bank National Association and Investissement Quebec.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1081.htm)</u> | 10-K | 001-34584 | 10.8.1 | July 10, 2020 |
| 10.6.2 | <u>[Form of Amended and Restated Credit Agreement, dated December 24, 2018, among Air Wisconsin Airlines LLC, U.S. Bank National Association and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1082.htm)</u> | 10-K | 001-34584 | 10.8.2 | July 10, 2020 |
| 10.7.1 | <u>[Credit Agreement, dated June 5, 2017, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1091.htm)</u> | 10-K | 001-34584 | 10.9.1 | July 10, 2020 |
| 10.7.2 | <u>[Amendment No. 1 to Credit Agreement, dated December 24, 2018, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1092.htm)</u> | 10-K | 001-34584 | 10.9.2 | July 10, 2020 |
| 10.7.3 | <u>[Credit Agreement, dated January 25, 2018, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1093.htm)</u> | 10-K | 001-34584 | 10.9.3 | July 10, 2020 |
| 10.7.4 | <u>[Amendment No. 1 to Credit Agreement, dated December 24, 2018, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1094.htm)</u> | 10-K | 001-34584 | 10.9.4 | July 10, 2020 |
| 10.7.5 | <u>[Amendment No. 2 to Credit Agreement, dated April 24, 2019, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1095.htm)</u> | 10-K | 001-34584 | 10.9.5 | July 10, 2020 |
| 10.7.6 | <u>[Amendment No. 3 to Credit Agreement, dated June 20, 2019, between Air Wisconsin Airlines LLC and the Lender.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex1096.htm)</u> | 10-K | 001-34584 | 10.9.6 | July 10, 2020 |
| 10.8† | <u>[Capacity Purchase Agreement, dated August 19, 2022, between American Airlines, Inc. and Air Wisconsin Airlines LLC.](https://www.sec.gov/Archives/edgar/data/899394/000119312522290070/d392716dex101.htm)</u> | 10-Q | 001-34584 | 10.10 | November 21, 2022 |
| 10.8.1† | <u>[Amendment No. 1 to Capacity Purchase Agreement, dated February 23, 2023, between American Airlines, Inc. and Air Wisconsin Airlines LLC](https://www.sec.gov/ix?doc=/Archives/edgar/data/0000899394/000119312523145144/d424549d10q.htm)</u> | 10-Q | 001-34584 | 10.10.1 | May 15, 2023 |
| 10.8.2+† | <u>[Amendment No. 3 to Capacity Purchase Agreement, dated November 10, 2023, between American Airlines Inc. and Air Wisconsin Airlines LLC](https://www.sec.gov/ix?doc=/Archives/edgar/data/0000899394/000089939424000006/hrbr-20231231.htm)</u> | 10-K | 001-34584 | 10.10.2 | October 24, 2024 |
| 10.8.3+† | <u>[Amendment No. 4 to Capacity Purchase Agreement, dated November 27, 2024, between American Airlines Inc. and Air Wisconsin Airlines LLC](https://www.sec.gov/ix?doc=/Archives/edgar/data/0000899394/000119312524271586/d902380d8k.htm)</u> | 10-K | 001-34584 | 10.10.3 | December 5, 2024 |
| 10.9\*+† | <u>[Membership Interest Purchase Agreement, dated December 10, 2025, between AWAC Aviation, Inc., Harbor Diversified Inc. and CSI Aviation, Inc.](hrbr-20241231x10kxex109.htm)</u> |  |  |  |  |
| 10.10\*+† | <u>[S](hrbr-20241231x10kxex1010.htm)[ale and Purchase Agreement,](hrbr-20241231x10kxex1010.htm)[dated December 10, 2025](hrbr-20241231x10kxex1010.htm)[,](hrbr-20241231x10kxex1010.htm)[between](hrbr-20241231x10kxex1010.htm)[Harbor Diversified, Inc. and CSI Aviation, Inc.](hrbr-20241231x10kxex1010.htm)</u> |  |  |  |  |
| 10.11\*+† | <u>[Sale and Purchase Agreement](hrbr-20241231x10kxex1011.htm)[, dated December 15, 2025, between Harbor Diversified, Inc. and](hrbr-20241231x10kxex1011.htm)[UMB Bank as Trustee for Associated Lease and Finance Group, LLC](hrbr-20241231x10kxex1011.htm)</u> |  |  |  |  |
| 14.1 | <u>[Code of Business Conduct and Ethics for Senior Financial Officers.](https://www.sec.gov/Archives/edgar/data/899394/000119312520191135/d926157dex141.htm)</u> | 10-K | 001-34584 | 14.1 | October 24, 2024 |
| 19.1 | <u>[Trading Restriction Policy](https://www.sec.gov/ix?doc=/Archives/edgar/data/0000899394/000089939424000006/hrbr-20231231.htm)</u> | 10-K | 001-34584 | 19.1 | July 10, 2020 |
| 21.1\* | <u>[List of Subsidiaries of Harbor Diversified, Inc.](hrbr-20241231x10kxex211.htm)</u> |  |  |  |  |
| 24.1\* | <u>Power of Attorney (included on the signature page hereto).</u> |  |  |  |  |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** | **INCORPORATED BY REFERENCE** |
|<br>**Exhibit<br>Number** | **Exhibit Description** | **Form** | **File No.** | **Exhibit** | **Filing Date** |
| 31.1\* | <u>[Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](hrbr-20241231xex311.htm)</u> |  |  |  |  |
| 31.2\* | <u>[Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](hrbr-20241231xex312.htm)</u> |  |  |  |  |
| 32.1\*\* | <u>[Certifications of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](hrbr-20241231xex321.htm)</u> |  |  |  |  |
| 101.INS\* | XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). |  |  |  |  |
| 101.SCH\* | XBRL Taxonomy Extension Schema Document. |  |  |  |  |
| 101.CAL\* | XBRL Taxonomy Extension Calculation Linkbase Document. |  |  |  |  |
| 101.DEF\* | XBRL Taxonomy Extension Definition Linkbase Document. |  |  |  |  |
| 101.LAB\* | XBRL Taxonomy Extension Label Linkbase Document. |  |  |  |  |
| 101.PRE\* | XBRL Taxonomy Extension Presentation Linkbase Document. |  |  |  |  |
| 104\* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |  |  |  |  |

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\*Filed herewith.

\*\*The certifications attached as Exhibit 32.1 accompany this Annual Report pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed "filed" by the registrant for purposes of Section 18 of the Exchange Act and are not to be incorporated by reference into any of the registrant's filings under the Securities Act or the Exchange Act, irrespective of any general incorporation language contained in any such filing.

#Management contract or compensatory plan, contract or arrangement.

+Certain schedules are omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant agrees to furnish supplementally any omitted schedules to the SEC upon request.

†Certain confidential portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The registrant has determined that such redacted information is (i) not material, and (ii) would likely cause competitive harm to the registrant if publicly disclosed. The registrant agrees to furnish supplementally an unredacted copy of the exhibit to the SEC upon request.

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**ITEM 16.&nbsp;&nbsp;&nbsp;&nbsp; FORM 10-K SUMMARY** 

Information with respect to this Item is not required and has been omitted.

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**SIGNATURES** 

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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| | | |
|:---|:---|:---|
| | **HARBOR DIVERSIFIED, INC.** | **HARBOR DIVERSIFIED, INC.** |
| Date: April 8, 2026 | By: | */s/ Christine R. Deister* |
|  |  | Christine R. Deister |
|  |  | Chief Executive Officer and Secretary |
|  |  | Harbor Diversified, Inc. |
|  |  | *(Principal Executive Officer)* |

---

**POWER OF ATTORNEY** 

KNOW ALL PERSONS BY THESE PRESENTS, that each individual whose signature appears below hereby constitutes and appoints Christine R. Deister and Gregg Garvey, and each or either of them, acting individually, as his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report, and to file the same, with all exhibits thereto and other documents in connection therewith, with the SEC, granting unto said attorney-in-fact and agent, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or any of them, or their or his or her substitutes, may lawfully do or cause to be done or by virtue hereof.

Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated.

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| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| */s/ Christine R. Deister* | Chief Executive Officer and Secretary, <br>Harbor Diversified, Inc.<br>*(Principal Executive Officer)* | April 8, 2026 |
| Christine R. Deister | Chief Executive Officer and Secretary, <br>Harbor Diversified, Inc.<br>*(Principal Executive Officer)* |  |
| */s/ Gregg Garvey* | Executive Vice President, Chief Financial Officer, and Treasurer, Harbor Diversified, Inc.<br>*(Principal Financial and Accounting Officer)* | April 8, 2026 |
| Gregg Garvey | Executive Vice President, Chief Financial Officer, and Treasurer, Harbor Diversified, Inc.<br>*(Principal Financial and Accounting Officer)* |  |
| */s/ Richard A. Bartlett* | Director, Harbor Diversified, Inc. | April 8, 2026 |
| Richard A. Bartlett |  |  |
| */s/ Nolan Bederman* | Director, Harbor Diversified, Inc. | April 8, 2026 |
| Nolan Bederman |  |  |
| */s/ Kevin J. Degen* | Director, Harbor Diversified, Inc. | April 8, 2026 |
| Kevin J. Degan |  |  |

---

## Exhibit 4.1

**Exhibit 4.1**

**DESCRIPTION OF CAPITAL STOCK**

The following is a summary of characteristics of the capital stock of Harbor Diversified, Inc., as set forth in our Amended and Restated Certificate of Incorporation, as amended (the "Charter"), and our Amended and Restated Bylaws, as amended (the "Bylaws"). The summary does not purport to be complete and is subject to and qualified in its entirety by reference to our Charter, a copy of which has been filed as Exhibit 3.1 to the Annual Report, and to our Bylaws, a copy of which has been filed as Exhibit 3.3 to the Annual Report. Please refer to our Charter and Bylaws, and to the applicable provisions of the Delaware General Corporation Law (the "DGCL"), for additional information.

References to "we," "us," "our" or the "Company" refer to Harbor Diversified, Inc. Unless indicated otherwise, all information is provided as of the date of filing of the Annual Report on Form 10-K (the "Annual Report") to which this document is filed as an exhibit.

**General**

Our authorized capital stock consists of 100,000,000 shares of common stock, par value $0.01 per share ("common stock"), and 10,000,000 shares of preferred stock, par value $0.01 per share ("preferred stock"), of which (i) 2,000,000 shares were designated Series A Preferred Stock (the "Series A Preferred"), (ii) 300,000 shares were designated Series B Junior Participating Preferred Stock ("Series B Preferred"), and (iii) 4,000,000 shares were designated Series C Convertible Redeemable Preferred Stock ("Series C Preferred").

**Common Stock**

Our Charter authorizes the issuance of up to 100,000,000 shares of common stock. All outstanding shares of our common stock are validly issued, fully paid and nonassessable. As of December 31, 2025, there were 71,981,140 shares of our common stock issued, and 58,493,761 shares of our common stock outstanding.

The holders of our common stock are entitled to one vote per share on all matters submitted to a vote of stockholders and our Charter does not provide for cumulative voting in the election of directors. Subject to preferences that may be applicable to any outstanding series of preferred stock, the holders of our common stock will receive ratably any dividends declared by our board of directors out of funds legally available for the payment of dividends. In the event of our liquidation, dissolution or winding-up, the holders of our common stock are entitled to share ratably in all assets remaining after payment of or provision for any liabilities, subject to prior distribution rights of preferred stock, if any, then outstanding.

Our common stock is not entitled to preemptive rights, and is not subject to redemption. There are no sinking fund provisions applicable to our common stock. Our common stock is not convertible into any other shares of our capital stock.

**Preferred Stock**

Pursuant to the terms of our Charter, our board of directors was initially authorized, subject to limitations prescribed by the DGCL, to issue up to 10,000,000 shares of preferred stock in one or more series, to establish from time to time the number of shares to be included in each series, and to fix the designation, powers, preferences and rights of the shares of each series and any of its qualifications, limitations or restrictions, in each case without further action by our stockholders.

As of December 31, 2025, (i) all 2,000,000 shares of the Series A Preferred have been converted into shares of our common stock and may not be reissued as authorized shares of preferred stock, (ii) all 300,000 shares of the

------

Series B Preferred remain authorized as none have been issued, and (iii) all 4,000,000 shares of the Series C Preferred have been converted into shares of our common stock and/or redeemed for cash and were returned to the pool of authorized but unissued shares of preferred stock. Please refer to the section titled "--*Series C Convertible Redeemable Preferred Stock* for additional information.

As a result of the prior conversion of 2,000,000 shares of the Series A Preferred, and the determination that such shares may not be reissued as authorized shares of preferred stock, our board of directors continues to be authorized to issue up to 8,000,000 shares of preferred stock.

***Series C Convertible Redeemable Preferred Stock***

On January 17, 2020, we filed a Certificate of Designations, Preferences, and Rights of Series C Convertible Redeemable Preferred Stock (the "Certificate of Designations") with the Secretary of State of the State of Delaware, establishing the rights, preferences, privileges, qualifications, restrictions and limitations relating to 4,000,000 shares of the Series C Preferred. The Series C Preferred ranked senior to our common stock and any other class or series of capital stock, with respect to rights to dividends, distributions, redemptions and payments upon the liquidation, dissolution and winding up of the Company. Holders of the Series C Preferred had the right to vote with holders of our common stock on an as-converted basis on all matters, subject to such limitations as set forth in the Certificate of Designations. Each share of the Series C Preferred was convertible at the option of its holder into shares of our common stock. The number of shares of our common stock that the Series C Preferred was convertible was determined by dividing the Series C Liquidation Amount by the Conversion Price on the date of conversion. The Conversion Price was initially $0.80, subject to adjustment. The Conversion Price was subsequently adjusted to be $0.15091 consistent with the terms of the Certificate of Designations. The Series C Liquidation Amount was initially equal to $3.30, subject to adjustment, plus all accrued but unpaid Preferential Dividends, Conversion Cap Excess Dividends, and any other accrued but unpaid dividends on such share of Series C Preferred. The Series C Preferred was convertible into a maximum of 16,500,000 shares of our common stock.

On June 28, 2024, 754,550 shares of Series C Preferred were converted into 16,500,000 shares of our common stock, and the remaining 3,245,450 shares (i.e., Conversion Cap Excess Shares) were redeemed for $10,710,000. As a result of the conversion and redemption, no shares of Series C Preferred were outstanding as of December 31, 2025.

Capitalized terms used but not defined in this section have the meanings given to them in the Certificate of Designations, which is filed as Exhibit 3.2 to the Annual Report.

**Warrants**

We have not issued any warrants to acquire shares of our common stock or other shares of our capital stock.

**Stock Options** 

We have not issued any stock options or other equity awards to acquire shares of our common stock or other shares of our capital stock. We have not adopted an equity incentive plan or stock option plan (or similar plan) although we reserve the right to adopt this type of plan in the future.

**Limitations on Director and Officer Liability**

The DGCL authorizes corporations to limit or eliminate the personal liability of officers and directors to corporations and their stockholders for monetary damages for breaches of directors' fiduciary duties. Our Charter and Bylaws include provisions that eliminate, to the extent allowable under the DGCL, the personal liability of

------

officers and directors for monetary damages for actions taken as a director or officer, as the case may be. Our Charter and Bylaws also provide that we must indemnify and advance reasonable expenses to our directors and officers to the fullest extent authorized by the DGCL.

The DGCL's limitation on the elimination of director liability is generally unavailable for acts or omissions by a director which (i) were not in good faith, (ii) were the result of intentional misconduct or a knowing violation of law, (iii) result in a director deriving an improper personal benefit (such as a financial profit or other advantage to which the director was not legally entitled), or (iv) breached the director's duty of loyalty. The DGCL also prohibits limitations on director liability under Section 174 of the DGCL, which relates to certain unlawful dividend declarations and stock repurchases.

We maintain insurance that insures our directors and officers against certain losses and which insures us against our obligations to indemnify the directors and officers. We have also entered into indemnification agreements with our directors and executive officer, the form of which has been filed as Exhibit 10.1 to the Annual Report.

The limitation of liability and indemnification provisions in our Charter and Bylaws may discourage stockholders from bringing a lawsuit against officers and directors for breach of their fiduciary duty. These provisions may also have the effect of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise benefit the Company and our stockholders. In addition, an investment in our common stock may be adversely affected to the extent that we pay the costs of settlement and damages awards against officers and directors pursuant to these indemnification provisions.

**Provisions of Our Charter and Bylaws and Delaware Law That May Have an Anti-Takeover Effect**

Provisions of the DGCL, and our Charter and Bylaws, could make it more difficult to acquire the Company by means of a tender offer, a proxy contest or otherwise, or to remove incumbent officers and directors. These provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of the Company to first negotiate with our board of directors. We believe that the benefits of these provisions outweigh the disadvantages of discouraging certain takeover or acquisition proposals because, among other things, negotiation of these proposals could result in an improvement of their terms and enhance the ability of our board of directors to maximize stockholder value. However, these provisions may delay, deter or prevent a merger or acquisition of the Company that a stockholder might consider is in its best interest, including those attempts that might result in a premium over the prevailing market price of our common stock.

***Advance Notification of Stockholder Meetings***

Our Bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors. In order for any matter to be properly brought before a stockholder meeting, a stockholder must comply with advance notice procedures and provide us with certain information. Our Bylaws allow our board to adopt rules and regulations for the conduct of stockholder meetings which may have the effect of precluding the conduct of certain business at a meeting if such rules and regulations are not followed.

***Special Stockholder Meetings***

Our Bylaws provide that special meetings of the stockholders may be called only by the chairman of our board, the chief executive officer, a majority of our board or the written request of holders of at least 25% of the voting power of the then-outstanding shares of voting stock of the Company, entitled to vote at an election of

------

directors. Our Bylaws prohibit the conduct of any business at a special meeting other than as specified in the notice for such meeting.

***No Cumulative Voting***

The DGCL provides that a stockholder's right to vote cumulatively in the election of directors does not exist unless the certificate of incorporation specifically provides otherwise. Our Charter does not provide for cumulative voting.

***Size of Board and Vacancies***

Our Charter and Bylaws provide that the exact number of directors is fixed exclusively by our board of directors. Newly created directorships resulting from any increase in our authorized number of directors, and any vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, will generally be filled by a majority of our board of directors then in office, although such vacancies may also be filled by the affirmative vote of the holders of a majority of the voting power of the then-outstanding shares of voting stock of the Company, entitled to vote at an election of directors.

***Authorized but Unissued Shares***

Our authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval. We may use additional shares for a variety of corporate purposes, including one or more investments or acquisitions, raising additional capital, the adoption of equity incentive plans, or other strategic purposes. As discussed above, our board of directors has the authority to determine the number of authorized shares, and to fix the designation, powers, preferences and rights, of each series of preferred stock, in each case without stockholder approval. The existence of authorized but unissued shares of common stock and preferred stock could render more difficult or discourage an attempt to obtain control of the Company by means of a proxy contest, tender offer, merger or otherwise.

***Five-Percent Stockholder Transfer Restrictions***

Our Charter generally restricts any direct or indirect transfers of our common stock if the effect would be to (i) increase the direct or indirect ownership of our common stock by any person or group from less than 5.0% to 5.0% or more of our common stock; or (ii) increase the percentage of our common stock owned directly or indirectly by a person or group owning or deemed to own 5.0% or more of our common stock.

**Exclusive Forum Clause**

Our Bylaws provide that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the sole and exclusive forum for any stockholder (including any beneficial owner) to bring (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, or employees to the Company or to our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our Charter or Bylaws, or (iv) any action asserting a claim governed by the internal affairs doctrine, will, to the fullest extent permitted by law, be the Court of Chancery of the State of Delaware.

## Exhibit 10.09

**Certain confidential information contained in this document, marked by [\*\*\*], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.**

**MEMBERSHIP INTEREST PURCHASE AGREEMENT**

by and among

**AWAC AVIATION, INC., CSI AVIATION, INC.** 

and

**HARBOR DIVERSIFIED INC. (SOLELY FOR PURPOSES OF SECTION 9.19)**

dated as of

December 10, 2025

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**TABLE OF CONTENTS**

Page

[ARTICLE I DEFINITIONS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[1](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 1.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Definitions](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[1](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE II BASIC TRANSACTION](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[14](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 2.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Purchase and Sale](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[14](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 2.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[CLOSING PAYMENT](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[14](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 2.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[CLOSING PAYMENT ESTIMATE, RECONCILIATION AND PAYMENT](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[15](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 2.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Withholding](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[17](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE SELLER](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[17](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Organization and Authority of the Seller and the](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Company](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[; Enforceability](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[17](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[No Conflicts; Consents](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[18](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Regulatory Obligations](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[18](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Legal Proceedings](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[19](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[CAPITALIZATION; Ownership of MEMBERSHIP INTERESTS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[19](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[FINANCIAL STATEMENTS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[20](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[BOOKS AND RECORDS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[20](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[ABSENCE OF CHANGES](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[20](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.09](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[LIABILITIES AND INDEBTEDNESS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[22](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.10](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[AIRCRAFT AND Rotables](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[22](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.11](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Subsidiaries](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[23](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.12](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Licenses and Permits](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[23](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.13](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Taxes](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[23](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.14](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Compliance with Law](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[26](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.15](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Assets of the Company](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[26](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.16](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[REAL ESTATE](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[26](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.17](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Environmental matters](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[27](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.18](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Employee Benefit plans](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[27](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.19](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Labor and Employment Matters](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[28](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.20](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Material Contracts](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[29](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

[Section 3.21](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Insurance](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[29](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.22](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[INTELLECTUAL PROPERTY](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[30](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.23](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Computer systems and data privacy](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[31](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.24](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Affiliate Transactions](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[32](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.25](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Brokers](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[32](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 3.26](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Exclusivity of Representations and Warranties](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[32](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE BUYER](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[32](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Organization and Authority of the Buyer; Enforceability](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[32](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[No Conflicts; Consents](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[33](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Investment Purpose](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[33](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Brokers](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[33](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Legal Proceedings](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[33](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[FINANCING](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[34](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[COMPLIANCE WITH LAW](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[34](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 4.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[NO OTHER REPRESENTATIONS AND WARRANTIES](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[34](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE V PRE-CLOSING COVENANTS; CLOSING](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[34](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Operation of the Company prior to the Closing](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[34](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Financing Efforts of Buyer](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[35](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Excluded Assets](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[35](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[OTHER PRE-CLOSING COVENANTS.](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[36](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Conditions to Closing](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[36](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[The Seller's Deliveries](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[39](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[The Buyer's Deliveries](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[39](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Closing](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[40](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 5.09](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[No Solicitation of Other Bids](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[40](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE VI ADDITIONAL COVENANTS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[40](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Confidentiality](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[40](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Press Releases](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[41](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Duty to Cooperate and Approvals](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[41](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Tax Matters](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[42](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Restrictive](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[COVENANTS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[45](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[RELEASE](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[46](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

[Section 6.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[D&O TAIL INSURANCE; INDEMNIFICATION](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[46](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Aircraft Insurance.](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[47](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.09](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Employee Matters](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[48](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.10](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Livery](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[48](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 6.11](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Books and Records](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[48](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE VII INDEMNIFICATION](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[49](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Survival](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[49](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Indemnification by the Seller](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[49](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Indemnification by the Buyer](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[50](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Certain Limits](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[50](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Indemnification Procedures; PAYMENTS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[51](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Third-Party Claims](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[52](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Tax Treatment of Indemnification Payments](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[53](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 7.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Exclusive Remedies](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[53](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE VIII TERMINATION](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[53](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 8.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Termination](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[53](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 8.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Effect of Termination](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[54](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[ARTICLE IX MISCELLANEOUS](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[54](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.01](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Expenses](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[54](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.02](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Further Assurances](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[54](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.03](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Disclaimer](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[55](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.04](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Notices](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[55](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.05](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Headings](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[56](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.06](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Severability](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[56](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.07](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Entire Agreement](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[56](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.08](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Successors and Assigns](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[56](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.09](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[No Third-Party Beneficiaries](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[57](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.10](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Amendment and Modification](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[57](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.11](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Non-Waiver](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[57](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.12](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Non-Assertion of Attorney-Client Privilege](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[57](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.13](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Governing Law](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[58](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.14](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Submission to Jurisdiction; Attorneys' Fees](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[58](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

[Section 9.15](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Waiver of Jury Trial](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[58](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.16](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Specific Performance](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[58](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.17](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Counterparts](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[59](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.18](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[Interpretation](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[59](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

[Section 9.19](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[GUARANTEE](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[&nbsp;&nbsp;&nbsp;&nbsp;](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)[59](#ic8968ae7afb942b5bb1038a8e5ce9e57_1)

**<u>Exhibits And Schedules</u>**

Schedule 1.01(a) – Aircraft

Schedule 1.01(b)(i) – Certain Indebtedness

Schedule 1.01(b)(ii) – Assumed Indebtedness &nbsp;&nbsp;&nbsp;&nbsp;

Schedule 1.01(c) – Special Indemnity Matters

Schedule 5.03 – Excluded Assets

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**<u>MEMBERSHIP INTEREST PURCHASE AGREEMENT</u>**

This Membership Interest Purchase Agreement (this "<u>Agreement</u>"), dated as of December 10, 2025 is entered into by and among AWAC Aviation, Inc., a Delaware corporation (the "<u>Seller</u>"), CSI Aviation, Inc., a Texas corporation (the "<u>Buyer</u>"), and, solely for the purposes of Section 9.19, Harbor Diversified Inc., a Delaware corporation (the "<u>Guarantor</u>").

**RECITALS**

**WHEREAS**, the Guarantor owns 100% of the issued and outstanding shares of the Seller, which in turn owns 100% of the issued and outstanding membership interests (the "<u>Membership Interests</u>") of Air Wisconsin Airlines LLC, a Delaware limited liability company (the "<u>Company</u>"), which operates as a Part 121 Certificated Air Carrier (the "<u>Business</u>"); and

**WHEREAS**, the Seller wishes to sell to the Buyer, and the Buyer wishes to purchase from the Seller, the Membership Interests, on and subject to the terms and conditions set forth herein.

**NOW, THEREFORE**, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

**ARTICLE I<br>DEFINITIONS**

**Section 1.01&nbsp;&nbsp;&nbsp;&nbsp;DEFINITIONS.** In addition to the terms defined in the text of this Agreement, the following capitalized words and phrases shall have the meanings set forth below:

"<u>Acceptance Notice</u>" has the meaning set forth in Section 7.05(a).

"<u>Action</u>" means any action, claim, suit, proceeding or governmental audit, subpoena or investigation of any nature, notice, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation, citation, or summons, whether civil, criminal, administrative, regulatory or otherwise, or whether at law or in equity.

"<u>Affiliate(s)</u>" means an entity that directly or indirectly owns or controls, is controlled by, or is under common control with the entity specified.

"<u>Affordable Care Act</u>" means the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, and the guidance and regulations issued thereunder.

"<u>Agreement</u>" has the meaning set forth in the preamble.

"<u>Air Certificates</u>" has the meaning set forth in Section 3.12.

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"<u>Aircraft</u>" means the Airframes and two Engines associated therewith which may not be installed thereon identified in Schedule 1.01(a).

"<u>Airframe</u>" means, individually or collectively, as indicated by context, those certain Bombardier model CL-200 series airframes (excluding the associated Engines), as described in Schedule 1.01(a), together with any and all Parts installed thereon, and with all records relating thereto in the Company's possession.

"<u>Applicable Law</u>" or "<u>Applicable Laws</u>" means any and all laws, ordinances, constitutions, regulations, statutes, treaties, rules, codes, licenses, certificates, franchises, permits, requirements and Injunctions adopted, enacted, implemented, promulgated, issued or entered by or under the authority of any Governmental Authority having jurisdiction over a specified Person or any of such Person's properties or assets.

"<u>Benefit Plan</u>" means each "employee benefit plan" within the meaning of Section 3(3) of ERISA (whether or not subject to ERISA) and all other compensation and benefits plans, policies, trust funds, programs, arrangements or payroll practices, including Multiemployer Plans, and each other stock purchase, stock option, restricted stock, profit sharing, pension, savings, severance, retention, employment, consulting, commission, change-of-control, collective bargaining, bonus, incentive, deferred compensation, loan, fringe benefit, insurance, welfare, post-retirement health or welfare, health, life, tuition refund, service award, company car, scholarship, relocation, disability, accident, sick pay, sick leave, accrued leave, vacation, holiday, termination, unemployment, restrictive covenant, and other benefit plan, policy, trust fund, program, arrangement or payroll practice, whether or not subject to ERISA (including any related funding mechanism now in effect or required in the future), whether formal or informal, oral or written, funded or unfunded, insured or self-insured, in each case, that is sponsored, established, maintained, contributed to or required to be contributed to by either Company, or under which the Company has any current or potential Liability.

"<u>Business</u>" has the meaning set forth in the Recitals.

"<u>Business Day</u>" means any day except Saturday, Sunday or any other day on which commercial banks located in Albuquerque, New Mexico, or New York, New York are authorized or required by Applicable Law to be closed for business.

"<u>Buyer</u>" has the meaning set forth in the preamble.

"<u>Buyer Indemnified Parties</u>" has the meaning set forth in Section 7.02(a).

"<u>Buyer Released Parties</u>" has the meaning set forth in Section 6.06.

"<u>CARES Act</u>" means the Coronavirus Aid, Relief, and Economic Security Act (Pub. L. 116-136) and any administrative or other guidance published with respect thereto by any Governmental Authority.

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"<u>Cash</u>" means Company's cash, cash equivalents, including any marketable securities, restricted cash, insurance receivables (including aircraft-related reimbursements), and worker's compensation receivables (short- and long-term).

"<u>CERCLA</u>" has the meaning set forth in the definition of "Environmental Laws".

"<u>Charter Documents</u>" means, with respect to any particular entity: (a) if a corporation, its articles or certificate of incorporation and bylaws; (b) if a general partnership, its partnership agreement and any statement of partnership; (c) if a limited partnership, the limited partnership agreement and the certificate of limited partnership; (d) if a limited liability company, the articles of organization and operating agreement or limited liability company agreement; (e) if another type of Person, any other charter or similar document adopted or filed in connection with the creation, formation or organization of the Person; (f) all equity holders' agreements, voting agreements, voting trust agreements, joint venture agreements, registration rights agreements or other agreements or documents relating to the organization, management or operation of such entity or relating to the rights, duties and obligations of the equity holders of such entity with respect thereto; and (g) any amendment or supplement to any of the foregoing.

"<u>Citizen of the United States</u>" shall have the same meaning as the definition contained in 49 U.S.C. Section 40102(a)(15) and interpreted by the DOT.

"<u>Claim Notice</u>" has the meaning set forth in Section 7.05(a).

"<u>Closing</u>" has the meaning set forth in Section 5.08.

"<u>Closing Adjustment Amounts</u>" has the meaning set forth in Section 2.03(c)(i).

"<u>Closing Date</u>" has the meaning set forth in Section 5.08.

"<u>Closing Indebtedness</u>" means the amount, as reflected on the Estimated Closing Statement, as such amount may be revised in accordance with the provisions of Section 2.03, determined as of immediately prior to the Closing and without giving effect to the consummation of the transactions contemplated hereby, of the Indebtedness of the Company.

"<u>Closing Payment</u>" has the meaning set forth in Section 2.02.

"<u>Closing Statement</u>" has the meaning set forth in Section 2.03(c)(i).

"<u>Code</u>" means the Internal Revenue Code of 1986, as amended and the regulations promulgated thereunder.

"<u>Company</u>" has the meaning set forth in the Recitals.

"<u>Company Confidential Information</u>" has the meaning set forth in Section 9.12(c).

"<u>Computer Systems</u>" means all computer hardware, servers, networks, platforms, data communication lines, tablets, telephones, peripheral equipment and other electronic devices or

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information technology equipment and related systems, software and firmware, data and related services that are used by or accessible to the Company in the operation of the Business.

"<u>Confidential Information</u>" means, with respect a party hereto, any non-public, confidential or proprietary information provided to the other party in connection with the transactions contemplated hereby, including (a) any other confidentiality agreements or confidential information as determined in any agreements between the Seller and/or any of its Affiliates, on the one hand, and the Buyer and/or any of its Affiliates, on the other hand, (b) the terms of this Agreement and the Related Agreements and (c) any other communications between the parties hereto containing the commercial terms of the transactions contemplated hereby. Confidential Information excludes information that is (i) generally available to and known by the public through no fault of the disclosing party, any of its Affiliates or their respective Representatives; or (ii) lawfully acquired by the disclosing party, any of its Affiliates or their respective Representatives from sources which are not prohibited from disclosing such information by a legal, contractual or fiduciary obligation.

"<u>Copyrights</u>" has the meaning set forth in the definition of "Intellectual Property".

"<u>Current Representation</u>" has the meaning set forth in Section 9.12(a).

"<u>Contract</u>" or "<u>Contracts</u>" means all contracts, leases, deeds, mortgages, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures and all other agreements, commitments and legally binding arrangements, whether written or oral.

"<u>Data Breach</u>" means any (a) unauthorized access, disclosure, use, denial of use, alteration, corruption, destruction, or loss of Personal Information or confidential business information, (b) material failure, breakdown, or interruption of Computer Systems, or (c) other security incident, data breach, or breach of the security that would reasonably be expected to cause a disruption to the conduct of the business of the Company.

"<u>Designated Person</u>" has the meaning set forth in Section 9.12(a).

"<u>DOT</u>" means the United States Department of Transportation.

"<u>Encumbrance</u>" means any charge, claim, community property interest, condition, easement, covenant, commitment, warrant, demand, encumbrance, lien, mortgage, option, purchase right, pledge, security interest, right of first refusal, or other similar rights of third parties or restriction of any kind with respect to any asset.

"<u>Enforceability Exceptions</u>" has the meaning set forth in Section 3.01(a).

"<u>Engine</u>" means each of the engines identified in Schedule 1.01(a).

"<u>Environmental Laws</u>" means all Applicable Laws, and any Governmental Order or binding agreement with any Governmental Authority: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, human health or safety, or the environment (including ambient or indoor air, soil, surface water or groundwater,

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or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal or remediation of any Hazardous Substances. The term "<u>Environmental Law</u>" includes the following (including their implementing regulations and any state analogs): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq. ("<u>CERCLA</u>"); the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act of 1910, as amended, 7 U.S.C. §§ 136 et seq.; the Oil Pollution Act of 1990, as amended, 33 U.S.C. §§ 2701 et seq.; and the Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. §§ 651 et seq pertaining to the regulation and protection of the environment, health, safety of persons, management or use of natural resources, protection or use of surface water and groundwater, conservation, wildlife, waste management, Hazardous Substances or pollution (including regulating of releases and disposal to air, land, water and groundwater), including any federal, state or local transfer of ownership notification or approval statutes.

"<u>ERISA Affiliate</u>" means each entity, trade or business that is, or was at the relevant time, a member of a group described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes or included the Company, or that is, or was at the relevant time, a member of the same "controlled group" as the Company pursuant to Section 4001(a)(14) of ERISA.

"<u>Estimated Adjustment Amounts</u>" has the meaning set forth in Section 2.03(a).

"<u>Estimated Closing Payment</u>" has the meaning set forth in Section 2.03(a).

"<u>Estimated Closing Statement</u>" has the meaning set forth in Section 2.03(a).

"<u>Excluded Assets</u>" has the meaning set forth in Section 5.03.

"<u>FAA</u>" has the meaning set forth in Section 3.03.

"<u>FCC</u>" has the meaning set forth in Section 3.03.

"<u>Final Closing Payment</u>" has the meaning set forth in Section 2.03(c)(iii) or Section 2.03(c)(iv), as applicable.

"<u>Financial Statements</u>" has the meaning set forth in Section 3.06.

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"<u>Fundamental Representations</u>" means the representations and warranties set forth in Sections 3.01, 3.02(i), 3.05, 3.11, 3.24, 3.25, 4.01, 4.03 and 4.04.

"<u>Governmental Authority</u>" means any: (a) U.S. federal or state government; or (b) U.S. federal or state governmental authority (including any governmental agency, branch, board, commission, department, instrumentality, office or other entity, and any court or other tribunal), including ICE, the FAA, DOT, DOD, FCC and DHS (including the TSA).

"<u>Governmental Order</u>" means any decision, order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority.

"<u>Guaranteed Obligations</u>" has the meaning set forth in Section 9.19(a).

"<u>Guarantor</u>" has the meaning set forth in the preamble.

"<u>Hazardous Substances</u>" means: (a) "Hazardous Substances," "hazardous wastes," "hazardous substances," "industrial wastes," or "toxic pollutants," as such terms are defined under any Environmental Laws or are regulated, pursuant to Environmental Laws; (b) any petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead-containing materials, polychlorinated biphenyls, and per- and poly-fluoroalkyl substances (PFAS) and other emerging contaminants; and (c) any other substance with respect to which any Environmental Law or Governmental Authority requires environmental investigation, regulation, monitoring or remediation.

"<u>Income Tax</u>" means any federal, state, local or non-U.S. income tax measured by or imposed on net income.

"<u>Income Tax Return</u>" means any Tax Return of the Company reflecting Income Taxes.

"<u>Indebtedness</u>" means, with respect to any Person and as of any date of determination, all Liabilities of such Person: (i) for borrowed money; (ii) for the deferred purchase price of property or services (including any earn-out, purchase price adjustment or similar obligation); (iii) evidenced by notes, bonds, debentures or other similar instruments, other than any such instrument owned or held by such Person; (iv) under factoring or similar facilities; (v) under financial derivative agreements or hedging or "swap" arrangements, whether of interest or currency exchange rates, or otherwise, including caps and collars; (vi) under conditional sale or other title retention agreements (even if the rights and remedies of the seller or lender under such agreements in the event of default are limited to repossession or sale of the property acquired by such Person thereunder); (vii) for the payment of money as a lessee under leases that have been or should be, in accordance with GAAP, recorded as finance leases or capital leases for financial reporting purposes; (viii) that are secured by an Encumbrance upon property owned by such Person; (ix) under any off-balance sheet financing arrangements; (x) that are unfunded or underfunded and are owed or may become due pursuant to any pension, retirement or nonqualified deferred compensation plan or arrangement other than any obligation to contribute to a 401-K plan for such Person's employees, any unpaid severance obligations with respect to any current or former director, officer, employee, independent contractor who is terminated prior

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to the Closing; (xi) the items set forth in Schedule 1.01(b)(i), and (xii) all Liabilities of the type described in (i) to (xi) above that are owed by any other third party and that are guaranteed by such Person or in effect guaranteed by such Person through an agreement, contingent or otherwise, to purchase, repurchase or pay any or all of such amounts, or in respect of which such Person has otherwise assured a creditor against loss. Indebtedness shall include all principal, accrued and unpaid interest, breakage costs, prepayment and redemption premiums and penalties, unpaid fees, and other monetary obligations relating to the items described above and, except to the extent expressly provided above, shall exclude Taxes. Notwithstanding anything to the contrary in this Agreement, the following shall not be Indebtedness: (a) any accounts payable arising in the ordinary course of business; (b) obligations and liabilities incurred in connection with the construction of the Company's hangar in [\*\*\*] and (c) any items set forth in Schedule 1.01(b)(ii).

"<u>Indemnified Party</u>" means collectively, Buyer Indemnified Parties and Seller Indemnified Parties.

"<u>Indemnified Person</u>" means any Person entitled to indemnification under this Agreement.

"<u>Indemnified Taxes</u>" means, except to the extent any of the following Taxes were taken into account as a reduction of the Final Closing Payment, (a) all Taxes imposed upon the Company with respect to any Pre-Closing Tax Period; (b) all Taxes of any member of an affiliated, consolidated, combined, or unitary group of which the Company is or was a member on or prior to the Closing Date, including pursuant to Treasury Regulations Section 1.1502-6 or any analogous or similar Applicable Law; and (c) all Taxes of any Person imposed on the Company as a transferee or successor, by contract (other than commercial agreements, such as credit agreements and leases, the principal purpose of which is not Taxes) or pursuant to any law, which Taxes relate to an event, transaction, or agreement occurring or entered into before the Closing.

"<u>Indemnifying Person</u>" means any Person required to indemnify another Person under this Agreement.

"<u>Indemnity Basket</u>" means [\*\*\*].

"<u>Indemnity Cap</u>" means [\*\*\*].

"<u>Injunction</u>" means any and all writs, rulings, awards, injunctions (whether temporary, preliminary or permanent), judgments, decrees or orders (whether executive, judicial or otherwise) adopted, enacted, implemented, promulgated, issued or entered by or under the authority of any Governmental Authority.

"<u>Insurance Policies</u>" has the meaning set forth in Section 3.21.

"<u>Intellectual Property</u>" means any and all rights in, arising out of, or associated with any of the following in any jurisdiction throughout the world: (a) issued patents and patent

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applications (whether provisional or non-provisional), including divisionals, continuations, continuations-in-part, substitutions, reissues, reexaminations, extensions, or restorations of any of the foregoing, and other Governmental Authority-issued indicia of invention ownership (including certificates of invention, petty patents, and patent utility models) ("<u>Patents</u>"); (b) trademarks, service marks, brands, certification marks, logos, trade dress, trade names, and other similar indicia of source or origin, together with the goodwill connected with the use of and symbolized by, and all registrations, applications for registration, and renewals of, any of the foregoing ("<u>Trademarks</u>"); (c) copyrights and works of authorship, whether or not copyrightable, and all registrations, applications for registration, and renewals of any of the foregoing ("<u>Copyrights</u>"); (d) internet domain names and social media account or user names (including "handles"), whether or not Trademarks, all associated web addresses, URLs, websites and web pages, social media sites and pages, and all content and data thereon or relating thereto, whether or not Copyrights; (e) industrial designs, and all Patents, registrations, applications for registration, and renewals thereof; (f) trade secrets, know-how, inventions (whether or not patentable), discoveries, improvements, technology, business and technical information, databases, data compilations and collections, tools, methods, processes, techniques, and other confidential and proprietary information and all rights therein ("<u>Trade Secrets</u>"); (g) computer programs, operating systems, applications, firmware and other code, including all source code, object code, application programming interfaces, data files, databases, protocols, specifications, and other documentation thereof ("<u>Software</u>"); (h) rights of publicity; and (i) all other intellectual or industrial property and proprietary rights.

"<u>Intellectual Property Registrations</u>" has the meaning set forth in Section 3.22(a).

"<u>Interim Balance Sheet</u>" has the meaning set forth in Section 3.06(a).

"<u>Interim Balance Sheet Date</u>" has the meaning set forth in Section 3.06(a).

"<u>Interim Financial Statements</u>" has the meaning set forth in Section 3.06(a).

"<u>IRS</u>" means the Internal Revenue Service.

"<u>Leased Real Property</u>" has the meaning set forth in Section 3.16.

"<u>Leases</u>" has the meaning set forth in Section 3.16.

"<u>Liability</u>" or "<u>Liabilities</u>" means any and all debts, deficiency, Tax, penalty, fine, expense, commitment, liabilities and/or obligations of any type, nature or description (whether known or unknown, asserted or unasserted, secured or unsecured, absolute or contingent, accrued or unaccrued, liquidated or unliquidated and whether due or to become due, or vested or unvested) and including all reasonable costs and expenses relating thereto.

"<u>Loss(es)</u>" means, collectively, any and all out-of-pocket losses, damages, assessments, judgments, Taxes, Liabilities, costs, or expenses, including reasonable attorneys' fees and disbursements; provided, however, that "<u>Losses</u>" shall not include incidental, consequential, special, indirect or punitive damages, including loss of future revenue or income, loss of business

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reputation or opportunity except to the extent actually awarded to a Governmental Authority or other third party nor shall include loss due to intentional fraud.

"<u>Material Adverse Effect</u>" means, since the Interim Balance Sheet Date, [\*\*\*].

"<u>Material Contracts</u>" has the meaning set forth in Section 3.20(a).

"<u>Membership Interests</u>" has the meaning set forth in the Recitals.

"<u>Multiemployer Plan</u>" means each Benefit Plan that is a "multiemployer plan" as defined in Section 3(37) or 4001(a)(3) of ERISA or Section 414(f) of the Code.

"<u>Negative Adjustment Amount</u>" has the meaning set forth in Section 2.03(d)(ii).

"<u>Objection Notice</u>" has the meaning set forth in Section 7.05(a).

"<u>Ordinary Course of Business</u>" means an action taken by a Person if such action is consistent in all material respects with the past practices of such Person and is taken in the ordinary course of the normal day-to-day operations of such Person and, with respect to the Company, in the [\*\*\*] period prior to the effective date of this Agreement.

"<u>Outside Closing Date</u>" means the date that is five Business Days after the later of (a) receipt of all governmental and regulatory approvals required under this Agreement and (b) satisfaction or written waiver of all conditions to Closing (other than those to be satisfied at Closing), but in no event later than [\*\*\*].

"<u>Parts</u>" means all appliances, avionics, components, parts, instruments, appurtenances, accessories, furnishings, seats, galleys, galley equipment, serving equipment, lavatories, cargo handling equipment, safety equipment and other equipment of whatever nature (other than complete Engines or engines) incorporated or installed or positioned in or on or attached to any Airframe or any Engine.

"<u>Patents</u>" has the meaning set forth in the definition of "Intellectual Property".

"<u>Pay-Off Letters</u>" has the meaning set forth in Section 2.03(b)(ii).

"<u>Payroll Tax Executive Order</u>" means the Presidential Memorandum on Deferring Payroll Tax Obligations in Light of the Ongoing COVID-19 Disaster, as issued on August 8, 2020 and including any administrative or other guidance published with respect thereto by any Governmental Authority (including IRS Notice 2020-65).

"<u>Permits</u>" has the meaning set forth in Section 3.12(a).

"<u>Permitted Encumbrances</u>" means Encumbrances for Taxes not yet due and payable or that are being contested in good faith, or mechanics', carriers', workers' and other statutory Encumbrances arising or incurred in the Ordinary Course of Business, in each case that individually or in the aggregate with other such title defect, does not materially impair (i) the

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value of the property subject to such Encumbrances or other such title defect or (ii) the use of such property in the conduct of the Business.

"<u>Person</u>" means any individual, corporation (including any nonprofit corporation), general, limited or limited liability partnership, limited liability company, joint venture, estate, trust, association, organization, or other entity or Governmental Authority.

"<u>Personal Information</u>" means any information that identifies or, alone or in combination with any other information, could reasonably be used to identify, locate, or contact a natural Person, including name, street address, telephone number, email address, identification number issued by a Governmental Authority, credit card number, bank information, customer or account number, online identifier, device identifier, IP address, browsing history, search history, or other website, application, or online activity or usage data, location data, biometric data, medical or health information, or any other information that is considered "personally identifiable information," "personal information," or "personal data" under, or is otherwise regulated by, Applicable Law (including Privacy Laws).

"<u>Positive Adjustment Amount</u>" has the meaning set forth in Section 2.03(d)(i).

"<u>Post-Closing Representation</u>" has the meaning set forth in Section 9.12(a).

"<u>Post-Closing Tax Period</u>" has the meaning set forth in Section 6.04(g).

"<u>Pre-Closing Period</u>" has the meaning set forth in Section 5.01.

"<u>Pre-Closing Straddle Period</u>" means the portion of any Straddle Period ending on (and including) the Closing Date.

"<u>Pre-Closing Tax Period</u>" means any taxable period (or portion thereof) ending on or before the Closing Date.

"<u>Privacy Laws</u>" means all Applicable Laws, Governmental Orders, and guidance issued by any Governmental Authority concerning the privacy, security, or Processing of Personal Information (including laws of jurisdictions where Personal Information was collected), including, as applicable, data breach notification laws, consumer protection laws, laws concerning requirements for website and mobile application privacy policies and practices, Social Security number protection laws, data security laws, and laws concerning email, text message, or telephone communications. Without limiting the foregoing, Privacy Laws include: the Federal Trade Commission Act, the Telephone Consumer Protection Act, the Telemarketing and Consumer Fraud and Abuse Prevention Act, the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, the Children's Online Privacy Protection Act, the California Consumer Privacy Act of 2018, the Computer Fraud and Abuse Act, the Electronic Communications Privacy Act, the Fair Credit Reporting Act, the Fair and Accurate Credit Transaction Act, the Health Insurance Portability and Accountability Act of 1996, as amended and supplemented by the Health Information Technology for Economic and Clinical Health Act of the American Recovery and Reinvestment Act of 2009, the Gramm-Leach-Bliley Act, the

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Family Educational Rights and Privacy Act, the General Data Protection Regulation (Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016), and all other similar international, federal, state, and local laws.

"<u>Processing</u>" means any operation performed on Personal Information or other confidential business information, including the collection, creation, receipt, access, use, handling, compilation, analysis, monitoring, maintenance, retention, storage, transmission, transfer, protection, disclosure, distribution, destruction, or disposal of Personal Information. The terms "<u>Process</u>" and "<u>Processed</u>" shall have correlative meanings.

"<u>Proposed Closing Payment</u>" has the meaning set forth in Section 2.03(c)(i).

"<u>Purchase Price Allocation Schedule</u>" has the meaning set forth in Section 6.04(j).

"<u>Real Property</u>" has the meaning set forth in Section 3.16.

"<u>Related Agreements</u>" means any ancillary agreements, instruments and certificates contemplated hereunder to be delivered by any party hereto at or prior to the Closing as set forth under Section 5.05, including (a) the Asset Purchase Agreement to be executed between the Guarantor and the Buyer for the purchase of thirteen aircraft (the "<u>CSI Asset Purchase Agreement</u>"), and (b) the Asset Purchase Agreement to be executed between the Guarantor and Associated Energy Group LLC for the purchase of twelve aircraft (the "<u>AEG Asset Purchase Agreement</u>" and, together with the CSI Asset Purchase Agreement, the "<u>Asset Purchase Agreements</u>").

"<u>Related Person</u>" or "<u>Related Persons</u>" means, with respect to (a) a natural Person, each family member; and any Affiliate of a family member, or (b) any other Person, any Affiliate of such Person, and each Person that serves as a director, governor, officer, manager, general partner, executor or trustee of such Person (or in a similar capacity).

"<u>Release</u>" means any actual or threatened release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including ambient or indoor air, surface water, groundwater, land surface or subsurface strata or within any building, structure, facility or fixture).

"<u>Representative</u>" means, with respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants and other agents of such Person.

"<u>Resolution Period</u>" has the meaning set forth in Section 2.03(c)(iii).

"<u>Review Period</u>" has the meaning set forth in Section 2.03(c)(ii).

"<u>Rotables</u>" means the rotable Parts used for the Aircraft that are not expendable aircraft components and Parts.

"<u>Seller</u>" has the meaning set forth in the preamble.

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"<u>Seller Counsel</u>" has the meaning set forth in Section 9.12(a).

"<u>Seller Counsel Work Product</u>" has the meaning set forth in Section 9.12 (c).

"<u>Seller Disclosure Schedule</u>" has the meaning set forth in Article III.

"<u>Seller's Knowledge</u>" means the actual knowledge of [\*\*\*] after reasonable due inquiry as to the representations so qualified by this definition.

"<u>Seller Indemnified Parties</u>" has the meaning set forth in Section 7.03.

"<u>Seller Prepared Tax Return</u>" has the meaning set forth in Section 6.04.

"<u>Seller Releasing Parties</u>" has the meaning set forth in Section 6.06.

"<u>Software</u>" has the meaning set forth in the definition of "Intellectual Property".

"<u>Special Indemnity Matters</u>" means, collectively: [\*\*\*].

"<u>Statement of Objections</u>" has the meaning set forth in Section 2.03(c)(iii).

"<u>Straddle Period</u>" means any taxable period beginning on or before and ending after the Closing Date.

"<u>Subsidiary</u>" means, with respect to any Person, any corporation, limited liability company, partnership, association, or other business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or a combination thereof or (b) if a limited liability company, partnership, association, or other business entity (other than a corporation), a majority of the partnership or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more Subsidiaries of such Person or a combination thereof and for this purpose, such Person owns a majority ownership interest in such a business entity (other than a corporation) if such Person shall be allocated a majority of such business entity's gains or losses or shall be or control any managing director or general partner of such business entity (other than a corporation). The term "Subsidiary" shall include all Subsidiaries of such Subsidiary.

"<u>Tax</u>" means: (a) all U.S. federal, state or local and all non-U.S. taxes, duties, imposts or other governmental fee, levy, charge or assessment, including income, capital gains, gross receipts, windfall profits, profits, value added, excise, severance, property stamp, production, sales, use, duty, license, excise, alternative minimum, add-on minimum, passenger facility charge, arrival/departure tax, agricultural fee, fuel, liquor, franchise, employment, unemployment, disability, social security (or similar), premium, transfer, registration, natural resources, environmental, ad valorem, capital stock, payroll, estimated, severance, occupation, withholding or similar taxes, in each case, however denominated, whether disputed or not,

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together with any interest, additions or penalties with respect thereto; (b) any liability for or with respect to amounts described in clause (a) whether as a result of joint, several, successor or transferee liability, of being a member of an affiliated group for any period or through operation of law; and (c) any liability for or with respect to amounts described in clauses (a) or (b) as a result of any Tax allocation, Tax sharing, Tax separation, Tax indemnity or other similar agreement regarding Taxes (other than commercial agreements, such as credit agreements and leases, the principal purpose of which is not Taxes).

"<u>Tax Proceeding</u>" has the meaning set forth in Section 6.04(f).

"<u>Tax Returns</u>" means any return, declaration of estimated Taxes, claim for refund, report, information return or other document (including schedules or any related or supporting information) relating to Taxes and filed or required to be filed with a Governmental Authority.

"<u>Tax Sharing Agreement</u>" has the meaning set forth in Section 6.04(d).

"<u>Taxing Authority</u>" means any Governmental Authority exercising its taxing authority.

"<u>Third-Party Claim</u>" has the meaning set forth in Section 7.06(a).

"<u>Third-Party Claim Notice</u>" has the meaning set forth in Section 7.06(a).

"<u>Trade Secrets</u>" has the meaning set forth in the definition of "Intellectual Property".

"<u>Trademarks</u>" has the meaning set forth in the definition of "Intellectual Property".

"<u>Transaction Expenses</u>" means, collectively: (a) any and all fees, costs and expenses (including legal, accounting, consultant's, broker's, investment bankers' and finder's fees and expenses) incurred by the Seller or the Company in connection with the sale or other disposition of the business of Company, including the transactions contemplated hereby, to the extent such amounts are unpaid as of immediately prior to the Closing; (b) any and all change in control payments, retention bonuses, transaction bonuses, severance or other similar payments that become payable by the Company by reason of the execution of this Agreement or the consummation of the transactions contemplated hereby (whether alone, or in connection with another "double trigger" event); (c) the employer's share of withholding, payroll, employment or similar taxes resulting from any payments made in respect of any employee whose employment is terminated in connection with the transactions contemplated hereby (resulting from any payments described in clause (b) above) or from the cancellation, exchange or exercise of any options issued by the Company; (d) any out of pocket fees and expenses agreed to by the Seller or the Company prior to the Closing in connection with obtaining waivers, consents or approvals of any Persons on behalf of the Company in connection with the transactions contemplated hereby, that remain unpaid as of the Closing. For the avoidance of doubt, Transaction Expenses shall not include any of the aforementioned expenses and other costs of Buyer or as result of the Company incurring additional costs and expenses after the Closing.

"<u>Transaction Expense Invoices</u>" has the meaning set forth in Section 2.03(b)(iii).

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"<u>Transaction Tax Deductions</u>" means any and all Tax deductions related to (a) any bonuses paid or accrued on or prior to the Closing Date in connection with the transactions contemplated hereby, (b) expenses with respect to Indebtedness being paid in connection with or at Closing, (c) all transaction expenses and payments that are deductible for Tax purposes, including fees and expenses of legal counsel, accountants, and investment bankers of the Seller or the Company paid or accrued on or prior to the Closing Date in connection with the transactions contemplated hereby, and (d) any other amounts paid out of, withheld from, or which otherwise reduced the amount of or were reductions for determining the purchase price. In connection with the foregoing, the parties agree to apply the 70% safe-harbor election set forth in Internal Revenue Service Revenue Procedure 2011-29 to determine the amount of deductions attributable to the payment of any success based fees within the scope of such Revenue Procedure.

"<u>Transfer Taxes</u>" has the meaning set forth in Section 6.04(c).

"<u>TSA</u>" has the meaning set forth in Section 3.03.

"<u>Undisputed Amount</u>" has the meaning set forth in Section 2.03(c)(iv).

"<u>Unions</u>" has the meaning set forth in Section 3.19(e).

"<u>Unregistered Trademarks</u>" has the meaning set forth in Section 3.22(b).

"<u>WARN Act</u>" has the meaning set forth in Section 3.19(f).

"<u>Year-End Financial Statements</u>" has the meaning set forth in Section 3.06(a).

**ARTICLE II<br>BASIC TRANSACTION**

**Section 2.01&nbsp;&nbsp;&nbsp;&nbsp;Purchase And Sale.** Subject to the terms and conditions set forth herein, at the Closing, the Seller shall sell to the Buyer, and the Buyer shall purchase from the Seller, all of the Seller's right, title, and interest in and to the Membership Interests, free and clear of any Encumbrances.

**Section 2.02&nbsp;&nbsp;&nbsp;&nbsp;Closing Payment**. The aggregate purchase price for the Membership Interests shall be an amount equal to: (a) [\*\*\*], <u>minus</u> (b) the sum of (i) [\*\*\*] and (ii) [\*\*\*] (the amount set forth in clause (a), minus the amount set forth in clause (b), the "<u>Closing Payment</u>"). The Closing Payment shall be estimated, reconciled and paid as provided in <u>Section 2.03</u>. Seller shall not be liable for any of the matters set forth in Schedule 1.01(b)(ii) nor shall such matters cause any reduction to the purchase price payable under this Agreement. The Buyer and the Company agree to assume and retain such Liabilities after the Closing and shall not bring any claim of payment against the Seller with respect to such matters.

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**Section 2.03&nbsp;&nbsp;&nbsp;&nbsp;Closing Payment Estimate, Reconciliation And Payment**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Closing Payment Estimate. At least [\*\*\*] prior to the Closing Date, the Seller shall deliver to the Buyer a statement (the "<u>Estimated Closing Statement</u>") setting forth: (i) a good faith estimate of [\*\*\*] (collectively, the "<u>Estimated Adjustment Amounts</u>"); and (ii) the resulting calculation of the Closing Payment using the Estimated Adjustment Amounts (such calculation, the "<u>Estimated Closing Payment</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Payment of Estimated Closing Payment. At the Closing, the Buyer shall pay, or cause to be paid:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;to the Seller, an amount equal to the Estimated Closing Payment by wire transfer of immediately available funds to such account as the Seller shall direct in writing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;to the holders thereof, the payoff amount of all Closing Indebtedness (as estimated pursuant to <u>Section 2.03(a)</u>) pursuant to pay-off letters in form and substance reasonably acceptable to the Buyer (the "<u>Pay-Off Letters</u>"); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;to the Persons entitled thereto, the amount of all unpaid Transaction Expenses (as estimated pursuant to <u>Section 2.03(a)</u>) pursuant to final invoices in form and substance reasonably acceptable to the Buyer (the "<u>Transaction Expense Invoices</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Closing Payment Reconciliation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Within [\*\*\*] after the Closing Date, the Buyer shall prepare and deliver to the Seller a statement (the "<u>Closing Statement</u>") setting forth: (A) its calculation of Closing Indebtedness, Transaction Expenses (the "<u>Closing Adjustment Amounts</u>"); and (B) its calculation of the Closing Payment using the Closing Adjustment Amounts (such calculation, the "<u>Proposed Closing Payment</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;The Seller shall have [\*\*\*] (the "<u>Review Period</u>") to review the Closing Statement. During the Review Period, the Seller and its accountants shall have reasonable access to: (A) the books and records of the Company; (B) the personnel of, and work papers prepared by, the Buyer and/or the Buyer's accountants to the extent that they assisted in the preparation of, or relate to, to the Closing Statement; and (C) such historical financial information (to the extent in the Buyer's or the Company's possession) relating to the Closing Statement, in each case as the Seller may reasonably request for the purposes of reviewing the Closing Statement and preparing a Statement of Objections (if any); provided, that such access shall be in a manner that does not unreasonably interfere with the normal business operations of the Buyer or the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;On or prior to the last day of the Review Period, the Seller may object to the Closing Statement by delivering to the Buyer a written statement setting forth the Seller's objections in reasonable detail, indicating each disputed item or amount

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and the basis for the Seller's disagreement therewith (the "<u>Statement of Objections</u>"). If the Seller delivers the Statement of Objections, the Buyer and the Seller shall negotiate in good faith to resolve such objections within [\*\*\*] after the delivery of the Statement of Objections (the "<u>Resolution Period</u>"), and if all such objections are so resolved within the Resolution Period: (x) the Closing Statement and the Closing Adjustment Amounts reflected in the Closing Statement, in each case with such changes as have been agreed in writing by the Buyer and the Seller, shall be final and binding; and (y) the Closing Payment, calculated using such agreed-upon Closing Adjustment Amounts under clause (x) above shall be deemed to be the "<u>Final Closing Payment</u>" under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;If the Seller and the Buyer fail to reach an agreement with respect to all of the matters set forth in the Statement of Objections before expiration of the Resolution Period, then any amounts remaining in dispute (the "<u>Disputed Amounts</u>" and any amounts not so disputed or agreed to by the parties in writing during the Resolution Period, the "<u>Undisputed Amounts</u>") shall be submitted for resolution to a mutually agreed independent accounting firm of national recognition (the "<u>Independent Accountants</u>") who, acting as experts and not arbitrators, shall: (A) resolve the Disputed Amounts; and (B) make such adjustments to the Closing Statement, the Closing Adjustment Amounts and the Proposed Closing Payment, as are necessary to reflect all Undisputed Amounts and its resolution of the Disputed Amounts. The parties hereto agree that all adjustments shall be made without regard to materiality. The Independent Accountants shall only decide the specific items under dispute by the parties, and their decision for each Disputed Amount must be within the range of values assigned to each such item in the Closing Statement and the Statement of Objections, respectively. The fees and expenses of the Independent Accountant shall be paid by the Seller, on the one hand, and by the Buyer (or the Company), on the other hand, [\*\*\*]. The Independent Accountants shall make a determination as soon as practicable within [\*\*\*] (or such other time as the parties hereto shall agree in writing) after their engagement. The Independent Accountants' resolution of the Disputed Amounts shall be conclusive and binding upon the parties, absent manifest error or fraud. If the parties are unable to resolve all Disputed Amounts under Section 2.03(c)(iii) above and such Disputed Amounts are resolved by the Independent Accountants under this Section 2.03(c)(iv), the Proposed Closing Payment, as adjusted to include such resolution by the Independent Accountants of the Disputed Amounts and incorporation of all Undisputed Amounts, shall be the "<u>Final Closing Payment</u>" under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;Payment of Closing Payment Adjustment. Within [\*\*\*] after the determination of the Final Closing Payment under this Section 2.03 (by agreement of the parties or determination of the Independent Accountants, as appropriate):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;if the Final Closing Payment is greater than the Estimated Closing Payment (the amount by which it is greater, the "<u>Positive Adjustment Amount</u>"), then the Buyer shall pay, or cause to be paid, the Positive Adjustment Amount to the Seller by wire transfer of immediately available funds to such account as it shall direct in writing; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;if the Estimated Closing Payment is greater than the Final Closing Payment (the amount by which it is greater, the "<u>Negative Adjustment Amount</u>"), then the Seller shall pay the Negative Adjustment Amount to the Buyer by wire transfer of immediately available funds to such account as it shall direct in writing.

**Section 2.04&nbsp;&nbsp;&nbsp;&nbsp;Withholding**. Notwithstanding any other provision of this Agreement, the Buyer shall be entitled to deduct and withhold from any amounts payable or deliverable under this Agreement such amounts as are required to be withheld pursuant to any Applicable Law. Any amount so deducted or withheld and paid over to the appropriate Governmental Authority on behalf of the Person in respect of which such deduction or withholding is made shall be treated for all purposes under this Agreement as having been paid to such Person. The Buyer shall provide the Seller with at least [\*\*\*] notice before withholding any amounts payable or deliverable under this Agreement, and shall provide the Seller the reasonable opportunity to establish any available exemption therefrom.

**ARTICLE III<br>REPRESENTATIONS AND WARRANTIES OF THE SELLER**

The Seller represents and warrants to the Buyer that the statements contained in this <u>Article III</u> are true and correct as of the date hereof and as of the Closing Date, except as otherwise set forth herein or in written disclosure schedules (the "<u>Seller Disclosure Schedules</u>") delivered to Buyer pursuant to this <u>Article III</u>. The Seller Disclosure Schedules are numbered to correspond to the various sections of this <u>Article III</u> setting forth certain exceptions to the representations and warranties contained in such corresponding section of this <u>Article III</u> and certain other information required by such section.

**Section 3.01&nbsp;&nbsp;&nbsp;&nbsp;Organization And Authority Of The Seller And The Company; Enforceability**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Seller has full corporate power and authority to enter into this Agreement, the Related Agreements to which it is a party, and the other documents to be delivered hereunder and thereunder, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery, and performance by the Seller of this Agreement, the Related Agreements to which it is a party, and the other documents to be delivered hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of the Seller. This Agreement, the Related Agreements to which it is a party, and the other documents to be delivered hereunder and thereunder have been duly executed and delivered by the Seller, and (assuming due authorization, execution, and delivery by the Buyer) this Agreement, the Related Agreements to which it is a party, and the other documents to be delivered hereunder and thereunder constitute legal, valid, and binding obligations of the Seller, enforceable against the Seller in accordance with their respective terms, except as may be limited by any bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other similar laws affecting the

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enforcement of creditors' rights generally or by general principles of equity (the "<u>Enforceability Exceptions</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Company is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has full limited liability company power and authority to own, lease and use its properties and to carry on the Business as presently conducted. <u>Section 3.01(b) of the Seller Disclosure Schedules</u> lists each state or other jurisdiction in which the Company is qualified to conduct business as a foreign limited liability company. The Company is duly qualified or licensed to do business and in good standing as a foreign company in each of the jurisdictions in which the nature of the Business or the character of the properties and assets which it owns or leases makes such qualification or licensing required, except where the failure to be so qualified would not be material to the Company.

**Section 3.02&nbsp;&nbsp;&nbsp;&nbsp;No Conflicts; Consents.** The Seller's: (a) execution, delivery and performance of this Agreement and the Related Agreements to which the Seller is a party; (b) consummation of the transactions contemplated hereby and thereby; and (c) compliance with or fulfillment of the terms and provisions hereof and thereof, or of any other agreement or instrument contemplated hereby or thereby, do not (i) conflict with or result in a breach of (A) any of the provisions of the Seller's or the Company's Charter Documents, or (B) any resolution adopted by the board of directors or shareholders (or their equivalent) of the Seller or the Company; (ii) contravene, conflict with, or result in a violation of, or give any Governmental Authority the right to revoke, withdraw, suspend, cancel, terminate or modify any Permit that is held by the Company or that otherwise relates to its business; (iii) except as set forth in <u>Section 3.02 of the Seller Disclosure Schedules</u>, result in a breach of, constitute a default under or give rise to a right of termination or acceleration under any Contract, license, franchise or any other agreement or instrument to which the Seller or the Company is a party or by which any of their properties may be affected or bound; (iv) result in the imposition or creation of any Encumbrance upon or with respect to any of the assets owned or used by the Company or any of the Aircraft, Engine and Rotables; (v) except as set forth in <u>Section 3.02 of the Seller Disclosure Schedules</u>, require the Company to obtain the approval, consent or authorization of, or to make any declaration, filing or registration with, any Governmental Authority or other Person; or (ix\\vi) result in any equity holder of the Seller or the Company having the right to exercise dissenters' or appraisal rights.

**Section 3.03&nbsp;&nbsp;&nbsp;&nbsp;Regulatory Obligations.** Except for those consents, registrations, notices, waivers, exemptions, approvals, confirmations, clearances, permits, certificates, orders, and authorizations set forth on <u>Section 3.03 of the Seller Disclosure Schedules</u> that are required to be obtained from, or delivered to, as applicable, the United States Federal Aviation Administration ("<u>FAA</u>"), United States Department of Transportation ("<u>DOT</u>"), Transportation Security Administration ("<u>TSA</u>"), United States Department of Defense ("<u>DOD</u>"), and Federal Communications Commission ("<u>FCC</u>"), which the parties intend to obtain before the Closing pursuant to this Agreement, no other consent, registration, notice, waiver, exemption, approval, confirmation, clearance, permit, certificate, order, or authorization is required to be obtained by the Seller or the Company from any Governmental Authority in connection with the execution,

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delivery, and performance by the Seller or the Company of this Agreement or the Related Agreements or the consummation of the transactions contemplated hereby and thereby.

**Section 3.04&nbsp;&nbsp;&nbsp;&nbsp;Legal Proceedings.** Except as set forth on <u>Section 3.04 of the Seller Disclosure Schedules</u>, there is no Action of any nature pending or threatened in writing, or to the Seller's Knowledge, threatened orally: (a) against, by, or involving the Seller or the Company or any of the Company's officers or directors (in their capacity as such) or any of the Company's owned or leased assets that would be material; (b) relating to or affecting the Membership Interests; or (c) that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement or the Related Agreements. To Seller's Knowledge, no event has occurred or circumstance exists that would reasonably be expected to give rise to or serve as the basis for the commencement of any Action that would, individually or in the aggregate, have a Material Adverse Effect. Since the past five (5) years, neither the Seller nor the Company are, or have been, subject to or bound by any Governmental Order that remains pending.

**Section 3.05&nbsp;&nbsp;&nbsp;&nbsp;Capitalization; Ownership Of Membership Interests**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Seller is the sole legal, beneficial, record, and equitable owner of the Membership Interests, free and clear of all Encumbrances (other than restrictions on transfer arising under the Securities Act and state securities laws). The Membership Interests constitute 100% of the total issued and outstanding equity interests in the Company and other than the Membership Interests there are no other issued and outstanding equity interests in the Company. Upon consummation of the transactions contemplated hereby, the Buyer will own the Membership Interests free and clear of any and all Encumbrances (other than restrictions on transfer arising under the Securities Act and state securities laws or any Encumbrances created at Closing as a result of on the part of the Buyer), and the Company will not have issued or outstanding any securities convertible into or exchangeable for any equity interests of the Company nor will it have any issued or outstanding rights, options, agreements or arrangements to subscribe for or to purchase their equity interests or any securities convertible into or exchangeable for its equity interests.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Membership Interests were issued in compliance with Applicable Laws. The Membership Interests were not issued in violation of the Charter Documents of the Company or any other agreement, arrangement, or commitment to which the Seller or the Company is a party (including its bylaws) and are not subject to or in violation of any preemptive or similar rights of any person or entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Seller has provided to the Buyer true, complete and correct copies of the Charter Documents of the Seller and the Company, and such Charter Documents are in full force and effect. Other than the Charter Documents of the Company, there are no voting trusts, proxies, or other agreements or understandings in effect with respect to the voting or transfer of any of the Membership Interests. There are no outstanding or authorized options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to the Membership Interests or other equity interests in the Company or obligating the Seller or the Company to issue or sell any Membership Interests, or any other equity interest in the Company. There are no outstanding or authorized equity appreciation, profit participation,

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phantom equity or similar equity-based rights with respect to the Company. Other than as disclosed in the Interim Balance Sheet or obligations arising under Related Agreements to which the Seller and the Company are parties, the Company is not indebted, nor does it owe any amounts, to the Seller.

**Section 3.06&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Attached to Section 3.06(a) of the Seller Disclosure Schedules are true, accurate and complete copies of: (i) the balance sheets of the Company as of December 31, 2023 (which are audited), and December 31, 2024 (which are unaudited) and the related statements of operations and income for the fiscal years then ended (the "<u>Year-End Financial Statements</u>"); and (ii) the unaudited balance sheet of the Company (the "<u>Interim Balance Sheet</u>") as of September 30, 2025 (the "<u>Interim Balance Sheet Date</u>") and the related statement of operations and income for the nine (9) months then ended (the "<u>Interim Financial Statements</u>") (the Year-End Financial Statements and the Interim Financial Statements, collectively, the "<u>Financial Statements</u>"). To Seller's Knowledge, the Financial Statements have been prepared in accordance with GAAP applied on a consistent basis throughout the period involved, subject, in the case of the Interim Financial Statements, to normal and recurring year-end adjustments (the effect of which will not be materially adverse) and the absence of notes (that, if presented, would not differ materially from those presented in the Year-End Financial Statements). The Financial Statements are based on the books and records of the Company and fairly present, in all material respects, the financial condition of the Company as of the respective dates they were prepared and the results of the operations of the Company for the periods indicated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Company has not entered into any securitization transactions, off-balance sheet arrangements, synthetic leases, sale/leaseback arrangements or arrangements providing for the factoring of receivables or entered into any transaction involving the use of special purposes entities for any of the foregoing.

**Section 3.07&nbsp;&nbsp;&nbsp;&nbsp;Books And Records**. The books of account, equity record books and other records of the Company are complete and correct, in all material respects, and have been maintained in accordance with sound business practices, including the maintenance of an adequate system of internal controls.

**Section 3.08&nbsp;&nbsp;&nbsp;&nbsp;Absence Of Changes**. Since the Interim Balance Sheet Date, there has been no event, occurrence or development that has had, or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, and, except as disclosed in <u>Section 3.08 of the Seller Disclosure Schedules</u>, the Company has operated its business solely in the Ordinary Course of Business and consistent with past practices. Without limiting the generality of the foregoing, since the Interim Balance Sheet Date, except as set forth on <u>Section 3.08 of the Seller Disclosure Schedules</u>, the Company has not:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;amended or restated any of its Charter Documents, (ii) split, combined or reclassified any of its capital stock or other securities, (iii) issued, sold or disposed of any of its

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capital stock or other securities, (iv) granted any options, warrants or other rights to purchase or obtain (including upon conversion, exchange or exercise) any of its capital stock or other equity securities, (v) declared or paid any dividends or distributions on or in respect of any of its capital stock or other securities, other than in respect of the Excluded Assets, or (vi) redeemed, purchased or acquired any of its capital stock or other equity securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;made any material change in (i) any method of accounting or accounting practice, except as required by GAAP or as disclosed in the notes to the Financial Statements, or (ii) its cash management practices or policies, or its practices and procedures with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts, accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue or acceptance of customer deposits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;(i) undertaken any promotional, sales, discount or other activity that has had or could reasonably be expected to have the effect of accelerating sales or collections of receivables prior to the Closing that would otherwise be expected to occur subsequent to the Closing, (ii) revalued any assets (including by way of writing off notes or other receivables), (iii) incurred, assumed or guaranteed any Indebtedness, (iv) made any capital investment in, or any loan to, any other Person, (v) made any material capital expenditures, (vi) imposed or suffered any Encumbrance upon any of its properties, capital stock or assets, tangible or intangible, or (vii) made any loan to (or forgiven any loan to), or entered into any other transaction with, any of its direct or indirect equity holders, directors, officers or employees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;except with respect to Excluded Assets, (i) transferred, assigned, sold or otherwise disposed of any of the assets shown or reflected in the Interim Balance Sheet (other than cash, cash equivalents or marketable securities) or cancelled or waived any debts or entitlements, (ii) transferred, assigned or granted any license or sublicense of any material rights under or with respect to any Intellectual Property, or (iii) suffered any material damage, destruction or loss (whether or not covered by insurance) to its property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;(i) entered into any Contract that would constitute a Material Contract, or (ii) accelerated, terminated, modified, amended, restated or cancelled any Material Contract;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;except as disclosed in <u>Section 3.08(f) of the Seller Disclosure Schedules</u>, (i) granted any bonuses, whether monetary or otherwise, or increased in any wages, salary, severance, pension or other compensation or benefits in respect of its employees, officers, directors, independent contractors or consultants in excess of [\*\*\*], other than as provided for in any written agreements or required by Applicable Law, (ii) changed the terms of employment for any employee or terminated any employees for which the aggregate costs and expenses relating thereto exceed [\*\*\*], (iii) taken any action to accelerate the vesting or payment of any compensation or benefit for any employee, officer, director, independent contractor or consultant, or (iv) adopted, modified or terminated any employment, severance, retention or other agreement with any current or former employee, officer, director, independent contractor or consultant, or any Benefit Plan;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;(i) entered into a new line of business or abandoned or discontinued any existing lines of business, (ii) adopted any plan of merger, consolidation, reorganization, liquidation or dissolution, or (iii) filed a petition in bankruptcy under any provisions of federal or state bankruptcy law or consented to the filing of any bankruptcy petition against it under any similar law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;purchased, leased or otherwise acquired the right to own, use or lease any property or assets for an amount in excess of [\*\*\*], individually (in the case of a lease, per annum) or [\*\*\*] in the aggregate (in the case of a lease, for the entire term of the lease, not including any option term), except for purchases of inventory or supplies in the Ordinary Course of Business, consistent with past practices, or (ii) acquired by merger or consolidation with, or by purchase of a substantial portion of the assets or stock of, or by any other manner, any business or any Person or any division thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;taken any action to make, change or rescind any material Tax election, amend any material Tax Return, or change any of the Company's methods of Tax accounting; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;entered into any Contract to do any of the foregoing, or any taken any action that would result in any of the foregoing.

**Section 3.09&nbsp;&nbsp;&nbsp;&nbsp;Liabilities And Indebtedness**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;All Indebtedness of the Company is listed on Section 3.09(a) of the Seller Disclosure Schedules. The Company is not committed or required to make any capital expenditures, nor have any capital expenditures been authorized by the Company that have not been made and fully paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Company has no Liabilities, except for: (i) Liabilities reflected or reserved against in the Interim Balance Sheet; (ii) non-material current liabilities incurred in the Ordinary Course of Business since the Interim Balance Sheet Date; or (iii) executory obligations of the Company arising in the Ordinary Course of Business under any Contract to which the Company is party.

**Section 3.10&nbsp;&nbsp;&nbsp;&nbsp;Aircraft And Rotables.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Company is not a party to any interchange or pooling agreements with respect to the Aircraft, Engines, or the Rotables, other than parts pooling agreements in the Ordinary Course of Business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth in Section 3.10(b) of the Seller Disclosure Schedules, the Company is not currently leasing any Aircraft or Engines to a third-party lessee.

**Section 3.11&nbsp;&nbsp;&nbsp;&nbsp;SUBSIDIARIES.** The Company does not currently own or hold any capital stock or other equity interests in any other Person, or the right or obligation to acquire (directly or indirectly) any capital stock or equity interests in any other Person or business. The Company does not have any Subsidiaries.

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**Section 3.12&nbsp;&nbsp;&nbsp;&nbsp;Licenses And Permits**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Company holds the Certificates of Public Convenience and Necessity for interstate and foreign charter air transportation issued by the Secretary of Transportation and an Air Carrier Certificate issued by the FAA Administrator pursuant to Chapter 447 of Title 49, United States Code, permitting Domestic, Flag, and Supplemental operations under Part 121 of Title 14, Code of Federal Regulations (collectively, the "<u>Air Certificates</u>"), and such other consents, registrations, notices, waivers, exemptions, approvals, confirmations, clearances, permits, certificates, orders, and authorizations obtained, or required to be obtained, from Governmental Authorities the loss or termination of which would materially adversely affect the operation of the Business (collectively, the "<u>Permits</u>"), all of which are identified in Section 3.12(a) of the Seller Disclosure Schedules.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;With respect to the Permits: (i) each Permit is in full force and effect in accordance with its terms; (ii) no outstanding written notice or communication of any noncompliance, revocation, cancellation or termination of any Permit has been received by the Company; (iii) except as set forth in Section 3.12(b) of the Seller Disclosure Schedules, there are no notices of material violation, orders of forfeiture, complaints, investigations, or proceedings by or before the FAA, DOT or any other Governmental Authority other than notices of violations or complaints in the Ordinary Course of Business nor are there any Action or Governmental Orders against the Company pending or threatened in writing, or to the Seller's Knowledge, threatened orally, that seek the revocation, cancellation, termination, or adverse modification of any Permit; (iv) no condition exists, no event has occurred that would permit (whether with or without notice, lapse of time or the occurrence of any other event) and neither this Agreement, the Related Agreements, nor the transactions contemplated hereby or thereby would permit the suspension or revocation of such Permit other than by expiration of the term set forth therein; and (v) the Permits listed in Section 3.12(a) of the Seller Disclosure Schedules constitute all of the Permits necessary for the Company for the operation of the Business as now being conducted with respect to its supplemental and not domestic or flag operations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Company has timely filed all material submissions, reports, registrations, schedules, forms, statements, and other documents, together with any amendments required to be made with respect thereto, that it was required to file in the past two years with (i) the FAA, (ii) the DOT, (iii) any state or other federal regulatory authority, (iv) any foreign regulatory authority and (v) all Governmental Authorities, and in each case has paid all fees and assessments due and payable in connection therewith. The Company is a Citizen of the United States.

**Section 3.13&nbsp;&nbsp;&nbsp;&nbsp;Taxes**. Except as set forth in <u>Section 3.13 of the Seller Disclosure Schedules</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Company has filed on a timely basis (taking into account all extensions of time to file that were automatic or that have been granted) all Income Tax Returns and all other material Tax Returns that are required to have been filed by or with respect to it. All such Tax Returns are accurate and complete in all material respects and were prepared in substantial compliance with all Applicable Law. The Company currently is not the beneficiary

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of any extension of time (other than automatic extensions of time not requiring the consent of any Taxing Authority) within which to file any Tax Return which Tax Return has not yet been filed. All Taxes shown as due and owing by the Company on each Tax Return filed by the Company (and all other material Taxes due and owing by the Company) have been paid by or on behalf of the Company in full. There are no Encumbrances for Taxes (other than Permitted Encumbrances) upon any of the properties or assets of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;In the last seven (7) years, the Company has not received written notice of any claim by a Taxing Authority in a jurisdiction where the Company does not file Tax Returns or pay Taxes that it is or may be required to file Tax Returns in, or is subject to taxation by, that jurisdiction. The Company is not subject to any currently effective waiver of any statute of limitations in respect of Taxes or has agreed to any currently effective extension of time for the assessment or collection of any Tax.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Company has withheld and paid to the proper Governmental Authorities (to the extent due and owing) all material Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;No (i) written dispute or claim concerning any Liability for Taxes of the Company has been raised by any Taxing Authority which has not been resolved, (ii) audit, examination, or other legal or administrative proceeding with respect to Tax Returns of the Company is currently in progress, and the Company has not received any written notice from a Taxing Authority indicating an intent to open an audit or examination related to Tax matters, and (iii) statute of limitations has been waived for the assessment of tax or extended the time for the assessment or collection of any Tax or deficiency, which waiver or extension remains in effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;The Company is not a party to or bound by any Tax Sharing Agreement. The Company (i) has not been a member of an affiliated, consolidated, unitary, combined or similar Tax group for purposes of filing an income Tax Return, other than a group of which Harbor Diversified Inc. or the Seller is the common parent or (ii) has no Liability for the Taxes of any other Person under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by Contract (excluding for the avoidance of doubt any commercial agreement entered into in the Ordinary Course of Business the primary purpose of which does not relate to Taxes) or otherwise by operation of Applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;The Company is not a partner for Tax purposes with respect to any joint venture, partnership, or other arrangement or Contract which is treated as a partnership for Tax purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;The Company will not be required to include any material item of income in, or exclude any material item of deduction from, taxable income for any taxable period or portion thereof ending after the Closing Date as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;any adjustment under Section 481 of the Code (or any comparable provision of state, local or foreign laws) resulting from any change in method of

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accounting, or use of an improper method of accounting, for a taxable period ending on or prior to the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;the use of the installment sale method or open transaction method to report a disposition of property occurring on or prior to the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;a prepaid amount received or deferred revenue accrued on or before the Closing Date other than those reflected in the Financial Statements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;any closing agreement under Section 7121 of the Code (or any comparable provision of state, local or foreign laws) executed on or before the Closing Date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;any inclusion under Section 951(a) or Section 951A of the Code attributable to (A) "subpart F income," within the meaning of Section 952 of the Code, (B) direct or indirect holding of "United States property," within the meaning of Section 956 of the Code or (C) "global intangible low-taxed income," as defined in Section 951A of the Code, in each case, determined as if the relevant taxable years ended on the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;The Seller is, and at all times since January 2005 has been, properly treated as a C corporation for federal (and applicable state and local) Income Tax purposes. The Company is, and at all times since it converted to a limited liability company in January 2017 has been, properly treated as a disregarded entity or partnership for federal (and applicable state and local) Income Tax purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;The Company (i) is not, and has not been at any time since December 31, 2018, a United States real property holding company (as defined in Section 897(c)(2) of the Code), (ii) has never owned any equity interest in a "controlled foreign corporation" within the meaning of Section 957 of the Code, and (iii) has not made any election under Code Section 965(h) to defer the payment of any "net tax liability" as such term is defined in Code Section 965(h)(6).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;The Company has properly collected and remitted all material sales Taxes, use Taxes, surtaxes, and similar Taxes with respect to sales made to its customers, and retained any documents necessary to support any exemptions therefrom.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;&nbsp;&nbsp;&nbsp;The Company has complied in all material respects with all "escheat," "abandoned property," "unclaimed property," or other similar laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)&nbsp;&nbsp;&nbsp;&nbsp;The Company has not applied for any Tax ruling or other guidance or entered into a closing agreement as described in Section 7121 of the Code (or any corresponding or similar provision of state, local, or foreign Tax Law) or any other agreement or contract with respect to Taxes with any Taxing Authority, which ruling, guidance, or agreement will be binding on the Company after the Closing. The Company has not granted a power of attorney that is currently in effect with respect to any Tax matters.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)&nbsp;&nbsp;&nbsp;&nbsp;The Company has never participated in any "listed transaction" within the meaning of Section 6707A(c)(2) of the Code or Treasury Regulation Section 1.6011-4 (or any corresponding or similar provision of state, local or non-U.S. law).

This Section 3.13 (together with other representations and warranties in Article III that refer to Taxes or the Code) represents the sole representations and warranties of the Seller and the Company with respect to any Tax matters. Notwithstanding anything to the contrary in this Agreement, neither the Seller nor the Company makes any representation or warranty as to the amount of, or limitations on, any net operating losses, Tax credits, Tax basis or other Tax attributes of the Company in any Tax period (or portion thereof) beginning after the Closing Date.

**Section 3.14&nbsp;&nbsp;&nbsp;&nbsp;Compliance With Law**. To Seller's Knowledge, the Company is in compliance in all material respects with all Applicable Law that is applicable to it or to the conduct or operation of its business or the ownership or use of any of its assets. To Seller's Knowledge, no event has occurred or circumstance exists that (with or without notice or lapse of time) could reasonably be expected to constitute or result in the Company violating, or failing to comply with, any Applicable Law in any material respect. The Company has not received any written notice or other communication, or to the Seller's Knowledge, any oral notice, from any Governmental Authority or other Person regarding any material actual, alleged, or potential violation of, or failure to comply with, any Applicable Law that would have a Material Adverse Effect.

**Section 3.15&nbsp;&nbsp;&nbsp;&nbsp;Assets Of The Company**. The Company owns (with good and marketable title in the case of real property) all of the properties and assets (whether real, personal or mixed and whether tangible or intangible) that it purports to own, including the properties and assets reflected in the Interim Balance Sheet, free and clear of any and all Encumbrances (other than those Encumbrances listed on <u>Section 3.15 of the Seller Disclosure Schedules</u>, each of which will be terminated and satisfied at the Closing).

**Section 3.16&nbsp;&nbsp;&nbsp;&nbsp;Real Estate.** <u>Section 3.16(a) of the Seller Disclosure Schedules</u> sets forth a complete and accurate list of: (a) all real property owned by the Company; and (b) all real property leased by or licensed to the Company (the "<u>Leased Real Property</u>" and together with all real property owned by the Company, the "<u>Real Property</u>"). All leases, licenses, and other occupancy agreements pursuant to which the Company leases, licenses, or otherwise occupies the Leased Real Property (the "<u>Leases</u>") are set forth on <u>Section 3.16(b) of the Seller Disclosure Schedule</u>. True, correct, and complete copies of all Leases have been delivered to the Buyer. With respect to each Lease: (i) such Lease is valid, binding, enforceable, and in full force and effect; (ii) neither the Company nor, to the Seller's Knowledge, any landlord is in breach of or default under (or alleged to be in breach of or default under) such Lease, and no event has occurred or circumstance exists that, with notice or the passage of time or both, would reasonably be expected to constitute or result in a material breach of or default under such Lease; (iii) the Company has not received any written notice or other communication, or to the Seller's Knowledge, oral notice, from any landlord or other Person regarding any actual, alleged, possible, or potential breach of or default under such Lease, or any actual, proposed, possible or potential termination, cancellation, or modification thereof which remains unresolved; (iv) to the Seller's Knowledge, there are no subleases or

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subtenancies of any space covered by such Lease; (v) no consent or approval of any landlord is required in connection with the transactions contemplated hereby, except as set forth on <u>Section 3.16(c) of the Seller Disclosure Schedule</u>; and (vi) the Company has paid all rent and other amounts due and payable under such Lease. To the Seller's knowledge, the Real Property complies in all material respects with, and is presently being used in compliance in all material respects with, all Applicable Laws.

**Section 3.17&nbsp;&nbsp;&nbsp;&nbsp;Environmental Matters**. The Company is currently and has at all times been in compliance with all Environmental Laws in all material respects.

**Section 3.18&nbsp;&nbsp;&nbsp;&nbsp;Employee Benefit Plans.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Section 3.18(a) of the Seller Disclosure Schedules sets forth a true and complete list of each Benefit Plan. For each Benefit Plan, the Seller has made available to the Buyer accurate, current, and complete copies of each of the following: (i) the plan document with all amendments, or if not reduced to writing, a written summary of all plan terms; (ii) any written contracts and arrangements related to such Benefit Plan, including trust agreements or other funding arrangements, and insurance policies, certificates and contracts; (iii) the current summary plan description and any summaries of material modifications; (iv) the most recent annual financial statements and actuarial reports; (v) in the case of a Benefit Plan intended to be qualified under Section 401(a) of the Code, the most recent favorable determination or national office approval letter issued by the Internal Revenue Service and any legal opinions issued thereafter with respect to the Benefit Plan's continued qualification; (vi) the three most recent Form 5500s and accompanying schedules filed with respect to such Benefit Plan; (vii) the written results of all required compliance testing for the prior three years; and (viii) copies of any material notices, audits, inquiries, or other correspondence from, or filings with, any Governmental Authority relating to the Benefit Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Company has not incurred and does not reasonably expect to incur any Liability under Title I or Title IV of ERISA, any related provisions of the Code, or Applicable Law relating to any Benefit Plan. No complete or partial termination of any Benefit Plan has occurred or is expected to occur.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;No event has occurred and no condition exists that would subject the Company by reason of its affiliation with any ERISA Affiliate to any Tax, penalty, fine, lien, or other Liability imposed by ERISA, the Code or other Applicable Laws, in each case, in respect of any employee benefit plan maintained, sponsored, contributed to, or required to be contributed to by any ERISA Affiliate (other than the Company).

**Section 3.19&nbsp;&nbsp;&nbsp;&nbsp;Labor And Employment Matters**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Company is in compliance in all material respects with all Applicable Laws pertaining to employment and employment practices, including all Applicable Laws relating to labor relations, equal employment opportunities, fair employment practices, employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages, hours, overtime compensation, child labor, hiring, promotion

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and discharge of employees, working conditions, meal and break periods, privacy, health and safety, workers' compensation, leaves of absence, paid sick leave, WARN, and unemployment insurance. To the Seller's knowledge, the Company is in compliance in all material respects with, and has complied in all material respects with, all immigration laws, including Form I-9 requirements and any applicable mandatory E-Verify obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Seller has made available to the Buyer lists of all individuals who are employees, independent contractors, or consultants of the Company as of the date hereof, including any employee who is on layoff or a leave of absence of any nature, paid or unpaid, authorized or unauthorized, and sets forth for each such individual the following: (i) name; (ii) title or position (including whether full-time or part-time); (iii) hire or retention date; (iv) current annual base compensation rate or contract fee; and (v) commission, bonus, or other incentive-based compensation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;All individuals characterized and treated by the Company at any time as independent contractors or consultants are or were, as appropriate, properly treated as independent contractors under all Applicable Laws. All employees of the Company at any time classified as exempt under the Fair Labor Standards Act and state and local wage and hour laws are or were, as appropriate, properly classified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;Except as disclosed in Section 3.19(d) of the Seller Disclosure Schedules, there are no Actions against the Company pending or threatened in writing, or to the Seller's Knowledge, threatened orally, to be brought or filed, by or with any Governmental Authority or arbitrator in connection with the employment of any current or former applicant, employee, consultant, volunteer, intern, or independent contractor of the Company, including any charge, investigation or claim relating to unfair labor practices, equal employment opportunities, fair employment practices, employment discrimination, harassment, retaliation, reasonable accommodation, disability rights or benefits, immigration, wages, hours, overtime compensation, employee classification, child labor, hiring, promotion and termination of employees, working conditions, meal and break periods, privacy, health and safety, workers' compensation, leaves of absence, paid sick leave, WARN Act, unemployment insurance, or any other employment related matter arising under Applicable Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;Other than the labor relationships and union contracts disclosed in Section 3.19(e)(i) of the Seller Disclosure Schedules, the Company is not a party to, or bound by, any collective bargaining agreement or other Contract with a union, works council, or labor organization (collectively, "<u>Unions</u>"), and there is not any other Union representing or purporting to represent any employee of the Company. To the Seller's Knowledge, no Union or group of employees is currently organizing employees for the purpose of collective bargaining. In the last five year period, there has not been any strike, slowdown, work stoppage, lockout, concerted refusal to work overtime or other similar labor disruption or dispute affecting the Company. Other than the labor relationships disclosed in <u>Section 3.19(e)(i) of the Seller Disclosure Schedules</u>, the Company has no duty to bargain with any Union. Other than the grievances and unfair labor practice charges disclosed in <u>Section 3.19(e)(ii) of the Seller Disclosure Schedules</u>, no material grievances or unfair labor practice charges are pending or threatened in writing to be

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brought or filed, against the Company. The Union contracts and any arbitration decisions applicable to the Company either: (i) do not prevent or affect the transactions contemplated by this Agreement; or (ii) the Company has fully complied with any Contract provisions and/or arbitration decisions that could prevent or affect the transactions contemplated by this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;The Company has complied in all material respects with the Worker Adjustment and Retraining Notification Act ("<u>WARN Act</u>") and any state or local law applicable to the Company that is similar to the WARN Act.

**Section 3.20&nbsp;&nbsp;&nbsp;&nbsp;Material Contracts**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Section 3.20(a) of the Seller Disclosure Schedules lists each Contract to which the Company is a party or by which it is bound that is material to the Company and/or its business and that: (i) involves aggregate consideration in excess of [\*\*\*] and that cannot be cancelled by the Company without penalty or without more than [\*\*\*] notice; (ii) requires the Company to purchase its total requirements of any product or service from a third party or that contain "take or pay" provisions in excess of [\*\*\*]; (iv) relates to the acquisition or disposition by the Company of any business; (v) is with any broker, finder, distributor, dealer, manufacturer's representative, or franchisor in excess of [\*\*\*]; (vi) is with any employee or independent contract that is not cancellable by the Company without material penalty or without more than [\*\*\*] notice in excess of [\*\*\*]; (vii) evidences or relates to any Indebtedness of the Company in excess of [\*\*\*]; (viii) is with any Governmental Authority, or represents a prime or subcontract with any Governmental Authority in excess of [\*\*\*]; (ix) relates to a joint venture, partnership or similar relationship; (x) is with the Seller or any Affiliate; (xii) contains a "most favored nations" or similar provision; (xiii) purports to restrict the Company or prohibits the Company from directly or indirectly engaging in any business; or (xv) is with a Union (collectively, "<u>Material Contracts</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Each Material Contract is valid and binding on the Company in accordance with its terms and is in full force and effect. None of the Company or, to the Seller's Knowledge, any other party thereto is in breach of or default under (or is alleged to be in breach of or default under), or has provided or received any notice of any intention to terminate or renegotiate, any Material Contract.

**Section 3.21&nbsp;&nbsp;&nbsp;&nbsp;Insurance**. <u>Section 3.21 of the Seller Disclosure Schedules</u> lists all current policies or binders of insurance maintained by the Company and relating to the assets, business, operations, employees, officers and directors of the Company (collectively, the "<u>Insurance Policies</u>"). The Insurance Policies: (a) are in full force and effect; (b) are valid and binding in accordance with their terms; (c) are provided by carriers who are financially solvent; and (d) have not been subject to any lapse in coverage. The Company has not received any written notice of cancellation of, premium increase with respect to, or alteration of coverage under, any of the Insurance Policies. All premiums due on the Insurance Policies have been paid. The Company is not in default under, and has not otherwise failed to comply with, in any material respect, any provision contained in any Insurance Policy.

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**Section 3.22&nbsp;&nbsp;&nbsp;&nbsp;Intellectual Property**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Section 3.22(a) of the Seller Disclosure Schedules lists all of the issued patents, trademark registrations, copyright registrations and domain name registrations owned by the Company, and all applications for any of the foregoing, including, as applicable: (i) the jurisdiction where the application or registration is located; (ii) the application or registration number; and (iii) the application or registration date (collectively, the "<u>Intellectual Property Registrations</u>"). The Company owns all Intellectual Property Registrations free and clear of all Encumbrances, except Permitted Encumbrances. The Company is not bound by any outstanding judgment, injunction, order or decree restricting the use of such Intellectual Property Registrations, or restricting the licensing thereof to any Person. All such issued/registered Intellectual Property Registrations are subsisting, in full force and effect and, to the Seller's Knowledge, valid in all material respects. The Company has paid all maintenance fees and made all filings required to maintain the Company's ownership and avoid expiration thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Section 3.22(b) of the Seller Disclosure Schedules lists all unregistered trademarks, service marks, brands, certification marks, logos, trade dress, or trade names owned by the Company that are material to its business as currently conducted ("<u>Unregistered Trademarks</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Section 3.22(c) of the Seller Disclosure Schedules lists all Company owned (i) proprietary Software, (ii) social media accounts, and (iii) domain names. No Company owned software contains any open source code that would, for any reason, require the public disclosure of the code for any Company owned software, the payment of any monies to any third party as a result of the use of such Software, or that restricts the Company's use of such Software in any way.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;In the last three years, the Company has not received any written claim, allegation, or other written notice of Intellectual Property infringement relating to the operation of the business of the Company, nor any written challenge to the ownership or validity of any of the Intellectual Property rights owned by the Company, nor is there any Action pending against the Company charging it with, or to the Seller's Knowledge, threatening, infringement, dilution, misappropriation, or other violation of any Intellectual Property of any other Person. The operation of the business of the Company, including its products, process, and services, does not infringe, misappropriate, dilute, or otherwise violate the Intellectual Property rights owned by any other Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;To the Sellers' Knowledge, none of the Intellectual Property owned by the Company is being infringed, misappropriated, diluted, or otherwise violated by any other Person. There is no Action pending in which the Company has charged any other Person with infringement, misappropriation, dilution, or other violation of any Intellectual Property owned by the Company. The Company has not, in writing, accused any other Person with infringement, misappropriation, dilution, or other violation of any Intellectual Property owned by the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;The Company is the sole and exclusive legal and beneficial owner of all right, title, and interest in and to the Intellectual Property owned and by the Company, including the Intellectual Property Registrations and Unregistered Trademarks, and the Company has the valid and enforceable right to use all other Intellectual Property used in its business in the same manner as currently conducted by the Company immediately prior to and as of the Closing Date. The Intellectual Property owned or licensed by the Company constitutes all Intellectual Property that is necessary for the operation of the business of the Company in the same manner as currently conducted by the Company immediately prior to the Closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;Except as would not reasonably be expected to have a Material Adverse Effect, the Company has taken commercially reasonable steps to protect and maintain all material Intellectual Property and to preserve the confidentiality of any trade secrets comprised in such Intellectual Property.

**Section 3.23&nbsp;&nbsp;&nbsp;&nbsp;Computer Systems And Data Privacy**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Computer Systems: (i) adequately meet the data processing and other computing needs of the Company and its business and operations as presently conducted; (ii) function, operate, process and compute in all material respects in accordance with all Applicable Laws, industry standards and trade practices. The Company has in place appropriate back-up systems and disaster recovery plans, procedures and facilities necessary to ensure the continuing availability of the functionality provided by the Computer Systems in the event of any malfunction or other form of disaster affecting the Computer Systems and has taken all reasonable steps and implemented all reasonable procedures to safeguard the Computer Systems and prevent unauthorized access thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Company complies, and at all times during the five year period prior to the Closing Date, has complied, in all material respects with all of the following in the conduct of the business of the Company: (i) applicable Privacy Laws; (ii) applicable industry standards, guidelines, and best practices, and (iii) contractual requirements or terms of use concerning the Processing of Personal Information or other confidential business information to which the Company is or was a party or otherwise bound. The Company has implemented and maintained reasonable measures, including physical, technical, and administrative security programs, policies, procedures, to protect Personal Information and other confidential information from destruction, loss, alteration, damage, unauthorized access or disclosure or illegal or unauthorized Processing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Since the past five (5) years, the Company has not been subject to any Data Breach. At no time has the Company notified and, to the Seller's Knowledge, there have been no facts or circumstances that would require the Company to notify, any Governmental Authority or other Person of any Data Breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;The Company has not received any notice, request, claim, complaint, correspondence, or other communication in writing from any Governmental Authority or other Person, and to the Sellers' Knowledge there has not been any audit (other than in the ordinary course), investigation, enforcement action (including any fines or other sanctions), or other

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Action, relating to any actual, alleged, or suspected Data Breach or violation of any Privacy Law, Business Privacy and Data Security Policy, or Person's individual privacy rights involving Personal Information in the possession or control of the Company, or held or Processed by any vendor, processor, or other third party for or on behalf of the Company, in the conduct of the business of the Company, and there are no facts or circumstances that would reasonably be expected to give rise to any of the foregoing.

**Section 3.24&nbsp;&nbsp;&nbsp;&nbsp;Affiliate Transactions**. Neither the Seller nor any of its Affiliates, directly or indirectly: (a) has had any business dealings, or is a party to any Contract, with the Company, other than business dealings or Contracts listed on <u>Section 3.24 of the Seller Disclosure Schedules</u>, each of which has been conducted in the Ordinary Course of Business at substantially prevailing market prices and on substantially prevailing market terms; or (b) is or has been engaged in competition with the Company.

**Section 3.25&nbsp;&nbsp;&nbsp;&nbsp;Brokers**. No broker, finder, or investment banker is entitled to any brokerage, finder's, or other fee or commission in connection with the transactions contemplated by this Agreement or any Related Agreement based upon arrangements made by or on behalf of the Seller or the Company or their Affiliates.

**Section 3.26&nbsp;&nbsp;&nbsp;&nbsp;Exclusivity Of Representations And Warranties.** The representations and warranties made by the Seller in this <u>Article III</u> are the exclusive representations and warranties made by the Seller. The Seller hereby disclaims any other express or implied representations or warranties with respect to such matters, and if made, such other representations and warranties may not be relied upon by Buyer or its Affiliates. It is understood and agreed that any due diligence materials made available to Buyer or its Affiliates, do not and shall not be deemed to, directly or indirectly, contain representations or warranties of the Seller or any of its Affiliates, all of which are disclaimed by the Buyer.

**ARTICLE IV<br>REPRESENTATIONS AND WARRANTIES OF THE BUYER**

The Buyer represents and warrants to the Seller that the statements contained in this <u>Article IV</u> are true and correct as of the date hereof and as of the Closing Date.

**Section 4.01&nbsp;&nbsp;&nbsp;&nbsp;Organization And Authority Of The Buyer; Enforceability.** The Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Texas. The Buyer is solely owned and controlled only by Citizens of the United States. The Buyer has full corporate power and authority to enter into this Agreement, the Related Agreements to which the Buyer is a party, and the documents to be delivered hereunder and thereunder, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution, delivery, and performance by the Buyer of this Agreement, the Related Agreements to which the Buyer is a party, and the documents to be delivered hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all requisite action on the part of the Buyer. This Agreement, the Related Agreements to which the Buyer is a party,

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and the documents to be delivered hereunder and thereunder have been duly executed and delivered by the Buyer, and (assuming due authorization, execution, and delivery by the Seller) this Agreement, the Related Agreements to which the Buyer is a party, and the documents to be delivered hereunder and thereunder constitute legal, valid, and binding obligations of the Buyer enforceable against the Buyer in accordance with their respective terms, except as may be limited by the Enforceability Exceptions.

**Section 4.02&nbsp;&nbsp;&nbsp;&nbsp;No Conflicts; Consents.** The execution, delivery and performance by the Buyer of this Agreement, the Related Agreements to which the Buyer is a party, and the documents to be delivered hereunder and thereunder, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) violate or conflict with the certificate of formation, limited liability company agreement or other Charter Documents of the Buyer; or (b) violate or conflict with any judgment, order, decree, statute, law, ordinance, rule, or regulation applicable to the Buyer, except where the violation or conflict would not, individually or in the aggregate, have a material adverse effect on the Buyer's ability to consummate the transactions contemplated hereby on a timely basis. Except for consents, registrations, notices, waivers, exemptions, approvals, confirmations, clearances, permits, certificates, orders, and authorizations as may be required to be obtained from, or delivered to, as applicable, the FAA, DOT, DOD, and FCC, no other consent, registration, notice, waiver, exemption, approval, confirmation, clearance, permit, certificate, order, or authorization is required to be obtained by the Buyer from any person or entity (including any Governmental Authority) in connection with the execution, delivery, and performance by the Buyer of this Agreement and the consummation of the transactions contemplated hereby.

**Section 4.03&nbsp;&nbsp;&nbsp;&nbsp;Investment Purpose.** The Buyer is acquiring the Membership Interests solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any distribution thereof. The Buyer acknowledges that the Membership Interests are not registered under the Securities Act of 1933, as amended, or any state securities laws, and that the Membership Interests may not be transferred or sold except pursuant to the registration provisions of the Securities Act of 1933, as amended or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable.

**Section 4.04&nbsp;&nbsp;&nbsp;&nbsp;Brokers.** No broker, finder or investment banker is entitled to any brokerage, finder's, or other fee or commission in connection with the transactions contemplated by this Agreement or any Related Agreement based upon arrangements made by or on behalf of the Buyer or its Affiliates.

**Section 4.05&nbsp;&nbsp;&nbsp;&nbsp;Legal Proceedings.** There is no Action pending or, to the Buyer's knowledge, threatened against or by the Buyer or any Affiliate of the Buyer that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement, except any Actions that would not, individually or in the aggregate, have a material adverse effect on the Buyer's ability to consummate the transactions contemplated hereby on a timely basis. To the Buyer's knowledge, no such Action has been threatened and no event has occurred or circumstance exists that could reasonably be expected to give rise to or serve as the basis for the commencement of any such Action.

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**Section 4.06&nbsp;&nbsp;&nbsp;&nbsp;Financing**. The Buyer has, as of the date hereof, and will have, on the Closing Date, funds sufficient to (a) pay the Estimated Closing Payment (including any adjustments pursuant to Section 2.03, if any), (b) pay any and all the fees and expenses required to be paid by the Buyer in connection with this Agreement and the Related Agreement, and (c) satisfy all of the other payment obligations of the Buyer contemplated hereunder.

**Section 4.07&nbsp;&nbsp;&nbsp;&nbsp;Compliance With Law**. To Buyer's Knowledge, the Buyer is in compliance in all material respects with all Applicable Law that is applicable to it or to the conduct or operation of its business or the ownership or use of any of its assets. To Buyer's knowledge, no event has occurred or circumstance exists that (with or without notice or lapse of time) could reasonably be expected to constitute or result in the Buyer violating, or failing to comply with, any Applicable Law in any material respect. The Buyer has not received any written notice or other communication, or to the Buyer's Knowledge, any oral notice, from any Governmental Authority or other Person regarding any material actual, alleged, or potential violation of, or failure to comply with, any Applicable Law that would have a material adverse effect on the ability of Buyer to consummate the transactions contemplated hereby.

**Section 4.08&nbsp;&nbsp;&nbsp;&nbsp;No Other Representations And Warranties**. The representations and warranties made by the Buyer in this Article IV are the exclusive representations and warranties made by the Buyer. The Buyer hereby disclaims any other express or implied representations or warranties with respect to such matters, and if made, such other representations and warranties may not be relied upon by the Seller or its Affiliates. The Buyer acknowledges that it has had the opportunity to conduct due diligence and investigation with respect to Company and the Business and has completed such due diligence and investigation to its satisfaction.

**ARTICLE V<br>PRE-CLOSING COVENANTS; CLOSING**

**Section 5.01&nbsp;&nbsp;&nbsp;&nbsp;Operation Of The Company Prior To The Closing.** From the date hereof through the Closing or the earlier termination of this Agreement (the "<u>Pre-Closing Period</u>"), except as disclosed in Section 5.01 of the Seller Disclosure Schedules which such matters are explicitly allowed, the Seller shall, and shall cause the Company to, operate in the Ordinary Course of Business and shall use its reasonable commercial efforts consistent with the Ordinary Course of Business to preserve intact the Company's current business organization and to keep the services of personnel necessary to sustain operations at levels sufficient to preserve the validity and currency of all Permits and the FAA Part 121 Air Carrier Certificate, except where any failure to do so would not reasonably be expected to have a Material Adverse Effect, and shall continue to interact with current customers, suppliers, licensors, licensees, distributors, landlords, creditors, employees, agents and others having business relationships with the Company in a manner consistent with past practice; provided, that nothing shall obligate the Company to resume, renew or take similar actions with respect to any operations or business relationships that have been terminated or suspended as of date hereof. In addition (and without limiting the generality of the foregoing), except as disclosed in Section 5.01 of the Seller Disclosure Schedules, the Seller shall, and shall cause the Company to:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;continue aircraft maintenance practices in the Ordinary Course of Business and in accordance with Applicable Law with respect to the Aircraft listed in Part 1 of Schedule 1.01(a);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;maintain in effect all Material Contracts, material Company consents, registrations, notices, waivers, exemptions, approvals, confirmations, clearances, permits, certificates, orders, and authorizations obtained from, or delivered to, as applicable, the FAA, DOT, DOD AND FCC, and any other relevant Governmental Authorities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;maintain flight operations and related activities (including crew training, checking and qualification, maintenance and recordkeeping) at levels sufficient to preserve the validity, currency, and fitness determinations of all Permits and certificates, including the FAA Part 121 Air Carrier Certificate and associated operations specifications, and to avoid any dormancy or lapse that would reasonably be expected to require recertification or revalidation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;notify Buyer of (i) any planned, proposed, or ongoing changes to operations and material communications from the FAA, DOT, DOD and FCC, and any other relevant Governmental Authorities; and (ii) any event, change, or development that has or would reasonably be expected to have a material adverse effect on Buyer's consummation of this transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;not take action that would have been required to be disclosed pursuant to Section 3.08 had such action been taken prior to the date of this Agreement without the prior written consent of the Buyer (which consent shall not be unreasonably withheld, conditioned or delayed); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;provide Buyer with prompt written notice of any resignation or termination of the Chief Pilot, Director of Operations, Director of Maintenance or Director of Safety (or any equivalent required management position).

**Section 5.02&nbsp;&nbsp;&nbsp;&nbsp;Financing Efforts Of Buyer.** During the Pre-Closing Period, the Buyer shall use its commercially reasonable efforts in connection with continuing to maintain its ability to finance and pay for all financial obligations hereunder and shall notify the Seller of any matter that would adversely impact its ability to pay for all such financial obligations; provided that any such notification shall not waive any corresponding indemnity claim of the Seller.

**Section 5.03&nbsp;&nbsp;&nbsp;&nbsp;Excluded Assets**. The parties acknowledge and agree that prior to the Closing, the Seller may cause the Company to assign, transfer or otherwise distribute to the Seller or its Affiliates or other third parties all assets of the Company set forth on <u>Schedule 5.03</u> or sell certain assets pursuant to the Asset Purchase Agreements (collectively, "<u>Excluded Assets</u>"). Notwithstanding anything to the contrary, Buyer hereby forever irrevocably releases and discharges Seller, its Affiliates, any transferees of the Excluded Assets and their respective Affiliates, equity holders, managers, directors, officers, employees, representatives and advisors from any and all kind of action, proceeding, claim of whatsoever kind or character with respect to the Excluded Assets.

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**Section 5.04&nbsp;&nbsp;&nbsp;&nbsp;Other Pre-closing Covenants**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;On the terms and subject to the conditions of this Agreement, during the Pre-Closing Period each party hereto shall (i) use its reasonable commercial efforts to cause the Closing to occur as promptly as practicable, including actions necessary to comply promptly with all Applicable Laws that may be imposed on it or any of its Affiliates with respect to the Closing and (ii) use its reasonable commercial efforts to cause its obligations to satisfy conditions to Closing to be satisfied, and refrain from taking any action that could reasonably result in any of the conditions to Closing not being satisfied. In addition, during the Pre-Closing Period the Seller shall use its reasonable commercial efforts to obtain, and cooperate in obtaining, all material consents, approvals and authorizations from third parties necessary or appropriate to permit the consummation of the transactions contemplated hereby and under the Related Agreements as promptly as practicable; provided, however, that each party hereto shall use commercially reasonable efforts to cooperate with the other parties to this Agreement in obtaining all consents, approvals and authorizations. Each party shall bear its own expenses incurred in connection with seeking and obtaining any required consent or approval of the DOT or FAA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;During the Pre-Closing Period, the Seller shall, and shall cause the Company to, (i) afford to the Buyer and its directors, managers, members, partners, employees, agents, attorneys, accountants, financial advisors, officers, independent contractors and its financing sources and their respective representatives reasonable access, upon reasonable advance notice during normal business hours, to all the personnel (in coordination with the Seller), properties, books, Contracts, commitments, Tax Returns and records of the Company, and shall make available to the Buyer any information concerning the Company as the Buyer may reasonably request, (ii) furnish the Buyer with such financial, operating and other data and information (including personnel files and historical employee-related data) related to the Business as the Buyer may reasonably request and (iii) instruct its representatives to cooperate with the Buyer in its investigation of the Business,

**Section 5.05&nbsp;&nbsp;&nbsp;&nbsp;Conditions To Closing**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer's obligation to consummate the transactions contemplated hereunder shall be conditioned upon the satisfaction by the Seller (or waiver by the Buyer) of each of the following conditions on or prior to Closing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;the submission of a notice of proposed substantial change in ownership of the Company to DOT in accordance with 14 CFR Part 204.5, and receipt of written confirmation from DOT that the Company will remain a Citizen of the United States and fit to conduct operations under their certificates following consummation of the transactions contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;the submission to and approval by DOT of a joint application for exemption from the certificate transfer requirement under section 41105 of Title 49, United States Code, or receipt of written confirmation from DOT, acceptable to counsel

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for the Buyer and the Seller, that a certificate transfer application is not required under section 41105 for the transactions contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;the Company's assets shall include the 14 CFR Part 121 Air Carrier Certificate and all related Permits in good standing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;the closing deliverables in <u>Section 5.06</u> shall have been delivered to the Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;each of the representations and warranties set forth in <u>Article III</u> of this Agreement (other than the Fundamental Representations) shall be true and correct in all material respects as of the Closing Date as though made on and as of the Closing Date (except to the extent in either case that such representation and warranty speaks as of another date, in which case such representation and warranty shall be true and correct as of such date);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;each of the Fundamental Representations under Article III shall be true and correct in all respects as of the Closing Date as though made on and as of the Closing Date (except to the extent that such Fundamental Representation speaks as of another date, in which case such Fundamental Representation shall be true and correct as of such date);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;the Seller shall have duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement and the Related Agreements to be performed or complied with by it prior to or on the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;there shall not have occurred or reasonably be expected to occur any Material Adverse Effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;the Seller shall have delivered a certificate to the Buyer, dated as of the Closing Date, in which the Seller certifies as to the satisfaction of the conditions described in <u>Sections 5.05(a)(v) – (viii)</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;no injunction or restraining order shall have been issued by any Governmental Authority and be in effect that restrains or prohibits any material transaction contemplated hereby;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)&nbsp;&nbsp;&nbsp;&nbsp;no Action shall have been commenced against the Seller or the Company or any of its Affiliates that would prevent the Closing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii)&nbsp;&nbsp;&nbsp;&nbsp;Harbor Diversified, Inc. has entered into the Asset Purchase Agreements, and the Asset Purchase Agreements shall close concurrently with this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Seller's obligation to consummate the transactions contemplated hereunder shall be conditioned upon the satisfaction by the Buyer (or waiver by the Seller) of the following conditions on or prior to Closing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;the submission of a notice of proposed substantial change in ownership of the Company to DOT in accordance with 14 CFR Part 204.5, and receipt of written confirmation from DOT that the Company will remain a Citizen of the United States and fit to conduct operations under their certificates following consummation of the transaction contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;submission to and approval by, DOT of a joint application for exemption from the certificate transfer requirement under section 41105 of Title 49, United States Code, or receipt of written confirmation from DOT, acceptable to counsel for the Buyer and the Seller, that a certificate transfer application is not required under section 41105 for the transaction contemplated hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;the closing deliverables in <u>Section 5.07</u> shall have been delivered to the Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;each of the representations and warranties set forth in <u>Article IV</u> of this Agreement (other than the Fundamental Representations) shall be true and correct in all material respects as of the Closing Date as though made on and as of the Closing Date (except to the extent in either case that such representation and warranty speaks as of another date, in which case such representation and warranty shall be true and correct as of such date);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;each of the Fundamental Representations set forth in Article IV shall be true and correct in all respects as of the Closing Date as though made on and as of the Closing Date (except to the extent that such Fundamental Representation speaks as of another date, in which case such Fundamental Representation shall be true and correct as of such date);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;the Buyer shall have duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement and the Related Agreements to be performed or complied with by it prior to or on the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;the Buyer shall have delivered a certificate to the Seller, dated as of the Closing Date, in which the Buyer certifies as to the satisfaction of the conditions described in <u>Sections 5.05(b)(iv) – (vi)</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;no injunction or restraining order shall have been issued by any Governmental Authority and be in effect that restrains or prohibits any material transaction contemplated hereby;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;no Action shall have been commenced against the Buyer that would prevent the Closing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;CSI Aviation, Inc. and Associated Energy Group LLC shall have entered into the Asset Purchase Agreements with Harbor Diversified, Inc., and the Asset Purchase Agreements shall close concurrently with this Agreement.

**Section 5.06&nbsp;&nbsp;&nbsp;&nbsp;The Seller's Deliveries.** At the Closing, the Seller shall deliver, or cause to be delivered, to the Buyer the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;an assignment to the Buyer, in a form reasonably satisfactory to the Buyer and the Seller, of the Membership Interests (the "<u>Membership Interest Assignment</u>") free and clear of all Encumbrances (other than restrictions on transfer arising under the Securities Act), duly executed by the Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;copies of the resignation or resignations duly executed by each member of the Board of Managers, or similar governing body, of the Company and each officer of the Company, to be effective as of the Closing or removals by the Board of Managers of the Company of each officer of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Seller certifying as to (i) the resolutions of the board of directors of the Seller, duly adopted and in effect as of the date hereof, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby, (ii) true, correct and complete copies of the Charter Documents of the Company and the Seller and (iii) good standing certificates (or its equivalent) of the Seller and the Company from the States of Delaware and Wisconsin;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;an IRS Form W-9 duly executed by the Seller;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;all Pay-Off Letters and Transaction Expense Invoices;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;the Related Agreements duly executed by the Seller, its Affiliates and/or the Company, as applicable; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;such other agreements, certificates, documents, consents, approvals and other deliverables as may be reasonably requested by the Buyer to carry out the intents and purposes of this Agreement.

**Section 5.07&nbsp;&nbsp;&nbsp;&nbsp;The Buyer's Deliveries.** At the Closing, the Buyer shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;make the payments set forth in Section 2.03(b); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;deliver, or cause to be delivered, to the Seller:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Buyer certifying as to the resolutions of the board of managers (or

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equivalent managing body) of the Buyer, duly adopted and in effect as of the date hereof, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;the Related Agreements duly executed by the Buyer or its Affiliates, as applicable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;The Membership Interest Assignment, duly executed by the Buyer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;such other agreements, certificates, documents, consents, approvals and other deliverables as may be reasonably requested by the Seller to carry out the intents and purposes of this Agreement.

**Section 5.08&nbsp;&nbsp;&nbsp;&nbsp;Closing.** Subject to the terms and conditions of this Agreement, the purchase and sale of the Membership Interests contemplated hereby shall take place at a closing (the "<u>Closing</u>") to be held no later than [\*\*\*] after the last of the conditions to Closing set forth in <u>Section 5.05</u> have been satisfied or waived (other than conditions which, by their nature, are to be satisfied on the Closing Date), remotely by exchange of documents and signatures (or their electronic counterparts), or at such other time or on such other date or at such other place as the Seller and the Buyer may mutually agree upon in writing (the day on which the Closing takes place being the "<u>Closing Date</u>").

**Section 5.09&nbsp;&nbsp;&nbsp;&nbsp;No Solicitation Of Other Bids**. During the Pre-Closing Period, without the prior written consent of the Buyer, the Seller shall not, and shall not authorize or permit any of its Affiliates (including the Company) or any of its or their Representatives to, directly or indirectly, solicit, initiate, encourage, entertain or respond to any inquiries or proposals from, discuss or negotiate with, provide any information to or consider the merits of any inquiries or proposals from any Person (other than the Buyer) or otherwise participate in a transaction or potential transaction concerning any sale of the Membership Interests, any Company assets that are not Excluded Assets, or other equity of the Company (regardless of the form of the transaction, which will include mergers, liquidations, consolidations, exchanges, transfers, and other sales involving the Company, the Membership Interests, or the Company's assets). As of the date of this Agreement, the Seller and its respective Affiliates, directors, officers, employees, equity holders, agents or representatives shall immediately cease and cause to be terminated any activities, discussions or negotiations, if any, conducted prior to the date of this Agreement with any Persons other than the Buyer with respect to any such inquiry or proposal. For the avoidance of doubt, nothing shall restrict the marketing, solicitation, or sale of the Excluded Assets nor the Seller and its Affiliates from entering into any agreements or other instruments in connection thereto.

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**ARTICLE VI<br>ADDITIONAL COVENANTS**

**Section 6.01&nbsp;&nbsp;&nbsp;&nbsp;Confidentiality.** The parties hereto shall keep the Confidential Information strictly confidential and shall not disclose the Confidential Information to any Person other than to such party's Affiliates, and to such party's and its Affiliates' respective managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives and prospective participants in connection with the transactions contemplated hereby (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such information and instructed to keep such information confidential) or as may be required by any Applicable Laws or regulations. Each party hereto further agrees to exercise care that is at least equal to the care it uses to protect the confidentiality of its own confidential and proprietary information of similar importance to prevent unauthorized disclosure or use of Confidential Information, but in no event less than commercially reasonable care. Each party hereto agrees that unauthorized disclosure of Confidential Information of the other party may cause such other party irreparable harm and that any breach or threatened breach of this Section 6.01 by either party shall entitle the other party to seek injunctive relief, in addition to any other legal and equitable remedies available to it, which remedies shall not be deemed exclusive, but shall be cumulative. In the event that either party hereto shall be legally compelled or required by any Governmental Authority to disclose any of the Confidential Information, such party shall promptly provide written notice to the other party to enable such other party to seek a protective order, in camera process or other appropriate remedy to avoid public or third-party disclosure of such Confidential Information. In the event that such protective order or other remedy is not obtained, the party hereto so legally compelled or required shall furnish only so much of such Confidential Information as it is legally compelled to disclose (upon advice of legal counsel) and shall exercise its commercially reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such Confidential Information. Such Confidential Information shall otherwise remain subject to the provision of this Section 6.01. Notwithstanding the foregoing, the parties and their Affiliates may make any disclosure and filings in connection with any securities filing or other filings required the Securities and Exchange Commission as advised by legal counsel without requiring consent of the other party.

**Section 6.02&nbsp;&nbsp;&nbsp;&nbsp;Press Releases.** Except as may be required to comply with the requirements of any Applicable Law, including any required disclosures in compliance with regulations by any Governmental Authority, neither party hereto, nor such party's Affiliates and the Company, will make a press release or information release, or make any public disclosure or otherwise provide information to any third party for release to the news media or general public, with respect to the existence or contents of this Agreement, the Related Agreements or the transactions contemplated hereby or thereby, without the prior written consent of the other party hereto, which consent shall not be unreasonably withheld (except that either party may withhold consent to public disclosure of the economic terms of the transactions contemplated hereby). In the event that any such disclosure is required by Applicable Law, the parties will consult and advise with one another regarding, and prior to making, such disclosure.

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**Section 6.03&nbsp;&nbsp;&nbsp;&nbsp;Duty To Cooperate And Approvals.** The parties shall cooperate with each other in making all necessary government filings, and in obtaining all necessary government approvals or authorizations, for the transactions contemplated hereby, and each party hereto shall provide copies of any such approvals or authorizations obtained by such party to the other party. The parties shall promptly notify the FAA FSDO with oversight of the certificates of the contemplated change in ownership and provide such information as reasonably requested. No later than [\*\*\*] following the execution of this Agreement, the Buyer and the Seller shall submit to the DOT in accordance with 14 CFR Part 204.5 the information required in 14 CFR Part 204.3, including information sufficient to establish that the Buyer is a Citizen of the United States. The Buyer and the Seller shall use commercially reasonable efforts to respond to requests for additional supporting information from the DOT within [\*\*\*] of the receipt thereof.

**Section 6.04&nbsp;&nbsp;&nbsp;&nbsp;Tax Matters**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;<u>Responsibility for Filing Tax Returns</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;The Seller shall prepare and file, at the Seller's expense, any Tax Return of the Company for any taxable period ending on or before the Closing Date (each such Tax Return, a "<u>Seller Prepared Tax Return</u>"). All such Tax Returns shall be prepared in a manner consistent with past practice of the Company in preparing its Tax Returns, except as otherwise required by Applicable Law. The Seller shall provide Seller Prepared Tax Returns to the Buyer to review and comment on such Tax Return [\*\*\*] prior to filing (or, in the case of a Tax Return that is not an Income Tax Return, as soon as reasonably practicable before the due date thereof (taking into account extensions)), provide to the Buyer information materials, including schedules and work papers reasonably requested by the Buyer to review and evaluate such draft Tax Returns, and consider in good faith any comments of the Buyer. The Seller shall pay all Taxes shown as due on such Tax Returns, except to the extent that such Taxes were taken into account as a reduction of the Final Closing Payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer shall prepare, or cause to be prepared, at the Company's expense, and file, or cause to be filed, all other Tax Returns (excluding Seller Prepared Tax Returns) of the Company including for any Straddle Period that are first due after the Closing Date. Such Tax Returns shall be prepared in accordance with past practice unless otherwise required by Applicable Law. At least [\*\*\*] prior to the due date for filing (or, in the case of a Tax Return that is not an Income Tax Return, as soon as reasonably practicable before the due date thereof (taking into account extensions)), the Buyer shall provide copies of any such Tax Returns for a Straddle Period to the Seller for its review and comment and shall provide to the Seller information materials, including schedules and work papers reasonably requested by the Seller to review and evaluate such draft Tax Returns. Buyer shall consider in good faith such revisions as are reasonably requested by the Seller within [\*\*\*] after the delivery of such Tax Returns to the Seller. If Buyer does not agree with any such revisions so requested by the Seller, any dispute shall be promptly submitted by the parties to a mutually agreed independent accounting firm for final and binding resolution. All Taxes shown as due on such Tax Returns that are allocable to Pre-Closing Straddle Periods in accordance with Section 6.04(b) shall be borne by the Seller, except to the extent that such Taxes were taken into account as a reduction of

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the Final Closing Payment. The Tax Returns prepared in accordance with this Section 6.04(a)(ii) shall comply with the provisions of Section 6.04(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;<u>Straddle Period Allocation</u>. In the case of any Taxes not described in the following sentence, including any Income Taxes and Taxes based on or measured by payroll that are payable with respect to a Pre-Closing Straddle Period, the portion of such Taxes attributable to the Pre-Closing Straddle Period will be determined on the basis of a deemed "closing of the books of the Company" as of the close of the Closing Date. In the case of any property or other ad valorem Taxes that are payable with respect to a Straddle Period, the portion of such Taxes attributable to the portion of such Straddle Period ending on the Closing Date will be equal to the product of all such Taxes multiplied by a fraction, the numerator of which is the number of calendar days in the Pre-Closing Straddle Period, and the denominator of which is the number of calendar days in the entire Straddle Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;<u>Transfer Taxes</u>. Except for taxes arising for Aircraft, Engine, and Rotable transactions (such taxes to be governed under CSI Asset Purchase Agreement, including Section 10.1), any transfer, documentary, sales, use, stamp, registration, tariffs, duties and other similar Taxes, and all conveyance fees and recording charges, incurred in connection with consummation of the acquisition of the Membership Interests and the other transactions contemplated by this Agreement (collectively, "<u>Transfer Taxes</u>") shall be borne by the Buyer. The Buyer will, at its own expense, file all necessary Tax Returns and other documentation with respect to all such Transfer Taxes, and, if required by Applicable Law and requested by the Buyer, the Buyer will join in the execution of any such Tax Returns so long as any such Tax Returns are provided to the Seller for review and comment at least [\*\*\*] prior to the filing thereof and Buyer makes all reasonable revisions requested by the Seller in respect thereof prior to filing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;<u>Tax Sharing Agreements</u>. All Tax indemnity, Tax sharing, Tax receivable, and Tax allocation or similar agreements ("<u>Tax Sharing Agreements</u>") to which the Company is a party or otherwise bound (other than commercial agreements, such as credit agreements and leases, the principal purpose of which is not Taxes) shall be terminated as of the Closing Date and, after the Closing Date, the Company shall not be bound thereby or have any rights or obligations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;<u>Cooperation</u>. The parties hereto and their respective Affiliates and agents will provide each other with such cooperation and information (including copies of Tax Returns, together with accompanying schedules, related work papers and documents relating to rulings or other determinations by tax authorities) as any of them reasonably may request in connection with any Tax matters relating to the Company or this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;<u>Tax Proceedings</u>. If the Buyer or any Affiliate receives notice of any Action that relates to Taxes or Tax Returns of the Company for any Pre-Closing Tax Period (each a "<u>Tax Proceeding</u>"), the Buyer shall promptly notify the Seller in writing. The Seller shall, at its election, be entitled to control (at the Seller's expense) any Tax Proceeding relating to a taxable period ending on or before the Closing Date (other than a Straddle Period) with counsel of its choice so long as (i) the Seller gives written notice thereof to the Buyer within [\*\*\*] after

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the Buyer has delivered written notice of the Tax Proceeding to the Seller, (ii) the Buyer shall have the right to participate in, but not control, any such Tax Proceeding (using counsel of its choice), (iii) the Seller shall keep the Buyer reasonably informed of all proceedings relating to such Tax Proceeding, and (iv) the Seller shall not settle such Tax Proceeding without the prior written consent of the Buyer (which consent shall not be unreasonably withheld, conditioned, or delayed). The Buyer shall control any Tax Proceeding, other than a Tax Proceeding that the Seller elects to control pursuant to the prior sentence, with counsel of its choice, provided that, (A) the Seller shall have the right to participate in, but not control, any such Tax Proceeding (using counsel of its choice), (B) the Buyer shall keep the Seller reasonably informed of all proceedings relating to such Tax Proceeding, and (C) the Buyer shall not settle such Tax Proceeding that relates to Taxes for a Straddle Period without the prior written consent of the Seller (which consent shall not be unreasonably withheld, conditioned, or delayed).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;<u>Refunds</u>. Any refunds of Taxes (or credit claimed in lieu of a Tax refund), including any overpayment of Taxes from a Pre-Closing Tax Period or any prepayment of Taxes in a Pre-Closing Tax Period applied to reduce Taxes in a taxable period (or portion thereof) ending after the Closing Date (each, a "<u>Post-Closing Tax Period</u>"), to the extent attributable to a Pre-Closing Tax Period of the Company, received in cash by the Buyer, the Company, or any Affiliates thereof (or, in the case of a credit, actually used by the Buyer, the Company or any Affiliates thereof to reduce Taxes for a taxable period (or portion thereof) beginning after the Closing Date otherwise payable by the Buyer, the Company or any Affiliates thereof), net of Taxes and out-of-pocket expenses incurred to obtain such Tax refunds or Tax credits (such amount, a "<u>Pre-Closing Tax Refund</u>"), shall be for the account of the Seller. The Buyer shall pay over to the Seller, in each case, any such Pre-Closing Tax Refund within [\*\*\*] after receipt thereof (or, in the case of an overpayment of Taxes from a Pre-Closing Tax Period or any prepayment of Taxes in a Pre-Closing Tax Period applied to reduce Taxes in a Post-Closing Tax Period, within five Business Days after filing the applicable Tax Return reflecting such amount). If consistent with Applicable Law, (i) any such Pre-Closing Tax Refunds will be claimed in cash rather than as a credit against future Tax liabilities, (ii) the Buyer and the Company shall reasonably cooperate with the reasonable requests of the Seller at the Seller's expense to claim any such Pre-Closing Tax Refunds, (iii) the Company shall elect to carry back items of loss, deduction or credit from any Pre-Closing Tax Period to prior taxable years to the fullest extent permitted by law and (iv) the Buyer and the Company shall reasonably cooperate with the Seller in utilizing any available short-form or accelerated procedures and in filing any amended Tax Returns to claim any potential Pre-Closing Tax Refunds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;<u>Certain Tax Actions</u>. Unless (in each case) the Seller provides the Buyer with prior written consent after the Closing, the Buyer shall not, and shall not permit the Company or any Affiliate of the foregoing, to (i) make any Tax election (including under Section 336 or Section 338 of the Code or Treasury Regulation section 301.7701-3) or change any method of accounting that would be effective in or that would otherwise impact any Pre-Closing Tax Period, (ii) amend, or except as provided in Section 6.04(a), file any Tax Return of the Company or any Subsidiary thereof that relates to a Pre-Closing Tax Period, (iii) make or cause to be made any extraordinary transactions or events on the Closing Date with respect to the Company, (iv) voluntarily approach, enter into voluntary disclosure agreement with, or file any

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ruling request with any taxing authority with respect to any Pre-Closing Tax Period or Taxes attributable to a Pre-Closing Tax Period or (v) except through the extension of time to file any Tax Return in the ordinary course, waive or otherwise extend any statute-of-limitations period with respect to any Tax or Tax Return of a Pre-Closing Tax Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;<u>Transaction Tax Deductions</u>. Transaction Tax Deductions shall be claimed in a Pre-Closing Tax Period, or otherwise treated as allocable to the Pre-Closing Tax Period (including to the portion of the Straddle Period ending on the end of the Closing Date), to the fullest extent permitted by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;<u>Purchase Price Allocation</u>. Within [\*\*\*] of the determination of the Final Closing Payment, the Buyer shall provide to the Seller a schedule allocating the purchase price (as determined for federal income tax purposes, including all amounts treated as purchase price for such purposes) among the assets of the Company (the "<u>Purchase Price Allocation Schedule</u>") excluding for the avoidance of doubt any assets transferred (and liabilities assumed) pursuant to the Asset Purchase Agreements. The Purchase Price Allocation Schedule shall be made in accordance with the applicable provisions of the Code. If within [\*\*\*] of receiving the Purchase Price Allocation Schedule, the Seller has not objected, the Purchase Price Allocation Schedule shall be final and binding. If within [\*\*\*] the Seller objects to the Purchase Price Allocation Schedule, the Seller and the Buyer shall cooperate in good faith to resolve their differences, provided that if after [\*\*\*], the Seller and the Buyer are unable to agree, the parties shall retain a firm of Independent Accountants to resolve their dispute. The determination of the Independent Accountants shall be final and binding on all parties. The cost of the Independent Accountants shall be shared equally by the Seller, on one hand, and the Buyer, on the other hand. The Seller and the Buyer hereto shall cooperate to make appropriate adjustments to the Purchase Price Allocation Schedule to reflect changes in the purchase price under this Agreement. The Seller and the Buyer agree for all Tax reporting purposes to report the transactions in accordance with the Purchase Price Allocation Schedule, as adjusted pursuant to the preceding sentence, and to not take any position during the course of any audit or other proceeding inconsistent with the agreements as to Tax treatment or the Purchase Price Allocation Schedule, as adjusted pursuant to the preceding sentence, unless required by a determination of the applicable Governmental Authority that is final.

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**Section 6.05&nbsp;&nbsp;&nbsp;&nbsp;Restrictive Covenants**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Except as disclosed in Section 6.05 of the Seller Disclosure Schedules, for a period of [\*\*\*] commencing on the Closing Date, the Seller shall not, and shall not permit any of its Affiliates to, directly or indirectly: (i) hire or solicit any current or former employee of the Company or the Buyer or encourage any such Person to leave the Company's or the Buyer's employment or engagement, except pursuant to a general solicitation that is not directed specifically to any such Person; provided, however, that nothing in this Section 6.05(a) shall prevent the Seller or its Affiliates from hiring any former employee of the Company more than [\*\*\*] after such Person's employment or engagement with the Company ends; (ii) solicit or entice, or attempt to solicit or entice, any clients or customers of the Company or the Buyer or potential clients or customers of the Company or the Buyer for purposes of diverting their business or services from the Company or the Buyer; or (iii) interfere with, or attempt to interfere with, the business relationships (whether formed prior to, on or after the Closing Date) between the Company or the Buyer and any customers, suppliers, employees, independent contractors or other business relationships of the Company or the Buyer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;From and after the Closing, neither the Seller nor the Buyer shall, directly or indirectly make any disparaging statements or communications about the other party or any of their respective employees, independent contractors, service providers, products or services; provided that this shall not apply to or prohibit statements reasonably necessary or appropriate to enforce or defend any claim arising under or in connection with this Agreement or the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Seller acknowledges that a breach or threatened breach of this Section 6.05 would irreparably harm the Buyer and the Company, such that monetary damages would not be an adequate remedy, and hereby agrees that in the event of a breach or a threatened breach of any such obligations, the Buyer and the Company (which is an express third-party beneficiary of the covenants set forth in Section 6.05) shall, in addition to any and all other rights and remedies that may be available to them in respect of such breach, be entitled to equitable relief, including a temporary restraining order, an injunction, or specific performance (without any requirement to post bond).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;The Seller acknowledges that the restrictions contained in this Section 6.05 are reasonable and necessary to protect the legitimate interests of the Buyer and the Company and constitute a material inducement to the Buyer to enter into this Agreement and consummate the transactions contemplated by this Agreement. In the event that any covenant contained in this Section 6.05 should ever be adjudicated to exceed the time, geographic, product or service, or other limitations permitted by Applicable Law in any jurisdiction or any Governmental Order, then any court is expressly empowered to reform such covenant, and such covenant shall be deemed reformed, in such jurisdiction to the maximum time, geographic, product or service, or other limitations permitted by Applicable Law or such Governmental Order. The covenants contained in this Section 6.05 and each provision hereof are severable and distinct covenants and provisions. The invalidity or unenforceability of any such covenant or provision as written shall not invalidate or render unenforceable the remaining covenants or

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provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such covenant or provision in any other jurisdiction.

**Section 6.06&nbsp;&nbsp;&nbsp;&nbsp;Release**. Effective as of the Closing, the Seller (on behalf of itself and its Affiliates and Subsidiaries) (collectively, the "<u>Seller Releasing Parties</u>") hereby releases the Buyer, the Company and its and their Affiliates and its and their members, managers, officers, directors, stockholders, partners, employees, agents and attorneys, and each of them (collectively, the "<u>Buyer Released Parties</u>"), from any and all claims, and agrees not to bring or threaten to bring or otherwise join in any claim against any of the Buyer Released Parties or any of them, relating to, arising out of or in connection with any facts or circumstances relating to the Company which existed on or prior to the Closing Date; provided, however, that the foregoing shall not apply to any rights of any Seller Releasing Party under, or any obligation of any Buyer Released Party under, this Agreement or any Related Agreement or any claim for intentional fraud.

**Section 6.07&nbsp;&nbsp;&nbsp;&nbsp;D&O Tail Insurance; Indemnification**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Seller shall cause the Company to obtain as of the Closing, the cost of which shall be borne entirely by the Seller as part of the Transaction Expenses, a "tail" insurance policy with a claims period of at least [\*\*\*] from the Closing Date, providing coverage and limits, and on terms and conditions reasonably acceptable to the Buyer, in each case with respect to claims arising out of or relating to events that occurred on or prior to the Closing Date (including in connection with the transactions contemplated by this Agreement and the Related Agreements). Such tail policy shall be the Company's pre-Closing officers, directors, managers and employees' sole source of recovery with respect to any claims covered thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp; For a period of at least [\*\*\*] from the Closing Date, the Company shall maintain provisions in its Charter Documents providing indemnification rights (including, to the extent provided and subject to the limitations in the Charter Documents of the Company, any rights to advancement of expenses and exculpation) to the full extent provided in the Charter Documents of the Company in effect as of the Closing and permitted by applicable Law, which provisions shall not be amended, repealed or otherwise modified in any manner that would affect adversely in any non de minimis respect the rights of such Persons thereunder with respect to claims regarding pre-Closing conduct, acts or omissions relating to such Persons' positions as a director or officer of the Company, unless such modification is required by applicable Law or required by any directors' and officers' liability insurance policy providing coverage which is at least as favorable to the individuals as the coverage provided by the policies currently maintained by the Company, including for claims regarding pre-Closing conduct, acts or omissions. In the event the Company or any of their successors or assigns (a) consolidate with or merge into any Person and shall not be the continuing or surviving corporation or entity in such consolidation or merger or (b) transfer all or substantially all of its properties or assets to any Person, then, in either event, proper provision shall be made such that the successors and assigns of the Company assume the obligations set forth in this <u>Section 6.07(b)</u>. The provisions of this <u>Section 6.07</u> are intended to be in addition to the rights otherwise available to such Persons by Applicable Law or

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Contract, and shall operate for the benefit of, and shall be enforceable by, each of such Persons, their heirs and their representatives.

**Section 6.08&nbsp;&nbsp;&nbsp;&nbsp;Aircraft Insurance.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;For the period commencing on the Closing Date and ending on the earlier of (a) the [\*\*\*] anniversary of the Closing Date or (b) the completion of the next "C-check" due under the applicable general maintenance manual for each Aircraft (the "Insurance Period"), Buyer will carry or cause to be carried and maintained, comprehensive airline legal liability insurance, including but not limited to third party, passenger, baggage, cargo, mail and products liability insurance including without limitation, war risk and allied perils, in an amount of not less than [\*\*\*]. Notwithstanding the foregoing, for any period of the Insurance Period that any Aircraft in storage and not being operated, Buyer may maintain (or cause to be maintained) with respect to such Aircraft and only for such period of the Insurance Period that such Aircraft is in storage and not being operated, comprehensive aviation liability insurance (including, but not limited to, contractual liability and products liability) in an amount not less than [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;All policies carried in accordance with this Section 6.08 and any policies taken out in substitution or replacement for any such policies, (i) shall include the Seller, its subsidiaries and parent organizations, and each of its and their directors, officers, shareholders, members, controlling Persons, agents, employees, subsidiaries, Affiliates, servants, successors, assigns and transferees of the foregoing parties (collectively, the "Seller Parties") as additional insureds; as respects the operation of the operator, (ii) shall be maintained with insurers of recognized standing and normally participating in the leading international commercial aviation insurance markets (through reinsurance, if necessary), (iii) shall provide that if the insurers cancel such insurance for any reason, or if the same is allowed to lapse for non-payment of premium or if any material change is made in the insurance which adversely affects the interest of the Seller Parties, such lapse, cancellation or change shall not be effective as to the Seller Parties for thirty days (seven days in the case of war risk and allied perils coverage) after written notice by such insurers of such lapse, cancellation or change, provided, however, that if any notice period specified above is not reasonably obtainable, such policies shall provide for as long a period of prior notice as shall then be reasonably obtainable, (iv) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covering each insured, (v) provide that the insurers will waive any right to any setoff, recoupment, subrogation or counterclaim or any other deduction, by attachment or otherwise, and (vi) be primary and without right of contribution from any insurance which may be carried by the Seller Parties and any of them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;If any of the Aircraft are sold or leased by the Buyer within [\*\*\*] of the date of the Closing, Buyer shall, or shall cause any follow-on lessee, operator or buyer of such Aircraft, to include the Seller Parties as an additional insured on its or on the aircraft/airline liability policy maintained by such entity which is, in the reasonable opinion of Seller Parties' insurance broker, consistent with industry standard for comparable aircraft and operators.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;For the avoidance of doubt, "aircraft" in this Section 6.08 shall include all Aircraft and all aircraft sold pursuant to the Asset Purchase Agreements and leased to, operated by or sold to Buyer.

**Section 6.09&nbsp;&nbsp;&nbsp;&nbsp;Employee Matters**. &nbsp;&nbsp;&nbsp;&nbsp;Buyer acknowledges that the Company's employees subject to a collective bargaining agreement, including the agreements set forth on <u>Section 3.19(e)(i) of the Seller Disclosure Schedules</u>, include pilots, flight attendants, mechanics, clerical, office, fleet, passenger service and related employees, and dispatchers, dispatch coordinators and dispatch trainers, and that, pursuant to those agreements between the Company and each classification of employee's representatives, will continue to be employed in accordance with the provisions of their collective bargaining agreements following the close of this transaction.

**Section 6.10&nbsp;&nbsp;&nbsp;&nbsp;Livery**. Buyer acknowledges that certain Aircraft may not be under Company livery as of the Closing. Following the Closing, none of the Buyer, the Company or any Affiliate of the Buyer or the Company shall operate any Aircraft that are under the livery of other airlines unless such airlines have provided written approval.

**Section 6.11&nbsp;&nbsp;&nbsp;&nbsp;Books And Records**. For a period of [\*\*\*] following the Closing, Buyer shall cause the Company to maintain all its books and records related to all periods prior to the Closing and shall make them available to Seller upon reasonable advance notice, including providing copies thereof and reasonable access to the Company's electronic systems upon Seller's request. All record access contemplated by this Section 6.11 shall be limited for purposes of Seller (a) preparing and filing any Tax Returns or any other report or document required to be filed with any Governmental Authority, such as DOT, the FAA or the SEC, (b) preparing financial statements or other similar reports, (c) defending or prosecuting any Actions, Tax or other audit or investigation (excluding disputes or Actions between the Buyer and the Seller or their Affiliates) or (d) complying, or verifying Seller's compliance, with any post-Closing covenants in this Agreement or any other Related Agreement.

**ARTICLE VII<br>INDEMNIFICATION**

**Section 7.01&nbsp;&nbsp;&nbsp;&nbsp;Survival.** Subject to the limitations and other provisions of this Agreement: (a) the representations and warranties contained in <u>Article III</u> and <u>Article IV</u> (other than the Fundamental Representations) and all related rights to indemnification shall remain in full force and effect and shall be enforceable until the first business day following the date that is [\*\*\*] from the Closing Date; and (b) the Fundamental Representations shall survive the Closing and remain full force and effect and shall be enforceable until [\*\*\*] from the Closing Date. All covenants and agreements set forth herein shall survive the execution and delivery of this Agreement and the Closing, and shall be enforceable, until fully performed in accordance with their respective terms. Notwithstanding the foregoing, any claims asserted by a written notice delivered in accordance with this Agreement prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the applicable survival period or any applicable statute of limitations and such claims shall survive and remain enforceable

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until finally resolved by agreement of the parties or by a final judgment of a court of competent jurisdiction. For the avoidance of doubt, if a written notice is so delivered prior to the end of the applicable survival period, the subsequent expiration of the applicable survival period shall not preclude the claimant from thereafter bringing a cause of action in a court of competent jurisdiction for such claim. Notwithstanding the foregoing, claims with respect to Indemnified Taxes and Special Indemnity Matters shall survive until the expiration of the applicable statute of limitations (giving effect to any extensions or tolling).

**Section 7.02&nbsp;&nbsp;&nbsp;&nbsp;Indemnification By The Seller**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Indemnification. Subject to the other terms and conditions of this Article VII, the Seller shall defend, indemnify, and hold harmless the Buyer, its Affiliates, and their respective shareholders, members, directors, managers, officers, and employees (the "<u>Buyer Indemnified Parties</u>") from and against, and pay and reimburse each of them for any Losses incurred or sustained by, or imposed upon, such Buyer Indemnified Party resulting from, relating to or by reason of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;[\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Materiality Scrape. For purposes of this Section 7.02, any inaccuracy in or breach of any representation or warranty, and the calculation of any Losses resulting therefrom, shall be determined without regard to any materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty, and each reference to the terms "material," "materially," "in all material respects," "in any material respect," "Material Adverse Effect" or words of similar import set forth in such representation and warranty shall be disregarded in making such determination; <u>provided</u>, <u>however</u>, that: (i) the words "Material Adverse Effect" shall not be disregarded in Section 3.08 and (ii) the word "Material" shall not be disregarded in the definition and use of the term Material Contracts or similar terms.

**Section 7.03&nbsp;&nbsp;&nbsp;&nbsp;Indemnification By The Buyer.** Subject to the other terms and conditions of this Article VII, the Buyer shall defend, indemnify, and hold harmless the Seller, its Affiliates, and their respective members, managers, directors, officers, and employees (the "<u>Seller Indemnified Parties</u>") from and against, and pay and reimburse each of them for any Losses incurred or sustained by, or imposed upon, such Seller Indemnified Party resulting from, relating to or by reason of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;[\*\*\*]

**Section 7.04&nbsp;&nbsp;&nbsp;&nbsp;Certain Limits**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;<u>General Representations</u>. The Seller shall not be liable to the Buyer Indemnified Parties for indemnification under Section 7.02(a)(i) until the aggregate amount of all Losses in respect of indemnification under Section 7.02(a)(i) exceeds the Indemnity Basket, in which event the Seller shall be required to pay and shall be liable for all such Losses in excess of the Indemnity Basket. The aggregate maximum Liability of the Seller with respect to

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indemnification under Section 7.02(a)(i) shall be an amount equal to the Indemnity Cap. Notwithstanding anything herein to the contrary, the foregoing limitations set forth in this Section 7.04(a) shall not apply to or limit the recovery for Losses based upon, arising out of, with respect to or by reason of: [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;<u>Ultimate Cap</u>. The Seller shall not be liable to the Buyer for Losses under Section 7.02(a) to the extent such Losses in the aggregate are greater than [\*\*\*]; provided, however, that the foregoing limitations shall not apply with respect to any claim for [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;<u>Insurance; No Double Recovery</u>. The Losses otherwise payable to an Indemnified Party pursuant to this Article VII shall be reduced by [\*\*\*]. The Indemnified Party shall use reasonable commercial efforts to seek recovery of Losses under its insurance policies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;<u>Mitigation</u>. The Indemnified Party shall use commercially reasonable efforts to mitigate the Losses it suffers in accordance with applicable Law.

**Section 7.05&nbsp;&nbsp;&nbsp;&nbsp;Indemnification Procedures; Payments**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Any Indemnified Person that seeks indemnity under this Article VII will give written notice (a "<u>Claim Notice</u>") to the Indemnifying Person containing (i) a description, and if known, the estimated amount, of any Losses incurred or reasonably expected to be incurred by the Indemnified Person, (ii) a reasonably detailed explanation of the basis for the Claim Notice to the extent of the facts then known by the Indemnified Person and (iii) a demand for payment of those Losses in accordance with the terms hereof. Within [\*\*\*] after delivery of a Claim Notice, the Indemnifying Person will deliver to the Indemnified Person a written response in which the Indemnifying Person will either: (A) agree that the Indemnified Person is entitled indemnification under this Agreement with respect to the issue in the Claim Notice by delivering to the Indemnified Person a written notice confirming such obligation (an "<u>Acceptance Notice</u>") subject to the assumption that the allegations in the Claim Notice are factually true and accurate; or (B) dispute the Indemnified Person's entitlement to indemnification by delivering to the Indemnified Person a written notice (an "<u>Objection Notice</u>") setting forth in reasonable detail: (x) each disputed item; (y) the basis for each such disputed item; and (z) a certification that all such disputed items are being disputed in good faith and that all other items that are not contained in the Objection Notice are accepted and agreed by the Indemnifying Person. If the Indemnifying Person does not validly deliver an Acceptance Notice or Objection Notice within the applicable [\*\*\*] period, the Indemnifying Person will be deemed to have delivered an Acceptance Notice to the Indemnified Person in accordance with the terms hereof only if such delay in response has materially prejudiced the Indemnified Person by such failure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Any payments by the Indemnifying Person in connection indemnification of an Indemnified Party pursuant to this Article VII will be satisfied directly by the Indemnifying Party, by wire transfer of immediately available funds to an account designated by the Indemnified Person. Any indemnification payments pursuant to this <u>Article VII</u> will be made within five Business Days after the earliest of the date on which both such amount and the

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Indemnifying Person's obligations to pay such amount have been finally determined in accordance with this <u>Article VII.</u> 

**Section 7.06&nbsp;&nbsp;&nbsp;&nbsp;Third-party Claims**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Promptly after receipt by an Indemnified Person of notice of the assertion of a claim against it by a third party (i.e., a Person that is not a party to this Agreement or an Affiliate of a party to this Agreement) for which the Indemnified Person is entitled to indemnity hereunder (a "<u>Third-Party Claim</u>"), the Indemnified Person shall give notice (the "<u>Third-Party Claim Notice</u>") to the Indemnifying Person of the assertion of such Third-Party Claim; provided, however, that the failure to promptly notify the Indemnifying Person will not relieve the Indemnifying Person of any liability that it may have to any Indemnified Person, except to the extent that the Indemnifying Person demonstrates that the defense of such Third-Party Claim is prejudiced by the Indemnified Person's failure to give such notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;If an Indemnified Person gives a Third-Party Claim Notice to the Indemnifying Person, the Indemnifying Person shall be entitled (subject to the further provisions of this clause (b) and Section 7.06(d)) to assume the defense of such Third-Party Claim with counsel reasonably satisfactory to the Indemnifying Person by providing written notice of its intention to do so to the Indemnified Person within ten days of delivery of the Third-Party Claim Notice. If the Indemnifying Person assumes the defense of a Third-Party Claim, such assumption will establish for purposes of this Agreement that the claims made in that Third-Party Claim are within the scope of and subject to indemnification. After written notice from the Indemnifying Person to the Indemnified Person of its election to assume the defense of such Third-Party Claim, the Indemnifying Person shall keep the Indemnified Person informed regarding the progress of such Third-Party Claim (including providing the Indemnified Person with copies of any plans, reports or communications with or submitted to any Governmental Authority or third party). Notwithstanding the foregoing, the Indemnifying Person shall not be entitled to undertake the defense, compromise and settlement of any Third-Party Claim if: [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Indemnified Person shall have the right, at its own cost and expense, to observe in the defense of any Third-Party Claim, with counsel selected by it. If the Indemnifying Person elects not to compromise or defend such Third-Party Claim or fails to notify the Indemnified Person in writing of its election to defend as provided in this Agreement, the Indemnified Person may pay, compromise, or defend such Third-Party Claim and seek indemnification for any and all Losses based upon, arising from or relating to such Third-Party Claim (subject to the limitations on indemnification and the recovery of Losses provided herein). The parties hereto shall (and shall cause their respective Affiliates and Representatives to) cooperate with each other in all reasonable respects in connection with the defense of any Third-Party Claim, including making available records relating to such Third-Party Claim and, without expense (other than reimbursement of actual out-of-pocket expenses) to the defending party, management employees of the non-defending party as may be reasonably necessary for the preparation of the defense of such Third-Party Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;In the event the Indemnifying Person assumes the defense of any Third-Party Claim, the Indemnifying Person shall not enter into a compromise or settlement of any

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Third-Party Claim without the prior written consent of the Indemnified Person (which consent shall not be unreasonably withheld, conditioned or delayed), unless: [\*\*\*].

**Section 7.07&nbsp;&nbsp;&nbsp;&nbsp;Tax Treatment Of Indemnification Payments.** All indemnification payments made under this Agreement shall be treated by the parties as an adjustment to the purchase price for tax purposes, unless otherwise required by Applicable Law.

**Section 7.08&nbsp;&nbsp;&nbsp;&nbsp;Exclusive Remedies.** The parties acknowledge and agree that following the Closing, the provisions of this Article VII shall be their [\*\*\*] for any and all claims relating to the subject matter of this Agreement or any of the other documents to be delivered hereunder. The foregoing provision of this Section 7.08 shall not, however, preclude the Buyer Indemnified Persons from [\*\*\*].

**ARTICLE VIII<br>TERMINATION**

**Section 8.01&nbsp;&nbsp;&nbsp;&nbsp;Termination.** This Agreement may be terminated at any time prior to the Closing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;by the mutual written consent of the Seller and the Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;by either party hereto upon providing written notice to the other party after the Outside Closing Date; provided, however, that the right to terminate this Agreement under this Section 8.01(b) will not be available to any party whose material breach of any of its covenants, obligations or agreements under this Agreement has been the cause of, or materially contributed to, the failure of the Closing to occur on or prior to the Outside Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;by the Buyer by written notice to the Seller in the event of any material breach by the Seller of any of its covenants, obligations, agreements, representations or warranties contained herein and the failure of the Seller to cure, if curable, such breach within [\*\*\*] after receipt of written notice from the Buyer requesting such breach to be cured and, if not cured (if capable of cure), such breach would result in any of the conditions set forth in Section 5.05(a)(v) – (vii) not being satisfied as of the Closing; provided, however, that the right to terminate this Agreement under this Section 8.01(c) will not be available to the Buyer if the Buyer has been the primary cause of, or materially contributed to, the failure of such condition to be satisfied on or prior to such date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;by the Seller by written notice to the Buyer in the event of any material breach by the Buyer of any of its covenants, obligations, agreements, representations or warranties contained herein and the failure of the Buyer to cure, if curable, such breach within [\*\*\*] after receipt of written notice from the Seller requesting such breach to be cured and, if not cured (if capable of cure), such breach would result in any of the conditions set forth in Section 5.05(b)(v) – (vii) not being satisfied as of the Closing; provided, however, that the right to terminate this Agreement under this Section 8.01(d) will not be available to the Seller if the

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Seller has been the primary cause of, or materially contributed to, the failure of such condition to be satisfied on or prior to such date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;by either party in the event that: (i) there shall be any Applicable Law that makes consummation of the transactions contemplated by this Agreement illegal or otherwise prohibited; or (ii) any Governmental Authority shall have issued a Governmental Order restraining or enjoining the transactions contemplated by this Agreement, and such Governmental Order shall have become final and non-appealable (except that a party cannot exercise a termination right hereunder to the extent the Governmental Order arises from the any breach or non-performance by a party of its obligations under this Agreement).

**Section 8.02&nbsp;&nbsp;&nbsp;&nbsp;Effect Of Termination.** In the event of the termination of this Agreement in accordance with this Article VIII, all rights and obligations of the parties hereunder shall terminate without any liability of any party to any other party (except for any liability of any party then in breach of this Agreement); provided, however, that Section 7.03(c), Section 8.02 and Article IX shall survive any such termination and remain in full force and effect.

**ARTICLE IX<br>MISCELLANEOUS**

**Section 9.01&nbsp;&nbsp;&nbsp;&nbsp;Expenses.** Except as otherwise expressly provided elsewhere in this Agreement, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

**Section 9.02&nbsp;&nbsp;&nbsp;&nbsp;Further Assurances.** Following the Closing, each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably requested by the other party to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement. If Seller is unable to transfer any Excluded Asset out of the Company prior to Closing, then, from and after the Closing, (i) Buyer shall reasonably cooperate, at Seller's expense, to transfer such Excluded Asset to Seller, and (ii) if the Buyer or the Company receives or collects any funds relating to any Excluded Assets, the Buyer, the Company or its Affiliates shall remit such funds to Seller within [\*\*\*] after its receipt thereof.

**Section 9.03&nbsp;&nbsp;&nbsp;&nbsp;Disclaimer.** THE AIRCRAFT, ENGINES AND ROTABLES ARE IN AN "AS-IS, WHERE-IS" AND "WITH ALL FAULTS" CONDITION, AND, EXCEPT FOR THE SELLER'S WARRANTY OF TITLE TO THE AIRCRAFT, ENGINES AND ROTABLES CONTAINED IN THIS AGREEMENT AND THE REPRESENTATIONS AND WARRANTIES OF THE SELLER CONTAINED IN THIS AGREEMENT, THE SELLER DOES NOT MAKE, GIVE OR EXTEND, AND THE BUYER HEREBY DISCLAIMS AND RENOUNCES, ANY AND ALL WARRANTIES OR REPRESENTATIONS OF ANY KIND OR NATURE WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ARISING IN LAW, IN EQUITY, IN CONTRACT OR IN TORT, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY, AIRWORTHINESS, DESIGN, CONDITION OR FITNESS FOR A PARTICULAR PURPOSE. THE BUYER ACKNOWLEDGES AND CONFIRMS THAT BY

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ACCEPTING DELIVERY OF THE AIRCRAFT, ENGINES AND ROTABLES THE BUYER ASSUMES ALL RISK ASSOCIATED WITH THE USE, OPERATION AND MAINTENANCE OF THE AIRCRAFT, ENGINES AND ROTABLES FROM AND AFTER CLOSING. THE BUYER HAS HAD AN OPPORTUNITY TO INSPECT THE AIRCRAFT, ENGINES AND ROTABLES AND IS ACCEPTING THEM "AS-IS," "WHERE-IS" AND "WITH ALL FAULTS."

**Section 9.04&nbsp;&nbsp;&nbsp;&nbsp;Notices.** All notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 9.04):

If to the Seller:

AWAC Aviation, Inc.

[\*\*\*]

[\*\*\*]

Attn: [\*\*\*]

Email: [\*\*\*]

with a copy to:&nbsp;&nbsp;&nbsp;&nbsp;

&nbsp;&nbsp;&nbsp;&nbsp;Vedder Price P.C.

222 North LaSalle Street<br>Chicago, Illinois 60601

Attn: [\*\*\*]<br>Email: [\*\*\*]

If to the Buyer:

CSI Aviation, Inc.

6006 Reese Creek Rd

Killeen, Texas 76549

Attention: [\*\*\*]

Telephone: 505-761-9000

Email: [\*\*\*]

With copies (which shall not constitute notice) to:

Taft Stettinius & Hollister LLP

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111 E, Wacker Drive, Suite #2600

Chicago, Illinois 60601

Attn: [\*\*\*]

Email: [\*\*\*]

**Section 9.05&nbsp;&nbsp;&nbsp;&nbsp;Headings.** The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

**Section 9.06&nbsp;&nbsp;&nbsp;&nbsp;Severability.** If any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify the Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

**Section 9.07&nbsp;&nbsp;&nbsp;&nbsp;Entire Agreement.** This Agreement, the Seller Disclosure Schedules and the documents to be delivered hereunder (including the Related Agreements) constitute the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein, and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement and those in documents to be delivered hereunder, including the exhibits, the statements in the body of this Agreement will control.

**Section 9.08&nbsp;&nbsp;&nbsp;&nbsp;Successors And Assigns.** This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. The Seller may not assign its rights or obligations hereunder without the prior written consent of the Buyer. This Agreement shall be assignable by the Buyer without the consent of the Seller to any of the Buyer's or the Company's lenders as collateral security for any obligations to such lenders. No assignment shall relieve the assigning party of any of its obligations hereunder.

**Section 9.09&nbsp;&nbsp;&nbsp;&nbsp;No Third-party Beneficiaries.** Except as provided in Article VII, this Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

**Section 9.10&nbsp;&nbsp;&nbsp;&nbsp;Amendment And Modification.** This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto.

**Section 9.11&nbsp;&nbsp;&nbsp;&nbsp;Non-waiver.** No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach, or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any

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right, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.

**Section 9.12&nbsp;&nbsp;&nbsp;&nbsp;Non-assertion Of Attorney-client Privilege**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer waives and shall not assert, and agrees to cause the Company to waive and to not assert, any conflict of interest arising out of or relating to the representation after the Closing (the "<u>Post-Closing Representation</u>") of the Seller or any personnel of the Company (any such Person, a "<u>Designated Person</u>") in any matter involving this Agreement or the transactions contemplated hereby by any legal counsel currently representing the Seller, the Company or any Designated Person ("<u>Seller Counsel</u>") in connection with this Agreement or the transactions contemplated hereby (the "<u>Current Representation</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer waives and shall not assert, and agrees to cause the Company to waive and to not assert, any attorney-client privilege with respect to any communication between VP and any Designated Person occurring during the Current Representation in connection with any Post-Closing Representation, including in connection with a dispute with the Buyer and, following the Closing, with the Company, it being the intention of the parties hereto that all rights to such attorney-client privilege and to control such attorney-client privilege shall be retained by the Designated Person; provided that the foregoing waiver and acknowledgment of retention shall not extend to any communication not involving this Agreement or the transactions contemplated hereby or to communications with any Person other than the Designated Persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer acknowledges and agrees that Seller Counsel has obtained privileged and confidential information about the Company (the "<u>Company Confidential Information</u>") in connection with its representation of the Company in the transactions contemplated hereby. The Company Confidential Information includes all privileged communications, whether written or electronic, including any privileged communications between Seller Counsel, on the one hand, and the Company, on the other hand, and their Representatives, personnel and Affiliates, and all files, attorney notes, drafts or other documents primarily relating to this Agreement and the transactions contemplated hereby which predate the Closing (collectively, the "<u>Seller Counsel Work Product</u>"). In the event of a dispute, to the extent that any Company Confidential Information is in Seller Counsel's possession as of the Closing Date, the Company Confidential Information may be used on behalf of the Seller in connection with such dispute at the sole discretion of the Seller. The Buyer waives the right to access any privileged Seller Counsel Work Product, except as reasonably necessary in connection with an action which does not constitute a dispute. The Buyer hereby consents to the disclosure and use by Seller Counsel for the benefit of the Seller of any information (confidential or otherwise) disclosed to it by the Company (including by its Representatives, personnel and Affiliates) prior to the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;The Buyer hereby acknowledges that it has had the opportunity to discuss and obtain adequate information concerning the significance and material risks of, and

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

reasonable available alternatives to, the waivers, permissions and other provisions of this Section 9.12, including the opportunity to consult with counsel.

**Section 9.13&nbsp;&nbsp;&nbsp;&nbsp;Governing Law.** This Agreement shall be governed by and construed in accordance with the internal laws of the [\*\*\*] without giving effect to any choice or conflict of law provision or rule (whether of the [\*\*\*] or any other jurisdiction).

**Section 9.14&nbsp;&nbsp;&nbsp;&nbsp;Submission To Jurisdiction; Attorneys' Fees.** Any legal suit, action or proceeding arising out of or based upon this Agreement shall be instituted in any federal court of the United States of America sitting in [\*\*\*], and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, Action or proceeding. Service of process, summons, notice or other document by mail to such party's address set forth herein shall be effective service of process for any suit, Action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, Action or any proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, Action or proceeding brought in any such court has been brought in an inconvenient forum. In the event of any litigation arising out of or based upon this Agreement or the transactions contemplated hereby, the prevailing party in such litigation shall be entitled to recover its reasonable attorneys' fees and litigation expenses from the non-prevailing party.

**Section 9.15&nbsp;&nbsp;&nbsp;&nbsp;Waiver Of Jury Trial.** Each party acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues and, therefore, each such party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement or the transactions contemplated hereby.

**Section 9.16&nbsp;&nbsp;&nbsp;&nbsp;Specific Performance.** The parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law or in equity. Each party hereto (a) agrees that it shall not oppose the granting of such specific performance or relief and (b) hereby irrevocably waives any requirements for the security or posting of any bond in connection with such relief.

**Section 9.17&nbsp;&nbsp;&nbsp;&nbsp;Counterparts**. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail, or other means of electronic transmission, including DocuSign, shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

**Section 9.18&nbsp;&nbsp;&nbsp;&nbsp;Interpretation.** For purposes of this Agreement, unless otherwise expressly provided: (a) the words "include," "includes" and "including" shall be deemed to be followed by the words "without limitation;" (b) the word "or" is not exclusive; (c) the words "herein," "hereof," "hereby," "hereto" and "hereunder" refer to this Agreement as a whole; and (d) references herein: (i) to Articles, Sections, Schedules and Exhibits mean the Articles and Sections of, and Schedules and Exhibits attached to, this Agreement; (ii) to an agreement, instrument or other document means such agreement, instrument or other document as amended,

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

supplemented and modified from time to time to the extent permitted by the provisions thereof; (iii) all monetary figures shall be in United States dollars unless otherwise specified; and (iv) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Schedules, including Seller Disclosure Schedules and Exhibits referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.

**Section 9.19&nbsp;&nbsp;&nbsp;&nbsp;Guarantee**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;The Guarantor hereby irrevocably and unconditionally guarantees to the Buyer, as primary obligor and not merely as a surety, the full and timely payment of [\*\*\*] (the "<u>Guaranteed Obligations</u>"). This is a guarantee of payment and performance, and not merely of collection, and the Guarantor acknowledges and agrees that this guarantee is full and unconditional, and no amendment, modification, release or extinguishment of the Buyer's or the Seller's obligations or liabilities or the Guaranteed Obligations, whether by decree in any bankruptcy proceeding or otherwise, shall affect the continuing validity and enforceability of this guarantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Guarantor hereby waives diligence, presentment, demand of performance, filing of any claim, any right to require any proceeding first against the Seller, protest, notice and all defenses and demands whatsoever in connection with the performance of its obligations set forth in this Section 9.19.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Guarantor understands that the Buyer is relying on this guarantee in entering into this Agreement. The Guarantor hereby represents and warrants that: (i) it has the full power, legal right and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby; (ii) the execution, delivery, and performance by the Guarantor of this Agreement, and the consummation by the Guarantor of the transactions contemplated hereby, have been duly and validly authorized by all necessary corporate action on the part of the Guarantor and no other or further action or proceeding on the part of the Guarantor is necessary to authorize the execution, delivery and performance by the Guarantor of this Agreement or the consummation by the Guarantor of the transactions contemplated hereby; (iii) this Agreement has been duly executed and delivered by the Guarantor, and this Agreement (assuming that this Agreement constitutes the legal, valid, and binding obligations of the other parties hereto) constitutes the valid and binding obligations of the Guarantor, enforceable in accordance with its terms except as such enforceability may be limited by the Enforceability Exceptions; and (iv) the Guarantor has, and will have at the Closing and thereafter, sufficient cash or other sources of immediately available funds to enable it to pay the Guaranteed Obligations. The Guarantor shall indemnify and hold harmless the Buyer from and against any and all Losses incurred or sustained by the Buyer arising out of or resulting from any breach of any representation or warranty of the Guarantor set forth in this Section 9.19(c).

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

[SIGNATURE PAGES FOLLOW]

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**IN WITNESS WHEREOF**, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

---

| |
|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;**SELLER:**<br>**AWAC AVIATION, INC.<br>**<br> By:*<u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Robert Binns</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name: Robert Binns<br>&nbsp;&nbsp;&nbsp;&nbsp;Title: Executive Vice President<br>**GUARANTOR (SOLELY FOR PURPOSES OF SECTION 9.19):** |
| &nbsp;&nbsp;&nbsp;&nbsp;**HARBOR DIVERSIFIED INC.<br>**<br> By:<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>*<u>/s/ Christine R. Deister</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name: Christine R. Deister<br>&nbsp;&nbsp;&nbsp;&nbsp;Title: Chief Executive Officer and Secretary |

---

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**IN WITNESS WHEREOF**, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**&nbsp;&nbsp;&nbsp;&nbsp;BUYER:**

&nbsp;&nbsp;&nbsp;&nbsp;**CSI AVIATION, INC. <br>**<br> By:<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>*<u>/s/ Allen Weh</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name: Allen Weh<br>&nbsp;&nbsp;&nbsp;&nbsp;Title: Member<br>

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**<u>Schedule 1.01(a)</u>**

[\*\*\*]

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**<u>Schedule 1.01(b)(i)</u>**

**Certain Indebtedness**

**[\*\*\*]**

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**<u>Schedule 1.01(b)(ii)</u>**

**Assumed Indebtedness**

[\*\*\*]

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**<u>Schedule 1.01(c)</u>**

**Special Indemnity Matters**

[\*\*\*]

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

**<u>Schedule 5.03</u>**

**Excluded Assets** 

[\*\*\*]

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

## Exhibit 10.10

**Certain confidential information contained in this document, marked by [\*\*\*], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**SALE AND PURCHASE AGREEMENT<br>**

<br> dated as of December 10, 2025

between

HARBOR DIVERSIFIED, INC.<br>as Seller

and

CSI AVIATION, INC.<br>as Buyer

____________________________________________<br>Used Airframes, Engines and Expendables<br>____________________________________________<br>

------

**TABLE OF CONTENTS**

**Page**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;&nbsp;&nbsp;Definitions.&nbsp;&nbsp;&nbsp;&nbsp;[1](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2&nbsp;&nbsp;&nbsp;&nbsp;Interpretation.&nbsp;&nbsp;&nbsp;&nbsp;[5](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

2.&nbsp;&nbsp;&nbsp;&nbsp;Agreements to Sell and Purchase; Assignment of Warranties; Etc.&nbsp;&nbsp;&nbsp;&nbsp;[6](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;&nbsp;Sale and Purchase of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[6](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2&nbsp;&nbsp;&nbsp;&nbsp;Assignment of Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3&nbsp;&nbsp;&nbsp;&nbsp;Buyer Nominee.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

3.&nbsp;&nbsp;&nbsp;&nbsp;Purchase Price; Transaction Fee; Payment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1&nbsp;&nbsp;&nbsp;&nbsp;Purchase Price&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2&nbsp;&nbsp;&nbsp;&nbsp;Delivery Date Payment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3&nbsp;&nbsp;&nbsp;&nbsp;Payment Instructions.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

4.&nbsp;&nbsp;&nbsp;&nbsp;Aircraft Acceptance.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

5.&nbsp;&nbsp;&nbsp;&nbsp;Delivery of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1&nbsp;&nbsp;&nbsp;&nbsp;Delivery Condition&nbsp;&nbsp;&nbsp;&nbsp;[7](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;Delivery Location.&nbsp;&nbsp;&nbsp;&nbsp;[8](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3&nbsp;&nbsp;&nbsp;&nbsp;Delivery Schedule.&nbsp;&nbsp;&nbsp;&nbsp;[8](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4&nbsp;&nbsp;&nbsp;&nbsp;Delivery&nbsp;&nbsp;&nbsp;&nbsp;[8](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5&nbsp;&nbsp;&nbsp;&nbsp;FAA Documents&nbsp;&nbsp;&nbsp;&nbsp;[9](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

6.&nbsp;&nbsp;&nbsp;&nbsp;Conditions Precedent.&nbsp;&nbsp;&nbsp;&nbsp;[9](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;Conditions Precedent.&nbsp;&nbsp;&nbsp;&nbsp;[9](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2&nbsp;&nbsp;&nbsp;&nbsp;No Financing or Other Contingencies.&nbsp;&nbsp;&nbsp;&nbsp;[12](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

7.&nbsp;&nbsp;&nbsp;&nbsp;Termination.&nbsp;&nbsp;&nbsp;&nbsp;[12](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1&nbsp;&nbsp;&nbsp;&nbsp;Total Loss before Delivery; Material Damage before Delivery.&nbsp;&nbsp;&nbsp;&nbsp;[12](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2&nbsp;&nbsp;&nbsp;&nbsp;Default Provisions.&nbsp;&nbsp;&nbsp;&nbsp;[13](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3&nbsp;&nbsp;&nbsp;&nbsp;Effect of Termination.&nbsp;&nbsp;&nbsp;&nbsp;[13](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

8.&nbsp;&nbsp;&nbsp;&nbsp;Representations and Warranties; Disclaimers and Waivers.&nbsp;&nbsp;&nbsp;&nbsp;[13](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1&nbsp;&nbsp;&nbsp;&nbsp;Seller Representations and Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[13](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2&nbsp;&nbsp;&nbsp;&nbsp;Buyer Representations and Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[14](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3&nbsp;&nbsp;&nbsp;&nbsp;Disclaimers.&nbsp;&nbsp;&nbsp;&nbsp;[15](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4&nbsp;&nbsp;&nbsp;&nbsp;LIMITATION OF LIABILITY; WAIVER.&nbsp;&nbsp;&nbsp;&nbsp;[17](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

9.&nbsp;&nbsp;&nbsp;&nbsp;Insurance.&nbsp;&nbsp;&nbsp;&nbsp;[17](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1&nbsp;&nbsp;&nbsp;&nbsp;Insurances.&nbsp;&nbsp;&nbsp;&nbsp;[17](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2&nbsp;&nbsp;&nbsp;&nbsp;Certificates, Etc.&nbsp;&nbsp;&nbsp;&nbsp;[18](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

i

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------

10.&nbsp;&nbsp;&nbsp;&nbsp;Transfer Taxes; Indemnities.&nbsp;&nbsp;&nbsp;&nbsp;[18](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1&nbsp;&nbsp;&nbsp;&nbsp;Transfer Taxes.&nbsp;&nbsp;&nbsp;&nbsp;[18](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;Seller Indemnities..&nbsp;&nbsp;&nbsp;&nbsp;[19](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3&nbsp;&nbsp;&nbsp;&nbsp;Buyer Indemnities..&nbsp;&nbsp;&nbsp;&nbsp;[19](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

11.&nbsp;&nbsp;&nbsp;&nbsp;Miscellaneous.&nbsp;&nbsp;&nbsp;&nbsp;[20](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1&nbsp;&nbsp;&nbsp;&nbsp;Entire Agreement, Amendment, and Installment Contract.&nbsp;&nbsp;&nbsp;&nbsp;[20](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2&nbsp;&nbsp;&nbsp;&nbsp;Time of the Essence to Complete Purchase of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[20](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3&nbsp;&nbsp;&nbsp;&nbsp;Non-Waiver.&nbsp;&nbsp;&nbsp;&nbsp;[20](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4&nbsp;&nbsp;&nbsp;&nbsp;Severability.&nbsp;&nbsp;&nbsp;&nbsp;[21](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.5&nbsp;&nbsp;&nbsp;&nbsp;Notices.&nbsp;&nbsp;&nbsp;&nbsp;[21](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.6&nbsp;&nbsp;&nbsp;&nbsp;Governing Law and Jurisdiction.&nbsp;&nbsp;&nbsp;&nbsp;[21](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.7&nbsp;&nbsp;&nbsp;&nbsp;Waiver of Jury Trial.&nbsp;&nbsp;&nbsp;&nbsp;[22](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.8&nbsp;&nbsp;&nbsp;&nbsp;Further Assurances.&nbsp;&nbsp;&nbsp;&nbsp;[22](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.9&nbsp;&nbsp;&nbsp;&nbsp;Counterparts.&nbsp;&nbsp;&nbsp;&nbsp;[22](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.10&nbsp;&nbsp;&nbsp;&nbsp;Transaction Costs.&nbsp;&nbsp;&nbsp;&nbsp;[22](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.11&nbsp;&nbsp;&nbsp;&nbsp;Assignment, Successors and Assigns.&nbsp;&nbsp;&nbsp;&nbsp;[23](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.12&nbsp;&nbsp;&nbsp;&nbsp;Confidentiality.&nbsp;&nbsp;&nbsp;&nbsp;[23](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.13&nbsp;&nbsp;&nbsp;&nbsp;Third-party Beneficiaries.&nbsp;&nbsp;&nbsp;&nbsp;[23](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.14&nbsp;&nbsp;&nbsp;&nbsp;[Intentionally Omitted].&nbsp;&nbsp;&nbsp;&nbsp;[24](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.15&nbsp;&nbsp;&nbsp;&nbsp;Force Majeure.&nbsp;&nbsp;&nbsp;&nbsp;[24](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.16&nbsp;&nbsp;&nbsp;&nbsp;Publicity.&nbsp;&nbsp;&nbsp;&nbsp;[24](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17&nbsp;&nbsp;&nbsp;&nbsp;Relationship of the Parties.&nbsp;&nbsp;&nbsp;&nbsp;[24](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18&nbsp;&nbsp;&nbsp;&nbsp;Brokers and other Third Parties.&nbsp;&nbsp;&nbsp;&nbsp;[25](#i7dbc44cb351f438e951c2d0a8f8b1dd8_7)

<u>EXHIBITS</u>

Exhibit A &nbsp;&nbsp;&nbsp;&nbsp;Description of Aircraft, Engines and Expendables

Exhibit B**&nbsp;&nbsp;&nbsp;&nbsp;**Form of Acceptance Certificate

Exhibit C&nbsp;&nbsp;&nbsp;&nbsp;Form of Warranty Bill of Sale&nbsp;&nbsp;&nbsp;&nbsp;

ii

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------

**SALE AND PURCHASE AGREEMENT**

This SALE AND PURCHASE AGREEMENT (this "**<u>Agreement</u>**") is entered into as of December 10, 2025 by and between HARBOR DIVERSIFIED, INC., a Delaware corporation (hereinafter referred to as "**<u>Seller</u>**"), and CSI AVIATION, INC., a Texas corporation (hereinafter referred to as "**<u>Buyer</u>**") (Seller and Buyer are each a "**<u>Party</u>**" and, collectively, the "**<u>Parties</u>**").

RECITALS

WHEREAS, Seller (or a Seller-Owner) owns the Items of Equipment described more fully on Exhibit A hereto, together with all documents and available records pertaining thereto in Seller's (or a Seller-Owner's) possession ("**<u>Records</u>**");

WHEREAS, Seller desires to sell and Buyer desires to purchase, such Items of Equipment owned by Seller (or a Seller-Owner);

WHEREAS, the Parties now desire to enter into this Agreement.

NOW, THEREFOR, in consideration of the mutual promises and covenants herein contained, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

1.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Definitions & Interpretation</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;&nbsp;&nbsp;**Definitions**. The following capitalized terms used herein and not otherwise defined shall have the following respective meanings for all purposes of this Agreement.

"**<u>Acceptance Certificate</u>**" means an acceptance certificate substantially in the form of Exhibit B hereto.

"**<u>Affiliate</u>**" means a Person or an entity that directly or indirectly controls, is controlled by, or is under common control with, another Person or entity, including, among others, executive officers, directors, large stockholders, subsidiaries, parent entities and sister companies.

"**<u>Agreement</u>**" has the meaning given to it in the preamble.

"**<u>Aircraft</u>**" means, individually or collectively, as indicated by the context, an Airframe plus [\*\*\*] Engines associated therewith which may not be installed thereon (each as described on Exhibit A hereto), and all Parts of any thereof, together with the Records relating thereto.

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"**<u>Airframe</u>**" means, individually or collectively, as indicated by context, those certain Bombardier model CL-600 series airframes (excluding the associated Engines), as described in Exhibit A hereto, together with any and all Parts installed thereon, or listed in the Acceptance Certificate, and with all Records relating thereto.

"**<u>Bill of Sale</u>**" means a warranty bill of sale substantially in the form of Exhibit C hereto.

"**<u>Business Day</u>**" means a day other than a Saturday or Sunday on which the banks in Appleton, Wisconsin and New York City, New York, USA are open for the transaction of business of the type required by this Agreement.

"**<u>Buyer</u>**" has the meaning given to it in the preamble.

"**<u>Buyer's Default</u>**" means (i) any failure by Buyer to observe or perform any of its material obligations or (ii) a material breach of a representation contained in Section 8.2, in each case, under this Agreement if such failure continues for [\*\*\*] after written notice thereof is delivered to Buyer from Seller (provided that if the same is not capable of being cured within such [\*\*\*], subject to Buyer having commenced good faith efforts to cure the same, the material breach has thereafter not been cured within [\*\*\*] following receipt of Seller's written notice).

"**<u>Buyer's Liens</u>**" has the meaning given to it in Section 2.1(c).

"**<u>Cape Town Agreements</u>**" means the Cape Town Convention, as supplemented by the Cape Town Item of Equipment Protocol (in each case, the English language version).

"**<u>Cape Town Item of Equipment Protocol</u>**" means The Protocol on International Interests in Mobile Equipment, concluded in Cape Town, South Africa, on November 16, 2001 (the English language version).

"**<u>Cape Town Convention</u>**" means The Convention on International Interests in Mobile Equipment, concluded in Cape Town, South Africa, on November 16, 2001 (the English language version).

"**<u>Civil Aviation Registry</u>**" means the registry of aircraft maintained by the FAA.

"**<u>Confidential Information</u>**" has the meaning given to such term in Section 11.12.

"**<u>Delivery</u>**" means, with respect to any Item of Equipment, delivery of such Item of Equipment pursuant to the terms of this Agreement.

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"**<u>Delivery Condition</u>**" means, with respect to any Item of Equipment, the condition of such Item of Equipment at Delivery as provided in Section 5.1.

"**<u>Delivery Date</u>**" means, with respect to any Item of Equipment, the actual date on which Delivery occurs.

"**<u>Delivery Location</u>**" has the meaning given to such term in Section 5.2.

"**<u>Delivery Window Deadline</u>**" has the meaning given to such term in Section 5.3(b).

"**<u>Dollars</u>**", "**<u>$</u>**" and "**<u>US$</u>**" mean the lawful currency of the United States.

"**<u>Engine</u>**" means each [\*\*\*] engine described in Exhibit A hereto, together with any and all Parts incorporated or installed on or attached thereto, or listed in the Acceptance Certificate, and with the Records relating thereto.

"**<u>Excluded Asset</u>**" means an Item of Equipment that is no longer subject to this Agreement.

"**<u>Expendables</u>"** means the inventory of expendable parts owned by Seller (or Seller-Owner).

**"<u>FAA</u>**" means the United States Federal Aviation Administration.

"**<u>FAA Bill of Sale</u>**" means, with respect to an Aircraft, an FAA Form AC 8050-2 bill of sale (or any successor form thereto established and accepted by the FAA).

"**<u>FAA Counsel</u>**" means the law firm of Crowe and Dunlevy, a Professional Corporation, or such other law firm as agreed between the Parties.

"**<u>FAA Registration Application</u>**" means, with respect to an Airframe, an FAA Form AC 8050-1 airframe registration application document (or any successor form thereto established and accepted by the FAA) required to register airframe for operation within the United States.

"**<u>GMM</u>**" means the General Maintenance Manual for the applicable Item of Equipment.

"**<u>Government Entity</u>**" means the United States government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory, or administrative functions of or pertaining to any such government.

"**<u>Insurance Period</u>**" has the meaning given to it in Section 9.1.

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"**<u>International Interests</u>**" has the meaning ascribed to the term "international interests" under the Cape Town Agreements.

"**<u>International Registry</u>**" has the meaning ascribed to the term "international registry" under the Cape Town Agreements.

"**<u>Item of Equipment</u>**" or "**<u>Item</u>**" mean individually or collectively, as the context requires, an Aircraft, an Airframe, any Engine or any Expendable.

"**<u>Law</u>**" means any (a) Law, statute, decree, constitution, regulation, order or directive of any Government Entity, (b) treaty, pact, compact or other agreement to which any Government Entity is a signatory or party, (c) judicial or administrative interpretation or application of any of the foregoing or (d) any binding judicial precedent having the force of Law in any Government Entity.

"**<u>Lien</u>**" means any lien, security interest, lease, sublease, wet-lease, charter, mortgage, pledge, assignment, International Interest on the International Registry (but not any contract of sale registration on the International Registry), title retention or other charge or encumbrance or claim or right of others or agreement the effect of which is the creation of security, including, without limitation, rights of others.

"**<u>Non-Sale Event</u>**" means the obligation of the Seller and the Purchaser under this Agreement with respect to an Item of Equipment shall terminate and the Parties shall have no further obligation as to such Item of Equipment, except as set forth in Section 7.1(c).

"**<u>Parts</u>**" mean all appliances, avionics, components, parts, instruments, appurtenances, accessories, furnishings, seats, galleys, galley equipment, serving equipment, lavatories, cargo handling equipment, safety equipment and other equipment of whatever nature (other than complete Engines or engines) incorporated or installed or positioned in or on or attached to any Airframe or any Engine.

"**<u>Party</u>**" has the meaning given to it in the preamble.

"**<u>Person</u>**" means any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, company, firm, trust, organization, government, or any agency or political subdivision thereof or any other entity, whether or not having a separate legal personality.

"**<u>Purchase Price</u>**" with respect to each Item of Equipment has the meaning given to it in Section 3.1.

"**<u>Records</u>**" has the meaning given to it in the recitals.

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"**<u>Representatives</u>**" has the meaning given to it in Section 11.12.

"**<u>Scheduled Delivery Date</u>**" means the date that is [\*\*\*] following the date of this Agreement.

"**<u>Seller</u>**" has the meaning given to it in the preamble.

"**<u>Seller's Default</u>**" means (i) any failure by Seller or a Seller-Owner to observe or perform any of its material obligations or (ii) a material breach of a representation contained in Section 8.1, in each case, under this Agreement if such failure continues for [\*\*\*] after written notice thereof is delivered to Seller from Buyer (provided that if the same is not capable of being cured within such [\*\*\*], subject to Seller having commenced good faith efforts to cure the same, the material breach has thereafter not been cured within [\*\*\*] following receipt of Buyer's written notice).

"**<u>Seller-Owner</u>**" means either Air Wisconsin Airlines LLC or Lotus Aviation Leasing, LLC, as the case may be.

"**<u>Seller Parties</u>**" means Seller, its subsidiaries and parent organizations, and each of its and their directors, officers, shareholders, members, controlling Persons, agents, employees, subsidiaries, Affiliates, servants, successors, assigns and transferees of the foregoing parties (each, a "**<u>Seller Party</u>**").

"**<u>Share Purchase Agreement</u>**" means the share purchase agreement dated the date hereof between Harbor Diversified, Inc. and CSI Aviation, Inc.

"**<u>Total Loss</u>**" means, as applicable, the actual, constructive or arranged total loss of an Item of Equipment.

"**<u>Transaction Documents</u>**" means this Agreement, any Bills of Sale, any Acceptance Certificates, the FAA Bills of Sale, and any other document, instrument, or certificate issued pursuant to, or amending or modifying any of the foregoing that is entered into by one or more Parties.

"**<u>Transfer Taxes</u>**" has the meaning given to it in Section 10.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2&nbsp;&nbsp;&nbsp;&nbsp;**Interpretation**. All references in this Agreement to Exhibits, Sections, paragraphs, subsections, clauses and other subdivisions refer to the corresponding Exhibits, Sections, paragraphs, subsections, clauses and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Sections, paragraphs, subsections, or other subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words "this Agreement," "herein," "hereby,"

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"hereunder," and "hereof," and words of similar nature, refer to this Agreement as a whole and not to any particular Section, subsection, or other subdivision unless expressly so limited. The words "this Section," and "this subsection," and words of similar nature, refer only to the Section, or subsection hereof in which such words occur. The word "including" (in its various forms) means "including without limitation". Pronouns in masculine, feminine, or neutral genders shall be construed to state and include any other gender, and words, terms, and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. Exhibits and Appendices referred to herein are attached hereto. Except as otherwise provided in this Agreement, any reference herein to any Law shall be construed as referring to such Law as amended, modified, codified, or reenacted, in whole or in part, and in effect from time to time, and references to particular provisions of a Law include a reference to the corresponding provisions of any prior or succeeding Law, and any reference herein to a document includes that document as amended from time to time in accordance with its terms, and any document entered into in substitution or replacement therefor. Any reference to an amendment includes a supplement, novation, or re-enactment, and "amended" is to be construed accordingly. The word "extent" in the phrase "to the extent" means the degree to which a subject or other theory extends, and such phrase shall not simply mean "if". Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. Whenever any action must be taken hereunder on or by a day that is not a Business Day, then such action may be validly taken on or by the next day that is a Business Day. Any reference to any federal, state, local, or foreign Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context shall otherwise require. Reference herein to "federal" shall be construed as referring to U.S. federal.

2.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Agreements to Sell and Purchase; Assignment of Warranties; Etc</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;&nbsp;**Sale and Purchase of Item of Equipment**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Subject to the terms and conditions of this Agreement and the applicable Transaction Documents, Seller agrees to sell (or to cause a Seller-Owner to sell) and Buyer agrees to accept and purchase each Item of Equipment identified in Exhibit A hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The consideration payable with respect to each Item of Equipment will be the Purchase Price for such Item of Equipment as set forth on Exhibit A hereto, and, with respect to each Aircraft, the aggregate Purchase Price of the applicable Airframe and [\*\*\*] Engines.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Upon payment of the Purchase Price in respect of an Item of Equipment in accordance with the applicable provisions of this Agreement, Seller

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;With respect to each Item of Equipment, concurrently with Seller's delivery to Buyer of an executed Bill of Sale for such Item of Equipment, Buyer shall accept delivery of such Item of Equipment, and Buyer shall execute and deliver an Acceptance Certificate in respect of such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2&nbsp;&nbsp;&nbsp;&nbsp;**Assignment of Warranties**. Seller hereby assigns to the Buyer, effective as of the Delivery Date for the applicable Item of Equipment, any and all existing assignable warranties, covenants or assignments of rights of warranties, and service life policies, or other rights, remedies or claims against manufacturers, suppliers, vendors and maintenance and overhaul agencies, or any other person or entity relating to an Item of Equipment. Seller makes no representation or warranty as to the existence or assignability of any such warranties and rights. After the Delivery Date, Seller will, at its own cost and expense, cooperate with reasonable written requests from Buyer, including entering into such documents as may be customary, to deliver to Buyer the benefits intended by this Section 2.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Nominee**. Buyer shall have the right by written notice to Seller, to nominate a subsidiary or owner trust of which the beneficiary is Buyer or a subsidiary of Buyer ("**Buyer Nominee**"), to take title to any Item of Equipment in lieu of Buyer. The nomination of a Buyer Nominee shall not relieve Buyer of its obligations under this Agreement; provided that performance by Buyer Nominee of the obligations of Buyer shall discharge such obligation pro tanto.

3.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Purchase Price; Transaction Fee; Payment</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1&nbsp;&nbsp;&nbsp;&nbsp;**Purchase Price**. For each Aircraft, the total consideration payable by Buyer to Seller at Delivery shall be equal to the amount set forth in Exhibit A for such Aircraft (for each Item of Equipment, its "**<u>Purchase Price</u>**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Date Payment**. At Delivery Date (unless extended pursuant to Section 5.3(b)) Buyer shall pay Seller the Purchase Price for all Items of Equipment delivered, free and clear of and without any deduction or withholding for or on account of tax.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3&nbsp;&nbsp;&nbsp;&nbsp;**Payment Instructions**.

&nbsp;&nbsp;&nbsp;&nbsp;Seller directs Buyer to pay the Purchase Price for the applicable Item of Equipment due under this Agreement in Dollars by wire transfer of immediately available funds to the

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account designated by Seller to Buyer in writing at least [\*\*\*] prior to the date such payment is due.

4.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Aircraft Acceptance</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have access to each Item of Equipment, and all Records, prior to its purchase, at its own cost to verify that each Item of Equipment is in the Delivery Condition immediately prior to Delivery.

5.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Delivery of Item of Equipment</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Condition**. Except as expressly described in this Section 5.1, each Item of Equipment will be delivered in "AS-IS, WHERE-IS" and "WITH ALL FAULTS" condition subject to the following specific conditions being met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Each Item of Equipment shall be in serviceable condition per the GMM and in the same condition, configuration and modification as of the date of this Agreement, ordinary operational wear and tear excepted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;All Records with respect to the applicable Item of Equipment shall be in the English language and shall be in good condition, readable, complete, accurate as to content, and up to date in accordance with FAA requirements and in the same condition as of the date of this Agreement but for such additions as are required to satisfy FAA requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;In the case of an Airframe, such Airframe shall be clean by scheduled passenger airline standards.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;The Aircraft shall have a currently valid US Certificate of Airworthiness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;Each Item of Equipment shall be free and clear of all Liens (other than Buyer's Liens).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Location**. The delivery location (the "**<u>Delivery Location</u>**") for each Item of Equipment shall be at a location designated by Buyer and reasonably acceptable to Seller [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Schedule**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Intentionally Omitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The "**<u>Delivery Window Deadline</u>**" shall mean the date that is [\*\*\*] after the Scheduled Delivery Date or such later date as requested (which

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request must be made in writing in advance of such deadline) by a Party (if such delay has not been caused by such Party) and consented to by the other Party, which consent may not be unreasonably delayed or withheld; provided that, in no event shall the Delivery Window Deadline be extended more than [\*\*\*] past the Scheduled Delivery Date without the written consent of both parties (such consent may be withheld in each parties' sole discretion).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4&nbsp;&nbsp;&nbsp;&nbsp;**Delivery**. Upon satisfaction or waiver of the conditions precedent for all Items of Equipment set forth in Section 6.1 (other than Excluded Assets), upon Delivery of all such Items of Equipment at the Delivery Location, Buyer shall pay the Purchase Price and deliver an Acceptance Certificate to Seller with respect to each Item of Equipment, and Seller shall execute and concurrently deliver to Buyer the Bill of Sale, whereupon risk of loss to the relevant Item of Equipment shall transfer to Buyer and title to the relevant Item of Equipment shall transfer to Buyer, free and clear of any Liens (other than Buyer's Liens).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5&nbsp;&nbsp;&nbsp;&nbsp;**FAA Documents**. Immediately upon Buyer's provision of a wire transfer number for the wire of the Purchase Price as to such Aircraft, (a) Seller shall instruct FAA Counsel to file the FAA Bill of Sale with the FAA Registry in Oklahoma City, and (ii) Buyer shall instruct FAA Counsel to file the Aircraft Registration Application with the FAA Registry in Oklahoma City. Thereafter, FAA Counsel shall record the contracts of sale for the Airframe and Engines on the International Registry. Prior to the relevant Delivery Date, Seller shall have provided all authorizations necessary for FAA Counsel to effect such registrations on the International Registry.

6.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Conditions Precedent</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;**Conditions Precedent**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Buyer's obligation to purchase an Item of Equipment and Seller's obligation to sell (or to cause to be sold) such Item of Equipment shall be subject to satisfaction (or waiver by the intended beneficiary of the relevant condition precedent) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;a Total Loss shall not have occurred with respect to such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;the representations and warranties made by the other Party in this Agreement shall be true and correct on and as of the Delivery Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;on the Delivery Date, the Item of Equipment shall be located at the Delivery Location;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;receipt of all appropriate governmental or regulatory approvals deemed necessary or advisable by Seller and Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;concurrent with the execution and delivery of this Agreement, Buyer shall also have received the executed Share Purchase Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;all of the conditions precedent under the Share Purchase Agreement shall have been satisfied or waived and the Closing (as defined in the Share Purchase Agreement) shall have occurred; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;no change shall have occurred after the date of this Agreement (in any applicable law or otherwise) which would make it illegal for the Buyer or the Seller to perform any of its obligations under the Transaction Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The obligation of Buyer to purchase an Item of Equipment shall be subject to satisfaction (or waiver by Buyer) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received Transaction Documents for such Item of Equipment to which Seller (or a Seller-Owner) is a party, in each case duly executed and delivered by Seller (or a Seller-Owner);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;such Item of Equipment shall be free and clear of all Liens (but excluding any Buyer's Liens), including any interests on the International Registry, and Buyer shall have received an FAA lien report and priority search certificates from FAA Counsel evidencing the same;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;the applicable Item of Equipment shall meet the Delivery Conditions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received confirmation from FAA Counsel that Seller has (or has caused Seller-Owner to, as applicable) placed in escrow with FAA Counsel the FAA Bill of Sale for such Item of Equipment and provided direction (and any necessary authorizations or consents) to FAA Counsel, upon Delivery and filing of the applicable FAA Bill of Sale, to register a contract of sale for the sale of such Item of Equipment and each associated Engine on the International Registry;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received a duly completed and executed IRS Form W-9 from Seller (or a Seller-Owner, as appropriate) and any other appropriate forms or documentation, in each case establishing a

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complete exemption for any withholding that would otherwise be imposed on any payments made under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall be satisfied that the sale of all Items of Equipment subject to this Agreement shall close simultaneously;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;No Seller's Default shall be continuing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;Buyer will have a reasonable basis to believe that no Transfer Taxes will be imposed with respect to the sale and purchase of the Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;Buyer and Seller shall have agreed under Section 7.1(b) on the treatment for each Item of Equipment that has suffered the damage specified therein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Seller and the Seller-Owner certifying as to (i) the resolutions of its board of directors (or equivalent managing body), duly adopted and in effect, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of its officers authorized to sign this Agreement and the documents to be delivered hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)&nbsp;&nbsp;&nbsp;&nbsp;copies of back-to-birth bills of sale for each Airframe and Engine and priority search certificates showing the Seller-Owner as the current owner, or Buyer shall otherwise be satisfied in its reasonable discretion that Seller-Owner is the current owner of each Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The obligation of Seller to sell an Item of Equipment shall be subject to satisfaction (or waiver by Seller) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall have received Transaction Documents for such Item of Equipment to which Buyer is a party, in each case duly executed and delivered by Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of the full Purchase Price for such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of a duly executed copy from Buyer of the Acceptance Certificate with respect to such Item of Equipment;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;No Buyer's Default shall be continuing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall have received confirmation from FAA Counsel that Buyer has placed in escrow with FAA Counsel the FAA Registration Application and such other documentation required for Buyer to register an Airframe in the United States in the name of the Buyer as owner;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall be satisfied that the sale of all Items of Equipment subject to this Agreement shall close simultaneously other than any Excluded Assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of certificates from Buyer's insurance broker evidencing Buyer's compliance with the insurance provisions of Section 9 hereof with respect to such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;concurrent with the execution and delivery of this Agreement, Seller shall also have received the executed Share Purchase Agreement dated the date hereof between Harbor Diversified, Inc. and CSI Aviation, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;Buyer and Seller shall have agreed under Section 7.1(b) on the treatment for each Item of Equipment that has suffered the damage specified therein; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Buyer certifying as to (i) the resolutions of the board of directors (or equivalent managing body) of the Buyer, duly adopted and in effect, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of the officers of the buyer authorized to sign this Agreement and the documents to be delivered hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2&nbsp;&nbsp;&nbsp;&nbsp;**No Financing or Other Contingencies**. The transactions contemplated herein shall not be subject to or contingent on Buyer obtaining any financing in relation to its acquisition of any Item of Equipment.

7.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Termination</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1&nbsp;&nbsp;&nbsp;&nbsp;**Total Loss before Delivery; Material Damage before Delivery**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;If any Item of Equipment suffers [\*\*\*] prior to Delivery, Seller shall, [\*\*\*] notify Buyer in writing thereof and the Seller's obligations to sell and the Buyer's obligation to purchase the Item of Equipment shall terminate, a Non-

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Sale Event shall have occurred and such Item of Equipment shall become an Excluded Asset.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;If any Item of Equipment suffers damage exceeding [\*\*\*] but less than [\*\*\*] prior to Delivery, Seller shall [\*\*\*] notify Buyer in writing thereof. Following such notice, Buyer and Seller shall determine an appropriate rectification for such damage, before proceeding with the sale of all Items of Equipment hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;If this Agreement is terminated with respect to an Item of Equipment following a Total Loss thereof, then neither Buyer nor Seller shall have any further obligation or liability to the other in respect of the applicable Item of Equipment, and the terms and conditions of the Agreement in respect of such Item of Equipment shall automatically terminate and have no force and effect except for with respect to this subsection, Section 8.4(a) (Limitation of Liability), Section 11.3 (Non-Waiver), Section 11.6 (Governing Law and Jurisdiction), Section 11.10 (Transaction Costs), Section 11.12 (Confidentiality), and Section 11.13 (Third-party Beneficiaries), and in each case of the foregoing any provisions of this Agreement required to give meaning to the aforementioned sections.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2&nbsp;&nbsp;&nbsp;&nbsp;**Default Provisions**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;**Buyer's Default**. If a Buyer's Default should occur then Seller shall be entitled, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;**Seller's Default**. If a Seller's Default should occur then Buyer shall be entitled, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3&nbsp;&nbsp;&nbsp;&nbsp;**Effect of Termination**. Notwithstanding the foregoing, each party hereto may exercise any other right or remedy, if any, which may be available to it under applicable law or the Transaction Documents in respect of such Item of Equipment (if they have been entered into) and each party shall retain any and all claims, if any, for damages under such Transaction Documents (if they have been entered into) or under applicable law for any breach of any agreement, representation, warranty or covenant contained in this Agreement or such Transaction Documents (if they have been entered into).

8.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Representations and Warranties; Disclaimers and Waivers</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1&nbsp;&nbsp;&nbsp;&nbsp;**Seller Representations and Warranties**.

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Seller represents and warrants to Buyer that the following statements are as of the date hereof and at each Delivery true and accurate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Seller and Seller-Owner are organized and validly existing under the Laws of their jurisdiction of formation and have the power and authority to carry on their business as presently conducted and to perform its obligations under the Transaction Documents to which they are a Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;each of the Transaction Documents to which Seller and Seller-Owner are a Party have been (or will be, when executed) duly authorized, entered into and delivered by them, constitutes the legal, valid and binding obligation enforceable against it in accordance with its terms (subject to bankruptcy, insolvency, reorganization or similar Laws of general application affecting the enforcement of creditors' rights generally);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution and delivery of the Transaction Documents to which Seller or Seller-Owner are a Party, nor the consummation of the transactions contemplated thereby nor compliance by it with any of the terms and provisions thereof will contravene any Law applicable to Seller or Seller-Owner or result in any breach of, or constitute a default under any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, bank loan or credit agreement, partnership agreement, or other agreement or instrument to which Seller or Seller-Owner is a Party or by which it or its properties or assets are bound or affected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution, delivery or performance by Seller or Seller-Owner of the Transaction Documents to which they are a Party, nor the consummation by them of any of the transactions contemplated thereby, will require the consent or approval of, the giving of notice to, or the taking of any other action in respect of, the shareholders, or the trustee or holder of any indebtedness of theirs, except such as have been or will be obtained or effected, each of which approvals, consents and waivers shall be in full force and effect on the Delivery Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;immediately prior to Delivery, Seller-Owner will have full legal and beneficial title in and to the relevant Item of Equipment, free and clear of any Liens over such Item of Equipment other than Buyer's Liens, and at Delivery Seller-Owner shall convey to Buyer good and marketable title to the Item of Equipment free and clear of any Liens (other than Buyer's Liens);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;there are no suits, actions, arbitration proceedings or claims pending or, to the knowledge of Seller, threatened against Seller or Seller-Owner

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arising out of or in connection with any Item of Equipment or the Transaction Documents before or by any Government Entity or that if adversely determined would affect the ability of Seller or Seller-Owner to consummate the transactions contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;Seller and Seller-Owner comply with all applicable anti-money laundering laws, anti-corruption laws and U.S. or other applicable export control and sanctions laws and regulations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;neither Seller nor Seller-Owner is the target of any U.S. or other applicable sanctions or export control restrictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Representations and Warranties**.

Buyer represents and warrants to Seller that the following statements are as of the date hereof and at each Delivery true and accurate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;it is duly organized and validly existing under the Laws of its state of organization and has the power and authority to carry on its business as presently conducted and to perform its obligations under the Transaction Documents to which it is a Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;each of the Transaction Documents to which it is a Party has been (or will be, when executed) duly authorized, entered into and delivered by Buyer and constitutes the legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms (subject to bankruptcy, insolvency, reorganization or similar Laws of general application affecting the enforcement of creditors' rights generally);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution and delivery of the Transaction Documents to which it is a Party, nor the consummation of the transactions contemplated thereby nor compliance by it with any of the terms and provisions thereof will contravene any Law applicable to it or result in any breach of, or constitute a default under any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, bank loan or credit agreement, corporate charter or by-laws, or other agreement or instrument to which it is a Party or by which its or its properties or assets are bound or affected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution, delivery or performance by it of the Transaction Documents to which it is a Party, nor the consummation by it of any of the transactions contemplated hereby or thereby, will require the consent or approval of, the giving of notice to, or the taking of any other action in respect of, the members, or the trustee or holder of any indebtedness of Buyer, except such as

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have been or will be obtained or effected, each of which approvals, consents and waivers shall be in full force and effect on the Delivery Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;there are no suits, actions, arbitration proceedings or claims pending or, to the knowledge of Buyer, threatened against Buyer arising out of or in connection with the Transaction Documents before or by any Government Entity or that if adversely determined would affect the ability of Buyer to consummate the transactions contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;it complies with all applicable anti-money laundering laws, anti-corruption laws and U.S. or other applicable export control and sanctions laws and regulations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;it is not the target of any U.S. or other applicable sanctions or export control restrictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3&nbsp;&nbsp;&nbsp;&nbsp;**Disclaimers**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE BILL OF SALE WITH RESPECT TO AN ITEM OF EQUIPMENT, AND WITHOUT LIMITING ANY OF THE RIGHTS OR REMEDIES OF BUYER UNDER THIS AGREEMENT, EACH ITEM OF EQUIPMENT IS BEING SOLD ON ITS RESPECTIVE DELIVERY DATE TO BUYER IN "AS IS", "WHERE IS" AND "WITH ALL FAULTS" CONDITION WITHOUT ANY REPRESENTATION, GUARANTEE OR WARRANTY OF THE SELLER, EXPRESS OR IMPLIED, OF ANY KIND, ARISING BY LAW OR OTHERWISE AS TO THE CONDITION THEREOF; AND

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;WITHOUT LIMITING THE GENERALITY OF SECTION 8.3(a), EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE BILL OF SALE WITH RESPECT TO AN ITEM OF EQUIPEMENT, BUYER UNCONDITIONALLY AGREES THAT EACH ITEM OF EQUIPMENT, AND EACH PART THEREOF ARE TO BE SOLD AND PURCHASED IN AN "AS IS", "WHERE IS" AND "WITH ALL FAULTS" CONDITION AS AT THE RELEVANT DELIVERY DATE APPLICABLE THERETO, AND NO TERM, CONDITION, WARRANTY, REPRESENTATION OR COVENANT OF ANY KIND HAS BEEN ACCEPTED, MADE OR IS GIVEN BY SELLER, IN RESPECT OF THE AIRWORTHINESS, VALUE, QUALITY, DURABILITY, TITLE, CONDITION, DESIGN, OPERATION, DESCRIPTION, MERCHANTABILITY OR FITNESS FOR USE OR PURPOSE OF THE ITEM OF EQUIPMENT, ANY ENGINE OR ANY PART THEREOF, AS TO THE ABSENCE OF LATENT,

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INHERENT OR OTHER DEFECTS (WHETHER OR NOT DISCOVERABLE), AS TO THE ACCURACY, VALIDITY, TRACEABILITY, COMPLETENESS OR CONDITION OF THE RECORDS, OR AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, COPYRIGHT, DESIGN, OR OTHER PROPRIETARY RIGHTS; AND ALL CONDITIONS, WARRANTIES AND REPRESENTATIONS (OR OBLIGATION OR LIABILITY, IN CONTRACT OR IN TORT) IN RELATION TO ANY OF THOSE MATTERS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, ARE EXPRESSLY EXCLUDED.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;EXECUTION AND DELIVERY OF AN ACCEPTANCE CERTIFICATE BY BUYER TO SELLER SHALL BE CONCLUSIVE PROOF THAT THE APPLICABLE ITEM OF EQUIPMENT AND EACH PART THEREOF DESCRIBED IN SUCH ACCEPTANCE CERTIFICATE ARE AS OF THE DATE OF SUCH EXECUTION AND DELIVERY IN EVERY WAY SATISFACTORY TO BUYER AND HAVE BEEN ACCEPTED BY BUYER FOR ALL PURPOSES OF THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;DISCLAIMER OF APPLICATION OF C.I.S.G. THE PARTIES HEREBY EXPRESSLY DISCLAIM THE APPLICATION OF THE UNITED NATIONS CONVENTION ON THE INTERNATIONAL SALE OF GOODS TO THE EXTENT APPLICABLE TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4&nbsp;&nbsp;&nbsp;&nbsp;**LIMITATION OF LIABILITY; WAIVER**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;BUYER AND SELLER EACH AGREE THAT NEITHER BUYER NOR SELLER SHALL BE ENTITLED TO RECEIVE AND EACH HEREBY DISCLAIMS AND WAIVES ANY RIGHT THAT IT MAY OTHERWISE HAVE TO RECOVER OR SEEK TO RECOVER FROM THE OTHER PARTY PUNITIVE, EXEMPLARY SPECIAL, INDIRECT, REMOTE, SPECULATIVE, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF SALES, LOSS OF REVENUE OR LOSS OF OPPORTUNITY), IN EACH CASE WHETHER IN TORT (INCLUDING NEGLIGENCE OR GROSS NEGLIGENCE), STRICT LIABILITY, BY CONTRACT, STATUTE OR OTHERWISE, RESPECT OF ANY CLAIM MADE UNDER OR IN CONNECTION WITH THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;BUYER HEREBY AGREES THAT ITS ACCEPTANCE OF AN ITEM OF EQUIPMENT AT DELIVERY AND ITS EXECUTION AND DELIVERY OF AN ACCEPTANCE CERTIFICATE IN RESPECT OF EACH ITEM OF EQUIPMENT CONSTITUTE BUYER'S WAIVER OF ANY

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WARRANTY OF DESCRIPTION, EXPRESS OR IMPLIED, AND ANY CLAIMS BUYER MAY HAVE AGAINST SELLER OR ANY PARTY ACTING FOR OR ON BEHALF OF SELLER BASED UPON THE FAILURE OF THE ITEM OF EQUIPMENT TO CONFORM WITH SUCH DESCRIPTION.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;DELIVERY BY BUYER TO SELLER OF AN ACCEPTANCE CERTIFICATE IN RESPECT OF EACH ITEM OF EQUIPMENT WILL BE CONCLUSIVE PROOF AS BETWEEN SELLER, ON THE ONE HAND, AND BUYER, ON THE OTHER HAND, THAT BUYER'S TECHNICAL EXPERTS HAVE EXAMINED AND INVESTIGATED EACH ITEM OF EQUIPMENT (INCLUDING THE ENGINES) AND HAVE UNCONDITIONALLY AND IRREVOCABLY ACCEPTED SUCH ITEM OF EQUIPMENT.

9.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Insurance</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1&nbsp;&nbsp;&nbsp;&nbsp;**Insurances**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;For the period commencing on the Delivery Date for an Item of Equipment and ending on the earlier of (a) the [\*\*\*] of the Delivery Date of such Item of Equipment and (b) the completion of the next "C-check" due under the GMM for such Item of Equipment (the "**<u>Insurance Period</u>**"), Buyer will carry or cause to be carried and maintained, comprehensive airline legal liability insurance, including but not limited to third party, passenger, baggage, cargo, mail and products liability insurance including without limitation, war risk and allied perils, in an amount of not less than [\*\*\*]. Notwithstanding the foregoing, for any period of the Insurance Period that any Item of Equipment is in storage and not being operated, Buyer may maintain (or cause to be maintained) with respect to such Item of Equipment and only for such period of the Insurance Period that such Item of Equipment is in storage and not being operated, comprehensive aviation liability insurance (including, but not limited to, contractual liability and products liability) in an amount not less than [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;All policies carried in accordance with this Section 9.1 and any policies taken out in substitution or replacement for any such policies, (i) shall include the Seller Parties as additional insureds (but not as manufacturer, repairer or servicing agent of the Item of Equipment, and without imposing on any such party liability to pay premiums with respect to such insurance) as respects the operation of the operator, (ii) shall be maintained with insurers of recognized standing and normally participating in the leading international commercial aviation insurance markets (through reinsurance, if necessary), (iii) shall provide that if the insurers cancel such insurance for any reason, or if the same is allowed

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to lapse for non-payment of premium or if any material change is made in the insurance which adversely affects the interest of the Seller Parties, such lapse, cancellation or change shall not be effective as to the Seller Parties and each of them for [\*\*\*] in the case of war risk and allied perils coverage) after written notice by such insurers of such lapse, cancellation or change, provided, however, that if any notice period specified above is not reasonably obtainable, such policies shall provide for as long a period of prior notice as shall then be reasonably obtainable, (iv) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were separate policy covering each insured, (v) provide that the insurers will waive any right to any setoff, recoupment, subrogation or counterclaim or any other deduction, by attachment or otherwise, and (vi) be primary and without right of contribution from any insurance which may be carried by the Seller Parties and any of them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2&nbsp;&nbsp;&nbsp;&nbsp;**Certificates, Etc**. On or before the Delivery Date for each Item of Equipment, Buyer and Seller shall cooperate to cause Buyer to provide to Seller a certificate of insurance evidencing the coverage required pursuant to this Section 9 and Buyer shall provide to Seller, as applicable, an updated certificate of insurance upon each renewal or replacement of the coverage required pursuant to this Section 9. Seller agrees that any insurance certificate issued by Air Wisconsin Airlines LLC for an Item of Equipment during the Insurance Period shall satisfy the requirements of this Section 9 so long as it lists Seller Parties as additional insureds.

10.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Transfer Taxes; Indemnities</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1&nbsp;&nbsp;&nbsp;&nbsp;**Transfer Taxes.** Each Party is responsible for researching its own tax position in relation to the transactions contemplated by the Transaction Documents, at its own cost and for its sole benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;**Tax Indemnity**. Buyer shall, on an after-tax basis, pay, indemnify and hold Seller and its Affiliates harmless from any and all sales, use, transfer, value-added, or other similar taxes, together with any penalties, fines, or interest thereon, imposed, levied, or assessed on or with respect to the sale or Delivery of, or transfer of title to, any Item of Equipment by Seller to Buyer hereunder, other than (i) taxes imposed on or calculated by reference to the net income, profits or gains of Seller; (ii) franchise taxes, commercial activity taxes, (iii) taxes to the extent imposed as result of Seller's failure to comply with the terms of this Agreement; (iv) taxes imposed, levied or assessed to the extent arising out of or in connection with the ownership, import, export, possession, operation, use, maintenance, return, or storage of the Item of Equipment prior to the Delivery, except any sales, use, transfer, excise, value-added, or other similar taxes on or

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

with respect to the sale or Delivery of, or transfer of title to, the Item of Equipment by Seller to Buyer hereunder, and (v) taxes to the extent arising as a result of the gross negligence or willful misconduct of Seller or any of its Affiliates or resulting from any inaccuracy of any representation or warranty of Seller hereunder (any or all of the foregoing, "**<u>Transfer Taxes</u>**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;**Cooperation**. The Parties shall reasonably cooperate with one another to deliver to each other such certifications and other documents as may be reasonably requested in order to avail of any applicable exemption from Transfer Taxes. Without limiting the foregoing, at or prior to the Delivery of each Item of Equipment, Buyer shall either (i) pay any Transfer Taxes imposed, levied, or assessed on or with respect to the sale or Delivery of, or transfer of title to, such Item of Equipment or (ii) provide to Seller a duly completed and validly executed exemption certificate, resale certificate, or other documentation reasonably satisfactory to Seller establishing a complete exemption from Transfer Taxes with respect to the sale or Delivery of, or transfer of title to, such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;**Seller Indemnities**. Subject to the other terms and conditions of this Section 10.2, Seller shall defend, indemnify, and hold harmless the Buyer and its respective shareholders, members, directors, managers, officers, and employees from and against [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Indemnities**. Subject to the other terms and conditions of this Section 10.3 the Buyer shall defend, indemnify, and hold harmless the Seller and its respective members, managers, directors, officers, and employees from and against [\*\*\*].

11.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Miscellaneous</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1&nbsp;&nbsp;&nbsp;&nbsp;**Entire Agreement, Amendment, and Installment Contract**. Except as expressly provided herein, this Agreement together with the other Transaction Documents constitutes the entire agreement among the parties relating to the subject matter hereof and thereof and supersedes any and all previous agreements and understandings, oral or written, relating to the subject matter hereof and thereof. In the event of any conflict between any term or provision in any of this Agreement or any other Transaction Document and any term or provision in any term sheet, the terms and provisions of this Agreement or such any other Transaction Document shall control and govern. This Agreement may not be amended except by an instrument in writing signed by or on behalf of each Party. The Parties acknowledge and agree that this Agreement is an installment contract, and accordingly (except in connection with a termination of this Agreement pursuant to Section 7.3), the inability or failure of the Delivery of any Item of Equipment, will not relieve the obligation of the Seller to sell, and the Buyer to buy, the remaining Items of Equipment.

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------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2&nbsp;&nbsp;&nbsp;&nbsp;**Time of the Essence to Complete Purchase of Item of Equipment**. The Parties agree that time shall be of the essence of this Agreement with respect to closing and delivering every Item of Equipment by the Delivery Window Deadline. Additionally, each of the Parties shall act in a commercially reasonable manner to effect the transactions contemplated under this Agreement in a prompt manner and in accordance with the time periods and deadlines provided herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3&nbsp;&nbsp;&nbsp;&nbsp;**Non-Waiver**. Any of the terms, covenants, or conditions hereof may be waived only by a written instrument executed by or on behalf of the Party hereto waiving compliance. No course of dealing on the part of any Party hereto, or its respective officers, employees, agents, accountants, attorneys, investment bankers, consultants, or other authorized representatives, nor any failure by a Party hereto to exercise any of its rights under this Agreement shall operate as a waiver thereof or affect in any way the right of such Party at a later time to enforce the performance of such provision. No waiver by any Party hereto of any condition, or any breach of any term or covenant contained in this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term or covenant. Except as otherwise provided in this Agreement, the rights of the Parties hereto under this Agreement shall be cumulative, and the exercise or partial exercise of any such right shall not preclude the exercise of any other right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4&nbsp;&nbsp;&nbsp;&nbsp;**Severability**. In the event that any provision of this Agreement or the application thereof to any Party shall, to any extent, be invalid or unenforceable under any applicable Law, then such provision shall be deemed inoperative to the extent that it is invalid or unenforceable and the remainder of this Agreement, and the application of any such invalid or unenforceable provision to the Parties, jurisdictions or circumstances other than to whom or to which it is held invalid or unenforceable, shall not be affected thereby nor shall the same affect the validity or enforceability of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.5&nbsp;&nbsp;&nbsp;&nbsp;**Notices**. Any notice, request or information required or permissible under this Agreement will be in writing and in the English language. Notices must be addressed to the Parties as set forth below and delivered in person or sent by electronic mail or by expedited delivery, with a copy sent by e-mail. Any such notice shall be effective when received. In the case of a notice sent by expedited delivery, notice will be deemed received on the date of delivery set forth in the records of the Person which accomplished the delivery. If any notice is sent by more than one of the above listed methods, notice will be deemed received on the earliest possible date in accordance with the above provisions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Seller:

Harbor Diversified, Inc.

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

W6390 Challenger Drive, Suite 203

Appleton, WI 54914

Attention: [\*\*\*]

Telephone: [\*\*\*]

E mail: [\*\*\*]

Attention: [\*\*\*]

Telephone: [\*\*\*]

E mail: [\*\*\*]

(with copies to [\*\*\*])

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Buyer:

CSI Aviation, Inc.

6006 Reese Creek Rd

Killeen, Texas 76549

Attention: [\*\*\*]

Telephone: [\*\*\*]

Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.6&nbsp;&nbsp;&nbsp;&nbsp;**Governing Law and Jurisdiction**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;This Agreement, the Transaction Documents, and all ancillary agreements and documents relating hereto, shall be governed by and construed in accordance with the Laws of the State of New York, including all matters of construction, validity, and performance, without reference to principles of conflicts of Law other than sections 5-1401 and 5-1402 of the New York general obligations Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Each of the Parties irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City and County of New York and to the non-exclusive jurisdiction of the U.S. District Court for the Southern District of New York located in the Borough of Manhattan to settle any dispute or claim that arises out of or in connection with this Agreement (including any non-contractual disputes or claims in connection herewith or therewith).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Each party hereto waives objection to such courts on the grounds of inconvenient forum, venue or otherwise as regards proceedings in connection with this Agreement and other documents related hereto and agrees that (subject to permitted appeals) a judgment or order of such a court in connection with this

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Agreement or the other documents related hereto is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.7&nbsp;&nbsp;&nbsp;&nbsp;**Waiver of Jury Trial**. Each Party, to the extent permitted by Law, knowingly, voluntarily, and intentionally waives its right to a trial by jury in any action or other legal proceeding for matters, contractual, tortious, or otherwise, arising out of or relating to this Agreement and the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.8&nbsp;&nbsp;&nbsp;&nbsp;**Further Assurances**. Each Party hereto will promptly and duly execute and deliver such further documents to make such further assurances for and take such further action reasonably requested by any Party to whom such first Party is obligated, all as may be reasonably necessary to carry out more effectively the intent and purpose of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.9&nbsp;&nbsp;&nbsp;&nbsp;**Counterparts**. This Agreement may be executed in any number of counterparts and by any Party hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which, when taken together, shall constitute one and the same agreement. Counterparts may be delivered via electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.10&nbsp;&nbsp;&nbsp;&nbsp;**Transaction Costs**. Each Party shall bear its own costs and expenses (including attorney's fees) in relation to the negotiation and documentation of, and consummation of the transactions contemplated by this Agreement, and any other ancillary documents or agreement and the transactions contemplated hereby and thereby. In respect of the sale of each Item of Equipment, Seller and Buyer will share equally in the costs of FAA Counsel in the filing and registration of the sale of the Item of Equipment on the FAA's Civil Aviation Registry and on the International Registry, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.11&nbsp;&nbsp;&nbsp;&nbsp;**Assignment, Successors and Assigns**. Except as expressly provided in Section 2.3, neither Seller nor Buyer shall assign or transfer all or any of its rights and/or obligations under this Agreement without the prior written consent of the other Party, which may be withheld, conditioned, or delayed in such other Party's sole and absolute discretion; provided that, no assignment will relieve the assigning Party of any of its rights or obligations. This Agreement shall bind and inure to the benefit of the Parties and any successors, and in each case permitted hereunder, assigns to the original Parties to this Agreement.

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.12&nbsp;&nbsp;&nbsp;&nbsp;**Confidentiality**. The terms and conditions of this Agreement are available only to Buyer and Seller and, in signing this Agreement, Buyer and Seller each acknowledge and agree that the terms and existence of this Agreement represent non-public, confidential and proprietary information ("**<u>Confidential Information</u>**"). Each party (including their respective officers, directors, employees, agents and advisers) agrees that it will not disclose Confidential Information to any third party; provided, however, that the Parties may disclose the Confidential Information (i) to their and their affiliates' officers, directors, members, managers, employees, attorneys, accountants, consultants, shareholders and advisors (collectively, "**<u>Representatives</u>**") who need to know such information for the purpose of discussing and/or evaluating the transaction contemplated hereby and who agree not to disclose the Confidential Information, (ii) to any actual or potential participant, assignee or lender of Buyer (or any of their respective Representatives) who need to know such information for the purpose of discussing and/or evaluating such participation, assignment or financing, as the case may be, and who agree not to disclose the Confidential Information, (iii) solely with respect to the identity of the Item of Equipment (and component engines, components, parts, systems and other equipment) and the technical specifications and delivery dates of such, to potential lessees or of other customers of Buyer (and their respective Representatives) of any of the Item of Equipment or equipment, and (iv) as requested or required in connection with a judicial, administrative or regulatory proceeding in which it or a partner, officer, director, member, manager, employee or affiliate is involved, pursuant to a court order or subpoena by a regulatory or government inquiry or demand, or as otherwise required by applicable law or regulation, including stock exchange rules. Notwithstanding the foregoing, the parties and their Affiliates may make any disclosure and filings in connection with any securities filing or other filings required the Securities and Exchange Commission as advised by legal counsel without requiring consent of the other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.13&nbsp;&nbsp;&nbsp;&nbsp;**Third-party Beneficiaries**. Except as provided in Sections 9 and 10, this Agreement is not intended to and shall not provide any Person not a Party hereto with any rights, of any nature whatsoever, against any of the Parties hereto, and no Person or entity not a Party hereto shall have any right, power, privilege, benefit, or interest arising out of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.14&nbsp;&nbsp;&nbsp;&nbsp;**[Intentionally Omitted]**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.15&nbsp;&nbsp;&nbsp;&nbsp;**Force Majeure**. Neither party shall be liable for any failure of or delay in the Delivery of an Item of Equipment, or in any other obligation hereunder for the period that such failure or delay is due to acts of God or the public enemy; war, insurrection or riots; fires, governmental actions; strikes or labor disputes; pandemic, epidemic, or quarantine mandate; inability to obtain materials, accessories, or parts from the vendors; or any other cause beyond such parties' reasonable control. Upon the occurrence of any such event, the time required for performance by such party of its obligations arising

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------

under this Agreement shall be extended by a period equal to the duration of such event. In the event that such extension continues for more than [\*\*\*], then either Party may terminate this Agreement in respect of the purchase and sale of the Item of Equipment subject to such delay, and an Item of Equipment Non-Sale Event shall be deemed to have occurred with respect to such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.16&nbsp;&nbsp;&nbsp;&nbsp;**Publicity**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Neither Party will issue any press release or make any public announcement relating to the subject matter of this Agreement without the prior written approval of the other Party, except that either Party may make any public disclosure it believes in good faith is required by applicable Law or stock exchange rules. Notwithstanding the foregoing, if either Party, or a third party, makes a public disclosure related to this Agreement that is false or damaging to a Party, the aggrieved Party will have the right to make a public response reasonably necessary to correct any misstatement, inaccuracies or material omissions in the initial and wrongful affirmative disclosure without prior approval of the other Party. Neither Party will be required to obtain consent pursuant to this section for any proposed release or announcement that is consistent with information that has previously been made public without breach of its obligations under this clause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Neither Party will, without the other Party's prior written consent in each instance (x) use in advertising, publicity or marketing communications of any kind the name or other trademarks of the other Party or any of its Affiliates, or any employee of either, or (y) represent, directly or indirectly, that any product or service provided by a Party has been approved or endorsed by the other Party or any of its Affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17&nbsp;&nbsp;&nbsp;&nbsp;**Relationship of the Parties**. Nothing contained in this Agreement shall be deemed to create an association, partnership, joint venture, or relationship of principal and agent or master and servant between the Parties, or to grant either Party the right or authority to assume, create or incur any liability or obligation of any kind, express or implied, against, in the name of, or on behalf of, the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18&nbsp;&nbsp;&nbsp;&nbsp;**Brokers and other Third Parties**. Each Party represents and warrants to the other that it has not paid, agreed to pay or caused to be paid directly or indirectly in any form, any commission, percentage, contingent fee, brokerage or other similar payments of any kind in connection with this Agreement or the transactions contemplated hereby, to any Person. Each Party agrees to indemnify and hold the other harmless from and against any and all claims, suits, damages, costs and expenses (including, but not limited to reasonable attorneys' fees and costs) asserted by any agent, broker or other

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

------

third party for any commission or compensation of any nature whatsoever based upon this Agreement or the Transaction Documents or any Item of Equipment.

<br>[SIGNATURE PAGE FOLLOWS]

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------

IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement as of the day and year first above written.

<u>SELLER</u>:

HARBOR DIVERSIFIED, INC.

By:&nbsp;&nbsp;&nbsp;&nbsp;*<u>/s/ Christine R. Deister</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>

Name: <u>Christine R. Deister&nbsp;&nbsp;&nbsp;&nbsp;</u>

Title:&nbsp;&nbsp;&nbsp;&nbsp;<u>Chief Executive Officer and Secretary</u>

<u>BUYER</u>:

CSI AVIATION, INC.

By:&nbsp;&nbsp;&nbsp;&nbsp;*<u>/s/ Allen Weh</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>

Name: <u>Allen Weh&nbsp;&nbsp;&nbsp;&nbsp;</u>

Title:&nbsp;&nbsp;&nbsp;&nbsp;<u>Chief Executive Officer&nbsp;&nbsp;&nbsp;&nbsp;</u>

Signature Page

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------

**<u>Exhibit A</u>**

**DESCRIPTION OF AIRCRAFT, ENGINES AND EXPENDABLES**

[\*\*\*]

Exhibit A

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------

**<u>Exhibit B</u><br>FORM OF ACCEPTANCE CERTIFICATE**

[\*\*\*]<br>

Exhibit B

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------

**<u>Exhibit C<br></u><br> FORM OF WARRANTY BILL OF SALE**<br> 

<br> [\*\*\*]

Exhibit C

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

## Exhibit 10.11

**Certain confidential information contained in this document, marked by [\*\*\*], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.**

**SALE AND PURCHASE AGREEMENT<br>**

<br> dated as of December 15, 2025

between

HARBOR DIVERSIFIED, INC.<br>as Seller

and

ASSOCIATED ENERGY GROUP LLC<br>as Buyer

____________________________________________<br>Used Airframes and Engines<br>____________________________________________<br>

------

**TABLE OF CONTENTS**

**Page**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;&nbsp;&nbsp;Definitions.&nbsp;&nbsp;&nbsp;&nbsp;[1](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2&nbsp;&nbsp;&nbsp;&nbsp;Interpretation.&nbsp;&nbsp;&nbsp;&nbsp;[5](#if3e1fa843a8241dda41d664aadd2164c_7)

2.&nbsp;&nbsp;&nbsp;&nbsp;Agreements to Sell and Purchase; Assignment of Warranties; Etc.&nbsp;&nbsp;&nbsp;&nbsp;[6](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;&nbsp;Sale and Purchase of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[6](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2&nbsp;&nbsp;&nbsp;&nbsp;Assignment of Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[6](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3&nbsp;&nbsp;&nbsp;&nbsp;Buyer Nominee.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

3.&nbsp;&nbsp;&nbsp;&nbsp;Purchase Price; Transaction Fee; Payment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1&nbsp;&nbsp;&nbsp;&nbsp;Purchase Price&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2&nbsp;&nbsp;&nbsp;&nbsp;Delivery Date Payment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3&nbsp;&nbsp;&nbsp;&nbsp;Payment Instructions.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

4.&nbsp;&nbsp;&nbsp;&nbsp;Aircraft Acceptance.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

5.&nbsp;&nbsp;&nbsp;&nbsp;Delivery of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1&nbsp;&nbsp;&nbsp;&nbsp;Delivery Condition&nbsp;&nbsp;&nbsp;&nbsp;[7](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;Delivery Location.&nbsp;&nbsp;&nbsp;&nbsp;[8](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3&nbsp;&nbsp;&nbsp;&nbsp;Delivery Schedule.&nbsp;&nbsp;&nbsp;&nbsp;[8](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4&nbsp;&nbsp;&nbsp;&nbsp;Delivery&nbsp;&nbsp;&nbsp;&nbsp;[8](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5&nbsp;&nbsp;&nbsp;&nbsp;FAA Documents&nbsp;&nbsp;&nbsp;&nbsp;[8](#if3e1fa843a8241dda41d664aadd2164c_7)

6.&nbsp;&nbsp;&nbsp;&nbsp;Conditions Precedent.&nbsp;&nbsp;&nbsp;&nbsp;[9](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;Conditions Precedent.&nbsp;&nbsp;&nbsp;&nbsp;[9](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2&nbsp;&nbsp;&nbsp;&nbsp;No Financing or Other Contingencies.&nbsp;&nbsp;&nbsp;&nbsp;[12](#if3e1fa843a8241dda41d664aadd2164c_7)

7.&nbsp;&nbsp;&nbsp;&nbsp;Termination.&nbsp;&nbsp;&nbsp;&nbsp;[12](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1&nbsp;&nbsp;&nbsp;&nbsp;Total Loss before Delivery; Material Damage before Delivery.&nbsp;&nbsp;&nbsp;&nbsp;[12](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2&nbsp;&nbsp;&nbsp;&nbsp;Default Provisions.&nbsp;&nbsp;&nbsp;&nbsp;[12](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3&nbsp;&nbsp;&nbsp;&nbsp;Effect of Termination.&nbsp;&nbsp;&nbsp;&nbsp;[13](#if3e1fa843a8241dda41d664aadd2164c_7)

8.&nbsp;&nbsp;&nbsp;&nbsp;Representations and Warranties; Disclaimers and Waivers.&nbsp;&nbsp;&nbsp;&nbsp;[13](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1&nbsp;&nbsp;&nbsp;&nbsp;Seller Representations and Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[13](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2&nbsp;&nbsp;&nbsp;&nbsp;Buyer Representations and Warranties.&nbsp;&nbsp;&nbsp;&nbsp;[14](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3&nbsp;&nbsp;&nbsp;&nbsp;Disclaimers.&nbsp;&nbsp;&nbsp;&nbsp;[15](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4&nbsp;&nbsp;&nbsp;&nbsp;LIMITATION OF LIABILITY; WAIVER.&nbsp;&nbsp;&nbsp;&nbsp;[16](#if3e1fa843a8241dda41d664aadd2164c_7)

9.&nbsp;&nbsp;&nbsp;&nbsp;Insurance.&nbsp;&nbsp;&nbsp;&nbsp;[17](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1&nbsp;&nbsp;&nbsp;&nbsp;Insurances.&nbsp;&nbsp;&nbsp;&nbsp;[17](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2&nbsp;&nbsp;&nbsp;&nbsp;Certificates, Etc.&nbsp;&nbsp;&nbsp;&nbsp;[18](#if3e1fa843a8241dda41d664aadd2164c_7)

i

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------

10.&nbsp;&nbsp;&nbsp;&nbsp;Transfer Taxes; Indemnities.&nbsp;&nbsp;&nbsp;&nbsp;[18](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1&nbsp;&nbsp;&nbsp;&nbsp;Transfer Taxes.&nbsp;&nbsp;&nbsp;&nbsp;[18](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;Seller Indemnities.&nbsp;&nbsp;&nbsp;&nbsp;[19](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3&nbsp;&nbsp;&nbsp;&nbsp;Buyer Indemnities.&nbsp;&nbsp;&nbsp;&nbsp;[19](#if3e1fa843a8241dda41d664aadd2164c_7)

11.&nbsp;&nbsp;&nbsp;&nbsp;Miscellaneous.&nbsp;&nbsp;&nbsp;&nbsp;[20](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1&nbsp;&nbsp;&nbsp;&nbsp;Entire Agreement, Amendment, and Installment Contract.&nbsp;&nbsp;&nbsp;&nbsp;[20](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2&nbsp;&nbsp;&nbsp;&nbsp;Time of the Essence to Complete Purchase of Item of Equipment.&nbsp;&nbsp;&nbsp;&nbsp;[20](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3&nbsp;&nbsp;&nbsp;&nbsp;Non-Waiver.&nbsp;&nbsp;&nbsp;&nbsp;[20](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4&nbsp;&nbsp;&nbsp;&nbsp;Severability.&nbsp;&nbsp;&nbsp;&nbsp;[21](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.5&nbsp;&nbsp;&nbsp;&nbsp;Notices.&nbsp;&nbsp;&nbsp;&nbsp;[21](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.6&nbsp;&nbsp;&nbsp;&nbsp;Governing Law and Jurisdiction.&nbsp;&nbsp;&nbsp;&nbsp;[21](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.7&nbsp;&nbsp;&nbsp;&nbsp;Waiver of Jury Trial.&nbsp;&nbsp;&nbsp;&nbsp;[22](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.8&nbsp;&nbsp;&nbsp;&nbsp;Further Assurances.&nbsp;&nbsp;&nbsp;&nbsp;[22](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.9&nbsp;&nbsp;&nbsp;&nbsp;Counterparts.&nbsp;&nbsp;&nbsp;&nbsp;[22](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.10&nbsp;&nbsp;&nbsp;&nbsp;Transaction Costs.&nbsp;&nbsp;&nbsp;&nbsp;[22](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.11&nbsp;&nbsp;&nbsp;&nbsp;Assignment, Successors and Assigns.&nbsp;&nbsp;&nbsp;&nbsp;[23](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.12&nbsp;&nbsp;&nbsp;&nbsp;Confidentiality.&nbsp;&nbsp;&nbsp;&nbsp;[23](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.13&nbsp;&nbsp;&nbsp;&nbsp;Third-party Beneficiaries.&nbsp;&nbsp;&nbsp;&nbsp;[23](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.14&nbsp;&nbsp;&nbsp;&nbsp;[Intentionally Omitted].&nbsp;&nbsp;&nbsp;&nbsp;[24](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.15&nbsp;&nbsp;&nbsp;&nbsp;Force Majeure.&nbsp;&nbsp;&nbsp;&nbsp;[24](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.16&nbsp;&nbsp;&nbsp;&nbsp;Publicity.&nbsp;&nbsp;&nbsp;&nbsp;[24](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17&nbsp;&nbsp;&nbsp;&nbsp;Relationship of the Parties.&nbsp;&nbsp;&nbsp;&nbsp;[24](#if3e1fa843a8241dda41d664aadd2164c_7)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18&nbsp;&nbsp;&nbsp;&nbsp;Brokers and other Third Parties.&nbsp;&nbsp;&nbsp;&nbsp;[25](#if3e1fa843a8241dda41d664aadd2164c_7)

<u>EXHIBITS</u>

Exhibit A &nbsp;&nbsp;&nbsp;&nbsp;Description of Aircraft and Engines

Exhibit B**&nbsp;&nbsp;&nbsp;&nbsp;**Form of Acceptance Certificate

Exhibit C&nbsp;&nbsp;&nbsp;&nbsp;Form of Warranty Bill of Sale&nbsp;&nbsp;&nbsp;&nbsp;

ii

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

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**SALE AND PURCHASE AGREEMENT**

This SALE AND PURCHASE AGREEMENT (this "**<u>Agreement</u>**") is entered into as of December 15, 2025 by and between HARBOR DIVERSIFIED, INC., a Delaware corporation (hereinafter referred to as "**<u>Seller</u>**"), and ASSOCIATED ENERGY GROUP LLC, a Texas limited liability company (hereinafter referred to as "**<u>Buyer</u>**") (Seller and Buyer are each a "**<u>Party</u>**" and, collectively, the "**<u>Parties</u>**").

RECITALS

WHEREAS, Seller (or a Seller-Owner) owns the Items of Equipment described more fully on Exhibit A hereto, together with all documents and available records pertaining thereto in Seller's (or a Seller-Owner's) possession ("**<u>Records</u>**");

WHEREAS, Seller desires to sell and Buyer desires to purchase, such Items of Equipment owned by Seller (or a Seller-Owner);

WHEREAS, the Parties now desire to enter into this Agreement.

NOW, THEREFOR, in consideration of the mutual promises and covenants herein contained, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

1.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Definitions & Interpretation</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;&nbsp;&nbsp;**Definitions**. The following capitalized terms used herein and not otherwise defined shall have the following respective meanings for all purposes of this Agreement.

"**<u>Acceptance Certificate</u>**" means an acceptance certificate substantially in the form of Exhibit B hereto.

"**<u>Affiliate</u>**" means a Person or an entity that directly or indirectly controls, is controlled by, or is under common control with, another Person or entity, including, among others, executive officers, directors, large stockholders, subsidiaries, parent entities and sister companies.

"**<u>Agreement</u>**" has the meaning given to it in the preamble.

"**<u>Aircraft</u>**" means, individually or collectively, as indicated by the context, an Airframe plus [\*\*\*] Engines associated therewith which may not be installed thereon (each as described on Exhibit A hereto), and all Parts of any thereof, together with the Records relating thereto.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

"**<u>Airframe</u>**" means, individually or collectively, as indicated by context, those certain Bombardier model CL-600 series airframes (excluding the associated Engines), as described in Exhibit A hereto, together with any and all Parts installed thereon, or listed in the Acceptance Certificate, and with all Records relating thereto.

"**<u>Bill of Sale</u>**" means a warranty bill of sale substantially in the form of Exhibit C hereto.

"**<u>Business Day</u>**" means a day other than a Saturday or Sunday on which the banks in Appleton, Wisconsin and New York City, New York, USA are open for the transaction of business of the type required by this Agreement.

"**<u>Buyer</u>**" has the meaning given to it in the preamble.

"**<u>Buyer's Default</u>**" means (i) any failure by Buyer to observe or perform any of its material obligations or (ii) a material breach of a representation contained in Section 8.2, in each case, under this Agreement if such failure continues for [\*\*\*] after written notice thereof is delivered to Buyer from Seller (provided that if the same is not capable of being cured within such [\*\*\*], subject to Buyer having commenced good faith efforts to cure the same, the material breach has thereafter not been cured within [\*\*\*] following receipt of Seller's written notice).

"**<u>Buyer's Liens</u>**" has the meaning given to it in Section 2.1(c).

"**<u>Cape Town Agreements</u>**" means the Cape Town Convention, as supplemented by the Cape Town Item of Equipment Protocol (in each case, the English language version).

"**<u>Cape Town Item of Equipment Protocol</u>**" means The Protocol on International Interests in Mobile Equipment, concluded in Cape Town, South Africa, on November 16, 2001 (the English language version).

"**<u>Cape Town Convention</u>**" means The Convention on International Interests in Mobile Equipment, concluded in Cape Town, South Africa, on November 16, 2001 (the English language version).

"**<u>Civil Aviation Registry</u>**" means the registry of aircraft maintained by the FAA.

"**<u>Confidential Information</u>**" has the meaning given to such term in Section 11.12.

"**<u>Delivery</u>**" means, with respect to any Item of Equipment, delivery of such Item of Equipment pursuant to the terms of this Agreement.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

"**<u>Delivery Condition</u>**" means, with respect to any Item of Equipment, the condition of such Item of Equipment at Delivery as provided in Section 5.1.

"**<u>Delivery Date</u>**" means, with respect to any Item of Equipment, the actual date on which Delivery occurs.

"**<u>Delivery Location</u>**" has the meaning given to such term in Section 5.2.

"**<u>Delivery Window Deadline</u>**" has the meaning given to such term in Section 5.3(b).

"**<u>Dollars</u>**", "**<u>$</u>**" and "**<u>US$</u>**" mean the lawful currency of the United States.

"**<u>Engine</u>**" means each [\*\*\*] engine described in Exhibit A hereto, together with any and all Parts incorporated or installed on or attached thereto, or listed in the Acceptance Certificate, and with the Records relating thereto.

"**<u>Excluded Asset</u>**" means an Item of Equipment that is no longer subject to this Agreement.

**"<u>FAA</u>**" means the United States Federal Aviation Administration.

"**<u>FAA Bill of Sale</u>**" means, with respect to an Aircraft, an FAA Form AC 8050-2 bill of sale (or any successor form thereto established and accepted by the FAA).

"**<u>FAA Counsel</u>**" means the law firm of Crowe and Dunlevy, a Professional Corporation, or such other law firm as agreed between the Parties.

"**<u>FAA Registration Application</u>**" means, with respect to an Airframe, an FAA Form AC 8050-1 airframe registration application document (or any successor form thereto established and accepted by the FAA) required to register airframe for operation within the United States.

"**<u>GMM</u>**" means the General Maintenance Manual for the applicable Item of Equipment.

"**<u>Government Entity</u>**" means the United States government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory, or administrative functions of or pertaining to any such government.

"**<u>Insurance Period</u>**" has the meaning given to it in Section 9.1.

"**<u>International Interests</u>**" has the meaning ascribed to the term "international interests" under the Cape Town Agreements.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

"**<u>International Registry</u>**" has the meaning ascribed to the term "international registry" under the Cape Town Agreements.

"**<u>Item of Equipment</u>**" or "**<u>Item</u>**" mean individually or collectively, as the context requires, an Aircraft, an Airframe or any Engine.

"**<u>Law</u>**" means any (a) Law, statute, decree, constitution, regulation, order or directive of any Government Entity, (b) treaty, pact, compact or other agreement to which any Government Entity is a signatory or party, (c) judicial or administrative interpretation or application of any of the foregoing or (d) any binding judicial precedent having the force of Law in any Government Entity.

"**<u>Lien</u>**" means any lien, security interest, lease, sublease, wet-lease, charter, mortgage, pledge, assignment, International Interest on the International Registry (but not any contract of sale registration on the International Registry), title retention or other charge or encumbrance or claim or right of others or agreement the effect of which is the creation of security, including, without limitation, rights of others.

"**<u>Non-Sale Event</u>**" means the obligation of the Seller and the Purchaser under this Agreement with respect to an Item of Equipment shall terminate and the Parties shall have no further obligation as to such Item of Equipment, except as set forth in Section 7.1(c).

"**<u>Parts</u>**" mean all appliances, avionics, components, parts, instruments, appurtenances, accessories, furnishings, seats, galleys, galley equipment, serving equipment, lavatories, cargo handling equipment, safety equipment and other equipment of whatever nature (other than complete Engines or engines) incorporated or installed or positioned in or on or attached to any Airframe or any Engine.

"**<u>Party</u>**" has the meaning given to it in the preamble.

"**<u>Person</u>**" means any individual, corporation, partnership, limited liability company, joint venture, association, joint stock company, company, firm, trust, organization, government, or any agency or political subdivision thereof or any other entity, whether or not having a separate legal personality.

"**<u>Purchase Price</u>**" with respect to each Item of Equipment has the meaning given to it in Section 3.1.

"**<u>Records</u>**" has the meaning given to it in the recitals.

"**<u>Representatives</u>**" has the meaning given to it in Section 11.12.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

"**<u>Scheduled Delivery Date</u>**" means the date that is [\*\*\*] following the date of this Agreement.

"**<u>Seller</u>**" has the meaning given to it in the preamble.

"**<u>Seller's Default</u>**" means (i) any failure by Seller or a Seller-Owner to observe or perform any of its material obligations or (ii) a material breach of a representation contained in Section 8.1, in each case, under this Agreement if such failure continues for [\*\*\*] after written notice thereof is delivered to Seller from Buyer (provided that if the same is not capable of being cured within such [\*\*\*], subject to Seller having commenced good faith efforts to cure the same, the material breach has thereafter not been cured within [\*\*\*] following receipt of Buyer's written notice).

"**<u>Seller-Owner</u>**" means either Air Wisconsin Airlines LLC or Lotus Aviation Leasing, LLC, as the case may be.

"**<u>Seller Parties</u>**" means Seller, its subsidiaries and parent organizations, and each of its and their directors, officers, shareholders, members, controlling Persons, agents, employees, subsidiaries, Affiliates, servants, successors, assigns and transferees of the foregoing parties (each, a "**<u>Seller Party</u>**").

"**<u>Share Purchase Agreement</u>**" means the share purchase agreement dated the date hereof between Harbor Diversified, Inc. and CSI Aviation, Inc.

"**<u>Total Loss</u>**" means, as applicable, the actual, constructive or arranged total loss of an Item of Equipment.

"**<u>Transaction Documents</u>**" means this Agreement, any Bills of Sale, any Acceptance Certificates, the FAA Bills of Sale, and any other document, instrument, or certificate issued pursuant to, or amending or modifying any of the foregoing that is entered into by one or more Parties.

"**<u>Transfer Taxes</u>**" has the meaning given to it in Section 10.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2&nbsp;&nbsp;&nbsp;&nbsp;**Interpretation**. All references in this Agreement to Exhibits, Sections, paragraphs, subsections, clauses and other subdivisions refer to the corresponding Exhibits, Sections, paragraphs, subsections, clauses and other subdivisions of or to this Agreement unless expressly provided otherwise. Titles appearing at the beginning of any Sections, paragraphs, subsections, or other subdivisions of this Agreement are for convenience only, do not constitute any part of this Agreement, and shall be disregarded in construing the language hereof. The words "this Agreement," "herein," "hereby," "hereunder," and "hereof," and words of similar nature, refer to this Agreement as a whole and not to any particular Section, subsection, or other subdivision unless expressly

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

so limited. The words "this Section," and "this subsection," and words of similar nature, refer only to the Section, or subsection hereof in which such words occur. The word "including" (in its various forms) means "including without limitation". Pronouns in masculine, feminine, or neutral genders shall be construed to state and include any other gender, and words, terms, and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. Exhibits and Appendices referred to herein are attached hereto. Except as otherwise provided in this Agreement, any reference herein to any Law shall be construed as referring to such Law as amended, modified, codified, or reenacted, in whole or in part, and in effect from time to time, and references to particular provisions of a Law include a reference to the corresponding provisions of any prior or succeeding Law, and any reference herein to a document includes that document as amended from time to time in accordance with its terms, and any document entered into in substitution or replacement therefor. Any reference to an amendment includes a supplement, novation, or re-enactment, and "amended" is to be construed accordingly. The word "extent" in the phrase "to the extent" means the degree to which a subject or other theory extends, and such phrase shall not simply mean "if". Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. Whenever any action must be taken hereunder on or by a day that is not a Business Day, then such action may be validly taken on or by the next day that is a Business Day. Any reference to any federal, state, local, or foreign Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context shall otherwise require. Reference herein to "federal" shall be construed as referring to U.S. federal.

2.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Agreements to Sell and Purchase; Assignment of Warranties; Etc</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1&nbsp;&nbsp;&nbsp;&nbsp;**Sale and Purchase of Item of Equipment**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Subject to the terms and conditions of this Agreement and the applicable Transaction Documents, Seller agrees to sell (or to cause a Seller-Owner to sell) and Buyer agrees to accept and purchase each Item of Equipment identified in Exhibit A hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The consideration payable with respect to each Item of Equipment will be the Purchase Price for such Item of Equipment as set forth on Exhibit A hereto, and, with respect to each Aircraft, the aggregate Purchase Price of the applicable Airframe and [\*\*\*] Engines.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Upon payment of the Purchase Price in respect of an Item of Equipment in accordance with the applicable provisions of this Agreement, Seller (or a Seller-Owner) shall, by execution and delivery to Buyer of a Bill of Sale, sell to Buyer outright good and marketable title in and to each Item of Equipment,

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;With respect to each Item of Equipment, concurrently with Seller's delivery to Buyer of an executed Bill of Sale for such Item of Equipment, Buyer shall accept delivery of such Item of Equipment, and Buyer shall execute and deliver an Acceptance Certificate in respect of such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2&nbsp;&nbsp;&nbsp;&nbsp;**Assignment of Warranties**. Seller hereby assigns to the Buyer, effective as of the Delivery Date for the applicable Item of Equipment, any and all existing assignable warranties, covenants or assignments of rights of warranties, and service life policies, or other rights, remedies or claims against manufacturers, suppliers, vendors and maintenance and overhaul agencies, or any other person or entity relating to an Item of Equipment. Seller makes no representation or warranty as to the existence or assignability of any such warranties and rights. After the Delivery Date, Seller will, at its own cost and expense, cooperate with reasonable written requests from Buyer, including entering into such documents as may be customary, to deliver to Buyer the benefits intended by this Section 2.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Nominee**. Buyer shall have the right by written notice to Seller, to nominate a subsidiary or owner trust of which the beneficiary is Buyer or a subsidiary of Buyer ("**Buyer Nominee**"), to take title to any Item of Equipment in lieu of Buyer. The nomination of a Buyer Nominee shall not relieve Buyer of its obligations under this Agreement; provided that performance by Buyer Nominee of the obligations of Buyer shall discharge such obligation pro tanto.

3.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Purchase Price; Transaction Fee; Payment</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1&nbsp;&nbsp;&nbsp;&nbsp;**Purchase Price**. For each Aircraft, the total consideration payable by Buyer to Seller at Delivery shall be equal to the amount set forth in Exhibit A for such Aircraft (for each Item of Equipment, its "**<u>Purchase Price</u>**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Date Payment**. At Delivery Date (unless extended pursuant to Section 5.3(b)) Buyer shall pay Seller the Purchase Price for all Items of Equipment delivered, free and clear of and without any deduction or withholding for or on account of tax.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3&nbsp;&nbsp;&nbsp;&nbsp;**Payment Instructions**.

&nbsp;&nbsp;&nbsp;&nbsp;Seller directs Buyer to pay the Purchase Price for the applicable Item of Equipment due under this Agreement in Dollars by wire transfer of immediately available funds to the account designated by Seller to Buyer in writing at least [\*\*\*] prior to the date such payment is due.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

4.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Aircraft Acceptance</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have access to each Item of Equipment, and all Records, prior to its purchase, at its own cost to verify that each Item of Equipment is in the Delivery Condition immediately prior to Delivery.

5.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Delivery of Item of Equipment</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Condition**. Except as expressly described in this Section 5.1, each Item of Equipment will be delivered in "AS-IS, WHERE-IS" and "WITH ALL FAULTS" condition subject to the following specific conditions being met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Each Item of Equipment shall be in serviceable condition per the GMM and in the same condition, configuration and modification as of the date of this Agreement, ordinary operational wear and tear excepted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;All Records with respect to the applicable Item of Equipment shall be in the English language and shall be in good condition, readable, complete, accurate as to content, and up to date in accordance with FAA requirements and in the same condition as of the date of this Agreement but for such additions as are required to satisfy FAA requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;In the case of an Airframe, such Airframe shall be clean by scheduled passenger airline standards.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;The Aircraft shall have a currently valid US Certificate of Airworthiness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;Each Item of Equipment shall be free and clear of all Liens (other than Buyer's Liens).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Location**. The delivery location (the "**<u>Delivery Location</u>**") for each Item of Equipment shall be at a location designated by Buyer and reasonably acceptable to Seller [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3&nbsp;&nbsp;&nbsp;&nbsp;**Delivery Schedule**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Intentionally Omitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The "**<u>Delivery Window Deadline</u>**" shall mean the date that is [\*\*\*] after the Scheduled Delivery Date or such later date as requested (which request must be made in writing in advance of such deadline) by a Party (if such delay has not been caused by such Party) and consented to by the other Party,

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

which consent may not be unreasonably delayed or withheld; provided that, in no event shall the Delivery Window Deadline be extended more than [\*\*\*] past the Scheduled Delivery Date without the written consent of both parties (such consent may be withheld in each parties' sole discretion).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4&nbsp;&nbsp;&nbsp;&nbsp;**Delivery**. Upon satisfaction or waiver of the conditions precedent for all Items of Equipment set forth in Section 6.1 (other than Excluded Assets), upon Delivery of all such Items of Equipment at the Delivery Location, Buyer shall pay the Purchase Price and deliver an Acceptance Certificate to Seller with respect to each Item of Equipment, and Seller shall execute and concurrently deliver to Buyer the Bill of Sale, whereupon risk of loss to the relevant Item of Equipment shall transfer to Buyer and title to the relevant Item of Equipment shall transfer to Buyer, free and clear of any Liens (other than Buyer's Liens).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5&nbsp;&nbsp;&nbsp;&nbsp;**FAA Documents**. Immediately upon Buyer's provision of a wire transfer number for the wire of the Purchase Price as to such Aircraft, (a) Seller shall instruct FAA Counsel to file the FAA Bill of Sale with the FAA Registry in Oklahoma City, and (ii) Buyer shall instruct FAA Counsel to file the Aircraft Registration Application with the FAA Registry in Oklahoma City. Thereafter, FAA Counsel shall record the contracts of sale for the Airframe and Engines on the International Registry. Prior to the relevant Delivery Date, Seller shall have provided all authorizations necessary for FAA Counsel to effect such registrations on the International Registry.

6.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Conditions Precedent</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1&nbsp;&nbsp;&nbsp;&nbsp;**Conditions Precedent**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Buyer's obligation to purchase an Item of Equipment and Seller's obligation to sell (or to cause to be sold) such Item of Equipment shall be subject to satisfaction (or waiver by the intended beneficiary of the relevant condition precedent) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;a Total Loss shall not have occurred with respect to such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;the representations and warranties made by the other Party in this Agreement shall be true and correct on and as of the Delivery Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;on the Delivery Date, the Item of Equipment shall be located at the Delivery Location;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;receipt of all appropriate governmental or regulatory approvals deemed necessary or advisable by Seller and Buyer;

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;concurrent with the execution and delivery of this Agreement, Buyer shall also have received the executed Share Purchase Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;all of the conditions precedent under the Share Purchase Agreement shall have been satisfied or waived and the Closing (as defined in the Share Purchase Agreement) shall have occurred; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;no change shall have occurred after the date of this Agreement (in any applicable law or otherwise) which would make it illegal for the Buyer or the Seller to perform any of its obligations under the Transaction Documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The obligation of Buyer to purchase an Item of Equipment shall be subject to satisfaction (or waiver by Buyer) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received Transaction Documents for such Item of Equipment to which Seller (or a Seller-Owner) is a party, in each case duly executed and delivered by Seller (or a Seller-Owner);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;such Item of Equipment shall be free and clear of all Liens (but excluding any Buyer's Liens), including any interests on the International Registry, and Buyer shall have received an FAA lien report and priority search certificates from FAA Counsel evidencing the same;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;the applicable Item of Equipment shall meet the Delivery Conditions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received confirmation from FAA Counsel that Seller has (or has caused Seller-Owner to, as applicable) placed in escrow with FAA Counsel the FAA Bill of Sale for such Item of Equipment and provided direction (and any necessary authorizations or consents) to FAA Counsel, upon Delivery and filing of the applicable FAA Bill of Sale, to register a contract of sale for the sale of such Item of Equipment and each associated Engine on the International Registry;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall have received a duly completed and executed IRS Form W-9 from Seller (or a Seller-Owner, as appropriate) and any other appropriate forms or documentation, in each case establishing a complete exemption for any withholding that would otherwise be imposed on any payments made under this Agreement;

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;Buyer shall be satisfied that the sale of all Items of Equipment subject to this Agreement shall close simultaneously;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;No Seller's Default shall be continuing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;Buyer will have a reasonable basis to believe that no Transfer Taxes will be imposed with respect to the sale and purchase of the Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;Buyer and Seller shall have agreed under Section 7.1(b) on the treatment for each Item of Equipment that has suffered the damage specified therein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Seller and the Seller-Owner certifying as to (i) the resolutions of its board of directors (or equivalent managing body), duly adopted and in effect, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of its officers authorized to sign this Agreement and the documents to be delivered hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)&nbsp;&nbsp;&nbsp;&nbsp;copies of back-to-birth bills of sale for each Airframe and Engine and priority search certificates showing the Seller-Owner as the current owner, or Buyer shall otherwise be satisfied in its reasonable discretion that Seller-Owner is the current owner of each Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The obligation of Seller to sell an Item of Equipment shall be subject to satisfaction (or waiver by Seller) of the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall have received Transaction Documents for such Item of Equipment to which Buyer is a party, in each case duly executed and delivered by Buyer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of the full Purchase Price for such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of a duly executed copy from Buyer of the Acceptance Certificate with respect to such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;&nbsp;&nbsp;No Buyer's Default shall be continuing;

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall have received confirmation from FAA Counsel that Buyer has placed in escrow with FAA Counsel the FAA Registration Application and such other documentation required for Buyer to register an Airframe in the United States in the name of the Buyer as owner;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;&nbsp;&nbsp;Seller shall be satisfied that the sale of all Items of Equipment subject to this Agreement shall close simultaneously other than any Excluded Assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;&nbsp;&nbsp;&nbsp;receipt by Seller of certificates from Buyer's insurance broker evidencing Buyer's compliance with the insurance provisions of Section 9 hereof with respect to such Item of Equipment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;&nbsp;&nbsp;&nbsp;concurrent with the execution and delivery of this Agreement, Seller shall also have received the executed Share Purchase Agreement dated the date hereof between Harbor Diversified, Inc. and CSI Aviation, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;&nbsp;&nbsp;Buyer and Seller shall have agreed under Section 7.1(b) on the treatment for each Item of Equipment that has suffered the damage specified therein; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;a certificate of the Secretary or Assistant Secretary (or equivalent officer) of the Buyer certifying as to (i) the resolutions of the board of directors (or equivalent managing body) of the Buyer, duly adopted and in effect, which authorize the execution, delivery, and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of the officers of the buyer authorized to sign this Agreement and the documents to be delivered hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2&nbsp;&nbsp;&nbsp;&nbsp;**No Financing or Other Contingencies**. The transactions contemplated herein shall not be subject to or contingent on Buyer obtaining any financing in relation to its acquisition of any Item of Equipment.

7.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Termination</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1&nbsp;&nbsp;&nbsp;&nbsp;**Total Loss before Delivery; Material Damage before Delivery**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;If any Item of Equipment suffers [\*\*\*] prior to Delivery, Seller shall, [\*\*\*] notify Buyer in writing thereof and the Seller's obligations to sell and the Buyer's obligation to purchase the Item of Equipment shall terminate, a Non-Sale Event shall have occurred and such Item of Equipment shall become an Excluded Asset.

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;If any Item of Equipment suffers damage exceeding [\*\*\*] but less than [\*\*\*] prior to Delivery, Seller shall [\*\*\*] notify Buyer in writing thereof. Following such notice, Buyer and Seller shall determine an appropriate rectification for such damage, before proceeding with the sale of all Items of Equipment hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;If this Agreement is terminated with respect to an Item of Equipment following a Total Loss thereof, then neither Buyer nor Seller shall have any further obligation or liability to the other in respect of the applicable Item of Equipment, and the terms and conditions of the Agreement in respect of such Item of Equipment shall automatically terminate and have no force and effect except for with respect to this subsection, Section 8.4(a) (Limitation of Liability), Section 11.3 (Non-Waiver), Section 11.6 (Governing Law and Jurisdiction), Section 11.10 (Transaction Costs), Section 11.12 (Confidentiality), and Section 11.13 (Third-party Beneficiaries), and in each case of the foregoing any provisions of this Agreement required to give meaning to the aforementioned sections.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2&nbsp;&nbsp;&nbsp;&nbsp;**Default Provisions**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;**Buyer's Default**. If a Buyer's Default should occur then Seller shall be entitled, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;**Seller's Default**. If a Seller's Default should occur then Buyer shall be entitled, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3&nbsp;&nbsp;&nbsp;&nbsp;**Effect of Termination**. Notwithstanding the foregoing, each party hereto may exercise any other right or remedy, if any, which may be available to it under applicable law or the Transaction Documents in respect of such Item of Equipment (if they have been entered into) and each party shall retain any and all claims, if any, for damages under such Transaction Documents (if they have been entered into) or under applicable law for any breach of any agreement, representation, warranty or covenant contained in this Agreement or such Transaction Documents (if they have been entered into).

8.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Representations and Warranties; Disclaimers and Waivers</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1&nbsp;&nbsp;&nbsp;&nbsp;**Seller Representations and Warranties**.

Seller represents and warrants to Buyer that the following statements are as of the date hereof and at each Delivery true and accurate:

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Seller and Seller-Owner are organized and validly existing under the Laws of their jurisdiction of formation and have the power and authority to carry on their business as presently conducted and to perform its obligations under the Transaction Documents to which they are a Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;each of the Transaction Documents to which Seller and Seller-Owner are a Party have been (or will be, when executed) duly authorized, entered into and delivered by them, constitutes the legal, valid and binding obligation enforceable against it in accordance with its terms (subject to bankruptcy, insolvency, reorganization or similar Laws of general application affecting the enforcement of creditors' rights generally);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution and delivery of the Transaction Documents to which Seller or Seller-Owner are a Party, nor the consummation of the transactions contemplated thereby nor compliance by it with any of the terms and provisions thereof will contravene any Law applicable to Seller or Seller-Owner or result in any breach of, or constitute a default under any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, bank loan or credit agreement, partnership agreement, or other agreement or instrument to which Seller or Seller-Owner is a Party or by which it or its properties or assets are bound or affected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution, delivery or performance by Seller or Seller-Owner of the Transaction Documents to which they are a Party, nor the consummation by them of any of the transactions contemplated thereby, will require the consent or approval of, the giving of notice to, or the taking of any other action in respect of, the shareholders, or the trustee or holder of any indebtedness of theirs, except such as have been or will be obtained or effected, each of which approvals, consents and waivers shall be in full force and effect on the Delivery Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;immediately prior to Delivery, Seller-Owner will have full legal and beneficial title in and to the relevant Item of Equipment, free and clear of any Liens over such Item of Equipment other than Buyer's Liens, and at Delivery Seller-Owner shall convey to Buyer good and marketable title to the Item of Equipment free and clear of any Liens (other than Buyer's Liens);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;there are no suits, actions, arbitration proceedings or claims pending or, to the knowledge of Seller, threatened against Seller or Seller-Owner arising out of or in connection with any Item of Equipment or the Transaction Documents before or by any Government Entity or that if adversely determined

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

------

would affect the ability of Seller or Seller-Owner to consummate the transactions contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;Seller and Seller-Owner comply with all applicable anti-money laundering laws, anti-corruption laws and U.S. or other applicable export control and sanctions laws and regulations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;neither Seller nor Seller-Owner is the target of any U.S. or other applicable sanctions or export control restrictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Representations and Warranties**.

Buyer represents and warrants to Seller that the following statements are as of the date hereof and at each Delivery true and accurate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;it is duly organized and validly existing under the Laws of its state of organization and has the power and authority to carry on its business as presently conducted and to perform its obligations under the Transaction Documents to which it is a Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;each of the Transaction Documents to which it is a Party has been (or will be, when executed) duly authorized, entered into and delivered by Buyer and constitutes the legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms (subject to bankruptcy, insolvency, reorganization or similar Laws of general application affecting the enforcement of creditors' rights generally);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution and delivery of the Transaction Documents to which it is a Party, nor the consummation of the transactions contemplated thereby nor compliance by it with any of the terms and provisions thereof will contravene any Law applicable to it or result in any breach of, or constitute a default under any indenture, mortgage, chattel mortgage, deed of trust, conditional sales contract, bank loan or credit agreement, corporate charter or by-laws, or other agreement or instrument to which it is a Party or by which its or its properties or assets are bound or affected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;neither the execution, delivery or performance by it of the Transaction Documents to which it is a Party, nor the consummation by it of any of the transactions contemplated hereby or thereby, will require the consent or approval of, the giving of notice to, or the taking of any other action in respect of, the members, or the trustee or holder of any indebtedness of Buyer, except such as have been or will be obtained or effected, each of which approvals, consents and waivers shall be in full force and effect on the Delivery Date;

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;there are no suits, actions, arbitration proceedings or claims pending or, to the knowledge of Buyer, threatened against Buyer arising out of or in connection with the Transaction Documents before or by any Government Entity or that if adversely determined would affect the ability of Buyer to consummate the transactions contemplated by this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;it complies with all applicable anti-money laundering laws, anti-corruption laws and U.S. or other applicable export control and sanctions laws and regulations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;it is not the target of any U.S. or other applicable sanctions or export control restrictions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3&nbsp;&nbsp;&nbsp;&nbsp;**Disclaimers**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE BILL OF SALE WITH RESPECT TO AN ITEM OF EQUIPMENT, AND WITHOUT LIMITING ANY OF THE RIGHTS OR REMEDIES OF BUYER UNDER THIS AGREEMENT, EACH ITEM OF EQUIPMENT IS BEING SOLD ON ITS RESPECTIVE DELIVERY DATE TO BUYER IN "AS IS", "WHERE IS" AND "WITH ALL FAULTS" CONDITION WITHOUT ANY REPRESENTATION, GUARANTEE OR WARRANTY OF THE SELLER, EXPRESS OR IMPLIED, OF ANY KIND, ARISING BY LAW OR OTHERWISE AS TO THE CONDITION THEREOF; AND

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;WITHOUT LIMITING THE GENERALITY OF SECTION 8.3(a), EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE BILL OF SALE WITH RESPECT TO AN ITEM OF EQUIPEMENT, BUYER UNCONDITIONALLY AGREES THAT EACH ITEM OF EQUIPMENT, AND EACH PART THEREOF ARE TO BE SOLD AND PURCHASED IN AN "AS IS", "WHERE IS" AND "WITH ALL FAULTS" CONDITION AS AT THE RELEVANT DELIVERY DATE APPLICABLE THERETO, AND NO TERM, CONDITION, WARRANTY, REPRESENTATION OR COVENANT OF ANY KIND HAS BEEN ACCEPTED, MADE OR IS GIVEN BY SELLER, IN RESPECT OF THE AIRWORTHINESS, VALUE, QUALITY, DURABILITY, TITLE, CONDITION, DESIGN, OPERATION, DESCRIPTION, MERCHANTABILITY OR FITNESS FOR USE OR PURPOSE OF THE ITEM OF EQUIPMENT, ANY ENGINE OR ANY PART THEREOF, AS TO THE ABSENCE OF LATENT, INHERENT OR OTHER DEFECTS (WHETHER OR NOT DISCOVERABLE), AS TO THE ACCURACY, VALIDITY, TRACEABILITY, COMPLETENESS OR CONDITION OF THE RECORDS, OR AS TO THE ABSENCE OF ANY

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INFRINGEMENT OF ANY PATENT, COPYRIGHT, DESIGN, OR OTHER PROPRIETARY RIGHTS; AND ALL CONDITIONS, WARRANTIES AND REPRESENTATIONS (OR OBLIGATION OR LIABILITY, IN CONTRACT OR IN TORT) IN RELATION TO ANY OF THOSE MATTERS, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, ARE EXPRESSLY EXCLUDED.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;EXECUTION AND DELIVERY OF AN ACCEPTANCE CERTIFICATE BY BUYER TO SELLER SHALL BE CONCLUSIVE PROOF THAT THE APPLICABLE ITEM OF EQUIPMENT AND EACH PART THEREOF DESCRIBED IN SUCH ACCEPTANCE CERTIFICATE ARE AS OF THE DATE OF SUCH EXECUTION AND DELIVERY IN EVERY WAY SATISFACTORY TO BUYER AND HAVE BEEN ACCEPTED BY BUYER FOR ALL PURPOSES OF THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;DISCLAIMER OF APPLICATION OF C.I.S.G. THE PARTIES HEREBY EXPRESSLY DISCLAIM THE APPLICATION OF THE UNITED NATIONS CONVENTION ON THE INTERNATIONAL SALE OF GOODS TO THE EXTENT APPLICABLE TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4&nbsp;&nbsp;&nbsp;&nbsp;**LIMITATION OF LIABILITY; WAIVER**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;BUYER AND SELLER EACH AGREE THAT NEITHER BUYER NOR SELLER SHALL BE ENTITLED TO RECEIVE AND EACH HEREBY DISCLAIMS AND WAIVES ANY RIGHT THAT IT MAY OTHERWISE HAVE TO RECOVER OR SEEK TO RECOVER FROM THE OTHER PARTY PUNITIVE, EXEMPLARY SPECIAL, INDIRECT, REMOTE, SPECULATIVE, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF SALES, LOSS OF REVENUE OR LOSS OF OPPORTUNITY), IN EACH CASE WHETHER IN TORT (INCLUDING NEGLIGENCE OR GROSS NEGLIGENCE), STRICT LIABILITY, BY CONTRACT, STATUTE OR OTHERWISE, RESPECT OF ANY CLAIM MADE UNDER OR IN CONNECTION WITH THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;BUYER HEREBY AGREES THAT ITS ACCEPTANCE OF AN ITEM OF EQUIPMENT AT DELIVERY AND ITS EXECUTION AND DELIVERY OF AN ACCEPTANCE CERTIFICATE IN RESPECT OF EACH ITEM OF EQUIPMENT CONSTITUTE BUYER'S WAIVER OF ANY WARRANTY OF DESCRIPTION, EXPRESS OR IMPLIED, AND ANY CLAIMS BUYER MAY HAVE AGAINST SELLER OR ANY PARTY ACTING FOR OR ON BEHALF OF SELLER BASED UPON THE FAILURE

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OF THE ITEM OF EQUIPMENT TO CONFORM WITH SUCH DESCRIPTION.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;DELIVERY BY BUYER TO SELLER OF AN ACCEPTANCE CERTIFICATE IN RESPECT OF EACH ITEM OF EQUIPMENT WILL BE CONCLUSIVE PROOF AS BETWEEN SELLER, ON THE ONE HAND, AND BUYER, ON THE OTHER HAND, THAT BUYER'S TECHNICAL EXPERTS HAVE EXAMINED AND INVESTIGATED EACH ITEM OF EQUIPMENT (INCLUDING THE ENGINES) AND HAVE UNCONDITIONALLY AND IRREVOCABLY ACCEPTED SUCH ITEM OF EQUIPMENT.

9.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Insurance</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1&nbsp;&nbsp;&nbsp;&nbsp;**Insurances**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;For the period commencing on the Delivery Date for an Item of Equipment and ending on the earlier of (a) the [\*\*\*] of the Delivery Date of such Item of Equipment and (b) the completion of the next "C-check" due under the GMM for such Item of Equipment (the "**<u>Insurance Period</u>**"), Buyer will carry or cause to be carried and maintained, comprehensive airline legal liability insurance, including but not limited to third party, passenger, baggage, cargo, mail and products liability insurance including without limitation, war risk and allied perils, in an amount of not less than [\*\*\*]. Notwithstanding the foregoing, for any period of the Insurance Period that any Item of Equipment is in storage and not being operated, Buyer may maintain (or cause to be maintained) with respect to such Item of Equipment and only for such period of the Insurance Period that such Item of Equipment is in storage and not being operated, comprehensive aviation liability insurance (including, but not limited to, contractual liability and products liability) in an amount not less than [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;All policies carried in accordance with this Section 9.1 and any policies taken out in substitution or replacement for any such policies, (i) shall include the Seller Parties as additional insureds (but not as manufacturer, repairer or servicing agent of the Item of Equipment, and without imposing on any such party liability to pay premiums with respect to such insurance) as respects the operation of the operator, (ii) shall be maintained with insurers of recognized standing and normally participating in the leading international commercial aviation insurance markets (through reinsurance, if necessary), (iii) shall provide that if the insurers cancel such insurance for any reason, or if the same is allowed to lapse for non-payment of premium or if any material change is made in the insurance which adversely affects the interest of the Seller Parties, such lapse, cancellation or change shall not be effective as to the Seller Parties and each of

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them for [\*\*\*] in the case of war risk and allied perils coverage) after written notice by such insurers of such lapse, cancellation or change, provided, however, that if any notice period specified above is not reasonably obtainable, such policies shall provide for as long a period of prior notice as shall then be reasonably obtainable, (iv) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were separate policy covering each insured, (v) provide that the insurers will waive any right to any setoff, recoupment, subrogation or counterclaim or any other deduction, by attachment or otherwise, and (vi) be primary and without right of contribution from any insurance which may be carried by the Seller Parties and any of them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2&nbsp;&nbsp;&nbsp;&nbsp;**Certificates, Etc**. On or before the Delivery Date for each Item of Equipment, Buyer and Seller shall cooperate to cause Buyer to provide to Seller a certificate of insurance evidencing the coverage required pursuant to this Section 9 and Buyer shall provide to Seller, as applicable, an updated certificate of insurance upon each renewal or replacement of the coverage required pursuant to this Section 9. Seller agrees that any insurance certificate issued by Air Wisconsin Airlines LLC for an Item of Equipment during the Insurance Period shall satisfy the requirements of this Section 9 so long as it lists Seller Parties as additional insureds.

10.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Transfer Taxes; Indemnities</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1&nbsp;&nbsp;&nbsp;&nbsp;**Transfer Taxes.** Each Party is responsible for researching its own tax position in relation to the transactions contemplated by the Transaction Documents, at its own cost and for its sole benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;**Tax Indemnity**. Buyer shall, on an after-tax basis, pay, indemnify and hold Seller and its Affiliates harmless from any and all sales, use, transfer, value-added, or other similar taxes, together with any penalties, fines, or interest thereon, imposed, levied, or assessed on or with respect to the sale or Delivery of, or transfer of title to, any Item of Equipment by Seller to Buyer hereunder, other than (i) taxes imposed on or calculated by reference to the net income, profits or gains of Seller; (ii) franchise taxes, commercial activity taxes, (iii) taxes to the extent imposed as result of Seller's failure to comply with the terms of this Agreement; (iv) taxes imposed, levied or assessed to the extent arising out of or in connection with the ownership, import, export, possession, operation, use, maintenance, return, or storage of the Item of Equipment prior to the Delivery, except any sales, use, transfer, excise, value-added, or other similar taxes on or with respect to the sale or Delivery of, or transfer of title to, the Item of Equipment by Seller to Buyer hereunder, and (v) taxes to the extent arising as a result of the gross negligence or willful misconduct of Seller or any of its

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Affiliates or resulting from any inaccuracy of any representation or warranty of Seller hereunder (any or all of the foregoing, "**<u>Transfer Taxes</u>**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;**Cooperation**. The Parties shall reasonably cooperate with one another to deliver to each other such certifications and other documents as may be reasonably requested in order to avail of any applicable exemption from Transfer Taxes. Without limiting the foregoing, at or prior to the Delivery of each Item of Equipment, Buyer shall either (i) pay any Transfer Taxes imposed, levied, or assessed on or with respect to the sale or Delivery of, or transfer of title to, such Item of Equipment or (ii) provide to Seller a duly completed and validly executed exemption certificate, resale certificate, or other documentation reasonably satisfactory to Seller establishing a complete exemption from Transfer Taxes with respect to the sale or Delivery of, or transfer of title to, such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;**Seller Indemnities.** Subject to the other terms and conditions of this Section 10.2, Seller shall defend, indemnify, and hold harmless the Buyer and its respective shareholders, members, directors, managers, officers, and employees from and against [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3&nbsp;&nbsp;&nbsp;&nbsp;**Buyer Indemnities.** Subject to the other terms and conditions of this Section 10.3 the Buyer shall defend, indemnify, and hold harmless the Seller and its respective members, managers, directors, officers, and employees from and against [\*\*\*].

11.&nbsp;&nbsp;&nbsp;&nbsp;**<u>Miscellaneous</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1&nbsp;&nbsp;&nbsp;&nbsp;**Entire Agreement, Amendment, and Installment Contract**. Except as expressly provided herein, this Agreement together with the other Transaction Documents constitutes the entire agreement among the parties relating to the subject matter hereof and thereof and supersedes any and all previous agreements and understandings, oral or written, relating to the subject matter hereof and thereof. In the event of any conflict between any term or provision in any of this Agreement or any other Transaction Document and any term or provision in any term sheet, the terms and provisions of this Agreement or such any other Transaction Document shall control and govern. This Agreement may not be amended except by an instrument in writing signed by or on behalf of each Party. The Parties acknowledge and agree that this Agreement is an installment contract, and accordingly (except in connection with a termination of this Agreement pursuant to Section 7.3), the inability or failure of the Delivery of any Item of Equipment, will not relieve the obligation of the Seller to sell, and the Buyer to buy, the remaining Items of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2&nbsp;&nbsp;&nbsp;&nbsp;**Time of the Essence to Complete Purchase of Item of Equipment**. The Parties agree that time shall be of the essence of this Agreement with respect to closing

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and delivering every Item of Equipment by the Delivery Window Deadline. Additionally, each of the Parties shall act in a commercially reasonable manner to effect the transactions contemplated under this Agreement in a prompt manner and in accordance with the time periods and deadlines provided herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3&nbsp;&nbsp;&nbsp;&nbsp;**Non-Waiver**. Any of the terms, covenants, or conditions hereof may be waived only by a written instrument executed by or on behalf of the Party hereto waiving compliance. No course of dealing on the part of any Party hereto, or its respective officers, employees, agents, accountants, attorneys, investment bankers, consultants, or other authorized representatives, nor any failure by a Party hereto to exercise any of its rights under this Agreement shall operate as a waiver thereof or affect in any way the right of such Party at a later time to enforce the performance of such provision. No waiver by any Party hereto of any condition, or any breach of any term or covenant contained in this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term or covenant. Except as otherwise provided in this Agreement, the rights of the Parties hereto under this Agreement shall be cumulative, and the exercise or partial exercise of any such right shall not preclude the exercise of any other right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4&nbsp;&nbsp;&nbsp;&nbsp;**Severability**. In the event that any provision of this Agreement or the application thereof to any Party shall, to any extent, be invalid or unenforceable under any applicable Law, then such provision shall be deemed inoperative to the extent that it is invalid or unenforceable and the remainder of this Agreement, and the application of any such invalid or unenforceable provision to the Parties, jurisdictions or circumstances other than to whom or to which it is held invalid or unenforceable, shall not be affected thereby nor shall the same affect the validity or enforceability of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.5&nbsp;&nbsp;&nbsp;&nbsp;**Notices**. Any notice, request or information required or permissible under this Agreement will be in writing and in the English language. Notices must be addressed to the Parties as set forth below and delivered in person or sent by electronic mail or by expedited delivery, with a copy sent by e-mail. Any such notice shall be effective when received. In the case of a notice sent by expedited delivery, notice will be deemed received on the date of delivery set forth in the records of the Person which accomplished the delivery. If any notice is sent by more than one of the above listed methods, notice will be deemed received on the earliest possible date in accordance with the above provisions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Seller:

Harbor Diversified, Inc.

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W6390 Challenger Drive, Suite 203

Appleton, WI 54914

Attention: [\*\*\*]

Telephone: [\*\*\*]

E mail: [\*\*\*]

Attention: [\*\*\*]

Telephone: [\*\*\*]

E mail: [\*\*\*]

(with copies to [\*\*\*])

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Buyer:

Associated Energy Group LLC

701 Waterford Way

Suite 490, Miami, FL 33126

Attention: Legal Department

Telephone: [\*\*\*]

Email: [\*\*\*]

(with copies to [\*\*\*])

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.6&nbsp;&nbsp;&nbsp;&nbsp;**Governing Law and Jurisdiction**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;This Agreement, the Transaction Documents, and all ancillary agreements and documents relating hereto, shall be governed by and construed in accordance with the Laws of the State of New York, including all matters of construction, validity, and performance, without reference to principles of conflicts of Law other than sections 5-1401 and 5-1402 of the New York general obligations Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Each of the Parties irrevocably submits itself to the non-exclusive jurisdiction of the courts of the State of New York sitting in the City and County of New York and to the non-exclusive jurisdiction of the U.S. District Court for the Southern District of New York located in the Borough of Manhattan to settle any dispute or claim that arises out of or in connection with this Agreement (including any non-contractual disputes or claims in connection herewith or therewith).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Each party hereto waives objection to such courts on the grounds of inconvenient forum, venue or otherwise as regards proceedings in connection with this Agreement and other documents related hereto and agrees that (subject to permitted appeals) a judgment or order of such a court in connection with this

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Agreement or the other documents related hereto is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.7&nbsp;&nbsp;&nbsp;&nbsp;**Waiver of Jury Trial**. Each Party, to the extent permitted by Law, knowingly, voluntarily, and intentionally waives its right to a trial by jury in any action or other legal proceeding for matters, contractual, tortious, or otherwise, arising out of or relating to this Agreement and the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.8&nbsp;&nbsp;&nbsp;&nbsp;**Further Assurances**. Each Party hereto will promptly and duly execute and deliver such further documents to make such further assurances for and take such further action reasonably requested by any Party to whom such first Party is obligated, all as may be reasonably necessary to carry out more effectively the intent and purpose of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.9&nbsp;&nbsp;&nbsp;&nbsp;**Counterparts**. This Agreement may be executed in any number of counterparts and by any Party hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which, when taken together, shall constitute one and the same agreement. Counterparts may be delivered via electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.10&nbsp;&nbsp;&nbsp;&nbsp;**Transaction Costs**. Each Party shall bear its own costs and expenses (including attorney's fees) in relation to the negotiation and documentation of, and consummation of the transactions contemplated by this Agreement, and any other ancillary documents or agreement and the transactions contemplated hereby and thereby. In respect of the sale of each Item of Equipment, Seller and Buyer will share equally in the costs of FAA Counsel in the filing and registration of the sale of the Item of Equipment on the FAA's Civil Aviation Registry and on the International Registry, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.11&nbsp;&nbsp;&nbsp;&nbsp;**Assignment, Successors and Assigns**. Except as expressly provided in Section 2.3, neither Seller nor Buyer shall assign or transfer all or any of its rights and/or obligations under this Agreement without the prior written consent of the other Party, which may be withheld, conditioned, or delayed in such other Party's sole and absolute discretion; provided that, no assignment will relieve the assigning Party of any of its rights or obligations. This Agreement shall bind and inure to the benefit of the Parties and any successors, and in each case permitted hereunder, assigns to the original Parties to this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.12&nbsp;&nbsp;&nbsp;&nbsp;**Confidentiality**. The terms and conditions of this Agreement are available only to Buyer and Seller and, in signing this Agreement, Buyer and Seller each acknowledge and agree that the terms and existence of this Agreement represent non-public, confidential and proprietary information ("**<u>Confidential Information</u>**"). Each party (including their respective officers, directors, employees, agents and advisers) agrees that it will not disclose Confidential Information to any third party; provided, however, that the Parties may disclose the Confidential Information (i) to their and their affiliates' officers, directors, members, managers, employees, attorneys, accountants, consultants, shareholders and advisors (collectively, "**<u>Representatives</u>**") who need to know such information for the purpose of discussing and/or evaluating the transaction contemplated hereby and who agree not to disclose the Confidential Information, (ii) to any actual or potential participant, assignee or lender of Buyer (or any of their respective Representatives) who need to know such information for the purpose of discussing and/or evaluating such participation, assignment or financing, as the case may be, and who agree not to disclose the Confidential Information, (iii) solely with respect to the identity of the Item of Equipment (and component engines, components, parts, systems and other equipment) and the technical specifications and delivery dates of such, to potential lessees or of other customers of Buyer (and their respective Representatives) of any of the Item of Equipment or equipment, and (iv) as requested or required in connection with a judicial, administrative or regulatory proceeding in which it or a partner, officer, director, member, manager, employee or affiliate is involved, pursuant to a court order or subpoena by a regulatory or government inquiry or demand, or as otherwise required by applicable law or regulation, including stock exchange rules. Notwithstanding the foregoing, the parties and their Affiliates may make any disclosure and filings in connection with any securities filing or other filings required the Securities and Exchange Commission as advised by legal counsel without requiring consent of the other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.13&nbsp;&nbsp;&nbsp;&nbsp;**Third-party Beneficiaries**. Except as provided in Section 9 and 10, this Agreement is not intended to and shall not provide any Person not a Party hereto with any rights, of any nature whatsoever, against any of the Parties hereto, and no Person or entity not a Party hereto shall have any right, power, privilege, benefit, or interest arising out of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.14&nbsp;&nbsp;&nbsp;&nbsp;**[Intentionally Omitted]**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.15&nbsp;&nbsp;&nbsp;&nbsp;**Force Majeure**. Neither party shall be liable for any failure of or delay in the Delivery of an Item of Equipment, or in any other obligation hereunder for the period that such failure or delay is due to acts of God or the public enemy; war, insurrection or riots; fires, governmental actions; strikes or labor disputes; pandemic, epidemic, or quarantine mandate; inability to obtain materials, accessories, or parts from the vendors;

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or any other cause beyond such parties' reasonable control. Upon the occurrence of any such event, the time required for performance by such party of its obligations arising under this Agreement shall be extended by a period equal to the duration of such event. In the event that such extension continues for more than [\*\*\*], then either Party may terminate this Agreement in respect of the purchase and sale of the Item of Equipment subject to such delay, and an Item of Equipment Non-Sale Event shall be deemed to have occurred with respect to such Item of Equipment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.16&nbsp;&nbsp;&nbsp;&nbsp;**Publicity**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Neither Party will issue any press release or make any public announcement relating to the subject matter of this Agreement without the prior written approval of the other Party, except that either Party may make any public disclosure it believes in good faith is required by applicable Law or stock exchange rules. Notwithstanding the foregoing, if either Party, or a third party, makes a public disclosure related to this Agreement that is false or damaging to a Party, the aggrieved Party will have the right to make a public response reasonably necessary to correct any misstatement, inaccuracies or material omissions in the initial and wrongful affirmative disclosure without prior approval of the other Party. Neither Party will be required to obtain consent pursuant to this section for any proposed release or announcement that is consistent with information that has previously been made public without breach of its obligations under this clause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;Neither Party will, without the other Party's prior written consent in each instance (x) use in advertising, publicity or marketing communications of any kind the name or other trademarks of the other Party or any of its Affiliates, or any employee of either, or (y) represent, directly or indirectly, that any product or service provided by a Party has been approved or endorsed by the other Party or any of its Affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.17&nbsp;&nbsp;&nbsp;&nbsp;**Relationship of the Parties**. Nothing contained in this Agreement shall be deemed to create an association, partnership, joint venture, or relationship of principal and agent or master and servant between the Parties, or to grant either Party the right or authority to assume, create or incur any liability or obligation of any kind, express or implied, against, in the name of, or on behalf of, the other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.18&nbsp;&nbsp;&nbsp;&nbsp;**Brokers and other Third Parties**.Each Party represents and warrants to the other that it has not paid, agreed to pay or caused to be paid directly or indirectly in any form, any commission, percentage, contingent fee, brokerage or other similar payments of any kind in connection with this Agreement or the transactions contemplated hereby, to any Person. Each Party agrees to indemnify and hold the other harmless from

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

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and against any and all claims, suits, damages, costs and expenses (including, but not limited to reasonable attorneys' fees and costs) asserted by any agent, broker or other third party for any commission or compensation of any nature whatsoever based upon this Agreement or the Transaction Documents or any Item of Equipment.

<br>[SIGNATURE PAGE FOLLOWS]

[\*\*\*] = CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED

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IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement as of the day and year first above written.

<u>SELLER</u>:

HARBOR DIVERSIFIED, INC.

By:&nbsp;&nbsp;&nbsp;&nbsp;*<u>/s/ Christine R. Deister</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>

Name: <u>Christine R. Deister&nbsp;&nbsp;&nbsp;&nbsp;</u>

Title:&nbsp;&nbsp;&nbsp;&nbsp;<u>Chief Executive Officer and Secretary</u>

<u>BUYER</u>:

ASSOCIATED ENERGY GROUP LLC

By:&nbsp;&nbsp;&nbsp;&nbsp;*<u>/s/ Chris Clementi</u>*<u>&nbsp;&nbsp;&nbsp;&nbsp;</u>

Name: <u>Chris Clementi&nbsp;&nbsp;&nbsp;&nbsp;</u>

Title:&nbsp;&nbsp;&nbsp;&nbsp;<u>CEO&nbsp;&nbsp;&nbsp;&nbsp;</u>

Signature Page

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

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**<u>Exhibit A</u>**

**DESCRIPTION OF AIRCRAFT AND ENGINES**

[\*\*\*]

Exhibit A

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

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**<u>Exhibit B<br></u>**<br> <u>FORM OF ACCEPTANCE CERTIFICATE</u>

[\*\*\*] <br>

Exhibit B

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

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**<u>Exhibit C<br></u>**<br> <u>FORM OF WARRANTY BILL OF SALE<br></u><br> **WARRANTY BILL OF SALE**

[\*\*\*]

Exhibit C

[\*\*\*]=[CONFIDENTIAL PORTION HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IF PUBLICLY DISCLOSED]

## Exhibit 21.1

**Exhibit 21.1**

**LIST OF SUBSIDIARIES**<sup>(1)(2)</sup>

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| | | |
|:---|:---|:---|
| **NAME OF SUBSIDIARY** | **STATE OF FORMATION**<br>**OR INCORPORATION** | **OWNERSHIP PERCENTAGE** |
| Lotus Aviation Leasing, LLC | Delaware | 100% |
| Air Wisconsin Funding LLC | Delaware | 100% |
| Harbor Therapeutics, Inc. | Delaware | 100% |
| AWAC Aviation, Inc. ("AWAC") | Delaware | 100% |

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<sup>(1)</sup> The table provides information regarding the subsidiaries of Harbor as of the date on which the Annual Report was filed.

<sup>(2)</sup> On January 9, 2026, in connection with completion of the Aviation Disposition, AWAC agreed to sell all of the membership interests in Air Wisconsin Airlines LLC, which was a wholly owned subsidiary of AWAC prior to the transaction.

## Exhibit 31.1

**Exhibit 31.1** 

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER** 

**PURSUANT TO RULES 13a-14(a)** 

**OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,** 

**AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002** 

I, Christine R. Deister, certify that:

1. I have reviewed this annual report on Form 10-K of Harbor Diversified, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: April 8, 2026 | /s/ Christine R. Deister |
| | Christine R. Deister |
| | Chief Executive Officer and Secretary |
| | Harbor Diversified, Inc. |
| | (*Principal Executive Officer*) |

---

## Exhibit 31.2

**Exhibit 31.2** 

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER** 

**PURSUANT TO RULES 13a-14(a)** 

**OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,** 

**AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002** 

I, Gregg Garvey, certify that:

1. I have reviewed this annual report on Form 10-K of Harbor Diversified, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: April 8, 2026 | /s/ Gregg Garvey |
| | Gregg Garvey |
| | Executive Vice President and Chief Financial Officer |
| | Harbor Diversified, Inc. |
| | (*Principal Financial and Accounting Officer*) |

---

## Exhibit 32.1

**Exhibit 32.1** 

**CERTIFICATIONS PURSUANT TO** 

**18 U.S.C. SECTION 1350,** 

**AS ADOPTED PURSUANT TO** 

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002** 

The following certifications are hereby made in connection with the Annual Report on Form 10-K of Harbor Diversified, Inc. (the "Company") for the period ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the "Report"):

I, Christine R. Deister, Principal Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, (i) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and (ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Date: April 8, 2026 | By: | /s/ Christine R. Deister |
|  |  | Christine R. Deister |
|  |  | Chief Executive Officer and Secretary |
|  |  | Harbor Diversified, Inc. |
|  |  | (*Principal Executive Officer*) |

---

I, Gregg Garvey, Principal Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, (i) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and (ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Date: April 8, 2026 | By: | /s/ Gregg Garvey |
|  |  | Gregg Garvey |
|  |  | Executive Vice President and Chief Financial Officer |
|  |  | Harbor Diversified, Inc. |
|  |  | (*Principal Financial and Accounting Officer*) |

---

<br>