Document:

ex_129469.htm

Exhibit 10.13

 

AMENDMENT NO. 2 TO CREDIT AGREEMENT

 

This AMENDMENT NO. 2 TO CREDIT AGREEMENT dated as of November 12, 2018 (the “Amendment”), between Air T, Inc., a Delaware corporation (the “Borrower”), and Minnesota Bank & Trust, a Minnesota state banking corporation (the “Lender”).

 

RECITALS:

 

A.       The Borrower and the Lender are parties to that certain Credit Agreement dated as of December 21, 2017, as amended by that certain Amendment No. 1 to Credit Agreement dated as of February 15, 2018 (as so amended, the “Original Agreement”).

 

B.        The Borrower has requested that the Lender amend the Original Agreement to increase the Revolving Credit Commitment defined therein.

 

C.        Subject to the terms and conditions of this Amendment, the Lender will agree to the foregoing request of the Borrower.

 

NOW, THEREFORE, the parties agree as follows:

 

1.        Defined Terms. All capitalized terms used in this Amendment shall, except where the context otherwise requires, have the meanings set forth in the Original Agreement as amended hereby.

 

2.        Amendments. The Original Agreement is hereby amended as follows:

 

(a)     The definition of the term “Revolving Credit Commitment” defined in Section 1.01 of the Original Agreement is hereby amended in its entirety to read as follows:

 

“     ‘“Revolving Credit Commitment’: means the obligation of the Lender to make Revolving Credit Loans in an aggregate principal amount not to exceed the sum of (a) $13,000,000, minus (b) the outstanding principal balance of Term Loan C, as the same may be changed from time to time pursuant to the terms hereof.”

 

(b)     The form of Borrowing Base Certificate attached as Exhibit G to the Original Agreement is hereby amended in its entirety to the form of Borrowing Base Certificate (Amended 11/2018) attached as Exhibit G to this Amendment.

 

3.       Conditions to Effectiveness. This Amendment shall become effective on the date (the “Effective Date”) when, and only when, the Lender shall have received:

 

(a)     this Amendment, duly executed by the Borrower;

 

(b)     an Amended and Restated Revolving Credit Note (the “A&R Revolving Credit Note”), in the form provided by Lender, duly executed by Borrower;

 

 

 

 

(c)     an Acknowledgment and Agreement, in the form provided by the Lender, duly executed by each Guarantor; and

 

(d)     such other documents as the Lender may reasonably request.

 

4.        Representations and Warranties. To induce the Lender to enter into this Amendment, the Borrower represents and warrants to the Lender as follows:

 

(a)     The execution, delivery and performance by the Borrower of this Amendment, the A&R Revolving Credit Note, and any other Loan Document to which the Borrower is a party have been duly authorized by all necessary corporate action, do not require any approval or consent of, or any registration, qualification or filing with, any government agency or authority or any approval or consent of any other person (including, without limitation, any shareholder), do not and will not conflict with, result in any violation of or constitute any default under, any provision of the Borrower’s articles of incorporation or bylaws, any agreement binding on or applicable to the Borrower or any of its property, or any law or governmental regulation or court decree or order, binding upon or applicable to the Borrower or of any of its property and will not result in the creation or imposition of any security interest or other lien or encumbrance in or on any of its property pursuant to the provisions of any agreement applicable to the Borrower or any of its property;

 

(b)     The representations and warranties contained in the Original Agreement are true and correct as of the date hereof as though made on that date except: (i) to the extent that such representations and warranties relate solely to an earlier date; and (ii) that the representations and warranties set forth in Section 5.04 of the Original Agreement to the audited annual financial statements and internally-prepared interim financial statements of the Borrower shall be deemed to be a reference to the audited financial statements and interim financial statements, as the case may be, of the Borrower most recently delivered to the Lender pursuant to Section 6.01(a) or 6.01(b) of the Original Agreement;

 

(c)     No events have taken place and no circumstances exist at the date hereof which would give the Borrower the right to assert a defense, offset or counterclaim to any claim by the Lender for payment of the Obligations;

 

(d)     The Original Agreement, as amended by this Amendment, the A&R Revolving Credit Note, and each other Loan Document to which the Borrower is a party are the legal, valid and binding obligations of the Borrower and are enforceable in accordance with their respective terms, subject only to bankruptcy, insolvency, reorganization, moratorium or similar laws, rulings or decisions at the time in effect affecting the enforceability of rights of creditors generally and to general equitable principles which may limit the right to obtain equitable remedies; and

 

(e)     Before and after giving effect to this Amendment, there does not exist any Default or Event of Default.

 

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5.      Release. The Borrower hereby releases and forever discharges the Lender and its successors, assigns, directors, officers, agents, employees and participants from any and all actions, causes of action, suits, proceedings, debts, sums of money, covenants, contracts, controversies, claims and demands, at law or in equity, which the Borrower ever had or now has against the Lender or its successors, assigns, directors, officers, agents, employees or participants by virtue of the Lender’s relationship to the Borrower in connection with the Loan Documents and the transactions related thereto

 

6.        Reference to and Effect on the Loan Documents.

 

(a)      From and after the date of this Amendment, each reference in:

 

(i)     the Original Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like import referring to the Original Agreement, and each reference to the “Credit Agreement”, the “Credit Agreement”, “thereunder”, “thereof”, “therein” or words of like import referring to the Original Agreement in any other Loan Document shall mean and be a reference to the Original Agreement as amended hereby; and except as specifically set forth above, the Original Agreement remains in full force and effect and is hereby ratified and confirmed; and

 

(ii)     any Loan Document to the “Revolving Credit Note”, “thereunder”, “thereof”, “therein” or words of like import referring to the Revolving Credit Note shall mean and be a reference to the A&R Revolving Credit Note executed and delivered pursuant to this letter amendment.

 

(b)     The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lender under the Agreement or any other Loan Document, nor constitute a waiver of any provision of the Agreement or any such other Loan Document.

 

7.        Costs, Expenses and Taxes. The Borrower agrees to pay on demand all costs and expenses of the Lender in connection with the preparation, reproduction, execution and delivery of this Amendment and the other documents to be delivered hereunder or thereunder, including their reasonable attorneys’ fees and legal expenses. In addition, the Borrower shall pay any and all stamp and other taxes and fees payable or determined to be payable in connection with the execution and delivery, filing or recording of this Amendment and the other instruments and documents to be delivered hereunder and agrees to save the Lender harmless from and against any and all liabilities with respect to, or resulting from, any delay in the Borrower’s paying or omission to pay, such taxes or fees.

 

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

 

9.        Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

 

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10.      Counterparts. This Amendment may be executed in counterparts and by separate parties in separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same document. Receipt by telecopy, pdf file or other electronic means of any executed signature page to this Amendment shall constitute effective delivery of such signature page.

 

11.       Recitals. The Recitals hereto are incorporated herein by reference and constitute a part of this Amendment.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date first above.

 

	
			 

				
			AIR T, INC.

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				/s/                                                             	
			 

			
	 	Name:	Brett Reynolds	 
	 	Its:	Chief Financial Officer	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	Minnesota Bank & Trust	 
	 	 	 	 
	 	By:	/s/                                                             	 
	 	Name:	Eric P. Gundersen	 
	 	Title:	Senior Vice President	 

 

[signature page Amendment No. 1 to Credit Agreement]

 

 

EXHIBIT G

Form of Borrowing Base Certificate

(Amended 11/2018)

Minnesota Bank & Trust

7701 France Avenue South, Ste. 110

Edina, MN 55435

Attention: Mr. Eric P. Gundersen, SVP

 

	Computed as of: _______________________	Report Number: _______

               

The undersigned is the Borrower under that certain Loan Agreement, dated as of December 21, 2017 (such Loan Agreement, as amended to date and as it may be further amended, modified, supplemented or restated from time to time being the “Loan Agreement”; capitalized terms not otherwise defined herein being used as therein defined) between AIR T, INC. (the “Borrower”) and MINNESOTA BANK & TRUST (the “Lender”).

 

The Borrower hereby reaffirms all representations and warranties to the Loan Agreement and certifies and warrants that the Borrower and the other Loan Parties hold, subject to the security interest of the Lender under the Agreement, and the other Loan Documents, the following Collateral computed on a consolidated basis as of _____________ __, 201_.

 

A.          ACCOUNTS RECEIVABLE

 

	
			1.    Accounts Receivable Balance as of period ending above

				
			 

				
			 

			$_____________

			
	
			2.    Less: Ineligible Accounts

				 	 
	
			a.    Receivables over 120 days past invoice date

				
			 

			$_____________

				 
	
			b.    10% redline rule

				$_____________	 
	
			c.    Insolvent

				$_____________	 
	
			d.    Foreign

				$_____________	 
	
			e.    Affiliated

				$_____________	 
	
			f.    Contras

				$_____________	 
	
			g.    U.S. Government

				$_____________	 
	
			h.    Bonded

				$_____________	 
	
			i.    State, county, municipality

				$_____________	 
	
			j.    Customer deposits

				$_____________	 
	
			k.    Excess of concentration limit for account debtor

				
			$_____________

				 
	
			l.    Other miscellaneous

				
			$___________  _

				 
	
			3.    TOTAL Ineligibles

				 	
			($__________)

			
	
			4.    Total Eligible Accounts (Line A.1 – Line A.3)

				
			 

				
			 

			$___________

			
	
			5.    Eligible Accounts Loan Value at 75% of Line A.4.

				 	
			 

			$___________

			

 

 

 

 

B.          INVENTORY Report dated                                                                 (see attached)

 

	
			1.    Raw Materials and Finished Goods Inventory

				 	$_______________
	
			2.    Less:

				 	 
	
			a.    Discontinued

				
			$_______________

				 
	
			b.    Stored at a location w/out appropriate landlord/bailee/warehouseman’s waiver

				
			$_______________

				 
	
			c.    Consigned to a Loan Party

				 	 
	
			d.    Inventory consigned by a Loan Party that does not comply with all Consigned Inventory Requirements

				
			$_______________

				 
	
			3.    Total Ineligibles

				 	$_______________
	
			4.    Total Eligible Inventory

			(Line B.1-Line B.3)

				
			 

				
			 

			$_______  _______

			
	
			5.    Eligible Inventory Loan Value @ 50% of Line B.4

				 	
			 

			$____ __ ________

			
	
			 

			 

				 	 
	
			 

			C.       Borrowing Base: 

			1.    (Line A.4 + Line B.5)

				 	
			 

			 

			$_________ ____ _

			
	
			 

			 

				 	 
	
			D.       Availability/Amount to be Repaid:

				 	 
	
			 

			1.    Total Usage (Outstanding principal balance of Revolving Loans + Letter of Credit Obligations)

				
			 

			$_______________

				 
	
			 

			2.    Revolving Credit Commitment ($13,000,000 – outstanding principal balance of Term Loan C)

				
			 

			$_______________

				 
	
			 

			3.    Borrowing Base (Line C.1.)

				 	 
	
			 

			4A. Availability (Amount by which the lesser of [Line D.1 and Line D.3] exceeds Line D.1)

				 	
			 

			$_______________

			
	
			 

			4B. Amount to be repaid (Amount by which Line D.1 exceeds the lesser of [Line D.1 and Line D.3] exceeds Line D.1)

				 	
			 

			$_______________

			

 

 

 

 

The Borrower further certifies and warrants that no Event of Default is existing as of the date hereof and, to the best knowledge and belief of the officer of the Borrower executing this Borrowing Base Certificate, there has not been (except as may otherwise indicated below) any change to the information set forth above since the computation date specified above which would materially reduce the amounts shown if such amounts were computed as of the date of this Borrowing Base Certificate and all of the information provided on: (a) the Inventory report attached as Schedule A to this Borrowing Base Certificate and (b) the Other Investments report attached as Schedule B to this Borrower Base Certificate, is true and correct as of the date hereof.

 

 

AIR T, INC.

 

	 	By          __________________      	Title:              _______________________       	Date: ______________, 201___

         

 

 

 

ACKNOWLEDGMENT AND AGREEMENT

 

 

Each of the undersigned has guaranteed payment and performance of the obligations of AIR T, INC., a Delaware corporation (the “Borrower”), to MINNESOTA BANK & TRUST, a Minnesota state banking corporation (the “Lender”), pursuant to the terms of a Guaranty dated as of December 21, 2017 (the “Guaranty”) jointly and severally made by the undersigned in favor of the Lender, which Obligations include, without limitation, all “Obligations” (as defined in the Original Agreement described below) of the Borrower to the Lender pursuant to that certain Credit Agreement dated as of December 21, 2017, , as amended by that certain Amendment No. 1 to Credit Agreement dated as of February 15, 2018 (such Credit Agreement, as so amended, is referred to herein the “Original Agreement”), between the Borrower and the Lender.

 

Each of the undersigned acknowledges that it has received a copy of the proposed Amendment No. 2 to Credit Agreement dated to be effective as of November __, 2018 (the “Amendment”) amending the Original Agreement. Each of the undersigned agrees and acknowledges that the Amendment shall not impair or limit the rights of the Lender under the Guaranty and confirms that: (a) the Guaranty remains in full force and effect, enforceable against such undersigned in accordance with its terms; and (b) by the Guaranty, such undersigned continues to guaranty the payment and performance of the “Obligations” described therein.

 

Each of the undersigned agrees that each reference to the “Credit Agreement”, the “Loan Agreement”, “therein”, “thereof”, “thereby” or words of similar effect referring to the Credit Agreement in any Loan Document to which such undersigned is a party shall mean and be a reference to the Original Agreement, as amended by the Amendment.

 

Each of the undersigned: (a) represents and warrants to the Lender that no events have taken place and no circumstances exist at the date hereof which would give such undersigned the right to assert a defense, offset or counterclaim to any claim by the Lender for payment of the obligations guaranteed by such undersigned or for the enforcement of the Guaranty; and (b) hereby releases and forever discharges the Lender and its successors, assigns, directors, officers, agents, employees and participants from any and all actions, causes of action, suits, proceedings, debts, sums of money, covenants, contracts, controversies, claims and demands, at law or in equity, which such undersigned ever had or now has against the Lender or its successors, assigns, directors, officers, agents, employees or participants by virtue of their relationship to Borrower or any of the undersigned in connection with the Loan Documents and the transactions related thereto.

 

Nothing in this Acknowledgment and Agreement requires the Lender to obtain the consent of any of the undersigned to any future amendment, modification or waiver to the Original Agreement, as amended by the Amendment, or any other Loan Document to which such undersigned is a party except as expressly required by the terms of the Loan Documents to which such undersigned is a party.

 

 

 

 

This Acknowledgment and Agreement may be executed in counterparts and by separate parties in separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same document. The delivery of a facsimile, pdf or other digital copy of an executed counterpart of this Amendment and Agreement shall be deemed to be valid execution and delivery of this Amendment and Agreement.

 

[SIGNATURE PAGES FOLLOW]

 

 

 

 

Dated to be effective as of November __, 2018.

 

 

	
			 

				
			AIRCO, LLC

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By:

				
			/s/                                                

				
			 

			
	
			 

				
			Name:   Candice L. Otey

				
			 

			
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	CSA AIR, INC.	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	GLOBAL AVIATION SERVICES, LLC	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	GLOBAL GROUND SUPPORT, INC.	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	JET YARD, LLC	 
	 	 	 
	 	By: Stratus Aero Partners, LLC	 
	 	Its:  Sole Member	 
	 	 	 
	 	By:	/s/                                         	 
	 	Name:   Candice L. Otey	 
	
			 

				
			Title:     Secretary

				
			 

			

 

[Guarantor Acknowledgment and Agreement Signature Page]

 

 

 

	
			 

				
			MOUNTAIN AIR CARGO, INC.

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				
			/s/                                                

				
			 

			
	
			 

				
			Name:   Candice L. Otey

				
			 

			
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	STRATUS AERO PARTNERS, LLC	 
	 	 	 
	
			 

				
			By:

				
			/s/                                                

				
			 

			
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	AIR T GLOBAL LEASING, LLC	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	AIRCO SERVICES, LLC	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 
	 	 	 
	 	 	 
	 	 	 
	 	SPACE AGE INSURANCE COMPANY	 
	 	 	 
	 	By:	/s/                                                	 
	 	Name:   Candice L. Otey	 
	 	Title:     Secretary	 

 

[Guarantor Acknowledgment and Agreement Signature Page]ex_129470.htm

Exhibit 10.14

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

 

 

	U.S. $13,000,000.00  	Dated as of November 12, 2018
	 	Edina, Minnesota

 

 

FOR VALUE RECEIVED, on the Revolving Credit Termination Date (as defined in the Credit Agreement hereinafter defined) the undersigned, AIR T, INC., a Delaware corporation (the “Borrower”), promises to pay to the order of Minnesota Bank & Trust, a Minnesota state banking corporation (the “Lender”), the principal sum of THIRTEEN MILLION AND NO/100THS DOLLARS (U.S. $13,000,000.00) or, if less, the aggregate unpaid principal amount of all Revolving Credit Loans (as hereinafter defined) made by the Lender to the Borrower pursuant to the Credit Agreement.

 

Interest. The Borrower promises to pay interest on the unpaid principal amount hereof from the date hereof until such principal amount is paid in full at a fluctuating annual rate of interest equal to the greater of (a) 3.25% or (b) the sum of (i) the Prime Rate (hereinafter defined), as in effect on the date hereof and as the same may adjust from time to time, minus (ii) 1.00%. Interest accrued during each calendar month shall be due and payable on the first day of the following calendar month, with the first such interest payment due on December 1, 2018. Interest shall also be payable at maturity and interest accrued after maturity shall be payable on demand. The term “Prime Rate” shall mean the prime rate published in the money rates section of the Wall Street Journal, floating, and changing with each change of such published rate, or if the Wall Street Journal ceases to publish such rate, as published in the Federal Reserve Board’s Statistical Release H. 15. If the Prime Rate becomes unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower. Lender will tell Borrower the current Index rate upon Borrower’s request. Borrower understands that Lender may make loans based on other rates as well. Interest on the unpaid principal balance of this Note will be calculated as described in the “INTEREST CALCULATION METHOD” paragraph. NOTICE: under no circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law.

 

Payments. Both principal and interest are payable in lawful money of the United States of America to the Lender at 7701 France Avenue South, Edina, MN 55435 (or other location specified by the Lender) in immediately available funds. By its execution of this Note, the Borrower authorizes the Lender to charge from time to time against any of Borrower’s depository accounts maintained with the Lender any such payments when due and the Lender will use its reasonable efforts to notify the Borrower of such charges.

 

Interest Calculation Method. Interest on this Note shall be calculated on the basis of a 360-day year and the actual number of days elapsed in any portion of a month in which interest is due. If any payment to be made by the Borrower hereunder shall become due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day.

 

 

 

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

Page 2

 

	U.S. $13,000,000.00  	November 12, 2018

  

 

Prepayment; Minimum Interest Charge. In any event, even upon full prepayment of this Note, Borrower understands that Lender is entitled to a minimum interest charge of $10.00. Other than Borrower’s obligations to pay any minimum interest charge, Borrower may pay without penalty all or a portion of the amount earlier than it is due. Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid interest. Rather, early payment will reduce the principal balance due. Borrower agrees not to send Lender payments marked “paid in full”, “without recourse”, or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender. All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: Minnesota Bank & Trust, 7701 France Avenue South, Edina, MN 55435.

 

Late Charge. If a payment due hereunder is not made within seven days after the date when due, Borrower shall pay to Lender a late payment charge of 5% of the amount of the overdue payment to compensate Lender for a portion of the cost related to handling the overdue payment.

 

Interest After Default. Upon the occurrence of an Event of Default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by adding an additional 3.000 percentage point margin (“Default Rate Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no default. However, in no event will the interest rate exceed the maximum interest rate limitations under applicable law.

 

Credit Agreement. This Note is the Revolving Credit Note referred to in, and is entitled to the benefits of, the Credit Agreement dated as of December 21, 2017 (as amended, modified, supplemented or restated from time to time being the “Credit Agreement”; capitalized terms not otherwise defined herein being used herein as therein defined) between the Borrower and the Lender. The Credit Agreement, among other things, (i) provides for the making of Revolving Credit Loans (the “Revolving Credit Loans”) by the Lender to the Borrower from time to time in an aggregate amount not to exceed at any time outstanding the dollar amount first above mentioned, the indebtedness of the Borrower resulting from each such Revolving Credit Loan being evidenced by this Note; (ii) contains provisions for acceleration of the maturity hereof upon the happening of certain stated events prior to the maturity hereof upon the terms and conditions therein specified; and (iii) contains provisions for the mandatory prepayment hereof upon certain conditions.

 

 

 

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

Page 3

 

	U.S. $13,000,000.00  	November 12, 2018

  

 

Security Agreement. This Note is secured by, among other things, that certain Security Agreement dated as of December 21, 2017, executed by the Borrower and certain of its Subsidiaries in favor of the Lender.

 

Waiver of Presentment and Demand for Payment; Etc. Borrower and any endorsers or guarantors hereof severally waive presentment and demand for payment, notice of intent to accelerate maturity, protest or notice of protest and non-payment, bringing of suit and diligence in taking any action to collect any sums owing hereunder or in proceeding against any of the rights and properties securing payment hereunder, and expressly agree that this Note, or any payment hereunder, may be extended from time to time, and consent to the acceptance of further security or the release of any security for this Note, all without in any way affecting the liability of Borrower and any endorsers or guarantors hereof. No extension of time for the payment of this Note, or any installment thereof, made by agreement by Lender with any Person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note of the undersigned, even if the undersigned is not a party to such agreement.

 

Event of Default.  Any “Event of Default” (as defined in the Credit Agreement) shall constitute an Event of Default under this Note. Upon the occurrence of an Event of Default, in addition to any other rights or remedies Lender may have at law or in equity or under the Credit Agreement or under any other Loan Document, Lender may, at its option, without notice to Borrower, declare immediately due and payable the entire unpaid principal sum hereof, together with all accrued and unpaid interest thereon plus any other sums owing at the time of such Event of Default pursuant to this Note, the Security Agreement or any other Loan Document. The failure to exercise the foregoing or any other options shall not constitute a waiver of the right to exercise the same or any other option at any subsequent time in respect of the same event or any other event. The acceptance by the holder of any payment hereunder which is less than payment in full of all amounts due and payable at the time of such payment shall not constitute a waiver of the right to exercise any of the foregoing options at that time or at any subsequent time.

 

Expense Reimbursement. Borrower agrees to pay all expenses for the preparation of this Note, as set forth in the Credit Agreement, including exhibits, and any amendments to this Note as may from time to time hereafter be required, and the reasonable attorneys’ fees and legal expenses of counsel for Lender from time to time incurred in connection with the preparation and execution of this Note and any document relevant to this Note, any amendments hereto or thereto, and the consideration of legal questions relevant hereto and thereto. Borrower agrees to reimburse Lender upon demand for all reasonable out-of-pocket expenses (including attorneys’ fees and legal expenses) in connection with Lender’s enforcement of the obligations of the Borrower hereunder or under the Security Agreement or any other collateral document, whether or not suit is commenced including, without limitation, attorneys’ fees and legal expenses in connection with any appeal of a lower court’s order or judgment. The obligations of the Borrower under this paragraph shall survive any termination of the Credit Agreement, this Note, the Security Agreement, and any other Loan Document.

 

 

 

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

Page 4

 

	U.S. $13,000,000.00  	November 12, 2018

  

 

Successors and Assigns. This Note shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns except that Borrower may not assign or transfer its rights hereunder without the prior written consent of Lender, which consent may be withheld in Lender’s sole discretion. In connection with the actual or prospective sale by the Lender of any interest or participation in the loan obligation evidenced by this Note, Borrower hereby authorizes the Lender to furnish any information concerning the Borrower or any of its affiliates, however acquired, to any Person or entity.

 

Usury. Borrower and Lender agree that no payment of interest or other consideration made or agreed to be made by Borrower to Lender pursuant to this Note shall, at any time, be in excess of the maximum rate of interest permissible by law. In the event such payments of interest or other consideration provided for in this Note shall result in an effective rate of interest which, for any period of time, is in excess of the limit of the usury or any other law applicable to the loan evidenced hereby, all sums in excess of those lawfully collectible as interest for the period in question shall, without further agreement or notice between or by any party hereto, be applied to the unpaid principal balance and not to the payment of interest; if a surplus remains after full payment of principal and lawful interest, the surplus shall be remitted by Lender to Borrower, and Borrower hereby agrees to accept such remittance. This provision shall control every other obligation of the Borrower and Lender relating to this Note.

 

Business Purpose Loan. The Loan is a business loan. Borrower hereby represents that this loan is for commercial use and not for personal, family or household purposes. The Borrower agrees that the Loan evidenced by this Note is an exempted transaction under the Truth In Lending Act, 15 U.S.C., §1601, et seq.

 

 

 

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

Page 5

 

	U.S. $13,000,000.00  	November 12, 2018

  

 

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

 

WAIVER OF DEFENSES. OTHER THAN CLAIMS BASED UPON THE FAILURE OF THE LENDER TO ACT IN A COMMERCIALLY REASONABLE MANNER, THE BORROWER WAIVES EVERY PRESENT AND FUTURE DEFENSE (OTHER THAN THE DEFENSE OF PAYMENT IN FULL), CAUSE OF ACTION, COUNTERCLAIM OR SETOFF WHICH THE BORROWER MAY NOW HAVE OR HEREAFTER MAY HAVE TO ANY ACTION BY THE LENDER IN ENFORCING THIS NOTE OR ANY OF THE LOAN DOCUMENTS. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER GRANTING ANY FINANCIAL ACCOMMODATION TO THE BORROWER.

 

Waiver of Right to Jury Trial; Venue. BORROWER WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION RELATING TO OR ARISING FROM THIS NOTE. AT THE OPTION OF LENDER, THIS NOTE MAY BE ENFORCED IN ANY UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MINNESOTA OR THE STATE COURT SITTING IN HENNEPIN OR RAMSEY COUNTY, MINNESOTA. BORROWER CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT VENUE IN SUCH FORUMS IS NOT PROPER OR CONVENIENT. IN THE EVENT AN ACTION IS COMMENCED IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS NOTE, LENDER, AT ITS OPTION, SHALL BE ENTITLED TO HAVE THE CASE TRANSFERRED TO ONE OF THE JURISDICTIONS AND VENUES ABOVE DESCRIBED, OR IF SUCH TRANSFER CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED WITHOUT PREJUDICE.

 

Amendment and Restatement. This Note is being executed and delivered in restatement of, but not in payment of, that certain Revolving Credit Note dated December 21, 2017, made by the Borrower payable to the order of the Lender in the original principal amount of $10,000,000.00; provided, however, that interest accrued on such replaced note through the date hereof shall be due and payable on December 1, 2018.

 

 

 

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

Page 6

 

	U.S. $13,000,000.00  	November 12, 2018

  

 

IN WITNESS WHEREOF, the Borrower has caused this Amended and Restated Revolving Credit Note to be signed by its duly authorized officer in favor of Minnesota Bank & Trust and to be dated as of the date set forth above.

 

 

	
			 

				
			AIR T, INC., a Delaware corporation

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				/s/                          	
			 

			
	
			 

				
			Name:

				
			Brett Reynolds

				
			 

			
	
			 

				
			Its:

				
			Chief Financial Officer

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