Document:

Document

AMENDED AND RESTATED GUARANTY
THIS GUARANTY, dated as of August 31, 2021, is jointly and severally executed by the guarantors listed on the signature pages hereto (the "Original Guarantors", or from time to time party hereto by execution of a joinder agreement (the "Additional Guarantors", and together with the Original Guarantors, the "Guarantors"), in favor of MINNESOTA BANK & TRUST, a Minnesota state banking corporation (together with its successors and assigns, the “Lender”).

RECITALS

WHEREAS, Air T, Inc., a Delaware corporation (together with its successors and assigns, “Air T”), and Minnesota Bank & Trust, a Minnesota state banking corporation (together with its successors and assigns, the “Lender”), entered into that certain Credit Agreement dated as of December 21, 2017 (the “Original Credit Agreement”).

WHEREAS, the Original Credit Agreement was amended and restated in its entirety by that certain Amended and Restated Credit Agreement dated as of March 28, 2019 (such Amended and Restated Credit Agreement, as amended to date being, the “First Amended and Restated Credit Agreement”) by and between Air T and Lender.

WHEREAS, The First Amended and Restated Credit Agreement was amended and restated in its entirety by that certain Second Amended and Restated Credit Agreement dated as of June 26, 2021 (such Amended and Restated Credit Agreement, as amended to date being, the “Existing Credit Agreement”) by and between Air T and Lender.

WHEREAS, Air T has requested that the Lender make an additional $2,500,000 advance under Term Loan A outstanding under the Existing Credit Agreement.

WHEREAS, Air T has further requested that its subsidiary, Jet Yard, LLC, an Arizona limited liability company (“Jet Yard”; and together with Air T being sometimes collectively referred to herein as the “Borrowers” or individually as a “Borrower”), be added as an additional “Borrower” party to the Existing Credit Agreement and that the Lender provide a $2,000,000 term loan (the “Jet Yard Term Loan”) to Jet Yard to finance construction of a ground hardening project at Jet Yard’s facility located in Marana, Arizona.

WHEREAS, as a condition to agreeing to such requests, the Lender has required, among other things, that the Existing Credit Agreement be amended and restated in its entirety pursuant to that certain Third Amended and Restated Credit Agreement of even date herewith (such Third Amended and Restated Credit Agreement, as it may be amended, modified, supplemented, replaced or restated from time to time being, the “Credit Agreement”) for the purposes of, among other things: (1) adding Jet Yard as an additional Borrower party; (2) making an additional $2,500,000 Term Loan A disbursement; and (3) providing the Jet Yard Term Loan on the Effective Date of this Agreement.
084126\039\5915532.v1

WHEREAS, in order to induce Lender to enter into the Credit Agreement, and as additional security for the Loans and for all sums advanced by the Lender under the Notes and the Credit Agreement, and for the payment and performance by Borrowers of their obligations under the Notes and the Credit Agreement, Borrowers have agreed to obtain, and Guarantors have jointly and severally agreed to execute this Guaranty to amend and restate in its entirety that certain Amended and Restated Guaranty dated as March 28, 2019 (the “Existing Guaranty”) previously executed by the undersigned in favor of the Lender.

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

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

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

Section 1.    Guaranty of Payment.  For value received, and in consideration of any loan or other financial accommodation heretofore or hereafter at any time made or granted to either or both Borrowers, by the Lender, the undersigned hereby jointly and severally unconditionally guarantee the full and prompt payment when due, whether by acceleration or otherwise, and at all times thereafter, of all obligations of the Borrowers to the Lender, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, or now or hereafter existing, or due or to become due, including, without limitation, all Obligations of the Borrowers to the Lender pursuant to that certain Third Amended and Restated Credit Agreement dated as of August __, 2021 (as the same may be amended, modified, supplemented, restated or replaced from time to time, the “Credit Agreement”; capitalized terms not otherwise defined herein shall have the meanings respectively ascribed to such terms in the Credit Agreement) by and between the Borrowers and the Lender (all such obligations being hereinafter collectively called the “Obligations”), and each of the undersigned further agrees to pay all expenses, including fees of attorneys (who may be employees of the Lender or any Affiliate) and legal expenses, paid or incurred by the Lender in endeavoring to collect the Obligations, or any part thereof, and in enforcing this Guaranty. 
Section 2.    Acceleration of the Time of Payment of Amount Payable Under the Guaranty.  Each of the undersigned agrees that if any of the undersigned shall be dissolved or shall be or become insolvent (however defined) or any of the undersigned voluntarily commences or there is commenced involuntarily against such undersigned a case under the United States Bankruptcy Code, the full amount of all Obligations, whether due and payable or 
2

unmatured, shall be immediately due and payable without demand or notice thereof, to the extent provided in the Credit Agreement.
Section 3.    Security Interest in Deposits and Other Property.  To secure all obligations of each of the undersigned hereunder, the Lender shall have a Lien upon and security interest in (and may, without demand or notice of any kind, at any time and from time to time when any amount shall be due and payable by such undersigned hereunder, appropriate and apply toward the payment of such amount, in such order as the Lender may elect, any and all balances, credits, deposits (general or special, time or demand, provisional or final), accounts or moneys of or in the name of such undersigned now or hereafter with the Lender or any Affiliate of the Lender and any and all property of every kind or description of or in the name of such undersigned now or hereafter with the Lender or any Affiliate of the Lender and any and all property of every kind or description of or in the name of such undersigned now or hereafter, for any reason or purpose whatsoever, in the possession or control of, or in transit to, the Lender or any Affiliate of the Lender or bailee for any such Person.
Section 4.    Continuing Guaranty.  This Guaranty shall in all respects be a continuing, absolute and unconditional Guaranty, and shall remain in full force and effect (notwithstanding, without limitation, the dissolution of any of the undersigned or that at any time or from time to time all Obligations may have been paid in full), subject to discontinuance as to any of the undersigned only upon actual receipt by the Lender of written notice from such undersigned, or any person duly authorized and acting on behalf of such undersigned, of the discontinuance hereof as to such undersigned; provided, however, that no such notice of discontinuance shall affect or impair any of the agreements and obligations of such undersigned hereunder with respect to any and all Obligations existing prior to the time of actual receipt of such notice by the Lender, any and all Obligations created or acquired thereafter pursuant to any previous commitments made by the Lender, any and all extensions or renewals of any of the foregoing, any and all interest on any of the foregoing, and any and all expenses paid or incurred by the Lender in endeavoring to collect any of the foregoing and in enforcing this Guaranty against such undersigned; and all of the agreements and obligations of such undersigned under this Guaranty shall, notwithstanding any such notice of discontinuance, remain fully in effect until all such Obligations (including any extensions or renewals of any thereof) and all such interest and expenses shall have been paid in full.  Any such notice of discontinuance by or on behalf of any of the undersigned shall not affect or impair the obligations hereunder of any other of the undersigned.
Section 5.    Recission or Return of Payment on Obligations.  The undersigned further jointly and severally agree that, if at any time all or any part of any payment theretofore applied by the Lender to any of the Obligations is or must be rescinded or returned by the Lender for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of either or both Borrowers or any of the undersigned), such Obligations shall, for the purposes of this Guaranty, to the extent that such payment is or must be rescinded or returned, be deemed to have continued in existence, notwithstanding such application by the Lender, and this Guaranty shall continue to be effective or be reinstated, as the case may be, as to such Obligations, all as though such application by the Lender had not been made.
3

Section 6.    Lender Permitted to Take Certain Actions.  The Lender may, from time to time (but shall not be obligated to), whether before or after any discontinuance of this Guaranty, at its sole discretion and without notice to the undersigned (or any of them), take any or all of the following actions:  (a) retain or obtain a security interest in any property to secure any of the Obligations or any obligation hereunder; (b) retain or obtain the primary or secondary obligation of any obligor or obligors, in addition to the undersigned, with respect to any of the Obligations; (c) extend or renew for one or more periods (whether or not longer than the original period), alter or exchange any of the Obligations, or release or compromise any obligation of any of the undersigned hereunder or any obligation of any nature of any other obligor with respect to any of the Obligations; (d) release its security interest in, or surrender, release or permit any substitution or exchange for, all or any part of any property securing any of the Obligations or any obligation hereunder, or extend or renew for one or more periods (whether or not longer than the original period) or release, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such property; and (e) resort to the undersigned (or any of them) for payment of any of the Obligations, whether or not the Lender (i) shall have resorted to any property securing any of the Obligations or any obligation hereunder or (ii) shall have proceeded against either or both Borrowers or any other of the undersigned or any other obligor primarily or secondarily obligated with respect to any of the Obligations (all of the actions referred to in preceding clauses (i) and (ii) being hereby expressly waived by the undersigned).
Section 7.    Application of Payments.  Any amounts received by the Lender from whatsoever source on account of the Obligations may  be applied by it toward the payment of such of the Obligations and in such order of application, as the Lender  may from time to time elect.
Section 8.    Subordination.  Except as the Lender may hereafter expressly consent in writing, the payment of all obligations of the Borrowers to the undersigned, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent or now or hereafter existing, as due or to become due (collectively, the “Guarantor Liabilities”) shall be postponed and subordinated to the payment in full of all Obligations, and no payments or other distributions whatsoever in respect of any Guarantor Liabilities shall be made, nor shall any property or assets of the Borrowers or any other person obligated on the Obligations be applied to the purchase or other acquisition or retirement of any Guarantor Liabilities following the occurrence and during the continuance of any Event of Default.  If any payment on the Guarantor Liabilities is prohibited from being paid by operation of this Guaranty such payment shall be payable only after the payment in full of the Obligations and the termination of the Credit Agreement, and either or both Borrowers’ failure to make a payment on the Guarantor Liabilities by reason of this Guaranty shall not constitute an event of default on the Guarantor Liabilities.
Section 9.     Waiver of Claims.  Until such time as this Guaranty shall have been discontinued as to all of the undersigned and the Lender shall have received payment of the full amount of all Obligations and of all obligations of the undersigned hereunder and the Credit Agreement has been terminated, no payment made by or for the account of the undersigned (or any of them) pursuant to this Guaranty shall entitle any of the undersigned by subrogation or otherwise to any payment by either or both Borrowers or from or out of any property of either or 
4

both Borrowers, and none of the undersigned shall exercise any right or remedy against either or both Borrowers or any property of either or both Borrowers by reason of an performance by such undersigned of this Guaranty.
Section 10.    Waiver of Notice and Other Matters.  Each of the undersigned hereby expressly waives:  (a) notice of the acceptance by the Lender of this Guaranty; (b) notice of the existence or creation or non-payment of all or any of the Obligations; (c) presentment, demand, notice of dishonor, protest, and all other notices whatsoever; and (d) all diligence in collection or protection of or realization upon the Obligations or any thereof, any obligation hereunder, or any security for or guaranty of any of the foregoing.
Section 11.    Assignment of Obligations.  Subject to provisions of Credit Agreement, the Lender may, from time to time, whether before or after any discontinuance of this Guaranty, without notice to the undersigned (or any of them), assign or transfer any or all of the Obligations or any interest therein; and, notwithstanding any such assignment or transfer or any subsequent assignment or transfer thereof, such Obligations shall be and remain Obligations for the purposes of this Guaranty, and each and every immediate and successive assignee or transferee of any of the Obligations or of any interest therein shall, to the extent of the interest of such assignee or transferee in the Obligations, be entitled to the benefits of this Guaranty to the same extent as if such assignee or transferee were the transferor; provided, that, unless the Lender shall otherwise consent in writing, the Lender shall have an unimpaired right, prior and superior to that of any such assignee or transferee, to enforce this Guaranty, for the benefit of the Lender, as to those of the Obligations which the Lender has not assigned or transferred.
Section 12.    Information Concerning Borrowers.  Each of the undersigned hereby warrants to the Lender that such undersigned now has and will continue to have independent means of obtaining information concerning the affairs, financial condition and business of the Borrowers.   The Lender shall not have any duty or responsibility to provide the undersigned (or any of them) with any credit or other information concerning the affairs, financial condition or business of the Borrowers, which may come into the Lender’s possession.
Section 13.    Waiver and Modifications.  No delay on the part of the Lender in the exercise of any right or remedy shall operate as a waiver thereof, and no single or partial exercise by the Lender of any right or remedy shall preclude other or further exercise thereof or the exercise of any other right or remedy; nor shall any modification or waiver of any of the provisions of this Guaranty be binding upon the Lender except as expressly set forth in a writing duly signed and delivered on behalf of the Lender.
Section 14.    Obligations Under Guaranty.  No action of the Lender permitted hereunder shall in any way affect or impair the rights of the Lender and the obligations of the undersigned under this Guaranty.  For the purposes of this Guaranty, the Obligations shall include all Obligations of the Borrowers to the Lender, notwithstanding any right or power of either or both Borrowers or anyone else to assert any claim or defense as to the invalidity or un enforceability of any such Obligation, and no such claim or defense shall affect or impair the obligations of the undersigned hereunder.  The obligations of the undersigned under this Guaranty shall be absolute and unconditional irrespective of any circumstance whatsoever which 
5

might constitute a legal or equitable discharge or defense of the undersigned (or any of them).  Each of the undersigned hereby acknowledges that there are no conditions to the effectiveness of this Guaranty.
Section 15.    Successors.  This Guaranty shall be binding upon each of the undersigned, and upon the successors and assigns of such undersigned, and to the extent that either or both Borrowers or any of the undersigned is either a partnership or a corporation, all references herein to the Borrowers and to the undersigned, respectively, shall be deemed to include any successor or successors, whether immediate or remote, to such partnership or corporation.
Section 16.    Joint and Several Obligation.  If more than one party shall execute this Guaranty, the term “undersigned,” as used herein, shall mean all parties executing this Guaranty and each of them, and all such parties shall be jointly and severally obligated hereunder.
Section 17.    Governing Law.  THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THIS GUARANTY SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.

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

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

Section 20.    Severability.  Wherever possible, each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be 
6

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

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

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

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

    Section 24.    Amendment and Restatement.  This Guaranty supersedes and replaces the Existing Guaranty.  Delivery and acceptance of this Guaranty shall not evidence release or satisfaction of or a novation with respect to such prior guaranty or any obligations of Guarantor under such prior guaranty, which obligations remain outstanding and shall be evidenced by this Guaranty.  The liens, security interests, assignments and other rights evidenced by this Guaranty are hereby renewed and extended to secure payment of the Notes and the other Obligations.
    Section 25.    Acknowledgment. Each Guarantor hereby acknowledges that such Guarantor has received copies of the Credit Agreement, the Notes and the other Loan Documents, and consents to the Borrowers’ execution and delivery of the Loan Documents.
7

    Section 26.    Counterparts.  This Guaranty may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument.  It shall not be necessary in making proof of this Guaranty to produce or account for more than one such counterpart.  Delivery of an executed counterpart of a signature page of this Guaranty by fax transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Guaranty.  
[SIGNATURE PAGES FOLLOW]
8

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

AIRCO, LLC

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

AIR T GLOBAL LEASING, LLC

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

AIRCO SERVICES, LLC

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

AIRCO 2, LLC

By: AIRCO, LLC
Its: Sole Member

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 1 OF 4)

Air’Zona Aircraft Services, LLC

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

CSA AIR, INC.

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

GLOBAL GROUND SUPPORT, INC.

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

JET YARD SOLUTIONS, LLC

By: Stratus Aero Partners, LLC
Its: Sole Member

By: Air T, Inc., a Delware corporation
Its: Manager

By: /s/ Brian Ochocki        
Name: Brian Ochocki
Its:       Chief Financial Officer

MOUNTAIN AIR CARGO, INC.

By:/s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 2 OF 4)

SPACE AGE INSURANCE COMPANY

By: /s/ Mark Jundt            
Name:  Mark Jundt
Title:     Secretary

STRATUS AERO PARTNERS, LLC

By: Air T, Inc., a Delware corporation
Its: Manager

By: /s/ Brian Ochocki            
Name: Brian Ochocki
Its:       Chief Financial Officer

WORTHINGTON AVIATION, LLC 

By:    /s/ Brian Ochocki            
Name:  Brian Ochocki
Its:      Chief Financial Officer

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 3 OF 4)

			
	AGREED TO AND ACCEPTED:

MINNESOTA BANK & TRUST, a Minnesota state banking corporation

	By: /s/ Dianne Wegscheid    
Name:  Dianne Wegscheid
Title:    Senior Vice President

    

SIGNATURE PAGE:  AMENDED AND RESTATED GUARANTY (PAGE 4 OF 4)Document

AMENDED AND RESTATED COLLATERAL ACCOUNT AGREEMENT

THIS AMENDED AND RESTATED COLLATERAL ACCOUNT AGREEMENT is made as of August 31, 2021 (the “Agreement”), by and between AMBRY HILL TECHNOLOGIES LLC, a Minnesota limited liability company (together with its successors and assigns “Grantor”), and MINNESOTA BANK & TRUST, Minnesota banking corporation (together with its successors and assigns, the “Secured Party”).

WITNESSETH

    A.    Air T, Inc., a Delaware corporation (“Air T”), and the Secured Party are parties to that certain Second Amended and Restated Credit Agreement dated as of June 26, 2020 (the “Existing Credit Agreement”), pursuant to which the Secured Party has extended credit to Air T.

    B.    As a condition precedent to the effectiveness of the Existing Credit Agreement, Grantor executed and delivered to Lender that certain Collateral Account Agreement dated June 26, 2020 (the “Existing Agreement”).

    C.    Air T has requested that the Secured Party amend the Existing Credit Agreement to, among other things, add its subsidiary, Jet Yard, LLC, an Arizona limited liability company (“Jet Yard”; and together with Air T being sometimes collectively referred to herein as the “Borrowers” or individually as a “Borrower”) and extend additional credit to the Borrowers. 

    D.    The Secured Party has agreed to such requests of Air T, pursuant to and subject to the terms and conditions of, that certain Third Amended and Restated Credit Agreement dated as of even date herewith (such Third Amended and Restated Credit Agreement, as it may be amended, modified, supplemented, replaced or restated from time to time being, the “Credit Agreement”) amending and restating the Existing Credit Agreement in its entirety.

    E.    As a condition precedent to the effectiveness of the Credit Agreement, Secured Party has required that, among other things, Grantor execute and deliver this Agreement.

    f.    Grantor has determined that the execution, delivery and performance of this Agreement are in its best business and pecuniary interest.

NOW THEREFORE, in consideration of the foregoing and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as set forth below:

1.    Defined Terms.  Capitalized terms used herein and not otherwise defined shall have the meaning ascribed to such terms in the Credit Agreement.

2.    Cash Collateral Account.  Grantor has established a demand deposit account bearing Account Number ___ (the “Cash Collateral Account”) with the Secured Party.  All 
    
5920640.v1

deposits into the Cash Collateral Account are hereinafter referred to as the “Funds”.  The Funds shall be held, applied to the Obligations and released by the Secured Party in accordance with the terms and conditions of this Agreement.  

3.    Security Interest.  In order to secure Grantor’s repayment of the Obligations and the performance of all covenants and conditions required on the part of Grantor to be observed or performed hereunder or under the Credit Agreement or any other Loan Document, Grantor hereby pledges to and grants to the Secured Party a continuing security interest in the Funds and in the Cash Collateral Account.  Until applied to the Obligations or released as provided below, the Funds and the Cash Collateral Account shall constitute security for the Obligations.  Pursuant to this Agreement, Grantor has granted to the Secured Party a direct security interest in the Funds and the Cash Collateral Account and such Funds and the Cash Collateral Account are not claimed merely as proceeds of other collateral.

4.    Application of Funds.  The Cash Collateral Account shall be under the sole dominion and control of Secured Party.  Funds deposited in the Cash Collateral Account shall be applied to the Obligations as and when such Funds become available funds (subject to the Secured Party’s funds availability policy) upon the earliest to occur of (a) the occurrence of an Event of Default; or (b) the Termination Date.   Notwithstanding the foregoing, Grantor shall have the right to transfer Funds from the Cash Collateral Account to another Collateral Account maintained by another Pledgor Party with the Secured Party without the consent of Secured Party.

5.    Investments.  The Cash Collateral Account shall be a demand deposit account maintained with the Secured Party.

6.    No Rights to Funds.  Except for Secured Party’s rights under Section 4 of this Agreement, no Person, including, without limitation, Grantor shall have any right to withdraw any of the Funds held in the Cash Collateral Account, without the prior written consent of Secured Party and (b) unless previously applied by the Secured Party pursuant to Section 4 hereof, the Secured Party shall pay any Funds remaining in the Cash Collateral Account to Grantor or to whomever may be legally entitled thereto upon the indefeasible payment in full of all Obligations in cash following the termination of Secured Party’s obligation to extend credit to Grantor.

7.    No Liens.  Grantor agrees that it will not (a) sell or otherwise dispose of any interest in the Cash Collateral Account or any Funds held therein, or (b) create or permit to exist any lien, security interest or other charge or encumbrance upon or with respect to the Cash Collateral Account or any Funds held therein except in favor of the Secured Party.

8.    Care of Account.  The Secured Party shall exercise reasonable care in the custody and preservation of any Funds held in the Cash Collateral Account and shall be deemed to have exercised such care if such Funds are accorded treatment substantially equivalent to that which the Secured Party accords to its own property, it being understood that the Secured Party shall 
    2

not have any responsibility for taking any necessary steps to preserve rights against any parties with respect to any such Funds.

9.    Remedies Cumulative.  No right or remedy conferred upon or reserved to the Secured Party under this Agreement is intended to be exclusive of any other right or remedy, and each and every such right and remedy shall be cumulative and concurrent and may be enforced separately, successively or together, and may be exercised from time to time as often as may be deemed necessary by the Secured Party.

10.    Indemnification.  Grantor hereby agrees to indemnify Secured Party against all liability arising in connection with or on account of the Cash Collateral Account or on account of this Agreement, except for any such liabilities arising solely on account of Secured Party’s gross negligence or willful misconduct.

11.    Deposit Agreements. The terms and conditions of this Agreement are in addition to any deposit account agreements and other related agreements that Grantor has with Secured Party, including without limitation all agreements concerning banking products and services, treasury management documentation, account booklets containing the terms and conditions of the Cash Collateral Account, signature cards, fee schedules, disclosures, specification sheets and change of terms notices (collectively, the "Deposit Agreements").  The provisions of this Agreement shall supersede the provisions of the Deposit Agreements only to the extent the provisions herein are inconsistent with the Deposit Agreements, and in all other respects, the Deposit Agreements shall remain in full force and effect. All items deposited into the Deposit Account shall be processed according to the provisions of the Deposit Agreements, as amended by this Agreement.

12.    Miscellaneous.

(a)    Except as otherwise expressly provided herein, in any instance where the consent or approval of the Secured Party is required or may be given or where any determination, judgment or decision is to be rendered by the Secured Party under this Agreement, such approval and consent shall be given or withheld in the Secured Party’s sole and absolute discretion.

(b)    All notices hereunder shall be given in accordance with the provisions of the Credit Agreement.

(c)    This Agreement shall be binding upon Grantor and its successors and assigns and shall inure to the benefit of the Secured Party and its successors and assigns.  Grantor shall not assign any of its rights or obligations under this Agreement without the prior written consent of the Secured Party. 

(d)    This Agreement is intended solely for the benefit of the Secured Party, and no third party shall have any right or interest in this Agreement, nor any right to enforce this Agreement against any party hereto.
    3

(e)    This Agreement may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Grantor or the Secured Party, but only by an agreement in writing signed by the party against whom the enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought.

(f)    If any provision of this Agreement shall conflict with any provisions of the other Credit Agreement or any Loan Document regarding the Cash Collateral Account or the Funds, the provisions most favorable to the Secured Party shall control.

(g)    If any term, covenant or condition of this Agreement is held to be invalid, illegal or unenforceable in any respect, this Agreement shall be construed without such provision.

(h)    THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.  THE PARTIES AGREE THAT MINNESOTA IS THE "SECURED PARTY’S JURISDICTION" FOR PURPOSES OF THE UNIFORM COMMERCIAL CODE.

(i)    Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

(j)        EACH OF THE GRANTOR AND THE SECURED PARTY HEREBY WAIVES ANY RIGHT WHICH SUCH PERSON MAY HAVE TO A TRIAL BY JURY IN ANY ACTION RELATING TO THIS AGREEMENT.

(k)    AT THE OPTION OF THE SECURED PARTY, THIS AGREEMENT MAY BE ENFORCED IN ANY FEDERAL COURT OR STATE COURT SITTING IN MINNEAPOLIS OR ST. PAUL, MINNESOTA; GRANTOR CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVE ANY ARGUMENT THAT JURISDICTION IS NOT PROPER AND THAT VENUE IN SUCH FORUMS IS NOT 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 AGREEMENT, SECURED PARTY, 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.

    4

(l)    The recitals to this Agreement are incorporated into and constitute an integral part of this Agreement.

(m)    Secured Party’s right to withdraw and apply amounts in the Cash Collateral Account shall be in addition to all other rights and remedies provided to the Secured Party under the Credit Agreement and the other Loan Documents and at law or in equity.

(n)    Grantor and the Secured Party agree that: (i) the Secured Party has “control” over the Cash Collateral Account within the meaning of Section 9-104 of the Uniform Commercial Code enacted in the State of Minnesota (the “UCC”); and (ii) pursuant to Section 9-314(b) of the UCC, the Secured Party’s security interest in the Cash Collateral Account is perfected by control.

(o)    The Existing Agreement is amended and restated in its entirety by this Agreement, but such amendment and restatement does not alter the original date and continuing effectiveness of, the Existing Agreement.

(p)    To facilitate execution, this document may be executed in as many counterparts as may be convenient or required. It shall not be necessary that the signature of, or on behalf of, each party, or that the signature of all persons required to bind any party to, appear on each counterpart. All counterparts shall collectively constitute a single document. It shall not be necessary in making proof of this document to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each of the parties hereto. Any signature page to any counterpart may be detached from such counterpart without impairing the legal effect of the signatures thereon and thereafter attached to another counterpart identical thereto except having attached to it additional signature pages.  Receipt by telecopy, pdf file or other electronic means of any executed signature page to this Agreement shall constitute effective delivery of such signature page.

[signature page follows]
    5

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date first written above.

MINNESOTA BANK & TRUST, a Minnesota state banking corporation

By: /s/Dianne Wegscheid____________________
Name: Dianne Wegscheid
Its:     Senior Vice President

    Address for Notices:
9800 Bren Road East, Suite 200
Minnetonka, MN  55343
Attention:  Mr. Dianne Wegscheid, SVP

    With a copy to (which shall not constitute notice or service of process):

Fabyanske, Westra, Hart & Thomson, P.A
333 South Seventh Street, Suite 2600
Attention:  Frederick H. Ladner, Esq.

AMBRY HILL TECHNOLOGIES LLC, a Minnesota limited liability company

By: Air T, Inc., a Delware corporation
Its: Sole Member

By: /s/Brian Ochocki            
Name: Brian Ochocki
Its:  Chief Financial Officer 
Address for Notices:        5000 West 36th Street, Suite 200
Minneapolis, MN  55416
Attention: Mark Jundt, Esq.

    With a copy to (which shall not constitute notice or service of process):

Winthrop & Weinstine, P.A.
225 S. 6th Street
Minneapolis, MN 55402
Attention:  Phil Coltan, Esq.
[Amended and Restated Collateral Account Agreement Signature Page]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00333-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00333-of-00352.parquet"}]]