Document:

Exhibit

Contrail Aviation Support, LLC, Contrail Aviation Leasing, LLC
Loan No. 20007438753.
June 24, 2019
Note
FIRST AMENDED AND RESTATED PROMISSORY NOTE 
TERM NOTE A
$9,920,000.00    June 24, 2019
THIS FIRST AMENDED AND RESTATED PROMISSORY NOTE TERM NOTE A (this “Note”) amends and restates the Promissory Note dated September 14, 2018 in the original principal amount of Nine Million Nine Hundred Twenty Thousand Dollars ($9,920,000.00) (the “Original Note”) executed by CONTRAIL AVIATION SUPPORT, LLC (“Support”) and CONTRAIL AVIATION LEASING, LLC (“Leasing”, and together with Support, each a “Borrower,” and collectively, the “Borrowers”) in favor of OLD NATIONAL BANK (the “Lender,” and together with Borrowers, collectively the “Parties”). Borrowers and Lender desire to amend and restate the Original Note in its entirety as follows:
FOR VALUE RECEIVED, Borrowers, jointly and severally, promise to pay to the order of Lender the principal sum of Nine Million Nine Hundred Twenty Thousand Dollars ($9,920,000.00), together with interest thereon as hereinafter provided.
		
	1.
	RATE OF INTEREST

The principal amount of the Loan outstanding from time to time shall bear interest at the variable rate of LIBOR Rate (as defined in the Master Loan Agreement referenced below) plus 3.75% per annum and such rate shall be adjusted on the 26th day of each month (the “Loan Rate”).
		
	2.
	PAYMENTS

Payments of both principal and interest are to be made in immediately available funds in lawful currency of the United States of America at the office of Lender, or such other place as the holder hereof shall designate to the undersigned in writing.  Unless required by applicable law, and prior to any default being declared, payments will be applied first to any accrued unpaid interest; then to principal; then to escrow; then to any late charges; and then to any unpaid collection costs.  Funds shall be deemed received by Lender on the next business day if not received by 12:00 p.m. local time at the location payments hereunder are to be made.
Borrowers shall make payments of:
		
	(a)
	interest only due on February 26, 2018, March 26, 2018 and April 26, 2018;

		
	(b)
	Two Hundred Fifty Thousand Dollars ($250,000.00) due on July 26, 2018 and on the 26th day of each October, January, April and July thereafter; and

		
	(c)
	a final payment of all outstanding principal and interest together with such other amounts as shall then be due and owing from Borrowers to Lender under the Term Loan A on the Term Loan A Maturity Date.

		
	3.
	FINAL PAYMENT MATURITY DATE

Notwithstanding anything set forth above, all sums due under this Note, both principal and interest, if not sooner paid, shall be due and payable on January 26, 2021 (“Term Loan A Maturity Date”).
		
	4.
	PREPAYMENT; MINIMUM FINANCE CHARGE

Borrowers agree that all loan fees and other prepaid finance charges are earned fully as of the date of the loan and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law.  In any event, even upon full prepayment of this Note, Borrowers understand that Lender is entitled to a minimum finance charge of $95.00.  Other than Borrowers’ obligations to pay any minimum finance charge, Borrowers may pay without penalty all or a portion of the amount owed earlier than it is due.  Early payments will not, unless agreed to by Lender in writing, relieve Borrowers of Borrowers’ obligation to continue to make payments under the payment schedule.  Rather, early payments will reduce the principal balance due and may result in Borrowers making fewer payments.  Borrowers agree not to send Lender payments marked “paid in full,” “without recourse,” or similar language.  If Borrowers send such a payment, Lender may accept it without losing any of Lender’s rights under this Note, and Borrowers will remain obligated to pay any further amounted 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: Old National Bank, PO Box 3728, Evansville, IN 47736‐3728.
		
	5.
	MANDATORY PREPAYMENTS

In addition to, and not in lieu of the payments required in Section 2, Borrowers shall make quarterly payments on Term Loan A equal to the Mandatory Prepayment (as defined in the Master Loan Agreement) calculated for the most recently ended fiscal quarter.  Mandatory Prepayments are due on or before the date that is sixty (60) days following the end of the fiscal quarter to which the Mandatory Prepayment relates.
		
	6.
	PAYMENT DUE DATE/FAILURE TO PAY

		
	(a)
	All payments due under this Note shall be made without demand and received on the dates set forth in Section 2 above;

		
	(b)
	In the event of a default as defined in this Note, or as set forth in the Master Loan Agreement or any Collateral Documents or Guaranty Agreements, at the option of Lender, for so long as the default exists, interest on the outstanding principal balance hereof shall accrue and will be paid at the rate in effect from time to time hereunder plus an additional 3% per annum, but in no event shall such default rate exceed, however, the maximum rate permitted by law (“Default Interest Rate”); and

		
	(c)
	Any installment of principal and/or interest due hereunder which is not received on or before the 10th day following the date on which it is due shall be subject to a late payment fee of 5% of the amount owed on such installment (but not less than $50.00) for the purpose of defraying the expense incident to handling such delinquent payment (this payment is in addition to the amount set forth in (b) above).

		
	7.
	INTEREST RATE COMPUTATION

Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding.  All interest payable under this Note is computed using this method.
		
	8.
	PLACE OF PAYMENT

All payments shall be made to Lender at the address on the interest billing statement provided by Lender or at the address of Lender set forth in Section 14 of this Note, at any branch of Lender, or such other place as Lender may from time to time designate in writing.
		
	9.
	MASTER LOAN AGREEMENT AND SECURITY

This Note evidences indebtedness incurred under; is the “Term Note A” referred to in; and is subject to the terms and provisions of the Master Loan Agreement by and between Borrowers and Lender of even date herewith (as amended, restated, supplemented or otherwise modified from time to time, including, but not limited to, by Supplements thereto, the “Master Loan Agreement”). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Master Loan Agreement.
This Note is secured by the Collateral Documents.  The terms of the Collateral Documents are incorporated herein and made a part hereof by reference.
		
	10.
	DEFAULT

In the event of the occurrence of an Event of Default under the Master Loan Agreement, and after giving effect to any applicable right to cure provided by the Master Loan Agreement, Lender may, at its option and without notice, declare this Note to be, and this Note shall thereupon become, immediately due and payable, together with accrued interest thereon.  Without limiting the foregoing right and without limiting any other rights and remedies of the Lender at law or in equity, the Lender is also entitled to the rights and remedies provided for in the Master Loan Agreement and the Collateral Documents and may enforce the covenants, agreements and undertakings of Borrowers contained therein and may exercise the remedies provided for thereby or otherwise available in respect thereto, all in accordance with the terms thereof In addition to any other right, Lender may apply and/or set‐off against amounts due it hereunder any deposits, account balances, or other credits of any Borrower in the possession of or in transit to Lender, and Borrowers hereby grant Lender a security interest in all of the foregoing.
		
	11.
	WAIVERS

Except as herein provided, Borrowers and all others who may become liable for all or part of the principal balance hereof or for any obligations of Borrowers to Lender or the holder hereof (a) forever waive presentment, protest and demand, notice of protest, demand and dishonor and non‐payment of this Note, and all other notices in connection with the delivery, acceptance, performance, default or enforcement of the payment of this Note, (b) agree that the time of payment of the debt or any part thereof may be extended from time to time without modifying or releasing the lien of the Collateral Documents or the liability of Borrowers or any other such parties, the right of recourse against Borrowers and such parties being hereby reserved by Lender; and (c) agree that time is of the essence.  Borrowers agree to pay all reasonable costs of collection when incurred, whether suit be brought or not, including reasonable attorneys’ fees and costs of suit and preparation therefore, and to perform and comply with each of the covenants, conditions, provisions and agreements of Borrowers contained in this Note, the Master Loan Agreement and Collateral Documents.  It is expressly agreed by Borrowers that no extensions of time for the payment of this Note, nor the failure on the part of Lender to exercise any of its rights hereunder, shall operate to release, discharge, modify, change or affect the original liability under this Note, the Master Loan Agreement or any of the Collateral Documents, either in whole or in part.
		
	12.
	WAIVER OF JURY TRIAL

BORROWERS WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING RELATING TO THIS INSTRUMENT AND TO ANY OF THE LOAN DOCUMENTS, THE OBLIGATIONS HEREUNDER OR THEREUNDER, ANY COLLATERAL SECURING THE OBLIGATIONS, OR ANY TRANSACTION ARISING THEREFROM OR CONNECTED THERETO.  BORROWERS REPRESENT THAT THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY GIVEN.
		
	13.
	COMPLIANCE

This Note is to be governed by, and construed and enforced in accordance with, the laws of the State of Wisconsin (without giving effect to Wisconsin’s principles of conflicts of law), except to the extent (a) of procedural and substantive matters relating only to the creation, perfection, foreclosure and enforcement of rights and remedies against specific collateral, which matters shall be governed by the laws of the state in which the collateral is located (the “Collateral State”), and (b) that the laws of the United States of America and any rules regulations, or orders issued or promulgated thereunder, applicable to the affairs and transactions entered into by the Lender, otherwise preempt Collateral State law or Wisconsin law; in which event such federal law shall control.  Borrowers hereby irrevocably submit to the jurisdiction of any Wisconsin or federal court sitting in Milwaukee, Wisconsin (or, with respect to the matters set forth in subsection (a) above, any state in which the property encumbered by the Collateral Documents is located) over any suit, action or proceeding arising out of or relating to this Note or any of the Loan Documents.  Borrowers hereby waive any right to object to the location of venue in any Wisconsin or federal court sitting in Milwaukee, Wisconsin, or, with respect to the matters set forth in subsection (a) above, to the appropriate court located in the Collateral State, concerning any suit, action or proceeding arising out of or relating to this Note or any of the Loan Documents and waives any objection which it may have at any time to the laying of venue in any proceedings brought in any such court, waives any claim that such proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such proceedings, that such court does not have jurisdiction over such party to object to the choice of governing law set forth in this section.  Borrowers acknowledge that the loan evidenced by this Note was solicited, negotiated, closed and funded in the State of Wisconsin, and waives any implication that the laws of any other state shall apply for usury purposes.
		
	14.
	NOTICES

All notices, requests and demands to be made hereunder to the parties hereto must be in writing and must be delivered to the applicable address stated below by any of the following means: (a) personal service; (b) electronic communication, including, but not limited to electronic mail, telex, telegram or telecopying (and, if by telex, telegram or telecopying, then only if confirmed in writing sent by registered or certified, first class mail, return receipt requested); or (c) registered or certified, first class mail, return receipt requested.  Such addresses may be changed by notice to the other parties given in the same manner as provided above.  Any notice, demand or request sent pursuant to either subsection (a) or (b) hereof will be deemed received upon such personal service or upon dispatch by electronic means, and, if sent pursuant to subsection (c) will be deemed received three (3) days following deposit in the mail.
Borrowers:    CONTRAIL AVIATION SUPPORT, LLC 
CONTRAIL AVIATION LEASING, LLC 
435 Investment Court
Verona, WI 53593‐8788

Lender:    OLD NATIONAL BANK
25 W. Main St.
Madison, WI 53703
		
	15.
	INTEREST NOT TO EXCEED MAXIMUM ALLOWED BY LAW

If from any circumstances whatsoever, by reason of acceleration or otherwise, the fulfillment of any provision of this Note involves transcending the limit of validity prescribed by any applicable usury statute or any other applicable law, with regard to obligations of like character and amount, then the obligations to be fulfilled will be reduced to the limit of such validity as provided in such statute or law, so that in no event shall any exaction be possible under this Note in excess of the limit of such validity.
		
	16.
	SUCCESSORS

All rights, powers, privileges and immunities herein granted to Lender shall extend to its successors and assigns and any other legal holder of this Note, with full right by Lender to assign and/or sell same.
		
	17.
	NOT A NOVATION; AMENDMENT AND RESTATEMENT

This Note is an amendment and restatement of the Original Note.  It is not intended, and shall not be deemed or construed as a novation of the Original Note and the validity, priority and enforceability of the Original Note shall not be impaired hereby.
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IN WITNESS WHEREOF, the Parties have executed this Note as of the date and year first above written.
BORROWER:        LENDER:

CONTRAIL AVIATION SUPPORT, LLC        OLD NATIONAL BANK

By:/s/ Joseph Kuhn___________________        By:/s/ Tommy Olson__________________
Joseph Kuhn        Its: SVP
Its: CEO
CONTRAIL AVIATION LEASING, LLC

By: /s/ Joseph Kuhn___________________    
Joseph Kuhn
Its: CEO

18175026v1

{B0736611.2}Exhibit

SUPPLEMENT #2 TO MASTER LOAN AGREEMENT
Date of Supplement: June 24, 2019
THIS SUPPLEMENT #2 TO MASTER LOAN AGREEMENT (this “Supplement”) is made and entered into by Lender and CAS as of the date written above pursuant to the Master Loan Agreement by and between Lender and Borrowers dated June 24, 2019 (the “Master Loan Agreement”).
This Supplement constitutes a Supplement under the Master Loan Agreement and is hereby made a part of the Master Loan Agreement. All capitalized terms herein not otherwise defined herein shall have the meaning ascribed to them in the Master Loan Agreement. The credit facility described in this Supplement is governed by and shall be construed and administered in accordance with the terms and conditions of the Master Loan Agreement and this Supplement.
To the extent any term or condition of this Supplement is inconsistent with any term or condition in the Master Loan Agreement or in any Supplement dated prior to this Supplement, the terms and conditions of this Supplement shall control. Except as specifically amended hereby, all terms and conditions of the Master Loan Agreement and all prior Supplements remain in effect.
In consideration of the mutual covenants contained herein and in the Master Loan Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledges, the Parties agree as follows:
		
	1.
	DEFINITIONS.

As used in this Supplement, the following terms have the following meanings:
“CAL Guaranty” means the continuing guaranty of CAL in the form of Exhibit A to be executed concurrently with this Supplement.
“Debt Service Coverage Ratio” means a ratio, the numerator of which shall be EBITDA for the 12-month period then ended and the denominator being the sum of: (i) Debt Service for the same period; plus (ii) the aggregate amount of payments required to be paid by Borrowers by amortizing the lowest principal balance outstanding on the Revolving Note at any time during the applicable Testing Period over a hypothetical five-year period at the then outstanding interest rate in effect at the time of the testing.
“Resting Period” has the meaning ascribed to it in Section 2.4(b) of this Supplement.
“Revolving Loans” means extensions of credit to CAS by Lender pursuant to this Supplement.
“Revolving Note” means the Amended and Restated Revolving Note of CAS in the form of Exhibit B to be executed concurrently with this Supplement.
“Revolving Note Maturity Date” means May 5, 2019, or such earlier date on which the Revolving Note becomes due and payable pursuant to this Supplement or the Master Loan Agreement.
“Testing Period” has the meaning ascribed to it in Section 2.4(b) of this Supplement.
		
	2.
	THE CREDIT FACILITY; BORROWING PROCEDURES; INTEREST RATE; PAYMENTS; AND FEES.

		
	2.1.
	Credit Facility. So long as no Event of Default has occurred or the obligation of the Lender to advance funds under the Revolving Loans has not been extinguished, Lender may lend to CAS and CAS agrees to borrow from Lender (and to repay to Lender in accordance with the terms hereof) from time to time an aggregate principal sum equal to the principal face amount of the Revolving Note. As long as no Event of Default shall have occurred and be continuing, and subject to the further conditions and limitations contained herein and until expiration or maturity of the Revolving Loans, upon acceleration or otherwise, CAS may borrow, repay and re-borrow the Revolving Loans. If at any time the aggregate principal outstanding of Revolving Loans exceeds the principal face amount of the Revolving Note, CAS shall immediately repay to Lender, without the necessity of notice or demand from Lender, an amount not less than such excess.

All Revolving Loans made pursuant to this Supplement will be evidenced by the Revolving Note, shall be payable, as to interest, in accordance with the Revolving Note, and as to the principal, on the Revolving Note Maturity Date and will be made by deposits or transfers to CAS’s demand deposit account maintained with Lender or as otherwise directed by CAS. Although the Revolving Note shall be expressed to be payable in the full amount specified above, CAS shall be obligated to pay only the principal amount of Revolving Loans actually disbursed to or for the account of CAS, together with interest on the unpaid balance of the sums so disbursed, which remain outstanding from time to time as shown on the records of Lender.
		
	2.2.
	Borrowing Procedures. CAS shall request Revolving Loans by written notice, or by telephonic notice confirmed in writing, to Lender, not later than 2:00 p.m., Milwaukee time, on the requested Borrowing Date (which must be a Business Day). Each such request by CAS, must specify the amount of the requested Loan. In the event of any inconsistency between the telephonic notice and the written confirmation thereof, the telephonic notice shall control.

Each request for a Revolving Loan shall be irrevocable and shall constitute a certification by CAS that the borrowing conditions specified in Section 5.2 of the Master Loan Agreement and any conditions set forth in Section 3 of this Supplement will be satisfied on the specified Borrowing Date. Upon fulfillment of the applicable borrowing conditions set forth in Section 5.2 of the Master Loan Agreement and any conditions set forth in Section 3 of this Supplement, Lender shall deposit the Loan proceeds in CAS’s demand deposit account maintained with Lender or as CAS may otherwise direct in writing.
Notwithstanding anything contained herein to the contrary, in the event CAS and Lender have established a loan sweep arrangement, the terms of the documents governing such loan sweep, as applicable, shall supersede the borrowing procedures contained herein.
		
	2.3.
	Interest Rate. The unpaid principal balance of each of the Revolving Loans outstanding from time to time shall bear interest for the period commencing on the Borrowing Date of such Loan until such Loan is paid in full. The Revolving Loans shall accrue interest at a variable rate equal to the LIBOR Rate plus 3.00% per annum and such rate shall be adjusted on the 7th day of each month.

		
	2.4.
	Payments. CAS shall make the following payments on the Revolving Loans during the following periods:

		
	(a)
	Monthly Payments. Monthly payments of accrued unpaid interest only on the Revolving Loans due in arrears on the ‘7th day of each month, commencing on March 7, 2018, together with a final payment of the outstanding principal balance together with all accrued but unpaid interest together with such other amounts as shall then be due and owing from CAS to Lender under the Revolving Note due on the Revolving Note Maturity Date.

		
	(b)
	Revolving Loan Resting Period. CAS shall also make principal payments necessary to cause the total outstanding principal balance of all Revolving Loans to be zero (0) for at least thirty (30) consecutive days (the “Resting Period”) during the term of the Revolving Loans, or if the term of the Revolving Loans exceeds one (1) year, during each annual period ending on the anniversary of the date of the Revolving Loans (each a “Testing Period”). Notwithstanding the foregoing, CAS shall have no obligation to cause a Resting Period, if, at the time that a Resting Period would otherwise be required hereunder, CAS achieves a Debt Service Coverage Ratio of 1.10:1.

		
	2.5.
	Fees.

		
	(a)
	[Intentionally Omitted].

		
	3.
	CONDITIONS FOR BORROWING.

In addition to all conditions to borrowing set forth in Section 5.1 of the Master Loan Agreement, Lender’s obligation to make the Loan described in this Supplement is subject to the satisfaction or waiver by Lender in writing on or before the Closing Date of such Loan of the following conditions:
		
	3.1.
	Lender shall have received the following, all in form, detail and content satisfactory to Lender:

		
	(a)
	The Revolving Note duly executed by CAS; and

		
	(b)
	The CAL Guaranty duly executed by CAL.

		
	4.
	AFFIRMATIVE COVENANTS.

In addition to all affirmative covenants set forth in Section 6 of the Master Loan Agreement, each Borrower covenants that it will, until Lender’s commitment to extend credit under this Supplement and all Permitted Swap Agreements relating to the credit facility extended under this Supplement have terminated or expired and the promissory note evidencing the credit facility extended under this Supplement, and all fees and expenses payable in connection with the credit facility extended under this Supplement have been paid in full:
		
	4.1.
	Quarterly Rolling Cash Flow Coverage Ratio. Maintain, as of the last day of each fiscal quarter, a Quarterly Rolling Cash Flow Coverage Ratio of not less than 1.25 to 1.0. Lender may determine compliance with this Quarterly Cash Flow Coverage Ratio covenant at any time.

		
	4.2.
	Tangible Net Worth. Maintain a Tangible Net Worth of at least $8,500,000 at all times. Lender may determine compliance with this Tangible Net Worth covenant at any time.

		
	5.
	NEGATIVE COVENANTS.

In addition to all negative covenants set forth in Section 7 of the Master Loan Agreement, each Borrower covenants that, without the prior written consent of Lender, Borrowers will not, until Lender’s commitment to extend credit under this Supplement and all Permitted Swap Agreements relating to the credit facility extended under this Supplement have terminated or expired and the promissory note evidencing the credit facility extended under this Supplement, and all fees and expenses payable in connection with the credit facility extended under this Supplement, have been paid in full:
		
	5.1.
	[Intentionally Omitted].

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IN WITNESS WHEREOF, the Parties have executed this Supplement as of the date first written above.
BORROWERS:        LENDER:

CONTRAIL AVIATION SUPPORT, LLC        OLD NATIONAL BANK

By:    /s/ Joseph Kuhn        By:    /s/ Tommy Olson    
Joseph Kuhn        Its:    SVP    
Its: CEO

18160956v1

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