Air T, Inc. (NASDAQ:AIRT) Files An 8-K Entry into a Material Definitive Agreement

To the extent responsive, the information included in Items 2.01 and 2.03 is incorporated herein by reference.

Item 2.01 Completion of Acquisition or Disposition of Assets

On February 3, 2020, Contrail Aviation Support, LLC (“CAS”), a 79%-owned subsidiary Air T, Inc. (the “Company”) acquired one Airbus A321-100 aircraft with serial number 583 and two CFM56-5B2 engines with serial numbers 779182 and 779127 from Diamond Head 2 (Ireland) DAC (collectively, “Aircraft 583”). Aircraft 583 is the third and last aircraft to be purchased to that Aircraft Sale and Purchase Agreement dated June 4, 2019. The total transaction value for the purchase of Aircraft 583 exceeded $10,000,000.*

On February 7, 2020, Contrail Aviation Leasing, LLC (“CAL”), a wholly-owned subsidiary of CAS (collectively, the “Subsidiaries”) sold one CFM56-7B22 engine with serial number 889727, which CAL previously leased. The transaction value exceeded $5,000,000.*

The purchase and sale as discussed above continues Contrail’s business of purchasing aircraft and/or aircraft engines for the purpose of leasing or disassembling them and selling them for parts.

The foregoing summary of the terms of the transaction documents does not purport to be complete and is qualified in its entirety by reference to the documents which are filed as Exhibit 10.1 and Exhibit 10.5 hereto and are incorporated by reference herein.

*Portions of the transaction exhibit have been omitted for confidential treatment.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

On February 3, 2020, the Subsidiaries, entered into Supplement #7 to Master Loan Agreement with Old National Bank (“ONB”). In connection therewith, the Subsidiaries entered into that certain Promissory Note Term Note F in the principal amount of $8,500,000 to ONB (“Term Note F”). The Term Note F has a maturity date of February 1, 2025, with a variable interest rate equal to the LIBOR rate plus 3.75% per year. There are additional affirmative covenants regarding quarterly cash flow coverage and tangible net worth. As collateral, ONB has a first position lien on two CFM56-7B22 aircraft engines with serial numbers 888798 and 889795 to that Aircraft Assets Security Agreement. The Company and CAL guaranty the borrower obligations for the Term Note F to the respective Continuing Guaranties dated June 24, 2019.

The foregoing summary of the terms of the Supplement #7 and Term Note F do not purport to be complete and is qualified in its entirety by reference to the documents which are filed as Exhibits 10.2, 10.3, and 10.4 respectively hereto and are incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits

AIR T INC Exhibit
EX-10.1 2 exhibit101-msn583billofsal.htm EXHIBIT 10.1 – MSN 583 BILL OF SALE AND ACCEPTANCE CERTIFICATE Exhibit BILL OF SALEBY THIS BILL OF SALE DIAMOND HEAD 2 (IRELAND) DAC (\”Seller\”) doeshereby sell,…
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About Air T, Inc. (NASDAQ:AIRT)

Air T, Inc. is a holding company. The Company operates through five segments: overnight air cargo, ground equipment sales, ground support services, printing equipment and maintenance, and leasing. The company’s overnight air cargo segment operates in the air express delivery services industry. The ground equipment sales segment manufactures and provides mobile deicers and other specialized equipment products to passenger and cargo airlines, airports, the United States military and industrial customers. The ground support services segment provides ground support equipment maintenance and facilities maintenance services to domestic airlines and aviation service providers. The printing equipment and maintenance segment designs, manufactures and sells advanced digital print production equipment, maintenance contracts, spare parts, supplies and consumable items for these systems. The Company’s leasing segment provides funding for equipment leasing transactions.