Exhibit 10.1

AMENDMENT NO. 1 TO CREDIT AGREEMENT

This AMENDMENT NO. 1 TO CREDIT AGREEMENT dated as of February 15, 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 (the “ Original Agreement ”).

B.      The Borrower has requested that the Lender amend the Original Agreement to increase the Term Loan D 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 definitions of the terms “Material Adverse Effect”, “Term Loan C Commitment” and “Term Loan D Commitment” defined in Section 1.01 of the Original Agreement are hereby amended in their respective entireties to read as follows:

“      ‘ Material Adverse Effect ’ means a material adverse effect on (a) the business, assets, properties, liabilities (actual or contingent), operations, condition (financial or otherwise) or prospects of the Borrower, individually, or the Borrower and its Subsidiaries taken as a whole (provided that for purposes of this clause (a) an event shall deemed to be “material” if it involves, or could be expected to involve, at least $5,000,000), (b) the validity or enforceability of any Loan Document, (c) the perfection or priority of any Lien purported to be created by any Loan Document, (d) the rights or remedies of the Lender under any Loan Document or (e) the ability of any Loan Party to perform any of its payment obligations under any Loan Document to which it is a party.

‘ Term Loan C Commitment ’: $1,000,000.00, and as the context may require, the agreement of the Bank to make Term Loan C to the Borrower up to the amount of the Term Loan C Commitment subject to the terms and conditions of this Agreement.

‘ Term Loan D Commitment ’ : $1,680,000.00, and as the context may require, the agreement of the Bank to make Term Loan D to the Borrower up to the amount of the Term Loan D Commitment subject to the terms and conditions of this Agreement. ”

(b)     Section 1.01 of the Original Agreement is hereby further amended by inserting the following new definitions of the terms “First Amendment”, and “First Amendment Effective Date” in the appropriate alphabetical order:

“‘ First Amendment ’: means that certain Amendment No. 1 to Credit Agreement dated as of February 15, 2015 executed by the Borrower and the Lender.

‘ First Amendment Effective Date ’: means the ‘Effective Date’ as defined in Section 3 of the First Amendment.”

(c)     Section 2.01(c) of the Original Agreement is hereby amended in its entirety to read as follows:

“      (c)     To make a loan (the “ Term Loan C ”) in the amount of the Term Loan C Commitment to the Borrower at the Lender’s principal office in Edina , Minnesota in immediately available funds on the First Amendment Effective Date. Proceeds of Term Loan C will be used to pay closing costs and to repay a portion of the outstanding principal balance of the Revolving Credit Loans.”

(d)     Section 2.01(d) of the Original Agreement is hereby amended by inserting the following new sentence at the end of such Section:

“Proceeds of Term Loan D will be used to pay closing costs and to repay a portion of the outstanding principal balance of the Revolving Credit Loans.”

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 Acknowledgment and Agreement, in the form provided by the Lender, duly executed by each Guarantor; and

(c)     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 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 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.

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 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.

(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.

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]

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

[signature page Amendment No. 1 to Credit Agreement]

Exhibit 10.2

TERM NOTE D

FOR VALUE RECEIVED, the undersigned, AIR T, INC. , a Delaware corporation (the “ Borrower ”), promises to pay to the order of MINNESOTA BANK & TRUST , a national banking association (the “ Lender ”), the principal sum of ONE MILLION SIX HUNDRED EIGHTY THOUSAND AND No/100 ^ths DOLLARS (U.S. $1,680,000.00) on or before January 1, 2028, or such earlier date as this promissory note (this “ Note ”) may be declared due and payable by Lender pursuant to the terms hereof and the terms of the Credit Agreement (the “ Maturity Date ”), together with interest on the principal amount thereof outstanding from time to time at the rate or rates described below, and any and all other amounts which may be due and payable hereunder or under any of the Loan Documents (as hereinafter defined) from time to time. This Note is made pursuant to the terms and conditions set forth in that certain Credit Agreement dated of even date herewith by and between Borrower and Lender (as amended, modified, supplemented or restated from time to time being the “ Credit Agreement ”). The amount disbursed by the Lender to Borrower, repayment of which is evidenced by this Note, is referred to as the “ Loan ”. All capitalized terms used and not expressly defined herein shall have the meanings given to such terms in the Loan Agreement.

Interest Prior to Default .

(a)       Interest Rate .

(i)     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 per annum rate of interest (the “ Interest Rate ”) that equals the sum of (a) the Index (as hereinafter defined), plus (b) 2.00% (the “ Margin ”).

(ii)     The interest rate on this Note is subject to change from time to time based on changes in an independent index which is LIBOR (as hereafter defined) adjusted and determined, without notice to Borrower, as of the date of this Note and on the first day of each calendar month hereafter (the “Interest Rate Change Date”). “LIBOR” shall mean the London Interbank Offered Rate of interest for an interest period of 1 month which appears on Bloomberg on the day that is two London Business Days preceding each Interest Rate Change Date (the “Reset Date”). If LIBOR as defined above is not available or is not published for any Reset Date, then Lender shall, at its sole discretion, choose a substitute source for LIBOR, which LIBOR plus the Margin, shall become effective on the next Interest Rate Change Date. “London Business Day” shall mean any day on which commercial banks in London, England are open for general business (collectively, the “Index”). The Index is not necessarily the lowest rate charged by Lender on its loans. If the Index becomes unavailable during the term of the Loan, Lender may designate a substitute Index after notice to Borrower. Lender will tell Borrower the current Index rate upon Borrower’s request. The interest rate change will not occur more often than each month. Borrower understands that Lender may make loans based on other rates as well. The Index currently is [_.____%] per annum. NOTICE: Under no circumstances will the interest rate on this Note be more than the maximum rate allowed by applicable law.

TERM NOTE D

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(b)      Prohibition on Making LIBOR Loans . If Lender shall have reasonably determined that the making or continuation of any LIBOR Loan has become prohibited or otherwise unlawful under any law, governmental rule, regulation or order of any governmental body, then Lender shall promptly give notice to Borrower of such determination. Upon delivery of such notice the Loan shall immediately commence bearing interest at, and the Loan Rate shall be converted to the Prime Rate (as defined herein) plus the Margin. The term “ Prime Rate ” means the “Prime Rate” as published in the “Money Rates” column of The Wall Street Journal as and when such rate changes (or, if The Wall Street Journal ceases to publish a rate so designated, any similar successor rate as the Lender shall in good faith designate). The Prime Rate is not necessarily the lowest rate charged to any customer), adjusted and changing immediately when and as said prime rate changes.

(c)      Change in Capital Adequacy Requirements . If Lender shall determine that the adoption after the date hereof (for purposes of this Agreement, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all guidelines and regulations adopted in connection therewith are deemed to have been adopted after the date hereof) of any applicable law, rule or regulation regarding capital adequacy, or any change in any existing law, rule or regulation regarding capital adequacy, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration of any such law, rule or regulation regarding capital adequacy, or compliance by Lender (or any of its branches) with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on Lender’s capital as a consequence of its obligations hereunder or for the credit which is the subject matter hereof to a level below that which Lender could have achieved but for such adoption, change or compliance (taking into consideration Lender’s policies with respect to liquidity and capital adequacy) by an amount deemed by Lender to be material, then from time to time, within fifteen (15) days after demand by Lender, Borrower shall pay to Lender such additional amount or amounts reasonably determined by Lender as will compensate Lender for such reduction.

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 ”; such increased rate of interest being the “ Default Rate ”). 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.

TERM NOTE D

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Payment Terms .

(a)      Principal and Interest . Payments of principal and interest due under this Note, if not sooner declared to be due in accordance with the provisions hereof, shall be made as follows (each such date when a payment is due and payable, a “ Payment Date ”):

(i)     On the first day of each month, commencing on March 1, 2018 and continuing until the Maturity Date, the Borrower shall make payments of principal, each in the amount of $5,600.00 plus accrued interest; and

(ii)     The Loan shall be due and payable, and Borrower hereby promises to pay the outstanding principal amount of the Loan to Lender, together with all accrued interest thereon then remaining unpaid and all other unpaid amounts, charges, fees and expenses outstanding under this Note or under any of the other Loan Documents, on the Maturity Date.

(iii)     THIS NOTE REQUIRES A BALLOON PAYMENT ON THE MATURITY DATE.

(b)      Method of 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.

Prepayment; Minimum Interest Charge . This Note may be prepaid in whole or in part at any time, so long as such prepayment is accompanied by a simultaneous payment of any applicable termination fees payable under any Hedge Agreement, plus accrued interest on the amount being prepaid through the date of prepayment. In any event, even upon full prepayment of this Note, Borrower understands that Lender is entitled to a minimum interest charge of $10.00. 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.

TERM NOTE D

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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 Term Note D referred to in, and is entitled to the benefits of, the Credit Agreement. The Credit Agreement, among other things, (i) 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; (ii) contains provisions for the mandatory prepayment hereof upon certain conditions; and (iii) contains provisions for the voluntary prepayment hereof, upon certain conditions.

Security Agreement . This Note is secured by, among other things, that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement dated of even date herewith executed by the Borrower for the benefit 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.

TERM NOTE D

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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 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.

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.

TERM NOTE D

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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.

TERM NOTE D

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IN WITNESS WHEREOF, the Borrower has caused this Term Note D 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.

Exhibit 10.3

AMENDED AND RESTATED TERM NOTE C

FOR VALUE RECEIVED, the undersigned, AIR T, INC. , a Delaware corporation (the “ Borrower ”), promises to pay to the order of MINNESOTA BANK & TRUST , a national banking association (the “ Lender ”), the principal sum of ONE MILLION AND No/100 ^ths DOLLARS (U.S. $1,000,000.00) together with interest thereon in:

(a)      consecutive monthly installments of principal each in the amount of $90,909.09 plus accrued interest, commencing March 1, 2018, and continuing through, to and including December 1, 2018; and

(c)      a final installment equal to the entire remaining principal balance hereof, and accrued, but unpaid interest thereon, shall be due and payable on January 1, 2019.

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 March 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 TERM NOTE C

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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 Term Note C 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) 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; (ii) contains provisions for the mandatory prepayment hereof upon certain conditions; and (iii) contains provisions for the voluntary prepayment hereof, upon certain conditions.

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.

AMENDED AND RESTATED TERM NOTE C

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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 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.

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.

AMENDED AND RESTATED TERM NOTE C

Page 4

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.

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.

AMENDED AND RESTATED TERM NOTE C

Page 5

Amendment and Restatement . This Note is being executed and delivered in restatement of, but not in payment of, that certain Term Note C dated December 21, 2017, made by the Borrower payable to the order of the Lender in the original principal amount of $1,900,000.00.

[signature page follows]

AMENDED AND RESTATED TERM NOTE C

Page 6

IN WITNESS WHEREOF, the Borrower has caused this Amended and Restated Term Note C 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.

Exhibit 10.4

Prepared By:

Daniel A. Merlin, Esq.

Alexander Ricks PLLC

4601 Park Road, Suite 580

Charlotte, NC 28209

After Recording Return to:

Frederick H. Ladner

Fabyanske, Westra, Hart & Thomson, P. A.

333 South Seventh Street, Suite 2600

Minneapolis, Minnesota 55402

ASSIGNMENT OF LEASES AND RENTS

THIS ASSIGNMENT is made as of the 15 ^th day of February, 2018 by AIR T, INC., a Delaware corporation (hereinafter called the “Borrower”), in favor of MINNESOTA BANK & TRUST, a Minnesota banking corporation (hereinafter called the “Lender”).

WITNESSETH :

WHEREAS , the Borrower and the Lender have entered into that certain Credit Agreement dated as of December 21, 2017, as amended by that certain Amendment No. 1 to Credit Agreement dated on or about the date hereof (as so amended and as it may be further amended, modified, restated or replaced from time to time, the “Credit Agreement”), pursuant to which the Lender has agreed, among other things, to make a term loan to the Borrower up to $1,680,000.00 (the “ Loan ”) to refinance existing indebtedness secured by the Subject Property (as hereinafter defined); unless the context otherwise indicates, capitalized terms not otherwise defined herein shall have the meanings specified in the Credit Agreement;

WHEREAS , in accordance with the Credit Agreement, the Borrower has executed and delivered its Term Note D of even date herewith, payable to Lender, in the principal amount of $1,680,000.00 (hereinafter, together with all amendments, modifications, extensions and renewals, called the “Note”);

WHEREAS , to secure payment and performance of the obligations of the Borrower under the Credit Agreement and the Note, the Borrower has executed and delivered to Fidelity National Title Insurance Company, as trustee for the benefit of the Lender, a Combination Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Financing Statement of even date herewith (hereinafter called the “Deed of Trust”), covering, inter alia , real estate situated in the City of Denver, County of Lincoln, State of North Carolina, legally described on Exhibit A attached hereto and hereby made a part hereof, and the buildings and improvements and furniture, fixtures, furnishings, equipment, machinery and personal property owned by the Borrower now or hereafter located thereon (hereinafter collectively called the “Subject Property”); and

WHEREAS , the Lender, as a condition to making the loan evidenced by the Note and the Credit Agreement, has required the execution of this Assignment.

NOW , THEREFORE , In consideration of the premises, and in further consideration of the sum of One Dollar ($1.00) paid by the Lender to the Borrower, the receipt and sufficiency of which are hereby acknowledged, the Borrower does hereby grant, transfer, set over, assign and deliver to the Lender all of the Borrower's right, title and interest in, to and under all leases, ground leases, subleases, licenses, concessions, tenancies, management agreements, operating agreements and any other agreements creating the right of possession or the right of use without a transfer of title, whether written or oral, now or hereafter existing, and covering all or any part of the Subject Property, together with any and all security deposits made thereunder, all extensions, amendments, modifications, renewals and replacements of any thereof, and any guaranties of the lessee's, ground lessee’s sublessee's, licensee's, concessionaire's, tenant's, user's, manager's or operator's (hereinafter collectively called “Lessees”) obligations under any thereof, each of said leases, ground leases, subleases, licenses, concessions, tenancies and agreements now existing and hereafter executed or entered, together with all such deposits, extensions, amendments, modifications, renewals, replacements and guaranties, being hereinafter collectively referred to as the “Leases”. In addition to the foregoing, the Borrower does further hereby grant, transfer, set over and assign to the Lender, and does hereby relinquish to the Lender all of the Borrower's right to collect and enjoy, all of the rents, income, revenues, royalties, issues and profits, including, without limitation, all amounts payable to the Borrower on account of maintenance, repairs, taxes, insurance and common area or other charges by any other party to any Lease, and all amounts paid in compromise or for cancellation of any Lease by any party thereto other than the Borrower, now or hereafter accruing or owing under or from Leases or otherwise from the Subject Property or any part thereof, whether accruing before or after foreclosure of the Deed of Trust or during any period of redemption therefrom (hereinafter collectively called “Rentals”). All of said Leases and Rentals are being hereby granted, transferred, set over and assigned for the purpose of facilitating the payment and performance of:

1.      The Borrower agrees to promptly, faithfully and diligently observe, perform and discharge each and every term, condition, obligation, covenant and agreement which the Borrower is now, or hereafter becomes, liable to observe, perform or discharge under the Note, the Deed of Trust and the Leases; to give prompt written notice to the Lender of any notice of default under any Lease on the part of the Borrower received from a Lessee thereunder, or on the part of any Lessee given by the Borrower thereunder, together with an accurate, complete copy of any such notice; and, at the sole cost and expense of the Borrower, to enforce or secure the performance of each and every obligation, covenant, condition and agreement to be performed by the Lessees under the Leases.

2.      The Borrower shall, at the Borrower's sole cost and expense, appear in and defend any dispute, action or proceeding arising under, growing out of or in any manner connected with or affecting any of the Leases or the obligations, duties or liabilities of the Borrower or any Lessee thereunder, and indemnify Lender against, and hold Lender harmless from and to pay all costs and expenses of the Lender, including attorneys' fees (prior to trial, at trial, and on appeal), in connection with any such dispute, action or proceeding in which the Lender may appear or with respect to which it may otherwise incur costs or expenses, whether or not the Lender prevails therein.

3.      Should the Borrower fail to make any payment or to do any act as herein provided, then the Lender may, but without obligation to do so, without notice or demand to or upon the Borrower, and without releasing the Borrower from any obligation hereof, make or do the same in such manner and to such extent as the Lender may deem necessary or desirable to protect the enforceability of this Assignment, including specifically, without limiting its general powers, appearing in and defending any action or proceeding purporting to affect the enforceability of this Assignment or the rights or powers of the Lender, and observing, performing and discharging all or any of the obligations, covenants and agreements of the Borrower in the Leases contained. In exercising any such powers, the Lender may pay its costs and expenses, employ counsel and incur and pay attorneys' fees (prior to trial, at trial and on appeal). The Borrower hereby grants to the Lender an irrevocable power of attorney, coupled with an interest, to perform all of the acts and things provided for in this section and in Section C.2 hereof as the Borrower's agent and in the Borrower's name.

4.      The Borrower agrees to reimburse the Lender, upon demand, for all sums expended by the Lender under the authority hereof, together with interest thereon at the Default Rate specified in the Note from the date expended, and the same shall be added to the indebtedness evidenced by the Note and shall be secured hereby and by the Deed of Trust.

5.      Until the Indebtedness Secured Hereby shall have been paid in full, the Borrower covenants and agrees not to enter into any Lease without the prior written approval thereof by the Lender, if the Lender ’s approval is required under the Credit Agreement, and, at Lender’s request, to provide the Lender with executed copies of all Leases, to assign to the Lender any and all subsequent Leases upon all or any part of the Subject Property upon the same or substantially the same terms and conditions as are herein contained, and to make, execute and deliver to the Lender, upon demand, any and all instruments that may be necessary or desirable therefor or otherwise effectuate the terms of this Assignment. The terms and conditions of this Assignment shall, however, apply to any such subsequent Leases, whether or not such instruments are executed or delivered by the Borrower.

6.      Except as permitted in the Credit Agreement, the Borrower agrees not to modify, amend, extend, waive or in any manner alter the terms of any Lease or reduce the Rental payable thereunder; not to waive, excuse or condone any default by a Lessee under a Lease; not to in any manner release or discharge any Lessee of or from any obligation, covenant, condition or agreement by said Lessee to be performed under a Lease, including the obligation to pay the Rental called for thereunder in the manner and at the places and times specified therein; not to grant any concession to a Lessee; not to cancel or terminate the term of any Lease or accept a surrender thereof; not to consent to any assignment or sublease by any Lessee of its rights under any Lease; and not to enter into any new Lease. During the existence of an Event of Default, the Borrower does by these presents expressly release, relinquish and surrender unto the Lender all of the Borrower's right, power and authority to modify, amend, extend, waive or in any manner alter the terms and provisions of the Leases, to reduce Rentals, to waive, excuse or condone a default by a Lessee, to release or discharge any Lessee, to grant concessions to any Lessee, to cancel or terminate the term of a Lease or to accept a surrender thereof, to consent to an assignment or a sublease by a Lessee, and to enter into any new Lease. Any attempt on the part of the Borrower to exercise any such right, power or authority, without the prior written consent of the Lender, shall be a nullity and shall be a default hereunder.

7.      Each Lease shall remain in full force and effect despite any merger of the interest of the Borrower and any Lessee thereunder; the Borrower shall not transfer fee title to the Subject Property to any Lessee, without the prior written consent of the Lender; and no such transfer shall relieve the Borrower of any liability to the Lender, unless the Lender specifically agrees otherwise in writing.

8.      The Borrower shall deliver to the Lender, promptly upon request by Lender a duly executed estoppel certificate from any Lessee, on Lender's form.

9.      The Borrower shall deliver to the Lender, promptly upon request by the Lender, all security deposits, including all applicable interest, held by the Borrower pursuant to the terms of the Leases, which the Lender shall hold and disburse in accordance with the terms of the Leases.

1.      The Borrower has good right and lawful authority to grant, transfer, set over and assign, and, other than the Deed of Trust, has not executed any prior assignment or alienation of its rights, title and interest in, to and under the Leases and to and in the Rentals, or otherwise encumbered the same.

2.      The Borrower has not performed or committed any act or executed any instrument, and is not bound by any law, statute, regulation, order, mortgage, deed of trust, indenture, contract or agreement, which might prevent the Lender from operating under any of the terms and conditions hereof, or which would limit the Lender in such operation.

3.      No Rental has been or will be paid by any Lessee, nor has been or will be collected or accepted by the Borrower, for more than one (1) month in advance, and the payment of none of the Rentals to accrue for any portion of the Subject Property has been or will be in any other manner anticipated, waived, released, excused, reduced, discounted, or otherwise discharged, altered or compromised by the Borrower. The Borrower hereby waives any right of set off against any person in possession of any portion of the Subject Property. The Borrower has not incurred and shall not incur any indebtedness to any Lessee.

4.      The Borrower has not executed or agreed to, shall not execute or agree to, and shall not permit to occur by operation of law any other assignment, alienation, pledge, encumbrance or transfer of any of its right, title or interest in, to or under the Leases or Rentals, except as provided for in the Deed of Trust.

5.      The Leases which have been executed on or before the date hereof are in full force and effect; the Leases have not been amended or modified; the Borrower has granted no concession and no waiver, release, reduction, postponement or alteration of rental to the Lessees under said other Leases; and there is no default now existing under the said Leases, nor has any event occurred which, with the passage of time and/or the giving of notice, would constitute a default thereunder.

6.      The Borrower shall not permit any of the Leases to become subordinate to any lien other than the liens hereof and of the Deed of Trust.

1.      This is a present, absolute, effective, irrevocable and completed assignment by the Borrower to the Lender of the Leases and Rentals and of the right to collect and apply the same, which is not contingent upon the Lender being in possession of the Subject Property. However, so long as no default exists in the performance of any obligation, covenant or agreement herein contained there exists no Event of Default under the Note, under the Deed of Trust, under the Credit Agreement, or under any other instrument which secures or refers to the Note (each such instrument, other than the Indemnity, is hereinafter called “Other Security Instrument”), and the Borrower shall have a conditional right to collect, but not more than two (2) months in advance, all Rentals from the Subject Property, in trust for the Lender, and to use the same for payment of Impositions (as that term is defined in the Deed of Trust), debt service, operating expenses, insurance premiums which the Borrower is required to pay under the Deed of Trust, all other costs and expenses which the Borrower is required to pay under and pursuant to the Note, to the Deed of Trust, to the Credit Agreement and to this Assignment, and the Indebtedness Secured Hereby, as and when due, before using said Rentals for any other purposes, and the excess only shall be the Borrower's absolute property.

2.      Upon or at any time after the occurrence of an Event of Default hereunder, under the Note, under the Deed of Trust, under the Credit Agreement or under any Other Security Instrument, the Borrower ’s conditional right to collect the Rentals as set forth above shall terminate and the Lender may, at its option, but without obligation to do so, without notice to or consent of the Borrower, either in person or by agent, without regard for the adequacy of the security for the Indebtedness Secured Hereby, the commission of waste or the solvency of the Borrower, with or without bringing any action or proceeding, or by a receiver or trustee to be appointed by a court, enter upon, take possession of, maintain, manage and operate the Subject Property, make, execute, enforce, modify, alter, cancel and accept the surrender of Leases (whether or not the same extend beyond the term of the Deed of Trust), obtain or evict tenants, fix or modify Rentals, refund and collect security deposits, and do any acts which the Lender deems proper to protect the security hereof, and either with or without taking possession of the Subject Property, in its own name or in the name of the Borrower, sue for or otherwise demand, collect, receive, and give receipts for all Rentals, and apply the same upon the costs of collection thereof, including the fees and costs of agents and attorneys employed by the Lender; upon the costs of managing, operating and leasing the Subject Property, including taxes, insurance, maintenance, repairs, improvements, the fees of professional managing agents, architects, engineers, and appraisers, license and permit fees, leasing fees and commissions, and the Lender's out-of-pocket expenses, and upon any Indebtedness Secured Hereby, in such order as the Lender may determine, subject to applicable statutory requirements, if any, and to the requirements of Section 1.13 of the Deed of Trust.

The Lender or such receiver or trustee shall be entitled to remain in possession of the Subject Property and to collect the Rentals throughout any statutory period of redemption from a foreclosure sale to the extent permitted by applicable law. The entering upon and taking possession of the Subject Property, the collection of such Rentals and the application thereof as aforesaid shall not cure or waive any Event of Default or waive, modify or affect any notice of default under the Note, under the Deed of Trust, under the Credit Agreement, under any Other Security Instrument or hereunder, or invalidate any act done pursuant to such Event of Default or notice of default. The Lender may, without entering into possession or pursuing any other remedy as provided in this section or at law or in equity, or in conjunction with such possession or pursuit of other remedy, give notice to any or all Lessees authorizing and directing said Lessees to pay Rentals directly to the Lender. If a Lessee receives such a notice, the Borrower hereby directs such Lessee to make payment pursuant thereto, and it shall be conclusively presumed, as between the Borrower and such Lessee, that the Lessee is obligated and entitled to make such payment to the Lender, and that such payment constitutes payment of Rentals under the Lease in question. Such notice may be given either in the Lender's or in the Borrower's name. The Borrower shall in every way facilitate the payment of Rentals to the Lender, when the Lender has the right to receive the same hereunder. The Lender shall be accountable only for Rentals actually collected hereunder and not for the rental value of the Subject Property. The Lender shall not be liable for any security deposit made by any Lessee unless and until the Lender comes into actual, physical possession and control thereof. Failure of the Lender to collect, or discontinuance by the Lender from collecting, at any time, and from time to time, any Rentals, shall not in any manner affect the rights of the Lender to thereafter collect the same.

The right of Lender to collect and receive the Rentals from, or possession of, the Subject Property, or to exercise any of the rights or powers granted herein to Lender shall, to the extent not prohibited by law, also extend to the period from and after the filing of any suit or the commencement of any non-judicial procedure to foreclose the lien of the Deed of Trust, and shall further extend to any period allowed by law for the redemption of the Subject Property after any foreclosure sale.

3.      The Lender shall have the right, under this Assignment, to take possession of and use, without rental or charge, any fixtures, equipment, furniture, appliances, personal property, books of account and records of the Borrower or its agents located in or constituting a part of the Subject Property in connection with the Lender's occupancy, management and operation of the Subject Property. The Lender shall be deemed to be the creditor of any Lessee in respect of any assignment for the benefit of creditors and any bankruptcy, arrangement, reorganization, insolvency, dissolution, receivership or other debtor-relief proceeding affecting such Lessee; provided, however, that the Lender shall not be obligated to file timely claims in such proceedings or to otherwise pursue any creditor's rights therein.

4.      The Lender shall not be deemed to be a partner of, or a joint venturer with, the Borrower with respect to the Subject Property or to be a participant of any kind in the management or operation of the Subject Property. The Lender shall not be obligated to perform or discharge, nor does it hereby undertake to perform or discharge, any obligation, duty or liability under any Lease, or with respect to the Subject Property or the inspection, maintenance or repair thereof, under or by reason of this Assignment, and the Borrower shall and does hereby agree to defend and indemnify the Lender against, and to hold it harmless from, any and all liability, loss or damage which the Lender may or might incur under the Leases, by reason of any death, personal injury or property damage occurring on or about the Subject Property, or otherwise under or by reason of this Assignment and against and from any and all claims and demand whatsoever which may be asserted against the Lender by reason of any alleged obligation or undertaking on its part to perform or discharge any of the terms, covenants or agreements contained in any Lease, or by reason of any such death, personal injury or property damage. Should the Lender incur any such liability, loss or damage under any Lease, by reason of any such death, personal injury or property damage, or under or by reason of this Assignment, or as a result of or in defending against any such claims or demands, the amount thereof, including costs, expenses and attorneys' fees (including such costs, expenses and fees prior to trial, at trial and on appeal), together with interest thereon at the Default Rate specified in the Note from the date incurred, shall be secured hereby and by the Deed of Trust, and the Borrower shall reimburse the Lender therefor immediately upon demand. Neither this Assignment, nor the exercise by the Lender of its rights hereunder, shall be deemed to constitute the Lender a mortgagee in possession of the Subject Property, unless the Lender elects in writing to be so constituted.

5.      If any Event of Default shall occur under the Note, under the Deed of Trust, under the Credit Agreement, under any Other Security Instrument or hereunder, or if any representation or warranty made by the Borrower to the Lender in connection with the Loan evidenced by the Note is untrue in any material respect, then the Lender may, at its option, declare all sums secured hereby immediately due and payable, and, in addition to making available to the Lender any remedies for default herein set forth, such Event of Default or breach of representation or warranty shall, at the Lender's sole option, constitute and be deemed to be an Event of Default under the Deed of Trust, entitling the Lender to every and all rights and remedies therein contained, in addition to those rights and remedies herein set forth, without regard to the adequacy of security for the Indebtedness Secured Hereby, the commission of waste or the insolvency of the Borrower.

6.      Upon the payment in full of all Indebtedness Secured Hereby, as evidenced by the recording or filing of any instrument of satisfaction or full release of the Deed of Trust, unless there shall have been recorded another mortgage or deed of trust in favor of the Lender covering all or any portion of the Subject Property, this Assignment shall become and be void and of no further effect.

7.      All rights, powers and remedies provided herein may be exercised only to the extent that the exercise thereof does not violate any applicable law, and they are intended to be limited to the extent necessary so that they will not render this Assignment invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable law. If any term of this Assignment shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the other terms hereof shall be in no way affected thereby. The Lender shall be entitled to all rights and remedies available hereunder, under the Note, under the Deed of Trust, under the Credit Agreement, under any Other Security Instrument, at law, in equity or under statute now and/or at the time of exercise thereof, even though such rights and remedies were not available on the date first above written, and all such rights and remedies may be exercised at any time and from time to time concurrently, separately, successively and in any order of preference, at the Lender's sole discretion.

8.      The covenants and agreements herein contained shall bind, and the rights hereunder shall inure to, the respective heirs, executors, administrators, personal representatives, legal representatives, successors and assigns of the Borrower and the Lender; provided, however, that nothing in this section is intended to be or shall be construed as a waiver of any of the rights of the Lender under the Deed of Trust.

9.      This Assignment is given in addition to the Deed of Trust, and not as part of the Deed of Trust. All rights and remedies herein conferred may be exercised whether or not foreclosure proceedings are pending under the Deed of Trust and, to the extent permitted by applicable law, during any statutory period of redemption. The Lender shall not be required to resort first to this Assignment or the Deed of Trust before resorting to the other, and the Lender may exercise its rights and remedies hereunder and under the Deed of Trust concurrently or independently and in any order of preference, all rights and remedies of the Lender set forth herein, in the Note, in the Deed of Trust, in the Credit Agreement, in the Other Security Instruments, at law, in equity, under statute and by contract being cumulative. No failure by the Lender to avail itself of any of the terms, covenants or conditions of this Assignment for any period of time shall be deemed to constitute a waiver thereof. The Lender shall have the right to assign the Borrower's rights, title and interests in, to and under any Leases and in and to the Rentals to any other or subsequent holder of the Note or any participant therein, or to any person, party or entity which acquires title to the Subject Property through foreclosure or otherwise, and any such assignees shall have all of the rights, remedies and powers provided to the Lender herein. All words and phrases used herein shall be construed to include the singular or plural number and the masculine, feminine or neuter gender, as may be appropriate under the circumstances.

10.      All notices, demands or documents which are required or permitted to be given or served hereunder shall be in writing, and shall be deemed given or served when personally delivered or when deposited in the U.S. Mail, registered or certified mail, return receipt requested, postage prepaid, or deposited with Federal Express, DHL or another reputable overnight courier, addressed as follows:

Each party hereto may change its above-stated address from time to time by serving written notice of the change upon the other party hereto as above provided at least ten (10) days prior to the effective date of said change.

11.      THE LAW OF THE STATE OF NORTH CAROLINA SHALL APPLY TO THE CREATION, ENFORCEMENT AND PERFECTION OF THE ASSIGNMENT SET FORTH HEREIN AND THE EXERCISE OF REMEDIES BY LENDER UNDER THIS ASSIGNMENT THAT PERTAIN TO OR CONCERN THE LEASES AND RENTS, INCLUDING, WITHOUT LIMITATION, THE APPOINTMENT OF A RECEIVER, THE ENFORCEMENT OF THE SECURITY INTEREST AND LIENS GRANTED HEREIN, WHETHER JUDICIALLY OR OTHERWISE. IN ALL OTHER RESPECTS, THE RIGHTS AND OBLIGATIONS OF LENDER WITH RESPECT TO THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW RULES AND PRINCIPLES OF SUCH STATE.

12.      BORROWER WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION RELATING TO OR ARISING FROM THIS ASSIGNMENT. AT THE OPTION OF LENDER, THIS ASSIGNMENT MAY BE ENFORCED IN ANY UNITED STATES DISTRICT COURT FOR THE DISTRICT IN WHICH THE SUBJECT PROPERTY IS LOCATED OR IN MINNEAPOLIS, MINNESOTA OR THE STATE COURT SITTING IN THE COUNTY IN WHICH THE SUBJECT PROPERTY IS LOCATED OR IN HENNEPIN COUNTY, MINNESOTA; BORROWER CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT JURISDICTION IN SUCH FORUMS IS NOT PROPER OR CONVENIENT OR 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 ASSIGNMENT, 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, BUT ANY APPLICABLE STATUTE OF LIMITATIONS SHALL CONTINUE TO BE TOLLED FOR A PERIOD OF SIX (6) MONTHS AFTER SUCH DISMISSAL.

13.      Borrower waives any right to require Lender to bring any action against any other person or to require that resort be had to any security or to any balances of any deposit or other accounts or debts or credits on the books of Borrower in favor of any other person; and, without limiting the foregoing, but in furtherance thereof, Borrower waives any rights Borrower otherwise might have or may have in the future under the provisions of North Carolina General Statutes Section 26-7, et seq. , as amended, and any other laws that require or may require Lender to recover against some other person, or to realize upon any collateral which Lender holds for the obligations secured hereby. Borrower also waives any and all right of subrogation, contribution, reimbursement and indemnity and any right of recourse to and with respect to the assets of any other person that is or may be security for the obligations secured hereby.

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IN WITNESS WHEREOF, the Borrower has caused this Assignment to be duly executed as to the day and year first above written.

The foregoing instrument was acknowledged before me this ___ day of February, 2018, by Candice L. Otey, the Secretary of AIR T, INC., a Delaware corporation, on behalf of the corporation.

EXHIBIT A

LEGAL DESCRIPTION

Exhibit 10.5

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 (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. 1 to Credit Agreement dated to be effective as of February 15, 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 February 15, 2018.

[Guarantor Acknowledgment and Agreement Signature Page]

[Guarantor Acknowledgment and Agreement Signature Page]