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FINANCING ARRANGEMENTS
 12 Months Ended
Mar. 31, 2022
Debt Disclosure [Abstract]  
FINANCING ARRANGEMENTS FINANCING ARRANGEMENTS
Borrowings of the Company and its subsidiaries are summarized below at March 31, 2022 and March 31, 2021, respectively.

On April 13, 2020, the Company entered into a loan with MBT in a principal amount of $8.2 million pursuant to a PPP Loan under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). As of March 31, 2022, the Company's PPP Loan was fully forgiven by the SBA. As such, the Company accounted for its then outstanding principal and accrued interest as a gain on extinguishment in accordance with ASC 470.

As mentioned in Note 2, on February 10, 2022, the Company acquired GdW, a Dutch holding company in the business of providing global aviation data and information. The acquisition was completed through a wholly-owned subsidiary of the Company, Air T Acquisition 22.1, a Minnesota limited liability company, through its Dutch subsidiary, Shanwick, and was funded with cash, investment by executive management of the underlying business, and loans as described below. As part of the transaction, Shanwick obtained a EUR 4.0 million loan package from ING Bank ("ING") to further fund this transaction. The ING loan package includes a EUR 3.0 million term loan (translated into $3.3 million Term Loan A - ING below) which carries an interest rate of 3.5% and a maturity date of February 1, 2027, and a EUR 1.0 million term loan (translated into $1.1 million Term Loan B - ING below) which carries an interest rate of 4% and a maturity date of May 1, 2027. The ING loan is non-recourse to the Company and Subsidiary and is secured by the shares of GdW.

The Company secured the funds necessary to fund its portion of the GdW acquisition consideration on February 8, 2022 through (i) a new secured loan from Bridgewater Bank ("Bridgewater"), a Minnesota banking corporation and (ii) cash. The loan is in the principal amount of $5.0 million and bears a fixed interest rate of 4.00%. The loan provides for monthly payments of accrued interest and annual principal payments of $0.5 million each for years 2023 through 2027, and matures on February 8, 2027 at which time the entire unpaid balance will be due and payable in full. In addition, the loan agreement contains affirmative and negative covenants. The loan is secured by a first lien on all of the assets of the Subsidiary, a pledge of $5.0 million 8.0% TruPs, and a personal guaranty of the Company’s Chairman, President and Chief Executive Officer Nicholas Swenson.

The following table provides certain information about the current financing arrangements of the Company's and its subsidiaries as of March 31, 2022 and 2021:

(In Thousands)March 31, 2022March 31, 2021Maturity DateInterest RateUnused commitments
Air T Debt
Revolver - MBT$10,969 $— 8/31/2023
Greater of 2.50% or Prime - 1.00%
$6,031 
Term Note A - MBT8,542 6,750 8/31/20313.42%
Term Note B - MBT3,014 3,375 8/31/20313.42%
Term Note D - MBT1,405 1,472 1/1/2028
1-month LIBOR + 2.00%
Term Note E - MBT2,316 4,706 6/25/2025
Greater of LIBOR + 1.50% or 2.50%
Debt - Trust Preferred Securities25,567 14,289 6/7/20498.00%
PPP Loan— 8,215 12/24/202211.00%
Total51,813 38,807 
AirCo 1 Debt
Term Loan - Park State Bank ("PSB")6,393 6,200 12/11/2025
3-month LIBOR + 3.00%
Total6,393 6,200 
Jet Yard Debt
Term Loan - MBT1,943 — 8/31/20314.14%
Total1,943 — 
Contrail Debt
Revolver - ONB3,843 — 9/5/2023
1-month LIBOR + 3.45%
21,157 
Term Loan G - ONB44,918 43,598 11/24/2025
1-month LIBOR + 3.00%
Term Loan H - ONB8,698 — 8/18/2023
Wall Street Journal (WSJ) Prime Rate + 0.75%
Total57,459 43,598 
Delphax Solutions Debt
Canadian Emergency Business Account Loan32 32 12/31/20255.00%
Total32 32 
Wolfe Lake Debt
Term Loan - Bridgewater9,837 — 12/2/20313.65%
Total9,837 — 
Air T Acquisition 22.1
Term Loan - Bridgewater5,000 — 2/8/20274.00%
Term Loan A - ING3,341 — 2/1/20273.50%
Term Loan B - ING1,114 — 5/1/20274.00%
Total9,455 — 
Total Debt136,932 88,637 
Less: Unamortized Debt Issuance Costs(1,124)(1,141)
Total Debt, net$135,808 $87,496 
Fiscal 2022's weighted average interest rate on short term borrowings outstanding was 3.90% . The weighted average interest rate on short term borrowings outstanding as of March 31, 2021 was 0.00%, due to the fact that all short-term borrowings outstanding as of March 31, 2021 have zero balances.
The Air T revolving credit facility and the Contrail revolving credit facility contain affirmative and negative covenants, including covenants that restrict the ability of the Company and its subsidiaries to, among other things, incur or guarantee indebtedness, incur liens, dispose of assets, engage in mergers and consolidations, make acquisitions or other investments, make changes in the nature of its business, and engage in transactions with affiliates.

The obligations of Contrail under the Contrail Credit Agreement with ONB are secured by a first-priority security interest in substantially all of the assets of Contrail. The obligations of Contrail under the Contrail Credit Agreement are also guaranteed by the Company, up to a maximum of $1.6 million, plus costs of collection. The Company is not liable for any other assets or liabilities of Contrail and there are no cross-default provisions with respect to Contrail’s debt in any of the Company’s debt agreements with MBT.
At March 31, 2022, our contractual financing obligations, including payments due by period, are as follows (in thousands):
Fiscal year endedAmount
2023$6,482 
202429,854 
202510,242 
202641,459 
20275,354 
Thereafter43,541 
136,932 
Less: Unamortized Debt Issuance Costs(1,124)
$135,808 
The Company assumes various financial obligations and commitments in the normal course of its operations and financing activities. Financial obligations are considered to represent known future cash payments that the Company is required to make under existing contractual arrangements such as debt and lease agreements.
Fair Value of Debts - As of March 31, 2022 and 2021, the carrying amounts reported in the consolidated balance sheets for the Company’s debt instruments approximate the fair values. Estimated fair values are determined by comparing current borrowing rates and risk spreads offered in the market (Level 2 fair value measures) or quoted market prices (Level 1 fair value measures), when available, to the stated interest rates and spreads on the Company’s debts.
Interest Expense, net - The components of net interest expense during the years ended March 31, 2022 and March 31, 2021 are as follows (in thousands):
March 31, 2022March 31, 2021
Contractual interest$4,808 $4,352 
Amortization of deferred financing costs367 288 
Interest income(227)(16)
Total$4,948 $4,624 

Other - On June 10, 2019, the Company completed a transaction with all holders of the Company’s Common Stock to receive a special, pro-rata distribution of the securities enumerated below:

•A dividend of one additional share for every two shares already held (a 50% stock dividend, or the equivalent of a 3-for-2 stock split). See Note 23.
•The Company issued and distributed to existing common shareholders, via a non-cash transaction from equity, an aggregate of 1.6 million trust preferred capital security shares (aggregate $4.0 million stated value) and an aggregate of 8.4 million warrants (representing warrants to purchase $21.0 million in stated value of TruPs).

On January 14, 2020, Air T effected a one-for-ten reverse split of its TruPs. As a result of the reverse split, the stated value of the TruPs currently is $25.00 per share. Further, each Warrant conferred upon its holder the right to purchase one-tenth of a share of TruPs for $2.40, representing a 4% discount to the new stated value of $2.50 for one-tenth of a share. As of March 31, 2022, approximately 5.3 million Warrants were exercised. The remaining 3.1 million Warrants were not exercised and expired on August 30, 2021.

During fiscal 2022, the Company received $8.5 million in gross proceeds from the sale of TruPs through a S-3 Registration Statement filed by the Company. The TruPs were sold and issued under the S-3 “shelf” Registration Statement base prospectus filed with the Securities and Exchange Commission on March 10, 2021 and declared effective by the SEC on March 19, 2021, and under an At the Market Offering Agreement and a First Amendment to the At the Market Offering Agreement filed with the SEC on May 14, 2021 and November 19, 2021, respectively, and prospectus supplements filed with the SEC on May 14, 2021 and November 19, 2021, respectively.

The amount outstanding on the Company's Debt - Trust Preferred Securities is $25.6 million as of March 31, 2022.