25.	SUBSEQUENT EVENTS

Management performs an evaluation of events that occur after a balance sheet date but before financial statements are issued or available to be issued for potential recognition or disclosure of such events in its financial statements. The Company evaluated subsequent events through the date that these consolidated financial statements were issued.

April 6, 2018,

the Company entered into an Asset Purchase Agreement with Worthington Aviation Parts, Inc., a Minnesota Corporation (“Worthington”), primarily engaged in the business of operating, distributing and selling airplane and aviation parts along with repair services, and Churchill Industries, Inc., a Minnesota corporation, as guarantor of Worthington’s obligations as disclosed in the Agreement, to acquire substantially all the assets of, and assume certain liabilities of Worthington in return for payment to Worthington of

$50,000

as earnest money upon execution of the Agreement and a payment of

$3,400,000

upon closing of the Agreement, subject to adjustment for Worthington’s net working capital as of the closing date. In connection with Amendment

No.

to the Asset Purchase Agreement, dated

May 2, 2018,

the cash purchase price was reduced by

$100,000

$3,300,000.

May 4, 2018,

the Company completed the acquisition.

May 25, 2018,

the Company’s wholly-owned subsidiaries Worthington Acquisition, LLC, Worthington Aviation, LLC and Worthington MRO, LLC, as Borrowers, completed a loan transaction with MBT pursuant to which Borrowers obtained from MBT a new revolving loan in the amount of up to

$1,500,000

(the “Revolving Loan”) and new term loan in the amount of

$3,400,000

(the “Term Loan” and together with the Revolving Loan, the “Loans”). The entire loan proceeds were disbursed by MBT on

May 25, 2018

and were used to reduce amounts previously advanced on the Company’s line of credit financing with MBT. Until the Term Loan is paid in full and certain other conditions met, the Company guaranteed up to

$3,000,000

of the Loans. The guaranty is thereafter reduced to

$1,500,000.

The interest rate on Term Loan floats at a rate equal to the

one

-month LIBOR rate plus

2.5%

and the interest rate on the Revolving Loan floats at a rate equal to the

one

-month LIBOR rate plus

2.0%.

The Loans mature on

November 30, 2019,

at which time the entire unpaid balance of the Loans will be due and payable in full. In addition, the loan agreement contains affirmative and negative covenants and the loans are secured by a

first

lien on all of the assets of the Borrowers and a pledge of certain assets held by Stratus Aero Partners, LLC, a subsidiary of the Company.