Exhibit 10.2

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT is made and entered into February 20, 2007, by and
between Willis Lease Finance Corporation, a Delaware corporation (“Employer”),
and Bradley S. Forsyth (“Employee”).

RECITALS

WHEREAS, Employee entered Employer’s employ on January 1, 2007 as Senior Vice
President and Chief Financial Officer.

WHEREAS, Employer desires that Employee continue to be employed by Employer in
the position, compensation, amenities and other benefits set forth herein;

WHEREAS, Employee desires to continue to be employed by Employer and in the
position of Senior Vice President and Chief Financial Officer on the terms and
conditions set forth herein; and

WHEREAS, Employee acknowledges that he has had an opportunity to consider this
Agreement and consult with independent advisors of his choosing with regard to
the terms of this Agreement, and enters this Agreement voluntarily and with a
full understanding of its terms.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing recitals, the mutual promises
of the parties and the mutual benefits they will gain by the performance
thereof, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as follows:

1.             Employment.  Employer hereby employs Employee and Employee hereby
accepts employment, upon the terms and conditions hereinafter set forth, as the
Senior Vice President and Chief Financial Officer of Employer.

2.             Term.

(a)           The term of Employee’s employment under this Agreement shall be
for a one year period commencing on January 1, 2007 and ending on December 31,
2007, (as may be extended hereunder, the “Employment Term”), unless otherwise
terminated pursuant to the terms hereof.  Each full twelve month period Employee
is employed by Employer shall be referred to herein as an “Employment Year.”

(b)           After the expiration of the initial Employment Term and until the
Termination Date (as defined below in Section 7), Employee’s employment will
automatically renew for a period of one year, each year, on the same terms and
conditions as are set forth herein, unless either party gives the other written
notice of nonrenewal at least twelve months prior to the end of the last
applicable Employment Year.  Employee shall be entitled to the

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payments set forth in Section 7 or Section 8 hereof in the event either party
gives the other such a notice of non-renewal.

(c)           Upon the occurrence of a Change in Control, this Agreement shall
be automatically extended for a period equal to the greater of: (I) the
remaining Employment Term, or (II) the eighteen month period commencing on the
date of the Change in Control event and ending on the eighteen month anniversary
of the Change in Control event (the “Change in Control Extension”).  “Change in
Control” means the occurrence of any of the following events: (i) any “person”
(as such term is used in Section 13(d) and 14(d) of the Securities Exchange Act
of 1934, as amended), other than Charles F. Willis, IV or an Affiliate (as
defined in Section 12) of Charles F. Willis, IV, is or becomes the “beneficial
owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of
securities of Employer representing at least fifty percent of the total voting
power represented by Employer’s then outstanding voting securities; or (ii) the
stockholders of Employer approve a merger or consolidation of Employer with any
other corporation, other than a merger or consolidation which would result in
the voting securities of Employer outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent of the
total voting power represented by the voting securities of Employer or such
surviving entity outstanding immediately after such a merger or consolidation,
or the stockholders of Employer approve a plan of complete liquidation or
dissolution of Employer or an agreement for the sale or disposition by Employer
of all or substantially all of Employer’s assets, provided, however, that if
such merger, consolidation, liquidation, dissolution, sale or disposition does
not subsequently close, a Change in Control shall not be deemed to have
occurred; or (iii) individuals who are directors of Employer as of the date
hereof cease for any reason to constitute a majority of Employer’s Board of
Directors (the “Board”) unless such change(s) is approved by a majority of the
directors of Employer as of the date thereof.

3.             Duties.

(a)           Employee shall in good faith perform those duties and functions as
are required by his position and such other duties as may be determined and
assigned to him from time to time by the Chief Operating Officer (“COO”) or
his/her designate(s).  Notwithstanding the foregoing or any other provision in
this Agreement, Employer shall have the right to modify from time to time the
title and duties assigned to Employee so long as such title and duties are
consistent with the usual and customary expectations of the type of position and
function of Employee.

(b)           Employee agrees to serve Employer faithfully and to the best of
his ability; to devote his full time and attention, with undivided loyalty,
during normal business hours to the business and affairs of Employer, except
during reasonable vacation periods and periods of illness and incapacity; and to
perform such duties as the COO or his/her designate(s) may assign, such duties
to be of a character and dignity appropriate to a Senior Vice President. 
Employee shall not engage in any other business or job activity during the
Employment Term without Employer’s prior written consent.  Notwithstanding the
foregoing, Employee may engage in civic and not-for-profit activities so long as
such activities do not materially interfere with Employee’s performance of his
duties hereunder.

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4.             Compensation.  Employer agrees to provide as compensation to
Employee the following salary, incentive, and benefits in exchange for the
services described in Section 3 of this Agreement:

(a)           Base Salary.  Employer agrees to pay to Employee during the
Employment Term an annual base salary in the amount of Two Hundred Thirty
Thousand Dollars ($230,000) per Employment Year less payroll deductions and all
required withholdings, or such higher amount as the Compensation Committee of
the Board shall from time to time determine.  Employee’s base salary shall be
paid not less frequently than semi-monthly in accordance with Employer’s usual
payroll practices.  The Compensation Committee of the Board will review
Employee’s base salary no less than once annually, and shall have sole
discretion to increase or decrease (subject to the next sentence hereof) the
base salary.  Employee’s base salary only may be decreased in connection with a
salary reduction program approved by the Compensation Committee of the Board,
which affects all executive officers of Employer.

(b)           Incentive Compensation.  In addition to Employee’s base salary,
Employee shall participate in and, to the extent earned or otherwise payable
thereunder, receive periodic incentive cash bonuses pursuant to any incentive
plans currently maintained or hereafter established by Employer and applicable
to an employee of Employee’s position.  Employee’s entitlement to incentive
bonuses is discretionary and shall be determined by the Compensation Committee
of the Board in good faith based upon the extent to which Employee’s individual
performance objectives and Employer’s performance objectives were achieved
during the applicable bonus period.  Employee is eligible to receive a target
bonus of up to 60% of Employee’s base salary (“Incentive Bonus”).  The
Compensation Committee of the Board will annually set the Employer’s performance
targets and approve the incentive compensation plan.

5.             Benefits and Prerequisites.

(a)           Benefits.   Employer shall provide Employee such employment
benefits, equipment and support as are generally available to executive officers
of Employer, including without limitation reimbursement of reasonable expenses
incurred in performing his duties under this Agreement (including, but not
limited to, expenses for entertainment, long distance telephone calls, lodging,
meals, transportation and travel), coverage under medical, dental, long-term
disability and group life insurance plans, and rights and benefits for which
Employee is eligible under Employer’s 401(k) and employee stock purchase plans.

(b)           Vacation and Sick Pay.  Employee shall be eligible for vacation
and sick leave in accordance with the policies of Employer in effect from time
to time during the Employment Term.  Employee shall be entitled to a period of
annual vacation time equal to four weeks during each Employment Year, to accrue
pro rata during the course of the Employment Term.  All accrued vacation and
sick pay shall be paid to Employee in a lump sum payment on the date of a Change
in Control or termination of employment with Employer.

(c)           Stock Appreciation Award.  In addition to the Incentive Bonus
described in Section 4(b), Employer will grant Employee 20,000 incentive bonus
units based upon the appreciation in the value of Employer’s common stock over a
one-year period under an Agreement substantially in the form of Exhibit A
attached hereto.

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6.             Relocation Reimbursement.  Employer shall reimburse Employee in
the amount of $50,000 for Employee’s expenses incurred in connection with his
relocation to Sausalito, California.

7.             Termination/Nonrenewal by Employer.  The date on which Employee’s
employment by Employer ceases, under any of the following circumstances, shall
be defined herein as the “Termination Date.”  The employment of Employee may be
terminated by Employer or Employer may decide not to renew this Agreement for
any reason or no reason, with or without cause or justification, subject to the
following:

(a)           Termination For Cause.  If (i) Employee’s employment is terminated
by Employer for Cause (as defined below), or (ii) Employer gives Employee a
notice of nonrenewal pursuant to Section 2(b) hereof for Cause, Employer’s total
liability to Employee or his heirs shall be limited to payment of any unpaid
base salary and any annual incentive compensation to which Employee is entitled
as of the Termination Date, and accrued vacation and sick pay, and Employee
shall not be entitled to any further compensation or benefits provided under
this Agreement, including, without limitation, any severance payments.  “Cause”
includes, but shall not be limited to:  (1) Employee’s conviction of or plea of
nolo contendere to any felony or gross misdemeanor charges brought in any court
of competent jurisdiction; (2) any fraud, misrepresentation or gross misconduct
by Employee against Employer; and (3) Employee’s breach of this Agreement.

(b)           Termination Without Cause.  If (i) Employee’s employment is
terminated by Employer without Cause, or (ii) Employer provides Employee with a
notice of nonrenewal pursuant to Section 2(b) hereof without Cause, Employer
will (A) in the case of termination, provide not less than twelve months notice
of termination or an amount equal to twelve months of Employee’s base salary in
lieu of notice, or (B) in the case of nonrenewal, provide notice of nonrenewal
at least twelve months prior to the end of the last applicable Employment Year
or an amount equal to twelve months base salary in lieu of notice.  In addition,
in each of the foregoing scenarios, Employee will be paid the severance which is
described in Section 9 below.

8.             Termination/Nonrenewal by Employee.  The employment of Employee
may be terminated by Employee or Employee may decide not to renew this Agreement
for any reason or no reason, with or without cause or justification, subject to
the following:

(a)           Voluntary Resignation.  If (i) Employee’s employment terminates by
reason of Employee’s voluntary resignation (and is not a resignation for Good
Reason), or (ii) Employee gives Employer a notice of nonrenewal pursuant to
Section 2(b) hereof (which is not given for Good Reason), Employer’s total
liability to Employee shall be limited to payment of any unpaid base salary and
any annual incentive compensation to which Employee is entitled as of the
Termination Date, and accrued vacation and sick pay, and Employee shall not be
entitled to any further compensation or benefits provided under this Agreement,
including, without limitation, any severance payments.

(b)           Resignation for Good Reason.  If (i) Employee’s employment
terminates by reason of Employee’s voluntary resignation for Good Reason, or
(ii) Employee provides Employer with a notice of nonrenewal pursuant to Section
2(b) hereof for Good Reason,

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Employee will be paid the severance which is described in Section 9 below. 
“Good Reason” means:  Employee’s voluntary termination following (i) a reduction
in compensation which is not in proportion to any salary reduction program
approved by the Compensation Committee of the Board which affects all executive
officers of Employer; (ii) a reduction in material benefits; (iii) a material
reduction in Employee’s position, title, duties and status; (iv) requiring
Employee to work at a location more than 25 “road” miles from the location of
Employer’s corporate headquarters as of the date of this Agreement; or (v) any
willful and material breach by Employer of its obligations under this Agreement.

9.             Severance Payment.

(a)           Amount.  In the event severance is payable hereunder, such
severance shall be in an amount equal to

(i)            one times Employee’s annual base salary at the time of
termination, pursuant to Section 7(b) or Section 8(b), or if during a Change in
Control Extension, one and one half times Employee’s base salary at the time of
termination, plus

 (ii)          any unpaid base salary and any annual incentive compensation to
which Employee is entitled as of the Termination Date, and accrued vacation and
sick pay, plus

(iii)          if during a Change in Control Extension, an amount equal to the
average annual incentives paid to Employee attributable to the two years prior
to the year of termination, plus

(iv)          accelerated vesting of any stock options scheduled to vest during
the two years following the Termination Date, plus

(v)           distribution of unpaid deferred compensation, plus

 (vi)         continued coverage under all group benefit plans (e.g., medical,
dental and life insurance) for a period of twelve months following the
Termination Date, or if during a Change in Control Extension, for a period of
eighteen months following the Termination Date, in each case at the same cost to
Employee as prior to the Termination Date.

(b)           Payment.  All cash components of the above-described severance
payments, other than annual incentive compensation, shall be paid in a lump sum
within thirty days of the date of termination of Employee’s employment; provided
that, only to the extent required by Section 409A of the Code, such payments
shall be made in a lump sum six months after the date of termination.  Payment
of annual incentive, which may be due under a Bonus Plan but which has not yet
been determined, shall be paid at the time payments are made to other
participants under such Bonus Plan.

(c)           Limitation on Payments.  If any payment or benefit Employee would
receive from Employer or otherwise (“Payment”) would (i) constitute a “parachute
payment” within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the

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“Code”), and (ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then such Payment shall be reduced
to the Reduced Amount.  The “Reduced Amount” shall be either (x) the largest
portion of the Payment that would result in no portion of the Payment being
subject to the Excise Tax or (y) the largest portion, up to and including the
total, of the Payment, whichever amount, after taking into account all
applicable federal, state and local employment taxes, income taxes, and the
Excise Tax (all computed at the highest applicable marginal rate), results in
Employee’s receipt, on an after-tax basis, of the greater amount of the Payment
notwithstanding that all or some portion of the Payment may be subject to the
Excise Tax.  If a reduction in payments or benefits constituting “parachute
payments” is necessary so that the Payment equals the Reduced Amount, reduction
shall occur in the following order unless Employee elects in writing a different
order (provided, however, that such election shall be subject to Company
approval if made on or after the date on which the event that triggers the
Payment occurs):  reduction of cash payments; cancellation of accelerated
vesting of stock awards; and reduction of employee benefits.  In the event that
acceleration of vesting of stock award compensation is to be reduced, such
acceleration of vesting shall be cancelled in the reverse order of the date of
grant of Employee’s stock awards unless Employee elects in writing a different
order for cancellation.

The accounting firm engaged by Employer for general audit purposes as of the day
prior to the effective date of the event that triggers the Payment shall perform
the foregoing calculations.  If the accounting firm so engaged by Employer is
serving as accountant or auditor for the individual, entity or group effecting
the “change in ownership” as described in Section 280G(b)(2)(A)(i) of the Code,
Employer shall appoint a nationally recognized accounting firm to make the
determinations required hereunder.  Employer shall bear all expenses with
respect to the determinations by such accounting firm required to be made
hereunder.

The accounting firm engaged to make the determinations hereunder shall provide
its calculations, together with detailed supporting documentation, to Employer
and Employee within fifteen (15) calendar days after the date on which
Employee’s right to a Payment is triggered (if requested at that time by
Employer or Employee) or such other time as requested by Employer or Employee. 
If the accounting firm determines that no Excise Tax is payable with respect to
a Payment, either before or after the application of the Reduced Amount, it
shall furnish Employer and Employee with an opinion reasonably acceptable to
Employee that no Excise Tax will be imposed with respect to such Payment.  Any
good faith determinations of the accounting firm made hereunder shall be final,
binding and conclusive upon Employer and Employee.

10.           Benefits Upon Termination.  Except as otherwise expressly provided
by this Agreement and without limiting any rights granted to Employee hereunder,
all insurance benefits provided under Section 5 of this Agreement shall be
extended, at Employee’s election and cost, to the extent permitted by Employer’s
insurance policies and benefit plans, for one year after Employee’s Termination
Date, except (a) as required by law (e.g., COBRA health insurance continuation
election) or (b) in the event of a termination described in Section 7 or 8.

11.           Death/Disability.

(a)           In the event (during the Employment Term) of Employee’s death,
(i) this Agreement shall terminate, (ii) Employer shall pay to Employee’s estate
or heirs any unpaid base

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salary and any annual incentive compensation to which Employee may be entitled
as of the Termination Date, and (iii) Employee’s estate and heirs shall not be
entitled to any severance payments hereunder.  In addition, the stock options
scheduled to vest during the two (2) years following the date of Employee’s
death shall receive accelerated vesting and shall become exercisable upon
Employee’s death.  Employee’s estate shall have the right to exercise such
options for the shorter of (i) two years from the date of death, and (ii) the
term of the option.

(b)           In the event (during the Employment Term) of Employee’s long term
disability (as defined in Employee’s Group Disability Plan) and the passing of
the Elimination Period (as defined in Employee’s Group Disability Plan),
(i) this Agreement shall terminate, (ii) Employer shall pay to Employee any
unpaid base salary and any annual incentive compensation to which Employee is
entitled as of the Termination Date, and (iii) Employee shall not be entitled to
any severance payments hereunder.  In addition, the stock options scheduled to
vest during the two years after the date of Employee’s disability shall receive
accelerated vesting and shall become exercisable upon the termination of this
Agreement due to Employee’s disability.  Employee shall have the right to
exercise such options for the shorter of (i) two years from the date of
disability, and (ii) the term of the option.

12.           Maintenance of Confidentiality and Duty of Loyalty.

(a)           General.  Employee acknowledges that, pursuant to his employment
with Employer, he will necessarily have access to trade secrets and information
that is confidential and proprietary to Employer in connection with the
performance of his duties.  In consideration for the disclosure to Employee of,
and the grant to Employee of access to such valuable and confidential
information and in consideration of his employment, Employee shall comply in all
respects with the provisions of this Section 12.

(b)           Nondisclosure.  During the Employment Term and for a period of
three years thereafter, Confidential and Proprietary Information of Employer of
which Employee gains knowledge during the Employment Term shall be used by
Employee only for the benefit of Employer in connection with Employee’s
performance of his employment duties, and Employee shall not, and shall not
allow any other person that gains access to such information in any manner to,
without the prior written consent of Employer, disclose, communicate, divulge or
otherwise make available, or use, any such information, other than for the
immediate benefit of Employer.  For purposes of this Agreement, the term
“Confidential and Proprietary Information” means information not generally known
to the public and which is proprietary to Employer and relates to Employer’s
existing or reasonably foreseeable business or operations, including but not
limited to trade secrets, business plans, advertising or public relations
strategies, financial information, budgets, personnel information, customer
information and lists, and information pertaining to research, development,
manufacturing, engineering, processing, product designs (whether or not patented
or patentable), purchasing and licensing, and which may be embodied in reports
or other writings or in blue prints or in other tangible forms such as equipment
and models.  Employee will refrain from any acts or omissions that would
jeopardize the confidentiality or reduce the value of any Employer Confidential
and Proprietary Information.

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(c)           Covenant of Loyalty.  During the Employment Term, Employee shall
not, on his own account or as an employee, agent, promoter, consultant, partner,
officer, director, or as a more than 1% shareholder of any other person, firm,
entity, partnership or corporation, own, operate, lease, franchise, conduct,
engage in, be connected with, have any interest in, or assist any person or
entity engaged in any business in the continental United States that is in any
way competitive with or similar to the business that is conducted by Employer or
is in the same general field or industry as Employer.  Without limiting the
generality of the foregoing, Employee does hereby covenant that he will not,
during the Employment Term:

(i)            solicit, accept or receive any compensation from any customer of
Employer or any business competitive to that of Employer; or

(ii)           contact, solicit or call upon any customer or supplier of
Employer on behalf of any person or entity other than Employer for the purpose
of selling, providing or performing any services of the type normally provided
or performed by Employer; or

(iii)          induce or attempt to induce any person or entity to curtail or
cancel any business or contracts which such person or entity has with Employer;
or

(iv)          induce or attempt to induce any person or entity to terminate,
cancel or breach any contract which such person or entity has with Employer, or
receive or accept any benefits from such termination, cancellation or breach.

(d)           No Solicitation.  During the Employment Term and for a period of
two years thereafter, Employee agrees not to interfere with the business of
Employer or any Affiliate of Employer by directly or indirectly soliciting,
attempting to solicit, inducing or otherwise causing any employee of Employer or
any Affiliate of Employer to terminate his or her employment with Employer in
order to become an employee, consultant or independent contractor to or for any
other person or entity.

(e)           Injunctive Relief.  Employee expressly agrees that the covenants
set forth in this Section 12 are reasonable and necessary to protect Employer
and its legitimate business interests, and to prevent the unauthorized
dissemination of Confidential and Proprietary Information to competitors of
Employer.  Employee also agrees that Employer will be irreparably harmed and
that damages alone cannot adequately compensate Employer if there is a violation
of this Section 12 by Employee, and that injunctive relief against Employee is
essential for the protection of Employer.  Therefore, in the event of any such
breach, it is agreed that, in addition to any other remedies available, Employer
shall be entitled as a matter of right to injunctive relief in any court of
competent jurisdiction, plus attorneys’ fees actually incurred in seeking such
relief.  Furthermore, Employee agrees that Employer shall not be required to
post a bond or other collateral security with the court if Employer seeks
injunctive relief.  To the extent any provision of this Section 12 is deemed
unenforceable by virtue of its scope or limitation, Employee and Employer agree
that the scope and limitation provisions shall nevertheless be enforceable to
the fullest extent permissible under the laws and public policies applied in
such jurisdiction where enforcement is sought.

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13.           Affiliate.  “Affiliate” means a person that, directly or
indirectly, through one or more intermediaries controls, is controlled by or is
under common control with the first mentioned person.

14.           Notices.  Any notice which either party may wish or be required to
give to the other party pursuant to this Agreement shall be in writing and shall
be either personally served or deposited in the United States mail, registered
or certified, and with proper postage prepaid.  Mailed notices to Employee shall
be addressed to Employee at the home address which Employee most recently
communicated to Employer in writing.  In the case of Employer, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be
directed to the attention of corporate counsel.  Notice given by personal
service shall be deemed effective upon service.  Notice given by registered or
certified mail shall be deemed effective three (3) days after deposit in the
mail.

15.           Binding Effect.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto, their respective legal representatives, and
their successors and assigns.  As used in this Agreement, the term “successor”
shall include any person, firm, corporation or other business entity which at
any time, whether by merger, purchase, consolidation, or otherwise, acquired all
or substantially all of the assets or business of Employer.  This Agreement
shall be deemed to be willfully breached by Employer if any such successor does
not absolutely and unconditionally assume all of Employer’s obligations under
this Agreement and agree expressly to perform the obligations in the same manner
and to the same extent as Employer would be required to perform such obligations
in the absence of the succession.  Employee may not assign any of his duties
hereunder and he may not assign any of his rights hereunder without the written
consent of Employer, which shall not be unreasonably withheld.

16.           Entire Agreement.  This Agreement contains the entire agreement of
the parties and supersedes and replaces all prior agreements and understandings
between the parties relating to the subject matter hereof.

17.           Governing Law.  This Agreement shall be governed by and construed
in accordance with the internal laws (without reference to choice or conflict of
laws) of the State of California.

18.           Arbitration.  Employer and Employee agree that, to the extent
permitted by law and to the extent that the enforceability of this Agreement is
not thereby impaired, any and all disputes, controversies or claims between
Employee and Employer, except disputes concerning the use or disclosure of trade
secrets, proprietary and/or confidential information, or otherwise arising under
Section 12 hereof, shall be determined exclusively by final and binding
arbitration in the County of San Francisco, California, in accordance with the
employment rules of the American Arbitration Association then in effect.  The
controversy or claim shall be submitted to three arbitrators, one of whom shall
be chosen by Employer, one of whom shall be chosen by Employee, and the third of
whom shall be chosen by the two arbitrators so selected.  The party desiring
arbitration shall give written notice to the other party of its desire to
arbitrate the particular matter in question, naming the arbitrator selected by
it.  If the other party shall fail within a period of 15 days after such notice
shall have been given to reply in writing naming the arbitrator selected by it,
then the party not in default may apply to the American Arbitration

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Association for the appointment of the second arbitrator.  If the two
arbitrators chosen as above shall fail within 15 days after their selection to
agree upon a third arbitrator, then either party may apply to the American
Arbitration Association for the appointment of an arbitrator to fill the place
so remaining vacant.  Employer shall pay the fees of the arbitrators so
selected.  The decision of any two of the arbitrators shall be final and binding
upon the parties hereto and shall be delivered in writing signed in triplicate
by the concurring arbitrators to each of the parties hereto.  The parties agree
that both parties will be allowed to engage in adequate discovery consistent
with the nature of the claims in dispute.  The arbitrators shall have the
authority to entertain a motion to dismiss and/or a motion for summary judgment
by any party and shall apply the standards governing such motions under the
Federal Rules of Civil Procedure.  The arbitrators shall have discretion to
award monetary and other damages, or no damages, and to fashion such other
relief as the arbitrators deem appropriate.  The arbitrators also shall have
discretion to award the prevailing party reasonable costs and attorneys’ fees
incurred in bringing or defending an action under this Section 18, as permitted
by applicable law.  Judgment on the award rendered by the arbitrators may be
entered in any court having jurisdiction.

Nothing in this Section 18 shall limit the Employer’s ability to seek injunctive
relief for any violation of Employee’s obligations concerning nondisclosure,
loyalty and nonsolicitation as set forth in Section 12 hereof.  Any such
injunctive relief proceeding shall be without prejudice to any rights Employer
or Employee may have under this Agreement to obtain relief in arbitration with
respect to such matters.

19.           Severability.  Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.

20.           Amendments and Waivers.  This Agreement may be modified only by a
written instrument duly executed by each party hereto.  No breach of any
covenant, agreement, warranty or representation shall be deemed waived unless
expressly waived in writing by the party who might assert such breach.  No
waiver of any right hereunder shall operate as a waiver of any other right or of
the same or a similar right on another occasion.

21.           Counterparts.  This Agreement may be executed by the parties in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.

22.           Section Headings.  The headings of each Section, subsection or
other subdivision of this Agreement are for reference only and shall not limit
or control the meaning thereof.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.

“Employer”

 

 

 

WILLIS LEASE FINANCE CORPORATION

 

 

 

 

 

By:

/s/ Lee G. Beaumont

 

 

Lee G. Beaumont

 

 

Chief Operating Officer

 

 

 

 

 

 

 

“Employee”

 

 

 

By:

/s/ Bradley S. Forsyth

 

 

Bradley S. Forsyth

 

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Exhibit A

WILLIS LEASE FINANCE CORPORATION
INCENTIVE BONUS AGREEMENT

THIS INCENTIVE BONUS AGREEMENT (this “Agreement”) is made and entered into
February 20, 2007 (the “Grant Date”) by and between Willis Lease Finance
Corporation, a Delaware corporation (the “Company”), and Bradley S. Forsyth
(“Executive”).

RECITALS

WHEREAS, the Compensation Committee of the Board of Directors of the Company
(the “Committee”) desires to grant to Executive an incentive bonus award
pursuant to the terms and conditions of this Agreement, the value of which is
based upon the appreciation in the value of the Company’s common stock (the
“Common Stock”) over a specified period of time; and

WHEREAS, Executive desires to accept such award subject to the terms and
conditions of this Agreement.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and
agreements contained herein, the Company and Executive, intending to be legally
bound, hereby agree as follows:

1.             Grant.

(a)           The Company hereby grants to Executive an award of 20,000
incentive bonus units (the “Award”), subject to the terms and conditions set
forth herein.  Each incentive bonus unit represents the right to receive from
the Company on the Settlement Date (as defined below) a cash payment equal to
the Settlement Value (as defined below).

(b)           For purposes of this Agreement, the term “Settlement Date” shall
mean either (i) the first anniversary of the Grant Date or (ii) in the event
that prior to the first anniversary of the Grant Date the vesting of the Award
is accelerated pursuant to Section 5(c)(i) or Section 5(c)(iii) hereof, the
effective date of the Corporate Transaction or Change in Control (each as
defined below).

(c)           For purposes of this Agreement, the term “Settlement Value” shall
mean:

(i)            if the Settlement Date is not the effective date of a Corporate
Transaction or Change in Control, the excess, if any, of the Fair Market Value
(as defined below) on the Settlement Date of one share of the Common Stock
(subject to adjustment as set forth in Section 5 hereof) over the Base Price (as
defined below) or

(ii)           if the Settlement Date is the effective date of a Corporate
Transaction and/or Change in Control, the excess of the total value (as
determined by the Committee) of all consideration payable in respect of one
share of the Common Stock (subject to adjustment as set forth in Section 5
hereof) in the Corporate Transaction over the Base Price.

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(d)           For purposes of this Agreement, the term “Fair Market Value” on
any date shall mean the closing price per share of Common Stock on the date in
question, as the price is reported by the NASDAQ Global Market or any successor
system; provided, however, if there is no closing price for the Common Stock on
the date in question, then the Fair Market Value shall be the closing price on
the last preceding date for which such quotation exists.

(e)           For purposes of this Agreement, the term “Base Price” shall mean
the Fair Market Value of one share of the Common Stock on January 1, 2007
(subject to adjustment pursuant to Section 5 hereof).

2.             Vesting; Settlement.  The Award shall vest and become
nonforfeitable on the Settlement Date, subject to Executive’s continuous
employment with the Company through the Settlement Date.  So long as Executive
remains continuously employed by the Company through the Settlement Date, within
the first payroll cycle of the Company following the Settlement Date, Executive
will be entitled to receive a cash payment from the Company equal to the
Settlement Value multiplied by the number of incentive bonus units subject to
the Award as set forth in Section 1(a) hereof, less any applicable tax
withholdings as described in Section 7 hereof.  Executive acknowledges and
agrees that if, on the Settlement Date, the Fair Market Value of the Common
Stock is less than or equal to the Base Price, the Award shall be forfeited
without consideration.

3.             Status of Executive.  Executive shall not have any rights to
receive shares of Common Stock pursuant to the Award, nor shall Executive have
any rights as a stockholder with respect to any shares of Common Stock as a
result of the Award.

4.             Termination of Employment.  Except as otherwise provided in this
Section 7, the Award shall automatically terminate without receipt of
consideration by Executive in the event that Executive’s employment with the
Company terminates for any reason prior to the Settlement Date.

5.             Certain Transactions and Events.

(a)           In General.  Except as provided in this Section 5, no change in
the capital structure of the Company, merger, consolidation, other corporate
reorganization or reclassification, sale or other disposition of assets of the
Company, sale or other disposition of a subsidiary or operating division or
other portion of the Company, change in control of the ownership of Company or a
subsidiary or affiliate of the Company, issuance by the Company of shares of any
class of securities or securities convertible into shares of any class of
securities, exchange or conversion of securities, or other transaction or event
shall require or be the occasion for any adjustments of the type described in
this Section 5.  In addition, the existence of the Award shall in no way limit,
restrict or otherwise affect the right of the Company to adjust, reclassify,
reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or otherwise dispose of, transfer or
augment all or any part of its business or assets.

(b)           Changes in Capital Structure.  If any change is made to the Common
Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of

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shares or other change affecting the outstanding Common Stock as a class without
the Company’s receipt of consideration, appropriate adjustments shall be made by
the Committee to the number and/or class of securities with respect to which the
Award is granted and the Base Price.  Such adjustments are to be effected in a
manner which shall preclude the enlargement or dilution of rights and benefits
under the Award.

(c)           Corporate Transaction.

(i)            In the event of any Corporate Transaction, the vesting and
settlement of the Award shall automatically accelerate so that the Award shall,
immediately prior to the effective date of the Corporate Transaction, become
fully vested.  However, the vesting and settlement of the Award shall not so
accelerate if and to the extent: (i) the Award is, in connection with the
Corporate Transaction, either to be assumed by the successor corporation (or
parent thereof) or to be replaced with a comparable cash incentive right with
respect to shares of the capital stock of the successor corporation (or parent
thereof) or (ii) the Award is to be replaced with another cash incentive program
of the successor corporation which preserves the Settlement Value as determined
at the time of the Corporate Transaction and provides for subsequent payout in
accordance with the same payment schedule set forth above.  The determination of
award comparability under clause (i) or (ii) above shall be made by the
Committee as constituted prior to the consummation of the Corporate Transaction.

(ii)           If the Award is assumed in connection with a Corporate
Transaction, the Award shall be appropriately adjusted, immediately after such
Corporate Transaction, to apply to the number and class of securities with
respect to a holder of the Common Stock with respect to which the Award relates
would have received upon consummation of such Corporate Transaction had such
shares been outstanding immediately prior to such Corporate Transaction. 
Appropriate adjustments to reflect such Corporate Transaction shall also be made
to the Settlement Value as determined at the time of the Corporate Transaction,
provided that both (A) such Settlement Value in the aggregate under the Award
and (B) the ratio of the Base Price to the Settlement Value as of the time of
the Corporate Transaction, shall remain the same both immediately prior to and
following any such adjustment made as of the time of the Corporate Transaction. 
Any such adjustment may result in fractional units and/or fractional cents per
unit, neither of which shall be subject to rounding to a whole unit or whole
cent.

(iii)          Notwithstanding anything herein to the contrary, the Committee
shall have the discretion, at any time while the Award remains outstanding, to
provide for the automatic acceleration of the vesting and settlement of the
Award upon the occurrence of a Change in Control.

(d)           For purposes of this Agreement, the term “Corporate Transaction”
shall mean either of the following stockholder-approved transactions to which
the Company is a party:

(i)            a merger, consolidation or other transaction involving the
Company in which securities possessing more than fifty percent (50%) of the
total combined voting power of the Company’s outstanding securities are
transferred to a person or persons different from the persons holding those
securities on the Grant Date, or

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(ii)           the sale, transfer or other disposition of all or substantially
all of the Company’s assets or a complete liquidation or dissolution of the
Company.

(iii)          For purposes of this Agreement, the term “Change in Control”
shall mean the occurrence of any of the following events: (i) any “person” (as
such term is used in Section 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended), other than Charles F. Willis, IV or an Affiliate (as defined
in Section 12) of Charles F. Willis, IV, is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under said Act), directly or indirectly, of securities
of Employer representing at least fifty percent of the total voting power
represented by Employer’s then outstanding voting securities; or (ii) the
stockholders of Employer approve a merger or consolidation of Employer with any
other corporation, other than a merger or consolidation which would result in
the voting securities of Employer outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent of the
total voting power represented by the voting securities of Employer or such
surviving entity outstanding immediately after such a merger or consolidation,
or the stockholders of Employer approve a plan of complete liquidation or
dissolution of Employer or an agreement for the sale or disposition by Employer
of all or substantially all of Employer’s assets, provided, however, that if
such merger, consolidation, liquidation, dissolution, sale or disposition does
not subsequently close, a Change in Control shall not be deemed to have
occurred; or (iii) individuals who are directors of Employer as of the date
hereof cease for any reason to constitute a majority of Employer’s Board of
Directors (the “Board”) unless such change(s) is approved by a majority of the
directors of Employer as of the date thereof.

6.             Limitations on Transfer.  The Award shall not be assignable or
transferable other than as expressly set forth in this Section 6.  The Award
may, in connection with Executive’s estate plan, be assigned in whole or in part
during Executive’s lifetime to one or more members of Executive’s immediate
family or to a trust established exclusively for one or more such family
members.  The terms applicable to the assigned portion shall be the same as
those in effect for the Award immediately prior to such assignment and shall be
set forth in such documents issued to the assignee as the Committee may deem
appropriate.

7.             Tax Withholding.  The Company shall deduct from all payments
pursuant to the Award any federal, state or local withholding taxes, social
security contributions and any other amounts which may be required to be
deducted or withheld by the Company pursuant to any federal, state or local
laws, rules or regulations.

8.             Effect of Subsequent Stock Option Grant.  In the event that prior
to the Settlement Date (i) Executive receives a grant of a stock option (a
“Substitute Option”) from the Company covering a number of shares at least equal
to the number of incentive bonus units subject to the Award (as set forth in
Section 1(a)) and (ii) the Committee determines at the time such Substitute
Option is granted (the “Substitution Date”) that the Substitute Option is
intended to replace the Award with respect to future increases (or decreases) in
the value of the Common Stock, the Award shall be deemed frozen effective as of
the Substitution Date such that, notwithstanding anything in Section 1 hereof to
the contrary, from and after the Substitution Date the Settlement Value shall be
no greater than the Settlement Value as determined on the Substitution Date, but
otherwise shall reflect fluctuations of the Fair Market Value of the Common
Stock between the

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Substitution Date and the Settlement Date.  Notwithstanding anything herein to
the contrary, in the event that the Fair Market Value of the Common Stock on the
Substitution Date is less than or equal to the Base Price, the Award shall be
forfeited without consideration.

9.             Committee Authority.  Any question concerning the interpretation
of this Agreement, any adjustments required to be made under this Agreement, and
any controversy that may arise under this Agreement shall be determined by the
Committee in its sole and absolute discretion.  All decisions hereunder by the
Committee hereunder shall be final, binding and conclusive.

10.           Amendment.  The Committee may modify or amend the Award at any
time and from time to time; provided, however, that no modification or amendment
shall impair any existing contractual rights of Executive unless the Executive
consents to the modification or amendment. 

11.           Entire Agreement.  This Agreement sets forth the entire agreement
and understanding between the parties as to the subject matter hereof and
supersedes all prior oral and written and all contemporaneous or subsequent oral
discussions, agreements and understandings of any kind or nature, including the
Original Award Agreement.

12.           Successors and Assigns.  Subject to the limitations set forth in
this Agreement, the benefits and obligations of this Agreement will be binding
on the executors, administrators, heirs, legal representatives, successors, and
assigns of the parties.

13.           Governing Law.  This Agreement shall be governed by, and construed
in accordance with, the laws of the State of California, excluding those laws
that direct the application of the laws of another jurisdiction.

14.           Tax Treatment.  Executive acknowledges that the Company has made
no warranties or representations to Executive with respect to the income tax
consequences of the transactions contemplated by this Agreement, including the
grant, vesting or settlement of the Award, and Executive is not relying on the
Company or its representatives for an assessment of such tax consequences.

15.           Counterparts.   This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all of which, taken together,
shall constitute one and the same instrument.

16.           No Right to Continued Employment.  THIS IS NOT AN EMPLOYMENT
CONTRACT.  THIS AGREEMENT IS NOT TO BE INTERPRETED AS A GUARANTEE OR CONTRACT OF
CONTINUING EMPLOYMENT WITH THE COMPANY OR ANY SUBSIDIARY OR AFFILIATE.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.

 

WILLIS LEASE FINANCE CORPORATION

 

 

 

 

 

By:

 

Bradley S. Forsyth

 

 

Name:

Lee G. Beaumont

 

 

 

Title:

Executive Vice President

 

 

 

 

 

 

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