FORM OF RELEVANT GUARANTY

 
THIS IS A CONFIDENTIAL
DOCUMENT
 

FORM OF RELEVANT GUARANTY
THIS IS A CONFIDENTIAL
DOCUMENT

GUARANTY BY REPUBLIC AIRWAYS HOLDINGS INC.
Section 1. Guaranty of Obligations. FOR VALUE RECEIVED, REPUBLIC AIRWAYS
HOLDINGS INC., a Delaware corporation (“Guarantor”), pursuant to that certain
Loan Agreement (2013), dated as of July 2, 2013 (the “Loan Agreement”), between
Republic Airline Inc., an Indiana corporation (the “Borrower”), and Agência
Especial de Financiamento Industrial - FINAME (the “Lender”) (terms defined in
the Loan Agreement and used herein shall have such respective defined meanings
unless otherwise defined herein) does hereby unconditionally and irrevocably
guarantee, as primary obligor and not as surety, without set-off, abatement,
deferment or deduction, to each Lender and the Security Trustee (collectively,
the “Guaranteed Parties”) the due and punctual performance and observance by the
Borrower of its obligations under the Operative Agreements, as the same may be
amended, modified or supplemented from time to time (the “Obligations”). In the
event of any nonpayment or nonperformance of any Obligation, the Guarantor
agrees to pay or perform or cause such payment or performance to be made of such
nonpayment or nonperformance. The obligation of Guarantor hereunder to pay or
perform any Obligation shall be subject to the terms and conditions of the
Operative Agreements applicable to such Obligation.
Section 2. Representations and Warranties. Guarantor represents and warrants
that (a) Guarantor was duly incorporated and is validly existing and in good
standing under the laws of Delaware; (b) the execution, delivery and performance
of this Guaranty are within Guarantor’s power and authority and do not violate
the certificate of incorporation or the by-laws of Guarantor or any indenture,
mortgage, credit agreement, note, lease or other agreement to which Guarantor is
a party or by which Guarantor is bound, or any law, governmental rule,
regulation, judgment or order binding on Guarantor; (c) this Guaranty has been
duly authorized, executed and delivered on behalf of Guarantor and constitutes a
legal, valid, binding and enforceable obligation of Guarantor, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar laws affecting the rights of
creditors generally and by general principles of equity, whether considered in a
proceeding at law or in equity; and (d) Guarantor is fully aware of the terms
and conditions contained in, and has received a copy of, each of the Operative
Agreements in existence as of the date hereof and is fully aware of the
transactions contemplated by the terms thereof.
Section 3. Absolute Guarantee. Guarantor understands and agrees that its
obligations hereunder shall be continuing, absolute and unconditional, shall
remain in full force and effect until final and irrevocable payment, performance
or observance in full of all of the Obligations has

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occurred and shall not, in any manner, be affected by, and Guarantor hereby
waives any defense to, or right to seek discharge of, its obligations hereunder
with respect to, (a) any extension or renewal of time or forbearance for payment
or performance of any Obligation; (b) any modification of, or amendment or
supplement to, any Operative Agreement; (c) any exchange, surrender or
modification of any collateral security for any of the Obligations, or any
furnishing or acceptance of additional security, or any release of any security,
for the Obligations; (d) any waiver, consent or other action or inaction or any
exercise or non-exercise of any right, remedy or power with respect to Borrower,
or any change in the structure of Borrower; (e) any change in ownership of the
shares of capital stock of Borrower or any merger or consolidation of Borrower
or Guarantor into or with any other person; (f) any assignment, transfer, lease
or other arrangement by Borrower or any Guaranteed Party (or any successor or
assign thereof) of its interest, or any part thereof, in and to any Operative
Agreement or the Aircraft or any part thereof or the assignment and transfer of
any rights relating to any Obligation; (g) any illegality, unenforceability or
invalidity of any Operative Agreement, any of the Obligations or any collateral
security therefor; (h) any substitution, release or exchange of any other
guarantee of, or security for, any of the Obligations at any time or from time
to time held by any Guaranteed Party, or (i) any other circumstance or condition
whatsoever (with or without notice to or knowledge of Borrower or Guarantor)
that constitutes, or might be construed to constitute, an equitable or legal
discharge of Borrower or the Obligations or of Guarantor under this Guaranty,
except final and irrevocable payment and performance in full of the Obligations
in accordance with the terms and conditions of the Operative Agreements. No
failure or delay or lack of demand, notice or diligence or course of dealing in
exercising any right under this Guaranty shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right under this Guaranty
or the other Operative Agreements.
Section 4. Guarantee of Payment and Performance. This Guaranty is a guarantee of
payment and performance and not of collection and, to the fullest extent
permitted by applicable law, the Guarantor waives any right to require that any
action or recourse against Borrower or any other Person or against any right or
interest in any property or collateral security for the obligations be taken or
exhausted prior to action being taken against Guarantor.
Section 5. Waiver. Guarantor hereby unconditionally waives, to the fullest
extent permitted by applicable law, presentment, demand for payment, promptness,
diligence and notice of any kind whatsoever with respect to this Guaranty; such
waiver includes, without limitation: (a) notice of acceptance of this Guaranty
or notice of nonpayment or nonperformance of any of the Obligations; (b) demand
for payment or performance from Guarantor; and (c) presentment for payment upon
Guarantor or the making of any protest.
Section 6. Subrogation. Notwithstanding any payment or payments made by
Guarantor hereunder or any setoff or application of funds of Guarantor by any
Guaranteed Party

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hereof, Guarantor shall not be entitled to succeed to or be subrogated to any of
the rights of any Guaranteed Party against Borrower or any collateral, security
or guaranty or right of set-off held by any Guaranteed Party for the payment or
performance of the Obligations, nor shall Guarantor seek or be entitled to seek
any reimbursement from Borrower in respect of payments made by Guarantor
hereunder, until all amounts and performance owing to each Guaranteed Party by
Borrower on account of the Obligations are irrevocably and finally paid and
performed in full. So long as any Obligation remains outstanding, if any amount
shall be paid by or on behalf of Borrower to Guarantor on account of any rights
of subrogation, such amount shall be held by Guarantor in trust, segregated from
other funds of Guarantor, be turned over to the Guaranteed Party entitled
thereto in the exact form received by Guarantor (duly endorsed without recourse
by Guarantor to such Guaranteed Party, if required), to be applied against the
Obligations.
Section 7. Bankruptcy. (a) In the event that this Guaranty or any Operative
Agreement to which Borrower is a party shall be terminated, rejected or
disaffirmed as a result of bankruptcy, insolvency, reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar proceedings with
respect to Borrower, Guarantor’s obligations hereunder to the Guaranteed Parties
shall continue to the same extent as if the same had not been so terminated,
rejected or disaffirmed. Guarantor hereby waives all rights and benefits that
might, in whole or in part, relieve it from the performance of its duties and
obligations by reason of any proceeding as specified in the preceding sentence,
and Guarantor agrees that it shall be liable for the full amount of the
Obligations irrespective of and without regard to any modification, limitation
or discharge of the liability of Borrower that may result from any such
proceedings and notwithstanding any stay, injunction or other prohibition issued
in any such proceedings.
(b)    The Guarantor agrees that if, at any time, all or any part of any payment
or performance theretofore applied by any Guaranteed Party to any of the
Obligations is or must be rescinded or returned by such Guaranteed Party for any
reason whatsoever (including, without limitation, the insolvency, bankruptcy or
reorganization of Borrower, Guarantor or any other Person), such Obligations
shall, for the purposes of this Guaranty, to the extent that such payment or
performance is or must be rescinded or returned, be deemed to have continued in
existence, notwithstanding such application by such Guaranteed Party, and this
Guaranty shall continue to be effective or be reinstated as to such Obligations,
all as though such application by such Guaranteed Party had not been made. If an
event permitting the declaration of a Default or an Event of Default under an
Operative Agreement shall at any time have occurred and be continuing, and such
declaration of Default or Event of Default shall at such time be prevented by
reason of the pendency against Borrower, Guarantor or any other Person of a case
or proceeding under a bankruptcy or insolvency law, Guarantor agrees that, for
purposes of this Guaranty and its obligations hereunder, a Default or Event of
Default shall be deemed to have been declared with respect to such Operative
Agreement with the same effect as if such Operative Agreement had been
enforceable in accordance with the terms thereof.

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Section 8. Merger. (a)    Guarantor agrees that it will not consolidate or merge
with or into any other Person or sell, convey, transfer, lease or otherwise
dispose of substantially all of its assets in one or a series of transactions to
any Person (a “Guarantor Merger Transaction”), except as follows:
(i)    The successor to Guarantor, if any, shall execute and deliver to Lender a
duly authorized, valid, binding and enforceable agreement in form and substance
reasonably satisfactory to Lender containing an assumption by such Person of
this Agreement;
(ii)    Immediately after giving effect to such Guarantor Merger Transaction the
tangible net worth of Guarantor (or its successor, if any) shall be equal to or
greater than 100% of the tangible net worth of Guarantor immediately prior to
the Guarantor Merger Transaction.
(iii)    Immediately after giving effect to such Guarantor Merger Transaction,
no Material Adverse Change shall occur as a result of such Guarantor Merger
Transaction and no “Event of Default”, “Bankruptcy Default” or “Payment Default”
(as such terms are defined in Annex A to the Loan Agreement) shall have occurred
and be continuing under the Loan Agreement;
(iv)    Guarantor shall (1) at least 30 days prior to such Guarantor Merger
Transaction have given written notice of such Guarantor Merger Transaction to
Lender and (2) have delivered to Lender (A) a certificate signed by the
President or any Vice President of Guarantor stating that such Guarantor Merger
Transaction and the assumption agreement mentioned in clause (i) above (if any)
comply with this Section and that all conditions precedent herein provided for
relating to such transaction have been complied with and (B) an opinion of
counsel (which shall be reasonably satisfactory to Lender) that the assumption
agreement mentioned in clause (i) above is, subject to reasonable assumptions,
qualifications and exceptions, the duly authorized, valid and binding agreement
of the successor to Guarantor; and
(v)    this Guaranty shall remain in full force and effect with respect to the
obligations of any successor under this Guaranty and the Guarantor shall have
reaffirmed its obligations under this Guaranty in writing.
(b)    Upon the closing of a Guarantor Merger Transaction made in accordance
with this Section 8, the successor to Guarantor (if any) shall succeed to, and
be substituted for, and may exercise every right and power of, Guarantor under
this Guaranty with the same effect as if such successor had been named as
Guarantor originally. No Guarantor Merger Transaction shall have the effect of
releasing Guarantor or any successor from liability in respect of this Guaranty.
Section 9.    Taxes.    Any and all payments made to the Lender hereunder or
under any instrument delivered hereunder shall be made as established herein or
the applicable provisions of such other instrument, free and clear of and
without deduction for any and all present and future

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taxes (including, without limitation, value-added taxes and withholding taxes),
levies, imposts, deductions, charges or withholdings and all liabilities with
respect thereto, excluding, in the case of each of the Lenders, taxes imposed on
its overall net income, and franchise taxes imposed on it in lieu of net income
taxes, by the jurisdiction under the laws of which any Lender is organized or
any political subdivision thereof and taxes imposed on its overall net income,
and franchise taxes imposed on it in lieu of net income taxes, by the
jurisdiction of each of the Lenders’ lending office or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities hereinafter referred to as “Taxes”). If the
Guarantor shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder or under any other instrument to be delivered hereunder to
any of the Lenders, (i) the sum payable shall be increased as may be necessary
so that, after making all required deductions (including deductions applicable
to additional sums payable under this Section), the relevant Lender receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) the Guarantor shall make such deductions, and (iii) the Guarantor shall pay
the full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law. In addition, the Guarantor shall pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies that arise from any payment made hereunder or
under any other instrument to be delivered hereunder or from the execution,
delivery or registration of, performing under, or otherwise with respect to this
Guaranty or the Obligations or any other instrument to be delivered hereunder
(hereinafter referred to as “Other Taxes”). The Guarantor shall indemnify each
of the Lenders for and hold each of them harmless against the full amount of
Taxes or Other Taxes (including, without limitation, any taxes of any kind
imposed or asserted by any jurisdiction on amounts payable under this Section)
imposed on or paid by any of them in respect of any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
This indemnification shall be made within 30 days from the date the relevant
Lender makes written demand therefor. Within 30 days after the date of any
payment of Taxes, the Guarantor shall furnish to such Lender, at its address
referred to in Section 13, the original or a certified copy of a receipt
evidencing such payment.
Section 10. Amendments and Other Actions. Guarantor agrees that, in its capacity
as a guarantor, it shall not be required to consent to, or to receive notice of,
any supplement to or amendment of, or waiver or modification of the terms of the
Loan Agreement or any of the other Operative Agreements that may be made or
given as provided therein and any such supplement, amendment, waiver or
modification shall not affect the liability of Guarantor hereunder.
Section 11. Severability. Any provision of this Guaranty that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction, in each case to the fullest extent permitted by law.

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Section 12. Successors and Assigns. This Guaranty shall be binding upon the
successors and permitted assigns of Guarantor and shall inure to the benefit of,
and shall be enforceable by, the Guaranteed Parties and their respective
successors and permitted assigns. Subject to Section 7(b), this Guaranty shall
terminate and be of no further force and effect upon the performance and
observance in full of the Obligations.
Section 13. Notices. All notices to or upon Guarantor or any Guaranteed Party
shall be made in accordance with the terms of Section 9.2 of the Loan Agreement
and, if delivered to Guarantor, shall be addressed to Republic Airways Holdings
Inc., 8909 Purdue Road, Suite 300, Indianapolis, IN 46268, Fax: 317‑484‑6040,
Attention: President, or to such other address as Guarantor shall provide to the
Guaranteed Parties in writing.
Section 14. JURISDICTION AND WAIVER OF JURY TRIAL. GUARANTOR HEREBY AGREES THAT
THE PROVISIONS OF SECTIONS 9.11 AND 9.13 OF THE LOAN AGREEMENT SHALL APPLY,
MUTATIS MUTANDIS, AS THOUGH GUARANTOR WERE BORROWER IN ALL SUCH SECTIONS.
Section 15. Costs and Expenses. Guarantor agrees to pay to the Guaranteed
Parties any and all reasonable expenses (including reasonable legal fees and
expenses) incurred by the Guaranteed Parties in enforcing this Guaranty.
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THIS GUARANTY SHALL IN ALL RESPECTS BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
Dated: July 15, 2013
REPUBLIC AIRWAYS HOLDINGS INC.
By: /s/ Lars-Erik Arnell
Name: Lars-Erik Arnell
Title: SVP, Corporate Development