Exhibit 10.36

 

AMENDMENT NO. 2 TO CREDIT AGREEMENT *

 

                This AMENDMENT NO. 2 TO CREDIT AGREEMENT (the “Amendment”) is
dated as of November 13, 2002 among Willis Lease Finance Corporation, a Delaware
corporation (“Borrower”), the banking institutions signatories hereto (the
“Banks”), National City Bank, as administrative agent for the Banks (the
“Administrative Agent”), Fortis Bank [Nederland] N.V., as security agent (the
“Security Agent”), and Fortis Bank [Nederland] N.V., as structuring agent (the
“Structuring Agent”).

 

W I T N E S S E T H

 

                WHEREAS, the Borrower, the Banks, the Administrative Agent, the
Security Agent, and the Structuring Agent are parties to that certain Credit
Agreement dated as of May 1, 2001, as amended by Amendment No. 1 to Credit
Agreement dated as of July 5, 2001 (the “Credit Agreement”);

 

                WHEREAS, the Borrower  has requested that Banks and Agents amend
the definition of “EBIT” so as to add back to Net Income the amount deducted for
the non-cash write-off of $781,000 in previously paid legal and bank fees
related to the former WLFC Funding Corporation loan from Wachovia Bank, N.A.
(the “Write-Off”) and make certain other changes to the Credit Agreement and the
other Loan Documents, and the Banks and the Agents are willing to do so;

 

                NOW, THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereto agree as follows:

 

                SECTION 1.  Definitions.  Capitalized terms not defined herein
shall have the meanings assigned to those terms in the Credit Agreement.

 

                SECTION 2.  Amendment to Definitions of “EBIT” and “Interest
Coverage Ratio.”

 

(a)           The definition of “EBIT” contained in Section 1.1 of the Credit
Agreement is hereby amended and restated in its entirety to read as follows:

 

                ““EBIT” shall mean the sum of (i) Net Income less any
extraordinary gain or loss included in the calculation thereof, plus (ii)
amounts deducted for interest expense and income taxes, plus (iii) to the extent
not included in clause (ii), amounts deducted for the non-cash write-off of
$781,000 in previously paid legal and bank fees related to the former WLFC
Funding Corporation loan from Wachovia Bank, N.A.”

 

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                *              Portions of the material in this Exhibit have
been redacted pursuant to a request for confidential treatment, and the redacted
material has been filed separately with the Securities and Exchange Commission
(the “Commission”).  An asterisk has been placed in the precise places in this
Agreement where we have redacted information, and the asterisk is keyed to a
legend which states that the material has been omitted pursuant to a request for
confidential treatment.

 

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                                (b)           The definition of “Interest
Coverage Ratio” contained in Section 1.1 of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:

 

                ““Interest Coverage Ratio” shall mean the ratio of EBIT of the
Willis Companies plus rent expenses of the Willis Companies to interest expense
(excluding, to the extent otherwise included therein, amounts deducted for the
non-cash write-off of $781,000 in previously paid legal and bank fees related to
the former WLFC Funding Corporation loan from Wachovia Bank, N.A.) of the Willis
Companies plus rent expenses of the Willis Companies.”

 

                SECTION 3.         Other Amendments.  In addition to the
amendments contained in Section 2 above, the Credit Agreement and the other Loan
Documents are hereby amended in the following respects:

 

                                (a)           All references in the Credit
Agreement and the other Loan Documents to the “Funding Corp. Guaranty” are
hereby deleted and replaced by “Willis Engine Funding Guaranty”; all references
in the Credit Agreement and the other Loan Documents to “WLFC Funding
Corporation” are hereby deleted and replaced by “Willis Engine Funding LLC, a
Delaware limited liability company”; and all references in the Credit Agreement
and the other Loan Documents to the “WLFC Funding Facility” are hereby deleted
and replaced by “Willis Engine Funding Facility.”

 

                                (b)           The definition of “Consent and
Intercreditor Agreement” contained in Section 1.1 of the Credit Agreement is
hereby deleted.  All references in the Credit Agreement and the other Loan
Documents to the “Consent and Intercreditor Agreement” are hereby deleted.

 

                                (c)           The definition of “Debt” contained
in Section 1.1 of the Credit Agreement is hereby amended by adding the following
language to the end of clause (v) thereof:

 

                “, except for guaranties of the obligations of Owner Trustees as
lessor under Leases entered into in the ordinary course of business, where the
Owner Trustee is acting as trustee under a Trust Agreement having the Borrower
as the sole beneficiary”

 

                                (d)           The definition of “WLFC Funding
Facility” contained in Section 1.1 of the Credit Agreement is hereby deleted.  A
new definition of “Willis Engine Funding Facility” is hereby added to Section
1.1 of the Credit Agreement in alphabetical order to read as follows:

 

                ““Willis Engine Funding Facility” shall mean the transactions
contemplated by (i) that certain Indenture dated as of September 12, 2002 (the
“Indenture”) between Willis Engine Funding LLC, a Delaware limited liability
company (“WEF”) and The Bank of New York, as indenture trustee (the “Indenture
Trustee”), as supplemented by that certain Series 2002-1 Supplement dated as of
September 12, 2002 (the “Supplement”) between WEF and the Indenture Trustee,
(ii) that certain Class A Note Purchase Agreement dated as of September 12, 2002
(the “Class A Note Purchase Agreement”) by and among Borrower, WEF, Sheffield
Receivables Corporation (“Sheffield”) (“Class A Purchaser,” together with Class
B Purchasers (as defined below), each individually a “Purchaser” and
collectively, the “Purchasers”), and Barclays Bank PLC (“Barclays”), as agent on
behalf of the Class A Purchasers, (iii) that certain Class B Note

 

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Purchase Agreement dated as of September 12, 2002 (the “Class B Note Purchase
Agreement”; together with the Class A Note Purchase Agreement, the “Note
Purchase Agreement”) by and among Borrower, WEF, Fortis (a “Class B Purchaser”),
and Barclays, as a Class B Purchaser and as agent on behalf of the Class B
Purchasers, (iv) that certain Contribution and Sale Agreement dated as of
September 12, 2002 (the “Contribution Agreement”) by and between Borrower and
WEF, (v) that certain Administration Agreement dated as of September 12, 2002
(the “Administration Agreement”) by and among WEF, as issuer, Borrower, as
servicer, Barclays, as administrative agent, and the Indenture Trustee, (vi)
that certain Guaranty dated as of September 12, 2002 (the “Willis Engine Funding
Guaranty”) by Borrower in favor of Barclays, as deal agent and as a Class B
Purchaser, and Fortis as a Class B Purchaser, (vii) that certain Reimbursement
Agreement dated as of September 12, 2002 (the “Reimbursement Agreement”) by and
between Borrower and WEF, (viii) that certain letter regarding indemnification
obligations dated September 12, 2002 (the “Indemnification Letter”) by Borrower
in favor of Indenture Trustee, (ix) that certain Custodial Agreement dated as of
September 12, 2002 (the “Custodial Agreement”) by and among Borrower, BNY
Midwest Trust Company, as custodian, WEF, Indenture Trustee, and Barclays, as
deal agent on behalf of the Purchasers, (x) that certain Servicing Agreement
dated as of September 12, 2002 (the “Servicing Agreement”) by and between
Borrower and WEF, (xi) that certain Agreement and Limited Waiver dated as of
September 12, 2002 (the “Agreement and Limited Waiver”) by and among WEF,
Barclays, as deal agent and a Class B Purchaser, Sheffield, as a Class A
Purchaser, and Fortis, as a Class B Note Purchaser;  (xii) that certain First
Transfer Master Assignment and Assumption Agreement and Bill of Sale dated as of
September 16, 2002 (the “First Transfer Master Agreement”) by and between
Borrower and Wells Fargo Bank Northwest, National Association, not in its
individual capacity, but solely in its capacity as owner trustee under the trust
agreements listed in Exhibit A thereto, (xiii) that certain Engine or Beneficial
Interest Transfer Certificate dated as of September 16, 2002 (the “Engine
Transfer Certificate”) by and between Borrower and WEF, and (xiv) certain other
documents and agreements ancillary thereto; in each of cases (i), (ii), (iii),
(iv), (v), (vi), (vii), (viii), (ix), (x), (xi), (xii), (xiii), and (xiv) as
amended, waived, restated and supplemented from time to time.”

 

                                (e)           The first sentence of Section 6.3
of the Credit Agreement is hereby amended and restated in its entirety to read
as follows:

 

                “Guarantee or otherwise in any way become or be responsible for
indebtedness or obligations (including working capital maintenance, take-or-pay
contracts) of any unconsolidated Person, contingently or otherwise, except for
guaranties of the obligations of Owner Trustees as lessor under Leases entered
into in the ordinary course of business, where the Owner Trustee is acting as
trustee under a Trust Agreement having the Borrower as the sole beneficiary.”

 

                SECTION 4.  Amended Disclosure Schedule (Schedule 1) and
Schedule 2.  The Disclosure Schedule (Schedule 1) to the Credit Agreement is
hereby deleted in its entirety and replaced with the Disclosure Schedule
(Schedule 1) attached to this Amendment.  Schedule 2 to the Credit Agreement is
hereby deleted in its entirety and replaced with Schedule 2 attached to this
Amendment.

 

                SECTION 5.  Amendment Fee.  The Borrower agrees, on the date of
this Amendment, to pay to the Administrative Agent for the account of each Bank
signatory to this Amendment an

 

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amendment fee equal to    basis points of such Bank’s Revolving Loan Commitment
on the date of this Amendment.  The Administrative Agent shall promptly
distribute to such Banks their respective portions of the amendment fee.  Any
Bank that is not a signatory to this Amendment on the date of this Amendment
will not be entitled to an amendment fee.*

 

                SECTION 6.  Full Force and Effect; Entire Agreement.  Except to
the extent expressly provided in this Amendment, the terms and conditions of the
Credit Agreement and each of the other Loan Documents shall remain unchanged and
in full force and effect.  This Amendment constitutes the final agreement of the
parties hereto with respect to the matters set forth herein and supersedes any
prior agreement or understanding, written or oral, with respect to the matters
contained herein.

 

                SECTION 7.  Effective Date of Amendment.  This Amendment shall
be deemed effective retroactively to September 16, 2002.  From and after such
date, any and all references to the “Credit Agreement” and the other Loan
Documents shall be deemed to refer to the Credit Agreement and the other Loan
Documents as amended hereby.

 

                SECTION 8.  Governing Law; Severability; Construction of
Amendment.  This Amendment and all rights and obligations of the parties
hereunder shall be governed by and be construed and enforced in accordance with
the laws of the State of California without regard to California or federal
principles of conflict of laws.  To the extent permitted by applicable law, the
parties hereby waive any provision of law which renders any provision hereof
prohibited or unenforceable in any respect.  Otherwise, any provision of this
Amendment which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability, without invalidating any of the remaining provisions hereof,
and any such prohibition or unenforceability in any one or more jurisdictions
shall not invalidate or render unenforceable such provisions in other
jurisdictions.  The parties’ failure at any time to require strict performance
of any of the provisions of this Amendment shall not waive or diminish any right
thereafter to demand strict compliance therewith or with any other provision of
this Amendment.

 

                SECTION 9.  Counterparts.  This Amendment may be signed in any
number of counterparts, and by different parties in separate counterparts, with
the same effect as if the signatures to each such counterpart were upon a single
instrument.  All counterparts shall be deemed an original of this Amendment.

 

                SECTION 10.  Headings.  All section headings contained herein
are for convenience of reference only and are not intended to define or limit
the scope of any provision of this Amendment.

 

                SECTION 11.  Representations and Warranties.  Borrower hereby
represents and warrants to each of the other parties hereto that (i) this
Amendment has been duly authorized, executed and delivered by it and (ii) this
Amendment constitutes its legal, valid and binding obligation, enforceable
against it in accordance with its terms.

 

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                *              This redacted material has been omitted pursuant
to a request for confidential treatment, and the material has been filed
separately with the Commission.

 

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                SECTION 12.  Facsimile Signatures. The parties agree that this
Amendment will be considered executed and delivered when the signature of a
party is delivered to the Administrative Agent by facsimile transmission.  Such
facsimile signature shall be treated in all respects as having the same effect
as an original signature.

 

IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
and delivered by their proper and duly authorized officers as of the date and
year first written above.

 

 

WILLIS LEASE FINANCE CORPORATION

 

 

 

By:

/s/ MONICA J. BURKE

 

 

Name:

Monica J. Burke

 

Title:

Executive Vice President and Chief Financial Officer

 

 

 

NATIONAL CITY BANK

 

 

 

By:

/s/ CHRISTOS KYTZIDIS

 

 

Name:

Christos Kytzidis

 

Title:

Vice President

 

 

 

NATIONAL CITY BANK, as Administrative Agent

 

 

 

By:

/s/ CHRISTOS KYTZIDIS

 

 

Name:

Christos Kytzidis

 

Title:

Vice President

 

 

 

FORTIS BANK [NEDERLAND] N.V.

 

 

 

By:

/s/ M.P.A. ZONDAG; B.M. KOOL

 

 

Name:

M.P.A. Zondag; B.M. Kool

 

Title:

 

 

 

 

FORTIS BANK [NEDERLAND] N.V., as Security Agent

 

 

 

By:

/s/ M.P.A. ZONDAG; B.M. KOOL

 

 

Name:

M.P.A. Zondag; B.M. Kool

 

Title:

 

 

 

 

FORTIS BANK [NEDERLAND] N.V., as Structuring Agent

 

 

 

By:

/s/ M.P.A. ZONDAG; B.M. KOOL

 

 

Name:

M.P.A. Zondag; B.M. Kool

 

Title:

 

 

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WACHOVIA BANK, NATIONAL ASSOCIATION,

f/k/a First Union National Bank 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

CITY NATIONAL BANK

 

 

 

By:

/s/ NANCI BRUSATI DIAS

 

 

Name:

Nanci Brusati Dias

 

Title:

Vice President

 

 

 

CITIBANK, N.A., as successor to European American Bank

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

CALIFORNIA BANK & TRUST

 

 

 

By:

/s/ J. MICHAEL SULLIVAN

 

 

Name:

J. Michael Sullivan

 

Title:

Vice President

 

 

 

BANCO POPULAR NORTH AMERICA

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

CAPITAL BANK PLC

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

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