Exhibit 10.1


 


AIRCRAFT LEASE

(S/N 525-0497)


 


DATED AS OF October 5, 2007,


 


Between


 


BANC OF AMERICA LEASING & CAPITAL, LLC

as Lessor


 


and


 


Ahern Rentals, Inc. and Don F. Ahern

as Lessee


 

















 


TABLE OF CONTENTS


 


	
  SECTION 1. LEASE OF
  AIRCRAFT

  	
   

  	
  1

  
	
  SECTION 2. CLOSING
  CONDITIONS

  	
   

  	
  1

  
	
  SECTION 3. TERM AND
  RENT

  	
   

  	
  1

  
	
  SECTION 4. TITLE;
  QUIET ENJOYMENT

  	
   

  	
  2

  
	
  SECTION 5. DISCLAIMER
  AND ASSIGNMENT OF WARRANTIES

  	
   

  	
  2

  
	
  SECTION 6.
  REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF LESSEE

  	
   

  	
  2

  
	
  SECTION 7. NET LEASE

  	
   

  	
  4

  
	
  SECTION 8. TAXES

  	
   

  	
  4

  
	
  SECTION 9.
  COMPLIANCE, USE AND MAINTENANCE

  	
   

  	
  5

  
	
  SECTION 10. LOSS OR
  DAMAGE

  	
   

  	
  6

  
	
  SECTION 11.
  INDEMNIFICATION

  	
   

  	
  7

  
	
  SECTION 12.
  ASSIGNMENT AND SUBLEASE

  	
   

  	
  8

  
	
  SECTION 13. EVENTS OF
  DEFAULT AND REMEDIES

  	
   

  	
  9

  
	
  SECTION 14. NOTICES,
  REPORTS, FURTHER ASSURANCES AND INSPECTIONS

  	
   

  	
  11

  
	
  SECTION 15.
  TRANSACTION EXPENSES

  	
   

  	
  12

  
	
  SECTION 16.
  MISCELLANEOUS

  	
   

  	
  12

  
	
  SECTION 17. JOINT AND
  SEVERAL OBGLIGATIONS OF CO-LESSEES

  	
   

  	
  14

  
	
  SECTION 18. TRUTH IN
  LEASING

  	
   

  	
  16

  



 


EXHIBIT A – Definitions


 


Special Tax Indemnity Rider*

Insurance Addendum

Closing Terms Addendum

Purchase, Early Purchase and Renewal Option Addendum

Return Addendum


 


Lease Supplement


Schedule No. 1
to Lease Supplement

Schedule No. 2 to Lease Supplement

Schedule No. 2-A to Lease Supplement*

Schedule No. 3 to Lease Supplement*


 






*                            to be deleted from FAA filing copy and copy
of lease to be placed on-board the Aircraft


 

















 


This
AIRCRAFT LEASE (S/N 525-0497) (together with all Supplements, Exhibits, Riders
and Addenda hereto, the “Lease”) is made and entered into as of October 5,
2007, by and between BANC OF AMERICA LEASING & CAPITAL, LLC (“Lessor”),
and Ahern Rentals, Inc. (the “Corporate Lessee”) and Don F. Ahern (“Ahern”),
as co-lessees (collectively, the Corporate Lessee and Ahern are referred to
hereinafter as the “Lessee”). Certain capitalized terms as used in this
Lease are defined in Exhibit A hereto, and such definitions are
incorporated herein and made a part hereof as though set forth in full
herein.


 


SECTION 1.
LEASE OF AIRCRAFT.
Subject to the terms and conditions provided in this Lease, Lessor agrees to
lease the Aircraft to Lessee, and Lessee agrees to lease the Aircraft from
Lessor. Lessor hereby appoints. Lessee as Lessor’s agent for the sole and
limited purpose of accepting delivery of the Aircraft from Supplier. The execution
by Lessee of the Lease Supplement will evidence that the Aircraft is leased
under, and is subject to all of the terms, provisions and conditions of, this
Lease and shall constitute Lessee’s unconditional and irrevocable acceptance of
the Aircraft for all purposes of this Lease.


 


SECTION 2.
CLOSING CONDITIONS.
Lessor’s obligations to purchase the Aircraft from Supplier and to lease the
Aircraft to Lessee shall be conditioned upon the satisfaction of all of the
following conditions: (a) Lessor receives the Required Documents and
Purchase Documents, in form and substance satisfactory to Lessor, at least
one (1) Business Day prior to the anticipated closing date; (b) all
representations and warranties in this Lease, including the Lease Supplement,
are true and correct; (c) Lessee accepts the Aircraft from Supplier on
Lessor’s behalf, under the Purchase Documents and under this Lease, on the
Acceptance Date (which date shall be no later than the Last Acceptance Date); (d) FAA
Counsel confirms to Lessor that (i) it has received in escrow all of the
Aviation Documents, and (ii) upon filing the Aviation Documents, title to
the Airframe and the Engines will be vested in Lessor, and the Aircraft
(including the Airframe and Engines) will be free and clear of all Liens, other
than this Lease: (e) Lessee (i) confirms to Lessor that it is a
Transacting User Entity with the International Registry, (ii) identifies
its Administrator to Lessor and (iii) has appointed a Professional User
Entity satisfactory to Lessor; (f) Lessee and Supplier each authorizes (i) the
release from escrow of all Required Documents and Aviation Documents held by
Lessor, its FAA Counsel, other counsel or Lessor and/or Lessee’s Professional
User Entity, (ii) Lessor, FAA Counsel or Lessor and/or Lessee’s
Professional User Entity to file Aviation Documents and any other filings at
the FAA, with the International Registry and any other applicable filing
offices, and (iii) its Professional User Entity to consent to the
registration of any International Interests permitted or required by Lessor
(including authorization to effect the Final Consent); provided, such
authorization shall be deemed to have been automatically made by Lessee
(whether or not so confirmed) immediately upon the receipt by Lessee, Supplier
or any other Person (as directed in any pay proceeds letter executed by Lessee
in connection with this Lease) of the funds constituting the Lessor’s Cost.
Lessee acknowledges and agrees that (i) any advance of funds by Lessor
prior to the satisfaction of all of the preceding conditions shall not
constitute a wavier by Lessor of any such condition, and (ii) Lease shall
be irrevocably obligated to satisfy all of such conditions prior to the FAA
filing deadline on the day on which such funds are received.


 


SECTION 3.
TERM AND RENT.


 


(a) Term.
The Lease of the Aircraft to Lessee shall commence on the Acceptance Date and
end on the Expiration Date, unless extended or earlier terminated or cancelled
pursuant to this Lease.


 


(b) Rent.
Lessee shall pay to Lessor the following daily and periodic rent amounts (“Basic
Rent”) (i) on the Acceptance Date, an amount equal to the product of
the Daily Rent Percentage times the Lessor’s Cost, for each day starting with
the Acceptance Date, to but excluding the Rent Commencement Date (“Daily
Rent”), and (ii) on the First Basic Rent Date and on each Basic Rent
Date following that date, an amount equal to the product of the Lessor’s Cost
multiplied by the applicable Basic Rent Percentage set forth on Schedule No. 2A
for the Basic Rent number corresponding to any such Basic Rent Date. Lessee
shall also pay the following amounts as “Supplemental Rent” (together
with all Basic Rent and Daily Rent, the “Rent”): (i) as and when
due, any other amount that Lessee is obligated to pay under this Lease to
Lessor or others (including, Casualty Value and/or any amounts due pursuant to
any Addendum or Rider hereto), (ii) interest accruing at the Late Payment
Rate on any Rent not paid when due, until paid, and (iii) the
Administrative Charge with respect to any Rent not paid when due (as
compensation to Lessor for the


 

















 


expenses attributable to
Lessee’s failure to pay, and not as a penalty). Lessee’s obligation to pay
Supplemental Rent shall survive the expiration, cancellation or other termination
of this Lease. All payments of Rent shall be made to Lessor, in United States
Dollars (“U.S. Dollars”), in immediately available funds on the date
payable hereunder at the address designated by Lessor for payment, or by wire
transfer to an account specified by Lessor, or at such other address or to such
other Person as Lessor may direct by notice in writing to Lessee.


 


SECTION 4.
TITLE; QUIET ENJOYMENT.
Lessee acknowledges and agrees that upon Lessor’s acquiring the Aircraft on the
Acceptance Date, Lessor is and shall remain the owner of the Aircraft (unless
Lessor sells the Aircraft pursuant to an applicable provision of this Lease),
and Lessee shall not acquire any right, title or interest in or to the Aircraft
except the right to use the Aircraft pursuant to the terms of this Lease.
Lessor warrants that during the Term, so long as no Event of Default has
occurred and is continuing, Lessee’s possession and use of the Aircraft shall
not be interfered with by Lessor or anyone rightfully claiming an interest
through Lessor. The preceding warranty is in lieu of all other warranties by
Lessor, whether written, oral or implied, with respect to this Lease or the
Aircraft, and without limiting the provisions of Section 7 hereof, any
actual or purported breach of this warranty shall not give rise to any
Abatement, and Lessor shall not be deemed to have modified in any respect the
obligations of Lessee pursuant to Section 7 hereof, which obligations are
and shall remain absolute, irrevocable and unconditional under all events and
circumstances whatsoever.


 


SECTION 5.
DISCLAIMER AND ASSIGNMENT OF WARRANTIES. EXCEPT AS PROVIDED IN SECTION 4,
LESSOR SHALL NOT BE DEEMED TO HAVE MADE, AND HEREBY DISCLAIMS, ANY
REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, AS TO THE AIRCRAFT,
INCLUDING ANY ENGINE, PART OR RECORD, OR ANY MATTER WHATSOEVER,
INLCLUDING, THE AIRCRAFT’S DESIGN, CONDITION, MERCHANTABILITY, FITNESS FOR ANY
PARTICULAR PURPOSE, TITLE, ABSENCE OF ANY PATENT, TRADEMARK OR COPYRIGHT
INFRINGEMENT OR LATENT DEFECT (WHETHER OR NOT DISCOVERABLE BY LESSEE),
COMPLIANCE OF THE AIRCRAFT WITH ANY APPLICABLE LAW, CONFORMITY OF THE AIRCRAFT
TO THE PROVISIONS AND SPECIFICATIONS OF ANY PURCHASE DOCUMENT OR TO THE
DESCRIPTION SET FORTH IN THIS LEASE, OR ANY INTERFERENCE OR INFRINGEMENT
(EXCEPT AS EXPRESSLY PROVIDED IN SECTION 4), OR ARISING FROM ANY DEFECTS
OR FROM ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR USAGE OF TRADE, NOR
SHALL LESSOR BE LIABLE, FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL
DAMAGES OR FOR STRICT OR ABSOLUTE LIABILITY IN TORT; AND LESSEE HEREBY WAIVES
ANY CLAIMS ARISING OUT OF ANY OF THE FOREGOING. Without limiting the foregoing, Lessor will
not be responsible to Lessee or any other Person with respect to, and Lessee
agrees to bear sole responsibility for, any risk or other matter that is the
subject of Lessor’s disclaimer. So long as no Event of Default has occurred,
Lessee may exercise Lessor’s rights, if any, under any warranty of
Manufacturer or Supplier with respect to the Aircraft. Lessee’s exercise of
such rights shall be at its sole cost and risk, shall not result in any
prejudice to Lessor, and may be exercised only during the Term. Lessee
shall not attempt to enforce any such warranty by legal proceeding without
Lessor’s prior written approval.


 


SECTION 6.
REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF LESSEE. Lessee represents, warrants and agrees as
follows:


 


(a) Due
Organization, Name, Organizational Number, Etc. Corporate Lessee has the form of
business organization indicated and is and will remain duly organized and
existing in good standing under the laws of the state specified in Schedule No. 2
and is duly qualified to do business wherever necessary to perform its
obligations under this Lease, including the jurisdiction of the Primary Hanger
Location. Lessee’s exact legal name is as shown in the caption of this Lease;
Corporate Lessee’s federal tax identification number is as respectively set
forth in Schedule No. 2; Corporate Lessee’s organizational
identification number and the address of Lessee’s mail, chief executive offices
and principal place of business are all as respectively set forth in Schedule No. 2.
Corporate Lessee agrees that it shall not change its name, organizational
number or any such address without prior written notice to Lessor. Within the
previous six (6) years Corporate Lessee has not changed its name, done
business under any other name, changed its chief place of business from its
present location, or merged or been the surviving entity


 


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of any merger, except as
disclosed to Lessor in writing. The information set forth in Schedule No. 2
pertaining to Ahern are true and correct. Lessee is “situated” in a country
that has ratified or acceded to the Cape Town Convention within the meaning of Article 4
of the Convention.


 


(b) Due
Authorization; No Violation. This Lease has been duly authorized by all
necessary action on the part of Lessee consistent with its form of
organization, does not require the approval of, or giving notice to, any
governmental authority and does not contravene or constitute a default under
any Applicable Law, certificate or articles of incorporation or organization or
by-laws or partnership certificate or agreement, or any agreement, indenture,
or other instrument to which Lessee is a party or by which it may be
bound.


 


(c) Enforceability.
This Lease has been duly executed and delivered by authorized representatives
or Lessee and constitutes a legal, valid and binding obligation of Lessee
enforceable in accordance with its terms, except to the extent that the
enforcement of remedies may be limited under applicable bankruptcy and
insolvency laws, and the equitable discretion of any court of competent
jurisdiction.


 


(d) Litigation;
Claims. There are no proceedings pending or, so far as the officers,
managers, or members of Corporate Lessee know, threatened against or affecting
Corporate Lessee or any of its property before any court, administrative
officer or administrative agency that could impair Corporate Lessor’s title to
the Aircraft or that, if decided adversely, could affect the financial
condition or operations of Corporate Lessee or the ability of Corporate Lessee
to perform its obligations under this Lease. There are no proceedings
pending or, threatened against or affecting Ahern or any of her/his property
before any court, administrative officer or administrative agency that, if
decided adversely, could affect the personal net worth or assets of Ahern or
the ability of Ahern to perform her/his obligations under the Lease.
Lessee has no pending claims and has no knowledge of any facts upon which a
future claim may be based, against any prior owner, the Manufacturer or
Supplier of the Aircraft, or of any Engine or part thereof for breach of
warranty or otherwise.


 


(e) Good
Title. Lessor will be the owner of the Aircraft as of the Acceptance Date
and will have good and marketable title to the Aircraft, free and clear of all
Liens other than any Liens created in favor of Lessor under this Lease.


 


(f) No
Competing Lienholders. No Lien exists, or will hereafter attach, against
the Aircraft, the Rent or any other rights under this Lease, or any Collateral,
or any interest of Lessee or Lessor therein (other than any Lessor’s Liens),
pursuant to any mortgage, conditional sale or security agreement or other
agreement to which Lessee or any Person claiming through Lessee is a party, nor
will any of the transactions contemplated under this Lease constitute a breach
of any provision of any such agreement. No other International Interests have
been or will be registered with the International Registry except for Permitted
Liens.


 


(g) Transacting
User Entity. Lessee is a Transacting User Entity, has appointed an
Administrator and has designated a Professional User Entity. Lessee has paid
all required fees and taken all actions necessary to enable Lessor to register
any International Interest with the International Registry.


 


(h) Power
to Lease. Lessee has the power to Lease the Aircraft from Lessor pursuant
to this Lease and to grant any security interests described herein or in any
Lease Document, each within the meaning of Article 7(b) of the
Convention.


 


(i) Consent
to International Registry Filing(s). Lessee hereby consents to the
registration of any International Interest arising in connection with this
Lease and/or any Lease Document in favor of Lessor and hereby authorizes its
Professional User Entity to consent to the registration (including all Final
Consents thereto) of any International Interest with the International Registry
upon request therefor by Lessor. At closing, Lessee hereby agrees to authorize
its Professional User Entity to consent to the registration(s) of any
International Interests.


 


3

















 


(j)
No Termination; Non-Consensual Liens. No International Interest created
in favor of Lessor shall be discharged without Lessor’s prior written consent.
Lessee shall promptly cause any non-consensual lien that is filed on the
International Registry to be discharged.


 


(k)
Engines. Each of the Engines has at least 1,750 pounds of thrust or its
equivalent.


 


(l)
Airframe. The Airframe is type certified by the FAA to transport at
least eight people (including crew) or goods in excess of 2,750 kilograms.


 


(m)
Collateral Description. The information contained on Schedule No. 1(including
the registration number of the Airframe, the serial numbers of the Airframe and
the Engines, and manufacturer and model numbers of the Airframe and Engines)
are true and accurate in all respects.


 


(n)
Not a Consumer Transaction. The transaction contemplated in this Lease
is not a “consumer transaction” as defined in the UCC and the Aircraft and any
Collateral was not or will not be purchased or held primarily for personal,
family, or household purposes.


 


SECTION 7.
NET LEASE. This Lease
is a net lease, and Lessee acknowledges and agrees that (a) Lessee’s
obligation to pay, and Lessor’s right to receive, all Rent in accordance with
this Lease shall be absolute, irrevocable, independent and unconditional and
shall not be subject to (and Lessee hereby waives and agrees not to assert) any
abatement, reduction, setoff, defense, counterclaim or recoupment
(collectively, “Abatements”) for any reason or under any circumstance
whatsoever as to any such Rent, and without limiting the foregoing, Lessee also
hereby waives any and all existing and future claims to any Abatement against
or with respect to such Rent, (b) it will pay all such Rent regardless of
any Abatement, and (c) this Lease, and Lessee’s payment and other
obligations hereunder, are non-cancelable and non-terminable by Lessee (except
as expressly provided in any Addendum).


 


SECTION 8.
TAXES. Lessee agrees
to: (a) (i) if permitted by law, file in Lessee’s own name or on Lessor’s
behalf, directly with all appropriate taxing authorities all registrations,
declarations, returns, inventories and other documentation with respect to any
personal property taxes (or any other taxes in the nature of or imposed in lieu
of property taxes) due or to become due with respect to the Aircraft, and if
not so permitted by law, to promptly notify Lessor and provide it with all
information required in order for Lessor to timely file all such declarations,
returns, inventories, or other documentation, and (ii) pay on or before
the date when due all such taxes assessed, billed or otherwise payable with
respect to the Aircraft directly to the appropriate taxing authorities or, if
such payment is not allowed under Applicable Law, directly to Lessor, (b) (i) pay
when due as requested by Lessor, and (ii) defend and indemnify Lessor on a
net after-tax basis against liability for all license and/or registration fees,
assessments, and sales, use, property, excise, privilege, value added and other
similar taxes (including any related interests or penalties) or other charges
or fees now or hereafter imposed by any governmental body or agency upon the
Aircraft or with respect to landing, airport use, manufacturing, ordering,
shipment, purchase, ownership, delivery, installation, leasing (pursuant to
this Lease, any sublease, or otherwise), chartering, operation, possession,
use, return, or other disposition thereof or the Rent or other rentals
hereunder (other than taxes on or measured solely by the net income of Lessor),
and (c) defend and indemnify Lessor against any penalties, charges,
interests or costs imposed with respect to any items referred to in (a) and
(b) above (the items referred to in (a), (b), and (c) above being
referred to herein as “Impositions”). Any Impositions which are not paid
when due and which are paid by Lessor shall, at Lessor’s option, become
immediately due from Lessee to Lessor. In addition, Lessee shall pay, indemnify
Lessor for, and hold Lessor harmless on a net after-tax basis from and against
any imposition on or measured by the net income of Lessor imposed against
Lessor by any local or foreign government or other local or foreign taxing
authority if Lessor would not have incurred such Imposition or any similar
imposition (it being acknowledged that incremental increases in net income tax
of Lessor caused by payments under this Lease are not indemnifiable if Lessor
is otherwise subject to the taxing jurisdiction of such local or foreign
government or taxing authority) but for the operation or presence of the
Aircraft within the jurisdiction imposing it. Lessee’s obligations under this Section 8
shall survive any expiration, cancellation or other termination of this Lease.


 


4

















 


SECTION 9.
COMPLIANCE, USE AND MAINTENANCE.


 


(a) Compliance
and Use. On the Acceptance Date, and at all times thereafter until the
Aircraft is returned to Lessor pursuant to this Lease, Lessee shall cause the
Aircraft to be and remain duly registered in only Lessor’s name at the FAA, in
accordance with the Transportation Code. Lessee agrees to comply with all
Applicable Law related to this Lease and/or the Aircraft, including its
operation, maintenance and security. Except as otherwise agreed to herein,
Lessee will operate the Aircraft under and in compliance with Part 91 of
the FARs, for purposes that are incidental to Lessee’s business, and in a
manner that is consistent with the transactions hereunder being deemed
commercial (and not consumer) transactions under Applicable Law. Unless
otherwise expressly permitted hereunder (it being acknowledged that the
Management Agreement is a permitted exception), Lessee shall not operate or
permit the Aircraft to be operated for air taxi operations or otherwise under Part 135
of the FARs. The Aircraft shall be used solely in a passenger configuration for
which Lessee is duly authorized by the FAA. Lessee will not operate or permit
the Aircraft to be operated in any manner at any time or in any geographic area
when or where insurance required by the provisions hereof shall not be in
effect. Unless otherwise expressly permitted by Section 12 hereof, Lessee
shall (i) retain operational control of the Aircraft at all times from the
Acceptance Date until returning the Aircraft in accordance with this Lease; and
(ii) base the Aircraft at the Primary Hangar Location, or upon written
notification to Lessor, at the New Hangar Location as set forth in Schedule No. 2.
The Aircraft will, at all times be operated by duly qualified pilots having (a) the
required FAA type rating for the Aircraft, (b) the required FAA pilot
certificates and ratings, (c) a valid FAA Medical Certificate, (d) satisfied
all security requirements imposed by any governmental authority having
jurisdiction and (e) met any and all requirements established and
specified by (i) the FAA, the Transportation Security Administration and
any other applicable government authority and (ii) the insurance policies
required under this Lease.


 


(b) Use
Outside of U.S. The Aircraft shall be operated, used and located solely
within the Continental U.S.; provided, that Lessee may fly the
Aircraft temporarily to any country in the world for any purpose expressly
permitted under this Lease. Notwithstanding the foregoing, the Aircraft shall not
be flown, operated, used or located in, to or over any such country or area
(temporarily or otherwise), (i) which is excluded from the required
insurance coverages, or would otherwise cause Lessee to be in breach of the
insurance requirements or other provisions, of this Lease, (ii) in any
area of recognized or threatened hostilities, (iii) in violation of any
Applicable Law, including any U.S. law or United Nations Security Council
Directive, (iv) to the extent that payment of any claim under the insurance
required hereunder directly or indirectly arising or resulting from or
connected with any such flight, operation, use or location would be prohibited
under any trade or other economic sanction or embargo by the United States of
America, (v) with which the U.S. does not maintain favorable diplomatic
relations, or (vi) in a manner that causes it to be deemed to have been
used or operated “predominantly” outside of the United States, as that phrase
is used in Section 168(g)(1)(A) of the Code.


 


(c) Maintenance
and Operation. During the Term, Lessee shall (i) maintain, inspect,
service, repair, overhaul and test the Airframe and each Engine and any APU in
accordance with all Maintenance Requirements, all Applicable Law, and, if more
stringent, prevailing industry standards, and (ii) maintain (in the
English language) all Records in accordance with the Applicable Law and all
Maintenance Requirements, and as required under this Lease. All maintenance
procedures shall be performed in accordance with all Applicable Law and by
properly trained, licensed, and certified maintenance sources and maintenance
personnel utilizing replacement parts approved by the FAA and the Manufacturer,
so as to keep the Airframe and each Engine, any APU and each Part in good
operating condition, ordinary wear and tear, from proper use alone, excepted,
and to enable the airworthiness certificate for the Aircraft to be continually
maintained. Without limiting the foregoing, Lessee shall comply with all
mandatory service bulletins and airworthiness directives by causing compliance
to such bulletins and/or directives to be completed through corrective
modification in lieu of operating manual restrictions.


 


(d) Loaner
Engines. In the event any Engine is damaged, being inspected, repaired or overhauled
and provided no Event of Default or Default has occurred. Lessee, at its
option, may temporarily substitute another engine of the same make and
model as the Engine being repaired or overhauled (any such


 


5

















 


substitute engine being
hereinafter referred to as a “Loaner Engine”) during the period of such
repair or overhaul, and provided further (i) installation of the Loaner
Engine is performed by a maintenance facility certified by the FAA and manufacturer
with respect to an aircraft of this type, (ii) the Loaner Engine is
removed and the repaired or overhauled original Engine is reinstalled on the
Airframe promptly upon completion of the repair or overhaul but in no event
later than the earlier of ninety (90) days after removal, or the expiration,
cancellation or earlier termination of this Lease, and (iii) the Loaner
Engine is free and clear of any Lien that might impair Lessor’s rights or
interests in the Aircraft and is maintained in accordance herewith.


 


(e) Additions,
Alterations and Replacement Parts. Lessee may install on the Aircraft
any additional accessory, device or equipment (“Additions”) but only if
such Additions (i) are ancillary to the Aircraft; (ii) are not
required to render the Aircraft complete for its intended use by Lessee; (iii) will
not impair the originally intended function or use of the Aircraft or diminish
the value of the same; (iv) can be readily removed without causing
material damage to the Aircraft; and (v) do not result in a Tax Loss.
Title to each Addition not removed prior to the return of the Aircraft to
Lessor shall immediately vest in Lessor upon such return without any payment
by, or any cost or expense to, Lessor. Lessee shall make any alteration or
modification (“Alterations”) to the Aircraft that may at any time
during the Term be required to comply with airworthiness directives or other
Applicable Law. Lessee will promptly replace all Parts that become worn out,
lost, stolen, taken, destroyed, damaged beyond repair or permanently rendered
or declared unfit for use for any reason whatsoever. Lessee shall repair all
damage to the Aircraft resulting from the installation and removal of Additions
and/or Alterations so as to restore the Aircraft to its condition prior to
installation. Alterations and/or replacement parts shall be deemed accessions,
and title thereto shall be immediately vested in Lessor without cost or expense
to Lessor. Except as permitted under this Section 9(e), Lessee will not
modify the Aircraft (including any change in configuration) or affix or remove
any accessory to the Aircraft leased hereunder.


 


(f) Aircraft
Marking. Lessee agrees to (i) prominently display on the Aircraft the
FAA Registration number, specified in Schedule No. 1 or such other “N”
number as has been approved by and exclusively reserved to Lessor in its name
and duly recorded with the FAA; and (ii) notify Lessor in writing thirty
(30) days prior to making any change in the appearance or coloring of the
Aircraft.


 


(g) Security.
Without limiting Lessee’s indemnities and other agreements under this Lease,
Lessee hereby: (i) expressly assumes sole responsibility for the
determination and implementation of all security measures and systems necessary
or appropriate for the proper protection of the Aircraft (whether on the ground
or in flight) against theft, vandalism, hijacking, destruction, bombing,
terrorism or similar acts directly or indirectly affecting the Aircraft, any part thereof,
or any persons who (whether or not on board the Aircraft) may sustain any
injury or damage as a result of any such acts, and (ii) agrees to provide
to Lessor promptly upon request with evidence of Lessee’s compliance with its
obligations under this Section 9(g) (but in no event shall Lessor, in
its capacity as lessor, owner or otherwise, be deemed to have any duty with
respect to any security measures imposed by this Lease or Applicable Law,
whether or not complied with the Lessee, and (iii) acknowledges and agrees
that its full and exclusive assumption of responsibility for the matters
covered in this Section 9(g) are of the essence of this Lease and a
condition to Lessor’s participation in the transactions contemplated herein).


 


SECTION 10.
LOSS OR DAMAGE.


 


(a) Event
of Loss with Respect to the Aircraft. Upon the occurrence of any Event of
Loss with respect to the Airframe and/or Aircraft, Lessee shall notify Lessor
within five (5) days of the date thereof. On (i) the next Basic Rent
Date following the date of such notice, or (ii) if such Event of Loss occurs
after the Last Basic Rent Date, within thirty (30) days after such notice (any
such date described in subclause (i) or (ii) above the “Casualty
Payment Date”), Lessee shall pay to Lessor any Rent then due, plus the
Casualty Value of the Aircraft determined as of the Casualty Payment Date, (but
if the Casualty Payment Date is after the last Basic Rent Date, the Casualty.
Value for such date shall be the amount equal to the Lessor’s Cost multiplied
by the applicable percentage set forth on Schedule No. 3 for the last
Basic Rent Date or the corresponding Basic Rent number), together with interest
at the Late Payment Rate for the period (if any) from the Casualty Payment Date
through the date of payment. Upon making the applicable payment


 


6

















 


required hereby, Lessee’s
obligation to pay further Basic Rent for the Aircraft subsequent to such
payment shall cease, but Lessee shall remain liable for, and pay as and when
due, all Supplemental Rent. If recoverable, Lessor shall be entitled to recover
possession of the Aircraft and to any salvage value in excess of the Casualty
Value paid to Lessor, but subject to the requirements of any third party
insurance carrier in order to settle an insurance claim. Lessor shall be
entitled to receive and retain all amounts payable by the Manufacturer with
respect to a Return to manufacturer or by any governmental authority with
respect to any Requisition of Use, as the case may be, except that such
amounts received in good collected funds shall be applied against Lessee’s
obligation to pay Casualty Value and any other amounts then payable to Lessor
under the Lease Documents or, so long as no Event of Default has occurred,
remitted to Lessee (up to the amount of the Casualty Value paid by Lessee to
Lessor in good and indefeasible funds). Lessor shall be under no duty to Lessee
to pursue any claim against any Person in connection with an Event of Loss.


 


(b) Event
of Loss with Respect to an Engine or an APU. Upon an Event of Loss with respect
to any Engine or any APU, but not the Airframe on which it was installed,
Lessee shall (i) give Lessor prompt written notice thereof, (ii) by
the earlier of the ninetieth (90th) day after the occurrence of such
Event of Loss or the receipt of the applicable insurance proceeds, if any, duly
convey to Lessor title to an engine or APU, as applicable, of the same make and
model number as the Engine or any APU suffering the Event of Loss, and (iii) comply
with the other provisions of this Section 10(b). Such engine or any APU,
as applicable, shall be free and clear of all Liens, have a value, utility, and
useful life at least equal to, and be in as good an operating condition as, the
Engine or any APU suffering the Event of Loss, assuming such Engine or any APU
was in the condition and repair required by the terms hereof immediately prior
to the occurrence of such Event of Loss. Lessee shall furnish to Lessor such
documents to evidence such conveyance as Lessor shall request. Upon full
compliance by Lessee with the terms of this paragraph, Lessor will transfer to
Lessee all of Lessor’s right, title and interest, if any, in and to such Engine
or any APU, which transfer shall be “AS-IS,
WHERE-IS”. Each such replacement engine or APU, as applicable,
shall, after such conveyance to Lessor, be deemed as “Engine” or “APU”,
as applicable, as defined herein and shall be deemed part of the same
Aircraft as was the Engine or any APU replaced thereby.


 


(c) Risk
of Loss. Lessee shall bear the risk of loss, theft, confiscation, taking,
unavailability, damage or partial destruction of the Aircraft and shall not be
released from its obligations hereunder in the event of any damage or Event of
Loss to the Aircraft or any part thereof. Without limiting any other
provision hereof, Lessee shall repair all damage to the Aircraft from any and
all causes, including as provided in Sections 9(c) and (e), and shall
provide written notice to Lessor of any Material Damage concurrently with its
report of same to the applicable governmental authority, and if no such report
is required, within ten (10) days of the occurrence of such damage. The
required notice must be provided together with any damage reports provided to
the FAA or any other governmental authority, the insurer or Supplier, and any
documents pertaining to the repair of such damage, including copies of work
orders, and all invoices for related charges.


 


(d) Credit
for Insurance Payments. If Lessor receives a payment under an insurance
policy required under this Lease in connection with an Event of Loss of an
Airframe and/or an Engine or any APU, and such payment is both unconditional
and indefeasible, then provided no Default or Event of Default shall have
occurred, and Lessee shall have compiled with the provisions of Section 10(a) or
10(b), Lessor shall either (i) remit such proceeds to Lessee up to an
amount equal to (A) the amount paid by Lessee to Lessor as the Casualty
Value pursuant to Section 10(a), or (B) the amount of the replacement
costs actually incurred by Lessee with respect to the replacement of any Engine
or APU pursuant to Section 10(b), or (ii) credit such proceeds
against any amounts owed by Lessee pursuant to Section 10(a). Any excess
insurance proceeds shall be retained by Lessor.


 


SECTION 11.
INDEMNIFICATION.
Lessee shall indemnify, protect, save, defend and keep harmless Lessor, its
agents, employees, officers, directors, shareholders, subsidiaries, affiliates
and Assignees (each an “Indemnitee”), on a net after-tax basis, from and
against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, suits, demands, costs, expense and disbursements (including
legal fees and expenses) of any kind and nature whatsoever (“Claims”) which may be
imposed on, incurred by or asserted against any Indemnitee, whether or not such
Indemnitee shall also be


 


7

















 


indemnified as to any such
Claim by any other Person, in any way relating to or arising out of (a) this
Lease or any of the other Lease Documents, or the performance, breach
(including any Default or Event of Default) or enforcement or any of the terms
hereof or thereof, or (b) the Aircraft, including the assertion or
enforcement of any manufacturer’s, vendor’s, dealer’s or other supplier’s
warranties on the Aircraft or any part thereof, or the manufacture,
inspection, construction, purchase, pooling, interchange, acceptance,
rejection, ownership, titling or re-titling, delivery, lease, sublease,
charter, possession, use, operation, maintenance, management, security,
condition, registration or re-registration, sale return, removal, repossession,
storage or other disposition of the Aircraft or any part thereof or any
accident in connection therewith, including, Claims involving or alleging
environmental damage, criminal acts, hijacking, acts of terrorism or similar
acts, product liability or strict or absolute liability in tort, latent and
other defects (whether or not discoverable), for patent, trademark or copyright
infringement and for any other risk or matter, the responsibility for which
Lessee has agreed to bear in Section 5, including any of the same that
result in injuries, death, destruction, or other harm or loss to Persons or
property, without regard as to who may have operational control of the
Aircraft from time to time. Notwithstanding the foregoing. Lessee shall not be
required to indemnify an Idemnitee under this Section 11 for (i) any
Claim caused solely and directly by the gross negligence or willful misconduct
of such Indemnitee (except as imputed by law), (ii) any impositions, or (iii) any
Claim in respect of the Aircraft arising from acts or events which occur after (A) the
Aircraft has been redelivered to Lessor in accordance with this Lease, and (B) any
and all other obligations of any kind whatsoever of Lessee under this Lease
have been fully paid or performed, as the case may be, unless any such
Claims were caused by Lessee, or anyone claiming through Lessee, or resulted
directly or indirectly, from any acts, events, or omissions of any kind
whatsoever during the Term of this Lease. Lessee’s obligations under this Section 11
shall survive any expiration, cancellation or other termination of this Lease.
If any Claim is made against Lessee or an Indemnitee, the party receiving
notice of such Claim shall promptly notify the other, but the failure of the
party receiving notice to so notify the other shall not relieve Lessee of any
obligation hereunder.


 


SECTION 12.
ASSIGNMENT AND SUBLEASE.


 


(a) Lessee’s
Conveyances; and Liens. Except as expressly permitted below, Lessee shall
not sell (or offer or advertise the sale of), assign, charter, sublease,
timeshare, pool, interchange, convey, mortgage or otherwise transfer or
encumber this Lease, the Aircraft, including any Engine, any APU or any Part or
any Collateral, or its interest with respect thereto, and any such transfer or
encumbrance, whether by operation of law or otherwise, shall be null and void,
in all respects. In addition, Lessee shall not relinquish possession of the
Airframe, any APU, or any Engine or Part or install any APU or any Engine
or Part, or permit any APU or any Engine or Part to be installed, on any
Airframe other than the Airframe leased hereunder except as expressly set forth
herein. The foregoing shall not be deemed to prohibit the delivery of
possession of the Aircraft, any APU, any Engine or Part to another Person
for testing, service, repair, maintenance, overhaul or, to the extent permitted
hereby, for alteration or modification. Lessee will not create or suffer to
exist any Liens on or with respect to the Aircraft, any APU, any Engine or
Part, any Collateral, or Lessee’s interest therein other than Permitted Liens.
Lessee will promptly take such action as directed by Lessor to duly discharge
any such Lien. If Lessee fails to remove a Lien, Lessor may take such
action as it deems appropriate to remove such Lien, but without waiving its
other rights hereunder. Lessee shall reimburse Lessor on demand for any costs
incurred by Lessor in connection with such action, together with interest at
the Late Payment Rate.


 


Notwithstanding the
foregoing, provided that no Default or Event of Default has occurred and is
continuing, Lessee may contract with Manager to provide certain management
services with respect to the Aircraft, and to charter the Aircraft to any
customer of Manager from time to time pursuant to the Management Agreement, in
each case, as specified in the Consent to Management Agreement, subject to the
satisfaction of the following conditions: (i) Manager (A) is and
remains a solvent, domestic company holding a current and valid Air Carrier
Certificate issued by the FAA, and (ii) the Management Agreement and any
such charter entered into pursuant thereto (A) do not convey any Lien or
other interest in or against the Aircraft, and (B) expressly (1) remain,
subject and subordinate to this Lease and the rights of Lessor hereunder and in
and to the Aircraft, (2) do not permit any further disposition, (3) do
not contain provisions that are inconsistent with the provisions of this Lease
or cause Lessee to breach any of its representations, warranties or agreements
under this Lease, and (4) otherwise conform to the Consent to


 


8

















 


Management Agreement. Lessor
acknowledges that certain of the duties and obligations of Lessee hereunder may be
performed by Manager, however, this acknowledgment on the part of Lessor
does not constitute an acceptance by Lessor of such performance by Manager of
such duties and obligations unless the performance of such duties and
obligations fully and completely satisfies the requirements of this Lease. The
terms and conditions of the Consent to Management Agreement are hereby
incorporated herein by their reference. No such arrangement by Lessee will reduce
any of the obligations of Lessee hereunder or the rights of Lessor hereunder,
and all of the obligations of Lessee hereunder shall be and remain primary and
shall continue in full force and effect as the obligations of a principal and
not of a guarantor or surety.


 


(b)       Lessor’s Conveyances. Lessor, may at
any time, with or without notice to Lessee, grant a security interest in, sell,
assign or otherwise transfer (an “Assignment”) all or any part of
its interest in the Lease Documents, any Associated Rights, or the Aircraft or
any Rent due or to become due hereunder, and Lessee shall perform all of
its obligations under the Lease Documents, to the extent so transferred, for
the benefit of the beneficiary of such Assignment (such beneficiary, including
any successors and assigns, an “Assignee”) except that the interest of
any such Assignee shall be subject to Lessee’s rights to the extent provided in
this Lease. Lessee hereby consents to any such grant, sale, assignment or
transfer by Lessor, including, without limitation, for purposes of the Cape
Town Convention. Lessee waives any right and agrees not to assert against any
Assignee any defense, setoff, recoupment, claim, counterclaim or any other
Abatement that Lessee may have against Lessor, unless expressly assumed by
such Assignee, in which case, Lessor shall be relieved of any such assumed
obligations. The foregoing waiver is not intended to contradict or otherwise
limit or modify the provisions of Section 7. If so directed in writing,
Lessee shall pay all Rent and all other sums due or to become due under the
Lease Documents and/or any Associated Rights directly to the Assignee or any
other party designated in writing by Lessor. Lessee acknowledged and agrees
that Lessor’s right to enter into an Assignment is essential to Lessor, and,
accordingly, waives any restrictions under Applicable Law with respect to an
Assignment and any related remedies. Upon the request of Lessor or any
Assignee, Lessee also agrees (a) to promptly execute and deliver to Lessor
or to such Assignee an acknowledgment of assignment in form and substance
satisfactory to the requesting party, an insurance certificate, an
International Registry filing (and any necessary consent thereto, as well as
any renewal of any authorization required by the International Registry in
connection with such filing, such as renewing its Transacting User Entity
status and re-designating a Professional User Entity, if necessary in Lessor’s
judgment) and such other documents and assurances reasonably requested by
Lessor or Assignee, and (b) to comply with the reasonable requirements of
any such Assignee in order to perfect any such assignment or transfer.


 


(c)       Successors and Assigns. This Lease
shall be binding upon and inure to the benefit of, and may be enforced by (i) Lessor
and it successors and other Assignees, or other express third party
beneficiaries, and (ii) Lessee and its successors and assigns (subject to Section 12(a) hereof).


 


SECTION 13.
EVENTS OF DEFAULT AND REMEDIES.


 


(a)       Events of Default. The term “Event
of Default” means (i) non-payment of any Basic Rent, Supplemental Rent
(including Casualty Value, if applicable) and/or any other amount due pursuant
to any Rider, Addendum (except as provided in clause (vi) below) or
Supplement hereto within ten (10) days after any or all of the same shall
become due and payable, or, any other amount required to be paid herein or
under any other agreement with Lessor within ten (10) days after demand; (ii) failure
to maintain, use, or operate the Aircraft in compliance with Applicable Law; (iii) any
use of the Aircraft outside of the U.S. that is prohibited by this Lease, or
use for any illegal purpose; (iv) failure to obtain, maintain and/or
comply with all of the insurance coverages required under this Lease; (v) any
prohibited transfer or encumbrance, or the existence of any unpermitted Lien,
or any other action or circumstance that is prohibited by, or any violation of,
Section 12(a) hereof; (vi) failure to return the Aircraft to
Lessor on the date and in the manner required by this Lease; (vii) a
default by Lessee under any loan, note, security agreement, lease, guaranty,
conditional sale or other agreement with, or other financial obligation to,
Lessor or its Affiliates where the amount involved exceeds $500,000.00; (viii) a
default by Lessee in any payment or other obligation to any Person other than
Lessor or its Affiliates where the amount involved exceeds $500,000.00; (ix) a
material inaccuracy in any representation or breach of warranty by Lessee (including
any false or misleading


 


9

















 


representation or warranty)
in any financial statement or Lease Document; (x) the commencement of any
bankruptcy, insolvency, receivership or similar proceeding by or against Lessee
or any of its properties or business (unless, if involuntary, the proceeding is
dismissed within sixty (60) days of the filing thereof) or the rejection of
this Lease or any other Lease Document in any such proceeding; (xi) the failure
by Lessee generally to pay its debts as they become due or its admission in
writing of such inability; (xii) the occurrence of any of the following events
shall occur with respect to Corporate Lessee: (A) Corporate Lessee enters
into any transaction of merger or consolidation, unless Lessee is the surviving
corporation; (B) Corporate Lessee ceases to do business as a going
concern, or liquidates, or dissolves; (C) Corporate Lessee sells,
transfers, or otherwise disposes of all or substantially all of its assets or
property, or enters into a leveraged buyout; (D) Corporate Lessee changes
the form of organization of its business; (E) Ahern shall cease to
own, directly or indirectly, at least 51% of the outstanding voting capital
stock of Corporate Lessee; or (F) (Intentionally omitted); (xiii) a
material adverse change in the business, operations, financial reporting, or
financial condition of Lessee or in its ability to comply with any Lease
Documents since the date of this Lease; (xiv) failure by Lessee to notify Lessor
of any Default or Event of Default within ten (10) days of Lessee’s
awareness of such Default or Event of Default; (xv) breach by Lessee or Manager
of any other covenant, condition or agreement (other than those in items
(i)-(xiv)) under this Lease or any of the other Lease Documents that continues
for thirty (30) days after Lessor’s written notice to Lessee (but such notice
and cure period will not be applicable unless such breach is curable by
practical means within such notice period); or (xvi) the occurrence of a Change
of Control.


 


(b)       Remedies. If an Event of Default
occurs, Lessor may exercise any one or more of the following remedies (in
its sole discretion): (i) proceed at law or in equity, to enforce
specifically Lessee’s performance or to recover damages; (ii) declare this
Lease in default, and/or cancel this Lease or otherwise terminate Lessee’s
right to use of the Aircraft and Lessee’s other rights, but not its obligations
under this Lease, and Lessee shall immediately return the Aircraft to Lessor in
accordance with the terms of this Lease; (iii) enter the premises where
the Aircraft is located and take immediate possession of and remove (or disable
in place) the Aircraft (and/or the APU, any Engines and Parts then unattached
to the Aircraft) by self-help, summary proceedings or otherwise without
liability; (iv) use Lessee’s premises for storage as set forth in this
Lease without liability; (v) sell, re-lease or otherwise dispose of the
Aircraft (or any Engine or Part), whether or not in Lessor’s possession , at
public or private sale, with or without notice to Lessee, and apply or retain
the net proceeds of such disposition, with Lessee remaining liable for any
deficiency and with any excess being retained by Lessor, or keep the Aircraft
idle; (vi) apply and deposit or other cash collateral, or any proceeds of
any Collateral, at any time to reduce any amounts due to Lessor; (vii) demand
and recover from Lessee the Liquidated Damages and other Rent whenever the same
shall be due; (viii) terminate the Management Agreement and any charter,
without regard as to the existence of any event of default thereunder and
recover, or cause Lessee and Manager to relinquish possession and return the
Aircraft, including the Engines and Parts, pursuant to this Section 13,
and/or exercise any and all other remedies under the Consent to Management
Agreement, or in Lessee’s stead, to the extent provided for under, or otherwise
available to Lessee in connection with the Management Agreement; and (ix) exercise
any and all other remedies (and interim remedies) allowed by Applicable Law,
including, without limitation, the Cape Town Convention (except as expressly
waived by the parties herein) and the UCC. Without limiting the generality of
the foregoing, (A) upon the occurrence of an Event of Default, Lessor may,
among other things, demand and recover from Lessee the Casualty Value
(calculated as contemplated in the definition of Liquidated Damages) or other
applicable Liquidated Damages (in lieu of future Basic Rent, and not as a
penalty) and other Rent then due, and/or demand that Lessee return the Aircraft
in accordance with this Lease; and (B) if Lessee returns the Aircraft, and
after Lessor disposes of it, Lessor will determine the amount, if any, of any
credit or reimbursement or deficiency, as applicable, with respect to Lessee’s
obligation to pay such Casualty Value or other Liquidated Damages (all as
contemplated in the definition of such term).


 


(c)       Lessor’s
Performance. If Lessee fails to perform any of its agreements
contained in this Lease, including its obligations to keep the Aircraft free of
Liens, comply with Applicable Law, or obtain the requisite insurance coverages,
Lessor shall have the right, but shall not be obligated, to effect such
performance and any expenses incurred by Lessor in connection with effecting
such performance, together with interest thereon at the Late Payment Rate,
shall be payable by Lessee promptly upon demand. Any such action shall not be a
cure or waiver of any Default or Event of Default hereunder.


 


10
















 


(d)                    Power-of-Attorney. Lessee irrevocably appoints Lessor as its
attorney-in-fact to act in Lessee’s name and on its behalf to make, execute,
deliver and file any instrument or documents (including any filings at the
FAA), settle, adjust, receive payment, make claim or proof of loss, endorse
Lessee’s name on any checks, drafts or other instruments in payment of any
insurance claims and to take any action as Lessor deems necessary or
appropriate to carry out the intent of this Lease; provided, however,
Lessor agrees that it will not exercise this power unless an Event of Default
has occurred or a Default has occurred and is continuing. This appointment is
coupled with an interest, is irrevocable, and shall terminate only upon payment
in full of the obligations set forth in this Lease and/or any other Lease
Documents.


 


(e)                     Enforcement Costs. Lessee shall be liable for, and pay to
Lessor upon demand, all costs, charges and expenses incurred by Lessor in
enforcing or protecting its rights under this Lease, whether by reason of any
Default or Event of Default, or otherwise, including, legal fees,
disbursements, insurance, expert witness fees, consultant fees, repossession,
taxes, lien removal, recovery, storage, inspection, appraisal, repair, costs of
transportation, refurbishing, advertising and brokers’ fees, and other carrying
costs and costs of sale, re-lease or other disposition of the Aircraft.


 


(f)                       Cumulative Remedies, Etc. No right or remedy is exclusive. Each may be
used successively and cumulatively and in addition to any other right or remedy
referred to above or otherwise available to Lessor at law or in equity,
including, such rights and/or remedies as are provided for in the Cape Town
Convention and/or the UCC, but in no event shall Lessor be entitled to recover
any amount in excess of the maximum amount recoverable under Applicable Law
with respect to any Event of Default. No express or implied waiver by Lessor of
any Default or Event of Default hereunder shall in any way be, or be construed
to be, a waiver of any future or subsequent Default or Event of Default. The
failure or delay or Lessor in exercising any rights granted it hereunder upon
the occurrence of any of the contingencies set forth herein shall not
constitute a waiver of any such right upon the continuation or reoccurrence of
any such contingencies or similar contingencies, and any single or partial
exercise of any particular right by Lessor shall not exhaust the same or
constitute a waiver of any other right provided for or otherwise referred to
herein. Lessee hereby waives any rights under the UCC and/or the Cape Town
Convention to cancel or repudiate this Lease or any of the other Lease
Documents, to rejects or revoke acceptance of the Aircraft or any component
thereof, to suspend performance, and to recover from Lessor any general,
special, incidental or consequential damages, for any reason whatsoever. All
remedies set forth herein shall survive the expiration, cancellation or other
termination of this Lease for any reason whatsoever.


 


SECTION 14.
NOTICES, REPORTS, FURTHER ASSURANCES AND INSPECTIONS.


 


(a)                     Notices. All communications and notices provided for herein shall be in
writing and shall become effective (i) upon hand delivery, or (ii) upon
delivery by an overnight delivery service, or (iii) upon two (2) Business
Days after being deposited in the U.S. mail with proper postage for first-class mail
prepaid, sent by certified mail, return receipt requested, and addressed to
Lessor or Lessee at their respective addresses set forth under the signatures
hereto or such other address as either party may hereafter designate by
written notice to the other, or (iv) when sent by telecopy (with customary
confirmation of receipt of such telecopy) on the Business Day when sent or upon
the next Business Day if sent on other than a Business Day.


 


(b)                    Reports. Lessee will provide Lessor with the following in writing within the
time periods specified: (i) notice of any Lien which attaches to the
Aircraft, and the full particulars of the Lien, within ten (10) days after
Lessee becomes aware of the Lien; (ii)(A) Corporate Lessee’s balance sheet
and statement of retained earnings, statement of operations and statement of
cash flows prepared in accordance with GAAP, certified by a recognized firm of
certified public accountants, within ninety (90) days of the close of each
fiscal year of Corporate Lessee, (B) Corporate Lessee’s management
prepared financial statements (balance sheet, statement of operations,
statement of cashflows and stockholders equity) certified by the chief
financial officer of Corporate Lessee, within sixty (60) days of the close of
each fiscal quarter of Corporate Lessee, (C) all of Corporate Lessee’s
Forms 10-K and 10-Q, if any, filed with the SEC within thirty (30) days after
the date on which they are filed (by furnishing these SEC Forms,


 


11

















 


or making them publicly
available in electronic form, Lessee shall be deemed to have satisfied the
requirements of clauses (b)(ii)(A), (B), or (C)); (iii) notice to Lessor
of any change of the Primary Hangar Location (including the change to the New
Hangar Location, as set forth in Schedule No. 2), ten (10) days
prior to any such change; (iv) notice of any loss of damage to the
Aircraft in accordance with Section 10; (v) notice of any accident
involving the Aircraft causing bodily injury or properly damage to third
parties, within five (5) days of such accident; and (vi) ten (10) days
prior to the policy expiration date for any insurance coverage required by this
Lease, evidence (having the form and substance consistent with Section 2(g) of
the Closing Terms Addendum) of the renewal or replacement of such coverage
complying with the terms hereof. Lessee will also provide Lessor with the
following in writing promptly upon Lessor’s request: (1) a copy of any
insurance policy required by this Lease; (2) notice to Lessor of the
Aircraft’s location, and the location of all Records relating to the Aircraft
and its use, maintenance and/or condition; (3) such information as may be
necessary to enable Lessor to file any reports required by any governmental
authority due to Lessor’s ownership of the Aircraft; (4) copies of any
manufacturer’s maintenance service program contract for the Airframe or
Engines; (5) copies of all Records evidencing Lessee’s compliance with FAA
airworthiness directives and mandatory service bulletins and of compliance with
the provisions of Section 9 hereof and of the Return Addendum to this
Lease, and any other requested Records; and (6) such other reports or
information as Lessor may reasonably request. Lesee hereby acknowledges
that any credit and other information regarding Lessee or any of its affiliates
may be shared by Lessor with its affiliates and agents.


 


(c)                     Further Assurances. Lessee will promptly execute or otherwise
authenticate any documents, filings and other records, including, amendments to
this Lease, UCC, FAA, Cape Town Convention, International Registry or other
applicable filings and acknowledgements of assignment, and will take such
further action as Lessor may reasonably request in order to carry out more
effectively the intent and purposes of this Lease and to establish and protect
Lessor’s rights and remedies under this Lease, or otherwise with respect to the
Aircraft and/or the Collateral. Lessee irrevocably authorizes Lessor to file
UCCs or other filings with respect to the Aircraft or Collateral. Lessee agrees
not to file any corrective or termination statements with respect to any UCC or
other filings relating to the Aircraft or any Collateral.


 


(d)                    Inspection. Lessor shall have the right, but not the duty, to inspect the
Aircraft, any component thereof and/or the Records, at any reasonable time and
from time to time, wherever located, upon reasonable prior written notice to
Lessee; except that no advance notice shall be necessary prior to any
inspection conducted, and such inspection may be conducted at any time,
after the occurrence of a Default or an Event of Default. Upon request of
Lessor, Lessee shall promptly confirm to Lessor the location of the Aircraft
and/or the Records. Lessee shall be responsible for the cost of any inspection
conducted after the occurrence of a Default or an Event of Default, and shall
pay Lessor such amount as additional Rent within ten (10) days of demand.


 


SECTION 15.
TRANSACTION EXPENSES.
Without limiting any other provision of this Lease, Lessee shall perform and
comply with all of its obligations, and possess, use, operate, insure,
maintain, and comply with Applicable Law, service, return and/or store the
Aircraft (or cause any or all of the same to be done) and take all other
actions contemplated in this Lease and the other Lease Documents at its sole
risk, cost and expense. Lessee shall pay all fees, costs and expenses incurred
by or on behalf of Lessor at any time in connection with this Lease, whether or
not the transactions contemplated hereby are consummated, including, without
limitation, appraisal and inspection fees, Lessor’s counsel and FAA Counsel’s
fees and expenses, UCC, FAA, Cape Town Convention, International Registry or
other applicable title and lien searches, reports, filing and recording fees,
charges and taxes, and costs and expenses incurred in connection with Lessee’s
exercise of any option or other right granted under, or any amendment or other
modification to any of, the Lease Documents.


 


SECTION 16.
MISCELLANEOUS.


 


(a)                     Interpretation. Time is of the essence in the payment and
performance of all of Lessee’s obligations under this Lease. Any provision of
this Lease that may be determined to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective in such
jurisdiction to the extent


 


12

















 


thereof without invalidating
the remaining provisions of this Lease, which shall remain in full force and
effect. The division of this Lease into sections, the provision of a table of
contents and the insertion of headings are for convenience of reference only
and shall not affect the construction or interpretation of this Lease. The
execution hereof on behalf of Lessee and Lessor shall be deemed to constitute
the acceptance by Lessee and Lessor of the terms and conditions of each and
every addendum, rider, supplement, schedule, annex and exhibit hereto as
if such document was separately and individually executed on behalf of such
party hereto and shall constitute a part of this Lease. THIS LEASE MAY BE
EXECUTED IN ANY NUMBER OF COUNTERPARTS AND BY THE PARTIES HERETO ON SEPARATE
COUNTERPARTS. ONLY COUNTERPART NO. 1 OF THIS LEASE AND THE LEASE
SUPPLEMENT SHALL BE CONSIDERED “CHATTEL PAPER” FOR PURPOSES OF THE UCC.


 


(b)                    Granting Clause. In order to secure the prompt and full
payment and performance as and when due of any and all obligations and indebtedness
of Lessee to Lessor, now existing or hereafter created of any kind whatsoever,
Lessee hereby collaterally assigns, grants, and conveys to Lessor, a security
interest in and lien on all of Lessee’s right, title and interest in and all of
the following (the “Collateral”): (i) this Lease and any present
and future subleases, management agreements, interchange agreements, charter
agreements, Associated Rights and any other present and future agreements of
any kind whatsoever relating to the Aircraft or any part thereof and all
rent, charter payments, reimbursements and other disbursements, remittances or
other amounts payable with respect thereto; (ii) (in the event that
contrary to the intentions of Lessee and Lessor, a court determines that this
Lease is not a “true” lease under the UCC) the Aircraft and all present and
future parts, accessories, accessions, Associated Rights and attachments
thereto, and all present and future replacements, substitutions and exchanges
for such goods; and (iii) proceeds of the foregoing, including all related
goods, accounts, Associated Rights, chattel paper, documents, instruments,
general intangibles, letters of credit, letters of credit rights, investment
property, deposit accounts, and supporting obligations, insurance proceeds,
warranty and requisition payments, and all present and future books and records
relating to any of the foregoing and/or the Aircraft (including, without
limitation, all tapes, cards, computer programs, computer runs and computer
data in the possession or control of Lessee, any computer service bureau, or
other third party). The collateral assignments, security interest and lien
granted herein shall survive the termination, cancellation or expiration of
this Lease until such time as Lessee’s obligations under this Lease are fully
and indefeasibly discharged.


 


(c)                     Mandatory Prepayment. Lessee is or may become indebted under
or in respect of one or more leases, loans, notes, credit agreements,
reimbursement agreements, security agreements, title retention or conditional
sales agreements, or other documents, instruments or agreements, whether now
existing or hereafter arising, evidencing Lessee’s obligations for the payment
of borrowed money or other financial accommodations owing to one or more Affiliates
of Lessor or any of its successors by merger or otherwise (“Affiliated
Obligations”). If Lessee pays or prepays all or substantially all of its
Affiliated Obligations, whether or not such payment or prepayment is
voluntarily or involuntarily made by Lessee before or after any default or
acceleration of such Affiliated Obligations, or if the Affiliated Obligations
are otherwise terminated or Lessor or any of its Affiliates is no longer party
thereto, then Lessee shall pay, at Lessor’s option and immediately upon notice
from Lessor, on the next Basic Rent Date immediately following the date of any
demand for payment by Lessor, an amount equal to the Lessor’s Cost multiplied
by the percentage set forth on Schedule No. 3 as applicable to or for
any such next Basic Rent Date plus all Rent then due, owing or outstanding to
Lessor and any and all other amounts then due and owing. All amounts or
payments due or payable to Lessor pursuant to the foregoing sentence shall be
paid in immediately available fund via wire transfer to any account specified
by Lessor (or paid as otherwise determined by Lessor in its sole discretion).
Upon receipt of the amounts specified in the preceding sentence, Lessor shall
sell the Aircraft to Lessee on an “AS-IS, WHERE IS” BASIS, WITHOUT ANY
REPRESENTATION BY, OR RECOURSE OR WARRANTY, EXPRESS OR IMPLIED, OF ANY KIND
WHATSOEVER TO LESSOR other than as to there being no Lessor’s liens.


 


(d)                    Entire Agreement. This Lease, and each of the other Lease
Documents, the Purchase Documents, and Required Documents, collectively
constitute, and are intended to collectively constitute, the complete and
exclusive statement of the terms of the between Lessor and Lessee with respect
to the purchase and leasing of the Aircraft. This Lease, the Purchase
Documents, and the other Required


 


13

















 


Documents cancel and
supersede any and all prior or contemporaneous oral or written understandings,
memoranda, negotiations, communications, agreements, and other records, with
respect thereto including, any proposal letter, commitment letter, and/or term
sheet delivered to Lessee by Lessor, or to Lessor by Lessee. NO TERM OR
PROVISION OF THIS LEASE MAY BE AMENDED, ALTERED, WAIVED, DISCHARGED, OR
TERMINATED EXCEPT IN A WRITING SIGNED BY A DULY AUTHORIZED OFFICER OF THE PARTY
AGAINST WHOM THE ENFORCEMENT OF THE AMENDMENT, ALTERATION, WAIVER, DISCHARGE OR
TERMINATION IS SOUGHT.


 


(e)                     Governing Law, Choice of Forum and Jury Trail
Waiver. Lessee acknowledges
and agrees that this Lease has been executed and delivered in Rhode Island;
however, BOTH PARTIES AGREE THAT THIS LEASE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF BOTH PARTIES SHALL BE GOVERNED BY, THE
INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAWS
PRINCIPLES OF SUCH STATE, OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK
GENERAL OBLIGATIONS LAW), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY, AND
PERFORMANCE. Lessee hereby irrevocably consents and agrees that any legal
action, suit, or proceedings arising out of or in any way in connection with
this Agreement may be instituted or brought in the courts of the State of
New York or the U.S. District Court for the Southern District of New York, as
Lessor may elect, and by execution and delivery of this Lease, Lessee
hereby irrevocably accepts and submits to, for itself and in respect of its
property, generally and unconditionally, the non-exclusive jurisdiction of any
such court, and to all proceedings in such courts. Notwithstanding the
foregoing, the parties may bring a judicial proceeding in the Republic of
Ireland against the registrar of the International Registry solely and to the
extent such proceeding seeks relief from the International Registry. EACH OF THE
PARTIES HERETO ALSO HEREBY KNOWINGLY AND FREELY WAIVES ALL RIGHTS TO TRIAL BY
JURY IN ANY LITIGATION ARISING HEREFROM OR IN RELATION HERETO.


 


SECTION 17.
JOINT AND SEVERAL OBLIGATIONS OF CO-LESSEES.


 


The term “Lessee” as used in the Lease shall mean and
include any and all Lessees who sign this Lease in the space provided below or
who otherwise hereafter become party to this Lease, each of whom shall be
jointly and severally liable with all other Lessees under the Lease. References
to “Lessee” contained in the Lease shall be deemed to be (unless the context
otherwise specifically requires) references to all Lessees and each of them,
and each and every undertaking under the Lease shall be their joint and several
undertaking. Each Lessee hereby appoints the other as its agent and
attorney-in-fact for the purpose of giving and receiving notices hereunder,
receiving service of process hereunder, and executing and delivering any and
all documents, instruments, certificates, riders, schedules and any other agreements
in connection with the Lease (collectively referred to herein as the “Lease Documents”) on its behalf, and each
Lessee shall be deemed to be a signatory party to each Lease Schedule and
any and all Lease Documents executed and delivered in connection therewith
effective as of the respective dates thereof. In furtherance of the foregoing,
each Lessee hereby acknowledges and agrees as follows:


 


I.                            Absolute Unconditional, Joint and Several
Nature of Obligations. The
obligations of Lessees under or in respect of the Lease Documents (the “Obligations”) are absolute and
unconditional, and shall be joint and several with each other party that may be
liable, directly or indirectly, for the payment or performance of any
Obligations. Lessees shall not be released from any Obligations, nor shall such
Obligations be reduced, diminished or discharged for any reason other than
payment and performance in full thereof, including:


 


(a)                              Modifications and
Indulgences. Any
modifications, renewals, or alterations of any agreement, document or
instrument relating to any Obligation, or any indulgences, adjustments,
preferences, extensions or compromises made by Lessor in favor of any Lessee or
any other party.


 


(b)                             Condition of Lessees or
Other Parties. Any
insolvency, bankruptcy, arrangement, adjustment, composition, liquidation,
disability, dissolution or similar proceeding affecting any Lessee or any other
party; any sale, lease or other disposition of any of the assets of any Lessee


 


14

















 


or any other party; any reorganization of, or change in the composition
of the shareholders, partners or members of any Lessee or any other party; or
any termination of, or other change in, the relationship between any Lessees.


 


(c)                              Invalidity of Obligations or
Other Agreements. The
invalidity, illegality or unenforceability of any Obligation for any reason
whatsoever.


 


(d)                             Release of Any Lessee. Any complete or partial release of any
Lessee or any other party liable for any Obligation for any reason.


 


(e)                              Release and Care of
Collateral; Status of Liens.
Any release, surrender, exchange, deterioration, waste, loss or impairment of
any real or personal property transferred or assigned by any party as
collateral securing payment of any Obligation (the “Collateral”), whether negligent or willful; the failure of
Lessor or any other party to exercise reasonable care in the preservation,
protection, sale or other treatment of any of the Collateral; the failure of
Lessor to create or properly perfect any mortgage, pledge, transfer or
assignment of any Collateral intended to be given by or for the benefit of any
Lessee in connection with any Obligation (a “Lien”);
the unenforceability of any Lien; the subordination of any Lien to any other
lien or encumbrance; or the taking or accepting by Lessor of any other security
for, or assurance of payment of any Obligation.


 


(f)                                Other Action or Inaction. Any other action or inaction on the part of
Lessor, whether or not such action or inaction prejudices Lessees or increases
the likelihood that Lessees will be required to pay or perform any
Obligation pursuant to the terms of the Lease Documents.


 


It is the obligation of
Lessees to discharge all Obligations when due, notwithstanding any occurrence,
circumstance, event, action or omission whatsoever whether or not particularly
described herein. Lessees are not entering into the Lease Documents in reliance
on the value or the availability of any of the Collateral. Lessees acknowledge
that Lessees may be required to pay the Obligations, in full, without the
assistance or support of any other party. Lessees have not been induced to
enter into the Lease Documents on the basis that any party other than the
Lessees will be liable to perform any Obligation or that Lessor will look
to any other party to perform any Obligation. Lessor may release or
settle with, any Lessee or any other party liable, directly or indirectly, for
the performance of any Obligation, all without affecting the liability of any
other Lessee liable under the Lease Documents.


 


II.                        Waivers. Each Lessee hereby waives:


 


(a)                              Action Against Others. Any right to require Lessor to: institute
suit or exhaust remedies against any Lessee or any other party liable for any
Obligation; enforce Lessor’s rights in any of the Collateral or other security
which is at any time given to secure any Obligation; enforce Lessor’s rights
against any other Lessees or any other party liable on any Obligation; join any
Lessee or any other party liable for any Obligation in any action seeking to
enforce the Lease Documents; or exhaust any other remedies available to Lessor
or resort to any other means of obtaining payment or performance of any
Obligation.


 


(b)                             Notices. Notice of the execution, delivery or
acceptance by Lessor, any Lessee or any other party, of the Lease Documents or
any document, agreement or instrument evidencing any Obligation; notice of the
amount of credit extended by Lessor to any Lessee at any time, whether primary
or secondary; notice of modifications or extensions of any Obligation; notice
of defaults or other non-performance by any Lessee in connection with any
Obligation; notice of the transfer or disposition by Lessor of any Obligation;
notice of the repossession, sale or other disposition of any of the Collateral;
notice of the acceptance of the Lease Documents by Lessor; demand and
presentation for payment upon any Lessee or any other party liable for any
Obligation; protest, notice of protest and diligence in bringing suit against
any Lessee or any other party; and any other action or inaction on the part of
Lessor in connection with the Lease Documents or any Obligation.


 


15

















 


(c)                              Subrogation. Any right which any Lessee may at any
time have against any other Lessee, or any other party liable for any
Obligation, as the result of the performance by any Lessee of its obligations
under the Lease Documents, including, but not limited to, contractual,
statutory and common law rights of subrogation, reimbursement, indemnification,
set-off or contribution, until all Obligations owing to Lessor have been paid
and performed in full.


 


(d)                             Suretyship Defenses. Any defenses which Lessees may have or
assert against the enforcement of the Lease Documents or any Obligation based upon
suretyship principles or any impairment of Collateral.


 


III.                    Representations and
Warranties. Each Lessee
hereby reaffirms all of the representations warranties and covenants contained
in the Lease Documents, and hereby confirms that no Event of Default, and no
event or condition which with notice or the passage of time or both would
constitute an Event of Default has occurred and is continuing as of the date
hereof. Each Lessee further represents and warrants to Lessor that:


 


(a)                              Benefit; Value. Each Lessee has received, or will receive,
substantial benefit from the agreements and transactions giving rise to the
Obligations, and has received, or will receive, reasonably equivalent value for
the undertakings of the Lessees under the Lease Documents.


 


(b)                             No Representation by Lessor. Neither Lessor nor any other party has made
any representation, warranty or statement to such Lessee in order to induce it
to join and enter into the Lease Documents.


 


(c)                              Access to information. Each Lessee has adequate means to obtain
continuing and sufficient information concerning the financial and business
condition of the other Lessees and other parties liable in respect of the
Obligations.


 


(d)                             Financial Condition;
Solvency. As of the date
hereof, and after giving effect to the Lease Documents and the contingent
obligations contained herein, each Lessee is solvent and has assets which, when
fairly valued, exceed its liabilities.


 


(e)                              Equipment Use. Each and every Lessee shall have access to
any and all item(s) of Equipment described in any Schedule and all of the
entitlements of a Lessee with respect thereto, regardless of whether such Schedule has
been executed by any particular Lessee. Such access shall be subject to all of
the terms, conditions and limitations as set forth in the Lease or the relevant
Schedule.


 


SECTION 18.
TRUTH IN LEASING.
THE AIRCRAFT, AS EQUIPMENT, BECAME SUBJECT TO THE MAINTENANCE REQUIREMENTS OF
PARTS 91 AND/OR 135, AS APPLICABLE, OF THE FEDERAL AVIATION REGULATIONS (“FARS”)
UPON THE REGISTRATION OF THE AIRCRAFT WITH THE FAA. LESSEE CERTIFIES THAT
DURING THE TWELVE (12) MONTHS (OR PORTION THEREOF DURING WHICH THE AIRCRAFT HAS
BEEN SUBJECT TO U.S. REGISTRATION) PRECEDING THE EXECUTION OF THIS LEASE, THE
AIRCRAFT HAS BEEN MAINTAINED AND INSPECTED UNDER PARTS 91 AND/OR 135, AS
APPLICABLE, OF THE FARS. LESSEE CERTIFIES THAT THE AIRCRAFT WILL BE MAINTAINED
AND INSPECTED UNDER PARTS 91 AND/OR 135, AS APPLICABLE, OF THE FARS FOR
OPERATIONS TO BE CONDUCTED UNDER THIS LEASE. UPON EXECUTION OF THIS LEASE, AND
DURING THE TERM HEREOF, LESSEE, WHOSE NAME AND ADDRESS ARE SET FORTH
IMMEDIATELY BELOW, ACTING BY AND THROUGH THE SIGNATORY HERETO, WHO EXECUTES
THIS SECTION SOLELY IN HER/HIS CAPACITY OF LESSEE SET FORTH BELOW HER/HIS
SIGNATURE, CERTIFIES THAT LESSEE SHALL BE RESPONSIBLE FOR THE OPERATIONAL
CONTROL OF THE AIRCRAFT UNDER THIS LEASE (WHILE IT HAS POSSESSION OF THE
AIRCRAFT), UNLESS OPERATIONAL CONTROL OF THE AIRCRAFT IS PROVIDED TO AN
AIR TAXI OPERATOR CERTIFICATED UNDER PART 135 OF THE FARS, IF AND


 


16

















 


TO THE EXTENT PERMITTED
HEREUNDER. LESSEE FURTHER CERTIFIES THAT IT UNDERSTANDS ITS RESPONSIBILITIES
FOR COMPLIANCE WITH APPLICABLE FARS, PROVIDED HOWEVER, THAT LESSEE SHALL NOT BE
DEEMED TO BE RESPONSIBLE FOR THE OPERATIONAL CONTROL OF THE AIRCRAFT FOR SO
LONG AS THE AIRCRAFT IS IN POSSESSION OF ANY SUCH AIR TAXI OPERATOR HAVING
OPERATIONAL CONTROL TO THE EXTENT PERMITTED HEREUNDER. AN EXPLANATION OF
FACTORS BEARING ON OPERATIONAL CONTROL AND PERTINENT FARS CAN BE OBTAINED FROM
THE NEAREST FEDERAL AVIATION FLIGHT STANDARD DISTRICT OFFICE, GENERAL AVIATION
DISTRICT OFFICE, OR AIR CARRIER DISTRICT OFFICE.


 


[SIGNATURES ON NEXT PAGE]


 


17

















 


IN
WITNESS WHEREOF, the parties hereto have caused this Lease to be duly executed
as of the date first written above by their respective officers thereunto duly
authorized.


 


	
  Lessor:

  	
  Lessee:

  	
   

  	
   

  
	
  BANC OF AMERICA LEASING &
  CAPITAL, LLC

  	
  Ahern Rentals, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
   

  	
   

  	
  By: 

  	
  /s/ Don F. Ahern

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title: 

  	
   

  	
   

  	
  Title: 

  	
  PRESIDENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Print Name: 

  	
   

  	
   

  	
  Print Name: 

  	
  DON F. AHERN

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
  One Financial Plaza, 5th
  Floor 

  	
  Address: 

  	
  4241 S. Arville

  	
   

  	
   

  
	
   

  	
  Providence, RI 02903

  	
   

  	
  Las Vegas, NV 89103

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lessee:

  	
   

  	
   

  
	
   

  	
  Don F. Ahern

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Don F. Ahern

  	
   

  	
   

  
	
   

  	
  Print Name:

  	
  Don F. Ahern

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address: 

  	
  4241 S. Arville

  	
   

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89103

  	
   

  	
   

  
															



 


 


This is Counterpart No. 2
of a total of 3 counterparts. Only Counterpart No. 1 shall be
considered chattel paper for purposes of the Uniform Commercial Code and a
security interest may be perfected only by possession of Counterpart No. 1.


 

















 


EXHIBIT A


 


DEFINITIONS


 


(a) All references in
the Lease to designated Sections and other subdivisions are to such designated
Sections and other subdivisions only, and the words “herein,” “hereof”
and “hereunder” and other words of similar import refer to the Lease as
whole and not to any particular Section or other subdivision.


 


(b) Except as otherwise
indicated, all the agreements and instruments defined herein or in the Lease
shall mean such agreements and instruments as the same may from time to
time be supplemented or amended, or as the terms thereof may be expressly
waived or modified to the extent permitted by, and in accordance with, the
terms thereof.


 


(c) The word “including”
means including without limitation.


 


(d) The terms defined
herein and in the Lease shall, for purposes of the Lease and the Lease
Supplement, addenda, riders, annexes, schedules, and exhibits thereto, have the
meanings assigned to them and shall include the plural as well as the singular
as the context requires.


 


(e) The following terms
shall have the following meanings for all purposes of the Lease:


 


Basic Rent Date, Basic Rent
Percentage, Basic Term, Renewal Term, Daily Rent Percentage, Expiration Date,
First Basic Rent Date, Last Acceptance Date, Last Basic Rent Date, Lessor’s
Cost, Primary Hangar Location, and Rent Commencement Date shall have the meanings set forth in
Schedules No. 2 and 2-A.


 


Abatements shall have the meaning set forth in Section 7
of the Lease.


 


Acceptance Date shall mean the date on which Lessee
irrevocably and unconditionally accepts the Aircraft for lease under the Lease
as evidenced by the execution and delivery of the Lease Supplement dated such
date (and is set forth in the Lease Supplement).


 


Additions shall have the meaning set forth in Section 9
of the Lease.


 


Administrative Charge shall mean an amount equal to five percent
(5%) of the amount payable to which such charge applies.


 


Administrator shall have the meaning ascribed thereto in
the International Registry Regulations and shall, with respect to Lessee, be
the Person designated as such on Schedule No. 2.


 


Affiliate shall mean any affiliated person, firm or
entity controlling, controlled by or under common control with Lessee or
Lessor, as applicable.


 


Alterations shall have the meaning set forth in Section 9
of the Lease.


 


Aircraft shall mean (i) the Airframe, (ii) the
Engines, (iii) any APU, and (iv) the Records.


 


Aircraft Protocol shall mean the official English language
text of the Protocol to the Convention on International Interests in Mobile
Equipment on Matters Specific to Aircraft Equipment, adopted on 16 November 2001
at a diplomatic conference held in Cape Town, as the same may be amended
or modified from time to time.


 


Airframe shall mean (i) the Aircraft described in
Schedule No. 1, and shall not include the Engines or any APU, and (ii) any
and all Parts from time to time incorporated in, installed on, or attached to
such Aircraft and any and all Parts removed therefrom so long as title thereto
shall remain vested in Lessor in accordance with the applicable terms of the
Lease after removal from the Aircraft.


 


19

















 


Applicable Law shall mean all applicable laws including all
statutes, treaties, conventions, judgments, decrees, injunctions, writs and
orders of any court, governmental agency or authority and rules, regulations,
orders, directives, licenses and permits of any governmental body,
instrumentality, agency or authority as amended and revised, and any judicial
or administrative interpretation, of any of the same, including the
airworthiness certificate issued with respect to the Aircraft, the Cape Town
Convention, all FARs, Special FARs, airworthiness directives, and/or any of the
same relating to noise, the environment, national security, public safety,
exports or imports or contraband.


 


APU shall mean any auxiliary power unit
described and listed by manufacturer’s serial number in Schedule No. 1
and currently installed on the Airframe whether or not thereafter installed on
such Airframe or any other airframe from time to time; (ii) any auxiliary
power unit that may from time to time be substituted, pursuant to the applicable
terms of the Lease, for any auxiliary power unit leased hereunder, and (iii) in
each case set forth in clauses (i) and (ii) hereof, with any and all
Parts incorporated in or installed on or attached to any such auxiliary power
unit and any and all Parts removed therefrom so long as title thereto shall
remain vested in Lessor in accordance with the applicable terms of the Lease
after removal from any such auxiliary power unit. The term “APU” means,
as of any date of determination, any auxiliary power unit leased hereunder.


 


AS-IS, WHERE-IS shall mean “AS-IS
WHERE-IS”, AND “WITH ALL FAULTS”, WITHOUT ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, OF ANY KIND WHATSOEVER, BY, OR ANY RECOURSE OF ANY KIND
WHATSOEVER TO, LESSOR.


 


Assignee shall have the meaning set forth in Section 12
of the Lease.


 


Assignment shall have the meaning set forth in Section 12
of the Lease.


 


Associated Rights shall have the meaning ascribed thereto in
the Cape Town Convention, including all rights to payments or other performance
by Lessee under any Lease Document which are secured by or associated with the
Collateral.


 


Aviation Documents shall mean, collectively, the FAA Documents
and the International Registry Documents.


 


Basic Rent shall have the meaning set forth in Section 3
of the Lease.


 


Business Day shall mean any day other than a Saturday,
Sunday or other day on which banks located in Providence, Rhode Island are
closed or are authorized to close.


 


Cape Town Convention shall mean, collectively, the Aircraft
Protocol, the Convention, the International Registry Procedures and the
International Registry Regulations.


 


Casualty Payment Date shall have the meaning set forth in Section 10(a) of
the Lease.


 


Casualty Value for any Basic Rent Date shall be the amount
equal to the Lessor’s Cost multiplied by the applicable percentage set forth on
Schedule No. 3 for such Basic Rent Date (or the corresponding Basic
Rent number), or if the Casualty Payment Date is after the last Basic Rent
Date, the Casualty Value for such date shall be the amount equal to the Lessor’s
Cost multiplied by the applicable percentage set forth on Schedule No.3
for the last Basic Rent Date (or the corresponding Basic Rent number);
provided, however, in the case of an Event of Loss covered by the insurance covering
loss or damage to the Aircraft required to be maintained by Lessee pursuant to
the Lease (or which would have been covered by such insurance, had such
insurance been maintained as required), Casualty Value shall mean the higher of
Fair Market Sales Value or the amount equal to the Lessor’s Cost multiplied by
the applicable percentage set forth on Schedule No. 3 for the
applicable Basic Rent Date (or the corresponding Basic Rent number).


 


Change of Control means the occurrence of any of the following:
(a) Ahern shall die or shall become incapacitated or disabled such that
Ahern is unable to properly perform the duties for Corporate Lessee that


 


20

















 


he performs for Corporate
Lessee on the date hereof; provided, that if Ahern shall die or become
so incapacitated or disabled, a “Change of Control” under this section shall
not occur as a result of such death, incapacitation or disability if within
ninety (90) days after the occurrence of this death or such incapacity or
disability and at all times thereafter, Corporate Lessee shall have employed
one or more Persons with requisite experience that are reasonably satisfactory
to Lessor to perform those duties for Corporate Lessee that Ahern performs
for Corporate Lessee as of the date hereof and Ahern’s obligations under this
Lease are assumed by a Person acceptable to Lessor in its sole discretion; or (b) there
shall occur a “Change of Control” or a “Change of Control” as defined in any
other document or agreement governing material indebtedness of Lessee.


 


Claims shall have the meaning set forth in Section 11
of the Lease.


 


Code shall have the meaning set forth in the
Special Tax Indemnity Rider.


 


Collateral shall have the meaning set forth in Section 16(b) of
the Lease.


 


Consent to Management
Agreement shall mean
the Consent to Management Agreement (Charter) Agreement and Assignment
specified in the Closing Terms Addendum.


 


Convention shall mean the official English language
text of the Convention on International Interest in Mobile Equipment, adopted
on 16 November 2001 at a diplomatic conference held in Cape Town, South
Africa, as the same may be amended or modified from time to time.


 


Daily Rent shall have the meaning set forth in Section 3
of the Lease.


 


Default shall mean an event or circumstance that,
after the giving of notice or lapse of time, or both, would become an Event of
Default.


 


Early Purchase Date shall mean each of the Basic Rent Number(s)
designated as such on Schedule No. 2-A to the Lease Supplement.


 


Early Purchase Option Amount shall be the amount payable by the Lessee in
the event that it exercises its option to purchase the Aircraft pursuant to
paragraph (e) of the Option Addendum, and shall be determined by
multiplying the Lessor’s Cost of the Aircraft by the percentage set forth
opposite the applicable Early Purchase Date set forth on Schedule No. 2-A
to the Lease Supplement.


 


Engine shall mean (i) each of the engines
described and listed by manufacturer’s serial numbers in Schedule No. 1
and currently installed on the Airframe whether or not thereafter installed on
such Airframe or any other airframe from time to time; (ii) any engine
that may from time to time be substituted, pursuant to the applicable
terms of the Lease, for an Engine leased hereunder; and (iii) in each case
set forth in clauses (i) and (ii) hereof, with any and all Parts
incorporated in or installed on or attached to such engine and any and all
Parts removed therefrom so long as title thereto shall remain vested in Lessor
in accordance with the applicable terms of the Lease after removal from such
Engine. The term “Engines” means, as of any date of determination, all
Engines leased hereunder.


 


Estimated Annual Hours shall mean the anticipated number of average
annual flight hours as shown on Schedule No. 2-A.


 


Event of Default shall have the meaning set forth in Section 13
of the Lease.


 


Event of Loss with respect to the Aircraft, the Airframe
or any Engine or any APU, shall mean any of the following events with respect
to such property (i) loss of such property or the use thereof due to
theft, disappearance, destruction, damage beyond repair or rendition of such
property permanently unit for normal use of any reason whatsever; (ii) any
damage to such property which results in an insurance settlement with respect
such property on the basis of a total loss or constructive total loss; (iii) the
condemnation, confiscation or seizure of, or requisition of title to or use of,
such property by the act of any


 


21

















 


government (foreign or
domestic) or of any state or local authority or any instrumentality or agency
of the foregoing (“Requisition of Use”); (iv) as a result of any
rule, regulation, order or other action by any government (foreign or  domestic ) or governmental body (including,
without limitation, the  FAA or any
similar foreign governmental body, having jurisdiction, the use of such
property shall have been prohibited, or such property shall have been declared
unfit for use, for a period of six (6) consecutive months, unless Lessee,
prior to the expiration of the six-month period, shall have undertaken and, in
the opinion of Lessor, shall be diligently carrying forward all steps that are
necessary or desirable to permit the normal use of such property by Lessee or,
in any event, if use shall have been prohibited, or such property shall have
been declared unfit for use, for a period of twelve (12) consecutive months
(unless waived by Lessor in its sole and absolute discretion) or such
prohibition shall exist on the expiration or earlier cancellation or
termination of the Lease; (v) with respect to an Engine or any APU, the
removal thereof from the Airframe for a period of six (6) consecutive
months or longer, whether or not such Engine or any APU, as the case may be,
is operational, or (unless waived by Lessor in its sole and absolute
discretion) such prohibition shall exist on the expiration or earlier
cancellation or termination of the Lease; (vi) the Aircraft, an Engine or
any APU is returned to the Manufacturer, other than for modification in
the  event of patent infringement or for
repair or replacement (any such return being herein referred to as a “Return
to Manufacturer”); or (vii) (unless waived by Lessor in its sole and absolute
discretion) the Aircraft is not returned to Lessor upon the expiration or
earlier termination or cancellation of the Lease, unless Lessee or a third
party purchaser purchases the Aircraft pursuant to Lessee’s exercise of an
option contemplating such purchase under any applicable provision of the Lease.
The date of such Event of Loss shall be the date of such theft, disappearance,
destruction, damage, Requisition of Use, prohibition, unfitness for use for the
stated period, removal for the stated period or Return to Manufacturer. An
Event of Loss with respect to the Aircraft shall be deemed to have occurred if
an Event of Loss occurs with respect to the Airframe. An Event of Loss with
respect to Engine or any APU shall not, without loss of the Airframe, be deemed
an Event of Loss with respect to the Aircraft.


 


Excess Hours shall have the meaning set forth in the
definition of Fair Market Sales Value.


 


FAA shall mean the U.S. Federal Aviation
Administration and/or the Administrator of the Federal Aviation Administration
and the Department of Transportation, or any person, governmental department,
bureau, authority, commission or agency succeeding to the function, of any of
the foregoing, including, where applicable, the Transportation Security Administration.


 


FAA Counsel shall mean Daugherty, Fowler, Peregrin,
Haught & Jenson, 204 North Robinson, Suite 900, Oklahoma City,
Oklahoma 73102, or such other counsel as Lessor may designate.


 


FAA Documents shall have the meaning set forth in the
Closing Terms Addendum.


 


Fair Market Sales Value and Fair Market Rental Value shall
mean those certain values determined on the following basis: (i) the
subject value shall be the amount which would be obtained in  an arm’s length transaction between an
informed and willing buyer or lessee (who is neither a lessee in possession nor
a used equipment dealer), and an informed and willing seller or lessor, as the
case may be, under no compulsion to sell or lease, as the case may be;
(ii) the costs of removal of the Aircraft from its then location shall not
be a deduction from such value; and (iii) in determining any such value,
it shall be assumed (whether or not the same be true) (A) that the
Aircraft has been maintained by Lessee and is in the condition in which it is
required to be returned to Lessor, in each case, in accordance with the Lease, (B) such
value has not been diminished due to the existence of any damage history, and (C) that
the total number of Airframe hours (including any component with hourly
overhaul schedules) accumulated from the Acceptance Date to the Expiration Date
or other date of termination or cancellation do not exceed the product of
Estimated Annual Hours times the number of twelve month periods and any portion
thereof from the  Acceptance  Date to such expiration, termination, or
cancellation date (any such excess, the “Excess hours”).


 


FARs shall mean the Federal Aviation Regulations
and any Special Federal Aviation Regulations (Title 14 C.P.R. Part 1 et
seq.), together with all successor regulations thereto.


 


22

















 


Final Consent shall have the meaning ascribed thereto in
the International Registry Procedures.


 


GAAP shall mean generally accepted accounting
principles consistently applied.


 


Impositions shall have the meaning set forth in Section 8
of the Lease.


 


International Interest shall have the meaning ascribed thereto in
the Cape Town Convention.


 


International Registry shall mean the International Registry of
Mobile Assets located in Dublin, Ireland and established pursuant to the Cape
Town Convention, along with any successor registry thereto.


 


International Registry
Documents shall have
the meaning set forth in the Closing Terms Addendum.


 


International Registry
Procedures shall mean
the official English language text of the procedures for the International
Registry issued by the supervisory authority thereof pursuant to the Convention
and the Aircraft Protocol, as the same may be amended or modified from
time to time.


 


International Registry Regulations shall mean the official English language
text of the regulations for the International Registry issued by the
supervisory authority thereof pursuant to the Convention and the Aircraft
Protocol, as the same may be amended or modified from time to time.


 


Late Payments Rate shall mean the lesser of a rate equal to
1.5% per month or the highest rate permitted by Applicable Law. The Late
Payment Rate shall be computed on the basis of a 360 day year and a 30 day
month.


 


Lease Documents shall mean the Lease (including the Lease
Supplement), and all documents, instruments and agreements entered into or
provided by Lessee, any guarantors and or other third party pursuant to or in
connection with the Lease.


 


Lease Supplement shall mean a supplement to the Lease to be
entered into as of the Acceptance Date by Lessee, which supplement shall be
substantially in the form as attached to the Lease, and upon execution by
Lessee shall constitute a part of the Lease.


 


Lessor’s Liens shall mean any Liens created or granted by
Lessor resulting from claims against Lessor not related to Lessor’s ownership
of the Aircraft or otherwise contemplated under the Lease.


 


Liens shall mean all liens, charges, security
interests, leaseholds and encumbrances of every nature and description
whatever, including, without limitation, any of the same arising in connection
with or created by and impositions, any International Interests (other than
Lessor’s Liens) and rights of third parties under management, charter, pooling,
interchange, sublease, timeshare, overhaul, repair or other similar agreements
or arrangements.


 


Liquidated Damages shall means the liquidated damages (all of
which, Lessee hereby acknowledges and agrees, are damages to be paid in lieu of
future Basic Rent and are reasonable in light of the anticipated harm arising
by reason of an Event of Default, and are not a penalty) described in parts
(i), (ii), or (iii) below, as determined by whether the Aircraft is
returned or otherwise recovered, and if returned or recovered, the time and
manner of the disposition of the Aircraft:


 


(i) If
Lessor recovers and sells the Aircraft, or Lessees has not returned the
Aircraft in the manner and condition required by the Lease, an amount
calculated as the Casualty Value of the Aircraft (determined as of the next
Basic Rent Date after the date of the occurrence of the subject Event of
Default), together with all other Rent due hereunder as of such determination
date, less a credit for any disposition proceeds, if applicable pursuant to the
application provisions in the next sentence. If Lessor demands the liquidated
damages under the part (i), and recovers and sells the Aircraft, any
proceeds of such disposition by Lessor, to the extent received by Lessor in
good and indefeasible funds, shall be applied by Lessor (A) first,
to pay all costs, charges and expenses, payable pursuant to Sections 13, (B)


 


23

















 


second, to pay to Lessor an amount equal to any
unpaid Rent due and payable, together with the liquidated damage amounts
specified in this part (i), to the extent not previously paid, (C) third,
to pay to Lessor any interest accruing on the amounts covered by the preceding
clauses, at the Late payment Rate, from and after the date the same become due
and payable pursuant to the terms hereof through the date of payment, and (D) fourth,
to reimburse Lessee for such amounts to the extent paid by Lessee as liquidated
damages pursuant to this part (i) (up to the amount of the Casualty
Value calculated as provided in the first sentence of this part (i)). Any
amount remaining thereafter shall be retained by Lessor as owner of the
Aircraft.


 


(ii) If
Lessor recovers the Aircraft and disposes of it pursuant to a lease which is
substantially similar to the Lease, then an amount equal to the sum of (A) any
accrued and unpaid Rent under the Lease as of the date of commencement (the “Commencement
Date”) of the term of the new lease, plus (B) the present value
as of the Commencement Date of the total Basic Rent for the then remaining term
of the Lease, minus (C) the present value as of the Commencement
Date of the rent payable under the new lease, but only for the period of the
new lease term which commences on the commencement date of new lease and
expires on the Expiration Date of the Lease.


 


(iii) If
Lessor recovers the Aircraft and disposes of it by a lease that is not
substantially similar to the Lease, or elects not to dispose of the Aircraft,
an amount equal to the sum of (A) any accrued and unpaid Rent as of the
date Lessor repossesses the Aircraft or such earlier date as Lessee tenders
possession of the Aircraft to Lessor, plus (B) the present value as
of the date of delivery under clause (A) of the total Basic Rent for the
then remaining Term of the Lease, minus (C) the present value, as
of that certain date which may be determined by taking into account Lessor’s
having a reasonable opportunity to repossess and remarket the Aircraft, of the “market
rent” (as computed pursuant to Article 2-A of the UCC) in the continental
U.S. on that date, computed for the same lease term; provided, however,
Lessee acknowledges and agrees that if Lessor is unable after reasonable effort
to dispose of the Aircraft at a reasonable price or the circumstances
reasonably indicate that such an effort will be unavailing, the “market rent”
in such event will be deemed to be $0.00, but in the event that Lessor does
eventually re-lease or otherwise dispose of the Aircraft, it will apply the net
proceeds of such disposition, to the extent received in good and indefeasible
funds, as a credit or reimbursement, as applicable, in a manner consistent with
the applicable provisions of Article 2-A.


 


For purposes of computing
liquidated damages under parts (ii) or (iii) above only, amounts
discounted to present value, shall be discounted at the rate of the Index Rate
plus one percent (1%) per annum, compounded annually. For purposes of computing
liquidated damages under parts (ii) or (iii) above only, “Index
Rate” shall mean the “one-month” “London Interbank Offered Rate (LIBOR)” as
published in The Wall Street Journal in effect, as the case may be,
two days prior to the Acceptance Date. Lessor shall have no obligation to make
any of the remittances to Lessee that are contemplated in any part of this
definition if Lessor has paid such amounts to any guarantor or other Person
having a right of subrogation with respect to such amounts, or such guarantor
or other Person has demanded the payment of such amount.


 


Loaner Engine shall have the meaning set forth in Section 9(d).


 


Maintenance Requirements shall mean, with respect to the Airframe,
any Engine, any APU or any Part, all compliance requirements set forth in or
under (i) all maintenance manuals initially furnished with respect
thereto, including any subsequent amendments or supplements to such manuals
issued by the manufacturer or Supplier from time to time, (ii) all
mandatory service bulletins issued, supplied, or available by or through the
Manufacturer and/or the Manufacturer of any Engine, any APU or Part with
respect thereto, (iii) all applicable airworthiness directives issue by
the FAA or similar regulatory agency having jurisdictional authority, (iv) all
conditions to the enforcement of any warranties pertaining thereto, (v) Lessee’s
FAA approved maintenance program with respect thereto, (vi) any
computerized maintenance monitoring program or engine maintenance program, and (vii) all
additional requirements set forth in a Supplemental Maintenance Addendum, if
any.


 


24

















 


Management Agreement shall mean the all of the documents and
agreements constituting the management agreement referenced in the Consent to
Management Agreement.


 


Manager shall mean the manager referenced in the
Consent to Management Agreement.


 


Manufacturer shall mean each manufacturer identified on Schedule No. 1
and its successors and assigns.


 


Material Damage shall mean any damage: (a) required to
be reported pursuant to any governmental reporting requirement, (b) with
respect to which an insurance claim is being made, or (c) requiring that
the Aircraft or any Engine be taken out of service for more than one (1) day
to repair.


 


Parts shall mean all appliances, avionics, parts,
instruments, appurtenances, accessories, furnishings and other equipment or
property of whatever nature (other than Additions or Engines), which may from
time to time be incorporated or installed in or attached to the Airframe or any
Engine or any APU for so long as title thereto shall be vested in Lessor in
accordance with the applicable terms of the Lease.


 


Permitted Liens shall mean (a) the respective rights of
others under subleases, management agreements, or charters, if any, to the
extent expressly provided and permitted by the terms of Section 12 of the
Lease, (b) Lessor’s Liens, and (c) Liens for taxes either not yet due
or being contested by Lessee in good faith, and inchoate materialmen’s,
mechanic’s, workmen’s, repairmen’s, employee’s, or other like Liens arising in
the ordinary course of business of Lessee for sums not yet delinquent or being
contested in good faith, (and for the payment of which adequate assurances
and/or security have, in Lessor’s sole judgment, been provided to Lessor) with
due diligence and by appropriate proceedings, if Lessor shall have determined
in its sole judgment that the nonpayment of any such tax or Lien or the contest
of any such payment in such proceedings does not and will not adversely affect
the title, property or rights of Lessor.


 


Person shall mean any individual, partnership,
corporation, limited liability company, trust, association, joint venture,
joint stock company, or non-incorporated organization or government or any
department or agency thereof, or any other entity of any kind whatsoever.


 


Priority Search Certificate shall have the meaning ascribed thereto in
the International Registry Procedures.


 


Professional User Entity shall have the meaning ascribed thereto in
the International Registry Regulations and shall, with respect to Lessee, be
the Person designated as such on Schedule No. 2.


 


Purchase Documents shall mean all fully executed purchase
agreements in connection with the acquisition of the Aircraft, including the
Engines, assignments of any or all of the Purchase Documents, in form and
substance satisfactory to Lessor, invoices and bills of sale from Supplier,
naming Lessor as purchaser and any other documents required in Section A.1(a) of
the Closing Terms Addendum.


 


Records shall mean the original versions of any and
all logs, manuals, certificates and data and inspection, modification,
maintenance, engineering, technical, and overhaul records (whether in written
or electronic form) with respect to the Aircraft (whether in existence as of,
or created at any time after, the Acceptance Date), including, without
limitation, (i) all records required to be maintained by the FAA or any
other governmental agency or authority having jurisdiction with respect to the
Aircraft or any Manufacturer or Supplier of the Aircraft (or any part thereof)
with respect to the enforcement of warranties or otherwise, and (ii) with
respect to the Airframe, any Engine, APU or Part, all records related to any
manufacturer’s maintenance service program, computerized maintenance monitoring
program or engine maintenance program, which Records shall be at all times the
property of Lessor after the Acceptance Date.


 


Rent shall have the meaning set forth in Section 3
of the Lease.


 


Required Documents shall have the meaning set forth in the
Closing Terms Addendum.


 


Requisition of Use shall have the meaning set forth in the
Event of Loss definition contained herein.


 


25

















 


Return to Manufacturer shall have the meaning set forth in the
Event of Loss definition contained herein.


 


Schedules No. 1, 2, 2-A
or 3 shall mean any
of Schedules No. 1, 2, 2-A or 3, as applicable, to the Lease Supplement.


 


SEC shall mean the Securities and Exchange
Commission.


 


Supplemental Rent shall have the meaning set forth in Section 3
of the Lease.


 


Supplier shall mean the “Supplier” or “Suppliers”, as
the case may be, identified as such on Schedule No. 1 and their
respective successors and assigns.


 


Tax Loss shall have the meaning set forth in the Tax
Rider.


 


Term shall mean the Basic Term together with (i) the
period, if any, from and including the Acceptance Date through, but not
including, the Rent Commencement Date, and (ii) any Renewal Term or
Renewal Terms, if any, entered into pursuant to the Lease.


 


Transacting User Entity shall have the meaning ascribed thereto in the
International Registry Regulations.


 


Transportation Code shall mean Title 49, Subtitle VII of the
United States Code, as then in effect.


 


UCC shall
mean the Uniform Commercial Code as in effect in applicable jurisdiction.


 


26
















 


SPECIAL
TAX INDEMNITY RIDER (“Tax Rider”) to Aircraft Lease
(S/N 525-0497) dated as of October 5, 2007, (the “Lease”) by and between
BANC OF AMERICA LEASING & CAPITAL, LLC, as lessor (“Lessor”), and
Ahern Rentals, Inc. (the “Corporate Lessee”) and Don F. Ahern (“Ahern”), as
co-lessees (collectively, the Corporate Lessee and Ahern are referred to
hereinafter as the “Lessee”) (“Lessee”).


 


All capitalized
terms not defined in this Tax Rider are defined in the Lease. Execution of the
Lease by Lessee and Lessor shall be deemed to constitute execution and
acceptance of the terms and conditions of this Tax Rider, and it shall
supplement and be a part of the Lease.


 


1.         Lessor’s Assumptions.
In entering into the Lease and the transactions contemplated thereby, Lessor
has assumed that: (a) Lessor will be entitled, for federal, state and local
income tax purposes, to the following tax benefits (the “Assumed Tax
Benefits”): cost recovery deductions under section 168 of the Internal
Revenue Code of 1986, as amended (the “Code”) commencing in Lessor’s
taxable year which includes the Acceptance Date, calculated using (i) the 200%
declining balance method, switching to the straight line method for the first
taxable year for which that method yields a larger deduction, (ii) the half
year convention, (iii) a basis equal to 100% of Lessor’s Cost, (iv) zero
salvage value, and (v) a recovery period of five (5) years; and (b) Lessor will
be taxed for federal, state and local corporate income and franchise tax
purposes at an effective combined tax rate of 37.50% (the “Assumed Tax Rate”).


 


2.         Lessee’s Representations,
Warranties and Covenants. (Lessee represents, warrants, and
covenants that: (a) the Aircraft will not constitute “property used
predominantly outside the United States”, “public utility property”, or “tax-exempt
use property” within the meaning of Section 168(i)(10) of 168(h) of the Code
and (b) neither Lessee nor any member of any group of corporations, limited
liability companies, partnerships, or other organizations with which Lessee
files consolidated, combined or unitary income or franchise tax returns will
file any tax return or other document which is inconsistent with the treatment
of Lessor as the owner of the Aircraft for income tax purposes.


 


3.         Indemnity for Lessee’s
Acts or Omissions.


 


(a)       Indemnity. Upon the occurrence of
any Tax Loss, Lessee shall pay to Lessor at Lessor’s option either: (i) an
amount or amounts that, after reduction by the net amount of all federal, state
and local taxes required to be paid by Lessor with respect to the receipt of
such amount or amounts, equals the aggregate additional federal, state and
local income taxes payable by Lessor as a result of such Tax Loss plus any
interest, fines, additions to tax or penalties relating to or in connection
with such Tax Loss, which amount shall be payable within thirty (30) days after
written notice from Lessor to Lessee that a Tax Loss has occurred, or (ii)
additional Rent on each Basic Rent Date, beginning on the Basic Rent Date
specified in written notice from Lessor to Lessee that a Tax Loss has occurred,
in such amounts as are necessary to maintain Lessor’s after-tax economic yield
and overall net after-tax cash flow for the entire Term at the same level that
would have been available if such Tax Loss had not occurred, plus any interest,
penalties or additions to tax that may be imposed in connection with such Tax
Loss. In the event of any Tax Loss, the Casualty Value and any affected option
amounts shall be adjusted appropriately by Lessor. Any amount payable by Lessee
with respect to a Tax Loss shall be calculated based on the assumptions set
forth in Section 1 above.


 


(b)       Tax Loss. For the purposes of this
indemnity, any of the following events shall constitute a “Tax Loss”:
(i) as the result of any act or failure to act of Lessee (regardless of whether
any such act or failure to act is permitted by the terms of the Lease or
otherwise, but excluding (a) Lessee’s act of entering into the Lease, and (b)
any act expressly permitted under the Lease), or the breach of any of Lessee’s
representations, warranties, or covenants set forth in this Tax Rider, Lessor
shall lose, or shall not have the right to claim, or shall suffer a
disallowance or recapture with respect to, or shall receive a lower than anticipated
economic benefit from, all or any portion of the Assumed Tax Benefits; (ii) for
federal, foreign, state or local income tax purposes, any item of income, loss
or deduction with respect to the Aircraft is treated as derived from, or
allocable to, sources outside the U.S., and as a result Lessor’s allowable
foreign tax credit for federal income tax purposes for any year is less than
the credit to which Lessor would have been entitled if all such income, loss
and deduction had been from U.S. sources; or (iii) during the Term


 


27

















 


there shall be included
in Lessor’s gross income for federal, state or local income tax purposes any
amount on account of any Addition, Alteration or other modification or
improvement to or in respect of the Aircraft made or paid for by Lessee, or due
to an exchange of the Aircraft or any portion of the Aircraft, which results in
any reduction to Lessor’s anticipated after-tax economic yield from the Lease.


 


4.         Beneficiaries of the
Indemnity. For purposes of this Tax Rider, (a) “Lessor”
includes any entity identified as Lessor , its successors in interest, each
assignee and each of their respective successors in interest and assigns, any
Consolidated Group (hereinafter defined) of which Lessor or any such assignee
or any of their respective successors in interest or assigns is, or may become
a member, and each member of such Consolidated Group; and (b) “Consolidated
Group” means an affiliated group (within the meaning of Section 1504 of the
Code) that files consolidated returns for federal income tax purposes and any
group filing combined, unitary or consolidated returns pursuant to the rules of
any state taxing authority.


 


5.         Survival. The
indemnification obligations of Lessee under this Tax Rider shall survive the
expiration, cancellation or termination of the Lease. Provided the Lessee
fully, timely and indefeasibly performs its indemnification obligations under
this Tax Rider in accordance with the terms hereof and of the Lease, Lessor
shall have no additional remedies with respect to the occurrence of a Tax Loss.


 


[SIGNATURES
ON NEXT PAGE]


 


28

















 


IN
WITNESS WHEREOF, the parties hereto have each caused this Tax Rider to be duly
executed by their respective officers, thereunto duly authorized as of the date
first written above.


 


 


	
   

  	
  BANC OF AMERICA LEASING
  & CAPITAL, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Ahern Rentals, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Don F. Ahern

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  DON F. AHERN

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  PRESIDENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Don F. Ahern

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Don F. Ahern

  	
   

  
	
   

  	
  Print Name:

  	
  Don F. Ahern

  	
   

  
												



 

















 


IN WITNESS WHEREOF, the parties hereto have each caused this Tax Rider
to be duly executed by their respective officers, thereunto duly authorized as
of the date first written above.


 


 


	
   

  	
  BANC OF AMERICA LEASING
  & CAPITAL, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tracy A. Doorley

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Tracy A. Doorley

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Ahern Rentals, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Don F. Ahern

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Print Name:

  	
  Don F. Ahern

  	
   

  
										



 

















 


INSURANCE
ADDENDUM (“Insurance Addendum”) to Aircraft Lease (S/N
525-0497) dated as of October 5, 2007, (the “Lease”) by and between BANC
OF AMERICA LEASING & CAPITAL, LLC, as lessor (“Lessor”), and Ahern
Rentals, Inc. (the “Corporate Lessee”) and Don F. Ahern (“Ahern”), as
co-lessees (collectively, the Corporate Lessee and Ahern are referred to
hereinafter as the “Lessee”) (“Lessee”).


 


All capitalized
terms not defined in this Insurance Addendum are defined in the Lease.
Execution of the Lease by Lessee and Lessor shall be deemed to constitute
execution and acceptance of the terms and conditions of this Insurance
Addendum, and it shall supplement and be a part of the Lease.


 


(a) Liability
Insurance. Lessee shall maintain at its sole cost and expense for the
entire Term with insurers of recognized reputation and responsibility
satisfactory to Lessor (but in no event having an A.M. Best or comparable
agency rating of less than “A-”) (i) comprehensive aircraft and general liability
insurance against bodily injury or property damage claims, including, without
limitation, contractual liability, premises damage, public liability, death and
property damage liability, public and passenger legal liability coverage, and
sudden accident pollution coverage, in an amount not less than: (A)
$25,000,000.00 when operated under Part 91 of the FARs, or (B) $50,000,000.00
when operated under Part 135 of the FARs for each single occurrence and (ii)
personal injury liability in an amount not less than $25,000,000.00.


 


(b) “All-Risk”
Hull Insurance. Lessee shall maintain at its sole cost and expense for the
entire Term with insurers of recognized reputation and responsibility
satisfactory to Lessor (but in no event having an A.M. Best or comparable
agency rating of less than “A-”), “all risk” ground, taxiing, and fight hull
insurance on an agreed-value basis, covering the Aircraft, provided that such
insurance shall at all times be in an amount not less than the Casualty Value
of the Aircraft (such amount determined at the Acceptance Date and at each
anniversary of the Rent Commencement Date for each succeeding year throughout
the Term).


 


(c) War Risk
and Allied Perils. Lessee shall also maintain war risk and allied perils
(including confiscation, appropriation, expropriation, terrorism and hijacking
insurance) in the amounts required in Paragraph (a) and Paragraph (b) above, as
applicable.


 


(d) Additional
Policy Requirements. Any policies of insurance carried in accordance with
this insurance Addendum and any policies taken out in substitution or
replacement of any policies (i) shall be endorsed to name Lessor as the owner
of the Aircraft and as additional insured as its interests may appear (but
without responsibility for premiums), (ii) with respect to insurance carried in
accordance with Paragraphs (b) or (c) above, as applicable, shall provide that
any amount payable thereunder shall be paid directly to Lessor as sole loss
payee and not to Lessor and Lessee jointly, (iii) shall provide for thirty (30)
days written notice by such insurer of cancellation, material change, or
non-renewal, (iv) include a severability of interest clause providing that such
policy shall operate in the same manner as if there were a separate policy
covering each insured, (v) waive any right of set-off against Lessee or Lessor,
and any rights of subrogation against Lessor, (vi) shall provide that in
respect of the interests of Lessor in such policies, the insurance shall not be
invalidated by any action or inaction of Lessee or any other Person operating
or in possession of the Aircraft regardless of any breach or violation of any
warranties, declarations or conditions contained in such policies by or binding
upon Lessee or any other Person operating or in possession of the Aircraft and
(vii) shall be primary, not subject to any co-insurance clause and shall be
without right of contribution from any other insurance. Notwithstanding clause
(ii) of the preceding sentence, so long as no Default has occurred and is
continuing, and no Event of Default or Event of Loss with respect to the
Aircraft has occurred, the amounts referred to in clause (ii) may be paid, as
applicable, either (A) if $100,000.00, or more, in the aggregate, to Lessor and
Lessee, jointly, as their interests may appear, and released by Lessor to
Lessee or other appropriate Persons in payment of the costs actually incurred
with respect to repairs made to the Aircraft so as to restore it to the
operating condition required by the Return Addendum and any other applicable
provision of the Lease, or shall be disbursed by Lessor as otherwise required
by the Lease, or (B) if less than $100,000.00 in the aggregate, to Lessee (and
such amounts shall be applied by Lessee to pay the costs of such repairs).


 


(e) World Wide
Coverage. All of the overages required in this Insurance Addendum shall be
in full force and effect worldwide throughout any geographical areas to, in, or
over which the Aircraft is operated.


 


30

















 


(f) No Right To
Self-Insure. Lessee shall not self-insure (by deductible, premium
adjustment, or risk retention arrangement of any kind) the insurance required
to be maintained hereunder.


 


(g) U.S.
Dollars. All insurance proceeds payable under the requisite policies shall
be payable in U.S. Dollars.


 


(h) Adjustments
to Coverage. Lessee agrees that is shall obtain and maintain such other
insurance coverages, or cause adjustments to be made to the scope, amount or
other aspects of the existing insurance coverages, promptly upon Lessor’s
request, as and when Lessor deems such additional insurance coverages or
modifications to be appropriate in light of any changes in Applicable Law,
prudent industry practices, the insurance market, Lessee’s anticipated use of
the Aircraft or other pertinent circumstances.


 


31

















 


CLOSING
TERMS ADDENDUM (“Closing Terms Addendum”) to Aircraft
Lease (S/N 525-0497) dated as of October 5, 2007, (the “Lease”) by and
between BANC OF AMERICA LEASING & CAPITAL, LLC, as lessor (“Lessor”),
and Ahern Rentals, Inc. (the “Corporate Lessee”) and Don F. Ahern (“Ahern”), as
co-lessees (collectively, the Corporate Lessee and Ahern are referred to
hereinafter as the “Lessee”) (“Lessee”).


 


All capitalized
terms not defined in this Closing Terms Addendum are defined in the Lease.
Execution of the Lease by Lessee and Lessor shall be deemed to constitute
execution and acceptance of the terms and conditions of this Closing Terms
Addendum, and it shall supplement and be a part of the Lease.


 


A.       Purchase and Required Documents.
On or prior to the Acceptance Date and at least one full Business Day prior to
closing, Lessee shall have delivered or caused to be delivered the following to
Lessor, as applicable:


 


1.         “Purchase Documents” including
copies of the following:


 


(a) All purchase
and warranty agreements entered into by Lessee or any predecessors in
connection with the acquisition of the Aircraft, including the assignment of
such purchase agreements to Lessor; (b) warranty bills of sale conveying title
to the Aircraft, including the Engines, from Supplier to Lessor; (c) invoices
in Lessor’s name for the purchase of the Aircraft, including the Engines; (d)
evidence of Lessee’s tax exempt status for purposes of sales and use tax in
form and substance satisfactory to Lessor, if applicable; and (e) all exhibits,
addenda, supplements and revisions, and such other documents relating to the
purchase or conveyance of title as Lessor may request.


 


2.         “Required Documents” shall mean
and include the following:


 


(a) All Lease
Documents, including four (4) executed counterparts of the Lease, Lease
Supplement and Schedules thereto, together with the Consent to Management
Agreement.


 


(b) UCC
assignments, release and/or termination statements, where needed, relating to
the Aircraft and the Collateral in all places that are, in Lessor’s opinion,
necessary or appropriate to protect Lessor’s interest therein.


 


(c) Certificate(s)
of good standing for Corporate Lessee from its state of organization and the
state(s) where the Primary Hanger Location, New Hanger Location and Corporate
Lessee’s chief executive offices and principal place of business are located.


 


(e) A certificate
or certificates, executed by Corporate Lessee’s secretary or other authorized
representative certifying: (i) that execution, delivery and performance of the
Lease and all ancillary documentation and the entrance by Corporate Lessee into
the transactions contemplated hereby and thereby have been authorized, and (ii)
the name(s) of the person(s) authorized to execute and deliver such documents
on behalf of Corporate Lessee together with specimen signature(s) of such
person.


 


(f) Copies of
Corporate Lessee’s articles of incorporation and by-laws, or manager’s or
member’s certificate, certificate of formation, and operating agreement, as
applicable.


 


(g) Evidence in
form and substance satisfactory to Lessor as to the insurance coverage required
under the Insurance Addendum, including, but not limited to, a certificate of
insurance, copies of endorsements (including a Lessor endorsement), applicable
policies and written confirmation from the insurance underwriter or broker that
the insurance coverage provided is in compliance with the requirements of the
Insurance Addendum of the Lease and the Consent to Management Agreement.


 


(h) An inspection
report and/or appraisal satisfactory to Lessor with respect to the Aircraft
prepared by inspector(s) or appraiser(s) acceptable to Lessor.


 


32

















 


(i) One (1) fully
executed copy of the Management Agreement, together with a copy of Manager’s
air carrier certificate.


 


(j) Such other
documents, certificates and opinions, and evidence of such other matters, as
Lessor, Lessor’s counsel or FAA Counsel may reasonably request.


 


B.        FAA Documents. On or prior to the
Acceptance Date and at least one full Business Day prior to closing, Lessee
shall have delivered to FAA counsel the following “FAA Documents”, as
applicable.


 


1.         Evidence of reservation of a FAA
registration number for the Aircraft and/or an Assignment of Special
Registration Number (FAA AC Form 8050-64) assigning rights in such “N” number
to Lessor with respect to the Aircraft.


 


2.         Evidence of the issuance by the FAA of
a Standard Airworthiness Certificate (FAA AC Form 8100-2) for the Aircraft.


 


3.         All of the following in proper form for
filing with and recording by the FAA: (a) The executed FAA Aircraft Bill of
Sale (FAA AC Form 8050-2) (the “FAA Bill of Sale”) in the name of
Lessor; (b) the executed FAA Aircraft Registration Application (FAA AC Form
8050-1) (the “Registration Application”) (except for the pink copy which
shall be available to be placed on the Aircraft upon acceptance thereof); (c)
executed releases of any Liens in form and substance satisfactory to FAA
Counsel. Lessor’s counsel and/or Lessor; (d) one (1) fully executed counterpart
of the Lease, and the Lease Supplement and Schedules thereto, all the foregoing
being in proper form for filing with and recording by the FAA; (e) such other
documents as are necessary, in the opinion of FAA Counsel, to vest good title
to the Aircraft in the name of Lessor, free and clear of Liens; (f) a
Declaration of International Operations if Lessee is scheduled to fly the
Aircraft out of the continental U.S. (including over international waters)
within thirty (30) days after Closing; and (g) if applicable, a LLC application
or statement acceptable to the FAA.


 


C.        International Registry Documents.
On or prior to the Acceptance Date and at least one full Business Day prior to
closing, Lessee shall have delivered to FAA counsel the following “International
Registry Documents”, as applicable:


 


1.         Fully executed and authorized discharges
of any International Interests in form and substance satisfactory to FAA
Counsel. Lessor’s counsel and/or Lessor, along with the consent(s) (including
Final Consent(s)) of the applicable parties thereto, necessary for the Aircraft
to be conveyed to Lessor free and clear of Liens.


 


2.         AC Form 8050-135 FAA Entry Point Filing
Forms International Registry in proper form for filing with the FAA with
respect to this Lease, any Associated Rights and the sale of the Aircraft by
Supplier of Lessor.


 


3.         Evidence that each Lessee and Supplier
are each a Transacting User Entity of the International Registry and that each
has designated a Professional User Entity satisfactory to Lessor.


 


4.         A Priority Search Certificate from the
International Registry addressed to Lessor indicating that the Aircraft is free
and clear of Liens, and, on the Acceptance Date, confirmation from FAA Counsel
that a Priority Search Certificate from the International Registry indicates
that the Aircraft is free and clear of Liens.


 


5.         At closing, Lessor and FAA Counsel
shall receive confirmation (which confirmation shall be satisfactory to Lessor
and FAA Counsel) by Supplier’s and each Lessee’s respective Professional User
Entities that each such party has consented to the registration of all
International Interests (including all required Final Consents).


 


33

















 


6.         Such other documents as are necessary,
in the opinion of FAA Counsel, to register Lessor’s International Interest in
and contract of sale of the Aircraft, along with any Associated Rights thereto
pursuant to the Cape Town Convention, free and clear of Liens.


 


D.        Conditions Subsequent


 


1. On or subsequent
to the Acceptance Date, but not later than the date of the Aircraft’s first
flight under the leasehold conveyed herein, Lessee shall confirm to Lessor that
pertinent copies of the Registration Application, Standard Airworthiness
Certificate the Lease, including the Lease Supplement have been properly placed
on the Aircraft. In addition, for all operations outside the continental U.S.,
the Lessee shall maintain either a permanent Certificate of Registration or “fly-time
wire” (FAA Standard Form 14) on-board the Aircraft.


 


2. Lessee shall
confirm to Lessor that (a) within 24 hours following execution thereof, a copy
of the Lease was mailed to the Flight Standards Technical Division of the FAA;
and (b) Lessee has notified the FAA (such notification to have been given by
facsimile transmission, telephone or in person to the FAA Flight Standards
District Office, General Aviation District Office nearest the airport where
such flight will originate) concerning the first flight of the Aircraft under
the Lease at least forty-eight (48) hours prior to takeoff.


 


3. Within five (5)
business days after the closing, Lessor shall receive an opinion of FAA Counsel
satisfactory to Lessor that title to the Airframe is vested in Lessor, that
Lessor has a valid and perfected security interest in the Aircraft, has duly
registered and searchable International Interest in the Aircraft, and that the
Aircraft (including the Airframe and Engines) is free and clear of all other
Liens of record.


 


4. Immediately
after closing, but on the Acceptance Date, Lessor shall receive a Priority
Search Certificate from the International Registry addressed to Lessor
evidencing that its International Interest in the Aircraft, any Associated
Rights and the contract of sale of the Aircraft have been duly registered
therein and are searchable.


 


34

















 


PURCHASE,
EARLY PURCHASE AND RENEWAL OPTION ADDENDUM (“Option
Addendum”) to Aircraft Lease (S/N 525-0497) dated as of October 5, 2007,
(the “Lease”), by and between BANC OF AMERICA LEASING & CAPITAL,
LLC, as lessor (“Lessor”), and Ahern Rentals, Inc. (the “Corporate
Lessee”) and Don F. Ahern (“Ahern”), as co-lessees (collectively, the Corporate
Lessee and Ahern are referred to hereinafter as the “Lessee”) (“Lessee”).


 


All capitalized
terms not defined in this Option Addendum are defined herein in the Lease.
Execution of the Lease by Lessee and Lessor shall be deemed to constitute
execution and acceptance of the terms and conditions of this Option Addendum,
and it shall supplement and be a part of the Lease.


 


Purchase and Renewal
Options.


 


(a) End of Term
Purchase Option. So long as (i) no Event of Default shall have occurred,
and (ii) Lessee shall not have exercised its renewal option pursuant to
Paragraph (b) hereof, Lessee may, upon giving its irrevocable written notice to
Lessor at least one hundred eighty (180) days but no more than two hundred
forty (240) days prior to the Expiration Date, purchase the Aircraft at the
expiration of the Basic Term for an amount, payable in immediately available
funds, equal to the Fair Market Sales Value of the Aircraft as of the end of
the Basic Term determined in accordance with Paragraph (c) hereof plus any
applicable impositions resulting from such sale, together with any Basic Rent
due and payable on or before the Expiration Date and all other accrued and unpaid
Rent. Lessor’s sale of the Aircraft shall be on an “AS-IS
WHERE-IS” basis, except that Lessor shall represent to Lessee that
the Aircraft shall be free and clear of all Lessor’s Liens.


 


(b) Renewal
Option. So long as (i) no Default or Event of Default shall have occurred,
and (ii) Lessee shall not have exercised its purchase options pursuant to
either Paragraph (a) or (e) hereof, Lessee may renew this Lease for the Renewal
Term referred to on Schedule 2-A commencing upon the expiration of the Basic Term.
Lessee’s option to renew this Lease for a Renewal Term shall be exercisable by
giving irrevocable written notice to Lessor at least one hundred eighty (180)
days but no more than two hundred forty (240) days prior to the expiration of
the Basic Term. All of the provisions of this Lease shall be applicable during
the Renewal Term, except that, the Basic Rent shall be an amount equal to the
Aircraft’s Fair Market Rental Value, which shall be determined in accordance
with Paragraph (c) hereof and the Expiration Date shall be the last day of the
Renewal Term. During the Renewal Term, Basic Rent shall be payable in the same
manner and frequency as the Basic Rent was payable during the Basic Term, which
payment dates shall be deemed “Basic Rent Dates” for purposes of this
Lease.


 


(c) Determination
of Fair Market Sales and Rental Values. If Lessee has elected either of the
options specified above, then as soon as practicable thereafter, Lessor and
Lessee shall consult for the purpose of determining the Fair Market Sales Value
or Fair Market Rental Value, as applicable, of the Aircraft as of the end of
the Basic Term, and any values agreed upon in writing between Lessor and Lessee
shall be binding on both parties. If Lessor and Lessee fail to agree upon any
such value prior to one hundred thirty-five (135) days before the expiration of
the Basic Term, Lessor shall then appoint an independent appraiser (reasonably
acceptable to Lessee) to determine the applicable value, and such determination
by the independent appraiser shall be made within thirty (30) days after such
appointment and shall be binding on Lessor and Lessee. The independent
appraiser shall make any such determination utilizing the definition of Fair
Market Sales Value or Fair Market Rental Value, as the case may be, including
all assumptions. Lessee agrees to pay the costs and expenses of any such
determination and appraisal.


 


(d) Time to
Exercise Option. Notwithstanding the provisions of Paragraphs (a) and (b),
Lessee shall be deemed to have waived the foregoing purchase option and renewal
option unless Lessee provides Lessor with written notice of its irrevocable
election to exercise the applicable option within one hundred eighty (180) days
prior to the expiration of the Basic Term.


 


(e) Early
Purchase Option. So long as no Default or Event of Default shall have
occurred, Lessee may, upon giving its irrevocable written notice to Lessor at
least one hundred twenty (120) days but no more than one hundred eighty (180)
days prior to the proposed Early Purchase Date, purchase the


 


35

















 


Aircraft on the Early
Purchase Date for an amount, payable in immediately available funds, equal to
the applicable Early Purchase Option Amount, plus any applicable impositions
resulting from such sale, together with any Basic Rent due and payable on or
before the Early Purchase Date and all other accrued and unpaid Rent. Lessor’s
sale of the Aircraft shall be on an “AS-IS-WHERE-IS”
basis. The Lease shall not be deemed terminated unless, on the Early
Purchase Option Date, (i) Lessor receives the amounts specified in the
preceding sentence in indefeasible funds, and (ii) Lessee satisfies any and all
other conditions imposed by Lessor with respect to the sale of the Aircraft.


 


36
















 


RETURN
ADDENDUM (“Return Addendum”) to Aircraft Lease (S/N
525-0497) dated as of October 5, 2007, (the “Lease”) by and between BANC
OF AMERICA LEASING & CAPITAL, LLC, as lessor (“Lessor”) , and Ahern
Rentals, Inc. (the “Corporate Lessee”) and Don F. Ahern (“Ahern”), as
co-lessees (collectively, the Corporate Lessee and Ahern are referred to
hereinafter as the “Lessee”) (“Lessee”).


 


All capitalized
terms not defined in this Return Addendum are defined in the Lease. Execution
of the Lease by Lessee and Lessor shall be deemed to constitute execution and
acceptance of the terms and conditions of this Return Addendum, and it shall
supplement and be a part of the Lease.


 


(a) Condition
Upon Return. Unless purchased by Lessee, upon the expiration, cancellation,
or other termination of the Lease, Lessee will return the Aircraft (together
with all Records) to Lessor at a location specified by Lessor within the
continental U.S. The Aircraft shall be fully equipped with the Engines or the
same number, make, and model of engines as are set forth on Schedule No. 1,
which shall fully comply with the Lease, and which, in the opinion of Lessor,
have the same or improved utility, value, useful life, performance, and
efficiency (normal wear and tear excepted) as the Engines had on the Acceptance
Date and are suitable for use on the Airframe and owned by Lessor and properly
installed thereon. The Aircraft, at Lessee’s expense, upon redelivery pursuant
hereto (i) shall have a currently effective FAA airworthiness certificate; (ii)
shall be free and clear of all Liens other than the Lease and any Lessor’s
Liens; (iii) shall be in the same configuration, coloring and appearance and in
the same operating condition, ordinary wear and tear excepted, as when
delivered to Lessee on the Acceptance Date or, at Lessor’s option, Lessee shall
pay to Lessor an amount equal to the actual cost of such restoration; (iv)
shall be in good operating condition, physical condition and appearance
(ordinary wear and tear excepted), with all systems operating normally; (v)
shall have no damage history, unless such damage has been repaired in
accordance with the Lease; (vi) shall have no open mandatory service bulletins
or airworthiness directives, and if terminating action is required within six
(6) months of the date of return, Lessee shall comply with each of the same by
terminating action, and shall be in compliance with all other Applicable Law
and Maintenance Requirement; and (vii) shall be otherwise in the condition and
repair required under the Lease.


 


(b) Damage History and Excess Use Compensation.


 


(i) Damage History. If Lessor is of the opinion that the
Aircraft’s fair market sales value is diminished due to the existence of any
damage history, Lessor and Lessee shall consult for the purpose of determining
the Diminution Amount (as defined below), and any values agreed upon in writing
between Lessor and Lessee shall be binding on both parties. The “Diminution
Amount” shall mean the amount by which (A) the Fair Market Sales Value of
the Aircraft without such damage history, exceeds (B) the Fair Market Sales
Value of the Aircraft with such damage history (and as to this sub-clause (B),
without making the assumption in clause (iii)(B) of the definition of Fair
Market Sales Value). If Lessee and Lessor fail to agree within ten (10) days
after the return of the Aircraft to Lessor, then Lessor shall appoint an
independent appraiser (reasonably acceptable to Lessee) to determine the
Diminution Amount. Lessee agrees to pay the costs and expenses of any such determination
and appraisal. The independent appraiser shall be required to complete such
determination as promptly as practicable, but in any event, not later than
forty (40) days after the date on which it is appointed. A final determination
by the independent appraiser regarding the extent of any Diminution Amount
shall be binding on Lessee and Lessor. Lessee shall pay to Lessor within ten
(10) days after the independent appraiser’s determination an amount equal to
the Diminution Amount, if any.


 


(ii) Excess Use.
Upon the return of the Aircraft to Lessor, Lessor and Lessee shall consult for
the purpose of determining the Excess Use Amount (as defined below), if any,
and any amount agreed upon in writing between Lessor and Lessee shall be
binding on both parties. The “Excess Use Amount” shall mean the amount,
if any, by which (A) the Fair Market Sales Value of the Aircraft without such
Excess Hours, exceeds (B) the Fair Market Sales Value of the Aircraft with such
Excess Hours (and as to this subclause (B), without making the assumption in
clause (iii)(C) of the definition of Fair Market Sales Value). If Lessor and
Lessee fail to agree within ten (10) days after the return of the Aircraft to
Lessor, then Lessor shall appoint an independent appraiser (reasonably
acceptable to Lessee)


 


37

















 


to determine the Excess
Use Amount Lessee agrees to pay the costs and expenses of any such
determination and appraisal. The independent appraiser shall be required to
complete such determination as promptly as practicable, but in any event, not
later than forty (40) days after the date on which it is appointed. A final
determination by the independent appraiser regarding the extent of the Excess
Use Amount, if any, shall be binding on Lessor and Lessee. Lessee shall pay to
Lessor within ten (10) days after the independent appraiser’s determination an
amount equal to the Excess Use Amount.


 


(c) Mid-Life
Condition. Upon return (i) each Engine and APU shall have available
operating hours or months until the next scheduled “hot section” inspection,
mid-life inspection or the next scheduled major overhaul of not less than fifty
percent (50%) of the total operating hours or months available between such hot
section inspection, mid-life inspection, or major overhaul, as the case may be;
(ii) the Airframe shall have remaining not less than (aa) fifty percent (50%)
of the available operating hours allowed between major airframe inspections;
and (bb) fifty percent (50%) of the number of available operating months
allowed between major airframe inspections until the next scheduled major
airframe inspection; and (iii) all life limited parts and components shall have
remaining not less than fifty percent (50%) of the available hours, cycles and/or
months, as the case may be, until the next scheduled replacement. In addition
to the requirements set forth in clauses (i), (ii), and (iii) above, all
inspections and scheduled maintenance required to be performed on the Airframe,
Engines and APU and all life limited parts and components within one hundred
twenty (120) days of the date of return and/or one hundred (100) hours of
additional operation shall have been performed by Lessee.


 


(d) Engines.
If any Engine does not comply with Paragraph (c)(i) above, for each such Engine
Lessee shall pay Lessor an amount equal to either (i) the current estimated
cost of the next scheduled “hot section” or mid-life inspection, as the case
may be (including in such estimated cost, all required replacements of life limited
parts) multiplied by the fraction wherein the numerator shall be the greater of
(A) zero, and (B) the difference between (x) the actual number of operating
hours or months since the previous hot section or mid-life inspection, as the
case may be, and (y) fifty percent (50%) of the total operating hours or months
allowable between hot section or mid-life inspections, as the case may be and
the denominator shall be the total operating hours or months allowable between
hot section or mid-life inspection, as the case may be, or (ii) for each such
Engine, the product of the current estimated cost of the next scheduled major
overhaul (including in such estimated cost, all required replacements of life
limited parts) multiplied by the fraction wherein the numerator shall be the
greater of (A) zero, and (B) the difference between (x) the actual number of
hours of operation since the previous major overhaul, and (y) fifty percent
(50%) of the total operating hours allowable between major overhauls, and the
denominator shall be the total operating hours allowable between major
overhauls. Lessee shall, immediately upon request, assign to Lessor its rights
under any manufacturer’s maintenance service contract or extended warranty for
the Aircraft, any engine, any APU, or part.


 


(e) Airframe.
If the Airframe does not comply with Paragraph (c)(ii) above, Lessee shall pay
to Lessor an amount equal to the sum of the product of the current estimated
cost of the next scheduled major airframe inspection (including in such estimated
cost, all required replacement of the limited parts) multiplied by the fraction
wherein the numerator shall be the greater of (i) zero, and (ii) the difference
between (x) the actual number of respective operating hours or months of
operation since previous major airframe inspection, and (y) 50% of the
respective total operating hours or months of operation  allowable between scheduled major airframe
and pressure vessel inspections,  and the
denominator shall be the respective total operating hours or months of
operation between scheduled major airframe inspections.


 


(f) Maintenance
Contracts. Lessee need not compensate Lessor as contemplated in Paragraphs
(d) or (e), as the case may be, if at the time of the return of the Aircraft to
Lessor:


 


(i) in the case of
Paragraph (d) above.


 


(A)
both of the Engines are covered by a service and maintenance contract in form
and substance satisfactory to Lessor which provides for the maintenance and/or
overhaul of such property.


 


38

















 


(B)
either (x) adequate reserves for future required maintenance and/or overhaul
shall have been provided for pursuant to such maintenance contract, or (y) all
amounts due and payable pursuant to such maintenance contract shall have been
paid in full through the date of return, and


 


(C)
the entity that provides the maintenance and/or overhaul services under such
maintenance contract shall either (x) recognize the transfer by Lessee to
Lessor of the rights and interests of Lessor (or its designee) under such
maintenance contract, or (y) acknowledge the rights and interests of Lessor (or
its designee) under such maintenance contract, and


 


(ii) in the case
of Paragraph (e) above,


 


(A)
the Airframe is covered by a service and maintenance contract in form and
substance satisfactory to Lessor which provides for the maintenance and/or
overhaul of such property.


 


(B)
either (x) adequate reserves for future required maintenance and/or overhaul
shall have been provided for pursuant to such maintenance contract, or (y) all
amounts due and payable pursuant to such maintenance contract shall have been
paid in full through the date of return, and


 


(C)
The entity that provides the maintenance and/or overhaul services under such
maintenance contract shall either (x) recognize the transfer by Lessee to
Lessor of the rights and interests of Lessor (or its designee) under such
maintenance contract, or (y) acknowledge the rights and interests of Lessor (or
its designee) under such maintenance contract.


 


(g) Parts and
Components. If any life limited part or component does not comply with
Paragraph (c)(iii) above, Lessee shall pay to Lessor with respect to each part
or component for which said requirement is not met the dollar amount obtained
by multiplying (i) the ratio that the life expended in excess of fifty percent
(50%) of the available hours, cycles and/or months, as the case may be, until
the next scheduled replacement bears to the total allowable life (measured in
hours, cycles and/or months, as the case may be) for such part or component by
(ii) Lessor’s cost of replacement of such part or component. Lessor’s cost of
replacement of a part or component shall include Lessor’s then current cost of
purchasing the part or component itself and all of Lessor’s then current costs
associated with the replacement.


 


(h) Inspection
Overhaul Charges. All restoration costs and prorated inspection and/or
overhaul charges, if any, shall be due upon presentation to Lessee of an
invoice setting forth in reasonable detail the calculation of such amounts due,
including the names of all sources used for the required cost estimates. Unless
both Lessor and Lessee agree to an alternative source, or as provided herein,
the Manufacturers of the Airframe and Engines shall be used as the sources for
all cost estimates.


 


(i) Fuel.
Upon return, each fuel tank shall contain no less than fifty percent (50%) of
its full capacity, or in the case of differences in such quantity, an
appropriate adjustment will be made at the then current market price of fuel.


 


(j) Records.
Lessee shall deliver all Records to Lessor, including:


 


(i)
Originals of all of the following: (A) all records of maintenance, preventative
maintenance, alterations and major repairs, (B) all Airframe and Engine
logbooks endorsed for current total time and cycles for the airframe, total
time and cycles for each Engine and an entry for total time and cycles since
overhaul and hot section inspection for each Engine; and the Airframe logbook
must include all appropriate endorsements (i.e., maintenance releases)
verifying that the avionics have been periodically tested and inspected in
accordance with all applicable provisions of the FARs and the applicable
maintenance program, (C) a current written summary certified by a FAA-licensed
mechanic listing the status of all applicable airworthiness directive and
service bulletins for the Airframe, Engines, any APU, Parts and appliances, and
(D) a written summary certified by a FAA-licensed mechanic of the current
status of life limited and/or overhauled components for the Airframe, Engines
(in accordance with the Manufacturer’s recommended


 


39

















 


intervals), Engine
accessories, any APU, Parts and appliances as defined in the most current revision(s)
of all Manufacturers’ maintenance publications applicable to the Aircraft.


 


(ii)
The following documentation and data for each component having an overhaul or
inspection requirement of life limit, which components are identified in
pertinent sections of the maintenance program applicable to the Aircraft as
follows: (A) an airworthiness release certificate or maintenance release tag,
(B) the Vendor work order or copy thereof verifying the details of each
component overhaul, and (C) an appropriate record certifying the date and
expended time status of the component when installed (i.e., copy of log or
inspection squawk card), all of which must be properly organized and provided
on board the Aircraft at the time it is returned to Lessor.


 


(iii)
To the extent not covered above, Lessee will also deliver to Lessor all work
cards, computerized maintenance history, component serviceability tags, STCs,
337s, maintenance manuals, and structural repair manuals.


 


All manuals or
other documents delivered to Lessor that are subject to periodic revision will
be fully up-to-date and current to the latest revision standard of any
particular manual or document. If the Aircraft is on a computerized maintenance
program, such program will be up-to-date in accordance with the Manufacturer’s
recommended maintenance schedule and fully assignable to Lessor at redelivery.
Lessee will provide all of the following Records to Lessor upon return of the
Aircraft to Lessor, regardless of whether Lessee has conducted its periodic
inspections of the Aircraft pursuant to pertinent sections of the Maintenance
Program or in accordance with an inspection program approved by FAA. All
records shall be in English. In the event any Records are missing or incomplete
or otherwise do no comply with the provisions hereof, Lessor shall have the
right to cause any such Records to be reconstructed at Lessee’s expense.


 


(k)       Storage. Upon the expiration,
cancellation or other termination of the Lease, Lessee will, if requested by
Lessor, permit Lessor to store the Aircraft at the Primary Hanger Location or
New Hanger Location for up to thirty (30) days. During such storage period
Lessee will, at its own expense, keep the Aircraft properly hangared and will
permit Lessor or any Person designated by Lessor, including the authorized
representatives of any prospective purchaser, lessee or user of the Aircraft to
inspect the same. Lessee shall bear the risk of loss and shall pay any and all
expenses connected with insuring and maintaining the Aircraft during such
storage period. Notwithstanding the foregoing, upon the cancellation or
termination of the Lease in connection with an Event of Default, the storage
period provided for in this paragraph and the obligation to hangar and insure
the Aircraft shall be unlimited.


 


(l)        Replacement Engines. If any
engine not owned by Lessor shall be installed on the returned Airframe as set
forth in Paragraph (a) hereof, then Lessee will concurrently with such delivery
at its own expense, furnish Lessor with a full warranty bill of sale, in form
and substance satisfactory to Lessor with respect to each such engine and with
a written opinion of FAA Counsel to the effect that, upon such return, Lessor
will acquire a valid and perfected interests in such engine free and clear of all
Liens (except Lessor’s  Liens).
Thereupon, unless a Default or Event of Default shall have occurred and be
continuing. Lessor will transfer to Lessee, on an “AS-IS, WHERE-IS” basis, all of Lessor’s right, title and
interest in and to any Engine not installed on the Airframe at the time of the
return of such Airframe.


 


(m)      Inspections. Not more than
forty-five (45) days prior to the expiration of the Lease, upon the written
request of Lessor, Lessee shall certify to Lessor that the Aircraft is in the
condition required by this Return Addendum, or indicate what maintenance or
repair is needed to bring the Aircraft to the specified condition. Without
limiting the provisions of Section 14(d) of the Lease, Lessor shall have the
right, but not the duty, to inspect the Aircraft, any component thereof and/or
the Records, at any reasonable time and from time to time, wherever located,
upon reasonable prior written notice to Lessee except that no advance notice
shall be necessary prior to any inspection conducted, and such inspection may
be conducted at any time, after the occurrence of a Default or an Event of
Default. Upon request of Lessor, Lessee shall promptly confirm to Lessor the
location of the Aircraft and/or the Records. Lessee shall be responsible for
the cost of such inspection and shall pay Lessor such amount as additional Rent
within ten (10) days of demand. If the results of such inspection indicate that
the Aircraft, any Engine, any APU or Part, has not


 


40

















 


been maintained or
returned in accordance with the provisions of the Lease, in addition to all
other Rent due under the Lease, Lessee shall pay to Lessor within ten (10) days
of demand, as liquidated damages, the estimated cost of servicing or repairing
any such non-complying item so as to cause it to be in compliance therewith.
Such amount shall be determined by Lessor by obtaining two quotes for such
service or repair work and taking their average. Lessee shall bear the cost, if
any, incurred by Lessor in obtaining such quotes.


 


(n)       Holdover Rent. If Lessee fails to
return the Aircraft (including the Records) at the time, place and in the
condition specified in this Return Addendum, (A) all of Lessee’s obligations
under the Lease shall continue until it is so returned to Lessor, and (B) as
liquidated damages and not as a penalty, and, in addition to all other Rent due
under the Lease, Lessee shall pay to Lessor an amount equal to the greater of
the fair market rent value (which for the purposes of this Section shall be as
determined by Lessor) or the Daily Rent for each day after the end of the Term
to, but excluding the day the Aircraft is actually returned in accordance with
this Return Addendum; provided, however, that the obligation to
pay, or the payment of, any such holdover or additional rent shall neither
extend the time to return, nor constitute a waiver of any Default or Event of
Default arising by reason of such failure to return. Such amount shall be
payable upon the earlier of Lessor’s demand or the return of the Aircraft in
accordance with the Lease.


 


(o)       Lease Termination. Lessee agrees
to execute, if requested by Lessor, a lease termination statement.


 


(p)       Supplemental Rent. All of the
amounts payable under this Return Addendum shall constitute Supplemental Rent.


 


(q)       Survival. The provisions of this
Return Addendum shall survive the expiration, cancellation or other termination
of the Lease and the return of the Aircraft to Lessor for any reason
whatsoever.


 


(r)        Injunctive Relief. Without limiting
any other terms or conditions of the Lease, the provisions of this Return
Addendum are of the essence of the Lease, and upon application to any court of
equity having jurisdiction, Lessor shall be entitled to a decree against Lessee
requiring specific performance of the covenants of Lessee set forth herein.


 


41

















 


LEASE SUPPLEMENT

(Acceptance
Certificate)


 


This LEASE
SUPPLEMENT (this “Lease Supplement”), is being entered into as of  October 5, 2007, by Ahern Rentals, Inc. (the “Corporate
Lessee”) and Don F. Ahern (“Ahern”), as co-lessees (collectively, the Corporate
Lessee and Ahern are referred to hereinafter as the “Lessee”) (“Lessee”),
pursuant to that certain Aircraft Lease (S/N 525-0497) dated as of October 5,
2007,  (the “Lease”) by and
between Banc of America Leasing & Capital LLC, as lessor (“Lessor”)
and Lessee,  and this Lease Supplement
shall constitute a part of the Lease.


 


(a)       Acceptance of Aircraft. Lessee
hereby acknowledges, agrees, and certifies to Lessor that the Aircraft
described in Schedule No. 1 hereto: (1) is in Lessee’s possession, has been
inspected by Lessee to its complete satisfaction, has been found to be in good
working order, repair and condition and fully equipped to operate under
Applicable Law, (2) is of a size, design, capacity and manufacture selected by
Lessee and suitable for Lessee’s purposes, and (3) is as of the date hereby (“Acceptance
Date”), unconditionally, irrevocably and fully accepted by Lessee for lease
under the Lease. Lessee hereby further unconditionally and irrevocably
reaffirms its acknowledgments and agreements in the Lease. All capitalized
terms used herein which are not otherwise defined herein shall have the
meanings given to such terms in the Lease.


 


(b)       Acknowledgments and Representations by
Lessee. Lessee hereby acknowledges, agrees, and certifies to Lessor that:


 


(1)       The representations and warranties of
Lessee set forth in the Lease and all certificates and opinions delivered in
connection with the Lease were true and correct in all respects when made and
are true and correct as of the date hereof, with the same force and effect as
if the same had been made on this date.


 


(2)       Lessee has obtained, and there are in
full force and effect, all insurance policies required under the Lease, and
Lessee has caused evidence of the required coverage to be provided to Lessor
prior to the date hereof. Lessee has also satisfied or complied with all of the
other conditions precedent set forth in the Lease, including those set forth in
the Closing Terms Addendum.


 


(3)       No Default or Event of Default exists as
the date of this Lease Supplement.


 


(4)       Lessee has furnished no equipment for the
Aircraft other than (i) as stated on Schedule No. 1, or (ii) permitted as an
Addition pursuant to this Lease.


 


(5)       The facts, terms, information,
description, and costs set forth in the attached Schedule  No. 1, No. 2, No. 2-A, and No. 3 are true,
complete, accurate and correct.


 


(6)       Each financial statement delivered to
Lessor prior to the date of this Lease Supplement was prepared in accordance
with GAAP, and since the date of the most recent financial statement (as
specified on Schedule No. 2) there has been no material adverse change in the
financial condition of Lessee.


 


(7)       LESSOR
HAS NOT MANUFACTURED OR SUPPLIED THE AIRCRAFT, AND LESSOR ACQUIRED THE AIRCRAFT
IN CONNECTION WITH THE LEASE. LESSEE HAS SELECTED THE AIRCRAFT AND MAINTENANCE
PROVIDERS WITHOUT ANY ASSISTANCE FROM LESSOR, ITS AGENTS  OR EMPLOYEES AND LESSEE IS LEASING THE
AIRCRAFT “AS-IS, WHERE-IS” AND “WITH ALL FAULTS”. This Lease shall
be deemed a “finance lease” under Section 2A-103 (g) of the UCC.


 


[SIGNATURES
ON NEXT PAGE]


 


42

















 


IN WITNESS WHEREOF,
Lessee has caused this Lease Supplement to be duly executed by its officer
thereunto duly authorized.


 


 


	
   

  	
   

  	
   

  	
  Ahern Rentals, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Don F. Ahern

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  DON F. AHERN

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  PRESIDENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Don F. Ahern

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Don F. Ahern

  	
   

  
	
   

  	
   

  	
   

  	
  Print Name:

  	
  Don F. Ahern

  	
   

  
											



 


 


This is Counterpart No. 2
of a total of 3 counterparts. Only Counterpart No. 1 shall be considered
chattel paper for purposes of the Uniform Commercial Code and a security
interest may be perfected only by possession of Counterpart No. 1.


 

















 


SCHEDULE
NO. 1


 


TO


 


LEASE
SUPPLEMENT


 


DESCRIPTION
OF AIRCRAFT


 


Cessna model 525 aircraft
which consists of the following components:


 


(a) Airframe
bearing United States Registration number N525JJ and manufacturer’s serial
number 

525-0497.


 


(b) Two (2)
Williams (referred to on the International Registry as Williams International
Co LLC) generic model FJ44-1A engines bearing manufacturer’s serial numbers
2000 and 2012 (each of which has 550 or more rated takeoff horsepower or the
equivalent of such horsepower).


 


(c) Standard
avionics and equipment, optional equipment, and such other items fitted or
installed on the Aircraft and as may be more particularly described
hereinafter:


 


See Schedule A that
is attached hereto and made a part hereof.


 


(d) Those items of
Lessee furnished equipment which are installed on the aircraft and are as
described in a bill of sale or bills of sale therefore, delivered by Lessee to
Lessor (copies of which may be appended hereto).


 


 


	
  Manufacturer of Airframe:

  	
   

  	
  Cessna Aircraft Company

  
	
  Manufacturer of Engines:

  	
   

  	
  Williams International Co LLC

  



 


44

















 


SCHEDULE
A


 


AVIONICS AND EQUIPMENT


 


Collins ProLine 21
Avionics Package including:


EFIS/FD/AP: Three Collins
8x10 EFIS Displays

COMMS/NAVS: Dual Honeywell CNI-5000

EGPWS: Honeywell Mark V

Transponders: Dual Honeywell KT-70

Weather Radar: Collins RTA-800

Radar Altimeter: Collins ALT-55B

TCAS: Honeywell CAS-66 TCAS 1

FMS: Universal UNS-1K w/ Improved LCD Glass

HF: Honeywell HF Transceiver

CVR: L3 Communications

Flitefone: AirCell AT.01 w/ Dual Handsets

ELT: Artex

SECAL

IFIS Electronic Chart Installation

XM Satellite Weather

Universal Permanent Data Transfer Unit


Precise Light Pulselite
System

Devore Tail Logo Lights

Ski Tube

Snow Ski Compartment

Scott EROS Crew Mask w/ Smoke Googles

Medco Door Locks

B&D 1500 Cabin Information Display

N1 Safe Flight Computer

50 Cubic Foot Oxygen System

PSU Indirect Lighting

Three 110V Electrical Outlets

Inverter Located Outside Pressure vessel

Dispatch Ground Power for FMS/COM 2 & Audio

Enclosed Bravo Style Entrance Steps


 


 


TOGETHER WITH ALL
ADDITIONS, ACCESSIONS, MODIFICATIONS, IMPROVEMENTS, REPLACEMENTS,
SUBSTITUTIONS, AND ACCESSORIES THERETO AND THEREFOR, ALL AVIONICS, ONBOARD
EQUIPMENT, LOOSE EQUIPMENT, MANUALS, DOCUMENTATION AND TECHNICAL PUBLICATIONS,
NOW OWNED OR HEREAFTER ACQUIRED, AND ALL RECORDS AND LOGBOOKS (IN WRITTEN FORM
OR AS COMPUTER DATA, DISCS OR TAPES, WHETHER NOW EXISTING OR HEREAFTER ACQUIRED
OR CREATED, AND WHETHER IN THE POSSESSION OF LESSEE OR HELD ON BEHALF OF LESSEE
BY OTHERS).


 


45

















 


SCHEDULE NO. 2


 


TO


 


LEASE SUPPLEMENT


 


FINANCIAL TERMS


 


 


	
  Rent Commencement Date:

  	
   

  	
  October 5, 2007

  
	
   

  	
   

  	
   

  
	
  Basic Term:

  	
   

  	
  123 months commencing with the Rent Commencement
  Date through and including the Expiration Date

  
	
   

  	
   

  	
   

  
	
  Renewal Term:

  	
   

  	
  12 months commencing with the day next succeeding
  the Expiration Date, through and including the last day of the 12th month of
  such term.

  
	
   

  	
   

  	
   

  
	
  Basic Rent Dates:

  	
   

  	
  the 5th day of each and every calendar month from
  and including the First Basic Rent Date through and including the Last Basic
  Rent Date

  
	
   

  	
   

  	
   

  
	
  First Basic Rent Date:

  	
   

  	
  October 5, 2007

  
	
   

  	
   

  	
   

  
	
  Last Basic Rent Date:

  	
   

  	
  December 5, 2017

  
	
   

  	
   

  	
   

  
	
  Expiration Date:

  	
   

  	
  December 4, 2017

  
	
   

  	
   

  	
   

  
	
  Corporate Lessee’s Exact Legal Name:

  	
   

  	
  Ahern Rentals, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Corporate Lessee’s Form of Organization,

  	
   

  	
  Corporation

  	
   

  
	
  State of Organization and

  	
   

  	
  Nevada

  	
   

  
	
  Organizational Identification Number:

  	
   

  	
  C28916- 1997

  	
   

  
	
  Federal Tax Identification Number:

  	
   

  	
  88-0381960

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Corporate Lessee’s Chief Executive Offices

  	
   

  	
   

  	
   

  
	
  and Principal Place of Business:

  	
   

  	
  4241 S. Arville

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89103

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Corporate Lessee’s Mailing Address:

  	
   

  	
  4241 S. Arville

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89103

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Ahern’s Exact Legal Name:

  	
   

  	
  Don F. Ahern

  	
   

  
	
  Ahern’s State of Residence:

  	
   

  	
  Nevada

  	
   

  
	
  Ahern’s Social Security Number:

  	
   

  	
  ###-##-####

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Ahern’s Address:

  	
   

  	
  8621 Scarsdale Drive

  	
   

  
	
   

  	
   

  	
  Las Vegas, NV 89117

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Primary Hangar Location:

  	
   

  	
  c/o Hutt Aviation. Inc.

  	
   

  
	
   

  	
   

  	
  1151 Airport Road

  	
   

  
	
   

  	
   

  	
  Minden, NV 89423

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  New Hangar Location:

  	
   

  	
  c/o Ahern Rentals, Inc.

  	
   

  
	
   

  	
   

  	
  Citizen Avenue

  	
   

  



 


46

















 


	
   

  	
   

  	
  Las Vegas, NV 89032

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Acceptance Date:

  	
   

  	
  October 5, 2007

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Last Acceptance Date:

  	
   

  	
  October 30, 2007

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date of Last Financial Statements:

  	
   

  	
  June 30, 2007

  	
   

  



 


47

















 


SCHEDULE NO. 2-A


 


TO


 


LEASE SUPPLEMENT


 


	
   

  	
   

  	
  Percentage of Lessor’s Cost

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Daily Rent Percentage:

  	
   

  	
  0.023172%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Basic Rent Percentage:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Basic Rent Number:

  	
   

  	
  Percentage of Lessor’s Cost

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1-123

  	
   

  	
  0.695162%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Early Purchase Option Amount(s):

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Basic Rent Number(s)

  	
   

  	
  Percentage of Lessor’s Cost

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  After payment 64

  	
   

  	
  81.13%

  	
   

  
	
  After payment 112

  	
   

  	
  60.18%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Estimated Annual Hours:

  	
   

  	
  500

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Renewal Term:

  	
   

  	
  12 months

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Lessor’s Cost:

  	
   

  	
  $3,550,000.00

  	
   

  



 


 


	
   

  	
   

  	
  Initials:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Corporate Lessee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Ahern:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Lessor:

  	
   

  	
   

  
								



 


48
















 


SCHEDULE NO. 3


 


TO


 


LEASE SUPPLEMENT


 


CASUALTY VALUES


 


Subject to the terms of the
Lease, the Casualty Value of the Aircraft due on any Basic Rent Date shall be
an amount equal to the Lessor’s Cost multiplied by the applicable percentage
set forth opposite the Basic Rent number corresponding to such Basic Rent Date.
Upon the exercise of any option to renew the Term by Lessee, Lessor shall
provide to Lessee a new Schedule No. 3 setting forth the Casualty Values for
the Renewal Term.


 


 


	
  BASIC RENT

  NUMBER

  	
   

  	
  CASULATY

  VALUE

  	
   

  	
  BASIC RENT

  NUMBER

  	
   

  	
  CASULATY

  VALUE

  	
   

  	
  BASIC RENT

  NUMBER

  	
   

  	
  CASULATY

  VALUE

  
	
  1

  	
   

  	
  103.305

  	
   

  	
  48

  	
   

  	
  91.403

  	
   

  	
  95

  	
   

  	
  72.690

  
	
  2

  	
   

  	
  103.194

  	
   

  	
  49

  	
   

  	
  91.056

  	
   

  	
  96

  	
   

  	
  72.251

  
	
  3

  	
   

  	
  103.082

  	
   

  	
  50

  	
   

  	
  90.705

  	
   

  	
  97

  	
   

  	
  71.812

  
	
  4

  	
   

  	
  102.943

  	
   

  	
  51

  	
   

  	
  90.352

  	
   

  	
  98

  	
   

  	
  71.372

  
	
  5

  	
   

  	
  102.789

  	
   

  	
  52

  	
   

  	
  89.994

  	
   

  	
  99

  	
   

  	
  70.928

  
	
  6

  	
   

  	
  102.633

  	
   

  	
  53

  	
   

  	
  89.633

  	
   

  	
  100

  	
   

  	
  70.484

  
	
  7

  	
   

  	
  102.474

  	
   

  	
  54

  	
   

  	
  89.269

  	
   

  	
  101

  	
   

  	
  70.039

  
	
  8

  	
   

  	
  102.306

  	
   

  	
  55

  	
   

  	
  88.903

  	
   

  	
  102

  	
   

  	
  69.590

  
	
  9

  	
   

  	
  102.131

  	
   

  	
  56

  	
   

  	
  88.535

  	
   

  	
  103

  	
   

  	
  69.138

  
	
  10

  	
   

  	
  101.945

  	
   

  	
  57

  	
   

  	
  88.164

  	
   

  	
  104

  	
   

  	
  68.687

  
	
  11

  	
   

  	
  101.753

  	
   

  	
  58

  	
   

  	
  87.791

  	
   

  	
  105

  	
   

  	
  68.233

  
	
  12

  	
   

  	
  101.559

  	
   

  	
  59

  	
   

  	
  87.416

  	
   

  	
  106

  	
   

  	
  67.779

  
	
  13

  	
   

  	
  101.354

  	
   

  	
  60

  	
   

  	
  87.038

  	
   

  	
  107

  	
   

  	
  67.324

  
	
  14

  	
   

  	
  101.143

  	
   

  	
  61

  	
   

  	
  86.658

  	
   

  	
  108

  	
   

  	
  66.865

  
	
  15

  	
   

  	
  100.929

  	
   

  	
  62

  	
   

  	
  86.275

  	
   

  	
  109

  	
   

  	
  66.406

  
	
  16

  	
   

  	
  100.705

  	
   

  	
  63

  	
   

  	
  85.890

  	
   

  	
  110

  	
   

  	
  65.946

  
	
  17

  	
   

  	
  100.474

  	
   

  	
  64

  	
   

  	
  85.502

  	
   

  	
  111

  	
   

  	
  65.482

  
	
  18

  	
   

  	
  100.241

  	
   

  	
  65

  	
   

  	
  85.112

  	
   

  	
  112

  	
   

  	
  65.018

  
	
  19

  	
   

  	
  100.005

  	
   

  	
  66

  	
   

  	
  84.719

  	
   

  	
  113

  	
   

  	
  64.552

  
	
  20

  	
   

  	
  99.764

  	
   

  	
  67

  	
   

  	
  84.324

  	
   

  	
  114

  	
   

  	
  64.083

  
	
  21

  	
   

  	
  99.517

  	
   

  	
  68

  	
   

  	
  83.928

  	
   

  	
  115

  	
   

  	
  63.611

  
	
  22

  	
   

  	
  99.265

  	
   

  	
  69

  	
   

  	
  83.531

  	
   

  	
  116

  	
   

  	
  63.139

  
	
  23

  	
   

  	
  99.008

  	
   

  	
  70

  	
   

  	
  83.134

  	
   

  	
  117

  	
   

  	
  62.655

  
	
  24

  	
   

  	
  98.749

  	
   

  	
  71

  	
   

  	
  82.735

  	
   

  	
  118

  	
   

  	
  62.191

  
	
  25

  	
   

  	
  98.484

  	
   

  	
  72

  	
   

  	
  82.334

  	
   

  	
  119

  	
   

  	
  61.715

  
	
  26

  	
   

  	
  98.214

  	
   

  	
  73

  	
   

  	
  81.932

  	
   

  	
  120

  	
   

  	
  61.235

  
	
  27

  	
   

  	
  97.941

  	
   

  	
  74

  	
   

  	
  81.529

  	
   

  	
  121

  	
   

  	
  60.756

  
	
  28

  	
   

  	
  97.663

  	
   

  	
  75

  	
   

  	
  81.123

  	
   

  	
  122

  	
   

  	
  60.274

  
	
  29

  	
   

  	
  97.380

  	
   

  	
  76

  	
   

  	
  80.717

  	
   

  	
  123

  	
   

  	
  60.000

  
	
  30

  	
   

  	
  97.094

  	
   

  	
  77

  	
   

  	
  80.309

  	
   

  	
   

  	
   

  	
   

  
	
  31

  	
   

  	
  96.806

  	
   

  	
  78

  	
   

  	
  79.898

  	
   

  	
   

  	
   

  	
   

  
	
  32

  	
   

  	
  96.514

  	
   

  	
  79

  	
   

  	
  79.485

  	
   

  	
   

  	
   

  	
   

  
	
  33

  	
   

  	
  96.219

  	
   

  	
  80

  	
   

  	
  79.071

  	
   

  	
   

  	
   

  	
   

  
	
  34

  	
   

  	
  95.920

  	
   

  	
  81

  	
   

  	
  78.656

  	
   

  	
   

  	
   

  	
   

  
	
  35

  	
   

  	
  95.618

  	
   

  	
  82

  	
   

  	
  78.241

  	
   

  	
   

  	
   

  	
   

  
	
  36

  	
   

  	
  95.313

  	
   

  	
  83

  	
   

  	
  77.824

  	
   

  	
   

  	
   

  	
   

  
	
  37

  	
   

  	
  95.005

  	
   

  	
  84

  	
   

  	
  77.404

  	
   

  	
   

  	
   

  	
   

  
	
  38

  	
   

  	
  94.693

  	
   

  	
  85

  	
   

  	
  76.984

  	
   

  	
   

  	
   

  	
   

  
	
  39

  	
   

  	
  94.379

  	
   

  	
  86

  	
   

  	
  76.563

  	
   

  	
   

  	
   

  	
   

  
	
  40

  	
   

  	
  94.061

  	
   

  	
  87

  	
   

  	
  76.138

  	
   

  	
   

  	
   

  	
   

  
	
  41

  	
   

  	
  93.740

  	
   

  	
  88

  	
   

  	
  75.714

  	
   

  	
   

  	
   

  	
   

  
	
  42

  	
   

  	
  93.416

  	
   

  	
  89

  	
   

  	
  75.288

  	
   

  	
   

  	
   

  	
   

  
	
  43

  	
   

  	
  93.089

  	
   

  	
  90

  	
   

  	
  74.858

  	
   

  	
   

  	
   

  	
   

  
	
  44

  	
   

  	
  92.759

  	
   

  	
  91

  	
   

  	
  74.426

  	
   

  	
   

  	
   

  	
   

  
	
  45

  	
   

  	
  92.425

  	
   

  	
  92

  	
   

  	
  73.994

  	
   

  	
   

  	
   

  	
   

  
	
  46

  	
   

  	
  92.088

  	
   

  	
  93

  	
   

  	
  73.560

  	
   

  	
   

  	
   

  	
   

  
	
  47

  	
   

  	
  91.747

  	
   

  	
  94

  	
   

  	
  73.126

  	
   

  	
   

  	
   

  	
   

  



 


 


	
   

  	
   

  	
  Initials:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Corporate Lessee: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Ahern: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Lessor: 

  	
   

  	
   

  
										



 


49

















 


PAY
PROCEEDS LETTER


 


BANC OF AMERICA LEASING
& CAPITAL, LLC


 


One Financial Plaza


 


Providence, Rhode Island
02903-2448


 


We, the undersigned, hereby
authorize Banc of America Leasing & Capital, LLC (“BALC”) to pay the
following Payee(s) from the proceeds of financial accommodations provided to us
by BALC as evidenced by that certain AIRCRAFT
LEASE (S/N525-0497) dated as October 5, 2007. Make disbursements
directly to said Payee(s) as follows:


 


 


	
  PAYEE

  	
   

  	
  Amount of

  Payment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Insured Aircraft Title Service, Inc.

  	
   

  	
  $

  	
  3,550,000.00

  	
   

  
	
  International Bank of Commerce

  	
   

  	
   

  	
   

  
	
  ABA No.: 114902528

  	
   

  	
   

  	
   

  
	
  Account Name: Insured Aircraft title
  Service, Inc.

  	
   

  	
   

  	
   

  
	
  Account No: 0717213717

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  TOTAL:

  	
   

  	
  $

  	
  3,550,000.00

  	
   

  



 


 


[SIGNATURE
PAGE FOLLOWS]


 

















 


DAUGHERTY, FOWLER, PEREGRIN, HAUGHT & JENSON

A PROFESSIONAL
CORPORATION

ATTORNEYS AT LAW

204 NORTH ROBINSON

Suite 900

OKLAHOMA CITY, OKLAHOMA 73102

TELEPHONE: (405) 232-0003

FACSIMILE: (405) 232-0865

E-MAIL: dfph@dfph.com


 


CONFIRMATION

MEMORANDUM


 


VIA
E-MAIL


 


	
  TO:

  	
   

  	
  Chad Kavanagh

  
	
   

  	
   

  	
   

  
	
  FROM:

  	
   

  	
  Robert M. Peregrin, Esq.

  
	
   

  	
   

  	
   

  
	
  DATE:

  	
   

  	
  October 5, 2007

  
	
   

  	
   

  	
   

  
	
  RE:

  	
   

  	
  One (1) Cessna, generic
  and enhanced model 525, aircraft bearing manufacturer’s serial number
  525-0497 and U.S. Registration No. N525JJ (the “Airframe”) and two (2) Williams
  International Co. LLC, generic and enhanced model FJ44-1A, aircraft engines
  bearing manufacturer’s serial numbers 2000 and 2012 (the “Engines”) (Our
  File: 17700-207.091)

  



 


This will confirm that on
this date we field with the Federal Aviation Administration (the “FAA”) the
following described instruments at the respective times listed below:


 


(a)                                                         AC From 8050-2 Aircraft Bill of Sale dated
October 5, 2007 (“FAA Bill of Sale”) from N525JJ, LLC, as seller, conveying
title to the Airframe to Bell Aviation, Inc. (“Bell”), which  FAA Bill of Sale A was field at 1:26 p.m.,
C.D.T.;


 


(b)                                                        Aircraft Bill of Sale dated October 5, 2007
(“FAA Bill of Sale B”) from Bell, as seller, conveying title to the Airframe
and the Engines to Banc of America Leasing & Capital, LLC (“BALCAP”), which
FAA Bill of Sale B was field at 1:27 p.m., C.D.T.;


 


1