exv10w18






Exhibit 10.18




NON-EXCLUSIVE AIRCRAFT LEASE AGREEMENT




Dated as of the 27 day of June 2011,

between

FALSTAFF PARTNERS LLC

as Lessor,

and

CARLYLE INVESTMENT MANAGEMENT L.L.C.

as Lessee,




concerning one Gulfstream G-550 aircraft bearing U.S. registration number N385WL, and

manufacturer’s serial number 5196



INSTRUCTIONS FOR COMPLIANCE WITH

“TRUTH IN LEASING” REQUIREMENTS UNDER FAR § 91.23



Within 24 hours after execution of this Aircraft Lease Agreement:

mail a copy of the executed document, without Schedule A, to the

following address via certified mail, return receipt requested:



Federal Aviation Administration

Aircraft Registration Branch

ATTN: Technical Section

P.O. Box 25724

Oklahoma City, Oklahoma 73125



At least 48 hours prior to the first flight to be conducted under this Agreement:

provide notice of the departure airport and proposed time of departure

of said first flight, by telephone or facsimile, to the Flight Standards

District Office located nearest the departure airport.



Carry a copy of this Aircraft Lease Agreement in the aircraft at all times.



*     *     *



Schedule A contains only economic rental data and is

intentionally omitted for FAA submission purposes.



 









 




This NON-EXCLUSIVE AIRCRAFT LEASE AGREEMENT (the “Agreement”) is entered into as of June 27, 2011
(the “Effective Date”), by and between FALSTAFF PARTNERS LLC (“Lessor”), and CARLYLE INVESTMENT
MANAGEMENT L.L.C. (“Lessee”).




W I T N E S S E T H :




          WHEREAS, Lessor is, as of the Effective Date of this Agreement, the registered owner or lessee
of the Aircraft described and referred to herein;




          WHEREAS, Lessee desires to lease from the Lessor, and Lessor desires to lease to Lessee, the
Aircraft, upon and subject to the terms and conditions of this Agreement; and




          WHEREAS, during the term of this Agreement, the Aircraft may be subject to concurrent leases
to other lessees.




          NOW, THEREFORE, in consideration of the mutual promises herein contained and other good and
valid consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties
agree as follows:




SECTION 1. DEFINITIONS





	1.1	 	The following terms shall have the following meanings for all purposes of this Agreement:
	 
	 	 	“Aircraft” means the Airframe and the Engines. Such Engines shall be deemed part of the
“Aircraft” whether or not from time to time attached to the Airframe or on the ground.
	 
	 	 	“Airframe” means that certain Gulfstream G-550 aircraft bearing U.S. registration number
N385WL, and manufacturer’s serial number 5196 together with any and all Parts (including,
but not limited to, landing gear and auxiliary power units but excluding Engines or engines)
so long as such Parts shall be either incorporated or installed in or attached to the
Airframe.
	 
	 	 	“Applicable Law” means, without limitation, all applicable laws, treaties, international
agreements, decisions and orders of any court, arbitration or governmental agency or
authority and rules, regulations, orders, directives, licenses and permits of any
governmental body, instrumentality, agency or authority, including, without limitation, the
FARs, the Federal Aviation Act of 1958 as amended, and Title 49, Subtitle VII of the United
States Code.
	 
	 	 	“Business Day” means any day of the year in which banks are not authorized or required to
close in the location of Lessor’s address for notification.
	 
	 	 	“Engines” means two (2) Rolls-Royce engines bearing manufacturer’s serial numbers 15495 and
15496 together with any and all Parts so long as the same shall be either incorporated or
installed in or attached to such Engine. An Engine shall remain leased hereunder whether or
not from time to time attached to the Airframe or on the ground.





 









 






	 	 	“FAA” means the Federal Aviation Administration of the United States Department of
Transportation or any successor agency.
	 
	 	 	“FARs” means collectively the Aeronautics Regulations of the Federal Aviation Administration
and the Department of Transportation, as codified at Title 14, Parts 1 to 399 of the United
States Code of Federal Regulations.
	 
	 	 	“Flight Crew” has the meaning specified in Section 5.3 of this Agreement.
	 
	 	 	“Flight Hour” means each flight hour of use of the Aircraft by Lessee, as recorded on the
Aircraft hour meter and measured from the time the Aircraft wheel blocks are removed at the
beginning of a flight, to the time the Aircraft wheel blocks are replaced after the Aircraft
lands at the end of a flight in one-tenth (1/10th) of an hour increments. Flight Hours also
include any flight hours consumed in repositioning the Aircraft to facilitate Lessee’s
scheduled itineraries.
	 
	 	 	“FSDO Notice” means a FSDO Notification Letter in the form of Schedule B attached
hereto.
	 
	 	 	“Lien” means any mortgage, security interest, international interest, lease or other charge
or encumbrance or claim or right of others, including, without limitation, rights of others
under any airframe or engine interchange or pooling agreement.
	 
	 	 	“Operating Base” means Dulles International Airport, Virginia.
	 
	 	 	“Operational Control” has the same meaning given the term in Section 1.1 of the FARs.
	 
	 	 	“Parts” means all appliances, components, parts, instruments, appurtenances, accessories,
furnishings or other equipment of whatever nature (other than complete Engines or engines)
which may from time to time be incorporated or installed in or attached to the Airframe or
any Engine and includes replacement parts.
	 
	 	 	“Pilot in Command” has the same meaning given the term in Section 1.1 of the FARs. “Rent
Payment Date” means the last Business Day of each calendar month.
	 
	 	 	“Schedule Keeper” means the person designated by Lessor to coordinate the scheduling of the
Aircraft.
	 
	 	 	“Taxes” means all sales taxes, use taxes, retailer taxes, duties, fees, excise taxes
(including, without limitation, federal transportation excise taxes), or other taxes of any
kind which may be assessed or levied by any Taxing Jurisdiction as a result of the lease of
the Aircraft to Lessee, or the use of the Aircraft by Lessee.
	 
	 	 	“Taxing Jurisdictions” means any federal, state, county, local, airport, district, foreign,
or other governmental authority that imposes Taxes.
	 
	 	 	“Term” means the term of this Agreement set forth in Section 3.1.





 









 





SECTION 2. LEASE AND DELIVERY OF TILE AIRCRAFT





	2.1	 	Lease. Lessor agrees to lease to Lessee, and Lessee agrees to lease from Lessor, the
Aircraft, on the terms and conditions of this Agreement.
	 
	2.2	 	Delivery. The Aircraft shall be delivered by Lessor to the Lessee at the Operating Base or at
such other location that is mutually agreeable by Lessor and Lessee prior to each use of the
Aircraft in “AS IS”, “WHERE AS” condition subject to each and every disclaimer of warranty and
requirements as set forth in Section 4.3 hereof. Upon each such delivery, the United States
standard airworthiness certificate issued for the Aircraft shall be present on board the
Aircraft, and said standard airworthiness certificate shall be effective in accordance with
FAR 21.181(a)(1). Lessor shall not be liable for delay or failure to furnish the Aircraft
pursuant to this Agreement when such failure is caused by government regulation or authority,
mechanical difficulty, war, terrorism, civil commotion, strikes or labor disputes, weather
conditions, or acts of God.
	 
	2.3	 	Non-Exclusivity. Lessee and Lessor acknowledge that the Aircraft is leased to Lessee on a
non-exclusive basis, and that the Aircraft shall, at other times, be operated by Lessor and
may be otherwise subject to lease to others during the Term at Less or’s sole discretion.
During any period during which the Lessor or any other person or entity is utilizing the
Aircraft, Lessee’s leasehold rights to possession of the Aircraft under this Agreement shall
temporarily abate, but all other provisions of this Agreement shall nevertheless continue in
full force and effect.
	 
	2.4	 	FSDO Notice. At least 48 hours prior to the first flight to be conducted under this
Agreement, Lessee shall complete the FSDO Notice attached hereto as Schedule B and deliver the
completed FSDO Notice by facsimile to the FAA Flight Standards District Office located nearest
to the departure airport of said first flight.





SECTION 3. TERM, SCHEDULING, AND RENT





	3.1	 	Term. The Term shall commence on the Effective Date, and be effective for a period of one (1)
year. At the end of the first one (1) year period or any subsequent one (1) year period, the
Term shall automatically be renewed for an additional one (1) year period, unless terminated
by either party. Either party may terminate this Agreement with or without cause upon
forty-eight (48) hours notice to the other party; provided, however, that Lessee shall be
permitted to complete any scheduled use of the Aircraft which has commenced.
	 
	3.2	 	Scheduling. Lessee’s use of the Aircraft during the Term of this Agreement is non-exclusive.
The parties agree as follows:






	 	(a)	 	Use by Lessor and Other Lessees. Lessor and Lessee agree that Lessor
may lease the Aircraft to one or more other lessees during the Term on a non-exclusive
basis, that Lessor has the absolute right to determine the availability of the Aircraft
for Lessee and that Less or’s use of the Aircraft shall have priority over the
availability of the Aircraft for lease to Lessee or any other party. Lessor agrees that
at such times as the Aircraft is not undergoing maintenance or being used by





 









 






	 	 	 	Lessor, Lessee and all other lessees of the Aircraft shall have equal rights to use
of the Aircraft and that all use of the Aircraft shall be scheduled on a “first
come, first served” basis; provided, however, that Lessee and all other lessees
shall cooperate in good faith on all scheduling matters and shall use their
respective best efforts to avoid scheduling conflicts involving the Aircraft.
	 
	 	(b)	 	Designation of Schedule Keeper. Lessor shall advise Lessee of the
individual or entity that will coordinate the scheduling of the Aircraft.
	 
	 	(c)	 	Minimum Usage by Lessee. Nothing contained herein shall obligate Lessee
to any minimum usage of the Aircraft, it being understood and agreed that Lessee’s
usage shall be on an “as-needed” basis.






	3.3	 	Rent. The Lessee shall pay rent in an amount equal to the Hourly Rent specified in
Schedule A attached hereto for each Flight Hour of use of the Aircraft by Lessee. The
amount of Hourly Rent paid during the calendar year (or prorated portion thereof) shall be
compared to the actual utilization costs of the Aircraft at the end of each calendar year
beginning December 31, 2011. If the actual utilization costs exceed the amount of Hourly Rent
paid, Lessee shall pay the amount of such excess to Lessor by the Rent Payment Date in January
of the immediately following year. If the amount of Hourly Rent paid during the calendar year
(or prorated portion thereof) exceeds the actual utilization costs, Lessor shall apply the
amount of such excess to the account of Lessee for credit against future Hourly Rent which is
due under this Agreement. All rent accrued during any calendar month shall be payable in
arrears on the Rent Payment Date in the immediately succeeding calendar month without further
demand or invoice. All rent shall be paid to the Lessor in immediately available U.S. funds
and in form and manner as the Lessor in its sole discretion may instruct Lessee from time to
time. In the event the Lease is terminated by either party pursuant to Section 3.1, Lessee
shall pay upon demand all outstanding Hourly Rent for each used Flight Hour.
	 
	3.4	 	Taxes. Neither rent nor any other payments to be made by Lessee under this Agreement includes
the amount of any Taxes which may be assessed or levied by any Taxing Jurisdictions as a
result of the lease of the Aircraft to Lessee. Lessee shall remit to Lessor all such Taxes
together with each payment of rent pursuant to Section 3.3.





SECTION 4. REPRESENTATIONS AND WARRANTIES; DISCLAIMER OF WARRANTIES





	4.1	 	Representations and Warranties of Lessee. Lessee represents and warrants as of the date
hereof and during the entire Term hereof as follows:






	 	4.1.1	 	Lessee is a validly organized limited liability company under the laws of the State of
Delaware, and the person executing on behalf of Lessee has full power and authority to
execute this Agreement on behalf of Lessee and by such execution shall bind Lessee under
this Agreement.




 









 












	 	4.1.2	 	No action, suit, or proceeding is currently pending or threatened against Lessee which
shall in any material way affect Lessee’s financial status as of the date hereof, or impair
the execution, delivery, or performance by Lessee of this Agreement.
	 
	 	4.1.3	 	The execution and delivery of this Agreement by Lessee and the performance of its
obligations hereunder have been duly authorized by all necessary corporate action and do not
conflict with any provision of Lessee’s articles of organization, bylaws, operating
agreement, any governmental regulations, or any other agreements that Lessee may now have
with other parties.
	 
	 	4.1.4	 	Lessee is not subject to any restriction, which with or without the giving of notice,
the passage of time, or both, prohibits or would be violated by or be in conflict with this
Agreement.
	 
	 	4.1.5	 	Lessee will not permit the Aircraft to be operated in any manner contrary to any manual
or instructions for the Aircraft or in violation of the terms or conditions of any insurance
policy covering the Aircraft or any applicable statute, regulation, ordinance, or other law.






	4.2	 	Representations and Warranties of Lessor. Lessor represents and warrants as of the date
hereof and during the entire Term hereof as follows:






	 	4.2.1	 	Lessor is a validly organized limited liability company under the laws of the State of
Delaware, and the person executing on behalf of Lessor has full power and authority to
execute this Agreement on behalf of Lessor and by such execution shall bind Lessor under
this Agreement.
	 
	 	4.2.2	 	No action, suit, or proceeding is currently pending or threatened against Lessor which
shall in any material way affect Less or’s financial status as of the date hereof, or impair
the execution, delivery, or performance by Lessor of this Agreement.
	 
	 	4.2.3	 	The execution and delivery of this Agreement by Lessor and the performance of its
obligations hereunder have been duly authorized by all necessary limited liability company
action and do not conflict with any provision of Less or’s articles of organization, bylaws,
operating agreement, any governmental regulations, or any other agreements that Lessor may
now have with other parties.






	4.3	 	Disclaimer of Warranties. THE AIRCRAFT IS BEING LEASED BY THE LESSOR TO THE LESSEE HEREUNDER
ON AN “AS IS” BASIS. THE WARRANTIES AND REPRESENTATIONS SET FORTH IN THIS AGREEMENT ARE
EXCLUSIVE AND IN LIEU OF ALL OTHER REPRESENTATIONS OR WARRANTIES, AND LESSOR HAS NOT MADE AND
SHALL NOT BE CONSIDERED OR DEEMED TO HAVE MADE AND LESSEE HEREBY WAIVES, RELEASES, DISCLAIMS
AND RENOUNCES ALL EXPECTATION OF OR RELIANCE UPON ANY WARRANTIES, OBLIGATIONS AND LIABILITIES
OF LESSOR, EXPRESS, IMPLIED, ARISING BY LAW, COURSE OF DEALING, USAGE OF TRADE OR OTHERWISE
WITH RESPECT TO THE DESIGN, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OF THE AIRCRAFT.
LESSOR SHALL HAVE





 









 






	 	 	NO RESPONSIBILITY OR LIABILITY TO LESSEE OR ANY OTHER PERSON WITH RESPECT TO ANY OF THE
FOLLOWING, REGARDLESS OF ANY NEGLIGENCE OR FAULT OF LESSOR: (A) ANY LIABILITY, LOSS OR
DAMAGE CAUSED OR ALLEGED TO BE CAUSED DIRECTLY OR INDIRECTLY BY THE AIRCRAFT OR ANY
COMPONENT OF THE AIRCRAFT OR BY ANY INADEQUACY THEREOF, ANY DEFICIENCY OR DEFECT IN THIS
AGREEMENT OR ANY OTHER CIRCUMSTANCES IN CONNECTION WITH THE AIRCRAFT OR THIS AGREEMENT; (B)
THE USE, OPERATION OR PERFORMANCE OF THE AIRCRAFT OR ANY COMPONENT OF THE AIRCRAFT OR ANY
RISKS RELATING THERETO; OR (C) ANY INTERRUPTION OF SERVICE, LOSS OF BUSINESS OR ANTICIPATED
PROFITS OR CONSEQUENTIAL DAMAGES. LESSEE SHALL INDEMNIFY, DEFEND AND HOLD LESSOR HARMLESS
FROM AND AGAINST ANY AND ALL CLAIMS, ACTIONS, SUITS, PROCEEDINGS, INJURIES (OR DEATH),
DAMAGES, LIABILITIES, COSTS OR EXPENSES (INCLUDING WITHOUT LIMITATION REASONABLE ATTORNEYS’
FEES) ARISING FROM OR IN ANY WAY RELATING TO LESSEE’S LEASE OR POSSESSION OF THE AIRCRAFT
DURING THE TERM AND SUCH INDEMNIFICATION SHALL SURVIVE THE EXPIRATION OR EARLIER TERMINATION
OF THIS AGREEMENT.





SECTION 5. REGISTRATION, USE, OPERATION, MAINTENANCE AND POSSESSION





	5.1	 	Title and Registration. Title to the Aircraft shall remain vested in Lessor at all times
during the Term to the exclusion of Lessee and that Lessor shall have only such rights as
shall be specifically set forth herein. Lessor represents that as of the date of this
Agreement the Aircraft is, and throughout the Term the Aircraft shall remain, lawfully
registered as a civil aircraft of the United States.
	 
	5.2	 	Use and Operation. Except as otherwise expressly provided herein, Lessee shall be solely and
exclusively responsible for the use, operation and control of the Aircraft while in its
possession during the Term of this Agreement. Lessee shall operate the Aircraft in accordance
with the provisions of Part 91 of the FARs and shall not operate the Aircraft in commercial
service, as a common carrier, or otherwise on a compensatory or “for hire” basis except to the
limited extent permitted under Subpart F of Part 91 of the FARs, if applicable. Lessee agrees
not to operate or locate the Airframe or any Engine, or suffer the Airframe or any Engine to
be operated or located, in any area excluded from coverage by any insurance policy in effect
or required to be maintained hereunder with respect to the Airframe or Engines, or in any war
zone. Lessee agrees not to knowingly operate the Airframe or any Engine or knowingly permit
the Airframe or any Engine to be operated during the Term except in operations for which
Lessee is duly authorized, or to knowingly use or permit the Aircraft to be used for a purpose
for which the Aircraft is not designed or reasonably suitable. Lessee will not knowingly use
or operate the Aircraft in violation of any Applicable Law, or contrary to any manufactures
operating manuals or instructions. Lessee shall not knowingly permit the Aircraft to be used
for the carriage of any persons or property prohibited by law nor shall it be used during the
existence of any known defect except in accordance with the FARs.





 









 






	5.3	 	Operating Costs. Except as otherwise provided herein, Lessor shall pay certain fixed and
variable costs of operating the Aircraft, including, without limitation, all costs of
insurance, hangarage at the Operating Base, maintenance and inspections, overhauls, oil and
other lubricants. The foregoing notwithstanding, Lessee shall, at its own expense, (i) pay
costs of fuel required for operation of Lessee’s flights, (ii) pay standard catering costs,
(iii) locate and retain (either through direct employment or contracting with an independent
contractor for flight services) all pilots and other cabin personnel (including mechanic)
required for Lessee’s operations of the Aircraft (collectively the “Flight Crew”), and (iv)
pay all miscellaneous out-of-pocket expenses incurred in connection with Lessee’s operation of
the Aircraft, including, but not limited to, landing fees, ramp fees, overnight hangar fees,
de-icing costs, contaminant recovery costs, special-request catering and commissary costs,
in-flight entertainment and telecommunications charges, ground transportation, Flight Crew
travel expenses, charts, manuals, and other publications obtained for the specific flight, and
any other similar items.
	 
	5.4	 	Maintenance of Aircraft. Lessee shall perform, or cause to be performed, all pre- and post
flight inspections in accordance and as required by the FAA-approved inspection program for
the Aircraft. Lessee shall notify Lessor, or cause Lessor to be notified, of any maintenance
requirement, dangerous condition, malfunction or worn part that may be discovered during any
such inspection. Subject to the foregoing, Lessor shall be solely responsible for arranging
the performance of all maintenance and inspections of the Aircraft during the Term, shall
ensure that the Aircraft is maintained in an airworthy condition during the Term, and shall
coordinate the performance of and payment for all repairs and maintenance of the Aircraft.
	 
	5.5	 	Flight Crew. All members of the Flight Crew shall be fully competent and experienced, duly
licensed, and qualified in accordance with the requirements of Applicable Law and all
insurance policies covering the Aircraft. All members of the Flight Crew who are pilots shall
be fully trained in accordance with an FAA-approved training program; including initial and
recurrent training and, where appropriate, contractor-provided simulator training.
	 
	5.6	 	Operational Control. THE PARTIES EXPRESSLY AGREE THAT LESSEE SHALL AT ALL TIMES WHILE THE
AIRCRAFT IS IN ITS POSSESSION DURING THE TERM MAINTAIN OPERATIONAL CONTROL OF THE AIRCRAFT,
AND THAT THE INTENT OF THE PARTIES IS THAT THIS AGREEMENT CONSTITUTE A “DRY” OPERATING LEASE.
Lessee shall exercise exclusive authority over initiating, conducting, or terminating any
flight conducted pursuant to this Agreement, and the Flight Crew shall be under the exclusive
command and control of Lessee in all phases of such flights.
	 
	5.7	 	Authority of Pilot in Command. Notwithstanding that Lessee shall have operational control of
the Aircraft during any flight conducted pursuant to this Agreement, Lessor and Lessee
expressly agree that the Pilot in Command member of the Flight Crew retained by Lessee,
pursuant to Section 5.3, in his or her sole discretion, may terminate any flight, refuse to
commence any flight, or take any other flight-related action which in the judgment of the
Pilot in Command is necessitated by considerations of safety. The





 









 






	 	 	Pilot in Command shall have final and complete authority to postpone or cancel any flight
for any reason or condition which in his or her judgment would compromise the safety of the
flight. No such action of the Pilot in Command shall create or support any liability for
loss, injury, damage or delay to Lessor.
	 
	5.8	 	Right to Inspect. Lessor and its agents shall have the right to inspect the Aircraft at any
reasonable time, upon giving Lessee reasonable notice, to ascertain the condition of the
Aircraft and to satisfy Lessor that the Aircraft is being properly repaired and maintained in
accordance with the requirements of this Agreement. All required repairs shall be performed as
soon as practicable after such inspection.
	 
	5.9	 	Modification of Aircraft. Lessee shall not make or permit to be made any modification or
alteration, improvement, or addition to the Aircraft without the express written consent of
Lessor.
	 
	5.10	 	Fines, Penalties and Forfeitures. Lessee shall be solely responsible for any fines, penalties
or forfeitures relating in any manner to the operation or use of the Aircraft by Lessee under
this Agreement.





SECTION 6. CONDITION DURING TERM AND RETURN OF AIRCRAFT





	6.1	 	Return. Upon completion of each use of the Aircraft by Lessee during the Term, Lessee shall
return the Aircraft to the Lessor by delivering the same to the Operating Base, fully equipped
with all Engines installed thereon. Upon each such delivery, the Aircraft shall be in as good
operating condition as at it was in when Lessor delivered the Aircraft to Lessee, ordinary
wear and tear excepted, and the United States standard airworthiness certificate issued for
the Aircraft shall be present on board the Aircraft and said standard airworthiness
certificate shall be effective in accordance with FAR 21.181(a)(1). Nothing contained in this
Section 6.1 may be interpreted to require Lessee to perform any maintenance or other
obligation which is the responsibility of the Lessor pursuant to Section 5.4 hereof; provided,
however, that Lessee shall be obligated to ensure that Lessor is advised of any maintenance
requirement, dangerous condition, malfunction or worn part that may be discovered during each
period during the Term commencing with the delivery of the Aircraft to Lessee and terminating
when the Aircraft has been redelivered to Lessor in the condition required hereunder.





SECTION 7. LIENS





	7.1	 	Lessee shall ensure that no Liens are created or placed against the Aircraft by Lessee or
third parties as a result of Lessee’s or its agents’ or representatives’ action or inaction.
Lessee shall notify Lessor promptly upon learning of any liens not permitted by these terms.
Lessee shall, at its own cost and expense, take all such actions as may be necessary to
discharge and satisfy in full any such lien promptly after the same becomes known to it.





 









 




SECTION 8. INSURANCE





	8.1	 	Liability. Lessor shall maintain, or cause to be maintained, bodily injury and property
damage, liability insurance in an amount no less than Two Hundred and Fifty Million United
States Dollars (USD$250,000,000.00) Combined Single Limit for the benefit of itself and Lessee
in connection with the use of the Aircraft. Said policy shall be an occurrence policy and
shall include Lessee as an operator and an Additional Named Insured.
	 
	8.2	 	Hull. Lessor shall maintain, or cause to be maintained, aircraft hull insurance in the amount
of Forty Four Million United States Dollars (US$44,000,000.00) which the parties agree
shall be deemed to be the full replacement value of the Aircraft, and such insurance shall
name Lessor and any first lien mortgage holder as loss payees as their interests may appear.
Said policy shall contain a waiver of subrogation clause in favor of all Additional Named
Insureds.
	 
	8.3	 	Insurance Certificates. Lessor will provide Lessee with a Certificate of Insurance upon
execution of this Agreement and thereafter reasonably upon request therefor.
	 
	8.4	 	Conditions of Insurance. Each insurance policy required hereunder shall insure the interest
of Lessee regardless of any breach or violation by Lessor of any warranties, declarations, or
conditions contained in such policies. Each such policy shall be primary without any right of
contribution from any insurance maintained by Lessee. The geographic limits, if any, contained
in each and every such policy of insurance shall include at the minimum all territories over
which Lessee will operate the Aircraft for which the insurance is placed. Each policy shall
contain an agreement by the insurer that notwithstanding the lapse of any such policy for any
reason or any right of cancellation by the insurer or Lessor, whether voluntary or
involuntary, such policy shall continue in force for the benefit of Lessee for at least thirty
(30) days (or such lesser time as may be permitted in the case of War Risk Insurance, if such
War Risk Insurance so requires) after written notice of such lapse or cancellation shall have
been given to Lessee. Each policy shall contain an agreement by the Insurer to provide Lessee
with thirty (30) days’ advance written notice of any deletion, cancellation, or material
change in coverage.
	 
	8.5	 	Insurance Companies. Each insurance policy required hereunder shall be issued by a company or
companies who are qualified to do business in the United States and who (i) will submit to the
jurisdiction of any competent state or federal court in the United States with regard to any
dispute arising out of the policy of insurance or concerning the parties herein; and (ii) will
respond to any claim or judgment against Lessee in any competent state or federal court in the
United States or its territories.





SECTION 9. DEFAULTS AND REMEDIES





	9.1	 	Upon the occurrence of any failure by a party hereto duly to observe or perform any of its
obligations hereunder, and at any time thereafter so long as the same shall be continuing, the
other party may, at its option, declare in writing that this Agreement is in default; and at
any time thereafter, so long as the outstanding default shall not have been remedied,





 









 






	 	 	the non-defaulting party may cancel, terminate, or rescind
this Agreement and may exercise any and all remedies available
to it at law or in equity.





SECTION 10. NOTICES





	10.1	 	All communications, declarations, demands, consents, directions, approvals, instructions,
requests and notices required or permitted by this Agreement shall be in writing and shall be
deemed to have been duly given or made when delivered by hand or on the next Business Day when
sent by overnight courier or when transmitted by means of facsimile or e-mail (with request
for assurance of receipt in a manner typical with respect to communications of that type and
followed promptly with the original thereof and a copy sent simultaneously therewith by first
class mail, postage prepaid) in each case at the address set forth below:





	 	 	 	 	 

	 

	 	If to Lessor:
	 	Falstaff Partners LLC

c/o Stewart Management Company

1410 Nemours Building

1007 Orange Street

Wilmington, Delaware 19801
	 
	 	 	 	 
	 

	 	If to Lessee:
	 	Carlyle Investment Management L.L.C.

1001 Pennsylvania Ave. NW

Suite 220

Washington, DC 20004

Attn: Jeffrey Ferguson






SECTION 11. EVENT OF LOSS AND INDEMNIFICATION





	11.1	 	Notification of Event of Loss. In the event any damage to or destruction of the Aircraft
shall occur, while the Aircraft is in the possession of Lessee, or in the event of any whole
or partial loss of the Aircraft during such time, including, without limitation, any loss
resulting from the theft, condemnation, confiscation or seizure of, or requisition of title to
or use of, the Aircraft by private persons or by any governmental or purported governmental
authority, Lessee shall immediately:






	 	11.1.1	 	report the event of loss to Lessor, the insurance company or companies, and to any and all
applicable governmental agencies; and
	 
	 	11.1.2	 	furnish such information and execute such documents as may be required and necessary to
collect the proceeds from any insurance policies.






	11.2	 	Repair or Termination. In the event the Aircraft is partially destroyed or damaged, Lessor
shall have the option, in its sole discretion, to either (i) fully repair the Aircraft in
order that it shall be placed in at least as good condition as it was prior to such partial
destruction or damage; or (ii) terminate this Agreement. Within five (5) days after the date
of such partial destruction or damage, Lessor shall give written notice to Lessee specifying
whether Lessor has elected fully to repair the Aircraft and, if so, the expected





 









 






	 	 	date the Aircraft will be fully repaired and available for Lessee’s use in accordance with
this Agreement, or to terminate this Agreement, which termination shall be effective
immediately upon such written notice from Lessor to Lessee setting forth Lessor’s election
to so terminate this Agreement.
	 
	11.3	 	Indemnification. Lessee hereby releases, and shall defend, indemnify and hold harmless Lessor
and its shareholders, members, directors, officers, managers, employees, successors and
assigns, from and against, any and all claims, damages, losses, liabilities, demands, suits,
judgments, causes of action, civil and criminal legal proceedings, penalties, fines, and other
sanctions, and any attorneys’ fees and other reasonable costs and expenses, directly or
indirectly arising from the use of the Aircraft by Lessee to the extent of available
insurance.





SECTION 12. MISCELLANEOUS





	12.1	 	Entire Agreement. This Agreement, and all terms, conditions, warranties, and representations
herein, are for the sole and exclusive benefit of the signatories hereto. This Agreement
constitutes the entire agreement of the parties as of its Effective Date and supersedes all
prior or independent, oral or written agreements, understandings, statements, representations,
commitments, promises, and warranties made with respect to the subject matter of this
Agreement.
	 
	12.2	 	Other Transactions. Except as specifically provided in this Agreement, none of the provisions
of this Agreement, nor any oral or written statements, representations, commitments, promises,
or warranties made with respect to the subject matter of this Agreement shall be construed or
relied upon by any party as the basis of, consideration for, or inducement to engage in, any
separate agreement, transaction or commitment for any purpose whatsoever.
	 
	12.3	 	Prohibited and Unenforceable Provisions. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibitions or unenforceability in any jurisdiction. To the extent
permitted by applicable law, each of Lessor and Lessee hereby waives any provision of
applicable law which renders any provision hereof prohibited or unenforceable in any respect.
	 
	12.4	 	Enforcement. This Agreement, including all agreements, covenants, representations and
warranties, shall be binding upon and inure to the benefit of, and may be enforced by Lessor,
Lessee, and each of their agents, servants and personal representatives.
	 
	12.5	 	Headings. The section and subsection headings in this Agreement are for convenience of
reference only and shall not modify, define, expand, or limit any of the terms or provisions
hereof.
	 
	12.6	 	Counterparts. This Agreement may be executed by the parties hereto in separate counterparts,
each of which when so executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same instrument.





 









 






	12.7	 	Amendments. No term or provision of this Agreement may be amended, changed, waived,
discharged, or terminated orally, but only by an instrument in writing signed by the party
against which the enforcement of the change, waiver, discharge, or termination is sought.
	 
	12.8	 	No Waiver. No delay or omission in the exercise or enforcement or any right or remedy
hereunder by either party shall be construed as a waiver of such right or remedy. All
remedies, rights, undertakings, obligations, and agreements contained herein shall be
cumulative and not mutually exclusive, and in addition to all other rights and remedies which
either party possesses at law or in equity.
	 
	12.9	 	No Assignments. Neither party may assign its rights or obligations under this Agreement
without the prior written permission of the other.
	 
	12.10	 	Governing Law. This Agreement has been negotiated and delivered in the District of Columbia
and shall in all respects be governed by, and construed in accordance with, the laws of the
District of Columbia, including all matters of construction, validity and performance, without
giving effect to its conflict of laws provisions.
	 
	12.11	 	Jurisdiction and Venue. Each party hereby consents to the nonexclusive jurisdiction and
venue of the state and federal courts serving the District of Columbia. Nothing in this
Agreement shall, however, prohibit any party from seeking enforcement of this Agreement in any
appropriate court and in any jurisdiction where the patty against whom enforcement is sought
is subject to personal jurisdiction and where venue is proper.





[Remainder of Page Intentionally Left Blank]




 









 





SECTION 13. TRUTH IN LEASING





	13.1	 	TRUTH IN LEASING STATEMENT UNDER SECTION 91.23 OF THE FARs.




WITHIN THE TWELVE (12) MONTH PERIOD PRECEDING THE DATE OF THIS AGREEMENT, EXCEPT TO THE EXTENT THE
AIRCRAFT IS LESS THAN TWELVE (12) MONTHS OLD, THE AIRCRAFT HAS BEEN INSPECTED AND MAINTAINED AND IN
ACCORDANCE WITH THE FOLLOWING PROVISIONS OF FAR:



CHECK ONE:




	 	 	 

	o

	 	91.409 (f) (1): A continuous airworthiness inspection program that is part of a continuous airworthiness maintenance
program currently in use by a person holding an air carrier operating certificate or an operating certificate issued
under FAR Part 121, 127, or 135 and operating that make and model aircraft under FAR Part 121 or operating that make and
model under FAR Part 135 and maintaining it under FAR 135.411(a)(2).
	 
	 	 
	o

	 	91.409 (f) (2): An approved aircraft inspection program approved under FAR 135.419 and currently in use by a person
holding an operating certificate issued under FAR Part 135.
	 
	 	 
	þ

	 	91.409 (f) (3): A current inspection program recommended by the manufacturer.
	 
	 	 
	o

	 	91.409 (f) (4): Any other inspection program established by the registered owner or operator of the Aircraft and approved
by the Administrator of the Federal Aviation Administration in accordance with FAR 91.409 (g).





THE PARTIES HERETO CERTIFY THAT DURING THE TERM OF THIS AGREEMENT AND FOR OPERATIONS CONDUCTED
HEREUNDER, THE AIRCRAFT WILL BE MAINTAINED AND INSPECTED IN ACCORDANCE WITH THE PROVISIONS OF FAR:



CHECK ONE:




	 	 	 	 	 	 	 

	o 91.409 (f) (1)

	 	o 91.409 (f) (2)
	 	þ 91.409 (f) (3)
	 	o 91.409 (f) (4)





LESSEE ACKNOWLEDGES THAT WHEN IT OPERATES THE AIRCRAFT UNDER THIS AGREEMENT, IT SHALL BE KNOWN AS,
CONSIDERED, AND IN FACT WILL BE THE LESSEE OF SUCH AIRCRAFT. EACH PARTY HERETO CERTIFIES THAT IT
UNDERSTANDS THE EXTENT OF ITS RESPONSIBILITIES, SET FORTH HEREIN, FOR COMPLIANCE WITH APPLICABLE
FEDERAL AVIATION REGULATIONS.



AN EXPLANATION OF FACTORS BEARING ON OPERATIONAL CONTROL AND PERTINENT FEDERAL AVIATION REGULATIONS
CAN BE OBTAINED FROM THE NEAREST FEDERAL AVIATION ADMINISTRATION FLIGHT STANDARDS DISTRICT OFFICE,
GENERAL AVIATION DISTRICT OFFICE, OR AIR CARRIER DISTRICT OFFICE. THE PARTIES HERETO CERTIFY THAT A
TRUE COPY OF THIS AGREEMENT SHALL BE CARRIED ON THE AIRCRAFT AT ALL TIMES, AND SHALL BE MADE
AVAILABLE FOR INSPECTION UPON REQUEST By AN APPROPRIATELY




 









 




CONSTITUTED IDENTIFIED REPRESENTATIVE OP THE ADMINISTRATOR OF THE FAA.




*     *     *




          IN WITNESS WHEREOF, the Lessor and the Lessee have each caused this Non-Exclusive Aircraft
Lease Agreement to be duly executed as of the Effective Date.




	 	 	 	 	 	 	 

	 	 	LESSOR:	 	 
	 
	 	 	 	 	 	 
	 	 	Falstaff Partners LLC
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ C. Anthony Shippan	 	 
	 

	 	 	 	 	 	 
	 	 	Print: C. Anthony Shippan	 	 
	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	LESSEE:	 	 
	 
	 	 	 	 	 	 
	 	 	Carlyle Investment Management L.L.C.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Print:	 	 
	 	 	Title:	 	 






 









 




CONSTITUTED IDENTIFIED REPRESENTATIVE OP THE ADMINISTRATOR OF THE FAA.




*     *     *




          IN WITNESS WHEREOF, the Lessor and the Lessee have each caused this Non-Exclusive Aircraft
Lease Agreement to be duly executed as of the Effective Date.




	 	 	 	 	 	 	 

	 	 	LESSOR:	 	 
	 
	 	 	 	 	 	 
	 	 	Falstaff Partners LLC
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Print: C. Anthony Shippan	 	 
	 	 	Title: Manager	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	LESSEE:	 	 
	 
	 	 	 	 	 	 
	 	 	Carlyle Investment Management L.L.C.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jeffrey W. Ferguson	 	 
	 

	 	 	 	 	 	 
	 	 	Print: Jeffrey W. Ferguson	 	 
	 	 	Title: Managing Director