**EXHIBIT 4.44**

 

**LOAN AND SECURITY AGREEMENT**

(aircraft)

Loan Number: 1000122039

 

This Agreement is dated as ofMarch 24, 2005 and is executed by and between CHASE EQUIPMENT LEASING INC. (“Lender”),with Lender’s principal office located at 1111 Polaris Parkway, Suite A3(OH1-1085), Columbus, Ohio 43240 and the borrower identified below (“Borrower”):

 

Borrower:  AIRNET SYSTEMS, INC.

 

**Borrower’s Address:**  **3939 International Gtwy.,Columbus, Ohio 43219**

 

**1.  GRANT OF SECURITY INTEREST.** Borrower grants, pledges and assigns to Lender a security interest inall of Borrower’s respective right, title and interest in and to the propertydescribed on the **attached Schedule A-1**,now or hereafter arising or acquired, wherever located, together with any andall additions, accessions, parts, accessories, substitutions and replacementsthereof, now or hereafter installed in, affixed to or used in connection withsaid property (the “Equipment”), in all proceeds thereof, cash and non-cash,including, but not limited to, proceeds of notes, checks, instruments,indemnity proceeds, or any insurance on such and any refund or rebate ofpremiums on such (“Collateral”).  ThisAgreement secures the prompt payment and complete performance in full when due,whether at the stated maturity, by acceleration or otherwise, of all paymentand other obligations of Borrower under or in connection with this Agreement,and the Business Purpose Promissory Note executed in connection with the LoanNumber referenced above with the Borrower as the maker (the “Note”), and anyand all renewals, extensions or substitutions therefor (“Obligations”).  Borrower is and will continue to be (or, withrespect to after acquired property that constitutes Equipment under thisAgreement, will be when acquired) the legal and beneficial owner of theCollateral free and clear of any Lien except for the security interest createdby this Agreement and/or any other prior security agreement delivered byBorrower to Lender.  Except as previouslydisclosed to Lender in writing, no effective Uniform Commercial Code (“UCC”)financing statement or other instrument covering all or any part of theCollateral is on file in any recording office, except those in favor ofLender.  At its sole expense, Borrowershall protect and defend Lender’s first priority security interest in theCollateral against all claims and demands whatsoever.

 

**2.**  **MAINTENANCE AND USE**. At its sole expense, Borrower shall (a) repair and maintain theEquipment in good condition and working order and supply and install allreplacement parts or other devices when required to so maintain the Equipmentor when required by applicable law or regulation, which parts or devices shallautomatically become part of the Equipment; (b) use and operate the Equipmentin a careful manner in the normal course of its business and only for thepurposes for which it was designed in accordance with the manufacturer’swarranty requirements, and comply with all laws and regulations relating to theEquipment, and obtain all permits or licenses necessary to install, use oroperate the Equipment;  (c) except asprovided in clause (d) below, make no alterations, additions, subtractions,upgrades or improvements to the Equipment without Lender’s prior writtenconsent, which consent will not be unreasonably withheld, but any suchalterations, additions, upgrades or improvements shall automatically becomepart of the Equipment; (d) maintain, inspect, service and repair, overhaul andtest the Equipment in accordance with the FAA approved maintenance program,manufacturer’s approved maintenance program, FAA airworthiness directives, andthe manufacturer’s alert bulletins and urgently recommended service bulletinsand procedures, and perform all duties and tasks which would be required tomaintain the Equipment, including the engines, in full compliance with themanufacturer’s specification (i) so as to keep the Equipment in as goodoperating condition as when delivered to the Borrower hereunder, ordinary wearand tear excepted, and (ii) so as to keep the Equipment in such operatingcondition as may be necessary to enable the airworthiness certification of suchEquipment to be maintained in good standing at all times under the Act (asdefined in Section 20 hereof); and (e) maintain all records, logs and othermaterials required by the FAA to be maintained in respect of the Equipment. TheEquipment will not be based outside of the United States, provided, however,that each aircraft that is the Equipment shall not be used outside of theUnited States for more than ninety (90) days in any calendar year.  Each aircraft that is the Equipment may beused in Canada within the ninety (90) day limit.  The Equipment shall not be operated within,over or into any jurisdiction not covered by the insurance policies requiredherein nor shall the Equipment be operated in any jurisdiction that does nothave diplomatic relations with the United States.  Lender has the right upon reasonable noticeto Borrower to inspect the Equipment wherever located.  The Equipment shall be based at the locationspecified on Schedule A-1.  The Equipmentmay be repositioned by Borrower, from time to time, to other locations withinthe United States in the normal course of the Borrower’s business.  Borrower shall notify Lender in writing of anynew location where the Equipment is based within five (5) days of anyrepositioning of the Equipment.

 

**3.  INSURANCE.**  At itssole expense, Borrower at all times shall keep each item of Equipment insuredagainst all risks of loss or damage from every cause whatsoever for an amountnot less than the greater of the full replacement value or the Financed Amount(as defined in Section 20 hereof).  Allinsurers shall be reasonably satisfactory to Lender.  Borrower shall deliver to Lender satisfactoryevidence of such coverage.  Proceeds ofany insurance covering damage or loss of the 

 

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Equipment in excess of $250,000.00 shall bepayable to Lender as loss payee and shall, at Lender’s option, be appliedtoward (a) the replacement, restoration or repair of the Equipment, or (b)payment of the obligations of Borrower under this Agreement.  If an event of default occurs and iscontinuing, then Borrower automatically appoints Lender as Borrower’sattorney-in-fact with full power and authority in the place of Borrower and inthe name of Borrower or Lender to make claim for, receive payment of, and signand endorse all documents, checks or drafts for loss or damage under any suchpolicy.  Each insurance policy willrequire that the insurer give Lender at least 30 days prior written notice ofany cancellation of such policy and will require that Lender’s interests remaininsured regardless of any act, error, omission, neglect or misrepresentation ofBorrower, and will contain those other requirements outlined in Schedule 3hereof.  The insurance maintained byBorrower shall be primary without any right of contribution from insurancewhich may be maintained by Lender.

 

**4.  LOSS OR DAMAGE.** Borrower bears the entire risk of loss, theft, damage or destruction ofEquipment in whole or in part from any reason whatsoever (“Casualty Loss”).  No Casualty Loss to Equipment shall relieveBorrower from the obligation to pay the installment payments or from any otherobligation under this Agreement.  In theevent of Casualty Loss to any item of Equipment, Borrower shall immediatelynotify Lender of the same and Borrower shall, if so directed by Lender,immediately repair the same.  If Lenderdetermines that any item of Equipment has suffered a Casualty Loss beyondrepair (“Lost Equipment”), then Borrower, at the option of Lender, shall:  (1) upon receipt of any insurance proceedsfor the Lost Equipment replace the Lost Equipment with similar equipment ingood repair, condition and working order free and clear of any Liens anddeliver to Lender a bill of sale covering the replacement equipment, in whichevent such replacement equipment shall automatically be Equipment under thisAgreement; or (2) upon receipt of any insurance proceeds for the Lost Equipment  but no more than 120 days after the date ofthe Casualty Loss, pay to Lender all amounts then due and payable by Borrowerunder this Agreement for the Lost Equipment plus the remaining principalbalance for such Lost Equipment as of the date of the Casualty Loss asdetermined by Lender’s records.  Uponpayment by Borrower of all amounts due under the above clause (2), the securityinterest of the Lender in the Lost Equipment will terminate.

 

**5.  TAXES.** Borrower will pay promptly when due all taxes, assessments andgovernmental charges upon or against Borrower, the Collateral or the propertyor operations of Borrower, in each case before same becomes delinquent andbefore penalties accrue thereon, unless and to the extent that same are beingcontested in good faith by appropriate proceedings.

 

**6.  GENERAL INDEMNITY.** Borrower assumes all risk and liability for, and shall defend, indemnifyand keep Lender harmless on an after-tax basis from, any and all liabilities,obligations, losses, damages, penalties, claims, actions, suits, costs andexpenses, including reasonable attorney fees and expenses, of whatsoever kindand nature imposed on, incurred by or asserted against Lender, in any wayrelating to or arising out of the manufacture, purchase, acceptance, rejection,ownership, possession, use, selection, delivery,  operation, condition, sale, return or otherdisposition of the Equipment or any part thereof (including, withoutlimitation, any claim for latent or other defects, whether or not discoverableby Borrower or any other person, any claim for negligence, tort or strictliability, any claim under any environmental protection or hazardous waste lawand any claim for patent, trademark or copyright infringement).  Borrower will not indemnify Lender under thissection for loss or liability caused directly and solely by the negligence orwillful misconduct of Lender.  In thissection, “Lender” also includes any director, officer, employee, agent,successor or assign of Lender.  Borrower’sobligations under this section shall survive the expiration, cancellation ortermination of this Agreement.

 

**7.  PERSONAL PROPERTY.** Borrower represents and agrees that the Equipment is, and shall at alltimes remain, separately identifiable personal property.  Upon Lender’s request, Borrower shall usecommercially reasonable efforts to furnish Lender a landlord’s and/or mortgagee’swaiver and consent to remove all Equipment. Lender may display notice of itsinterest in the Equipment by any reasonable identification.  Borrower shall not alter or deface any suchindicia of Lender’s interest.

 

**8.  FINANCIAL REPORTS.** Borrower agrees to furnish to Lender: (a) audited annual financial statements setting forth the financialcondition and results of operation of Borrower (financial statements shallinclude balance sheet, income statement and changes in financial position andall notes thereto) within 120 days of the end of each fiscal year of Borrower;(b) quarterly financial statements setting forth the financial condition andresults of operation of Borrower within 60 days of the end of each of the firstthree fiscal quarters of Borrower; and (c) such other financial information asLender may from time to time reasonably request including, without limitation,financial reports filed by Borrower with federal or state regulatory agenciesto the extent Borrower may disclose such other financial information withoutviolating the Securities Exchange Act of 1934 or any rule or regulation of theSecurities and Exchange Commission.  Allsuch financial information shall be prepared in accordance with generallyaccepted accounting principles.  IfBorrower fails to furnish the annual financial statements to Lender within 30days of Lender’s written request, then Lender may, at its option, chargeBorrower a non-performance fee equal to all the installment payments due underthis Agreement for the then current month (unless otherwise prohibited by law)and such fees shall be payable by Borrower on demand.

 

**9.  NO CHANGES IN BORROWER**. Borrower shall not:  (a)liquidate, dissolve or suspend business; (b) sell, transfer or otherwisedispose of all or a majority of its assets, except that Borrower may sell itsinventory in the ordinary 

 

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course of its business; (c) enter into anymerger, consolidation or similar reorganization unless it is the survivingcorporation; (d) transfer all, or any substantial part of, its operations orassets outside of the United States of America; or (e) without 15 days advancewritten notice to Lender, change its name, state of incorporation or chief placeof business.

 

**10.  REPRESENTATIONS.** Borrower represents and warrants that: (a) Borrower is organized, validly existing, and in good standing underthe laws of one of the states of the United States; (b) Borrower is qualifiedto do business in, and is in good standing under the laws of, each other statein which it conducts its business and in which the Equipment is located, exceptto the extent such failure would not have a material adverse effect on theBorrower’s business or the Collateral; (c) Borrower has the power, and is dulyauthorized to enter into, this Agreement and the Note and to execute anddeliver to Lender, now and from time to time hereafter, additional instruments,resolutions, agreements and other instruments or documents relating to theObligation owed to Lender; (d) Borrower has, by proper action, authorized andempowered those persons whose signatures appear in this Agreement, the Note,and any instruments, documents and exhibits that have been delivered inconnection herewith, to execute the same for and on its behalf; (e)  this Agreement, the Note, and each relateddocument constitute a legal, valid, and binding obligation of Borrowerenforceable in accordance with its terms, except as enforceability may belimited by bankruptcy, insolvency or similar laws affecting the enforcement ofcreditors’ rights generally and general principles of equity; (f) thisAgreement and the Note evidence a loan made primarily for business, commercialor agricultural purposes and not primarily for personal, family, or householdpurposes; (g) the Equipment is not, and will not, be registered under the lawsof any foreign country; (h) the Equipment is, and shall remain at all times,eligible for registration under the Act (as defined in Section 20 hereof); (i)the Equipment shall be based in, and primarily used in, the United States allas required by  the Act; and (j) theEquipment will not be used in violation of any law, regulation, ordinance orpolicy of insurance affecting the maintenance, use or flight of the Equipment;and (k) Borrower qualifies as a citizen of the United States as defined in theAct and will continue to qualify as a United States citizen in all respects.

 

**11.  OTHER DOCUMENTS; EXPENSES; APPOINTMENT OFATTORNEY-IN-FACT**.  Borrower hereby irrevocably appoints Lenderor its designee as Borrower’s attorney in fact, with full authority in theplace instead of Borrower, from time to time in Lender’s discretion upon,during, and after an event of default, to take any action and to execute anyinstrument which Lender may deem necessary or advisable to accomplish thepurposes of this Agreement, including without limitation, (a) to perfect andcontinue to perfect the security interests created by this Agreement, includingwithout limitation to prepare, sign, amend, file, or record a UniformCommercial Code financing statement in the place of Borrower and in the name ofBorrower; (b) to ask, demand, collect or sue for, recover, compound, receiveand give acquittance in receipts for any monies due or become due under or inrespect for any Collateral; (c) to receive, endorse and collect any drafts orother instruments, documents and chattel paper, in connection with theCollateral; and (d) to file any claims or take any action or institute any proceedingwhich Lender may deem necessary or desirable for the collection of anyCollateral or otherwise to enforce the rights of Lender in the Collateral.  Borrower agrees to sign and deliver to Lenderany additional documents deemed desirable by Lender to effect the perfection ofLender’s security interest in the Collateral. Borrower shall pay upon Lender’s request any out-of-pocket costs andexpense paid or incurred by Lender in connection with the above terms of thisAgreement or the funding and closing of this Agreement.

 

**12.**** EVENTS OF DEFAULT.** Each of the following events shall constitutean event of default under this Agreement and the Note:  (a) Borrower fails to pay any installmentpayment or other amount due under this Agreement or the Note within ten days ofits due date; or (b) Borrower fails to perform or observe any of itsobligations in Sections 3, 9, or 18 hereof; or (c) Borrower fails to perform orobserve any of its other obligations in this Agreement or the Note within 30days after Lender notifies Borrower of such failure; or (d) Borrower or anyBorrower affiliate defaults in the payment, performance or observance of anyobligation under any other loan, credit agreement or lease in which Lender orany subsidiary (direct or indirect) of JPMorgan Chase & Co.(or itssuccessors or assigns) is the lender, creditor or lessor (each an “AffiliateCredit Agreement”) which shall not be remedied within the period of time (ifany) within which such Affiliate Credit Agreement permits such default to be remedied;or (e) any statement, representation or warranty made by Borrower in thisAgreement or in any document, certificate or financial statement in connectionwith this Agreement proves at any time to have been untrue or misleading in anymaterial respect as of the time when made; or (f) Borrower becomes insolvent orbankrupt, or Borrower admits its inability to pay its debts as they mature, orBorrower makes an assignment for the benefit of creditors, or Borrower appliesfor, institutes or consents to the appointment of a receiver, trustee orsimilar official for Borrower or any substantial part of its property or anysuch official is appointed without Borrower’s consent, or Borrower applies for,institutes or consents to any bankruptcy, insolvency, reorganization, debtmoratorium, liquidation or similar proceeding relating to Borrower or anysubstantial part of its property under the laws of any jurisdiction or any suchproceeding is instituted against Borrower without stay or dismissal for morethan 60 days, or Borrower commences a winding up of its affairs, or Borrowerceases to do business as a going concern; or (g) with respect to any guaranty,letter of credit, pledge agreement, security agreement, mortgage, deed oftrust, debt subordination agreement or other credit enhancement or creditsupport agreement (whether now existing or hereafter arising) signed or issuedby any party in connection with all or any part of Borrower’s obligations underthis Agreement, the party signing or issuing any such agreement defaults in itsobligations thereunder or any such agreement shall cease to be in full forceand effect or shall be declared to be null, void, invalid or unenforceable bythe party signing or issuing it; or (h) Borrower fails to maintain a current MSPor JSSI program on each of the Lear 35A aircraft that is part of the Equipment.

 

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As used in this section 12,the term “Borrower” also includes any guarantor (whether now existing orhereafter arising) of all or any part of Borrower’s obligations under thisAgreement and/or any issuer of a letter of credit (whether now existing orhereafter arising) relating to all or any part of Borrower’s obligations underthis Agreement, and the term “Agreement” also includes any guaranty or letterof credit (whether now existing or hereafter arising) relating to all or anypart of Borrower’s obligations under this Agreement.

 

**13.**** RIGHTS UPON DEFAULT.**  If any event of default exists, Lender mayexercise in any order one or more of the remedies described in the letteredsubparagraphs of this section, and Borrower shall perform its obligationsimposed thereby:

 

(a)  Lender may require Borrower to turnover anyand all Collateral to Lender.

 

(b)  Lender or its agent may repossess any or allCollateral wherever found, may enter the premises where the Collateral islocated and disconnect, render unusable and remove it, and may use suchpremises without charge to store or show the Collateral for sale.

 

(c)  Lender may sell any or all Collateral atpublic or private sale, with or without advertisement or publication, may leaseor otherwise dispose of it or may use, hold or keep it.

 

(d)  Lender may require Borrower to pay to Lenderon a date specified by Lender,  (i) allaccrued and unpaid interest, late charges and other amounts due under the Noteor this Agreement as of such date, plus (ii) the remaining principal balance ofthe Note as of such date, plus (iii) interest at the Overdue Rate on the totalof the foregoing (“Overdue Rate” means an interest rate per annum equal to thehigher of 12% or 2% over the Prime Rate, but not to exceed the highest ratepermitted by applicable law).  If anevent of default under section 12(f) of this Agreement exists, then Borrowerwill be automatically liable to pay Lender the foregoing amounts as of the nextinstallment payment date under the Note unless Lender otherwise elects inwriting.

 

(e)  Borrower shall pay all reasonable costs,expenses and damages incurred by Lender because of the event of default or itsactions under this section, including, without limitation any collection agencyand/or attorney fees and expenses, any costs related to the repossession,safekeeping, storage, repair, reconditioning or disposition of the Collateral.

 

(f)  Lender may sue to enforce Borrower’sperformance of its obligations under the Note and this Agreement and/or mayexercise any other right or remedy then available to Lender at law or inequity.

 

Lender is not required totake any legal process or give Borrower any notice before exercising any of theabove remedies.  If Lender is required togive notice, 10 calendar days advanced notice is reasonable notification.  None of the above remedies is exclusive, buteach is cumulative and in addition to any other remedy available toLender.  Lender’s exercise of one or moreremedies shall not preclude its exercise of any other remedy.  No action taken by Lender shall releaseBorrower from any of its obligations to Lender. No delay or failure on the part of Lender to exercise any righthereunder shall operate as a waiver thereof nor as an acquiescence in anydefault, nor shall any single or partial exercise of any right preclude anyother exercise thereof or the exercise of any other right.  After any default, Lender’s acceptance of anypayment by Borrower under the Note or this Agreement shall not constitute awaiver by Lender of such default, regardless of Lender’s knowledge or lack ofknowledge at the time of such payment, and shall not constitute a reinstatementof the Note or this Agreement if this Agreement has been declared in default byLender, unless Lender has agreed in writing to reinstate this Agreement and towaive the default. With respect to any Collateral or any Obligation, Borrowerassents to all extensions or postponements to the time of payment thereof orany other indulgence in connection therewith, to each substitution, exchange orrelease of Collateral, to the release of any party primarily or secondarilyliable, to the acceptance of partial payment thereof or to the settlement orcompromise thereof, all in such matter and such time or times as Lender maydeem advisable.

 

If Lender actuallyrepossesses any Collateral, then it will use commercially reasonable effortsunder the then current circumstances to attempt to mitigate its damages; provided,that Lender shall not be required to sell, lease or otherwise dispose of anyCollateral prior to Lender enforcing any of the remedies described above.  Lender may sell or lease the Collateral inany manner it chooses, free and clear of any claims or rights of Borrower andwithout any duty to account to Borrower with respect thereto except as providedbelow.  If Lender actually sells orleases the Collateral, it will credit the net proceeds of any sale of the Collateral,or the net present value (discounted at the then current Prime Rate) of therents payable under any new lease of the Collateral, against the amountsBorrower owes Lender.  The term “net” asused above shall mean such amount after deducting the costs and expensesdescribed in clause (e) above of this section. Borrower shall remain liable forany deficiency if the net proceeds are insufficient to pay all amounts to whichLender is entitled hereunder.

 

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**14.**  **LATE CHARGES.**  If anyinstallment payment or other amount payable under the Note or this Agreement isnot paid when due, then as compensation for the administration and enforcementof Borrower’s obligation to make timely payments, Borrower shall pay withrespect to each overdue payment on demand an amount equal to the greater offifteen dollars ($15.00) or five percent (5%) of the each overdue payment (butnot to exceed the highest late charge permitted by applicable law) plus anycollection agency fees and expenses**.**

 

**15.  LENDER’S RIGHT TO PERFORM**.  IfBorrower fails to make any payment under this Agreement or fails to perform anyof its other obligations in this Agreement (including, without limitation, itsagreement to provide insurance coverage), Lender may itself make such paymentor perform such obligation, and the amount of such payment and the amount ofthe expenses of Lender incurred in connection with such payment or performanceshall be deemed to be additional principal under the Note which is payable byBorrower on demand.

 

**16.**** NOTICES; POWER OF ATTORNEY.**  (a) Service of all notices under thisAgreement shall be sufficient if given personally or couriered or mailed to theparty involved at its respective address set forth herein or at such otheraddress as such party may provide in writing from time to time.  Any such notice mailed to such address shallbe effective three days after deposit in the United States mail with postageprepaid.  (b) With respect to any powerof attorney covered by this Agreement, the powers conferred on Lender thereby:  are powers coupled with an interest; areirrevocable; are solely to protect Lender’s interests under this Agreement; anddo not impose any duty on Lender to exercise such powers.  Lender shall be accountable solely foramounts it actually receives as a result of its exercise of such powers.

 

**17.**  **ASSIGNMENTBY LENDER.**  Lender and anyassignee of Lender, may, upon prior written notice to Borrower, with or withoutconsent of Borrower, sell, assign, transfer or grant a security interest in allor any part of Lender’s rights, obligations, title or interest in theCollateral, the Note, this Agreement, or the amounts payable under the Note orthis Agreement to any entity (“transferee”). The transferee shall succeed to all of Lender’s rights in respect tothis Agreement (including, without limitation, all rights to insurance andindemnity protection described in this Agreement).  Borrower agrees to sign any acknowledgmentand other documents reasonably requested by Lender or the transferee inconnection with any such transfer transaction. Borrower, upon receiving notice of any such transfer transaction, shallcomply with the terms and conditions thereof. Borrower agrees that it shall not assert against any transferee anyclaim, defense, setoff, deduction or counterclaim which Borrower may now or hereafterbe entitled to assert against Lender.

 

**18.  NO ASSIGNMENT OR LEASING BY BORROWER. **BORROWER SHALL NOT, DIRECTLY OR INDIRECTLY, (a) MORTGAGE, ASSIGN, SELL,TRANSFER, OR OTHERWISE DISPOSE OF INTEREST IN THIS AGREEMENT OR THE COLLATERALOR ANY PART THEREOF, OR (b) LEASE, RENT, LEND OR TRANSFER POSSESSION OR USE(OTHER THAN USE IN THE ORDINARY COURSE OF BORROWER’S BUSINESS) OF THE EQUIPMENTOR ANY PART THEREOF TO ANY PARTY, OR (c) CREATE, INCUR, GRANT, ASSUME OR ALLOWTO EXIST ANY LIEN ON ITS INTEREST IN THIS AGREEMENT, THE COLLATERAL OR ANY PARTTHEREOF.

 

                **19.**  **TERMINATION**. This Agreement shall continuein effect until the Obligations have been indefeasibly paid and performed infull.  Upon termination of thisAgreement, Lender shall, at Borrower’s expense, take such actions and file suchdocuments, as may be necessary or desirable to release the Collateral from thisAgreement.

 

**20.  CERTAIN DEFINITIONS. **“Act” means subtitle VII of Title 49 of the United States Code. “FinancedAmount” for any item of Equipment shall mean the amount set forth on theSchedule A-1 that corresponds to that item of Equipment.  “Lien” means any security interest, lien,mortgage, pledge, encumbrance, judgment, execution, attachment, warrant, writ,levy, other judicial process or claim of any nature whatsoever by or of anyperson.  “Prime Rate” means the primerate of interest announced from time to time as the prime rate by JPMorganChase Bank, N.A. (or its successors or assigns); provided, that the partiesacknowledge that the Prime Rate is not intended to be the lowest rate ofinterest charged by said bank in connection with extensions of credit.  All terms defined herein are equallyapplicable to both the singular and plural form of such terms.

 

**21.  CONDITIONS. **Lender is notobligated to make any loan or disburse any principal hereunder unless: (a)  Lender has received the Note signed by theBorrower; (b) Lender has received evidence of all required insurance; (c) inLender’s sole judgment, there has been no material adverse change in thefinancial condition or business of Borrower or any guarantor; (d) Borrower hassigned and delivered to Lender this Agreement and Lender has signed andaccepted this Agreement; (e) Lender has received the documents and instrumentsand evidence as to satisfaction of the matters specified in any **Schedule 2** which may be attachedhereto, each of which shall be satisfactory to Lender in form and substance andeach document or instrument to be duly authorized, executed and delivered andin full force and effect;  (f) Lender hasreceived, in form and substance satisfactory to Lender, such other documentsand information as Lender shall reasonably request; and (g)  Borrower has satisfied all other reasonableconditions established by Lender.

 

**22.  USURY.**  It isnot the intention of the parties to this Agreement to make an agreementviolative of the laws of any applicable jurisdiction relating to usury (“UsuryLaws”).  Regardless of any provision inthis Agreement, the Note, or any 

 

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document in connection therewith, Lender shallnot be entitled to receive, collect or apply, as interest on any Obligation,any amount in excess of the Maximum Amount (the “Excess”).  As used herein, “Maximum Amount” shall meanthe maximum amount of interest which would have accrued if the unpaid principalamount of the Obligation outstanding from time to time had borne interest eachday at the maximum amount of interest which lender is permitted to charge onthe Obligation under the Usury Laws.  IfLender ever receives, collects or applies as interest any Excess, such Excessshall be deemed a partial repayment of principal and treated hereunder as such;and if principal is paid in full, any remaining Excess shall be paid toBorrower.  In determining whether or notthe interest paid or payable under any specific contingency exceeds the MaximumAmount, Borrower and Lender shall, to the maximum extent permitted under theUsury Laws, (a) characterize any nonprincipal payment as an expense, fee orpremium rather than as interest, (b) exclude voluntary prepayments and theeffect thereof, and (c) amortize, prorate, allocate and spread in equal parts,the total amount of interest throughout the entire contemplated term of theObligation so that the interest rate is uniform throughout the entire term ofthe Obligation; provided that if the Obligation is paid and performed in fullprior to the full contemplated term thereof, and if the interest received forthe actual period of existence thereof exceeds the Maximum Amount, Lender shallrefund to Borrower the Excess, and, such event shall not be subject to anypenalties provided by the Usury Laws.

 

**23.  GOVERNING LAW.**  THEINTERPRETATION, CONSTRUCTION AND VALIDITY OF THIS AGREEMENT AND THE NOTE SHALLBE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO CONFLICTOF LAW PROVISIONS.

 

**24.  MISCELLANEOUS.** (a)Subject to the limitations herein, this Agreement shall be binding upon andinure to the benefit of the parties hereto and their respective heirs,administrators, successors and assigns. (b) This Agreement may be executed in any number of counterparts, whichtogether shall constitute a single instrument. (c) Section and paragraph headings in this Agreement are for convenienceonly and have no independent meaning. (d) The terms of this Agreement shall be severable and if any termthereof is declared unconscionable, invalid, illegal or void, in whole or inpart, the decision so holding shall not be construed as impairing the otherterms of this Agreement and this Agreement shall continue in full force andeffect as if such invalid, illegal, void or unconscionable term were notoriginally included herein.  (e) Allindemnity obligations of Borrower under this Agreement and all rights, benefitsand protections provided to Lender by warranty disclaimers shall survive thecancellation, expiration or termination of this Agreement.  (f) Lender shall not be liable to Borrowerfor any indirect, consequential or special damages for any reason whatsoever.  (g) This Agreement may be amended, but onlyby a written amendment signed by Lender and Borrower.  (h) If this Agreement is signed by more thanone Borrower, each of such Borrowers shall be jointly and severally liable forpayment and performance of all of Borrower’s obligations under this Agreement.(i) This Agreement represents the final, complete and entire agreement betweenthe parties hereto, and there are no oral or unwritten agreements orunderstandings affecting this Agreement or the Collateral.  (j) Borrower agrees that Lender is not theagent of any manufacturer or supplier, that no manufacturer or supplier is anagent of Lender, and that any representation, warranty or agreement made bymanufacturer, supplier or by their employees, sales representatives or agentsshall not be binding on Lender.

 

**24**.  **GOVERNMENT REGULATION**.  Borrower shall not (a) be or become subject, at any time, to any law,regulation, or list of any government agency (including, without limitation,the U.S. Office of Foreign Asset Control list) that prohibits or limits Lenderfrom making any advance or extension of credit to Borrower or from otherwiseconducting business with Borrower or (b) fail to provide documentary and otherevidence of Borrower’s identity as may be requested by Lender at any time to enableLender to verify Borrower’s identity or to comply with any applicable law orregulation, including, without limitation, Section 326 of the USA Patriot Actof 2001, 31 U.S.C. Section 5318.

 

**25**. **USA PATRIOT ACTNOTIFICATION**.  The followingnotification is provided to Borrower pursuant to Section 326 of the USA PatriotAct of 2001, 31 U.S.C. Section 5318:

 

IMPORTANT INFORMATION ABOUTPROCEDURES FOR OPENING A NEW ACCOUNT. To help the government fight the fundingof terrorism and money laundering activities, Federal law requires allfinancial institutions to obtain, verify, and record information thatidentifies each person or entity that opens an account, including any depositaccount, treasury management account, loan, other extension of credit, or otherfinancial services product. What this means for Borrower: When Borrower opensan account, if Borrower is an individual, Lender will ask for Borrower’s name,tax payer identification number, residential address, date of birth, and otherinformation that will allow Lender to identify Borrower, and if Borrower is notan individual, Lender will ask for Borrower’s name, taxpayer identificationnumber, business address, and other information that will allow Lender toidentify Borrower.  Lender may also ask,if Borrower is an individual, to see Borrower’s driver’s license or otheridentifying documents, and if Borrower is not an individual, to see Borrower’slegal organizational documents or other identifying documents.

 

[Thenext page is the signature page.]

 

----

 

**ALL PARTIES TO THIS AGREEMENT,INCLUDING LENDER AND THE UNDERSIGNED, IRREVOCABLY CONSENT TO THE JURISDICTIONAND VENUE OF ANY STATE OR FEDERAL COURT IN NEW YORK, AND WAIVE ALL RIGHTS TOTRIAL BY JURY, IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTYAGAINST ANY OTHER PARTY ON ANY MATTER WHATSOEVER ARISING OUT OF, IN CONNECTIONWITH OR IN ANY WAY RELATED TO THE NOTE OR THIS AGREEMENT.**

 
| **AIRNET  SYSTEMS, INC.** | Accepted By Lender:           |
|---------------------------|-------------------------------|
| (Borrower)                | CHASE EQUIPMENT LEASING  INC. |
|                      |                          |
| By:                       | /s/ Wynn Peterson             |   | By: | /s/ Tami Weikel |   |
|                      |                          |   |   |
| Title:                    |  Vice President          |   | Title: | Funding Manager |   |
|                      |                          |   |   |
| Witness:                  |  /s/ John Gordon         |   | Acceptance Date: | March 24, 2005 |   |
|                           |                               |  |  |  |  |  |  |  |  |  |  |

 

 

**BorrowerOrganization Information: **A Corporation organized under the laws of theState of Ohio with State Organization #31-1458309

 

----

 

**SCHEDULE  A-1**

 

**Loan No. 1000122039**

 

**FinancedAmount: $11,000,000.00**

 

DESCRIPTIONOF EQUIPMENT 

 

### *AIRCRAFT #1*

 
|                         | Equipment Cost:               | $677,270.00 |
|------------------------------|-------------------------------|-------------|
|                         |                          |        |
| Airframe  Make/Model:        | 1978  GATES LEAR JET 35       |        |
|                         |                          |        |
| *Airframe Serial No.:*       | *178*                         | * *    |
|                         |                          |        |
| U.S.  Registration No.:      | N900JC                        |        |
|                         |                          |        |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |
|                         |                          |        |
| Engine  Serial No(s):        | P74550 & P74906           |        |
|                              |                               |             |  |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***PhiladelphiaInternational Airport, 8500 Essington Avenue, Philadelphia, PhiladelphiaCounty, PA  19153***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #2

 
|                         | Equipment Cost:               | $791,780.00 |     |     |
|------------------------------|-------------------------------|-------------|----------|----------|
|                         |                          |        |     |     |
| Airframe  Make/Model:        | 1980 LEAR JET INC. 35A        |        |     |     |
|                         |                          |        |     |     |
| *Airframe Serial No.:*       | *295*                         | * *    | * * | * * |
| * *                     | * *                      | * *    | * * | * * |
| U.S.  Registration No.:      | N94AA                         |        |     |     |
|                         |                          |        |     |     |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |        |     |
|                         |                          |        |     |     |
| Engine  Serial No(s):        | P74422 & P74751           |        |     |     |
|                              |                               |             |          |          |  |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

----

 

# ***PortColumbus International Airport, 4600 International Gtwy., Columbus, FranklinCounty, OH  43219***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #3

 
|                         | Equipment Cost:               | $768,460.00 |     |     |
|------------------------------|-------------------------------|-------------|----------|----------|
|                         |                          |        |     |     |
| Airframe  Make/Model:        | 1979 GATES LEARJET CORP.  35A |        |     |
|                         |                          |        |     |     |
| *Airframe Serial No.:*       | *264*                         | * *    | * * | * * |
| * *                     | * *                      | * *    | * * | * * |
| U.S.  Registration No.:      | N64CP                         |        |     |     |
|                         |                          |        |     |     |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |        |     |
|                         |                          |        |     |     |
| Engine  Serial No(s):        | P89305 & P74303           |        |     |     |
|                              |                               |             |          |          |  |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***St.Paul Downtown Airport, 644 Bayfield Street, St. Paul, Ramsey County, MN  55107***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #4

 
|                         | Equipment Cost:                     | $791,780.00 |     |     |
|------------------------------|-------------------------------------|-------------|----------|----------|
|                         |                                |        |     |     |
| Airframe  Make/Model:        | 1980 GATES LEARJET  CORPORATION 35A |        |     |
|                         |                                |        |     |     |
| *Airframe Serial No.:*       | *342*                               | * *    | * * | * * |
| * *                     | * *                            | * *    | * * | * * |
| U.S.  Registration No.:      | N56JA                               |        |     |     |
|                         |                                |        |     |     |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B       |        |     |
|                         |                                |        |     |     |
| Engine  Serial No(s):        | P74236 & P74898                 |        |     |     |
|                              |                                     |             |          |          |  |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***MemphisInternational Airport, 2491 Winchester Road, Memphis, Shelby County, TN  38116***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

----

 

#### AIRCRAFT #5

 
|                         | Equipment Cost:               | $740,630.00 |     |     |
|------------------------------|-------------------------------|-------------|----------|----------|
|                         |                          |        |     |     |
| Airframe  Make/Model:        | 1980 GATES LEARJET CORP.  35A |        |     |
|                         |                          |        |     |     |
| *Airframe Serial No.:*       | *35A-259*                     | * *    | * * | * * |
| * *                     | * *                      | * *    | * * | * * |
| U.S.  Registration No.:      | N25AN                         |        |     |     |
|                         |                          |        |     |     |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |        |     |
|                         |                          |        |     |     |
| Engine  Serial No(s):        | P73139 & P74333           |        |     |     |
|                              |                               |             |          |          |  |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***DesMoines International Airport, 5800 Fleur Dr., Des Moines, Polk County, IA  50321***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #6

 
|                         | Equipment Cost:               | $819,500.00 |   |   |
|------------------------------|-------------------------------|-------------|--------|--------|
|                         |                          |        |   |   |
| Airframe  Make/Model:        | 1980 LEARJET INC. 35A         |        |   |   |
|                         |                          |        |   |   |
| Airframe  Serial No.:        | 313                           |        |   |   |
|                         |                          |        |   |   |
| U.S.  Registration No.:      | N31WR                         |        |   |   |
|                         |                          |        |   |   |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |        |   |
|                         |                          |        |   |   |
| Engine  Serial No(s):        | P74974 & P74356           |        |   |   |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***WilliamP. Hobby Airport, 8183 Airport Blvd., Houston, Harris County, TX  77061***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

----

 

#### AIRCRAFT #7

 
|                         | Equipment Cost:               | $921,250.00 |   |   |
|------------------------------|-------------------------------|-------------|--------|--------|
|                         |                          |        |   |   |
| Airframe  Make/Model:        | 1982 GATES LEAR JET 35A       |        |   |   |
|                         |                          |        |   |   |
| Airframe  Serial No.:        | 480                           |        |   |   |
|                         |                          |        |   |   |
| U.S.  Registration No.:      | N39DK                         |        |   |   |
|                         |                          |        |   |   |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B |        |   |
|                         |                          |        |   |   |
| Engine  Serial No(s):        | P74230 & P74484           |        |   |   |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***DenverCentennial Airport, 7800 S. Peoria Street, Englewood, Arapahoe County, CO  80112***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #8

 
|                         | Equipment Cost:                          | $791,780.00 |   |   |
|------------------------------|------------------------------------------|-------------|--------|--------|
|                         |                                     |        |   |   |
| Airframe  Make/Model:        | 1980 GATES LEARJET 35A                   |        |   |   |
|                         |                                     |        |   |   |
| Airframe  Serial No.:        | 302                                      |        |   |   |
|                         |                                     |        |   |   |
| U.S.  Registration No.:      | N51LC                                    |        |   |   |
|                         |                                     |        |   |   |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT AiResearch  TFE-731-2-2B |        |   |
|                         |                                     |        |   |   |
| Engine  Serial No(s):        | P74426 & P74752                      |        |   |   |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment, instruments,accessories, attachments, parts, appurtenances, accessions, furnishings andother equipment attached to, installed in or relating to any of the foregoingproperty and all maintenance and service logs and records relating to theforegoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

This item of Equipment shall be based at thefollowing location:

 

# ***Cityof Ft. Lauderdale Executive Airport, 5601 N.W. 15th Avenue, Ft. Lauderdale,Broward County, FL  33309***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #9

 
|                         | Equipment Cost:                | $768,460.00 |     |
|------------------------------|--------------------------------|-------------|----------|
|                         |                           |        |     |
| *Airframe Make/Model:*       | *1979 GATES LEARJET CORP. 35A* | * *    |
| * *                     | * *                       | * *    | * * |
| Airframe  Serial No.:        | 217                            |        |     |
|                         |                           |        |     |
| U.S.  Registration No.:      | N122JW                         |        |     |
|                         |                           |        |     |
| Engine  Quantity/Make/Model: | TWO (2) GARRETT  TFE-731-2-2B  |        |
|                         |                           |        |     |
| Engine  Serial No(s):        | P74267 & P74321            |        |     |
|                         |                           |        |     |
|                              |                                |             |          |  |

 

----

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

Each engine has 750 or more rated takeoffhorsepower or the equivalent of such horsepower.

 

Thisitem of Equipment shall be based at the following location:

 

# ***GrandJunction Airport - Walker Field, 2828 Walker Field Drive, Grand Junction, MesaCounty, CO  81506***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #10

 
|                         | Equipment Cost:                                         | $550,660.00 |   |
|------------------------------|---------------------------------------------------------|-------------|--------|
|                         |                                                    |        |   |
| Airframe  Make/Model:        | 2002 Cessna 208B                                        |        |   |
|                         |                                                    |        |   |
| Airframe  Serial No.:        | 208B0906                                                |        |   |
|                         |                                                    |        |   |
| U.S.  Registration No.:      | N102AN                                                  |        |   |
|                         |                                                    |        |   |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |        |
|                         |                                                    |        |   |
| Engine  Serial No(s):        | PCE-PC0892 (which engine  has less than 750 horsepower) |        |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***FortWayne International Airport - Baer Field, 3801 West Ferguson, Fort Wayne, AllenCounty, IN  46809***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #11

 
|                         | Equipment Cost:                                         | $550,660.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2002 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0928                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N103AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC0928 (which engine  has less than 750 horsepower) |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and records relatingto the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***Wilkes-BarreScranton International Airport, 715 Hawthorne Street, Avoca, Luzerne County,PA  18507***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

----

 

#### AIRCRAFT #12

 
|                         | Equipment Cost:                                         | $550,660.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2001 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0918                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N104AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC0911 (which engine  has less than 750 horsepower) |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***GeneralMitchell International Airport, 5300 S. Howell Avenue, Milwaukee, MilwaukeeCounty, WI  53207***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #13

 
|                         | Equipment Cost:                                         | $575,630.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2002 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0956                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N105AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC0968 (which engine  has less than 750 horsepower) |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***St.Louis Downtown Airport, 1680 Sauget Industrial Parkway, Cahokia, Saint ClairCounty, IL  62206***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #14

 
|                         | Equipment Cost:                                         | $550,660.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2001 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0917                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N106AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC0909 (which engine has less than 750  horsepower) |

 

----

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***PortColumbus International Airport, 4600 International Gtwy., Columbus, FranklinCounty, OH  43219***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #15

 
|                         | Equipment Cost:                                         | $575,630.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2002 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0993                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N107AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A-114A                  |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC1006 (which engine  has less than 750 horsepower) |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

# ***St.Paul Downtown Airport, 644 Bayfield Street, St. Paul, Ramsey County, MN  55107***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

#### AIRCRAFT #16

 
|                         | Equipment Cost:                                         | $575,630.00 |
|------------------------------|---------------------------------------------------------|-------------|
|                         |                                                    |        |
| Airframe  Make/Model:        | 2002 Cessna 208B                                        |        |
|                         |                                                    |        |
| Airframe  Serial No.:        | 208B0975                                                |        |
|                         |                                                    |        |
| U.S.  Registration No.:      | N108AN                                                  |        |
|                         |                                                    |        |
| Engine  Quantity/Make/Model: | ONE (1) PRATT & WHITNEY  PT6A- 114A                 |
|                         |                                                    |        |
| Engine  Serial No(s):        | PCE-PC0988 (which engine  has less than 750 horsepower) |

 

Together with all engines,propellers, avionics, communication equipment, navigation equipment,instruments, accessories, attachments, parts, appurtenances, accessions,furnishings and other equipment attached to, installed in or relating to any ofthe foregoing property and all maintenance and service logs and recordsrelating to the foregoing property.

 

This item of Equipment shall be based at thefollowing location:

 

----

 

# ***NewOrleans Lakefront Airport, 6001 Stars and Stripes Blvd., Suite 101, TerminalBuilding, New Orleans, Orleans County, LA 70126***

| Name of Airport and Street  Address | City | County | State |
|-------------------------------------|------|--------|-------|

 

 

This Schedule A-1 is attached to, and made apart of, the Loan and Security Agreement with the Loan Number referenced aboveand contains a true and accurate description of the Equipment.

 
| **AIRNET  SYSTEMS, INC.** |
|---------------------------|
| (Borrower)                |
|                      |
| By:                       | /s/ Wynn Peterson |   |
|                      |   |   |
| Title:                    | Vice President |   |
|                           |  |  |  |

 

----

 

SCHEDULE  2

 

Attached to Loan and Security Agreement forLoan No. 1000122039

 

ADDITIONAL CONDITIONS TO FUNDING THE LOAN*

 

1.                                       Lender shall conduct a satisfactory physicalinspection of the Collateral, at the expense of Borrower, to includesatisfactory review and acceptance of all maintenance and service logs andreports relating to the Collateral.

 

2.                                       Lender shall receive terminations or releasesof liens in a form recordable with the Federal Aviation Administration from allcreditors with a lien on any part of the Collateral as shown in the FAA lienrecords.

 

3.                                       Lender shall receive UCC-3 terminationsor release of liens in recordable form from all creditors with a lien on anypart of the Collateral as shown in state or local lien records.

 

4.                                       Lender shall receive confirmation that allnine (9) Learjets included in the Collateral are on an approved enginemaintenance program (MSP or JSSI).

 

----

*The inclusion of additional funding conditions in this Schedule 2 shallnot limit the generality of the conditions set forth in the Agreement.

 

 
| **AIRNET SYSTEMS, INC.** | ** **        |
|--------------------------|-------------------|
| (Borrower)               |
|                     |
| By:                      | /s/ Wynn Peterson |   |
|                     |              |
| Title:                   | Vice President    |   |
|                          |                   |  |  |  |

 

----

 

SCHEDULE 3

**AIRCRAFT****LOAN****INSURANCE REQUEST LETTER**

 
|               |   |
|--------------------|--------|
| (Date)             |   |
|               |   |
| (Agent)            |   |
|               |   |
| (Street Address)   |   |
|               |   |
| (City, State, Zip) |   |
|               |   |
| (Telephone Number) |   |

 

DearAgent:

 

Chase Equipment Leasing Inc. (“CELI”) (f/k/aBanc One Leasing Corporation) requires proof of acceptable insurance coveragebefore the loan transaction can close. The requirements identified below must stay in full effect throughoutthe term of the transaction.

 

1.               The certificate of insurance must be issueddirectly to Chase Equipment Leasing Inc. and shall be issued by a companyhaving an A.M. Best Rating of at least A with a Financial Size Category ofat least VII.

2.               The certificate of insurance must be executed.

3.               The insurance must be primary and anyinsurance maintained by CELI or any other loss payee will be in excess andnon-contributory.

4.               Policies must include a Waiver of Subrogationin favor of “Chase Equipment Leasing Inc., its parent and affiliates,successors or assigns”.

5.               Policies must include a thirty (30) day priorwritten Notice of Cancellation to the Certificate Holder.  Such notice must be directed by certifiedmail to: Chase Equipment Leasing Inc., 1111 Polaris Parkway, Suite A3,Columbus, Ohio 43240, Attn:  InsuranceDept.

6.               PHYSICAL DAMAGE

a.               Replacement cost coverage for the equipmentidentified on the attached Schedule A-1, which is estimated to be$15,600,000.00.

b.              “Chase Equipment Leasing Inc., its parent andaffiliates, successors or assigns” shall be named as Loss Payee.

c.               Breach of Warranty in favor “Chase EquipmentLeasing Inc., its parent and affiliates, successors or assigns”.

d.              War Risk Endorsement, which shall includehijacking and terrorism, in favor of “Chase Equipment Leasing Inc., its parentand affiliates, successors or assigns” for the amount identified in 6a.

7.               The certificate of insurance shall evidenceliability coverage in the minimum amount of $50 million.

 

Pleaseimmediately send proof of the above insurance requirements **VIAFACSIMILE TRANSMITTAL 614-213-0748**.

 

**PLEASE REFERENCE THE COMPLETE LOAN NUMBER AS LISTED BELOW FOR TRACKINGPURPOSES.**

**THANK YOU.**

 
| Sincerely,           |   |
|----------------------|--------|
| AIRNET SYSTEMS, INC. |   |
|                 |   |
| /s/ Wynn Peterson    |   |
| (By)                 |   |
|                      |        |  |

 

(LoanNumber)     1000122039

 

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