EXECUTION
VERSION
 Exhibit 10.3




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PAGEARTICLE I DEFINITIONS
    
    
    1Section 1.01 Definitions
    
    
    2Section 1.02 Construction and Usage
    
    
    7ARTICLE II SECURITY
    
    
    8Section 2.01 Grant of Security
    
    
    8Section 2.02 Security for Obligations
    
    
    10Section 2.03 Representations and Warranties of the Grantors
    
    
    10Section 2.04 Grantors Remain Liable
    
    
    12Section 2.05 Delivery of Collateral
    
    
    12Section 2.06 As to the Assigned Documents
    
    
    13Section 2.07 As to Beneficial Interest Collateral
    
    
    14Section 2.08 Further Assurances
    
    
    15Section 2.09 Place of Perfection; Records
    
    
    17Section 2.11 Transfers and Other Liens; Additional Shares or Interests
    
    
    18Section 2.12 Collateral Agent Appointed Attorney-in-Fact
    
    
    18Section 2.13 Collateral Agent May Perform
    
    
    19Section 2.14 Covenant to Pay
    
    
    19Section 2.15 Delivery of Collateral Supplements
    
    
    19Section 2.16 Operational Covenants
    
    
    19Section 2.17 Insurance
    
    
    21ARTICLE III REMEDIES
    
    
    21Section 3.01 Remedies
    
    
    21Section 3.02 Priority of Payments
    
    
    22ARTICLE IV SECURITY INTEREST ABSOLUTE
    
    
    22Section 4.01 Security Interest Absolute
    
    
    23ARTICLE V THE COLLATERAL AGENT
    
    
    23Section 5.01 Authorization and Action
    
    
    23Section 5.02 Absence of Duties
    
    
    24Section 5.03 Representations or Warranties
    
    
    24Section 5.04 Reliance; Agents; Advice of Counsel
    
    
    24Section 5.05 Cape Town Convention
    
    
    26Section 5.06 No Individual Liability
    
    
    26
 i




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PAGEARTICLE VI SUCCESSOR COLLATERAL AGENT
    
    
    26Section 6.01 Resignation and Removal of the Collateral Agent
    
    
    26Section 6.02 Appointment of Successor
    
    
    26ARTICLE VII INDEMNITY AND EXPENSES
    
    
    27Section 7.01 Indemnity
    
    
    27Section 7.02 Secured Parties Indemnity
    
    
    28Section 7.03 No Compensation from Secured Parties
    
    
    29Section 7.04 Collateral Agent Fees
    
    
    29ARTICLE VIII MISCELLANEOUS
    
    
    29Section 8.01 Amendments; Waivers; Etc
    
    
    29Section 8.02 Addresses for Notices
    
    
    30Section 8.03 No Waiver; Remedies
    
    
    30Section 8.04 Severability
    
    
    30Section 8.05 Continuing Security Interest; Assignments
    
    
    30Section 8.06 Release and Termination
    
    
    31Section 8.07 Currency Conversion
    
    
    31Section 8.08 Governing Law
    
    
    32Section 8.09 Jurisdiction; Consent to Service of Process
    
    
    32Section 8.10 Counterparts
    
    
    32Section 8.11 Table of Contents, Headings, Etc
    
    
    33Section 8.12 Non-Invasive Provisions
    
    
    33Section 8.13 Limited Recourse
    
    
    34
  Schedule I
    
    Aircraft, Airframes and EnginesSchedule II
    
    Pledged Stock, Pledged Beneficial Interest and Pledged Membership InterestsSchedule III
    
    Trade NamesSchedule IV
    
    Chief Place of Business and Chief Executive or Registered OfficeSchedule V
    
    InsuranceEXHIBITSExhibit A-1
    
    Form of Collateral SupplementExhibit A-2
    
    Form of Grantor SupplementExhibit B
    
    Form of Consent and AgreementExhibit C
    
    Form of FAA Aircraft MortgageExhibit D
    
    Form of FAA Aircraft Mortgage and Lease Security AssignmentExhibit E
    
    Form of FAA Lease Security AssignmentExhibit F-1
    
    Form of Notice of AssignmentExhibit F-2
    
    Form of Acknowledgment
 ii




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##### 



Agreement ILFC Initial
Intermediate Lessees Grantors Bank of America Collateral Agent
  Borrower Lenders Administrative Agent Credit
Agreement




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##### 



Section 1.01 Definitions Certain Defined Terms
                2




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3




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4




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5




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provided
 6




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Terms Defined in the Cape Town Convention
 Terms Defined in the Credit Agreement
 Section 1.02 Construction and Usage
        7




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provided however
 
 Section 2.01 Grant of Security
 Collateral
   8




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##### 



Assigned
Leases Lease Collateral
 Beneficial Interest
Collateral
   Assigned Agreement
Collateral
 Assigned Agreements
  Aircraft Purchase Collateral
 9




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##### 



provided
 Section 2.02 Security for Obligations
 Section 2.03 Representations and Warranties of the Grantors
   10




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11




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Section 2.04 Grantors Remain Liable
 Section 2.05 Delivery of Collateral Chattel Paper Original
 12




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Section 2.06 As to the Assigned Documents
 provided
    13




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provided however
 Section 2.07 As to Beneficial Interest Collateral
   14




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Section 2.08 Further Assurances
 15




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Required Cape Town Registrations
 16




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Section 2.09 Place of Perfection; Records
 Section 2.10 Voting Rights; Dividends; Etc
   17




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Section 2.11 Transfers and Other Liens; Additional Shares or Interests
 Section 2.12 Collateral Agent Appointed Attorney-in-Fact
    18




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##### 



provided
 Section 2.13 Collateral Agent May Perform
 Section 2.14 Covenant to Pay
 Section 2.15 Delivery of Collateral Supplements provided provided further
 Section 2.16 Operational Covenants
 Operation and Use provided
 19




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##### 



Third
Party Event provided inter alia
 Identification of Collateral Agents Interest
 Registration provided provided
 Extension, Amendment or Replacement of Leases
 20




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##### 



Lessee Notice Lessee Acknowledgment
    Section 2.17 Insurance
 
 Section 3.01 Remedies
  21




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##### 



Section 3.02 Priority of Payments
 first
 second
 22




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##### 



Section 4.01 Security Interest Absolute
       
  Section 5.01 Authorization and Action
 23




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Section 5.02 Absence of Duties
 Section 5.03 Representations or Warranties
 Section 5.04 Reliance; Agents; Advice of Counsel
 24




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##### 



provided however
     25




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##### 



Section 5.05 Cape Town Convention
 Section 5.06 No Individual Liability
 
 Section 6.01 Resignation and Removal of the Collateral Agent
 Section 6.02 Appointment of Successor
 26




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##### 



provided
   
 Section 7.01 Indemnity provided
 27




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##### 



provided
  Section 7.02 Secured Parties Indemnity mutatis mutandis
 provided
 provided
 28




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##### 



Section 7.03 No Compensation from Secured Parties
 Section 7.04 Collateral Agent Fees
 
 Section 8.01 Amendments; Waivers; Etc
   29




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##### 



Section 8.02 Addresses for Notices
  
  th
  Section 8.03 No Waiver; Remedies
 Section 8.04 Severability
 Section 8.05 Continuing Security Interest; Assignments
 30




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Section 8.06 Release and Termination
   Section 8.07 Currency Conversion Received Currency Agreed Currency
 31




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##### 



Section 8.08 Governing Law
 Section 8.09 Jurisdiction; Consent to Service of Process
   Section 8.10 Counterparts
 32




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##### 



Section 8.11 Table of Contents, Headings, Etc
 Section 8.12 Non-Invasive Provisions
   33




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##### 



provided
   Section 8.13 Limited Recourse
   34




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[The Remainder of this Page is Intentionally Left Blank]
 35




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INTERNATIONAL LEASE FINANCE CORPORATIONBy /s/ Pamela S. HendryName:
    Pamela S. HendryTitle:
    Senior Vice President & Treasurer 36




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37




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SIGNED AND DELIVERED AS A DEED
By ILFC (BERMUDA) III, LTD.By /s/ S. George CubbonName:
    S. George CubbonTitle:
    President  
 38




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BANK OF AMERICA, N.A. not in its individual capacity but
solely as the Collateral AgentBy /s/ Robert RittelmeyerName:
    Robert RittelmeyerTitle:
    Vice President 39




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##### 



AirframeManufacturer and
    
    
    
    
    
    Engine Manufacturer andModel
    
    Airframe MSN
    
    Model
    
    Engine MSNs1
    
    Airbus A319-100
    
    
    2203
    
    
    IAE V2524-A5
    
    V11654, V116632
    
    Airbus A319-100
    
    
    2200
    
    
    IAE V2524-A5
    
    V11657, V116593
    
    Airbus A319-100
    
    
    2008
    
    
    IAE V2524-A5
    
    V11505, V115064
    
    Airbus A319-100
    
    
    1986
    
    
    IAE V2524-A5
    
    V11481, V114845
    
    Airbus A319-100
    
    
    1971
    
    
    IAE V2524-A5
    
    V11459, V114646
    
    Airbus A319-100
    
    
    1742
    
    
    CFM56-5B6/P
    
    575414, 5754157
    
    Airbus A319-100
    
    
    1673
    
    
    CFM56-5B6/P
    
    575344, 5753458
    
    Airbus A320-200
    
    
    877
    
    
    IAE V2527-A5
    
    V10312, V103809
    
    Airbus A320-200
    
    
    816
    
    
    IAE V2527-A5
    
    V10313, V1034210
    
    Airbus A320-200
    
    
    543
    
    
    IAE V2527-A5
    
    V10222, V1022311
    
    Airbus A320-200
    
    
    582
    
    
    IAE V2527-A5
    
    V10156, V1018712
    
    Airbus A321-200
    
    
    991
    
    
    CFM56-5B3/P
    
    779489, 77949513
    
    Airbus A321-200
    
    
    841
    
    
    CFM56-5B3/P
    
    779386, 77938714
    
    Airbus A321-200
    
    
    815
    
    
    CFM56-5B3/P
    
    779367, 77936815
    
    Airbus A330-200
    
    
    272
    
    
    CF6-80E1-A4
    
    811152, 81115316
    
    Airbus A330-200
    
    
    205
    
    
    CF6-80E1-A4
    
    811141, 81114817
    
    Airbus A330-300
    
    
    55
    
    
    CF6-80E1-A2
    
    811110, 81111118
    
    Airbus A340-600
    
    
    534
    
    
    Rolls-Royce TRENT 556-61
    
    71138, 71139, 71141, 7114219
    
    Airbus A340-600
    
    
    475
    
    
    Rolls-Royce TRENT 556-61
    
    71033, 71047, 71070, 7107320
    
    Boeing 737-300
    
    
    28200
    
    
    CFM56-3C1
    
    858485, 85848621
    
    Boeing 737-700
    
    
    29360
    
    
    CFM56-7B22
    
    892266, 89326122
    
    Boeing 737-700
    
    
    30676
    
    
    CFM56-7B22
    
    892437, 89343623
    
    Boeing 737-700
    
    
    30674
    
    
    CFM56-7B26
    
    890849, 89085024
    
    Boeing 737-700
    
    
    28258
    
    
    CFM56-7B22
    
    890429, 89043025
    
    Boeing 737-700
    
    
    30035
    
    
    CFM56-7B22
    
    890372, 89037326
    
    Boeing 737-700
    
    
    28255
    
    
    CFM56-7B22
    
    890363, 89036427
    
    Boeing 737-700
    
    
    30634
    
    
    CFM56-7B22
    
    890249, 89025128
    
    Boeing 737-800
    
    
    30632
    
    
    CFM56-7B26
    
    888853, 88885629
    
    Boeing 737-800
    
    
    30631
    
    
    CFM56-7B26
    
    888773, 88877630
    
    Boeing 737-800
    
    
    28242
    
    
    CFM56-7B26
    
    888555, 88957131
    
    Boeing 757-200ER
    
    
    29378
    
    
    Pratt & Whitney PW2037
    
    P728749, P72875032
    
    Boeing 757-200ER
    
    
    29385
    
    
    Pratt & Whitney PW2037
    
    P728739, P72874033
    
    Boeing 757-200ER
    
    
    26249
    
    
    Rolls-Royce RB211-535E4
    
    31665, 31667




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##### 



AirframeManufacturer and
    
    
    
    
    
    Engine Manufacturer andModel
    
    Airframe MSN
    
    Model
    
    Engine MSNs34
    
    Boeing 757-200ER
    
    
    29954
    
    
    Pratt & Whitney PW2037
    
    P728713, P72871435
    
    Boeing 757-200ER
    
    
    26247
    
    
    Rolls-Royce RB211-535E4
    
    31635, 3163636
    
    Boeing 757-200ER
    
    
    26248
    
    
    Rolls-Royce RB211-535E4
    
    31637, 3164237
    
    Boeing 767-300ER
    
    
    27617
    
    
    General Electric
CF6-80C2-B6F
    
    704759, 70476038
    
    Boeing 767-300ER
    
    
    25170
    
    
    General Electric
CF6-80C2-B6F
    
    703176, 70485939
    
    Boeing 767-300ER
    
    
    26259
    
    
    General Electric
CF6-80C2-B6F
    
    704127, 70485840
    
    Boeing 767-300ER
    
    
    26257
    
    
    General Electric
CF6-80C2-B7F
    
    702871, 70314941
    
    Boeing 777-200ER
    
    
    35296
    
    
    General Electric GE90-94B
    
    900493, 90049442
    
    Boeing 777-200ER
    
    
    32703
    
    
    General Electric GE90-90B
    
    900438, 90043943
    
    McDonnell Douglas
MD-11F
    
    
    48631
    
    
    Pratt & Whitney PW4462
    
    P733765, P733766, P733767
 2




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Percentage ofBorrower
    
    Certificate No.
    
    Beneficial InterestN/A
    
    N/A
    
    N/A
 3




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1.
    
    Grantor: International Lease Finance Corporation 
Trade Name: ILFC
 4




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Chief Executive Office, Chief Place ofBusiness or Registered OfficeName of Grantor
    
    and Organizational ID (if applicable)International Lease Finance
    
    10250 Constellation Blvd.Corporation
    
    Suite 3400Los Angeles, CA 90067Facsimile: (310) 788-1990Telephone: (310) 788-1999Organizational ID: C1666861ILFC Ireland Limited
    
    30 North Wall QuayDublin 1IrelandFacsimile: +353 1 672 0270Telephone: +353 1 802 8901Company Registration Number: 209316ILFC (Bermuda) III, Ltd.
    
    The Chartis Building29 Richmond RoadPembroke HM 08BermudaAttention: Secretary of the CompanyFacsimile: +1 441 295-6983Telephone: +1 441 295-2121Organizational ID: 17575
 5




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1.
    
    Obligation to InsureSo long as this Agreement shall remain in effect, the Grantors will ensure that there is
effected and maintained appropriate insurances in respect of each Pool Aircraft and the
Collateral Agent, the Administrative Agent, the Lenders and its operation including insurance
for:
 (a)
    
    loss or damage to each Pool Aircraft and each part thereof; and(b)
    
    any liability for injury to or death of persons and damage to or the
destruction of public or private property arising out of or in connection with the
operation, storage, maintenance or use of (in each case to the extent available) the
Pool Aircraft and of any other part thereof not belonging to the Grantors but from time
to time installed on the airframe.
 2.
    
    Specific InsurancesThe Grantors will maintain or will cause to be maintained the following specific
insurances with respect to each Pool Aircraft (subject to paragraph 3):
 (a)
    
    All Risks Hull Insurance All risks hull insurance policy on the Pool Aircraft
in an amount at least equal to 110% of the outstanding principal of the Loans allocable
to such Pool Aircraft, calculated based on the most recent appraised value (the
Required Insured Value) on an agreed value basis and naming the Collateral
Agent (for and on behalf of itself and the Secured Parties) as a loss payee for the
Required Insured Value (provided, however, that, if the applicable
Lessees insurance program uses AVN67B or a successor London market endorsement similar
thereto, the Grantor shall use reasonable commercial efforts to procure that the
Collateral Agent and the Administrative Agent are also named as a Contract Party and
shall ensure that the Collateral Agent and the Administrative Agent are also named as a
Contract Party in respect of any new Lease entered into);(b)
    
    Hull War Risk Insurance Hull war risk and allied perils insurance, including
hijacking, (excluding, however, confiscation by government of registry or country of
domicile to the extent coverage of such risk is not generally available to the
applicable Lessee in the relevant insurance market at a commercially reasonable cost or
is not customarily obtained by operators in such jurisdiction at such time) on the Pool
Aircraft where the custom in the industry is to carry war risk for aircraft operating on
routes or kept in locations similar to the Pool Aircraft in an amount not less than the
Required Insured Value on an agreed value basis and naming the Collateral Agent (for and
on behalf of itself and the other Secured Parties) as a loss




---



##### 



payee for the Required Insured Value (provided, however, that, if the
applicable Lessees insurance program uses AVN67B or a successor London market
endorsement similar thereto, the Grantors shall use reasonable commercial efforts to
procure that the Collateral Agent and the Administrative Agent are also named as a
Contract Party and shall ensure that the Collateral Agent and the Administrative
Agent are also named as a Contract Party in respect of any new Lease entered into);
 (c)
    
    Legal Liability Insurance Third party legal liability insurance (including
war and allied perils) for a combined single limit (bodily injured and property damage)
of not less than $500,000,000 for a Narrowbody Aircraft, and not less than $750,000,000
for Widebody Aircraft (or, with respect to the Aircraft bearing manufacturers serial
number 48631, solely for the period during which it is leased to World Airways, Inc., or
the Aircraft bearing manufacturers serial number 26257, solely for the period during
which it is leased to North American Airlines, Inc., in each case $600,000,000). The
Collateral Agent and the Administrative Agent (on behalf of themselves and the Secured
Parties) shall be named as additional insureds on such policies; provided that
the Grantors shall ensure that the Collateral Agent and the Administrative Agent are
also named as an additional insured in respect of any new Lease.(d)
    
    Aircraft Spares Insurance Insurance for the engines and the parts while not
installed on the airframe for their replacement cost or an agreed value basis.
 3.
    
    Variations on Specific Insurance RequirementsIn certain circumstances, it is customary that not all of the insurances described in
paragraph 2 be carried for the Pool Aircraft. For example, when a Pool Aircraft is not on
lease to a passenger air carrier or is in storage or is being repaired or maintained, ferry
or ground rather than passenger flight coverage for the Pool Aircraft are applicable.
Similarly, indemnities may be provided by a Governmental Authority in lieu of particular
insurances; provided, however, that the Grantors shall not, without the prior
written consent of the Collateral Agent, be entitled to accept any new such governmental
indemnities other than when such indemnities are granted by a Governmental Authority of a
country or jurisdiction that is not a Prohibited Country. The relevant Grantor will
determine the necessary coverage for the Pool Aircraft in such situations consistent with
Leasing Company Practice with respect to similar aircraft.4.
    
    Hull Insurances in Excess of Required Insurance ValueFor the avoidance of doubt, any Grantor and/or any Lessee may carry hull risks and hull
war and allied perils insurance on the Pool Aircraft in excess of the Required Insured Value
which (subject in the case of the Grantors to no Event of Default having occurred and being
continuing) will not be payable to the Collateral Agent. Such excess insurances will be
payable to (i) if payable to the Grantors, to the relevant Grantor, unless an Event of
Default has occurred and is continuing in which case the excess shall be payable to the
Collateral Agent or (ii) if payable to the Lessee to the Lessee in all circumstances.
 2




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5.
    
    CurrencyAll insurance and reinsurances effected pursuant to this Schedule V shall be payable in
Dollars, save that in the case of the insurances referred to in paragraph 2(c) (if such
denomination is (a) required by the law of the state of registration of the Pool Aircraft; or
(b) the normal practice of airlines in the relevant country that operate aircraft leased from
lessors located outside such country; or (c) otherwise agreed by the Collateral Agent) or
paragraph 2(d).6.
    
    Specific Terms of InsurancesInsurance policies which are underwritten in the London and/or other non-US insurance
market and which pertain to financed or leased aircraft equipment contain the coverage and
endorsements described in AVN67B as it may be amended or revised or its equivalent. Each of
the Grantors agrees that, so long as this Agreement shall remain in effect, the Pool Aircraft
will be insured and the applicable insurance policies endorsed either (i) in a manner
consistent with AVN67B, as it may be amended or revised or its equivalent or (ii) as may then
be customary in the airline industry for aircraft of the same type as the Pool Aircraft
utilised by operators in the same country and whose operational network for such Pool
Aircraft and credit status is similar to the type of business as the Lessee (if any) and at
the time commonly available in the insurance market. In all cases, the relevant Grantor will
set the standards, review and manage the insurances on the Pool Aircraft consistent with
Leasing Company Practice with respect to similar aircraft.7.
    
    Insurance Brokers and InsurersIn reviewing and accepting the insurance brokers (if any) and reinsurance brokers (if
any) and insurers and reinsurers (if any) providing coverage with respect to the Pool
Aircraft, the relevant Grantor will utilize standards consistent with Leasing Company
Practice with respect to similar aircraft. It is recognized that airlines in certain
countries are required to utilize brokers (and sometimes even no brokers) or carry insurance
with local insurance brokers and insurers. If at any time any Pool Aircraft is not subject
to a Lease, the relevant Grantor will cause its insurance brokers to provide the Collateral
Agent with evidence that the insurances described in this Schedule V are in full force and
effect.8.
    
    Deductible Amounts, Self-Insurance and ReinsuranceWith respect to the type of aircraft concerned, the nationality and creditworthiness of
the airline operator, the airline operators use and operation thereof and to the scope of
and the amount covered by the insurances carried by the Lessee, the relevant Grantor will
apply standards consistent with Leasing Company Practice with respect to similar aircraft in
reviewing and accepting the amount of any insurance deductibles, whether the Lessee may
self-insure any of the risks covered by the insurances and the scope and terms of
reinsurance, if any, including a cut-through and assignment clause.
 3




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9.
    
    RenewalsThe Grantors will monitor the insurances on the Pool Aircraft and their expiration
dates. The relevant Grantor shall, when requested by the Collateral Agent, promptly inform
the Collateral Agent as to whether or not it has been advised that renewal instructions for
any of the insurances have been given by the airline operator or its broker prior to or on
the scheduled expiry date of the relevant insurance. The relevant Grantor shall promptly
notify the Collateral Agent in writing if it receives notice that any of the insurances have
in fact expired without renewal. Promptly after receipt, the relevant Grantor will provide
to the Collateral Agent evidence of renewal of the insurances and reinsurance (if any).10.
    
    InformationSubject to applicable confidentiality restrictions, each of the Grantors shall provide
the Collateral Agent or shall ensure that the Collateral Agent is provided with any
information reasonably requested by it from time to time concerning the insurances maintained
with respect to the Pool Aircraft or, if reasonably available to the Grantors, in connection
with any claim being made or proposed to be made thereunder.
 4




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th
    Aircraft Mortgage and Security Agreement ILFC Initial Intermediate Lessees Grantors




---



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By:Name:Title:  
 By:Name:Title:




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Airframe Manufacturer
    
    
    
    
    
    Engine Manufacturer andAirframe MSN
    
    and Model
    
    Engine MSNs
    
    Model




---



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Percentage ofBorrower
    
    Certificate No.
    
    Beneficial Interest




---



##### 



th
    Aircraft Mortgage and Security Agreement ILFC Initial Intermediate Lessees Grantors
  Grant of Security Interest Supplementary Collateral




---



##### 



Assigned Leases Lease
Collateral
 Beneficial
Interest Collateral
   Assigned Agreement Collateral
 Assigned Agreements
 2




---



##### 



Aircraft Purchase Collateral
   provided
    [Signature Page Follows]
 3




---



##### 



By:Name:Title:  
 By:Name:Title: 4




---



##### 



Airframe Manufacturer
    
    
    
    
    
    Engine ManufacturerAirframe MSN
    
    and Model
    
    Engine MSNs
    
    and Model




---



##### 



Percentage ofBorrower
    
    Certificate No.
    
    Beneficial Interest




---



##### 








---



##### 



Chief Executive Office, Chief Place ofBusiness and Registered Office and OrganizationalName of Grantor
    
    ID (if applicable)




---



##### 



Assigned Document
 Aircraft Mortgage and Security Agreement Collateral




---



##### 



Very truly yours,
[NAME OF GRANTOR]By:Name:Title: BANK OF AMERICA, N.A.,
not in its individual capacity,
but solely as the Collateral AgentBy:Name:Title: Acknowledged and agreed to as of
the date first above written:
[NAME OF OBLIGOR]By:Name:Title: 2




---



##### 



Agreement   Grantor Collateral Agent Aircraft Mortgage ILFC
 W I T N E S S E T H:
 Credit Agreement
  Aircraft
   Mortgage Collateral
 a.
    
    each Aircraft;




---



##### 



b.
    
    all Parts, equipment, attachments, accessories, replacement and added Parts and
components now or hereafter placed thereon, installed therein or attached thereto,
whether or not any of such Parts, equipment, attachments, accessories, replacements or
added parts or components may from time to time no longer be installed on any Aircraft
or may be installed in any other aircraft;c.
    
    all of the Grantors right, title and interest in the technical data, technical
documents, manuals, log books and all inspection, modification, overhaul, service,
repair, maintenance, technical and other records that relate to any Aircraft and all the
Grantors right, title and interest, present and future, therein and thereto and any
sale or other transfer agreement relating to any Aircraft, any acceptance certificate,
and/or bill of sale relating to any Aircraft, any guaranties, letters of credit or other
credit support relating to any Aircraft, and any other certificate, instrument or
agreement relating to any Aircraft or a lessee, user or lessor of any Aircraft
(collectively, the Aircraft Documents);d.
    
    all proceeds from the sale or other disposition of, all proceeds of insurance due
to the Grantor on, and all proceeds of any condemnation due to the Grantor with respect
to, any of the equipment described in clauses (a), (b) and (c) above;e.
    
    all rents, issues, profits, revenues and other income of the property intended,
subjected or required to be subjected to the Lien of this Agreement hereby, by the other
Loan Documents or by any supplement to this Agreement in form and substance satisfactory
to the Collateral Agent, and all of the estate, right, title and interest of every
nature whatsoever of the Grantor in and to the same and every part thereof; andf.
    
    all proceeds, howsoever arising, of the foregoing.
   2




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th
 3




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4




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GRANTOR:
    [_________]By:Name:Title: COLLATERAL AGENT:
    BANK OF AMERICA, N.A., not in its individual capacity
but solely as Collateral AgentBy:Name:Title: 5




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DEFINITIONS
         provided
   6




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7




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MORTGAGE COLLATERAL
  
 
 2.
    
    Aircraft [___] means:
 
 
 8




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Agreement  Grantor Collateral Agent Aircraft Mortgage ILFC
 W I T N E S S E T H:
 Credit Agreement
  Aircraft Assigned Leases
  Mortgage Collateral
 a.
    
    each Aircraft;




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b.
    
    all Parts, equipment, attachments, accessories, replacement and added Parts and
components now or hereafter placed thereon, installed therein or attached thereto, whether
or not any of such Parts, equipment, attachments, accessories, replacements or added parts
or components may from time to time no longer be installed on any Aircraft or may be
installed in any other aircraft;c.
    
    all of the Grantors right, title and interest in the technical data, technical
documents, manuals, log books and all inspection, modification, overhaul, service, repair,
maintenance, technical and other records that relate to any Aircraft and all the Grantors
right, title and interest, present and future, therein and thereto and any sale or other
transfer agreement relating to any Aircraft or any Assigned Lease, any lease assignments,
novations or assumption agreements, relating to any Aircraft or any Assigned Lease, any
acceptance certificate, and/or bill of sale relating to any Aircraft or any Assigned Lease,
any guaranties, letters of credit or other credit support relating to any Aircraft or any
Assigned Lease, and any other certificate, instrument or agreement relating to any Aircraft
or a lessee, user or lessor of any Aircraft (collectively, the Aircraft
Documents);d.
    
    all proceeds from the sale or other disposition of, all proceeds of insurance due to
the Grantor on, and all proceeds of any condemnation due to the Grantor with respect to,
any of the equipment described in clauses (a), (b) and (c) above;e.
    
    each Assigned Lease, and all amendments, supplements, schedules, receipts and
acceptance certificates executed or delivered pursuant thereto, together with all of the
Grantors rights as lessor thereunder including without limitation: (i) all rights, if any,
under § 1110 of the Bankruptcy Code of the United States or any statute of similar import
(whether of the United States or any other jurisdiction and whether now in effect or
hereinafter enacted); (ii) all rights to receive payment of insurance proceeds and payments
with respect to any manufacturers warranty, in each case payable with respect to the
aircraft, the aircraft engines or other property which is the subject of any Assigned
Lease; and (iii) upon the occurrence of an Event of Default to demand, collect, receive and
retain all rent and other sums which may from time to time become payable under or in
connection with any Assigned Lease;f.
    
    all rents, issues, profits, revenues and other income of the property intended,
subjected or required to be subjected to the Lien of this Agreement hereby, by the other
Loan Documents or by any supplement to this Agreement in form and substance satisfactory to
the Collateral Agent (a Mortgage Supplement), and all of the estate, right, title
and interest of every nature whatsoever of the Grantor in and to the same and every part
thereof; andg.
    
    all proceeds, howsoever arising, of the foregoing.
  2




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Successors and Assigns
 Severability
 Governing Law
 Further Assurances
 Notices
  
 3




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th
 Collateral Agent
  Execution in Counterparts
  4




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GRANTOR:
    [_________]By:Name:Title: COLLATERAL AGENT:
    BANK OF AMERICA, N.A., not in its individual capacity but solely as Collateral
AgentBy:Name:Title: 5




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DEFINITIONS
              6




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7




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MORTGAGE COLLATERAL
 
 
 
 
 
 
 8




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FAA LEASE SECURITY ASSIGNMENT (MSN [___])
 Assignment  Grantor Collateral
Agent Aircraft Mortgage ILFC
 W I T N E S S E T H:
 Credit Agreement
  Assigned Leases




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The remainder of this page is intentionally blank
 2




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IN WITNESS WHEREOF
 GRANTOR:
[___]By:Name:Title:COLLATERAL AGENT:BANK OF AMERICA, N.A., not in its individual capacity but
solely as Collateral AgentBy:Name:Title: 3




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Schedule 1
  4




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Lease
  Collateral Agent Security Assignment




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By:Name:Title: 2




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From:
    
    [LESSEE] (the Lessee)To:
    
    BANK OF AMERICA, N.A.,as Collateral Agent[] (the Lessor)
   Assignment
Notice
 Lease
  1.
    
    If the Collateral Agent issues to us a notice (a  Relevant Notice) that its rights
as assignee under the Security Assignment have become exercisable we agree that we shall
thereafter (a) perform, observe and comply with all our other undertakings and obligations
under the Lease in favor and for the benefit of the Collateral Agent as if the Collateral
Agent were named as lessor therein instead of the Lessor; and (b) if the Collateral Agent so
requests and has succeeded to the interests of the Lessor under the Lease, enter into a lease
with the Collateral Agent or its nominee, on the same terms (mutatis mutandis) as the Lease,
provided that (i) no such new lease shall have the effect of releasing the Lessor from
any of its obligations to us under the Lease, (ii) Lessee shall not be responsible for any
additional costs, expenses or charges, including but not limited




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to increased withholding tax liability, which result from entering into such lease and (iii)
from and after the date of the Assignment Notice we shall make all payments under the Lease
as provided in the Assignment Notice or as the Collateral Agent shall direct.
 2.
    
    If the Lessor is in breach of any of its obligations, express or implied, under the Lease, or
if any event occurs which would permit us to terminate, cancel or surrender the Lease we will,
without waiving any such breach or right after the 14-day period referenced below if such
breach has not been performed or a new lease has not been entered into, (a) promptly upon
becoming aware of it, give the Collateral Agent notice of such breach or event, (b) accept as
adequate remedy for any such breach performance by the Collateral Agent of such obligations
within 14 days of our written notice to the Collateral Agent; and/or (c) if the Collateral
Agent so requests and has succeeded to the interests of the Lessor under the Lease, enter into
a lease with the Collateral Agent on terms identical to the Lease, mutatis mutandis;
provided, however, that Lessee shall not be responsible for any additional
costs, expenses or charges, including but not limited to increased withholding tax liability,
which result on the date hereof from entering into such lease.3.
    
    We agree that after issue by the Collateral Agent of any Relevant Notice, we shall not
recognize the exercise by the Lessor of any of its rights and powers under the Lease unless
and until requested to do so by the Collateral Agent.4.
    
    We agree that after receipt of a Relevant Notice the Collateral Agent shall have the
benefits, rights and privileges of the net lease provisions of the Lease and agree that we are
bound by provisions as though the same were set out herein in full mutatis mutandis.5.
    
    No notice of assignment (other than the Assignment Notice) has been received by the Lessee
or, if the Lessee has received any notice of assignment, such notice has been terminated.6.
    
    This acknowledgment shall be governed by and construed in accordance with [New
York]/[English] law.
 
 By:Name:Title: 2