exv10w8






Exhibit 10.8




EXECUTION COPY     




 





SECURITY AND GUARANTEE AGREEMENT




Dated as of April 16, 2010



among



FLYING FORTRESS INC.,




FLYING FORTRESS US LEASING INC.,



FLYING FORTRESS IRELAND LEASING LIMITED,



THE ADDITIONAL GUARANTORS REFERRED TO HEREIN



and




CITICORP USA, INC.



as Collateral Agent



 




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TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page
	ARTICLE I

DEFINITIONS AND INTERPRETATION
	 	 	 	 
	 
	 	 	 	 
	Section 1.01 Certain Defined Terms

	 	 	2	 
	Section 1.02 Accounting Terms

	 	 	8	 
	Section 1.03 Other Definitional Provisions

	 	 	8	 
	 
	 	 	 	 
	ARTICLE II

GUARANTEE
	 	 	 	 
	 
	 	 	 	 
	Section 2.01 Guarantee; Limitation of Liability

	 	 	8	 
	Section 2.02 Guarantee Absolute

	 	 	9	 
	Section 2.03 Waivers and Acknowledgments

	 	 	10	 
	Section 2.04 Subrogation

	 	 	11	 
	Section 2.05 Continuing Guarantee

	 	 	12	 
	Section 2.06 Payments Free and Clear of Taxes, Etc

	 	 	12	 
	Section 2.07 Right of Set-off

	 	 	12	 
	Section 2.08 Subordination

	 	 	12	 
	 
	 	 	 	 
	ARTICLE III

REPRESENTATIONS AND WARRANTIES 
	 	 	 	 
	 
	 	 	 	 
	Section 3.01 Representations and Warranties of each Guarantor

	 	 	13	 
	Section 3.02 Additional Representations and Warranties of the Guarantors

	 	 	15	 
	 
	 	 	 	 
	ARTICLE IV 

COVENANTS
	 	 	 	 
	 
	 	 	 	 
	Section 4.01 Covenants

	 	 	17	 
	 
	 	 	 	 
	ARTICLE V 

GRANT OF SECURITY INTEREST; REMEDIES
	 	 	 	 
	 
	 	 	 	 
	Section 5.01 Grant of Security Interest

	 	 	19	 
	Section 5.02 Security for Obligations

	 	 	20	 
	Section 5.03 Delivery and Control of Security Collateral

	 	 	21	 
	Section 5.04 The Account Collateral

	 	 	21	 
	Section 5.05 Further Assurances

	 	 	22	 
	Section 5.06 Post-Closing Changes

	 	 	23	 
	Section 5.07 Voting Rights; Dividends; Etc

	 	 	23	 
	Section 5.08 Transfers and Other Liens; Additional Shares

	 	 	24	 
	Section 5.09 Agent Appointed Attorney-in-Fact

	 	 	25	 
	Section 5.10 Agent May Perform

	 	 	25	 





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	 	 	Page
	Section 5.11 The Agent’s Duties

	 	 	25	 
	Section 5.12 Remedies

	 	 	26	 
	Section 5.13 Continuing Security Interest

	 	 	27	 
	Section 5.14 Release; Termination

	 	 	27	 
	Section 5.15 Application of Irish Law

	 	 	28	 
	 
	 	 	 	 
	ARTICLE VI 

MISCELLANEOUS 
	 	 	 	 
	 
	 	 	 	 
	Section 6.01 Amendments, Waivers, Supplements, Etc

	 	 	31	 
	Section 6.02 Notices, Etc

	 	 	32	 
	Section 6.03 No Waiver; Remedies Cumulative

	 	 	33	 
	Section 6.04 Indemnification

	 	 	33	 
	Section 6.05 Collateral Agent

	 	 	34	 
	Section 6.06 Assignments; Binding Effect

	 	 	34	 
	Section 6.07 Execution in Counterparts; Severability

	 	 	34	 
	Section 6.08 Governing Law

	 	 	34	 
	Section 6.09 Jurisdiction; Etc

	 	 	34	 
	Section 6.10 Table of Contents, Headings, Etc.

	 	 	35	 
	Section 6.11 Non-Invasive Provisions

	 	 	35	 
	Section 6.12 Limited Liability

	 	 	36	 
	Section 6.13 USA Patriot Act

	 	 	36	 
	Section 6.14 WAIVER OF JURY TRIAL

	 	 	36	 






	 	 	 

	SCHEDULES
	 	 
	 
	 	 
	Schedule I

	 	Location, Chief Executive Office, Type Of
Organization, Jurisdiction Of Organization,
Organizational Identification Number and Trade
Names
	 
	 	 
	Schedule II

	 	Pledged Equity
	 
	 	 
	Schedule III

	 	Changes in Name, Location, Etc.
	 
	 	 
	Schedule 3.02(g)

	 	Authorizations and Approvals
	 
	 	 
	Schedule 4.01(f)

	 	Insurance
	 
	 	 
	EXHIBITS
	 	 
	 
	 	 
	Exhibit A

	 	Form of Guarantee Supplement
	 
	 	 
	Exhibit B

	 	Form of Collateral Supplement






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SECURITY AND GUARANTEE AGREEMENT




Dated as of April 16, 2010


          THIS SECURITY AND GUARANTEE AGREEMENT (as amended, supplemented or otherwise modified from
time to time, this “Agreement”) is made by Flying Fortress Inc., a California corporation (“Holdco
I”), Flying Fortress US Leasing Inc., a California corporation (the “Initial Parent Holdco
(California)”), Flying Fortress Ireland Leasing Limited, a company incorporated under the laws of
Ireland (the “Initial Parent Holdco (Ireland)”, and together with the Initial Parent Holdco
(California), collectively, the “Initial Parent Holdcos” and individually, an “Initial Parent
Holdco”), the Additional Guarantors (as defined below) (Holdco I, the Initial Parent Holdcos and
the Additional Guarantors being, collectively, the “Guarantors”, and individually, each a
“Guarantor”), and Citicorp USA, Inc. (“CUSA”), as collateral agent (in such capacity, together with
any successor collateral agent appointed pursuant to Section 6.05 below, the “Collateral Agent” or
the “Agent”) for the Secured Parties. Capitalized terms used herein without definition shall be
interpreted in accordance with Section 1.03.



PRELIMINARY STATEMENTS



          (A) International Lease Finance Corporation (the “Company”), the Banks party thereto and
Citicorp USA, Inc. as administrative agent for the Banks (in such capacity, together with its
successors and assigns in such capacity, the “Administrative Agent”), are parties to a Five-Year
Revolving Credit Agreement dated as of October 13, 2006 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”) providing, subject to the terms and conditions
thereof, for loans to be made by said Banks to the Company in an aggregate principal amount not
exceeding $2,500,000,000.


          (B) The Company desires to extend the Termination Date under the Credit Agreement, and has
requested that the Banks thereunder extend such Termination Date by entering into Amendment No. 1
to the Credit Agreement, dated as of April 16, 2010 (the “Amendment”), pursuant to which each 2012
Bank shall, among other things, exchange its Commitment existing immediately prior to the Amendment
Effective Date (as defined in the Amendment) for a new commitment with an extended Termination
Date, on the terms and conditions set forth in the Amendment. 


          (C) In connection with Amendment, (i) the Company shall form Holdco I which shall be a special
purpose direct Wholly-owned Subsidiary of the Company, (ii) Holdco I shall form or acquire the
Parent Holdcos (including the Initial Parent Holdcos), each of which shall be a special purpose
direct Wholly-owned Subsidiary of Holdco I and (iii) each Parent Holdco shall form or acquire each
Pledged SPE (as defined below) and, if applicable, each Intermediate Lessee (as defined below),
with each such Pledged SPE and Intermediate Lessee being a special purpose direct Wholly-owned
Subsidiary of a Parent Holdco. Each Pledged SPE shall Own Eligible Aircraft (as defined in the
Credit Agreement).


          (D) Holdco I is the owner of the Equity Interests (as defined below) issued by the Initial
Parent Holdcos (the “Initial Pledged Parent Holdco Equity”) set forth opposite



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Holdco I’s name on and as otherwise described in Schedule II hereto, and each Initial
Parent Holdco is the owner of the Equity Interests issued by the Pledged SPEs (if any) and
Intermediate Lessees (if any) existing on the date hereof (the “Initial Pledged SPE and
Intermediate Lessee Equity”, and together with the Initial Pledged Parent Holdco Equity, the
“Initial Pledged Equity”) set forth opposite such Initial Parent Holdco’s name on and as otherwise
described in Schedule II hereto.



          (E) Holdco I will be the owner of a deposit account (the “Holdco I Cash Collateral Account”,
and together with any other cash collateral account in which a security interest will be granted
hereunder, the “Cash Collateral Accounts”), in each case maintained with Citibank, N.A. or Bank of
America, N.T.&S.A. in New York, New York.


          (F) It is a condition precedent to the effectiveness of the Amendment and the extension of the
Termination Date with respect to the 2012 Banks that the Guarantors execute and deliver this
Agreement, to, among other things, enter into the Guarantee (as defined below) and grant the
security interest contemplated hereby.


          (G) The Guarantors are entering into this Agreement in order to guarantee the Guaranteed
Obligations (as defined below) and to grant to the Agent for the ratable benefit of the Secured
Parties a security interest in the Collateral (as defined below).


          (H) Each Guarantor will derive substantial direct and indirect benefits from the transactions
contemplated by the Amendment.


          NOW, THEREFORE, in consideration of the premises and in order to induce the 2012 Banks to
enter into the Amendment and to extend the Termination Date, each Guarantor hereby jointly and
severally agrees as follows:



ARTICLE I

DEFINITIONS AND INTERPRETATION



          Section 1.01 Certain Defined Terms. As used in this Agreement, the following terms shall
have the following meanings (such meanings to be equally applicable to both the singular and the
plural forms of the terms defined):




          “Account Collateral” has the meaning specified in Section 5.01(b).




          “Additional Guarantor” has the meaning specified in Section 6.01(d).




          “Agent” has the meaning specified in the first paragraph to this Agreement.




          “Agreement” has the meaning specified in the first paragraph of this Agreement.




          “Amendment” has the meaning specified in the Preliminary Statements to this Agreement.



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          “Bankruptcy Law” has the meaning specified in Section 2.01(b).




          “Cash Collateral Accounts” has the meaning specified in the Preliminary Statements to
this Agreement.




          “Cash Equivalents” means, in each case, book-entry securities, negotiable instruments
or securities in bearer or registered form that evidence: (a) direct obligations of, and
obligations fully guaranteed as to timely payment by, the United States of America (having
original maturities of no more than 365 days, or such lesser time as is required for the
distribution of funds); (b) demand deposits, time deposits or certificates of deposit of the
Collateral Agent or of depositary institutions or trust companies organized under the laws
of the United States of America or any state thereof, or the District of Columbia (or any
domestic branch of a foreign bank) (i) having original maturities of no more than 365 days,
or such lesser time as is required for the distribution of funds; provided that at the time
of investment or contractual commitment to invest therein, the short-term debt rating of
such depositary institution or trust company shall be at least “A-1” by S&P and “P-1” by
Moody’s and the long-term debt rating of such depositary or institution or trust company
shall be at least A1 by Moody’s or (ii) having maturities of more than 365 days and, at the
time of the Investment or contractual commitment to invest therein, a rating of “AA” by S&P
and “Aa1” by Moody’s; (c) fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (a) of this definition and entered into with
a financial institution satisfying the criteria described in clause (b) of this definition;
(d) corporate or municipal debt obligations (including open market commercial paper)
(i) having remaining maturities of no more than 365 days, or such lesser time as is required
for the distribution of funds, and having, at the time of the investment or contractual
commitment to invest therein, a rating of at least “A-1+” or “AA” by S&P and “P-1” or “Aa1”
by Moody’s or (ii) having maturities of more than 365 days and, at the time of the
Investment or contractual commitment to invest therein, a rating of “AA” by S&P and “Aa1” by
Moody’s; (e) investments in money market funds (including funds in respect of which the
Collateral Agent or any of its Affiliates is investment manager or advisor, including but
not limited to Citicorp USA, Inc. money market funds) having a rating of at least “AA” by
S&P and “Aa2” by Moody’s previously approved by the Company or the Collateral Agent; or (f)
notes or bankers’ acceptances (having original maturities of no more than 365 days, or such
lesser time as is required for the distribution of funds) issued by any depositary
institution or trust company satisfying the criteria described in clause (b) above;
provided, however, that no investment shall be made in any obligations of any depositary
institution or trust company which has a contractual right to set off and apply any deposits
held, and other indebtedness owing, by the Company or any Guarantor to or for the credit or
the account of such depositary institution or trust company; provided
further, that if, at any time, the rating of any of the foregoing investments falls
below “BBB” by S&P or Baa2” by Moody’s, such downgrades investments shall no longer
constitute “Cash Equivalents”.




          “Collateral” has the meaning specified in Section 5.01.




          “Collateral Agent” has the meaning specified in the first paragraph to this


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Agreement.





          “Collateral Supplement” means a supplement to this Agreement in substantially the form
attached as Exhibit B hereto.




          “Company” has the meaning specified in the Preliminary Statements to this Agreement.




          “Credit Agreement” has the meaning specified in the Preliminary Statements to this
Agreement.




          “Equity Interests” means, with respect to any Person, shares of capital stock of (or
other ownership or profit interests in) such Person, warrants, options or other rights for
the purchase or other acquisition from such Person of shares of capital stock of (or other
ownership or profit interests in) such Person, securities convertible into or exchangeable
for shares of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or other acquisition
from such Person of such shares (or such other interests), and other ownership or profit interests in such Person
(including, without limitation, partnership, member or trust interests therein), whether
voting or nonvoting, and whether or not such shares, warrants, options, rights or other
interests are authorized or otherwise existing on any date of determination.




          “Guarantee” means the guarantee of the Guarantors set forth in Article II hereof.




          “Guarantee Supplement” has the meaning specified in Section 6.01(d).




          “Guaranteed Obligations” has the meaning specified in Section 2.01(a).




          “Guarantor” has the meaning specified in the first paragraph to this Agreement.




          “Guarantor Material Adverse Effect” means (a) a material adverse effect on the
business, assets, liabilities, operations, condition (financial or otherwise) or operating
results of the Guarantors taken as a whole, the result of which is a material impairment of
the ability of the Guarantors taken as a whole to perform their respective obligations under
any Loan Document, (b) a material impairment of the totality of rights and remedies of, or
benefits available to, any Secured Party under the Loan Documents or (c) a material adverse
effect on the value of the Collateral taken as a whole.




          “Holdco I” has the meaning specified in the first paragraph to this Agreement.




          “Holdco I Cash Collateral Account” has the meaning specified in the Preliminary
Statements to this Agreement.




          “Holdco I DACA” shall mean the Deposit Account Control Agreement, among Holdco I,
Agent, and the relevant depositary bank, in form and substance



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reasonably satisfactory to Holdco I, Agent and the relevant depositary bank.





          “Indemnified Party” has the meaning specified in Section 6.04.




          “Indenture” means the Indenture, dated as of August 1, 2006, between the Company and
Deutsche Bank Trust Company Americas, as trustee, as amended, supplemented or otherwise
modified from time to time.




          “Initial Parent Holdco” has the meaning specified in the first paragraph to this
Agreement.




          “Initial Parent Holdco (California)” has the meaning specified in the first paragraph
to this Agreement.




          “Initial Parent Holdco (Ireland)” has the meaning specified in the first paragraph to
this Agreement.




          “Initial Pledged Equity” has the meaning specified in the Preliminary Statements to
this Agreement.




          “Initial Pledged Parent Holdco Equity” has the meaning specified in the Preliminary
Statements to this Agreement.




          “Initial Pledged SPE and Intermediate Lessee Equity” has the meaning specified in the
Preliminary Statements to this Agreement.




          “Intermediate Lessee” means each direct Wholly-owned Subsidiary (subject to the Local
Requirements Exception) of a Parent Holdco other than any Pledged SPE, all of whose issued
and outstanding Equity Interests constitute Collateral.




          “Irish Act” means the Irish Land and Conveyancing Law Reform Act 2009.




          “Obligation” means, with respect to any Person, any payment, performance or other
obligation of such Person of any kind, including, without limitation, any liability of such
Person on any claim, whether or not the right of any creditor to payment in respect of such
claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
disputed, undisputed, legal, equitable, secured or unsecured, and whether or not such claim is discharged, stayed or otherwise affected by any proceeding
referred to in Section 11.1.3 of the Credit Agreement. Without limiting the generality of
the foregoing, the Obligations of any Loan Party under the Loan Documents include (a) the
obligation to pay principal, interest, charges, expenses, fees, attorneys’ fees and
disbursements, indemnities and other amounts payable by such Loan Party under any Loan
Document and (b) the obligation of such Loan Party to reimburse any amount in respect of any
of the foregoing arising from or under any Loan Document that the Administrative Agent or
the Collateral Agent, in its sole discretion, may elect to pay or advance on behalf of such
Loan Party.



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          “Parent Holdco” means the Initial Parent Holdcos and any other direct Wholly-owned
Subsidiary (subject to the Local Requirements Exception) of Holdco I formed or acquired
after the date hereof, each of whom shall execute and deliver a Guarantee Supplement.




          “Permitted Holdco I Activities” means, with respect to Holdco I, (a) the execution,
delivery and performance of its obligations under this Agreement or any other agreement or
document required by the terms of the Loan Documents, (b) the establishment, formation,
purchase, acquisition, holding, maintenance or permitted sale or other disposition of any
Parent Holdco, and (c) activities permitted or required under Sections 4 and 5 hereof, and
(d) all other activities incidental thereto or that are immaterial, including contracting
for management services from the Company, the incurrence and lending of intercompany
indebtedness and payments in respect thereof, and other activities and actions taken in
accordance with Leasing Company Practice.




          “Permitted Intermediate Lessee Activities” means, with respect to an Intermediate
Lessee, (a) the execution, delivery and performance of its obligations under any agreement
or document required by the terms of the Loan Documents, (b) the acquisition, ownership,
holding, conversion, maintenance, modification, management, operation, leasing, re-leasing,
subleasing and sale or other disposition of any Eligible Aircraft or related assets and the
entry into all agreements and engaging in all related activities incidental thereto,
including from time to time accepting, exchanging, holding promissory notes, contingent
payment obligations or Equity Interests of lessees or their Affiliates issued in connection
with the bankruptcy, reorganization or other similar process, or in settlement of delinquent
obligations or obligations anticipated to be delinquent, of such lessees or their respective
Affiliates, (c) activities permitted or required under Sections 4 and 5 hereof, and (d) all
other activities incidental thereto or that are immaterial, including contracting for
management services from the Company, Holdco I or a Parent Holdco, the incurrence and
lending of intercompany indebtedness and payments in respect thereof, and other activities
and actions taken in accordance with Leasing Company Practice.




          “Permitted Parent Holdco Activities” means, with respect to a Parent Holdco, (a) the
execution, delivery and performance of its obligations under this Agreement or any other agreement or document required by the terms of the Loan
Documents, (b) the establishment, formation, purchase, acquisition, holding, maintenance or
permitted sale or other disposition of any Pledged SPE or Intermediate Lessee,
(c) activities permitted or required under Sections 4 and 5 hereof, and (d) all other
activities incidental thereto or that are immaterial, including contracting for management
services from the Company or Holdco I, the incurrence and lending of intercompany
indebtedness and payments in respect thereof, and other activities and actions taken in
accordance with Leasing Company Practice.




          “Permitted Pledged SPE Activities” means, with respect to a Pledged SPE, (a) the
execution, delivery and performance of its obligations under any agreement or document
required by the terms of the Loan Documents, (b) the acquisition, ownership, holding,
conversion, maintenance, modification, management, operation,


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leasing, re-leasing, subleasing and sale or otherwise disposition of any Eligible
Aircraft or related assets and the entry into all agreements and engaging in all related
activities incidental thereto, including from time to time accepting, exchanging, holding
promissory notes, contingent payment obligations or Equity Interests of lessees or their
Affiliates issued in connection with the bankruptcy, reorganization or other similar
process, or in settlement of delinquent obligations or obligations anticipated to be
delinquent, of such lessees or their respective Affiliates, (c) activities permitted or
required under Sections 4 and 5 hereof, and (d) all other activities incidental thereto or
that are immaterial, including contracting for management services from the Company, Holdco
I or a Parent Holdco, the incurrence and lending of intercompany indebtedness and payments
in respect thereof, and other activities and actions taken in accordance with Leasing
Company Practice.





          “Pledged Debt” means all the Indebtedness from time to time owing by any Guarantor, any
Pledged SPE, any Intermediate Lessee or the Company to any Guarantor.




          “Pledged Debt Collateral” has the meaning specified in Section 5.01(a)(iii).




          “Pledged Equity” has the meaning specified in Section 5.01(a)(ii).




          “Pledged SPE” means each direct Wholly-owned Subsidiary (subject to the Local
Requirements Exception) of a Parent Holdco that Owns any Eligible Aircraft, all of whose
issued and outstanding Equity Interests constitute Collateral. Each Pledged SPE shall be
organized under the laws of Delaware, California, Utah, Ireland or any other jurisdiction
reasonably acceptable to the Collateral Agent.




          “Post Petition Interest” has the meaning specified in Section 2.08(b).




          “Receiver” means any one or more receivers and/or managers appointed by the Collateral
Agent in respect of each relevant Guarantor or over all or any part of the Irish Collateral.




          “Secured Obligations” has the meaning specified in Section 5.02.




          “Secured Parties” means the Agent and the 2012 Banks.




          “Security Collateral” has the meaning specified in Section 5.01(a).




          “Security Interest” means any mortgage, pledge, lien, charge, assignment, hypothecation
or right in security or security interest, trust arrangement for the purpose of providing
security, retention of title arrangement or any other agreement or arrangement having the
effect of conferring security.




          “Solvent” means, with respect to any Person on a particular date, that on such date (a)
the fair value of the property of such Person is greater than the total amount of
liabilities of such Person and (b) such Person is not and will not be rendered insolvent



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     as a result of the transactions contemplated by the Loan Documents.




          “Subagent” has the meaning specified in Section 5.11.




          “Subordinated Obligations” has the meaning specified in Section 2.08.




          “UCC” means the Uniform Commercial Code as in effect from time to time in the State of
New York; provided that, if perfection or the effect of perfection or non perfection or the
priority of the security interest in any Collateral is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than the State of New York, “UCC” means the
Uniform Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of perfection or non
perfection or priority.


          Section 1.02 Accounting Terms. All accounting terms not specifically defined herein shall
be construed in accordance with generally accepted accounting principles in the United States of
America.


          Section 1.03 Other Definitional Provisions. In this Agreement and each other Loan
Document, (a) in the computation of periods of time from a specified date to a later specified
date, (i) the word “from” means “from and including” and (ii) the words “to” and “until” each mean
“to but excluding”, (b) references to any agreement or contract “as amended” means and shall be a reference to such agreement or contract as amended, amended and
restated, supplemented or otherwise modified from time to time in accordance with its terms,
(c) terms defined in the Credit Agreement and not otherwise defined in this Agreement are used in
this Agreement as defined in the Credit Agreement, and unless otherwise defined in this Agreement
or in the Credit Agreement, terms defined in Article 8 or 9 of the UCC are used in this Agreement
as such terms are defined in such Article 8 or 9, (d) references to “writing” include printing,
typing, lithography and other means of reproducing words in a tangible visible form, (e) the words
“hereof”, “herein”, “hereunder” and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this Agreement, (f) Section,
Article, Schedule and Exhibit references contained in this Agreement are references to Sections,
Articles, Schedules and Exhibits in or to this Agreement unless otherwise specified and (g) the
term “including” shall mean “including without limitation”.



ARTICLE II

GUARANTEE



          Section 2.01 Guarantee; Limitation of Liability. (a) Each Guarantor hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled
maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all
Obligations of each other Loan Party to any Secured Party now or hereafter existing under or in
respect of the Loan Documents (including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing Obligations), whether direct
or indirect, absolute or contingent, and whether for principal, interest, premiums, fees,
indemnities, contract causes of action, costs, expenses or otherwise (such Obligations being the
“Guaranteed Obligations”), and agrees to pay any and all

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reasonable out-of-pocket expenses (including, without limitation, reasonable fees
and expenses of counsel) incurred by the Agent or any other Secured Party in enforcing any rights
under this Agreement or any other Loan Document. Without limiting the generality of the foregoing,
each Guarantor’s liability shall extend to all amounts that constitute part of the Guaranteed
Obligations and would be owed by any other Loan Party to any Secured Party under or in respect of
the Loan Documents but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving such other Loan
Party.



          (b) Each Guarantor, and by its acceptance of this Guarantee, the Agent and each other Secured
Party, hereby confirms that it is the intention of all such Persons that this Guarantee and the
Obligations of each Guarantor hereunder not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law (as hereinafter defined), the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent
applicable to this Guarantee and the Obligations of each Guarantor hereunder. To effectuate the
foregoing intention, the Agent, the other Secured Parties and the Guarantors hereby irrevocably
agree that the Obligations of each Guarantor under this Guarantee at any time shall be limited to
the maximum amount as will result in the Obligations of such Guarantor under this Guarantee not
constituting a fraudulent transfer or conveyance. For purposes hereof, “Bankruptcy Law” means any
proceeding of the type referred to in Section 11.1.3 of the Credit Agreement or Title 11, U.S.
Code, or any similar foreign, federal or state law for the relief of debtors.


          (c) Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment
shall be required to be made to any Secured Party under this Guarantee, such Guarantor will
contribute, to the maximum extent permitted by law, such amounts to each other Guarantor so as to
maximize the aggregate amount paid to the Secured Parties under or in respect of the Loan
Documents.


          Section 2.02 Guarantee Absolute. Each Guarantor hereby guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan Documents, regardless of
any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of any Secured Party with respect thereto. The Obligations of each Guarantor
under or in respect of this Guarantee are independent of the Guaranteed Obligations or any other
Obligations of any other Loan Party under or in respect of the Loan Documents, and a separate
action or actions may be brought and prosecuted against each Guarantor to enforce this Guarantee,
irrespective of whether any action is brought against any other Loan Party or whether any other
Loan Party is joined in any such action or actions. The liability of each Guarantor under this
Guarantee shall be irrevocable, absolute and unconditional irrespective of, and each Guarantor
hereby irrevocably waives any defenses (other than payment in full of the Guaranteed Obligations)
it may now have or hereafter acquire in any way relating to, any or all of the following:




     (a) any lack of validity or enforceability of any Loan Document or any agreement or
instrument relating thereto;




     (b) any change in the time, manner or place of payment of, or in any other term of, all
or any of the Guaranteed Obligations or any other Obligations of any other



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Loan Party under or in respect of the Loan Documents, or any other amendment or waiver
of or any consent to departure from any Loan Document, including, without limitation, any
increase in the Guaranteed Obligations resulting from the extension of additional credit to
any Loan Party or any of its Subsidiaries or otherwise;




     (c) any taking, exchange, release or non-perfection of any Collateral or any other
collateral, or any taking, release or amendment or waiver of, or consent to departure from,
any other guarantee, for all or any of the Guaranteed Obligations;




     (d) any manner of application of Collateral or any other collateral, or proceeds
thereof, to all or any of the Guaranteed Obligations, or any manner of sale or other
disposition of any Collateral or any other collateral for all or any of the Guaranteed
Obligations or any other Obligations of any Loan Party under the Loan Documents or any other
assets of any Loan Party or any of its Subsidiaries;




     (e) any change, restructuring or termination of the organizational structure or
existence of any Loan Party or any of its Subsidiaries;




     (f) any failure of any Secured Party to disclose to any Loan Party any information
relating to the business, condition (financial or otherwise), operations, performance,
properties or prospects of any other Loan Party now or hereafter known to such Secured Party
(each Guarantor hereby waiving any duty on the part of the Secured Parties to disclose such
information);




     (g) the failure of any other Person to execute or deliver this Agreement, any Guarantee
Supplement or any other guarantee or agreement or the release or reduction of liability of
any Guarantor or other guarantor or surety with respect to the Guaranteed Obligations; or




     (h) any other circumstance (including, without limitation, any statute of limitations)
or any existence of or reliance on any representation by any Secured Party that might
otherwise constitute a defense available to, or a discharge of, any Loan Party or any other
guarantor or surety (other than payment in full of the Guaranteed Obligations).


This Guarantee shall continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by any
Secured Party or any other Person upon the insolvency, bankruptcy or reorganization of the Company
or any other Loan Party or otherwise, all as though such payment had not been made.


          Section 2.03 Waivers and Acknowledgments. (a) Each Guarantor hereby unconditionally and
irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for
performance, notice of nonperformance, default, acceleration, protest or dishonor and any other
notice with respect to any of the Guaranteed Obligations and this Guarantee and any requirement
that any Secured Party protect, secure, perfect or insure any Lien or any property subject thereto
or exhaust any right or take any action against any Loan Party or any other Person or any
Collateral.




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          (b) Each Guarantor hereby unconditionally and irrevocably waives any right to revoke this
Guarantee and acknowledges that this Guarantee is continuing in nature and applies to all
Guaranteed Obligations, whether existing now or in the future.


          (c) Each Guarantor hereby unconditionally and irrevocably waives (i) any defense arising by
reason of any claim or defense based upon an election of remedies by any Secured Party that in any
manner impairs, reduces, releases or otherwise adversely affects the subrogation, reimbursement,
exoneration, contribution or indemnification rights of such Guarantor or other rights of such
Guarantor to proceed against any of the other Loan Parties, any other guarantor or any other Person
or any Collateral and (ii) any defense based on any right of set-off or counterclaim against or in
respect of the Obligations of such Guarantor hereunder.


          (d) Each Guarantor hereby unconditionally and irrevocably waives any duty on the part of any
Secured Party to disclose to such Guarantor any matter, fact or thing relating to the business,
condition (financial or otherwise), operations, performance, properties or prospects of any other
Loan Party or any of its Subsidiaries now or hereafter known by such Secured Party.


          (e) Each Guarantor acknowledges that it will receive substantial direct and indirect benefits
from the financing arrangements contemplated by the Loan Documents and that the waivers set forth
in Section 2.02 and this Section 2.03 are knowingly made in contemplation of such benefits.


          Section 2.04 Subrogation. Each Guarantor hereby unconditionally and irrevocably
agrees not to exercise any rights that it may now have or hereafter acquire against the Company,
any other Guarantor or any other insider guarantor that arise from the existence, payment,
performance or enforcement of such Guarantor’s Obligations under or in respect of any Loan
Document, including, without limitation, any right of subrogation, reimbursement, exoneration,
contribution or indemnification and any right to participate in any claim or remedy of any Secured
Party against the Company, any other Guarantor or any other insider guarantor or any Collateral,
whether or not such claim, remedy or right arises in equity or under contract, statute or common
law, including, without limitation, the right to take or receive from the Company, any other
Guarantor or any other insider guarantor, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim, remedy or right,
while any Event of Default has occurred and is continuing, unless and until all of the Guaranteed
Obligations and all other amounts payable under this Guarantee shall have been paid in full in cash
and the 2012 Commitments shall have expired or been terminated. If any amount shall be paid to any
Guarantor in violation of the immediately preceding sentence at any time, while any Event of
Default has occurred and is continuing, prior to the payment in full in cash of the Guaranteed
Obligations and all other amounts payable under this Article II and termination or expiration of
the 2012 Commitments, such amount shall be received and held in trust for the benefit of the
Secured Parties, shall be segregated from other property and funds of such Guarantor and shall
forthwith be paid or delivered to the Agent in the same form as so received (with any necessary
endorsement or assignment) to be credited and applied to the Guaranteed Obligations and all other
amounts payable under this Guarantee, whether matured or unmatured, in accordance with the terms of
the Loan Documents, or to be held as Collateral for any Guaranteed Obligations or other amounts
payable under this Guarantee thereafter arising. If



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(i) any Guarantor shall make payment to any Secured Party of all or any part of the
Guaranteed Obligations, (ii) all of the Guaranteed Obligations and all other amounts payable under
this Guarantee shall have been paid in full in cash, and (iii) the 2012 Commitments shall have been
terminated or expired, the Secured Parties will, at such Guarantor’s request and expense, execute
and deliver to such Guarantor appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to such Guarantor of an interest in the
Guaranteed Obligations resulting from such payment made by such Guarantor pursuant to this Article
II.


          Section 2.05 Continuing Guarantee. This Guarantee is a continuing guarantee and shall (a)
remain in full force and effect until payment in full in cash of the Guaranteed Obligations and all
other amounts payable under this Agreement and termination or expiration of the 2012 Commitments,
or, with respect to any Parent Holdco, the sale, transfer or other disposition of such Parent
Holdco in accordance with the terms of the Loan Documents, (b) be binding upon each Guarantor, its
successors and assigns and (c) inure to the benefit of and be enforceable by the Secured Parties
and their successors, transferees and assigns.


          Section 2.06 Payments Free and Clear of Taxes, Etc. Section 6.4 of the Credit Agreement
shall apply to this Agreement mutatis mutandis.


          Section 2.07 Right of Set-off. Upon (a) the occurrence and during the continuance of any
Event of Default and (b) the making of the request referred to in Section 11.2 of the Credit
Agreement to authorize the Agent to declare the Loans due and payable pursuant to the provisions of
said Section 11.2, each Secured Party and each of their respective Affiliates is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Secured Party or such Affiliate to or for the credit
or the account of any Guarantor against any and all of the Obligations of such Guarantor now or
hereafter existing under the Loan Documents, irrespective of whether such Secured Party shall have
made any demand under this Agreement or any other Loan Document and although such Obligations may
be unmatured. Each Secured Party agrees promptly to notify such Guarantor after any such set-off
and application; provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Secured Party and their respective
Affiliates under this Section 2.07 are in addition to other rights and remedies (including, without
limitation, other rights of set off) that such Secured Party and their respective Affiliates may
have.


          Section 2.08 Subordination. Each Guarantor hereby subordinates any and all debts,
liabilities and other Obligations owed to such Guarantor by each other Loan Party (the
“Subordinated Obligations”) to the Guaranteed Obligations to the extent and in the manner
hereinafter set forth in this Section 2.08:


          (a) Prohibited Payments, Etc. Except during the continuance of any Event of Default
(including the commencement and continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), each Guarantor may receive payments from any other Loan Party on account of
the Subordinated Obligations. After the occurrence and during the continuance of any Event of
Default (including the commencement and continuation of any



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proceeding under any Bankruptcy Law relating to any other Loan Party), however, unless the
Agent otherwise agrees, no Guarantor shall demand, accept or take any action to collect any payment
on account of the Subordinated Obligations.


          (b) Prior Payment of Guaranteed Obligations. In any proceeding under any Bankruptcy
Law relating to any other Loan Party, each Guarantor agrees that the Secured Parties shall be
entitled to receive payment in full in cash of all Guaranteed Obligations (including all interest
and expenses accruing after the commencement of a proceeding under any Bankruptcy Law, whether or
not constituting an allowed claim in such proceeding (“Post Petition Interest”)) before such
Guarantor receives payment of any Subordinated Obligations.


          (c) Turn-Over. After the occurrence and during the continuance of any Event of
Default (including the commencement and continuation of any proceeding under any Bankruptcy Law
relating to any other Loan Party), each Guarantor shall, if the Agent so requests, collect, enforce
and receive payments on account of the Subordinated Obligations as trustee for the Secured Parties
and deliver such payments to the Agent on account of the Guaranteed Obligations (including all Post
Petition Interest), together with any necessary endorsements or other instruments of transfer.


          (d) Agent Authorization. After the occurrence and during the continuance of any Event
of Default (including the commencement and continuation of any proceeding under any Bankruptcy Law
relating to any other Loan Party), the Agent is authorized and empowered (but without any
obligation to so do), in its discretion, (i) in the name of each Guarantor, to collect and enforce,
and to submit claims in respect of, Subordinated Obligations and to apply any amounts received
thereon to the Guaranteed Obligations (including any and all Post Petition Interest), and (ii) to
require each Guarantor (A) to collect and enforce, and to submit claims in respect of, Subordinated
Obligations and (B) to pay any amounts received on such obligations to the Agent for application to
the Guaranteed Obligations (including any and all Post Petition Interest).



ARTICLE III


REPRESENTATIONS AND WARRANTIES



          Section 3.01 Representations and Warranties of each Guarantor. Each Guarantor represents
and warrants to each of the Secured Parties as follows:




     (a) Such Guarantor is an entity duly organized or incorporated and validly existing
under the laws of its jurisdiction of organization or incorporation, and has the
corporation, trust or other power to own its property and carry on its business as now being
conducted and is duly qualified and in good standing, if applicable, as a foreign
corporation or other entity authorized to do business in each jurisdiction where, because of
the nature of its activities or properties, such qualification is required, except where the
failure to be so qualified or in good standing could not reasonably be expected to have a
Guarantor Material Adverse Effect.




     (b) The execution and delivery by such Guarantor of this Agreement and the performance
by such Guarantor of its obligations hereunder (i) are within the corporate,




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trust or other powers of such Guarantor, (ii) have been duly authorized by all
necessary corporate, trust or other action on the part of such Guarantor, (iii) have
received all necessary approvals, authorizations, consents, registrations, notices,
exemptions and licenses (if any shall be required) from Governmental Authorities and other
Persons, except for any such approvals, authorizations, consents, registrations, notices,
exemptions or licenses non-receipt of which could not reasonably be expected to have a
Guarantor Material Adverse Effect, (iv) do not and will not contravene or conflict with any
provision of (A) law, (B) any judgment, decree or order to which such Guarantor or any of
its Subsidiaries is a party or by which such Guarantor or any of its Subsidiaries is bound,
(C) the charter, bylaws, constitutional or other organizational documents of such Guarantor
or any of its Subsidiaries, or (D) any provision of (1) the Indenture (including, without
limitation, Sections 1006, 1007, 1008 and 1009 thereof) or (2) any other agreement or
instrument binding on such Guarantor or any of its Subsidiaries, or any agreement or
instrument of which such Guarantor is aware affecting the properties of such Guarantor or
any of its Subsidiaries, except with respect to (A), (B) and (D) above, for any such
contravention or conflict which could not reasonably be expected to have a Material Adverse
Effect, and (v) do not and will not result in or require the creation or imposition of any
Lien on any of such Guarantor’s or its Subsidiaries’ properties other than the Lien in favor
of the Agent for the benefit of the Secured Parties in the Collateral granted under this
Agreement and Permitted Collateral Liens.




     (c) This Agreement is the legal, valid and binding obligation of such Guarantor,
enforceable against such Guarantor in accordance with its terms, subject to bankruptcy,
insolvency, examinorship, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors’ rights and to general equity
principles.




     (d) Such Guarantor is not an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, required to register thereunder, or a company “controlled”
by an “investment company” within the meaning of the Investment Company Act of 1940, as
amended.




     (e) Such Guarantor maintains insurance with insurers or reinsurers of recognized
responsibility or pursuant to governmental indemnities, to such extent and against such
hazards and liabilities as is commonly maintained, or caused to be maintained, as the case
may be, by companies similarly situated. Each Pledged SPE maintains, or, in the case of any
property Owned by such Pledged SPE and leased to lessees, such Pledged SPE (or the
applicable Intermediate Lessee) has contractually required such lessees to maintain,
insurance with insurers or reinsurers of recognized responsibility or pursuant to
governmental indemnities, covering such risks and in such amounts as set forth in Schedule
4.01(f).




     (f) Such Guarantor has, independently and without reliance upon any Secured Party and
based on such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and each other Loan Document to which it
is or is to be a party, and such Guarantor has established adequate means of obtaining from
each other Loan Party on a continuing basis information



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pertaining to, and is now and on a continuing basis will be completely familiar with,
the business, condition (financial or otherwise), operations, performance, properties and
prospects of such other Guarantor.




     (g) The Guarantors will be, as of the Collateral Value Effective Date and on each
Appraisal Date thereafter, together with their respective Subsidiaries, taken as a whole,
Solvent.




     (h) Holdco I is a direct Wholly-owned Subsidiary of the Company, each Parent Holdco is
a direct Wholly-owned Subsidiary of Holdco I and each Pledged SPE and each Intermediate
Lessee is a direct Wholly-owned Subsidiary of a Parent Holdco.




     (i) Each Pledged SPE Owns any Eligible Aircraft specified as being Owned by it free and
clear of all Liens other than Permitted Collateral Liens.




     (j) In each case, since the date of such Person’s organization, (i) Holdco I has not
engaged in any activity other than Permitted Holdco I Activities, (ii) each Parent Holdco
has not engaged in any activity other than Permitted Parent Holdco Activities, (iii) each
Pledged SPE has not engaged in any activity other than Permitted Pledged SPE Activities, and
(iv) each Intermediate Lessee has not engaged in any activity other than Permitted
Intermediate Lessee Activities.


          Section 3.02 Additional Representations and Warranties of the Guarantors. Each Guarantor
represents and warrants to each of the Secured Parties as follows:




     (a) Such Guarantor’s exact legal name, as defined in Section 9-503(a) of the UCC, is
correctly set forth in Schedule I hereto. Such Guarantor is located (within the meaning of
Section 9-307 of the UCC) and has its chief executive office in the state or jurisdiction
set forth in Schedule I hereto. The information set forth in Schedule I hereto with respect
to such Guarantor is true and accurate in all respects. Such Guarantor has not previously
changed its name, location, chief executive office, type of organization or incorporation,
as applicable, jurisdiction of organization or incorporation, as applicable, or
organizational or incorporation identification number from those set forth in Schedule I
hereto except as disclosed in Schedule III hereto.




     (b) All Security Collateral consisting of certificated securities and instruments
existing as of the date hereof (or, with respect to any other date on which this
representation is made, repeated, brought down or otherwise deemed made, existing as of such
date) has been delivered to the Agent.




     (c) Such Guarantor is the legal and beneficial owner of the Collateral of such
Guarantor free and clear of any Lien, claim, option or right of others, except for the
security interest created under this Agreement or Permitted Collateral Liens. No effective
financing statement or other instrument similar in effect covering all or any part of such
Collateral or listing such Guarantor as debtor with respect to such Collateral is on file in
any recording office, except such as may have been filed in favor of the Agent relating to
the Loan Documents, or otherwise with respect to Permitted Collateral Liens.



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     (d) The Pledged Equity pledged by such Guarantor hereunder has been duly authorized and
validly issued and is fully paid and non assessable. With respect to any Pledged Equity
that is an uncertificated security issued by an issuer organized under the laws of the
United States or any State thereof, such Guarantor has caused such issuer either (i) to
register the Agent as the registered owner of such security or (ii) to agree in an
authenticated record with such Guarantor and the Agent that such issuer will comply with
instructions with respect to such security originated by the Agent without further consent
of such Guarantor (and, for the avoidance of doubt, such issuer will not comply with any
such instructions originated by such Guarantor only upon the occurrence and during the
continuance of an Event of Default). If any Security Collateral issued by an issuer
organized under the laws of the United States or any State thereof is not a security
pursuant to Section 8-103 of the UCC, no Guarantor shall take any action that, under such
Section 8-103, converts such Security Collateral into a security without causing the issuer
thereof to issue to it certificates or instruments evidencing such Security Collateral,
which it shall deliver to the Agent as provided in Section 5.03. If such Guarantor is an
issuer of Pledged Equity, such Guarantor confirms that it has received notice of the
security interest granted under this Agreement.




     (e) The Initial Pledged Equity pledged by such Guarantor constitutes the percentage of
the issued and outstanding Equity Interests of the issuers thereof indicated on Schedule II
hereto.




     (f) All filings and other actions (including without limitation, actions necessary to
obtain control of Collateral as provided in Sections 9-104 or 9-106 of the UCC) necessary to
perfect the security interest in the Collateral of such Guarantor created under this
Agreement existing on the date hereof (or, with respect to any other date on which this
representation is made, repeated, brought down or otherwise deemed made, existing as of such
date) have been duly made or taken and are in full force and effect, or will be taken within
the required time periods as set out by applicable laws outside of the United States, and
this Agreement creates in favor of the Agent for the benefit of the Secured Parties a valid
and, together with such filings and other actions, perfected first priority security
interest in the Collateral of such Guarantor existing on the date hereof (or, with respect
to any other date on which this representation is made, repeated, brought down or otherwise
deemed made, existing as of such date), securing the payment of the Secured Obligations,
except for Permitted Collateral Liens.




     (g) Except for such authorizations and approvals listed on Schedule 3.02(g) hereto,
which have been obtained and remain in full force and effect as of the date hereof, no
authorization or approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body of the United States or any State thereof (or in
the case of the Equity Interests of Initial Parent Holdco (Ireland), Ireland) or any other
third party is required for (i) the grant by such Guarantor of the security interest granted
hereunder or for the execution, delivery or performance of this Agreement by such Guarantor,
(ii) the perfection or maintenance of the security interest created hereunder (including the
first priority nature of such security interest as contemplated hereby), except for the
filing of financing and continuation statements under the UCC and certain filings in Ireland
that will be made within 21 days after the date hereof, and the actions



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required to be taken pursuant to Section 5.03 with respect to Security Collateral,
which actions have been taken and are in full force and effect in respect of Security
Collateral existing on the date hereof (or, with respect to any other date on which this
representation is made, repeated, brought down or otherwise deemed made, existing as of such
date) or (iii) the exercise by the Agent of its voting or other rights provided for in this
Agreement or the remedies in respect of the Collateral pursuant to this Agreement, except as
may be required in connection with the disposition of any portion of the Security Collateral
by laws affecting the offering and sale of securities generally or any other applicable
laws.



ARTICLE IV


COVENANTS



          Section 4.01 Covenants. Each Guarantor covenants and agrees that, so long as any part of
the Guaranteed Obligations shall remain unpaid or any 2012 Bank shall have any 2012 Commitment,
such Guarantor will perform and observe, and cause each of its Subsidiaries to perform and observe,
all of the terms, covenants and agreements set forth in the Loan Documents on its or their part to
be performed or observed or that the Company has agreed to cause such Guarantor or such
Subsidiaries, as applicable, to perform or observe, and in addition, each Guarantor agrees
that:




     (a) Separate Existence. Each Guarantor shall, and shall cause each of its
Subsidiaries to, maintain its existence as a separate corporation, trust or other Person for
the sole purpose of (i) in the case of each Pledged SPE, owning, leasing and disposing of
the Eligible Aircraft and activities incidental thereto and other Permitted Intermediate
Lessee Activities, (ii) in the case of each Intermediate Lessee, leasing the Eligible
Aircraft and activities incidental thereto and other Permitted Pledged SPE Activities, and
(iii) in the case of each Guarantor, holding and disposing of the assets contemplated to be
held hereunder and entering into the Loan Documents and the transactions contemplated
thereby and activities incidental thereto and, in the case of Holdco I, Permitted Holdco I
Activities. Each Guarantor shall, and shall cause each of its Subsidiaries to, maintain
certain policies and procedures relating to its separateness, including, (x) maintaining its
own books and records (other than any Guarantor, Pledged SPE or Intermediate Lessee which is
a trust) and maintaining its assets and liabilities in such a manner that it is not
difficult to segregate, identify or ascertain such assets and liabilities from those of the
Company, other Guarantors, other Pledged SPEs, other Intermediate Lessees or any other
Person, and (y) holding itself out to creditors and the public as a legal entity (other than
any trust) separate and distinct from the Company, other Guarantors, other Pledged SPEs,
other Intermediate Lessees or any other Person (except for consolidated tax returns,
financial statements and similar reports). For the avoidance of doubt, the Company (or a
Subsidiary thereof) may act as a “servicer” to any Guarantor or any Subsidiary thereof and
in such capacity may perform, or cause to be performed, leasing, administration, sale,
aircraft and equipment maintenance and related services on behalf of such Guarantor or such
Subsidiary.




     (b) Limitation on Indebtedness. No Guarantor may, and may not permit any of
its Pledged SPEs or Intermediate Lessees to, incur, create, issue, assume, guarantee or
otherwise become liable for or with respect to, or become responsible for, the payment



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of, contingently or otherwise, whether present or future, any Indebtedness other than
(i) in the case of the Guarantors, Indebtedness in respect of the Guarantee hereunder, (ii)
leases and obligations to lessees, trustees and others under the leases, trust agreements
and other documents related thereto, including any Indebtedness owed to any lessee under any
such agreement or the lease with respect to maintenance contributions, redelivery condition
adjustment payments or any other obligation of any Guarantor, Pledged SPE or Intermediate
Lessee to a lessee, in each case that is incurred in accordance with Leasing Company
Practice; (iii) Indebtedness of any Guarantor, Pledged SPE or Intermediate Lessee owed to
the Company or any of its Subsidiaries; provided that, no such Indebtedness shall be
permitted unless (x) such Indebtedness has been subordinated to the Guaranteed Obligations
on the terms set forth herein or, to the extent such terms are not applicable, on terms
reasonably acceptable to the Collateral Agent, and (y) in the case of any Pledged Debt
Collateral, the Collateral Agent has a first priority perfected security interest in such
Pledged Debt Collateral, subject to Permitted Collateral Liens, and such Pledged Debt
Collateral is, or when issued, will be, evidenced by an instrument which has been delivered
and indorsed to the Collateral Agent; (iv) Indebtedness required in connection with
repossession of an Aircraft or any engine related thereto; and (v) Indebtedness in favor of
the issuer of a surety, letter of credit or similar instrument to be obtained by any
Guarantor, Pledged SPE or Intermediate Lessee in connection with the repossession or
detention of an Aircraft or other enforcement action under a lease.




     (c) Permitted Activities. (i) Holdco I shall not engage in any activity other
than Permitted Holdco I Activities, (ii) each Parent Holdco shall not engage in any activity
other than Permitted Parent Holdco Activities, (iii) each Pledged SPE shall not engage in
any activity other than Permitted Pledged SPE Activities, and (iv) each Intermediate Lessee
shall not engage in any activity other than Permitted Intermediate Lessee Activities.




     (d) Equity Interests Ownership. Holdco I shall at all times remain a direct
Wholly-owned Subsidiary of the Company, each Parent Holdco shall at all times remain a
direct Wholly-owned Subsidiary of Holdco I (unless transferred in accordance with the Credit
Agreement) and each Pledged SPE and each Intermediate Lessee shall at all times remain a
direct Wholly-owned Subsidiary of a Parent Holdco, in each case subject to the Local
Requirements Exception, it being understood that Holdco I and any Parent Holdco may sell or
otherwise dispose of the Equity Interests of a Parent Holdco, a Pledged SPE, as the case may
be, in accordance with Section 9.9, Section 9.18 and Section 9.19 of the Credit Agreement
and Section 5.14 of this Agreement, and that, in connection with any permitted sale or other
disposal of the Equity Interests of any Pledged SPE, such Parent Holdco may sell or
otherwise dispose of any Intermediate Lessee leasing any Eligible Aircraft Owned by such
Pledged SPE, provided that such Intermediate Lessee is not, at the time of such sale or
other disposal, leasing any Eligible Aircraft Owned by any other Pledged SPE.




     (e) No Other Subsidiaries. Holdco I shall not have any subsidiaries other than
Parent Holdcos, Pledged SPEs and Intermediate Lessees.



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     (f) Insurance. Each Guarantor shall maintain insurance with insurers or
reinsurers of recognized responsibility or pursuant to governmental indemnities, to such
extent and against such hazards and liabilities as is commonly maintained, or caused to be
maintained, as the case may be, by companies similarly situated. Each Pledged SPE shall
maintain, or, in the case of any property Owned by such Pledged SPE and leased to lessees,
such Pledged SPE (or the applicable Intermediate Lessee) has contractually required such
lessees to maintain, insurance with insurers or reinsurers of recognized responsibility or
pursuant to governmental indemnities, covering such risks and in such amounts as set forth
in Schedule 4.01(f).




     (g) Additional Parent Holdcos. Each Parent Holdco formed or acquired after the
date hereof shall, and each Guarantor shall cause such Parent Holdco to, execute and deliver
a Guarantee Supplement promptly upon the formation or acquisition of such Parent Holdco.
Each Parent Holdco shall deliver to the Agent updated schedules to this Agreement promptly
upon formation or acquisition by such Parent Holdco of any Pledged SPE or Intermediate
Lessee.



ARTICLE V

GRANT OF SECURITY INTEREST; REMEDIES




          Section 5.01 Grant of Security Interest. Each Guarantor hereby grants to the Agent, for
the ratable benefit of the Secured Parties, a security interest in such Guarantor’s right, title
and interest in and to the following, in each case, as to each type of property described below,
whether now owned or hereafter acquired by such Guarantor, wherever located, and whether now or
hereafter existing or arising (collectively, the “Collateral”):




          (a) the following (the “Security Collateral”):





     (i) the Initial Pledged Equity and the certificates, if any, representing the
Initial Pledged Equity, and all dividends, distributions, return of capital, cash,
instruments and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the Initial Pledged
Equity and all subscription warrants, rights or options issued thereon or with
respect thereto;




     (ii) all additional shares of stock and other Equity Interests from time to
time acquired by such Guarantor in any manner (such shares and other Equity
Interests, together with the Initial Pledged Equity, being the “Pledged Equity”),
and the certificates, if any, representing such additional shares or other Equity
Interests, and all dividends, distributions, return of capital, cash, instruments
and other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such shares or other Equity Interests
and all subscription warrants, rights or options issued thereon or with respect
thereto; and




     (iii) the Pledged Debt and all instruments evidencing the Pledged Debt, and all
interest, cash, instruments and other property from time to time received,



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receivable or otherwise distributed in respect of or in exchange for any or all
of the Pledged Debt (the “Pledged Debt Collateral”).




(b) the following (collectively, the “Account Collateral”):




     (i) the Cash Collateral Accounts and in each case all funds and financial
assets from time to time deposited therein or credited thereto (including, without
limitation, all Cash Equivalents), and all certificates and instruments, if any,
from time to time representing or evidencing the Cash Collateral Account;




     (ii) all promissory notes, certificates of deposit, checks and other
instruments from time to time delivered to or otherwise possessed by the Agent for
or on behalf of such Guarantor in substitution for or in addition to any or all of
the then existing Account Collateral; and




     (iii) all interest, dividends, distributions, cash, instruments and other
property from time to time received, receivable or otherwise distributed in respect
of or in exchange for any or all of the then existing Account Collateral; and




     (c) all proceeds of, collateral for, income and other payments now or hereafter due and
payable with respect to, and supporting obligations relating to, any and all of the
Collateral (including, without limitation, proceeds, collateral and supporting obligations
that constitute property of the types described in clauses (a) and (b) of this Section 5.01
and this clause (c)) and, to the extent not otherwise included, all (i) payments under
insurance (whether or not the Agent is the loss payee thereof), or any indemnity, warranty
or guarantee, payable by reason of loss or damage to or otherwise with respect to any of the
foregoing Collateral and (ii) cash;


provided, however, that notwithstanding any of the foregoing provisions, so long as
no Event of Default shall have occurred and be continuing, the Company and each Guarantor shall
have the right, to the exclusion of the Agent, to (i) all distributions, cash, instruments and
other property from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Security Collateral (other than the Pledged Debt), (ii) all
interest, cash, instruments and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the Pledged Debt, and (iii) subject to
satisfaction of the conditions for the release of such Collateral set forth in Section 5.04(b)
hereof, the Account Collateral (and once paid in accordance with such Section 5.04(b) shall be free
and clear of the Lien hereof and shall not constitute Collateral).




          Section 5.02 Security for Obligations. In the case of each Guarantor, the grant of the
security interest set forth in Section 5.01 is made to the Agent to secure, for the ratable benefit
of the Secured Parties, payment in full in cash when due of all Obligations of such Guarantor and
each other Loan Party to any Secured Party, now or hereafter existing under this Agreement and the
other Loan Documents, whether direct or indirect, absolute or contingent, and whether for
principal, reimbursement obligations, interest (including interest on such obligations accruing
after, and fees and expenses arising after, the commencement of any proceeding under Title 11 of
the United States Code or any similar proceeding under state or federal law for the





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dissolution, restructuring, reorganization, liquidation or the winding up of such
Guarantor or such Loan Party, regardless of whether such interest, fees, or expenses are allowed as
a claim against such Guarantor or such Loan Party in any such proceeding), fees, premiums,
penalties, indemnifications, contract causes of action, costs, expenses in accordance with Section
6.04(a) or otherwise. The obligations of the Guarantors and the other Loan Parties described in
this Section 5.02 are referred to herein, collectively, as the “Secured Obligations”.




          Section 5.03 Delivery and Control of Security Collateral.




          (a) All certificates or instruments representing or evidencing Security Collateral shall be
delivered to and held by or on behalf of the Agent pursuant hereto and shall be in suitable form
for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank and undated, all in form and substance reasonably satisfactory to the Agent.
The Agent shall have the right, at any time after the occurrence and during the continuance of an
Event of Default, in its discretion and without notice to any Guarantor, to transfer to or to
register in the name of the Agent or any of its nominees any or all of the Security Collateral,
subject only to the revocable rights specified in Section 5.07(a). In addition, the Agent shall
have the right at any time after the occurrence and during the continuance of an Event of Default
to exchange certificates or instruments representing or evidencing Security Collateral for
certificates or instruments of smaller or larger denominations.




          (b) With respect to any Security Collateral in which any Guarantor has any right, title or
interest and that constitutes an uncertificated security issued by an issuer organized under laws
of the Untied States or any State thereof, such Guarantor will cause the issuer thereof either (i)
to register the Agent as the registered owner of such security or (ii) to agree in an authenticated
record with such Guarantor and the Agent that such issuer will comply with instructions with
respect to such security originated by the Agent without further consent of such Guarantor (and,
for the avoidance of doubt, such issuer will not comply with any such instructions originated by
such Guarantor only upon the occurrence and during the continuance of an Event of Default), such
authenticated record to be in form and substance reasonably satisfactory to the Agent. If any
Security Collateral is not a security pursuant to Section 8-103 of the UCC, no Guarantor shall take
any action that, under such Section, converts such Security Collateral into a security without
causing the issuer thereof to issue to it certificates or instruments evidencing such Security
Collateral, which it shall deliver to the Agent as provided in this Section 5.03.




          (c) With respect to any Security Collateral in which any Guarantor has any right, title or
interest and that is not a security pursuant to Section 8-103 of the UCC, upon the request of the
Agent upon the occurrence and during the continuance of an Event of Default, such Guarantor will
notify the issuer of such Security Collateral that such Security Collateral is subject to the
security interest granted hereunder.




          Section 5.04 The Account Collateral. (a) Until payment in full in cash of the
Secured Obligations and termination or expiration of the 2012 Commitments, (A) Holdco I shall
maintain the Holdco I Cash Collateral Account and shall maintain the Holdco I DACA in full force
and effect, and (B) the Agent may, at any time and without notice to, or consent from,





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Holdco I transfer, or direct the transfer of, funds from the Holdco I Cash Collateral
Account to satisfy the Secured Obligations if an Event of Default shall have occurred and be
continuing.




          (b) So long as no Event of Default shall have occurred and be continuing, if Holdco I shall
have Cash Collateralized the Secured Obligations pursuant to and in accordance with Section 13.8(a)
of the Credit Agreement and thereafter the aggregate Aircraft Value of the Eligible Aircraft Owned
by the Pledged SPEs, determined in accordance with the three Appraisal Reports by the Appraisers
most recently delivered to the Agent pursuant to Section 9.17 of the Credit Agreement, exceeds the
Required Collateral Amount (or the Minimum Required Collateral Amount if such determination is made
prior to the Collateral Value Effective Date) as set forth in a Required Collateral Determination
Certificate delivered to the Agent, the relevant depositary bank shall pay and release to Holdco I
or to Holdco I’s order or, at the request of the Company, to the Agent to be applied to the Secured
Obligations, such amount, if any, as is then on deposit in the Holdco I Cash Collateral Account as
requested, provided that, after giving effect to such payment and release, the Aggregate Collateral
Value shall not be less than the Required Collateral Amount (or the Minimum Required Collateral
Amount if such determination is made prior to the Collateral Value Effective Date), as certified by
the Company in a Required Collateral Determination Certificate delivered to the Agent.




          (c) If the Company shall be required to prepay and permanently reduce Committed Loans pursuant
to Section 13.8(a)(iv)(B) of the Credit Agreement, the Agent may, not earlier than the last day
required for such prepayment and permanent reduction unless otherwise agreed by the Company, upon
notice to the Company and Holdco I, charge, set off and otherwise apply all or any part of the
amount required to be so prepaid pursuant to such Section against any funds held with respect to
the Account Collateral.




          Section 5.05 Further Assurances.




          (a) Each Guarantor agrees that from time to time it will, at its own expense, promptly execute
and deliver, or otherwise authenticate, all further instruments and documents, and take all further
action that may be necessary, or that the Agent may reasonably request and that are necessary, in
order to perfect and protect any pledge or security interest granted or purported to be granted by
such Guarantor hereunder or to enable the Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the foregoing, each
Guarantor will, promptly with respect to Collateral of such Guarantor: (i) if any such Collateral
shall be evidenced by a promissory note or other instrument, deliver and pledge to the Agent
hereunder such note or instrument duly indorsed and accompanied by duly executed instruments of
transfer or assignment, all in form reasonably satisfactory to the Agent; (ii) at the Agent’s
request, file such financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary, or as the Agent may reasonably request and that are
necessary, in order to perfect and preserve the security interest granted or purported to be
granted by such Guarantor hereunder; (iii) deliver and pledge to the Agent for benefit of the
Secured Parties certificates representing Security Collateral that constitutes certificated
securities, accompanied by undated stock or note powers executed in blank; (iv) at the Agent’s
request, take all action necessary to ensure that the Agent has control of Collateral consisting of
investment property as provided in Section 9-106 of the UCC; and (v) deliver to the Agent evidence
that all other action that the Agent may deem





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reasonably necessary in order to perfect and protect the security interest created by such
Guarantor under this Agreement has been taken.




          (b) Each Guarantor hereby authorizes the Agent to file one or more financing or continuation
statements, and amendments thereto, in each case without the signature of such Guarantor. A
photocopy or other reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement where permitted by law.
Each Guarantor ratifies its authorization for the Agent to have filed such financing statements,
continuation statements or amendments filed prior to the date hereof.




          (c) Each Guarantor will furnish to the Agent from time to time statements and schedules
further identifying and describing the Collateral and such other reports in connection with such
Collateral as the Agent may reasonably request, all in reasonable detail.




          Section 5.06 Post-Closing Changes. No Guarantor will change its name, type of
organization or incorporation, as applicable, jurisdiction of organization or incorporation, as
applicable, organizational or incorporation identification number or location from those set forth
in Section 3.02(a) without first giving at least 30 days’ (or such shorter period of time
acceptable to Agent) prior written notice to the Agent and taking all action reasonably required by
the Agent for the purpose of perfecting or protecting the security interest granted by this
Agreement. Each Guarantor will hold and preserve its records relating to the Collateral and will
permit representatives of the Agent at any time during normal business hours to inspect and make
abstracts from such records and other documents. If any Guarantor does not have an organizational
identification number and later obtains one, it will promptly notify the Agent of such
organizational identification number.




          Section 5.07 Voting Rights; Dividends; Etc. (a) So long as no Event of Default
shall have occurred and be continuing:





     (i) Each Guarantor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Security Collateral of such Guarantor or any
part thereof for any purpose; provided, however, that such Guarantor will not
exercise or refrain from exercising any such right if such action would constitute a
breach of a Loan Document.




     (ii) Each Guarantor shall be entitled to receive and retain any and all
dividends, interest and other distributions paid in respect of the Security
Collateral of such Guarantor if and to the extent that the payment thereof is not
otherwise prohibited by the terms of the Loan Documents; provided, however, that
after an Event of Default has occurred and is continuing any and all




     (A) dividends, interest and other distributions paid or payable other
than in cash in respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange for, any
Security Collateral,




     (B) dividends and other distributions paid or payable in cash in
respect of any Security Collateral in connection with a partial or total



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liquidation or dissolution or in connection with a reduction of
capital, capital surplus or paid in surplus and




     (C) cash paid, payable or otherwise distributed in respect of principal
of, or in redemption of, or in exchange for, any Security Collateral




shall be, and shall be forthwith delivered to the Agent to hold as, Security
Collateral and shall, if received by such Guarantor, be received in trust for the
benefit of the Agent, be segregated from the other property or funds of such
Guarantor and be forthwith delivered to the Agent as Security Collateral in the same
form as so received (with any necessary indorsement).




     (iii) The Agent will execute and deliver (or cause to be executed and
delivered) to each Guarantor all such proxies and other instruments as such
Guarantor may reasonably request for the purpose of enabling such Guarantor to
exercise the voting and other rights that it is entitled to exercise pursuant to
paragraph (i) above and to receive the dividends or interest payments that it is
authorized to receive and retain pursuant to paragraph (ii) above.




(b) Upon the occurrence and during the continuance of any Event of Default:




     (i) All rights of each Guarantor (A) to exercise or refrain from exercising the
voting and other consensual rights that it would otherwise be entitled to exercise
pursuant to Section 5.07(a)(i) shall cease and (B) to receive the dividends,
interest and other distributions that it would otherwise be authorized to receive
and retain pursuant to Section 5.07(a)(ii) shall automatically cease, and all such
rights shall thereupon become vested in the Agent, which shall thereupon have the
sole right to exercise or refrain from exercising such voting and other consensual
rights and to receive and hold as Security Collateral such dividends, interest and
other distributions.




     (ii) All dividends, interest and other distributions that are received by any
Guarantor contrary to the provisions of paragraph (i) of this Section 5.07(b) shall
be received in trust for the benefit of the Agent, shall be segregated from other
funds of such Guarantor and shall be forthwith paid over to the Agent as Security
Collateral in the same form as so received (with any necessary indorsement).



          Section 5.08 Transfers and Other Liens; Additional Shares. (a) Each Guarantor agrees
that it will not (i) sell, assign or otherwise dispose of, or grant any option with respect to, any
of the Collateral, other than sales, assignments and other dispositions of Collateral, and options
relating to Collateral, permitted under the terms of the Credit Agreement, or (ii) create or suffer
to exist any Lien upon or with respect to any of the Collateral of such Guarantor except for the
pledge, assignment and security interest created under this Agreement and Permitted Collateral
Liens.






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     (b) Each Guarantor agrees that it will (i) cause each issuer of the Pledged Equity
pledged by such Guarantor not to issue any Equity Interests or other securities in addition
to or in substitution for the Pledged Equity issued by such issuer, except to such
Guarantor, and (ii) pledge hereunder, immediately upon its acquisition (directly or
indirectly) thereof, any and all additional Equity Interests or other securities.



          Section 5.09 Agent Appointed Attorney-in-Fact. Each Guarantor hereby irrevocably appoints
the Agent such Guarantor’s attorney-in-fact, with full authority in the place and stead of such
Guarantor and in the name of such Guarantor or otherwise, from time to time in the Agent’s
discretion, after the occurrence and during the continuance of an Event of Default, to take any
action and to execute any instrument that the Agent may deem necessary or advisable to accomplish
the purposes of this Agreement (such power being coupled with an interest), including, without
limitation:





     (a) to ask for, demand, collect, sue for, recover, compromise, receive and give
acquittance and receipts for moneys due and to become due under or in respect of any of the
Collateral,




     (b) to receive, indorse and collect any drafts or other instruments, documents and
chattel paper, in connection with clause (a) above, and




     (c) to file any claims or take any action (including any action necessary to consummate
the sale or transfer of title to any of the Collateral in accordance with the provisions of
the Loan Documents) or institute any proceedings that the Agent may deem reasonably
necessary for the collection of any of the Collateral or otherwise to enforce compliance
with the terms and conditions of any Loan Document or the rights of the Agent with respect
to any of the Collateral.



          Section 5.10 Agent May Perform. If any Guarantor fails to perform any agreement contained
herein, the Agent may, but without any obligation to do so and without prior notice except such
notice as is reasonable to provide under the circumstances, itself perform, or cause performance
of, such agreement; and the reasonable expenses of the Agent incurred in connection therewith shall
be payable by such Guarantor under Section 7.04(a).




          Section 5.11 The Agent’s Duties. (a) The powers conferred on the Agent hereunder
are solely to protect the Secured Parties’ interest in the Collateral and shall not impose any duty
upon it to exercise any such powers. Except for the safe custody of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the Agent shall have no
duty as to any Collateral, as to ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Collateral, whether or not any
Secured Party has or is deemed to have knowledge of such matters, or as to the taking of any
necessary steps to preserve rights against any parties or any other rights pertaining to any
Collateral. The Agent shall be deemed to have exercised reasonable care in the custody and
preservation of any Collateral in its possession if such Collateral is accorded treatment
substantially equal to that which it accords its own property.





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          (b) Anything contained herein to the contrary notwithstanding, the Agent may from time to
time, when the Agent deems it to be necessary, appoint one or more subagents (each a “Subagent”)
for the Agent hereunder with respect to all or any part of the Collateral. In the event that the
Agent so appoints any Subagent with respect to any Collateral, (i) the assignment and pledge of
such Collateral and the security interest granted in such Collateral by each Guarantor hereunder
shall be deemed for purposes of this Agreement to have been made to such Subagent, in addition to
the Agent, for the ratable benefit of the Secured Parties, as security for the Secured Obligations,
(ii) such Subagent shall automatically be vested, in addition to the Agent, with all rights,
powers, privileges, interests and remedies of the Agent hereunder with respect to such Collateral,
and (iii) the term “Agent”, when used herein in relation to any rights, powers, privileges,
interests and remedies of the Agent with respect to such Collateral, shall include such Subagent;
provided, however, that no such Subagent shall be authorized to take any action with respect to any
such Collateral unless and except to the extent expressly authorized in writing by the Agent.




          Section 5.12 Remedies. If any Event of Default shall have occurred and be continuing:




          (a) The Agent may exercise in respect of the Collateral, in addition to other rights and
remedies provided for herein or otherwise available to it, all the rights and remedies of a secured
party upon default under the UCC (whether or not the UCC applies to the affected Collateral) and
also may: (i) without notice except as specified below, sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any of the Agent’s offices or elsewhere, for
cash, on credit or for future delivery, and upon such other terms as the Agent may deem
commercially reasonable; and (ii) exercise any and all rights and remedies of any of the Guarantors
under or in connection with the Collateral, or otherwise in respect of the Collateral, including,
without limitation, (A) withdraw all funds with respect to the Account Collateral and (B) those set
forth in Section 9-607 of the UCC. Each Guarantor agrees that, to the extent notice of sale shall
be required by law, at least ten days’ notice to such Guarantor of the time and place of any public
sale or the time after which any private sale is to be made shall constitute reasonable
notification. The Agent shall not be obligated to make any sale of Collateral regardless of notice
of sale having been given. The Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned.




          (b) Any cash held by or on behalf of the Agent and all cash proceeds received by or on behalf
of the Agent in respect of any sale of, collection from, or other realization upon all or any part
of the Collateral may, in the discretion of the Agent, be held by the Agent as collateral for,
and/or then or at any time thereafter applied (after payment of any amounts payable to the Agent
pursuant to Section 14) in whole or in part by the Agent for the ratable benefit of the Secured
Parties against, all or any part of the Secured Obligations, in the following manner:





     (i) first, paid to the Agent for any amounts then owing to it pursuant
to Section 13.5 of the Credit Agreement or otherwise under the Loan Documents; and





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     (ii) second, paid to the Agent for the account of the 2012 Banks, for
any Secured Obligations then owing to them under the Loan Documents.


Any surplus of such cash or cash proceeds held by or on the behalf of the Agent and remaining after
payment in full in cash of all the Secured Obligations shall be paid over to the applicable
Guarantor or to whomsoever may be lawfully entitled to receive such surplus.




          (c) All payments received by any Guarantor in respect of the Collateral shall be received in
trust for the benefit of the Agent, shall be segregated from other funds of such Guarantor and
shall be forthwith paid over to the Agent in the same form as so received (with any necessary
indorsement).




          (d) The Agent may, without notice to any Guarantor except as required by law and at any time
or from time to time, charge, set off and otherwise apply all or any part of the Secured
Obligations against any funds held with respect to the Account Collateral or in any other deposit
account.




          (e) The Agent may send to each bank, securities intermediary or issuer party to the Holdco I
DACA, any securities account control agreement or uncertificated security control agreement a
“Notice of Exclusive Control” as defined in and under such agreement.




          Section 5.13 Continuing Security Interest. This Article V shall create a continuing
security interest in the Collateral and shall, except as provided in Section 5.14, (a) remain in
full force and effect until the termination of the Guarantee pursuant to Section 2.05(a) and the
payment in full of the Secured Obligations in cash, (b) be binding upon each Guarantor, its
successors and assigns and (c) inure, together with the rights and remedies of the Agent hereunder,
to the benefit of the Secured Parties and their respective successors, transferees and assigns.




          Section 5.14 Release; Termination. (a) Upon any sale, transfer or other
disposition of any Pledged SPE, Intermediate Lessee or Parent Holdco in accordance with the terms
of the Loan Documents, the security interest hereof and related guaranties will be deemed to be
released in respect of, and the Agent will, at such Guarantor’s expense, execute and deliver to
such Guarantor such documents as such Guarantor shall reasonably request to evidence the release of
(i) such Pledged SPE or Intermediate Lessee from the security interest granted hereby, in the case
of any sale, transfer or other disposition of any Pledged SPE or Intermediate Lessee, or (ii) such
Parent Holdco from its obligations hereunder and from the security interest granted hereby, in the
case of any sale, transfer or other disposition of any Parent Holdco, and to the extent that (A)
the Collateral Agent’s consent is required for any deregistration of the interests in such released
Collateral from any registry or (B) the Collateral Agent is required to initiate any such
deregistration, the Collateral Agent shall, at such Guarantor’s expense, take all action reasonably
requested by such Guarantor to provide such consent or to initiate such deregistration. For the
avoidance of doubt, upon or following any sale, transfer or other disposition by any Pledged SPE of
any Eligible Aircraft strictly in accordance with the terms of the Loan Documents, such Pledged SPE
and any related Intermediate Lessee may be dissolved, liquidated or wound up, provided that at the
time of such dissolution, liquidation or winding up such Pledged SPE shall not Own any Eligible
Aircraft and, in the case of any related Intermediate





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Lessee, such Intermediate Lessee shall not be leasing any Eligible Aircraft Owned by any
other Pledged SPE.




          (b) Upon payment in full in cash of the Secured Obligations and termination or expiration of
the 2012 Commitments, the pledge, assignment and security interest granted hereby shall terminate
and all rights to the Collateral shall revert to the applicable Guarantor. Upon any such
termination, the Agent will, at the applicable Guarantor’s expense, execute and deliver to such
Guarantor such documents as such Guarantor shall reasonably request to evidence such termination.




          (c) If, prior to the termination of this Agreement, the Collateral Agent ceases to be the
Collateral Agent in accordance with the definition of “Collateral Agent” hereunder, all
certificates, instruments or other documents being held by the Collateral Agent at such time shall,
as soon as reasonably practicable, be delivered to the successor Collateral Agent.




          Section 5.15 Application of Irish Law. (a) In the event that:




          (i) the laws of Ireland apply at any time to (A) the Collateral or any part thereof, or (B)
the security created by this Agreement over or with respect to the Collateral or any part thereof;
or




          (ii) the Collateral or any part thereof is at any time situated in Ireland (any Collateral
described in (i) or (ii) above being referred to as the “Irish Collateral”);




          the following provisions of this Section 5.15 shall apply.




          (b) The provisions of Chapter 2 (Powers and rights of mortgagor) and Chapter 3 (Obligations,
powers and rights of mortgagee) of Part 10 (Mortgages) of the Irish Act, subject to clauses (c),
(d), (e ), (f) and (g) below, shall apply to this Agreement notwithstanding anything to the
contrary contained in this Agreement.




          (c) The provisions of sections 96(1)(c) (Powers and rights generally), 97 (Taking possession),
99(1) (Mortgagee in possession), 101 (Applications under sections 97 and 100), 103(2) (Obligations
on selling), 106(3) (Mortgagee’s receipts), 107 (Application of proceeds of sale), 108(7)
(Appointment of receiver), 109 (Application of money received) and 110(2) (Insurance) of the Irish
Act shall not apply to this Agreement.




          (d) The restrictions and any requirements to give notice to each relevant Guarantor contained
in sections 100 (Power of sale) and 108(1) (Appointment of receiver) of the Irish Act shall not
apply to this Agreement.




          (e) Notwithstanding anything to the contrary contained in the Irish Act, the Collateral Agent
reserves the right to consolidate mortgage securities without restriction.




          (f) No Guarantor shall be entitled to take any action in respect of the Irish Collateral
pursuant to section 94 (Court order for sale) of the Irish Act.






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          (g) The Collateral Agent may, at any time and from time to time, delegate by power of attorney
or in any other manner (including, without limitation, under the hand of any officer of the
Collateral Agent) to any person or persons or company or fluctuating body of persons all or any of
the powers, authorities and discretions which are, for the time being, exercisable by the
Collateral Agent under this Agreement or under the Irish Act without the restrictions contained in
the Irish Act in relation to the Irish Collateral or any part thereof, and any such delegation may
be made upon such terms and conditions (including power to sub-delegate) and subject to such
regulations as the Collateral Agent may think fit, and the Collateral Agent shall not be in any way
liable or responsible to each relevant Guarantor for any loss or damage arising from any act,
default, omission, or misconduct on the part of any such delegate (or sub-delegate).




          (h) The restrictions on taking possession of mortgaged property contained in section 97 of the
Irish Act shall not apply to this Agreement. If an Event of Default shall have occurred and be
continuing the Collateral Agent may, without notice to each relevant Guarantor, in writing as a
deed under its Common Seal or under the hand of any officer or manager or any other nominated
person of the Collateral Agent, appoint any person to be a Receiver of all or any part of the Irish
Collateral and may, except as otherwise required by statute, remove any such Receiver and appoint
another in his place or appoint another person to act jointly with any such Receiver.




          (i) Such an appointment over part only of the Irish Collateral shall not preclude the
Collateral Agent from making any subsequent appointment of the same or another Receiver over any
part of the Irish Collateral over which an appointment has not been previously made.




          (j) Where more than one Receiver is appointed they shall have power to act severally unless
the Collateral Agent shall in the appointment specify to the contrary.




          (k) A Receiver shall be deemed at all times and for all purposes to be the agent of each
relevant Guarantor in respect of which he is appointed and each relevant Guarantor shall be solely
responsible for his acts or defaults and for the payment of his remuneration and the Receiver shall
at no time act as agent for the Collateral Agent.




          (l) Neither the Collateral Agent nor any Receiver shall be liable to account as a mortgagee in
possession in respect of all or any part of the Irish Collateral or be liable for any loss upon
realisation or for any neglect or default of any nature whatsoever in connection with all or any
part of the Irish Collateral to which a mortgagee in possession might as such be liable.




          (m) A Receiver shall have all the powers conferred from time to time on receivers by statute
and in the case of the powers and rights conferred by the Irish Act without the restrictions
contained in the Irish Act and, in addition, power on behalf and at the cost of each relevant
Guarantor (notwithstanding liquidation of each relevant Guarantor) to do or omit to do anything
which each relevant Guarantor could do or omit to do in relation to the Irish Collateral or any
part thereof and in particular (but without limitation) a Receiver shall have the power to do all
or any of the following:





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          (i) possession: to take possession of, collect and get in the property in respect of
which he is appointed or any part thereof;




          (ii) manage: to carry on or manage or develop or diversify or concur in carrying on
or managing or developing or diversifying the business of each relevant Guarantor;




          (iii) compromise: to settle, adjust, submit to arbitration, compromise and arrange
any claims, accounts, disputes, questions, demands, with or by any person who is or claims to be a
creditor of each relevant Guarantor relating in any way to the Irish Collateral which he or the
Collateral Agent may reasonably think expedient;




          (iv) employees, etc: to appoint, hire and employ officers, employees, contractors,
agents and advisors of all kinds and to discharge any such persons and any such persons appointed,
hired or employed by each relevant Guarantor;




          (v) redemption of Security Interests: to redeem any Security Interest (whether or not
having priority to the security hereby created) over the Irish Collateral and to settle the
accounts of encumbrances;




          (vi) take an indemnity: to take any indemnity from each relevant Guarantor from and
against all actions, claims, expenses, demands and liabilities whether arising out of contract or
out of tort or in any other way incurred by him or by any manger, agent, officer, servant or
workman for whose debt, default or miscarriage he may be answerable for anything done or omitted to
be done in the exercise or purported exercise of his powers under this Agreement or under any
appointment duly made under the provisions of this paragraph and if he thinks fit but without
prejudice to the foregoing to effect with any insurance company or office or underwriters any
policy or policies of insurance either in lieu or satisfaction of or in addition to such indemnity
from each relevant Guarantor;




          (vii) sell: to sell, exchange, convert into money and realise all or any part of the
Irish Collateral by public auction or private contract and generally in such manner and on such
terms and conditions as he shall think proper. (The consideration for any such transaction may
consist of cash, debenture or other obligations, shares, stock or valuable consideration and any
such consideration may be payable in a lump sum or by instalments spread over such period as he
thinks fit);




          (viii) borrow money: to raise and borrow money either unsecured or on the security of
any Irish Collateral either in priority to the security constituted by this Agreement or otherwise
and generally on any terms and for whatever purpose which he thinks fit. (No person lending that
money is concerned to enquire as to the propriety or purpose of the exercise of that power or to
check the application of any money so raised or borrowed).




          (ix) legal actions: to bring, prosecute, enforce, defend, and abandon all actions,
suits and proceedings in relation to any Irish Collateral which may seem to him to be expedient;




          (x) receipts: to give valid receipts for all monies and execute all assurances and
things which may be proper or desirable for realising the Irish Collateral;





ILFC — Security and Guarantee Agreement







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          (xi) use the name of each relevant Guarantor: to use the name of each relevant
Guarantor for all or any of the purposes aforesaid and in any legal proceedings with full power to
convey any property sold in the name of each relevant Guarantor for all of which purposes each
relevant Guarantor hereby irrevocably and by way of security appoints every such Receiver to be its
attorney; and




          (xii) other powers: to do all such other acts or things as he may consider to be
incidental or conducive to any of the matters or powers aforesaid and to exercise in relation to
the Irish Collateral or any of them all such powers, authorities and things as he would be capable
of exercising if he were the absolute beneficial owner of the same.




          (n) Section 108(7) of the Irish Act shall not apply to the commission and/or remuneration of a
Receiver appointed pursuant to this Agreement. A Receiver shall be entitled to remuneration at a
rate to be fixed by agreement between him and the Collateral Agent (or, failing such agreement, to
be fixed by the Collateral Agent).




ARTICLE VI

MISCELLANEOUS




          Section 6.01 Amendments, Waivers, Supplements, Etc.




          (a) Unless otherwise specifically provided for herein, no amendment, supplement, modification
or waiver of any provision of this Agreement, and no consent to any departure by any Guarantor
therefrom, shall in any event be effective unless the same shall be in writing and signed by each
Guarantor, the Agent and the Required Secured Parties, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which it is given;
provided that, in addition to the consent of each Guarantor, and the appropriate Secured Parties,
the Agent’s prior written consent shall be required in connection with any amendment, supplement,
modification, waiver or consent subjecting the Agent to any increased or additional duties or
obligations hereunder or in connection therewith; and provided further that no amendment,
supplement, modification, waiver or consent shall do any of the following without the consent of
all the Secured Parties: (i) except as expressly permitted under the Loan Documents, including
Section 5.14 hereof, reduce or limit the obligations of any Guarantor hereunder, release any
Guarantor hereunder or otherwise limit any Guarantor’s liability with respect to the Obligations
owing to the Secured Parties under or in respect of the Loan Documents, (ii) except as expressly
permitted under the Loan Documents, release all or substantially all of the Collateral, (iii)
change the percentage of (A) the 2012 Commitments or (B) the aggregate unpaid principal amount of
the 2012 Committed Loans that, in each case shall be required for the Secured Parties or any of
them to take any action hereunder, (iv) amend in any manner any provision of this Agreement which,
by its terms, expressly requires the approval or concurrence of all Secured Parties, or (v) amend
this Section 6.01(a).




          (b) This Agreement, together with the other Loan Documents, contains a final and complete
integration of all prior expressions by the parties hereto with respect to the subject matter
hereof and shall constitute the entire agreement among the parties hereto with respect to the
subject matter hereof, superseding all prior oral or written understandings.





ILFC — Security and Guarantee Agreement







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          (c) Anything herein to the contrary notwithstanding, the Guarantors and the Agent may, without
the consent of any of the 2012 Banks, amend this Agreement or any instrument or document delivered
pursuant hereto to cure any ambiguity, defect or inconsistency therein or otherwise to implement
technical, ministerial or administrative changes.




          (d) Upon the execution and delivery by any Person of a guarantee supplement in substantially
the form of Exhibit A hereto (each, a “Guarantee Supplement”), (i) such Parent Holdco shall be
referred to as an “Additional Guarantor” and shall become and be a Guarantor hereunder, and each
reference in this Agreement or in any other Loan Document to a “Guarantor” shall also mean and be a
reference to such Additional Guarantor, and (ii) each reference herein to “this Agreement”,
“hereunder”, “hereof” or words of like import referring to this Agreement, and each reference in
any other Loan Document to the “Security and Guarantee Agreement”, “thereunder”, “thereof” or words
of like import referring to this Agreement, shall mean and be a reference to this Agreement as
supplemented by such Guarantee Supplement.




          (e) (i) Upon any sale, transfer or other disposition of any Parent Holdco, Intermediate Lessee
or Pledged SPE in accordance with the terms of the Loan Documents, or the formation or acquisition
of any Parent Holdco, Pledged SPE or Intermediate Lessee, Schedule II hereof shall be deemed
amended to reflect the removal or addition, as the case may be, the Equity Interests of such Parent
Holdco, Pledged SPE or Intermediate Lessee, and the Guarantor that owned or now owns such Equity
Interests shall, promptly following such sale, transfer or other disposition or such formation or
acquisition, deliver to the Collateral Agent a Collateral Supplement reflecting such removal or
addition.





          (ii) Upon any formation or acquisition of any Parent Holdco, Pledged SPE or
Intermediate Lessee organized under the laws of Ireland, Holdco I or the Parent Holdco
holding the Equity Interests in such Pledged SPE or Intermediate Lessee, as the case may be,
shall promptly, in addition to delivering to the Collateral Agent the revised Schedule II in
accordance with clause (i) above, promptly enter into an Irish law Share Charge, in form and
substance reasonably satisfactory to the Collateral Agent, in respect of such Equity
Interests and promptly cause such Share Charge to be filed with the Irish Companies
Registration Office and the Irish Revenue Commissioners and in each case shall provide
evidence of such filings reasonably satisfactory to the Collateral Agent.



          Section 6.02 Notices, Etc.




          (a) All notices and other communications provided for hereunder shall, unless otherwise stated
herein, be either in writing (including by facsimile) and delivered by nationally recognized
courier service, telefax or otherwise, or sent by electronic mail, confirmed immediately in writing
(including by facsimile), (i) if to any Guarantor, addressed to it in care of the Company at the
Company’s address specified on Schedule III to the Credit Agreement, (ii) if to the Agent, at its
address specified on Schedule III to the Credit Agreement, or (iii) as to any party, at such other
address as shall be designated by such party in a written notice to each other party.




          (b) All such notices and communications shall, when faxed, sent by electronic mail or
otherwise delivered, be effective when faxed (as confirmed by generation of a




ILFC — Security and Guarantee Agreement







32









 







confirmation report), when sent by electronic mail and confirmed in writing (including by
facsimile), or when otherwise delivered (as confirmed by a signed receipt), respectively, or, if
faxed, sent by electronic mail or otherwise delivered on any day other than a Business Day, on the
next succeeding Business Day.




          Section 6.03 No Waiver; Remedies Cumulative.




          (a) No failure on the part of the Agent or any Secured Party to exercise, and no delay in
exercising, any right hereunder or under any Loan Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right.




          (b) No right or remedy herein or in any other Loan Document conferred upon or reserved to the
Agent or any other Secured Party is intended to be exclusive of any other right or remedy, and
every such right or remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder, under any Loan Document or now or hereafter existing
at law, in equity or otherwise, and each and every right, power and remedy, whether specifically
herein given or otherwise existing, may be exercised from time to time and as often and in such
order as may be deemed expedient by the party exercising such right, power or remedy, and the
exercise or the beginning of the exercise of any right or power or remedy shall not be construed to
be a waiver of the right to exercise at the same time or thereafter any other right, power or
remedy.




          Section 6.04 Indemnification.




          (a) Without limitation on any other Obligations of any Guarantor or remedies of the Secured
Parties under this Agreement, each Guarantor shall, to the fullest extent permitted by law,
indemnify, defend and save and hold harmless each Secured Party and each of their Affiliates and
their respective officers, directors, employees, agents and advisors (each, an “Indemnified Party”)
from and against, and shall pay on demand, any and all claims, damages, losses, liabilities
(including any brokers’, finders’, intermediaries’ or similar fees or commissions) and expenses
(including fees and expenses of counsel) of any kind or nature whatsoever, imposed on, incurred by,
or asserted or awarded against any Indemnified Party, in each case in any manner relating to,
arising out of or in connection with or by reason of (including in connection with any
investigation, litigation or proceeding or the preparation of a defense in connection therewith),
(i) this Agreement or any of the transactions contemplated hereby (including, without limitation,
enforcement of this Agreement), or (ii) any failure of any Guaranteed Obligations to be the legal,
valid an binding obligations of any Guarantor enforceable against such Guarantor in accordance with
their terms, except in the case of clause (i) to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party’s gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity in this Section 6.04(a)
applies (or the preparation of a defense in connection therewith), such indemnity shall be
effective whether or not such investigation, litigation or proceeding is brought by any Guarantor,
its directors, shareholders or creditors, any Indemnified Party or any other Person, and whether or
not any Indemnified Party is otherwise a party thereto. Each Guarantor also agrees not to assert
any claim against any Indemnified Party,





ILFC — Security and Guarantee Agreement






33









 







on any theory of liability, for special, indirect, consequential or punitive damages arising
out of or otherwise relating to the Loan Documents or any of the transactions contemplated thereby.




          (b) Each Guarantor shall defend the Collateral of such Guarantor against all claims and
demands of all Persons (other than Permitted Collateral Liens) at any time claiming any interest
therein that is, or in a manner which is, adverse to any Secured Party.




          (c) Without prejudice to the survival of any other agreement of any Guarantor hereunder or
under any other Loan Document, the agreements and obligations of the parties contained in Sections
2.01(a) (with respect to enforcement expenses), 2.02, 2.06, this Section 6.04 and Section 6.12
shall survive the payment in full of the Guaranteed Obligations and all other amounts payable under
this Agreement, or any termination of this Agreement.




          Section 6.05 Collateral Agent. Each 2012 Bank hereby authorizes the Agent to act on its
behalf upon and subject to the terms set forth in Section 12 of the Credit Agreement which Section
12 is hereby incorporated herein in its entirety mutatis mutandis.




          Section 6.06 Assignments; Binding Effect. Any Secured Party may assign or otherwise
transfer all or any portion of its rights and obligations under the Credit Agreement (including,
without limitation, all or any portion of its 2012 Commitment, the 2012 Committed Loans owing to it
and any 2012 Committed Note held by it) to any other Person in accordance with the Credit
Agreement, and such other Person shall thereupon become vested with all the benefits in respect
thereof granted to such Secured Party herein or otherwise, in each case as and to the extent
provided in Section 13.4 of the Credit Agreement. No Guarantor shall have the right to assign any
of its rights or obligations hereunder or any interest herein without the prior written consent of
the Secured Parties, and any assignment or purported assignment by any Guarantor in violation of
this Section 6.06 shall be void ab initio. This Agreement shall become effective when it shall
have been executed by the Guarantors and thereafter be binding upon and inure to the benefit of
each of the parties hereto, and their respective successors and permitted assigns.




          Section 6.07 Execution in Counterparts; Severability. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier or by email transmission of a scanned “.pdf” document shall be effective as
delivery of a manually executed counterpart of this Agreement. If any provision set forth in this
Agreement shall be deemed invalid, illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or impaired
thereby.




          Section 6.08 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the law of the State of New York.




          Section 6.09 Jurisdiction; Etc.




          (a) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and
its property, to the non-exclusive jurisdiction of any New York State or federal





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court of the United States of America sitting in New York County, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this Agreement or the other
Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent permitted by law,
in such Federal court. Each of the parties hereto agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.




          (b) Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or
the other Loan Documents in any New York State or Federal court of the United States of America
sitting in New York County. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.




          (c) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 6.02. Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.




          Section 6.10 Table of Contents, Headings, Etc.. The Table of Contents and headings of the
Articles and Sections of this Agreement have been inserted for convenience of reference only, are
not to be considered a part hereof and shall in no way modify or restrict any of the terms and
provisions hereof.




          Section 6.11 Non-Invasive Provisions. (a) Notwithstanding any other provision of the
Loan Documents, the Collateral Agent agrees that, so long as no Event of Default shall have
occurred and be continuing, not to take any action or cause to be taken any action, or permit any
person claiming by, through or on behalf of it to take any action or cause any action, that would
interfere with the possession, use, operation and quiet enjoyment of and other rights with respect
to any Aircraft or other property relating thereto and all rents, revenues, profits and income
therefrom, including, the right to enforce manufacturers’ warranties, the right to apply or obtain
insurance proceeds for damage to the Aircraft to the repair of the Aircraft and the right to engage
in pooling, leasing and similar actions, in each case in accordance with the terms of this
Agreement.




          (b) Notwithstanding any other provision of the Loan Documents, the Collateral Agent agrees
that, so long as no “Event of Default” (or similar term) under a Lease (as defined in such Lease)
shall have occurred and be continuing, not to take any action or cause to be taken any action, or
permit any person claiming by, through or on behalf of it to take any action or cause any action,
that would interfere with the possession, use, operation and quiet enjoyment of and other rights of
the Lessee with respect to any Aircraft or other property relating thereto and all rents, revenues,
profits and income therefrom, including, the right to enforce manufacturers’ warranties, the right
to apply or obtain insurance proceeds for damage to the Aircraft to the repair of the Aircraft and
the right to engage in pooling, leasing and similar actions, in each case in accordance with the
terms of such Lease.






ILFC — Security and Guarantee Agreement






35









 








          Section 6.12 Limited Liability. (a) In the event that the direct or indirect assets of a
Guarantor are insufficient, after payment of all other claims, if any, ranking in priority to the
claims of the Collateral Agent or any Secured Party hereunder, to pay in full such claims of the
Collateral Agent or such Secured Party (as the case may be), then the Collateral Agent or the
Secured Party shall have no further claim against such Guarantor in respect of any such unpaid
amounts; provided that the foregoing limitation on recourse shall in no way limit the right of any
Secured Party to enforce the obligations of Company.




          (b) No recourse under any Loan Document shall be had against, and no personal liability shall
attach to, any officer, employee, director, Affiliate or shareholder (other than any Affiliate or
shareholder that is a Loan Party) of the Agent or any Secured Party or Holdco I or any Parent
Holdco or any Pledged SPE or any Intermediate Lessee, as such, by the enforcement of any assessment
or by any legal or equitable proceeding, by virtue of any statute or otherwise in respect of any of
the Loan Documents, it being expressly agreed and understood that each Loan Document is solely a
corporate obligation of the Agent and the Secured Parties, Holdco I, the Parent Holdcos, the
Pledged SPEs, the Intermediate Lessees and that any and all personal liability, either at common
law or in equity, or by statute or constitution, of every such officer, employee, director,
Affiliate or shareholder (other than any Affiliate or shareholder that is a Loan Party) for
breaches by any such party of any obligations under any Loan Document is hereby expressly waived.




          (c) The guarantees, obligations, liabilities and undertakings granted by any Guarantor,
Pledged SPE or Intermediate Lessee organized under the laws of France under this Agreement and the
other Loan Documents shall, for each relevant financial year, be, in any and all cases, strictly
limited to 90% of the annual net margin generated by such Guarantor, Pledged SPE or Intermediate
Lessee in connection with back-to-back leasing activities between it and any other Guarantor,
Pledged SPE or Intermediate Lessee with respect to the lease of Eligible Aircraft.




          Section 6.13 USA Patriot Act. Each Secured Party hereby notifies each Guarantor that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that
identifies such Guarantor, which information includes the name and address of such Guarantor and
other information that will allow such Secured Party to identify such Guarantor in accordance with
the Act.




          Section 6.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS,
THE LOANS OR THE ACTIONS OF ANY PERSON IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT THEREOF.




[SIGNATURE PAGES FOLLOW]




ILFC — Security and Guarantee Agreement










36









 








          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective Authorized Officers as of the date first above written.




	 	 	 	 	 
	 	FLYING FORTRESS INC.,

as a Guarantor

 	 
	 	By:  	            /s/ Pamela S. Hendry
 	 
	 	 	Name:  	Pamela S. Hendry 	 
	 	 	Title:  	Director 	 
	 



	 	 	 	 	 

	 

	 	[Signature Page]
	 	ILFC — Security and Guarantee Agreement






 









 






	 	 	 	 	 
	 	FLYING FORTRESS US LEASING INC.,

as a Guarantor

 	 
	 	By:  	/s/ Pamela S. Hendry
 	 
	 	 	Name:  	Pamela S. Hendry 	 
	 	 	Title:  	Director 	 
	 



	 	 	 	 	 

	 

	 	[Signature Page]
	 	ILFC — Security and Guarantee Agreement






 









 






	 	 	 	 	 
	 	SIGNED AND DELIVERED AS A DEED for and on behalf of:



FLYING FORTRESS IRELAND LEASING LIMITED

as a Guarantor



By its lawfully appointed attorney:

 	 
	 	/s/ Niall C. Sommerville
 	 
	 	Name:  	Niall C. Sommerville 	 
	 	Title:  	Director 	 
	 



	 	 	 	 	 
	 	In the presence of:

 	 
	 	Maeveo Reilly
 	 
	 	30 North War Quay 	 
	 	Dublin 1 	 
	 



	 	 	 	 	 

	 

	 	[Signature Page]
	 	ILFC — Security and Guarantee Agreement






 









 






	 	 	 	 	 
	 	CITICORP USA, INC.,

as Collateral Agent

 	 
	 	By:  	/s/ Maureen P. Maroney
 	 
	 	 	Name:  	Maureen P. Maroney 	 
	 	 	Title:  	Authorized Signatory 	 
	 



	 	 	 	 	 

	 

	 	[Signature Page]
	 	ILFC — Security and Guarantee Agreement







 











 





Schedule I

to the

Security and Guarantee Agreement




LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION,

JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Jurisdiction of	 	Organizational I.D.
	Grantor	 	Location	 	Chief Executive Office	 	Type of Organization	 	Organization	 	No.
	 
	Flying Fortress Inc.

	 	California
	 	10250 Constellation
Blvd., Suite 3400,
Los Angeles,
California 90067
U.S.A.
	 	Corporation
	 	California
	 	 C 3285904 

	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Flying Fortress US
Leasing Inc.

	 	California
	 	10250 Constellation
Blvd., Suite 3400,
Los Angeles,
California 90067
U.S.A.
	 	Corporation
	 	California
	 	 C 3285903 

	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Flying Fortress 

Ireland Leasing 

Limited

	 	Ireland
	 	30 North Wall Quay,

Dublin 1

Ireland
	 	Private Limited

Liability

Corporation
	 	Ireland
	 	 	483084	 






 









 






Schedule II

to the

Security and Guarantee Agreement




PLEDGED EQUITY




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Percentage
	 	 	 	 	 	 	 	 	 	 	 	 	Number or	 	of
	 	 	 	 	Type or Class of	 	 	 	Certificate	 	Percentage of	 	Outstanding
	Grantor	 	Issuer	 	Equity Interest	 	Par Value	 	No(s)	 	Equity Interests	 	Equity Interests
	Flying Fortress Inc.

	 	Flying Fortress US
Leasing Inc.
	 	Common Stock
	 	US $1
	 	 	1	 	 	 	100	 	 	 	100	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Flying Fortress Inc.

	 	Flying Fortress

Ireland Leasing

Limited
	 	Ordinary Shares
	 	US $1
	 	 	1	 	 	 	2	 	 	 	100	%






 









 






Schedule III

to the

Security and Guarantee Agreement




CHANGES IN NAME, LOCATION, ETC.





	1.	 	Changes in the Grantor’s Name (including new Grantor with a new name and names associated
with all predecessors in interest of the Grantor):





	 	 	 
	Grantor	 	Changes
	N/A
	 	 







	2.	 	Changes in the Grantor’s Location:





	 	 	 
	Grantor	 	Changes
	N/A
	 	 







	3.	 	Changes in the Grantor’s Chief Executive Office:





	 	 	 
	Grantor	 	Changes
	N/A
	 	 







	4.	 	Changes in the Type of Organization:





	 	 	 
	Grantor	 	Changes
	N/A
	 	 







	5.	 	Changes in the Jurisdiction of Organization:





	 	 	 
	Grantor	 	Changes
	N/A
	 	 







	6.	 	Changes in the Organizational Identification Number:





	 	 	 
	Grantor	 	Changes
	N/A
	 	 






 









 






Schedule 3.02(g)

to the

Security and Guarantee Agreement




AUTHORIZATIONS AND APPROVALS





	1.	 	Waiver and Consent Letter dated on or about April 13, 2010, among the Required Persons,
ILFC, Top Aircraft, Inc., Shrewsbury Aircraft Leasing Limited and States Aircraft, Inc.
under that certain (i) Credit Agreement, dated as of October 13, 2009, among ILFC (the
“Parent Borrower”), States Aircraft, Inc. (the “U.S. Subsidiary Borrower”),
Shrewsbury Aircraft Leasing Limited (the “Irish Subsidiary Borrower” and together
with the Parent Borrower and the U.S. Subsidiary Borrower, the “Borrowers”), Top
Aircraft, Inc. (“Holdings”), ILFC Ireland Limited (“ILFC Ireland”), ILFC
France S.a.r.l. (“ILFC France”), ILFC Labuan Ltd. (“ILFC Labuan” and
together with ILFC Ireland and ILFC France, the “Initial Intermediate Lessees”),
ILFC Aruba A.V.V. (“ILFC Aruba”), ILFC (Bermuda) III, Ltd. (“ILFC
Bermuda”), ILFC Cayman Limited (“ILFC Cayman” and together with ILFC Aruba and
ILFC Bermuda, the “New Intermediate Lessees”), AIG Funding, Inc. (the
“Lender”), and Wells Fargo Bank Northwest, National Association (“Wells
Fargo”), as Security Trustee, and (ii) Amended and Restated Credit Agreement, dated as
of October 13, 2009 (as may be amended, restated, supplemented or otherwise modified from
time to time) among the Borrowers, Holdings, the Initial Intermediate Lessees, the New
Intermediate Lessees, the Lender, and Wells Fargo, as Security Trustee.






	2.	 	Waiver and Consent Letter dated on or about April 13, 2010, to that certain Credit
Agreement, dated as of September 22, 2008 (as may be amended, restated, supplemented or
otherwise modified from time to time) between American International Group, Inc., as
Borrower, and the Federal Reserve Bank of New York, as Lender.





					
	 
	 	4.01(f)-1
	 	ILFC — Security and Guarantee Agreement






 









 






Schedule 4.01(f)

to the

Security and Guarantee Agreement




INSURANCE





	1.	 	Obligation to Insure
	 
	 	 	So long as this Agreement shall remain in effect, the Guarantors will ensure that there is
effected and maintained appropriate insurances in respect of each Eligible Aircraft and the
Collateral Agent, the Administrative Agent, the Lenders and its operation including insurance
for:






	 	(a)	 	loss or damage to each Eligible 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
Eligible Aircraft and of any other part thereof not belonging to the Guarantors but from
time to time installed on the airframe.






	2.	 	Specific Insurances
	 
	 	 	The Guarantors will maintain or will cause to be maintained the following specific insurances
with respect to each Eligible Aircraft (subject to paragraph 3):






	 	(a)	 	All Risks Hull Insurance — All risks hull insurance policy on the Eligible
Aircraft in an amount at least equal to 110% of the outstanding principal of the Loans
allocable to such Eligible 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 Guarantor 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
Eligible Aircraft where the custom in the industry is to carry war risk for aircraft
operating on routes or kept in locations similar to the Eligible Aircraft in an amount
not less than the Required Insured Value on an agreed value basis and naming the





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	 	 	 	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 Guarantors 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. 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 Guarantors 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 Requirements
	 
	 	 	In certain circumstances, it is customary that not all of the insurances described in
paragraph 2 be carried for the Eligible Aircraft. For example, when a Eligible 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 Eligible Aircraft are
applicable. Similarly, indemnities may be provided by a Governmental Authority in lieu of
particular insurances; provided, however, that the Guarantors 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
Guarantor will determine the necessary coverage for the Eligible Aircraft in such situations
consistent with Leasing Company Practice with respect to similar aircraft.






	4.	 	Hull Insurances in Excess of Required Insurance Value
	 
	 	 	For the avoidance of doubt, any Guarantor and/or any lessee may carry hull risks and hull war
and allied perils insurance on the Eligible Aircraft in excess of the Required Insured Value
which (subject, in the case of the Guarantors, 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 Guarantors, to the relevant Guarantor, 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.






	5.	 	Currency





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	 	 	 	All insurance and reinsurances effected pursuant to this Schedule 4.01(f) 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 Eligible
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 Insurances






	 	 	Insurance 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 Guarantors agrees that, so long as this Agreement shall remain in effect, the Eligible
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 Eligible
Aircraft utilised by operators in the same country and whose operational network for such
Eligible 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
Guarantor will set the standards, review and manage the insurances on the Eligible Aircraft
consistent with Leasing Company Practice with respect to similar aircraft.






	7.	 	Insurance Brokers and Insurers






	 	 	In 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 Eligible
Aircraft, the relevant Guarantor 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 Eligible Aircraft is not
subject to a lease, the relevant Guarantor will cause its insurance brokers to provide the
Collateral Agent with evidence that the insurances described in this Schedule 4.01(f) are in
full force and effect.






	8.	 	Deductible Amounts, Self-Insurance and Reinsurance






	 	 	With 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 Guarantor 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.




9. Renewals




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	 	 	 	The Guarantors will monitor the insurances on the Eligible Aircraft and their expiration
dates. The relevant Guarantor 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 Guarantor 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 Guarantor will provide
to the Collateral Agent evidence of renewal of the insurances and reinsurance (if any).






	10.	 	Information






	 	 	Subject to applicable confidentiality restrictions, each of the Guarantors 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 Eligible Aircraft or, if reasonably available to the Guarantors, in connection
with any claim being made or proposed to be made thereunder.





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Exhibit A

to the

Security and Guarantee Agreement




FORM OF GUARANTEE SUPPLEMENT




                                   ,               



Citicorp USA, Inc., as Collateral Agent

[Address of Collateral Agent]



Attention:                     




     Credit Agreement dated as of October 13, 2006 (as amended as of April 16, 2010, and as further amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among International Lease Finance Corporation, a California corporation, the Banks party thereto, and Citicorp USA, Inc., as administrative agent for the Banks



Ladies and Gentlemen:




          Reference is made to the above-captioned Credit Agreement and to the Security and Guarantee
Agreement referred to therein (such Security and Guarantee Agreement, as in effect on the date
hereof and as it may hereafter be amended, supplemented or otherwise modified from time to time,
together with this Guarantee Supplement, being the “Security and Guarantee Agreement”).
The capitalized terms defined in the Security and Guarantee Agreement or in the Credit Agreement
and not otherwise defined herein are used herein as therein defined.




          Section 1. Guarantee; Limitation of Liability. (a) The undersigned hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled
maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all
Obligations of each other Loan Party to any Secured Party now or hereafter existing under or in
respect of the Loan Documents (including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing Obligations), whether direct
or indirect, absolute or contingent, and whether for principal, interest, premium, fees,
indemnities, contract causes of action, costs, expenses or otherwise (such Obligations being the
“Guaranteed Obligations”), and agrees to pay any and all reasonable out-of-pocket expenses
(including, without limitation, reasonable fees and expenses of counsel) incurred by the Agent or
any other Secured Party in enforcing any rights under this Guarantee Supplement, the Security and
Guarantee Agreement or any other Loan Document. Without limiting the generality of the foregoing,
the undersigned’s liability shall extend to all amounts that constitute part of the Guaranteed
Obligations and would be owed by any other Loan Party to any Secured Party under or in respect of
the Loan Documents but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving such other Loan
Party.




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          (b) The undersigned, and by its acceptance of this Guarantee Supplement, the Agent and each
other Secured Party, hereby confirms that it is the intention of all such Persons that this
Guarantee Supplement, the Security and Guarantee Agreement and the Obligations of the undersigned
hereunder and thereunder not constitute a fraudulent transfer or conveyance for purposes of
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar foreign, federal or state law to the extent applicable to this Guarantee Supplement, the
Security and Guarantee Agreement and the Obligations of the undersigned hereunder and thereunder.
To effectuate the foregoing intention, the Agent, the other Secured Parties and the undersigned
hereby irrevocably agree that the Obligations of the undersigned under this Guarantee Supplement
and the Security and Guarantee Agreement at any time shall be limited to the maximum amount as will
result in the Obligations of the undersigned under this Guarantee Supplement and the Security and
Guarantee Agreement not constituting a fraudulent transfer or conveyance.




          (c) The undersigned hereby unconditionally and irrevocably agrees that in the event any
payment shall be required to be made to any Secured Party under this Guarantee Supplement, the
Security and Guarantee Agreement or any other guarantee, the undersigned will contribute, to the
maximum extent permitted by applicable law, such amounts to each other Guarantor and each other
guarantor so as to maximize the aggregate amount paid to the Secured Parties under or in respect of
the Loan Documents.




          Section 2. Obligations Under the Guarantee. The undersigned hereby agrees, as of the
date first above written, to be bound as a Guarantor by all of the terms and conditions of the
Security and Guarantee Agreement to the same extent as each of the other Guarantors thereunder.
The undersigned further agrees, as of the date first above written, that each reference in the
Security and Guarantee Agreement to an “Additional Guarantor” or a “Guarantor” shall also mean and
be a reference to the undersigned, and each reference in any other Loan Document to a “Guarantor”
or a “Loan Party” shall also mean and be a reference to the undersigned.




          Section 3. Representations and Warranties. The undersigned hereby makes each
representation and warranty set forth in Section 3.01 and 3.02 of the Security and Guarantee
Agreement (as supplemented by the attached supplemental schedules) to the same extent as each other
Guarantor.




          Section 4. Grant of Security. The undersigned hereby grants to the Collateral Agent, for
the ratable benefit of the Secured Parties, a security interest in, all of its right, title and
interest in and to all of the Collateral of the undersigned, whether now owned or hereafter
acquired by the undersigned, wherever located and whether now or hereafter existing or arising,
including, without limitation, the property and assets of the undersigned set forth on the attached
supplemental schedules to the Schedules to the Security and Guarantee Agreement.




          Section 5. Security for Obligations. The grant of a security interest in the Collateral
by the undersigned under this Guarantor Supplement and the Security and Guarantee Agreement secures
the payment in full in cash when due of all Obligations of the undersigned and each other Loan
Party to any Secured Party, now or hereafter existing under or in respect of the Security and
Guarantee Agreement and the other Loan Documents, whether direct or indirect, absolute or
contingent, and whether for principal, reimbursement obligations, interest




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(including interest on such obligations accruing after, and fees and expenses
arising after, the commencement of any proceeding under Title 11 of the United States Code or any
similar proceeding under state or federal law for the dissolution, restructuring, reorganization,
liquidation or the winding up of the undersigned or such Loan Party, regardless of whether such
interest, fees, or expenses are allowed as a claim against the undersigned or such Loan Party in
any such proceeding), fees, premiums, penalties, indemnifications, contract causes of action,
costs, expenses in accordance with Section 6.04(a) of the Security and Guarantee Agreement or
otherwise. Without limiting the generality of the foregoing, this Guarantor Supplement and the
Security and Guarantee Agreement secures the payment of all amounts that constitute part of the
Secured Obligations and that would be owed by the undersigned to any Secured Party under the Loan
Documents but for the fact that such Secured Obligations are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving a Loan Party.




          Section 6. Supplements to Pledge Agreement Schedules. The undersigned has attached
hereto supplemental Schedules I through III to Schedules I through III, respectively, to the
Security and Guarantee Agreement, and the undersigned hereby certifies, as of the date first above
written, that such supplemental schedules have been prepared by the undersigned in substantially
the form of the equivalent Schedules to the Security and Guarantee Agreement and are complete and
correct.




          Section 7. Delivery by Telecopier. Delivery of an executed counterpart of a signature
page to this Guarantee Supplement by telecopier or by email transmission of a scanned “.pdf”
document shall be effective as delivery of an original executed counterpart of this Guarantee
Supplement.




          Section 8. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This Guarantee
Supplement shall be governed by, and construed in accordance with, the laws of the State of New
York.




          (b) The undersigned hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or any federal court of the
United States of America sitting in New York City, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to this Guarantee Supplement, the Security and
Guarantee Agreement or any of the other Loan Documents to which it is or is to be a party, or for
recognition or enforcement of any judgment, and the undersigned hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the extent permitted by law, in such federal
court. The undersigned agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Guarantee Supplement or the Security and Guarantee
Agreement or any other Loan Document shall affect any right that any party may otherwise have to
bring any action or proceeding relating to this Guarantee Supplement, the Security and Guarantee
Agreement or any of the other Loan Documents to which it is or is to be a party in the courts of
any other jurisdiction.




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          (c) The undersigned irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection that it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Guarantee Supplement,
the Security and Guarantee Agreement or any of the other Loan Documents to which it is or is to be
a party in any New York State or federal court. The undersigned hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such
suit, action or proceeding in any such court.




          (d) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE 2012 COMMITTED LOANS OR THE ACTIONS OF ANY SECURED PARTY
IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.




	 	 	 	 	 
	 	Very truly yours,



[NAME OF ADDITIONAL GUARANTOR]1

 	 
	 	By  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 





 




			
	1	 	Conform signature block as appropriate for
Irish or other non-U.S. entities.





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Schedule I

to the

Guarantor Supplement




LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION,

JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Chief Executive	 	Type of	 	Jurisdiction of	 	Organizational/
	 	 	 	 	 	 	 	 	Office/Registered	 	Organization/	 	Organization/	 	Incorporation
	Guarantor	 	Location	 	Office	 	Incorporation	 	Incorporation	 	I.D. No.





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Schedule II

to the

Guarantor Supplement




PLEDGED EQUITY




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Percentage
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	of
	 	 	 	 	 	 	 	 	Class of Equity	 	 	 	 	 	Certificate	 	Number	 	Outstanding
	Guarantor	 	Issuer	 	Interest	 	Par Value	 	No(s)	 	of Equity Interests	 	Equity Interests





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Schedule III

to the

Guarantor Supplement




CHANGES IN NAME, LOCATION, ETC.





	7.	 	Changes in the Guarantor’s Name (including new Guarantor with a new name and names associated
with all predecessors in interest of the Guarantor):





	 	 	 	 	 

	 

	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






	8.	 	Changes in the Guarantor’s Location:





	 	 	 	 	 

	 

	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






	9.	 	Changes in the Guarantor’s Chief Executive Office or Registered Office:





	 	 	 	 	 

	 	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






	10.	 	Changes in the Type of Organization or Incorporation:





	 	 	 	 	 

	 

	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






	11.	 	Changes in the Jurisdiction of Organization or Incorporation:





	 	 	 	 	 

	 

	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






	12.	 	Changes in the Organizational or Incorporation Identification Number:





	 	 	 	 	 

	 

	 	Guarantor
	 	Changes
	 

	 	 
	 	 
	 
	 	 	 	 






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Exhibit B

to the

Security and Guarantee Agreement




FORM OF COLLATERAL SUPPLEMENT




_________ __, ____




Citicorp USA, Inc., as Collateral Agent

[Address of Collateral Agent]




Attention: _________




Ladies and Gentlemen:




          Reference is made to the Security and Guarantee Agreement, dated as of April 16, 2010 (as
amended, supplemented or otherwise modified from time to time, the “Security and Guarantee
Agreement”), among Flying Fortress Inc., a California corporation, Flying Fortress US Leasing
Inc., a California corporation, Flying Fortress Ireland Leasing Ireland Limited, a private limited
liability company incorporated under the laws of Ireland, the Additional Guarantors referred to
therein, and Citicorp USA, Inc., as collateral agent. This Collateral Supplement is being
delivered pursuant to Section 6.01(e)(i) of the Security and Guarantee Agreement. The capitalized
terms defined in the Security and Guarantee Agreement and not otherwise defined herein are used
herein as therein defined.



          The undersigned has attached hereto a supplemental Schedule II to Schedule II to the Security
and Guarantee Agreement, and the undersigned hereby certifies, as of the date first above written,
that (a) such supplemental Schedule II has been prepared by the undersigned in substantially the
form of Schedule II to the Security and Guarantee Agreement and is complete and correct, and (b) in
accordance with the terms of the Loan Documents, it has [sold, transferred or otherwise disposed
of] / [formed or acquired] the Equity Interests in the [Parent Holdco / Pledged SPE / Intermediate
Lessee] described on such attached supplemental Schedule II.



          [The undersigned hereby confirms that the property included in the attached Schedule II
constitutes part of the Collateral and hereby makes each representation and warranty set forth in
Section 3.02 of the Security and Guarantee Agreement (as supplemented by the attached Schedule
II).]2



          This Collateral Supplement shall in all respects be governed by, and construed in accordance
with, the laws of the State of New York, including all matters of construction, validity and
performance.





 




			
	2	 	Insert if Collateral Supplement is being
delivered in connection with the formation or acquisition of a Parent Holdco,
Pledged SPE or Intermediate Lessee.





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	 	Very truly yours,



[NAME OF GUARANTOR]3

 	 
	 	By 	



 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 





 




			
	3	 	Conform signature block as appropriate for
Irish or other non-U.S. entities.





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Schedule II

to the

Collateral Supplement




PLEDGED EQUITY




To be [added to] / [removed from] Schedule II to the Security and Guarantee Agreement:




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	Percentage
	 	 	 	 	 	 	 	 	 	 	 	 	of
	 	 	 	 	Class of	 	 	 	 	 	Number	 	Outstanding
	 	 	 	 	Equity	 	Par	 	Certificate	 	of Equity	 	Equity
	Guarantor	 	Issuer	 	Interest	 	Value	 	No(s)	 	Interests	 	Interests
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 





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