Exhibit 10.3


 


 


SECURITY TRUST AGREEMENT


 


 


Dated as of April 26, 2006


 


among


 


 


AERFUNDING 1 LIMITED


 


 


and


 


 


THE ADDITIONAL GRANTORS REFERRED TO HEREIN


as the Grantors


 


 


and


 


 


UBS SECURITIES LLC

as the Administrative Agent


 


 


and


 


 


DEUTSCHE BANK TRUST COMPANY AMERICAS

as Collateral Agent and Account Bank


 


 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  	
   

  	
  Page

  	
   

  
	
  ARTICLE I
  DEFINITIONS

  	
   

  	
   

  	
  2

  	
   

  
	
   

  	
  Section 1.01

  	
  Definitions

  	
   

  	
  2

  	
   

  
	
   

  	
  Section 1.02

  	
  Construction
  and Usage

  	
   

  	
  8

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II
  SECURITY

  	
   

  	
   

  	
  8

  	
   

  
	
   

  	
  Section 2.01

  	
  Grant of
  Security

  	
   

  	
  8

  	
   

  
	
   

  	
  Section 2.02

  	
  Security for
  Obligations

  	
   

  	
  12

  	
   

  
	
   

  	
  Section 2.03

  	
  Representations
  and Warranties of the Grantors

  	
   

  	
  12

  	
   

  
	
   

  	
  Section 2.04

  	
  Grantors
  Remain Liable

  	
   

  	
  15

  	
   

  
	
   

  	
  Section 2.05

  	
  Delivery of
  Collateral

  	
   

  	
  15

  	
   

  
	
   

  	
  Section 2.06

  	
  Maintenance
  of Bank Accounts

  	
   

  	
  15

  	
   

  
	
   

  	
  Section 2.07

  	
  Non-Trustee
  Accounts

  	
   

  	
  17

  	
   

  
	
   

  	
  Section 2.08

  	
  Covenants
  Regarding Assigned Documents

  	
   

  	
  17

  	
   

  
	
   

  	
  Section 2.09

  	
  Covenants
  Regarding Security Collateral, Beneficial Interest Collateral, Membership
  Interest Collateral and Investment Collateral

  	
   

  	
  19

  	
   

  
	
   

  	
  Section 2.10

  	
  Covenants
  Regarding Commercial Tort Claims

  	
   

  	
  20

  	
   

  
	
   

  	
  Section 2.11

  	
  Further
  Assurances

  	
   

  	
  20

  	
   

  
	
   

  	
  Section 2.12

  	
  Place of
  Perfection; Records

  	
   

  	
  21

  	
   

  
	
   

  	
  Section 2.13

  	
  Voting
  Rights; Dividends; Etc

  	
   

  	
  21

  	
   

  
	
   

  	
  Section 2.14

  	
  Transfers
  and Other Encumbrances; Additional Shares or Interests

  	
   

  	
  23

  	
   

  
	
   

  	
  Section 2.15

  	
  Collateral
  Agent Appointed Attorney-in-Fact

  	
   

  	
  23

  	
   

  
	
   

  	
  Section 2.16

  	
  Collateral
  Agent May Perform

  	
   

  	
  24

  	
   

  
	
   

  	
  Section 2.17

  	
  Covenant to
  Pay

  	
   

  	
  24

  	
   

  
	
   

  	
  Section 2.18

  	
  Delivery of
  Collateral Supplements

  	
   

  	
  24

  	
   

  
	
   

  	
  Section 2.19

  	
  Annual
  Opinion

  	
   

  	
  24

  	
   

  
	
   

  	
  Section 2.20

  	
  Covenants
  Regarding Control

  	
   

  	
  25

  	
   

  
	
   

  	
  Section 2.21

  	
  Share
  Mortgage; etc

  	
   

  	
  25

  	
   

  
	
   

  	
  Section 2.22

  	
  Subordination
  of Intercompany Obligations

  	
   

  	
  25

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III
  REMEDIES

  	
   

  	
   

  	
  26

  	
   

  
	
   

  	
  Section 3.01

  	
  Remedies

  	
   

  	
  26

  	
   

  
	
   

  	
  Section 3.02

  	
  Irish
  Conveyancing Acts

  	
   

  	
  27

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV
  SECURITY INTEREST ABSOLUTE

  	
   

  	
  27

  	
   

  
	
   

  	
  Section 4.01

  	
  Security
  Interest Absolute

  	
   

  	
  27

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V
  THE COLLATERAL AGENT

  	
   

  	
  28

  	
   

  
	
   

  	
  Section 5.01

  	
  Authorization
  and Action

  	
   

  	
  28

  	
   

  
	
   

  	
  Section 5.02

  	
  Limitation
  of Duties

  	
   

  	
  29

  	
   

  
	
   

  	
  Section 5.03

  	
  Representations
  or Warranties

  	
   

  	
  29

  	
   

  
	
   

  	
  Section 5.04

  	
  Reliance;
  Agents; Advice of Counsel

  	
   

  	
  29

  	
   

  



 


i

















 


	
   

  	
   

  	
   

  	
   

  	
  Page

  	
   

  
	
   

  	
  Section 5.05

  	
  No
  Individual Liability

  	
   

  	
  31

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI
  SUCCESSOR COLLATERAL AGENTS

  	
   

  	
  31

  	
   

  
	
   

  	
  Section 6.01

  	
  Resignation
  and Removal of Collateral Agent

  	
   

  	
  31

  	
   

  
	
   

  	
  Section 6.02

  	
  Appointment
  of Successor

  	
   

  	
  31

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII
  EXPENSES

  	
   

  	
  32

  	
   

  
	
   

  	
  Section 7.01

  	
  In General

  	
   

  	
  32

  	
   

  
	
   

  	
  Section 7.02

  	
  Reserved

  	
   

  	
  33

  	
   

  
	
   

  	
  Section 7.03

  	
  No
  Compensation from Secured Parties

  	
   

  	
  33

  	
   

  
	
   

  	
  Section 7.04

  	
  Collateral
  Agent and Account Bank Fees

  	
   

  	
  33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII
  MISCELLANEOUS

  	
   

  	
  33

  	
   

  
	
   

  	
  Section 8.01

  	
  Amendments;
  Waivers; Etc

  	
   

  	
  33

  	
   

  
	
   

  	
  Section 8.02

  	
  Addresses
  for Notices

  	
   

  	
  34

  	
   

  
	
   

  	
  Section 8.03

  	
  No Waiver;
  Remedies

  	
   

  	
  35

  	
   

  
	
   

  	
  Section 8.04

  	
  Severability;
  Enforcement

  	
   

  	
  35

  	
   

  
	
   

  	
  Section 8.05

  	
  Continuing
  Security Interest; Assignments

  	
   

  	
  35

  	
   

  
	
   

  	
  Section 8.06

  	
  Release and
  Termination

  	
   

  	
  36

  	
   

  
	
   

  	
  Section 8.07

  	
  Limited
  Recourse

  	
   

  	
  36

  	
   

  
	
   

  	
  Section 8.08

  	
  Governing
  Law

  	
   

  	
  36

  	
   

  
	
   

  	
  Section 8.09

  	
  Jurisdiction

  	
   

  	
  37

  	
   

  
	
   

  	
  Section 8.10

  	
  Counterparts

  	
   

  	
  37

  	
   

  
	
   

  	
  Section 8.11

  	
  Table of
  Contents, Headings, Etc

  	
   

  	
  37

  	
   

  
	
   

  	
  Section 8.12

  	
  Effectiveness;
  Date of this Agreement

  	
   

  	
  37

  	
   

  
	
   

  	
  Section 8.13

  	
  Administrative
  Agent Approvals

  	
   

  	
  37

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULES

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule I

  	
   

  	
  Pledged
  Stock, Pledged Beneficial Interest, Pledged Membership Interest and Pledged
  Debt

  	
   

  	
   

  	
   

  
	
  Schedule II

  	
   

  	
  Non-Trustee
  Account Information

  	
   

  	
   

  	
   

  
	
  Schedule III

  	
   

  	
  Trade Names

  	
   

  	
   

  	
   

  
	
  Schedule IV

  	
   

  	
  Jurisdiction
  of Organization, Chief Place of Business and Chief Executive or Registered
  Office

  	
   

  	
   

  	
   

  
	
  Schedule V

  	
   

  	
  Trust
  Agreements

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  RESERVED

  	
   

  	
   

  	
   

  
	
  Exhibit B-1

  	
   

  	
  Form of
  Collateral Supplement

  	
   

  	
   

  	
   

  
	
  Exhibit B-2

  	
   

  	
  Form of
  Grantor Supplement

  	
   

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
  RESERVED

  	
   

  	
   

  	
   

  
	
  Exhibit D

  	
   

  	
  Form of
  Notice and Acknowledgment

  	
   

  	
   

  	
   

  
	
  Exhibit E

  	
   

  	
  Form of
  Irish Share Mortgage

  	
   

  	
   

  	
   

  
							



 


ii

















 


SECURITY TRUST AGREEMENT


 


This SECURITY
TRUST AGREEMENT (this “Agreement”), dated as of April 26, 2006, is made among
AERFUNDING 1 LIMITED, a company incorporated under the laws of Bermuda (the “Borrower”),
the Aircraft Owning Entities, the Owner Trusts, the Applicable Intermediaries
and other direct or indirect Subsidiaries of the Borrower listed on the
signature pages of, or who otherwise become grantors under, this Agreement
(each, a “Borrower Subsidiary”), the Owner Trustees listed on the signature
pages of, or who otherwise become grantors under, this Agreement (such Owner
Trustees, together with the Borrower Subsidiaries and the Borrower, each a “Grantor”
and collectively the “Grantors”), UBS SECURITIES LLC (“UBSS”), as
Administrative Agent (the “Administrative Agent”), and DEUTSCHE BANK TRUST
COMPANY AMERICAS, a national banking association (“DBTCA”), as Collateral Agent
(as defined below).


 


PRELIMINARY STATEMENTS:


 


(1)           The
Borrower, Administrative Agent and Collateral Agent have entered into that
certain Credit Agreement (the “Credit Agreement”), made and entered into as of
April 26, 2006 among the Borrower, AerCap Ireland Limited and each other
servicer named therein, individually and as servicer (or any successor servicer
appointed pursuant to Section 12.3 of the Credit Agreement, each, a “Service
Provider”), UBS Real Estate Securities Inc. and the other financial
institutions that become parties thereto as Class A Lenders, (together with any
permitted successors and assigns, “Class A Lenders”), UBS Real Estate
Securities Inc. and the other financial institutions that become parties
thereto as Class B Lenders, (together with any permitted successors and
assigns, “Class B Lenders”) and UBS Real Estate Securities Inc. and the other
financial institutions that become parties thereto as Class C Lenders (together
with any permitted successors and assigns, “Class C Lenders” and, together with
Class A Lenders and the Class B Lenders, the “Lenders”), the Administrative
Agent, as agent for the Lenders, UBS Securities LLC as funding agent (the “UBS
Funding Agent”), the Other Funding Agents, and the Collateral Agent as the same
may be amended, modified, supplemented and/or restated from time to time.


 


(2)           Pursuant
to the Credit Agreement, the Borrower may from time to time borrow one or more
Advances from the Lenders.


 


(3)           The
Borrower is the owner, directly or indirectly, of all of the beneficial
interest in certain Borrower Subsidiaries, all of the membership interest in
certain Borrower Subsidiaries and all of the outstanding shares of capital
stock of the other Borrower Subsidiaries, all as described in the attached Schedule
I.


 


(4)           The
Borrower Subsidiaries are, or may from time to time be, parties to lease and
sub-lease contracts and servicing agreements with respect to the Initial
Financed Aircraft, and the Additionally Financed Aircraft.


 


(5)           The
Borrower and the Borrower Subsidiaries may from time to time grant additional
security for the benefit of the Secured Parties.


 

















 


(6)           It
is a condition precedent to the borrowing of any Advance by the Borrower that
each Grantor grant the security interests required by this Agreement.


 


(7)           Each
Grantor will derive substantial direct and indirect benefit and value from the
Borrower’s borrowing of the Advances and from the Transaction Documents.


 


(8)           DBTCA
is willing to act as the Collateral Agent and Account Bank under the Credit
Agreement and as Collateral Agent, Account Bank.


 


(9)           UBSS
is willing to act as the Administrative Agent under the Credit Agreement and
under this Agreement.


 


NOW,
THEREFORE, in consideration of the premises, each Grantor hereby agrees with
the Collateral Agent for its benefit and the benefit of the Secured Parties as
follows:


 


ARTICLE I

DEFINITIONS


 


Section 1.01 Definitions. (a)  Certain Defined Terms. For the
purposes of this Agreement, the following terms have the meanings indicated
below:


 


“Account Bank”
has the meaning assigned such term in the Credit Agreement.


 


“Accounts
Receivable” means all of the Grantor’s now owned or hereafter acquired or
arising accounts, as defined in the UCC, including any rights to payment for
the sale or lease of goods or rendition of services, whether or not they have
been earned by performance.


 


“Additional
Grantor” has the meaning specified in Section 8.01(b).


 


“Administrative
Agent” has the meaning specified in the recital of parties to this Agreement.


 


“Agreement”
has the meaning specified in the recital of parties to this Agreement.


 


“Annual
Opinion Jurisdiction” means each of (i) New York, (ii) Ireland, (iii) Bermuda,
and (iv) with respect only to the perfection of security interests that may be
perfected by filing a financing statement in such jurisdiction, the District of
Columbia.


 


“Applicable
Aviation Authority” means any Government Entity that has responsibility for the
supervision of civil aviation and/or the registration and operations of civil
aircraft.


 


“Applicable
Law” means, with respect to any Person, all laws, rules, regulations and orders
of governmental or regulatory authorities applicable to such Person, including,
without limitation, the regulations of each Applicable Aviation Authority
applicable to such Person or, with respect to a lessee under a Lease, to the
Financed Aircraft operated by it.


 


“Assigned Agreement
Collateral” has the meaning specified in Section 2.01(f).


 


2

















 


“Assigned
Agreements” has the meaning specified in Section 2.01(f).


 


“Assigned
Documents” means, collectively, the Assigned Agreements, the Assigned Leases,
the Service Provider Documents, the Purchase Agreement, and the Hedge
Agreements.


 


“Assigned
Leases” has the meaning specified in Section 2.01(g).


 


“Bank Account”
means any of the Collection Account (including without limitation the Collection
Trust Account and the Collection DDA Account), the Maintenance Reserve Account,
the Security Deposit Account, the Liquidity Reserve Account, the Class C
Reserve Account, the Borrower Funding Account, and all other bank and similar
accounts established with DBTCA relating to Collections with respect to the
Aircraft and the Leases (whether now existing or hereafter established).


 


“Bank Account
Collateral” has the meaning specified in Section 2.01(d).


 


“Beneficial
Interest Collateral” has the meaning specified in Section 2.01(b).


 


“Borrower” has
the meaning specified in the recital of parties to this Agreement.


 


“Borrower
Group Member” means the Borrower or a Borrower Subsidiary.


 


“Borrower
Subsidiary” has the meaning specified in the recital of parties to this
Agreement.


 


“Certificated
Security” means a certificated security as defined in Section 8-102(a)(4) of
the UCC other than a Government Security.


 


“Closing Date”
means April 26, 2006.


 


“Collateral”
has the meaning specified in Section 2.01.


 


“Collateral
Agent” means, for purposes of this Agreement and the other Transaction
Documents and any related agreements or instruments, DBTCA in its capacity as
collateral agent and account bank, together with any of its permitted
successors and assigns.


 


“Collateral
Supplement” means a supplement to this Agreement in substantially the form
attached as Exhibit B-1 executed and delivered by a Grantor.


 


“Commercial
Tort Claim” means any “commercial tort claim” as defined in Section
9-102(a)(13) of the UCC.


 


“Control” has
the meaning specified in Section 2.20.


 


“Control
Agreement” has the meaning specified in Section 2.07(i).


 


“Credit
Agreement” has the meaning set forth in the Preliminary Statements.


 


3

















 


“DBTCA” means
Deutsche Bank Trust Company Americas, in its respective capacities as expressly
provided herein.


 


“Eligible
Institution” means (a) Deutsche Bank Trust Companies Americas in its capacity
as Collateral Agent, so long as it (i) has either (A) a long-term unsecured
debt rating of AA- (or the equivalent) or better by each Rating Agency or (B) a
short-term unsecured debt rating of A-1 by Standard & Poor’s and P-1 by
Moody’s and (ii) can act as a securities intermediary under the New York
Uniform Commercial Code; (b) any bank organized under the laws of the United
States of America or any state thereof, or the District of Columbia (or any
branch of a foreign bank licensed under any such laws), so long as it (i) has
either (A) a long-term unsecured debt rating of AA (or the equivalent) or
better by each Rating Agency or (B) a short-term unsecured debt rating of A-1+
by Standard & Poor’s and P-1 by Moody’s and (ii) can act as a securities
intermediary under the New York Uniform Commercial Code; and (c) any other foreign
bank or financial institution reasonably acceptable to the Administrative
Agent.


 


“Excluded
Payments” means, with respect to any Aircraft, its related Lease and the
Related Security, (i) indemnity or similar payments (whether or not payable as
supplemental rent) paid or payable by the Lessee under such Lease to the
indemnitee or other payee entitled thereto pursuant to such Lease or any
related agreements (unless such indemnitee or other payee is a Borrower Group
Member or had previously been reimbursed pursuant to Section 8.1(e) of the
Credit Agreement for any expense or loss related to such indemnity or similar
payments), (ii) proceeds of public liability insurance in respect of the
Aircraft payable as a result of insurance claims made, or losses suffered, by
the indemnitee or payee entitled thereto (unless the recipient of such proceeds
is a Borrower Group Member or had previously been reimbursed pursuant to
Section 8.1(e) of the Credit Agreement for any expense or loss related to the
payment of such proceeds), (iii) proceeds of hull insurance maintained with
respect to any Aircraft by the relevant Aircraft Owning Entity or any Affiliate
of such Aircraft Owning Entity (including a Service Provider) and not required
under the then-current Lease or under this Agreement or any other Transaction
Documents for the Aircraft (it being agreed that only liability related
insurance proceeds under the Contingent Policy shall be Excluded Payments),
(iv) any interest paid or payable on any amounts described in clauses (i)
through (iii) of this definition, and (v) the proceeds from the enforcement by
the relevant Aircraft Owning Entity or other indemnitee or payee of the payment
of any amount described in clauses (i) through (iv) of this definition.


 


“Financed
Aircraft” means any Initial Financed Aircraft and any Additionally Financed
Aircraft.


 


“Government
Security” means any security that is issued or guaranteed by the United States
of America or an agency or instrumentality thereof and that is maintained in
book-entry on the records of the Federal Reserve Bank of Chicago (or any other
Federal Reserve Bank Branch) and is subject to the Revised Book-Entry Rules.


 


“Grantor” has
the meaning specified in the recital of parties to this Agreement.


 


“Grantor
Supplement” means a supplement to this Agreement in substantially the form
attached as Exhibit B-2 executed and delivered by a Grantor.


 


4

















 


“Hedge
Agreement Collateral” has the meaning specified in Section 2.01(l).


 


“Instrument”
means any “instrument” as defined in Section 9-102(a)(47) of the UCC.


 


“Intercompany
Obligations” means the obligations of any Borrower Subsidiary to the Borrower
including without limitation under the Loan, Expenses Apportionment and
Guarantee Agreement dated on or about the date hereof.


 


“Interim
Charters” has the meaning assigned such term in the Purchase Agreement.


 


“Investment
Collateral” has the meaning specified in Section 2.01(e).


 


“Irish Share
Mortgage” means an Irish-law-governed mortgage of Shares in substantially the
form of Exhibit E.


 


“Lease” means
(a) any lease agreement between an Aircraft Owning Entity or an Applicable
Intermediary, as lessor of an Aircraft, and an airline, air freight company or
similar entity, as lessee of such Aircraft, in each case together with all
schedules, supplements and amendments thereto, as such may be amended, restated
and/or otherwise modified from time to time, or (b) any lease agreement between
an Aircraft Owning Entity, as lessor of an Aircraft, and an Applicable
Intermediary, as lessee of an Aircraft, in each case together with all
schedules, supplements and amendments thereto, as such may be amended, restated
and/or otherwise modified from time to time.


 


“Lease
Assignment Documents” means, in respect of any Assigned Lease, (a) any
agreement providing for the novation thereof to substitute, or the assignment
thereof to, a Borrower Subsidiary as the lessor, (b) any agreement or
instrument supplemental to this Agreement for the purpose of effecting and/or perfecting
the assignment of, and the grant of a lien upon, such Assigned Lease in favor
the Collateral Agent under any Applicable Law, (c) any notice provided to the
lessee thereof of the assignment thereof pursuant to this Agreement and/or such
supplement, (d) any acknowledgment of such assignment by such lessee and (e)
any undertaking of quiet enjoyment given by the Collateral Agent in respect
thereof, in each case as such may be amended, restated and/or otherwise
modified from time to time.


 


“Lease Collateral”
has the meaning specified in Section 2.01(g).


 


“Lenders” has
the meaning set forth in the Preliminary Statements.


 


“Letter of
Credit” means any “letter of credit” as defined in Section 5-102 of the UCC.


 


“Letter of
Credit Right” means any “letter of credit right” as defined in Section
9-102(a)(51) of the UCC.


 


“Membership
Interest Collateral” has the meaning specified in Section 2.01(c).


 


5

















 


“Non-Trustee
Account Banks” has the meaning specified in Section 2.07.


 


“Non-Trustee
Account Collateral” has the meaning specified in Section 2.01(r).


 


“Notice and
Acknowledgement” has the meaning assigned such term in the Credit Agreement.


 


“Officer’s
Certificate” means a certificate signed by, with respect to any Person, any
authorized officer, director, trustee or equivalent representative of such
Person.


 


“Opinion of
Counsel” means a written opinion of counsel, who may be counsel for the
Borrower, and who shall be reasonably acceptable to the Collateral Agent and Administrative
Agent.


 


“Pledged
Beneficial Interests” means the beneficial interests identified in any of Schedule
I, any Collateral Supplement or any Grantor Supplement.


 


“Pledged Debt”
means the Intercompany Obligations and the indebtedness identified in any of Schedule
I, any Collateral Supplement or any Grantor Supplement.


 


“Pledged
Membership Interests” means the membership interests identified in any of Schedule
I, any Collateral Supplement or any Grantor Supplement.


 


“Pledged Stock”
means the capital stock identified in any of Schedule I, any Collateral
Supplement or any Grantor Supplement.


 


“Purchase
Agreement” has the meaning assigned the term “AerCap-Borrower Purchase
Agreement” in the Credit Agreement and shall include all other agreements,
assignments, documents, bills of sale or other instruments forming a part of
the transaction documents with respect thereto, including without limitation
the Deed of Tax Indemnity (as defined in the Purchase Agreement).


 


“Relevant
Collateral” has the meaning specified in Section 2.09(a).


 


“Rental
Payments” means all rental and lease payments and other amounts equivalent to a
rental or lease payment payable by or on behalf of an Obligor (including, for
the purposes hereof, an Applicable Intermediary) under a Lease, including any
payments pursuant to a contractual option granted by the lessor or owner
(including pursuant to a conditional sale agreement) as to the purchase of the
applicable Aircraft.


 


“Responsible
Officer” means, with respect to the Collateral Agent, Gary Severyn, or such
other individual as may be appointed by the Collateral Agent from time to time.


 


“Revised
Book-Entry Rules” means 31 C.F.R. § 357 (Treasury bills, notes and bonds); 12
C.F.R. § 615 (book-entry securities of the Farm Credit Administration); 12
C.F.R. §§ 910 and 912 (book-entry securities of the Federal Home Loan Banks);
24 C.F.R. § 81 (book-entry securities of the Federal National Mortgage
Association and the Federal Home Loan Mortgage Corporation); 12 C.F.R. § 1511
(book-entry securities of the Resolution Funding


 


6

















 


Corporation or
any successor thereto); 31 C.F.R. § 354 (book-entry securities of the Student
Loan Marketing Association); and any substantially comparable book-entry rules
of any other Federal agency or instrumentality of the United States.


 


“Secured
Obligations” means the Obligations under, and as defined in, the Credit
Agreement.


 


“Secured Party”
means any of or, in the plural form, all of the Collateral Agent, the Administrative
Agent, each Funding Agent and each Lender.


 


“Securities
Account” means a securities account as defined in Section 8-501(a) of the UCC
maintained in the name of the Collateral Agent as “entitlement holder” (as
defined in Section 8-102(a)(7) of the UCC) on the books and records of any
Securities Intermediary who has agreed that its securities intermediary
jurisdiction (within the meaning of Section 8-116 of the UCC) is the State of
New York; provided, that, such securities account is governed by documentation
(if required by the Administrative Agent) reasonably satisfactory to the
Administrative Agent and is otherwise reasonably satisfactory to the
Administrative Agent.


 


“Securities
Intermediary” means any “securities intermediary” of the Collateral Agent as
defined in 31 C.F.R. Section 357.2 or Section 8-102(a)(14) of the UCC;
provided, that, such securities intermediary is reasonably satisfactory to the
Administrative Agent.


 


“Security
Collateral” has the meaning specified in Section 2.01(a).


 


“Service Provider”
means the service providers with respect to any Service Provider Document
described in clause (a) or (b) of the definition thereof.


 


“Service
Provider Documents” means (a) each Service Provider Agreement, (b) the
Guaranty, and (c) any other service agreement with respect to the Aircraft
entered into by a Borrower Group Member in accordance with the Credit
Agreement.


 


“Servicing
Collateral” has the meaning specified in Section 2.01(h).


 


“Supporting
Obligation” means any “supporting obligation” as defined in Section
9-102(a)(77) of the UCC.


 


“UBSS” has the
meaning specified in the recital of parties to this Agreement.


 


“UCC” means,
as of any date, the Uniform Commercial Code as in effect on such date in the
State of New York; provided that if by reason of mandatory provisions of law,
the perfection or the effect of perfection or non-perfection of the security
interest in any Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than New York, “UCC” means the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions of this Agreement relating to such perfection or effect of
perfection or non-perfection.


 


“Uncertificated
Security” means an uncertificated security as defined in Section 8-102(a)(18)
of the UCC other than a Government Security.


 


7

















 


(b)           Terms
Defined in the Credit Agreement. For all purposes of this Agreement, all
capitalized terms used, but not defined, in this Agreement shall have the
respective meanings assigned to such terms in the Credit Agreement.


 


Section
1.02  Construction and Usage.
The conventions of construction and usage set forth in Section 1.2 of the
Credit Agreement are hereby incorporated by reference in this Agreement.


 


ARTICLE II

SECURITY


 


Section
2.01  Grant of Security. To
secure the Secured Obligations, each Grantor hereby assigns and pledges to the
Collateral Agent for its benefit and the benefit of the Secured Parties, and
hereby grants to the Collateral Agent for its benefit and the benefit of the
Secured Parties, a security interest (which with respect to the Bank Account
Collateral and Non-Trustee Account Collateral is intended to be a fixed charge)
in, all of such Grantor’s right, title and interest in, to and under (the
following being referred to herein as, collectively, the “Collateral”):


 


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


 


(i)            the Pledged Stock and
the certificates representing such Pledged Stock, and all dividends, 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 Stock;


 


(ii)           the Pledged Debt and
all instruments evidencing the Pledged Debt, and 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;


 


(iii)          all additional shares of
the capital stock of any Borrower Subsidiary (whether now existing or hereafter
created) from time to time acquired by such Grantor in any manner, including
the capital stock of any Borrower Subsidiary that may be formed from time to
time, and all certificates, if any, representing such additional shares of the
capital stock and all dividends, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all such additional shares; and


 


(iv)          all additional
indebtedness from time to time owed to such Grantor by any Person and the
instruments evidencing such indebtedness, and 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 such indebtedness;


 


8

















 


(b)           all
of the following (the “Beneficial Interest Collateral”):


 


(i)            the Pledged Beneficial
Interests, all certificates, if any, from time to time representing all of such
Grantor’s right, title and interest in the Pledged Beneficial Interests, any
contracts and instruments pursuant to which any such Pledged Beneficial
Interests are created or issued and 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 Pledged Beneficial
Interests; and


 


(ii)           all of such Grantor’s
right, title and interest in all additional beneficial interests in any
Borrower Subsidiary (whether now existing or hereafter created), from time to
time acquired by such Grantor in any manner, including the beneficial interests
in any Borrower Group Member that may be formed from time to time, and all
certificates, if any, from time to time representing such additional beneficial
interests and 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 such additional beneficial interests;


 


(c)           all
of the following (the “Membership Interest Collateral”):


 


(i)            the Pledged Membership
Interests, all certificates, if any, from time to time representing any of such
Grantor’s right, title and interest in the Pledged Membership Interests, any
contracts and instruments pursuant to which any such Pledged Membership
Interests are created or issued and 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 Pledged Membership Interest;
and


 


(ii)           all of such Grantor’s
right, title and interest in all additional membership interests in any
Borrower Subsidiary (whether now existing or hereafter created) from time to
time acquired by such Grantor in any manner, all certificates, if any, from
time to time representing such additional membership interests and 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
such additional membership interests;


 


(d)           all
of the following (collectively, the “Bank Account Collateral”):


 


(i)            each Bank Account at
any time or from time to time established; and


 


(ii)           all cash, investment
property, Eligible Investments, other investments, securities, instruments or
other property (including all “financial assets” within the meaning of Section
8-102(a)(9) of the UCC) at any time or from time to time credited to any such
Bank Account;


 


9

















 


(e)           all
other “investment property” as defined in Section 9-102(a)(49) of the UCC of
such Grantor (the “Investment Collateral”) including any interest, dividends,
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 Investment Collateral provided that such investment property is
related to the Investment Collateral;


 


(f)            all
of the following (the “Assigned Agreement Collateral”):


 


(i)            all of such Grantor’s
right, title and interest in and to all security assignments, cash deposit
agreements and other security agreements executed in its favor, with respect to
the Aircraft or any of the Leases in each case as such agreements may be
amended, restated and/or otherwise modified from time to time (collectively,
the “Assigned Agreements”); and


 


(ii)           all of such Grantor’s
right, title and interest in and to all deposit accounts, all funds or other
property held in such deposit accounts, all certificates and instruments, if
any, from time to time representing or evidencing such deposit accounts and all
other property of whatever nature, in each case pledged, assigned or
transferred to it or mortgaged or charged in its favor pursuant to any Assigned
Document and all Supporting Obligations relating to any Assigned Agreement;


 


(g)           all
of such Grantor’s right, title and interest in, to and under all Leases to
which such Grantor is or may from time to time be party and any leasing
arrangements among Borrower Group Members (whether now existing or hereafter
created) with respect to such Leases together with all Related Security with
respect thereto (all such Leases and Related Security, the “Assigned Leases”),
including, without limitation, (i) all rights of such Grantor to receive Rental
Payments and other moneys due and to become due under or pursuant to such
Assigned Leases, (ii) all rights of such Grantor to receive proceeds of any
insurance, indemnity, warranty or guaranty pursuant to, or with respect to,
such Assigned Leases, (iii) claims of such Grantor for damages arising out of
or for breach or default under such Assigned Leases, (iv) all rights under any
such Assigned Lease with respect to any subleases of the Aircraft subject to
such Assigned Lease and (v) the right of such Grantor to terminate such
Assigned Leases and to compel performance of, and otherwise to exercise all
remedies under, any Assigned Lease, whether arising under such Assigned Leases
or by statute, at law or in equity (the “Lease Collateral”);


 


(h)           all
of such Grantor’s right, title and interest in, to and under each Service
Provider Document, including, without limitation, (i) all rights of such
Grantor to receive any moneys due or payable under or pursuant to such Service
Provider Document, (ii) any claims of such Grantor for damages arising out of,
or for breach or default under, such Service Provider Document and (iii) all
rights to compel performance under such Service Provider Document, and
otherwise to exercise any and all remedies under such Service Provider
Document, in each case, whether arising under such Service Provider Document by
statute, at law or in equity (the “Servicing Collateral”);


 


(i)            [Reserved];


 


10

















 


(j)            all
of such Grantor’s right, title and interest in, to and under the Purchase
Agreement and the Purchase Agreement Guaranty, including, without limitation,
(i) all rights of such Grantor to receive moneys due or to become due under or
pursuant to the Purchase Agreement or the Purchase Agreement Guaranty, (ii) any
claims of such Grantor for damages arising out of, or for breach or default
under, the Purchase Agreement or the Purchase Agreement Guaranty and (iii) all
right to compel performance of the Vendors (as defined in the Purchase Agreement)
under the Purchase Agreement or AerCap Holdings C.V. under the Purchase
Agreement Guaranty, and otherwise to exercise any and all remedies under the
Purchase Agreement and Purchase Agreement Guaranty, in each case, whether
arising under the Purchase Agreement or Purchase Agreement Guaranty by statute,
at law or in equity;


 


(k)           [Reserved];


 


(l)            with
respect to the Borrower, all of the Borrower’s right, title and interest in, to
and under each Hedge Agreement, including, without limitation, (i) all rights
of the Borrower to receive moneys due or to become due under or pursuant to
such Hedge Agreement, (ii) any claims of the Borrower for damages arising out
of, or for breach or default under, such Hedge Agreement and (iii) all rights
to compel performance of the counterparty under such Hedge Agreement, and
otherwise to exercise any and all remedies under such Hedge Agreement, in each
case, whether arising under such Hedge Agreement by statute, at law or in
equity (the “Hedge Agreement Collateral”).


 


(m)          with
respect to each Grantor, all of such Grantor’s right, title and interest in and
to the personal property identified in a Grantor Supplement or a Collateral
Supplement executed and delivered by such Grantor to the Collateral Agent;


 


(n)           with
respect to each Grantor, all of such Grantor’s Accounts Receivable;


 


(o)           all
Commercial Tort Claims;


 


(p)           all
of such Grantor’s Letters of Credit and Letter-of-Credit Rights;


 


(q)           all
books, records and other property related to or referring to any of the
foregoing, including books, records, account ledgers, data processing records,
computer software and other property and general intangibles at any time
evidencing or relating to any of the foregoing; and


 


(r)            all
of the following (collectively, the “Non-Trustee Account Collateral”):


 


(i)            all of the Non-Trustee
Accounts (including without limitation any Hong Kong Holding Account or London
Holding Account not maintained at DBTCA) in such Grantor’s name, all funds or
any other interest held or required by the terms of the Credit Agreement to be
held in, and all certificates and instruments, if any, from time to time
representing or evidencing, such Non-Trustee Accounts;


 


(ii)           all notes, certificates
of deposit, deposit accounts, checks and other instruments from time to time
hereafter delivered to or otherwise possessed by


 


11

















 


such Grantor
or by the Collateral Agent for or on behalf of such Grantor in substitution for
or in addition to any or all of the then existing Non-Trustee Account
Collateral; and


 


(iii)          all interest, dividends,
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 Non-Trustee Account Collateral; and


 


(s)           all
proceeds of any and all of the foregoing Collateral (including proceeds that
constitute property of the types described above);


 


provided,
however, that in all cases Excluded Payments shall be excluded from the
Collateral and all distributions and dividends or other payments that are
received as a result of a distribution in accordance with Section 8.1(e) of the
Credit Agreement shall be excluded from the Collateral.


 


Section
2.02  Security for Obligations.
This Agreement secures the payment and performance by the Grantors of all
Secured Obligations and the security interests and other rights and benefits
granted hereunder shall be held by the Collateral Agent in trust for the
Secured Parties. Without limiting the generality of the foregoing, this
Agreement secures the payment of all amounts that constitute part of the
Secured Obligations and would be owed by any Grantor to any Secured Parties but
for the fact that such Secured Obligations are unenforceable or not allowed due
to the existence of a bankruptcy, reorganization or similar proceeding
involving such Grantor.


 


Section
2.03  Representations and
Warranties of the Grantors. Each Grantor represents and warrants as of the
date of this Agreement, as of the Initial Advance Date, as of the date of each
Additional Advance and as of each Payment Date, as follows:


 


(a)           The
Grantors are the legal and beneficial owners of the Collateral and the Aircraft
free and clear of any Adverse Claims. No effective financing statement or other
instrument similar in effect covering all or any part of the Collateral or the
Aircraft is on file in any recording office, except such as may have been filed
with respect to the Collateral in favor of the Collateral Agent.


 


(b)           This
Agreement creates a valid and (upon the taking of the actions described in
clauses (iii)(1), (iii)(2), (iii)(3), (iii)(4), (iii)(5), and (iii)(6) of
Section 2.03(d), each of which has been duly taken or, in the case of the
actions described in clause (iii)(5) shall be taken within the period specified
in such clause) perfected security interest in the Collateral as security for
the Secured Obligations, and such security interest is subject in priority to
no other Liens, and all filings and other actions necessary or desirable to
perfect and protect such security interest have been (or in the case of (i)
actions described in such clause (iii)(5) and (ii) actions in respect of future
Collateral, shall be) duly taken. The Borrower has on the date of this
Agreement delivered to the Administrative Agent on behalf of the Collateral
Agent an original counterpart of this Agreement and the Irish Share Mortgage
for the Pledged Stock specified on Schedule I, duly executed by the Borrower,
and no other action is required to be taken by it or by any Borrower Subsidiary
in order for the filings described in such clause (iii)(v) to be duly made by
the Collateral Agent or the Administrative Agent on its behalf. Other than (i)
the security interest granted to the Collateral Agent pursuant to this
Agreement or any security interest


 


12

















 


previously
granted that shall be terminated as of the date hereof, (ii) as expressly
permitted by the Credit Agreement, the Grantors have not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Collateral. The Grantors have not authorized the filing of, and are not aware
of, any financing statements or other instrument similar in effect against any
Grantor or any Aircraft that include a description of collateral covering the
Collateral or any Aircraft other than any financing statement relating to the
security interest ranted o the Collateral Agent hereunder or that has been
terminated. The Grantors are not aware of any judgment or tax lien filings
against any Grantor or with respect to any Collateral or any Aircraft.


 


(c)           No
Grantor has any trade names except as set forth on Schedule III hereto.


 


(d)           No
consent of any other Person and no authorization, approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
or other third party is required for (i) the grant by such Grantor of the
assignment and security interest granted hereby, (ii) the execution, delivery
or performance of this Agreement by such Grantor or (iii) the perfection,
priority or maintenance of the pledge, assignment and security interest created
hereby, except for (1) the filing of financing and continuation statements
under the UCC, (2) the filing of this Security Trust Agreement (and any Grantor
Supplement or Collateral Supplement) with the FAA with respect to each Aircraft
registered in the United States, (3) any filing of this Agreement (and any
Grantor Supplement or Collateral Supplement) or Notice of Acknowledgement or
other documents relating thereto required with respect to a foreign
jurisdiction, (4) filings where appropriate with the International Registry
created pursuant to the Convention on International Interests in Mobile
Equipment and the Protocol thereto relating to Aircraft Equipment, (5) the
filing by a Grantor incorporated in Ireland or a Grantor with a place of
business or assets (including without limitation shares in a company organized
under the law of Ireland) located in Ireland of this Agreement (and any Grantor
Supplement or Collateral Supplement) and the filing by any Grantor of an Irish
Share Mortgage, with the Irish Registrar of Companies and the Irish Revenue
Commissioners within 21 days following the execution and delivery by such
Grantor of this Agreement (and any Grantor Supplement or Collateral Supplement)
or of such Irish Share Mortgage, respectively and (6) the filing by the
Borrower and any other Grantor organized under the law of Bermuda of this
Agreement (and any Grantor Supplement or Collateral Supplement executed by it)
with the appropriate register of Bermuda.


 


(e)           The
jurisdiction of organization, organizational ID Number (for a non-U.S. entity,
to the extent a Government Entity in the jurisdiction of domicile of such
entity issues such ID Numbers), the chief place of business and chief executive
or registered office of such Grantor and the office where such Grantor keeps
records of the Collateral are located at the address specified opposite the
name of such Grantor on the attached Schedule IV.


 


(f)            The
Pledged Stock constitutes the percentage of the issued and outstanding shares
of capital stock of the issuers thereof indicated on the attached Schedule I
hereto. The Pledged Membership Interest constitutes the percentage of the
membership interest of the issuer thereof indicated on Schedule I hereto.
The Pledged Beneficial Interest constitutes the percentage of the beneficial
interest of the issuer thereof indicated on Schedule I hereto.


 


(g)           The
Pledged Stock, the Pledged Membership Interests and the Pledged Beneficial
Interests have been duly authorized and validly issued and are fully paid and


 


13

















 


nonassessable
(or, in the case of Pledged Membership Interests and Pledged Beneficial
Interests, not subject to any capital call or other additional capital
requirement) and not subject to any preemptive rights, warrants, options or
similar rights or restrictions in favor of third parties or any contractual or
other restrictions upon transfer other than as may be permitted or required
under the Credit Agreement. The Pledged Debt has been duly authorized,
authenticated or issued and delivered, is the legal, valid and binding
obligation of each obligor thereunder and is not in default.


 


(h)           All
certificates or instruments evidencing the Pledged Stock, the Pledged
Beneficial Interests and the Pledged Membership Interests have been delivered
to the Collateral Agent. The Pledged Stock, the Pledged Beneficial Interests
and the Pledged Membership Interests either (i) are in bearer form, (ii) have
been endorsed, by an effective endorsement, to the Collateral Agent or in blank
or (iii) have been registered in the name of the Collateral Agent. None of the
certificates or instruments evidencing Pledged Stock, the Pledged Beneficial
Interests and the Pledged Membership Interests have any marks or notations
indicating that they have been pledged, assigned or otherwise conveyed to any
Person other than the Collateral Agent.


 


(i)            A
true and complete copy of each Assigned Document has been delivered to the
Collateral Agent. Each Assigned Document has been duly authorized, executed and
delivered by all parties thereto and is in full force and effect and is binding
upon and enforceable against the respective Borrower Group Member in accordance
with its terms, except as such enforceability may be limited by (i) applicable
bankruptcy, insolvency, reorganization or other similar, and (ii) general
principles of equity.


 


(j)            Except
as provided in Section 7.1(h)(vi) or 7.2(f) of the Credit Agreement, a true and
complete original copy of each Lease to which a Borrower Subsidiary is a party
has been delivered to the Collateral Agent. Each such Lease has been duly
authorized, executed and delivered by all parties thereto, is in full force and
effect and is binding upon and enforceable against each Borrower Group Member
which is a party thereto in accordance with its terms. Each Lease constitutes “tangible
chattel paper” within the meaning of Section 9-102(a)(78) of the UCC. No such
Lease has any marks or notations indicating that it has been pledged, assigned
or otherwise conveyed to any Person other than the Collateral Agent.


 


(k)           Each
Bank Account located in the United States constitutes a “deposit account”
within the meaning of Section 9-102(a)(29) of the UCC or a Securities Account.


 


(l)            Each
of the Hedge Agreements and the Purchase Agreement constitutes “general
intangibles” within the meaning of Section 9-102(a)(42) of the UCC.


 


(m)          Each
direct or indirect Subsidiary of the Borrower as of the date hereof is a
signatory of this Agreement.


 


(n)           The
Pledged Stock, the Pledged Beneficial Interests and the Pledged Membership
Interests listed on Schedule I hereto constitute all of the outstanding
shares of capital stock, all of the beneficial interests and all of the
membership interests in all of the direct and indirect Subsidiaries of the
Borrower as of the date hereof.


 


14

















 


Section
2.04  Grantors Remain Liable.
Anything contained herein to the contrary notwithstanding, (a) each Grantor
shall remain liable under the contracts and agreements included in the
Collateral to the extent set forth therein to perform all of its duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Collateral Agent of any of its rights
hereunder shall not release any Grantor from any of its duties or obligations
under the contracts and agreements included in the Collateral and (c) no
Secured Party shall have any obligation or liability under the contracts and
agreements included in the Collateral by reason of this Agreement, nor shall
any Secured Party be obligated to perform any of the obligations or duties of
any Grantor under the contracts and agreements included in the Collateral or to
take any action to collect or enforce any claim for payment assigned under this
Agreement.


 


Section
2.05  Delivery of Collateral.
All certificates, instruments, documents or tangible chattel paper representing
or evidencing any Collateral shall be delivered to and held by the Collateral
Agent in the State of New York and shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to evidence the
security interests granted hereby. Upon the occurrence and during the
continuance of an Event of Default or if the Facility Termination Date has
occurred or been declared under the terms of the Credit Agreement, the Collateral
Agent shall have the right at any time and without notice to any Grantor to
transfer to or to register in the name of the Collateral Agent or any of its
nominees any or all of the Pledged Stock, Pledged Membership Interest and
Pledged Beneficial Interest, in each case, in accordance with the direction of
the Administrative Agent. In addition, the Collateral Agent shall have the
right at any time upon the occurrence and during the continuance of an Event of
Default or if the Facility Termination Date has occurred or been declared under
the terms of the Credit Agreement, to exchange certificates or instruments
representing or evidencing any Collateral for certificates or instruments of
smaller or larger denominations in each case, in accordance with the direction
of the Administrative Agent. To the extent provided in Section 7.01(h)(vi) or
7.02(f)(vi) of the Credit Agreement, each Grantor shall cause the true and
complete original copy or the chattel paper original of each Lease to which it
is a party from time to time to be delivered to the Collateral Agent in the
State of New York on or before the date hereof. With respect to each Future
Lease with a Lessor that is located within a State (or the District of
Columbia) within the United States (within the meaning of Article 9 of the
UCC),the Grantors, or a Service Provider on their behalf, shall cause the
lessor and the Lessee of such Lease to designate one executed copy thereof the
original by adding substantially the following language to the cover page
thereof:  “To the extent, if any, that
this Lease Agreement constitutes chattel paper (as such term is defined in the
Uniform Commercial Code as in effect in any applicable jurisdiction) this copy
shall constitute the sole original thereof and no security interest in this
Lease Agreement may be created through the transfer or possession of any
counterpart other than this counterpart,” cause the delivery of such original
copy and any related lease supplement to the Collateral Agent no later than 15
days after the execution and delivery of such Lease by all its parties, and
also cause the lessor and Lessee to mark each other executed counterpart of
such Lease with the words “DUPLICATE ORIGINAL”.


 


Section
2.06  Maintenance of Bank
Accounts. (a)  DBTCA, in its capacity
as Collateral Agent, hereby acknowledges its appointment as the initial Account
Bank. Upon the execution of this Agreement, the Account Bank shall establish
(or shall have established) the following


 


15

















 


segregated
non-interest-bearing trust accounts:  the
Collection Trust Account, the Maintenance Reserve Account, the Security Deposit
Account, the Class C Reserve Account, the Borrower Funding Account, and the
Liquidity Reserve Account. Additionally, upon the execution of this Agreement,
the Account Bank shall establish (or shall have established) as demand deposit
accounts, the Collection DDA Account. The Account Bank hereby agrees to
establish and maintain each such account, together with any other Bank Accounts
established from time to time (in each case as a Securities Account), on the
books and records of its office specified in Section 8.02 in the name of the
Borrower. If, at any time, the Account Bank ceases to be an Eligible
Institution, the Account Bank agrees to cooperate with any replacement Account
Bank as to the transfer of any property in, and records relating to, any Bank
Account maintained by it to a new Bank Account having the same characteristics
as such other Bank Account and maintained by such replacement Account Bank, and
the Account Bank shall, in any event, use its best efforts to effect such
transfer within 10 Business Days. Except (i) as a Secured Party in accordance
with the provisions of this Agreement and (ii) in its capacity as Collateral
Agent for the benefit of the Secured Parties, DBTCA waives any claim or lien
against any Bank Account it may have, by operation of law or otherwise, for any
amount owed to it by any Grantor.


 


(b)           The
Account Bank hereby agrees that (i) it is a “bank” (as defined in Section
9-101(a)(8) of the UCC), (ii) each Bank Account is and will be maintained as a
Securities Account of which the Account Bank is the Securities Intermediary and
in respect of which the Borrower is the “entitlement holder” (as defined in
Section 8-102(a)(7) of the UCC) of the “security entitlement” (as defined in
Section 8-102(a)(17) of the UCC) with respect to each “financial asset” (as
defined in Section 8-102(a)(9) of the UCC) credited to such Bank Account, (iii)
the Account Bank shall comply with all entitlement orders (as defined in
Section 8-102 of the UCC) originated by the Administrative Agent without
further consent of the Borrower, as the entitlement holder, the other Grantors
or any of them, or any other person, (iv) all Collections and other cash
required to be deposited in any such Bank Account and Eligible Investments and
all other property acquired with cash credited to any such Bank Account will be
processed and credited to such Bank Account in accordance with the Account Bank’s
customary procedures, (v) all items of property (whether cash, investment
property, Eligible Investments, other investments, securities, instruments or
other property credited to each Bank Account will be treated as a “financial
asset” (as defined in Section 8-102(a)(9) of the UCC) under Article 8 of the
UCC, (vi) its “securities intermediary’s jurisdiction” (as defined in Section
8-110(e) of the UCC) and the “bank’s jurisdiction” (within the meaning of
Section 9-304 of the UCC) with respect to each Bank Account is the State of New
York and (vii) all securities, instruments and other property in order or
registered from and credited to any Bank Account shall be payable to or to the
order of, or registered in the name of, the Collateral Agent or shall be
endorsed to the Collateral Agent or in blank, and in no case whatsoever shall
any “financial asset” (as defined in Section 8-102(a)(9) of the UCC) credited
to any Bank Account be registered in the name of any Grantor, payable to or to
the order of any Grantor or specially indorsed to any Grantor except to the
extent the foregoing have been specially endorsed by the applicable Grantor to
the Collateral Agent or in blank.


 


(c)           The
Account Bank acknowledges that that unless and until it is notified by the
Administrative Agent, in writing, to the contrary, the Account Bank will follow
the written directions and instructions of the Cash Manager with respect to the
Bank Accounts.


 


16

















 


(d)           The
Collateral Agent agrees that it will hold (and will indicate clearly in the
books and records that it holds) its “security entitlement” to the “financial
assets” credited to each Bank Account in trust for the benefit of the Secured
Parties.


 


Section
2.07  Non-Trustee Accounts. With respect to each Non-Trustee
Account to be established or established by any Grantor:


 


(i)            Such Grantor shall
maintain such Non-Trustee Account in its name only with an Eligible Institution
(each such institution, a “Non-Trustee Account Bank”) that has entered into a
control agreement in from and substance satisfactory to the Administrative
Agent (a “Control Agreement”).


 


(ii)           Each Grantor shall
immediately instruct each Obligor to make any payment not required to be made
to a Bank Account to a Non-Trustee Account meeting the requirements of Section
2.07(i).


 


(iii)          Upon any termination of
any Control Agreement or other agreement with respect to the maintenance of a
Non-Trustee Account by any Grantor or any Non-Trustee Account Bank, such
Grantor shall immediately notify all Obligors that were making payments to such
Non-Trustee Account to make all future payments to another Non-Trustee Account
meeting the requirements of Section 2.07(i). Subject to the terms of any Lease,
upon request by the Collateral Agent or the Administrative Agent, each Grantor
shall, and if prohibited from so doing by the terms of any Lease, shall use its
best efforts to, seek the consent of the relevant Lessee to, terminate any or
all of its Non-Trustee Accounts.


 


Section
2.08  Covenants Regarding
Assigned Documents. (a)  Upon the
inclusion of any Assigned Document (other than an Assigned Lease, an Assigned
Agreement, or the Purchase Agreement) in the Collateral, the relevant Grantor
will deliver to the Collateral Agent a consent, in substantially the form of
Exhibit D and executed by each party to such Assigned Document (other than any
Grantor) or (where the terms of such Assigned Document expressly provide for a
consent to its assignment for security purposes to substantially the same
effect as Exhibit D) will give due notice to each such other party to such
Assigned Document of its assignment pursuant to this Agreement.


 


(b)           Subject
to the provisions of Article VII of the Credit Agreement, upon the inclusion of
any Assigned Lease in the Collateral, the relevant Grantor will deliver to the
Collateral Agent a fully executed Notice and Acknowledgment and all other such
consents, acknowledgments and/or notices as are (i) necessary under the terms
of such Assigned Lease, (ii) necessary under any and all Applicable Law with
respect to the related lessor and lessee and the jurisdiction governing such
Assigned Lease in order to effect and perfect the assignment of, and grant of a
security interest in, such Assigned Lease pursuant to this Agreement or (iii)
necessary to assure the payment of all Rental Payments and other payments under
such Assigned Lease to the appropriate Bank Accounts or Non-Trustee Account in
accordance with the terms of the Credit Agreement.


 


(c)           [Reserved.]


 


17

















 


(d)           [Reserved.]


 


(e)           Upon
(i) the inclusion of any Assigned Document in the Collateral (other than an
Assigned Lease) or (ii) the amendment or replacement of any Assigned Document
or (iii) the entering into of any new Assigned Document, the relevant Grantor
will deliver a copy thereof to the Collateral Agent and will take such other
action as may be necessary or desirable to perfect the lien created by this
Agreement as to such Assigned Document.


 


(f)            Each
Grantor shall, at its expense but subject to Section 2.08(g) hereof, the Credit
Agreement and (in the case of any Assigned Lease) the Service Provider
Agreements:


 


(i)            perform and observe
all the terms and provisions of the Assigned Documents to be performed or observed
by it, enforce the Assigned Documents in accordance with their terms and take
all such action to such end as may be from time to time reasonably requested by
the Collateral Agent or the Administrative Agent; and


 


(ii)           from time to time, (A)
furnish to the Collateral Agent and the Administrative Agent such information
and reports regarding the Collateral as the Collateral Agent and/or the
Administrative Agent may reasonably request and (B) upon request of the
Collateral Agent and/or the Administrative Agent, make to each other party to
any Assigned Document such demands and requests for information and reports or
for action as such Grantor is entitled to make thereunder.


 


(g)           So
long as no Event of Default shall have occurred and be continuing and the
Facility Termination Date has not occurred or been declared, and
notwithstanding any provision to the contrary in this Agreement, each Grantor
shall be entitled, to the exclusion of the Collateral Agent but subject always
to the terms of the Credit Agreement (x) to exercise and receive, directly or
indirectly through one or more agents, including a Service Provider, any of the
claims, rights, powers, privileges, remedies and other benefits under, pursuant
to, with respect to or arising out of the Assigned Documents and (y) to take
any action or to not take any action, directly or indirectly through one or
more agents, including a Service Provider, related to the Assigned Documents
and the lessees or counterparties thereunder, including entering into, amending,
supplementing, terminating, performing, enforcing, compelling performance of,
exercising all remedies (whether arising under any Assigned Document or by
statute or at law or in equity or otherwise) under, exercising rights,
elections or options or taking any other action under or in respect of,
granting or withholding notices, waivers, approvals and consents in respect of,
receiving all payments under, dealing with any credit support or collateral
security in respect of, or taking any other action in respect of, the Assigned
Documents and contacting or otherwise having any dealings with any lessee or
counterparty thereunder; provided, however, (i) whether or not an Event of
Default has occurred and/or is continuing or the Facility Termination Date has occurred
or been declared, all amounts payable under each Assigned Document (including
all Rental Payments under each Assigned Lease) shall be paid directly to the
appropriate Bank Account or Non-Trustee Account in accordance with the terms
hereof and of the Credit Agreement, (ii) so long as any Assigned Lease remains
in effect (and without limiting the authority of the Service Providers under
the express terms of the Service Provider


 


18

















 


Agreements),
no Grantor will abrogate any right, power or privilege granted expressly in
favor of the Collateral Agent, the Administrative Agent or a Secured Party
under any Lease Assignment Document and (iii) upon or after the occurrence of
an Event of Default which is continuing or the occurrence or declaration of the
Facility Termination Date under the terms of the Credit Agreement and delivery
of a written direction to the Borrower from the Administrative Agent, all such
rights of each Grantor shall cease, and all such rights shall become vested in
the Collateral Agent and the Administrative Agent, which shall thereupon have
the sole right to exercise or refrain from exercising such rights. Neither the
Account Bank nor the Collateral Agent shall have any obligation to verify whether
an Event of Default has occurred and is continuing, but shall be entitled to
rely, and protected in relying on the Administrative Agent’s notice thereof
notwithstanding any contrary instructions of any Grantor.


 


Section
2.09  Covenants Regarding Security
Collateral, Beneficial Interest Collateral, Membership Interest Collateral and
Investment Collateral. (a)  All
Security Collateral, Beneficial Interest Collateral, Membership Interest
Collateral and Investment Collateral (the “Relevant Collateral”) shall be
delivered to the Collateral Agent as follows:


 


(i)            in the case of each
Certificated Security or Instrument, by causing the delivery of such
Certificated Security or Instrument to the Collateral Agent in the State of New
York, registered in the name of the Collateral Agent or duly endorsed by an
appropriate person to the Collateral Agent or in blank and, in each case, to be
held by the Collateral Agent in the State of New York;


 


(ii)           in the case of each
Uncertificated Security, by (A) causing such Uncertificated Security to be
continuously registered on the books of the issuer thereof in the name of the
Collateral Agent or (B) if such Uncertificated Security is registered in the
name of a Securities Intermediary on the books of the issuer thereof or on the
books of any securities intermediary of a Securities Intermediary, by causing
such Securities Intermediary to continuously credit by book entry such
Uncertificated Security to a Securities Account maintained by such Securities
Intermediary in the name of the Collateral Agent and confirming to the
Collateral Agent that it has been so credited;


 


(iii)          in the case of each
Government Security registered in the name of any Securities Intermediary on
the books of any applicable Federal Reserve Bank Branch) or on the books of any
securities intermediary of such Securities Intermediary, by causing such
Securities Intermediary to continuously credit by book entry such security to
the Securities Account maintained by such Securities Intermediary in the name of
the Collateral Agent and confirming to the Collateral Agent and the
Administrative Agent that it has been so credited; and


 


(iv)          in the case of any
Beneficial Interest Collateral or Membership Interest Collateral by (A) to the
extent that the grant of the security interest to the Collateral Agent in any
Beneficial Interest Collateral or Membership Interest Collateral or the
transfer of any Beneficial Interest Collateral or Membership Interest
Collateral upon exercise of remedies by the Collateral Agent is subject to any
restrictions on transfer or any consent requirements, by obtaining all


 


19

















 


necessary
consents and approvals thereof and (B) complying with clause (i) or clause (ii)
above, as applicable.


 


(b)           Each Borrower Group
Member and the Collateral Agent hereby represents, with respect to the Relevant
Collateral, that it has not entered into, and hereby agrees that it will not
enter into, any agreement (i) with any of the other parties hereto or any Securities
Intermediary specifying any jurisdiction other than the State of New York as
any Securities Intermediary’s jurisdiction in connection with any Securities
Account with any Securities Intermediary referred to in Section 2.09(a) for
purposes of 31 C.F.R. Section 357.11(b), Section 8-110(e) of the UCC or any
similar state or Federal law, or (ii) with any other person relating to such
account pursuant to which it has agreed that any Securities Intermediary may
comply with entitlement orders made by such person. The Collateral Agent
represents that it will, by express agreement with each Securities
Intermediary, provide for each item of property constituting Relevant
Collateral held in and credited to the applicable Securities Account, including
cash, to be treated as a “financial asset” within the meaning of Section
8-102(a)(9) of the UCC for the purposes of Article 8 of the UCC.


 


(c)           Without limiting the
foregoing, each Borrower Group Member and the Collateral Agent agree, and the
Collateral Agent shall cause each Securities Intermediary to take such
different or additional action as may be required based upon any Opinion of
Counsel received pursuant to Section 2.19 or any request of the Administrative
Agent, in order to maintain the perfection and priority of the security
interest of the Collateral Agent in the Relevant Collateral in the event of any
change in applicable law or regulation, including Articles 8 and 9 of the UCC
and regulations of the U.S. Department of the Treasury governing transfers of
interests in Government Securities.


 


Section
2.10  Covenants Regarding
Commercial Tort Claims. If any Grantor shall at any time acquire a
Commercial Tort Claim, such Grantor shall immediately notify the Collateral
Agent and the Administrative Agent in writing signed by such Grantor of the
details thereof (including specific case captions or description per Official
Comment 5 to Section 9-108 of the UCC) and grant to the Collateral Agent in
such writing a security interest therein and in the proceeds thereof, all upon
the terms of this Agreement, with such writing to be in form and substance
reasonably satisfactory to the Administrative Agent.


 


Section
2.11  Further Assurances. (a)  Each Grantor agrees that, from time to time,
at the expense of such Grantor, such Grantor shall promptly execute and deliver
all further instruments and documents, and take all further action (including
under the laws of any foreign jurisdiction), that may be necessary, or that the
Collateral Agent or Administrative Agent may reasonably request, in order to
perfect and protect any pledge, assignment or security interest granted or
purported to be granted hereby or to enable the Collateral Agent to exercise
and enforce its rights and remedies hereunder with respect to any Collateral. Without
limiting the generality of the foregoing, each Grantor shall:  (i) if any Collateral shall be evidenced by a
promissory note or other instrument or “tangible chattel paper” (as defined in
Section 9-102(a)(78) of the UCC), deliver and pledge to the Collateral Agent
hereunder such note or instrument or tangible chattel paper, each such note or
instrument to be duly endorsed and accompanied by duly executed instruments of
transfer or assignment in blank; (ii) execute and file such financing or
continuation statements, or amendments thereto, and such other


 


20

















 


instruments or
notices, as may be necessary or desirable, or as the Collateral Agent or
Administrative Agent may reasonably request, in order to perfect and preserve
the pledge, assignment and security interest granted or purported to be granted
hereby and (iii) execute, file, record, or register such additional documents
and supplements to this Agreement, including any further assignments, security
agreements, pledges, grants and transfers, as may be required by or desirable
under the laws of any foreign jurisdiction, or as the Collateral Agent or
Administrative Agent may reasonably request, to create, attach, perfect,
validate, render enforceable, protect or establish the priority of the security
interest and lien created by this Agreement.


 


(b)           Each
Grantor hereby authorizes the Collateral Agent to file one or more financing or
continuation statements, and amendments thereto, relating to all or any part of
the Collateral without the signature of such Grantor where permitted by law. 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.


 


(c)           Each
Grantor shall furnish or cause to be furnished to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the Collateral
Agent or Administrative Agent may reasonably request, all in reasonable detail;
provided that, to the extent that (in the case of any Assigned Lease) such
statements, schedules or reports (or the data needed to prepare them) can be
obtained only from a Service Provider, no Grantor shall be required to obtain
any such statements, schedules, reports or data beyond those to which it is
entitled under the Service Provider Agreements.


 


(d)           Each
Grantor shall, immediately upon the organization or acquisition by such Grantor
of any Borrower Subsidiary, cause such Borrower Subsidiary to enter into a
Grantor Supplement. Such Grantor shall promptly take such actions as are
necessary to perfect the security interest granted under such Grantor
Supplement including without limitation, if such Borrower Subsidiary is
organized under the law of Ireland, or has a place of business or assets
(including without limitation shares in a company organized under the law of
Ireland) located in Ireland, by causing such Grantor Supplement to be duly
recorded with the Irish Registrar of Companies and the Irish Revenue
Commissioners within 21 days after the execution of such Grantor Supplement, or
such lesser period as may be applicable under Requirements of Law.


 


Section
2.12  Place of Perfection;
Records. Each Grantor shall keep its jurisdiction of organization, chief
place of business and chief executive office and the office where it keeps its
records concerning the Collateral at the location specified in Schedule IV
or, upon 30 days’ prior written notice to the Collateral Agent and
Administrative Agent, at such other locations in a jurisdiction where all
actions required by Section 10.2(a) of the Credit Agreement shall have been
taken with respect to the Collateral. Each Grantor shall hold and preserve such
records and shall permit representatives of the Collateral Agent and/or
Administrative Agent at any time during normal business hours to inspect and
make abstracts or copies from such records, all at the sole cost and expense of
such Grantor.


 


Section
2.13  Voting Rights; Dividends;
Etc. (a)  So long as no Event of
Default shall have occurred and be continuing and the Facility Termination Date
has not occurred or been declared under the terms of the Credit Agreement:


 


21

















 


(i)            Each of the Grantors
shall be entitled to exercise any and all voting and other consensual rights
pertaining to all or any part of the Security Collateral, Membership Interest
Collateral and Beneficial Interest Collateral pledged by such Grantor for any
purpose not inconsistent with the terms of this Agreement, the charter
documents of such Grantor or the Credit Agreement; provided, however, that such
Grantor shall not exercise or shall refrain from exercising any such right if
in its judgment such action would have a material adverse effect on the value
of all or any part of the Security Collateral, Membership Interest Collateral
or the Beneficial Interest Collateral; and


 


(ii)           The Collateral Agent
shall execute and deliver (or cause to be executed and delivered) to such
Grantor all such proxies and other instruments as such Grantor may reasonably
request in writing and provide for the purpose of enabling such Grantor to
exercise the voting and other rights that it is entitled to exercise pursuant
to Section 2.13(a)(i).


 


(b)           Whether
or not any Event of Default shall have occurred and be continuing and whether
or not the Facility Termination Date has occurred or been declared under the
terms of the Credit Agreement, any and all distributions, dividends and
interest paid in respect of the Security Collateral, Membership Interest
Collateral and Beneficial Interest Collateral pledged by such Grantor,
including any and all (i) distributions, dividends and interest 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, such
Security Collateral, Membership Interest Collateral or Beneficial Interest
Collateral; (ii) distributions, dividends and other distributions paid or
payable in cash in respect of such Security Collateral, Membership Interest
Collateral or Beneficial Interest Collateral in connection with a partial or
total liquidation or dissolution or in connection with a reduction of capital,
capital surplus or paid-in surplus; and (iii) cash paid, payable or otherwise
distributed in respect of principal of, or in redemption of, or in exchange
for, such Security Collateral, Membership Interest Collateral or Beneficial
Interest Collateral shall be paid into the Collection Account and, if received
by such Grantor, shall be received in trust for the benefit of the Secured
Parties, be segregated from the other property or funds of such Grantor and be
forthwith paid to the Collection Account in the same form as so received (with
any necessary endorsement).


 


(c)           Upon
the occurrence of an Event of Default which is continuing or if the Facility
Termination Date has occurred or been declared, all rights of each Grantor to
exercise or refrain from exercising the voting and other consensual rights that
it would otherwise be entitled to exercise pursuant to Section 2.13(a)(i) and
2.13(a)(ii) shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, who, subject to Section 5.04(d), shall thereupon have the
sole right to exercise or refrain from exercising such voting and other
consensual rights (including, but not limited to, the right, subject to the
restrictions set forth in the applicable organizational documents, to remove or
appoint any trustee, directors and officers of any direct or indirect
subsidiary of the Borrower), provided, however, that the Collateral Agent shall
exercise such voting or consensual right only upon receipt of instruction from
the Administrative Agent.


 


22

















 


Section
2.14  Transfers and Other
Encumbrances; Additional Shares or Interests. (a) No Grantor shall (i)
sell, assign (by operation of law or otherwise) or otherwise dispose of, or
grant any option with respect to, any of the Collateral or (ii) create or
suffer to exist any Lien (other than Permitted Liens) upon or with respect to
any of the Collateral of such Grantor, other than the pledge, assignment, lien
and security interest created by this Agreement and as otherwise provided
herein or in the Credit Agreement.


 


(b)           Except
to the extent permitted by the Credit Agreement, the Borrower Subsidiaries
shall not, and the Borrower shall not permit the Borrower Subsidiaries to,
issue, substitute, deliver or sell any shares, interests, participations or
other equivalents in any Borrower Subsidiary. Any beneficial interest or
capital stock or other securities or interests issued in respect of, or in
substitution for, the Pledged Stock, Pledged Membership Interest or the Pledged
Beneficial Interest shall be issued or delivered (with any necessary
endorsement) to the Collateral Agent.


 


(c)           All
distributions, dividends and interest payments that are received by such
Grantor contrary to the provisions of this Agreement shall be received in trust
for the benefit of the Secured Parties, shall be segregated from other funds of
such Grantor and shall be forthwith paid over to the Collateral Agent as
Security Collateral or Beneficial Interest Collateral as the case may be, in
the same form as so received (with any necessary endorsement).


 


Section
2.15  Collateral Agent
Appointed Attorney-in-Fact. Each Grantor hereby irrevocably appoints the
Collateral Agent such Grantor’s attorney-in-fact (in the case of any Grantor
incorporated in Ireland such appointment shall be by way of security), with
full authority in the place and stead of such Grantor and in the name of such
Grantor or otherwise, from time to time in the Collateral Agent’s discretion,
upon advice and instruction of the Administrative Agent (except for item (d)
below, upon the occurrence of an Event of Default which is continuing or if the
Facility Termination Date has occurred or been declared), to take any action
and to execute any instrument that the Administrative Agent may deem necessary
or advisable for the Collateral Agent to take to accomplish the purposes of
this Agreement or to take any action and to execute any instrument as directed
by the Administrative Agent in accordance with the terms of this Agreement and
the Credit Agreement, including, but not limited to:


 


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


 


(b)           to
receive, endorse and collect any Accounts Receivable, drafts or other
instruments and documents in connection included in the Collateral;


 


(c)           to
file any claims or take any action or institute any proceedings that the
Collateral Agent may deem necessary or desirable for the collection of any of
the Collateral or otherwise to enforce the rights of the Collateral Agent with
respect to any of the Collateral;


 


(d)           to
execute and file any financing or continuation statements, or amendments
thereto, and such other instruments or notices, as may be necessary or
desirable, including as identified to the Collateral Agent pursuant to the
Opinion of Counsel described in


 


23

















 


Section 2.19
hereof in order to perfect and preserve the pledge, assignment and security
interest granted hereby; provided that the Collateral Agent’s exercise of any
such power shall be subject to Section 2.08(d); and


 


(e)           upon
prior notice to the Borrower on behalf of the Grantors, notify account debtors
that the Accounts Receivable and the right, title and interest of any Grantor
in and under such Accounts Receivable have been assigned to Collateral Agent,
and that payments thereunder shall be made directly to the Collateral Agent,
for the benefit of the Secured Parties.


 


Section
2.16  Collateral Agent May
Perform. If any Grantor fails to perform any agreement contained in this
Agreement, the Administrative Agent or the Collateral Agent (at the direction
of the Administrative Agent) may (but shall not be obligated to) itself
perform, or cause performance of, such agreement, and the expenses of the
Collateral Agent or the Administrative Agent incurred in connection with doing
so shall be payable by the Grantors.


 


Section
2.17  Covenant to Pay. Each
Grantor covenants with the Collateral Agent (for the benefit of the Collateral
Agent and the Secured Parties) that it will pay or discharge any monies and
liabilities whatsoever that are now, or at any time hereafter may be, due, owing
or payable by such Grantor in any currency, actually or contingently, solely
and/or jointly, and/or severally with another or others, as principal or surety
on any account whatsoever pursuant to the Service Provider Documents, the
Credit Agreement, and the Hedge Agreements in accordance with their terms.


 


Section
2.18  Delivery of Collateral
Supplements. Upon the acquisition by any Grantor of any Relevant Collateral
or establishment of a Non-Trustee Account, the relevant Grantor shall
concurrently execute and deliver to the Collateral Agent a Collateral
Supplement duly completed with respect to such Collateral and shall take such
steps with respect to the perfection of such Collateral as are called for in
this section and otherwise in this Agreement for Collateral of the same type;
provided that the foregoing shall not be construed to impair or otherwise
derogate from any restriction on any such action in any Transaction Document
and provided, further that the failure of any Grantor to deliver any Collateral
Supplement as to any such Collateral shall not impair the lien of this
Agreement as to such Collateral. If such Grantor is organized under the law of
Ireland, or has a place of business or assets (including without limitation
shares in a company organized under the law of Ireland) located in Ireland, the
relevant Grantor shall cause such Grantor Supplement to be duly recorded with
the Irish Registrar of Companies and the Irish Revenue Commissioners within 21
days after the execution of such Grantor Supplement, or such lesser period as
may be applicable under Requirements of Law. Without limitation of the
requirements of the immediately preceding sentence, if such Grantor is the
Borrower or any other Borrower Group Member organized under the law of Bermuda,
such Grantor shall cause such Grantor Supplement to be duly recorded with the
appropriate register of Bermuda.


 


Section
2.19  Annual Opinion. Upon
each anniversary of the Closing Date, the Borrower shall cause to be delivered
to the Collateral Agent and the Administrative Agent an Opinion of Counsel in
each Annual Opinion Jurisdiction to the effect that (i) during the preceding
year there has not occurred any change of the law of such jurisdiction that
would require the taking of any action in order to maintain the perfection or
priority of the lien of this Agreement on the Collateral or, if there has been
such a change, setting forth the actions so to be


 


24

















 


taken and (ii)
no additional financing statement, continuation statement or amendment thereof,
or other document or instrument, is required to be filed, and no other action
is required to be taken, under the law in existence on the date of such
opinion, during the next twelve months to maintain the perfected security
interest of the Collateral Agent in any part of the Collateral granted
hereunder or under any other Transaction Document, or identifying any such
required financing statement, continuation statement, amendment, instrument,
document or other action. The Borrower agrees to take all such actions as may
be indicated in any such opinion, except that, as provided in Section 2.09, the
Collateral Agent shall take any such actions as may be required with respect to
any Securities Intermediary.


 


Section
2.20  Covenants Regarding
Control. No Grantor shall cause or permit any Person other than the
Collateral Agent to have “control” as defined in Section 9-104, 9-105, 9-106,
or 9-107 of the UCC (“Control”) of any Supporting Obligations or Letter of
Credit Rights, or any “deposit account,” “securities account,” “electronic
chattel paper” or “investment property” (as such terms are defined in Article 9
or Article 8 of the UCC as applicable), in each case, included in the
Collateral or any Bank Account or Non-Trustee Account.


 


Section
2.21  Share Mortgage; etc. In
the case of any Borrower Subsidiary that is incorporated under the law of
Ireland, the Borrower shall, and shall cause each other Borrower Group Member
(as applicable) to, enter into an Irish Share Mortgage in respect of the issued
share capital (if any) held by it in such Borrower Subsidiary. Such Irish Share
Mortgage shall be entered into at the time contemplated by the terms of Section
2.11(d). The Borrower shall cause such Irish Share Mortgage to be filed with
the Irish Registrar of Companies and the Irish Revenue Commissioners within 21
days following the execution and delivery by such Grantor of such Irish Share
Mortgage, or such lesser period as may be applicable under Requirements of Law,
and shall take any other actions as may be required or as the Administrative
Agent or the Collateral Agent (at the direction of the Administrative Agent)
may reasonably request, in order to cause such Irish Share Mortgage to
constitute a perfected and (to the extent recognized under Applicable Law)
first-priority security interest in the share capital covered thereby. In the
case of any Borrower Subsidiary that is not incorporated under the law of
Ireland, the Borrower shall, and shall cause each other Borrower Group Member
(as applicable) to, enter into an appropriate share mortgage, beneficial
interest security agreement, or other security agreement or instrument as may
be reasonably requested by the Administrative Agent or Collateral Agent (at the
direction of the Administrative Agent), in respect of the issued share capital
or other ownership or beneficial interest held by it in such Borrower
Subsidiary. Such share mortgage or other agreement or instrument shall be
entered into at the time contemplated by the terms of Section 2.11(d). The
Borrower shall cause such share mortgage or other agreement or instrument to be
filed with any appropriate register and shall take such other actions as may be
necessary or as the Administrative Agent or the Collateral Agent (at the
direction of the Administrative Agent) may reasonably request in order to cause
such mortgage, agreement or instrument to constitute a first-priority security
interest in the share capital or other ownership or beneficial interest covered
thereby.


 


Section
2.22  Subordination of
Intercompany Obligations. The Borrower agrees that all Intercompany
Obligations shall be subject and subordinate and junior in right of payment and
performance to all obligations of the Borrower Subsidiaries to the Collateral
Agent and Administrative Agent hereunder and to the security interests in the
Collateral granted to the


 


25

















 


Collateral
Agent for the benefit of the Secured Parties to secure the payment and
performance of the Secured Obligations. Upon the occurrence and during the
continuance of an Event of Default or if the Facility Termination Date has
occurred or been declared under the terms of the Credit Agreement, then unless
and until all Secured Obligations shall have been paid and performed in full,
(x) no payment on account of the principal of, or interest on, or any other
amount in respect of, the Intercompany Obligations or any judgment with respect
thereto shall be made by or on behalf of any Borrower Subsidiary to the
Borrower and (y) the Borrower shall not (A) ask, demand, sue for, take or
receive from any Borrower Subsidiary, by set-off or in any other manner any
payment on account of the principal of, or interest on, or any other amount in
respect of, the Intercompany Obligations or (B) seek any other remedy allowed
at law or in equity against any Borrower Subsidiary for a breach of
Intercompany Obligations. If any payment or distribution of any character,
whether in cash, securities or other property, in respect of Intercompany
Obligations shall be received by the Borrower in violation of the terms of this
section, such payment or distribution shall be held in trust for the benefit
of, and shall be paid over or delivered to, the Administrative Agent for the benefit
of the Secured Parties to the extent necessary to pay all Secured Obligations
in full.


 


ARTICLE III

REMEDIES


 


Section
3.01  Remedies. Upon the
occurrence of an Event of Default which is continuing or if the Facility
Termination Date has occurred or been declared:


 


(a)           The
Collateral Agent shall, at the direction of the Administrative Agent (which, in
turn, shall have received direction from the Class A Majority Lenders),
exercise in respect of the Collateral, in addition to other rights and remedies
provided for herein, 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 (i) require any Grantor to, and such Grantor hereby agrees that
it shall at its expense and upon request of the Collateral Agent forthwith,
assemble all or part of the Collateral as directed by the Collateral Agent and
make it available to the Collateral Agent at a place to be designated by the
Collateral Agent that is reasonably convenient to both parties and (ii) without
notice except as specified below, sell or cause the sale of the Collateral or
any part thereof in one or more parcels at public or, with notice to the Class
B Lenders and Class C Lenders, private sale, at any of the Collateral Agent’s offices
or elsewhere, for cash, on credit or for future delivery, and upon such other
terms as the Collateral Agent (upon advice and instruction from the
Administrative Agent) may deem commercially reasonable. Each Grantor agrees
that, to the extent notice of sale shall be required by law, at least ten days’
notice to such Grantor 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 Collateral Agent (upon advice and instruction from the
Administrative Agent) shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. The Collateral 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. Notwithstanding any
provision in this Agreement to the contrary, any aforementioned sale of
Collateral (i) shall be subject to the provisions of Section 13.3(c) of the
Credit Agreement and (ii) shall not be subject to the restrictions described in
Section 10.8 of the Credit Agreement.


 


26

















 


(b)           Subject
to the provisions hereof, any Secured Party shall be allowed to bid on any such
foreclosure sale in debt (together with payment in cash, if necessary).


 


(c)           All
cash proceeds received by the Collateral Agent in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral
shall be deposited into the Collection Account for distribution pursuant to
Section 8.1(e)(ii) of the Credit Agreement. Any surplus of such cash or cash
proceeds held by the Collateral Agent and remaining after payment in full of
all the Obligations (as defined in the Credit Agreement) shall be paid over to
the relevant Grantors or whomsoever may be lawfully entitled to receive such
surplus. Any amount received for any sale or sales conducted in accordance with
the terms of this Section 3.01 shall be deemed conclusive and binding on the
Borrower, each Grantor and the Secured Parties.


 


(d)           Until
the occurrence of an Event of Default which is continuing or if the Facility
Termination Date has occurred or been declared under the terms of the Credit
Agreement, so long as the Service Providers are acting in such capacity with
respect to any Lease pursuant to the provisions of the Service Provider
Agreements, each of the Collateral Agent as assignee of the Grantors and the
Administrative Agent agrees not to take any action constituting Services (as
defined in any Service Provider Agreement) and is otherwise subject to the
terms of the Service Provider Agreements when acting thereunder in place of any
Grantor, except (subject to Section 2.08(g)) to the extent the Borrower would
then be entitled to take such action under the express terms of the Service
Provider Agreements.


 


Section
3.02  Iris Conveyancing Acts.
Notwithstanding anything to the contrary contained in this Agreement and in
addition to and without prejudice to any other rights or power of the
Collateral Agent under this Agreement or under general law in any relevant
jurisdiction, at any time that the Collateral shall become enforceable, the
Collateral Agent shall be entitled to appoint a receiver under this Agreement
or under the Conveyancing and Law of Property Act 1881 (as amended and as the
same may be amended, modified or replaced from time to time, the “1881 Act”)
and such receiver shall have all such powers, rights and authority conferred
under the 1881 Act, this Agreement and otherwise under the laws of Ireland
without any limitation or restriction imposed by the 1881 Act or otherwise
under the laws of Ireland which may be excluded or removed. Sections 17 and 20
of the 1881 Act shall not apply to the Collateral or any receiver appointed
under this Agreement or under the 1881 Act and section 24(b) of the Act shall
not apply to the Collateral or to any receiver appointed under this Agreement.


 


ARTICLE IV


SECURITY INTEREST ABSOLUTE


 


Section
4.01  Security Interest
Absolute. A separate action or actions may be brought and prosecuted
against each Grantor to enforce this Agreement, irrespective of whether any
action is brought against any other Grantor or whether any other Grantor is
joined in any such action or actions. All rights of the Collateral Agent and
the Administrative Agent and the security interest and lien granted under, and
all obligations of each Grantor under, this Agreement shall be absolute and
unconditional, irrespective of:


 


27

















 


(a)           any
lack of validity or enforceability of any Transaction Document, Assigned
Document, the Loan Expenses Apportionment and Guarantee Agreement, or Hedge
Agreement or any other agreement or instrument relating thereto;


 


(b)           any
change in the time, manner or place of payment of, the security for, or in any
other term of, all or any of the Secured Obligations, or any other amendment or
waiver of or any consent to any departure from any Transaction Document,
Assigned Document, or Hedge Agreement or any other agreement or instrument
relating thereto;


 


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


 


(d)           any
manner of application of collateral, or proceeds thereof, to all or any of the
Secured Obligations, or any manner of sale or other disposition of any
collateral for all or any of the Secured Obligations or any other assets of
such Grantor;


 


(e)           any
change, restructuring or termination of the corporate structure, partnership or
trust or existence as applicable of any Grantor; or


 


(f)            any
other circumstance that might otherwise constitute a defense available to, or a
discharge of, any Grantor or a third-party grantor of a security interest or a
Person deemed to be a surety.


 


ARTICLE V

THE COLLATERAL AGENT


 


Section
5.01  Authorization and Action.
(a)  Each Secured Party by its acceptance
of the benefits of this Agreement hereby appoints and authorizes DBTCA as the
initial Collateral Agent to take such action as trustee on behalf of the
Secured Parties and to exercise such powers and discretion under this Agreement
and the other Transaction Documents as are specifically delegated to the
Collateral Agent by the terms of this Agreement and of the Transaction
Documents, and no implied duties and covenants shall be deemed to arise against
the Collateral Agent. Each Grantor and the Administrative Agent acknowledge and
agree that the Collateral Agent shall comply with all written instructions and
directions of the Administrative Agent given in accordance with this Agreement
and the Credit Agreement without further consent of any Grantor and notwithstanding
any contrary instructions or directions of any Grantor.


 


(b)           The
Collateral Agent accepts such appointment and agrees to perform the same but
only upon the terms of this Agreement and the Credit Agreement and agrees to
receive and disburse all moneys received by it in accordance with the terms of
this Agreement and the Credit Agreement. The Collateral Agent in its individual
capacity shall not be answerable or accountable under any circumstances, except
for its own willful misconduct or gross negligence (or simple negligence in the
handling of funds) or breach of any of its representations or warranties set
forth in this Agreement, and the Collateral Agent shall not be liable for any
action or inaction of any Grantor or any other parties to any of the
Transaction Documents.


 


28














 


(c)           The
Collateral Agent shall take all actions permitted hereunder and exercise all
powers granted to it hereunder upon, and at the direction of, the
Administrative Agent. The Collateral Agent shall have a reasonable period in
which to act upon any instruction, direction or notice received hereunder.


 


(d)           The
Collateral Agent agrees to promptly deliver to the Administrative Agent copies
of all items delivered to the Collateral Agent hereunder.


 


(e)           Whenever
the Collateral Agent is required to provide its consent or direction or
otherwise make a determination under this Credit Agreement or any other
Transaction Document, the Collateral Agent shall act only upon the written
instructions of the Administrative Agent. The Collateral Agent may conclusively
rely on such instructions, and shall be entitled to refrain from providing such
consent or direction or making such determination in the absence of such
instructions.


 


Section
5.02 Limitation of Duties. The powers conferred on the
Collateral Agent under this Agreement with respect to the Collateral shall not
impose any duty upon it, except as explicitly set forth herein, 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 under this Agreement, the
Collateral Agent shall have no duty, unless directed by the Administrative
Agent, 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 or perfect
rights against any parties or any other rights pertaining to any Collateral. The
Collateral Agent shall have no duty to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the
part of any Grantor or Lessee. In no event shall the Collateral Agent be liable
for any punitive or special damages nor for any damages arising or caused by an
act of God, war or any other matter beyond the reasonable control of the
Collateral Agent or the Account Bank.


 


Section
5.03 Representations or Warranties. The Collateral Agent
does not make, and shall not be deemed to have made, any representation or
warranty as to the validity, legality or enforceability of this Agreement, any
other Transaction Document or any other document or instrument or as to the
correctness of any statement contained in any thereof, or as to the validity or
sufficiency of any of the pledge and security interests granted hereby, except
that the Collateral Agent in its individual capacity hereby represents and
warrants (a) that each such specified document to which it is a party has been
or will be duly executed and delivered by two of its officers who is and will
be duly authorized to execute and deliver such document on its behalf, and (b)
this Agreement is the legal, valid and binding obligation of DBTCA, enforceable
against DBTCA in accordance with its terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar law
affecting creditors’ rights generally.


 


Section
5.04 Reliance; Agents; Advice of Counsel. (a)  The Collateral Agent shall incur no liability
to anyone as a result of acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or
other document believed by it to be genuine and believed by it to be signed by
the proper party or parties. The Collateral Agent may accept a copy of a
resolution of the board or other governing body of any party to this


 


29

















 


Agreement or
any other Transaction Document, certified by the Secretary or an Assistant Secretary
thereof or other duly authorized Person of such party as duly adopted and in
full force and effect, as conclusive evidence that such resolution has been
duly adopted by said board or other governing body and that the same is in full
force and effect. As to any fact or matter the manner of ascertainment of which
is not specifically described in this Agreement, the Collateral Agent shall be
entitled to receive and may for all purposes hereof conclusively rely on a
certificate, signed by an officer of any Person, as to such fact or matter, and
such certificate shall constitute full protection to the Collateral Agent for
any action taken or omitted to be taken by it in good faith in reliance thereon.
The Collateral Agent shall furnish to each Service Provider upon request such
information and copies of such documents as the Collateral Agent may have and
as are necessary for such Service Provider to perform its duties under the
applicable Transaction Documents. The Collateral Agent shall assume, and shall
be fully protected in assuming, that each other party to this Agreement is
authorized by its constitutional documents to enter into this Agreement and to
take all action permitted to be taken by it pursuant to the provisions of this
Agreement, and shall not inquire into the authorization of such party with
respect thereto.


 


(b)           The
Collateral Agent may execute any of the powers hereunder or perform any duties
under this Agreement either directly or by or through agents, or attorneys or a
custodian or nominee, provided that the Collateral Agent shall be responsible
for any actions or inactions of any such agent, attorney, custodian or nominee.


 


(c)           The
Collateral Agent may consult with counsel, and any opinion of counsel or any
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken or suffered or omitted by it under this
Agreement in good faith and in accordance with such advice or opinion of
counsel.


 


(d)           The
Collateral Agent shall be under no obligation to exercise any of the rights or
powers vested in it by this Agreement, or to institute, conduct or defend any
litigation under this Agreement or in relation hereto, at the request, order or
direction of any of the Secured Parties, pursuant to the provisions of this
Agreement, unless the Collateral Agent shall have received written advice,
instruction or direction from the Administrative Agent with respect to such
matter, and if the funds provided in accordance with Section 8.1(e) of the
Credit Agreement are not available to pay for the costs and expenses incurred
by the Collateral Agent, such Secured Party shall have offered to the
Collateral Agent reasonable security or indemnity satisfactory to it against
the costs, expenses and liabilities which may be incurred therein or thereby.


 


(e)           The
Collateral Agent shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if the funds
provided in accordance with Section 8.1(e) of the Credit Agreement are not
available to pay for the costs and expenses incurred by the Collateral Agent
and none of the provisions contained in this Agreement shall in any event
require the Collateral Agent to perform, or be responsible or liable for the
manner of performance of, any obligations of the Borrower or any Service
Provider under any of the Transaction Documents.


 


30

















 


(f)            Reserved.


 


(g)           When
the Collateral Agent incurs expenses or renders services in connection with an
exercise of remedies specified in Section 3.01, such expenses (including the
fees and expenses of its counsel) and the compensation for such services is
intended to constitute expenses of administration under any bankruptcy law or
law relating to creditors’ rights generally.


 


(h)           The
Collateral Agent shall not be charged with knowledge of an Event of Default
unless a Responsible Officer of the Collateral Agent obtains actual knowledge
of such event or the Collateral Agent receives written notice of such event
from any of the Secured Parties or the Administrative Agent.


 


(i)            The
Collateral Agent shall have no duty to monitor the effectiveness or perfection
of any security interest in any Collateral or the performance of the Borrower,
any Service Provider or any other party to the Transaction Documents, nor shall
it have any liability in connection with the appointment of any Service
Provider, or the malfeasance or nonfeasance by such parties. The Collateral
Agent shall have no liability in connection with non-compliance by the
Borrower, any Service Provider or any lessee under a Lease with statutory or
regulatory requirements related to the Collateral, any Aircraft or any Lease. The
Collateral Agent shall not make or be deemed to have made any representations
or warranties with respect to the Collateral, any Aircraft or any Lease or the
validity or sufficiency of any assignment or other disposition of the
Collateral, any Aircraft, or any Lease.


 


Section
5.05 No Individual Liability. The Collateral Agent shall
have no individual liability in respect of all or any part of the Secured
Obligations, and all shall look, subject to the Lien and priorities of payment
provided in the Credit Agreement, only to the property of the Grantors for
payment or satisfaction of the Secured Obligations.


 


ARTICLE VI


SUCCESSOR COLLATERAL AGENTS


 


Section
6.01 Resignation and Removal of Collateral Agent. The
Collateral Agent may resign at any time without cause by giving at least 30
days’ prior written notice to the Borrower and the Administrative Agent. The
Administrative Agent may at any time remove the Collateral Agent without cause
by an instrument in writing delivered to the Secured Parties, the Borrower and
the Collateral Agent. No resignation or removal of the Collateral Agent
pursuant to this Section 6.01 shall become effective prior to the date of
appointment by the Administrative Agent of a successor Collateral Agent and the
acceptance of such appointment by such successor Collateral Agent.


 


Section
6.02 Appointment of Successor. (a)  In the case of the resignation or removal of
the Collateral Agent, the Administrative Agent, on behalf of the Secured
Parties, shall promptly appoint a successor Collateral Agent; provided, that,
prior to the occurrence of an Event of Default which is continuing or the
occurrence or declaration of the Facility Termination Date, such successor
shall be reasonably acceptable to the Borrower. If a successor Collateral Agent
shall not have been appointed and accepted its appointment hereunder within
such 30 day


 


31

















 


period after
the Collateral Agent gives notice of resignation as to such class or subclass,
the retiring Collateral Agent or the Secured Parties (or Administrative Agent
on behalf of the Secured Parties) may petition any court of competent
jurisdiction for the appointment of a successor Collateral Agent. Any successor
Collateral Agent so appointed by such court shall immediately and without
further act be superseded by any successor Collateral Agent appointed as
provided in the first sentence of this paragraph within one year from the date
of the appointment by such court.


 


(b)           Any
successor Collateral Agent shall execute and deliver to the Secured Parties an
instrument accepting such appointment. Upon the acceptance of any appointment
as Collateral Agent hereunder, a successor Collateral Agent, upon the execution
and filing or recording of such financing statements, or amendments thereto,
and such amendments or supplements to this Agreement, and such other
instruments or notices, as may be necessary or desirable, or as the
Administrative Agent may request, in order to continue the perfection (if any)
of the liens granted or purported to be granted hereby, shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of
the retiring Collateral Agent, and the retiring Collateral Agent shall be
discharged from its duties and obligations under this Agreement and the other
Transaction Documents. The retiring Collateral Agent shall take all steps
necessary to transfer all Collateral in its possession and all its control over
the Collateral to the successor Collateral Agent. After any retiring Collateral
Agent’s resignation or removal hereunder as to any actions taken or omitted to
be taken by it while it was Collateral Agent, the provisions of all of Article
VII shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Collateral Agent under this Agreement.


 


(c)           Each
Collateral Agent shall be an Eligible Institution acceptable to the Secured
Parties.


 


(d)           Any
corporation into which the Collateral Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Collateral Agent shall be a party, or
any corporation to which substantially all the business of the Collateral Agent
may be transferred, shall be the Collateral Agent under this Agreement without
further act.


 


(e)           Following
the resignation or removal of the Collateral Agent, and the appointment and
acceptance of such appointment by a successor Collateral Agent, all references
to “Illinois” in Sections 2.05 and 2.09 herein shall be deemed to refer to the
state in which the Collateral Agent is physically located.


 


ARTICLE VII

EXPENSES


 


Section
7.01 In General. The Borrower shall, upon demand and
pursuant to Section 8.01(e) of the Credit Agreement, pay to the Collateral
Agent and the Account Bank the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts
and agents, that each such party may incur in connection with (i) the
administration of this Agreement, (ii) the custody, preservation, use or
operation of, or the sale of, collection from or other realization upon, any of
the Collateral, (iii) the exercise or


 


32

















 


enforcement of
any of the rights of the Collateral Agent, the Account Bank or any other
Secured Party against any Grantor hereunder, or (iv) the failure by any Grantor
to perform or observe any of the provisions hereof.


 


Section
7.02 Reserved.


 


Section
7.03 No Compensation from Secured Parties. The Collateral
Agent and the Account Bank each agree that it shall have no right against the
Secured Parties for any fee as compensation for its services in such capacity.


 


Section
7.04 Collateral Agent and Account Bank Fees. In
consideration of the Collateral Agent’s and the Account Bank’s performance of
the services provided for under this Agreement, the Borrower shall pay to the
Collateral Agent and the Account Bank, a fee, payable monthly on each Payment
Date together with all expenses and charges as set forth under a separate
agreement among the Borrower, the Collateral Agent and the Account Bank.


 


ARTICLE VIII

MISCELLANEOUS


 


Section
8.01 Amendments; Waivers; Etc. (a)  No amendment or waiver of any provision of
this Agreement, and no consent to any departure by any party from the
provisions of this Agreement, shall in any event be effective unless the same
shall be in writing and signed by the parties hereto, and then such waiver or
consent shall be effective only in the specific instance and for the specific purpose
for which given. In executing and delivering any amendment or modification to
this Agreement, unless the terms of Section 5.04(d) shall have been satisfied
with respect to such amendment or modification, the Collateral Agent shall be
entitled to (i) an Opnion ofCounsel delivered by counsel satisfactory to the
Collatiral Age t stating that such amendment is authorized and permitted
pursuant to the Credit Agreement and this Agreement and complies with the terms
thereof and hereof or (ii) an Officer’s Certificate of the Borrower stating
that such amendment is authorized and permitted pursuant to the Credit
Agreement and all conditions precedent to the execution, delivery and
performance of such amendment have been satisfied in full. The Collateral Agent
may, but shall have no obligation to, execute and deliver any amendment or
modification which would affect its duties, powers, rights, immunities or
indemnities hereunder.


 


(b)           Upon
the execution and delivery by any Person of a Grantor Supplement, (i) such
Person shall be referred to as an “Additional Grantor” and shall be and become
a Grantor hereunder, and each reference in this Agreement to “Grantor” shall
also mean and be a reference to such Additional Grantor, (ii) Annexes I, III
and IV attached to each Grantor Supplement shall be incorporated into, become a
part of and supplement Schedules I, III and IV,
respectively, and the Collateral Agent may attach such Annexes as supplements
to such Schedules; and each reference to such Schedules shall be a reference to
such Schedules as so supplemented and (iii) such Additional Grantor shall be a
Grantor for all purposes under this Agreement and shall be bound by the
obligations of the Grantors hereunder.


 


(c)           Upon
the execution and delivery by a Grantor of a Collateral Supplement, Annex I to
each Collateral Supplement shall be incorporated into, become a part of and


 


33

















 


supplement Schedule
I, and the Collateral Agent may attach such Annex as supplements to such Schedule;
and each reference to such Schedule shall be a reference to such Schedule as so
supplemented.


 


Section
8.02 Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including
telecopier) and mailed, telecopied or delivered to the intended recipient at
its address specified, as follows:


 


If to Borrower
or any other Borrower Group Member:


 


AerFunding 1
Limited


Clarendon
House

2 Church Street

Hamilton, HM 11

Bermuda

Attention:  Company Secretary

Fax:  +1 (441) 295-1861


 


With a copy
to:


 


AerCap
Administrative Services Limited

AerCap House

Shannon

Ireland

Attention:  Company Secretary

Fax:  +353- 61-723850


 


For the
Collateral Agent and the Account Bank:


 


Deutsche Bank
Trust Company Americas

60 Wall Street, 26th Floor

New York, NY  10005


Attention:  Trust and Securities Services/Structured
Finance Services

Fax:  +1 (906) 608-3215


 


For the
Administrative Agent:


 


1285 Avenue of
the Americas - 11th Floor

New York, NY 10019

Attention:  Prakash Wadhwani

Fax: No.: +1 (212) 713-7999


 


With a copy
to:


 


1285 Avenue of
the Americas - 11th Floor

New York, NY 10019

Attention:  Kathy Pringle


 


34

















 


Fax: +1 (212)
713-7999


 


With a further
copy to:


 


677 Washington
Blvd., 6th floor tower

Stamford, CT  06901

Attention:  Marc Ferrante

Fax:  +1 (203) 719-3888


 


With a further
copy to:


 


Kaye Scholer
LLP

425 Park Avenue

New York, New York  10022

Attention:  Henry G. Morriello, Esq.

Fax:  +1 (212) 836-8689

email:  hmorriello@kayescholer.com


 


or, as to each
party, at such other address as shall be designated by such party in a written
notice to each other party complying as to delivery with the terms of this
Section 8.02. Each such notice shall be effective (a) upon receipt when sent
through the mails, registered or certified mail, return receipt requested,
postage prepaid, with such receipt to be effective the date of delivery
indicated on the return receipt, or (b) one Business Day after delivery to an
overnight courier, or (c) on the date personally delivered to an authorized
officer of the party to which sent, or (d) on the date transmitted by legible
telecopier transmission with a confirmation of receipt.


 


Section
8.03 No Waiver; Remedies. No failure on the part of the
Collateral Agent to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and
not exclusive of any remedies provided by law.


 


Section
8.04 Severability; Enforcement. (a)  If any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof shall not in any way be affected or impaired.


 


(b)           Each
Borrower Subsidiary’s grant of a security interest shall be limited so as to
secure the Secured Obligations in an amount equal to the largest amount that
would not render such grant avoidable, invalid or unenforceable on account of
Section 548 of the United States Bankruptcy Code, any applicable provision of
comparable state law or any other state or federal bankruptcy, insolvency,
reorganization or other law affecting the rights of creditors generally.


 


Section
8.05 Continuing Security Interest; Assignments. Subject to
Section 8.06(b), this Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until the earlier
of the payment in full in cash of the Secured Obligations and the circumstances
specified in Section 8.06(b), (b) be binding upon each Grantor, its successors


 


35

















 


and assigns
and (c) inure, together with the rights and remedies of the Administrative
Agent and the Collateral Agent hereunder, to the benefit of the Secured Parties
and their respective successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), any Secured Party may assign or
otherwise transfer all or any portion of its rights and obligations under any
Transaction Document to which it is a party in accordance with the terms
thereof to any other Person or entity, and such other Person or entity shall
thereupon become vested with all the rights in respect thereof granted to such
Secured Party herein or otherwise. No Borrower Group Member may assign or
otherwise transfer all or any portion of its obligations hereunder.


 


Section
8.06 Release and Termination. (a)  Upon any sale, lease, transfer or other
disposition of any item of Collateral in accordance with the terms of this
Agreement and the Credit Agreement, the Collateral Agent (at the Administrative
Agent’s direction) will, at the Borrower’s expense, execute and deliver to the
Grantor of such item of Collateral such documents as such Grantor shall
reasonably request to evidence the release of such item of Collateral from the
assignment and security interest granted hereby, including the release of any
and all security deposits, maintenance reserves, letters of credit, insurance
or other proceeds and all other items related to the released Collateral.


 


(b)           Upon
the payment in full in cash of the Secured Obligations (and the expiration or
termination of all commitments of the Lenders under the Credit Agreement), the
pledge, assignment and security interest granted hereby shall terminate and all
rights to the Collateral shall revert to the applicable Grantors. Upon receipt
of a written notice from the Administrative Agent specifying any such
termination, the Collateral Agent (at the Administrative Agent’s direction)
will, at the Borrower’s expense, execute and deliver to each relevant Grantor
such documents as such Grantor shall prepare and reasonably request to evidence
such termination (and, as appropriate, redeliver certificates or other
instruments representing or evidencing any of the Collateral).


 


Section
8.07 Limited Recourse. All amounts payable by the Borrower
in respect of its obligations hereunder shall be recoverable only from and to
the extent of the assets of the Borrower and any proceeds thereof. No recourse
under any obligation of the borrower evidenced by this Agreement shall be had
against any shareholder, officer or director of the Borrower, by the enforcement
of any assessment or by any proceeding by virtue of any statute or otherwise;
it being expressly agreed and understood that this Agreement evidences a
corporate obligation of the Borrower and no personal liability shall attach to
or be incurred by the shareholders, officers, agents or directors of the
Borrower as such, or any of them under or by reason of any of the obligations
evidenced by this Agreement, and that any and all personal liability for
braches by the Borrower of any of such obligations, covenants or agreements,
either at law or by statute or constitution, of every such shareholder,
officer, agent or director is hereby expressly waived by the Collateral Agent
and the Administrative Agent.


 


Section
8.08 Governing Law. THIS AGREEMENT, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE HEREOF, SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL SUBSTANTIVE LAWS OF
THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES
THEREOF (OTHER THAN § 5-1401 OF THE GENERAL OBLIGATIONS LAW).


 


36

















 


Section
8.09 Jurisdiction. (a) 
Each of the parties hereto irrevocably agrees that the courts sitting in
the borough of Manhattan in the City of New York shall have jurisdiction to
hear and determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and, for such
purposes, irrevocably submits to the jurisdiction of such courts. Each of the
parties hereto irrevocably waives any objection which it might now or hereafter
have to the federal U.S. or New York State courts located in New York, New York
being nominated as the forum to hear and determine any suit, action or
proceeding, and to settle any disputes, which may arise out of or in connection
with this Agreement and agrees not to claim that any such court is not a
convenient or appropriate forum. Each Non-U.S. Borrower Group Member agrees
that the process by which any suit, action or proceeding is begun may be served
on it by being delivered in connection with any suit, action or proceeding in
the City of New York to National Registered Agents, Inc., with an office on the
date hereof at 875 Third Avenue, Suite 501, New York, New York 10001, and each
of them hereby appoints National Registered Agents, Inc. its designee,
appointee and agent to receive, accept and acknowledge for and on its behalf
such service of legal process.


 


(b)           Each
Grantor hereby consents generally in respect of any legal action or proceeding
arising out of or in connection with this Agreement to the giving of any relief
or the issue of any process in connection with such action or proceeding,
including the making, enforcement or execution against any property whatsoever
(irrespective of its use or intended use) of any order or judgment which may be
made or given in such action or proceeding.


 


Section
8.10 Counterparts. This Agreement may be executed in two or
more counterparts by the parties hereto, and each such counterpart shall be
considered an original and all such counterparts shall constitute one and the
same instrument. Delivery of an executed counterpart of a signature page to
this Agreement by facsimile or electronic mail shall be effective as delivery
of a manually executed counterpart of this Agreement.


 


Section
8.11 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
8.12 Effectiveness; Date of this Agreement. This Agreement
shall be effective when executed and delivered by each party hereto.


 


Section
8.13 Administrative Agent Approvals. Whenever the
Administrative Agent is permitted hereunder to exercise an approval right (or
whenever it is stated that a certain matter must be satisfactory to the
Administrative Agent), the Administrative Agent may exercise grant such approval
(or find such matter satisfactory) without the consent of the Lenders.


 


37

















 


IN WITNESS
WHEREOF, the
parties hereto have caused this Agreement to be duly executed and delivered by
its representative or officer thereunto duly authorized as of the date first
above written.


 


	
   

  	
  AERFUNDING 1LIMITED

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Liam J. Meabe

  	
   

  
	
   

  	
   

  	
  Name:

  	
  LIAM J. MEABE

  
	
   

  	
   

  	
  Title:

  	
  DIRECTOR

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK TRUST COMPANY

  
	
   

  	
  AMERICAS, as Collateral Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eileen M. Hughes

  	
   

  
	
   

  	
   

  	
  Name:

  	
  EILEEN M. HUGHES

  
	
   

  	
   

  	
  Title:

  	
  VICE
  PRESIDENT

  
	
   

  	
   

  
	
   

  	
  By:

  	
  [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
  Name:

  	
  [ILLEGIBLE]

  
	
   

  	
   

  	
  Title:

  	
  VICE
  PRESIDENT

  
	
   

  	
   

  
	
   

  	
  UBS
  SECURTTIES LLC, as
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Prakash Wadhwani

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Prakash Wadhwani

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mostafiz Shahmohammed

  	
   

  
	
   

  	
   

  	
  Name:

  	
  MOSTAFIZ SHAHMOHAMMED

  
	
   

  	
   

  	
  Title:

  	
  EXECUTIVE
  DIRECTOR

  
					



 


[Security
Trust Agreement]


 


38

















 


SCHEDULE
I


Security Trust
Agreement


 


PLEDGED
STOCK


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Number of

  	
   

  	
  Shares Issued

  	
   

  
	
  Stock Issuer

  	
   

  	
  Par Value

  	
   

  	
  Certificate No(s).

  	
   

  	
  Shares Pledged

  	
   

  	
  and Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED MEMBERSHIP INTERESTS


 


	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
  Borrower

  	
   

  	
  Certificate No.

  	
   

  	
  Membership Interests

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED BENEFICIAL INTERESTS


 


All of the
beneficial interests created in the trusts pursuant to each Trust Agreement
listed on Schedule V attached hereto.


 

















 


SCHEDULE II


Security Trust
Agreement


 


NON-TRUSTEE ACCOUNT INFORMATION


 


	
   

  	
   

  	
  NAME AND ADDRESS OF

  	
   

  	
   

  	
   

  
	
  NAME AND ADDRESS

  	
   

  	
  NON-TRUSTEE

  	
   

  	
   

  	
   

  
	
  OF BANK

  	
   

  	
  ACCOUNT HOLDER

  	
   

  	
  ACCOUNT NUMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


SCHEDULE III


Security Trust
Agreement


 


TRADE NAMES


 


None


 

















 


SCHEDULE IV

Security Trust Agreement


 


JURISDICTION OF ORGANIZATION, CHIEF PLACE OF
BUSINESS

AND CHIEF EXECUTIVE OR REGISTERED OFFICE


 


	
   

  	
   

  	
  Chief Executive Office, Chief Place of

  	
   

  
	
  Name of Grantor

  	
   

  	
  Business and Registered Office, Jurisdiction

  	
   

  
	
  AerFunding 1 Limited

  	
   

  	
  AerFunding 1
  Limited

  	
   

  
	
   

  	
   

  	
  Clarendon House

  	
   

  
	
   

  	
   

  	
  2 Church Street

  	
   

  
	
   

  	
   

  	
  Hamilton, HM 11

  	
   

  
	
   

  	
   

  	
  Bermuda

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [Other Grantors]

  	
   

  	
   

  	
   

  



 

















 


SCHEDULE V

Security Trust Agreement


 


TRUST AGREEMENTS


 


None


 

















 


EXHIBIT A

Security Trust Agreement


 


RESERVED


 

















 


EXHIBIT B-1

Security Trust Agreement


 


[FORM OF COLLATERAL SUPPLEMENT]


 


Deutsche Bank
Trust Company Americas

60 Wall Street, 26th Floor

New York, NY  10005


Attention:  Trust and Securities Services/Structured
Finance Services


 


[Date]


 


Attention:


 


Re:  Security Trust Agreement,
dated as of April 26, 2006


 


Ladies and
Gentlemen:


 


Reference is
made to the Security Trust Agreement (the “Security Trust Agreement”), dated as
of April 26, 2006 among AerFunding 1 Limited, a Bermuda company (the “Borrower”),
the Borrower Subsidiaries listed on the signature pages of, or who otherwise
become grantors under, the Security Trust Agreement (together with the
Borrower, the “Grantors”), Deutsche Bank Trust Company Americas (“DBTCA”) as
Collateral Agent, and UBS Securities LLC, as Administrative Agent. Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to them in the Security Trust Agreement.


 


The
undersigned hereby delivers, as of the date first above written, the attached
Annexes I and II pursuant to Section 2.18 of the Security Trust Agreement.


 


The
undersigned Grantor hereby confirms that the property included in the attached
Annexes constitutes part of the Collateral and hereby makes each representation
and warranty set forth in Section 2.03 of the Security Trust Agreement (as
supplemented by the attached Annexes) with respect to such property.


 


Attached are
(i) a Control Agreement in substantially in the form approved in writing by
each of the Transaction Agents from each Non-Trustee Account Bank at which each
Non-Trustee Account included in the foregoing Collateral is maintained, (ii)
where required with respect to any Assigned Document (other than an Assigned
Lease) included in the foregoing Collateral, a Consent and Agreement in
substantially the form of Exhibit D to the Security Trust Agreement from the
counterparty thereto or, with respect to any Assigned Lease included in the
foregoing Collateral, such consents, acknowledgements and/or notices as are
called for under


 

















 


Section
2.08(a) of the Security Trust Agreement and (iii) duly completed copies of
Annexes I and II hereto.


 


2

















 


This
Collateral Supplement shall in all respects be governed by, and construed in accordance
with, the internal substantive laws of the State of New York (without giving
effect to conflicts of law principles thereof), including all matters of
construction, validity and performance.


 


	
   

  	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME OF
  GRANTOR](1)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  



 


Acknowledged
and agreed to as of the date first above written:


 


DEUTSCHE BANK TRUST COMPANY AMERICAS,

not in its individual capacity, but

solely as Collateral Agent


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


 






	
  (1)

  	
  If any Irish
  incorporated company is a party to this Agreement, use the following

  
	
   

  	
  execution
  block:

  
	
   

  	
   

  
	
   

  	
   

  	
  “Signed
  Sealed and Delivered

  
	
   

  	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  the duly
  appointed attorney of

  
	
   

  	
   

  	
  [                                              ]

  
	
   

  	
   

  	
  in the
  presence of:”

  



 


3

















 


ANNEX I

Collateral Supplement


 


PLEDGED STOCK


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Number of

  	
   

  	
  Shares Issued

  	
   

  
	
  Stock Issuer

  	
   

  	
  Par Value

  	
   

  	
  Certificate No(s).

  	
   

  	
  Shares Pledged

  	
   

  	
  and Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  100%

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED BENEFICIAL INTERESTS


 


	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
  Issuer

  	
   

  	
  Certificate No.

  	
   

  	
  Beneficial Interests

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED MEMBERSHIP INTERESTS(1)


 


	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
  Issuer

  	
   

  	
  Certificate No.

  	
   

  	
  Membership Interests

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED DEBT


 


	
  Debt Issuer

  	
   

  	
  Description of Debt

  	
   

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


ANNEX II

Collateral Supplement


 


NON-TRUSTEE ACCOUNT INFORMATION


 


	
   

  	
   

  	
  NAME AND ADDRESS OF

  	
   

  	
   

  	
   

  
	
  NAME AND ADDRESS

  	
   

  	
  NON-TRUSTEE

  	
   

  	
   

  	
   

  
	
  OF BANK

  	
   

  	
  ACCOUNT HOLDER

  	
   

  	
  ACCOUNT NUMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


EXHIBIT B-2

Security Trust Agreement


 


[FORM OF GRANTOR SUPPLEMENT]


 


Deutsche Bank
Trust Company Americas, as Collateral Agent

60 Wall Street, 26th Floor

New York, NY  10005

Attention:  Trust and Securities
Services/Structured Finance Services


 


[Date]


 


Attention:


 


Re:  Security Trust Agreement,
dated as of April 26, 2006


 


Ladies and
Gentlemen:


 


Reference is
made to the Security Trust Agreement (the “Security Trust Agreement”), dated as
of April 26, 2006 among AerFunding 1 Limited, a Delaware statutory trust (the “Borrower”),
the Borrower Subsidiaries listed on the signature pages of, or who otherwise
become grantors under, the Security Trust Agreement (together with the
Borrower, the “Grantors”), Deutsche Bank Trust Company Americas, a national
banking association (“DBTCA”) as Collateral Agent, and UBS Securities LLC, as
Administrative Agent. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to them in the Security Trust
Agreement.


 


The
undersigned hereby agrees, as of the date first above written, to become a
Grantor under the Security Trust Agreement as if it were an original party
thereto and agrees that each reference in the Security Trust Agreement to “Grantor”
shall also mean and be a reference to the undersigned.


 


To secure the
Secured Obligations, the undersigned Grantor hereby assigns and pledges to the
Collateral Agent for its benefit and the benefit of the Secured Parties, and
hereby grants to the Collateral Agent for its benefit and the benefit of the
Secured Parties, a security interest in, all of its right, title and interest
in and to:


 


[To be completed
as appropriate]


 

















 


The
undersigned Grantor hereby makes each representation and warranty set forth in
Section 2.03 of the Security Trust Agreement (as supplemented by the attached
Annexes) and hereby agrees to be bound as a Grantor by all of the terms and
provisions of the Security Trust Agreement. Each reference in the Security
Trust Agreement to the Pledged Stock, the Pledged Debt, the Pledged Beneficial
Interests, the Pledged Membership Interests, the Security Collateral, the
Beneficial Interest Collateral, the Membership Interest Collateral, the Bank
Account Collateral, the Investment Collateral, the Assigned Agreement, the
Assigned Agreement Collateral, the Aircraft Purchase Collateral, the Assigned
Leases, the Service Provider Documents, the Servicing Collateral, the Lease
Collateral, and the Assigned Documents shall be construed to include a
reference to the corresponding Collateral hereunder.


 


Attached are
(i) a Control Agreement in substantially in the form approved in writing by
each of the Transaction Agents from each Non-Trustee Account Bank at which each
Non-Trustee Account included in the foregoing Collateral is maintained, (ii)
where required with respect to any Assigned Document (other than an Assigned
Lease) included in the foregoing Collateral, a Consent and Agreement in
substantially the form of Exhibit D to the Security Trust Agreement from the
counterparty thereto or, with respect to any Assigned Lease included in the
foregoing Collateral, such consents, acknowledgements and/or notices as are
called for under Section 2.08(a) of the Security Trust Agreement, (iii) duly
completed copies of Annexes I, II, III and IV hereto [and (iv) an Irish Share
Mortgage] [insert if applicable].


 


2

















 


This Grantor
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.


 


	
   

  	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME OF
  GRANTOR](1)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  



 


Acknowledged
and agreed to as of the date first above written:


 


DEUTSCHE BANK TRUST COMPANY AMERICAS,

not in its individual capacity, but

solely as Collateral Agent


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


 






	
  (1)

  	
  If any Irish
  incorporated company is a party to this Agreement, use the following

  
	
   

  	
  execution
  block:

  
	
   

  	
   

  
	
   

  	
   

  	
  “Signed
  Sealed and Delivered

  
	
   

  	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  the duly
  appointed attorney of

  
	
   

  	
   

  	
  [                                              ]

  
	
   

  	
   

  	
  in the
  presence of:”

  



 


3

















 


ANNEX I

Grantor Supplement


 


PLEDGED STOCK


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Number of

  	
   

  	
  Outstanding

  	
   

  
	
  Stock Issuer

  	
   

  	
  Par Value

  	
   

  	
  Certificate No(s).

  	
   

  	
  Shares

  	
   

  	
  Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  100%

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED BENEFICIAL INTERESTS


 


	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
  Issuer

  	
   

  	
  Certificate No.

  	
   

  	
  Beneficial Interests

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED MEMBERSHIP INTERESTS


 


	
   

  	
   

  	
   

  	
   

  	
  Percentage of

  	
   

  
	
  Issuer

  	
   

  	
  Certificate No.

  	
   

  	
  Membership Interests

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


PLEDGED DEBT


 


	
  Debt Issuer

  	
   

  	
  Description of Debt

  	
   

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


ANNEX II

Grantor Supplement


 


NON-TRUSTEE ACCOUNT INFORMATION


 


	
   

  	
   

  	
  NAME AND ADDRESS OF

  	
   

  	
   

  	
   

  
	
  NAME AND ADDRESS

  	
   

  	
  NON-TRUSTEE

  	
   

  	
   

  	
   

  
	
  OF BANK

  	
   

  	
  ACCOUNT HOLDER

  	
   

  	
  ACCOUNT NUMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


ANNEX III

Grantor Supplement


 


TRADE NAMES


 

















 


ANNEX IV

Grantor Supplement


 


	
   

  	
   

  	
  CHIEF EXECUTIVE

  	
   

  	
  CHIEF PLACE OF

  	
   

  	
  REGISTERED

  	
   

  
	
  NAME OF GRANTOR

  	
   

  	
  OFFICE

  	
   

  	
  BUSINESS

  	
   

  	
  OFFICE

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 

















 


EXHIBIT C

Security Trust Agreement


 


RESERVED


 

















 


EXHIBIT D

Security Trust Agreement


 


FORM OF NOTICE AND ACKNOWLEDGMENT


 

















 


EXHIBIT E

Security Trust Agreement


 


FORM OF IRISH SHARE MORTGAGE