Document:

Exhibit 10.14

 

EXECUTION VERSION

 

FIRST AMENDMENT AND WAIVER

 

FIRST
AMENDMENT AND WAIVER, dated as of December 10, 2007 (this “First Amendment
and Waiver”), to the Term Loan Agreement, dated as of August 14, 2007
(the “Term Loan Agreement”), among New ATA Acquisition Inc., a Delaware
corporation (the “Company”), the several lenders from time to time
parties thereto (the “Lenders”), Jefferies Finance LLC, as documentation
agent, and JPMorgan Chase Bank, N.A., as administrative agent for the Lenders
thereunder (in such capacity, the “Administrative Agent”).

 

W  I  T  N  E  S  S
E  T  H:

 

WHEREAS,
the Company, the Lenders and the Administrative Agent are parties to the Term
Loan Agreement;

 

WHEREAS,
the Company has requested that the Lenders amend and waive certain terms in the
Term Loan Agreement in the manner provided for herein; and

 

WHEREAS,
the Administrative Agent and the Lenders party hereto are willing to agree to
the requested amendment and waiver subject to the provisions of this First
Amendment and Waiver;

 

NOW,
THEREFORE, in consideration of the premises contained herein, the parties hereto
agree as follows:

 

1.     Defined Terms.     Unless otherwise defined herein, terms
which are defined in the Term Loan Agreement and used herein as defined terms
are so used as so defined.

 

2.     Amendment to Section 5.2(d).   Section 5.2(d) of the Term Loan
Agreement is hereby amended by deleting such Section 5.2(d) in its
entirety and substituting in lieu thereof the following:

 

“(d) unless available pursuant to public filings, concurrently
with the delivery of the financial statements referred to in Sections 5.1(a) and
5.1(b), a narrative discussion and analysis of the financial condition and
results of operations of the Company and its Subsidiaries for such fiscal
quarter and for the period from the beginning of the then-current fiscal year
to the end of such fiscal quarter, as compared to the comparable periods of the
previous year; provided that such narrative discussion and analysis with
respect to such periods ending September 30, 2007, shall not be required
to be so furnished until the delivery of a Preliminary OM covering the fiscal quarter
ending September 30, 2007, pursuant to Section 5.9(c);

 

3.     Amendment to Section 5.9(a).    (a) Subclause (x) of Section 5.9(a) of
the Term Loan Agreement is hereby amended by deleting such subclause (x) in
its entirety and substituting in lieu thereof the following:

 

“(x) after
a reasonable marketing period (including a road show) that does not commence until
the delivery of a Preliminary OM pursuant to Section 5.9(c) and”

 

(b) Subclause
(y) of Section 5.9(a) of the Term Loan Agreement is hereby
amended by deleting the word “twice” appearing therein and substituting, in
lieu thereof, the words “four times, but in no event earlier than January 2,
2008”.

 

 

4.     Amendment to Section 5.9(c).    Section 5.9(c) of the Term Loan
Agreement is hereby amended by deleting such Section 5.9(c) in its
entirety and substituting in lieu thereof the following:

 

“(c) No later than 15 days (or such longer period, not to exceed
30 days, as is determined by the Administrative Agent to be reasonably
necessary) after delivery by the Administrative Agent of a Securities Demand,
the Company will deliver (and, if applicable, cause Holdings to deliver)
preliminary offering memoranda or preliminary prospectuses and other marketing materials
relating to the Senior ATA Notes usable in a customary high-yield road show
(with the industry section being written by Seabury Group or any other airline
industry expert having similar qualifications), which shall be reasonably
satisfactory to the Administrative Agent and shall comply with the rules and
regulations (including Regulation S-X) of the Securities Act, and shall in any
event include information that would be required in a registration statement on
Form S-1 for an offering registered under the Securities Act, including
without limitation the unaudited (or, in the case of fiscal years, audited)
financial statements of the Company (and, if applicable, Holdings) for the most
recent fiscal quarter or fiscal year then ended (each, a “Preliminary OM”); provided that no
Preliminary OM covering a particular fiscal quarter or fiscal year shall be required
to be delivered prior to the date that is 15 days after financial statements
covering such quarter or year are delivered pursuant to Section 5.1(a) or
5.1(b), as applicable.”

 

5        Amendment to Section 7.  Subclause (c) of Section 7 of the
Term Loan Agreement is hereby amended by deleting such subclause (c) in
its entirety and substituting in lieu thereof the following:

 

“(c) the Company shall default in the observance or performance of
any agreement contained in Section 5.9, Section 5.10 or Section 6;
or”

 

6.     Waiver of Section 5.1(b).    Notwithstanding anything in the Term Loan
Agreement to the contrary, the Lenders hereby waive (x) compliance with
the requirements of Section 5.1(b) of the Term Loan Agreement, solely
with respect to the quarterly period ended September 30, 2007, until and including
December 17, 2007, and (y) any Default or Event of Default that may
have resulted from the failure of the Company to comply with such requirements
prior to the effectiveness of this First Amendment and Waiver. It is agreed
that, if the items described in Section 5.1(b) with respect to such quarterly
period are not delivered by December 17, 2007, then an Event of Default
with respect to such Section shall thereafter be in existence, without
requirement of delivery of notice or any other action.

 

7.     Waiver of Section 5.9(c).    Notwithstanding anything in the Term Loan
Agreement to the contrary, the Lenders hereby waive any Default or Event of
Default that may have resulted from the failure of the Company to comply with
the requirements of Section 5.9(c) of the Term Loan Agreement prior
to the effectiveness of this First Amendment and Waiver.

 

8.     Representations and
Warranties.      On and as
of the date hereof, the Company hereby confirms that, after giving effect to
this First Amendment and Waiver, the representations and warranties set forth in
Section 3 of the Term Loan Agreement are true and correct in all material
respects, except to the extent that such representations and warranties
expressly relate to an earlier date (in which case, the Company hereby confirms
that such representations and warranties are true and correct in all material
respects as of such earlier date).

 

9.     Effectiveness of First
Amendment and Waiver.     This
First Amendment and Waiver shall become effective as of the date hereof when
the Administrative Agent shall have received counterparts of this First
Amendment and Waiver duly executed by the Company and the Required Lenders.

 

2

 

10.
Continuing Effect; No Other Amendments, Waivers or Consents.       Except as expressly provided herein, all
of the terms and provisions of the Term Loan Agreement are and shall remain in
full force and effect. The waiver provided for herein is limited to the
specific Section of the Term Loan Agreement specified herein and shall not
constitute a consent, waiver or amendment of, or an indication of the
Administrative Agent’s or the Lenders’ willingness to consent to any action
requiring consent under any other provisions of the Term Loan Agreement or the
same subsection for any other date or time period. This First Amendment and
Waiver shall be binding on the parties hereto and their respective successors
and permitted assigns under the Term Loan Agreement.

 

11.
Expenses.        The
Company agrees to pay and reimburse the Administrative Agent for all its reasonable
and documented out-of-pocket costs and expenses incurred in connection with the
preparation and delivery of this First Amendment and Waiver, including, without
limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent, in each case to the extent required to be paid or reimbursed
pursuant to Section 9.5 of the Term Loan Agreement.

 

12.
Counterparts.  This
First Amendment and Waiver may be executed in any number of counterparts by the
parties hereto (including by facsimile transmission), each of which
counterparts when so executed shall be an original, but all the counterparts
shall together constitute one and the same instrument.

 

13.
GOVERNING LAW.       THIS
FIRST AMENDMENT AND WAIVER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

[Remainder of page intentionally left blank]

 

3

 

IN WITNESS WHEREOF, the parties hereto have caused
this First Amendment and Waiver to be duly executed by their respective
authorized officers as of the day and year first above written.

 

 

	
   

  	
  NEW ATA ACQUISITION INC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ William Garrett

  	
   

  
	
   

  	
  Name: 

  	
  William Garrett

  
	
   

  	
  Title: 

  	
  EVP & CFO

  
						

 

[Signature Page to First Amendment and Waiver]

 

 

	
   

  	
  JPMORGAN
  CHASE BANK, NA., as Administrative

  
	
   

  	
  Agent
  and as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Matthew II.Massic

  	
   

  
	
   

  	
  Name:
  

  	
  Matthew
  II.Massic

  
	
   

  	
  Title:
  

  	
  Managing
  Director

  
						

 

[Signature
Page to First Amendment and Waiver]

 

	
   

  	
  JEFFERIES
  FINANCE LLC, as Documentation Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/E.J.
  Hess

  	
   

  
	
   

  	
  Name:
  

  	
  E.J.
  Hess

  
	
   

  	
  Title:
  

  	
  Managing
  Director

  
							

 

	
   

  	
  JEFFERIES
  FINANCE CP FUNDING LLC, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/E.J.
  Hess

  	
   

  
	
   

  	
  Name:
  

  	
  E.J.
  Hess

  
	
   

  	
  Title:
  

  	
  Managing
  DirectorExhibit 10.15

 

EXECUTION VERSION

 

 

GUARANTEE AND COLLATERAL
AGREEMENT

 

made by

 

GLOBAL AERO LOGISTICS INC.,

 

NEW ATA INVESTMENT INC.,

 

NEW ATA ACQUISITION INC.

 

and

 

THE GUARANTORS IDENTIFIED
HEREIN

 

in favor of

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

Dated as of August 14,
2007

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.

  	
   

  	
  DEFINED TERMS

  	
   

  	
  1

  
	
   1.1.

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   1.2.

  	
   

  	
  Other Definitional Provisions

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.

  	
   

  	
  GUARANTEE

  	
   

  	
  5

  
	
   2.1.

  	
   

  	
  Guarantee

  	
   

  	
  5

  
	
   2.2.

  	
   

  	
  Right of Contribution

  	
   

  	
  6

  
	
   2.3.

  	
   

  	
  No Subrogation

  	
   

  	
  6

  
	
   2.4.

  	
   

  	
  Amendments, etc., with respect to the
  Borrower Obligations

  	
   

  	
  6

  
	
   2.5.

  	
   

  	
  Guarantee Absolute and Unconditional

  	
   

  	
  7

  
	
   2.6.

  	
   

  	
  Reinstatement

  	
   

  	
  7

  
	
   2.7.

  	
   

  	
  Payments

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.

  	
   

  	
  GRANT OF SECURITY INTEREST

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.

  	
   

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  10

  
	
   4.1.

  	
   

  	
  Title; No Other Liens

  	
   

  	
  10

  
	
   4.2.

  	
   

  	
  Perfected First Priority Liens

  	
   

  	
  10

  
	
   4.3.

  	
   

  	
  Jurisdiction of Organization

  	
   

  	
  11

  
	
   4.4.

  	
   

  	
  Inventory and Equipment

  	
   

  	
  11

  
	
   4.5.

  	
   

  	
  Farm Products

  	
   

  	
  11

  
	
   4.6.

  	
   

  	
  Investment Property

  	
   

  	
  11

  
	
   4.7.

  	
   

  	
  Receivables

  	
   

  	
  11

  
	
   4.8.

  	
   

  	
  Intellectual Property

  	
   

  	
  11

  
	
   4.9.

  	
   

  	
  Commercial Tort Claims

  	
   

  	
  12

  
	
   4.10.

  	
   

  	
  Deposit Accounts, Etc.

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.

  	
   

  	
  COVENANTS

  	
   

  	
  12

  
	
   5.1

  	
   

  	
  Delivery of Instruments, Certificated
  Securities and Chattel Paper

  	
   

  	
  12

  
	
   5.2.

  	
   

  	
  Maintenance of Insurance

  	
   

  	
  12

  
	
   5.3.

  	
   

  	
  Maintenance of Perfected Security Interest;
  Further Documentation

  	
   

  	
  12

  
	
   5.4.

  	
   

  	
  Changes in Locations, Name, etc.

  	
   

  	
  13

  
	
   5.5.

  	
   

  	
  Notices

  	
   

  	
  13

  
	
   5.6.

  	
   

  	
  Investment Property

  	
   

  	
  13

  
	
   5.7.

  	
   

  	
  Receivables

  	
   

  	
  14

  
	
   5.8.

  	
   

  	
  Intellectual Property

  	
   

  	
  15

  
	
   5.9.

  	
   

  	
  Commercial Tort Claims

  	
   

  	
  16

  
	
   5.10.

  	
   

  	
  Deposit Accounts

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.

  	
   

  	
  REMEDIAL PROVISIONS

  	
   

  	
  17

  
	
   6.1.

  	
   

  	
  Certain Matters Relating to Receivables

  	
   

  	
  17

  
	
   6.2.

  	
   

  	
  Communications with Obligors; Grantors
  Remain Liable

  	
   

  	
  17

  
	
   6.3.

  	
   

  	
  Pledged Equity

  	
   

  	
  18

  
	
   6.4.

  	
   

  	
  Proceeds to be Turned Over to
  Administrative Agent

  	
   

  	
  19

  
	
   6.5.

  	
   

  	
  Application of Proceeds

  	
   

  	
  19

  
	
   6.6.

  	
   

  	
  Code and Other Remedies

  	
   

  	
  19

  
	
   6.7.

  	
   

  	
  Registration Rights

  	
   

  	
  20

  

 

i

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   6.8.

  	
   

  	
  Deficiency

  	
   

  	
  21

  
	
   6.9.

  	
   

  	
  Notice of Sole Control

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.

  	
   

  	
  THE ADMINISTRATIVE AGENT

  	
   

  	
  21

  
	
   7.1

  	
   

  	
  Administrative Agent’s Appointment as
  Attorney-in-Fact, etc.

  	
   

  	
  21

  
	
   7.2.

  	
   

  	
  Duty of Administrative Agent

  	
   

  	
  23

  
	
   7.3.

  	
   

  	
  Execution of Financing Statements

  	
   

  	
  23

  
	
   7.4.

  	
   

  	
  Authority of Administrative Agent

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 8.

  	
   

  	
  MISCELLANEOUS

  	
   

  	
  24

  
	
   8.1.

  	
   

  	
  Amendments in Writing

  	
   

  	
  24

  
	
   8.2.

  	
   

  	
  Notices

  	
   

  	
  24

  
	
   8.3.

  	
   

  	
  No Waiver by Course of Conduct; Cumulative
  Remedies

  	
   

  	
  24

  
	
   8.4.

  	
   

  	
  Enforcement Expenses; Indemnification

  	
   

  	
  24

  
	
   8.5.

  	
   

  	
  Successors and Assigns

  	
   

  	
  25

  
	
   8.6.

  	
   

  	
  Setoff

  	
   

  	
  25

  
	
   8.7.

  	
   

  	
  Counterparts

  	
   

  	
  25

  
	
   8.8.

  	
   

  	
  Severability

  	
   

  	
  25

  
	
   8.9.

  	
   

  	
  Section Headings

  	
   

  	
  26

  
	
   8.10.

  	
   

  	
  Integration

  	
   

  	
  26

  
	
   8.11.

  	
   

  	
  GOVERNING LAW

  	
   

  	
  26

  
	
   8.12.

  	
   

  	
  Submission To Jurisdiction; Waivers

  	
   

  	
  26

  
	
   8.13.

  	
   

  	
  Acknowledgments

  	
   

  	
  26

  
	
   8.14.

  	
   

  	
  Additional Guarantors and Grantors

  	
   

  	
  27

  
	
   8.15.

  	
   

  	
  Releases

  	
   

  	
  27

  
	
   8.16.

  	
   

  	
  WAIVER OF JURY TRAIL

  	
   

  	
  27

  
	
   8.17.

  	
   

  	
  Effectiveness of the Merger; Assignment and
  Delegation to and Assumption by the Target

  	
   

  	
  28

  

 

SCHEDULES

 

	
  Schedule 1

  	
  Notice Addresses

  
	
  Schedule 2

  	
  Investment Property

  
	
  Schedule 3

  	
  Perfection Matters

  
	
  Schedule 4

  	
  Jurisdictions of Organization

  
	
  Schedule 5

  	
  Inventory and Equipment Locations

  
	
  Schedule 6

  	
  Intellectual Property

  
	
  Schedule 7

  	
  Commercial Tort Claims

  
	
  Schedule 8

  	
  Deposit Accounts

  

 

 

Acknowledgment and Consent

 

ANNEX

 

	
  Annex 1

  	
  Form of Assumption Agreement

  

 

ii

 

GUARANTEE AND COLLATERAL AGREEMENT, dated as
of August 14, 2007, made by each of the signatories hereto (together with
any other entity that may become a party hereto as provided herein, the “Grantors”),
in favor of JPMorgan Chase Bank, N.A., as administrative agent (in such
capacity, the “Administrative Agent”) for the Secured Parties (as
defined below).

 

W
I  T  N  E  S  S  E  T  H:

 

WHEREAS, pursuant to the Term Loan Agreement,
dated as of August 14, 2007 (as amended, supplemented or otherwise
modified from time to time, the “Term Loan Agreement”), among New ATA
Acquisition Inc. (the “Borrower”), the Lenders, the Administrative Agent
and the other parties thereto, the Lenders have severally agreed to make term
loans to the Borrower upon the terms and subject to the conditions set forth
therein;

 

WHEREAS, pursuant to the Term Loan Agreement,
loans made by the Lenders may be exchanged for Exchange Notes issued pursuant
to the Indenture upon the Initial Maturity Date (as defined in the Term Loan
Agreement);

 

WHEREAS, the Borrower is a member of an
affiliated group of companies that, following the consummation of the Merger,
will include each other Grantor;

 

WHEREAS, the proceeds of the term loans under
the Term Loan Agreement will be used in part enable the Borrower to make
valuable transfers to one or more of the other Grantors in connection with the
operation of their respective businesses;

 

WHEREAS, the Borrower and the other Grantors
and engaged in related businesses, and each Grantor will derive substantial
direct and indirect benefit from the making of the term loans under the Term
Loan Agreement, and

 

WHEREAS, it is a condition precedent to the
obligation of the Lenders to make their respective term loans to the Borrower
under the Term Loan Agreement that the Grantors shall have executed and
delivered this Agreement to the Administrative Agent for the ratable benefit of
the Secured Parties;

 

NOW, THEREFORE, in consideration of the
premises and to induce the Administrative Agent and the Lenders to enter into
the Term Loan Agreement and to induce the Lenders to make their respective
loans to the Borrower thereunder, each Grantor hereby agrees with the Administrative
Agent, for the ratable benefit of the Secured Parties, as follows:

 

SECTION 1.           DEFINED TERMS

 

1.1.          Definitions.  (a) Unless
otherwise defined herein, terms defined in the Term Loan Agreement and used
herein shall have the meanings given to them in the Term Loan Agreement, and
the following terms are used herein as defined in the New York UCC: Accounts,
Certificated Security, Chattel Paper, Commercial Tort Claims, Commodity
Account, Commodity Intermediary, Documents, Equipment, Farm Products, General
Intangibles, Instruments, Inventory, Letter of Credit Rights, Securities
Account, Securities Intermediary and Supporting Obligations.

 

(b)  The following terms shall have
the following meanings:

 

“Agreement”:  this Guarantee and Collateral Agreement,
as the same may be amended, supplemented or otherwise modified from time to
time.

 

 

“Borrower Obligations”:  the collective reference to
the unpaid principal of and interest on the Loans, any Exchange Notes and all
other monetary obligations and liabilities of the Borrower (including, without
limitation, interest accruing at the then applicable rate provided in the Term
Loan Agreement or, if Exchange Notes are outstanding, the Indenture, as
applicable, after the maturity of the Loans or the Exchange Notes, as the case
may be, and interest accruing at the then applicable rate provided in the Term
Loan Agreement or the Indenture, as applicable, after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization
or like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) to the
Administrative Agent, any Lender or, if Exchange Notes are outstanding, the
Trustee of any Holder, whether direct or indirect, absolute or contingent, due
or to become due, or now existing or hereafter incurred, which may arise under,
or pursuant to, the Financing Documents or any other document made, delivered
or given in connection with any of the foregoing, in each case whether on
account of principal, interest, reimbursement obligations, premium, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Administrative Agent, to the Lenders
and, if Exchange Notes are outstanding, to the Trustee or to the Holders, that
are required to be paid by the Borrower pursuant to the terms of any of the
foregoing agreements).

 

“Collateral”:  as defined in Section 3.

 

“Collateral Account”:  any collateral account
established by the Administrative Agent as provided in Section 6.1 or 6.4.

 

“Collateral Deposit Account”:  any Deposit Account
other than an Excluded Account.

 

“Copyrights”:  (i) all copyrights arising under
the laws of the United States, any other country or any political subdivision
thereof, whether registered or unregistered and whether published or
unpublished (including, without limitation, those listed in Schedule 6),
all registrations and recordings thereof, and all applications in connection
therewith, including, without limitation, all registrations, recordings and
applications in the United States Copyright Office, and (ii) the right to
obtain all renewals thereof.

 

“Copyright Licenses”:  any written agreement naming
any Grantor as licensor or licensee, granting any right under any Copyright,
including, without limitation, the grant of rights to manufacture, distribute,
exploit and sell materials derived from any Copyright.

 

“Deposit Account”:  as defined in the Uniform
Commercial Code of any applicable jurisdiction and, in any event, including,
without limitation, any demand, time savings, passbook or like account
maintained with a depositary institution.

 

“Deposit Account Control Agreement”:  an agreement in
form and substance reasonably satisfactory to the Administrative Agent, among
any Grantor, a banking institution holding such Grantor’s funds, and the
Administrative Agent with respect to collection and control of all deposits and
balances held in a Collateral Deposit Account maintained by any Grantor with
such banking institution.

 

“Excluded Accounts”:  (i) Deposit Accounts
exclusively used for payroll, payroll taxes and other employee wage and benefit
payments and any Deposit Account, Securities Account or Commodity Account with
an average annual balance of less than $1,000,000, or that is exclusively used
to hold Excluded Cash, (ii) Trust Tax Accounts, and (iii) Lessor
Maintenance Reserve Accounts.

 

2

 

“Excluded Cash”: cash and Cash Equivalents pledged or deposited
in accordance with clause (i), (iv), (xxiii), (xxiv), (xxviii) or (xxx) of the
definition of Permitted Liens in the Term Loan Agreement.

 

“Excluded Property”: as defined in Section 3.

 

“FAA Act”: the collective reference to the United States
Transportation Code (currently codified at Subtitle VII of Title 49 of the U.S.
Code) as amended, supplemented, or otherwise modified from time to time, and
all FARs and other rules, regulations, directives and orders issued or
promulgated from time to time thereunder.

 

“FAA Collateral”: Collateral as to which filing of a security
interest requires compliance with filing requirements of the FAA Act.

 

“FARs”: the FAA Regulations as in effect from time to time under
Title 14 of the U.S. Code of Federal Regulations, including, without
limitation, the Special Federal Aviation Regulations (as applicable), as
amended, supplemented or otherwise modified from time to time.

 

“Financing Documents”: the Term Loan Agreement, this Agreement,
the other Loan Documents, and, if Exchange Notes are outstanding, the Indenture
and the Exchange Notes.

 

“Foreign Subsidiary”: any direct or indirect Subsidiary of the
Borrower which is not a Domestic Subsidiary.

 

“Foreign Subsidiary Voting Stock”: the voting Capital Stock of
any Foreign Subsidiary and of any Domestic Subsidiary substantially all of
whose assets consist of voting Capital Stock of one or more Foreign
Subsidiaries.

 

“Guarantor Obligations”: with respect to any Guarantor, all
monetary obligations and liabilities of such Guarantor which may arise under or
pursuant to this Agreement (including, without limitation, Section 2) or
any other Financing Document to which such Guarantor is a party, in each case
whether on account of guarantee obligations, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to the Administrative Agent, to the Lenders and, if
Exchange Notes are outstanding, to the Trustee or to the Holders, that are
required to be paid by such Guarantor pursuant to the terms of this Agreement
or any other Financing Document).

 

“Guarantors”: the collective reference to each Grantor other
than the Borrower.

 

“Holdings”: Global Aero Logistics Inc., a Delaware corporation.

 

“Intellectual Property”: the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including,
without limitation, the Copyrights, the Copyright Licenses, the Patents, the
Patent Licenses, the Trademarks and the Trademark Licenses, and all rights to
sue at law or in equity for any infringement or other impairment thereof,
including the right to receive all proceeds and damages therefrom.

 

“Intercompany Note”: any promissory note evidencing loans made
by any Grantor to Holdings or any of its Subsidiaries.

 

3

 

“Investment Property”: the collective reference to (i) all
“investment property” as such term is defined in Section 9-102(a)(49) of
the New York UCC (other than any Foreign Subsidiary Voting Stock) and
(ii) whether or not constituting “investment property” as so defined, all
Pledged Debt and all Pledged Equity.

 

“Issuers”: the collective reference to each issuer of any
Investment Property.

 

“New York UCC”: the Uniform Commercial Code as from time to time
in effect in the State of New York.

 

“Obligations”: (i) in the case of each Borrower, its
Borrower Obligations, and (ii) in the case of each Guarantor, its
Guarantor Obligations.

 

“Patents”: (i) all letters patent of the United States, any
other country or any political subdivision thereof, all reissues and extensions
thereof and all goodwill associated therewith, including, without limitation,
any of the foregoing referred to in Schedule 6, (ii) all
applications for letters patent of the United States or any other country and
all divisions, continuations and continuations-in-part thereof, including,
without limitation, any of the foregoing referred to in Schedule 6, and
(iii) all rights to obtain any reissues or extensions of the foregoing.

 

“Patent License”: all agreements, whether written or oral,
providing for the grant by or to any Grantor of any right to manufacture, use
or sell any invention covered in whole or in part by a Patent, including,
without limitation, any of the foregoing referred to in Schedule 6.

 

“Pledged Debt”: all promissory notes listed on Schedule 2,
all Intercompany Notes at any time issued to any Grantor and all other
promissory notes issued to or held by any Grantor (other than promissory notes
issued in connection with extensions of trade credit by any Grantor in the
ordinary course of business).

 

“Pledged Equity”: the Capital Stock listed on Schedule 2,
together with any other shares, stock certificates, options or rights of any
nature whatsoever in respect of the Capital Stock of any Person that may be
issued or granted to, or held by, any Grantor while this Agreement is in
effect; provided that in no event shall more than 65% of the issued and
outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary or of any
Domestic Subsidiary substantially all of whose assets consist of voting Capital
Stock of one or more Foreign Subsidiaries be required to be pledged hereunder.

 

“Proceeds”: all “proceeds” as such term is defined in
Section 9-102(a)(64) of the New York UCC and, in any event, shall include,
without limitation, all dividends or other income from the Investment Property,
collections thereon or distributions or payments with respect thereto.

 

“Receivable”: any right to payment for goods sold or leased or
for services rendered, whether or not such right is evidenced by an Instrument
or Chattel Paper and whether or not it has been earned by performance
(including, without limitation, any Account).

 

“Secured Parties”: the collective reference to the
Administrative Agent, the Lenders and, if Exchange Notes are outstanding, the
Trustee and the Holders.

 

“Securities Act”: the Securities Act of 1933, as amended.

 

4

 

“Subsidiary Guarantor”: any Subsidiary of the Borrower that is
or becomes a party to this Agreement.

 

“Trademarks”: (i) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, trade styles,
service marks, logos and other source or business identifiers, and all goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
county or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, including, without limitation, any of the foregoing
referred to in Schedule 6, and (ii) the right to obtain all
renewals thereof.

 

“Trademark License”: any agreement, whether written or oral,
providing for the grant by or to any Grantor of any right to use any Trademark.

 

1.2.          Other Definitional Provisions.
(a) The words “hereof,” “herein,” “hereto” and “hereunder” and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section and Schedule
references are to this Agreement unless otherwise specified.

 

(b) The
meanings given to terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.

 

(c) Where the
context requires, terms relating to the Collateral or any part thereof, when
used in relation to a Grantor, shall refer to such Grantor’s Collateral or the
relevant part thereof.

 

SECTION 2.           GUARANTEE

 

2.1.          Guarantee. (a) Each of the
Guarantors hereby, jointly and severally, unconditionally and irrevocably,
guarantees to the Administrative Agent, for the ratable benefit of the Secured
Parties and their respective successors and permitted indorsees, transferees
and assigns, the prompt and complete payment and performance by the Borrower
when due (whether at the stated maturity, by acceleration or otherwise) of the
Borrower Obligations.

 

(b) Anything
herein or in any other Financing Document to the contrary notwithstanding, the
maximum liability of each Guarantor hereunder and under the other Financing
Documents shall in no event exceed the amount which can be guaranteed by such
Guarantor under applicable federal and state laws relating to the insolvency of
debtors (after giving effect to the right of contribution established in
Section 2.2).

 

(c) Each
Guarantor agrees that the Borrower Obligations may at any time and from time to
time exceed the amount of the liability of such Guarantor hereunder without
impairing the guarantee contained in this Section 2 or affecting the
rights and remedies of the Administrative Agent or any other Secured Party
hereunder.

 

(d) The
guarantee contained in this Section 2 shall remain in full force and
effect until all the Obligations (other than contingent indemnification and
contingent expense reimbursement obligations) shall have been satisfied by
payment in full.

 

(e) Except as
provided in Section 8.15, no payment made by any Borrower, any of the
Guarantors, any other guarantor or any other Person or received or collected by
the Administrative Agent 

 

5

 

or any other Secured Party from
any Borrower, any of the Guarantors, any other guarantor or any other Person by
virtue of any action or proceeding or any setoff, appropriation or application
at any time or from time to time in reduction of or in payment of the Borrower
Obligations shall be deemed to modify, reduce, release or otherwise affect the
liability of any Guarantor hereunder which shall, notwithstanding any such
payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or any payment received or collected from such Guarantor
in respect of the Borrower Obligations), remain liable for the Borrower
Obligations up to the maximum liability of such Guarantor hereunder until the
Borrower Obligations are paid in full.

 

2.2.          Right of Contribution. Each
Subsidiary Guarantor hereby agrees that to the extent that a Subsidiary
Guarantor shall have paid more than its proportionate share of any payment made
hereunder, such Subsidiary Guarantor shall be entitled to seek and receive
contribution from and against any other Subsidiary Guarantor hereunder which
has not paid its proportionate share of such payment. Each Subsidiary
Guarantor’s right of contribution shall be subject to the terms and conditions
of Section 2.3. The provisions of this Section 2.2 shall in no respect
limit the obligations and liabilities of any Subsidiary Guarantor to the
Administrative Agent and the other Secured Parties, and each Subsidiary
Guarantor shall remain liable to the Administrative Agent and the other Secured
Parties for the full amount guaranteed by such Subsidiary Guarantor hereunder.

 

2.3.          No Subrogation. Notwithstanding
any payment made by any Guarantor hereunder or any setoff or application of
funds of any Guarantor by the Administrative Agent or any other Secured
Parties, no Guarantor shall be entitled to be subrogated to any of the rights
of Administrative Agent or any other Secured Party against any Borrower or any
other Guarantor or any collateral security, guarantee or right of offset held
by the Administrative Agent or any other Secured Party for the payment of the
Borrower Obligations, nor shall any Guarantor seek any contribution or
reimbursement from any Borrower or any other Guarantor in respect of payments
made by such Guarantor hereunder, until all amounts owing to the Administrative
Agent and the other Secured Parties by the Borrower on account of the Borrower
Obligations are paid in full. If any amount shall be paid to any Guarantor on
account of such subrogation rights at any time when all of the Borrower
Obligations shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Guarantor, and shall, forthwith upon
receipt by such Guarantor, be turned over to the Administrative Agent in the
exact form received by such Guarantor (duly indorsed by such Guarantor to the
Administrative Agent, if required), to be applied against the Borrower
Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine in coordination with the Trustee if Exchange Notes are
outstanding. For the avoidance of doubt, nothing in the foregoing shall operate
as a waiver of any subrogation rights.

 

2.4.          Amendments, etc., with respect to
the Borrower Obligations. To the fullest extent permitted by applicable
law, each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to
or further assent by any Guarantor, any demand for payment of any of the
Borrower Obligations made by the Administrative Agent or any other Secured
Party may be rescinded by the Administrative Agent or such Secured Party and
any of the Borrower Obligations continued, and the Borrower Obligations, or the
liability of any other Person upon them or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waiver, surrendered or released by
the Administrative Agent or any other Secured Party, and the Term Loan
Agreement and the other Financing Documents and any other documents executed
and delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) and, if Exchange Notes are
outstanding, as the Trustee (or the required Holders of Exchange Notes in an
aggregate principal amount of more than 50% of the aggregate principal amount
of 

 

6

 

all the outstanding Exchange
Notes) may reasonably deem advisable from time to time, and any collateral
security, guarantee or right of offset at any time held by the Administrative
Agent or any other Secured Party for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released. Neither
the Administrative Agent nor any other Secured Party shall have any obligation
to protect, secure, perfect or insure any Lien at any time held by it as
security for the Borrower Obligations or for the guarantee contained in this
Section 2 or any property subject thereto.

 

2.5.          Guarantee Absolute and
Unconditional. To the fullest extent permitted by applicable law, each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Borrower Obligations and notice of or proof of reliance
by the Administrative Agent or any other Secured Party upon the guarantee
contained in this Section 2 or acceptance of the guarantee contained in
this Section 2; the Borrower Obligations, and any of them, shall conclusively
be deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon the guarantee contained in this
Section 2; and all dealings between any Borrower and any of the
Guarantors, on the one hand, and the Administrative Agent and the other Secured
Parties, on the other hand, likewise shall be conclusively presumed to have
been had or consummated in reliance upon the guarantee contained in this
Section 2. To the fullest extent permitted by applicable law, each Guarantor
waives diligence, presentment, protest, demand for payment and notice of
default or nonpayment to or upon any Borrower or any of the Guarantors with
respect to the Borrower Obligations. Each Guarantor understands and agrees that
the guarantee contained in this Section 2, to the fullest extent permitted
by applicable law, shall be construed as a continuing, absolute and
unconditional guarantee of payment without regard to (a) the validity or
enforceability of the Term Loan Agreement or any other Financing Document, any
of the Borrower Obligations or any other collateral security therefor or
guarantee or right of offset with respect thereto at any time or from time to time
held by the Administrative Agent or any other Secured Party, (b) any
defense, setoff or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by any
Borrower or any other Person against the Administrative Agent or any other
Secured Party or (c) any other circumstance whatsoever (with or without
notice to or knowledge of any Borrower or such Guarantor) which constitutes, or
might be construed to constitute, an equitable or legal discharge of any
Borrower for the Borrower Obligations, or of such Guarantor under the guarantee
contained in this Section 2, in bankruptcy or in any other instance. When
making any demand hereunder or otherwise pursuing its rights and remedies
hereunder against any Guarantor, the Administrative Agent or any other Secured
Party may, but shall be under no obligation to, make a similar demand on or
otherwise pursue such rights and remedies as it may have against any Borrower,
any other Guarantor or any other Person or against any collateral security or
guarantee for the Borrower Obligations or any right of offset with respect
thereto, and any failure by the Administrative Agent or any other Secured Party
to make any such demand, to pursue such other rights or remedies or to collect
any payments from any Borrower, any other Guarantor or any other Person or to
realize upon any such collateral security or guarantee or to exercise any such right
of offset, or any release of any Borrower, any other Guarantor or any other
Person or any such collateral security, guarantee or right of offset, shall not
relieve any Guarantor of any obligation or liability hereunder, and shall not
impair or affect the rights and remedies, whether express, implied or available
as a matter of law, of the Administrative Agent or any other Secured Party
against any Guarantor. For the purpose hereof “demand” shall include the
commencement and continuance of any legal proceedings.

 

2.6.          Reinstatement. The guarantee
contained in this Section 2 shall continue to be effective, or be reinstated,
as the case may be, if at any time payment, or any part thereof, of any of the
Borrower Obligations is rescinded or must otherwise be restored or returned by
the Administrative Agent or any other Secured Party upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of any Borrower or any
Guarantor, or upon or as a result of the appointment of a receiver, intervenor
or conservator of, or trustee or similar officer for, any Borrower or any
Guarantor or any substantial part of its property, or otherwise, all as though
such payments had not bee made.

 

7

 

2.7.          Payments. Each Guarantor hereby
guarantees that payments hereunder will be paid to the Administrative Agent
without setoff or counterclaim in Dollars at the Administrative Agent’s Office.

 

SECTION 3.           GRANT OF SECURITY INTEREST

 

Each Grantor
hereby assigns and transfers to the Administrative Agent, and hereby grants to
the Administrative Agent, for the ratable benefit of the Secured Parties, a
security interest in, all of the following property now owned or at any time
hereafter acquired by such Grantor or in which such Grantor now has or at any
time in the future may acquire any right, title or interest other than Excluded
Property (collectively, the “Collateral”), as collateral security for
the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of such Grantor’s Obligations:

 

(a)  all
Accounts;

 

(b)  all
Chattel Paper;

 

(c)  all
Deposit Accounts, Securities Accounts and Commodity Accounts;

 

(d)  all
Documents;

 

(e)  all
Equipment;

 

(f)  all
Fixtures;

 

(g)  all
General Intangibles;

 

(h)  all
Instruments;

 

(i)  all
Intellectual Property;

 

(j)  all
Inventory;

 

(k)  all
Investment Property;

 

(l)  all
Letter of Credit Rights;

 

(m)  all
Commercial Tort Claims with respect to the matters described on Schedule 7;

 

(n)  all
other personal property not otherwise described above;

 

(o)  all
books and records pertaining to the Collateral; and

 

(p)  to
the extent not otherwise included, all Proceeds, Supporting Obligations and
products of any and all of the foregoing and all collateral security and
guarantees given by any Person with respect to any of the foregoing;

 

provided, however,
that notwithstanding any of the other provisions set forth in this Section 3,
the term Collateral and the terms set forth in this Section defining the
components of Collateral shall not include, and this Agreement shall not
constitute a grant of a security interest in, any of the following (the “Excluded
Property”): (i) any property to the extent that such grant of a
security interest is prohibited by

 

8

 

any applicable Law of a Governmental Authority, requires a consent not
obtained of any Governmental Authority pursuant to such Law or is prohibited
by, or constitutes a breach or default under or results in the termination of
or gives rise to a right on the part of the parties thereto other than
Holdings, the Borrower and the Borrower’s Subsidiaries to terminate (or
materially modify) or requires any consent not obtained under any contract,
license, agreement, instrument or other document evidencing or giving rise to
such property or to a Lien on such property permitted to be incurred pursuant
to the Term Loan Agreement or, in the case of any Investment Property, Pledged
Equity or Pledged Debt, any applicable shareholder or similar agreement, except
to the extent that such Law or the term in such contract, license, agreement,
instrument or other document or shareholder or similar agreement providing for
such prohibition, breach, default or right of termination or modification or
requiring such consent is ineffective under applicable law, (ii) any
property owned by any Grantor on the date hereof or hereafter acquired that is
subject to a Lien securing a purchase money or capital or finance lease
obligation permitted to be incurred pursuant to the Term Loan Agreement if the
contract or other agreement in which such Lien is granted (or the documentation
providing for such purchase money, project financing or capital or finance
lease obligation) prohibits the creation of any other Lien on such property,
(iii) any trucks, trailers, tractors, service vehicles, automobiles,
rolling stock or other registered mobile equipment or equipment covered by
certificates of title or ownership of any Grantor, (iv) Excluded Accounts,
(v) the Capital Stock of any joint venture in respect of which Holdings or
any of its Subsidiaries holds Capital Stock if (and only so long as), in any
case, the grant of any such security interest is prohibited by, or constitutes
a breach or default under or results in the termination of or gives rise to a
right on the part of the parties thereto other than Holdings, the Borrower and
the Borrower’s Subsidiaries to terminate (or materially modify) or requires any
consent not obtained under any contract, license, agreement, instrument or
other document evidencing or giving rise to such property or any applicable
shareholder, joint venture of similar agreement, (vi) FAA Collateral and
(vii) Excluded Case; provided, however, that Excluded
Property shall not include any Proceeds, substitutions or replacements of any
Excluded Property referred to above and such Proceeds shall not constitute
“Excluded Property” (unless such Proceeds, substitutions or replacements would
constitute Excluded Property referred to above). If an Event of Default shall
have occurred and be continuing, each Grantor shall, if requested to do so by
the Administrative Agent, use commercially reasonable efforts to obtain any
required consent that is reasonably obtainable with respect to Collateral which
the Administrative Agent reasonably determines to be material.

 

In addition, any Collateral
consisting of Capital Stock or other securities of a Subsidiary shall be deemed
to constitute Excluded Property to the extent that the pledge of such Capital
Stock or other securities results in the Company or Holdings being required to
file separate financial statements of such Subsidiary with the SEC, but only to
the extent necessary to not be subject to such requirement and only for so long
as such requirement is in existence. In addition, in the event that
Rule 3-16 of Regulation S-X under the Securities Act is amended, modified
or interpreted by the SEC to require (or is replaced with another rule or
regulation or another law, rule or regulation is adopted which would
require) the filing with the SEC (or another governmental agency) of separate
financial statements of any Subsidiary of the Company due to the fact that the
Subsidiary’s Capital Stock or other securities secure any Obligations, then the
Capital Stock or other securities of such Subsidiary will automatically be
deemed Excluded Property, but only to the extent necessary to not be subject to
such requirement and only for so long as is required to not be subject to such
requirement. In such event, this Agreement may be amended or modified, without
the consent of any Secured Party, to the extent necessary to release the
security interests in the shares of Capital Stock or other securities that are
so deemed to constitute Excluded Property. In the event that Rule 3-16 of
Regulation S-X under the Securities Act is amended, modified or interpreted by
the SEC to permit (or is replaced with another rule or regulation, or any
other law, rule or regulation is adopted which would permit) such
Subsidiary’s Capital Stock or other securities to secure the Obligations in
excess of the amount then pledged without the filing with the SEC (or any other
governmental agency) of separate financial statements of such Subsidiary, then
the Capital Stock or other securities of such Subsidiary will

 

9

 

automatically be deemed to no
longer constitute Excluded Property but only to the extent necessary to not be
subject to any such financial statement requirement.

 

SECTION 4.           REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative Agent and the Lenders
to enter into the Term Loan Agreement and to induce the Lenders to make their
respective loans to the Borrower thereunder, each Grantor hereby represents and
warrants to the Administrative Agent and each other Secured Party that:

 

4.1           Title;
No Other Liens.  Except for security interest granted to the
Administrative Agent for the ratable benefit of the Secured Parties pursuant to
this Agreement and the other Liens permitted to exist on the Collateral by the
Term Loan Agreement, such Grantor owns each item of the Collateral free and
clear of any and all Liens. No effective financing statement or other public
notice with respect to all or any part of the Collateral is on file or of
record in ay public office, except such as have been filed in favor of the
Administrative Agent, for the ratable benefit of the Secured Parties, pursuant
to this Agreement or as are permitted by the Term Loan Agreement or as to which
documentation to terminate the same shall have been delivered to the
Administrative Agent. For the avoidance of doubt, it is understood and agreed
that any Grantor may, as part of its business, grant licenses to third parties
to use Intellectual Property owned or developed by a Grantor. For purpose of
this Agreement and the other Financing Documents, such licensing activity shall
not constitute a “Lien” on such Intellectual Property. Each of the Administrative
Agent and each other Secured Party understands that any such licenses may be
exclusive to the applicable licenses, and such exclusivity provisions may limit
the ability of the Administrative Agent to utilize, sell, lease or transfer the
related Intellectual Property or otherwise realize value from such Intellectual
Property pursuant hereto.

 

4.2           Perfected
First Priority Liens.  The security interests granted pursuant to
this Agreement (i) upon completion of the fillings and other actions specified
on Schedule 3 (x) will constitute valid perfected security
interests in all of the Collateral (other than Intellectual Property) in favor
of the Administrative Agent, for the ratable benefit of the Secured Parties, as
collateral security for such Grantor’s Obligations, enforceable in accordance
with the terms hereof against all creditors of such Grantor and any Persons
purporting to purchase any Collateral from such Grantor, to the extent a
security interest therein may be perfected by filing, recording or registration
in the United States pursuant to the New York UCC, (y) will constitute
valid perfected security interests in all of the Collateral constituting of
Intellectual Property in favor of the Administrative Agent, for the ratable
benefit of the Secured Parties, as collateral security for such Grantor’s
Obligations, enforceable in accordance with the terms hereof against all
creditors of such Grantor and any Persons, purporting to purchase any
Collateral from such Grantor, to the extent a security interest therein may be
perfected by filings to be made in the United States Patent and Trademark
Office and the United States Copyright Office, and (z) will constitute
valid perfected security interests in each Collateral Deposit Account in favor
of the Administrative Agent, for the ratable benefit of the Secured Parties, as
collateral security for such Grantor’s Obligations, enforceable in accordance
with the terms hereof upon the Administrative Agent obtaining “control” of such
Collateral Deposit Account for purposes of the New York UCC, and (ii) are
prior to all other Liens on the Collateral in existence on the date hereof
except for Liens permitted by the Term Loan Agreement which have priority over
the Liens on the Collateral by operation of law (including the priority rues
under the New York UCC) or which, in the case of Collateral consisting of
Pledged Equity and Pledged Debt, are nonconsensual Liens permitted pursuant to
the Term Loan Agreement to be prior to the security interests granted pursuant to
this Agreement or which, in the case of Collateral other than Pledged Equity
and Pledged Debt, are permitted pursuant to the Term Loan Agreement to be prior
to the security interests granted pursuant to this Agreement.

 

10

 

4.3           Jurisdiction
of Organization. On the date hereof, such Grantor’s jurisdiction of
organization and identification number from the jurisdiction of organization
(if any) are specified on Schedule 4. Such Grantor has furnished to the
Administrative Agent a certified charter, certificate of incorporation or other
organization document and long-form good standing certificate as of a date
which is recent to the date hereof.

 

4.4           Inventory
and Equipment. On the date hereof, the Inventory and the Equipment of each
Grantor (other than aircraft and Inventory and Equipment on any aircraft) are
kept at the locations listed on Schedule 5. The provisions of the
Section 4.4 shall not apply to Equipment or Inventory in transit, that has
been sold (including sales on consignment or approval in the ordinary course of business), that is
out for repair, that is at other locations for purposes of onsite maintenance
or repair, or that is at airports to permit onsite maintenance or repair of
aircraft or aircraft engines, or to Equipment and Inventory at location with
less than $2,000,000 in aggregate value.

 

4.5.          Farm
Products. None of the Collateral constitutes, or is the Proceeds of, Farm Products.

 

4.6           Investment
Property. (a) On the date hereof, the shares of Pledged Equity pledged
by such Grantor hereunder constitute all the issued and outstanding shares of
all classes of the Capital Stock of each Subsidiary owned by such Grantor or,
in the case of Subsidiaries that are Foreign Subsidiaries or Domestic Subsidiaries
substantially all of whose assets consist of voting Capital Stock of one or
more Foreign Subsidiaries, the shares of such Issuers pledged by the such Grantor constitute 65% of the
outstanding Foreign Subsidiary Voting Stock of each such Issuer (Or, if such
Grantor owns less than 65% of the outstanding Foreign Subsidiary Voting Stock
of any such Issuer, constitute all the Foreign subsidiary Voting Stock of such
Issuer owned by such Grantor).

 

(b) All the shares of the Pledged Equity as to which the Borrower or a Subsidiary of the Borrower
is the Issuer have been duly and validly issued and are fully paid and
nonassessable.

 

(c) To the best of such Grantor’s knowledge,
each of the Pledged Debt constitutes the legal, valid and binding obligation of
the obligor with respect thereto, enforceable in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors’ rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing.

 

(d) Such Grantor is the beneficial owner of,
and has good and
marketable title to, the Investment Property pledged by it hereunder, free of
any and all Liens or options in favor of any other Person, except the security
interest created by this Agreement or nonconsensual Liens permitted pursuant to
the Term Loan Agreement.

 

4.7           Receivables.
No amount payable to such
Grantor under or in connection with any Receivable of an amount greater that
$2,000,000 is evidenced by any Instrument or Chattel Paper which has not been
delivered to the Administrative Agent.

 

4.8           Intellectual
Property. Schedule 6 lists all Intellectual Property (other than Copyright Licenses and
Trademark Licenses) that is registered in the United States or for which
application for registration in the United States has been filed and that is
material to the operation of the business of the Borrower and its Subsidiaries
taken as a whole owned by such Grantor in its own name on the date hereof. Such
Intellectual Property is valid and enforceable, the use thereof does not
infringe, misappropriate or otherwise violate the Intellectual Property rights
of any third party and, to the

 

11

 

knowledge
of such Grantor, as of the date hereof, no third party has or is infringing,
misappropriating or otherwise violating Grantor’s rights in and to such
Intellectual Property, except to the extent that the invalidity or
unenforceability of such Intellectual Property or such infringement,
misappropriation or violation could not reasonably be expected to have a
Material Adverse Effect.

 

4.9           Commercial
Tort Claims. On the
date hereof, except to the extent listed in Section 3 above, no Grantor
has knowledge of rights in any Commercial Tort Claim as to which it reasonably
expects to recover more than $2,000,000.

 

4.10.        Deposit
Accounts, Etc. All of such Grantor’s Deposit Accounts, Securities Accounts and Commodity Accounts (other
than Excluded Accounts) as of the date hereof are listed on Schedule 8.

 

SECTION 5.           COVENANTS

 

Each Grantor covenants and agrees with the
Administrative Agent and the other Secured Parties that, from and after the
date of this Agreement until the Obligations (other than contingent indemnification and contingent expense reimbursement
obligations) shall have been paid in full:

 

5.1           Delivery
of Instruments, Certificated Securities and Chattel Paper. (a) If
(i) any amount in excess of $2,000,000 owned by any Subsidiary of the
Borrower to any Grantor or (ii) any other amount in excess of $2,000,000
payable under or in connection with any of the Collateral shall be or become
evidenced by any Instrument, Certificated Security or Chattel Paper, such
Instrument, Certificated Security or Chattel Paper shall be delivered as soon
as reasonably practicable to the Administrative Agent, duly indorsed in a
manner reasonably satisfactory to the Administrative Agent, to be held as Collateral
pursuant to this Agreement.

 

(b) Any Pledged Debt required to be
subordinated pursuant to
the Term Loan Agreement shall, in each case, be fully subordinated to the
payment in full of the Obligations.

 

5.2           Maintenance
of Insurance. (a) Such Grantor will maintain the insurance required by the Term Loan Agreement.

 

(b) All such insurance shall (i) provide
that no cancellation, material reduction in amount or material change in
coverage thereof shall be effective until at least 30 days or, in the case of insurance existing as of the date hereof,
at least 10 days after receipt by the Administrative Agent of written notice
thereof and (ii) name the Administrative Agent as insured party or loss
payee.

 

5.3           Maintenance
of Perfected Security Interest; Further Documentation. (a) Such
Grantor shall take all actions reasonably requested by the Administrative Agent
to maintain the security interest created by this Agreement as a security
interest having at least the perfection and priority described in Section 4.2 and shall take all
commercially reasonable actions to defend such security interest against the
claims and demands of all Persons whomsoever, subject in each case to, in the
case of Collateral consisting of Pledged Equity and Pledged Debt, nonconsensual
Liens permitted by the Term Loan Agreement and, in the case of Collateral other
than Pledged Equity and Pledged Debt, Liens permitted by the Term Loan
Agreement and to the rights of such Grantor under the Financing Documents to
dispose of the Collateral.

 

(b) Such Grantor will furnish to the Administrative Agent from time to time statements and
schedules further identifying and describing the assets and property of such
Grantor and such other reports in connection therewith as the Administrative
Agent may reasonably request, all in reasonable

 

12

 

detail.
Each year, at the time of delivery of annual financial statements with respect
to the preceding fiscal year pursuant to the Term Loan Agreement, the Borrower
shall deliver to the Administrative Agent a certificate executed by the
associate general counsel or the chief legal officer of the Borrower setting
forth, as of the date of such certificate, the information required pursuant to
Schedules 2, 4, 6, 7 and 8 hereto and Schedules 1.1B, 1.1C, 3.15,
3.21(a) and 3.21(b) to the Term Loan Agreement or confirming that
there has been no change in such information since (i) such information
was furnished or otherwise updated, amended, changed or supplemented, or (ii) the
date of the most recent certificate delivered pursuant to this Section 5.3(b).

 

(c)  At
any time and from time to time, upon the written request of the Administrative
Agent, and at the sole expense of such Grantor, such Grantor will promptly and
duly execute and deliver, and have recorded, such further instruments and
documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full benefits
of this Agreement and of the rights and powers herein granted, including,
without limitation, (i) filing any financing or continuation statements
under the Uniform Commercial Code (or other similar laws) in effect in any
jurisdiction with respect to the security interests created hereby and (ii) in
the case of Investment Property not issued by the Borrower or its Subsidiaries,
Deposit Accounts, Securities Accounts, Commodity Accounts, Letter of Credit
Rights and any other relevant Collateral, using commercially reasonable efforts
to take, at any time after the occurrence and during the continuation of an
Event of Default, any actions necessary to enable the Administrative Agent to
obtain “control” (within the meaning of the applicable Uniform Commercial Code)
with respect thereto.

 

5.4.          Changes in Locations, Name, etc.
Such Grantor will not, except upon 10 days’ prior written notice to the
Administrative Agent (or such shorter notice as shall be reasonably
satisfactory to the Administrative Agent) and delivery to the Administrative
Agent of all additional executed financing statements and other documents
reasonably requested by the Administrative Agent to maintain the validity,
perfection and priority of the security interests provided for herein, (i) change
its jurisdiction of organization from that referred to in Section 4.3 or (ii) change
its name.

 

5.5.          Notices. Such Grantor will
advise the Administrative Agent promptly, in reasonable detail, of:

 

(a)  any Lien (other than security interests created hereby
or Liens permitted under the Term Loan Agreement) on any of the Collateral
which would adversely affect the ability of the Administrative Agent to
exercise any of its remedies hereunder; and

 

(b)  the occurrence of any other event which could reasonably
be expected to have a material adverse effect on the aggregate value of the
Collateral or on the security interests created hereby.

 

5.6.          Investment Property. (a) If
such Grantor shall become entitled to receive or shall receive any certificate
(including, without limitation, any certificate representing a dividend or a
distribution in connection with any reclassification, increase or reduction of
capital or any certificate issued in connection with any reorganization),
option or rights in respect of the Capital Stock of any Subsidiary, whether in
addition to, in substitution of, as a conversion of, or in exchange for, any
shares of the Pledged Equity, or otherwise in respect thereof, such Grantor
shall accept the same as the agent of the Administrative Agent and the other
Secured Parties, hold the same in trust for the Administrative Agent and the
other Secured Parties and deliver the same forthwith to the Administrative
Agent in the exact form received, duly indorsed by such Grantor to the
Administrative Agent, if required, together with an undated stock power
covering such certificate duly executed in blank by such Grantor, to be held by
the Administrative Agent, subject to the terms hereof, as additional collateral
security for the Obligations. If

 

13

 

an Event of Default shall have occurred and
be continuing, and any distribution of capital to a Grantor (other than cash)
required to be included in Collateral shall be made on or in respect of the
Investment Property or any property (other than cash) required to be included
in Collateral shall be distributed to a Grantor upon or with respect to the
Investment Property pursuant to the recapitalization or reclassification of the
capital of any Issuer or pursuant to the reorganization thereof, such Grantor
shall, unless such distribution of capital or property is otherwise subject to a
perfected security interest in favor of the Administrative Agent, use
commercially reasonable efforts to cause it to be subject to a perfected
security interest in favor of the Administrative Agent to the extent and in the
manner required pursuant to Section 5.3 hereof. If any such property so
distributed in respect of the Investment Property shall be received by such
Grantor, such Grantor shall, until such property is delivered to the
Administrative Agent, hold such property in trust for the Administrative Agent
and the other Secured Parties as additional collateral security for the
Obligations.

 

(b)  Without
the prior written consent of the Administrative Agent, such consent not to be
unreasonably withheld, such Grantor will not (i) sell, assign, transfer,
exchange, or otherwise dispose of, or grant any option with respect to, the
Investment Property or Proceeds thereof (except pursuant to a transaction
permitted by the Term Loan Agreement), (ii) create, incur or permit to
exist any Lien or option in favor of, or any claim of any Person with respect
to, any of the Investment Property or Proceeds thereof, or any interest
therein, except for the security interests created by this Agreement or
permitted under the Term Loan Agreement or (iii) except as permitted by the
Term Loan Agreement, enter, subsequent to the date upon which such Investment
Property becomes collateral hereunder, into any agreement (other than the Term
Loan Agreement) or undertaking restricting the right or ability of such Grantor
or the Administrative Agent to sell, assign or transfer any of the Investment
Property required to be included in Collateral or proceeds thereof.

 

(c)  In
the case of each Grantor which is an Issuer, such Issuer agrees that (i) it
will be bound by the terms of this Agreement relating to the Investment
Property required to be included in Collateral issued by it and will comply
with such terms insofar as such terms are applicable to it, (ii) it will
notify the Administrative Agent promptly in writing of the occurrence of any of
the events described in Section 5.6(a) with respect to such
Investment Property issued by it and (iii) the terms of Sections 6.3(c) and
6.7 shall apply to it, mutatis  mutandis, with respect to all
actions that may be required of it pursuant to Section 6.3(c) and 6.7
with respect to such Investment Property issued by it.

 

(d)  No
Grantor shall permit any security interest in certificated Pledged Equity of
any Issuer that is not a Subsidiary to be perfected by possession in favor of a
Person other than the Administrative Agent.

 

5.7.          Receivables. (a) Other
than in the ordinary course of business, such Grantor will not (i) grant
any extension of the time of payment of any Receivable required to be included
in Collateral, (ii) compromise or settle any Receivable required to be
included in Collateral for less than the full amount thereof, (iii) release,
wholly or partially, any Person liable for the payment of any Receivable
required to be included in Collateral, (iv) allow any credit or discount
whatsoever on any Receivable required to be included in Collateral or (v) amend,
supplement or modify any Receivable required to be included in Collateral in
any manner that could adversely affect the value thereof.

 

(b)  Such
Grantor will deliver to the Administrative Agent a copy of each material
demand, notice or document received by it that questions or calls into doubt
the validity or enforceability of more than 20% of the aggregate amount of the
then-outstanding Receivables.

 

14

 

(c)  Notwithstanding
anything herein or in any other Financing Document to the contrary, such
Grantor shall not be required to comply with the requirements of the Federal
Assignment of Claims Act of 1940.

 

5.8.          Intellectual Property. (a) Such
Grantor (either itself or through licensees) will (i) continue to use each
Trademark that is material to the operation of the business of the Borrower and
its Subsidiaries taken as a whole on each and every trademark class of goods
applicable to its current line as reflected in its current catalogs, brochures
and price lists in order to maintain such Trademark in full force free from any
claim of abandonment for non-use, (ii) maintain as in the past the quality
of products and services offered under such Trademark, (iii) use such
Trademark with the appropriate notice of registration and all other notices and
legends required by applicable Law, (iv) not adopt or use any mark which
is confusingly similar or a colorable imitation of such Trademark unless the
Administrative Agent, for the ratable benefit of the Secured Parties, shall
obtain a perfected security interest in such mark pursuant to this Agreement
and (v) not (and not permit any licensee or sublicensee thereof to) do any
act or knowingly omit to do any act whereby such Trademark may become
invalidated or impaired in any material respect.

 

(b)  Such
Grantor (either itself or through licensees) will not do any act, or omit to do
any act, whereby any Patent that is material to the operation of the business
of the Borrower and its Subsidiaries taken as a whole may become forfeited
abandoned or dedicated to the public.

 

(c)  Such
Grantor (either itself or through licensees) (i) will employ each
Copyright that is material to the operation of the business of the Borrower and
its Subsidiaries taken as a whole and (ii) will not (and will not permit
any licensee or sublicensee thereof to) do any act or knowingly omit to do any
act whereby any portion of the Copyrights that is material to the operation of
the business of the Borrower and its Subsidiaries taken as a whole may become
invalidated or otherwise impaired. Such Grantor will not (either itself or
through licensees) do any act whereby any portion of the Copyrights that is
material to the operation of the business of the Borrower and its Subsidiaries
taken as a whole may fall into the public domain.

 

(d)  Such
Grantor (either itself or through licensees) will not do any act that knowingly
uses any Intellectual Property that is material to the operation of the
business of the Borrower and its Subsidiaries taken as a whole to infringe the
intellectual property rights of any other Person.

 

(e)  Such
Grantor will notify the Administrative Agent immediately if it knows, or has
reason to know, that any application or registration relating to any
Intellectual Property that is material to the operation of the business of the
Borrower and its Subsidiaries taken as a whole may become forfeited, abandoned
or dedicated to the public, or of any adverse determination or development
(including, without limitation, the institution of, or any such determination
or development in, any proceeding in the United States Patent and Trademark
Office, the United States Copyright Office or any court or tribunal in any
country) regarding such Grantor’s ownership of, or the validity of, any such
Intellectual Property or such Grantor’s right to register the same or to own
and maintain the same.

 

(f)  In
the event such Grantor, either by itself or through any agent, employee,
licensee or designee, shall in any fiscal year file an application for the
registration of any Intellectual Property that is material to the operation of
the Borrower and its Subsidiaries taken as a whole with the United States
Patent and Trademark Office, the United States Copyright Office or any
political subdivision thereof, such Grantor shall report such filing to the
Administrative Agent at the time of delivery of annual financial statements
with respect to such fiscal year pursuant to the Term Loan Agreement. Upon
reasonable request of the Administrative Agent, such Grantor shall execute and
deliver, and have recorded, any and all agreements, instruments, documents,

 

15

 

and
papers as the Administrative Agent may reasonably request to evidence the
Administrative Agent’s and the other Secured Parties’ security interest in any
such Copyright, Patent to Trademark and the goodwill and general intangibles of
such Grantor relating thereto or represented thereby.

 

(g)  Such
Grantor will take all reasonable and necessary steps, including, without
limitation, in any proceeding before the United States Patent and Trademark
Office, the United States Copyright Office or any similar office or agency in
any other county or any political subdivision thereof, to maintain and pursue
each application (and to obtain the relevant registration) and to maintain each
registration of the Intellectual Property that is material to the operation of
the business of the Borrower and its Subsidiaries taken as a whole, including
without limitation, filing of applications for renewal, affidavits of use and
affidavits of incontestability.

 

(h)  In
the event that any Intellectual Property that is material to the operation of
the business of the Borrower and its Subsidiaries taken as a whole is
infringed, misappropriated or diluted by a third party, such Grantor shall (i) take
such actions as such Grantor shall reasonably deem appropriate under the
circumstance to protect such Intellectual Property and (ii) if such
Intellectual Property is of material economic value, promptly notify the
Administrative Agent after it learns thereof and sue for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and
to recover any and all damages for such infringement, misappropriation or
dilution.

 

(i)  Notwithstanding
anything to the contrary in this Agreement, subject to the provisions of the
Term Loan Agreement, nothing shall prevent any Grantor in the ordinary course
of business from abandoning, ceasing to use or otherwise impairing or disposing
of any Intellectual property if such Grantor reasonably believes that doing so
is in its business interest. For the avoidance of doubt, nothing in this Section 5.8
shall prohibit a sale, transfer or disposition of any Intellectual Property
made in accordance with Sections 6.4 or 6.9 of the Term Loan Agreement.

 

(j)  No
Grantor shall, and the Grantors in the aggregate shall not, make filings in the
United States Copyright Office or the United States Trademark Office to perfect
any security interest in all or substantially all of the Copyright Licenses
held by the Grantors in the aggregate or all or substantially all of the
Trademark Licenses held by the Grantors in the aggregate (other than to perfect
the security interest in such Copyright Licenses and Trademark Licenses
securing the Obligations).

 

(k)  Upon
and during the continuance of an Event of Default, each Grantor shall use all
commercially reasonable efforts to obtain all requisite consents or approvals
under such Copyright License, Patent License and Trademark License reasonably
requested by the Administrative Agent to effect the assignment of all such
Grantor’s right, title and interest thereunder to the Administrative Agent or
its designee.

 

5.9.          Commercial Tort Claims.  If
such Grantor shall obtain an interest in any Commercial Tort Claim as to which
it determines that it reasonably expects to recover more than $2,000,000, such
Grantor shall within 30 days of making such determination (or such other period
reasonably satisfactory to the Administrative Agent) sign and deliver
documentation reasonably acceptable to the Administrative Agent granting a
security interest under the terms and provisions of this Agreement in and to
such Commercial Tort Claim.

 

5.10.        Deposit Accounts.  (a) Each
Grantor shall execute and deliver to the Administrative Agent Deposit Account
Control Agreements for each Collateral Deposit Account identified on
Schedule 8 within 60 days after the Closing Date, or such longer period as
is reasonably acceptable to the Administrative Agent.

 

16

 

(b)  Before
opening, closing or replacing any Collateral Deposit Account, each Grantor
shall give 5 Business Days’ prior notice to the Administrative Agent and, if
requested by the Administrative Agent, shall cause each bank of financial
institution in which it seeks to open a Collateral Deposit Account, to enter
into a Deposit Account Control Agreement with the Administrative Agent in order
to give the Administrative Agent control of such Deposit Account. In the case
of Collateral Deposit Accounts maintained with Lenders, the terms of such
letter shall be subject to the provisions of the Term Loan Agreement or this
Agreement regarding setoffs.

 

SECTION 6.           REMEDIAL
PROVISIONS

 

6.1.          Certain Matters Relating to
Receivables. (a) The Administrative Agent shall have the right
annually (or, if an Event of Default has occurred and is continuing, at any
time) to make test verifications of the Receivables required to be included in
Collateral in any manner and through any medium that it reasonably considers
advisable, and each Grantor shall furnish all such assistance and information
that it reasonably considers advisable, and each Grantor shall furnish all such
assistance and information as the Administrative Agent may require in
connection with such test verifications. Annually (or, if an Event of Default
has occurred and is continuing, at any time), upon the Administrative Agent’s
reasonable request and at the expense of the relevant Grantor, such Grantor
shall use commercially reasonable efforts to cause independent public
accountants or other satisfactory to the Administrative Agent to furnish to the
Administrative Agent reports showing reconciliations, aging and test
verifications of, and trial balances for, such Receivables.

 

(b)  The
Administrative Agent hereby authorizes each Grantor to collect such Grantor’s
Receivables required to be included in Collateral and the Administrative Agent
may curtail or terminate said authority at any time after the occurrence and
during the continuance of an Event of Default. If required by the
Administrative Agent at any time after the occurrence and during the
continuance of an Event of Default, any payments of such Receivables, when
collected by any Grantor, (i) shall be forthwith (and, in any event,
within two Business Days) deposited by such Grantor in the exact form received,
duly indorsed by such Grantor to the Administrative Agent if required, in a Collateral
Account maintained under the sole dominion and control of the Administrative
Agent if required, in a collateral Account maintained under the sole dominion
and control of the Administrative Agent, subject to withdrawal by the
Administrative Agent for the account of the other Secured Parties only as
provided in Section 6.5, and (ii) until so turned over, shall be held
by such Grantor in trust for the Administrative Agent and the other Secured
Parties, segregated from other funds of such Grantor. Each such deposit of
Proceeds of Receivables required to be included in Collateral shall be
accompanied by a report identifying in reasonable detail the nature and source
of the payments included in the deposit.

 

(c)  If
an Event of Default has occurred and is continuing, at the Administrative
Agent’s request, each Grantor shall deliver to the Administrative Agent all
original and other document evidencing, and relating to, the agreements and
transactions which gave rise to the Receivables required to be included in
Collateral, including, without limitation, all original orders, invoices and
shipping receipts.

 

6.2.          Communications with Obligors;
Grantors Remain Liable. (a) The Administrative Agent in its own name
or in the name of others may at any time when an Event of Default has occurred
and is continuing, communicate with obligors under the Receivables required to
be included in Collateral to verify with them to the Administrative Agent’s
satisfaction the existence, amount and terms of any such Receivables.

 

(b)  Upon
the request of the Administrative Agent at any time after the occurrence and
during the continuance of an Event of Default, each Grantor shall notify
obligors on the Receivables required to be included in Collateral that such
Receivables have been assigned to the Administrative

 

17

 

Agent
for the ratable benefit of the Secured Parties and that payments in respect
thereof shall be made directly to the Administrative Agent.

 

(c)  Anything
herein to the contrary notwithstanding, each Grantor shall remain liable under
each of the Receivables required to be included in Collateral to observe and
perform all the conditions and obligations to be observed and performed by it
thereunder, all in accordance with the terms of any agreement giving rise
thereto. Neither the Administrative Agent nor any other Secured Party shall
have any obligation or liability under any such Receivable (or any agreement
giving rise thereto) by reason of or arising out of this Agreement or the
receipt by the Administrative Agent or any other Secured Party be obligated in
any manner to perform any of the obligations of any Grantor under or pursuant
to any such Receivable (or any agreement giving rise thereto), to make any
payment, to make any inquiry as to the nature or the sufficiency of any payment
received by it or as to the sufficiency of any performance by any party
thereunder, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.

 

6.3.          Pledged Equity. (a) Unless
an Event of Default shall have occurred and be continuing and the
Administrative Agent shall have given notice to the relevant Grantor of the Administrative
Agent’s intent to exercise its corresponding rights pursuant to Section 6.3(b),
each Grantor shall be permitted to receive all dividends (other than dividends
payable in Capital Stock) Paid in respect of the Pledged Equity and all
payments made in respect of the Pledged Debt, in each case to the extent
permitted in the Term Loan Agreement, and to exercise all voting and corporate
or other organizational rights with respect to the Investment Property; provided,
however, that such Grantor will not be entitled to exercise any such
right if the result thereof could materially and adversely affect the right
inuring to a holder of the Investment Property or the right and remedies of the
Administrative Agent or the other Secured Parties under Financing Document or
the ability of the Administrative Agent or the other Secured Parties to
exercise the same.

 

(b)  If
an Event of Default shall occur and be continuing and the Administrative Agent
shall give notice of its intent to exercise such rights to the relevant Grantor
or Grantors, (i) the Administrative Agent shall have the right to receive
any and all cash dividends, payments (including sums paid upon the liquidation
or dissolution of any Issuer or in connection with any distribution of capital)
or other Proceeds paid in respect of the Investment Property and make
application thereof to the Obligations in accordance with the provisions of the
Term Loan Agreement and (ii) any or all of the Investment Property shall
be registered in the name of the Administrative Agent or its nominee, and the
Administrative Agent or its nominee may thereafter exercise (x) all
voting, corporate and other right pertaining to such Investment Property at any
meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y) any
and all rights of conversion, exchange and subscription and any other rights,
privileges or options pertaining to such Investment Property as if it were the
absolute owner thereof (including, without limitation, the right to exchange at
its discretion any and all of the Investment Property upon the merger,
consolidation, reorganization, recapitalization or other fundamental change in
the corporate or other organizational structure of any Issuer, or upon the
exercise by any Grantor or the Administrative Agent of any right, privilege or
option pertaining to such Investment Property, and in connection therewith, the
right to deposit and deliver any and all of the Investment Property with any
committee, depositary, transfer agent, registrar or other designated agency
upon such terms and conditions as the Administrative Agent may determine), all
without liability except to account for property actually received by it, but
the Administrative Agent shall have no duty to any Grantor to exercise any such
right, privilege or option and shall not be responsible for any failure to do
so or delay in so doing. If any sums of money paid or distributed in respect of
Investment Property, which the Administrative Agent shall be entitled to receive
pursuant to clause (i) above, shall be received by a

 

18

 

Grantor,
such Grantor shall, until such money is paid to the Administrative Agent, hold
such money in trust for the Administrative Agent and the other Secured Parties
as additional collateral for the Obligations.

 

(c)  Each
Grantor hereby authorizes and instructs each Issuer of any Investment Property
pledged by such Grantor hereunder to (i) comply with any instruction
received by it from the Administrative Agent in writing that (x) states
that an Event of Default has occurred and is continuing and (y) is
otherwise in accordance with the terms of this Agreement, without any other or
further instructions from such Grantor, and each Grantor agrees that each
Issuer shall be fully protected in so complying, and (ii) unless otherwise
expressly permitted hereby, pay any dividends or other payments with respect to
the Investment Property directly to the Administrative Agent.

 

6.4.          Proceeds to be Turned Over to
Administrative Agent. If an Event of Default occurs and is continuing and
the Administrative Agent so requests, all Proceeds received by any Grantor
consisting of cash, checks and other near-cash items shall be held by such
Grantor in trust for the Administrative Agent and the other Secured Parties,
segregated from other funds of such Grantor, and shall, forthwith upon receipt
by such Grantor, be turned over to the Administrative Agent in the exact form
received by such Grantor (duly indorsed by such Grantor to the Administrative
Agent, if required). All Proceeds received by the Administrative Agent
hereunder shall be held by the Administrative Agent in a Collateral Account
maintained under its sole dominion and control. All Proceeds while held by the
Administrative Agent in a Collateral Account (or by such Grantor in trust for
the Administrative Agent and the other Secured Parties) shall continue to be
held as collateral security for all the Obligations and shall not constitute
payment thereof until applied as provided in Section 6.5.

 

6.5.          Application of Proceeds. At
such intervals as may be agreed upon by the Borrower and the Administrative
Agent, or, if an Event of Default has occurred and is continuing, at any time
at the Administrative Agent’s election, the Administrative Agent shall apply
all or any part of Proceeds required to be included in Collateral, whether or
not held in any Collateral Account, and any proceeds of the guarantee set forth
in Section 2, in payment of the Obligations in the following order:

 

First, to pay Obligations in respect of incurred and
unpaid fees and expenses of the Administrative Agent and the Trustee (if any)
under the Financing Documents;

 

Second, towards payment of amounts then due and owing and
remaining unpaid in respect of the Obligations, pro rata among the
Secured Parties according to the amounts of the Obligations then due and owing
and remaining unpaid to the Secured Parties;

 

Third, towards payment of any remaining Obligations, pro
rata among the Secured Parties according to the amounts of the
Obligations then held by the Secured Parties; and

 

Fourth, any balance remaining after the Obligations shall
have been paid in full shall be paid over to the Borrower or to whomsoever may
be lawfully entitled to receive the same.

 

6.6.          Code and Other Remedies. If an
Event of Default occurs and is continuing, the Administrative Agent, on behalf
of the Secured Parties, may exercise, in addition to all other rights and
remedies granted to them in this Agreement and in any other instrument or
agreement securing, evidencing or relating to the Obligations, all rights and
remedies of a secured party under the New York UCC or any other applicable law.
Without limiting the generality of the foregoing, if an Event of Default occurs
and is continuing, the Administrative Agent, without demand of performance or
other demand, presentment, protest, advertisement or notice of any kind (except
any notice required by law referred to below) to or upon any Grantor or any
other Person (all and each of which demands, defenses,

 

19

 

advertisements and notices are hereby
waived), may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith sell,
lease, assign, give option or options to purchase, or otherwise dispose of and
deliver the Collateral or any part thereof (or contract to do any of the
foregoing), in one or more parcels at public or private sale or sales, at any exchange,
broker’s board or office of the Administrative Agent or any other Secured Party
or elsewhere upon such terms and conditions as it may deem advisable and at
such prices as it may deem best, for cash or on credit or for future delivery
without assumption of any credit risk. The Administrative Agent or any other
Secured Party shall have the right upon any such public sale or sales, and, to
the extent permitted by law, upon any such private sale or sales, to purchase
the whole or any part of the Collateral so sold, free of any right or equity of
redemption in any Grantor, which right or equity is hereby waived and released.
Each Grantor further agrees, at the Administrative Agent’s request following
and during the continuance of an Event of Default, to assemble the Collateral
and make it available to the Administrative Agent at places which the
Administrative Agent shall reasonably select, whether at such Grantor’s
premises or elsewhere. The Administrative Agent shall apply the net proceeds of
any action taken by it pursuant to this Section 6.6, after deducting all
reasonable out-of-pocket costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any of the
Collateral or in any way hereunder, including, without limitation, reasonable
attorneys’ fees and disbursements, to the payment in whole or in part of the
Obligations, in such order as the Administrative Agent may elect, and only
after such application and after the payment by the Administrative Agent of any
other amount required by any provision of law, including, without limitation, Section 9-615(a)(3) of
the New York UCC, need the Administrative Agent account for the surplus, if
any, to any Grantor. To the extent permitted by applicable law, each Grantor
waives all claims, damages and demands it may acquire against the
Administrative Agent or any other Secured Party arising out of the exercise by
them of any rights hereunder. If any notice of a proposed sale or other
disposition of Collateral shall be required by law, such notice shall be deemed
reasonable and proper if given at least 10 days before such sale or other
disposition.

 

6.7.          Registration Rights.  (a) If
the Administrative Agent shall determine to exercise its rights to sell all or
any of the Pledged Equity pursuant to Section 6.6, and if, in the opinion
of the Administrative Agent, it is necessary or advisable to have the Pledged
Equity, or that portion thereof to be sold, registered under the provisions of
the Securities Act, the relevant Grantor will cause the Issuer thereof to (i) execute
and deliver, and cause the directors and officers of such Issuer to execute and
deliver, all such instruments and documents, and do or cause to be done all
such other acts as may be, in the opinion of the Administrative Agent,
necessary or advisable to register the Pledged Equity, or that portion thereof
to be sold, under the provisions of the Securities Act, (ii) use its best
efforts to cause the registration statement relating thereto to become
effective and to remain effective for a period of one year from the date of the
first public offering of the Pledged Equity, or that portion thereof to be
sold, and (iii) make all amendments thereto and/or to the related
prospectus which, in the opinion of the Administrative Agent, are necessary or
advisable, all in conformity with the requirements of the Securities Act and
the rules and regulations of the Securities and Exchange Commission
applicable thereto. Each Grantor agrees to cause such Issuer to comply with the
provisions of the securities or “Blue Sky” laws of any and all jurisdictions
with the Administrative Agent shall designate and to make available to its
security holders, as soon as practicable, an earnings statement (which need not
be audited) which will satisfy the provisions of Section 11(a) of the
Securities Act.

 

(b)  Each
Grantor recognizes that the Administrative Agent may be unable to effect a
public sale of any or all the Pledged Equity, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the

 

20

 

distribution or resale thereof. Each Grantor
acknowledges and agrees that any such private sale may result in prices and
other terms less favorable than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner. The
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Equity for the period of time necessary to permit the Issuer thereof to
register such securities for public sale under the Securities Act, or under
applicable state securities laws, even if such Issuer would agree to do so.

 

(c)  Each
Grantor agrees to use its best efforts to do or cause to be done all such other
acts as may be necessary to make such sale or sales of all or any portion of
the Pledged Equity pursuant to this Section 6.7 valid and binding and in
compliance with any and all other applicable Law. Each Grantor further agrees
that a breach of any of the covenants contained in this Section 6.7 will
cause irreparable injury to the Administrative Agent and the other Secured
Parties, that the Administrative Agent and the other Secured Parties have no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section 6.7 shall be
specifically enforceable against such Grantor, and such Grantor hereby waives,
to the fullest extent permitted by applicable law, and agrees not to assert any
defenses against an action for specific performance of such covenants except
for a defense that no Event of Default has occurred and is continuing under the
Term Loan Agreement.

 

6.8.          Deficiency.  Each
Grantor shall remain liable for any deficiency if the proceeds of any sale or
other disposition of the Collateral are insufficient to pay its Obligations and
the reasonable fees and disbursements of any attorneys employed by the
Administrative Agent or any other Secured Party to collect such deficiency.

 

6.9.          Notice of Sole Control.  Upon
the occurrence and during the continuance of an Event of Default, the
Administrative Agent may give notice of sole control or any other instruction
under any Deposit Account Control Agreement with respect to any Collateral
Deposit Account or and other control agreement with any Securities Intermediary
with respect to any Securities Account or with any Commodity Intermediary with
respect to any Commodity Account and take any action therein with respect to
such Collateral, and the Administrative Agent agrees not to give any such
notice or instruction unless there is an occurrence and continuance of an Event
of Default. The Administrative Agent agrees to withdraw any such notice of sole
control as soon as practicable upon any such Event of Default ceasing to exist
(or, if any such notice of sole control may not be withdrawn, to terminate the
applicable control agreement and enter into a new control agreement on the same
terms).

 

SECTION 7.           THE
ADMINISTRATIVE AGENT

 

7.1.          Administrative Agent’s Appointment
as Attorney-in-Fact, etc.  (a) Each Grantor hereby
irrevocably constitutes and appoints the Administrative Agent and any officer
or agent thereof, with full power or substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Grantor and in the name of such Grantor or in its own name, for
the purpose of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments which
may be necessary or desirable to accomplish the purposes of this Agreement,
and, without limiting the generality of the foregoing, each Grantor hereby
gives the Administrative Agent the power and right, on behalf of such Grantor,
without notice to or assent by such Grantor, to do any or all of the following:

 

(i)            in the name of such
Grantor or its own name, or otherwise, take possession of and indorse and
collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any Receivable required to be included in
Collateral hereunder or with respect to any other Collateral and file any claim
or take any other action or proceeding in

 

21

 

any
court of law or equity or otherwise deemed appropriate by the Administrative
Agent for the purpose of collecting any and all such moneys due under any such
Receivable or with respect to any other Collateral whenever payable;

 

(ii)           in the case of any
Intellectual Property required to be included in Collateral hereunder, execute
and deliver, and have recorded, any and all agreements, instruments, documents
and papers as the Administrative Agent may request to evidence the
Administrative Agent’s and the other Secured Parties’ security interest in such
Intellectual Property and the goodwill and general intangibles of such Grantor
relating thereto or represented thereby;

 

(iii)          pay or discharge
taxes and Liens levied or placed on or threatened against the Collateral,
effect any repairs or any insurance called for by the terms of this Agreement
and pay all or any part of the premiums therefor and the costs thereof;

 

(iv)          execute, in
connection with any sale provided for in Section 6.6 or 6.7, any
indorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral; and

 

(v)           (1) direct any
party liable for any payment under any of the Collateral to make payment of any
and all moneys due or to become due thereunder directly to the Administrative
Agent or as the Administrative Agent shall direct; (2) ask or demand for,
collect, and receive payment of and receipt for, any and all moneys, claims and
other amounts due or to become due at any time in respect of or arising out of
any Collateral; (3) sign and indorse any invoices, freight or express
bills, bills of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications, notices and other documents in connection with any
of the Collateral; (4) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any portion thereof and to enforce any other right in
respect of any Collateral; (5) defend any suit, action or proceeding
brought against such Grantor with respect to any Collateral; (6) settle,
compromise or adjust any such suit, action or proceeding and, in connection
therewith, give such discharges or releases as the Administrative Agent may
reasonably deem appropriate; (7) subject to any licenses (and the rights
granted therein) existing at the time of such assignment, assign any Copyright,
Patent or Trademark (along with the goodwill of the business to which any such
Copyright, Patent or Trademark pertains), throughout the world for such term or
terms, on such conditions, and in such manner, as the Administrative Agent
shall in its sole discretion determine; and (8) generally, sell, transfer,
pledge and make any agreement with respect to or otherwise deal with any of the
Collateral as fully and completely as though the Administrative Agent were the
absolute owner thereof for all purposes, and do, at the Administrative Agent’s
option and such Grantor’s expense, at any time, or from time to time, all acts
and things which the Administrative Agent deems necessary to protect, preserve
or realize upon the Collateral and the Administrative Agent’s and the other
Secured Parties’ security interests therein and to effect the intent of this Agreement,
all as fully and effectively as such Grantor might do.

 

Anything
in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the
power of attorney provided for in this Section 7.1(a) unless an Event
of Default shall have occurred and be continuing.

 

(b)  If
any Grantor fails to perform or comply with any of its agreements contained
herein, the Administrative Agent, at its option, but without any obligation so
to do, may perform or comply, or otherwise cause performance or compliance,
with such agreement.

 

22

 

(c)  The
reasonable out-of-pocket expenses of the Administrative Agent incurred in
connection with actions undertaken as provided in this Section 7.1,
together with interest thereon at a rate per annum equal to the highest rate
per annum at which interest would then be payable on any category of past due
Base Rate Loans under the Term Loan Agreement, from the date of payment by the
Administrative Agent to the date reimbursed by the relevant Grantor, shall be
payable by such Grantor to the Administrative Agent on demand.

 

(d)  Each
Grantor hereby ratifies all that said attorneys shall lawfully do or cause to
be done by virtue hereof. All powers, authorizations and agencies contained in
this Agreement are coupled with an interest and are irrevocable until this
Agreement is terminated and the security interests created hereby are released.

 

7.2           Duty of Administrative Agent.  The Administrative Agent’s sole duty with
respect to the custody, safekeeping and physical preservation of the Collateral
in its possession, under Section 9-207 of the New York UCC or otherwise,
shall be to deal with it in the same manner as the Administrative agent deals
with similar property for its own account. Neither the Administrative Agent,
any other Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
any Grantor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. The powers conferred on the
Administrative Agent and the other Secured Parties hereunder are solely to
protect the Administrative Agent’s and the other Secured Parties’ interests in
the Collateral and shall not impose any duty upon the Administrative Agent or
any other Secured Party to exercise any such powers. The Administrative Agent
and the other Secured Parties shall be accountable only for amounts that they
actually receive as a result of the exercise of such powers, and neither they
nor any of their officers, directors, employees or agents shall be responsible
to any Grantor for any act or failure to act hereunder, except for their own
gross negligence or willful misconduct.

 

7.3           Execution of Financing Statements.  Pursuant to any applicable law, each Grantor
authorizes the Administrative Agent to file or record financing statements and
other filing or recording documents or instruments with respect to the
Collateral without the signature of such Grantor in such form and in such
offices as the Administrative Agent determines appropriate to perfect the
security interests of the Administrative Agent under this Agreement. Each
Grantor authorizes the Administrative Agent to use the collateral description
“all personal property” or “all assets” in any such financing statements. Each
Grantor hereby ratifies and authorizes the filing by the Administrative Agent
of any financing statement with respect to the Collateral made prior to the
date hereof; provided that, at the reasonable request of any Grantor,
the Administrative Agent shall amend any such statement (and any other
financing statement filed by the Administrative Agent in connection with this
Agreement) to exclude any property that is released from, or otherwise not
included in, the Collateral. The Administrative Agent agrees promptly to
furnish copies of all such filings to the Borrower.

 

7.4           Authority of Administrative Agent.
 Each Grantor acknowledges that the
rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the other
Secured Parties, be governed by the Term Loan Agreement, and, if Exchange Notes
are outstanding, as between the Trustee and the Holders, by the Indenture, and
in each case by such other agreements with respect thereto as my exist from
time to time among them, but, as between the Administrative Agent and the
Grantors, the Administrative Agent shall be conclusively presumed to be acting
as agent for the Secured Parties with

 

23

 

full and valid authority so to act or refrain
from acting, and no Grantor shall be under any obligation, or entitlement, to
make any inquiry respecting such authority.

 

SECTION 8.           MISCELLANEOUS

 

8.1.          Amendments in Writing.  (a) None
of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified except in accordance with Section 9.1
of the Term Loan Agreement.

 

(b)  The
parties hereto agree to amend, or amend and restate, this Agreement or any
other Security Document upon the request of the Administrative Agent in
connection with the issuance of Exchange Notes and the execution and delivery
of the Indenture in order, as may be reasonably requested or necessary, to (i) replace
the Administrative Agent with the Trustee or its designee and (ii) to
facilitate compliance of this Agreement and the Indenture, or of the Trustee,
with the Trust Indenture Act of 1939 or any other Federal or state securities
laws applicable to this Agreement, the Indenture or the Exchange Notes or the
Trustee.

 

(c)  the
parties hereto agree to amend, or amend and restate, this Agreement or any
other Security Document upon the request of the Borrower in connection with the
issuance of Take-Out Debt, as may be reasonably requested or necessary, to (i) provide
for obligations in respect of the Take-Out Debt to be guaranteed and secured
hereunder on the same basis as the Exchange Notes and (ii) to facilitate
compliance of this Agreement and any indenture governing the Take-Out Debt, or
of the trustee under any such indenture, with the Trust Indenture Act of 1939
or any other Federal or State securities laws applicable to this Agreement, any
such indenture or the Take-Out Debt or any such trustee.

 

8.2           Notices.  All
notices, requests and demands to or upon the Administrative Agent or any
Grantor hereunder shall be effected in the manner provided for in Section 9.2
of the Term Loan Agreement; provided that any such notice, request or
demand to or upon any Guarantor shall be addressed to such Guarantor at its
notice address set forth on Schedule 1.

 

8.3           No Waiver by Course of Conduct;
Cumulative Remedies.  Neither the Administrative Agent nor any
other Secured Party shall by any act (except by a written instrument pursuant
to Section 8.1), delay, indulgence, omission or otherwise be deemed to
have waived any right or remedy hereunder or to have acquiesced in any Default
or Event or Default. No failure to exercise, nor any delay in exercising, on
the part of the Administrative Agent or any other Secured Party, any right,
power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any other Secured Party of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Administrative Agent or such Secured Party
would otherwise have on any future occasion. The rights and remedies herein
provided are cumulative, may be exercised singly or concurrently and are not
exclusive of any other rights or remedies provided by law.

 

8.4           Enforcement Expenses;
Indemnification.  (a) Each Guarantor agrees to pay or
reimburse each Secured Party and the Administrative Agent for all its
reasonable out-of-pocket costs and expenses incurred in collecting against such
Guarantor under the guarantee contained in Section 2 or otherwise
enforcing or preserving any rights under this Agreement and the other Financing
Documents to which such Guarantor is a party, including, without limitation,
the reasonable fees and disbursements of counsel to the Administrative Agent.

 

24

 

(b)  Each
Guarantor agrees to pay, and to save the Administrative Agent and the other
Secured Parties harmless from, any and all liabilities with respect to, or
resulting from any delay in paying, any and all stamp, excise, sales or other taxes
which may be payable or determined to be payable with respect to any of the
Collateral or in connection with any of the transactions contemplated by this
Agreement.

 

(c)  Each
Guarantor agrees to pay, and to save the Administrative Agent and the other
Secured Parties harmless from, any and all liabilities, obligations, losses,
damages, penalties, claims, demands, actions, judgments and suits and related
reasonable out-of-pocket expenses (including Attorney Costs) of any kind or
nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement to the extent the Borrower
would be required to do so pursuant to Section 9.5 of the Term Loan
Agreement.

 

(d)  The
agreements in this Section 8.4 shall survive repayment of the Obligations
and all other amounts payable under the Term Loan Agreement and the other
Financing Documents.

 

8.5.          Successors and Assigns.  This
Agreement shall be binding upon the permitted successors and assigns of each
Grantor and shall inure to the benefit of the Administrative Agent and the
other Secured Parties and their permitted successors and assigns; provided
that no Grantor may, except pursuant to a merger or consolidation permitted by
the Term Loan Agreement, assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.

 

8.6           Setoff.  In addition
to any rights and remedies of the Lenders provided by Law, upon the occurrence
and during the continuance of any Event of Default, each Lender and its
Affiliates is authorized at any time and from time to time, without prior
notice to any Grantor, any such notice being waived by each Grantor to the
fullest extent permitted by applicable Law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held by, and other Indebtedness at any time owing by, such Lender and its
Affiliates to or for the credit or the account of any Grantor against any and
all Obligations owing to such Lender and its Affiliates hereunder or under any
other Financing Document, now or hereafter existing, irrespective of whether or
not such Agent or such Lender or Affiliate shall have made demand under this
Agreement or any other Financing Document and although such Obligations may be
contingent or unmatured or denominated in a currency different from that of the
applicable deposit or indebtedness; provided that,
in the case of any such deposits or other Indebtedness for the credit or the
account of any Foreign Subsidiary, such set off may only be against any
Obligations of Foreign Subsidiaries. Each Lender agrees promptly to notify such
Grantor and the Administrative Agent after any such set off and application
made by such Lender; provided, that
the failure to give such notice shall not affect the validity of such setoff
and application. The rights of the Administrative Agent and each Lender under
this Section 8.6 are in addition to other rights and remedies (including
other rights of setoff) that the Administrative Agent and such Lender may have.

 

8.7           Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. Delivery by telecopier of an executed counterpart of a signature page to
this Agreement shall be effective as delivery of an original executed
counterpart of this Agreement.

 

8.8           Severability.  If
any provision of this Agreement is held to be illegal, invalid or
unenforceable, the legality, validity and enforceability of the remaining
provisions of this Agreement shall not be affected or impaired thereby. The
invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

 

25

 

8.9.          Section Headings.  The
Section headings used in this Agreement are for convenience of reference
only and are not to affect the construction hereof or be taken into
consideration in the interpretation hereof.

 

8.10.        Integration.  This
Agreement, together with the other Financing Documents, comprises the complete
and integrated agreement of the parties on the subject matter hereof and
thereof and supersedes all prior agreements, written or oral, on such subject
matter.

 

8.11.       GOVERNING LAW.  THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
THE STATE OF NEW YORK.

 

8.12.        Submission To Jurisdiction; Waivers.  (a) Any
legal action or proceeding arising under any Financing Document or in any way
connected with or related or incidental to the dealings of the parties hereto
or any of them with respect to any Financing Document, or the transactions
related thereto, in each case whether now existing or hereafter arising, may be
brought in the courts of the State of New York sitting in New York City or of
the United States for the southern District of such State, and by execution and
delivery of this Agreement, each Grantor and the Administrative Agent consents,
for itself and in respect of its property, to the non-exclusive jurisdiction of
those courts. Each Grantor and the Administrative Agent irrevocably waives any
objection, including any objection to the laying of venue or based on the
grounds of forum non conveniens, which it may now or hereafter have to the
bringing of any action or proceeding in such courts in respect of any Financing
Document or other document related thereto.

 

(b)  Each
Grantor hereby irrevocably and unconditionally:

 

(i)            agrees that service
of process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to such Grantor at its address referred to in Section 8.2
or at such other address of which the Administrative Agent shall have been
notified pursuant thereto;

 

(ii)           agrees that nothing
herein shall affect the right to effect service of process in any other manner
permitted by law or shall limit the right to sue in any other jurisdiction; and

 

(iii)          waives, to the
maximum extent not prohibited by law, any right it may have to claim or recover
in any legal action or proceeding referred to in this Section any special,
exemplary, punitive or consequential damages.

 

8.13.        Acknowledgements.  Each
Grantor hereby acknowledges that:

 

(a)  it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Financing Documents to
which it is a party;

 

(b)  neither the Administrative Agent nor any other Secured
Party has any fiduciary relationship with or duty to any Grantor arising out of
or in connection with this Agreement or any of the other Financing Documents,
and the relationship between the Grantors, on the one hand, and the
Administrative Agent and the other Secured Parties, on the other hand, in
connection herewith or therewith is solely that of debtor and creditor; and

 

(c)  no joint venture is created hereby or by the other
Financing Documents or otherwise exists by virtue of the transactions contemplated
hereby among the Secured Parties or among the Grantors and the Secured Parties.

 

23

 

8.14.        Additional Guarantors and Grantors.  Each
Subsidiary of the Borrower that is required to become a party to this Agreement
pursuant to the Term Loan Agreement shall become a Guarantor and a Grantor for
all purposes of this Agreement upon execution and delivery by such Subsidiary
of an Assumption Agreement in the form of Annex 1 hereto.

 

8.15.        Releases.  (a) At
such time as the Loans and the other Obligations (other than contingent
indemnification and contingent expense reimbursement obligations) shall have
been paid in full, the Collateral shall be released from the Liens created
hereby, and this Agreement and all obligations (other than those expressly
stated to survive such termination) of the Administrative Agent and each
Grantor hereunder shall terminate, all without delivery of any instrument or
performance of any act by any party, and all rights to the Collateral shall
revert to the Grantors. At the request and sole expense of any Grantor
following any such termination, the Administrative Agent shall deliver to such
Grantor any Collateral held by the Administrative Agent hereunder and execute
and deliver to such Grantor such documents as such Grantor shall reasonably
request to evidence such termination.

 

(b)  If
any of the Collateral shall be sold, transferred or otherwise disposed of by
any Grantor in a transaction permitted by the Term Loan Agreement, then (i) the
Liens created hereby on such Collateral shall automatically be released and (ii) the
Administrative Agent, at the request and sole expense of such Grantor, shall
execute and deliver to such Grantor all releases or other documents reasonably
necessary or desirable for the release of the Liens created hereby on such
Collateral. In addition, at the request and at the sole expense of the
Borrower, the Administrative Agent agrees to (x) provide to each Grantor a
power of attorney to execute any document reasonably required to permit any
sale permitted by the Term Loan Agreement of any asset, the perfection of which
is governed by a certificate-of-title statute, free of the Liens created by the
Security Documents and (y) with respect to any jurisdiction in which
releases executed pursuant to such power of attorney are insufficient to
release such Liens, (1) execute in blank any document reasonably required
to permit any sale permitted by the Term Loan Agreement of any asset, the
perfection of which is governed by a certificate-of-title statute, free of the
Liens created by the Security Documents and (2) authorize such Grantor to
fill in the relevant information to release such Lien. At the request and sole
expense of the Borrower, a Subsidiary Guarantor shall be released from its
obligations hereunder in the event that all the Capital Stock of such
Subsidiary Guarantor shall be sold, transferred or otherwise disposed of in a
transaction permitted by the Term Loan Agreement; provided that the
Borrower shall have delivered to the Administrative Agent, at least five
Business Days prior to the date of proposed release, a written request for
release identifying the relevant Subsidiary Guarantor and the terms of the sale
or other disposition in reasonable detail, including the price thereof and any
expenses in connection therewith, together with a certification by the Borrower
stating that such transaction is in compliance with the Term Loan Agreement and
the other Financing Documents.

 

8.16.       WAIVER OF JURY
TRIAL.  EACH GRANTOR HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL
BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY
FINANCING DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY FINANCING
DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR
OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A
JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 8.16 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.

 

27

 

8.17.        Effectiveness of the Merger;
Assignment and Delegation to and Assumption by the Target.  The
Target and its Subsidiaries shall have no rights or obligations hereunder until
the consummation of the Merger and any representations and warranties of the
Target or any of its Subsidiaries hereunder shall not become effective until
such time.  Upon consummation of the Merger,
all rights, obligations, representations and warranties of the Target and its
Subsidiaries under this Agreement and the other Financing Documents shall
become effective as of the date hereof, without any further action by any
Person.

 

28

 

IN
WITNESS WHEREOF, each of the undersigned has caused this Guarantee and
Collateral Agreement to be duly executed and delivered as of the date first
above written.

 

 

	
   

  	
  GLOBAL
  AERO LOGISTICS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Subodh Karnik

  
	
   

  	
   

  	
  Name:

  	
  Subodh
  Karnik

  
	
   

  	
   

  	
  Title:
  

  	
  President
  and CEO

  

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  NEW
  ATA INVESTMENT INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Subodh Karnik

  
	
   

  	
   

  	
  Name:

  	
  Subodh
  Karnik

  
	
   

  	
   

  	
  Title:

  	
  President
  and CEO

  

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  NEW
  ATA ACQUISITION INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Subodh Karnik

  
	
   

  	
   

  	
  Name:

  	
  Subodh
  Karnik

  
	
   

  	
   

  	
  Title:

  	
  President
  and CEO

  

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  ATA
  AIRLINES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Subodh Karnik

  
	
   

  	
   

  	
  Name:

  	
  Subodh
  Karnik

  
	
   

  	
   

  	
  Title:

  	
  President
  and CEO

  
					

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  WORLD
  AIR HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Randy J. Martinez

  
	
   

  	
   

  	
  Name:

  	
  Randy
  J. Martinez

  
	
   

  	
   

  	
  Title:

  	
  CEO

  

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  NORTH
  AMERICAN AIRLINES, INC.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/
  Mark M. McMillin

  
	
   

  	
   

  	
  Name:

  	
  Mark
  M. McMillin

  	 

	
   

  	
   

  	
  Title:

  	
  General
  Counsel & Corp Secretary

  	 

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  WORLD
  AIRWAYS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Mark M. McMillin

  
	
   

  	
   

  	
  Name:

  	
  Mark
  M. McMillin

  
	
   

  	
   

  	
  Title:

  	
  General
  Councel & Corp Secretary

  

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  WORLD
  AIRWAYS PARTS COMPANY, LCC

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/
  Michael W. Towe

  
	
   

  	
   

  	
  Name:

  	
  Michael
  W. Towe

  	 

	
   

  	
   

  	
  Title:

  	
  Manager

  	 

 

[Signature Page to Guarantee and Collateral Agreement]

 

 

	
   

  	
  JPMORGAN
  CHASE BANK, N.A., as Administrative

  Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John C. Riordan

  
	
   

  	
   

  	
  Name:

  	
  JOHN
  C. RIORDAN

  
	
   

  	
   

  	
  Title:

  	
    VICE
  PRESIDENT

  

 

[Signature Page to Guarantee and Collateral Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}]]