Document:

Exhibit

10.28

 

EXECUTION COPY

 

	

   

  

 

 

ADMINISTRATION

AGREEMENT*

 

among

 

WILLIS ENGINE

FUNDING LLC,

as Issuer,

 

WILLIS LEASE

FINANCE CORPORATION,

as Servicer

 

BARCLAYS BANK PLC,

as Administrative

Agent

 

and

 

THE BANK OF NEW

YORK,

as Indenture

Trustee

 

Dated as of

September 12, 2002

 

 

	

   

  

 

*               Portions

of the material in this Exhibit have been redacted pursuant to a request for

confidential treatment, and the redacted material has been filed separately

with the Securities and Exchange Commission (the “Commission”).  An asterisk has been placed in the precise

places in this Agreement where we have redacted information, and the asterisk

is keyed to a legend which states that the material has been omitted pursuant

to a request for confidential treatment.

 

 

EXECUTION COPY

 

This ADMINISTRATION AGREEMENT, dated as of September

12, 2002 (the ”Agreement”), among WILLIS ENGINE FUNDING LLC, a Delaware

limited liability company (the ”Issuer”), WILLIS LEASE FINANCE

CORPORATION, a Delaware corporation (the “Servicer”), BARCLAYS BANK PLC

(the ”Administrative Agent”) and THE BANK OF NEW YORK, a New York banking

corporation, as Indenture Trustee (the ”Indenture Trustee”).

 

W I T N E S S E T H:

 

WHEREAS, the Issuer is issuing its Series 2002-1 Notes

(the ”Series 2002–1 Notes”) pursuant to the Series 2002-1

Supplement, dated as of September 12, 2002 (the ”Series 2002-1

Supplement”) to the Indenture, dated as of September 12, 2002

(the ”Indenture”), each between the Issuer and The Bank of New York, as

trustee (the ”Indenture Trustee”);

 

WHEREAS, pursuant to the Indenture and the other

Related Documents, the Administrative Agent is required to perform certain

duties referred to therein; and

 

WHEREAS, the Administrative Agent has the capacity to

provide the services required thereby and is willing to perform such services

on the terms set forth herein;

 

NOW, THEREFORE, in consideration of the mutual

covenants contained herein, and other, good and valuable consideration, the

receipt and adequacy of which are hereby acknowledged, the parties agree as

follows:

 

SECTION 1.           Definitions.  Capitalized terms used and not otherwise

defined herein shall have the meanings assigned to such terms in the Series

2002-1 Supplement or, if not defined therein, as defined in the Indenture.

 

SECTION 2.           Appointment and Authority of

Administrative Agent.  Subject to

the terms and conditions set forth herein, the Indenture Trustee, on behalf of

the Noteholders, hereby appoints the Administrative Agent to perform all of the

activities set forth in Section 3 hereof. 

By executing this Agreement, the Administrative Agent hereby accepts

such appointment.

 

SECTION 3.           Duties of the Administrative Agent.  Subject to the limitations set forth in this

Agreement, the duties of the Administrative Agent shall be limited to the

following:

 

(a)           Facilitation of Transfer to Replacement Servicer.  Upon receipt of a copy of a notice that a

Servicer Termination Notice has been issued pursuant to Section 405(b) of

the Indenture, the Administrative Agent shall use reasonable efforts to locate

a qualified replacement Servicer to fulfill the duties of the then current

Servicer in accordance with, and subject to the terms and conditions set forth

in, Section 405(b) of the Indenture. 

The Administrative Agent agrees to perform the duties set forth in

Section 405(b) of the Indenture.

 

(b)           Facilitation of Transfer to Successor Indenture

Trustee.  Upon receipt of a

copy of the notice given by the Indenture Trustee pursuant to Section 907 of

the

 

 

Indenture,

the Administrative Agent shall use reasonable efforts to locate a qualified

successor trustee to fulfill the duties of the then current Indenture Trustee.

 

(c)           Reserved.

 

(d)           The Administrative Agent shall take

all action required of it under the Indenture or the Series 2002-1 Supplement.  All such obligations of the Administrative

Agent set forth therein are incorporated herein by reference and failure to

take any such action shall constitute a breach of this Agreement.

 

SECTION 4.           Standard. of Care; Conformity with

Applicable Law; Liability of Administrative Agent.  (a) 

The Administrative Agent will perform its duties hereunder in accordance

with the same standard of care exercised by the Administrative Agent in the

conduct of similar affairs for its own account.

 

(b)           The Administrative Agent will not, in

performing its obligations hereunder, take any action that would be in

violation of any law, rule or regulation that may be applicable to the

Administrative Agent, its property or the services to be performed hereunder.

 

(c)           The Administrative Agent shall not

(a) be liable for any action taken or omitted to be taken by it under or in

connection with this Agreement (except for its own gross negligence or willful

misconduct), or (b) be responsible in any manner for any recital, statement, representation

or warranty made by the Issuer, Indenture Trustee or Servicer, or any officer

thereof, contained in this Agreement or in any other Related Document, or in

any certificate, report, statement or other document referred to or provided

for in, or received by the Administrative Agent under or in connection with,

this Agreement or in any other Related Document, or for the value of any

Collateral or the validity, effectiveness, genuineness, enforceability or

sufficiency of any Related Document, or for any failure of the Issuer,

Indenture Trustee or Servicer or any other party to any Related Document to

perform its obligations thereunder except to the extent set forth therein.  The Administrative Agent shall be entitled

to rely, and shall be fully protected in relying, upon any writing, resolution,

notice, consent, certificate, affidavit, letter, telegram, facsimile or other

document reasonably believed by it to be genuine and correct and to have been

signed or sent by the proper Person or Persons, and upon advice and statements

of legal counsel, independent accountants and other experts selected by the

Administrative Agent.

 

SECTION 5.           Records.  The Administrative Agent shall maintain

appropriate books of account and records relating to services performed

hereunder, which books of account and records shall upon prior written notice

to the Administrative Agent be accessible for inspection at the offices of the

Administrative Agent by the Issuer, the Servicer and the Indenture Trustee, and

the agents of any of them, at such inspecting party’s expense during the

Administrative Agent’s normal business hours.

 

SECTION 6.           Indemnification.  (a)             The

Administrative Agent hereby agrees to indemnify and hold harmless the Indenture

Trustee, each Noteholder and their respective directors, officers and

shareholders (each an “Indemnified Party”) from and against any and all

damages, losses, liabilities, costs and expenses incurred by an Indemnified

Party resulting from 

 

2

 

the

gross negligence or willful misconduct of the Administrative Agent in

performing (or failing to perform) its obligations under this Agreement.  An Indemnified Party shall immediately

notify the Administrative Agent of any damages, losses, liabilities, costs or

expenses which an Indemnified Party has determined has given or would give rise

to a right of indemnification hereunder and the Administrative Agent shall have

the exclusive right to compromise or defend any such liability or claim at its

own expense, which decision shall be binding and conclusive upon an Indemnified

Party.  Failure to give such notice

shall not relieve the Administrative Agent of its obligations hereunder; provided,

however, that the Administrative Agent shall not be liable or

otherwise be held responsible for any damages, losses, liabilities, costs or

expenses resulting from the failure to give such notice.  The Administrative Agent hereby agrees to

indemnify and hold harmless the Issuer from and against any and all damages, losses,

liabilities, costs and expenses incurred by the Issuer resulting from the gross

negligence or willful misconduct of the Administrative Agent in performing its

obligations under Section 2.2(c) of the Series 2002-1 Supplement.

 

(b)           The Issuer and the Servicer shall

jointly and severally indemnify and hold harmless the Administrative Agent from

and against any and all liabilities, obligations, losses, damages, penalties,

actions, judgments, suits, costs, expenses and disbursements of any kind

whatsoever which may at any time (including at any time following the repayment

of any Outstanding Obligations and the termination or resignation of the

related Administrative Agent) be imposed on, incurred by or asserted against

the Administrative Agent in any way relating to or arising out of this

Agreement or any document contemplated by or referred to herein or therein or

the transactions contemplated hereby or thereby or any action taken or omitted

by the Administrative Agent under or in connection with any of the foregoing; provided,

however, that neither the Issuer nor the Servicer shall be liable

for the payment to the Administrative Agent of any portion of such liabilities,

obligations, losses, damages, penalties, actions, judgments, suits, costs,

expenses or disbursements resulting solely from the Administrative Agent’s

gross negligence or willful misconduct.

 

SECTION 7.           Compensation.  As compensation for the performance of the

Administrative Agent’s obligations under this Agreement, the Issuer agrees to

pay quarterly in arrears, beginning with the third Payment Date, to the

Administrative Agent a fee at the rate of      %* per

annum of the sum of the Aggregate Note Principal Balance of all Series then

Outstanding on the related quarterly Payment Date; notwithstanding payment of

such fee by the Servicer, each of the parties hereto acknowledge that the

Administrative Agent is the agent of the Noteholders.  If the Servicer fails to pay such fee, the Issuer shall pay such unpaid

amounts from amounts on deposit in the Series 2002-1 Series Account in

accordance with the provisions of Section 3.2 of the Series 2002-1

Supplement.  In addition, the

Administrative Agent shall also be entitled to be reimbursed in accordance with

Section 3.2 of the Series 2002-1 Supplement for its expenses incurred in taking

any actions required pursuant to Section 405(b) of the Indenture.

 

SECTION 8.           Independence of the Administrative

Agent.  For all purposes of this

Agreement, the Administrative Agent shall be an agent of the Noteholders and

shall not be subject to the supervision of the Issuer, Servicer or Indenture

Trustee with respect to the manner

 

*               This

redacted material has been omitted pursuant to a request for confidential

treatment, and the material has been filed separately with the Commission.

 

3

 

in which

it accomplishes the performance of its obligations hereunder; provided,

however, that the Administrative Agent shall act in accordance with

directions from the Requisite Global Majority when required by the Indenture or

the Related Documents.

 

SECTION 9.           No Joint Venture.  Nothing contained in this Agreement

(i) shall constitute the Administrative Agent, the Issuer, the Servicer

and the Indenture Trustee as members of any partnership, joint venture,

association, syndicate, unincorporated business or other separate entity,

(ii) shall be construed to impose any liability as such on any of them or

(iii) shall be deemed to confer on any of them any express, implied or apparent

authority to incur any obligation or liability on behalf of the others.

 

SECTION 10.         Other Activities of the

Administrative Agent.  Nothing

herein shall prevent the Administrative Agent or its Affiliates from engaging

in other businesses or, in its sole discretion, from acting in a similar

capacity as an administrator for any other Person even though such Person may

engage in business activities similar to those of the Issuer and/or the

Servicer.

 

SECTION 11.         Term of Agreement; Resignation and

Removal of Administrative Agent. 

(a)  This Agreement shall

continue in force until all of the Outstanding Obligations under the Indenture

are paid in full, upon which event this Agreement shall automatically

terminate.

 

(b)           The Administrative Agent may resign

its duties hereunder by providing each of the Issuer, the Servicer and the

Indenture Trustee with at least 60 days’ prior written notice.

 

(c)           The Indenture Trustee, acting at the

written direction of the Requisite Global Majority, or of the Issuer, may

remove the Administrative Agent immediately upon written notice of termination

to the Administrative Agent (with a copy to each of the Issuer and the

Servicer) if any of the following events shall occur:

 

(i)            the Administrative Agent shall

default in any material respect the performance of any of its duties under this

Agreement which failure continues unremedied for a period of fifteen (15) days

after the receipt by the Administrative Agent of written notice thereof

specifying with reasonable detail the default;

 

(ii)           a court having jurisdiction in the

premises shall enter a decree or order for relief, and such decree or order

shall not have been vacated within 60 days, in respect of the Administrative

Agent in any involuntary case under any applicable bankruptcy, insolvency or

other similar law now or hereafter in effect or appoint a receiver, liquidator,

assignee, custodian, trustee, sequestrator or similar official for the

Administrative Agent or any substantial part of its property or order the

winding-up or liquidation of its affairs; or

 

(iii)          the Administrative Agent shall

commence a voluntary case under any applicable bankruptcy, insolvency or other

similar law now or hereafter in effect, shall consent to the entry of an order

for relief in an involuntary case under any such law, or shall consent to the

appointment of a receiver, liquidator, assignee, trustee, custodian,

sequestrator or similar official for the Administrative Agent or any

substantial part of its property, shall consent to the taking of possession by any

such official of any substantial part of its property, shall make

 

4

 

any

general assignment for the benefit of creditors or shall fail generally to pay

its debts as they become due.

 

(d)           No resignation or removal of the

Administrative Agent pursuant to this Section 11 shall be effective until (i) a

successor Administrative Agent shall have been appointed by the Requisite

Global Majority (which successor shall also be reasonably acceptable to the

Issuer) and (ii) such successor Administrative Agent shall have agreed in

writing to be bound by the terms of this Agreement in the same manner as the

Administrative Agent is bound hereunder or as otherwise approved by the

Requisite Global Majority.  A copy of

any such appointment and the agreement executed by such successor

Administrative Agent shall be promptly sent to each of the Issuer, the Servicer

and the Indenture Trustee.

 

SECTION 12.         Action upon Termination; Resignation

or Removal.  Promptly upon the effective

date of termination of this Agreement pursuant to Section 11(a) of this

Agreement or the resignation or removal of the Administrative Agent pursuant to

Section 11(b) or (c) of this Agreement, respectively, the Administrative

Agent shall be entitled to be paid all fees and reimbursable expenses accruing

to it to the date of such termination, resignation or removal.  In the event of the resignation or removal

of the Administrative Agent pursuant to Section 11(b) or (c) of this Agreement,

respectively, the Administrative Agent shall cooperate with the Indenture

Trustee and take all reasonable steps requested to assist the Requisite Global

Majority and the Indenture Trustee in making an orderly transfer of the duties

of the Administrative Agent.

 

SECTION 13.         Notices.  Any notice, report or other communication

given hereunder shall be in writing and addressed as follows:

 

(a)           If to the Issuer, to:

 

Willis Engine Funding LLC

2320 Marinship Way

Sausalito, California 94965

Attention: 

Counsel

Fax:  (415)

331-0607

 

with a copy to:

the Servicer and

Gibson, Dunn & Crutcher LLP

333 South Grand Avenue

Los Angeles, CA 90071

Attention: 

Brian D. Kilb

Telephone:            (213) 229-7236

Fax:               (213) 229-7520

 

5

 

(b)           If to the Administrative Agent, to:

 

Barclays Bank PLC

200 Park Avenue

New York, New York

10166

Attn:  Asset Securitization Group

 

(c)           If to the Indenture Trustee, to:

 

The Bank of New

York

101 Barclay Street

8th Floor West

Asset Backed

Securities Unit

New York, New York

10286

Fax:  (212) 815-2493

 

(d)           If to the Servicer, to:

 

Willis Lease

Finance Corporation

2320 Marinship

Way, Suite 300

Sausalito,

California 94965

Attention:  Counsel

Fax:  415/331-0607

 

with a copy to:

 

Gibson, Dunn &

Crutcher LLP

333 South Grand

Avenue

Los Angeles, CA

90071

Attention:  Brian D. Kilb

Telephone:            (213) 229-7236

Fax:               (213) 229-7520

 

(e)           If to any Noteholder, at the address

set forth in the Note Register, or to such other address as any party shall

have provided to the other parties in writing. 

Any notice required to be in writing hereunder shall be deemed given if

such notice is mailed by certified mail, postage prepaid, or hand-delivered

(or, in the case of the Issuer or the Servicer, by internationally recognized

courier service) to the address of such party as provided above.

 

SECTION 14.         Amendments.  This Agreement may be amended from time to

time by the parties hereto, provided that any amendment must be accompanied by

the written consent of the Requisite Global Majority.  Prior to the execution of any amendment to this Agreement, the

Issuer will provide notice of any such amendment to each Rating Agency, if any.

 

SECTION 15.         Successors and Assigns.  This Agreement may not be assigned by the

Administrative Agent except to an Affiliate unless (i) such assignment is

previously consented to in writing by the Indenture Trustee (acting at the

direction of the Control Party of

 

6

 

each

Series), (ii) such assignee is reasonably acceptable to the Issuer, and (iii)

each Rating Agency, if any, shall have received prior notice of each such

assignment.

 

SECTION 16.         GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED IN

ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO

ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE

PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT

REGARD TO CONFLICTS OF LAW PRINCIPLES.

 

SECTION 17.         Consent to Jurisdiction.  Any legal suit, action or proceeding against

any of the parties hereto arising out of or relating to this Agreement, or any

transaction contemplated hereby, may be instituted in any federal or state

court in New York County, State of New York, and each of the parties hereto

hereby waives any objection which it may now or hereafter have to the laying of

venue of any such suit, action or proceeding, and, solely for the purposes of

enforcing this Agreement, each of the Issuer and the Servicer hereby

irrevocably submits to the non-exclusive jurisdiction of any such court in any

such suit, action or proceeding.  Each

of the Issuer and the Servicer hereby irrevocably appoints and designates

CT Corporation Systems, 1633 Broadway, New York, New York 10019, its true

and lawful attorney-in-fact and duly authorized agent for the limited purpose

of accepting service of legal process and the Issuer agrees that service of

process upon such party shall constitute personal service of such process on

such Person.  Each of the Issuer and the

Servicer shall maintain the designation and appointment of such authorized

agent until all amounts payable under this Agreement shall have been paid in

full.  If such agent shall cease to so

act, each of the Issuer and the Servicer shall immediately designate and

appoint another such agent satisfactory to the Administrative Agent and shall

promptly deliver to the Administrative Agent evidence in writing of such other

agent’s acceptance of such appointment.

 

SECTION 18.         Headings.  The section headings hereof have been

inserted for convenience of reference only and shall not be construed to affect

the meaning, construction or effect of this Agreement.

 

SECTION 19.         Counterparts.  This Agreement may be executed in

counterparts, each of which when so executed shall together constitute but one

and the same agreement.

 

SECTION 20.         Severability.  Any provision of this Agreement that is

prohibited or unenforceable under any applicable law, rule or regulation or

that would result in the imposition of any fine or adverse regulatory or other

consequence in any jurisdiction shall be ineffective to the extent thereof

without invalidating the remaining provisions hereof and any such prohibition

or unenforceability in any jurisdiction shall not invalidate or render

unenforceable such provision in any other jurisdiction.

 

SECTION 21.         Agreement Not to File Petition in

Bankruptcy.  The Administrative

Agent hereby agrees that it shall not institute against, or join any other

person in instituting against, the Issuer any bankruptcy, reorganization,

arrangement, insolvency or liquidation proceeding, or other proceeding under

any insolvency, bankruptcy or similar law of any

 

7

 

jurisdiction,

for one year and a day after the last date on which any Note of any Series was

Outstanding.

 

SECTION 22.         Binding Effect Third-Party

Beneficiaries.  This Agreement will

inure to the benefit of and be binding upon the parties hereto.

 

SECTION 23.         Merger and Integration.  Except as specifically stated otherwise

herein, this Agreement sets forth the entire understanding of the parties

relating to the subject matter hereof, and all prior understandings, written or

oral, are superseded by this Agreement. 

This Agreement may not be modified, amended, waived or supplemented

except as provided herein.

 

8

 

EXECUTION COPY

 

IN WITNESS WHEREOF, the parties have caused this

Administration Agreement to be duly executed and delivered as of the day and

year first above written.

 

	

   

  	

  WILLIS ENGINE FUNDING LLC, as Issuer

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ MONICA J. BURKE

  	

   

  
	

   

  	

   

  	

  Name: Monica J. Burke

  
	

   

  	

   

  	

  Title: Chief Financial Officer

  
	

   

  	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  BARCLAYS BANK PLC, as Administrative Agent

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ PIERRE DULEYRIE

  	

   

  
	

   

  	

   

  	

  Name: Pierre Duleyrie

  
	

   

  	

   

  	

  Title: Director

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  WILLIS LEASE

  FINANCE CORPORATION, as

  Servicer

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ DONALD A. NUNEMAKER

  	

   

  
	

   

  	

   

  	

  Name: Donald A. Nunemaker

  
	

   

  	

   

  	

  Title: Executive Vice President,

  
	

   

  	

   

  	

  Chief Operating Officer

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  THE BANK OF NEW

  YORK, not in its individual

  capacity but solely as Indenture Trustee

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ SCOTT J. TEPPER

  	

   

  
	

   

  	

   

  	

  Name: Scott J. Tepper

  
	

   

  	

   

  	

  Title: Assistant Vice PresidentExhibit

10.29

 

EXECUTION COPY

 

CLASS A NOTE PURCHASE

AGREEMENT

 

 

among

 

 

WILLIS ENGINE FUNDING

LLC,

as Issuer

 

 

WILLIS LEASE FINANCE

CORPORATION,

as Servicer

 

 

SHEFFIELD RECEIVABLES

CORPORATION,

as Class A Note Purchaser

 

 

and

 

 

BARCLAYS BANK PLC,

as Purchaser’s Agent

 

 

dated as of September 12,

2002

 

 

TABLE OF CONTENTS

 

	

  ARTICLE I

  
	

  DEFINITIONS

  
	

  SECTION 1.01.    Certain Defined Terms

  
	

  SECTION 1.02.    Other Definitional Provisions

  
	

   

  
	

  ARTICLE II

  
	

  PURCHASE AND

  SALE

  
	

  SECTION 2.01.    Sale and Delivery of the Class A Notes

  
	

  SECTION 2.02.    Acceptance and Custody of Series 2002-1 Class A Note

  
	

  SECTION 2.03.    Funding of Loans.

  
	

  SECTION 2.04.    The Initial Funding, Subsequent Fundings and Incremental

  Fundings

  
	

  SECTION 2.05.    Reduction of the Class A Maximum Limit

  
	

  SECTION 2.06.    Determination of Interest

  
	

  SECTION 2.07.    Payments, Computations, Etc.

  
	

  SECTION 2.08.    Increased Costs

  
	

  SECTION 2.09.    Increased Capital

  
	

  SECTION 2.10.    Taxes

  
	

   

  
	

  ARTICLE III

  
	

  CONDITIONS

  PRECEDENT TO OBLIGATION OF THE PURCHASER

  
	

  SECTION 3.01.    Conditions Precedent to Initial Purchase

  
	

  SECTION 3.02.    Conditions Precedent to All Fundings

  
	

  SECTION 3.03.    Conditions Precedent to Initial Funding and Each Incremental

  Funding

  
	

   

  
	

  ARTICLE IV

  
	

  REPRESENTATIONS AND

  WARRANTIES

  
	

  SECTION 4.01.    Representations and Warranties of the Issuer

  
	

  SECTION 4.02.    Representations and Warranties and Agreements of WLFC

  
	

   

  
	

  ARTICLE V

  
	

  REPRESENTATIONS

  AND WARRANTIES OF THE PURCHASER

  
	

  SECTION 5.01.    Organization

  
	

  SECTION 5.02.    Authority, etc

  
	

  SECTION 5.03.    Securities Act.

  
	

  SECTION 5.04.    Investment Company Act.

  
	

  SECTION 5.05.    Pledge to Liquidity Providers

  
	

   

  
	

  ARTICLE VI

  
	

  COVENANTS

  OF THE ISSUER

  
	

  SECTION 6.01.    Rating of Class A Note Purchaser’s Commercial Paper Notes

  
	

  SECTION 6.02.    Information from the Issuer

  
	

  SECTION 6.03.    Access to Information

  
	

  SECTION 6.04.    Security Interests; Further Assurances

  
	

  SECTION 6.05.    Covenants

  

 

i

 

	

  SECTION 6.06.    Securities Act

  
	

   

  
	

  ARTICLE VII

  
	

  MUTUAL COVENANTS AND

  AGREEMENTS

  
	

  SECTION 7.01.    Legal Conditions to Closing

  
	

  SECTION 7.02.    Expenses and Fees

  
	

  SECTION 7.03.    Mutual Obligations

  
	

   

  
	

  ARTICLE VIII

  
	

  INDEMNIFICATION

  
	

  SECTION 8.01.    Indemnification by the

  Issuer

  
	

  SECTION 8.02.    Procedure

  
	

  SECTION 8.03.    Defense of Claims

  
	

   

  
	

  ARTICLE IX

  
	

  THE

  PURCHASER’S AGENT

  
	

  SECTION 9.01.    Authorization and Action

  
	

  SECTION 9.02.    Purchaser’s Agent’s Reliance, Etc

  
	

  SECTION 9.03.    Purchaser’s Agent and Affiliate

  
	

  SECTION 9.04.    Indemnification

  
	

  SECTION 9.05.    Purchase Decision

  
	

  SECTION 9.06.    Successor Purchaser’s Agent

  
	

   

  
	

  ARTICLE X

  
	

  MISCELLANEOUS

  
	

  SECTION 10.01.  Amendments

  
	

  SECTION 10.02.  Notices

  
	

  SECTION 10.03.  No Waiver; Remedies

  
	

  SECTION 10.04.  Binding Effect; Assignability

  
	

  SECTION 10.05.  Provision of Documents and Information

  
	

  SECTION 10.06.  GOVERNING LAW; JURISDICTION

  
	

  SECTION 10.07.  No Proceedings.

  
	

  SECTION 10.08.  Execution in Counterparts

  
	

  SECTION 10.09.  No Recourse

  
	

  SECTION 10.10.  Limited Recourse

  
	

  SECTION 10.11.  Survival

  
	

  SECTION 10.12.  Third-Party Beneficiaries

  
	

  SECTION 10.13.  Appointment of Agent for Service of Process

  

 

ii

 

	

  SCHEDULES

  
	

   

  
	

  SCHEDULE

  1

  	

  Address

  for Delivery of Payments

  
	

   

  	

   

  
	

  SCHEDULE 2

  	

  Conditions Precedent to Initial Purchase

  
	

   

  
	

  EXHIBITS

  
	

   

  
	

  EXHIBIT A

  	

  Form of Loan Report

  

 

iii

 

CLASS A NOTE PURCHASE AGREEMENT (“Class A Note

Purchase Agreement”) dated as of September 12, 2002, among WILLIS ENGINE

FUNDING LLC (the “Issuer”), WILLIS LEASE FINANCE CORPORATION (the “Servicer”),

SHEFFIELD RECEIVABLES CORPORATION (the “Class A Note Purchaser”) and

BARCLAYS BANK PLC (the “Purchaser’s Agent”).

 

The parties hereto agree as follows:

 

ARTICLE I

DEFINITIONS

 

SECTION 1.01.  Certain Defined Terms.  Capitalized terms used herein without

definition shall have the meanings set forth in the Indenture (as defined

below), as applicable.  Additionally,

the following terms shall have the following meanings:

 

“Administration Agreement” means, the

Administration Agreement dated as of September 12, 2002, among the Issuer and

the Indenture Trustee, as the same may be amended, supplemented or otherwise

modified from time to time.

 

“Affected Person” means the Purchaser’s Agent,

each Owner, each Liquidity Provider, each Person providing credit support for

the Class A Note Purchaser’s Commercial Paper Notes, and each of their

respective Affiliates, successors and assigns.

 

“Base Indenture” means the Indenture dated as

of September 12, 2002, between the Issuer, as issuer, and the Indenture Trustee,

as indenture trustee.

 

“Class A Increased Costs” shall mean, with

respect to any Interest Accrual Period, an amount equal to the sum of (a) the

aggregate amount payable to all Affected Persons pursuant to Sections 2.08,

2.09 and 2.10 of this Agreement in respect of such Interest Accrual Period and

(b) the aggregate of such amounts with respect to prior Interest Accrual

Periods which remain unpaid.

 

“Class A Note Purchaser” means Sheffield

Receivables Corporation.

 

“Class A Notes” means $165,343,500 initial

principal amount of the Issuer’s Class A Notes dated

September 12, 2002.

 

“Class B Notes” means $18,371,500 initial

principal amount of the Issuer’s Class B Notes dated

September 12, 2002.

 

“Class B Note Purchase Agreement” means the

Class B Note Purchase Agreement, dated as of September 12, 2002,

among the Issuer, the Servicer, Barclays Bank PLC and Fortis Bank (Nederland)

N.V.

 

“Class B Note Purchasers” has the meaning

specified in the Class B Note Purchase Agreement.

 

 

“Collection Date” means the date following the

Termination Date on which the aggregate outstanding Class A Note Principal

Balance has been reduced to zero, the Class A Note Purchaser has received all

Interest and other amounts due to the Class A Note Purchaser in connection with

this Agreement and the Purchaser’s Agent has received all amounts due to it in

connection with this Agreement.

 

“Commercial Paper Notes” means any commercial

paper notes issued by the Class A Note Purchaser.

 

“Commitment Termination Date” means September

11, 2003 or such later date to which the Commitment Termination Date may be

extended (if extended) in the sole discretion of the Class A Note Purchaser in

accordance with the terms of Section 2.03(b) hereof.

 

“Deal Documents” means the Series 2002-1

Transaction Documents and each other document, agreement, certificate, schedule

or other writing entered into or delivered in connection with the foregoing, as

the same may be amended, supplemented, restated, replaced or otherwise modified

from time to time.

 

“Dollars” or “$” means the lawful

currency of the United States of America.

 

“Exchange Act” means the Securities Exchange

Act of 1934, as amended.

 

“Excluded Taxes”

has the meaning specified in Section 2.10(a) hereof.

 

“Federal Bankruptcy Code” means the bankruptcy

code of the United States of America codified in Title 11 of the United States

Code.

 

“Funding” means a funding by a Class A Note

Purchaser of a Loan to the Issuer pursuant to Article II.

 

“Funding Date” means as to the initial Funding,

the Closing Date, and as to any Incremental Funding, any Business Day that is

(i) at least one (1) calendar week following the immediately preceding

Funding Date and (ii) two (2) Business Days immediately following the

receipt by the Purchaser’s Agent of a written request by the Issuer to obtain a

Loan, such notice to be in the form of Exhibit A hereto and to conform

to requirements of Section 3.02 hereof.

 

“Governmental Actions” means any and all

consents, approvals, permits, orders, authorizations, waivers, exceptions,

variances, exemptions or licenses of, or registrations, declarations or filings

with, any Governmental Authority required under any Governmental Rules.

 

“Governmental Authority” means any nation or

government, any state or other political subdivision thereof, any central bank

(or similar monetary or regulatory authority) thereof, any entity exercising

executive, legislative, judicial, regulatory or administrative functions of or

pertaining to government, and any corporation or other entity owned or controlled,

through stock or capital ownership or otherwise by any of the foregoing.

 

2

 

“Governmental Rules” means any and all laws,

statutes, codes, rules, regulations, ordinances, orders, writs, decrees and injunctions,

of any Governmental Authority and any and all legally binding conditions,

standards, prohibitions, requirements and judgments of any Governmental

Authority.

 

“Increased Costs” has the meaning specified in

Section 2.08 hereof.

 

“Incremental Funding” means any Funding that

increases the aggregate outstanding Class A Note Principal Balance.

 

“Indemnified Party” has the meaning specified

in Section 8.01 hereof.

 

“Indenture” means the Base Indenture, as

supplemented by the Indenture Supplement, as the same may be amended and

supplemented from time to time.

 

“Indenture Supplement” means the Series 2002-1

Supplement dated as of September 12, 2002, between the Issuer and the Indenture

Trustee, as the same may be amended, supplemented or otherwise modified from

time to time.

 

“Indenture Trustee” means The Bank of New York,

as trustee under the Indenture.

 

“Interpretation” as used in Sections 2.08

and 2.09 hereof with respect to any law or regulation means the interpretation

or application of such law or regulation by any governmental authority

(including, without limitation, any entity exercising executive, legislative,

judicial, regulatory or administrative functions of or pertaining to

government), central bank, accounting standards board, financial services

industry advisory body or any comparable entity.

 

“Investment Company Act” means the United

States Investment Company Act of 1940, as amended.

 

“Issuer” means Willis Engine Funding LLC, a

Delaware limited liability company.

 

“Issuer Documents” has the meaning specified in

Section 4.01(ii) hereof.

 

“Liquidity Agreement” means the Revolving Asset

Purchase Agreement dated as of September 12, 2002, among the Class A Note

Purchaser, the Purchaser’s Agent and the additional Sheffield Purchasers, if

any, named therein, as the same may be amended, supplemented or otherwise

modified from time to time.

 

“Liquidity Providers” means the banks at any

time party to the Liquidity Agreement.

 

“Loan Request” means any request by the Issuer

pursuant to Section 2.04(b) and in the form of Exhibit A.

 

3

 

“Losses” has the meaning specified in Section

8.01 hereof.

 

“Notes” means the Class A Notes and the Class B

Notes.

 

“Other Taxes” means any present or future stamp

or documentary taxes or any other excise or property taxes, charges or similar

levies that arise from any payment or deposit required to be made hereunder,

under the Indenture or from the execution, delivery or registration of, or

otherwise with respect to, any of the foregoing.

 

“Owner” shall mean the Class A Note Purchaser

and each other Person (including a participant to the extent of its undivided

interest) that has purchased, or has entered into a commitment to purchase, the

Class A Note, or an interest therein, from the Class A Note Purchaser whether

pursuant to a Liquidity Agreement or otherwise.

 

“Purchase” means the initial purchase by the

Class A Note Purchaser of the Class A Note from the Issuer.

 

“Purchaser” means the Class A Note Purchaser.

 

“Purchaser’s Agent” means Barclays Bank PLC.

 

“Requirement of Law” means, as to any Person,

any law (statutory or common), treaty, rule or regulation or determination of

an arbitrator or of a Governmental Authority, in each case applicable to or

binding upon such Person or any of its property or to which such Person or any

of its property is subject.

 

“Section 2.10(a) Amount” has the meaning

specified in Section 2.10(a) hereof.

 

“Securities Act” means the Securities Act of

1933, as amended.

 

“Servicer” means Willis Lease Finance

Corporation.

 

“Sheffield Owners” means the Class A Note

Purchaser and the Sheffield Purchasers.

 

“Sheffield Purchasers” means each of the

purchasers from time to time party to the Liquidity Agreement.

 

“Taxes” has the meaning specified in Section 2.10(a)

hereof.

 

“Termination Date” means the earliest of (a)

the date of the occurrence of an Early Amortization Event and (b) the

Commitment Termination Date.

 

“Third Party Claim” has the meaning specified

in Section 8.02 hereof.

 

“UCC” means the Uniform Commercial Code as in

effect in the applicable jurisdiction.

 

“United States” means the United States of

America.

 

4

 

“WLFC Documents” has the meaning specified in

Section 4.02(i) hereof.

 

SECTION 1.02.  Other Definitional Provisions.

 

(a)           All

terms defined in this Class A Note Purchase Agreement shall have the defined

meanings when used in any certificate or other document made or delivered

pursuant hereto unless otherwise defined therein.

 

(b)           As

used herein and in any certificate or other document made or delivered pursuant

hereto or thereto, accounting terms not defined in Section 1.01, have the

meanings assigned to them in accordance with generally accepted accounting

principles in the United States.

 

(c)           The

words “hereof,” “herein” and “hereunder” and words of similar import when used

in this Class A Note Purchase Agreement shall refer to this Class A Note

Purchase Agreement as a whole and not to any particular provision of this Class

A Note Purchase Agreement; and Section, subsection, Schedule and Exhibit

references contained in this Class A Note Purchase Agreement are references to

Sections, subsections, Schedules and Exhibits in or to this Class A Note

Purchase Agreement unless otherwise specified.

 

ARTICLE II

PURCHASE AND SALE

 

SECTION 2.01.  Sale and Delivery of the Class A Notes.  In reliance on the representations,

warranties and agreements set forth in this Agreement and subject to the terms

and conditions herein set forth, the Issuer agrees to sell, transfer and

deliver to the Purchaser’s Agent on behalf of the Class A Note Purchaser on the

Closing Date,  the Class A Note with a maximum principal amount of

$180,000,000, which Class A Note shall be duly executed by the Issuer,

duly authenticated by the Indenture Trustee and registered in the name of the

Purchaser’s Agent on behalf of the Class A Note Purchaser.  The actual outstanding principal balance of

the Class A Note will be increased and decreased from time to time in

accordance with the terms hereof and of the Indenture Supplement.  The Class A Note will be delivered to

the Purchaser’s Agent against payment of the amount of the Loan related to the

initial Funding made pursuant to Section 2.04.

 

SECTION 2.02.  Acceptance and Custody of Series 2002-1

Class A Note.  On the Closing Date,

the Purchaser’s Agent shall take delivery of the Class A Note and maintain

custody thereof on behalf of the Class A Note Purchaser.

 

SECTION 2.03.  Funding of Loans.

 

(a)           On

the terms and conditions hereinafter set forth, the Issuer may, at its option,

request Loans from the Class A Note Purchaser. 

The Purchaser’s Agent may act on behalf of and for the benefit of the

Class A Note Purchaser in this regard. 

The Class A Note Purchaser shall fund Loans from time to time during the

period from the date hereof to but not including the Termination Date; provided,

however, that no Loan shall be funded under this Agreement unless on the

applicable Funding Date a Loan is funded under the Class B Note

 

5

 

Purchase

Agreement in an amount that is one-ninth (1/9) the amount of the Loan funded

under this Agreement.  Under no

circumstances shall the Class A Note Purchaser fund any Loan if after giving

effect to such Funding or Incremental Funding, the aggregate Class A Note

Principal Balance outstanding hereunder would (i) exceed the Class A

Note Commitment or (ii) exceed the product of (y) nine (9) and (z) the

aggregate Class B Note Principal Balance outstanding under the Class B Note Purchase

Agreement after giving effect to the Funding or Incremental Funding made

thereunder on the same date.

 

(b)           The

Issuer may, within 60 days, but no later than 45 days, prior to the then

existing Commitment Termination Date, by written notice to the Purchaser’s

Agent, make written request for the Class A Note Purchaser to extend the

Commitment Termination Date for an additional period of 364 days.  The Purchaser’s Agent will give prompt

notice to the Class A Note Purchaser and the Class B Note Purchasers of its

receipt of such request for extension of the Commitment Termination Date.  The Class A Note Purchaser shall make a

determination, in its sole discretion and after a full credit review, not more

than 30 days and not less than 15 days prior to the then applicable Commitment

Termination Date as to whether or not it will agree to extend the Commitment

Termination Date; provided, however, that the failure of the

Class A Note Purchaser to make a timely response to the Issuer’s request for

extension of the Commitment Termination Date shall be deemed to constitute a

refusal by the Class A Note Purchaser to extend the Commitment Termination

Date.  It shall be a condition to the

extension of the Commitment Termination Date that the commitment under the Class

B Note Purchase Agreement be extended to the same date.

 

SECTION 2.04. 

The Initial Funding and Incremental Fundings.

 

(a)           The

Class A Notes shall bear interest at the applicable Interest Rate as provided

in the Indenture.  Subject to the

conditions described in Sections 2.03, 3.01 and 3.02, as applicable, the

initial Funding and each Incremental Funding shall be made in accordance with

the procedures described in Section 2.04(b).

 

(b)           The

initial Funding and each Incremental Funding shall be made, after receipt by

the Class A Note Purchaser of a Loan Request delivered by the Issuer to the

Purchaser’s Agent at least two Business Days prior to such proposed Funding

Date and each such notice shall specify (i) the aggregate amount of such

initial Funding or Incremental Funding which amount must satisfy the applicable

minimum requirement set forth in the following sentence and (ii) the date

of such Funding or Incremental Funding. 

The Issuer shall deliver no more than two such notices in any calendar

month, and each amount specified in any such notice must satisfy the following

minimum requirements, as applicable, as a condition to the related

Funding:  (i) the initial Funding

shall be in an amount equal to $4,500,000 or an integral multiple of $9,000 in

excess thereof; (ii) each Incremental Funding hereunder shall be in an

amount equal to $900,000 or an integral multiple of $9,000 in excess thereof;

provided, however, that if such Incremental Funding is to be made hereunder at

a time when there are no outstanding Commercial Paper Notes issued in respect

of a Funding of $4,500,000 or an integral multiple of $9,000 in excess thereof,

then such Incremental Funding shall be in an amount equal to $4,500,000 or an

integral multiple of $9,000 in excess thereof. 

Each notice delivered by the Issuer pursuant to this Section 2.04 shall

be irrevocable.  Following receipt of

such notice, the initial Funding or Incremental Funding will be made by the

Class A Note Purchaser.  On the date

 

6

 

of such

Funding or Incremental Funding, as the case may be, the Class A Note Purchaser

shall, upon satisfaction of the applicable conditions set forth in Article III,

make available to the Issuer by wire transfer in immediately available funds,

at such bank or other location reasonably designated by Issuer in its Loan

Request given pursuant to this Section 2.04(b), an amount equal to the amount

of such Loan related to such initial Funding or Incremental Funding, as the

case may be.  Notwithstanding any other

provision of this Section 2.04(b), following the consummation of the Term

Securitization, the Class A Note Purchaser shall not be obligated to fund a

Loan under this Agreement and the Series 2002-1 Supplement until the Issuer and

the Class A Note Purchaser have agreed in writing regarding the Spread for such

Loan.

 

SECTION 2.05.  Reduction of the Class A Maximum Limit.  The Issuer may, upon at least five Business

Days’ notice to the Purchaser’s Agent, terminate in whole or reduce in part the

portion of the Class A Maximum Limit that exceeds the sum of the aggregate

Class A Note Principal Balance and interest accrued and to accrue thereon

through the date of payment; provided, however, that each partial

reduction of the Class A Maximum Limit shall be in an aggregate amount

equal to $900,000 or an integral multiple thereof; and provided further,

however, that each partial reduction of the Class A Maximum Limit shall

be accompanied by a partial reduction of the Class B Maximum Limit under the

Class B Note Purchase Agreement in an amount equal to one-ninth (1/9) the

amount of the partial reduction hereunder. 

Each notice of reduction or termination pursuant to this

Section 2.05 shall be irrevocable.

 

SECTION 2.06.  Determination of Interest.  The Purchaser’s Agent shall determine the

Interest (including unpaid Interest, if any, due and payable on a prior Payment

Date) on the Class A Notes to be paid on each Payment Date for the applicable

Interest Accrual Period and shall advise the Issuer and the Indenture Trustee

thereof prior to 2:00 p.m. (New York City time) on the related Determination

Date.

 

SECTION 2.07. 

Payments, Computations, Etc.

 

(a)           Unless

otherwise expressly provided herein, all amounts to be paid or deposited by the

Issuer or the Servicer hereunder shall be paid or deposited in accordance with

the terms hereof no later than 11:00 a.m. (New York City time) on the day when

due in lawful money of the United States in immediately available funds to an

account maintained by the Purchaser’s Agent as shown on Schedule 1 hereto, or

such other account designated from time to time by the Purchaser’s Agent.  The Issuer shall, to the extent permitted by

law, pay to the Class A Note Purchaser Default Interest at the Overdue Rate as

provided in the Indenture; provided, however, that such interest rate shall not

at any time exceed the maximum rate permitted by applicable law.  All computations of interest and other fees

hereunder shall be made on the basis of a year of 360 days for the actual

number of days (including the first but excluding the last day) elapsed.

 

(b)           Whenever

any payment hereunder shall be stated to be due on a day other than a Business

Day, such payment shall be made on the next succeeding Business Day, and such

extension of time shall in such case be included in the computation of payment

of Interest or any fee payable hereunder, as the case may be.

 

7

 

(c)           If

any Funding or Incremental Funding requested by the Issuer and approved by the

Class A Note Purchaser pursuant to Section 2.04, is not, for any reason

whatsoever related to a default or nonperformance by the Issuer, made or

effectuated, as the case may be, on the date specified therefor, the Issuer

shall indemnify the Class A Note Purchaser against any reasonable loss, cost or

expense incurred by the Class A Note Purchaser, including, without limitation,

any loss (excluding loss of anticipated profits), cost or expense incurred by

reason of the liquidation or reemployment of deposits or other funds acquired

by the Class A Note Purchaser to fund or maintain such Funding or Incremental

Funding, as the case may be, during such Interest Accrual Period.

 

SECTION 2.08. 

Increased Costs.  If due

to the introduction of or any change (including, without limitation, any change

by way of imposition or increase of reserve requirements) in or in the

Interpretation of any law or regulation or the imposition of any guideline or

request from any central bank or other Governmental Authority after the date

hereof reflecting such change, there shall be an increase in the cost to an

Affected Person of making or maintaining any investment in the Class A Note or

any interest therein or of agreeing to purchase or invest in the Class A Note

or any interest therein, as the case may be (other than by reason of any

Interpretation of or introduction of or change in laws or regulations relating

to Taxes or Excluded Taxes), such Affected Person shall promptly submit to the

Issuer, the Servicer and, if such Person is not the Purchaser’s Agent, the

Purchaser’s Agent, a certificate setting forth in reasonable detail, the

calculation of such increased costs incurred by such Affected Person.  In determining such amount, such Affected

Person may use any reasonable averaging and attribution methods, consistent

with the averaging and attribution methods generally used by such Affected

Person in determining amounts of this type. 

The amount of increased costs set forth in such certificate (which

certificate shall, in the absence of manifest error, be prima facie evidence as

to such amount) shall be included in the Class A Increased Costs for the

Interest Accrual Period immediately succeeding the date on which such

certificate was delivered (or if such certificate was delivered during the last

Interest Accrual Period, for such last Interest Accrual Period) and to the

extent remaining outstanding, each Interest Accrual Period thereafter until

paid in full.  The Purchaser’s Agent,

out of amounts received by it in respect of Class A Increased Costs for

Affected Persons for any Interest Accrual Period, shall pay such increased

costs to such Affected Persons; provided, however, that if the

amount so distributable in respect of the Class A Increased Costs is less than

the aggregate amount payable to all such Affected Persons pursuant to Sections

2.08, 2.09 and 2.10 hereof, the resulting shortfall shall be allocated among

such Affected Persons on a pro rata basis (determined by the amount owed to

each).

 

SECTION 2.09. 

Increased Capital.  If the

introduction of or any change in or in the Interpretation of any law or

regulation or the imposition of any guideline or request from any central bank

or other governmental authority reflecting such change after the date hereof

affects or would affect the amount of capital required or expected to be

maintained by any Affected Person, and such Affected Person determines that the

amount of such capital is increased as a result of (i) the existence of

the Class A Note Purchaser’s agreement to make or maintain an investment in the

Class A Note or any interest therein and other similar agreements or

facilities, or (ii) the existence of any agreement by Affected Persons to

make or maintain an investment in the Class A Note or any interest therein or to

fund any such investment and any other commitments of the same type, such

Affected Person shall promptly submit to the Issuer, the Servicer and, if such

Person is not the Purchaser’s Agent, the Purchaser’s Agent, a certificate

 

8

 

setting

forth in reasonable detail, the calculation of the additional amounts required

to compensate such Affected Person in light of such circumstances.  In determining such amount, such Affected

Person may use any reasonable averaging and attribution methods, consistent

with the averaging and attribution methods generally used by such Affected

Person in determining amounts of this type. 

The amount set forth in such certificate (which certificate shall, in

the absence of manifest error, be prima facie evidence as to such amount) shall

be included in the Class A Increased Costs for the Interest Accrual Period

immediately succeeding the date on which such certificate was delivered (or if

such certificate was delivered during the last Interest Accrual Period, for

such last Interest Accrual Period), and to the extent remaining outstanding,

each Accrual Period thereafter until paid in full.  The Purchaser’s Agent, out of amounts received by it in respect

of Class A Increased Costs for Affected Persons for any Interest Accrual

Period, shall pay such increased costs to such Affected Persons; provided,

however, that if the amount so distributable in respect of the Class A

Increased Costs is less than the aggregate amount payable to all such Affected

Persons pursuant to Sections 2.08, 2.09 and 2.10 hereof, the resulting

shortfall shall be allocated among such Affected Persons on a pro rata basis

(determined by the amount owed to each).

 

SECTION 2.10. 

Taxes.  (a) Any and all

payments and deposits required to be made under this Agreement, the Class A

Note or the Indenture by the Issuer or the Indenture Trustee to or for the

benefit of an Owner shall be made, to the extent allowed by law, free and clear

of and without deduction for any and all present or future taxes, levies,

imposts, deductions, charges or withholdings, and all liabilities with respect

thereto, now or hereafter imposed, levied, collected, withheld or assessed by

any Governmental Authority.  If, as a

result of any change in law, treaty or regulation or in the interpretation or

administration thereof by any governmental or regulatory agency or body charged

with the administration or interpretation thereof, or the adoption of any law,

treaty or regulation, any taxes, levies, imposts, duties, charges or fees are

required to be withheld from any amount payable to any Owner hereunder, the

amount so payable to such Owner shall be increased to the extent necessary to

yield to such Owner (after payment of all taxes, levies, imposts, duties, charges

or fees) the amount stated to be payable to such Owner hereunder (such increase

and any similar increase described in Section 2.10(d), a “Section 2.10(a)

Amount”); provided, however, that this sentence shall not apply

with respect to (i) income taxes (including, without limitation, branch

profits taxes, minimum taxes and taxes computed under alternative methods, at

least one of which is based on net income) and franchise taxes that are based

on income or any other tax upon or measured by income or gross receipts imposed

on any Owner, in each case, as a result of a present or former connection

(other than any connection arising out of the transactions contemplated by this

Agreement) between the jurisdiction of the government or taxing authority imposing

such tax and such Owner; (ii) any taxes, levies, imposts, duties, charges

or fees that would not have been imposed but for the failure by such Owner to

provide and keep current any certification or other documentation permitted by

applicable law to be delivered by such Owner and required to qualify for an

exemption from or reduced rate thereof; (iii) any taxes, levies, imposts,

duties, charges or fees imposed as a result of a change by any Owner of the

office through which the Class A Note or any interest therein hereunder is

acquired, accounted for or booked as a result of the sale, transfer or

assignment by any Owner of its interest hereunder, other than any such taxes,

levies, imposts, duties, charges or fees imposed as a result of any such change

or adoption occurring after any such Class A Note or interest therein is

acquired, accounted for or booked; (iv) taxes measured by income, gross

receipts, assets or capital of any Owner by the taxing authority of the

 

9

 

jurisdiction

where such Owner is organized, incorporated, managed, controlled or is

considered to be doing business or in which it maintains an office, branch or

agency (other than Taxes imposed on the gross amount of any payments made to

under this Agreement without regard to such place of origination or

incorporation, such management or control, the conduct of such business or the

maintenance of such office, branch or agency); (v) any Taxes imposed on such

Owner as a result of payments not related to this Agreement; and (vi) any

withholding tax with respect to any Owner (all such exclusions being

hereinafter called “Excluded Taxes” and all other taxes, levies, imposts,

duties, charges or fees being hereinafter called “Taxes”).  To the extent that any Owner actually

realizes a tax benefit on its income tax returns (whether by reason of a

deduction, credit or otherwise) (a “Tax Benefit”) for a given year that is

attributable to the payment by the Issuer or the Indenture Trustee of any such

Taxes on behalf of such Owner, such Owner shall reimburse the Issuer for the

amount of such Tax Benefit, it being understood that the taking of any action

to realize any Tax Benefit shall be within the sole discretion of such Owner;

provided, however, that for purposes of reimbursing the Issuer, such Owner

shall calculate the amount of the Tax Benefit realized that is attributable to

the Issuer’s or the Indenture Trustee’s payment of such Taxes on behalf of such

Owner as if such Owner realized or received such Tax Benefit pro rata with all

othe Tax Benefits available to it for such year.

 

(b)           Each

of the Issuer and, to the extent not prohibited by applicable law (including

the Code), each Owner agrees that, with respect to all Federal, state and local

income franchise taxes, it will treat the Class A Note as indebtedness.  Each Owner not organized under the laws of

the United States or a State thereof covenants that to the extent that it is

entitled to receive payments under this Agreement without deduction or withholding

of any United States federal income taxes (other than Withholding Taxes)

because such income is effectively connected with a United States trade or

business, it will continue to hold the Class A Note in connection with a United

States trade or business for so long as it is an Owner.

 

(c)           Any

Section 2.10(a) Amounts payable to an Owner hereunder shall be included in the

Class A Increased Costs (i) for the Interest Accrual Period in respect of

which the payment subject to withholding is made and (ii) to the extent

remaining outstanding, each Interest Accrual Period thereafter until paid in

full.  The Purchaser’s Agent, out of

amounts received by it in respect of Class A Increased Costs for Affected

Persons for any Interest Accrual Period, shall pay such increased costs to such

Affected Persons; provided, however, that if the amount so

distributable in respect of the Class A Increased Costs is less than the

aggregate amount payable to all such Affected Persons pursuant to Sections

2.08, 2.09 and 2.10 hereof, the resulting shortfall shall be allocated among

such Affected Persons on a pro rata basis (determined by the amount owed to

each).

 

(d)           If,

in connection with an agreement or other document providing liquidity support,

credit enhancement or other similar support to any Owner in connection with

this Agreement or the funding or maintenance of its interest in the Class A

Note or any interest therein hereunder, such Owner is required to compensate a

bank or other financial institution in respect of Taxes under circumstances

similar to those described in this Section 2.10, then the amounts payable to

such Owner hereunder shall be increased to the extent necessary to yield to

such Owner (after payment of all Taxes to such bank or other financial

institutions) the amount stated to be payable to such Owner hereunder.

 

10

 

ARTICLE III

CONDITIONS PRECEDENT TO OBLIGATION OF THE PURCHASER

 

SECTION 3.01.  Conditions Precedent to Initial Purchase.  The initial Purchase hereunder is subject to

the condition precedent that the Purchaser’s Agent shall have received on or

before the date of such purchase the items listed in Schedule 2, each

(unless otherwise indicated) dated such date, in form and substance

satisfactory to the Purchaser’s Agent and the Class A Note Purchaser.

 

SECTION 3.02.  Conditions Precedent to All Fundings.  Each Funding (including the initial Funding)

by the Class A Note Purchaser and each Incremental Funding (each, a

“Transaction”) shall be subject to the further conditions precedent that (a)

with respect to any Funding (including the initial Funding) or Incremental

Funding, the Servicer shall have delivered to the Purchaser’s Agent, on or

prior to the date of such Funding or Incremental Funding in form and substance

satisfactory to the Purchaser’s Agent, a Loan Request substantially in the form

of Exhibit A, and containing such additional information as may be

reasonably requested by the Purchaser’s Agent; (b) on the date of such

Transaction the following statements shall be true and the Issuer shall be

deemed to have certified that:

 

(i)            The representations and warranties

contained in Sections 4.01 and 4.02 are true and correct on and as of such day

as though made on and as of such date;

 

(ii)           No event has occurred and is

continuing, or would result from such Transaction which constitutes an Early

Amortization Event;

 

(iii)          On and as of such day, after giving

effect to such Transaction, the outstanding Class A Note Principal Balance does

not exceed the Class A Note Commitment and the outstanding Aggregate Note

Principal Balance does not exceed the the sum of the Class A Note

Commitment and the Class B Note Commitment;

 

(iv)          On and as of such day, the Issuer and

the Servicer each has performed all of the agreements contained in this

Agreement to be performed by such person at or prior to such day;

 

(v)           No law or regulation shall prohibit,

and no order, judgment or decree of any federal, state or local court or

governmental body, agency or instrumentality shall prohibit or enjoin, the

making of such Loan, remittance of collections or Incremental Funding by the

Class A Note Purchaser in accordance with the provisions hereof;

 

(vi)          McAfee & Taft shall have delivered

to the Purchaser’s Agent its written opinion, dated the applicable Transfer

Date, which shall state that it may be relied upon by subsequent Class A

Noteholders, in form and substance satisfactory to the Purchaser’s Agent and

the Class A Note Purchaser, with respect to FAA and recordation matters; and

 

(vii)         on the date of such Transaction, the

Purchaser’s Agent shall have received such other approvals, opinions or

documents as the Purchaser’s Agent may reasonably require.

 

11

 

SECTION 3.03.  Conditions Precedent to Initial Funding

and Each Incremental Funding.  The

initial Funding and each Incremental Funding are subject to the condition

precedent, in addition to the conditions precedent set forth in Section 3.02

hereof, that the Issuer shall have delivered, or shall have caused to be

delivered, to each designated recipient named in Schedule G to the Indenture

Supplement, each of the Funding Deliverables scheduled to be delivered

thereunder on or before the Funding Date of such Funding.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

 

SECTION 4.01.  Representations and Warranties of the

Issuer.  The Issuer represents (as

of the Effective Date and as of each date on which a Loan is made by a Class A

Noteholder pursuant to the Supplement, unless otherwise indicated) and warrants

to, and agrees with, the Class A Note Purchaser that:

 

(i)            The Issuer is a limited liability

company duly organized, validly existing and in good standing under the laws of

the State of Delaware, with its chief executive office located at 2320

Marinship Way, Suite 300, Sausalito, California 94965, and has the power to own

its assets and to engage in the activities in which it is presently engaged and

is duly qualified and in good standing under the laws of each jurisdiction

where its ownership of property or the conduct of its activities requires such

qualification, if the failure to so qualify would have a material adverse

effect on the financial condition of the Issuer or on the enforceability of the

Class A Note or the ability of the Issuer to perform its obligations under this

Agreement and the other Related Documents to which it is a party.  One hundred percent of the beneficial

ownership of the Issuer is owned by Willis Lease Finance Corporation (“WLFC”).  The Issuer has no subsidiaries other than

WLFC Funding (Ireland) Limited;

 

(ii)           The Issuer has the power, authority

and legal right to execute, deliver and perform its obligations under this

Agreement and the other Related Documents to which it is a party (collectively,

the “Issuer Documents”); the execution, delivery, and performance of the Issuer

Documents by the Issuer have been duly authorized by the Issuer by all

necessary action, the Issuer Documents, other than the Class A Note and the

Class B Notes, have been duly executed and delivered by the Issuer, and each of

the Class A Note and the Class B Notes, when issued in accordance with the

terms hereof and of the Indenture and the Supplement, will have been duly

executed and delivered;

 

(iii)          Each of the Issuer Documents (other

than the Class A Note), assuming due authorization, execution and delivery by

the other parties thereto, constitutes, and each of the Class A Note and the

Class B Notes, when issued and authenticated in accordance with the terms of

the Indenture, will constitute, a legal, valid and binding obligation of the

Issuer, enforceable against the Issuer in accordance with its terms, except

that such enforcement may be limited by (A) bankruptcy, insolvency,

reorganization, moratorium or other similar laws (whether statutory, regulatory

or decisional) now or hereafter in effect relating to creditors’ rights

generally and (B) general principles of equity (regardless of whether such

enforceability is considered in a proceeding in equity or at law);

 

12

 

(iv)          The consummation of the transactions

contemplated by the Issuer Documents and the fulfillment of the terms therein

will not conflict with or result in any breach of any of the terms and

provisions of or constitute (with or without notice, lapse of time or both) a

default under the certificate of formation or limited liability company

agreement of the Issuer, or any indenture, agreement, mortgage, deed of trust,

commitment letter or funding arrangement with any lending institution or

investment bank or other instrument to which the Issuer is a party or by which

it is bound, or result in the creation or imposition of any lien, claim or

encumbrance upon any of its properties pursuant to the terms of such indenture,

agreement, mortgage, deed of trust, commitment letter or funding arrangement

with any lending institution or investment bank or other such instrument, other

than as created pursuant to the Indenture and the Supplement, or violate any

law or, any order, rule or regulation applicable to the Issuer of any court or

of any federal or state regulatory body, administrative agency or other

governmental instrumentality having jurisdiction over the Issuer or any of its

properties and there are no legal or governmental proceedings pending or, to

the best knowledge of the Issuer, threatened or contemplated that would result

in a material modification or revocation thereof;

 

(v)           There are no litigation, proceedings

or investigations to which the Issuer, or any Affiliate of the Issuer, is a

party pending, or, to the knowledge of Issuer, threatened, before any court,

regulatory body, administrative agency or other tribunal or governmental

instrumentality (A) asserting the invalidity of the Class A Note or and the

Class B Notes or the other Issuer Documents, (B) seeking to prevent the

issuance of the Class A Note or the consummation of any of the transactions

contemplated by the other Issuer Documents, or (C) seeking any determination or

ruling that would materially and adversely affect the performance by the Issuer

of its obligations under, or the validity or enforceability of; the Class A

Note or and the Class B Notes or the other Issuer Documents;

 

(vi)          All approvals, authorizations,

consents, orders or other actions of any person, corporation or other

organization, or of any court, governmental agency or body or official,

required in connection with the execution and delivery of the Issuer Documents

by the Issuer and with the valid and proper authorization, issuance and sale of

the Class A Note and the Class B Notes pursuant to this Agreement, have been or

will be taken or obtained on or prior to the Effective Date;

 

(vii)         No written materials delivered to the

Class A Note Purchaser by or on behalf of the Issuer in connection with the sale

of the Class A Note contain any untrue statement of a material fact or omit a

material fact necessary to make the statements contained therein or herein not

misleading.  There is no fact peculiar

to the Issuer or any Affiliate of the Issuer or, to the knowledge of the

Issuer, any Lease Agreement, Lessee or Engine which the Issuer has not

disclosed to the Purchaser’s Agent in writing which materially adversely

affects or, so far as the Issuer can now reasonably foresee, will materially

adversely affect the ability of the Issuer to perform the transactions

contemplated hereby and by the other Related Documents;

 

13

 

(viii)        The List of Engines to be created as of

the Closing Date and each supplement thereto will be available to the

Purchaser’s Agent by the Issuer and will be complete as of the date thereof and

will include an accurate (in all material respects) description of the Engines;

 

(ix)           The representations and warranties

made by the Issuer in the Issuer Documents are true and correct in all material

respects and the Class A Note Purchaser shall be entitled to rely on such

representations and warranties;

 

(x)            Any taxes, fees and other

governmental charges payable by the Issuer in connection with the execution and

delivery of the Issuer Documents, the pledge of the Collateral to the Indenture

Trustee, and the execution, delivery and sale of the Class A Note and the Class

B Notes, have been paid;

 

(xi)           To the extent the Exchange Act may be

deemed to apply to the Class A Note and the Class B Notes and the Loans, none

of the transactions contemplated in the Issuer Documents (including, without

limitation thereof; the use of the proceeds from the sale of the Class A Note)

will violate or result in a violation of Section 7 of the Exchange Act, or any

regulations issued pursuant thereto;

 

(xii)          Concurrently with the execution and

delivery of this Agreement, the Issuer is executing no other note purchase

agreement with respect to the Class A Note;

 

(xiii)         The Issuer is not an “investment

company” within the meaning of the Investment Company Act of 1940, as amended;

 

(xiv)        For so long as the Series 2002-1 Class A

and Class B Notes are the only Notes outstanding under the Indenture, each of

the Indenture and the Supplement need not be qualified as an “indenture”

pursuant to the terms of the Trust Indenture Act of 1939, as amended;

 

(xv)         The Issuer has not taken and will not

take, directly or indirectly, any action, prohibited by Rules 101 and 102 under

Regulation M of the Securities and Exchange Commission in connection with the

offering of the Class A Note and the Class B Notes;

 

(xvi)        To the extent that the Securities Act

may be deemed to apply to the Class A Note and the Class B Notes and the

Loans, neither the Issuer nor any affiliate (as defined in Rule 501(b) of

Regulation D under the Securities Act (“Regulation D”)) of the Issuer has

directly, or through any agent, including, without limitation, the Purchaser’s

Agent, (i) sold, offered for sale, solicited offers to buy or otherwise

negotiated in respect of; any security (as defined in the Securities Act) which

is or will be integrated with the sale of the Class A Note and the Class B

Notes in a manner that would render the issuance and sale of the Class A Note

or the Class B Notes a violation of the Securities Act or require the

registration of the Class A Note or the Class B Notes under the Securities Act

or (ii) engaged in any form of general solicitation or general advertising

(within the meaning of Regulation D) in connection with the offering of the

Class A Note and the Class B Notes;

 

14

 

(xvii)       To the extent that the Securities Act may

be deemed to apply to the Class A Note and the Class B Notes and the

Loans, it is not necessary in connection with the offer, sale and delivery of

the Class A Note in the manner contemplated by this Agreement or the Class B

Notes in the manner contemplated by the Class B Note Purchase Agreement to

register the Class A Note or the Class B Notes under the Securities Act

assuming that the Class A Note Purchaser is an “accredited investor” as defined

in Regulation D under the Securities Act;

 

(xviii)      No event has occurred and is continuing

that constitutes, or with the passage of time or the giving of notice or both

would constitute, an Early Amortization Event under, and as defined in, the

Indenture.  The Issuer is not in

violation of any agreement, charter instrument, bylaw or other instrument to which

they are a party or by which they are or may be bound;

 

(xix)         The aggregate amount of Scheduled

Payments payable by the Lessees under the Lease Agreements during each

Collection Period is sufficient to pay the monthly Servicing Fee, and the

principal and interest on the Class A Note and the Class B Notes, as such

payments become due and payable, in accordance with the Indenture;

 

(xx)          The Issuer agrees that it will not

directly or indirectly, sell or offer to sell the Class A Note or the Class B

Notes or similar security in a manner that would render the issuance and sale

of the Class A Note or the Class B Notes pursuant to this Agreement a violation

of Section 5 of the Securities Act.

 

SECTION 4.02.  Representations and Warranties and

Agreements of WLFC.  WLFC hereby

represents (as of the Effective Date and as of each date on which a Loan is

made by a Class A Noteholder pursuant to the Indenture Supplement, unless

otherwise indicated) and warrants to, and agrees with, the Class A Note

Purchaser that:

 

(i)            The representations and warranties

made by WLFC in this Class A Note Purchase Agreement, the Class B Note Purchase

Agreement, the Guaranty, the Contribution and Sale Agreement, the Servicing

Agreement and any other Related Document to which it is a party (collectively,

the “WLFC Documents”) are true and correct in all material respects and the

Class A Note Purchaser shall be entitled to rely on such representations and

warranties;

 

(ii)           No written materials delivered to the

Class A Note Purchaser by or on behalf of WLFC in connection with the sale of

the Class A Note or the Class B Notes contain any untrue statement of a

material fact or omit a material fact necessary to make the statements

contained therein or herein not misleading. 

There is no fact peculiar to WLFC or any Affiliate of WLFC or, to the

knowledge of WLFC, any Lease Agreement, Lessee or Engine which WLFC had not

disclosed to the Purchaser’s Agent in writing which materially affects

adversely or, so far as WLFC can now reasonably foresee, will materially affect

adversely the ability of WLFC to perform the transactions contemplated hereby

and by the Base Indenture, the Indenture Supplement, the Servicing Agreement,

the Class A Note and the Class B Notes;

 

15

 

(iii)          Any taxes, fees and other governmental

charges payable by WLFC on or prior to the Effective Date in connection with

the execution and delivery of the WLFC Documents, have been, or will be, paid

on or prior to the Effective Date;

 

(iv)          To the extent that the Exchange Act

may be deemed to apply to the Class A Note and the Class B Notes and the

Loans, none of the transactions contemplated herein or in the Class B Note

Purchase Agreement (including, without limitation thereof; the use of the

proceeds from the sale of the Class A Note and the Class B Notes) will violate

or result in a violation of Section 7 of the Exchange Act or any regulations

issued pursuant thereto including, without limitation, Regulations T, U and X

of the Federal Reserve Board, 12 C.F.R., Chapter II.  WLFC will not use any distribution from the Issuer of proceeds

received by the Issuer from the sale of the Class A Note and the Class B Notes

to purchase or carry, directly or indirectly, margin stock;

 

(v)           No event has occurred and is

continuing that constitutes, or with the passage of time or the giving of

notice or both would constitute a Servicer Event of Default or an Early

Amortization Event under, and as defined in, the Servicing Agreement or the

Indenture, respectively.  WLFC is not in

violation in any material respect of any term of any agreement, charter

instrument, bylaw or other instrument to which it is a party or by which it is

or may be bound;

 

(vi)          The aggregate amount of Scheduled

Payments payable by the Lessees under the Lease Agreements during each

Collection Period is sufficient to cover the monthly Servicing Fee, and pay the

principal and interest on the Class A Note and the Class B Notes, as such

payments become due and payable, in accordance with the Indenture; and

 

(vii)         To the extent that the Securities Act

may be deemed to apply to the Class A Note and the Class B Notes and the

Loans, neither WLFC nor any affiliate (as defined in Rule 501(b) of Regulation

D) of WLFC has directly, or through any agent, including, without limitation, the

Purchaser’s Agent, (i) sold, offered for sale, solicited offers to buy or

otherwise negotiated in respect of; any security (as defined in the Securities

Act) which is or will be integrated with the sale of the Class A Note and the

Class B Notes in a manner that would render the issuance and sale of the Class

A Note or the Class B Notes a violation of the Securities Act or require the

registration of the Class A Note or the Class B Notes under the Securities

Act or (ii) engaged in any form of general solicitation or general

advertising (within the meaning of Regulation D) in connection with the

offering of the Class A Note and the Class B Notes.  It is not necessary in connection with the offer, sale and

delivery of the Class A Note and the Class B Notes to register the Class A Note

or the Class B Notes under the Securities Act.

 

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Class A Note Purchaser hereby makes the following

representations and warranties to the Issuer as of the Closing Date:

 

16

 

SECTION 5.01.  Organization.  The Class A Note Purchaser has been duly

organized and is validly existing and in good standing as a corporation under

the laws of its jurisdiction of incorporation, with power and authority to own

its properties and to transact the business in which it is now engaged, and the

Class A Note Purchaser is duly qualified to do business and is in good standing

in each State of the United States where the nature of its business requires it

to be so qualified.

 

SECTION 5.02.  Authority, etc.  The Class A Note Purchaser has all requisite

power and authority to enter into and perform its obligations under this Class

A Note Purchase Agreement and to consummate the transactions contemplated hereby.  The execution and delivery by the Class A

Note Purchaser of this Class A Note Purchase Agreement and the consummation by

the Class A Note Purchaser of the transactions contemplated hereby have been

duly and validly authorized by all necessary corporate action on the part of

the Class A Note Purchaser.  This Class

A Note Purchase Agreement has been duly and validly executed and delivered by

the Class A Note Purchaser and constitutes a legal, valid and binding

obligation of the Class A Note Purchaser, enforceable against the Class A Note

Purchaser in accordance with its terms, subject as to enforcement to

bankruptcy, reorganization, insolvency, moratorium and other similar laws of

general applicability relating to or affecting creditors’ rights and to general

principles of equity.  Neither the

execution and delivery by the Class A Note Purchaser of this Class A Note

Purchase Agreement nor the consummation by the Class A Note Purchaser of any of

the transactions contemplated hereby, nor the fulfillment by the Class A Note

Purchaser of the terms hereof, will conflict with, or violate, result in a

breach of or constitute a default under (i) any term or provision of the

Articles of Incorporation or By–laws of the Class A Note Purchaser or any

Governmental Rule applicable to the Class A Note Purchaser or (ii) any

term or provision of any indenture or other agreement or instrument, to which

the Class A Note Purchaser is a party or by which the Class A Note Purchaser or

any portion of its properties are bound.  No Governmental Action which has not been obtained is required by

or with respect to the Class A Note Purchaser in connection with the execution

and delivery of this Class A Note Purchase Agreement by the Class A Note

Purchaser or the consummation by the Class A Note Purchaser of the transactions

contemplated hereby or thereby.

 

SECTION 5.03. 

Securities Act.

 

(a)           The

Class A Notes purchased by the Purchaser’s Agent on behalf of the Class A Note

Purchaser pursuant to this Class A Note Purchase Agreement will be acquired for

investment only and not with a view to any public distribution thereof, and the

Class A Note Purchaser will not offer to sell or otherwise dispose of its Class

A Notes (or any interest therein) in violation of any of the registration requirements

of the Securities Act or any applicable state or other securities laws.  The Class A Note Purchaser acknowledges that

it has no right to require the Issuer to register the Class A Notes under the

Securities Act or any other securities law. The Class A Note Purchaser agrees

that the Class A Notes may not be reoffered, resold, pledged or otherwise

transferred except in compliance with the Securities Act and to a person that

the Class A Note Purchaser reasonably believes is a Qualified Institutional Buyer

within the meaning of  Rule 144A (a

“QIB”) purchasing for its own account or a QIB purchasing for the account of a

QIB, and whom the holder has informed, in each case, that the reoffer, resale

or pledge or other transfer is being made in reliance on Rule 144A under the

Securities Act.  Neither the Class A

 

17

 

Note

Purchaser nor any of its Affiliates nor any persons acting on their behalf have

engaged or will engage in any general solicitation or general advertising with

respect to the Class A Notes.

 

(b)           The

Class A Note Purchaser is aware of the following:  (i) there are significant restrictions on and conditions to

the transferability of the Class A Notes (and the Class A Notes will bear

legends referring to such restrictions) and there is no market for the Class A

Notes and no market is expected to develop for the Class A Notes, and

accordingly, it may not be possible for the Class A Note Purchaser to liquidate

the Class A Note Purchaser’s investment in the Class A Notes; (ii) no

governmental agency has made any findings as to the fairness of the terms of

this Agreement or the terms and conditions of the Class A Notes;

(iii) there are numerous risks and uncertainties involved in the Class A

Note Purchaser’s acquisition of the Class A Notes and the Class A Note

Purchaser has been advised of and understands such risks and uncertainties; and

(iv) any projections or predictions that may have been made available to

the Class A Note Purchaser are based on estimates, assumptions, and forecasts

which may prove to be incorrect; and no assurance is given that actual results

will correspond with the results contemplated by the various projections.

 

(c)           The

Class A Note Purchaser has knowledge and experience in financial and business

matters, is capable of evaluating the merits and risks of an investment in the

Class A Notes and has carefully considered the suitability of an investment in

such Notes and has determined that the Class A Notes are a suitable investment.  The Class A Note Purchaser has received and

carefully read the Transaction Documents and the Class A Note Purchaser

confirms that all documents, records and books pertaining to the Class A Notes,

the Issuer and its assets and the other parties to the Transaction Documents

which are relevant to the Class A Note Purchaser’s investment decision have

been made available to the Class A Note Purchaser.  The Class A Note Purchaser is capable of bearing the risks and

burdens of its investment in the Class A Notes and is aware that an early

redemption of the Class A Notes may occur and that no premium will be paid upon

any early redemption.

 

SECTION 5.04. 

Investment Company Act.

 

(a)           Neither

the Class A Note Purchaser nor the Purchaser’s Agent is required to register as

an “investment company” nor is the Class A Note Purchaser or the Purchaser’s

Agent controlled by an “investment company” within the meaning of the

Investment Company Act.

 

(b)           The

Class A Note Purchaser and the Purchaser’s Agent acknowledge that the Issuer

has not registered as an investment company under the Investment Company

Act.  In connection with the exclusion

of the Issuer from classification as an investment company under the Investment

Company Act, the Class A Note Purchaser represents that it constitutes no more

than seven “beneficial owners” of the Class A Notes for purposes of Section

3(c)(1) of the Investment Company Act. 

The Class A Note Purchaser further represents that:  (i) it is investing no more than 40% of

its assets in the Class A Notes; (ii) it was not formed for the purpose of

investing in the Class A Notes; (iii) (a) the shareholders, partners or

other holders of equity or beneficial interests in the Class A Note Purchaser

are not able to decide individually whether to acquire the Class A Notes or to

determine the extent of such acquisition and (b) it is not a defined

contribution or similar benefit plan that allows participants to determine

whether or how

 

18

 

much

will be invested in investments on their behalf; (iv) it is acquiring the

Class A Notes in a principal amount of not less than the minimum denominations

set forth in the Indenture; and (v) it is acquiring the Class A Notes for

investment and not for sale in connection with any distribution thereof.  The Class A Note Purchaser further

understands and agrees that it will not permitted to transfer any or all of the

Class A Notes or any interest therein unless the Issuer has consented to such

transfer and the transferee has delivered to the Issuer and the Indenture

Trustee an investment letter making representations and warranties

substantially the same as the foregoing representations and warranties in this

Section 5.04(b).  The Issuer will not

consent to any proposed transfer which, after giving effect to such proposed

transfer, would result in the Issuer’s outstanding securities being owned by

more than 100 beneficial owners for purposes of Section 3(c)(1) of the

Investment Company Act; and, except as provided in Section 5.05 of this

Agreement, it will not hold the Class A Notes for the benefit of any person or

account and it will be the sole beneficial owner of the Class A Notes for all

purposes and it will not sell participation interests therein or enter into any

arrangement pursuant to which any other person or account shall be entitled to

a beneficial interest in the Class A Notes.

 

SECTION 5.05.  Pledge to Liquidity Providers.  The Issuer recognizes the obligations of the

Class A Note Purchaser under the terms of the Liquidity Agreement and hereby

consents to the transfer of the Class A Notes to the Liquidity Providers when

required and in accordance with the terms of the Liquidity Agreement; provided

that each of the Liquidity Providers shall be a QIB, each Liquidity Provider

shall be only one beneficial owner of the Class A Notes for purposes of the

Investment Company Act and that the total number of Liquidity Providers shall

not at any time exceed 10, and each Liquidity Provider shall have delivered to

the Issuer and the Indenture Trustee on or before the later of the date hereof

and the date on which it first becomes a Liquidity Provider, an investment

letter making representations and warranties substantially identical to those

set forth in the form of Exhibit B to the Indenture.  If at any time the number of Liquidity Providers shall exceed

one, the Purchaser’s Agent shall notify the Issuer and the Indenture Trustee of

the additional Liquidity Providers and that each such  Liquidity Provider represents only one beneficial owner for the

purposes of the Investment Company Act. 

Transfers of the Class A Notes under the terms of the Liquidity

Agreement shall be subject to the terms of this Section 5.05, but shall not

otherwise be subject to the transfer restrictions set forth in the Indenture.

 

ARTICLE VI

COVENANTS OF THE ISSUER

 

SECTION 6.01.  Rating of Class A Note Purchaser’s

Commercial Paper Notes.  To the

extent that any rating provided with respect to the Class A Note Purchaser’s

Commercial Paper Notes by any rating agency is conditional upon the furnishing

of documents or the taking of any other action by the Issuer, the Issuer shall

take all reasonable actions to furnish such documents and take any such other

action.

 

SECTION 6.02.  Information from the Issuer.  So long as the Class A Note Purchaser shall

own the Class A Notes, the Issuer will furnish to the Class A Note Purchaser

and the Purchaser’s Agent:

 

19

 

(a)           a

copy of each certificate, report, statement, notice or other communication

(other than investment instructions) furnished by or on behalf of the Issuer to

the Indenture Trustee under the Indenture concurrently therewith, and promptly

after receipt thereof, a copy of each notice, demand or other communication

received by or on behalf of the Issuer under the Indenture;

 

(b)           such

other information, documents, records or reports respecting the Collateral or

the Issuer, as the Class A Note Purchaser or Purchaser’s Agent may from time to

time reasonably request without unreasonable expense to the Issuer;

 

(c)           such

publicly available information, documents, records or reports respecting the

Issuer or the condition or operations, financial or otherwise of the Issuer as

the Class A Note Purchaser or Purchaser’s Agent may from time to time

reasonably request;

 

(d)           as

soon as possible and in any event within five Business Days after the

occurrence thereof, notice of (i) the occurrence of any Event of Default,

(ii) the occurrence of any Early Amortization Event, (iii) any fact,

condition or event which, with the giving of notice or the passage of time or

both, would become an Event of Default, (iv) any fact, condition or event

which, with the giving of notice or the passage of time or both, would become a

Early Amortization Event, (v) the failure of the Issuer to observe any of

its material undertakings under the Deal Documents or (vi) any change in

the status or condition of the Issuer or the Servicer that would reasonably be

expected to adversely affect the Issuer’s or the Servicer’s ability to perform

its obligations under the Deal Documents; and

 

(e)           on

or before April 30 of each year, beginning April 30, 2003, the report required

to be delivered by the Servicer pursuant to Section 5.10 of the Servicing

Agreement.

 

SECTION 6.03.  Access to Information.  So long as the Class A Note Purchaser shall

own any Notes, the Issuer will, at any time and from time to time during

regular business hours, on reasonable notice to the Issuer, permit the Class A

Note Purchaser or the Purchaser’s Agent, or its agents or representatives to:

 

(a)           examine

all books, records and documents (including computer tapes and disks) in the

possession or under the control of the Issuer relating to the Collateral, and

 

(b)           visit

the offices and property of the Issuer for the purpose of examining the

materials described in clause (a) above.

 

Except as provided in Section 10.05 hereof, any information obtained by

the Class A Note Purchaser or the Purchaser’s Agent pursuant to this Section

6.03 shall be held in confidence by the Class A Note Purchaser or Purchaser’s

Agent unless such information (i) has become available to the public,

(ii) is required or requested by any Governmental Authority or in any

court proceeding, or (iii) is required by any Governmental Rule to be

disclosed or otherwise made available and, in the case of (ii) and (iii) such

disclosure shall be only to the extent required.

 

20

 

SECTION 6.04.  Security Interests; Further Assurances.  The Issuer will take all action necessary to

maintain the Indenture Trustee’s first priority perfected security interest in

the Collateral.

 

SECTION 6.05.  Covenants.  The Issuer will duly observe and perform each of its covenants

set forth in the Indenture.

 

SECTION 6.06.  Securities Act.  The Issuer agrees not to sell, offer for

sale or solicit offers to buy or otherwise negotiate in respect of any security

(as defined in the Securities Act) that would be integrated with the sale of

the Class A Note and the Class B Notes in a manner that would require the

registration under the Securities Act of the sale to the Class A Note Purchaser

and the Class B Note Purchasers of the Class A Note and the Class B Notes,

respectively.

 

ARTICLE VII

MUTUAL COVENANTS AND AGREEMENTS

 

SECTION 7.01.  Legal Conditions to Closing.  The Class A Note Purchaser, the Purchaser’s

Agent, the Issuer, and the Servicer will take all reasonable actions necessary

to comply promptly with all legal requirements which may be imposed on any of

them with respect to the Closing (including satisfaction of the conditions

contained in this Class A Note Purchase Agreement), and will promptly cooperate

with and furnish information to one another in connection with any such legal

requirements.  The Class A Note

Purchaser, the Purchaser’s Agent, the Issuer, and the Servicer will take all

reasonable action necessary to obtain (and will cooperate with one another in

obtaining) any consent, authorization, permit, license, franchise, order or

approval of, or any exemption by, any Governmental Authority or any other

Person, required to be obtained or made by it in connection with any of the

transactions contemplated by this Class A Note Purchase Agreement.

 

SECTION 7.02.  Expenses and Fees.  Subject to Section 10.10, except as

otherwise expressly provided herein, all costs and expenses incurred in

connection with the entering into this Class A Note Purchase Agreement and the

transactions contemplated hereby shall 

be paid by the Issuer.

 

SECTION 7.03.  Mutual Obligations.  On and after the date of this Class A Note

Purchase Agreement, the Class A Note Purchaser, the Purchaser’s Agent, the

Issuer and the Servicer will do, execute and perform all such other acts, deeds

and documents as the other party may from time to time reasonably require in

order to carry out the intent of this Class A Note Purchase Agreement.

 

ARTICLE VIII

INDEMNIFICATION

 

SECTION 8.01.  Indemnification by the Issuer.  The Issuer agrees to indemnify and hold

harmless the Class A Note Purchaser and the Purchaser’s Agent, the Sheffield

Purchasers (including any Persons who are participants with any such Sheffield

Purchasers) and any other Owners and any of their respective officers,

directors, employees, agents,

 

21

 

representatives,

assignees and Affiliates (each an “Indemnified Party”) against any and

all losses, claims, damages, liabilities or expenses (including legal and

accounting fees) (collectively, “Losses”), as incurred (payable promptly upon written

request), for or on account of or arising from or in connection with any breach

of any representation, warranty or covenant of the Issuer in this Class A Note

Purchase Agreement or in any certificate or other written material delivered

pursuant hereto; provided, however, that the Issuer shall not be so required to

indemnify any such Person or otherwise be liable to any such Person hereunder

for any Losses arising from such Person’s negligence, willful misconduct or bad

faith. Notwithstanding the foregoing, the Issuer shall not be liable for any

settlement of any proceeding effected without its written consent

 

SECTION 8.02.  Procedure.  In order for any Indemnified Party to be entitled to any

indemnification provided for under this Class A Note Purchase Agreement in

respect of, arising out of, or involving a claim made by any Person against the

Indemnified Party (a “Third Party Claim”), such Indemnified Party must notify

the Issuer in writing of the Third Party Claim within five Business Days of

receipt of a summons, complaint or other notice of the commencement of

litigation and within ten Business Days after receipt by such Indemnified Party

of any other written notice of the Third Party Claim.  Thereafter, the Indemnified Party shall deliver to the Issuer,

within a reasonable time after the Indemnified Party’s receipt thereof, copies

of all notices and documents (including court papers) received by the

Indemnified Party relating to the Third Party Claim.

 

SECTION 8.03.  Defense of Claims.  If a Third Party Claim is made against an

Indemnified Party, (a) the Issuer will be entitled to participate in the

defense thereof and, (b) if it so chooses, to assume the defense thereof

with counsel selected by the Issuer, provided that in connection with such assumption

(i) such counsel is not reasonably objected to by the Indemnified Party

and (ii) the Issuer first admits in writing its liability to indemnify the

Indemnified Party with respect to all elements of such claim in full.  Should the Issuer so elect to assume the

defense of a Third Party Claim, none of the Issuer will be liable to the

Indemnified Party for any legal expenses subsequently incurred by the

Indemnified Party in connection with the defense thereof.  If the Issuer elects to assume the defense of

a Third Party Claim, the Indemnified Party will (i) cooperate in all

reasonable respects with the Issuer in connection with such defense and

(ii) not admit any liability with respect to, or settle, compromise or

discharge, such Third Party Claim without the Issuer’s prior written

consent.  If the Issuer shall assume the

defense of any Third Party Claim, the Indemnified Party shall be entitled to

participate in (but not control) such defense with its own counsel at its own

expense.  If the Issuer does not assume

the defense of any such Third Party Claim, the Indemnified Party may defend the

same in such manner as it may deem appropriate, including settling such claim

or litigation after giving notice to the Issuer of such terms and, the Issuer

will promptly reimburse the Indemnified Party upon written request.

 

ARTICLE IX

THE PURCHASER’S AGENT

 

SECTION 9.01.  Authorization and Action.  Each Sheffield Owner hereby accepts the

appointment of Barclays Bank PLC, as Purchaser’s Agent hereunder, and

authorizes the Purchaser’s Agent to take such action as agent on its behalf and

to exercise such powers as are

 

22

 

delegated

to the Purchaser’s Agent by the terms hereof, together with such powers as are

reasonably incidental thereto.  The

Purchaser’s Agent reserves the right, in its sole discretion, to take any

actions, exercise any rights or remedies under this Class A Note Purchase

Agreement and any related agreements and documents.  Except for actions which the Purchaser’s Agent is expressly

required to take pursuant to this Class A Note Purchase Agreement or the

Revolving Asset Purchase Agreement the Purchaser’s Agent shall not be required

to take any action which exposes the Purchaser’s Agent to personal liability or

which is contrary to applicable law unless the Purchaser’s Agent shall receive

further assurances to its satisfaction from the Sheffield Owners of the

indemnification obligations under Section 9.04 hereof against any and all

liability and expense which may be incurred in taking or continuing to take

such action.  The Purchaser’s Agent

agrees to give to each Sheffield Owner prompt notice of each notice and

determination given to it by the Issuer, the Servicer and the Indenture

Trustee, pursuant to the terms of this Class A Note Purchase Agreement or the

Indenture.  Subject to Section 9.06

hereof, the appointment and authority of the Purchaser’s Agent hereunder shall

terminate upon the payment to (a) each Sheffield Owner of all amounts owing to

such Owner hereunder and (b) the Purchaser’s Agent of all amounts due

hereunder.

 

SECTION 9.02.  Purchaser’s Agent’s Reliance, Etc.  Neither the Purchaser’s Agent nor any of its

directors, officers, agents or employees shall be liable for any action taken

or omitted to be taken by it or them as Purchaser’s Agent under or in

connection with this Class A Note Purchase Agreement or any related agreement

or document, except for its or their own gross negligence or willful

misconduct.  Without limiting the

foregoing, the Purchaser’s Agent: 

(i) may consult with legal counsel, independent public accountants

and other experts selected by it and shall not be liable for any action taken

or omitted to be taken in good faith by it in accordance with the advice of

such counsel, accountants or experts; (ii) makes no warranty or

representation to any Sheffield Owner and shall not be responsible to any

Sheffield Owner for any statements, warranties or representations made by the

Issuer, the Servicer or the Indenture Trustee in connection with this Class A

Note Purchase Agreement; (iii) shall not have any duty to ascertain or to

inquire as to the performance or observance of any of the terms, covenants or

conditions of this Class A Note Purchase Agreement on the part of the Issuer, the

Servicer or the Indenture Trustee or to inspect the property (including the

books and records) of the Issuer, the Servicer or the Indenture Trustee;

(iv) shall not be responsible to any Sheffield Owner for the due

execution, legality, validity, enforceability, genuineness, sufficiency or

value of this Class A Note Purchase Agreement or any other instrument or

document furnished pursuant hereto; and (v) shall incur no liability under

or in respect of this Class A Note Purchase Agreement by acting upon any notice

(including notice by telephone), consent, certificate or other instrument or

writing (which may be by telex) believed by it in good faith to be genuine and

signed or sent by the proper party or parties.

 

SECTION 9.03.  Purchaser’s Agent and Affiliate.  Barclays Bank PLC and its Affiliates may

generally engage in any kind of business with the Issuer or the Servicer, any

of their respective Affiliates and any Person who may do business with or own

securities of the Issuer or the Servicer or any of its Affiliates, all as if

Barclays Bank PLC were not the Purchaser’s Agent and without any duty to

account therefor to the Sheffield Owners.

 

SECTION 9.04.  Indemnification.  Each Sheffield Owner severally agrees to

indemnify the Purchaser’s Agent (to the extent not reimbursed by the Issuer or

the Servicer),

 

23

 

from and

against any and all liabilities, obligations, losses, damages, penalties,

actions, judgments, suits, costs, or reasonable out-of-pocket expenses or disbursements

of any kind or nature whatsoever which may be imposed on, incurred by, or

asserted against the Purchaser’s Agent in any way relating to or arising out of

this Class A Note Purchase Agreement or any action taken or omitted by the

Purchaser’s Agent under this Class A Note Purchase Agreement; provided, that

(i) a Sheffield Owner shall not be liable for any portion of such

liabilities, obligations, losses, damages, penalties, actions, judgments,

suits, costs, expenses or disbursements resulting or arising from the

Purchaser’s Agent’s gross negligence or willful misconduct and (ii) a

Sheffield Owner shall not be liable for any amount in respect of any compromise

or settlement or any of the foregoing unless such compromise or settlement is

approved by the Class A Note Purchaser and the majority of the Sheffield

Purchasers (based on purchase commitments under the Revolving Asset Purchase

Agreement).  Without limitation of the

generality of the foregoing, each Sheffield Owner agrees to reimburse the Purchaser’s

Agent, promptly upon demand, for any reasonable out-of-pocket expenses

(including reasonable counsel fees) incurred by the Purchaser’s Agent in

connection with the administration, modification, amendment or enforcement

(whether through negotiations, legal proceedings or otherwise) of, or legal

advice in respect of rights or responsibilities under, this Class A Note

Purchase Agreement; provided, that no Sheffield Owner shall be responsible for

the costs and expenses of the Purchaser’s Agent in defending itself against any

claim alleging the gross negligence or willful misconduct of the Purchaser’s

Agent to the extent such gross negligence or willful misconduct is determined

by a court of competent jurisdiction in a final and non-appealable decision.

 

SECTION 9.05.  Purchase Decision.  Each Sheffield Owner acknowledges that it

has, independently and without reliance upon the Purchaser’s Agent, any other

Sheffield Owner or any of their respective Affiliates, and based on such

documents and information as it has deemed appropriate, made its own evaluation

and decision to enter into this Class A Note Purchase Agreement and to purchase

an interest in the Class A Notes.  Each

Sheffield Owner also acknowledges that it will, independently and without

reliance upon the Purchaser’s Agent, any other Sheffield Owner or any of their

respective Affiliates, and based on such documents and information as it shall

deem appropriate at the time, continue to make its own decisions in taking or

not taking action under this Class A Note Purchase Agreement or any related

agreement, instrument or other document.

 

SECTION 9.06.  Successor Purchaser’s Agent.  (a) The Purchaser’s Agent may resign at any

time by giving sixty days’ written notice thereof to the Sheffield Owners, the

Issuer, the Servicer and the Indenture Trustee.  Upon any such resignation, a majority of the Sheffield Owners

shall have the right to appoint a successor Purchaser’s Agent approved by the

Issuer (which approval will not be unreasonably withheld or delayed).  If no successor Purchaser’s Agent shall have

been so appointed by a majority of the Sheffield Owners and shall have accepted

such appointment, within sixty days after the retiring Purchaser’s Agent’s

giving of notice or resignation, then the retiring Purchaser’s Agent may, on

behalf of the Sheffield Owners appoint a successor Purchaser’s Agent.  If such successor Purchaser’s Agent is not

an Affiliate of Barclays Bank PLC, such successor Purchaser’s Agent shall be

subject to the Issuer’s prior written consent. 

Upon the acceptance of any appointment as Purchaser’s Agent hereunder by

a successor Purchaser’s Agent, such successor Purchaser’s Agent shall thereupon

succeed to and become vested with all of the rights, powers, privileges and

duties of the retiring Purchaser’s Agent, and the retiring Purchaser’s Agent

shall be discharged from its duties and obligations

 

24

 

under

this Class A Note Purchase Agreement. 

After any retiring Purchaser’s Agent’s resignation or removal hereunder

as Purchaser’s Agent, the provisions of this Article IX shall inure to its

benefit as to any actions taken or omitted to be taken by it while it was an

Purchaser’s Agent under this Class A Note Purchase Agreement.

 

ARTICLE X

MISCELLANEOUS

 

SECTION 10.01.  Amendments.  No amendment or waiver of any provision of this Class A Note

Purchase Agreement shall in any event be effective unless (i) the same

shall be in writing and signed by all of the parties hereto and (ii) each

rating agency then rating the Commercial Paper Notes shall have confirmed that

such amendment will not result in a reduction or withdrawal of its then

effective rating of the Commercial Paper Notes, and then such amendment, waiver

or consent shall be effective only in the specific instance and for the

specific purpose for which given.

 

SECTION 10.02.  Notices.  All notices and other communications provided for hereunder

shall, unless otherwise stated herein, be in writing (including telecopies) or

delivered by overnight courier service, as to each party hereto, at its address

set forth below or at such other address as shall be designated by such party

in a written notice to the other parties hereto.  All such notices and communications shall, when telecopied or

sent by overnight delivery service, be effective with respect to telecopy

notices, when the sending machine receives confirmation of the transmission,

and with respect to overnight delivery service when confirmed by signed

receipt.

 

If to the Class A Note

Purchaser:

 

Sheffield Receivables

Corporation

c/o Barclays Bank PLC

222 Broadway

New York, New York 10038

Attention:  Asset Securitization Group

Telephone No.  (212) 412-3266

Telecopier No.  (212) 412-6846

 

If to the Issuer:

 

Willis Engine Funding LLC

2320 Marinship Way

Suite 300

Sausalito, California

94965

Telephone No.  (415) 331-5281

Telecopier No.  (415) 331-5167

 

25

 

If to Purchaser’s Agent:

 

Barclays Bank PLC

222 Broadway

New York, New York 10038

Attention:  Asset Securitization Group

Telephone No.  (212) 412-3266

Telecopier No.  (212) 412-6846

 

SECTION 10.03.  No Waiver; Remedies.  No failure on the part of any party hereto

to exercise, and no delay in exercising, any right hereunder shall operate as a

waiver thereof; nor shall any single or partial exercise of any right hereunder

preclude any other or further exercise thereof or the exercise of any other

right.  The remedies herein provided are

cumulative and not exclusive of any remedies provided by law.

 

SECTION 10.04.  Binding Effect; Assignability.  This Class A Note Purchase Agreement shall

be binding upon and inure to the benefit of the Issuer, the Purchaser’s Agent

and the Class A Note Purchaser and their respective successors and assigns

(including any subsequent holders of the Class A Notes); provided, however,

that the Issuer shall not have the right to assign its rights hereunder or any

interest herein (by operation of law or otherwise) without the prior written

consent of the Class A Note Purchaser. 

The Issuer acknowledges that the Class A Note Purchaser may at any time

assign any and all of its rights hereunder to the Sheffield Owners.  This Class A Note Purchase Agreement shall

create and constitute the continuing obligation of the parties hereto in

accordance with its terms, and shall remain in full force and effect until such

time as all amounts payable with respect to the Class A Notes shall have been

paid in full.

 

SECTION 10.05.  Provision of Documents and Information.  The Issuer acknowledges and agrees that the

Class A Note Purchaser and the Purchaser’s Agent are permitted to provide to

the Sheffield Purchasers, the placement agents for the Class A Note Purchaser’s

Commercial Paper Notes, the rating agencies of the Class A Note Purchaser’s Commercial

Paper Notes and other liquidity and credit providers under the Class A Note

Purchaser’s Commercial Paper Note program, opinions, certificates, documents

and other information relating to the Issuer, the Indenture Trustee and the

Servicer and the Collateral delivered to the Class A Note Purchaser or

Purchaser’s Agent pursuant to this Class A Note Purchase Agreement.  In addition, the Issuer, the Indenture

Trustee and the Servicer agree that any successors or assignees of the Class A

Note Purchaser will be entitled to receive the same opinions, certificates,

documents and other information from the Issuer, the Indenture Trustee, the

Servicer and their respective agents and representatives as the Class A Note

Purchaser or Purchaser’s Agent under this Class A Note Purchase Agreement.  The Purchaser’s Agent agrees not to provide

any of the foregoing materials or information to any of the Sheffield

Purchasers, the other liquidity and credit providers under the Class A Note

Purchaser’s Commercial Paper Program or the dealers or placement agents of the

Class A Note Purchaser’s Commercial Paper Notes unless such party has agreed to

hold such materials or information in confidence in accordance with the

standard set forth in Section 6.03 hereof.

 

26

 

SECTION 10.06.  GOVERNING LAW; JURISDICTION.  THIS CLASS A NOTE PURCHASE AGREEMENT SHALL

BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW

YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS.  EACH OF THE PARTIES TO THIS CLASS A NOTE

PURCHASE AGREEMENT HEREBY AGREES TO THE JURISDICTION OF THE UNITED STATES

DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY APPELLATE COURT

HAVING JURISDICTION TO REVIEW THE JUDGMENTS THEREOF.  EACH OF THE PARTIES HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON

CONVENIENS AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY

OF THE AFOREMENTIONED COURTS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR

EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.

 

SECTION 10.07.  No Proceedings.

 

(a)           The

Issuer agrees that so long as any of the Class A Note Purchaser’s Commercial

Paper Notes shall be outstanding or there shall not have elapsed one year plus

one day since the last day on which any of the Class A Note Purchaser’s

Commercial Paper Notes shall have been outstanding, it shall not file, or join

in the filing of, a petition against the Class A Note Purchaser under the

Federal Bankruptcy Code, or join in the commencement of any bankruptcy,

reorganization, arrangement, insolvency, liquidation or other similar

proceeding against the Class A Note Purchaser.

 

(b)           Each

of the Class A Note Purchaser and the Purchaser’s Agent agrees that so long as

any of the Class A Notes shall be outstanding or there shall not have elapsed

one year plus one day since the last day on which any of the Class A Notes

shall have been outstanding, it shall not file, or join in the filing of, a

petition against the Issuer under the Federal Bankruptcy Code, or join in the

commencement of any bankruptcy, reorganization, arrangement, insolvency,

liquidation or other similar proceeding against the Issuer.

 

SECTION 10.08.  Execution in Counterparts.  This Class A Note Purchase Agreement may be

executed in any number of counterparts and by different parties hereto in

separate counterparts, each of which when so executed shall be deemed to be an

original and all of which when taken together shall constitute one and the same

agreement.

 

SECTION 10.09.  No Recourse.  The obligations of the Class A Note Purchaser or any Sheffield

Purchaser under this Class A Note Purchase Agreement, or any other agreement,

instrument, document or certificate executed and delivered by or issued by the

Class A Note Purchaser or any such Sheffield Purchaser or any officer thereof

are solely the corporate obligations of the Class A Note Purchaser or any such

Sheffield Purchaser.  No recourse shall

be had for payment of any fee or other obligation or claim arising out of or

relating to this Class A Note Purchase Agreement or any other agreement,

instrument, document or certificate executed and delivered or issued by the

Class A Note Purchaser or any Sheffield Purchaser or any officer thereof in

connection therewith, against any stockholder, employee, officer, director or

incorporator of the Class A Note Purchaser or any such Sheffield Purchaser.

 

27

 

SECTION 10.10.  Limited Recourse.  The obligations of the Issuer under this

Class A Note Purchase Agreement shall be payable only out of the Collateral and

the Class A Note Purchaser shall not look to any property or assets of the

Issuer, other than to the Collateral remaining after all obligations of the

Issuer under the Indenture are satisfied. To the extent that the proceeds of

the Collateral after application in accordance with the provisions of the

Indenture are insufficient to satisfy the obligations of the Issuer under the

Indenture and under this Agreement, the Issuer shall have no further obligation

in respect hereof and any remaining outstanding obligation shall be

extinguished.

 

SECTION 10.11.  Survival.  All representations, warranties, guaranties and indemnifications

(including the payment obligations in Section 9.04 hereof) contained in this

Class A Note Purchase Agreement and in any document, certificate or statement

delivered pursuant hereto or in connection herewith shall survive the sale and

transfer of the Class A Notes.

 

SECTION 10.12.  Third–Party Beneficiaries.  The parties hereto agree and acknowledge

that the Owners are and shall be third–party beneficiaries under this

Class A Note Purchase Agreement.

 

SECTION 10.13.  Appointment of Agent for Service of

Process.  The Issuer hereby appoints

CT Corporation Systems having an address at 1633 Broadway, New York, New York

10019 as its agent for service of process in the State of New York.

 

28

 

IN WITNESS WHEREOF, the parties have caused this Class

A Note Purchase Agreement to be executed by their respective officers thereunto

duly authorized, as of the date first above written.

 

	

   

  	

  WILLIS ENGINE FUNDING LLC

  
	

   

  	

    as Issuer,

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ MONICA J. BURKE

  	

   

  
	

   

  	

   

  	

  Name: Monica J. Burke

  
	

   

  	

   

  	

  Title: Chief Financial Officer

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  WILLIS LEASE FINANCE CORPORATION,

  
	

   

  	

    as

  Servicer,

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ DONALD A. NUNEMAKER

  	

   

  
	

   

  	

   

  	

  Name: Donald A. Nunemaker

  
	

   

  	

   

  	

  Title: Executive Vice President,

  
	

   

  	

   

  	

  Chief Operating Officer

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  SHEFFIELD RECEIVABLES CORPORATION,

  
	

   

  	

    as Class A

  Note Purchaser

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:  Barclays

  Bank PLC, as Attorney in Fact

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ JANETTE LIEU

  	

   

  
	

   

  	

   

  	

  Name: Janette Lieu

  
	

   

  	

   

  	

  Title: Associate Director

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  BARCLAYS BANK PLC,

  
	

   

  	

    as

  Purchaser’s Agent

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ PIERRE DULEYRIE

  	

   

  
	

   

  	

   

  	

  Name:  Pierre

  Duleyrie

  
	

   

  	

   

  	

  Title: Director

  
						

 

29

 

SCHEDULE

1

Account to which cash payments shall be made:

 

Barclays Bank PLC

ABA #: 

026-00-2574

Account Number: 

050-791-516

Account Name: 

Sheffield 4(2) Funding Account

Ref:  Willis

Engine Finance

Telephone: 

(212) 412-2932

Fax:  (212)

412-6846

e-mail: 

pierre.duleyrie@barcap.com

 

30

 

SCHEDULE

2

 

Conditions of the Class A

Note Purchaser’s Obligation. 

The Class A Note Purchaser’s obligation to make the initial Loan shall

be subject to the accuracy in all material respects of the representations and

warranties of the Issuer and WLFC in each of the Series 2002-1 Transaction

Documents, to the performance in all material respects by WLFC and the Issuer

of their respective obligations thereunder, to the satisfaction of all of the

conditions precedent set forth in Sections 5.1 and 5.2 of the Indenture

Supplement and to the following additional conditions:

 

(a)           All

of the respective representations and warranties of the Issuer under the Issuer

Documents and of WLFC under the WLFC Documents shall be true and correct in all

material respects as of the date made, and no event shall have occurred which,

with notice or the passage of time, would constitute an Event of Default under

the Indenture or an Early Amortization Event under the Indenture and each of

such Issuer Documents and WLFC Documents shall have been duly authorized,

executed and delivered and shall be in full force and effect;

 

(b)           Cooley

Godward LLP shall have delivered to the Purchaser’s Agent its written opinion,

dated the Closing Date, which shall state that it may be relied upon by

subsequent Class A Noteholders, in form and substance satisfactory to the

Purchaser’s Agent and the Class A Note Purchaser, with respect to the Deal

Documents;

 

(c)           Ray

Quinney & Nebeker shall have delivered to the Purchaser’s Agent its written

opinion, dated the initial Transfer Date, which shall state that it may be

relied upon by subsequent Class A Noteholders, in form and substance

satisfactory to the Purchaser’s Agent and the Class A Note Purchaser, with

respect to the Owner Trust Documents related to each Contributed Engine

conveyed on the initial Transfer Date;

 

(d)           Gibson,

Dunn & Crutcher LLP, counsel to the Issuer, shall have furnished to the

Purchaser’s Agent its written opinions, dated the Closing Date, in form and

substance satisfactory to the Purchaser’s Agent and the Class A Note Purchaser;

 

(e)           Gibson,

Dunn & Crutcher LLP, counsel for WLFC and the Issuer, shall have delivered

to the Purchaser’s Agent its written opinions, dated the Closing Date, in form

and substance satisfactory to the Purchaser’s Agent and the Class A Note

Purchaser;

 

(f)            Emmet,

Marvin & Martin, counsel to the Indenture Trustee, shall have furnished to

the Purchaser’s Agent and to the Issuer its written opinion, dated the Closing

Date, in form and substance satisfactory to the Purchaser’s Agent and the Class

A Note Purchaser;

 

(g)           The

Issuer shall have furnished to the Purchaser’s Agent on the Closing Date a

certificate, dated the Closing Date, signed by an authorized officer, to the

effect that:

 

(i)            The representations and warranties

made by the Issuer in the Issuer Documents are true and correct in all material

respects on the Closing Date;

 

 

(ii)           The Issuer has complied with all of

the agreements and satisfied all the conditions on its part to be performed or

satisfied on or prior to the Closing Date pursuant to the terms of the Issuer

Documents; and

 

(iii)          The written information supplied by

the Issuer to the Class A Note Purchaser (other than projections and other

estimates) did not contain any untrue statement of a material fact, and any

estimates or projections so supplied to the Class A Note Purchaser were based

on assumptions which the Issuer believed to be reasonable (except as otherwise

disclosed therein).

 

(h)           WLFC

shall have furnished to the Purchaser’s Agent on the Closing Date a

certificate, dated the Closing Date, signed by an authorized officer, to the

effect that:

 

(i)            The representations and warranties

made by WLFC in the WLFC Documents are true and correct in all material

respects on the Closing Date;

 

(ii)           WLFC has complied with all of the

agreements and satisfied all the conditions on its part to be performed or

satisfied on or prior to the Closing Date pursuant to the terms of the WLFC

Documents; and

 

(iii)          The written factual information

supplied by WLFC to the Class A Note Purchaser (other than projections and

other estimates) did not contain any untrue statement of a material fact in

light of the circumstances under which they were made, and any estimates or

projections so supplied to the Class A Note Purchaser were based on assumptions

which WLFC believed to be reasonable (except as otherwise disclosed therein);

 

(i)            Any

taxes, fees and other governmental charges which are due and payable prior to

the Effective Date and the Closing Date by WLFC or the Issuer in connection

with the execution, delivery and performance of the Issuer Documents and WLFC

Documents shall have been paid at or prior to the Effective Date or the Closing

Date, as the case may be;

 

(j)            As

of the related Transfer Date, the Issuer has good title to, and is the sole

owner of, the Collateral, free and clear from any Lien except for the rights of

the Lessees under the Lease Agreements and the Lien of the Indenture Trustee

and, if applicable, the Owner Trustee, and shall not have assigned to any

Person other than the Indenture Trustee or, if applicable, the Owner Trustee,

any of its right, title or interest in the Lease Agreements, the Engines or any

other Transferred Assets;

 

(k)           The

Indenture Trustee or its agent shall have received, to be held in trust

pursuant to the Indenture and the Indenture Supplement, the Transferred Assets

including the Lease Agreements and all documents, instruments and other assets

required by the Indenture and the Indenture Supplement to be delivered to the

Indenture Trustee with respect thereto as of the Closing Date and as of each

related Transfer Date, as applicable;

 

(l)            No

fact or condition shall exist under applicable law or applicable regulations

thereunder or interpretations thereof by any regulatory authority which in the

Class A Note Purchaser’s reasonable opinion would make it illegal for the

Issuer to issue and sell the

 

2

 

Class A Note or for the Issuer or any of the other parties thereto to

perform their respective obligations under any Related Document;

 

(m)          The

Asset Base as of the Closing Date shall be not less than the Outstanding

Obligation and the Senior Asset Base as of the Closing Date shall be not less

than the Outstanding Obligations in respect of the Class A Note;

 

(n)           The

Issuer, WLFC, the Class A Note Purchaser and the Indenture Trustee shall each

have received a fully executed counterpart original and any required conformed

copies of all Related Documents delivered at or prior to the Closing Date;

 

(o)           All

corporate, trust and other proceedings in connection with the sale of the Class

A Note and the transactions contemplated hereby and all documents and

certificates incident thereto shall be satisfactory in form and substance to

the Class A Note Purchaser and its counsel, and the Class A Note Purchaser

shall have received such other documents and certificates incident to such

transaction as the Class A Note Purchaser or such counsel shall reasonably

request;

 

(p)           WLFC

shall have furnished to the Class A Note Purchaser or to the Purchaser’s Agent

(a) a consolidated statement of income of WLFC for the fiscal quarter ended

June 30, 2002 and a consolidated balance sheet of WLFC dated as of June 30,

2002, each of which shall be in form and substance satisfactory to the Class A

Note Purchaser and the Purchaser’s Agent, and (b) from the independent

accounting firm which regularly audits WLFC’s financial statements, a

consolidated statement of income of WLFC for the fiscal year ended December 31,

2001 and a consolidated balance sheet of WLFC dated as of December 31, 2001,

each of which shall be in form and substance satisfactory to the Class A Note

Purchaser and the Purchaser’s Agent and be certified by such accounting firm to

fairly present the financial condition of WLFC, to have been prepared in

accordance with Generally Accepted Accounting Principles applied on a basis

consistent with that of the preceding fiscal year and to have been based upon

an audit by such accounting firm made in accordance with generally accepted

auditing standards;

 

(q)           The

Class A Note Purchaser or the Purchaser’s Agent shall have received the

following, in each case in form and substance satisfactory to them and their

special counsel:

 

(i)            a copy of resolutions of the Board

of Directors of the Issuer, certified by the Secretary or an Assistant

Secretary of the Issuer as of the Effective Date, duly authorizing the issuance,

sale and delivery of the Class A Note by the Issuer and the execution, delivery

and performance by the Issuer of the Issuer Documents and any other Related

Documents to which it is a party and any other documents executed by or on

behalf of the Issuer in connection with the transactions contemplated hereby;

and an incumbency certificate of the Issuer as to the person or persons

executing and delivering each such document;

 

(ii)           a copy of resolutions of the Board of

Directors of WLFC, certified by the Secretary or an Assistant Secretary of WLFC

as of the Effective Date, duly authorizing the execution, delivery and

performance by WLFC of the WLFC Documents

 

3

 

and any other Related Documents to which it is a party

and any other documents executed by or on behalf of WLFC in connection with the

transactions contemplated hereby; and an incumbency certificate of WLFC as to

the person or persons executing and delivering each such document; and

 

(iii)          such other documents and evidence with

respect to WLFC, the Issuer and the Indenture Trustee as the Class A Note

Purchaser may reasonably request in order to establish the corporate existence

and good standing of each thereof; the proper taking of all appropriate corporate

proceedings in connection with the transactions contemplated hereby and the

compliance with the conditions set forth herein; and

 

(r)            The

Class A Note Purchaser shall receive on or before the Closing Date and each

Transfer Date, as the case may be, evidence that UCC-1 financing statements and

FAA recordations set forth in Section 2.03 of the Contribution and Sale

Agreement have been filed in the appropriate filing offices, reflecting the

interest of the Issuer and the Indenture Trustee in the Collateral;

 

(s)           [Reserved];

 

(t)            No

action or proceeding shall have been instituted nor shall any governmental

action be threatened before any court or government agency nor shall any order,

judgment or decree have been issued or proposed to be issued by any court or

governmental agency to set aside, restrain, enjoin or prevent the performance

of the Contribution and Sale Agreement, the Indenture, the other Related

Documents or any of the other agreements or the transactions contemplated

hereby;

 

(u)           [Reserved];

 

(v)           All

actions, approvals, consents, waivers, exemptions, variances, franchises,

orders, permits, authorizations, rights and licenses required to be taken,

given or obtained by or from any Federal, state or other governmental authority

or agency, or by or from any trustee or holder of any indebtedness or

obligation of WLFC or the Issuer, or that are necessary or, in the opinion of

the Class A Note Purchaser’s special counsel, advisable in connection with the

transactions contemplated herein shall have been delivered to the Class A Note

Purchaser.

 

4

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