Document:

Ex1040LeaseholdMortgage

Exhibit 10.40

Execution Copy

THIS INSTRUMENT WAS PREPARED BY
AND UPON RECORDING RETURN TO:

James S. Hogg, Esq.
Brouse McDowell LPA
388 South Main St., Ste. 500
Akron, OH 44311

Re:      Air Transport International Limited Liability Company
Loan No. _________
____________________
______________, OH  ________  
CLINTON COUNTY

[SPACE ABOVE FOR RECORDER’S USE ONLY]

LEASEHOLD MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT and FINANCING STATEMENT

THIS LEASEHOLD MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT and FINANCING STATEMENT (herein sometimes called "Mortgage") is made as of December 1, 2012, by and between the undersigned Mortgagor (herein, together with its successors and assigns, the "Mortgagor") and The Director of Development Services Agency of the State of Ohio (herein, together with its successors and assigns, called the "Mortgagee").

RECITALS

A.    The Mortgagor, AIR TRANSPORT INTERNATIONAL LIMITED LIABILITY COMPANY, a Nevada limited liability company, has entered into that certain Guaranty Agreement in favor of Mortgagee (said Agreement, as it may hereafter be amended, modified, supplemented, extended, renewed or replaced from time to time, being the “Guaranty” or the "Agreement"; the terms defined therein and not otherwise defined herein being used herein as therein defined).

B.    Pursuant to the Agreement and subject to the terms and conditions therein set forth, the Mortgagor has agreed to guaranty (a) certain obligations under that certain Loan and Security Agreement and any other Loan Documents between Mortgagee and Clinton County Port Authority dated as of December 1, 2012 and (b) payment of the State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund), Series 2012-9 (Clinton County Port Authority –AMES Project) (Tax-Exempt Bonds) issued by the State of Ohio (such guaranteed amounts being referred to as the “Guaranteed Obligations”).

C.    The aggregate principal amount outstanding from time to time under the Guaranteed Obligations may not exceed $14,685,000, excluding advances made to protect the lien and security of this Mortgage.

D.    To evidence and secure such obligations, Mortgagor has executed and delivered the Agreement and certain other Loan Documents.

E.    It has been agreed that as a condition precedent to the making of advances under the Loan and Security Agreement, Mortgagor will further secure such indebtedness by the execution and delivery of the Agreement and this Mortgage.

F.    As used in this Mortgage, the term "Secured Obligations" means and includes all of the following:  (i) all performance and payment obligations of the Mortgagor under or in connection with the Agreement or any of the other Loan Documents and (ii) all other obligations of the Mortgagor, to the Mortgagee, in each case howsoever created, arising or evidenced, whether direct or indirect, joint or several, absolute or contingent, or now or hereafter existing, or due or to become due, including, without limitation, those obligations arising out of or in connection with the Agreement, this Mortgage or any of the other Loan Documents, including, without limitation, any and all advances, costs or expenses paid or incurred by the Mortgagee to protect any or all of the Collateral (hereinafter defined) and other collateral under the Loan Documents, to perform any obligation of the Mortgagor hereunder or under any of the other Loan Documents or collect any amount owing to the Mortgagee which is secured hereby or under the other Loan Documents; interest on all of the foregoing; and all costs of enforcement and collection of this Mortgage, the Loan Documents and the Secured Obligations.

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G.    For purposes of this Mortgage, the term "Collateral" means and includes all right, title and interest of the Mortgagor in and to all of the following:

(i)    Mortgagor’s leasehold interest in all of the land described on Exhibit A attached hereto (the "Land"), together with Mortgagor’s interest, if any, in all and singular the tenements, rights, easements, hereditaments, rights of way, privileges, liberties, appendages and appurtenances now or hereafter belonging or in anywise appertaining to the Land (including, without limitation, all rights relating to storm and sanitary sewer, water, gas, electric, railway and telephone services); Mortgagor’s interest, if any, in all development rights, air rights, water, water rights, water stock, gas, oil, minerals, coal and other substances of any kind or character underlying or relating to the Land; all estate, claim, demand, right, title or interest of the Mortgagor in and to any street, road, highway, or alley (vacated or otherwise) adjoining the Land or any part thereof; Mortgagor’s interest, if any, in all strips and gores belonging, adjacent or pertaining to the Land; and Mortgagor’s interest, if any, in any after-acquired title to any of the foregoing (all of the foregoing is herein referred to collectively as the "Real Estate"); 

(ii)    All present and future rights, title and interests of the Mortgagor, however acquired, in, to, and under the lease and sublease(s) described on Exhibit B hereto (as amended, renewed and extended from time to time together with any new lease of the Real Estate or Improvements entered into by the Mortgagor in replacement, extension or renewal of or substitution for said lease, the "Facility Lease"), all present and future right, title and interest of the Mortgagor, as lessee or otherwise in and to the Real Estate, the Improvements (hereinafter defined), the Goods (hereinafter defined), and any other real or personal property (collectively the "Leased Property") which is subject to the Facility Lease or which is created under or pursuant to the Facility Lease and all present and future amendments, renewals and supplements thereto, including all of Mortgagor's unexpired estate, title, interest and term of years in the Leased Property by virtue of the Facility Lease and any and all credits, deposits, options to renew or extend, options to purchase, rights of first refusal, and any other rights and privileges of the Mortgagor thereunder (all of the foregoing are herein referred to collectively as the "Leasehold Estate");

(iii)    All buildings, structures, replacements, furnishings, fixtures, fittings and other improvements and property of every kind and character now or hereafter located or erected on the Real Estate and owned or leased or purported to be owned or leased by the Mortgagor, together with all building or construction materials, equipment, appliances, machinery, fittings, apparatus, fixtures and other articles of any kind or nature whatsoever now or hereafter found on, affixed to or attached to the Real Estate and owned or leased or purported to be owned or leased by the Mortgagor, including (without limitation) all trees, shrubs and landscaping materials, reels, and all heating, venting, electrical, lighting, power, plumbing, air conditioning, refrigeration and ventilation equipment (all of the foregoing is herein referred to collectively as the "Improvements");

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(iv)    All furniture, furnishings, equipment (including, without limitation, telephone and other communications equipment, office and record keeping equipment, window cleaning, building cleaning, signs, monitoring, garbage, air conditioning, computers, point of sale devices, drive-through equipment and other equipment), inventory and goods  and all other tangible property of any kind or character now or hereafter owned or purported to be owned by the Mortgagor and used or useful in connection with the Real Estate, regardless of whether located on the Real Estate or located elsewhere including, without limitation, all rights of the Mortgagor under any lease to equipment, furniture, furnishings, fixtures and other items of personal property at any time during the term of such lease below (all of the foregoing is herein referred to collectively as the "Goods"); 

(v)    All goodwill, trademarks, trade names, option rights, purchase contracts, condemnation claims, demands, awards and settlement payments, insurance contracts, insurance payments and proceeds, unearned insurance premiums, warranties, guaranties, utility deposits, books and records and general intangibles of the Mortgagor relating to the Real Estate or the Improvements and all accounts, contract rights, instruments, chattel paper and other rights of the Mortgagor for payment of money to it for property sold or lent by it, for services rendered by it, for money lent by it, or for advances or deposits made by it (including, without limitation, any deposits made by the Mortgagor pursuant to Section 1.19), and any other intangible property of the Mortgagor related to the Real Estate or the Improvements (all of the foregoing is herein referred to collectively as the "Intangibles");  

(vi)    All rents, issues, profits, royalties, avails, income and other benefits derived or owned by the Mortgagor directly or indirectly from the Real Estate or the Improvements (all of the foregoing is herein collectively called the "Rents");

(vii)    All rights of the Mortgagor under all subleases, licenses, occupancy agreements, concessions or other arrangements, whether written or oral, whether now existing or entered into at any time hereafter, whereby any Person agrees to pay money to the Mortgagor or any consideration for the use, possession or occupancy of, or any estate in, the Real Estate or the Improvements or any part thereof, and all rents, income, profits, benefits, avails, advantages and claims against guarantors under any thereof (all of the foregoing is herein referred to collectively as the "Leases");

(viii)    All rights of the Mortgagor, if any, to plans and specifications, designs, drawings and other matters prepared in connection with the Real Estate (all of the foregoing is herein called the "Plans");

(ix)    All rights of the Mortgagor, if any, under any contracts executed by the Mortgagor with any provider of goods or services for or in connection with any construction undertaken on, or services performed or to be performed in connection with, the Real Estate 

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or the Improvements, including, without limitation, any architect's contracts, construction contracts and management contracts (all of the foregoing are herein referred to collectively as the "Contracts for Construction");

(x)    All rights of the Mortgagor, if any, as seller or borrower under any agreement, contract, understanding or arrangement pursuant to which the Mortgagor has, with the prior written consent of the Mortgagee, obtained the agreement of any Person to pay or disburse any money for the Mortgagor's sale (or borrowing on the security) of the Collateral or any part thereof (all of the foregoing is herein referred to collectively as the "Contracts for Sale"); 

(xi)    All rights of the Mortgagor in any permits, approvals, consents and other authorizations in connection with the Real Estate or the Improvements (all of the foregoing are herein referred to collectively as the "Permits"); 

(xii)    All rights of the Mortgagor and the Mortgagor's bankruptcy trustee to deal with the Facility Lease, which rights may arise as a result of the commencement of a case under the federal bankruptcy laws by or against (i) the Mortgagor or (ii) the lessor ("Lessor") under the Facility Lease, including, without limitation, the right to assume or reject, or compel the assumption or rejection of such Facility Lease pursuant to 11 U.S.C. § 365(a) or any successor law (the "Bankruptcy Code"), the right to seek and obtain extensions of time to assume or reject such Facility Lease, and the right to elect whether to treat such Facility Lease as terminated by the Lessor's rejection of such Facility Lease or to remain in possession of the Collateral and offset damages pursuant to 11 U.S.C. § 365(h)(l) or any successor law; and

(xiii)    All other property or rights of the Mortgagor of any kind or character related to the Real Estate or the Improvements, all substitutions, replacements and additions thereto, whether now existing or hereafter acquired, and all proceeds (including insurance and condemnation proceeds) and products of any of the foregoing (all of the Real Estate and the Improvements, and any other property related to the Real Estate or the Improvements which is real estate under applicable law, is sometimes referred to collectively herein as the "Premises").

H.    For purposes herein, "Person" means an individual, partnership, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

I.    For purposes herein, "Hazardous Substances" means a hazardous substance as defined under the Comprehensive Emergency Response Compensation and Liability Act of 1980, 42 U.S.C. §§9601, et seq., as from time to time amended,; “Hazardous Waste” means a hazardous waste as defined under the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §§6901, et seq., as from time to time amended; and “Hazardous Discharge” means release or threat of release 

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of a “reportable quantity” (as defined in any Environmental Law) of any asbestos or asbestos-containing material, Hazardous Substance, Hazardous Waste, Toxic Chemical or Petroleum has occurred on the Land or Improvements.  

J.    For purposes herein, "Environmental Law" means any applicable federal, state, local, municipal,  foreign, international, multinational or other applicable constitutions, laws, ordinances, principles of common law, regulations, statutes or  treaties designed to minimize, prevent, punish or remedy the consequences of actions that damage or threaten the Environment or public health and safety. 

GRANT

NOW THEREFORE, for and in consideration of the Mortgagee's making any loan, advance or other financial accommodation to or for the benefit of the Mortgagor, including sums due under the Agreement, this Mortgage or the other Loan Documents and in consideration of the various agreements contained herein, in the Agreement, and in the other Loan Documents, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Mortgagor, and in order to secure the full, timely and proper payment and performance of each and every one of the Secured Obligations.

THE MORTGAGOR HEREBY MORTGAGES, WARRANTS, CONVEYS, TRANSFERS AND ASSIGNS TO THE MORTGAGEE AND ITS SUCCESSORS AND ASSIGNS FOREVER, WITH POWER OF SALE, AND GRANTS TO THE MORTGAGEE AND ITS SUCCESSORS AND ASSIGNS FOREVER A CONTINUING SECURITY INTEREST IN AND TO, ALL OF THE COLLATERAL,

TO HAVE AND TO HOLD the Collateral unto the Mortgagee, its successors and assigns, forever, hereby expressly waiving and releasing any and all right, benefit, privilege, advantage or exemption under and by virtue of any and all statutes and laws of the state or other jurisdiction in which the Real Estate is located providing for the exemption of homesteads from sale on execution or otherwise.

The Mortgagor hereby covenants with and warrants to the Mortgagee and with the purchaser at any foreclosure sale: that at the execution and delivery hereof it is well seized of the Premises, and of a valid leasehold estate therein and that it has rights in the other Collateral; that the Collateral is free from all encumbrances whatsoever (and any claim of any other Person thereto) other than the TIF Cooperative Agreement (as defined in the Facility Lease), the security interest granted to the Mortgagee herein and pursuant to the other Loan Documents and the encumbrances set forth in the title insurance policy insuring the lien of this Mortgage in favor of the Mortgagee (the "Permitted Exceptions"); that the Facility Lease is in full force and effect and has not been modified or terminated; that the Mortgagor is not in default under the Facility Lease; that it has good and lawful right to sell, mortgage and convey the Collateral; and that it and its successors and assigns 

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will forever warrant and defend the Collateral against all claims and demands whatsoever with the exception of those arising by, through or under the Permitted Exceptions.  

ARTICLE I

COVENANTS AND AGREEMENTS OF THE MORTGAGOR

Further to secure the payment and performance of the Secured Obligations, the Mortgagor hereby covenants, warrants and agrees with the Mortgagee as follows:

1.1.    Payment of Secured Obligations.  The Mortgagor agrees that it will pay, timely and in the manner required in the appropriate documents or instruments, all the Secured Obligations (including fees and charges).  All sums payable by the Mortgagor hereunder shall be paid without demand, counterclaim, offset, deduction or defense.  The Mortgagor waives all rights now or hereafter conferred by statute or otherwise to any such demand, counterclaim, offset, deduction or defense.

1.2.    Payment of Taxes.  The Mortgagor will pay or cause to be paid when due all taxes and assessments, general or special, and any and all levies, claims, charges, expenses and liens, ordinary or extraordinary, governmental or non-governmental, statutory or otherwise, due or to become due, that may be levied, assessed, made, imposed or charged on or against the Collateral or any property used in connection therewith, and will pay when due any tax or other charge on the interest or estate in lands created or represented by this Mortgage or by any of the Loan Documents, whether levied against the Mortgagor or the Mortgagee or otherwise, and if requested by Mortgagee, will submit to the Mortgagee all receipts showing payment of all of such taxes, assessments and charges.  Notwithstanding the preceding sentence, Mortgagor may, at its expense, but only after prior notice to the Mortgagee, by appropriate proceedings diligently prosecuted, contest in good faith the validity or amount of any such taxes, assessments, governmental charges, levies and claims and during the period of contest, and after notice to the Mortgagee, may permit the items so contested to remain unpaid. However, if at any time the Mortgagee shall notify the Mortgagor in writing that, in the opinion of legal counsel reasonably satisfactory to the Mortgagee, by nonpayment of any such items the lien and security interest created by the Loan Documents as to any part of the Project will be materially affected or the Project or any material part thereof will be subject to imminent loss or forfeiture, the Mortgagor shall promptly pay such taxes, assessments, charges, levies or claims;

1.3.    Maintenance and Repair.  The Mortgagor will: not abandon the Premises; not do or suffer anything to be done which would depreciate or impair or the security of this Mortgage; pay promptly for all labor and materials for all construction, repairs and improvements to or on the Premises; maintain, preserve and keep the Goods and the Premises in good, safe and insurable condition and repair and promptly make any needful and proper repairs, replacements, renewals, additions or substitutions required by wear, damage, obsolescence or  destruction, all as promptly 

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as possible under the circumstances but in all cases in compliance with any time period provided under applicable requirements of governmental authorities and insurers; not commit, suffer, or permit waste of any part of the Premises; and maintain all grounds and sidewalks in good and neat order and repair.  Except in connection with the provision of the Project, the Adjacent Hangar Demolition and/or the Related Area Improvements in accordance with the Loan Documents, the Mortgagor will: not do or suffer anything to be done which would depreciate or impair the use, operation or value of the Collateral; not remove or demolish any of the Improvements; not make any changes, additions or alterations to the Premises except as required by any applicable governmental requirement or as otherwise approved in writing by the Mortgagee.

1.4.    Sales; Liens.  The Mortgagor will not:  sell, contract to sell, assign, transfer or convey, or permit to be transferred or conveyed, the Collateral or any part thereof or any interest or estate in any thereof (including any conveyance into a trust or any conveyance of the beneficial interest in any trust that may be holding title to the Premises) or remove any of the Collateral from the Premises except as permitted under the Loan Documents for the sale of inventory in the ordinary course of Mortgagor’s business; or create, suffer or permit to be created or to exist any mortgage, lien, claim, security interest, charge, encumbrance or other right or claim of any kind whatsoever upon the Collateral or any part thereof, except those of current taxes not then due and payable, and the Permitted Exceptions.

1.5.    Access by Mortgagee.  The Mortgagor will at all times:  deliver to the Mortgagee either all of its executed originals (in the case of chattel paper or instruments) or (in all other cases), if requested by Mortgagee, certified copies of all Leases, agreements creating or evidencing Intangibles, Plans, Contracts for Construction, Contracts for Sale, Permits, all amendments and supplements thereto, and any other document which is, or which evidences, governs, or creates, Collateral; permit access at reasonable times upon prior reasonable notice by the Mortgagee to the Mortgagor's books and records; permit the Mortgagee to inspect construction progress reports, tenant registers, sales records, insurance policies and other papers for examination and the making of copies and extracts; prepare such schedules, summaries, reports and progress schedules as the Mortgagee may reasonably request; and permit the Mortgagee and its agents and designees, to inspect the Premises at reasonable times upon prior reasonable notice.

1.6.    Stamp and Other Taxes.  If the federal, or any state, county, local, municipal or other, government or any subdivision of any thereof having jurisdiction, shall levy, assess or charge any tax, assessment or imposition upon this Mortgage, any of the other Secured Obligations, or any of the other Loan Documents, the interest of the Mortgagee in the Collateral, or any of the foregoing, or upon the Mortgagee by reason of or as holder of any of the foregoing, or shall at any time or times require revenue stamps to be affixed to this Mortgage, or any of the other Loan Documents, the Mortgagor shall pay all such taxes and stamps to or for the Mortgagee as they become due and payable.  If any law or regulation is enacted or adopted permitting, authorizing or requiring any tax, assessment or imposition to be levied, assessed or charged, which law or regulation prohibits 

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the Mortgagor from paying the tax, assessment, stamp, or imposition to or for the Mortgagee, then all sums hereby secured shall become immediately due and payable at the option of the Mortgagee.  

1.7.    Insurance.  The Mortgagor shall insure the Project in an aggregate amount equal to the replacement cost of the Project, but in any event not less than the sum of the (a) 100% of the aggregate principal amount of Bonds outstanding from time to time, (b) the unpaid principal balance of the State Loan, and (c) the unpaid principal balance of the LDI Loan, from time to time, against loss or damage by fire, boiler explosion, as well as such other risks as are covered by the endorsement commonly known as “extended coverage,” plus vandalism and malicious mischief, with insurance companies authorized to issue such policies in the State.  Any insurance policy maintained by the Mortgagor pursuant to this Section may provide that the policy does not cover the first $100,000 or less of loss, or such greater amount as may (with due regard to insurance practices from time to time current with respect to properties similar to the Project) be approved in writing by Mortgagee, with the result that the Mortgagor, is its own insurer to that extent.  Any return of insurance premium or dividends based upon such premium shall be due and payable solely to the Mortgagor unless such premium shall have been paid by the Mortgagee or Trustee.  The obligation to provide and maintain insurance shall be the obligation of the Mortgagor.

As an alternative to the above, the Mortgagor may insure such property under a blanket insurance policy or policies that cover not only such property but also other properties of the Mortgagor or its affiliates.

Any insurance policy issued pursuant this Section shall be so written or endorsed as to make losses, if any, adjustable by the Mortgagor and payable to the Mortgagor and the Trustee, for the account of the Mortgagee; provided, any such insurance policy may be so written or endorsed as to make losses not in excess of $100,000 for each occurrence held by and payable directly to the Mortgagor as hereinafter provided.  Each insurance policy provided for in this Section shall contain a provision to the effect that the insurance company shall not cancel the same without first giving written notice thereof to the Mortgagee and the Trustee at least thirty days in advance of such cancellation, and the Mortgagor shall deliver to the Mortgagee and the Trustee duplicate copies or certificates of insurance pertaining to each such policy of insurance procured by a Mortgagor and shall keep such duplicate copies or certificates up to date.
Section 5.6.    
The Net Proceeds of the insurance carried pursuant to the provisions of the Lease shall be applied as allocated in the Loan Agreement.

The Mortgagor shall maintain commercial general liability insurance against claims for personal injury, death or property damage suffered by others upon, in or about any premises and maintain all workers’ compensation or similar insurance as may be required under the laws of any state or jurisdiction in which the Lessee may be engaged in business.  All insurance for which provision has been made in this paragraph shall be maintained against such risks, at such amounts and with such retentions or deductibles as such insurance is usually carried by Persons engaged in 

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the same or similar businesses, and all such insurance shall be effected or maintained in force under a policy or policies issued by insurers of recognized responsibility, except that the Mortgagor may maintain workers’ compensation insurance in any state or jurisdiction in any manner permitted by the laws of that jurisdiction.  The Mortgagor and the Trustee shall be made additional insureds under such general liability policies.  The insurance provided by this Section may be by blanket insurance policy or policies.

All of the above-mentioned original insurance policies or certified copies of such policies and certificates of such insurance satisfactory to the Mortgagee, together with receipts for the payment of premiums thereon, shall be delivered to and held by the Mortgagee, which delivery shall constitute an assignment to the Mortgagee of all return premiums to be held as additional security hereunder.  The liability insurance policies required hereunder shall name the Mortgagee as additional insured and loss payee.  All renewal and replacement policies shall be delivered to the Mortgagee at least thirty (30) days before the expiration of the expiring policies.  Nothing contained in this Mortgage shall create any responsibility or obligation on the Mortgagee to collect any amounts owing on any insurance policy or resulting from any condemnation, to rebuild or replace any damaged or destroyed Improvements or other Collateral or to perform any other act hereunder.  The Mortgagee shall not by the fact of approving, disapproving, accepting, preventing, obtaining or failing to obtain any insurance, incur any liability for or with respect to the amount of insurance carried, the form or legal sufficiency of insurance contracts, solvency of insurance companies, or payment or defense of lawsuits, and the Mortgagor hereby expressly assumes full responsibility therefor and all liability, if any, with respect thereto.

1.8.    Eminent Domain.  In case the Collateral, or any part or interest in any thereof, is taken by condemnation, the Mortgagor shall take all action reasonably required by the Mortgagee in order to protect Mortgagor's and Mortgagee's rights with respect to any such taking, including the commencement of, appearance in or prosecution of any appropriate action or proceeding.  The Mortgagee is hereby empowered to collect and receive all compensation and awards of any kind whatsoever (referred to collectively herein as "Condemnation Awards") which may be paid for any property taken or for damages to any property not taken (all of which the Mortgagor hereby assigns to the Mortgagee), and, subject to the terms of the Facility Lease and the other Loan Documents, all Condemnation Awards so received shall be forthwith applied by the Mortgagee, as it may elect in its sole and unreviewable discretion, to the prepayment of the Secured Obligations, or, at the option of the Mortgagee, may be held by the Mortgagee as additional security for the Secured Obligations, or may be applied to the repair and restoration of any property not so taken or damaged.  The Mortgagor hereby empowers the Mortgagee, in the Mortgagee's absolute discretion to settle, compromise and adjust any and all claims or rights arising under any condemnation or eminent domain proceeding relating to the Collateral or any portion thereof.

1.9.    Governmental Requirements.  The Mortgagor will at all times fully comply in all material respects with, and cause the Collateral and the use and condition thereof fully to comply in all material respects with, all applicable federal, state, county, municipal, local and other 

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governmental statutes, ordinances, requirements, regulations, rules, orders and decrees of any kind whatsoever that apply or relate to the Mortgagor or the Collateral or the use thereof (including, without limitation, those relating to land use and development, construction, access, water rights and use, noise, environmental pollution and hazardous waste and substances, including, without limitation, Hazardous Substances), and will observe and comply with all conditions and requirements necessary to preserve and extend any and all rights, licenses, permits, privileges, franchises and concessions (including, without limitation, those relating to land use and development, construction, access, water rights and use, noise, environmental pollution and hazardous waste and substances, including, without limitation, Hazardous Substances) which are applicable to the Mortgagor or have been granted for the Collateral or the use thereof.  Unless required by applicable law, or unless Mortgagee has otherwise first agreed in writing (which consent shall not be unreasonably withheld, conditioned or delayed), the Mortgagor shall not make or allow any material changes to be made in the nature of the occupancy or use of the Premises or any portion thereof for which the Premises or such portion was intended at the time this Mortgage was delivered.  The Mortgagor shall not initiate or acquiesce in any change in any zoning or other land use classification now or hereafter in effect and affecting the Premises or any part thereof without in each case obtaining the Mortgagee's prior written consent thereto.  

1.10.    No Mechanics' Liens.  The Mortgagor will not suffer any construction, mechanic's, laborer's or materialmen's lien to be created or remain outstanding upon the Premises or any part thereof and will bond or otherwise discharge all such liens within 90 days from the date of filing. The Mortgagor agrees to promptly deliver to the Mortgagee a copy of any notices that the Mortgagor receives with respect to any pending or threatened lien or the foreclosure thereof.  

1.11.    Continuing Priority.  The Mortgagor will:  pay such fees, taxes and charges, execute and record or file (at the Mortgagor's expense) such deeds, conveyances, mortgages and financing statements, obtain such title opinions, title insurance policy endorsements, acknowledgments or consents, notify such obligors or providers of services and materials and do all such other acts and things as the Mortgagee may from time to time reasonably request to establish and maintain a valid and perfected first and prior lien on and security interest in the Collateral; maintain its office and principal place of business at all times at the address shown below; and keep all of its books and records relating to the Collateral on the Premises or at such address; and keep all tangible Collateral on the Real Estate except as the Mortgagee may otherwise consent in writing. 

1.12.    Utilities.  The Mortgagor will pay or cause to be paid all utility charges incurred in connection with the Collateral promptly when due and maintain all utility services available for use at the Premises.

1.13.    Contract Maintenance; Other Agreements; Leases.  The Mortgagor will, for the benefit of the Mortgagee, fully and promptly keep, observe, perform and satisfy each obligation, condition, covenant, and restriction of the Mortgagor affecting the Premises or imposed on it under any material agreement between Mortgagor and a third party relating to the Collateral or the Secured 

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Obligations secured hereby, including, without limitation, the Leases, the Contracts for Sale, Contracts for Construction and the Intangibles (collectively, the "Third Party Agreements"), so that there will be no default thereunder and so that the Persons (other than the Mortgagor) obligated thereon shall be and remain at all times obligated to perform for the benefit of the Mortgagee; and the Mortgagor will not permit to exist any condition, event or fact which could allow or serve as a basis or justification for any such Person to avoid such performance.  Without the prior written consent of the Mortgagee, the Mortgagor shall not (i) make or permit any termination or amendment of the rights of the Mortgagor under any Third Party Agreement; (ii) collect rents or the proceeds of any Leases or Intangibles more than 30 days before the same shall be due and payable; (iii) modify or amend any Leases, or, except where the lessee is in default, cancel or terminate the same or accept a surrender of the leased premises; (iv) consent to the assignment or subletting of the whole or any portion of any lessee's interest under any Leases except as permitted under the Loan Documents; or (v) in any other manner impair Mortgagee's rights and interest with respect to the Rents.  The Mortgagor shall promptly deliver to the Mortgagee copies of any demands or notices of default received by the Mortgagor in connection with any Third Party Agreement and allow the Mortgagee the right, but not the obligation, to cure any such default.  All security or other deposits, if any, received from tenants under the Leases shall be maintained in an account satisfactory to the Mortgagee and in compliance with the law of the state where the Premises are located and with an institution satisfactory to the Mortgagee.  

1.14.    Environmental Matters.  Mortgagor will investigate, clean up, remove or remediate any spill or release of Hazardous Substances at the Premises in accordance with the requirements of all Environmental Laws and will otherwise use, handle, store and dispose of all Hazardous Substances in accordance with the requirements of all Environmental Laws.

1.15.    No Assignments; Future Leases.  Except as permitted under the Loan Documents, the Mortgagor will not cause or permit any Rents, Leases, Contracts for Sale, or other contracts relating to the Premises to be assigned, transferred, conveyed, pledged or disposed of to any party other than the Mortgagee without first obtaining the express written consent of the Mortgagee to any such assignment or permit any such assignment to occur by operation of law.  In addition, except as permitted under the Loan Documents, the Mortgagor shall not cause or permit all or any portion of or interest in the Premises or the Improvements to be leased (that word having the same meaning for purposes hereof as it does in the law of landlord and tenant) directly or indirectly to any Person.

1.16.    Assignment of Leases and Rents and Collections.

(a)    All of the Mortgagor's interest in and rights under the Leases now existing or hereafter entered into, and all of the Rents, whether now due, past due, or to become due, and including all prepaid rents and security deposits, and all other amounts due with respect to any of the other Collateral, are hereby absolutely, presently and unconditionally assigned and conveyed to the Mortgagee to be applied by the Mortgagee in payment of all sums due under the Secured Obligations and all other sums payable under this Mortgage.  Prior to the 

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occurrence of any Default, the Mortgagor shall have a license to collect and receive all Rents and other amounts, which license shall be terminated at the sole option of the Mortgagee, without regard to the adequacy of its security hereunder and without notice to or demand upon the Mortgagor, upon the occurrence of any Default.  It is understood and agreed that neither the foregoing assignment to the Mortgagee nor the exercise by the Mortgagee of any of its rights or remedies under Article III hereof shall be deemed to make the Mortgagee a "mortgagee-in-possession" or otherwise responsible or liable in any manner with respect to the Collateral or the use, occupancy, enjoyment or any portion thereof, unless and until the Mortgagee, in person or by agent, assumes actual possession thereof.  Nor shall appointment of a receiver for the Collateral by any court at the request of the Mortgagee or by agreement with the Mortgagor, or the entering into possession of any part of the Collateral by such receiver, be deemed to make the Mortgagee a mortgagee-in-possession or otherwise responsible or liable in any manner with respect to the Collateral or the use, occupancy, enjoyment or operation of all or any portion thereof.  Upon the occurrence of any Default, this shall constitute a direction to and full authority to each lessee under any Leases, each guarantor of any of the Leases and any other Person obligated under any of the Collateral to pay all Rents and other amounts to the Mortgagee without proof of the Default relied upon.  The Mortgagor hereby irrevocably authorizes each such Person to rely upon and comply with any notice or demand by the Mortgagee for the payment to the Mortgagee of any Rents and other amounts due or to become due. 

(b)    The Mortgagor shall apply the Rents and other amounts to the payment of all necessary and reasonable operating costs and expenses of the Collateral, debt service on the Secured Obligations and otherwise in compliance with the provisions of the Loan Documents.

(c)    The Mortgagee shall have the right to assign the Mortgagee's right, title and interest in any Leases to any subsequent holder of this Mortgage or any participating interest therein or to any Person acquiring title to all or any part of the Collateral through foreclosure or otherwise.  Any subsequent assignee shall have all the rights and powers herein provided to the Mortgagee.  Upon the occurrence of any Default, the Mortgagee shall have the right to execute new leases of any part of the Collateral, including leases that extend beyond the term of this Mortgage.  Upon occurrence of Default, the Mortgagee shall have the authority, as the Mortgagor's attorney-in-fact, such authority being coupled with an interest and irrevocable, to sign the name of the Mortgagor and to bind the Mortgagor on all papers and documents relating to the operation, leasing and maintenance of the Collateral.

1.17.    The Mortgagee's Performance.  If the Mortgagor fails to pay or perform any of its obligations herein contained (including payment of expenses of foreclosure and court costs), the Mortgagee may (but need not), as agent or attorney-in-fact of the Mortgagor, make any payment or perform (or cause to be performed) any obligation of the Mortgagor hereunder, in any form and manner deemed expedient by the Mortgagee, and any amount so paid or expended (plus reasonable 

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compensation to the Mortgagee for its out-of-pocket and other expenses for each matter for which it acts under this Mortgage), with interest thereon at the rate of seven percent (7%) (the "Default Rate"), shall be added to the principal debt hereby secured and shall be repaid to the Mortgagee upon demand.  By way of illustration and not in limitation of the foregoing, the Mortgagee may (but need not) do all or any of the following: make payments of principal or interest or other amounts on any lien, encumbrance or charge on any of the Collateral; complete construction; make repairs; collect rents; prosecute collection of the Collateral or proceeds thereof; obtain insurance and pay premiums therefor; purchase, discharge, compromise or settle any tax lien or any other lien, encumbrance, suit, proceeding, title or claim thereof; contest any tax or assessment; and redeem from any tax sale or forfeiture affecting the Premises.  In making any payment or securing any performance relating to any obligation of the Mortgagor hereunder, the Mortgagee shall be the sole judge of the legality, validity and amount of any lien or encumbrance and of all other matters necessary to be determined in satisfaction thereof. No such action of the Mortgagee shall ever be considered as a waiver of any right accruing to it on account of the occurrence of any matter which constitutes a Default or an Event of Default.  

1.18.    Subrogation.  To the extent that the Mortgagee, on or after the date hereof, pays any sum under any provision of law or any instrument or document creating any lien or other interest prior or superior to the lien of this Mortgage, or the Mortgagor or any other Person pays any such sum with the proceeds of the loan secured hereby, the Mortgagee shall have and be entitled to a lien or other interest on the Collateral equal in priority to the lien or other interest discharged and the Mortgagee shall be subrogated to, and receive and enjoy all rights and liens possessed, held or enjoyed by, the holder of such lien, which shall remain in existence and benefit the Mortgagee in securing the Secured Obligations.

1.19.    Reserve for Taxes, Assessments and Insurance.  After and during the continuance of an Event of Default and upon request by the Mortgagee, the Mortgagor covenants and agrees to pay to the Mortgagee (or the Mortgagee's agent) monthly until the Secured Obligations have been paid in full, a sum equal to real estate taxes and assessments and insurance premiums next due upon the Premises (all as reasonably estimated by the Mortgagee or its agent) divided by the number of months to elapse before one month prior to the date when such taxes, and assessments and insurance premiums will become due and payable, such sums to be held by the Mortgagee without interest accruing thereon (except to the extent, if any, required by applicable law), to pay each of the said items.

All payments described above in this Section shall be paid by the Mortgagor each month in a single payment to be applied by the Mortgagee (or its agent) to the foregoing items in such order as the Mortgagee shall elect in its sole but reasonable discretion.  The Mortgagor shall also pay to the Mortgagee, at least 30 days prior to the due date of any taxes, and assessments levied on, against or with respect to the Premises, or any insurance premium due with respect to the Premises, such additional amount as may be necessary to provide the Mortgagee (or its agent) with sufficient funds 

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to pay any such tax, assessment, and insurance premiums under this Section 1.19 at least 30 days in advance of the due date thereof.

The Mortgagee (or its agent) shall, within 20 days of receipt from the Mortgagor of a written request therefor together with such supporting documentation as the Mortgagee (or its agent) may reasonably require (including, without limitation, official tax bills or, as applicable, statements for insurance premiums), cause proper amounts to be withdrawn from such account and paid directly to the appropriate tax collecting authority or insurer.  Even though the Mortgagor may have made all appropriate payments to the Mortgagee (or its agent) as required by this Mortgage, the Mortgagor shall nevertheless have full and sole responsibility at all times to cause all taxes, assessments and insurance premiums to be fully and timely paid, and the Mortgagee (or its agent) shall have no responsibility or obligation of any kind with respect thereto except with respect to payments required to be made by the Mortgagor hereunder for which the Mortgagee (or its agent) has received funds to cover such payments in full and all statements, invoices, reports or other materials necessary to make such payments, all not less than 30 days prior to the deadline for any such payment.  If at any time the funds so held by the Mortgagee (or its agent) shall be insufficient to cover the full amount of all taxes, assessments and insurance premiums then accrued (as estimated by the Mortgagee or its agent) with respect to the then-current twelve-month period, the Mortgagor shall, within ten days after receipt of notice thereof from the Mortgagee (or its agent) deposit with the Mortgagee (or its agent) such additional funds as may be necessary to remove the deficiency.  If the Premises are sold under foreclosure or are otherwise acquired by the Mortgagee, accumulations under this Section 1.19 may be applied to the Secured Obligations in such order of application as the Mortgagee may elect in its sole discretion. 

1.20.    Covenants Regarding Facility Lease.

(a)    The Facility Lease is a valid and subsisting lease, is in full force and effect in accordance with the terms thereof and has not been modified except as herein set forth.  All of the rents and other charges payable under the Facility Lease prior to the execution hereof have been paid, all of the terms, conditions and agreements contained in the Facility Lease have been performed and no default exists under the Facility Lease.  This Mortgage is lawfully executed and delivered in conformity with the Facility Lease and is, and will be kept, a valid lien on the interests of the Mortgagor therein.

(b)    The Mortgagor will promptly pay, or cause to be paid, all rents, charges and other sums or amounts required to be paid by the Mortgagor under the terms of the Facility Lease, will further timely and fully keep and perform all of the covenants, terms, conditions and provisions of the Facility Lease required to be performed and complied with by the tenant thereunder, and will not do or suffer to be done anything the doing of which, or refrain from doing anything the omission of which, will impair the security of this Mortgage.

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(c)    The Mortgagor also covenants that it will not modify, extend, supplement, or in any way alter the terms of the Facility Lease or cancel or surrender the Facility Lease, or waive, excuse, condone or in any way release or discharge the Lessor thereunder of or from any obligations, covenants, conditions and agreements by said Lessor to be done and performed, without the Mortgagee's prior written consent.  The Mortgagor does by these presents expressly release, relinquish and surrender unto the Mortgagee all its right, power and authority to cancel, surrender, amend, modify, supplement or alter in any way the terms and provisions of the Facility Lease and any attempt on the part of the Mortgagor to exercise any such right without the prior written consent of the Mortgagee thereto shall constitute a default under the terms hereof.  The Mortgagor also covenants that it will promptly notify the Mortgagee of any breach by the Lessor under the Facility Lease and of any inability of such Lessor to perform its obligations under the Facility Lease and will enforce the obligations of the Lessor under the Facility Lease, to the end that Mortgagor may enjoy all of the rights granted to it as lessee under the Facility Lease.  The Mortgagor assigns to the Mortgagee the proceeds of any claim the Mortgagor may have against such Lessor for such breach or inability.  The Mortgagee shall have the sole right to choose either (i) to proceed against such Lessor as if the Mortgagee were the named lessee thereunder, in the Mortgagor's name or in the Mortgagee's name as agent for the Mortgagor, and the Mortgagor agrees to cooperate with the Mortgagee in such action and to execute all documents required by the Mortgagee in furtherance of such action, or (ii) to have the Mortgagor proceed on its and the Mortgagee's behalf, in which event the Mortgagee may participate in such proceedings, and the Mortgagor will deliver to the Mortgagee all documents required by the Mortgagee for such participation.  The Mortgagor shall, at its expense, diligently prosecute such proceedings, shall deliver to the Mortgagee copies of all papers served in connection therewith and shall consult and cooperate with the Mortgagee and its attorneys and agents, provided that no settlement of such proceedings may be made by the Mortgagor without the Mortgagee's prior written consent.

(d)    The Mortgagor shall give the Mortgagee immediate notice of any material default by the Mortgagor under the Facility Lease or of the receipt by it of any notice of default from the Lessor thereunder or notice of termination of the Facility Lease pursuant to the provisions thereof and shall furnish to the Mortgagee immediately any and all information which the Mortgagee may reasonably request concerning the performance by the Mortgagor of the covenants of the Facility Lease or of this Mortgage.  The Mortgagor shall permit forthwith the Mortgagee or its representatives at all reasonable times to make investigation or examination concerning the performance by the Mortgagor of the covenants of the Facility Lease or of this Mortgage.  The Mortgagor further covenants and agrees that it will promptly deposit with the Mortgagee a copy of the Facility Lease, certified as true, correct and complete by a duly elected and authorized officer of Mortgagor, and any and all documentary evidence received by it showing compliance by the Mortgagor with the provisions of the Facility Lease and will also deposit with the Mortgagee an exact copy of any notice, communication, plan, specification or other instrument or document received 

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or given by it in any way relating to or affecting the Facility Lease which may concern or affect the estate of the Lessor or the lessee in or under the Facility Lease or in the real estate thereby demised.

1.21.    Bankruptcy Rights and Remedies.  The lien of this Mortgage attaches to all of Mortgagor's rights and remedies at any time arising under or pursuant to Section 365 of the Bankruptcy Code, including, without limitation, all of Mortgagor's rights to remain in possession of the Collateral, and the following rights:

(a)    If the Facility Lease is rejected or disaffirmed by the Lessor of the Facility Lease pursuant to Section 365(a) of the Bankruptcy Code, the Mortgagor covenants that it will not elect to treat the Facility Lease as terminated under Section 365(h) of the Bankruptcy Code, and hereby assigns to the Mortgagee the sole and exclusive right to make or refrain from making such election.

(b)    If the Lessor under the Facility Lease rejects or disaffirms such Lease pursuant to the Bankruptcy Code and the Mortgagee elects to have the Mortgagor remain in possession under any legal right Mortgagor may have to occupy the premises leased pursuant to the Facility Lease, then (i) Mortgagor shall remain in such possession and shall perform all acts necessary for Mortgagor to retain its right to remain in such possession for the unexpired term of the Facility Lease (including all renewals thereof), whether such acts are required under the then existing terms and provisions of the Facility Lease or otherwise and (ii) all of the terms and provisions of this Mortgage and the lien created thereby shall remain in full force and effect and shall be extended automatically to such possession, occupancy and interest of the Mortgagor.

(c)    If, pursuant to Subsection 365(h)(1)(B) of the Bankruptcy Code, the Mortgagor seeks to offset against the rent reserved in the Facility Lease the amount of any damages caused by the non-performance by Lessor of any of the obligations of Lessor under the Facility Lease after the rejection by the Lessor of the Facility Lease under the Bankruptcy Code, the Mortgagor shall, prior to effecting such offset, notify the Mortgagee of its intent so to do, setting forth the amount proposed to be so offset, and in the event of an objection thereto by the Mortgagee, the Mortgagor shall not effect any offset of the amount so objected to by the Mortgagee.  If the Mortgagee has failed to object as aforesaid within twenty (20) days after notice from the Mortgagor in accordance with the first sentence of this paragraph, the Mortgagor may proceed to effect such offset in the amounts set forth in the Mortgagor's notice.  Neither the failure to object as aforesaid nor any objection or other communication between the Mortgagee and the Mortgagor relating to such offset shall constitute an approval of any such offset by the Mortgagee.  The Mortgagor shall indemnify and save the Mortgagee harmless from and against any and all claims, demands, actions, suits, proceedings, damages, losses, costs and expenses of every nature whatsoever (including, without limitation, 

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attorneys' fees) arising from or relating to any offset by the Mortgagor against the rent reserved in the Facility Lease.

(d)    The Mortgagor hereby unconditionally assigns, transfers and sets over to the Mortgagee all of the Mortgagor's claims and rights to the payment of damages arising from any rejection by Lessor of the Facility Lease under the Bankruptcy Code.  The Mortgagee shall have the right to proceed in its own name or in the name of the Mortgagor in respect of any claim, suit, action or proceeding relating to the rejection of the Facility Lease, including, without limitation, the right to file and prosecute, to the exclusion of the Mortgagor, any proofs of claim, complaints, motions, applications, notices and other documents, in any case in respect of Lessor under the Bankruptcy Code.  This assignment constitutes a present, irrevocable and unconditional assignment of the foregoing claims, rights and remedies, and shall continue in effect until all of the Secured Obligations shall have been satisfied and discharged in full.  Any amounts received by the Mortgagee as damages arising out of the rejection of the Facility Lease as aforesaid shall be applied first to all costs and expenses of the Mortgagee (including, without limitation, attorneys' fees) incurred in connection with the exercise of any of its rights or remedies under this paragraph.

(e)    If any action, proceeding, motion or notice shall be commenced or filed in respect of the Facility Lease or the Collateral in connection with any case under the Bankruptcy Code the subject of which is Lessor, the Mortgagee shall have the option, to the exclusion of the Mortgagor, to conduct and control any such litigation with counsel of the Mortgagee's choice.  The Mortgagee may proceed with any such litigation and the Mortgagor agrees to execute any and all powers, authorizations, consents or other documents required by the Mortgagee in connection therewith.  The Mortgagor shall, upon demand, pay to the Mortgagee all reasonable costs and expenses (including attorneys' fees) paid or incurred by the Mortgagee in connection with the prosecution or conduct of any such proceedings.  Any such costs or expenses not paid by the Mortgagor as aforesaid shall be secured by the lien of this Mortgage and shall be added to the principal amount of the Secured Obligations.  The Mortgagor shall not commence any action, suit, proceeding or case, or file any application or make any motion, in respect of the Facility Lease in any such case under the Bankruptcy Code without the prior written consent of the Mortgagee.

(f)    The Mortgagor shall promptly, after obtaining knowledge thereof, notify the Mortgagee orally of any filing by or against Lessor or the Mortgagor of a petition under the Bankruptcy Code.  The Mortgagor shall thereafter forthwith give written notice of such filing to the Mortgagee, setting forth any information available to the Mortgagor as to the date of such filing, the court in which such petition was filed and the relief sought therein.  The Mortgagor shall promptly deliver to the Mortgagee, following receipt, any and all notices, summons, pleadings, applications and other documents received by the Mortgagor in connection with any such petition and any proceedings relating thereto.

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(g)    If there shall be filed by or against the Mortgagor a petition under the Bankruptcy Code, and the Mortgagor, as lessee under the Facility Lease, shall determine to reject the Facility Lease pursuant to Section 365(a) of the Bankruptcy Code, the Mortgagor shall give the Mortgagee not less than twenty (20) days' prior notice of the date on which the Mortgagor shall apply to the bankruptcy court for authority to reject the Facility Lease.  In the alternative, should the Mortgagor determine not to assume the Facility Lease pursuant to Section 365(a) of the Bankruptcy Code, the Mortgagor shall give the Mortgagee written notice thereof not less than twenty (20) days before the Facility Lease will be deemed rejected under Section 365(d)(4) of the Bankruptcy Code.  The Mortgagee shall have the right, but not the obligation, to serve upon the Mortgagor within such twenty (20) day period a notice stating that (i) the Mortgagee demands that the Mortgagor assume and assign the Facility Lease to the Mortgagee pursuant to Section 365 of the Bankruptcy Code and (ii) the Mortgagee covenants to cure or provide adequate assurance of prompt cure of all defaults and provide adequate assurance of future performance under the Facility Lease.  If the Mortgagee serves upon the Mortgagor the notice described in the preceding sentence, the Mortgagor shall not seek to reject the Facility Lease and shall assume and assign the Facility Lease to the Mortgagee prior to the date it would be deemed rejected pursuant to Section 365(d)(4) of the Bankruptcy Code, subject to the performance by the Mortgagee of the covenant set forth in clause (ii) of the preceding sentence.

(h)    Effective upon the entry of an order for relief in respect of the Mortgagor under Chapter 7 of the Bankruptcy Code, the Mortgagor hereby assigns and transfers to the Mortgagee a non-exclusive right to apply to the bankruptcy court under Subsection 365(d)(1) of the Bankruptcy Code for an order extending the period during which the Facility Lease may be rejected or assumed.

(i)    All references to particular sections or subsections of the Bankruptcy Code shall be deemed to include any and all successor or replacement sections or subsections thereto.

1.22.    Mortgagee's Lease.  Notwithstanding the foregoing provisions of the foregoing paragraphs regarding termination of the Facility Lease, upon a termination or rejection of the Facility Lease, the Mortgagor acknowledges that the Mortgagee may enter into (1) an instrument recognizing, confirming and giving legal effect to the continued existence of the Facility Lease in favor of the Mortgagee or its designee, or (2) a new lease in favor of the Mortgagee or its designee (in either event the "Mortgagee's Lease") for the Collateral pursuant to the terms of the Facility Lease, or the provisions of a separate agreement between the Mortgagee and Lessor, under the following terms and conditions:

(a)    The Mortgagee's Lease shall be encumbered by the lien and security interest of this Mortgage which shall constitute the first and senior lien on the Mortgagee's Lease.

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(b)    The Mortgagee's execution of the Mortgagee's Lease shall not be deemed to be in satisfaction in whole or in part of the Secured Obligations and all of the other terms, covenants and conditions contained in this Mortgage shall remain as a lien on the Collateral.

(c)    The Mortgagor hereby releases, remises, and quitclaims to the Mortgagee any interest Mortgagor may have in the Mortgagee's Lease and further agrees and acknowledges that the Mortgagee may assign the Mortgagee's Lease without notice, consent or joinder of the Mortgagor. The Mortgagor further waives any right the Mortgagor may have to challenge the adequacy of any consideration received therefore provided that in the event of an assignment of the Mortgagee's Lease, the proceeds thereof, if any, less costs and fees, including, but not limited to, customary closing costs and reasonable attorneys' fees, shall be applied to reduce the Secured Obligations.

(d)    The Mortgagee or its designee shall pay or cause to be paid to the Lessor at the time of the execution and delivery of such Mortgagee's Lease, any and all sums which are at the time of execution and delivery of the Mortgagee's Lease due under the Facility Lease and in addition, all reasonable expenses, including reasonable attorneys' fees which the Lessor shall have incurred by reason of the actual or deemed rejection of the Facility Lease and the execution and delivery of the Mortgagee's Lease.  Such payments by the Mortgagee to the Lessor shall be deemed to have been made for the protection of the Mortgage and shall constitute part of the Secured Obligations.

1.23    Periodic Appraisals.  If at any time the Mortgagee shall determine in good faith that as a result of:

(a)    any law, regulation or guideline or any change or interpretation thereof; or

(b)    any central bank or other fiscal, monetary or other governmental authority having jurisdiction over the Mortgagee or the activities of the Mortgagee requesting, directing or imposing a condition upon the Mortgagee (whether or not such request, direction or condition shall have the force of law); or

(c)    the Mortgagee, in its reasonable discretion deeming appropriate;

the Mortgagee may require that the Mortgagor provide at the Mortgagor's sole cost and expense, within sixty (60) days after the Mortgagee's request (but not more than once during every 5 years), an appraisal for the Collateral indicating the present appraised fair market value of the Collateral.

(a)        1.24.    Indemnity Clause.  Without limiting any other rights hereunder or under applicable law, the Mortgagor shall defend and indemnify the Mortgagee and hold the Mortgagee harmless from and against all loss, liability, damage and expense, claims, costs, fines 

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and penalties, including reasonable attorney’s fees, suffered or incurred by the Mortgagee under or on account of the noncompliance or alleged noncompliance by the Mortgagor with any Environmental Laws with respect to (i) the Project Site, (ii) any operations, actions or inactions in the conduct of operations of the Project or at the Project Site or (iii) the Provision of the Project, the Adjacent Hangar Demolition and the Related Area Improvements, including without limitation, the assertion of any lien thereunder, with respect to any Hazardous Discharge, the presence of any asbestos, asbestos-containing materials, Hazardous Substance, Hazardous Waste, Toxic Chemical or Petroleum affecting any of the Project Site, whether or not the same originates or emerges from the Project Site or any contiguous real estate, including any loss in value of the leasehold interest in the Premises as a result of the foregoing.

1.25.    Reasonable Attorneys' Fees.  Each borrower, endorser and guarantor jointly and severally agree to pay all costs, reasonable attorneys' fees, paralegal fees, and expenses incurred in the event it becomes necessary for the Mortgagee to protect its security and/or in the event of collection, whether suit be brought or not, and if suit is brought said parties agree to pay the Mortgagee's costs and reasonable attorneys' fees, paralegal fees and expenses incurred therein including costs and reasonable attorneys' fees, paralegal fees and expenses incurred upon appeal, if any.

1.26.    Title Warranty.  The Mortgagor covenants with the Mortgagee that the Mortgagor warrants the title to the Collateral.

ARTICLE II

DEFAULT

2.1.    The occurrence of an "Event of Default" or "Default" under the terms and provisions of the Agreement, any of the Loan Documents or any of the documents evidencing other Secured Obligations, or the occurrence of any default under any such documents which do not define "Event of Default" or "Default", shall constitute an Event of Default or Default, respectively, under this Mortgage.

The Mortgagor shall be in default upon the occurrence of any one or more of any of the following events (each an "Event of Default"; a "Default" is any Event of Default or any event, which with the lapse of time or the giving of notice or both would be an Event of Default): 

(a)    Failure by the Mortgagor to observe or perform any other term, covenant or agreement to be observed or performed by the Mortgagor under this Mortgage, and continuation of such failure for thirty (30) days after the Mortgagor has received written notice from the Mortgagee thereof, or for such longer period as the Mortgagee may agree to in writing; provided that if the failure is other than the payment of money and is of such nature that it cannot be corrected within the applicable period, such failure shall not constitute 

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an Event of Default so long as the Mortgagor institutes curative action within the applicable period and diligently pursues such action to completion, and provided further that such cure period will not apply to (x) any default which in the Mortgagor’s good faith determination is incapable of cure, or (y) any failure by the Mortgagpor to maintain any insurance required herein or to permit inspection of the Collateral; or

(b)    Any warranty or representation made by the Mortgagor in this Mortgage or in any certificate, statement or report furnished or made to the Mortgagor in connection herewith shall prove to have been false or misleading in any material respect when made or deemed made; or

(c)    The Collateral shall be placed under control or custody of any court ; or

(d)    An attachment, levy or restraining order shall be issued for any portion of the Collateral and such attachment, levy, or restraining order is not released or terminated within 90 days or otherwise addressed to the satisfaction of the Mortgagor. 

ARTICLE III

REMEDIES

3.1.    Acceleration.  Upon the occurrence of any Event of Default, the entire indebtedness secured by the Agreement and all other Secured Obligations together with interest thereon at the Default Rate shall, subject to the terms of the Agreement, at the option of the Mortgagee, without demand or notice of any kind to the Mortgagor or any other person, become immediately due and payable.

3.2.    Remedies Cumulative.  No remedy or right of the Mortgagee hereunder or under the Agreement, or any of the other Loan Documents, or otherwise, or available under applicable law or in equity, shall be exclusive of any other right or remedy, but each such remedy or right shall be in addition to every other remedy or right now or hereafter existing under any such document or under applicable law or in equity.  No delay in the exercise of, or omission to exercise, any remedy or right accruing on any Event of Default shall impair any such remedy or right or be construed to be a waiver of any such Event of Default or an acquiescence therein, nor shall it affect any subsequent Event of Default of the same or a different nature.  Every such remedy or right may be exercised concurrently or independently, and when and as often as may be deemed expedient by the Mortgagee.  All obligations of the Mortgagor, and all rights, powers and remedies of the Mortgagee, expressed herein shall be in addition to, and not in limitation of, those provided by law or in equity or in the Agreement, or any other Loan Documents or any other written agreement or instrument relating to any of the Secured Obligations or any security therefor.

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3.3.    Foreclosure; Receiver.  Upon the occurrence of any Event of Default, the Mortgagee shall also have the right immediately to foreclose this Mortgage or otherwise enforce the lien of this Mortgage. Upon the filing of any complaint for that purpose, the court in which such complaint is filed may, upon application of the Mortgagee or at any time thereafter, either before or after foreclosure sale, and without notice to the Mortgagor or to any party claiming under the Mortgagor and without regard to the solvency or insolvency at the time of such application of any Person then liable for the payment of any of the Secured Obligations, without regard to the then value of the Premises or whether the same shall then be occupied, in whole or in part, as a homestead, by the owner of the equity of redemption, and without regarding any bond from the complainant in such proceedings, appoint a receiver for the benefit of the Mortgagee, with power to take possession, charge, and control of the Premises, to lease the same, to keep the buildings thereon insured and in good repair, and to collect all Rents during the pendency of such foreclosure suit, and, in case of foreclosure sale and a deficiency, during any period of redemption.

The court may, from time to time, authorize said receiver to apply the net amounts remaining in its hands, after deducting reasonable compensation for the receiver and its counsel as allowed by the court, in payment (in whole or in part) of any or all of the Secured Obligations, including without limitation the following, in such order of application as the Mortgagee may elect:  (i) amounts due under the Agreement, (ii) amounts due upon any decree entered in any suit foreclosing this Mortgage, (iii) costs and expenses of foreclosure and litigation upon the Premises, (iv) insurance premiums, repairs, taxes, special assessments, water charges and interest, penalties and costs, in connection with the Premises, (v) any other lien or charge upon the Premises that may be or become superior to the lien of this Mortgage, or of any decree foreclosing the same and (vi) all moneys advanced by the Mortgagee to cure or attempt to cure any Default by the Mortgagor in the performance of any obligation or condition contained in any Agreement, the Loan Documents or this Mortgage or otherwise, to protect the security hereof provided herein, or in any Loan Documents, with interest on such advances at the Default Rate.  The surplus of the proceeds of sale, if any, shall then be paid to the Mortgagor, upon reasonable request.  This Mortgage may be foreclosed once against all, or successively against any portion or portions, of the Premises, as the Mortgagee may elect, until all of the Premises have been foreclosed against and sold.  As part of the foreclosure, the Mortgagee in its discretion may, with or without entry, personally or by attorney, sell to the highest bidder all or any part of the Premises, and all right, title, interest, claim and demand therein, and the right of redemption thereof, as an entirety, or in separate lots, as the Mortgagee may elect, and in one sale or in any number of separate sales held at one time or at any number of times, all in any manner and upon such notice as provided by applicable law.  Upon the completion of any such sale or sales, the Mortgagee shall transfer and deliver, or cause to be transferred and delivered, to the purchaser or purchasers the property so sold, in the manner and form as provided by applicable law, and the Mortgagee is hereby irrevocably appointed the true and lawful attorney-in-fact of the Mortgagor, in its name and stead, to make all necessary transfers of property thus sold, and for that purpose the Mortgagee may execute and deliver, for and in the name of the Mortgagor, all necessary instruments of assignment and transfer, the Mortgagor hereby ratifying and confirming all that said attorney-in- fact shall lawfully do by virtue hereof.  In the case of any sale of the Premises pursuant 

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to any judgment or decree of any court at public auction or otherwise, the Mortgagee may become the purchaser, and for the purpose of making settlement for or payment of the purchase price, shall be entitled to deliver over and use the Agreement and any claims for the debt in order that there may be credited as paid on the purchase price the amount of the debt.  In case of any foreclosure of this Mortgage (or the commencement of or preparation therefor) in any court, all expenses of every kind paid or incurred by the Mortgagee for the enforcement, protection or collection of this security, including court costs, reasonable attorneys' fees, stenographers' fees, costs of advertising, appraisals and environmental investigations, including the costs of the preparation of phase I and phase II surveys of the Premises, and costs of title insurance and any other documentary evidence of title, shall be paid by the Mortgagor. 

3.4.    Possession of the Premises; Remedies for Leases and Rents.  The Mortgagor hereby waives all right to the possession, income, and rents of the Premises from and after the occurrence of any Event of Default, and the Mortgagee is hereby expressly authorized and empowered, at and following any such occurrence, to enter into and upon and take possession of the Premises or any part thereof.  If any Event of Default shall occur, then, whether before or after institution of legal proceedings to foreclose the lien of this Mortgage or before or after the sale thereunder, the Mortgagee shall be entitled, in its sole discretion, to do all or any of the following:  (i) enter and take actual possession of the Premises, the Rents, the Leases and other Collateral relating thereto or any part thereof personally, or by its agents or attorneys, and exclude the Mortgagor therefrom; (ii) with or without process of law, enter upon and take and maintain possession of all of the documents, books, records, papers and accounts of the Mortgagor relating thereto; (iii) as attorney-in-fact or agent of the Mortgagor, or in its own name as mortgagee and under the powers herein granted, hold, operate, manage and control the Premises, the Rents, the Leases and other Collateral relating thereto and conduct the business, if any, thereof either personally or by its agents, contractors or nominees, with full power to use such measures, legal or equitable, as in its sole discretion or in the discretion of its successors or assigns may be deemed proper or necessary to enforce the payment of the Rents, the Leases and other Collateral relating thereto (including actions for the recovery of rent, actions in forcible detainer and actions in distress of rent); (iv) cancel or terminate any Lease or sublease for any cause or on any ground which would entitle the Mortgagor to cancel the same; (v) elect to disaffirm any Lease or sublease made subsequent hereto or subordinated to the lien hereof; (vi) make all necessary or proper repairs, decorations, renewals, replacements, alterations, additions, betterments and improvements to the Premises that, in its discretion, may seem appropriate; (vii) insure and reinsure the Collateral for all risks incidental to the Mortgagee's possession, operation and management thereof; and (viii) receive all such Rents and proceeds, and perform such other acts in connection with the management and operation of the Collateral, as the Mortgagee in its discretion may deem proper, the Mortgagor hereby granting the Mortgagee full power and authority to exercise each and every one of the rights, privileges and powers contained herein at any and all times after any Event of Default without notice to the Mortgagor or any other Person.  The Mortgagee, in the exercise of the rights and powers conferred upon it hereby, shall have full power to use and apply the Rents to the payment, in such order as the Mortgagee may determine, of or on account of any one or more of the following:  (a) to the payment of the operating 

24

expenses of the Premises, including the cost of management and leasing thereof (which shall include reasonable compensation to the Mortgagee and its agents or contractors, if management be delegated to agents or contractors, and it shall also include lease commissions and other compensation and expenses of seeking and procuring tenants and entering into leases), established claims for damages, if any, and premiums on insurance hereinabove authorized; (b) to the payment of taxes, charges and special assessments, the costs of all repairs, decorating, renewals, replacements, alterations, additions, betterments and improvements of the Collateral, including the cost from time to time of installing, replacing or repairing the Collateral, and of placing the Collateral in such condition as will, in the judgment of the Mortgagee, make it readily rentable; and (c) to the payment of any Secured Obligations.  The entering upon and taking possession of the Premises, or any part thereof, and the collection of any Rents and the application thereof as aforesaid shall not cure or waive any Event of Default theretofore or thereafter occurring or affect any notice of Default hereunder or invalidate any act done pursuant to any such Event of Default or notice, and, notwithstanding continuance in possession of the Premises or any part thereof by the Mortgagee or a receiver and the collection, receipt and application of the Rents, the Mortgagee shall be entitled to exercise every right provided for in this Mortgage or by law or in equity upon or after the occurrence of an Event of Default.  Any of the actions referred to in this Section 3.4 may be taken by the Mortgagee irrespective of whether any notice of Default has been given hereunder and without regard to the adequacy of the security for the indebtedness hereby secured.

3.5.    Personal Property.  If any Event of Default shall occur, the Mortgagee may exercise from time to time any rights and remedies available to it under the Loan Documents or applicable law upon default in payment of indebtedness, including, without limitation, those available to a secured party under the Uniform Commercial Code of the state where the goods are located.  The Mortgagor shall, promptly upon request by the Mortgagee, assemble the Collateral and make it available to the Mortgagee at such place or places, reasonably convenient for both the Mortgagee and the Mortgagor, as the Mortgagee shall designate.  The Mortgagor hereby expressly waives, to the fullest extent permitted by applicable law, any and all notices, advertisements, hearings, or process of law in connection with the exercise by the Mortgagee of any of its rights and remedies after an Event of Default occurs.  If any notification of intended disposition of any of the Collateral is required by law, such notification, if mailed, shall be deemed reasonably and properly given if mailed by registered or certified mail, return receipt requested, at least ten (10) days before such disposition, postage prepaid, addressed to the Mortgagor either at the address shown below or at any other address of the Mortgagor appearing on the records of the Mortgagee.  Without limiting the generality of the foregoing, whenever there exists an Event of Default hereunder, the Mortgagee may, with respect to so much of the Collateral as is personal property under applicable law, to the fullest extent permitted by applicable law, without further notice, advertisement, hearing or process of law of any kind, (i) notify any Person obligated on the Collateral to perform directly for the Mortgagee its obligations thereunder, (ii) enforce collection of any of the Collateral by suit or otherwise, and surrender, release or exchange all or any part thereof or compromise or extend or renew for any period (whether or not longer than the original period) any obligations of any nature of any party with respect thereto, (iii) endorse any checks, drafts or other writings in the name of 

25

the Mortgagor to allow collection of the Collateral, (iv) take control of any proceeds of the Collateral, (v) enter upon any premises where any of the Collateral may be located and take possession of and remove such Collateral and render all or any part of the Collateral unusable, all without being responsible for loss or damage, (vi) sell any or all of the Collateral, free of all rights and claims of the Mortgagor therein and thereto, at any lawful public or private sale and on such terms as the Mortgagee deems advisable, and (vii) bid for and purchase any or all of the Collateral at any such public or private sale.  Any proceeds of any disposition by the Mortgagee of any of the Collateral may be applied by the Mortgagee to the payment of expenses in connection with the Collateral, including reasonable attorneys' fees and legal expenses, and any balance of such proceeds shall be applied by the Mortgagee toward the payment of such of the Secured Obligations and in such order of application as the Mortgagee may from time to time elect.  Without limiting the foregoing, the Mortgagee may exercise from time to time any rights and remedies available to it under the Uniform Commercial Code or other applicable law as in effect from time to time or otherwise available to it under applicable law.  The Mortgagor hereby expressly waives presentment, demand, notice of dishonor, protest and notice of protest in connection with the Note and, to the fullest extent permitted by applicable law, any and all other notices, demands, advertisements, hearings or process of law in connection with the exercise by the Mortgagee of any of its rights and remedies hereunder.  The Mortgagor hereby constitutes the Mortgagee its attorney-in-fact with full power of substitution to take possession of the Collateral upon any Event of Default and, as the Mortgagee in its sole discretion deems necessary or proper, to execute and deliver all instruments required by the Mortgagee to accomplish the disposition of the Collateral; this power of attorney is a power coupled with an interest and is irrevocable while any of the Secured Obligations are outstanding.  The Mortgagor shall remain liable for any deficiency resulting from the sale of the Collateral and shall pay such deficiency forthwith upon demand, and the Mortgagee's right to recover such deficiency shall not be impaired by the sale or other disposition of Collateral without required notice.  Expenses of retaking, holding, preparing for sale, selling or the like will first be paid from the proceeds before the balance will be applied toward any Secured Obligations.

3.6.    No Liability on Mortgagee.  Notwithstanding anything contained herein, the Mortgagee shall not be obligated to perform or discharge, and does not hereby undertake to perform or discharge, any obligation, duty or liability of the Mortgagor, whether hereunder, under any of the Third Party Agreements or otherwise.  The Mortgagee shall not have responsibility for the control, care, management or repair of the Premises (including but not limited to use, storage, manufacture, discharge or transportation of hazardous waste or substances, including, without limitation, Hazardous Substances, by the Mortgagor) or be responsible or liable for any negligence in the management, operation, upkeep, repair or control of the Premises resulting in loss, injury or death to any tenant, licensee, employee, stranger or other Person.  No liability shall be enforced or asserted against the Mortgagee in its exercise of the powers granted to it under this Mortgage, and the Mortgagor expressly waives and releases any such liability.  Should the Mortgagee incur any such liability, loss or damage under any of the Third Party Agreements or under or by reason hereof, or in the defense of any claims or demands, the Mortgagor agrees to reimburse the Mortgagee 

26

immediately upon demand for the full amount thereof, including costs, expenses and reasonable attorneys' fees.

3.7.    Transfer of Premises by Mortgagor.  To induce the Mortgagee to extend credit under the Agreement, the Mortgagor agrees that in the event of any transfer (by assignment, sale, lease, operation of law or otherwise) of the Leasehold Estate or the Premises without the prior written consent of the Mortgagee, which was not otherwise permitted by the Loan Documents, the Mortgagee shall have the absolute right at its option, without prior demand or notice, to declare all sums secured hereby immediately due and payable.  Any transfer consented to by the Mortgagee shall be made subject to this Mortgage, and any such transferee shall assume the obligations of the Mortgagor hereunder, without releasing the Mortgagor therefrom.

ARTICLE IV

GENERAL

4.1.    Permitted Acts.  The Mortgagor agrees that, without affecting or diminishing in any way the liability of the Mortgagor or any other Person, except any Person expressly released in writing by the Mortgagee (with the consent of any pledgee of the Secured Obligations), for the payment or performance of any of the Secured Obligations or for the performance of any obligation contained herein or affecting the lien hereof upon the Collateral or any part thereof, the Mortgagee may at any time and from time to time, without notice to or the consent of any Person, release any Person liable for the payment or performance of the Agreement or any of the other Secured Obligations or any guaranty given in connection therewith; extend the time for, or agree to alter the terms of payment of, any indebtedness under the Agreement or any of the other Secured Obligations or any guaranty given in connection therewith; modify or waive any obligation; subordinate, modify or otherwise deal with the lien hereof; accept additional security of any kind for repayment under the Agreement or the other Secured Obligations or any guaranty given in connection therewith; release any Collateral or other property securing any or all of the Agreement or the other Secured Obligations or any guaranty given in connection therewith; make releases of any portion of the Premises; consent to the making of any map or plat of the Premises; consent to the creation of any easements on the Premises or of any covenants restricting the use or occupancy thereof; or exercise or refrain from exercising, or waive, any right the Mortgagee may have. 

4.2.    Legal Expenses.  The Mortgagor agrees to indemnify the Mortgagee from all loss, damage and expense, including (without limitation) reasonable attorneys' fees, incurred in connection with any suit or proceeding in or to which the Mortgagee may be made or become a party for the purpose of protecting the lien or priority of this Mortgage. 

4.3.    Security Agreement; Fixture Filing; Future Advances.

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(a)    This Mortgage, to the extent that it conveys or otherwise deals with personal property or with items of personal property which are or may become fixtures, shall also be construed as a security agreement under the Uniform Commercial Code as in effect in the state in which the Premises are located, and this Mortgage constitutes a financing statement filed as a fixture filing in the Official Records of the County Recorder of the County in which the Premises are located with respect to any and all fixtures included within the term "Collateral" as used herein and with respect to any Goods or other personal property that may now be or hereafter become such fixtures.  For purposes of the foregoing, the Mortgagor is the debtor (with its address as set forth below), the Mortgagee is the secured party (with its address as set forth below).  If any item of Collateral hereunder also constitutes collateral granted to the Mortgagee under any other mortgage, agreement, document, or instrument, in the event of any conflict between the provisions of this Mortgage and the provisions of such other mortgage, agreement, document, or instrument relating to the Collateral, the provision or provisions selected by the Mortgagee shall control with respect to the Collateral.

(b)    This Mortgage is granted to secure, among other Secured Obligations, future advances and loans (whether obligatory, made at the option of Mortgagee or otherwise) from the Mortgagee to or for the benefit of the Mortgagor or its successors or assigns or the Premises, as provided in the Agreement, and costs and expenses of enforcing the Mortgagor's obligations under this Mortgage, the Agreement and the other Loan Documents.  All advances, disbursements or other payments required by the Agreement are obligatory advances up to the credit limits established therein and shall, to the fullest extent permitted by law, have priority over any and all construction and mechanics' liens and other liens and encumbrances arising after this Mortgage is recorded.

4.4.    Defeasance.  Upon full payment of all indebtedness secured hereby and satisfaction of all the Secured Obligations in accordance with their respective terms and at the time and in the manner provided, and when the Mortgagee has no further obligation to make any advance, or extend any credit hereunder, secured by the Agreement or any Loan Documents, this conveyance shall be null and void, and thereafter, upon demand therefor, an appropriate instrument of reconveyance or release shall promptly be made by the Mortgagee to the Mortgagor, at the expense of the Mortgagor.

4.5.    Notices.  All notices, demands and other communications provided for hereunder shall be given in accordance with the notice provisions of the Agreement to the parties hereto at the addresses set forth on the signature page hereof.

4.6.    Successors; the Mortgagor; Gender; Severability.  All provisions hereof shall bind the Mortgagor and the Mortgagee and their respective successors, vendees and assigns and shall inure to the benefit of the Mortgagee, its successors and assigns, and the Mortgagor and its permitted successors and assigns.  THE MORTGAGOR CONSENTS TO THE ASSIGNMENT BY THE MORTGAGEE OF ALL OR ANY PORTION OF ITS RIGHTS UNDER THIS MORTGAGE AND THE AGREEMENT AND OTHER LOAN DOCUMENTS.  THE MORTGAGOR 

28

ACKNOWLEDGES AND AGREES THAT ANY AND ALL RIGHTS OF THE MORTGAGEE UNDER THIS MORTGAGE AND AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY BE EXERCISED FROM TIME TO TIME BY ANY ASSIGNEE OR SUCCESSOR OF THE MORTGAGEE.  The Mortgagor shall not have any right to assign any of its rights hereunder. Except as limited by the preceding sentence, the word "Mortgagor" shall include all Persons claiming under or through the Mortgagor and all Persons liable for the payment or performance by the Mortgagor of any of the Secured Obligations whether or not such Persons shall have executed the Agreement or this Mortgage.  Wherever used, the singular number shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.  Whenever possible, each provision of this Mortgage shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Mortgage shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity only, without invalidating the remainder of such provision or the remaining provisions of this Mortgage, it being the parties' intention that this Mortgage and each provision hereof be effective and enforced to the fullest extent permitted by applicable law.

4.7.    Care by the Mortgagee.  The Mortgagee shall be deemed to have exercised reasonable care in the custody and preservation of any of the Collateral assigned by the Mortgagor to the Mortgagee or in the Mortgagee's possession if it takes such action for that purpose as the Mortgagor requests in writing, but failure of the Mortgagee to comply with any such request shall not be deemed to be (or to be evidence of) a failure to exercise reasonable care, and no failure of the Mortgagee to preserve or protect any rights with respect to such Collateral against prior parties, or to do any act with respect to the preservation of such Collateral not so requested by the Mortgagor, shall be deemed a failure to exercise reasonable care in the custody or preservation of such Collateral. 

4.8.    No Waiver; Writing.  No delay on the part of the Mortgagee in the exercise of any right or remedy shall operate as a waiver thereof, and no single or partial exercise by the Mortgagee of any right or remedy shall preclude other or further exercise thereof or the exercise of any other right or remedy.  The granting or withholding of consent by the Mortgagee to any transaction as required by the terms hereof shall not be deemed a waiver of the right to require consent to future or successive transactions. 

4.9.    Governing Law.  This Mortgage shall be a contract made under and governed by the internal laws of the State where the Premises are located.  

4.10.    Waiver.  The Mortgagor, on behalf of itself and all Persons now or hereafter interested in the Premises or the Collateral, to the fullest extent permitted by applicable law hereby waives all rights under all appraisement, homestead, moratorium, valuation, exemption, stay, extension, and redemption statutes, laws or equities now or hereafter existing, and hereby further waives the pleading of any statute of limitations as a defense to any and all Secured Obligations secured by this Mortgage, and the Mortgagor agrees that no defense, claim or right based on any thereof will be asserted, or may be enforced, in any action enforcing or relating to this Mortgage or any of this 

29

Collateral.  Without limiting the generality of the preceding sentence, the Mortgagor, on its own behalf and on behalf of each and every Person acquiring any interest in or title to the Premises subsequent to the date of this Mortgage, hereby irrevocably waives any and all rights of redemption from sale under any order or decree of foreclosure of this Mortgage or under any power contained herein or under any sale pursuant to any statute, order, decree or judgment of any court.  The Mortgagor, for itself and for all Persons hereafter claiming through or under it or who may at any time hereafter become holders of liens junior to the lien of this Mortgage, hereby expressly waives and releases all rights to direct the order in which any of the Collateral shall be sold in the event of any sale or sales pursuant hereto and to have any of the Collateral and/or any other property now or hereafter constituting security for any of the indebtedness secured hereby marshaled upon any foreclosure of this Mortgage or of any other security for any of said indebtedness.

4.11.    JURY TRIAL.  THE MORTGAGOR HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS MORTGAGE, THE AGREEMENT OR ANY LOAN DOCUMENTS TO WHICH IT IS A PARTY, OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY RELATIONSHIP EXISTING IN CONNECTION WITH THIS MORTGAGE OR ANY RELATED DOCUMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

4.12.    No Merger.  It being the desire and intention of the parties hereto that this Mortgage and the lien hereof do not merge in fee simple or leasehold title to the Premises, it is hereby understood and agreed that should the Mortgagee acquire an additional or other interests in or to the Premises or the ownership thereof, then, unless a contrary intent is manifested by the Mortgagee as evidenced by an express statement to that effect in an appropriate document duly recorded, this Mortgage and the lien hereof shall not merge in the fee simple or leasehold title, toward the end that this Mortgage may be foreclosed as if owned by a stranger to the fee simple or leasehold title.  So long as any of the indebtedness secured by this Mortgage shall remain unpaid, unless the Mortgagee shall otherwise in writing consent, the fee or leasehold title and the Leasehold Estate, in the Premises hereinbefore described, shall not merge but shall always be kept separate and distinct, notwithstanding the union of said estates either in the lessor or in the lessee, or in a third party, by purchase or otherwise; and the Mortgagor further covenants and agrees that, in case it shall acquire the fee title, or any other estate, title or interest in the premises covered by the Facility Lease, this Mortgage shall attach to and cover and be a first lien upon such other estate so acquired, and such other estate so acquired by the Mortgagor shall be considered as mortgaged, assigned or conveyed to the Mortgagee and the lien hereof spread to cover such estate with the same force and effect as though specifically herein mortgaged, assigned or conveyed and spread.

4.13.    Time of Essence and Severability.  Time is declared to be of the essence in this Mortgage, the Agreement and the Loan Documents and of every part hereof and thereof.  If the 

30

Mortgagee chooses to waive any covenant, section or provision of this Mortgage, or if any covenant, section or provision of this Mortgage is construed by a court of competent jurisdiction to be invalid or unenforceable, it shall not affect the applicability, validity or enforceability of the remaining covenants, sections or provisions.

4.14.    Matters to Be in Writing.  This Mortgage cannot be altered, amended, modified, terminated, waived, released or discharged except in a writing signed by the party against whom enforcement is sought.

4.15.    Sole Discretion of Mortgagee.  Whenever the Mortgagee's judgment, consent or approval is required hereunder for any matter, or the Mortgagee shall have an option or election hereunder, such judgment, the decision as to whether or not to consent to or approve the same or the exercise of such option or election shall, unless specifically and expressly stated to the contrary herein, be in the sole discretion of the Mortgagee.

This Leasehold Mortgage was prepared by James A. Hogg, Esq. whose address is 388 South Main St., Ste 500, Akron OH 44311.

IN WITNESS WHEREOF, the undersigned have executed and delivered this Mortgage on the day and year first above written.

31

	
		
	

	"MORTGAGOR":

AIR TRANSPORT INTERNATIONAL LIMITED LIABILITY COMPANY 
a Nevada limited liability company

By: /s/ W. Joseph Payne_______________________
     W. Joseph Payne, Manager_________________ 
      [Printed Name and Title]

Address of Mortgagor/Debtor:

145 Hunter Drive                                                           
Wilmington, Ohio 45177______________________                                   

Address of Mortgagee/Secured Party:

THE DIRECTOR OF DEVELOPMENT SERVICES AGENCY OF THE STATE OF OHIO
Ohio Development Services Agency Loans & Servicing Office
77 South High Street, 28th floor
Columbus, OH 43215-6130

	 
	 

#841913v6

32

	
		
	State of Ohio      _____
County of Franklin_____

On 12/21/12___ before me, Kristin L. Woeste, Notary___________________                                                                      
             Date                                  Name, Title of Officer-e.g. "Jane Doe, Notary"

personally appeared W. Joseph Payne, Manager of Air Transport International Limited Liability Company

   personally known to me   -OR-     proved to me on basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

                  Witness my hand and official seal.

                  /s/ Kristin L. Woeste__________
                      SIGNATURE OF NOTARY

	CAPACITY CLAIMED BY SIGNER

 INDIVIDUAL

 CORPORATE 
 OFFICER(S)

 PARTNER(S)
 

 ATTORNEY-IN-FACT

 TRUSTEE(S)

 SUBSCRIBING WITNESS

 GUARDIAN/
 CONSERVATOR

X

 OTHER Manager
 ________________

SIGNER IS REPRESENTING:
___________________________ ___________________________

	ATTENTION NOTARY:  Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this certificate to unauthorized documents.

THIS CERTIFICATE MUST            Title or Type of Document __________________________
BE ATTACHED TO THE            Number of Pages _____ Date of Document _____________
DOCUMENT AT THE RIGHT:         Signer(s) Other Than Named Above:________________________________________

33

EXHIBIT A

DESCRIPTION OF LAND

4.457 ACRES

Situated in the State of Ohio, County of Clinton, City of Wilmington, lying in Virginia Military Survey 1162, and being part of that original 1105.562 acre tract conveyed as Tract 1 to Clinton County Port Authority of record in Official Record 783, Page 266, Official Record 796, Page 167 and Official Record 796, Page 188 (all references are to the records of the Recorder's Office, Clinton County, Ohio) and being more particularly described as follows:

Beginning, for reference, at the centerline intersection of Airborne Road (Width Varies) with Old State Route 73 (County Road 35) (60 feet wide);

Thence with the centerline of Old State Route 73, the following courses and distances:

North 53° 39' 54" West, a distance of 355.80 feet, to a railroad spike found;

Thence North 48° 05' 26" West, a distance of 669.31 feet, to a railroad spike found on the southerly line of said Tract 1, being the corner common of that 1.000 acre tract conveyed to Airline Professionals Association Teamsters Local 1224 of record in Official Record 328, Page 711, and that 6.518 acre tract conveyed to EWE Warehouse Investments V, Ltd. of record in Official Record 312, Page 131, being the TRUE POINT OF BEGINNING;

Thence South 48° 20' 11" West, with the northerly line of said 1.000 acre tract, a distance of 19.27 feet, to a 1/2 inch rebar capped "CLINCO" at a southeasterly corner of that original 266.282 acre tract conveyed to Great Oaks Joint Vocational School District, Ohio by deed of record in Deed Book 239, Page 482;

Thence North 48° 06' 06" West, along the easterly line of said Great Oaks Joint Vocational School District, and with the easterly line of that 5.267 acre tract conveyed to The Board of County Commissioners of Clinton County, Ohio of record in Official Record 672, Page 152 and across said Tract 1, a distance of 701.08 feet, to an iron pin set;

Thence across said Tract 1, the following courses and distances:

South 45° 37' 34" West, a distance of 473.26 feet, to an iron pin set;

North 44° 20' 57" West, a distance of 345.43 feet, to an iron pin set;

North 45° 39' 03" East, a distance of 467.62 feet, to an iron pin set;

34

South 49° 51' 22" East, a distance of 1051.38 feet, to an iron pin set in the northerly line of said 6.518 acre tract;

Thence South 47° 11' 41" West, along the northerly line of said 6.518 acre tract, a distance of 30.13 feet to the TRUE POINT OF BEGINNING and containing 4.457 acres of land, more or less.

Subject, however, to all legal rights-of-way and/or easements, if any, of previous record.

Iron pins set, where indicated, are iron pipes, thirteen sixteenths (13/16) inch inside diameter, thirty (30) inches long with a plastic plug placed in the top bearing the initials EMH&T INC.

This description is based on existing records and an actual field survey performed by EMH&T in November 2009, and June 2012

The bearings contained herein are based on the Ohio State Plane Coordinate System, South Zone, NAD83 (1995).  Said bearings originated from a field traverse which was tied (referenced) to said coordinate system by GPS observations and observations of selected NGS monuments AIRBORNE and AIRBORNE AZ MK.  The portion of the right-of-way line of Airborne Road, having a bearing of North 38° 08' 03" East, is designated the "basis of bearing" for this survey.

Common Address:    Hunter Drive, Wilmington, OH
 
Real Estate Tax Index No(s).:    Auditor’s Parcel No. is 290-019437-7

35

EXHIBIT B

DESCRIPTION OF LEASES OR SUBLEASES
Lease Agreement, dated as of December 1, 2012, between Mortgagor, as lessee, and Clinton County Port Authority, as lessor, as the same may be amended from time to time in accordance with its terms, relating to the Land and improvements thereto.
Sublease, dated as of December 1, 2012, between Mortgagor, as sublessor, and Airborne Maintenance and Engineering Services, Inc., as sublessee, as the same may be amended from time to time in accordance with its terms, relating to the Land and improvements thereto.

36Ex1041BondPurchaseAgmt

Exhibit 10.41

Execution Copy
BOND PURCHASE AGREEMENT
State of Ohio 
$9,055,000 
State Economic Development Revenue Bonds 
(Ohio Enterprise Bond Fund) 
Series 2012-9 
(Clinton County Port Authority - AMES Project) 
(Tax-Exempt Bonds)

This BOND PURCHASE AGREEMENT (this “Bond Purchase Agreement”) dated December 13, 2012 among the State of Ohio (the “Issuer” or the “State”), acting by and through its Treasurer of State (the “Treasurer”), the Development Services Agency of the State, acting by and through a duly authorized representative (the “Director of Development Services Agency”), Clinton County Port Authority (the “Borrower”), Air Transport International Limited Liability Company (the “Lessee”) and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”).
Words and terms not defined elsewhere in this Bond Purchase Agreement shall have the meanings assigned to them in either the Trust Agreement or the Loan Agreement, both as hereinafter defined.
1.Background.
(a)    The Issuer proposes to issue and sell $9,055,000 aggregate principal amount of its State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) (the “Bonds”) for the purpose of providing moneys to fund a loan by the Director to the Borrower to finance a portion of the costs of (i) constructing the Project and certain other improvements to the Wilmington Air Park related to the Project (the “Related Improvements”), and (ii) issuance of the Bonds.  The Borrower will lease the Project to the Lessee pursuant to the Lease Agreement dated as of December 1, 2012 (the “Lease Agreement”) between the Borrower and the Lessee.  The Lessee will subsequently sublease the Project to Airborne Maintenance and Engineering Services, Inc. (the “Operating Company” or “AMES”).
(b)    The Bonds will be issued pursuant to the General Bond Order of the Treasurer, dated April 11, 1988, as supplemented by the Series Bond Order R9-12 dated December 13, 2012 (collectively, the “Order”), and will be secured by the Trust Agreement dated as of April 1, 1988 (the “Original Trust Agreement”) between the Issuer and The Huntington National Bank, as successor trustee (the “Trustee”), as supplemented by the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012 (the “Supplement,” and together with the Original Trust Agreement, the “Trust Agreement”).  Certain proceeds from the issuance and sale of the Bonds will be loaned by the Director to the Borrower pursuant to a Loan

        

Agreement dated as of December 1, 2012 (the “Loan Agreement”) between the Director and the Borrower.  The Bonds will be payable from the monthly loan payments paid by the Borrower to the Issuer to the extent the Borrower receives payments from the Lessee pursuant to the Lease Agreement, all as provided for in the Loan Agreement.  Under the Loan Agreement and the Lease Agreement, the Borrower will cause the Lessee to deliver to the Trustee cash or a letter of credit in the amount of not less than $905,500, which will be held by the Trustee to the credit of the Primary Reserve Account established for the Bonds under the Supplement.
Payments due under the Loan Agreement will be secured by: (i) the Loan Agreement, (ii) the Leasehold Mortgage, dated as of even date with the Loan Agreement, from the Lessee to the Director, granting a first mortgage and security interest in Lessee’s leasehold interest in the Project in favor of the Director, and (iii) the Guaranty Agreement dated as of December 1, 2012 entered into by the Lessee, the Operating Company, and Air Transport Services Group, Inc. (“ATSG”), for the benefit of the Borrower, the Director, and the Trustee.  
(c)    In order to induce the Issuer and the Underwriter to enter into this Bond Purchase Agreement, to induce the Issuer to issue, sell and deliver the Bonds, and to induce the Underwriter to purchase and pay for the Bonds, the Issuer, the Borrower, the Lessee,  and the Underwriter have executed this Bond Purchase Agreement.
(d)    The Bonds will be described in the Official Statement (defined below) and in the Order, and the Bonds will be issued and secured under and pursuant to the Order, as amended from time to time in accordance with the provisions thereof. The Treasurer shall deliver an Official Statement (including the cover page and all summary statements and appendices included therein or attached thereto), as amended or supplemented from time to time in accordance herewith, which is hereinafter referred to as the “Official Statement.”
(e)    The Treasurer has delivered to the Underwriter a Preliminary Official Statement, dated November 29, 2012 (including the cover page and all appendices thereto, the “Preliminary Official Statement”). The Treasurer confirms that the Preliminary Official Statement was “deemed final” as of its date by the Treasurer for purposes of Securities and Exchange Commission (“SEC”) Rule 15c2-12(b)(1). The final Official Statement required to be delivered by the Treasurer pursuant to this Bond Purchase Agreement will be the Preliminary Official Statement, completed with information established at the time of sale of the Bonds with only such amendments or supplements as the Underwriter shall have approved, and will be a final Official Statement for purposes of the Underwriter’s compliance with SEC Rule 15c2-12(b)(3) and (4).  There has not been and, as of the Closing Date (as hereinafter defined), there shall not have been, any instance in which the Treasurer failed to comply, in all material respects, with any previous undertaking made by the Treasurer for the purposes of SEC Rule 15c2-12.
(f)    The Treasurer authorizes the Underwriter to use copies of the Official Statement and other necessary documents in connection with the public offering and sale of the Bonds and agrees not to supplement or amend or cause to be supplemented or amended the Official Statement, at any time prior to the Closing (as hereinafter defined), without the prior written consent of the Underwriter, which shall not be unreasonably withheld. The Treasurer ratifies and confirms the use by the Underwriter, prior to the date hereof, of the Preliminary Official Statement.

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(g)    The Treasurer agrees to provide to the Underwriter, not later than the Closing Date, sufficient copies of the Official Statement to enable the Underwriter to comply with the requirements of SEC Rule 15c2-12(b)(4) and with the requirements of Rule G-32 of the Municipal Securities Rulemaking Board. The Treasurer hereby ratifies its actions taken in connection with “deeming final” the Preliminary Official Statement, within the meaning and for purposes of SEC Rule 15c2-12(b)(1), subject to completion thereof with the information established at the time of sale of the Bonds.
(h)    Unless otherwise provided for in this Bond Purchase Agreement, upon acceptance by the Treasurer of this Bond Purchase Agreement, the Underwriter covenants and agrees to make a bona fide public offering of the Bonds at the prices set forth on the inside cover page of the Official Statement and to deliver a copy of the Official Statement to each original purchaser of the Bonds from the Underwriter concurrently with or prior to sending to such original purchaser a final written confirmation of the sale, and otherwise to comply with all the applicable state and Federal securities laws, rules and regulations. If, in accordance with the foregoing covenants, the Underwriter delivers a Preliminary Official Statement to any original purchaser of the Bonds, the Underwriter also shall deliver to such original purchaser a final Official Statement promptly after the same shall have become available.
(i)    If, between the date of this Bond Purchase Agreement and 25 days following the “end of the underwriting period” as that term is defined in SEC Rule 15c2-12(f)(2), any event or potential event known to the Treasurer or the Director relating to or affecting the Treasurer, the Director, the Bonds or the Order shall occur, which might affect the accuracy or completeness of any material statement contained in the Official Statement, the Treasurer or the Director, as applicable, shall promptly notify the Underwriter in writing of the circumstances and details of such event.  If, as a result of such event or any other event, it is necessary, in the opinion of Bond Counsel or counsel to the Underwriter, to amend or supplement the Official Statement in order to correct any untrue statement of a material fact or to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and any such counsel shall have so advised the Treasurer and the Director, the Treasurer and the Director shall forthwith prepare and furnish to the Underwriter a reasonable number of copies of an amendment of or a supplement to such Official Statement which will so amend or supplement such Official Statement so that, as amended or supplemented, it will not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(j)    The Underwriter reserves the right, without changing the purchase price hereunder, to change the initial offering prices or yields as the Underwriter shall deem necessary in connection with the marketing of the Bonds and to offer and sell the Bonds to certain dealers (including dealers depositing the Bonds into investment trusts) and others at prices lower than the initial offering prices or yields set forth in the Official Statement. The Underwriter also reserves the right (i) to over-allot or effect transactions that stabilize or maintain the market price of the Bonds at a level above that which might otherwise prevail in the open market and (ii) to discontinue such stabilizing, if commenced, at any time.

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(k)    The Underwriter agrees to provide to the Treasurer information as to bona fide initial offering prices to the public and sales of the Bonds appropriate for the determination of yield on the Bonds under the Internal Revenue Code of 1986, as amended (the “Code”), satisfactory to and at the time requested by Bond Counsel.
(l)    The Underwriter represents and warrants that it (i) is in compliance with all of the rules and regulations of the Municipal Securities Rulemaking Board (“MSRB”), and (ii) has procedures in place that provide reasonable assurance that it will receive prompt notice of any event disclosed pursuant to SEC Rule 15c2-12(b)(5)(i)(C), (b)(5)(i)(D) and (d)(2)(ii)(B) with respect to the Bonds.
(m)    The Issuer, the Director and the Borrower agree that proceeds from the sale of the Bonds are to be used to provide a portion of the funds necessary for the Project and to pay a portion of the costs (not to exceed 2% of the proceeds of the Bonds) related to the issuance of the Bonds.  Included in the costs related to the issuance of the Bonds are the costs of preparing and reproducing or printing the Trust Agreement, the Loan Agreement, the Bonds, the Order, the Official Statement and other resolutions of the Issuer, administrative fees, and expenses, the Underwriter’s fees and expenses, the fees and disbursements of Bond Counsel, counsel to the Director and counsel to the Underwriter, the Financial Advisor’s fees, and other expenses for which payment or reimbursement is permitted under the provisions of the Loan Agreement, including without limitation the Trustee’s acceptance fee. 
(n)    The agreements of the Treasurer set forth in the Trust Agreement, constitute the “Continuing Disclosure Agreement” made by the Treasurer for the benefit of holders and beneficial owners of the Bonds in accordance with SEC Rule 15c2-12, under which the Treasurer has agreed to provide the following information for dissemination as required by the Continuing Disclosure Agreement: (i) Annual Information (as defined in the Continuing Disclosure Agreement); (ii) timely notice of the occurrence of certain material events with respect to the Bonds and the Issuer; and (iii) timely notice of any failure of the Issuer to provide the Annual Information, including the financial information required therein, on or before the date specified in the Continuing Disclosure Agreement.  References herein to the Trust Agreement include, without limitation, the Continuing Disclosure Agreement.

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2.    Purchase; Sale and Closing.
(a)    Subject to the terms and conditions and in reliance on the representations, warranties and covenants hereinafter set forth, including the maturity dates, principal amounts, yields to maturity and interest rates set forth in the Order, the Underwriter hereby agrees to purchase from the Treasurer, and the Treasurer hereby agrees to sell to the Underwriter, the entire $9,055,000.00 aggregate principal amount of Bonds, at the aggregate purchase price of $9,027,817.80, representing the par amount of the Bonds ($9,055,000.00), plus the net original issue premium of $36,202.80, less the Underwriter’s discount ($63,385.00).  The Bonds shall be subject to redemption as set forth in the General Bond Order and the Supplement.  
(b)    On December 27, 2012, or at such other date as shall have been mutually agreed upon by the Treasurer and the Underwriter (the “Closing Date”), the Treasurer shall deliver, or cause to be delivered, the Bonds to The Depository Trust Company, New York, New York (“DTC”) for the account of the Underwriter in definitive form duly executed on the Treasurer’s behalf, together with the other documents hereinafter mentioned, and provided that all conditions to the obligations of the Underwriter set forth in Section 10 hereof have been met, the Underwriter shall accept such delivery and pay the purchase price of the Bonds as set forth in Section 2(a) hereof by delivering such amount in immediately available funds to the Treasurer (the “Closing”).  The Bonds will be delivered as fully registered Bonds, one for each maturity and interest rate of Bonds, under a book entry method, registered initially in the name of Cede & Co. as nominee for DTC.
(c)    Inasmuch as this purchase and sale represents a negotiated transaction, the Issuer and the Director acknowledge and agree that: (i) the transaction contemplated by this Agreement is an arm’s length, commercial transaction between the  Issuer, the Director and the Underwriter in which the Underwriter is acting solely as a principal and not acting as a fiduciary to the Issuer or the Director; (ii) the Underwriter has provided advice with respect to the structure, timing or other similar matters concerning the Bonds as an underwriter and not as a fiduciary to the Issuer or the Director; (iii) the Underwriter is acting solely in its capacity as an underwriter for its own account; (iv) the only obligations the Underwriter has to the Issuer and the Director with respect to the transaction contemplated hereby expressly are set forth in this Agreement; and (v) the Issuer and the Director have consulted with their own legal, accounting, tax, financial and other advisors, as applicable, to the extent deemed appropriate.
3.    Issuer’s Representations and Warranties.
The Issuer, by and through the Treasurer and the Director, as applicable, hereby make the following representations and warranties:
(a)    The Issuer, the Treasurer and the Director are authorized by the provisions of Chapter 166 of the Ohio Revised Code (the “Act”), among other things, (i) to issue revenue bonds, such as the Bonds, and to use the proceeds of such Bonds for the purposes described in the Order and the Loan Agreement, payable from loan payments from persons such as the Borrower and 

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secured by a pledge of said payments, and (ii) to secure such Bonds in the manner contemplated by the Trust Agreement.
(b)    The Issuer, the Treasurer and the Director have full legal right, power and authority (i) to adopt the Order; (ii) to enter into this Bond Purchase Agreement, the Trust Agreement, and the Loan Agreement; (iii) to issue, sell and deliver the Bonds as provided herein; and (iv) to carry out and consummate all other transactions contemplated by each of the aforesaid documents, and the Issuer, the Treasurer and the Director have complied with all provisions of applicable law, including the Act, in all matters relating to such transactions.
(c)    The Issuer, the Treasurer and the Director have duly authorized (i) the issuance and sale of the Bonds upon the terms set forth herein and in the Trust Agreement, (ii) the execution, delivery and due performance of this Bond Purchase Agreement, the Bonds, the Trust Agreement, and the Loan Agreement; and (iii) the taking of any and all such action as may be required on the part of the Issuer to carry out, give effect to and consummate the transactions contemplated by such instruments.  All consents or approvals, if any, necessary to be obtained by the Issuer, the Treasurer and the Director in connection with the foregoing have been received or will be received prior to the Closing, and the consents or approvals so received, if any, will be in full force and effect as of the Closing.
(d)    The Order has been duly adopted by the Treasurer, is in full force and effect and constitutes the legal, valid and binding act of the Issuer.
(e)    When delivered to and paid for by the Underwriter at the Closing in accordance with the provisions of this Bond Purchase Agreement, the Bonds will be duly authorized, executed, issued and delivered and will constitute legal, valid and binding obligations of the Treasurer in accordance with their terms.
(f)    To the best knowledge of the Issuer, the Treasurer and the Director, none of the adoption of the Order, the execution and delivery of this Bond Purchase Agreement, the Bonds, the Trust Agreement or the Loan Agreement, or the consummation of the transactions contemplated hereby or thereby or the compliance with the provisions hereof or thereof, will conflict with, or constitute on the part of the Issuer, the Treasurer or the Director a violation of, or a breach of or default under, any indenture, mortgage, commitment, note or other agreement or instrument to which the Issuer is a party or by which it is bound, or under any provision of the Constitution of Ohio or under any existing law, rule, regulation, resolution, judgment, order or decree to which the Issuer is subject.
(g)    There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, pending or to the best of the knowledge of the Treasurer and the Director, threatened against the Issuer, the Treasurer or the Director which in any way questions the powers of the Issuer, the Treasurer or the Director referred to in subsections (a) and (b) above, or the validity of any proceedings taken by the Issuer, the Treasurer or the Director in connection with the issuance of the Bonds, or wherein an unfavorable decision, ruling or finding would materially adversely affect the transactions contemplated by, or the validity or 

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enforceability of, the Order, the Trust Agreement, the Loan Agreement, the Bonds or this Bond Purchase Agreement. 
(h)    Any certificate relating to the Bonds executed by any official of the Issuer, the Treasurer or the Director and delivered to the Underwriter on or before the Closing Date shall be deemed a representation and warranty by the Issuer, the Treasurer or the Director, respectively, to the Underwriter and the Borrower as to the truth of the statements therein contained.
(i)    The Preliminary Official Statement, as of its date, and the Official Statement, as of the date hereof and at all times subsequent thereto through and including the Closing Date, will be true, correct and complete in all material respects for the purposes for which use thereof is authorized; and the Official Statement does not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they are made, not misleading; provided, however, that no representation is made as to information contained under the headings “SUMMARY STATEMENT - The Borrower,” “SUMMARY STATEMENT - The Lessee,” “SUMMARY STATEMENT - The Project,” “THE PROJECT,” “THE BORROWER,” “THE LESSEE,” “SOURCES AND USES OF FUNDS,” “TAX MATTERS,” “ELIGIBILITY UNDER OHIO LAW FOR INVESTMENT AND AS SECURITY FOR THE DEPOSIT OF PUBLIC MONEYS,” “LEGAL MATTERS” and “RATING.”  In making the foregoing representation and warranty, insofar as it relates to information contained under the headings “THE OHIO ENTERPRISE BOND FUND PROGRAM,” “SUMMARY OF CHAPTER 166 PROGRAMS,” and “CHAPTER 166 DIRECT LOAN PROGRAM NET REVENUES,” the Treasurer is relying entirely on the representation and warranty regarding such information given by the Director.
(j)    Neither the Issuer, the Treasurer nor the Director is a party to any contract or agreement or is subject to any restriction not disclosed in the Official Statement, the performance of or compliance with which would have a material adverse effect on the financial condition, operations or prospects of the Chapter 166 economic development programs or the Ohio Enterprise Bond Fund program.
(k)    As long as any of the Bonds are outstanding, subject to any statutory provisions regarding the confidentiality of certain information given to the Director (with which the Director shall be permitted to comply), the Director and the Treasurer will furnish to the Underwriter and Standard & Poor’s Ratings Services, a division of the McGraw Hill Companies, or any of their successors and assigns, such reports as are reasonably requested regarding the Chapter 166 economic development programs and the Ohio Enterprise Bond Fund program.
(l)    The Issuer has not granted a lien on or made a pledge of the Pledged Receipts except as provided in the Trust Agreement. In addition, the Issuer has not granted a lien on or made a pledge of the Program Transfer Account.
(m)    The Bonds, when issued and sold to the Underwriter, will not be subject to any State issuance, transfer or other documentary stamp taxes of the Issuer.

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(n)    Each of the representations and warranties of the Issuer, the Treasurer and the Director contained in the Trust Agreement and the Loan Agreement is true and correct.
4.    Representations and Warranties of the Borrower.
The Borrower hereby represents and warrants that:
(a)    The Borrower is a port authority and political subdivision organized under the laws of the State, and has all requisite power to conduct its business, as presently conducted and to own its assets and properties. 
(b)    The Borrower has full power and authority to (i) execute, deliver and perform the Loan Documents to which the Borrower is a party and this Bond Purchase Agreement, and (ii) take any and all action as may be required on its part to carry out, give effect to and consummate the transaction contemplated by the Loan Documents and this Bond Purchase Agreement.  This Bond Purchase Agreement constitutes, and the Loan Documents to which the Borrower is a party when executed and delivered for value will constitute, legal, valid and binding obligations of the Borrower. 
Such execution, delivery and performance do not and will not violate any provision of current law applicable to the Borrower or the Governing Instruments of the Borrower and do not and will not conflict with or result in a default under any agreement or instrument to which the Borrower is a party or by which it or any property or assets of the Borrower are bound, except where the violation of current law or the conflict with or default under such agreement or instrument would not materially impair the ability of the Borrower to perform its obligations under the Loan Documents or materially adversely affect the financial condition of the Borrower or the abilities of the parties to consummate the transactions contemplated by the Loan Documents.  The Loan Documents to which the Borrower is a party have, by proper action, been duly authorized, executed and delivered and all necessary actions have been taken in order for the Loan Documents to constitute legal, valid and binding obligations of the Borrower.
(c)    The Borrower presently intends that the Project will be used and operated in a manner consistent with the statements made in the Official Statement in Wilmington, Ohio until the end of the Loan Term, and the Borrower knows of no reason why the Project will not be so operated.
(d)    There are no actions, suits or proceedings pending or, to the Borrower’s knowledge, threatened against or affecting the Borrower, the Borrower’s existence or the Project, which, if adversely determined, would individually or in the aggregate materially impair the ability of the Borrower to perform any of its obligations under the Loan Documents or this Bond Purchase Agreement or materially adversely affect the financial condition or operations of the Borrower or which would adversely affect the tax-exempt status of the interest on the Bonds.
(e)    The Borrower is not in violation of any provision of or in default under its Governing Instruments.  The Borrower is not in default under any of the Loan Documents or in the payment of any indebtedness for borrowed money or under any agreement or instrument 

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evidencing any such indebtedness, and no event has occurred which by notice, the passage or both would constitute any such event of default, except for such defaults that do not materially impair the ability of the Borrower to perform its obligations under the Loan Documents or materially adversely affect the financial condition or operations of the Borrower or the abilities of the parties to consummate the transactions contemplated by this Bond Purchase Agreement.
(f)    Based solely on the representations and warranties made by the Lessee: (i) the zoning regulations to which the Project Site is subject permit the Provision of the Project thereon in accordance with the Plans and Specifications, except to the extent that such regulations do not materially impair the ability of the Borrower to perform its obligations under the Loan Documents or do not materially adversely affect the financial condition or operations of the Borrower or the ability of the parties to consummate the transactions contemplated by this Bond Purchase Agreement; and (ii) all utilities, including water, storm and sanitary sewer, gas, electric and telephone, and rights of access to public ways are available or will be provided to the Project Site in locations and sufficient capacities to meet the requirements of operating the Project and of any applicable Governmental Authority.
(g)    The Borrower has made no contract or arrangement of any kind, other than the Loan Documents, which has given rise to, or the performance of which by the other party thereto would give rise to, a lien or claim of lien on the Project or other collateral covered by the Loan Documents, except Permitted Encumbrances.
(h)    Each representation or warranty made by the Borrower in the Loan Documents or this Bond Purchase Agreement is true and correct, and no statement contained in any certificate, schedule, financial statement or other instrument furnished to the Director by or on behalf of the Borrower, including without limitation, the Application, contained as of the date thereof any untrue statement of a material fact or omitted to state a material fact necessary to make the statements contained herein or therein not misleading.
(i)    All proceeds of the State Assistance shall be used for the payment, or the reimbursement to the Borrower, of Allowable Costs relating to Provision of the Project.  No part of any such proceeds shall be knowingly paid to or retained by the Borrower or any partner, officer, shareholder, director or employee of the Borrower as a fee, kick-back or consideration of any type.  The Borrower has no identity of interest with any supplier, contractor, architect, subcontractor, laborer or materialman performing work or services or supplying materials in connection with the Provision of the Project.
(j)    Based solely on the representations and warranties made by the Lessee, no Hazardous Waste, Toxic Chemical or Petroleum will be discharged, dispersed, released, stored or treated at the Project Site, except for such use and storage of any Hazardous Substance, Hazardous Waste, Toxic Chemical or Petroleum which may be utilized, treated and stored on the Project Site in the ordinary course of business operations in material compliance with Environmental Laws.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, to the Borrower’s knowledge, no asbestos or asbestos-containing materials have been or will be installed, used or incorporated into any buildings, structures, additions, improvements, facilities, fixtures or installations at the Project 

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Site, or disposed of on or otherwise released at or from the Project Site.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, to the Borrower’s knowledge, no underground storage tanks are located at the Project Site.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, no investigation, administrative order, consent order and agreement, litigation or settlement under any Environmental Law with respect to any Hazardous Substance, Hazardous Waste, Toxic Chemical, Petroleum, asbestos or asbestos-containing material is in existence with respect to which Borrower has received written notice, or, to the Borrower’s knowledge, is proposed, threatened or anticipated with respect to the Project.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, the Project is in compliance with all applicable Environmental Laws, and the Borrower has not received any written notice from any entity, Governmental Authority, or individual claiming any violation of, or requiring compliance with, any Environmental Law.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, the Borrower has not received any written request for information, written notice of claim, written demand or other written notification that the Borrower may be responsible for a threatened or actual release of any Toxic Chemical, Hazardous Substance, Hazardous Waste, Petroleum, asbestos or asbestos-containing material or for any damage to the environment or to natural resources.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, to the Borrower’s knowledge, no “clean-up” of the Project has occurred pursuant to any applicable Environmental Laws which would give rise to (i) liability on the part of any person, entity or association to reimburse any Governmental Authority for the costs of any such “clean-up” or (ii) a lien or encumbrance on the Project.
(k)    The Borrower has good and marketable title to the Project, subject in all cases to no valid lien, charge, condition, restriction, encumbrance, easement or agreement affecting the Project, except as created by or otherwise permitted by the Loan Documents.
(l)    The Borrower hereby ratifies and authorizes the distribution and use of the Preliminary Official Statement and authorizes the distribution and use of the Official Statement in connection with the public offering and sale of the Bonds.
(m)    The information set forth under the captions “SUMMARY STATEMENT - The Borrower” and “THE BORROWER” contained in the Preliminary Official Statement was, as of its date, and in the Official Statement is, and as of the Closing Date will be, true and correct in all material respects.
(n)    The Borrower has obtained all approvals and authorizations required at the date hereof for its consummation of the transactions contemplated by the Loan Documents and this Bond Purchase Agreement, including all consents, approvals, authorizations and orders of governmental or regulatory authorities which are required at the date hereof for the Borrower’s execution and delivery of this Bond Purchase Agreement and the Loan Documents and such documents will be in full force and effect as of the Closing Date.

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5.    Representations and Warranties of the Lessee.  The Lessee hereby represents and warrants that:
(a)    The Lessee is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Nevada and is qualified to do business in the State.  The Lessee has all requisite corporate power to conduct its business as presently conducted, to own or hold under lease the Lessee’s assets and properties, and is duly qualified to do business in all other jurisdictions in which the Lessee is required to be qualified, except where failure to be so qualified does not have a material adverse effect on the Lessee, and will remain so qualified and in full force and effect during the Loan Term.
(b)    The Lessee has full corporate power and authority to (i) execute, deliver and perform the Loan Documents to which the Lessee is a party and this Bond Purchase Agreement; (ii) provide for the Project and conduct its business as described in the Official Statement; and (iii) enter into and carry out the transactions contemplated hereby and thereby.
Such execution, delivery and performance do not and will not, violate any provision of law applicable to the Lessee or the Governing Instruments of the Lessee and do not, and will not, conflict with or result in a default under any agreement or instrument to which the Lessee is a party or by which it or any property or assets of the Lessee is or may be bound, except where the violation of current law or the conflict with or default under such agreement or instrument would not materially impair the ability of the Lessee to perform its obligations under the Loan Documents to which the Lessee is a party or materially adversely affect the financial condition of the Lessee or the abilities of the parties to consummate the transactions contemplated by the Loan  Documents.  This Bond Purchase Agreement has been duly authorized, executed and delivered by the Lessee and all necessary actions have been taken in order for this Bond Purchase Agreement to constitute a legal, valid and binding obligation of the Lessee. The Loan  Documents to which the Lessee is a party have, by proper action, been duly authorized, and when executed and delivered will constitute legal, valid and binding obligations of the Lessee.
(c)    The provision of financial assistance pursuant to the Loan Agreement induced the Borrower, at the request of the Lessee, to provide the Project, thereby, to the knowledge of the Lessee, creating new jobs or preserving existing jobs and employment opportunities and improving the economic welfare of the people of the State.
(d)    The Project will be operated and maintained  in Wilmington, Ohio in such a manner as to conform with all applicable environmental laws and zoning, planning, building and other governmental regulations imposed by any Governmental Authority and as to be consistent with the purpose of the Act, except where such nonconformity or inconsistency would not materially impair the ability of the Lessee to perform its obligations under the Loan Documents or materially adversely affect the financial condition of the Lessee or the ability of the parties to consummate the transactions contemplated by this Bond Purchase Agreement.
(e)    The Lessee presently intends that the Project will be used and operated in a manner consistent with the statements made in the Official Statement in Wilmington, Ohio until the end of the Loan Term, and the Lessee knows of no reason why the Project will not be so operated.

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(f)    To the Lessee’s knowledge, there are no actions, suits or proceedings pending with respect to which Lessee has been served with process or threatened in writing against or affecting the Lessee, or the Project, which individually or in the aggregate are likely to materially impair the ability of the Lessee to perform any of its obligations under the Security Documents or this Bond Purchase Agreement or materially adversely affect the financial condition of the Lessee.
(g)    The zoning regulations to which the Project Site is subject permit the Provision of the Project thereon in accordance with the Plans and Specifications, except to the extent that such regulations do not materially impair the ability of the Lessee to perform its obligations under the Loan Documents or do not materially adversely affect the financial condition or operations of either of the Lessee or the Operating Company or the abilities of the parties to consummate the transactions contemplated by this Bond Purchase Agreement; and all utilities, including water, storm and sanitary sewer, gas, electric and telephone, and rights of access to public ways are available or will be provided to the Project Site in locations and sufficient capacities to meet the requirements of operating the Project and of any applicable Governmental Authority.
(h)    The Lessee is not in default under any of the Transaction Documents, as defined in Exhibit D hereto, to which the Lessee is a party or in the payment of any indebtedness for borrowed money or under any agreement or instrument evidencing any such indebtedness, and no event has occurred which by notice, the passage of time or both would constitute an event of default, except for such defaults that do not materially impair the ability of the Lessee to perform its obligations under the Loan Documents to which the Lessee is a party or materially adversely affect the financial condition or operations of the Lessee or the abilities of the parties to consummate the transactions contemplated by this Bond Purchase Agreement.
(i)    Each representation or warranty made by the Lessee in this Bond Purchase Agreement is true and correct, and no statement contained in any certificate, schedule, financial statement or other instrument furnished to the Director by or on behalf of the Lessee, contained as of the date thereof any untrue statement of a material fact or omitted to state a material fact necessary to make the statements contained herein or therein not misleading.
(j)    No Hazardous Waste, Toxic Chemical or Petroleum will be discharged, dispersed, released, stored or treated at the Project Site, except for such use and storage of any Hazardous Substance, Hazardous Waste, Toxic Chemical or Petroleum which may be utilized, treated and stored on the Project Site in the ordinary course of business operations in compliance with Environmental Laws.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, to the best of the Lessee’s knowledge, no asbestos or asbestos-containing materials have been or will be installed, used or incorporated into any buildings, structures, additions, improvements, facilities, fixtures or installations at the Project Site, or disposed of on or otherwise released at or from the Project Site.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, to the best of the Lessee’s knowledge, no underground storage tanks are located at the Project Site.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, no investigation, administrative order, consent order and agreement, litigation or settlement under any Environmental Law with respect to any Hazardous Substance, Hazardous 

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Waste, Toxic Chemical, Petroleum, asbestos or asbestos-containing material is in existence, or, to the best of the Lessee’s knowledge, is proposed, threatened or anticipated with respect to the Project.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, the Project is in compliance with all applicable Environmental Laws, and the Lessee has not received any notice from any entity, Governmental Authority, or individual claiming any violation of, or requiring compliance with any Environmental Law.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, the Lessee has not received any request for information, notice of claim, demand or other notification that the Lessee may be responsible for a threatened or actual release of any Toxic Chemical, Hazardous Substance, Hazardous Waste, Petroleum, asbestos or asbestos-containing material or for any damage to the environment or to natural resources.  Except as otherwise described in the environmental assessments provided to the Director of Development Services Agency, no “clean-up” of the Project has occurred pursuant to any applicable Environmental Laws which would give rise to (i) liability on the part of any person, entity or association to reimburse any Governmental Authority for the costs of any such “clean-up” or (ii) a lien or encumbrance on the Project.
(k)    The Lessee hereby ratifies and authorizes the distribution and use of the Preliminary Official Statement and authorizes the distribution and use of the Official Statement in connection with the public offering and sale of the Bonds.
(l)    The information set forth under the captions “SUMMARY STATEMENT - The Lessee,” “SUMMARY STATEMENT - The Project,” “THE PROJECT, “THE LESSEE” and “SOURCES AND USES OF FUNDS,” and contained in the Preliminary Official Statement (except to the extent that such information is completed, amended, or deleted in the Official Statement) was, as of its date, and in the Official Statement is, and as of the Closing Date will be, true and correct in all material respects.
(m)    The Project is zoned by Clinton County, Ohio under zoning regulations which permit the operation of the Lessee’s business thereon; and all utilities, including water, storm and sanitary sewer, gas, electric and telephone, and rights of access to public ways are available or will be provided to the Project in locations and sufficient capacities to meet the requirements of operating the Project and of any applicable Governmental Authority.
6.    Covenants of the Issuer, Treasurer and the Director.
The Issuer, by and through the Treasurer and the Director, as applicable, hereby covenant as follows:
(a)    The Issuer, the Treasurer and the Director will observe all covenants of the Issuer in the Trust Agreement.
(b)    The Director and the Treasurer covenant that between the date hereof and the Closing Date they will not take or fail to take any action, the taking or failure to take of which will cause the representations and warranties made herein to be untrue as of the Closing Date.

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(c)    The Issuer, the Treasurer and the Director will cooperate with the Underwriter in qualifying the Bonds for offer and sale under the securities laws of such jurisdictions of the United States of America as the Underwriter may request; provided, however, that the Issuer shall not be obligated to consent to a special or general service of process or qualify as a foreign corporation in connection with any such qualification in any such jurisdiction; and provided, further, that the Issuer’s out-of-pocket costs in respect thereof are paid out of the proceeds of the Bonds or are otherwise provided for.
(d)    The Treasurer and the Director will not take or omit to take any action which action or omission will adversely affect the exclusion from gross income for federal income tax purposes of the interest on the Bonds under the Code.
(e)    If, prior to the Closing Date, any event which materially affects the Issuer, Treasurer or the Director shall occur as a result of which it is necessary to amend or supplement the Official Statement in order to make the statements therein, in the light of the circumstances when the Official Statement is delivered to a purchaser, not misleading, the Issuer, Treasurer or the Director will notify the Underwriter of such event and will, at the request of the Underwriter, cooperate in the preparation of either amendments to the Official Statement or supplemental information so that the statements in the Official Statement as so amended or supplemented will not, in the light of the circumstances when the Official Statement is delivered to a purchaser, be misleading. Such amendment or supplement shall be prepared at the cost of the Borrower from funds provided to it by the Lessee, the Operating Company, or ATSG.

7.    Covenants of the Borrower.
The Borrower covenants as follows:
(a)    The Borrower will observe in all material respects all terms, provisions and covenants required to be observed by it in the Loan Documents and this Bond Purchase Agreement.
(b)    The Borrower will take such action as may be reasonably required to facilitate the timely consummation of the transactions contemplated by this Bond Purchase Agreement and the Loan Documents, subject to the limitations otherwise provided herein.
(c)    The Borrower will notify the Underwriter of any material adverse change in the business, properties or financial condition of the Borrower occurring before Closing and at such other time or times prior to the Closing Date, when, in the opinion of the Issuer, the Borrower or the Underwriter, copies of the Official Statement will be required to be delivered to purchasers of the Bonds and when such change, in the judgment of the Issuer, the Borrower or the Underwriter, would require a change in the Official Statement in order to make the statements therein true in all material respects and not materially misleading.  Such amendment or supplement shall be prepared at the cost of the Borrower but solely from funds provided to it by the Lessee, the Operating Company or ATSG..

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(d)    The Borrower will cooperate with the Underwriter in qualifying the Bonds for offer and sale under the securities laws of such jurisdictions of the United States of America as the Underwriter may reasonably request; provided, however, that the Borrower shall not be obligated to consent to special or general service of process, to qualify to pay any tax or to qualify to do business in any such jurisdiction.
(e)    The Borrower will not take or omit to take any action which action or omission will adversely affect the exclusion from gross income for federal income tax purposes of the interest on the Bonds under the Code; provided that the Borrower shall not be responsible for the payment of any closing or settlement agreement with the Internal Revenue Service entered into without prior notice to the Borrower.
		
	8.
	Covenants of the Lessee.  The Lessee covenants as follows:

(a)    The Lessee will observe all terms, provisions and covenants required to be observed by it in the Loan Documents and the Bond Purchase Agreement.
(b)    The Lessee will take such action as may be reasonably required on its part to facilitate the timely consummation of the transactions contemplated by this Bond Purchase Agreement and the Loan Documents, subject to the limitations otherwise provided herein and in the Security Documents.
(c)    If, prior to the Closing Date, any event which materially affects the Lessee shall occur as a result of which it is necessary to amend or supplement the Official Statement in order to make the statements therein, in the light of the circumstances when the Official Statement is delivered to a purchaser, not misleading, the Lessee will notify the Underwriter of such event and will, at the request of the Underwriter, cooperate in the preparation of either amendments to the Official Statement or supplemental information so that the statements in the Official Statement as so amended or supplemented will not, in the light of the circumstances when the Official Statement is delivered to a purchaser, be misleading.
9.    Indemnification.
(a)    Scope of Indemnification.  To the extent permitted by law, each of the Lessee and the Underwriter (each, an “Indemnifying Party”) covenant and agree to indemnify each other party hereto and its respective directors, officers, trustees, partners, members and employees and each person, if any, who controls any of such persons within the meaning of the Securities Act (reference being made collectively herein to those parties as the “Indemnified Parties”) for and to hold each Indemnified Party harmless against all liabilities, claims, costs, losses and expenses (including without limitation, to the extent permitted by law, reasonable attorney fees and expenses), imposed upon or asserted against the Indemnified Party:
(i)    under any statute or regulation, at law, in equity or otherwise, insofar as those liabilities, claims, costs, losses and expenses arise out of or are based upon any untrue statement or alleged untrue statement of a material fact, with reference to the information referred to in Section 9(c) hereof contained in the Preliminary Official Statement, the Official 

14

Statement or any amendment thereof or supplement thereto or, except as to information contained in the Appendices B or C to the Preliminary Official Statement and the Official Statement, arise out of or are based upon any omission or alleged omission to state therein, with reference to such information in Section 9(c) hereof, a material fact which is necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading;
(ii)    as a result of any action, claim or proceeding brought in connection with any of the foregoing; and
(iii)    to the extent of the aggregate amount paid in settlement of any action, claim or proceeding commenced or threatened based upon any untrue statement, alleged untrue statement, omission or alleged omission described in Section 9(a)(i) above, if the settlement is effected with the written consent of the Indemnifying Party (which consent shall not be withheld unreasonably);
and will reimburse any legal or other expenses incurred reasonably by any Indemnified Party in connection with investigating or defending any liability, claim, cost, loss, expense, action or proceeding described in Section 9(a)(i) above.
At the request and the expense of the Indemnifying Party, each Indemnified Party shall cooperate in making any investigation and defense of any action, claim or proceeding and shall assert appropriately the rights, privileges and defenses which are available to the Indemnified Party in connection therewith.
(b)    Procedure. In case any action, claim or proceeding is brought or asserted against an Indemnified Party with respect to which indemnification may be sought under this Section, the Indemnified Party shall give written notice thereof promptly to the Indemnifying Party. Failure of the Indemnified Party to give, or delay in giving, that notice shall relieve the Indemnifying Party from any covenant, agreement or obligation under this Section, unless that failure or delay does not prejudice the defense by the Indemnifying Party of the action, claim or proceeding, and only to the extent of such lack of prejudice.  The failure to give that notice shall not relieve the Indemnifying Party from any obligation which it may have to the Indemnified Party otherwise than under this Section.
In case any action, claim or proceeding as to which the Indemnifying Party is to provide indemnification hereunder, shall be brought against the Indemnified Party and the Indemnified Party notifies the Indemnifying Party of the commencement thereof, the Indemnifying Party may, or if so requested by the Indemnified Party shall, participate therein or assume the defense thereof, with counsel reasonably satisfactory to the Indemnified Party; provided that, except as provided below, the Indemnifying Party shall not be liable for the expenses of more than one separate counsel representing the Indemnified Parties in the action, claim or proceeding.
After notice from the Indemnifying Party to the Indemnified Party of an election by the Indemnifying Party so to assume the defense thereof, the Indemnifying Party will not be liable to the Indemnified Party under this Section for any legal or other expenses incurred subsequently by 

15

the Indemnified Party in connection with that defense, other than for reasonable costs of investigation; provided, however, that until the Indemnifying Party assumes the defense of any action, claim or proceeding, the Indemnifying Party shall have the right to participate in the defense of the action, claim or proceeding at its own expense.
If the Indemnifying Party shall not have employed counsel to have charge of the defense of the action, claim or proceeding, or if an Indemnified Party shall have concluded reasonably that there may be a defense available to it or to any other Indemnified Party which is different from or in addition to those available to the Indemnifying Party or to any other Indemnified Party (hereinafter referred to as a “separate defense”), (i) the Indemnifying Party shall not have the right to direct the defense of the action, claim or proceeding on behalf of the Indemnified Party, and (ii) legal and other expenses incurred by the Indemnified Party (including without limitation, to the extent permitted by law, reasonable attorney fees and expenses) shall be borne by the Indemnifying Party.  For the purpose of this paragraph, an Indemnified Party shall be deemed to have concluded reasonably that a separate defense is available to it or any other Indemnified Party if (a) such Indemnified Party shall have requested an unqualified written opinion from independent counsel acceptable to the Indemnifying Party to the effect that a separate defense exists, and such independent counsel shall have delivered such opinion to the Indemnified Party within 10 days after such request or (b) the Indemnifying Party agrees that a separate defense is so available.  For purposes of this paragraph, independent counsel shall mean any attorney, or firm or association of attorneys, duly admitted to practice law before the Supreme Court of Ohio and not a full-time employee of any Indemnified Party.
(c)    The information as to which each Indemnifying Party hereto indemnifies the Indemnified Parties is as follows:
(i)    The Lessee:  the information set forth under the captions “SUMMARY STATEMENT - The Borrower,” “SUMMARY STATEMENT - The Lessee,” “SUMMARY STATEMENT - The Project,” “THE BORROWER,” “THE LESSEE,” “THE PROJECT” and “SOURCES AND USES OF FUNDS”;
(ii)    The Underwriter: information regarding the principal amounts, the maturities, the initial offering price of the Bonds or the initial interest rate and the information under the caption “UNDERWRITING.”
10.    Conditions of the Underwriter’s Obligations.
The obligations of the Underwriter hereunder shall be subject to the performance by the Issuer, the Borrower, and the Lessee of their respective obligations and agreements to be performed hereunder at or prior to the Closing Date; to the accuracy as of the date hereof of the representations and warranties of the Issuer, the Borrower, and the Lessee contained herein; and to the accuracy of such representations and warranties as if made on and as of the Closing Date.
The obligations of the Underwriter hereunder are subject to the following further conditions:
(a)    On or prior to the Closing Date, the Underwriter shall have received:

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(i)    An executed copy or photocopy of the executed Original Trust Agreement, an executed copy of each of the Supplement, the Loan Agreement and this Bond Purchase Agreement, and a certified copy of the Order; all of the foregoing to conform in all material respects to the descriptions thereof contained in the Official Statement and to be in the forms of the drafts thereof delivered to the Underwriter on or prior to the date hereof, with only such changes therein as may be reasonably approved by the Underwriter and its Counsel;
(ii)    Opinions dated the Closing Date, of:
(A)    Brouse McDowell, a Legal Professional Association, as Bond Counsel, substantially in the forms set forth as Exhibits A and B hereto;
(B)    Vorys, Sater, Seymour and Pease LLP, as counsel to the Borrower, substantially in the form set forth as Exhibit C hereto;
(C)    Vorys, Sater, Seymour and Pease LLP, as counsel to the Lessee, Operating Company, and Guarantor, substantially in the form set forth as Exhibit D hereto;
(D)    Brennan, Manna & Diamond, LLC,  as counsel to the Underwriter, substantially in the form set forth as Exhibit E hereto; and
(E)    The Assistant Attorney General of Ohio assigned to the Director’s office substantially in the form set forth in Exhibit F hereto;
(iii)    A certificate, dated the Closing Date, signed by the Treasurer in the form set forth in Exhibit G hereto;
(iv)    A certificate, dated the Closing Date, executed by the Director or his duly authorized representative in the form set forth in Exhibit H hereto;
(v)    A certificate, dated the Closing Date, executed by a duly authorized representative of the Borrower in the forms set forth in Exhibit I hereto;
(vi)    A certificate, dated the Closing Date, executed by a duly authorized representative of the Lessee in the form set forth in Exhibit J hereto;
(vii)    Evidence that Standard & Poor’s Ratings Services, a division of the McGraw Hill Companies has issued a rating for the Bonds which is not lower than “AA+”; and
 
(viii)    Such additional certificates (including such certificates as may be required by regulations of the Internal Revenue Service in order to establish the tax-exempt character of the Bonds, which certificates shall be satisfactory in form and substance to counsel to the Underwriter and Bond Counsel, and also including appropriate “no litigation” certificates), opinions, instruments or other documents as the Underwriter may reasonably request to evidence the truth, accuracy and completeness, as of the Closing Date, of the representations and warranties of the Issuer and the Borrower contained herein and the due 

17

performance and satisfaction by the Issuer and the Borrower at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by each of them, as appropriate, in connection with this Bond Purchase Agreement and the Loan Documents.
(b)    Between the date hereof and the Closing Date, legislation shall not have been enacted by the Congress or be actively considered for enactment by Congress, or recommended to the Congress for passage by the President of the United States of America, or introduced or favorably reported for passage in either house of Congress, and neither a decision, order or decree of a court of competent jurisdiction, nor an order, ruling, or regulation of or on behalf of the Securities and Exchange Commission shall have been rendered or made, with the purpose or effect that the issuance, offering or sale of the Bonds or any related security or obligations of the general character of the Bonds or any related security as contemplated hereby, or the execution and delivery of the Trust Agreement or indentures similar thereto, is or would be in violation of any provision of, or is or would be subject to registration or qualification requirements under the Securities Act, the Trust Indenture Act of 1939, as amended, or under any other federal securities law.
(c)    No event shall have occurred or fact exist which makes untrue, incorrect or inaccurate, in any material respect as of the time the same purports to speak, any material statement or information contained in the Official Statement or which is not reflected in the Official Statement but should be reflected therein as of the time and for the purpose for which the Official Statement is to be used in order to make the statements and information contained therein not misleading in any material respect as of such time.
(d)    None of the following shall have occurred:
(i)    additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange or such trading shall have been suspended;
(ii)    the New York Stock Exchange or other national securities exchange, or the Financial Industry Regulatory Authority Inc. or other national securities association, or the MSRB or other similar national self regulatory rule-making board, or any governmental authority, shall impose, as to the Bonds or similar obligations, any material restrictions not now in force, or increase materially those now in force, with respect to the extension of credit by, or change the net capital requirements of, the Underwriter;
(iii)    a general banking moratorium shall have been declared by federal, New York or the State authorities; or
(iv)    a war involving the United States of America, whether or not declared, other than hostilities in progress on the date of this Bond Purchase Agreement, or any other national or international calamity or crisis, or a financial crisis, shall have occurred, or any change in State law shall have been enacted or proposed, the effect of which, in the reasonable judgment of the Underwriter, would make it impracticable to market the Bonds or would 

18

materially and adversely affect the ability of the Underwriter to enforce contracts for the sale of the Bonds.
(e)    All matters relating to this Bond Purchase Agreement, the Loan Documents, the Official Statement, the Bonds, the Order, the Trust Agreement, and the consummation of the transactions contemplated by this Bond Purchase Agreement and the Official Statement shall be reasonably satisfactory to the Underwriter.
If any of the conditions specified in the preceding provisions of this Section shall not have been fulfilled when and as required by this Bond Purchase Agreement, the Underwriter’s obligations hereunder may be terminated by the Underwriter at, or at any time prior to, the Closing Date.  Any such termination shall be without liability on the Underwriter’s part.
11.    No Pecuniary Liability of Issuer or the Director.
No provision, covenant, or agreement contained in this Bond Purchase Agreement, and no obligation herein imposed upon the Issuer, or the breach thereof, shall constitute an indebtedness of the Issuer within the meaning of any State constitutional provision or statutory limitation or shall constitute or give rise to a pecuniary liability of the Issuer or a charge against its general credit or taxing powers.  In making the agreements, provisions and covenants set forth in this Bond Purchase Agreement, the Issuer has not obligated itself, except to the extent that the Issuer is authorized to act pursuant to State law.  The Issuer and its officials shall have no pecuniary liability arising out of the obligations of the Issuer hereunder or in connection with any covenant, representation or warranty made by the Issuer herein, and neither the Issuer nor its officials shall be obligated to pay any amounts in connection with the transactions contemplated hereby other than from Ohio Enterprise Bond Fund Revenues, or moneys received from the Borrower or pursuant to other security. 
12.    Survival of Representations; Warranties; Covenants; Agreements and Indemnities.
All representations, warranties, covenants, agreements and indemnities contained in this Bond Purchase Agreement or contained in the certificates of officials or officers of the Issuer, the Lessee, or the Borrower submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation by or on behalf of the Underwriter or any person controlling the Underwriter, and shall survive delivery of the Bonds to the Underwriter until the expiration of the Loan Term and the principal and interest on the Bonds has been paid in full.
13.    Payment of Expenses.
All expenses incident to the issuance of the Bonds (including the charges, fees and disbursements described in Sections 1(m) above) are to be paid out of the proceeds of the Bonds at Closing to the extent permitted by law, and any amounts not permitted by law to be paid from the proceeds, or if the Bonds are not delivered to the Underwriter as herein provided, shall be paid by the Borrower (unless the Underwriter shall have failed to purchase the Bonds other than for reasons permitted under this Bond Purchase Agreement, in which case the Borrower shall not pay the fees and expenses of the Underwriter) from funds provided to it by the Lessee, the Operating 

19

Company, or ATSG.  In no event shall more than 2% of proceeds of the Bonds be used to pay such expenses.  Neither the Issuer nor the Underwriter shall be obligated to pay any expenses incurred in connection with the transactions contemplated by this Bond Purchase Agreement.

14.    Parties in Interest.
This Bond Purchase Agreement is made solely for the benefit of the Underwriter, persons controlling the Underwriter, the Issuer, its officials and officers, the Borrower, the Lessee, the Operating Company, ATSG, and their respective successors, and no other person, partnership, association or corporation shall acquire or have any right under or by virtue of this Bond Purchase Agreement.  The term “successors” shall not include any purchaser of the Bonds merely by reason of such purchase.
15.    Notices.
Any notice or other communication to be given to any party to this Bond Purchase Agreement may be given by delivering the same in writing at the respective addresses set forth below:

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	As to the Issuer:
	State Treasurer’s Office
30 East Broad Street, 9th Floor
Columbus, Ohio  43215
Attn:   Seth Metcalf

	As to the Director:
	Ohio Development Services Agency
Economic Development Finance Division
77 South High Street, 28th Floor
Columbus, Ohio  43215
Attn:   Tracy Allen

	As to the Borrower:
	Clinton County Port Authority
Wilmington Air Park
1113 Airport Road
Wilmington, Ohio 45166
Attn: Kevin Carver, Executive Director

with a copy to:

Vorys, Sater, Seymour and Pease LLP
52 East Gay Street
Columbus, Ohio 43215
Attn: D Scott Powell, Esq.

	As to the Lessee, Operating Company and ATSG:
	Air Transport International Limited Liability Company
145 Hunter Drive
Wilmington, Ohio 45177
Attn: Russ Smethwick, Director, Strategic Planning
Fax: (937) 382-2452

	As to the Underwriter:
	Stifel, Nicolaus & Company, Incorporated
200 Public Square
Cleveland, Ohio 44114
Attn: Mark Fisher
 

	As to the Trustee:
	The Huntington National Bank
Corporate Trust Services
7 Easton Oval, EA4E63
Attn:   Michelle Harmon

16.    Severability.
If any provision of this Bond Purchase Agreement shall be held or deemed to be or shall, in fact, be inoperative, invalid or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or in all jurisdictions because it conflicts with any provisions of any Constitution, statute, rule of public policy, or any other reason, such circumstances shall not have the effect of rendering the provision in question inoperable or unenforceable in any other case or circumstance, or of rendering any other provision or provisions of this Bond Purchase Agreement invalid, inoperative or unenforceable to any extent whatever, unless such severing results in the loss of the practical realization of the benefits anticipated by the parties.

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17.     Underwriter Confirmation of Certifications in Statements of Qualifications.  The Underwriter hereby certifies that:
(a)    In accordance with Executive Order 2007-01S, it (1) has reviewed and understands Executive Order 2007-01S, (2) has reviewed and understands the State ethics and conflict of interest laws, (3) will take no action inconsistent with those laws and that Executive Order 2007-01S, and (4) understands that failure to comply with Executive Order 2007-01S is, in itself, grounds for termination of this Agreement and may result in the loss of other contracts or grants with the Treasurer or with or from the Issuer.

(b)    Its position as underwriter to the Treasurer under the terms of this Agreement will not create any conflict of interest for it or any of its assigned personnel and it will promptly disclose to the Treasurer any such conflict of interest if, as and when it arises and is known to it.

(c)    It is an equal opportunity employer and does not discriminate against applicants or employees on the basis of race, color, religion, sex, age, disability, national origin, or military veteran status.

(d)    All of its personnel assigned to work on the issuance of the Bonds who are not United States citizens have executed a valid I-9 form and have valid employment authorization documents.

(e)    It is not currently in violation of or under any investigation or review for a violation of any state or federal law or regulation that might have a material adverse impact on its ability to perform its duties and obligations under this Agreement.

(f)    It is in compliance with the applicable provisions of the following laws:

(i)    The Federal (41 U.S.C. 701(a)) and Ohio (R.C. 153.03) Drug Free Workplace Acts.  It has and will make good faith efforts to ensure that all of its employees will not have been or be under the influence of illegal drugs or alcohol or abuse prescription drugs in any way while working on property of the Issuer.

(ii)    The Ohio Patriot Anti-Terrorism Act (Sections 2909.32-.34 of the Revised Code).

(iii)    State of Ohio ethics (Chapter 102 and Sections 2921.42 and 2921.43 of the Revised Code), campaign financing (Chapter 3517 of the Revised Code, including but not limited to divisions (I)(1) and (3) and (J)(1) and (3) of Section 3517.13), and lobbying (Sections 101.70 and 121.60 et seq. of the Revised Code).

(iv)    Section 9.24 of the Revised Code.  It is not subject to an “unresolved” finding for recovery under that section.

(g)    It does not, and will not through the end of the “underwriting period” as defined by the Rule, have a financial interest in any firm providing financial advisory services to the Treasurer.

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18.    Applicable Law.
This Bond Purchase Agreement shall be governed by and construed in accordance with the laws of the State.
19.    Counterparts.
This Bond Purchase Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties have signed this Bond Purchase Agreement by their authorized officers as of the date first written above.
STATE OF OHIO

By:    /s/ Josh Mandel     
Josh Mandel
State Treasurer of Ohio

DEVELOPMENT SERVICES AGENCY OF THE STATE OF OHIO

By:        
Name:     
Title: Director of Development Services     Agency

CLINTON COUNTY PORT AUTHORITY

By:    /s/ David C. Hockaday     
David C. Hockaday
Chairman

AIR TRANSPORT INTERNATIONAL LIMITED LIABILITY COMPANY

By:    /s/ W. Joseph Payne     
W. Joseph Payne
Vice President, Secretary

STIFEL, NICOLAUS & COMPANY, INCORPORATED

By:    /s/ Mark Fisher     
Mark Fisher
Sr. Vice President

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EXHIBIT A
[FORM OF OPINION OF BOND COUNSEL]

December 27, 2012

Director of Development Services Agency
State of Ohio

Treasurer of State 
State of Ohio 

Stifel, Nicolaus & Company, Incorporated

		
	Re:
	$9,055,000 State of Ohio State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax Exempt Bonds) 

Ladies and Gentlemen:

We have acted as bond counsel in connection with the issuance by the State of Ohio (the “Issuer” or the “State”) of $9,055,000 State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax Exempt Bonds) (the “Bonds”).  In such capacity, we have examined such law and such certified proceedings, certifications and other documents as we have deemed necessary to render this opinion. 
The Bonds are being issued for the purpose of providing funds to be loaned to Clinton County Port Authority (the “Borrower”) to be used by the Borrower to finance an Eligible Project, as defined in the Indenture hereinafter referred to, and to pay the costs of issuance of the Bonds, all as provided in (i) a certain Loan Agreement dated as of December 1, 2012 (the “Loan Agreement”) between the Director of Development Services Agency of the State and the Borrower, and (ii) the Trust Agreement, dated as of April 1, 1988 (the “Original Indenture”), as supplemented by the One Hundred Twenty-Eighth Supplemental Trust Agreement, dated as of December 1, 2012 (the “Supplement,” and together with the Original Indenture, the “Indenture”), between the Issuer and The Huntington National Bank, as successor trustee (the “Trustee”).  The Project to be financed in part by the proceeds of the Bonds is to be leased by the Borrower to Air Transport International Limited Liability Company (the “Lessee”) and subleased by the Lessee to Airborne Maintenance and Engineering Services, Inc. (the “Operating Company”).
Regarding questions of fact material to our opinion, we have relied on the transcript of proceedings for the Bonds (the “Transcript”) and other certifications of public officials and others as we have deemed necessary without undertaking to verify the same by independent investigation. 

A-1

Based on this examination, we are of the opinion that, as of the date hereof, under existing federal and Ohio statutes, as now judicially construed, together with existing regulations, rulings and court decisions:
1.The Bonds have been duly authorized, executed and delivered by the Issuer.  The Bonds, the Loan Agreement and the Supplement are legal, valid, binding obligations of the Issuer and enforceable in accordance with their respective terms.
2.The Bonds constitute special obligations of the Issuer, and the principal of and interest and any premium on the Bonds (collectively, “debt service”) are payable solely from the Pledged Receipts (as defined in the Indenture) pledged and assigned by the Indenture to secure that payment.  The Bonds are not general obligations, debt or bonded indebtedness of the Issuer, and the holders or owners of the Bonds do not have the right to have money raised by taxation obligated or pledged, and moneys raised by taxation shall not be obligated or pledged, by the Issuer or any political subdivision thereof for the payment of debt service charges.
3.The interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103(a) of the Internal Revenue Code of 1986, as amended (the “Code”), except for interest on any Bond for any period during which it is held by a “substantial user” of the facilities financed with proceeds of the Bonds or a “related person” as those terms are used in Section 147(a) of the Code.  Interest on the Bonds is treated as an item of tax preference under Section 57 of the Code for purposes of the alternative minimum tax imposed on individuals and corporations, and is included in adjusted current earnings of a corporation under Section 56(g) of the Code.
4.Interest on the Bonds, the transfer thereof, and any profit made on their sale, exchange or other disposition are exempt from the personal income tax, the Ohio commercial activity tax, the net income base of the Ohio corporate franchise tax, and municipal, school district and joint economic development district income taxes in Ohio.
We express no opinion and make no representation as to any other tax consequence regarding the Bonds, except as set forth above.
In giving the foregoing opinion with respect to the treatment of the interest on the Bonds and the status of the Bonds under the federal tax laws, we have assumed and relied upon compliance with the certain covenants of the Issuer, the Borrower, the Lessee, the Operating Company and the Trustee, and the accuracy, which we have not independently verified, of certain representations and certifications, contained in the Transcript.  The accuracy of those representations and certifications, and compliance with those covenants, may be necessary for the interest to be and remain excluded from gross income for federal income tax purposes and for other tax effects stated above. Failure to comply with certain requirements subsequent to issuance of the Bonds could cause the interest to be included in gross income for federal income tax purposes retroactively to the date of issuance of the Bonds.  The Borrower, the Lessee, the Operating Company and the Issuer have covenanted to take all actions that may be required for the interest on the Bonds to be and remain excluded from gross income for federal income tax purposes, and not to take any actions that would adversely affect such exclusion under provisions of the Code.

A-2

Please be advised that the rights of the holders of the Bonds and the enforceability thereof are limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or hereafter enacted, general principles of equity (whether considered at law or in equity) governing specific performance, injunctive relief and other equitable remedies, and the exercise of judicial discretion in appropriate cases. 
This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention, or any changes in law that may hereafter occur.  We bring to your attention the fact that our legal opinions are an expression of our professional judgment and are not a guarantee of a result. 
We do not undertake to advise you of matters which may come to our attention subsequent to the date hereof which may affect our legal opinions expressed herein. 
Respectfully submitted,
 

A-3

EXHIBIT B
[SUPPLEMENTAL OPINION OF BOND COUNSEL]

December 27, 2012

Director of Development Services Agency
State of Ohio

Treasurer of State
State of Ohio

Stifel, Nicolaus & Company, Incorporated

The Huntington National Bank, as Trustee

Air Transport International Limited Liability Company

Airborne Maintenance and Engineering Services, Inc.

Air Transport Services Group, Inc.

		
	Re:
	$9,055,000 State of Ohio State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) 

Ladies and Gentlemen:
This supplemental opinion is being rendered pursuant to Section 10(a)(ii)(A) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer” or the “State”), acting by and through the Treasurer of the State (the “Treasurer”) and the Director of Development Services Agency of the State, acting by and through his duly authorized representative (the “Director”), Clinton County Port Authority (the “Borrower”), Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), relating to the issuance and sale of $9,055,000 aggregate principal amount of the Issuer’s State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) (the “Bonds”).  All terms in this opinion have the same meanings as are assigned to them in the Bond Purchase Agreement.

B-1

We have acted as Bond Counsel in connection with the issuance and sale of the Bonds.  In rendering this opinion, we have examined the law, the Bond Purchase Agreement, the Preliminary Official Statement, the Official Statement (except for Appendices B and C thereto), the Loan Agreement and such other agreements, documents, certificates and instruments as we deemed necessary to render this opinion.  Based upon and subject to the foregoing and the assumptions and qualifications hereinafter set forth, we advise you as follows:
1.    The statements pertaining to the Bonds, the Order, the Trust Agreement and the Loan Agreement contained in the Preliminary Official Statement, as of its date, and in the Official Statement, as of its date, under the headings, “SUMMARY STATEMENT,” “INTRODUCTORY STATEMENT,” “CONSTITUTIONAL AND STATUTORY AUTHORIZATION,” “THE BONDS,” “SOURCE OF PAYMENT OF AND SECURITY FOR THE BONDS,” “ISSUANCE OF ADDITIONAL OHIO ENTERPRISE BOND FUND BONDS AND OTHER BONDS UNDER THE ACT,” “THE GENERAL BOND ORDER AND TRUST AGREEMENT,” “THE SERIES BOND ORDER AND SUPPLEMENTAL TRUST AGREEMENT,” “FORM PROJECT FINANCING AGREEMENT,” “ELIGIBILITY UNDER OHIO LAW FOR INVESTMENT AND AS SECURITY FOR THE DEPOSIT OF PUBLIC MONEYS” “CONTINUING DISCLOSURE COMMITMENT” and “TAX MATTERS,” and in Appendix A, entitled “Glossary” (except for any financial, technical or statistical information contained under these headings as to which we express no view) are fair and accurate summaries.
2.    In our capacity as Bond Counsel, without having assumed responsibility for, undertaken to determine independently, or in any manner passing upon the accuracy, completeness or fairness of, or to verify the information furnished with respect to, matters described in the Preliminary Official Statement and the Official Statement (other than as described in paragraph 1 above), but solely on the basis of our participation in certain conferences held for the purpose of preparing the Trust Agreement, the Preliminary Official Statement and the Official Statement and involving representatives of the Issuer, the Borrower, the Underwriter and counsel to the Underwriter, no facts have come to our attention that would lead us to believe that the Preliminary Official Statement on its date or the Official Statement on its date or the date hereof contain any untrue statement of material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading, except that we have not been called upon to and do not make any representation or render any opinion as to any statements contained under the headings “SUMMARY STATEMENT - The Borrower,” “SUMMARY STATEMENT - The Project,” “BOOK-ENTRY ONLY SYSTEM,” “THE PROJECT,” “THE BORROWER,” or “SOURCES AND USES OF FUNDS” or any portion of Appendices B or C, or as to any financial, technical or statistical data included in the Preliminary Official Statement or the Official Statement; provided, however, we note that the Preliminary Official Statement and the Official Statement expressly state that the statements made with respect to the documents referred to do not purport to summarize all the provisions of, and those are qualified in their entirety by, the complete documents which are summarized.
3.    We are of the opinion that, pursuant to the provisions of the statutes of the State of Ohio, particularly Chapter 166 of the Ohio Revised Code (the “Act”), the Treasurer, acting on behalf of the Issuer, has power and authority under the Act to (a) issue the Order, (b) enter into the Trust 

B-2

Agreement and accept the Bond Purchase Agreement, (c) approve and execute and authorize and ratify the use and distribution of the Preliminary Official Statement and the Official Statement, (d) issue, sell, execute and deliver the Bonds to the purchasers thereof as provided in the Order, the Trust Agreement, and the Bond Purchase Agreement and (e) carry out, give effect to and consummate the transactions contemplated by the Trust Agreement, the Bond Purchase Agreement and the Official Statement; and that the Director has power and authority under the Act to enter into the Bond Purchase Agreement and the Loan Agreement.
4.    We are of the opinion that the Bond Purchase Agreement has been duly authorized, executed and delivered by the Treasurer and by the Director, on behalf of the Issuer; the Trust Agreement has been authorized, executed and delivered by the Treasurer and the Loan Agreement has been duly authorized, executed and delivered by the Director. Assuming due and valid authorization, approval, execution and delivery by the other parties thereto, the Bond Purchase Agreement, the Trust Agreement and the Loan Agreement constitute the legal, valid and binding obligations of the Issuer, enforceable in accordance with their terms, except that the binding effect and enforceability thereof is subject to:  applicable bankruptcy, insolvency, fraudulent conveyance, reorganization and moratorium laws, and other similar laws affecting enforcement of creditors’ rights generally; judicial discretion in appropriate cases; general principles of equity and the effect of rules of law (whether in proceedings in equity or law) governing specific performance, injunctive relief and other equitable remedies; prohibitions against indemnifications or contributions under applicable laws or regulations or public policy arguments made pursuant thereto; prohibitions or public policy arguments against the payment of attorney fees and the waiver of remedies or other substantive or procedural rights; the effect of criminal usury statutes; and, in the case of the Loan Agreement, applicable securities laws. 
5.    No approval, permit, consent, authorization or order of any court or any governmental or public agency, authority or person not already obtained (other than any approvals that may be required under the Blue Sky or other securities laws and regulations of the United States or of any state or other jurisdiction) is required with respect to the Issuer, the Treasurer or the Director in connection with the issuance and sale of the Bonds, the issuance of the Order or the execution and delivery by the Issuer, Treasurer or Director of, or the performance by the Issuer, Treasurer or Director of, their respective obligations under the Bonds, the Bond Purchase Agreement, the Loan Agreement, the Order or the Trust Agreement.
Please be advised that nothing contained herein shall be construed to express any opinion or make any representation concerning (i) the present or future existence, title or ownership of the estates purported to be created by the Loan Agreement, (ii) the accuracy or sufficiency of the descriptions set forth in the Loan Agreement, and (iii) any other matter regarding the title of any person to real or personal property.
We bring to your attention the fact that our legal opinions are an expression of professional judgment and are not a guarantee of result.  The opinions set forth herein are limited to Ohio and U.S. federal law; we express no opinion as to the effect of any other applicable law.  We do not undertake to advise you of matters which may come to our attention subsequent to the date hereof which may affect our legal opinions expressed herein.

B-3

This letter is furnished solely for the benefit of the addressees hereof in connection with the issuance and sale of the Bonds, and may not be used or relied upon by any other person without, in each instance, our express written permission.
Respectfully submitted,

B-4

EXHIBIT C
[OPINION OF COUNSEL TO BORROWER]
December 27, 2012

Director of Development Services Agency
State of Ohio

Treasurer of State
State of Ohio

Stifel, Nicolaus & Company, Incorporated

Brouse McDowell, A Legal Professional Association

The Huntington National Bank, as Trustee
Air Transport International Limited Liability Company

Airborne Maintenance and Engineering Services, Inc.

Air Transport Services Group, Inc.

		
	Re:
	$9,055,000 State of Ohio Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds)

Ladies and Gentlemen:

We are counsel to Clinton County Port Authority (the “Borrower”) in connection with certain matters relating to the issuance of the above-captioned bonds (the “Bonds”) by the State of Ohio (the “Issuer”), acting by and through the Director of Development Services Agency of the State of Ohio (the “Director”), and related transactions.  This opinion is being rendered pursuant to Section 10(a)(ii)(B) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer”), acting by and through the Treasurer of the State of Ohio (the “Treasurer”) and the Director, acting by and through his duly authorized representative, the Borrower, Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”).  Capitalized terms used in this opinion and not defined shall have the meanings assigned to them in the Bond Purchase Agreement.
In rendering the opinions expressed below, we have examined the following:

C-1

		
	(a)
	the resolution/ordinance passed by the ___________ creating the Borrower (the “Organizational Documents”);

		
	(b)
	the Bylaws of the Borrower, as amended to date (the “Rules and Regulations”);

		
	(c)
	Resolution No. 2012-__ adopted by the board of directors of the Borrower (the “Board”) on __________, 2012, authorizing the execution and delivery of the Loan Agreement and the Bond Purchase Agreement; authorizing the use and distribution of the Official Statement; and authorizing and approving related matters (the “Resolution”);

		
	(d)
	Executed counterparts of (i) the Trust Agreement, dated as of April 1, 1988, as supplemented by the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012, each between the Issuer and The Huntington National Bank, as trustee (the “Trustee”); (ii) the Loan Agreement dated as of December 1, 2012 between the Borrower and the Director; (iii) the Lease Agreement dated as of December 1, 2012 from the Borrower to Air Transport International Limited Liability Company (the “Lessee”); (iv) the Assignment of Lease dated as of December 1, 2012 from the Borrower to the Director;  (v) the Recognition, Non-Disturbance and Attornment Agreement dated as of December 1, 2012 among the Director and the Borrower; (vi) the Bond Purchase Agreement; and (vii) the Official Statement dated December 17, 2012 with respect to the Bonds (the “Official Statement”) (items (ii)through (vi) are collectively referred to as the “Borrower Documents”).

		
	(e)
	Such statutes, regulations, rulings and judicial decisions as we have deemed necessary or appropriate.

Insofar as an opinion relates “to our knowledge,” we have relied solely upon the Officer’s Certificate with respect to the accuracy of the matters contained therein and we have not independently verified, inquired into or established the accuracy of such matters.  Although we have not conducted an independent investigation of the accuracy or reasonableness of any of the matters set forth in the Officer’s Certificate, nothing is actually known by the primary attorneys within our firm who have been directly involved in representing the Borrower in connection with the transactions contemplated by the Borrower Documents leading them to question the accuracy of such matters.
Except as specifically set forth above, we have neither reviewed nor requested an examination of the indices or records of any governmental or other agency, authority, instrumentality or entity for purposes of this opinion.  We have assumed, for the purpose of this opinion, without independent verification or investigation, that (i) the signatures by all parties on all documents (other than the signatures of the Borrower) examined by us are genuine, (ii) all documents submitted to us as originals are genuine, (iii) all documents submitted to us as copies conform to the originals, (iv) natural persons signing the documents examined by us at the time of such signing were fully competent and had full legal capacity to execute, deliver and perform their obligations under such documents, and (v) the Borrower Documents have been duly authorized, executed and delivered 

C-2

by all parties thereto other than the Borrower and constitute legal, valid, binding and enforceable obligations of such other parties.
Based solely upon the foregoing, but subject to the qualifications hereinafter set forth, we are of the opinion that:
1.    The Borrower is a port authority and political subdivision, and a body corporate and politic, duly organized and validly existing under the laws of the State of Ohio.  The Borrower has lawful power and authority to: (a) enact the Resolution; (b) execute and deliver the Borrower Documents and authorize the use and distribution of the Official Statement; and (d) perform its obligations under, and consummate the transactions contemplated in, the Resolution, the Borrower Documents, and the Official Statement.
2.    The Resolution has been duly adopted by the Board, has not been amended, modified, supplemented or repealed since the date of its adoption and is in full force and effect.
3.    The Borrower has duly authorized: (a) the execution and delivery of and the due performance of its obligations under the Borrower Documents; (b) the use and distribution of the Official Statement; and (c) the taking of such actions as may be required on the part of the Borrower to perform its obligations under, and consummate the transactions contemplated in, the Borrower Documents and the Official Statement.
4.    The Borrower Documents have been duly executed and delivered by the Borrower and constitute the legal, valid and binding obligations of the Borrower, enforceable in accordance with their respective terms.
5.    The officers of the Board who signed each Borrower Document were at the time of signing, and are at the date of this opinion, duly qualified and appointed members of the  Board and duly qualified and elected officers of the Board and have been duly authorized by the Board to execute and deliver the Borrower Documents and the other documents, agreements, instruments and certifications and other items necessary to carry out and give effect to the transactions contemplated by the Borrower Documents.
6.    The Borrower's approval, execution and delivery of the Borrower Documents, and performance by the Borrower of its obligations thereunder and consummation of the transactions contemplated therein, do not, to our knowledge, constitute a default under or conflict with or result in a breach of or violation of the Organizational Documents, the Rules and Regulations, any resolutions of the Board of the Borrower, or any statute, rule or regulation, any court or administrative order, decree or ruling, or any indenture, mortgage, deed of trust, guaranty or agreement or other instrument to which the Borrower is a party or by which it is or any of its properties are bound.
7.    To our knowledge, there is no action, suit, proceeding, inquiry or investigation at law or in equity before or by any judicial or administrative court, board or agency, pending or, to the best of our knowledge, threatened against the Borrower or any of their properties wherein an unfavorable decision, ruling or finding would materially and adversely affect the Project or the 

C-3

execution, delivery, validity or enforce ability of any of the Borrower Documents, or the consummation of the transactions contemplated thereby.
8.    We have participated in the preparation of the Official Statement and, in connection therewith from time to time, we have had discussions with and made inquiries of officers of the Borrower, the Lessee, the Operating Company, ATSG, and the Underwriter concerning the information contained in the Official Statement.  We have not independently verified and are not passing upon, and do not assume any responsibility for the accuracy, completeness or fairness of presentation of, the information contained in the Official Statement, except as set forth in the following sentence.  During the course of the participation and discussions described above, nothing has come to our attention which has caused us to believe that the information set forth in the Official Statement under the captions “SUMMARY STATEMENT – The Borrower,” and “THE BORROWER,”  (except for the financial statements and other financial and statistical data included therein, as to which we express no opinion), as of the date hereof, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading.
The opinions expressed herein are qualified in their entirety as follows:
(i)    The opinions expressed herein are subject to the effect of any bankruptcy, insolvency, reorganization, moratorium, liquidation, arrangement, fraudulent transfer or similar laws, both state and federal, relating to or affecting creditors’ rights generally or remedies and to general principles of equity;
(ii)    Equitable remedies, including, without limitation, the remedy of specific performance, are generally discretionary with the court and may not be available with respect to the enforcement of the terms or provisions of the Borrower Documents;
(iii)    No opinion is expressed herein concerning the laws of any jurisdiction other than the State of Ohio and the United State of America;
(iv)    No opinion is expressed with respect to filings or registrations with the Securities and Exchange Commission or state securities authorities;
(v)    No opinion is expressed herein with respect to the title of any person to any real or personal property, the existence, creation, enforce ability, perfection or priority of any lien, security interest or other encumbrance in or on any real or personal property, or the recording or filing of any mortgage, deed of trust, financing statement or similar instrument;
(vi)    No opinion is expressed herein with respect to the accuracy or sufficiency of the description of any real or personal property in the Borrower Documents;
(vii)    No opinion is expressed regarding any zoning classification, ordinance or regulation, building code or environmental, safety, historical or archaeological preservation or other requirement relating to the Project, or regarding any governmental permit, license, approval or authorization necessary for the construction, operation or occupancy of the Project;

C-4

 (viii)    No opinion is expressed as to whether a court would limit the exercise or enforcement of rights or remedies against the Borrower under the Borrower Documents (a) in the event of any default by a debtor, if it is determined that such default is not material or if such exercise or enforcement is not reasonably necessary for a creditor’s protection, or (b) if the exercise or enforcement thereof under the circumstances would violate an implied covenant of good faith and fair dealing.
This opinion has been prepared solely for your benefit in your respective capacities under the Borrower Documents and may not be used or relied upon by any other person or for any other purpose without our prior written consent.
Respectfully submitted,

C-5

EXHIBIT D
[OPINION OF COUNSEL TO LESSEE, OPERATING COMPANY, AND GUARANTOR]
December 27, 2012
Director of Development Services Agency
State of Ohio

Treasurer of State
State of Ohio

Stifel, Nicolaus & Company, Incorporated

Brennan, Manna & Diamond, LLC

Brouse McDowell, A Legal Professional Association

The Huntington National Bank, as Trustee

		
	Re:
	$9,055,000 State of Ohio Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds)

Ladies and Gentlemen:

We are counsel to Air Transport International Limited Liability Company (the “Lessee”),Airborne Maintenance and Engineering Services, Inc. (the “Operating Company” or “AMES”), and Air Transport Services Group, Inc. (the “Guarantor”) in connection with certain matters relating to the issuance of the above-captioned bonds (the “Bonds”) by the State of Ohio (the “Issuer”), acting by and through the Director of Development Services Agency of the State of Ohio (the “Director”), and related transactions.  This opinion is being rendered pursuant to Section 10(a)(ii)(C) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer”), acting by and through the Treasurer of the State of Ohio (the “Treasurer”) and the Director, acting by and through his duly authorized representative, the Clinton County Port Authority (the “Borrower”), the Lessee, the Operating Company, the Guarantor, and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”).  Capitalized terms used in this opinion and not defined shall have the meanings assigned to them in the Bond Purchase Agreement.
In rendering the opinions expressed below, we have examined the following:

D-1

		
	(a)
	Copies of the Articles of Organization of the Lessee, as certified by the Secretary of State of Nevada and the Operating Agreement of Lessee, as certified by the Secretary of the Lessee as of the date of this opinion.

		
	(b)
	Copies of the Certificate of Incorporation of the Operating Company and the Guarantor, as certified by the Secretary of State of Delaware and the Bylaws of the Operating Company and the Guarantor, as certified by the Secretary of the Operating Company and the Guarantor, respectively, as of the date of this opinion. 

		
	(c)
	the Certificates of Good Standing of the Lessee, issued by the Secretary of State of Nevada and the Secretary of State of Ohio dated within 30 days of the date of closing.

		
	(d)
	the Certificates of Good Standing of the Operating Company and the Guarantor, issued by the Secretary of State of Delaware and the Secretary of State of Ohio dated within 30 days of the date of closing.

		
	(e)
	Resolution No. 2012-__ (the “Resolution”) adopted by the board of directors of the Lessee (the “Board”) on __________, 2012, authorizing the execution and delivery of the Lease Agreement and the Bond Purchase Agreement; authorizing the use and distribution of the Official Statement; and authorizing and approving related matters (the “Resolution”) and any associated authorizing resolutions passed on by the Operating Company and the Guarantor;

		
	(f)
	Executed counterparts of (i) the Trust Agreement, dated as of April 1, 1988, as supplemented by the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012, each between the Issuer and The Huntington National Bank, as trustee (the “Trustee”); (ii) the Loan Agreement dated as of December 1, 2012 between the Director and the Borrower; (iii) the Lease Agreement dated as of December 1, 2012 from the Borrower to Air Transport International Limited Liability Company (the “Lessee”); (iv) the Leasehold Mortgage, Assignment of Rents, Security Agreement and Fixture Filing dated as of December 1, 2012 from the Lessee to the Director; (v) the Assignment of Lease dated as of December 1, 2012 from the Borrower to the Director;  (vi) the Recognition, Non-Disturbance and Attornment Agreement dated as of December 1, 2012 among the Director and the Borrower; (vii) the Bond Purchase Agreement; and (viii) the Official Statement dated December 17, 2012 with respect to the Bonds (the “Official Statement”) (items (iii), (vii), and (viii) are collectively referred to as the “Transaction Documents”).

		
	(e)
	Such other documents, instruments, and matters of law as we have deemed necessary or appropriate for purposes of this opinion.

[VORYS WILL PROVIDE SUBSTITUTE LANGUAGE] Except as specifically set forth above, we have neither reviewed nor requested an examination of the indices or records of any governmental or other agency, authority, instrumentality or entity for purposes of this opinion.  We have assumed, for the purpose of this opinion, without independent verification or investigation, that (i) the signatures by all parties on all documents (other than the signatures of the Lessee) 

D-2

examined by us are genuine, (ii) all documents submitted to us as originals are genuine, (iii) all documents submitted to us as copies conform to the originals, (iv) natural persons signing the documents examined by us at the time of such signing were fully competent and had full legal capacity to execute, deliver and perform their obligations under such documents, and (v) the Transaction Documents have been duly authorized, executed and delivered by all parties thereto other than the Lessee, Operating Company and Guarantor, and constitute legal, valid, binding and enforceable obligations of such other parties.]
Based solely upon the foregoing, but subject to the qualifications hereinafter set forth, we are of the opinion that:
1.    The Lessee is a limited liability company validly existing and in good standing under the laws of the State of Nevada and is qualified to do business in the State of Ohio.  The Lessee has lawful power and authority to: (a) enact the Resolution; (b) execute and deliver the Transaction Documents and authorize the use and distribution of the Transaction Documents; and (d) perform its obligations under, and consummate the transactions contemplated in the Resolution, the Transaction Documents, and the Official Statement.
2.    The Operating Company and the Guarantor are each corporations validly existing and in good standing under the laws of the State of Delaware, are each qualified to do business in the State of Ohio, and have lawful power an authority to perform its obligations under, and consummate the transactions contemplated in the Resolution, the Transaction Documents, and the Official Statement. 
3.    The Resolution has been duly adopted by the Board, has not been amended, modified, supplemented or repealed since the date of its adoption and is in full force and effect.
4.    The Transaction Documents have been duly executed and delivered by the Lessee, the Operating Company, and the Guarantor, and are valid and binding obligations of the Lessee, the Operating Company, and the Guarantor, respectively, enforceable against them in accordance with their terms.  The Lessee, the Operating Company, and the Guarantor have duly approved the use and distribution by the Underwriter of the Preliminary Official Statement and the Official Statement.
5.    The execution and delivery by the Lessee of the Transaction Documents and the performance by the Lessee of its obligations under the Transaction Documents do not and will not violate or constitute a default under (a) the Lessee’s Articles of Organization or Operating Agreement, each as now in effect, (b) any applicable law, statute, regulation or rule, (c) any court or administrative order, decree or ruling, or (d) any agreement, indenture, mortgage, lease, note or other obligation or instrument binding upon the Lessee, or any of its properties or assets.
6.    The execution and delivery by the Operating Company and the Guarantor of the Transaction Documents and the performance by the Operating Company and the Guarantor of its obligations under the Transaction Documents do not and will not violate or constitute a default under (a) the Operating Company’s or Guarantor’s Certificate of Organization or Bylaws, each as now in effect, (b) any applicable law, statute, regulation or rule, (c) any court or administrative 

D-3

order, decree or ruling, or (d) any agreement, indenture, mortgage, lease, note or other obligation or instrument binding upon the Operating Company or the Guarantor, or any of their properties or assets.
7.    To our knowledge, no authorization, consent, approval, license or exemption by, or filing or registration with, any court or governmental department, commission, board, bureau, agency or instrumentality is necessary for the valid execution, delivery and performance by the Lessee, the Operating Company, or the Guarantor of any of the Transaction Documents.
8.    To our knowledge, no temporary restraining order, injunction or stop order suspending the delivery or sale of the Bonds, or the execution and delivery of the Transaction Documents, is in effect, and, no proceedings for that purpose are pending before, or threatened by, the Securities and Exchange Commission or any state securities commission or authority.
9.    To our knowledge, there is no action, suit, proceeding, inquiry or investigation at law or in equity before or by any judicial or administrative court, board or agency, pending or, to the best of our knowledge, threatened in writing against the Lessee, Operating Company, or Guarantor or any of its properties wherein an unfavorable decision, ruling or finding would materially and adversely affect the Project or the execution, delivery, validity or enforceability of any of the Transaction Documents, or the consummation of the transactions contemplated thereby.
10.    We have participated in the preparation of the Official Statement and, in connection therewith from time to time, we have had discussions with and made inquiries of officers of the Lessee and the Underwriter concerning the information contained in the Official Statement.  We have not independently verified and are not passing upon, and do not assume any responsibility for the accuracy, completeness or fairness of presentation of, the information contained in the Official Statement, except as set forth in the following sentence.  During the course of the participation and discussions described above, nothing has come to our attention which has caused us to believe that the information set forth in the Official Statement under the captions “SUMMARY STATEMENT – The Lessee,” “SUMMARY STATEMENT – The Operating Company,” “SUMMARY STATEMENT – The Project,” “THE PROJECT,” “THE LESSEE,” “THE OPERATING COMPANY,” and “SOURCES AND USES OF FUNDS” (except for the financial statements and other financial and statistical data included therein, as to which we express no opinion), as of the date hereof, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading.
The opinions expressed herein are qualified in their entirety as follows:
[VORYS WILL PROVIDE SUBSTITUTE LANGUAGE] (i)    The opinions expressed herein are subject to the effect of any bankruptcy, insolvency, reorganization, moratorium, liquidation, arrangement, fraudulent transfer or similar laws, both state and federal, relating to or affecting creditors’ rights or remedies and to general principles of equity;

D-4

(ii)    Equitable remedies, including, without limitation, the remedy of specific performance, are generally discretionary with the court and may not be available with respect to the enforcement of the terms or provisions of the Transaction Documents;
(iii)    No opinion is expressed herein concerning the laws of any jurisdiction other than the State of Ohio and the United State of America;
(iv)    No opinion is expressed with respect to filings or registrations with the Securities and Exchange Commission or state securities authorities;
(v)    No opinion is expressed herein with respect to the title of any person to any real or personal property, the existence, creation, enforce ability, perfection or priority of any lien, security interest or other encumbrance in or on any real or personal property, or the recording or filing of any mortgage, deed of trust, financing statement or similar instrument;
(vi)    No opinion is expressed herein with respect to the accuracy or sufficiency of the description of any real or personal property in the Transaction Documents;
(vii)    No opinion is expressed regarding any zoning classification, ordinance or regulation, building code or environmental, safety, historical or archaeological preservation or other requirement relating to the Project, or regarding any governmental permit, license, approval or authorization necessary for the construction, operation or occupancy of the Project;
(viii)    Indemnification provisions in the Transaction Documents may be unenforceable as contrary to public policy;
(ix)    No opinion is expressed as to whether a court would limit the exercise or enforcement of rights or remedies against the Lessee, Operating Company, or Guarantor, under the Transaction Documents (a) in the event of any default by a debtor, if it is determined that such default is not material or if such exercise or enforcement is not reasonably necessary for a creditor’s protection, or (b) if the exercise or enforcement thereof under the circumstances would violate an implied covenant of good faith and fair dealing.
This opinion has been prepared solely for your benefit in your respective capacities under the Transaction Documents and may not be used or relied upon by any other person or for any other purpose without our prior written consent.
Respectfully submitted,

D-5

EXHIBIT E
[OPINION OF COUNSEL TO UNDERWRITER]

December 27, 2012

To:    Stifel, Nicolaus & Company, Incorporated

		
	Re:
	$9,055,000 State of Ohio Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority -AMES Project) (Tax-Exempt Bonds)

This opinion is rendered pursuant to Section 10(a)(ii)(D) of the Bond Purchase Agreement, dated _________ __, 2012 (the “Bond Purchase Agreement”) among you, the State of Ohio (the “Issuer”), acting by and through the Treasurer of the State of Ohio (the “Treasurer”) and the Director of Development Services Agency of the State of Ohio, acting by and through his duly authorized representative (the “Director”), Clinton County Port Authority (the “Borrower”), and Air Transport International Limited Liability Company (the “Lessee”) relating to your purchase from the Issuer of its $9,055,000 State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) (the “Bonds”).  We have acted as your special counsel in connection with your purchase of the Bonds pursuant to the Bond Purchase Agreement. 
We have examined the Official Statement dated December 17, 2012 (the “Official Statement”) relating to the Bonds, and copies of executed counterparts of the Bond Purchase Agreement and the Trust Agreement dated as of April 1, 1988, between the Issuer and The Huntington National Bank, as trustee (the “Trustee”), as supplemented by the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012 (collectively, the “Trust Agreement”).  We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such other instruments, records, certificates and documents, and have reviewed such other information and made such investigations, as we have deemed necessary or appropriate for purposes of rendering this opinion.
In accordance with our understanding with you, for purposes of this opinion, we have relied on the opinion dated as of this date of Brouse McDowell, A Legal Professional Association, bond counsel, as to, among other things, the validity of the Bonds and their binding effect upon the Issuer and the exclusion from gross income for federal income tax purposes and other tax treatment of the interest on the Bonds.

E-1

We have assumed compliance by you with all applicable dealer and broker registration or licensing requirements and with all applicable statutes, rules and regulations with respect to the registration or licensing of your salespersons, agents or representatives.
Based on the foregoing, it is our opinion, under existing law, that:
1.    The Bonds are exempt securities under the Securities Act of 1933, as amended (the “1933 Act”), and it is not necessary in connection with the offering and sale of the Bonds to register the Bonds under the 1933 Act.
2.    It is not necessary in connection with the offering and sale of the Bonds to qualify the Trust Agreement or the Bonds under the Trust Indenture Act of 1939, as amended.
While we have examined the Official Statement, we have not undertaken or determined independently the accuracy or completeness of or to verify the information contained in the Official Statement, including the appendices and exhibits thereto, and we express no opinion as to the correctness or completeness of the information contained in the Official Statement, including the appendices and exhibits thereto.  In the course of the preparation of the Official Statement, we participated in discussions with representatives of the Issuer, the Borrower, Brouse McDowell, A Legal Professional Association, as bond counsel, and your representatives.  Based upon our examination of the Official Statement and our participation in the discussions referred to above, nothing has come to our attention which leads us to believe that the Official Statement (excluding those portions noted in the following sentence as to which we do not so advise) contained as of its date, or contains as of the date hereof, any untrue statement of a material fact or omitted as of its date, or omits as of the date hereof, to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.  Reference in this paragraph to the Official Statement does not include, in accordance with our understanding with you, the information contained in the Official Statement under the captions “SUMMARY STATEMENT –  The Borrower,” “SUMMARY STATEMENT –  The Lessee,” “SUMMARY STATEMENT – The Project,” “INTRODUCTORY STATEMENT,” “BOOK-ENTRY ONLY,” “THE PROJECT,” “THE BORROWER,” “THE LESSEE,” and Appendices B and C and the information contained in the Official Statement relating to economic, financial, statistical or quantitative information, projections, or estimates, together with statements dependent upon any of the foregoing information, projections or estimates, and opinions of other counsel.
This opinion is solely for your benefit specifically in connection with the transactions contemplated by the Bond Purchase Agreement, and may not be used in connection with any other transactions or relied upon, used, circulated, quoted or referred to without our prior written approval.  We disclaim any obligation to update this opinion for events occurring or coming to our attention after the date hereof.
Respectfully submitted,

E-2

EXHIBIT F
[OPINION OF THE ASSISTANT ATTORNEY GENERAL 
ASSIGNED TO THE DIRECTOR OF DEVELOPMENT SERVICES AGENCY]

December 27, 2012

Stifel, Nicolaus & Company, Incorporated

Brouse McDowell, A Legal Professional Association

Brennan, Manna & Diamond, LLC

Vorys, Sater, Seymour and Pease, LLP

		
	Re:
	$9,055,000 State of Ohio Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds)

Ladies and Gentlemen:
This opinion is being rendered pursuant to Section 10(a)(ii)(E) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer” or the “State”), acting by and through the Treasurer of State of the State (the “Treasurer”) and the Director of Development Services Agency of the State (the “Director”), the Clinton County Port Authority (the “Borrower”), Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”) relating to the issuance and sale by the Issuer of its State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds), in the aggregate principal amount of $9,055,000 (the “Bonds”).  I am currently the Assistant Attorney General of Ohio assigned to give advice to the Director and the Development Services Agency of Ohio.
I have examined the Preliminary Official Statement dated November 29, 2012 (the “Preliminary Official Statement”) and the Official Statement dated December 17, 2012 (the “Official Statement”) pertaining to the Bonds.  I also have examined originals or copies, certified or otherwise identified to my satisfaction, of other documents, resolutions, instruments, records, certificates and opinions, have reviewed other laws and information and have made investigations, as I have considered necessary or appropriate for the purpose of delivering this letter.
Based on the foregoing, I offer the following information:

F-1

1.    To the best of my knowledge, there is no litigation now pending or threatened contesting the validity of the Bonds, the proceedings for the authorization, issuance, sale, execution and delivery of the Bonds or the authority of the Director of Development Services Agency of the State of Ohio to conduct any programs (the “Chapter 166 Programs”) under Chapter 166 of the Ohio Revised Code, including those he currently administers thereunder.
2.    To the best of my knowledge, and in my opinion, the ultimate disposition, which is not presently determinable, of the various legal proceedings to which the State of Ohio is a party, and which are unrelated to the Bonds or the security for them or to the Chapter 166 Programs, will not have a material adverse effect on the Bonds, the security for the Bonds or the Chapter 166 Programs.
3.    To the best of my knowledge, the title of the Governor, the Auditor of State, the Secretary of State, the Treasurer and the Director to their respective offices is not now being contested.
While I am not passing upon, and do not assume responsibility for, the accuracy, completeness or fairness of the contents of the Preliminary Official Statement or the Official Statement, nothing has come to my attention which leads me to believe that the sections entitled “THE OHIO ENTERPRISE BOND FUND PROGRAM,” “SUMMARY OF CHAPTER 166 PROGRAMS” and “CHAPTER 166 DIRECT LOAN PROGRAM NET REVENUES” contained in the Preliminary Official Statement as its date, or the Official Statement at its date or as of this date, contained or contains any untrue statement of a material fact or omitted or omits to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.
I have also verified that the Director has received an opinion of counsel to the Borrower of the loans made under the Chapter 166 Direct Loan Program (as defined in the Official Statement) and that the Loan Documents have been duly executed by the Borrower and are valid and enforceable against the Borrower in accordance with their terms, subject to certain exceptions such as the effect that bankruptcy and similar laws and principles of equity may have on such enforceability.
Respectfully submitted,

[To be executed by the Assistant Attorney General assigned to the Development Service Agency’s Office]

F-2

EXHIBIT G
$9,055,000 
State of Ohio 
State Economic Development Revenue Bonds 
(Ohio Enterprise Bond Fund) 
Series 2012-9 
(Clinton County Port Authority -AMES Project) 
(Tax-Exempt Bonds)
CERTIFICATE OF THE STATE OF OHIO
The undersigned, pursuant to Section 10(a)(iii) of the Bond Purchase Agreement  dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer” or the “State”), acting by and through the Treasurer of State of the State (the “Treasurer”) and the Director of Development Services Agency of the State (the “Director”), Clinton County Port Authority (the “Borrower”), Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), hereby certifies on behalf of the Issuer that as of the date hereof:
1.    I am the duly appointed Treasurer of State of the State.
2.    No litigation or administrative action is pending or, to the best of my knowledge, threatened (a) to restrain or enjoin, or seeking to restrain or enjoin, the issuance and delivery of any of the Issuer’s $9,055,000 State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) (the “Bonds”), or the collection and application of the Pledged Receipts, Program Transfer Account and any other moneys or revenues pledged or committed under the Trust Agreement, dated as of April 1, 1988, between the Issuer and The Huntington National Bank, as successor trustee (the “Trustee”), and under the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012, between the Issuer and the Trustee (collectively, the “Trust Agreement”), (b) in any way contesting or affecting the authority for the issuance of the Bonds or the validity of the Bonds, the General Bond Order duly adopted by my predecessor on April 11, 1988, the Series Bond Order duly adopted by me on December 13, 2012, authorizing the issuance of the Bonds (collectively, the “Order”), the Trust Agreement, the Bond Purchase Agreement or any provision thereof, or the collection and application of the Pledged Receipts, Program Transfer Account and any other moneys or revenues pledged under the Trust Agreement, (c) in any way contesting the existence or powers of the Issuer or me.
3.    The representations and warranties of the Issuer and/or the Treasurer in the Bonds, the Trust Agreement and the Bond Purchase Agreement are true and correct in all material respects as of, and as if made on, the date hereof.
4.    To the best of my knowledge, no event affecting the Issuer, the Treasurer or the Director has occurred since the date of the Official Statement dated December 17, 2012 (the “Official 

G-1

Statement”) relating to the Bonds which should be disclosed in the Official Statement in order to make the statements and information therein not misleading in any material respect.
5.    The Issuer has complied with all of the terms of the Bond Purchase Agreement, the Order and the Trust Agreement to be complied by it prior to or concurrently with the Closing (as defined in the Bond Purchase Agreement).
6.    The undersigned further certifies that the Continuing Disclosure Agreement contained in the Trust Agreement (the “Continuing Disclosure Agreement”) and the description of the Continuing Disclosure Agreement provided in the Official Statement have been approved, and the undersigned agrees to accept and perform the duties assigned to the undersigned in the Continuing Disclosure Agreement.
IN WITNESS WHEREOF, I have hereunto set my hand this 27th__ day of December, 2012.
STATE OF OHIO

By:        
Josh Mandel
State Treasurer of Ohio

 

G-2

EXHIBIT H
$9,055,000 
State of Ohio 
State Economic Development Revenue Bonds 
(Ohio Enterprise Bond Fund) 
Series 2012-9 
(Clinton County Port Authority - AMES Project) 
(Tax-Exempt Bonds)
CERTIFICATE OF THE DIRECTOR OF  
OHIO DEVELOPMENT SERVICES AGENCY
The undersigned authorized representative of the Director of the Ohio Development Services Agency (the “Director”) pursuant to Section 10(a)(iv) of the Bond Purchase Agreement  dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer” or the “State”), acting by and through the Treasurer of State of the State (the “Treasurer”) and the Director of Development Services Agency of the State (the “Director”), Clinton County Port Authority. (the “Borrower”), Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), hereby certifies with respect to the Official Statement dated December 17, 2012 (the “Official Statement”) relating to the captioned $9,055,000 State of Ohio State Economic Development Revenue Bonds (Ohio Enterprise Bond Fund) Series 2012-9 (Clinton County Port Authority - AMES Project) (Tax-Exempt Bonds) (the “Bonds”) that as of the date hereof:
1.    No material adverse change has occurred in the condition (financial or otherwise) of the economic development programs I administer under Chapter 166 of the Ohio Revised Code (the “Act”), whether or not arising from transactions arising in the ordinary course of business.
2.    No litigation or administrative action is pending or, to the best of my knowledge, threatened against the Director (a) to restrain or enjoin, or seeking to restrain or enjoin, the issuance and delivery of any of the Bonds, or the collection and application of the Pledged Receipts or the Program Transfer Account as defined in the Trust Agreement (the “Trust Agreement”), dated as of April 1, 1988, between the Issuer and The Huntington National Bank, as successor trustee (the “Trustee”), the terms of which have been agreed to by the Director; the execution and delivery of the Loan Agreement dated as of December 1, 2012 (the “Loan Agreement”) between the Director and the Borrower; or any other moneys or revenues pledged under the Trust Agreement; (b) in any way contesting or affecting the authority for the issuance of the Bonds or the validity of the Bonds, the General Bond Order duly adopted on April 11, 1988, by the Treasurer, the Series Bond Order No. R9-12 duly adopted on December 13, 2012, by the Treasurer authorizing the issuance of the Bonds; and the execution of the Trust Agreement and the One Hundred Twenty-Eighth Supplemental Trust Agreement dated as of December 1, 2012 (the “Supplement”) between the Issuer and the Trustee, the Loan Agreement, the Official Statement, the Bond Purchase Agreement or the collection and application of the Pledged Receipts, the Program Transfer Account and any other moneys or revenues pledged under the Trust Agreement and the Supplement, or (c) in any way contesting the powers of the Director.

H-1

3.    To the best of my knowledge, no event affecting the Director or the economic development programs administered by the Director, including those administered under the Act, has occurred since the date of the Official Statement which should be disclosed in the Official Statement in order to make the statements and information therein not misleading in any material respect.
4.    As of its date and the date hereof, the Official Statement is true, correct and complete in all material respects and does not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they are made, not misleading; provided, however, no representation is made as to information contained under the headings “SUMMARY STATEMENT – The Borrower,” “SUMMARY STATEMENT – The Lessee,” “SUMMARY STATEMENT – The Project,” “THE PROJECT,” “THE BORROWER,” “THE LESSEE,” “SOURCES AND USES OF FUNDS,” “TAX MATTERS,” “ELIGIBILITY UNDER OHIO LAW FOR INVESTMENT AND AS SECURITY FOR THE DEPOSIT OF PUBLIC MONEYS,” and “LEGAL MATTERS.”
5.    The representations and warranties of the Director contained in the Bond Purchase Agreement and the Loan Agreement are true and correct in all material respects as of and as if made on the date hereof.
6.    The Director has complied with all of the terms of the Bond Purchase Agreement to be complied with by the Director prior to or concurrently with the Closing (as defined in the Bond Purchase Agreement).
IN WITNESS WHEREOF, the duly authorized representative of the Director has hereunto set her hand this 27th day of December, 2012.
DIRECTOR OF DEVELOPMENT SERVICES AGENCY, STATE OF OHIO

By:     
    

EXHIBIT I
$9,055,000 
State of Ohio 
State Economic Development Revenue Bonds 
(Ohio Enterprise Bond Fund) 
Series 2012-9 
(Clinton County Port Authority - AMES Project) 
(Tax-Exempt Bonds)

H-2

CERTIFICATE OF CLINTON COUNTY PORT AUTHORITY  
PURSUANT TO THE BOND PURCHASE AGREEMENT
The undersigned officer of Clinton County Port Authority (the “Borrower”), pursuant to Section 10(a)(v) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer” or the “State”), acting by and through the Treasurer of State of the State (the “Treasurer”) and the Director of Development Services Agency of the State (the “Director”),the Borrower, Air Transport International Limited Liability Company (the “Lessee”), and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), hereby certifies as follows as of the date hereof (all capitalized terms used herein are used as defined in the Bond Purchase Agreement):
1.    Each of the representations and warranties of the Borrower set forth in Section 4 in the Bond Purchase Agreement and in the Loan Documents are true and correct on the date hereof as if made on and as of the date hereof;
2.    Each of the agreements of the Borrower to be complied with and each of the obligations of the Borrower to be performed under the Bond Purchase Agreement and the Loan Documents on or prior to the date hereof has been complied with and performed; and 
3.    The Borrower has obtained all approvals and authorizations required at the date hereof for its consummation of the transactions contemplated by the Loan Documents and the Bond Purchase Agreement, including all consents, approvals, authorizations and orders of governmental or regulatory authorities which are required at the date hereof for the Borrower’s execution and delivery of the Loan Documents to which it is a party and the Bond Purchase Agreement.
CLINTON COUNTY PORT AUTHORITY

By:    ______________________________
Name:    ______________________________
Title:    ______________________________
Date:    December 27, 2012

I-1

EXHIBIT J
$9,055,000 
State of Ohio 
State Economic Development Revenue Bonds 
(Ohio Enterprise Bond Fund) 
Series 2012-9 
(Clinton County Port Authority - AMES Project) 
(Tax-Exempt Bonds)
CERTIFICATE OF LESSEE PURSUANT TO THE BOND PURCHASE AGREEMENT

The undersigned officer of the Air Transport International Limited Liability Company (the “Lessee”), pursuant to Section 10(a)(vi) of the Bond Purchase Agreement dated December 13, 2012 (the “Bond Purchase Agreement”) among the State of Ohio (the “Issuer”), acting by and through the Treasurer of State of the State of Ohio (the “Treasurer”) and the Director of Development Service of the State of Ohio (the “Director”), the Clinton County Port Authority, the Lessee and Stifel, Nicolaus & Company, Incorporated (the “Underwriter”), hereby certifies as follows as of the date hereof (all capitalized terms used herein are used as defined in the Bond Purchase Agreement) to the best of its knowledge:
1.    Each of the representations and warranties of the Lessee set forth in the Bond Purchase Agreement is true and correct on the date hereof as if made on and as of the date hereof;
2.    Each of the agreements of the Lessee to be complied with and each of the obligations of the Borrower to be performed under the Bond Purchase Agreement on or prior to the date hereof has been complied with and performed; and
3.    The Lessee has obtained all approvals and authorizations required at the date hereof for its consummation of the transactions contemplated by the Bond Purchase Agreement, including all consents, approvals, authorizations and orders of governmental or regulatory authorities which are required at the date hereof for the Lessee’s execution and delivery of the Bond Purchase Agreement.
Air Transport International Limited Liability Company
By:    ______________________________
Name:    ______________________________
Title:    ______________________________
Date:    December 27, 2012

J-1

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