Document:

Exhibit

10.26

 

EXECUTION

COPY

 

WILLIS

ENGINE FUNDING LLC*

Issuer

 

 

and

 

 

THE BANK

OF NEW YORK

Indenture

Trustee

 

 

SERIES

2002-1 SUPPLEMENT

 

Dated

as of September 12, 2002

 

to

 

INDENTURE

 

Dated

as of September 12, 2002

 

 

SERIES

2002-1 NOTES

 

 

*              Portions

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

confidential treatment, and the redacted material has been filed separately

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

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

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

to a request for confidential treatment.

 

 

TABLE OF

CONTENTS

 

	

  ARTICLE

  I

  	

  DEFINITIONS;

  CALCULATION GUIDELINES

  
	

   

  	

   

  
	

  Section 1.1

  	

  Definitions

  
	

  Section 1.2

  	

  Calculation Guidelines

  
	

   

  	

   

  
	

  ARTICLE

  II

  	

  CREATION OF THE

  SERIES 2002-1 NOTES

  
	

   

  	

   

  
	

  Section 2.1

  	

  Designation: General Terms and Conditions

  
	

  Section 2.2

  	

  Interest Payments on the Series 2002-1

  Notes

  
	

  Section 2.3

  	

  Principal Payments on the Series 2002-1

  Notes

  
	

  Section 2.4

  	

  Amounts and Terms of Series 2002-1

  Noteholder Commitments

  
	

  Section 2.5

  	

  Increased Cost; Capital Adequacy; Taxes

  
	

  Section 2.6

  	

  Payments, Computations, Etc.

  
	

   

  	

   

  
	

  ARTICLE III

  	

  SERIES

  2002-1 SERIES ACCOUNT AND ALLOCATION AND APPLICATION OF AMOUNTS THEREIN

  
	

   

  	

   

  
	

  Section 3.1

  	

  Series 2002-1 Series Account

  
	

  Section 3.2

  	

  Distributions from Series 2002-1 Series

  Account on each Payment Date

  
	

  Section 3.3

  	

  Allocation of Excess Cash Available for

  Distribution

  
	

  Section 3.4

  	

  Series 2002-1 Restricted Cash Account

  
	

  Section 3.5

  	

  Series 2002-1 Engine Reserve Account

  
	

  Section 3.6

  	

  Series 2002-1 Security Deposit Account

  
	

  Section 3.7

  	

  Securities Accounts

  
	

   

  	

   

  
	

  ARTICLE

  IV

  	

  ADDITIONAL COVENANTS

  
	

   

  	

   

  
	

  Section 4.1

  	

  Additional Series

  
	

  Section 4.2

  	

  Control Party

  
	

  Section 4.3

  	

  Inspections

  
	

  Section 4.4

  	

  Reserved

  
	

  Section 4.5

  	

  Interest Rate Hedge Agreements

  
	

  Section 4.6

  	

  Insurance

  
	

  Section 4.7

  	

  Lessee Acknowledgment

  
	

  Section 4.8

  	

  Opinions of Foreign Local Counsel

  
	

  Section 4.9

  	

  Filing of Leases with FAA

  
	

   

  	

   

  
	

  ARTICLE

  V

  	

  CONDITIONS

  OF EFFECTIVENESS AND FUTURE LENDING

  
	

   

  	

   

  
	

  Section 5.1

  	

  Effectiveness of Supplement

  
	

  Section 5.2

  	

  Advances on Class A Notes

  
	

  Section 5.3

  	

  Deliveries

  
			

 

i

 

	

  ARTICLE

  VI

  	

  REPRESENTATIONS AND

  WARRANTIES

  
	

   

  	

   

  
	

  Section 6.1

  	

  Existence

  
	

  Section 6.2

  	

  Authorization

  
	

  Section 6.3

  	

  No Conflict; Legal Compliance

  
	

  Section 6.4

  	

  Validity and Binding Effect

  
	

  Section 6.5

  	

  Financial Statements

  
	

  Section 6.6

  	

  Executive Offices

  
	

  Section 6.7

  	

  No Agreements or Contracts

  
	

  Section 6.8

  	

  Consents and Approvals

  
	

  Section 6.9

  	

  Margin Regulations

  
	

  Section 6.10

  	

  Taxes

  
	

  Section 6.11

  	

  Other Regulations

  
	

  Section 6.12

  	

  Solvency and Separateness

  
	

  Section 6.13

  	

  No Proceedings

  
	

  Section 6.14

  	

  Recourse Against Certain Parties

  
	

  Section 6.15

  	

  Survival of Representations and Warranties

  
	

  Section 6.16

  	

  No Event of Default or Early Amortization

  Event

  
	

  Section 6.17

  	

  Litigation and Contingent Liabilities

  
	

  Section 6.18

  	

  Title; Liens

  
	

  Section 6.19

  	

  Subsidiaries

  
	

  Section 6.20

  	

  No Partnership

  
	

  Section 6.21

  	

  Pension and Welfare Plans

  
	

  Section 6.22

  	

  Ownership of Issuer

  
	

  Section 6.23

  	

  Security Interest

  
	

  Section 6.24

  	

  Eligible Lease Agreements; Eligible

  Engines

  
	

   

  	

   

  
	

  ARTICLE VII

  	

  EARLY AMORTIZATION EVENT

  
	

   

  	

   

  
	

  Section 7.1

  	

  Early Amortization Event

  
	

   

  	

   

  
	

  ARTICLE VIII

  	

  MISCELLANEOUS PROVISIONS

  
	

   

  	

   

  
	

  Section 8.1

  	

  Ratification of Indenture

  
	

  Section 8.2

  	

  Counterparts

  
	

  Section 8.3

  	

  Governing Law

  
	

   

  	

   

  
	

  EXHIBITS

  
	

   

  	

   

  
	

  EXHIBIT A

  	

  Form of Class A Note

  
	

  EXHIBIT B

  	

  Form of Class B Note

  
	

  EXHIBIT C

  	

  Eligible Engines, Depreciation Periods and Maximum

  Concentration Limits

  
	

  EXHIBIT D-1

  	

  Lessee Acknowledgment (First Security Bank Form)

  
	

  EXHIBIT D-2

  	

  Lessee Acknowledgment (Willis Form)

  
	

  EXHIBIT E

  	

  Asset Base Certificate

  
	

  EXHIBIT F

  	

  Withdrawal Notice

  
			

 

ii

 

	

  EXHIBIT G

  	

  Funding Deliverables

  
	

  EXHIBIT H-1

  	

  Form of Trust Agreement

  
	

  EXHIBIT H-2

  	

  Form of Owner Trustee Guaranty

  
	

  EXHIBIT H-3

  	

  Form of Owner Trustee Mortgage

  
	

  EXHIBIT H-4

  	

  Form of Beneficial Interest Pledge Agreement

  
	

  EXHIBIT J-1

  	

  Form of Portfolio Report

  
	

  EXHIBIT J-2

  	

  Form of Principal Report

  
	

   

  	

   

  
	

  SCHEDULES

  
	

   

  	

   

  
	

  SCHEDULE

  1

  	

  Certain

  Terms

  
	

  SCHEDULE

  2

  	

  Initial

  List of Engines and Lease Agreements

  

 

iii

 

SERIES 2002-1 SUPPLEMENT, dated as of September 12,

2002 (the “Supplement” or the “Series 2002-1 Supplement”), between Willis

Engine Funding LLC, a limited liability company organized and existing under

the laws of the State of Delaware (the “Issuer”), and The Bank of New York, a

New York banking corporation, as Indenture Trustee (the “Indenture Trustee”).

 

Pursuant to the Indenture, dated as of September 12, 2002

(as amended and supplemented, the “Indenture”), between the Issuer and the

Indenture Trustee, the Issuer may from time to time direct the Indenture

Trustee to authenticate one or more new Series of Notes.  The Principal Terms of any new Series are to

be set forth in a Supplement to the Indenture.

 

Pursuant to this Supplement, the Issuer and the

Indenture Trustee wish to create the Series 2002-1 Notes and specify the

Principal Terms thereof.

 

The parties hereto have agreed to enter into such

transactions but only upon the terms and conditions hereinafter set forth and

in reliance on the representations and warranties of the Issuer set forth

herein.

 

NOW THEREFORE, in consideration of the mutual

agreements herein contained, the parties hereto agree as follows:

 

ARTICLE

I

 

DEFINITIONS; CALCULATION GUIDELINES

 

Section

1.1            Definitions.

 

(a)           Capitalized

terms used in this Supplement but not defined herein shall have the meaning

assigned to such terms in the Indenture. 

Whenever used in this Supplement, the following words and phrases shall

have the following meanings, and the definitions of such terms are applicable

to the singular as well as the plural forms of such terms and to the masculine

as well as to the feminine and neuter genders of such terms.

 

“Administrative Agent Fee” means the fee

payable by the Issuer to the Administrative Agent pursuant to Section 2.4(e)

hereof.

 

“Africa/Middle East/Emerging Europe” has the

meaning set forth in Schedule 1 attached hereto.

 

“Aggregate Note Principal Balance” means the

sum of the Class A Note Principal Balance and the Class B Note Principal

Balance.

 

“Aggregate Required Amortization Amount”

means as of any Payment Date on or after the Conversion Date, if no Early

Amortization Event has occurred or is continuing on such Payment Date, an

amount equal to the excess, if any, of (1) the sum of (A) the product of

(i) ninety-percent (90%) and (ii) all Engine Revenues actually

received by, or on behalf of, the Issuer during the related Collection Period

with respect to the Series 2002-1 Engines and (B) the product of (x) a

fraction, expressed as a percentage, the numerator of which shall equal the

 

 

Aggregate Note Principal Balance (prior to giving effect to any

payments of principal on such Payment Date) and the denominator of which shall

equal the sum of the Net Book Values of all Series 2002-1 Engines (calculated

as of the last day of the immediately preceding month) and (y) the greater of

(i) the sum of the Net Book Values of all Series 2002-1 Engines sold

during the related Collection Period (which Net Book Values will be determined

as of the last day of the month immediately preceding such sale), and

(ii) the aggregate Sales Proceeds of all Series 2002-1 Engines sold during

the related Collection Period, over (2) the sum of the amounts paid pursuant to

clauses (A) through (G) inclusive, (I) and (J) of Section 3.2(I).

 

“Alternate Base Rate” means, on any date, a

fluctuating rate of interest per annum equal to the greater of:

 

(i)            the

rate of interest most recently announced by Barclays Bank PLC at its branch

office in New York, New York as its prime or reference rate; and

 

(ii)           the

Federal Funds Rate plus 0.50%.

 

“Alternative Rate” shall mean, with respect

to any Interest Accrual Period (or portion thereof), an interest rate per annum

equal to the Eurodollar Rate (Reserve Adjusted); provided, however, that:

 

(i)            if

the Deal Agent shall have determined as of the applicable rate determination

date that a Eurodollar Rate Disruption Event has occurred and is continuing,

then the “Alternative Rate” for such Interest Accrual Period (or portion

thereof) shall be an interest rate per annum equal to the Alternate Base Rate

in effect from time to time during such Interest Accrual Period (or portion

thereof) unless the Deal Agent and the Issuer agree in writing to a different

rate;

 

(ii)           if

the Deal Agent shall have determined as of the applicable rate determination

date that the Eurodollar Rate for any Interest Accrual Period (or portion

thereof) does not accurately reflect the cost to the Holders of funding their

respective investments in the Series 2002-1 Notes for such Interest Accrual

Period (or portion thereof), then the “Alternative Rate” with respect to such

Interest Accrual Period (or portion thereof) shall be an interest rate per

annum equal to the Alternate Base Rate in effect from time to time during such

Interest Accrual Period (or portion thereof) unless the Deal Agent and the

Issuer agree in writing to a different rate;

 

(iii)          if for any reason the Alternative Rate

becomes applicable on notice to the Deal Agent of less than three Eurodollar

Business Days, the “Alternative Rate” shall be the Alternate Base Rate in

effect from time to time during the period prior to the satisfaction of such

three Eurodollar Business Days’ notice requirement; and

 

(iv)          notwithstanding

anything to the contrary in clauses (i) through (iii) above, at all

times following the occurrence of an Early Amortization Event or an Event of

Default, the “Alternative Rate” for any Interest Accrual Period shall be a rate

per annum equal to the Alternate Base Rate in effect from time to time during

such Interest Accrual Period, unless the Deal Agent and the Issuer agree in

writing to a different rate.

 

2

 

“Applicable Percentage” has the meaning set

forth in Schedule 1 attached hereto.

 

“Asset Base” means, as of any Payment Date,

an amount equal to (1) the sum of (a) the product of (i) the Applicable

Percentage and (ii) the sum of (x) the Aggregate Net Book Value as of the

end of the immediately preceding Collection Period of all Eligible Engines

pledged to Series 2002-1 and (y) an amount calculated as of the end of the

immediately preceding Collection Period by applying the Depreciation Policy to

Capital Improvements made to the Eligible Engines pledged to Series 2002-1, and

(b) the amount on deposit in the related Restricted Cash Account for Series

2002-1 on such Payment Date, after giving effect to all deposits to and

withdrawals from such Restricted Cash Account on such Payment Date, minus (2)

the sum of (a) any Maintenance Reserve Payments and Security Deposits relating

to such Eligible Engines pledged to Series 2002-1 that are not then on deposit

in the related Engine Reserve Account and the related Security Deposit Account,

respectively, and (b) the Excess Concentration Amount, unless such Excess

Concentration Amount has been waived by the Control Party for Series 2002-1.

 

“Breakage Costs” means any amount or amounts

as shall compensate a Purchaser for any loss, cost or expense (in any event

excluding lost profits) incurred by such Purchaser in connection with funding

obtained by it with respect to a Loan (as reasonably determined by the Deal

Agent in its sole discretion on behalf of the Purchaser) as a result of a

prepayment by the Issuer of principal or Interest pursuant to the terms hereof.

 

“Class A Increased Costs” has the meaning

set forth in the Class A Note Purchase Agreement.

 

“Class A Loan” means any Loan funded

pursuant to the Class A Note Purchase Agreement.

 

“Class A Maximum Limit” means the lesser of

(i) $180,000,000 and (ii) such lesser amount as may be specified by

the Issuer in writing to the Deal Agent pursuant to Section 2.05 of the Class A

Note Purchase Agreement in connection with a concurrent pro rata reduction of

the Class B Maximum Limit pursuant to Section 2.05 of the Class B Note Purchase

Agreement.

 

“Class A Note” means any one of the Class A

Notes of Series 2002–1 issued pursuant to the terms of this Supplement,

substantially in the form of Exhibit A to this Supplement.

 

“Class A Note Commitment” has the meaning

set forth in Schedule 1 attached hereto.

 

“Class A Note Distributable Amortization Amount”

means, for any Payment Date on or after the Conversion Date, the sum of (x) the

Class A Note Required Amortization Amount for such Payment Date and (y) any

Class A Note Distributable Amortization Amount remaining unpaid from prior

Payment Dates.

 

“Class A Note Interest Arrearage” means, for

any Payment Date, an amount equal to the excess, if any, of (a) the Class A

Note Interest Payment for such Payment Date and any outstanding Class A Note

Interest Arrearage from the immediately preceding Payment Date plus interest on

any outstanding Class A Note Interest Arrearage, to the extent permitted by

law, at

 

3

 

the Overdue Rate over (b) the amount of Class A Note Interest Payment

and Class A Note Interest Arrearage actually distributed to the Class A Note

Purchaser on such Payment Date.

 

“Class A Note Interest Payment” means, as of

any Payment Date, the amount of Interest accrued on the Class A Loans during

the immediately preceding Interest Accrual Period.

 

“Class A Note Minimum Principal Payment Amount”

means, for any Payment Date, the amount set forth in clause (A) or (B), as

applicable:

 

(A)          If no Early Amortization

Event has occurred or is continuing on such Payment Date, an amount equal to

the excess, if any, of (1) the Class A Note Principal Balance over

(2) the Senior Asset Base; or

 

(B)           If an Early

Amortization Event has occurred or is continuing, all remaining amounts on

deposit in the Series 2002-1 Series Account after payment of the amounts set

forth in clauses (A) through (J), inclusive, of Section 3.2(II) of this

Supplement, until the Class A Note Principal Balance is reduced to zero.

 

“Class A Note Principal Balance” means an

amount equal to the excess of (x) the sum of (A) the outstanding principal

balance of the Class A Notes on the Closing Date plus (B) the principal balance

of all Class A Loans made subsequent to the Closing Date, minus (y) all amounts

paid to the Class A Note Purchaser representing the sum of the following, to

the extent actually received by the Class A Note Purchaser: (i) Class A

Note Minimum Principal Payment Amounts, (ii) Class A Note Distributable

Amortization Amounts, (iii) Prepayments of principal of the Class A Notes

paid to the Class A Note Purchaser, and (iv) repayments of the Class A

Note Principal Balance made pursuant to Section 2.4(c) hereof.

 

“Class A Note Purchase Agreement” means the

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

Issuer, the Servicer, Sheffield and Barclays Bank PLC.

 

“Class A Note Purchaser” shall have the

meaning set forth in the Class A Note Purchase Agreement.

 

“Class A Note Required Amortization Amount”

means, for any Payment Date on or after the Conversion Date, an amount equal to

the product of (x) the Class A Note Principal Balance as of such Payment Date

(prior to giving effect to any payments of principal on such Payment Date) and

(y) the Aggregate Required Amortization Amount for such Payment Date divided by

(z) the Aggregate Note Principal Balance as of such Payment Date (prior to

giving effect to any payments of principal on such Payment Date).

 

“Class B Increased Costs” has the meaning

set forth in the Class B Note Purchase Agreement.

 

“Class B Loan” means any Loan funded

pursuant to the Class B Note Purchase Agreement.

 

4

 

“Class B Maximum Limit” means the lesser of

(i) $20,000,000 and (ii) such lesser amount as may be specified by

the Issuer in writing to the Deal Agent pursuant to Section 2.05 of the Class B

Note Purchase Agreement in connection with a concurrent pro rata reduction of

the Class A Maximum Limit pursuant to Section 2.05 of the Class A Note Purchase

Agreement.

 

“Class B Note” means any one of the Class B

Notes of Series 2002–1 issued pursuant to the terms of this Supplement,

substantially in the form of Exhibit B to this Supplement.

 

“Class B Note Commitment” has the meaning

set forth in Schedule 1 attached hereto.

 

“Class B Note Distributable Amortization Amount”

means, for any Payment Date on or after the Conversion Date, the sum of (x) the

Class B Note Required Amortization Amount for such Payment Date and (y) any

Class B Note Distributable Amortization Amount remaining unpaid from prior

Payment Dates.

 

“Class B Note Interest Arrearage” means, for

any Payment Date, an amount equal to the excess, if any, of (a) the Class B

Note Interest Payment for such Payment Date and any outstanding Class B Note

Interest Arrearage from the immediately preceding Payment Date plus interest on

any outstanding Class B Note Interest Arrearage, to the extent permitted by

law, at the Overdue Rate over (b) the amount of Class B Note Interest Payment

and Class B Note Interest Arrearage actually distributed to the Class B Note

Purchasers on such Payment Date.

 

“Class B Note Interest Payment” means, as of

any Payment Date, the amount of Interest accrued and unpaid on the Class B

Loans during the immediately preceding Interest Accrual Period.

 

“Class B Note Minimum Principal Payment Amount”

means, for any Payment Date, the amount set forth in clause (A) or (B), as

applicable:

 

(A)          If no Early Amortization

Event has occurred or continuing on such Payment Date, an amount equal to the

excess, if any, of (1) the Class B Note Principal Balance over

(2) the Subordinate Asset Base; or

 

(B)           If an Early

Amortization Event has occurred or is continuing, all remaining amounts on deposit

in the Series 2002-1 Series Account after payment of the amounts set forth in

clauses (A) through (K), inclusive, of Section 3.2(II) of this Supplement,

until the Class B Note Principal Balance is reduced to zero.

 

“Class B Note Principal Balance” means an

amount equal to the excess of (x) the sum of (A) the outstanding principal

balance of the Class B Notes on the Closing Date plus (B) the principal balance

of all Class B Loans made subsequent to the Closing Date, minus (y) all amounts

paid to the Class B Note Purchasers representing the sum of the following, to

the extent actually received by the Class B Note Purchasers: (i) Class B

Note Minimum Principal Payment Amounts, (ii) Class B Note Distributable

Amortization Amounts, (iii) Prepayments of principal of the Class B Notes

paid to the Class B Note Purchasers, (iv) repayments of the Class B Note

Principal Balance made pursuant to Section 2.4(c) hereof, and (v) payments

of principal of the Class B Notes made by the Seller pursuant to the Guaranty.

 

5

 

“Class B Note Purchase Agreement” means the

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

Issuer, the Servicer, Barclays Bank PLC and Fortis Bank.

 

“Class B Note Purchaser” shall have the

meaning set forth in the Class B Note Purchase Agreement.

 

“Class B Note Required Amortization Amount”

means, for any Payment Date on or after the Conversion Date, an amount equal to

the product of (x) the Class B Note Principal Balance as of such Payment Date

(prior to giving effect to any payments of principal on such Payment Date) and

(y) the Aggregate Required Amortization Amount for such Payment Date divided by

(z) the Aggregate Note Principal Balance as of such Payment Date (prior to giving

effect to any payments of principal on such Payment Date).

 

“Closing” means the time at which each of

the conditions precedent set forth in Section 5.2 of this Supplement (with

respect to the initial Loan made hereunder) shall have been duly fulfilled or

satisfied.

 

“Closing Date” means the date on which

Closing occurs.

 

“Collateral Custodian” shall mean BNY

Midwest Trust Company, an Illinois corporation, or any successor thereto

satisfactory to the Deal Agent.

 

“Collateral Custodian’s Fees” has the meaning

set forth in Schedule 4 to the Collateral Custody Agreement.

 

“Collateral Custody Agreement” shall mean a

custodial agreement among the Collateral Custodian, the Issuer, the Servicer,

the Indenture Trustee and the Deal Agent, as amended from time to time,

relating to the transactions contemplated hereby.

 

“Commercial Paper Notes” shall mean

short-term promissory notes issued or to be issued by Sheffield Receivables

Corporation.

 

“Conversion Date” means the Payment Date

occurring on September 11, 2003; provided, however, that such

Conversion Date may be extended for a period of no longer than 364 days, if

approved by all of the Holders of the Class A and Class B Notes.

 

“CP Rate” shall mean with respect to any

Interest Accrual Period (or portion thereof), the per annum rate calculated to

yield the “weighted average cost” (as defined below) for such Interest Accrual

Period (or portion thereof) related to the issuance of Commercial Paper Notes;

provided, however, that if any component of such rate is a discount rate, in

calculating the “CP Rate” for such Interest Accrual Period (or portion thereof)

the rate resulting from converting such discount rate to an interest-bearing

equivalent rate per annum shall be used in calculating such component.  As used in this definition, “weighted

average cost” for any Interest Accrual Period (or portion thereof) means the

sum of (i) the actual interest accrued on outstanding Commercial Paper

Notes during such Interest Accrual Period (or portion thereof), (ii) the

commissions of placement agents and dealers in respect of such Commercial Paper

Notes, and (iii) other borrowings by Sheffield, including to fund small or

odd dollar amounts that are not

 

6

 

easily accommodated in the commercial paper market; and provided,

further, that at all times following the occurrence of an Early Amortization

Event or an Event of Default, the “CP Rate” for any Interest Accrual Period (or

portion thereof) shall be the Alternative Rate in effect from time to time.

 

“Deal Agent” means Barclays Bank PLC.

 

“Default Interest” is defined in Section

2.2(b) of this Supplement.

 

“Depreciation Percentage” has the meaning

set forth in Schedule 1 attached hereto.

 

“Determination Date” means the first

Business Day prior to any Payment Date.

 

“Developed Asia/Pacific Rim” has the meaning

set forth in Schedule 1 attached hereto.

 

“Developed Europe” has the meaning set forth

in Schedule 1 attached hereto.

 

“Dollars” and the sign “$” means lawful currency of

the United States of America.

 

“Early Amortization Event” is defined in

Section 7.1 of this Supplement.

 

“Effective Date” means the date on which

each of the conditions precedent set forth in Section 5.1 of this Supplement

shall have been duly fulfilled or satisfied.

 

“Eligible Engine” means any Engine that,

individually or when considered with all Eligible Engines then owned (either

directly or beneficially) by Issuer, as applicable, shall comply with each of

the following requirements, unless any of such requirements (with the exception

of requirement (7) is waived in writing by the Deal Agent:

 

(1)           Eligible

Lease.  Each Engine is subject to an

Eligible Lease on the related Transfer Date; provided that an Engine

shall not be required to be subject to an Eligible Lease on the related

Transfer Date so long as, after giving effect to the transfer of all Engines

which are transferred on any Transfer Date, the On-Lease Percentage of all

Eligible Engines as of such Transfer Date shall not be less than the Target

On-Lease Percentage;

 

(2)           On-Lease

Percentage.  The On-Lease Percentage

of all Eligible Engines as of the related Transfer Date shall be greater than

the Applicable Percentage;

 

(3)           Engine

Representations and Warranties. 

Each Engine complies with the Engine Representations and Warranties on

the related Transfer Date, including without limitation, that representation

and warranty of the Seller set forth in Section 3.01(o) of the Contribution and

Sale Agreement;

 

(4)           Casualty

Loss.  No Casualty Loss shall have

been suffered by the related Engine;

 

(5)           Depreciation

Policy.  The depreciation method

utilized in calculating the Net Book Value of such Engine as of such Transfer

Date is the Depreciation Policy;

 

7

 

(6)           Owner

Trust.  (a) Such Engine shall be

owned by and leased from an Owner Trustee on behalf of an Owner Trust created

by the Issuer pursuant to a Trust Agreement substantially in the form attached

hereto as Exhibit H-1, (b) such Owner Trustee shall have executed and

delivered to the Collateral Custodian a facsimile copy of an Owner Trustee

Guaranty substantially in the form attached hereto as Exhibit H-2 (the original

counterpart of which shall be delivered to the Collateral Custodian within ten

Business Days after such execution and delivery), (c) such Owner Trustee

shall have executed and delivered to FAA Counsel, and to the Collateral

Custodian a facsimile copy of, a Owner Trustee Mortgage substantially in the

form attached hereto as Exhibit H-3 (the original counterpart of which shall be

delivered to the Collateral Custodian within three (3) Business Days after

the filing thereof with the FAA), and (d) the Issuer shall have executed

and delivered to the Collateral Custodian a facsimile copy of a Beneficial Interest

Pledge Agreement substantially in the form attached hereto as Exhibit H-4 (the

original counterpart of which shall be delivered to the Collateral Custodian

within ten Business Days after such execution and delivery); and

 

(7)           Term

Securitization.  Following the

consummation of the Term Securitization, the Requisite Global Majority has

approved such Engine.

 

“Eligible Lease” means each Lease Agreement

that encumbers an Engine on any Transfer Date or any date thereafter that

complies with all of the following requirements unless any of such requirements

is waived in writing by the Deal Agent:

 

(1)           Delinquencies.  No Scheduled Payment on such Lease Agreement

is delinquent for more than 30 days as of the related Transfer Date;

 

(2)           Valid

Contract.  Each Lease Agreement is a

legal, valid and binding full recourse payment obligation of the related

Lessee, is enforceable in accordance with its terms (except as may be limited

by applicable insolvency, bankruptcy, moratorium, reorganization, or other

similar laws affecting enforceability of creditors’ rights generally and the

availability of equitable remedies) and is in full force and effect and such

Lease Agreement has not been satisfied, subordinated or rescinded;

 

(3)           Hell-or-High

Water Obligation.  The Lessee’s

obligations under each Lease Agreement are non-cancelable and unconditional and

not subject to any right of setoff, counterclaim, reduction or recoupment;

 

(4)           Reserved;

 

(5)           Net

Lease.  Each Lease Agreement

contains provisions requiring the related Lessee to pay all sales, use, excise,

rental, property or similar taxes imposed on or with respect to the Engine and

to assume all risk of loss or malfunction of the related Engine; each Lease

Agreement requires the Lessee to maintain the Engine in good and workable order

and as are necessary to maintain the Engine’s serviceability standards pursuant

to FAA requirements or requirements of other appropriate Governmental

Authorities;

 

(6)           Legal

Capacity.  The Lessee had the legal

capacity to execute such Lease Agreement and the Issuer, the Seller or the

Owner Trustee, as applicable, had the legal capacity to execute such Lease

Agreement or the related acquisition documentation, as the case may be;

 

8

 

(7)           U.S.

Dollars.  All payments under each

Lease Agreement are required to be made in Dollars;

 

(8)           No

Consent.  No Lease Agreement

requires the prior written consent of a Lessee or contains another restriction

relating to the transfer or assignment of such Lease Agreement by the Seller,

the Owner Trustee or the Issuer (except such consent as has been obtained or

restrictions satisfied on or prior to the related Transfer Date);

 

(9)           Scheduled

Payments.  Each Lease Agreement

provides for the payment of Scheduled Payments on a basis no less frequently

than quarterly;

 

(10)         Payment.  As of the Transfer Date, no Scheduled

Payment under any Lease Agreement has been prepaid; (it being understood that

scheduled rental payments to be paid in advance for each rent period in accordance

with the terms of the Lease Agreement are not prepayments).

 

(11)         Customary

Practices.  The Lease Agreement was

originated or acquired by the Seller or the Issuer, as the case may be, in the

ordinary course of its business;

 

(12)         Bankrupt

Lessee.  On the Transfer Date, the

related Engine is not subject to a Lease Agreement with a Lessee that is

subject to an Insolvency Proceeding;

 

(13)         Insurance.  The Lease Agreement requires the Lessee to

provide liability insurance, all risk ground and flight hull and engine

coverage for damage/loss of the Engine subject to such Lease, war risk, and

where requested by the Issuer and the Administrative Agent and where available

on a commercially reasonable basis, governmental confiscation and expropriation

insurance coverage with acceptable deductibles, each of which shall name, as

the case may be, the Indenture Trustee as first loss payee, and the Indenture

Trustee, the Administrative Agent, the Deal Agent and the Noteholders under the

Indenture, and their respective directors, officers, employees and agents as

additional insureds;

 

(14)         Geographic

Operating Restrictions.  In the

Lease Agreement the Lessee agrees not to operate the related Engine, and not to

be based, in any jurisdiction excluded from the insurance coverage referred to

in item (13) above and to comply with all applicable requirements of

Governmental Authorities relating to the installation, operation and

maintenance of such Engine; and

 

(15)         Chattel

Paper.  Any original counterpart of

each Lease Agreement (other than the one held by the Lessee or filed with any

relevant Governmental Authority) that constitutes “chattel paper” for purposes

of the UCC as in effect in the jurisdiction whose law governs the Lease

Agreement has been delivered to the Indenture Trustee.

 

“Emerging Asia” has the meaning set forth in

Schedule 1 attached hereto.

 

“Emerging Latin/South America” has the

meaning set forth in Schedule 1 attached hereto.

 

“Emerging Market” has the meaning set forth

in Schedule 1 attached hereto.

 

9

 

“Engine Transfer Certificate” has the

meaning set forth in the Contribution and Sale Agreement.

 

“Engine Type Excess Concentration Amount”

means at any date of determination, the dollar amount, if any, by which the sum

of the Net Book Values of all Eligible Engines (relating to Loans hereunder) of

the same engine type exceeds the applicable concentration limits set forth in

Section 5.2(o) hereof.

 

“Eurocurrency Liabilities” shall have the

meaning assigned to that term in Regulation D of the Board of Governors of the

Federal Reserve System, as in effect from time to time.

 

“Eurodollar Business Day” means any day that

is not a Saturday or Sunday or other day on which banking institutions in

London, England, are authorized or obligated by law, executive order or

government decree to remain closed or on which the London interbank market

generally is closed to transactions in Dollars.

 

“Eurodollar Office” shall mean such office

or offices through which the Deal Agent determines the Eurodollar Rate.  A Eurodollar Office of the Deal Agent may

be, at the option of the Deal Agent, either a domestic or foreign office.

 

“Eurodollar Rate” shall mean, with respect

to any Interest Accrual Period (or portion thereof), a per annum rate of

interest equal to the rate shown on page 3750 of the Bridge Telerate screen or

any successor page as the composite offered rate for London interbank deposits

for a period approximating such Interest Accrual Period (or portion thereof),

as shown under the heading “USD” as of 11:00 A.M. (London time) on the second

Business Day before (and for value on) the first day of such Interest Accrual

Period (or portion thereof).  In the

event no such rate appears, the Eurodollar Rate shall be, with respect to any

Interest Accrual Period, the per annum rate of interest at which Dollar

deposits in immediately available funds are offered to the Eurodollar Office of

the Deal Agent by prime banks in the interbank eurodollar market at or about

10:00 a.m., London time, on the second Eurodollar Business Day before (and for

value on) the first day of such Interest Accrual Period (or portion thereof)

and in an amount of not less than $1,000,000 for such Interest Accrual Period

(or portion thereof).

 

“Eurodollar Rate (Reserve Adjusted)” shall

mean, with respect to any Interest Accrual Period (or portion thereof), the per

annum rate of interest (rounded upward, if necessary, to the nearest whole

multiple of 1/100th of one percent per annum) determined by dividing (a) the Eurodollar

Rate for such Interest Accrual Period (or portion thereof) by (b) one minus the

Eurodollar Reserve Percentage (expressed as a decimal) applicable during such

Interest Accrual Period (or portion thereof).

 

“Eurodollar Rate Disruption Event” shall mean

any of the following:  (a) a

determination by Deal Agent that it would be contrary to law or to the

directive of any central bank or other Governmental Authority to obtain Dollars

in the London interbank market to fund or maintain an investment in the Series

2002-1 Notes for an Interest Accrual Period (or portion thereof) or (b) a

determination by Deal Agent that by reason of circumstances affecting the

London interbank market generally Dollars cannot be obtained in such market to

fund an investment in the Series 2002-1 Notes for an Interest Accrual Period

(or portion thereof).

 

10

 

“Eurodollar Reserve Percentage” shall mean,

with respect to any Interest Accrual Period (or portion thereof), the reserve

percentage (rounded upwards, if necessary, to the nearest 1/100th of one

percent per annum) applicable during such Interest Accrual Period (or portion

thereof) (or, if more than one such percentage shall be so applicable during

such Interest Accrual Period, the daily average of such percentages for those

days in such Interest Accrual Period (or portion thereof) during which any such

percentages shall be in effect) under regulations issued from time to time by

the Board of Governors of the Federal Reserve System (or any successor) for

determining the maximum reserve requirement (including, without limitation, any

emergency, supplemental or other marginal reserve requirement) for banks or

other financial institutions subject to such regulations with respect to liabilities

or assets consisting of or including Eurocurrency Liabilities having a term

equal to such Interest Accrual Period (or portion thereof).

 

“Evidence of Filing” has the meaning set

forth in the Contribution and Sale Agreement.

 

“Excess Concentration Amount” means, at any

date of determination, an amount equal to the highest of the Engine Type Excess

Concentration Amount, the Single Lessee Excess Concentration Amount, the Three

Lessee Excess Concentration Amount, the Geographic Region Excess Concentration

Amount and the Wide Body Aircraft Excess Concentration Amount.

 

“Existing and Possible Loans” means Loans

outstanding hereunder and Loans proposed to be made on any Transfer Date.

 

“FAA Counsel” shall mean McAfee & Taft

or such other reputable counsel with offices in Oklahoma City, OK as Issuer and

Servicer may from time to time select.

 

“Federal Funds Rate” means for any period, a

fluctuating interest rate per annum equal for each day during such period to

the weighted average of the federal funds rates and confirmed in Federal

Reserve Board Statistical Release H.15(519) or any successor or substitute

publication selected by Barclays Bank PLC (or, if such day is not a Business

Day, for the next preceding Business Day), or, if for any reason, such rate is

not available on any day, the rate determined, in the sole opinion of Barclays

Bank PLC, to be the rate at which federal funds are being offered for sale in

the national federal funds market at 9:00 a.m. (New York City time).

 

“Federal Reserve Board” means the Board of

Governors of the Federal Reserve System or any successor thereto.

 

“Final Payment Date” means, with respect to

Series 2002-1 Notes, the date which is the fourth anniversary of the Conversion

Date, or if such date is not a Business Day, the Business Day immediately

succeeding such date.

 

“Geographic Region Excess Concentration Amount”

means at any date of determination, the dollar amount, if any, by which the sum

of the Net Book Values of all Eligible Engines (relating to Loans hereunder) subject

to a Lease Agreement with Lessees having corporate headquarters located in the

geographic areas set forth in Section 5.2(r) hereof exceeds the applicable

concentration limits set forth in Section 5.2(r) hereof.

 

11

 

“Guarantor” means Willis Lease Finance

Corporation and its successors and permitted assigns.

 

“Guaranty” means the Guaranty dated as of

September 12, 2002 made by the Guarantor in favor of the Class B Note

Purchasers, as the same is amended, restated, supplemented and modified from

time to time.

 

“Increased Costs” shall have the meaning set

forth in the applicable Note Purchase Agreement.

 

“Indenture Compliance Certificate” means the

certificate of the Issuer given pursuant to Section 5.2(c) hereof.

 

“Interest” means for each Interest Accrual

Period and for each Loan outstanding, the sum of the products (for each such

day during such Interest Accrual Period) of

 

(S + IR) x P x 1/360

 

where:

 

	

  S

  	

   

  	

  =

  	

   

  	

  the Spread applicable to such Loan on such day; and

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

  IR

  	

   

  	

  =

  	

   

  	

  the Interest Rate applicable to such Loan on such

  day; and

  
	

   

  	

   

  	

   

  	

   

  	

   

  
	

  P

  	

   

  	

  =

  	

   

  	

  the principal balance of such Loan on such day.

  

 

provided,

however, that (i) no provision of this Supplement shall require the

payment or permit the collection of Interest in excess of the maximum permitted

by applicable law and (ii) Interest shall not be considered paid by any

distribution if such distribution is rescinded or must otherwise be returned

for any reason.

 

“Interest Accrual Period” means for any

Payment Date, the period beginning with and including the day next following

the end of the preceding Interest Accrual Period and ending on and including

the 15th day of the following month; except that, in the case of the first

Interest Accrual Period, the period beginning with and including the Effective

Date and ending on and including the 15th day of the month next following the

month in which the Effective Date occurs. 

If such period is associated with Alternative Rate fundings the Interest

Accrual Period shall be at the Deal Agent’s discretion; provided, however,

that such period shall end on no later than either the 15th day of the

following month or the 15th day of the second succeeding month.  When switching from Alternative Rate to CP

Rate or Alternate Base Rate funding, the first such Interest Accrual Period

shall be at the Deal Agent’s discretion.

 

“Interest Rate” means for any Loan on any

day:

 

(A)          so long as an Event of

Default shall not have occurred and be contining on such day:

 

12

 

(i)            with respect to a

Class A Note, a rate equal to the Sheffield Cost of Funds on such day, or

 

(ii)           with respect to a Class

B Note, a rate equal to the Alternative Rate on such day; or

 

(B)           if an Event of Default

has occurred and is continuing on such day, the applicable Overdue Rate.

 

“Issuer Fee Letter” means the Fee Letter,

dated as of September 12, 2002 between the Issuer and the Deal Agent.

 

“Lease Agreement” means any lease agreement

entered into from time to time by the Issuer or any Owner Trust, either

directly or pursuant to an assignment, pursuant to which the Issuer or any

Owner Trust leases one or more Engines, which lease agreement is identified on Schedule

2 hereto, and any additions, substitutions and replacements therefore made

in accordance with the Series 2002-1 Transaction Documents and reflected in an

amendment to such Schedule 2.

 

“Loan” means an extension of credit made by

a Purchaser pursuant to Section 2.4 hereof.

 

“Minimum Servicing Fee Percentage” has the

meaning set forth in Schedule 1 attached hereto.

 

“Note” means, with respect to Series 2002-1,

any Class A Note or Class B Note.

 

“Note Commitment” means either the Class A

Note Commitment or the Class B Note Commitment, as applicable.

 

“Note Purchase Agreement” means either the

Class A Note Purchase Agreement or the Class B Note Purchase Agreement, as

applicable.

 

“Noteholder(s)” means, at any time of

determination for the Series 2002-1 Notes, any person in whose name a Note is

registered in the Note Register.

 

“On-Lease Percentage” means, a fraction,

expressed as a percentage, the numerator of which is equal to the Net Book

Value of all Eligible Engines (relating to Loans hereunder) subject to a Lease

Agreement and the denominator of which is equal to the sum of the Net Book

Values of all Engines (relating to Loans hereunder).

 

“Overdue Rate” means on any day, the sum of:

 

(A)          (i)            with respect to a Class A Note, a rate

equal to the Sheffield Cost of Funds on such day, or

 

(ii)           with respect to a Class

B Note, a rate equal to the Alternative Rate on such day; and

 

13

 

(B)           2.00% per annum.

 

“Owner Trust” means, with respect to an

Engine, an owner trust that is established pursuant to a trust agreement substantially

in the form attached hereto as Exhibit H-1 solely to hold such Engine and

related Lease Agreement in connection with the Indenture.

 

“Owner Trust Documents” means with respect

to an Owner Trust, an executed Trust Agreement substantially in the form

attached hereto as Exhibit H-1, an executed Owner Trustee Guaranty

substantially in the form attached hereto as Exhibit H-2, an executed Owner

Trustee Mortgage substantially in the form attached hereto as Exhibit H-3, and

an executed Beneficial Interest Pledge Agreement substantially in the form

attached hereto as Exhibit H-4.

 

“Payment Date” means, with respect to the

Series 2002-1 Notes, the twentieth day of each month, or, if such day is not a

Business Day, the immediately following Business Day; provided, however,

that the initial Payment Date shall be the twentieth day of the second month

immediately succeeding the Closing Date, or if such day is not a Business Day,

the immediately following Business Day.

 

“Portfolio Report” shall have the meaning set

forth in Section 4.4(a) hereof.

 

“Prepayment” means any mandatory or optional

prepayment of principal of Notes including, without limitation, any Prepayment

pursuant to Section 702 of the Indenture.

 

“Principal Report” shall have the meaning

set forth in Section 4.4(b) hereof.

 

“Principal Report Date” means, with respect

to any Payment Date, the third Business Day prior to such Payment Date.

 

“Purchaser” shall mean the Class A Note

Purchaser or a Class B Note Purchaser, as applicable.

 

“Quarterly Utilization Rate” means, as of

the last day of any calendar month, the weighted average of the On-Lease

Percentages for such calendar month and the two calendar months immediately

preceding such calendar month.

 

“Record Date” means the third Business Day

prior to any Payment Date.

 

“Renewal Fee” has the meaning set forth in

the Issuer Fee Letter.

 

“Securities Accounts” means the Series

2002-1 Series Account, the Series 2002-1 Restricted Cash Account, the Series

2002-1 Engine Reserve Account and the Series 2002-1 Security Deposit Account.

 

“Securities Intermediary” means The Bank of

New York, a New York banking corporation, as securities intermediary (as such

term is defined under UCC Section 8-102(a)(14)) with respect to the Securities

Accounts.

 

14

 

“Senior Asset Base” means, as of any Payment

Date, an amount equal to (1) the sum of (a) the product of (i) 90%,

(ii) the Applicable Percentage and (iii) the sum of (x) the Aggregate

Net Book Value as of the end of the immediately preceding Collection Period of

all Eligible Engines pledged to Series 2002-1 and (y) an amount calculated as

of the end of the immediately preceding Collection Period by applying the

Depreciation Policy to Capital Improvements made to the Eligible Engines

pledged to Series 2002-1, and (b) the amount on deposit in the related

Restricted Cash Account for Series 2002-1 on such Payment Date, after giving

effect to all deposits to and withdrawals from such Restricted Cash Account on

such Payment Date, minus (2) the sum of (a) any Maintenance Reserve Payments

and Security Deposits relating to such Eligible Engines pledged to Series

2002-1 that are not then on deposit in the related Engine Reserve Account and

the related Security Deposit Account, respectively, and (b) the Excess

Concentration Amount.

 

“Senior Step-Up Program Fee” shall have the

meaning assigned to such term in the Issuer Fee Letter.

 

“Series Collateral” shall have the meaning

set forth in Section 2.1(e) hereof.

 

“Series 2002-1” shall mean the Series of

Notes the terms of which are specified in this Supplement.

 

“Series 2002-1 Engines” shall mean the

Engines identified on Schedule 2 hereto, and any additions,

substitutions and replacements therefore made in accordance with the Series

2002-1 Transaction Documents and reflected in an amendment to such Schedule

2.

 

“Series 2002-1 Engine Reserve Account” means

the subaccount established by the Issuer with the Indenture Trustee into which

Maintenance Reserve Payments are deposited pursuant to Section 308 of the

Indenture and Section 3.05 hereof.

 

“Series 2002-1 Note Principal Balance” means

as of any date of determination, the sum of the Class A Note Principal Balance

and the Class B Note Principal Balance.

 

“Series 2002-1 Noteholder” shall mean the

Person in whose name a Series 2002-1 Note is registered in the Note Register.

 

“Series 2002-1 Notes” means the Class A and

Class B Notes, and shall include any and all replacements, extensions,

substitutions or renewals of such notes.

 

“Series 2002-1 Restricted Cash Account”

means the subaccount (designated as such) of the account established pursuant

to Section 307 of the Indenture.

 

“Series 2002-1 Restricted Cash Amount” means

the amount required to be deposited or maintained in the Series 2002-1 Restricted

Cash Account, which on the date on which the initial Loan is made and on any

Payment Date thereafter shall be equal to the product of (x) two percent (2%)

and (y) the Series 2002-1 Note Principal Balance on such date on which the

initial Loan is made or on such Payment Date, as the case may be (after giving

effect to all Loans made on such date on which the initial Loan is made or on

such Payment Date and all Class A Note Minimum

 

15

 

Principal Payment Amounts and Class B Note Minimum Principal Payment

Amounts actually paid on such date on which the initial Loan is made or on such

Payment Date).

 

“Series 2002-1 Security Deposit Account”

means the subaccount established by the Issuer with the Indenture Trustee into

which Security Deposits are deposited pursuant to Section 309 of the Indenture

and Section 3.6 hereof.

 

“Series 2002-1 Series Account” means the

account established by the Issuer with the Indenture Trustee into which funds

are deposited from the Trust Account pursuant to Section 303 of the Indenture.

 

“Series 2002-1 Transaction Documents” means

any and all of the Indenture, this Supplement, the Series 2002-1 Notes, the

Servicing Agreement, the Contribution and Sale Agreement, the Class A Note Purchase

Agreement, the Class B Note Purchase Agreement, the Administration Agreement,

each Beneficial Interest Pledge Agreement, each Owner Trustee Guaranty, each

Owner Trustee Mortgage, each Trust Agreement and any and all other agreements,

documents and instruments executed and delivered by or on behalf or in support

of the Issuer with respect to the issuance and sale of the Series 2002-1 Notes,

as any of the foregoing may from time to time be amended, modified,

supplemented or renewed.

 

“Servicer Advance” means all extraordinary

out of pocket payments payable pursuant to Section 3.04 of the Servicing

Agreement and made by the Servicer which have been authorized by the Deal

Agent.

 

“Servicer Report” means, with respect to

Series 2002-1, the monthly report prepared by the Servicer in the form set

forth in Exhibit A to the Servicing Agreement.

 

“Servicing Fee” has the meaning set forth in

Schedule 1 attached hereto.

 

“Sheffield” means Sheffield Receivables

Corporation or any successor thereto.

 

“Sheffield Cost of Funds” means for any Loan

on any day, (a) to the extent that the Class A Note Purchaser funds such Loan

either directly or indirectly through the issuance of Commercial Paper Notes, a

rate equal to the CP Rate for such Interest Accrual Period (or any applicable

portion thereof) and (b) to the extent that the Class A Note Purchaser funds

such Loan other than by issuing Commercial Paper Notes, a rate equal to the

Alternative Rate for such day or such other rate as the Deal Agent and the

Issuer shall agree to in writing.

 

“Single Lessee Excess Concentration Amount”

means at any date of determination, the dollar amount, if any, by which the

aggregate of the sum of the Net Book Values of all Eligible Engines (relating

to Loans hereunder) that are subject to a Lease Agreement with any single

Lessee (including Affiliates thereof) exceeds the applicable concentration

limits set forth in Section 5.2(p) hereof.

 

“Single Lessee Percentage” has the meaning

set forth in Schedule 1 attached hereto.

 

16

 

“Spread” with respect to any Loan shall mean

the Program Fee Rate (as defined in the Issuer Fee Letter) applicable to such

Loan, or following the consummation of the Term Securitization, such other rate

as agreed to by the Issuer and the Purchasers in writing.

 

“Subordinate Asset Base” means the excess of

the Asset Base over the Class A Note Principal Balance.

 

“Subordinate Step-Up Program Fee” shall have

the meaning assigned to such term in the Issuer Fee Letter.

 

“Subsequent Lease Transaction” shall mean a

Lease Agreement for any Engine which is entered into after the Transfer Date

for such Engine.

 

“Target EBIT Ratio” has the meaning set

forth in Schedule 1 attached hereto.

 

“Target On-Lease Percentage” has the meaning

set forth in Schedule 1 attached hereto.

 

“Target One Year Lease Expiry Concentration Percentage”

has the meaning set forth in Schedule 1 attached hereto.

 

“Target Two Year Lease Expiry Concentration Percentage”

has the meaning set forth in Schedule 1 attached hereto.

 

“Taxes” means any present or future taxes,

levies, imposes, duties, charges, assessment or fees of any nature (including

interest, penalties and additions thereto) that are imposed by any government

or other taxing authority.

 

“Term Securitization” means a transaction

whereby a special-purpose entity that is an Affiliate of Willis Lease Finance

Corporation other than the Issuer issues notes, certificates, preferred shares

or beneficial interests secured by aircraft engines, lease agreements and other

related assets that include all or a portion of the Contributed Assets or

Beneficial Interests related thereto.

 

“Three Lessee Excess Concentration Amount”

means at any date of determination, the dollar amount, if any, by which the sum

of the Net Book Values of all Eligible Engines (relating to Loans hereunder)

that are subject to a Lease Agreement with the three (3) largest Lessees with

respect to aggregate Net Book Values (including Affiliates thereof) exceeds the

applicable concentration limits set forth in Section 5.2(q) hereof.

 

“Three Lessee Percentage” has the meaning

set forth in Schedule 1 attached hereto.

 

“Utilization Rate” means, as of any date of

determination, the percentage equivalent of a fraction, the numerator of which

is the aggregate Net Book Value of the Series 2002-1 Engines subject to Lease

Agreements as of such date and the denominator of which is the Aggregate Net

Book Value of the Series 2002-1 Engines.

 

“Warehouse Structuring Fee” shall have the

meaning assigned to such term in the Issuer Fee Letter.

 

17

 

“Weighted Average Lease Rate Percentage”

has the meaning set forth in Schedule 1 attached hereto.

 

“Wide Body Aircraft Excess Concentration Amount”

means, at any date of determination, the dollar amount, if any, by which the

sum of the Net Book Values of all Eligible Engines (relating to Loans

hereunder) designed to power Wide Body Aircraft exceeds the applicable

concentration limits set forth in Section 5.2(s) hereof.

 

“Wide Body Aircraft Percentage” has the

meaning set forth in Schedule 1 attached hereto.

 

Section 1.2            Calculation

Guidelines.

 

For purposes of calculating the Class A Note Interest

Payment, the Class A Note Principal Balance shall at all times be equal to the

sum of all Class A Loans then outstanding. 

For purposes of calculating the Class B Note Interest Payment, the Class

B Note Principal Balance shall at all times be equal to the sum of all Class B

Loans then outstanding.

 

ARTICLE

II

 

CREATION OF THE

SERIES 2002-1 NOTES

 

Section 2.1            Designation:

General Terms and Conditions.

 

(a)           There is

hereby created a Series of Notes to be issued in two Classes pursuant to the

Indenture and this Supplement to be known respectively as the “Willis Engine

Funding LLC Secured Notes, Series 2002-1, Class A and Class B”.  The Series 2002-1 Notes shall not be rated

by any Rating Agency.

 

(b)           The

Payment Date with respect to the Series 2002-1 Notes shall be the twentieth day

of each month, or, if such day is not a Business Day, the immediately following

Business Day.

 

(c)           The Class

A Notes and the Class B Notes shall be issued in definitive form substantially

in the forms of Exhibit A and Exhibit B hereto.

 

(d)           Payments

of principal and interest on the Series 2002-1 Notes shall be payable solely

from funds on deposit in the Series 2002-1 Series Account or from other funds

as set forth in this Series 2002-1 Supplement at the times and in the amounts

set forth in Article III of this Supplement.

 

(e)           In

furtherance of, and in addition to the property identified in, the Granting

Clause set forth in the Indenture, as it relates to this Supplement, the Issuer

hereby grants to the Indenture Trustee, for the benefit of the Series 2002-1

Noteholders, a security interest in all of Issuer’s right, title and interest

in and to (i) each of the Series 2002-1 Engines, (ii) the Lease

Agreements that encumber the Series 2002-1 Engines on the Closing Date or on

any date thereafter, (iii) the Series 2002-1 Series Account, the Series

2002-1 Engine Reserve Account, the Series 2002-1 Security Deposit Account and

the Series 2002-1 Restricted Cash Account and all

 

18

 

amounts and

Eligible Investments from time to time on deposit therein, (iv) each

Beneficial Interest in an Owner Trust that owns a Series 2002-1 Engine, and

(v) all income, payments and proceeds of the foregoing (all such property

identified in this Section 2.1(e), collectively, the “Series Collateral”).  Such Series Collateral (except as set forth

in Section 401(d) of the Indenture with respect to Excess Cash Available for

Distribution) shall not be available to pay any other Aggregate Outstanding

Obligations until all Outstanding Obligations under this Supplement have been

paid in full.

 

(f)            In the

event that any term or provision contained herein shall conflict with or be

inconsistent with any term or provision contained in the Indenture, the terms

and provisions of this Supplement shall govern.

 

Section 2.2            Interest Payments on the Series

2002-1 Notes.

 

(a)           Interest

on Series 2002-1 Notes.  Each Loan

shall bear interest on the outstanding principal amount thereof from the date

when made, continued or converted until paid in full at a rate per annum equal

to the sum of the applicable Spread and the applicable Interest Rate.  Such interest shall be payable on each

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

accordance with Section 302 of the Indenture and Section 3.2 of this Supplement.

 

(b)           Default

Interest.  If an Event of Default

has occurred and is continuing on any given day, the Issuer shall pay interest

(“Default Interest”) at a rate per annum equal to the Overdue Rate, for the

period during which such amounts shall remain unpaid.  Such interest shall be payable (i) on each Payment Date from

amounts on deposit in the Series 2002-1 Series Account in accordance with

Section 3.2 of this Supplement and (ii) as further provided Article VIII

of the Indenture.

 

(c)           Determination

of Interest.  The Administrative

Agent shall determine the Interest on any Class of Notes as provided herein and

pursuant to Section 2.06 of the applicable Note Purchase Agreement.

 

Section 2.3            Principal Payments

on the Series 2002-1 Notes.

 

Principal of the Series 2002-1 Notes shall be payable

on each Payment Date from amounts on deposit in the Series 2002-1 Series

Account (and on the Final Payment Date, from amounts on deposit in the Series

2002-1 Restricted Cash Account) in accordance with Section 3.2 of this

Supplement.  The unpaid principal amount

of the Series 2002-1 Notes shall be due and payable in full on the Final

Payment Date, together with all unpaid interest, fees, expenses, costs and

other amounts payable by the Issuer pursuant to the terms of the Indenture and

this Supplement.

 

Section 2.4            Amounts and Terms

of Series 2002-1 Noteholder Commitments; Fees Payable by Issuer.

 

(a)           Subject to the terms

and conditions of this Supplement and the Class A Note Purchase Agreement and

the Class B Note Purchase Agreement, the Class A Note Commitment

 

19

 

and the Class B

Note Commitment, respectively, shall be available to the Issuer on and after

the Closing Date until the Conversion Date.

 

(b)           Prior to

the Conversion Date, the Class A Notes and Class B Notes shall be revolving

notes with maximum aggregate principal amounts equal to their respective Note

Commitments, then in effect; provided, however, that at no time

shall the Class A Note Principal Balance exceed the Senior Asset Base for this

Series 2002-1 nor shall the Class B Note Principal Balance exceed the

Subordinate Asset Base for this Series 2002-1. 

The Deal Agent shall maintain a record of all Loans and repayments made

on the Class A Notes and the Class B Notes and absent manifest error such

records shall be conclusive.  On any

date requested by the Issuer, after the Issuer shall have satisfied all

applicable conditions precedent set forth in Article V hereof and in the Class

A Note Purchase Agreement and the Class B Note Purchase Agreement, each Purchaser

shall, at the Issuer’s request for a Loan as specified in a notice given to the

Deal Agent in accordance with the terms of the applicable Note Purchase

Agreement, make payment thereof (in proportion to its respective commitment) in

accordance with the terms of the applicable Note Purchase Agreement in an

amount specified in such notice, and in accordance with the written direction

of the Issuer by wire transfer in same day funds provided, that each

request for an advance of principal of the applicable Note shall, subject to

the applicable Note Commitment then in effect, be in minimum and multiple

aggregate amounts as set forth in Section 2.04(b) of the applicable Note

Purchase Agreement.  The Issuer shall

pay interest on the Class A Notes and the Class B Notes at the rates and in the

manner set forth in Section 2.2 hereof. 

The unpaid principal amount of the Notes and all unpaid interest accrued

thereon, together with any unpaid Senior Step-Up Program Fee, Subordinate

Step-Up Program Fee, Renewal Fee and all other fees, expenses, costs and other

sums chargeable to the Issuer incurred in connection therewith, shall be due

and payable on the Final Payment Date.

 

Each request for a Loan shall constitute a

reaffirmation by the Issuer that (1) no Event of Default or Early Amortization

Event has occurred and is continuing and (2) the representations and warranties

contained in the Series 2002-1 Transaction Documents are true, correct and

complete in all material respects to the same extent as though made on and as

of the date of the request, except to the extent such representations and

warranties specifically relate to an earlier date, in which event they shall be

true, correct and complete in all material respects as of such earlier date.

 

Notwithstanding any other provision of this Section

2.4(b), following the consummation of the Term Securitization, the Purchasers

shall not be obligated to fund Loans under this Series 2002-1 Supplement and

the Note Purchase Agreements until the Issuer and the Purchasers have agreed in

writing regarding the Spreads for such Loans.

 

(c)           The

Issuer may, on any Payment Date, repay all or any portion of the Class A Note

Principal Balance and Class B Note Principal Balance provided that the Issuer

gives written notice of such prepayment to the Deal Agent that number of days

before such Payment Date as may be mutually agreed by the Issuer and the Deal

Agent and in accordance with the terms of this Supplement and complies with all

other applicable requirements of the applicable Note Purchase Agreements, by

making a wire transfer to the Deal Agent; provided, however that

the Issuer may not make such repayment from funds in the Series 2002-1

Restricted Cash Account unless the Issuer is repaying all of the Class A Note

Principal Balance and all of the Class B

 

20

 

Note Principal

Balance.  Such repayment shall be

accompanied by instructions to apply such cash to the reduction of principal

and accrued Interest through the date of such payment.  If the Issuer does not notify each Purchaser

and the Deal Agent of any such principal reduction at least 30 days prior to

such principal reduction, the Issuer shall pay all costs related to the

reduction of outstanding principal, including Breakage Costs and all costs

associated with the outstanding Commercial Paper Notes related to such

principal reduction.  The Issuer

understands (i) that Commercial Paper Notes issued in connection with such

principal may not be prepaid, (ii) that the amount of cash proceeds

received by each Purchaser may not match the amount of maturing Commercial

Paper Notes on the desired repayment date and (iii) that each Purchaser

shall use its reasonable best efforts to minimize any such Breakage Costs.

(d)           The

Issuer may terminate or reduce the Class A Maximum Limit and the Class B

Maximum Limit pursuant to Section 2.05 of the Class A Note Purchase Agreement

and Class B Note Purchase Agreement, respectively.

 

(e)           The

Issuer shall pay on each quarterly Payment Date, beginning with the third

Payment Date, an Administrative Agent Fee to the Administrative Agent as set

forth in Schedule 1.

 

(f)            The

Issuer shall pay on the Closing Date a Warehouse Structuring Fee to the Deal

Agent and any other fees and expenses of the Deal Agent, each as set forth in

the Issuer Fee Letter.

 

(g)           The

Issuer shall pay on any applicable Payment Date the Renewal Fee to the Deal

Agent as set forth in the Issuer Fee Letter.

 

(h)           The

Issuer shall pay on any Payment Date on or after the Conversion Date the Senior

Step-Up Program Fee and the Subordinate Step-Up Program Fee to the Class A

Noteholders and the Class B Noteholders, respectively, as set forth in the

Issuer Fee Letter.

 

Section 2.5            Increased Cost;

Capital Adequacy; Taxes.

 

The provisions set forth in Sections 2.08, 2.09 and

2.10 of each of the Class A Note Purchase Agreement and Class B Note Purchase

Agreement are incorporated herein.

 

Section 2.6            Payments,

Computations, Etc.

 

(a)           Unless

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

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

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

in lawful money of the United States in immediately available funds.  Unless otherwise expressly provided

herein, all amounts to be paid to the Deal Agent or to any Noteholder, as

applicable, shall be paid in accordance with the terms hereof on the day when

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

dollar denominated account maintained by the Deal Agent or any Noteholder in

accordance with wire instructions given to the Indenture Trustee by the Deal

Agent or Noteholder.  All computations

of interest and other fees hereunder shall be made on the basis of a year of

360 days for the actual number of days (including the first but excluding the

last day) elapsed.

 

21

 

(b)           Whenever

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

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

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

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

 

(c)           If any

Loan requested by the Issuer and approved by a Purchaser and the Deal Agent

pursuant to Section 2.04(b) of the applicable Note Purchase Agreement is not,

for any reason whatsoever related to a default or nonperformance by the Issuer,

made or effectuated, as the case may be, on the date specified therefor, the

Issuer shall indemnify such Purchaser against any reasonable loss, cost or

expense incurred by such Purchaser, including, without limitation, any loss

(including loss of anticipated profits), cost or expense incurred by reason of

the liquidation or reemployment of deposits or other funds acquired by such

Purchaser to fund or maintain such Loan, as the case may be, during such

Interest Accrual Period.

 

ARTICLE

III

 

SERIES 2002-1

SERIES ACCOUNT AND ALLOCATION AND APPLICATION OF AMOUNTS THEREIN

 

Section 3.1            Series 2002-1

Series Account.

 

The Issuer shall establish on the Effective Date and

maintain, so long as any Series 2002-1 Note is Outstanding, an Eligible Account

with the Indenture Trustee which shall be designated as the Series 2002-1

Series Account, which account is hereby pledged to the Indenture Trustee for

the benefit of the Series 2002-1 Noteholders pursuant to the Indenture and this

Supplement.  All deposits of funds by or

for the benefit of the Series 2002-1 Noteholders from the Trust Account and the

Series 2002-1 Restricted Cash Account shall be accumulated in, and withdrawn

from, the Series 2002-1 Series Account in accordance with the provisions of the

Indenture and this Supplement.

 

Section 3.2            Distributions from

Series 2002-1 Series Account on each Payment Date.

 

On each Payment Date, the

Indenture Trustee shall, in accordance with the Servicer Report, distribute

funds then on deposit in the Series 2002-1 Series Account and any other

funds available for application to the Series 2002-1 Notes to the following

Persons and in the following order of priority:

 

I                                            If

an Early Amortization Event shall not then be continuing:

 

(A)          By wire transfer of

immediately available funds, to the Indenture Trustee, all Indenture Trustee’s

Fees, to the Collateral Custodian, all Collateral Custodian’s Fees, to any

Owner Trustee of an Owner Trust that owns a Series 2002-1 Engine, any fees and

expenses incurred in performing its duties under the applicable Trust

Agreement, in each case then due and payable for Series 2002-1 to the extent

not paid by the Servicer;

 

22

 

(B)           (i)            if the Indenture Trustee has received the

Servicer Report for the related Collection Period, to the Servicer by wire

transfer of immediately available funds, an amount equal to the sum of any

(x) Servicing Fee Arrearage and (y) Servicing Fee then due and

payable and (ii) to the Servicer by wire transfer of immediately available

funds, an amount equal to any outstanding Servicer Advance;

 

(C)           To the Administrative

Agent, any fees and expenses then payable to the Administrative Agent approved

by the Requisite Global Majority pursuant to Section 405(b) of the

Indenture;

 

(D)          To each Interest Rate

Hedge Provider, any payments owing under the related Interest Rate Hedge

Agreement other than termination payments;

 

(E)           To each Holder of a

Class A Note on the immediately preceding Record Date an amount equal to such

Holder’s pro

rata portion of first, any Class A Note Interest Arrearage, and

second, the Class A Note Interest Payment for such Payment Date;

 

(F)           To each Holder of a

Class B Note on the immediately preceding Record Date, an amount equal to

its pro

rata portion of first, any Class B Note Interest Arrearage, and

second, the Class B Note Interest Payment for such Payment Date;

 

(G)           To the Series 2002-1

Restricted Cash Account, an amount sufficient so that the total amount on

deposit therein is equal to the Series 2002-1 Restricted Cash Amount for such

Payment Date;

 

(H)          (i) To the Deal

Agent, an amount equal to the Renewal Fee, if applicable and (ii) to the

Administrative Agent an amount equal to the sum of (x) the Administrative Agent

Fee then due and payable and (y) any unpaid Administrative Agent Fee from all

prior Payment Dates;

 

(I)            On a pari passu basis,

(i) to each Holder of a Class A Note on the immediately preceding

Record Date, an amount equal to its pro rata portion of the Class A Note

Minimum Principal Payment Amount and (ii) to each Interest Rate Hedge

Provider any termination payments owing under the related Interest Rate Hedge

Agreement;

 

(J)            To each Holder of a

Class B Note on the immediately preceding Record Date, an amount equal to

its pro

rata portion of the Class B Note Minimum Principal Payment

Amount;

 

(K)          For any Payment Date on

or after the Conversion Date, to each Holder of a Class A Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the sum

of (x) the Senior Step-Up Program Fee then due and payable and

(y) any unpaid Senior Step-Up Program Fee from all prior Payment Dates, if

any;

 

23

 

(L)           For any Payment Date on

or after the Conversion Date, to each Holder of a Class B Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the sum

of (x) the Subordinate Step-Up Program Fee then due and payable and

(y) any unpaid Subordinate Step-Up Program Fee from all prior Payment

Dates, if any;

 

(M)         For any Payment Date on

or after the Conversion Date, to each Holder of a Class A Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the

Class A Note Distributable Amortization Amount;

 

(N)          For any Payment Date on

or after the Conversion Date, to each Holder of a Class B Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the

Class B Note Distributable Amortization Amount;

 

(O)          To each Holder of a

Class A Note on the immediately preceding Record Date, pro rata, an amount equal to

any Class A Increased Costs and amounts due pursuant to Sections 2.5 and

2.6 hereof, if any, then due and payable with respect to such Class A Note and

any other costs, expenses, taxes and indemnities payable by the Issuer pursuant

to the Class A Note Purchase Agreement;

 

(P)           To each Holder of a

Class B Note on the immediately preceding Record Date, pro rata, an amount equal to

any Class B Increased Costs and amounts due pursuant to Sections 2.5 and

2.6 hereof, if any, then due and payable with respect to such Class B Note and

any other costs, expenses, taxes and indemnities payable by the Issuer pursuant

to the Class B Note Purchase Agreement;

 

(Q)          To the Indenture Trustee

for distribution pursuant to Section 401(d) of the Indenture, as Excess

Cash Available for Distribution, to the extent that any Deficient Series is

Outstanding on such Payment Date; and

 

(R)           To the Issuer by wire

transfer of immediately available funds, any remaining amount on deposit in the

Series 2002-1 Series Account on such Payment Date.

 

Notwithstanding the

foregoing, the amounts set forth in clause (R) shall be payable only at such

times as no Deficient Series then exists.

 

II                                        If

an Early Amortization Event shall then be continuing:

 

(A)          By wire transfer of

immediately available funds, to the Indenture Trustee, all Indenture Trustee’s

Fees, to the Collateral Custodian, all Collateral Custodian’s Fees, to any

Owner Trustee of an Owner Trust that owns a Series 2002-1 Engine, any fees and

expenses incurred in performing its duties under the applicable Trust

Agreement, in each case then due and payable for Series 2002-1 to the extent

not paid by the Servicer;

 

(B)           (i)            If the Indenture Trustee has received the

Servicer Report for the related Collection Period, to the Servicer by wire

transfer of immediately available funds, an amount equal to the sum of any

(x) Servicer Fee Arrearage and (y) Servicer Fee

 

24

 

then due and payable and (ii) to the Servicer by

wire transfer of immediately available funds, an amount equal to any

outstanding Servicer Advance;

 

(C)           To the Administrative

Agent, any fees and expenses then payable to the Administrative Agent approved

by the Requisite Global Majority pursuant to Section 405(b) of the

Indenture;

 

(D)          To an Interest Rate Hedge

Provider, any payments owing under the related Interest Rate Hedge Agreement

other than termination payments;

 

(E)           To each Holder of a

Class A Note on the immediately preceding Record Date an amount equal to such

Holder’s pro

rata portion of first, any Class A Note Interest Arrearage, and

second, the Class A Note Interest Payment for such Payment Date;

 

(F)           To each Holder of a

Class B Note on the immediately preceding Record Date, an amount equal to

its pro

rata portion of first, any Class B Note Interest Arrearage, and

second, the Class B Note Interest Payment for such Payment Date;

 

(G)           To the Series 2002-1

Restricted Cash Account, an amount sufficient so that the total amount on

deposit therein is equal to the Series 2002-1 Restricted Cash Amount for such

Payment Date;

 

(H)          (i) To the Deal

Agent, an amount equal to the Renewal Fee, if applicable and (ii) to the

Administrative Agent an amount equal to the sum of (x) the Administrative Agent

Fee then due and payable and (y) any unpaid Administrative Agent Fee from all

prior Payment Dates;

 

(I)            For any Payment Date

on or after the Conversion Date, to each Holder of a Class A Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the sum

of (x) the Senior Step-Up Program Fee then due and payable and

(y) any unpaid Senior Step-Up Program Fee from all prior Payment Dates, if

any;

 

(J)            For any Payment Date

on or after the Conversion Date, to each Holder of a Class B Note on the

immediately preceding Record Date, an amount equal to its pro rata portion of the sum

of (x) the Subordinate Step-Up Program Fee then due and payable and

(y) any unpaid Subordinate Step-Up Program Fee from all prior Payment

Dates, if any;

 

(K)          On a pari passu basis,

(i) to each Holder of a Class A Note on the immediately preceding

Record Date, an amount equal to its pro rata portion of the Class A Note

Minimum Principal Payment Amount and (ii) to each Interest Rate Hedge

Provider any termination payments owing under the related Interest Rate Hedge

Agreement;

 

25

 

(L)           To each Holder of a

Class B Note on the immediately preceding Record Date, an amount equal to

its pro

rata portion of the Class B Note Minimum Principal Payment Amount;

 

(M)         To each Holder of a Class

A Note on the immediately preceding Record Date, pro rata, an amount equal to

any Class A Increased Costs and amounts due pursuant to Sections 2.5 and

2.6 hereof, if any, then due and payable with respect to such Class A Note and

any other costs, expenses, taxes and indemnities payable by the Issuer pursuant

to the Class A Note Purchase Agreement;

 

(N)          To each Holder of a

Class B Note on the immediately preceding Record Date, pro rata, an amount equal to

any Class B Increased Costs and amounts due pursuant to Sections 2.5 and

2.6 hereof, if any, then due and payable with respect to such Class B Note and

any other costs, expenses, taxes and indemnities payable by the Issuer pursuant

to the Class B Note Purchase Agreement;

 

(O)          To the Indenture Trustee

for distribution pursuant to Section 401(d) of the Indenture, as Excess

Cash Available for Distribution, to the extent that any Deficient Series is

Outstanding on such Payment Date; and

 

(P)           To the Issuer by wire

transfer of immediately available funds, any remaining amount on deposit in the

Series 2002-1 Series Account on such Payment Date.

 

Any amounts payable to a Noteholder shall be made by

wire transfer of immediately available funds to the account that such

Noteholder has designated to the Indenture Trustee in writing on or prior to

the Business Day immediately preceding the Payment Date.

 

Section 3.3            Allocation of

Excess Cash Available for Distribution.

 

On each Payment Date, the Indenture Trustee shall

distribute any Excess Cash Available for Distribution deposited into the Series

2002-1 Series Account in accordance with Section 401 of the Indenture in

payment of the amounts and in the order of priority set forth in Section 3.2(I)

or (II) hereof; as the case may be.

 

Section 3.4            Series 2002-1

Restricted Cash Account.

 

(a)           The

Issuer shall establish on the Effective Date and maintain so long as any Series

2002-1 Note is Outstanding an Eligible Account with the Indenture Trustee which

shall be designated as the Series 2002-1 Restricted Cash Account, which account

is hereby pledged to the Indenture Trustee pursuant to the Indenture and this

Supplement.  On the date on which the

initial Loan is made, the Issuer will deposit the Series 2002-1 Restricted Cash

Amount in the Series 2002-1 Restricted Cash Account from the proceeds of

issuance of the Series 2002-1 Notes and thereafter amounts shall be deposited

in the Series 2002-1 Restricted Cash Account in accordance with Section 3.2 of

this Supplement.  Any and all moneys

remitted by the Indenture Trustee to the Series 2002-1 Restricted Cash Account

shall be invested in Eligible Investments in accordance with the Indenture and

shall be distributed in accordance with this Section 3.4.

 

26

 

(b)           The

Indenture Trustee shall as promptly as practicable, in accordance with written

instructions from the Deal Agent delivered to the Indenture Trustee prior to

each Payment Date, make a draw on the Series 2002-1 Restricted Cash Account in

an amount equal to the extent by which amounts on deposit in the Series 2002-1

Series Account will be insufficient to pay those amounts payable pursuant to

Section 3.2(I)(E) and (F) or Section 3.2(II)(E) and (F), as the case may be, on

such Payment Date (after giving effect to any distributions to be made on such

Payment Date prior to the payment of such amounts) and the amount of any such

draw shall be deposited in the Series 2002-1 Series Account.

 

(c)           On each

Payment Date, the Indenture Trustee shall, in accordance with the Servicer

Report or pursuant to written instructions from the Deal Agent, deposit in the

Series 2002-1 Series Account the excess, if any, of (A) amounts then on deposit

in the Restricted Cash Account (after giving effect to any withdrawals

therefrom on such Payment Date) over (B) the Series 2002-1 Restricted Cash

Amount.  On the Final Payment Date, any

remaining funds in the Series 2002-1 Restricted Cash Account shall be deposited

in the Series 2002-1 Series Account and distributed in accordance with Section

3.2 of this Supplement.

 

Section 3.5            Series 2002-1

Engine Reserve Account.

 

(a)           The

Issuer shall establish on the Effective Date and maintain an Eligible Account

with the Indenture Trustee which shall be designated as the Series 2002-1

Engine Reserve Account, which account is hereby pledged to the Indenture

Trustee pursuant to the Indenture and this Supplement.  The Issuer, or Servicer on its behalf; shall

cause the Lessees to remit the Maintenance Reserve Payments to the Trust Account,

and the Servicer, pursuant to the Servicing Agreement, shall, by not later than

each Determination Date, specifically identify those Maintenance Reserve

Payments to a particular Eligible Engine and instruct the Indenture Trustee to

allocate all Maintenance Reserve Payments on deposit in the Trust Account which

relate to any Engine pledged as collateral for the Series 2002-1 Notes, to the

Series 2002-1 Engine Reserve Account.

 

(b)           The

Issuer shall maintain (or shall cause the Servicer to maintain) records that

will identify amounts on deposit in the Series 2002-1 Engine Reserve Account to

a specific Eligible Engine.  The

Servicer shall be entitled to withdraw funds from the Series 2002-1 Engine

Reserve Account for the payment of maintenance expenses with respect to the

related Eligible Engine, at the times and subject to the further conditions set

forth in the Servicing Agreement; provided, however, that the Servicer may not

make any such withdrawal in an amount greater than $1,000,000 unless the Deal

Agent determines (or is deemed to determine) that the use of proceeds of such

withdrawal complies with the Maintenance Reserve Withdrawal Conditions (as

defined below).

 

The Servicer shall give the Indenture Trustee and the

Deal Agent prior written notice of any such requested withdrawal in excess of

$1,000,000, accompanied by supporting documentation showing compliance with the

Maintenance Reserve Withdrawal Conditions. 

Such request shall be accompanied by a notice in the form of Exhibit

F to this Supplement, duly completed (a “Withdrawal Notice”).  The Indenture Trustee shall, upon receipt of

such notice of a requested withdrawal and supporting documentation, transmit

copies thereof by telecopy to the Deal Agent. 

If such notice and documentation are received by the Indenture Trustee

prior to

 

27

 

2:00 p.m. (New York time) on any Business Day, the Indenture

Trustee will telecopy the same to the Deal Agent at (212) 412-3266 on the same

Business Day.  In all other cases the

Indenture Trustee will telecopy such notice and documentation to the Deal Agent

at such telecopy number on the next Business Day following the Indenture

Trustee’s receipt thereof.  If the Deal

Agent determines that such supporting documentation does not show that such

drawing complies with the Maintenance Reserve Withdrawal Conditions or that it

has received insufficient supporting documentation to show such compliance, it

will so indicate by signing the applicable Withdrawal Notice in the space

provided, and sending such signed Withdrawal Notice to the Indenture Trustee

and the Servicer no later than 5:00 p.m. (New York time) on the second

Business Day after the day on which the Deal Agent received such telecopy from

the Indenture Trustee.  Such notice by

the Deal Agent, if given, will be sent to the Indenture Trustee by telecopy at

(212) 815-2493.  If the Indenture

Trustee does not receive such notice by 5:00 p.m. (New York time) on such

second Business Day at such telecopy number, the Deal Agent will be deemed to

have determined that such withdrawal complies with the Maintenance Reserve

Withdrawal Conditions.  If the Indenture

Trustee timely receives such Withdrawal Notice signed by the Deal Agent, it

will not permit the applicable withdrawal from the Series 2002-1 Engine Reserve

Account.  If the Indenture Trustee does

not timely receive such Withdrawal Notice signed by the Deal Agent, it will

permit the applicable withdrawal.

 

The “Maintenance Reserve Withdrawal Conditions”

applicable to any Withdrawal Notice are that

 

(i)            the amount requested

to be withdrawn must be no greater than the aggregate amount of the invoices

for work done on the applicable Eligible Engine, copies of which are delivered

as part of the supporting documentation for such Withdrawal Notice, and

 

(ii)           the amount requested to

be withdrawn must be no greater than the aggregate amount of all Maintenance

Reserve Payments on deposit in the Series  2002-1 Engine Reserve Account

which were shown as being allocated to the applicable Eligible Engine in the

most recently delivered Servicer Report.

 

Notwithstanding the foregoing, so long as a Servicer

Default is then in effect, the Servicer shall not be entitled to make any such

withdrawal (irrespective of the amount thereof) except upon presentation of

supporting documentation reasonably determined by the Deal Agent to comply with

the Maintenance Reserve Withdrawal Conditions and the terms of the applicable

Lease Agreement (which shall evidence its determination by written instrument

delivered to the Indenture Trustee).

 

Section 3.6            Series 2002-1

Security Deposit Account.

 

(a)           The

Issuer shall establish on the Effective Date and maintain an Eligible Account

with the Indenture Trustee which shall be designated as the Series 2002-1

Security Deposit Account, which account is hereby pledged to the Indenture

Trustee pursuant to the Indenture and this Supplement.  The Issuer, or Servicer on its behalf, shall

cause the Lessees to remit the Security Deposits to the Trust Account, and the

Servicer, pursuant to the Servicing Agreement, shall, by not later than each

Determination Date, specifically identify those Security Deposits to

 

28

 

a particular

Eligible Engine and instruct the Indenture Trustee to allocate all Security

Deposits on deposit in the Trust Account which relate to any Engine pledged as

collateral for the Series 2002-1 Notes, to the Series 2002-1 Security Deposit

Account.

 

(b)           The

Issuer shall maintain (or shall cause the Servicer to maintain) records that

will identify amounts on deposit in the Series 2002-1 Security Deposit Account

to a specific Eligible Engine.  The

Servicer shall be entitled to withdraw funds from the Series 2002-1 Security

Deposit Account for the refund to the Lessee of the Security Deposit with

respect to the related Eligible Engine, at the times and subject to the further

conditions set forth in the Servicing Agreement; provided, however,

that so long as a Servicer Default is then in effect, the Servicer shall not be

entitled to make such withdrawal except upon presentation of supporting

documentation reasonably determined by the Deal Agent to comply with the terms

of the applicable Lease Agreement (which shall evidence its determination by

written instrument delivered to the Indenture Trustee).

 

(c)           The Servicer

shall be entitled to withdraw any funds eligible for withdrawal pursuant to

Section 3.6(b) from the Series 2002-1 Security Deposit Account and transfer

them to the Series 2002-1 Collection Account to be applied (i) in respect of a

final Scheduled Payment due and owing by the related Lessee with respect to the

related Eligible Engine or (ii) otherwise upon a payment default by the related

Lessee pursuant to the applicable Lease, at the times and subject to the

further conditions set forth in the Servicing Agreement; provided, however,

that so long as a Servicer Default is then in effect, the Servicer shall not be

entitled to make such withdrawal except upon presentation of supporting

documentation reasonably determined by the Deal Agent to comply with the terms

of the applicable Lease Agreement (which shall evidence its determination by

written instrument delivered to the Indenture Trustee).

 

Section 3.7            Securities Accounts.

 

(a)           Notwithstanding

any other provision of this Supplement or the Indenture, with respect to each

of the Securities Accounts, the Securities Intermediary hereby agrees that it

will comply with entitlement orders (as such term is defined under the UCC)

originated by the Indenture Trustee without further consent by the Issuer.

 

(b)           Each of

the Issuer, the Securities Intermediary and the Indenture Trustee intends that

the provisions of Section 3.7(a) will give the Indenture Trustee “control” over

the Securities Accounts (as the term “control” is defined under the UCC),

without prejudice to any other provision of the UCC that also would be deemed

to give the Indenture Trustee such control.

 

ARTICLE

IV

 

ADDITIONAL COVENANTS

 

In addition to the covenants set forth in Article VI

of the Indenture, the Issuer hereby makes the following additional covenants

for the benefit of the Series 2002-1 Noteholders:

 

29

 

Section 4.1            Additional Series.

 

For so long as any Series 2002-1 Note is Outstanding,

the Issuer shall not issue any additional Series of Notes on or after the

Effective Date without (a) the prior written consent of the Control Party for

this Series 2002-1, (b) confirmation in writing that the Outstanding

obligations of each Series of Notes (calculated after giving effect to such

proposed issues) shall not exceed the Asset Base for such Series of Notes as

evidenced by the related Asset Base Certificate most recently received by the

Indenture Trustee (but not earlier than the preceding Payment Date) and (c)

confirmation in writing that no Early Amortization Event or Event of Default

has occurred and is then continuing, and as a result of the issuance of such

new Series no Early Amortization Event or Event of Default will exist.

 

Section

4.2            Reserved.

 

Section

4.3            Inspections.

 

The Issuer agrees that any Person designated in

writing by the Deal Agent may consult with the proper officials of the Issuer

(including, without limitation, officials of any Affiliate of the Issuer in

charge of servicing the Lease Agreements) at such times during normal business

hours and as often as the Deal Agent may reasonably request regarding the

information required to be furnished pursuant to the Servicing Agreement or

regarding the performance of its respective covenants and agreements contained

in any of this Supplement or any of the Related Documents to which it is a

party.

 

Section

4.4            Portfolio

Report; Principal Report.

 

(a)           The

Issuer shall (or shall cause the Servicer to) on each Determination Date

prepare and deliver to the Indenture Trustee, each Series Enhancer (if

applicable), each Rating Agency (if applicable) and the Administrative Agent a

monthly report substantially in the form attached hereto as Exhibit J-1 (the

“Portfolio Report”) detailing the status of each Lease including but not

limited to engine utilization, engine lease rates, engine purchases and

dispositions, current Lessees, any repossessions under any Lease and any

delinquencies under any Lease.

 

(b)           The

Issuer shall (or shall cause the Servicer to) on each Principal Report Date

prepare and deliver to the Administrative Agent a monthly report substantially

in the form attached hereto as Exhibit J-2 (the “Principal Report”) for the

related Payment Date listing the Class A Note Principal Balance and the Class B

Note Principal Balance that will be outstanding on such Payment Date after all

distributions of principal on such Payment Date.

 

Section 4.5            Interest Rate Hedge

Agreements.

 

(a)           The

Issuer shall enter into Interest Rate Hedge Agreements in order to protect the

Issuer, to the extent commercially practicable, from fluctuations in interest

rates which would increase the interest payments of the Issuer on Notes issued

under this Supplement; provided that Interest Rate Hedge Agreements

shall be maintained in at least the amount specified in Schedule 1 and in form

and substance acceptable to the Deal Agent and be with an Interest Rate Hedge

Provider acceptable to the Deal Agent; provided, however, that

following any Servicer Default

 

30

 

the Deal Agent

shall have the right, in its sole discretion but after consultation with the

initial Servicer if the initial Servicer is still an operating entity, to

direct the Indenture Trustee to enter into Interest Rate Hedge Agreements on

the Issuer’s or the Indenture Trustee’s behalf on or prior to the effective

date of each such Interest Rate Hedge Agreement which is not solely a cap

agreement, the Interest Rate Hedge Providers thereunder shall agree, for the

period of one year after all Indebtedness under this Supplement shall have been

paid in full, not to commence any case, proceeding or other action under any

existing or future Insolvency Law seeking to have an order for relief entered

with respect to the Issuer.  In addition,

long term senior unsecured indebtedness of the related Interest Rate Hedge

Provider shall be rated not less than “A” by Standard & Poor’s and “A2” by

Moody’s.

 

(b)           Each

Interest Rate Hedge Agreement shall provide that all payments made pursuant

thereto shall be paid directly to the Series 2002-1 Series Account or shall be

assigned to the Issuer with directions from the Issuer to deposit such payments

in the Series 2002-1 Series Account, and all payments received from an Interest

Rate Hedge Provider shall be deposited by the Issuer or the Indenture Trustee

directly into the Series 2002-1 Series Account.

 

Section 4.6            Insurance.

 

Within 45 days of the Closing Date or the Transfer

Date related to the transfer of any additional Engine and related Lease

Agreement, in the case of any Engine and related Lease Agreement received from

an Affiliate of the Issuer, and on or before such Closing Date or Transfer

Date, in the case of all other Engines and related Lease Agreements, and on the

date of the applicable Subsequent Lease Transaction, the Issuer shall deliver

to the Collateral Custodian certificates evidencing the applicable Lessee’s

insurance coverage (in addition to any insurance coverage required under the

Servicing Agreement), which shall be satisfactory to the Deal Agent, and shall

name the Indenture Trustee on behalf of the Series 2002-1 Noteholders as

contract party or additional loss payee, as the case may be, in the case of

casualty insurance, and as additional insured in the case of liability

insurance.

 

Section 4.7            Lessee

Acknowledgment.

 

Within 90 days of the Closing Date or the Transfer

Date with respect to any Engine, the Lessee under the Lease Agreement relating

to such Engine, if any, shall have executed and delivered to the Deal Agent a

written agreement, substantially in the form attached hereto as Exhibit D.

 

Section 4.8            Opinions of Foreign

Local Counsel.

 

Within 120 days of the Closing Date or the Transfer

Date related to each Engine and related Lease Agreement, as the case may be,

the Issuer shall cause the delivery to the Series 2002-1 Noteholders of such

Opinions of Counsel as may be requested by the Deal Agent, other than counsel

employed by the Issuer, the Seller or the Servicer for purposes other than

solely with respect to the issuance of such opinions, in form and substance

satisfactory to the Series 2002-1 Noteholders, as to the perfection and

priority (to the extent applicable in such jurisdiction) of the Indenture

Trustee’s security interest in each Engine and related Lease

 

31

 

Agreement, which are subject to the applicable laws of any jurisdiction

other than the United States.

 

Section 4.9            Filing

of Leases with FAA.

 

The Issuer will

cause each Lease to be duly filed with the FAA, together with any Lease

assignment which may be necessary to perfect the Indenture Trustee’s security

interest in such Lease, no later than the Transfer Date of the

applicable Engine and, in the case of any Lease executed

and delivered after such Transfer Date, no later than the date of such execution

and delivery, and will deliver, or will cause to be delivered, evidence of such

filing together with any “chattel paper” original of such Lease to the

Collateral Custodian within three Business Days of such filing.

 

ARTICLE

V

 

CONDITIONS OF

EFFECTIVENESS AND FUTURE LENDING

 

Section 5.1            Effectiveness of

Supplement.

 

The effectiveness of this Supplement is subject to the

condition precedent that the Indenture Trustee shall have received all of the

following, each duly executed and dated as of the Effective Date, in form and

substance satisfactory to all of the initial Series 2002-1 Noteholders and each

(except for the Series 2002-1 Notes, of which only the originals shall be

signed) in sufficient number of signed counterparts to provide one for each

Series 2002-1 Noteholder:

 

(a)           Series

2002-1 Notes:  Separate Series

2002-1 Notes executed by the Issuer, and duly authenticated by the Indenture

Trustee, in favor of each Series 2002-1 Noteholder in the stated principal

amount of such Series 2002-1 Notes that such Series 2002-1 Noteholder has

agreed to purchase.

 

(b)           Certificate(s)

of Secretary or Assistant Secretary. 

Separate certificates executed by the corporate secretary or assistant

secretary of each of Willis Lease Finance Corporation (in its capacities as the

Seller, the Servicer and the Guarantor) and the Issuer, dated the Effective

Date, certifying (i) that the respective company has the authority to execute

and deliver, and perform its respective obligations under each of the Series

2002-1 Transaction Documents to which it is a party, and (ii) that attached are

true, correct and complete copies of the Certificate of Incorporation, by-laws,

board resolutions and incumbency certificates (in the case of Willis Lease

Finance Corporation) or Certificate of Formation, Limited Liability Company

Agreement and incumbency certificates (in the case of the Issuer) in form and

substance satisfactory to all of the initial Series 2002-1 Noteholders, as to

such matters as they shall require.

 

(c)           Security

Documents.  The Indenture and this

Supplement, in form and substance satisfactory to all of the initial Series

2002-1 Noteholders, shall have been executed and delivered by Issuer, and all

other parties thereto, together with other documents reasonably requested by Series

2002-1 Noteholders.

 

32

 

(d)           Opinions

of Counsel.  Opinions of Counsel to

the Issuer, the Seller, the Guarantor, the Servicer and the Indenture Trustee,

in form and in substance satisfactory to the initial Series 2002-1 Noteholders

as to such matters as it shall require.

 

(e)           Series

2002-1 Transaction Documents.  Each

of the Servicing Agreement, the Contribution and Sale Agreement, the

Administration Agreement, the Indenture, the Class A Note Purchase Agreement,

the Class B Note Purchase Agreement, this Supplement and the Issuer Fee Letter

shall have been duly executed and delivered.

 

(f)            Good

Standing Certificates.  Good

Standing Certificates in the state(s) of formation and location for each of the

Seller (as Seller and Servicer), the Guarantor and the Issuer.

 

(g)           Establishment

of Accounts.  Each of the Trust

Account, the Series 2002-1 Series Account, the Restricted Cash Account, the

Series 2002-1 Restricted Cash Account, the Engine Reserve Account, the Series

2002-1 Engine Reserve Account, the Security Deposit Account and the Series

2002-1 Security Deposit Account shall have been established with the Indenture

Trustee as evidenced by a certificate of an authorized officer of the Indenture

Trustee.

 

(h)           Guaranty.  The Guarantor shall have duly executed and

delivered the Guaranty.

 

(i)            Legal

Fees.  The Issuer shall have paid to

Sidley Austin Brown & Wood llp

its fees and expenses as counsel for the Deal Agent and the Purchasers.

 

Purchase of the Series 2002-1 Notes by the Series

2002-1 Noteholders shall be conclusive evidence, upon which the Indenture

Trustee may rely that the Series 2002-1 Noteholders have determined that the

conditions precedent to the effectiveness of the Series 2002-1 Supplement set

forth in (a) through (i) above, have been complied with to their satisfaction.

 

Section 5.2            Advances on Notes.

 

The obligation of a Purchaser to make any Loans

pursuant to the applicable Note Commitment under this Supplement and the

applicable Note Purchase Agreement is subject to the following further

conditions precedent; provided, however, that the Deal Agent may waive in

writing those conditions set forth in subdivisions (o), (r), (s), (v) and (w)

of this Section 5.2:

 

(a)           Default.  Before and after giving effect to such

advance, no Event of Default shall have occurred and be continuing.

 

(b)           Early

Amortization Event.  Before and

after giving effect to such advance, no Early Amortization Event shall have

occurred and be continuing, unless each of the Requisite Global Majority and

Holders representing one hundred percent (100%) of the Aggregate Note Principal

Balance have approved such advance.

 

(c)           Certification.  Issuer shall have delivered to the

Collateral Custodian, Deal Agent and Sheffield a compliance certificate, signed

by an officer of Issuer, as to the matters set out in Article V and in Article

VI of this Supplement.

 

33

 

(d)           Asset

Base Certificate.  Issuer shall have

delivered to the Collateral Custodian, Deal Agent and Sheffield a duly

completed and executed Asset Base Certificate, as of each Determination Date

and one (1) day preceding an Incremental Funding (as defined in applicable Note

Purchase Agreement), that states that (i) the Class A Note Principal Balance

(after giving effect to such proposed advance of principal of the Class A Note,

if applicable) will not exceed the Senior Asset Base for Series 2002-1 and (ii)

the Class B Note Principal Balance (after giving effect to such proposed

advance of principal of the Notes, if applicable) will not exceed the

Subordinate Asset Base for Series 2002-1 and complies with the requirements

therefor set forth in the Indenture and this Supplement.

 

(e)           Conversion

Date.  The Conversion Date shall not

have occurred.

 

(f)            Security

Documents.  All UCC financing

statements and documents of similar import in other jurisdictions, including

the documents required to be filed pursuant to the Contribution and Sale

Agreement, and other documents reasonably requested by Series 2002-1

Noteholders shall have been filed with the applicable Governmental Authorities,

and all Evidence of Filing delivered by the Seller to the Issuer on such

Transfer Date pursuant to Section 2.03(c) of the Contribution and Sale

Agreement shall have been delivered to the Deal Agent and the Collateral

Custodian.

 

(g)           Certificate

as to Engines.  A certificate from

the Servicer certifying that it is managing all of the Contributed Engines in

accordance with the Servicing Agreement shall have been delivered to the

Collateral Custodian.

 

(h)           Opinions

of Counsel.  The Collateral

Custodian shall have received Opinions of Counsel to the Issuer, other than

counsel employed by the Issuer, the Seller or the Servicer, as to the filing

with the FAA of the Indenture Trustee’s security interest in the Collateral,

and the perfection and priority of such security interest with respect to FAA

matters in form and substance satisfactory to the Series 2002-1 Noteholders.

 

(i)            Perfected

Security Interest.  The Collateral Custodian

and the Deal Agent shall have received evidence satisfactory to the Deal Agent

that the Indenture Trustee has (or upon funding, will have) a perfected, first

priority security interest in each Engine and related Lease Agreements that

will be the subject of such Loan; provided, however, that if the

applicable laws of any jurisdiction in which an Engine is required to be

registered does not provide for a means to obtain such a perfected, first

priority security interest, then the Issuer shall provide additional assurances

satisfactory to the Purchasers.

 

(j)            Appraisal.  The Collateral Custodian and the Deal Agent

shall have received an Appraisal in form, scope and for a value satisfactory to

the Deal Agent with respect to each Engine that will be the subject of such

Loan.

 

(k)           Chattel

Paper.  Any original counterpart of

each Lease Agreement (other than the one held by the Lessee or filed with any

relevant Governmental Authority) that will be the subject of a Loan that

constitutes “chattel paper” for purposes of the UCC as in effect in the

jurisdiction whose law governs the Lease Agreement has been delivered in escrow

to the Issuer’s FAA Counsel on or prior to the effectiveness of such Lease

Agreement, and shall have been filed

 

34

 

with the FAA on or

before the date of such Loan, provided, however, that FAA Counsel shall deliver

such “chattel paper” original counterpart to the Collateral Custodian within

three (3) Business Days after such filing.

 

(l)            Remittance

to Trust Account.  The Lessee under

each Lease Agreement that will be the subject of a Loan shall have been

directed to remit to the Trust Account all Scheduled Payments and other amounts

owing pursuant to such Lease Agreement.

 

(m)          Lessee

Acknowledgment.  The Lessee under

the Lease Agreement relating to an Engine, if any, shall have received a

written agreement for Lessee’s signature, substantially in the form attached

hereto as Exhibit D.

 

(n)           Reserved.

 

(o)           Maximum

Concentration by Engine Types.  Each

Engine shall have been manufactured by one of the manufacturers set forth under

the column titled “Manufacturer” on Exhibit C hereto and shall be one of

the engine types set forth opposite the name of such manufacturer under the

column titled “Engine Type” on Exhibit C hereto.  After giving effect to the transfer of

Engines on any Transfer Date, the sum of the Net Book Values of all Eligible

Engines (relating to Existing and Possible Loans) of the same engine type shall

not exceed an amount equal to the product of (i) the percentage set forth

opposite such engine type in the column entitled “Maximum Concentration” on Exhibit

C hereto and (ii) the Aggregate Net Book Value (relating to Existing and

Possible Loans) on such Transfer Date.

 

(p)           Maximum

Concentration for Single Lessee. 

After giving effect to the transfer of Engines and the related Lease

Agreements on any Transfer Date, the sum of the Net Book Values of all Eligible

Engines (relating to Existing and Possible Loans) that are or would be subject

to a Lease Agreement with a single Lessee (including Affiliates thereof) shall

not exceed an amount equal to the product of (i) the Single Lessee Percentage

and (ii) the Aggregate Net Book Value (relating to Existing and Possible

Loans).

 

(q)           Maximum

Concentration for any Three Lessees. 

After giving effect to the transfer of Engines and the related Lease

Agreements on any Transfer Date, the sum of the Net Book Values of all Eligible

Engines (relating to Existing and Possible Loans) that are or would be subject

to a Lease Agreement with the three (3) largest Lessees with respect to

aggregate Net Book Values (including Affiliates thereof) shall not exceed an

amount equal to the product of (i) the Three Lessee Percentage and (ii)

the Aggregate Net Book Value (relating to Existing and Possible Loans).

 

(r)            Maximum

Concentration by Geographic Region. 

After giving effect to the transfer of Engines and the related Lease

Agreements on any Transfer Date, the sum of the Net Book Values of all Engines

(relating to Existing and Possible Loans) that are or would be subject to a

Lease Agreement with Lessees having corporate headquarters located in the

geographic regions set forth in Schedule 1 shall not exceed an amount equal to

the product of (i) the percentage set forth opposite such geographic region

under the column entitled “Maximum Geographic Percentage” in the Geographic

Concentration Table in Schedule 1 and (ii) the Aggregate Net Book Value

(relating to Existing and Possible Loans).

 

35

 

(s)           Concentration

of Engines for Wide Body Aircraft. 

After giving effect to the transfer of all Engines which are transferred

on any Transfer Date, the sum of the Net Book Values of all Eligible Engines

designed to power Wide Body Aircraft shall not exceed an amount equal to the

product (A) the Wide Body Aircraft Percentage and (B) the Aggregate

Net Book Value.

 

(t)            On-Lease

Percentage.  After giving effect to

the transfer of Engines on any Transfer Date, the On-Lease Percentage of all

Eligible Engines (relating to Existing and Possible Loans) as of such Transfer

Date shall not be less than the Applicable Percentage.

 

(u)           Weighted

Average Lease Rate Factor.  After

giving effect to the transfer of Engines on any Transfer Date, the Weighted

Average Lease Rate Factor for all Eligible Engines (relating to Existing and

Possible Loans) shall not be less than the Weighted Average Lease Rate

Percentage.

 

(v)           One

Year Lease Expiry Concentration Percentage.  After giving effect to the transfer of Engines on any Transfer

Date, the One Year Lease Expiry Concentration Percentage for Eligible Engines

(relating to Existing and Possible Loans) on such Transfer Date shall not

exceed the Target One Year Lease Expiry Concentration Percentage.

 

(w)          Two Year

Lease Expiry Concentration Percentage. 

After giving effect to the transfer of Engines on any Transfer Date, the

Two Year Lease Expiry Concentration Percentage for Eligible Engines (relating

to Existing and Possible Loans) on such Transfer Date shall not exceed the

Target Two Year Lease Expiry Concentration Percentage.

 

(x)            Reserved.

 

(y)           Reserved.

 

(z)            Cargo-only

Carriers.  After giving effect to

the transfer of Engines on any Transfer Date, the percentage of Engines leased

to cargo-only carriers shall not exceed 15% of all Eligible Engines.

 

(aa)         Owner

Trustee Documents.  With respect to

each Engine owned by an Owner Trustee, the Collateral Custodian shall have

received from such Owner Trustee within three (3) Business Days of

the transfer of such Engine to such Owner Trustee (i) a copy of the

resolutions of the Board of Directors of the Owner Trustee, in its individual

capacity, certified by the Secretary or an Assistant Secretary of the Owner

Trustee, duly authorizing the execution, delivery and performance by the Owner

Trustee of each of the Related Documents to which the Owner Trustee is or will

be a party; (ii) an incumbency certificate of Owner Trustee, as to the

persons authorized to execute and deliver the Related Documents to which it is

or will be a party and the signatures of such person or persons; and

(iii) a legal opinion of counsel to the Owner Trustee with respect to the

due authorization, execution and delivery by the Owner Trustee of the Related

Documents to which it is or will be a party.

 

(bb)         Collateral

Custody Agreement.  The Issuer, the

Servicer, the Indenture Trustee and the Deal Agent shall have entered into a

Collateral Custody Agreement in form and substance satisfactory to the Deal

Agent with the Collateral Custodian and, on or before the date

 

36

 

of the applicable

Loan, the Collateral Custodian shall have confirmed to the Deal Agent in

writing that the Collateral Custodian has received the documents required by

Schedule I (attached hereto as Exhibit G) of such Collateral

Custody Agreement to be delivered on or before the date of such applicable

Loan.

 

Section 5.3            Deliveries.  The Issuer will timely file and deliver each

document which is required to be filed or delivered hereunder or under any

Related Document, or the filing or delivery of which is listed as a condition

to the making of any Loan in Section 5.2 but which is permitted to be

filed or delivered after the date of such Loan, strictly within the time period

set forth herein for such filing or delivery.

 

ARTICLE

VI

 

REPRESENTATIONS

AND WARRANTIES

 

To induce the Series 2002-1 Noteholders to purchase

the Series 2002-1 Notes hereunder, the Issuer hereby represents and warrants to

the Series 2002-1 Noteholders as of the Effective Date, the Closing Date and

each date on which a Loan is made (to the extent applicable to the Issuer

generally and to the assets added to the Collateral on such date on which a

Loan is made, unless otherwise specified) that:

 

Section 6.1            Existence.

 

Issuer is a limited liability company duly organized,

validly existing and in compliance under the laws of the State of

Delaware.  Issuer is in good standing

and is duly qualified to do business in each jurisdiction where the failure to

do so would have a material adverse effect upon the Issuer.

 

Section 6.2            Authorization.

 

Issuer has the power and is duly authorized to execute

and deliver this Supplement and the other Series 2002-1 Transaction Documents

to which it is a party, Issuer is and will continue to be duly authorized to

borrow monies hereunder, and Issuer is and will continue to be authorized to

perform its obligations under this Supplement and under the other Series 2002-1

Transaction Documents.  The execution, delivery

and performance by Issuer of this Supplement and the other Series 2002-1

Transaction Documents to which it is a party and the borrowings hereunder do

not and will not require any consent or approval of any Governmental Authority,

stockholder or any other Person which has not already been obtained.

 

Section 6.3            No Conflict; Legal

Compliance.

 

The execution, delivery and performance of this

Supplement and each of the other Series 2002-1 Transaction Documents and the

execution, delivery and payment of the Series 2002-1 Notes will not: (a) contravene

any provision of Issuer’s charter documents or bylaws or other organizational

documents; (b) contravene, conflict with or violate any applicable law or

regulation, or any order, writ, judgment, injunction, decree, determination or

award of any Governmental Authority; or (c) materially violate or result in the

breach of; or constitute a default under any indenture or other loan or credit

agreement, or other agreement or instrument

 

37

 

to which Issuer is a party or by which Issuer, or its property and

assets may be bound or affected.  Issuer

is not in material violation or breach of or default under any law, rule,

regulation, order, writ, judgment, injunction, decree, determination or award

or any contract, agreement, lease, license, indenture or other instrument to

which it is a party.

 

Section 6.4            Validity and

Binding Effect.

 

This Supplement is, and each Series 2002-1 Transaction

Document to which Issuer is a party, when duly executed and delivered, will be,

legal, valid and binding obligations of Issuer, enforceable against Issuer in

accordance with their respective terms, except as enforceability may be limited

by bankruptcy, insolvency or other similar laws of general application

affecting the enforcement of creditors’ rights or by general principles of

equity limiting the availability of equitable remedies.

 

Section 6.5            Financial

Statements.

 

Since December 30, 2001, there has been no Material

Adverse Change in the financial condition of the Seller or the Servicer.

 

Section 6.6            Executive Offices.

 

The current location of Issuer’s chief executive

office and principal place of business is located at 2320 Marinship Way, Suite

200, Sausalito, California 94965.  The

Issuer does not have trade names or doing business names.

 

Section 6.7            No Agreements or

Contracts.

 

The Issuer has not transacted any business on or prior

to the Effective Date.  The Issuer is

not now and has not been a party to any contract or agreement (whether written

or oral), other than the Series 2002-1 Transaction Documents and contracts or

agreements incidental thereto, including contracts or agreement for the sale of

any Contributed Assets or any Beneficial Interests, provided that such sale is

permitted by the Indenture. 

Notwithstanding the foregoing sentence, the Issuer may enter into any

agreement(s) for disposition of any Contributed Assets or a Beneficial Interest

in an Owner Trust which owns a Contributed Engine so long as such disposition

is permitted by Sections 606(a), 612, 804 or 816 of the Indenture.

 

Section 6.8            Consents and

Approvals.

 

No approval, authorization or consent of any trustee

or holder of any Indebtedness or obligation of Issuer or of any other Person

under any material agreement, contract, lease or license or similar document or

instrument to which Issuer is a party or by which Issuer is bound, is required

to be obtained by Issuer in order to make or consummate the transactions

contemplated under the Series 2002-1 Transaction Documents.  All consents and approvals of, filings and

registrations with, and other actions in respect of, all Governmental

Authorities required to be obtained by Issuer in order to make or consummate

the transactions contemplated under the Series 2002-1 Transaction Documents

have been, or prior to the time when required will have been, obtained, given,

filed or taken and are or will be in full force and effect.

 

38

 

Section 6.9            Margin Regulations.

 

Issuer does not own any “margin security”, as that

term is defined in Regulations G and U of the Federal Reserve Board, and the

proceeds of the Series 2002-1 Notes issued under this Supplement will be used

only for the purposes contemplated hereunder. 

None of such proceeds will be used, directly or indirectly, for the

purpose of purchasing or carrying any margin security, for the purpose of

reducing or retiring any indebtedness which was originally incurred to purchase

or carry any margin security or for any other purpose which might cause any of the

loans under this Supplement to be considered a “purpose credit” within the

meaning of Regulations T, U and X. 

Issuer will not take or permit any agent acting on its behalf to take

any action which might cause this Supplement or any document or instrument

delivered pursuant hereto to violate any regulation of the Federal Reserve

Board.

 

Section 6.10         Taxes.

 

All federal, state, local and foreign tax returns,

reports and statements required to be filed by Issuer have been filed with the

appropriate Governmental Authorities, and all Taxes and other impositions shown

thereon to be due and payable by Issuer have been paid prior to the date on

which any fine, penalty, interest or late charge may be added thereto for

nonpayment thereof, or any such fine, penalty, interest, late charge or loss

has been paid, or Issuer is contesting its liability therefore in good faith

and has fully reserved all such amounts according to GAAP in the financial

statements provided to the Noteholders pursuant to Section 626 of the Indenture.  Issuer has paid when due and payable all

material charges upon the books of Issuer and no Government Authority has

asserted any Lien against Issuer with respect to unpaid Taxes.  Proper and accurate amounts have been

withheld by Issuer and its Subsidiaries from its employees for all periods in

full and complete compliance with the tax, social security and unemployment

withholding provisions of applicable federal, state, local and foreign law and

such withholdings have been timely paid to the respective Governmental

Authorities.

 

Section 6.11         Other Regulations.

 

Issuer is not: (a) a “public utility company” or a

“holding company,” or an “affiliate” or a “Subsidiary company” of a “holding

company,” or an “affiliate” of such a “Subsidiary company,” as such terms are

defined in the Public Utility Holding Company Act of 1935, as amended, or (b)

an “investment company,” or an “affiliated person” of; or a “promoter” or

“principal underwriter” for, an “investment company,” as such terms are defined

in the Investment Company Act of 1940, as amended.  The issuance of the Notes hereunder and the application of the

proceeds and repayment thereof by Issuer and the performance of the

transactions contemplated by this Supplement and the other Series 2002-1

Transaction Documents will not violate any provision of the Investment Company

Act of 1940, as amended, or the Public Utility Holding Company Act of 1935, as

amended, or any rule, regulation or order issued by the Securities and Exchange

Commission thereunder.

 

Section 6.12         Solvency and

Separateness.

 

The Issuer represents, warrants and covenants to take

the following actions to maintain its existence separate and apart from any

other Person:

 

39

 

(i)            maintain books of

account in accordance with GAAP and maintain its accounts, books and records

separate from any other person or entity;

 

(ii)           not commingle its funds

or assets with those of any other entity;

 

(iii)          hold its assets in its

own name;

 

(iv)          conduct its business

solely in its own name;

 

(v)           pay its own liabilities

out of its own funds and assets;

 

(vi)          observe all corporate

formalities;

 

(vii)         maintain an arms-length

relationship with its affiliates;

 

(viii)        not assume or guarantee or

become obligated for the debts of any other entity or hold out its credit as

being available to satisfy the obligation of any other entity, and will not

permit any other person to assume or guarantee or become obligated for its

debts or hold out its credit as being available to satisfy the Issuer’s

obligations, except with respect to (A) obligations of the Seller under the

Guaranty and (B) obligations of the Seller to Lessees arising by operation of

law under Eligible Leases with respect to which the consent of such Lessees has

not been obtained prior to the transfer of such Eligible Leases to Issuer by

Seller pursuant to the Contribution and Sale Agreement

 

(ix)           not acquire obligations

or securities of its stockholders;

 

(x)            allocate fairly and

reasonably overhead or other expenses that are properly shared with any other

person or entity, including without limitation, shared office space, and use

separate stationery, invoices and checks;

 

(xi)           identify and hold

itself out as a separate and distinct entity under its own name and not as a

division or part of any other person or entity;

 

(xii)          correct any known

misunderstanding regarding its separate identity;

 

(xiii)         not make loans to any

person or entity;

 

(xiv)        not identify its

stockholders, or any affiliates of any of them, as a division or part of

itself;

 

(xv)         not enter into, or be a

party to, any transaction with its stockholders or their affiliates, except in

the ordinary course of its business and on terms which are intrinsically fair

and are no less favorable to it than would be obtained in a comparable

arms-length transaction with an unrelated third party;

 

(xvi)        pay the salaries of its

own employees, if any, from its own funds;

 

40

 

(xvii)       maintain capital that is

adequate for the business and undertakings of the Issuer;

 

(xviii)      have one director who shall

not have been, at the time of his or her appointment or at any time in the

preceding five (5) years: (a) a direct or indirect legal or beneficial

stockholder of the Issuer or any of its affiliates; (b) a creditor, supplier,

employee, officer, director, manager or contractor of the Issuer or any of its

affiliates; (c) a person who controls the Issuer or any of its affiliates;

or (d) a member of the immediate family of a person defined in (a), (b) or (c)

immediately above;

 

(xix)         is not insolvent under

the Insolvency Law and will not be rendered insolvent by the transactions

contemplated by the Series 2002-1 Transaction Documents and after giving effect

to such transactions, the Issuer will not be left with an unreasonably small

amount of capital with which to engage in its business nor will the Issuer have

intended to incur, or believed that it has incurred, debts beyond its ability

to pay such debts as they mature.  The

Issuer does not contemplate the commencement of insolvency, bankruptcy,

liquidation or consolidation proceedings or the appointment of a receiver,

liquidator, trustee or similar person in respect of the Issuer or any of its

assets.

 

Section 6.13         No Proceedings.

 

Each of the Issuer and the Indenture Trustee hereby

agrees that it will not institute against, or join any other Person in

instituting against Sheffield any bankruptcy, reorganization, arrangement,

insolvency or liquidation proceedings or other similar proceedings under the

laws of the United States or any other state of the United States, so long as

any Commercial Paper Notes shall be outstanding and there shall not have

elapsed one year and one day since the last day on which any such Commercial

Paper Notes shall have been outstanding.

 

Section 6.14         Recourse Against

Certain Parties.

 

(a)           No

recourse under or with respect to any obligation, covenant or agreement

(including, without limitation, the payment of any fees or any other

obligations) of any of the Issuer, the Servicer, Sheffield, any Purchaser or

the Deal Agent as contained in the Series 2002-1 Transaction Documents or any

other agreement, instrument or document entered into by it pursuant hereto or

in connection herewith shall be had against any administrator of such party or

any incorporator, affiliate, stockholder, officer, employee or director of such

party or of any such administrator, as such, by the enforcement of any

assessment or by any legal or equitable proceeding, by virtue of any statute or

otherwise; it being expressly agreed and understood that the agreements

of such party contained in the Series 2002-1 Transaction Documents and all of

the other agreements, instruments and documents entered into by it pursuant

hereto or in connection herewith are, in each case, solely the corporate

obligations of such party, provided  that in the case of

Sheffield, such liabilities shall be paid only after the repayment in full of

all Commercial Paper Notes and all other liabilities contemplated in the program

documents with respect to Sheffield, and that no personal liability whatsoever

shall attach to or be incurred by any administrator of such party or any

incorporator, stockholder, affiliate, officer, employee or director of such

party or of any such administrator, as such, or any of them, under or by reason

of any of the obligations, covenants or agreements of such Purchaser contained

in the Series 2002-1

 

41

 

Transaction

Documents or in any other such instrument, document or agreement, or which are

implied therefrom, and that any and all personal liability of every such

administrator of such party and each incorporator, stockholder, affiliate,

officer, employee or director of such party or of any such administrator, or

any of them, for breaches by such party of any such obligations, covenants or

agreements, which liability may arise either at common law or in equity, by

statute or constitution, or otherwise, is hereby expressly waived as a

condition of; and in consideration for, the execution of the Series 2002-1

Transaction Documents.

 

(b)           Notwithstanding

anything contained in this Agreement or any other Series 2002-1 Transaction

Document, Sheffield shall have no obligation to pay any amount required to be paid

by it hereunder or in excess of any amount available to Sheffield after paying

or making provision for the payment of its Commercial Paper Notes.  All payment obligations of Sheffield

hereunder are contingent upon the availability of funds in excess of the

amounts necessary to pay Commercial Paper Notes; and each of the Issuer, the

Deal Agent and the Servicer agrees that they shall not have a claim under

Section 101(5) of the United States Bankruptcy Code if and to the extent that

any such payment obligation exceeds the amount available to Sheffield to pay

such amounts after paying or making provision for the payment of its Commercial

Paper Notes.

 

(c)           The

provisions of this Section 6.14 shall survive the termination of this

Agreement.

 

Section 6.15         Survival of

Representations and Warranties.

 

So long as any of the Notes shall be Outstanding and

until payment and performance in full of the Outstanding Obligations, the

representations and warranties contained herein shall have a continuing effect

as having been true when made.

 

Section 6.16         No Event of Default or

Early Amortization Event.

 

No Event of Default or Early Amortization Event has

occurred and is continuing.

 

Section 6.17         Litigation and

Contingent Liabilities.

 

No claims, litigation, arbitration proceedings or

governmental proceedings by any Governmental Authority are pending or

threatened against or are affecting Issuer or any of its Subsidiaries the

results of which might interfere with the consummation of any of the

transactions contemplated by this Supplement or any document issued or

delivered in connection herewith.

 

Section 6.18         Title; Liens.

 

The Issuer has good, legal and marketable title to its

assets including the Collateral, and none of such assets is subject to any

Lien, except for the Lien created pursuant to the Indenture.  The Issuer has not assigned, conveyed,

pledged or otherwise transferred to any other Person any of its right, title or

interest in the Collateral.

 

42

 

Section 6.19         Subsidiaries.

 

At all times on or prior to the Effective Date, the

Issuer has had no subsidiaries other than WLFC Funding (Ireland) Limited, a

corporation organized under the law of the Republic of Ireland.

 

Section 6.20         No Partnership.

 

The Issuer is not a partner or joint venturer in any

partnership or joint venture.

 

Section 6.21         Pension and Welfare

Plans.

 

No accumulated funding deficiency (as defined in

Section 412 of the Code or Section 302 of ERISA) or reportable event (within

the meaning of Section 4043 of ERISA), has occurred with respect to any

Plan.  The present value of all benefit

liabilities under all Plans subject to Title IV of ERISA, as defined in Section

4001(a)(16) of ERISA, exceeds the fair market value of all assets of Plans

subject to Title IV of ERISA (determined as of the most recent valuation date

for such Plan on the basis of assumptions prescribed by the Pension Benefit

Guaranty Corporation for the purpose of Section 4044 of ERISA), by no more than

$1.9 million.  Neither Issuer nor any

ERISA Affiliate is subject to any present or potential withdrawal liability

pursuant to Title IV of ERISA and no multiemployer plan (within the

meaning of Section 4001 (a)(3) of ERISA) to which the Issuer or any ERISA

Affiliate has an obligation to contribute or any liability, is or is likely to

be disqualified for tax purposes, in reorganization within the meaning of

Section 4241 of ERISA or Section 418 of the Code) or is insolvent (as defined

in Section 4245 of ERISA).  No liability

(other than liability to make periodic contributions to fund benefits) with

respect to any Plan of Issuer, or Plan subject to Title IV of ERISA of any

ERISA Affiliate, has been, or is expected to be, incurred by Issuer or an ERISA

Affiliate, either directly or indirectly. 

All Plans of Issuer are in material compliance with ERISA and the

Code.  No lien under Section 412 of

the Code or 302(f) of ERISA or requirement to provide security under the Code

or ERISA has been or is reasonably expected by Issuer to be imposed on its assets.  The Issuer does not have any obligation

under any collective bargaining agreement. 

As of the Effective Date, the Issuer is not an employee benefit plan

within the meaning of ERISA or a “plan” within the meaning of Section 4975 of

the Code and assets of the Issuer do not constitute “plan assets” within the

meaning of Section 2510.3-101 of the regulations of the Department of Labor.

 

Section 6.22         Ownership of Issuer.

 

On the Effective Date, all of the issued and

outstanding common shares of the Issuer are owned by Willis Lease Finance

Corporation.

 

Section 6.23         Security Interest.

 

The security interest in the Collateral created

pursuant to the Indenture and this Supplement has been validly created, and no

other action is required to be taken by any person in order for the full

benefit of the security interest created thereby to vest in the Indenture

Trustee in order to insure the first priority perfected security interest of

the Indenture Trustee (for the benefit of the Series 2002-1 Noteholders) in the

Collateral.  Each Lease Agreement is

“chattel paper” (under the UCC, if the UCC is in effect in the jurisdiction

whose law governs the Lease

 

43

 

Agreement).  All executed

counterparts of each Lease Agreement (other than the one held by the related

Lessee or filed with any relevant Governmental Authority) that constitutes

“chattel paper” are in the possession of the Custodian.

 

Section 6.24         Eligible Lease

Agreements; Eligible Engines.

 

Each of the Lease Agreements is an Eligible Lease and

each Engine is an Eligible Engine.

 

ARTICLE

VII

 

EARLY AMORTIZATION

EVENT

 

Section 7.1            Early Amortization

Event.

 

With respect to the Series 2002-1 Notes, as of any

date of determination, the existence of any one of the following events or

conditions shall constitute an Early Amortization Event:

 

(i)            An “event of default”

under any Related Document (including an Event of Default) shall have occurred

and then be continuing;

 

(ii)           A Servicer Default

shall have occurred and then be continuing;

 

(iii)          The Aggregate Note

Principal Balance of any Series exceeds the Asset Base for such Series on any

Payment Date (after giving effect to any payments of principal on such Payment

Date) and such excess continues for a period of 10 consecutive days without

being cured;

 

(iv)          The EBIT Ratio of Issuer

shall be less than the Target EBIT Ratio;

 

(v)           Prior to the date on

which the Term Securitization is consummated, the Asset Base shall be less than

or equal to $60,000,000, or, as of the close of business on the date on which

the Term Securitization is consummated, either the Asset Base or the total

Outstanding Obligations for Series 2002-1 shall be greater than $0;

 

(vi)          The occurrence of any

other Early Amortization Event as specified in the Indenture;

 

(vii)         Outstanding Obligations

exceed 90% of the aggregate Appraised Values of each Eligible Engine and such

excess continues for a period of 10 consecutive days without being cured;

 

(viii)        The Quarterly Utilization

Rate is less than 75%.

 

(ix)           The failure to pay in

full on any Payment Date (a) interest accrued on the Notes, (b) the Class A

Minimum Principal Payment Amount and the Class B Minimum Principal Payment

Amount and, (c) after the Conversion Date, the Class A

 

44

 

Note Distributable

Amortization Amount and the Class B Note Distributable Amortization Amount.

 

ARTICLE

VIII

 

MISCELLANEOUS

PROVISIONS

 

Section 8.1            Ratification of

Indenture.

 

As supplemented by this Supplement, the Indenture is in

all respects ratified and confirmed and the Indenture as so supplemented by

this Supplement shall be read, taken and construed as one and the same

instrument.

 

Section 8.2            Counterparts.

 

This Supplement may be executed in two or more

counterparts, and by different parties on separate counterparts, each of which

shall be an original, but all of which shall constitute one and the same

Instrument.

 

Section 8.3            Governing Law.

 

THIS SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE

LAWS OF TILE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICTS OF LAW

PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF TILE PARTIES HEREUNDER

SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

[Remainder of Page

Intentionally Left Blank]

 

45

 

IN WITNESS WHEREOF, the Issuer and the Indenture

Trustee have caused this Supplement to be duly executed and delivered by their

respective officers thereunto duly authorized, all as of the day and year first

above written.

 

	

   

  	

  WILLIS ENGINE FUNDING LLC, as issuer

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ DONALD A. NUNEMAKER

  	

   

  
	

   

  	

  Name: Donald A. Nunemaker

  
	

   

  	

  Title: Vice President

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  THE BANK OF NEW YORK, as indenture trustee

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ SCOTT J. TEPPER

  	

   

  
	

   

  	

  Name: Scott J. Tepper

  
	

   

  	

  Title: Assistant Vice President

  
	

   

  	

   

  
	

   

  	

  THE BANK OF NEW YORK, as securities intermediary

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ SCOTT J. TEPPER

  	

   

  
	

   

  	

  Name: Scott J. Tepper

  
	

   

  	

  Title: Assistant Vice President

  

 

J-2-1

 

SCHEDULE 1

 

Section 1:              Definitions

 

“Africa/Middle East/Emerging Europe” means

the following countries: Czech Republic, Hungary, Poland, Bahrain, Israel,

Jordan, Morocco, Qatar, Slovakia, South Africa and Turkey.

 

“Applicable Percentage” means

                      

percent (     %).*

 

“Class A Note Commitment” means an amount

equal to the lesser of (i) the Class A Maximum Limit and (ii) the Senior Asset

Base.

 

“Class B Note Commitment” means an amount

equal to the lesser of (i) the Class B Maximum Limit and (ii) the Subordinate

Asset Base.

 

“Depreciation Percentage” means

                      

percent (     %).*

 

“Developed Asia/Pacific Rim” means the

following countries: Australia, Egypt, Fiji, Hong Kong, Japan, New Zealand,

Saudi Arabia, Singapore and Taiwan.

 

“Developed Europe” means the following countries:

Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland,

Italy, Malta, Norway, Portugal, Spain, Sweden, Switzerland, The Netherlands and

the United Kingdom.

 

“Emerging Asia” means the following

countries: China, India, Indonesia, Korea, Malaysia, Papua New Guinea,

Philippines, Sri Lanka and Thailand.

 

“Emerging Latin/South America” means the

following countries: Argentina, Aruba, Bolivia, Brazil, British West Indies,

Costa Rica, Chile, Columbia, Jamaica, Mexico and Peru.

 

“Emerging Market” means Emerging Latin/South

America, Emerging Asia and Emerging Africa/Middle East/Europe.

 

“Minimum Servicing Fee Percentage” means

      % per annum.*

 

“Servicing Fee” means for any Payment Date

an amount equal to the product of (x)               

percent (     %) and (y) the aggregate amount of

Engine Revenues with respect to the Series 2002–1 Engines during the

immediately preceding Collection Period; provided  however, that

if an Early Amortization Event has occurred and is continuing such fee shall

mean for any Payment Date an amount equal to the product of (x)

            

percent (     %) and (y) the aggregate amount of

Engine Revenues with respect to the Series 2002-1 Engines during the

immediately preceding Collection Period.*

 

*              This

redacted material has been omitted pursuant to a request for confidential

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

 

S1-1

 

“Single Lessee Percentage” means

                      

percent (     %); provided, however, that with respect

to any lessee which is located in an Emerging Market, the Single Lessee

Percentage shall mean             

percent (       %).*

 

“Target EBIT Ratio” means 1.20:1.0.

 

“Target On-Lease Percentage” means

                      

percent (     %).*

 

“Target One Year Lease Expiry Concentration Percentage”

means

                      

percent (     %).*

 

“Target Two Year Lease Expiry Concentration Percentage”

means

                      

percent (     %).*

 

“Three Lessee Percentage” means

                      

percent (     %).*

 

“Weighted Average Lease Rate Percentage”

means one percent (1.0%).

 

“Wide Body Aircraft Percentage” means

                      

percent (     %).*

 

Section 2:              Certain

Additional Terms.

 

Administrative Agent Fee.  The Issuer shall pay on each quarterly

Payment Date, beginning with the third Payment Date, an Administrative Agent

Fee to the Administrative Agent an amount equal to the product of (x)

      %, (y) one-fourth and (2) the Aggregate

Note Principal Balance.  Such

Administrative Agent Fee shall be payable on each quarterly Payment Date from

amounts then on deposit in the Series 2002-1 Series Account in accordance with

Section 3.02 of the Supplement.*

 

Interest Rate Hedge Agreements.  Beginning on September 12, 2002, the Issuer

at all times shall have Interest Rate Hedge Agreements in effect, each of which

has an aggregate notional amount of not less than 50% of the Outstanding

Obligations of the, Series 2002-1 Notes.

 

*              This

redacted material has been omitted pursuant to a request for confidential

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

 

S1-2

 

Section 3:               Geographic

Concentration Table.

 

“Section 3: Geographic Concentration Table”

 

	

  Geographic

  Region

  	

   

  	

  Maximum

  Geographic Percentage

  	

   

  
	

  Africa/Middle

  East/Emerging Europe

  	

   

  	

   

  	

  %*

  
	

  Emerging Asia

  	

   

  	

   

  	

  %*

  
	

  China(1)

  	

   

  	

   

  	

  %*

  
	

  Developed

  Asia/Pacific Rim

  	

   

  	

   

  	

  %*

  
	

  Developed Europe

  	

   

  	

   

  	

  %*

  
	

  North America

  	

   

  	

   

  	

  %*

  
	

  Emerging

  Latin/South America

  	

   

  	

   

  	

  %*

  
	

  Total Emerging

  Markets

  	

   

  	

   

  	

  %*

  

 

(1) People’s Republic of China, excluding Hong Kong.

 

 

*              This

redacted material has been omitted pursuant to a request for confidential

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

 

S1-3

 

SCHEDULE 2

to Series 2002-1 Supplement

“Initial

List of Engine and Lease Agreements”

(consisting of 23 pages)

 

Engines

 

One (1) General Electric model

CF6-80C2D1F aircraft engine bearing manufacturer’s serial number 704638

 

One (1) Pratt & Whitney

model PW2037 aircraft engine bearing manufacturer’s serial number 716430

 

One (1) Pratt & Whitney

model JT8D-219 aircraft engine bearing manufacturer’s serial number 728173

 

One (1) General Electric CF6-50C2 aircraft engine

bearing manufacturer’s serial number 455805

 

One (1) Pratt & Whitney JT8D-219 aircraft engine

bearing manufacturer’s serial number 716779

 

One (1) Pratt & Whitney JT8D-217C/219 aircraft

engine bearing manufacturer’s serial number 718210

 

One (1) CFM International CFM56-3B2 aircraft engine

bearing manufacturer’s serial number 725183

 

One (1) CFM International CFM56-3C1 aircraft engine

bearing manufacturer’s serial number 725522

 

One (1) CFM International CFM56-5A aircraft engine

bearing manufacturer’s serial number 733141

 

One (1) CFM International model CFM56-5A3 aircraft

engine bearing manufacturer’s serial number 733186

 

One (1) CFM International CFM56-5C aircraft engine

bearing manufacturer’s serial number 741551

 

One (1) CFM International CFM56-5B4/P aircraft engine

bearing manufacturer’s serial number 779194

 

One (1) CFM International CFM56-5B1/B2 aircraft engine

bearing manufacturer’s serial number 779484

 

One (1) CFM International CFM56-5B3-P aircraft engine

bearing manufacturer’s serial number 779542

 

One (1) CFM International CFM56-7 aircraft engine

bearing manufacturer’s serial number 874243

 

One (1) General Electric CF6-50C2 aircraft engine

bearing manufacturer’s serial number 528113

 

S1-4

 

One (1) Pratt & Whitney JT8D-219 aircraft engine

bearing manufacturer’s serial number 718035

 

One (1) Pratt & Whitney JT8D-219 aircraft engine

bearing manufacturer’s serial number 718064

 

One (1) Pratt & Whitney JT8D-217C/219 aircraft

engine bearing manufacturer’s serial number 718262

 

One (1) CFM International CFM56-3B2 aircraft engine

bearing manufacturer’s serial number 721877

 

One (1) Pratt & Whitney PW2037 aircraft engine

bearing manufacturer’s serial number 727057

 

One (1) Pratt & Whitney PW4062-3 aircraft engine

bearing manufacturer’s serial number 727340

 

One (1) Pratt & Whitney PW4062-3 aircraft engine

bearing manufacturer’s serial number 727393

 

One (1) Pratt & Whitney JT8D-219 aircraft engine

bearing manufacturer’s serial number 728154

 

One (1) CFM

International model CFM 56-5A3 aircraft engine bearing manufacturer’s serial

number 731570

 

One (1) CFM International CFM56-5A3 aircraft engine

bearing manufacturer’s serial number 731813

 

One (1) CFM International CFM56-5A3 aircraft engine

bearing manufacturer’s serial number 733163

 

One (1) CFM International CFM56-5A3 aircraft engine

bearing manufacturer’s serial number 733172

 

One (1) Pratt & Whitney PW4168A aircraft engine

bearing manufacturer’s serial number 733438

 

One (1) Pratt & Whitney PW4168A aircraft engine

bearing manufacturer’s serial number 733471

 

One (1) CFM International CFM56-5C3F aircraft engine

bearing manufacturer’s serial number 740342

 

One (1) CFM International CFM56-5C3F aircraft engine

bearing manufacturer’s serial number 741414

 

One (1) CFM International CFM56-3C1 aircraft engine

bearing manufacturer’s serial number 858327

 

One (1) CFM International CFM56-3C1 aircraft engine

bearing manufacturer’s serial number 858788

 

One (1) CFM International CFM56-3B2 aircraft engine

bearing manufacturer’s serial number 858789

 

5

 

One (1) CFM International CFM56-3C1 aircraft engine

bearing manufacturer’s serial number 858839

 

One (1) Pratt & Whitney PW4090 aircraft engine bearing

manufacturer’s serial number 222108

 

One (1) Pratt & Whitney PW4060-3 aircraft engine

bearing manufacturer’s serial number 724721

 

One (1) CFM International model CFM56-5A3 aircraft engine bearing

manufacturer’s serial number 733175

 

One (1) IAE model V2528-D5 aircraft engine bearing

manufacturer’s serial number V20001

 

One (1) IAE model V2528-D5  aircraft engine bearing manufacturer’s

serial number V20267

 

One (1) CFM International model

CFM56-5B aircraft engine bearing manufacturer’s serial number 575283

 

Leases

 

Engine 725183

 

Aircraft Engine Lease Agreement

dated as of June 30, 1999 (the “TAP Lease”) between Willis Lease Finance

Corporation (“Willis”) as lessor, and Transportes Aereos Portugueses,

S.A., as lessee, with the following

attached thereto: (i) General Terms Engine Lease Agreement dated as of June 30,

1999, and (ii) Engine Transfer Certificate dated as of June 30, 1999 between

Willis, as seller, and WLFC Funding Corporation, as issuer, which TAP Lease and

attachments were recorded by the FAA on July 6, 1999 and assigned Conveyance

No. YY025858, as amended by Letter Amendment dated as of June 29, 2001, which

was recorded by the FAA on September 25, 2001 and assigned Conveyance No.

FF32960, as amended by Letter Amendment dated as of September 28, 2001, which

was recorded by the FAA on October 11, 2001 and assigned Conveyance No.

ZZ025584, as further amended by Letter Amendment dated as of December 29, 2001,

which was recorded by the FAA on May 1, 2002 and assigned Conveyance No.

I070020.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

6

 

Engine 718210

 

Aircraft Engine Lease Agreement

dated as of October 30, 1997 between Terandon Leasing Corporation (“Terandon”),

as lessor, and SPANAIR, as lessee, with General Terms Engine Lease Agreement

dated as of October 30, 1997 attached thereto, which was recorded by the FAA on

December 15, 1995, and assigned Conveyance No.II010037, as assigned and assumed

by Assignment and Assumption Agreement and Bill of Sale dated as of

December 19, 1997 between Terandon, as assignor, and Willis Lease Finance

Corporation (“Willis”), as assignee, which was recorded by the FAA on January

27, 1998 and assigned Conveyance No. EE015339, as assigned and assumed under that certain Engine Transfer Certificate

dated as of December 19, 1997 between Willis, as seller, and WLFC Funding

Corporation, as issuer, which was recorded by the FAA on January 27, 1998 and

assigned Conveyance No. EE015340.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 874243

 

Aircraft Engine Lease Agreement

dated as of April 29, 1998 (the “Shanghai Lease”) between Willis Lease Finance

Corporation (“Willis”) as lessor, and Shanghai Airlines, as lessee, with the

following attached thereto: (i) General Terms Engine Lease Agreement dated as

of April 29, 1998, and (ii) Engine Transfer Certificate dated as of April 29,

1998 between Willis, as seller, and WLFC Funding Corporation, as issuer, which

Shanghai Lease and attachments were recorded by the FAA on June 11, 1998 and

assigned Conveyance No. MM015772 (the Engine Transfer Certificate was recorded

separately by the FAA on June 11, 1998 and assigned Conveyance No. MM015773).

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

7

 

Engine 455805

 

Aircraft Engine Lease Agreement dated as of May 14,

1998 (the “MTU Lease”), between AAR Aircraft & Engine Group, Inc. (“AAR”),

as lessor, and MTU Maintenance GmbH (“MTU”) as lessee, with the following

attached thereto: (i) Engine Delivery Receipt dated May 27, 1998, (ii) General

Terms Engine Lease Agreement dated as of March 8, 1996, (iii) Novation

Agreement dated as of May 21, 1998 among AAR, as assignor/seller, Kellstrom

Commercial Aircraft, Inc. (“Kellstrom”), as assignee/buyer, and MTU, as lessee,

(iv) Assignment and Assumption of Lease and Purchase and Sale of Engine

Agreement dated as of March 25, 1999 between Kellstrom, as assignor, and Willis

Lease Finance Corporation (“Willis”), as assignee, and (v) Engine Transfer

Certificate dated April 6, 1999 between Willis, as assignor, and WLFC Funding

Corporation, as assignee, which MTU Lease and attachments were recorded by the FAA on May 11, 1999 and assigned

Conveyance No. II014063.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 779194

 

Aircraft Engine Lease Agreement dated as of June 19,

1998 between Willis Lease Finance Corporation (“Willis”), as lessor, and Air

Jamaica Limited, as lessee, with General Terms Engine Lease Agreement dated as

of June 19, 1998, attached thereto, which was recorded by the FAA on August 5,

1998, and assigned Conveyance No. KK22899, as amended by Letter Amendment dated

January 25, 1999, which was recorded by the FAA on September 9, 1999, and

assigned Conveyance No. MM018466, as

assigned and assumed under that certain Engine Transfer Certificate dated as of

August 27, 1999 between Willis, as seller, and WLFC Funding Corporation, as

issuer, which was recorded by the FAA on August 31, 1999 and assigned

Conveyance No. II015208.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

8

 

Engine 779484

 

Aircraft Engine Lease Agreement dated as of December 22, 1998 between Willis Lease

Finance Corporation (“Willis”), as lessor, and Flying Colours Airlines Limited

(now JMC Airlines Ltd.), as lessee, with General Terms Engine Lease Agreement

dated as of December 21, 1998 attached thereto, which was recorded by the FAA

on January 4, 1999 and assigned Conveyance No. ZZ018400, as assigned and

assumed by Engine Transfer Certificate dated as of January 15, 1999 between

Willis, as seller, and WLFC Funding Corporation, as issuer, which was recorded

by the FAA on May 10, 1999 and assigned Conveyance No. II014049.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 733141

 

Engine Lease Agreement dated as

of August 21, 1998 (shown in the FAA records as dated August 31, 1998) between

Willis Lease Finance Corporation (“Willis”), as lessor, and Compagnie Nationale

Air France, now Société Air France, as lessee, which was recorded by the FAA on

September 1, 1998 and assigned Conveyance No. T058245, as assigned and assumed

by that certain Engine Transfer Certificate dated as of September 4, 1998

between Willis, as seller, and WLFC Funding Corporation, as issuer, which was

recorded by the FAA on November 5, 1998, and assigned Conveyance No. SS010988,

as amended by Amendment No. 1 dated August 18, 2000, which was recorded by the

FAA on October 25, 2000 and assigned Conveyance No. T064666, and as

further amended by Amendment No. 2 dated

March 1, 2002, which was recorded by the FAA on May 20, 2002 and assigned

Conveyance No. M000687.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by virtue

of the foregoing assignment, Willis Engine Funding LLC is the current lessor

under the above-described engine lease).

 

9

 

Engine 725522

 

Aircraft Engine Lease Agreement dated as of September 9, 1997 between Willis Lease

Finance Corporation (“Willis”), as lessor, and Jet Airways (India) Ltd., as

lessee, with General Terms Engine Lease Agreement dated as of July 1, 1997

attached thereto, which was recorded by the FAA on December 5, 1997 and

assigned Conveyance No. Z02548, as assigned and assumed by Engine Transfer

Certificate dated as of December 19, 1997 between Willis, as seller, and WLFC

Funding Corporation, as issuer, which was recorded by the FAA on January 27,

1998 and assigned Conveyance No. EE015340.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 779542

 

Aircraft Engine Lease Agreement dated as of July 29,

1998 between Willis Lease Finance Corporation (“Willis”), as lessor, and Air

2000 Limited, as lessee, with General Terms Engine Lease Agreement dated as of

December 9, 1996 attached thereto, which was recorded by the FAA on August 21,

1998 and assigned Conveyance No. PP010544, as amended by Letter Amendment dated

April 16, 1999, with Novation Agreement dated April 16, 1999 among Willis, as

assignor, WLFC Funding Corporation, as assignee, and Air 2000 Limited attached,

which was recorded by the FAA on May 18, 1999 and assigned Conveyance No.

K21295, as amended by Lease Amendment dated September 17, 1999, which was

recorded by the FAA on November 10, 1999 and assigned Conveyance No. JJ31856,

and as further amended by Lease Amendment dated March 30, 2000, which was

recorded by the FAA on May 2, 2000 and assigned Conveyance No. SS014493.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

10

 

Engine 716779

 

Aircraft Engine Lease Agreement dated as of October

17, 2001 between WLFC Funding Corporation, as lessor, and Vanguard Airlines, as

lessee, with General Terms Engine Lease Agreement dated as of October 17, 2001

attached thereto, which was recorded by the FAA on November 5, 2001 and

assigned Conveyance No. XX019451.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 741551

 

Aircraft Engine Lease Agreement

dated as of May 14, 1998 (the “Virgin Lease”) between Willis Lease Finance

Corporation (“Willis”) as lessor, and Virgin Atlantic Airways Ltd., as lessee,

with the following attached thereto: (i) General Terms Engine Lease Agreement

dated as of May 14, 1998, and (ii) Engine Transfer Certificate dated as of May

14, 1998 between Willis, as seller, and WLFC Funding Corporation, as issuer,

which Virgin Lease and attachments were recorded by the FAA on June 16, 1998

and assigned Conveyance No. EE016577 (the Engine Transfer Certificate was

recorded separately by the FAA on June 16, 1998 and assigned Conveyance No.

EE016578).

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine

222108

 

Aircraft Engine Lease Agreement dated as of December

1, 2000 between Willis Lease Finance Corporation (“Willis”), as lessor, and

WLFC (Ireland) Limited (“WLFCI”), as lessee, with General Terms Engine Lease

Agreement dated as of November 29, 2000 attached thereto, which was recorded by

the FAA on January 26, 2001 and assigned Conveyance No. TT014464, as

assigned by Assignment and Bill of Sale

dated as of May 31, 2001 between Willis, as assignor, and Wells Fargo Bank

Northwest, National Association, as owner trustee, as

 

11

 

assignee, which was recorded by the FAA on June

13, 2001 and assigned Conveyance No. JJ37092, as assigned and assumed by Deed

of Novation dated June 6, 2002 among WLFCI, as assignor, WLFC Funding (Ireland)

Limited, as assignee, and the owner trustee, which was recorded by the FAA on

June 18, 2002 and assigned Conveyance No. NN023493.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 718035

 

Engine Lease Agreement dated

January 7, 1992 (the “Avianca Lease”) between GPA Group plc (“GPA”), as lessor,

and Aerovias Nacionales de Colombia S.A. Avianca (“Avianca”), as lessee, with

the following attached thereto: (i) Engine Lease Assignment, Assumption and

Amendment Agreement dated September 30, 1997 between GPA as assignor, T-10 Inc.

as assignee, and Avianca as lessee, and (ii) Second Engine Lease Assignment,

Assumption and Amendment Agreement dated August 2, 2001 among T-10 Inc. as assignor,

Wells Fargo Bank Northwest, National Association, as owner trustee, as

assignee, and Avianca as lessee; which Avianca Lease and attachments were

recorded by the FAA on January 25, 2002 and assigned Conveyance No. W000315.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

12

 

Engine 718064

 

Engine Lease Agreement dated

January 7, 1992 (the “Avianca Lease”) between GPA Group plc (“GPA”), as lessor,

and Aerovias Nacionales de Colombia S.A. Avianca (“Avianca”), as lessee, with

the following attached thereto: (i) Engine Lease Assignment, Assumption and

Amendment Agreement dated September 30, 1997 between GPA as assignor, T-10 Inc.

as assignee, and Avianca as lessee, and (ii) Second Engine Lease Assignment,

Assumption and Amendment Agreement dated August 2, 2001 among T-10 Inc. as

assignor, Wells Fargo Bank Northwest, National Association, as owner trustee,

as assignee, and Avianca as lessee; which Avianca Lease and attachments were

recorded by the FAA on January 25, 2002 and assigned Conveyance No. W000317.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 858327

 

Aircraft Engine Lease Agreement

dated as of August 1, 2002 between Wells Fargo Bank Northwest, National

Association, as owner trustee, as lessor, and Frontier Airlines, Inc., as

lessee, with General Terms Engine Lease Agreement dated as of August 1, 2002

attached thereto, which was recorded by the FAA on August 28, 2002 and assigned

Conveyance No. XX021974.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

13

 

Engine 740342

 

Aircraft Engine Lease Agreement dated as of May 3,

2001 between Wells Fargo Bank Northwest, National Association, formerly First

Security Bank, National Association, as owner trustee, as lessor, and Gulf Air

Company G.S.C., as lessee, with General Terms Engine Lease Agreement dated March

28, 2001 attached thereto, which was recorded by the FAA on May  7, 2001 and assigned Conveyance No. Q67587.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 741414

 

Aircraft Engine Lease Agreement dated as of May 3,

2001 between Wells Fargo Bank Northwest, National Association, formerly First

Security Bank, National Association, as owner trustee, as lessor, and Gulf Air

Company G.S.C., as lessee, with General Terms Engine Lease Agreement dated March

28, 2001 attached thereto, which was recorded by the FAA on May  7, 2001 and assigned Conveyance No. Q67589.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 721877

 

Aircraft Engine Lease Agreement dated as of May 21,

2002 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Hainan Airlines, as

 

14

 

lessee, with General Terms Engine Lease Agreement dated May 21, 2002

attached thereto, which was recorded by the FAA on May 31, 2002 and assigned Conveyance No. K034326.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 858839

 

Aircraft Engine Lease Agreement dated as of May 21,

2002 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Hainan Airlines, as lessee, with General Terms Engine

Lease Agreement dated May 21, 2002 attached thereto, which was recorded by the

FAA on May 31, 2002 and assigned Conveyance

No. K034324.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as assignee,

attached thereto (by virtue of the foregoing assignments, Willis Engine Funding

LLC is the current lessor under the above-described engine lease).

 

Engine 727393

 

Aircraft Engine Lease Agreement dated as of April 13,

2002 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Hawaiian Airlines, Inc., as lessee, with General Terms

Engine Lease Agreement dated as of April 13, 2002 attached thereto, which was

recorded by the FAA on April 17, 2002 and

assigned Conveyance No. S118700.

 

15

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation Administration

on this date, but have not yet been recorded, true and correct copies of which

are attached hereto: (i) First Transfer Master Assignment and Assumption

Agreement and Bill of Sale [WLFC] dated

this date, between Wells Fargo Bank Northwest, National Association, not

individual but solely as owner trustee, as assignor, and WLFC Funding

Corporation, as assignee, and (ii) Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignments, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 731813

 

Aircraft Engine Lease Agreement dated as of December

19, 2001 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and International Lease Finance Corporation, as lessee,

with General Terms Engine Lease Agreement dated as of December 18, 2001

attached thereto, which was recorded by the FAA on December 21, 2001 and

assigned Conveyance No. K032713, as amended by Letter Amendment dated April 19, 2002, which was recorded by the

FAA on May 20, 2002 and assigned Conveyance No. II0025289, as amended by

Letter Amendment dated as of July 15, 2002,

which was recorded by the FAA on August 2, 2002 and assigned Conveyance No.

ZZ027761.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank Northwest,

National Association, not individual but solely as owner trustee, as assignor,

and WLFC Funding Corporation, as assignee, and (ii) Contribution and

Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 727340

 

Aircraft Engine Lease Agreement dated as of November

7, 2001 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Lan Chile S.A., as lessee, with General Terms Engine

Lease Agreement dated November 7, 2001 attached thereto, which was recorded by

the FAA on December 5, 2001 and assigned

Conveyance No. UU032267.

 

16

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 528113

 

Aircraft Engine Lease Agreement

dated as of January 21, 2000 between Willis Lease Finance Corporation

(“Willis”), as lessor, and MNG Havayollari Ve Tasimacilik Anonim Sirketi, as

lessee, with General Terms Engine Lease Agreement dated as of January 21, 2000

attached thereto, which was recorded by the FAA on February 25, 2000 and

assigned Conveyance No. QQ020822, as assigned by Assignment and Bill of Sale

dated as of March 24, 2000 between Willis, as assignor, and First Security

Bank, National Association, now Wells Fargo Bank Northwest, National

Association, as owner trustee, as assignee, which was recorded by the FAA on

June 27, 2000 and assigned Conveyance No. XX015520, as amended by Letter

Amendment dated May 2, 2000, which was recorded by the FAA on May 23, 2000 and

assigned Conveyance No. K25712, as amended by Letter Amendment dated July 22,

2000, which was recorded by the FAA on August 3, 2000 and assigned Conveyance

No. C39536, and as further amended by Letter Amendment dated December 20, 2001,

which was recorded by the FAA on December 31, 2001 and assigned Conveyance No.

BB036299.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as seller/assignor,

and Willis Engine Funding LLC, as issuer/assignee, with Engine and Beneficial

Interest Transfer Certificate dated this date between Willis Lease Finance

Corporation, as assignor, and Willis Engine Funding LLC, as assignee, attached

thereto (by virtue of the foregoing assignments, Willis Engine Funding LLC is

the current lessor under the above-described engine lease).

 

17

 

Engine 858788

 

Aircraft Engine Lease Agreement

dated as of March 16, 1998 (the “Rio-Sul Lease”) between Willis Lease Finance

Corporation (“Willis”), as lessor, and Rio-Sul Servicos Aereos Regionais S.A.,

as lessee, with the following attached thereto: (i) General Terms Engine Lease

Agreement dated as of February 27, 1998, and (ii) Engine Transfer Certificate

dated as of March 16, 1998, between Willis, as seller, and WLFC Funding

Corporation, as issuer, which Rio-Sul Lease and attachments were recorded by

the FAA on March 31, 1998 and assigned Conveyance No. H93122, as assigned by Assignment

and Bill of Sale dated as of June 12, 2002 between WLFC Funding Corporation, as

assignor, and Wells Fargo Bank Northwest, National Association, as owner

trustee, as assignee, which was recorded by the FAA on July 23, 2002 and

assigned Conveyance No. W000961.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 858789

 

Aircraft Engine Lease Agreement dated as of March 16,

1998 (the “Rio-Sul Lease”) between Willis Lease Finance Corporation (“Willis”),

as lessor, and Rio-Sul Servicos Aereos Regionais S.A. (“Rio-Sul”), as lessee,

with the following attached thereto: (i) General Terms Engine Lease Agreement

dated as of February 27, 1998, and (ii) Engine Transfer Certificate dated as of

March 16, 1998 between Willis, as seller, and WLFC Funding Corporation, as

issuer, which Rio-Sul Lease and attachments were recorded by the FAA on March

31, 1998 and assigned Conveyance No. H93123, as assigned and assumed by

Assignment and Bill of Sale dated as of June 12, 2002 between WLFC Funding

Corporation, as assignor, and Wells Fargo Bank Northwest, National Association,

as owner trustee, as assignee, which was recorded by the FAA on July 23, 2002 and assigned Conveyance No. W000964.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding

 

18

 

Corporation), as seller/assignor, and Willis Engine Funding LLC, as

issuer/assignee, with Engine and Beneficial Interest Transfer Certificate dated

this date between Willis Lease Finance Corporation, as assignor, and Willis

Engine Funding LLC, as assignee, attached thereto (by virtue of the foregoing

assignments, Willis Engine Funding LLC is the current lessor under the

above-described engine lease).

 

Engine 727057

 

Aircraft Engine Lease Agreement

dated as of June 18, 1998 between Willis Lease Finance Corporation (“Willis”),

as lessor, and Shanghai Airlines, as lessee, with General Terms Engine Lease

Agreement dated as of April 29, 1998 attached thereto, which was recorded by

the FAA on August 5, 1998 and assigned Conveyance No. KK22897, as assigned by

Assignment and Bill of Sale dated as of May 22, 2001 between Willis, as

assignor, and Wells Fargo Bank Northwest, National Association, as owner

trustee, as assignee, with Joinder and Amendment Agreement dated May 22, 2000

attached thereto, which was recorded by the FAA on June 14, 2001 and assigned

Conveyance No. KK028508.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 733163

 

Aircraft Engine Lease Agreement

dated as of March 22, 2002 between Wells Fargo Bank Northwest, National Association,

as owner trustee, as lessor, and Snecma Services S.A., as lessee, with General

Terms Engine Lease Agreement dated March 22, 2002 attached thereto, which was

recorded by the FAA on April 9, 2002 and assigned Conveyance No. JJ40857.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct copies

of which are attached hereto: (i) First Transfer Master Assignment and

Assumption Agreement and Bill of Sale [WLFC] dated

this date, between Wells Fargo Bank Northwest, National Association, not

individual but solely as owner trustee, as assignor, and WLFC Funding

Corporation, as assignee, and (ii) Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine

 

19

 

and Beneficial Interest Transfer Certificate dated this date between

Willis Lease Finance Corporation, as assignor, and Willis Engine Funding LLC,

as assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 728154

 

Aircraft Engine Lease Agreement

dated as of March 7, 2001 between First Security Bank, National Association,

now Wells Fargo Bank Northwest, National Association, as owner trustee, as

lessor, and Spanair S.A., as lessee, with General Terms Engine Lease Agreement

dated March 7, 2001 attached thereto, which was recorded by the FAA on March

22, 2001 and assigned Conveyance No. H101539.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as seller/assignor,

and Willis Engine Funding LLC, as issuer/assignee, with Engine and Beneficial

Interest Transfer Certificate dated this date between Willis Lease Finance

Corporation, as assignor, and Willis Engine Funding LLC, as assignee, attached

thereto (by virtue of the foregoing assignments, Willis Engine Funding LLC is

the current lessor under the above-described engine lease).

 

Engine 733438

 

Aircraft Engine Lease Agreement

dated as of November 29, 2000 between First Security Bank, National Association,

now Wells Fargo Bank Northwest, National Association, as owner trustee, as

lessor, and SR Technics AG, as lessee, with General Terms Engine Lease

Agreement dated November 29, 2000 attached thereto, which was recorded by the

FAA on February 1, 2001 and assigned Conveyance No. HK020200.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as seller/assignor,

and Willis Engine Funding LLC, as issuer/assignee, with Engine and Beneficial

Interest Transfer Certificate dated this date between Willis Lease Finance

Corporation, as assignor, and Willis Engine Funding LLC, as assignee, attached

thereto (by

 

20

 

virtue of the foregoing assignments, Willis Engine Funding LLC is the

current lessor under the above-described engine lease).

 

Engine 733471

 

Aircraft Engine Lease Agreement

dated as of November 29, 2000 between First Security Bank, National

Association, now Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and SR Technics AG, as lessee, with General Terms Engine

Lease Agreement dated November 29, 2000 attached thereto, which was recorded by

the FAA on May 7, 2001 and assigned Conveyance No. H101988.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine 733172

 

Aircraft Engine Lease Agreement

dated as of September 2, 2002 between Wells Fargo Bank Northwest, National

Association, as owner trustee, as lessor, and Gulf Aircraft Maintenance

Company, as lessee, with General Terms Engine Lease Agreement dated as of

August 12, 2002 attached thereto, which was recorded by the FAA on September 6,

2002 and assigned Conveyance No. J001573.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

21

 

Engine 718262

 

Aircraft Engine Lease Agreement

dated as of July 23, 2002 between Wells Fargo Bank Northwest, National

Association, as owner trustee, as lessor, and Vanguard Airlines, as lessee,

with General Terms Engine Lease Agreement dated July 23, 2002 attached thereto,

which was recorded by the FAA on August 9, 2002 and assigned Conveyance No.

CC016158.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

Engine

724721

 

Aircraft Engine Lease Agreement dated as of November

29, 2000 between Willis Lease Finance Corporation (“Willis”), as lessor, and

WLFC (Ireland) Limited (“WLFCI”), as lessee, with General Terms Engine Lease

Agreement dated as of November 29, 2000 attached thereto, which was recorded by

the FAA on January 5, 2001 and assigned Conveyance No. YY030445, as

assigned by Assignment and Bill of Sale

dated as of May 31, 2001 between Willis, as assignor, and Wells Fargo Bank

Northwest, National Association, as owner trustee, as assignee, which was

recorded by the FAA on June 14, 2001 and assigned Conveyance No. JJ37144, as

assigned by Deed of Novation dated June 6, 2002 among WLFCI, as assignor, WLFC

Funding (Ireland) Limited, as assignee, and the owner trustee, which was

recorded by the FAA on June 27, 2002 and assigned Conveyance No. TT016885.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

22

 

Engine 733186

 

Aircraft Engine Lease Agreement

dated as of March 9, 2001 (the “SNECMA Lease”) between WLFC Funding

Corporation, as lessor, and SNECMA Services S.A. (“SNECMA”), as lessee, with

the following attached thereto:  (i)

General Terms Engine Lease Agreement dated September 11, 1999 between Willis

Lease Finance Corporation (“Willis”), as lessor, and SNECMA, as lessee, (ii)

Assignment dated as of March 9, 2001 between Willis, as assignor, and WLFC

Funding Corporation, as assignee, which SNECMA Lease and attachments were

recorded by the FAA on April 20, 2001 and assigned Conveyance No. L73991, as

amended by Letter Amendment dated January 7, 2002 between WLFC Funding

Corporation, as lessor, and SNECMA, as lessee, which was recorded by the FAA on

February 2, 2002 and assigned Conveyance No. T068730.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following document, which was filed for recording with the Federal Aviation

Administration on this date, but has not yet been recorded, a true and correct

copy of which is attached hereto: Contribution and Sale Agreement dated

as of September 12, 2002 between Willis Lease Finance Corporation (as successor

by merger to WLFC Funding Corporation), as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignment, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 731570

 

Aircraft Engine Lease Agreement dated as of August 26,

2002 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Gulf Aircraft Maintenance Company, as lessee, with

General Terms Engine Lease Agreement dated August 12, 2002 attached thereto,

which was recorded by the FAA on August 28, 2002 and assigned Conveyance No.

XX021984.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation (as successor by merger to WLFC Funding Corporation), as

seller/assignor, and Willis Engine Funding LLC, as issuer/assignee, with Engine

and Beneficial Interest Transfer Certificate dated this date between Willis

Lease Finance Corporation, as assignor, and Willis Engine Funding LLC, as

assignee, attached thereto (by virtue of the foregoing assignments, Willis

Engine Funding LLC is the current lessor under the above-described engine

lease).

 

23

 

Engine 716430

 

Aircraft Engine Lease Agreement

dated July 19, 2001 (the “TWA Lease”) between Kellstrom Industries, Inc., as

lessor, and TWA Airlines LLC (“TWA”), as lessee, with the following attached

thereto:  (i) Engine Lease General Terms

Agreement dated as of June 28, 2001, and (ii) Assignment and Assumption of

Lease and Purchase and Sale of Engine Agreement dated as of July 31, 2001 among

Kellstrom Industries, Inc., as assignor, Willis Lease Finance Corporation, as

beneficiary, and Wells Fargo Bank Northwest, National Association, as owner

trustee, as assignee, which TWA Lease and attachments were recorded by the FAA

on October 1, 2001 and assigned Conveyance No. L75041.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [Willis] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and Willis Lease Finance Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation, as seller/assignor, and Willis Engine Funding LLC, as

issuer/assignee, with Engine and Beneficial Interest Transfer Certificate dated

this date between Willis Lease Finance Corporation, as assignor, and Willis

Engine Funding LLC, as assignee, attached thereto (by virtue of the foregoing

assignments, Willis Engine Funding LLC is the current lessor under the

above-described engine lease).

 

Engine 733175

 

Aircraft Engine Lease Agreement dated as of December

1, 2000 between Willis Lease Finance Corporation, as lessor, and WLFC (Ireland)

Limited, as lessee, with General Terms Engine Lease Agreement dated as of

November 29, 2000 attached thereto, which was recorded by the FAA on February

26, 2001 and assigned Conveyance No. I067517, as amended by Letter Amendment dated May 23, 2001 which was

recorded by the FAA on July 5, 2001 and assigned Conveyance No. HK021663,

as assigned and assumed by Assignment and Bill of Sale dated as of December 21,

2001 between Willis Lease Finance Corporation, as assignor, and Wells Fargo

Bank Northwest, National Association, as owner trustee, as assignee, which was

recorded by the FAA on January 28, 2002 and assigned Conveyance No. FF33661,

and as further assigned and assumed by Deed of Novation dated June 6, 2002

among WLFC (Ireland) Limited as assignor, WLFC Funding (Ireland) Limited as

assignee, and Wells Fargo Bank Northwest, National Association, as lessor,

which was recorded by the FAA on June 18, 2002 and assigned Conveyance No.

NN023496.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [WLFC] dated this date, between Wells Fargo Bank

Northwest,

 

24

 

National Association, not individual but solely

as owner trustee, as assignor, and WLFC Funding Corporation, as assignee, and

(ii) Contribution and Sale Agreement dated as of September 12, 2002

between Willis Lease Finance Corporation (as successor by merger to WLFC

Funding Corporation), as seller/assignor, and Willis Engine Funding LLC, as

issuer/assignee, with Engine and Beneficial Interest Transfer Certificate dated

this date between Willis Lease Finance Corporation, as assignor, and Willis

Engine Funding LLC, as assignee, attached thereto (by virtue of the foregoing

assignments, Willis Engine Funding LLC is the current lessor under the

above-described engine lease).

 

Engine 704638

 

Aircraft Engine Lease Agreement

dated as of March 16, 1998 between Willis Lease Finance Corporation, as lessor,

and “VARIG”, S.A. (Viacao Aerea Rio-Grandense), as lessee, with General Terms

Engine Lease Agreement dated as of February 27, 1998 attached thereto, which

was recorded by the FAA on June 30, 1998 and assigned Conveyance

No. H94205, as assigned and assumed by Assignment and Bill of Sale dated

as of December 4, 2001 between Willis Lease Finance Corporation, as assignor,

and Wells Fargo Bank Northwest, National Association, as owner trustee, as

assignee, which was recorded by the FAA on January 11, 2002 and assigned

Conveyance No. I069446.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation

Administration on this date, but have not yet been recorded, true and correct

copies of which are attached hereto: (i) First Transfer Master

Assignment and Assumption Agreement and Bill of Sale [Willis] dated this date, between Wells Fargo Bank

Northwest, National Association, not individual but solely as owner trustee, as

assignor, and WLFC Funding Corporation, as assignee, and (ii) Contribution

and Sale Agreement dated as of September 12, 2002 between Willis Lease Finance

Corporation, as seller/assignor, and Willis Engine Funding LLC, as

issuer/assignee, with Engine and Beneficial Interest Transfer Certificate dated

this date between Willis Lease Finance Corporation, as assignor, and Willis

Engine Funding LLC, as assignee, attached thereto (by virtue of the foregoing

assignments, Willis Engine Funding LLC is the current lessor under the

above-described engine lease).

 

Engine 728173

 

Aircraft Engine Lease Agreement dated as of November

16, 2001 between Wells Fargo Bank Northwest, National Association, as owner

trustee, as lessor, and Spirit Airlines, Inc., as lessee, with General Terms

Engine Lease Agreement dated November 4, 2001 attached thereto, which was recorded by the FAA on December 4, 2001 and

assigned Conveyance No. SS017842.

 

The foregoing engine lease, as

assigned, assumed and/or amended, has been assigned and assumed pursuant to the

following documents, which were filed for recording with the Federal Aviation Administration

on this date, but have not yet been recorded, true and correct copies of which

are attached hereto: (i) First Transfer Master Assignment and Assumption

Agreement and Bill of Sale [Willis] dated

this date, between Wells Fargo Bank Northwest,

 

25

 

National Association, not individual but solely

as owner trustee, as assignor, and WLFC Funding Corporation, as assignee, and

(ii) Contribution and Sale Agreement dated as of September 12, 2002

between Willis Lease Finance Corporation, as seller/assignor, and Willis Engine

Funding LLC, as issuer/assignee, with Engine and Beneficial Interest Transfer

Certificate dated this date between Willis Lease Finance Corporation, as

assignor, and Willis Engine Funding LLC, as assignee, attached thereto (by

virtue of the foregoing assignments, Willis Engine Funding LLC is the current

lessor under the above-described engine lease).

 

Engine 20001

 

None

 

Engine 20267

 

None

 

Engine 575283

 

None

 

26Exhibit

10.27

 

GUARANTY

 

This GUARANTY (this “Guaranty”) dated as of September

12, 2002 is made by WILLIS LEASE FINANCE CORPORATION, a Delaware corporation

(together with its successors and assigns, the “Guarantor”), in favor of

BARCLAYS BANK PLC, a public limited company organized under the law of England

and Wales, in its capacity as Deal Agent (as defined below) and as a Class B

Purchaser (as defined below), and FORTIS BANK (NEDERLAND) N.V., organized under

the laws of the Netherlands, in its capacity as a Class B Purchaser (as defined

below).

 

RECITALS

 

WHEREAS, Willis Engine Funding LLC (“Issuer”), the

Guarantor, Sheffield Receivables Corporation (the “Class A Purchaser”) and

Barclays Bank PLC, as deal agent (the “Deal Agent”), have entered into that certain

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

Note Purchase Agreement”), pursuant to which the Class A Purchaser agreed to

purchase up to $180,000,000 aggregate principal amount of notes entitled Willis

Engine Funding LLC Secured Notes, Series 2002-1 Class A (the “Class A Notes”)

issued pursuant to the Indenture, dated as of September 12, 2002 (the “Trust

Indenture”), and the Series 2002-1 Supplement, dated as of September 12, 2002

(the “2002-1 Supplement” and, together with the Trust Indenture, the

“Indenture”), between Issuer and The Bank of New York (“Indenture Trustee”);

 

WHEREAS, the Issuer, the Guarantor, Barclays Bank PLC

(together with its successors and assigns, in such capacity, a “Class B

Purchaser”), Fortis Bank (Nederland) N.V. (together with its successors and

assigns, a “Class B Purchaser” and together with Barclays Bank PLC in its

capacity as a Class B Purchaser, the “Class B Purchasers”) and the Deal Agent

have entered into that certain Class B Note Purchase Agreement dated as of

September 12, 2002 (the “Class B Note Purchase Agreement”), pursuant to which

the Class B Purchasers agreed to purchase up to $20,000,000 aggregate principal

amount of notes entitled Willis Engine Funding LLC Secured Notes, Series 2002-1

Class B (the “Class B Notes”) issued pursuant to the Indenture;

 

WHEREAS, it is a condition of the effectiveness of the

Class B Note Purchase Agreement that the Guarantor execute and deliver this

Guaranty; and

 

WHEREAS, Guarantor is the owner of all of the capital

stock of Issuer and will obtain substantial direct and indirect benefit from

the purchase of the Class A Notes and the Class B Notes by the Class A

Purchaser and the Class B Purchasers, respectively;

 

NOW, THEREFORE, in consideration of the foregoing

recitals and other good and valuable consideration, the receipt and adequacy of

which is hereby acknowledged, and intending to be legally bound, the parties

hereto do hereby agree as follows:

 

AGREEMENT

 

Section

1.              Definitions.  Capitalized terms used herein shall have the

following meanings:

 

1

 

Guaranty

Amount:  As of any

date of determination, an amount equal to the excess of (A) the lesser of

(i) the Class B Note Principal Balance as of such date and (ii) 10%

of the Outstanding Obligations as of such date over (B) the Guaranty Deduction

Amount as of such date.

 

Guaranty

Deduction Amount:  As

of any date of determination, an amount equal to the sum of (a) any amounts

prior to or as of such date paid by Guarantor pursuant to the Indemnification

Agreement and (b) any amounts prior to or as of such date paid by Guarantor to

lessees, sublessees or other Persons pursuant to the Guarantor’s obligations as

surety with respect to the obligations of Issuer or any Owner Trustee pursuant

to any Lease.

 

Indebtedness:  With respect to any Person means, without

duplication, (a) any obligation of such Person for borrowed money, including,

without limitation, (i) any obligation incurred through the issuance and

sale of bonds, debentures, notes or other similar debt instruments, and

(ii) any obligation for borrowed money which is non-recourse to the credit

of such Person but which is secured by any asset of such Person, (b) any

obligation of such Person on account of deposits or advances, (c) any

obligation of such Person for the deferred purchase price of any property or

services, except accounts payable arising in the ordinary course of such

Person’s business, (d) any obligation of such Person as lessee under a capital

lease, (e) any Indebtedness of another secured by a Lien on any asset of such

Person, whether or not such Indebtedness is assumed by such Person and (f) any

obligation in respect of interest rate or foreign exchange hedging agreements.

 

Indemnification

Agreement:  The

Indemnification Agreement dated as of September 12, 2002 between the Guarantor

and the Indenture Trustee.

 

All other capitalized terms not otherwise defined

herein have the meanings set forth in the Indenture.

 

Section

2.              Acknowledgment; Guaranty.  Guarantor hereby unconditionally, absolutely

and irrevocably guarantees to the Class B Purchasers, up to an amount not

exceeding the Guaranty Amount (items (i) through (iii) collectively,

the “Guaranteed Indebtedness”): (i) the full and prompt payment of the

principal balance of the Class B Notes and the indebtedness represented thereby

as and when due or at such earlier date as may result from the acceleration

thereof as a result of the occurrence of an Early Amortization Event or an

Event of Default under the terms of the Indenture; (ii) the full and

prompt payment of the interest on the outstanding principal balance of the

Class B Notes as and when due or at such earlier date as may result from the

acceleration thereof following an Early Amortization Event or an Event of

Default under the terms of the Indenture; and (iii) the full and prompt payment

of an amount equal to each and all of the payments and other sums, when and as

the same shall become due, required to be paid by the Issuer to the Class B

Noteholders under the terms of the Indenture.

 

Section

3.              Guaranty Unconditional.  The obligations of Guarantor hereunder are

irrevocable, absolute and unconditional, irrespective of the value,

genuineness, regularity, validity or enforceability of the Guaranteed

Indebtedness or any other circumstances which might otherwise constitute a

legal or equitable discharge or defense of a surety or guarantor.  No setoff, abatement, recoupment,

counterclaim, reduction or diminution of an obligation, or any

 

2

 

defense

of any kind or nature (other than performance by Guarantor of its obligations

hereunder or the payment in full of the Guaranteed Indebtedness), which

Guarantor has or may have with respect to a claim under this Guaranty, shall be

available hereunder to Guarantor against the Class B Purchasers.

 

Section

4.              Payments.  All payments to be made by Guarantor to or

for the benefit of the Class B Purchasers hereunder shall be made, in

accordance with the written direction of each of the Class B Purchasers, by

wire transfer in lawful money of the United States of America, in immediately

available funds, and shall be accompanied by a notice from Guarantor stating

that such payments are made under this Guaranty.

 

Section 5.              Representations, Warranties and Covenants.  Guarantor hereby

represents and warrants to the Class B Purchasers that:

 

(a)           The

Guarantor is a corporation duly organized, validly existing and in good

standing under the laws of the state of its incorporation, has full corporate

power to own its assets and to engage in the activities in which it is now

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

jurisdiction where the conduct of its activities requires such qualification,

if the failure to so qualify would have a material adverse effect on the

condition (financial or otherwise) of the Guarantor;

 

(b)           The

Guarantor has full power, authority and legal right to execute, deliver and

perform this Guaranty and has taken all necessary action to authorize the

execution, delivery and performance by it of this Guaranty.  No consent, license, permit, approval or

authorization of, exemption by, notice or report to, or registration, filing or

declaration with, any Governmental Authority is required for the execution,

delivery and performance by the Guarantor of this Guaranty which has not been

obtained, made, given or accomplished. This Guaranty has been duly executed and

delivered by a duly authorized representative of the Guarantor, and this

Guaranty constitutes the valid, legal and binding obligations of the Guarantor,

enforceable against the Guarantor in accordance with its respective terms,

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

reorganization, moratorium or other similar laws affecting creditors’ rights

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

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

 

(c)           The

execution, delivery and performance by the Guarantor of this Guaranty will not

violate any provision of any law or regulation applicable to the Guarantor, or

of any order, judgment, award or decree of any court, arbitrator or

Governmental Authority applicable to the Guarantor or the organizational documents

of the Guarantor or any mortgage, indenture, lease, contract or other

agreement, instrument or undertaking to which the Guarantor is a party or by

which the Guarantor or any of its assets may be bound, and will not result in,

or require, the creation or imposition of any lien on any of its property,

assets or revenues pursuant to the provisions of any such mortgage, indenture,

lease, contract or other agreements, instrument or undertaking;

 

(d)           No

litigation, investigation or administrative proceeding of or before any court,

arbitrator or governmental authority is pending or, to the Guarantor’s

knowledge, threatened against the Guarantor which if decided adversely to the

Guarantor, would materially affect the

 

3

 

condition

(financial or otherwise), business or operations of the Guarantor, or the

ability of the Guarantor to perform its obligations under this Guaranty;

 

(e)           All

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

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

official, required in connection with the execution, delivery and performance

of this Guaranty by the Guarantor, have been taken or obtained on or prior to

the Effective Date;

 

(f)            The

financial statements of Guarantor dated as of December 31, 2001 (audited), a

copy of which have been furnished to the Deal Agent, fairly present the

financial position and results of operations for Guarantor for the dates and

periods purported to be covered thereby, all in accordance with GAAP, and there

has been no Material Adverse Change in the financial position or operations of

Guarantor since the date of such financial statements; and

 

(g)           Guarantor

is not insolvent as of the Effective Date and the incurrence of Guarantor’s

obligations under this Guaranty will not cause Guarantor: (i) to become

insolvent; (ii) to be left with unreasonably small capital for any

business or transaction in which Guarantor is presently engaged or plans to be

engaged; or (iii) to be unable to pay its debts as such debts mature.

 

Section

6.              Consents.  Guarantor hereby consents that any or all of

the following actions may be taken or things done without notice to Guarantor

and without affecting the liability of Guarantor under this Guaranty:

 

A.            The

time for Issuer’s performance of or compliance with any of the terms of the

Guaranteed Indebtedness may be accelerated (upon an Event of Default), or

extended or such performance or compliance may be waived by the Deal Agent

(including, without limitation, the renewal, extension, acceleration (upon an

Event of Default) or other change in the time of payment, or other terms of,

the Guaranteed Indebtedness, such as an increase or decrease in the rate of

interest thereon); and

 

B.            The

terms of any of the Guaranteed Indebtedness or any term or condition in the

Indenture may be amended as provided for therein by the Issuer and Deal Agent,

as the case may be, for the purpose of adding any provisions thereto or

changing in any manner the rights or obligations of Issuer and/or Deal Agent

thereunder.

 

Section

7.              Due Diligence.  Guarantor acknowledges that it has,

independently of and without reliance on the Deal Agent, made its own credit

analysis of Issuer and performed its own legal review of this Guaranty, the

Indenture, the Contribution and Sale Agreement, the Class A Note Purchase

Agreement, the Class B Note Purchase Agreement and the Related Documents and

all related documents and filings, and Guarantor is not relying on the Deal Agent

with respect to any of the aforesaid items. Guarantor has established adequate

means of obtaining from Issuer on a continuing basis financial and other

information pertaining to Issuer’s financial condition. Guarantor agrees to

keep adequately informed from such means of any facts, events or circumstances

which might in any way affect Guarantor’s risks hereunder, and Guarantor

further agrees that the Deal Agent shall have no obligation to disclose to

Guarantor information or

 

4

 

material

with respect to Issuer acquired in the course of the Deal Agent’s relationship

with Issuer.

 

Section

8.              Tolling of Statute of

Limitations. 

Guarantor agrees that any payment or performance of any of the terms of

the Guaranteed Indebtedness or other acts which tolls any statute of

limitations applicable to the Guaranteed Indebtedness shall also toll the

statute of limitations applicable to Guarantor’s liability under this Guaranty.

 

Section

9.              Waiver.  Guarantor hereby expressly waives diligence,

presentment, demand for payment, protest, benefit of any statute of limitations

affecting Issuer’s liability under the Class B Notes or the Indenture or the

enforcement of this Guaranty, discharge due to any disability of Issuer, any

defenses of Issuer to its obligations under the Class B Notes or the Indenture

not arising under the express terms of the Class B Notes or the Indenture or

from a material breach thereof by Deal Agent or a Class B Purchaser which under

the law has the effect of discharging Issuer from the Guaranteed Indebtedness

as to which this Guaranty is sought to be enforced, the benefit of any act or

omission by the Deal Agent or a Class B Purchaser that directly or indirectly

results in or aids the discharge of Issuer from any of the Guaranteed

Indebtedness by operation of law or otherwise, all notices whatsoever,

including, without limitation, notice of acceptance of this Guaranty and the

incurring of the Guaranteed Indebtedness, and any requirement that the Deal Agent

or a Class B Purchaser exhaust any right, power or remedy or proceed against

Issuer, the Collateral or any other guarantor of, or any other Person liable

for, any of the Guaranteed Indebtedness, or any portion thereof. Guarantor

specifically agrees that it will not be necessary or required, and Guarantor

shall not be entitled to require, that Deal Agent or a Class B Purchaser file

suit or proceed to assert or obtain a claim for personal judgment against

Issuer for the Guaranteed Indebtedness, or to make any effort at collection or

enforcement of the Guaranteed Indebtedness from Issuer or file suit or proceed

to obtain or assert a claim for personal judgment against Guarantor or any

other guarantor or other party liable for the Guaranteed Indebtedness or make

any effort at collection of the Guaranteed Indebtedness from any such party or

exercise or assert any other right or remedy to which the Deal Agent or a Class

B Purchaser is or may be entitled in connection with the Guaranteed

Indebtedness or guaranty relating thereto or assert or file any claim against

the assets of Issuer, before or as a condition of enforcing the liability of

Guarantor under this Guaranty.

 

Section

10.            Certain Rights.  In pursuing their rights under this

Guaranty, the Class B Purchasers need not join Guarantor in any suit against

Issuer or join Issuer in any suit against Guarantor.

 

Section

11.            Continuing Guaranty.  This Guaranty shall be a continuing guaranty

and any other guarantors of all or a portion of the Guaranteed Indebtedness may

be released without affecting the liability of Guarantor hereunder.

 

Section

12.            Indemnity.  In addition to and without limiting or

impairing in any manner whatsoever Guarantor’s other obligations under this

Guaranty or any other document executed and delivered by Guarantor to the Deal

Agent or the Class B Purchasers, Guarantor agrees to indemnify the Deal Agent

and the Class B Purchasers from and against any and all costs, expenses, losses

and liabilities relating to claims by any third parties growing out of or

 

5

 

resulting

from transactions contemplated by this Guaranty (including, without limitation,

enforcement of this Guaranty).

 

Section

13.            Notice.  The Deal Agent shall provide Guarantor with

a copy of any notice of default to Issuer as provided under the Indenture;

provided, however, the failure of Deal Agent to provide such notice to

Guarantor will not exonerate Guarantor of any Guaranteed Indebtedness. All

notices and communications under this Agreement shall be in writing personally

delivered, or sent by facsimile (with subsequent telephone confirmation of

receipt thereof) or sent by overnight courier service at the following

addresses: Guarantor, at its address at Willis Lease Finance Corporation, 2320

Marinship Way, Suite 300, Sausalito, CA 94965; and Deal Agent, at its address

at 200 Park Avenue, New York, New York 10166, Attention: Asset Securitization

Group or, as to each party, at such other address as shall be designated by

such party in a written notice to the other party complying as to delivery with

the terms of this Section 13. Notice shall be effective and deemed received (a)

two days after being delivered to the courier service, if sent by courier, (b)

upon receipt of confirmation of transmission, if sent by telecopy, or (c) when

delivered, if delivered by hand. All such notices and communications shall,

when hand delivered be effective upon delivery, when sent by courier be

effective on the next succeeding Business Day.

 

Section

14.            Reinstatement.  Notwithstanding any provision in the

Indenture or the Class B Notes to the contrary, the liability of Guarantor

hereunder shall be reinstated and revived and the rights of the Class B

Purchasers shall continue if and to the extent that for any reason any payment

by or on behalf of Issuer is rescinded or must be otherwise restored by the

Class B Purchasers, whether as a result of any proceedings in bankruptcy or

reorganization or otherwise, all as though such amount had not been paid.  The determination as to whether any such

payment must be rescinded or restored shall be made by the Class B Purchasers

in their sole discretion; provided, however, that if the Class B Purchasers

choose to contest any such matter at the request of Guarantor, Guarantor agrees

to indemnify and hold harmless the Class B Purchasers from all costs and

expenses (including, without limitation, attorneys’ fees) related to such

request.

 

Section

15.            No Waiver, Amendments, Etc.  No failure on the part of the Class B Purchasers

to exercise, no delay in exercising and no course of dealing with respect to,

any right hereunder shall operate as a waiver thereof; nor shall any single or

partial exercise of any right hereunder preclude any other or further exercise

thereof or the exercise of any other right. The remedies herein provided are

cumulative and not exclusive of any remedies provided by law.  This Guaranty may not be amended or modified

except by written agreement between the Guarantor and the Class B Purchasers

and no consent or waiver hereunder shall be valid unless in writing and

executed in accordance with the provisions of this Guaranty.

 

Section

16.            Compromise and Settlement.  No compromise, settlement, release, renewal,

extension, indulgence, change in, waiver or modification of any of the terms of

the Guaranteed Indebtedness or the release of Guarantor or discharge of Issuer

or Guarantor from the performance of any of the terms of the Guaranteed

Indebtedness shall release or discharge Guarantor from this Guaranty.

 

6

 

Section

17.            Insolvency.  The voluntary or involuntary liquidation,

dissolution, sale or other disposition of all or substantially all the assets

and liabilities, receivership, insolvency, bankruptcy, assignment for the

benefit of creditors, reorganization, or other proceeding affecting Issuer or

Guarantor or the disaffirmance of the Class A Notes, the Class B Notes or the

Indenture, or Guarantor’s obligations hereunder in any such proceeding shall

not release or discharge Guarantor from this Guaranty.

 

Section

18.            Expenses.  In addition to its guaranty hereunder of the

Guaranteed Indebtedness, Guarantor hereby agrees to pay all costs and expenses,

including, without limitation, attorneys’ fees, paid or incurred by the Class B

Purchasers in collection or enforcing any or all of the Guaranty Amount or in

connection with the enforcement of this Guaranty and in which the Class B

Purchasers are the prevailing party.

 

Section

19.            Entire Agreement.  This Guaranty and all documents mentioned or

contemplated herein constitute and contain the entire agreement of the parties

and supersede any and all prior and contemporaneous agreements, negotiations,

correspondence, understandings and communications between the parties, whether

written or oral, respecting the subject matter hereof.

 

Section

20.            Severability.  If any provision of this Guaranty is held to

be unenforceable for any reason, it shall be adjusted, if possible, rather than

voided in order to achieve the intent of the parties to the extent possible. In

any event, all other provisions of this Guaranty shall be deemed valid and

enforceable to the full extent possible.

 

Section

21.            Subordination of

Indebtedness.  Any

Indebtedness or other obligation of Issuer now or hereafter held by or owing to

Guarantor is hereby subordinated in time and right of payment to all

obligations of Issuer to the Class B Purchasers; and such Indebtedness of

Issuer to Guarantor is assigned to the Class B Purchasers, as collateral

security for this Guaranty and the Guaranteed Indebtedness, and if the Class B

Purchasers so request, shall be collected, enforced and received by Guarantor

in trust for the Class B Purchasers, and be paid over to the Class B

Purchasers, on account of the Outstanding Obligations of Issuer to the Class B

Purchasers, but without reducing or affecting in any manner the liability of

Guarantor under the other provisions of this Guaranty. Any notes now or

hereafter evidencing such Indebtedness of Issuer to Guarantor shall be marked

with a legend that the same are subject to this Guaranty and shall be delivered

to the Class B Purchasers.  Guarantor

will, and the Deal Agent is hereby authorized, in the name of Guarantor from

time to time, to execute and file financing statements and continuation

statements and execute such other documents and take such other action as Deal

Agent deems necessary or appropriate to perfect, preserve and enforce its

rights hereunder.  Notwithstanding the foregoing,

the right of the Servicer to receive the Servicing Fee and receive

reimbursement of Servicer Advances is not subordinated except as may be

provided in Section 3.2 of the Series 2002-1 Supplement.

 

Section

22.            No Petition.  Guarantor hereby covenants that it will not

institute against the Issuer any bankruptcy, reorganization, arrangement,

insolvency or liquidation proceedings, or other proceedings under any federal

or state bankruptcy or similar law, at any time other than on a date which is

at least one year and one day after the last date on which any Note under any

Series was Outstanding.

 

7

 

Section

23.            Assignment; Governing Law.  This Guaranty shall be binding upon and

inure to the benefit of Guarantor and the Class B Purchasers and each of their

respective successors and assigns, except that Guarantor shall not have the

right to assign its rights hereunder or any interest herein unless authorized

by a writing executed by the Class B Purchasers. The Guarantor hereby consents

(a) to the Class B Purchasers enforcing their rights and remedies hereunder

and/or any other Owner or (b) to the assignment of all of the Class B

Purchasers rights and remedies hereunder to any subsequent Noteholder or to the

trustee under the Indenture. This Guaranty shall be governed by, and construed

in accordance with, the laws of the State of New York, without regard to the

conflicts of laws principles of such jurisdiction.

 

Section

24.            Consent to Jurisdiction.  Guarantor hereby irrevocably consents to the

non-exclusive personal jurisdiction o f the state and federal courts located in

New York County, New York, solely for purposes of any action, claim or other

proceeding arising out of any dispute in connection with this Guaranty, any

rights or obligations hereunder or thereunder or the performance of such rights

and obligations.  Guarantor hereby

irrevocably consents to the service of a summons and complaint and other

process in any action, claim or proceeding brought by the Class B Purchasers in

connection with this Guaranty, any rights or obligations hereunder or

thereunder or the performance of such rights and obligations, on behalf of

itself or its property, in the manner specified in Section 13 above.  Nothing in this Section 24 shall affect the

right of the Class B Purchasers to serve legal process in any other manner

permitted by applicable law or affect the right of the Class B Purchasers to

bring any action or proceeding against Guarantor or its properties in the

courts of any other jurisdictions.

 

Section

25.            Termination of Guaranty.  This Guaranty shall terminate upon payment

in full of the Class B Notes and fulfillment of all other Guaranteed

Indebtedness in full; provided, however, this Section shall not affect the

obligations of Guarantor pursuant to Section 14 of this Guaranty.

 

Section

26.            Waiver of Jury Trial.  THE GUARANTOR AND THE CLASS B PURCHASERS

HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT

TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION

WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE

PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.

 

Section

27.            Waiver of Specific Rights.

GUARANTOR HEREBY IRREVOCABLY WAIVES AND RELEASES ANY AND ALL RIGHTS IT MAY HAVE

AT ANY TIME (WHETHER ARISING DIRECTLY OR INDIRECTLY, BY OPERATION OF LAW,

CONTRACT OR OTHERWISE) TO REQUIRE THE MARSHALING OF ANY ASSETS OF ISSUER, WHICH

RIGHT OF MARSHALING MIGHT OTHERWISE ARISE FROM ANY SUCH PAYMENTS MADE OR

OBLIGATIONS PERFORMED.

 

Section

28.            Subordination of Specific

Rights.  Guarantor

hereby agrees that for so long as the Guaranteed Indebtedness is outstanding,

it shall not take any action to enforce any claim, right or remedy which

Guarantor may have against Issuer that arises hereunder, including without

limitation any claim, remedy or right of subrogation, reimbursement,

exoneration, or 

 

8

 

indemnification.

Guarantor further agrees that any claim, right or remedy which Guarantor may

have against Issuer that arises hereunder, including without limitation any

claim, remedy or right of subrogation, reimbursement, exoneration,

orindemnification, shall be subordinated to the prior payment of the Guaranteed

Indebtedness.

 

Section

29.            Transfer.  In the event of any transfer of any Class B

Note, all rights of the transferor of such Class B Note under this Guaranty in

respect of such Class B Note shall, once the transferee of such Class B Note

has become the registered Holder of such Class B Note, shall be assigned to,

and shall be enforceable by, such transferee.

 

Section

30.            General Interpretive

Principles.  For

purposes of this Guaranty except as otherwise expressly provided or unless the

context otherwise requires:

 

A.            the

terms defined in this Guaranty have the meanings assigned to them in this

Guaranty and include the plural as well as the singular, and the use of any

gender herein shall be deemed to include the other gender;

 

B.            accounting

terms not otherwise defined herein have the meanings assigned to them in

accordance with Generally Accepted Accounting Principles as in effect on the

date hereof;

 

C.            references

herein to “Sections”, “Subsections”, “paragraphs”, and other subdivisions

without reference to a document are to designated Sections, Subsections,

paragraphs and other subdivisions of this Guaranty;

 

D.            a

reference to a Subsection without further reference to a Section is a reference

to such Subsection as contained in the same Section in which the reference

appears, and this rule shall also apply to paragraphs and other subdivisions;

 

E.             the

words “herein”, “hereof’, “hereunder” and other words of similar import refer

to this Guaranty as a whole and not to any particular provision; and

 

F.             the

term “include” or “including” shall mean without limitation by reason of

enumeration.

 

[The Remainder of this

Page is Intentionally left Blank]

 

9

 

IN WITNESS WHEREOF, Guarantor has executed

and delivered this Guaranty as of the date first written above.

 

	

   

  	

  WILLIS LEASE

  FINANCE CORPORATION

  
	

   

  	

  as Guarantor

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ DONALD A. NUNEMAKER

  	

   

  
	

   

  	

   

  	

  Name: Donald A. Nunemaker

  
	

   

  	

   

  	

  Title: Executive Vice President,

  
	

   

  	

   

  	

  Chief Operating Officer

  
					

 

	

  ACCEPTED AND AGREED TO:

  
	

   

  
	

  BARCLAYS BANK PLC

  
	

  as Deal Agent

  and as a a Class B Purchaser

  
	

   

  
	

   

  
	

  By:

  	

  /s/ PIERRE DULEYRIE

  	

   

  
	

   

  	

  Name: Pierre Duleyrie

  
	

   

  	

  Title: Director

  
	

   

  
	

  FORTIS BANK (NEDERLAND) N.V.

  
	

  as a Class B

  Purchaser

  
	

   

  
	

   

  
	

  By:

  	

   

  	

   

  
	

   

  	

  Name:

  
	

   

  	

  Title:

  
							

 

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