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agreement_19.md | (i) The rights of any users of the Aircraft are subject and subordinate to all terms of the
Lease and all rights of Lessor in and to the Aircraft and under the Lease including, without
limitation, the right of Lessor to inspect and take possession of the Aircraft from time to time
according to the terms and provisions of the Lease and applicable law;
(ii) Lessee acknowledges that Lessor shall have none of Lessee’s obligations or duties with
respect to the Aircraft contained in any charter arrangement, including but not limited to
maintenance, repairs, service or insurance;
(iii) Lessee shall maintain accurate and complete records of all charter operations in which
the Aircraft is used, including without limitation copies of all receipts and invoices relating to
any such operations; and (ii) make any and all such records fully available to both Lessor and any
governmental agency (including, without limitation any state or federal taxing authority) promptly
upon demand from any such parties;
(iv) Lessee currently has, and will maintain all required Federal Aviation Administration
(**“FAA”**) licenses to operate a chartering company and to perform all of its obligations thereunder.
Lessee shall at all times maintain a Certificate pursuant to Part 135 of the FAA Regulations. The
Aircraft shall not be used for any pilot training activities except recurrent training for Lessee’s
and Lessee’s affiliates’ pilots who will be flying the Aircraft. Lessee shall at all times
maintain **“operational control,”** (as defined in the FAA Regulations) of the Aircraft;
(v) Any default by Lessee under the Lease shall constitute a default under the
chartering arrangements; | 400 |
agreement_19.md | (v) Any default by Lessee under the Lease shall constitute a default under the
chartering arrangements;
(vi) Lessee agrees that the Aircraft shall not be used by any governmental entity, any tax
exempt entity or any person or entity that would cause any Loss of, or otherwise adversely affect
any of, Lessor’s Tax Benefits in the Aircraft; and
(vii) Lessee shall not allow the use of the Aircraft in violation of the Lease.
Notwithstanding anything contained in this Lease to the contrary, so long as Lessee is not in
default hereunder, Lessee may replace parts and the engines on the Aircraft in accordance with its
customary arrangements with Turbomeca, its other maintenance service providers or its customary
business practices so long as (i) the replacement part or engine shall be the same make and model
and have the same or better fair market value as the part or engine being replaced (assuming such
engine or part had been maintained in accordance with the provisions hereof and has not experienced
any damage or other casualty event) (a “Replacement Engine” or a “Replacement Part”, as the case
may be), (ii) with respect to any Replacement Engine, Lessor shall acquire title to such
Replacement Engine which may occur pursuant to a limited assignment of such customary arrangements
with Turbomeca and Lessee shall have made all appropriate filings to protect Lessor’s interest in
the replacement engines with the FAA, the UCC and if the Cape Town Convention on International
Interests in Mobile Equipment (the “Convention”) and the Protocol thereto On Matters Specific To
Aircraft Equipment (the “Protocol”) concluded in Cape Town in November 2001 (the Convention and | 401 |
agreement_19.md | the Protocol, each, in the official English language text thereof, are collectively referred to
herein as the “Cape Town Convention”) comes into force prior to the effectiveness of such
replacement an AC Form 8050-135 FAA Entry Point Filing Form International Registry for filing with
the FAA and the international registry (the “International Registry”) established pursuant to the
Cape Town Convention and any other form proscribed by the International Registry or the FAA, and
(iii) with respect to any Replacement Part, Lessor shall have acquired title thereto which will
vest automatically upon installation of such Replacement Part in the Aircraft. Upon the
acquisition of title by Lessor to any such Replacement Engine or Replacement Part, as the case may
be, together with the fulfillment of all Lessee’s obligations set forth in this paragraph, this
Lease shall terminate with respect to any engine or part being so replaced by such Replacement
Engine or Replacement Part, as the case may be, and title thereto shall be conveyed by Lessor, at
the sole cost and expense of Lessee, to Lessee on an AS IS BASIS, without representation or
warranty of any kind, other than the absence of liens created by or though Lessor. | 402 |
agreement_19.md | (b) Lessor and any assignee of Lessor may assign this Lease, or any part hereof and/or the
Aircraft to any person or entity so long as (A) (x) such person or entity or its affiliates is
either not operating in the same line of business as Lessee or (y) such person or entity is a
financial institution or an insurance company having a tangible net worth at least equal to
$50,000,000 and (B) such person or entity is not in material litigation with Lessee as disclosed in
Guarantor’s most recent public filings on Form 10-Q or Form 10-K, as the case may be (and/or any
filing on Form 8-K filed after the date of such most recent Form 10-Q or Form 10-K, as the case may
be). Lessee hereby waives and agrees not to assert against any such assignee, or assignee’s
assigns, any defense, set-off, recoupment claim or counterclaim which Lessee has or may at any time
have against Lessor for any reason whatsoever. Lessee agrees that if Lessee receives written
notice of an assignment from Lessor, Lessee will pay all rent and all other amounts payable under
this Lease to such assignee or as instructed by Lessor. Lessee also agrees to confirm in writing
receipt of the notice of assignment as may be reasonably requested by assignee and shall cooperate
with Lessor and any such assignee in delivering to such assignee a certificate of insurance
reflecting assignee as loss payee and additional insured. | 403 |
agreement_19.md | **9. LOSS, DAMAGE AND STIPULATED LOSS VALUE:** Lessee hereby assumes and shall bear the entire risk of
any loss, theft, confiscation, expropriation, requisition, damage to, or destruction of, the
Aircraft, any engine or part thereof from any cause whatsoever, including without limitation,
intentional criminal acts and acts of terrorism. If for any reason the Aircraft, or any engine
thereto becomes worn out, lost, stolen, confiscated, expropriated, requisitioned, hijacked,
destroyed, irreparably damaged, or unusable (**“Casualty Occurrences”)** Lessee shall promptly and
fully notify Lessor in writing. If, in the opinion of Lessor, a Casualty Occurrence has occurred
which affects only the engine(s) of the Aircraft, then Lessee, at its own cost and expense, shall
replace such engine(s) with a Replacement Engine(s) or other engine acceptable to Lessor and shall
cause title to such Replacement Engine(s) or engine to be transferred to Lessor for lease to Lessee
under this Lease. Upon transfer of title to Lessor of such engine(s), such engine(s) shall be
subject to the terms and conditions of this Lease, and Lessee shall execute whatever documents or
filings Lessor deems necessary and appropriate in connection with the substitution of such
replacement engine(s) for the original engine(s). If, in the opinion of Lessor, a Casualty
Occurrence has occurred with respect to the Aircraft in its entirety, on the Rent Payment Date no
later than ninety (90) days after a Casualty Occurrence (the **“Payment Date”**), Lessee shall pay
Lessor the sum of (i) the Stipulated Loss Value as set forth in Annex F calculated as of the Rent | 404 |
agreement_19.md | Lessor the sum of (i) the Stipulated Loss Value as set forth in Annex F calculated as of the Rent
Payment Date prior to such Casualty Occurrence; and (ii) all Rent and other amounts which are due
under this Lease as of the Payment Date. In the event Lessor receives insurance proceeds after
receipt in full of the amounts set forth in clause (i) and (ii) in the foregoing sentence, Lessor
shall refund to Lessee the all amounts received from Lessee in respect of Stipulated Loss Value up
to the amount of the insurance proceeds Lessor actually received. Upon payment of all sums due
hereunder, the Term of this Lease as to the Aircraft shall terminate and Lessee shall have no
further right to use or operate the Aircraft. | 405 |
agreement_19.md | **10. INSURANCE:** Lessee shall secure and maintain in effect at its own expense throughout the Term
of the Lease insurance against such hazards and for such risks as Lessor may require; provided that
Lessor shall not require insurance in greater amounts or covering additional risks with respect to
the Aircraft than Lessor generally requires of its lessees to whom it leases similar aircraft.
All such insurance shall be with companies with a AM Best rating of “A” or better or otherwise
satisfactory to Lessor. Without limiting the generality of the foregoing, Lessee shall maintain
(i) liability insurance covering public liability and property, cargo and sudden accidental
pollution coverage, in amounts not less than fifty million (50,000,000) United States dollars for
any single occurrence; (ii) all-risk aircraft hull and engine insurance (including, without
limitation, with respect to engine or part thereof while removed from the aircraft and foreign
object damage insurance) in an amount which is not less than the then Stipulated Loss Value; and
(iii) confiscation, expropriation and war risk, hijacking and allied perils insurance (which
insurance shall include coverage against acts of terrorism and similar criminal acts) in an amount
which is (x) for physical damage, not less than the then Stipulated Loss Value and (y) for
liability coverage, not less than fifty million (50,000,000) United States dollars for any single
occurrence. All insurance shall: (1) name Lessor as owner of the Aircraft and as loss payee and
additional insured (without responsibility for premiums), (2) provide that any cancellation or
substantial change in coverage shall not be effective as to the Lessor for thirty (30) days (ten | 406 |
agreement_19.md | substantial change in coverage shall not be effective as to the Lessor for thirty (30) days (ten
(10) days in the event of non-payment of premiums, seven (7) days in the case of war risks
coverage) after receipt by Lessor of written notice from the insurer of such cancellation or
change, (3) insure Lessor’s interest regardless of any breach of warranty or other act or omission
of Lessee, (4) include a | 407 |
agreement_19.md | severability of interest clause providing that such policy shall operate in the same manner as if
there were a separate policy covering each insured, (5) waive any right of set-off against Lessee
or Lessor, and any rights of subrogation against Lessor, and (6) be primary and not be subject to
any offset by any other insurance carried by Lessor or Lessee. Lessee hereby appoints Lessor as
Lessee’s attorney-in-fact to make proof of loss and claim for and to receive payment of and to
execute or endorse all documents, checks or drafts in connection with all policies of insurance in
respect of the Aircraft. Lessor shall not act as Lessees attorney-in-fact until the occurrence and
during a continuation of an Event of Default or any incipient default under Sections 12(a)(i),
(vii) or (viii). Lessee shall pay any reasonable expenses of Lessor in adjusting or collecting
insurance proceeds. Lessor shall pay proceeds of any insurance claim in an amount not exceeding
five hundred thousand ($500,000) \_ United States dollars to Lessee and Lessee shall, as promptly as
practicable, repair the Aircraft or repair or replace any part thereof. Lessor may, at its option,
apply proceeds of insurance with respect to claims in excess of five hundred thousand ($500,000) United States dollars , in whole or in part, to (A) repair the Aircraft, or repair or replace any
part thereof, or (B) satisfy any obligation of Lessee to Lessor due under this Lease.
| | | |
| --- | --- | --- |
| **11.** | | **RETURN OF AIRCRAFT:** | | 408 |
agreement_19.md | (a) At
expiration or termination of this Lease (the **“Return
Date”**), Lessee shall return the
Aircraft to Lessor, at a location within the Gulf Coast region of the United States as Lessor shall
direct. Lessee shall also return all logs, loose equipment, manuals and data associated with the
Aircraft, including without limitation, inspection, modification and overhaul records required to
be maintained with respect to the Aircraft under this Lease or under the applicable rules and
regulations of the FAA or the manufacturer’s recommended maintenance program, along with a
currently effective FAA airworthiness certificate. Lessee shall, upon request, assign to Lessor
its rights under any manufacturer’s maintenance service contract or extended warranty for the
Aircraft, any engine or part thereof. The Aircraft shall be returned in the condition in which the
Aircraft is required to be maintained pursuant to Section 7, but with all logos or other
identifying marks of Lessee removed. Additionally, Lessee shall ensure that the Aircraft complies
with all requirements and conditions set forth on Annex G hereto. Lessee shall pay for all costs
to comply with this Section 11(a). | 409 |
agreement_19.md | (b) Lessor shall arrange for the inspection of the Aircraft on the Return Date to determine if
the Aircraft has been maintained and returned in accordance with the provisions of this Lease.
Lessee shall be responsible for the cost of such inspection and shall pay Lessor such amount as
additional Rent within ten (10) days of demand. If the results of such inspection indicate that
the Aircraft, any engine thereto or part thereof, has not been maintained or returned in accordance
with the provisions of this Lease, Lessee shall pay to Lessor within ten (10) days of demand, as
liquidated damages, the estimated cost (**“Estimated Cost”)** of servicing or repairing the Aircraft,
engine or part. The Estimated Cost shall be determined by Lessor by obtaining two quotes for such
service or repair work, with one quote selected by Lessee reasonably acceptable to Lessor and one
quote selected by Lessor reasonably acceptable to Lessee and taking their average. Lessee shall
bear the cost, if any, incurred by Lessor in obtaining such quotes.
(c) If Lessee fails to return the Aircraft on the Return Date, Lessor shall be entitled to
damages equal to the higher of (i) the Rent for the Aircraft, pro-rated on a per diem basis, for
each day the Aircraft is retained beyond the Return Date; or (ii) the daily fair market rental for
the Aircraft at the Return Date. Such damages for retention of the Aircraft after the Return Date
shall not be interpreted as an extension or reinstatement of the Term.
(d) All of Lessor’s rights contained in this Section shall survive the expiration or other
termination of this Lease.
| | | |
| --- | --- | --- |
| **12.** | | **EVENTS OF DEFAULT AND REMEDIES:** | | 410 |
agreement_19.md | (a) Lessee shall be in default under this Lease and each of the other Documents (as that term
is defined in Section 16 below) upon the occurrence of any of the following “Events of Default”:
(i) Lessee breaches its obligation to pay Rent or any other sum when due and fails to cure the
breach within ten (10) days of written invoice from Lessor; (ii) Lessee breaches any of its
insurance obligations under Section 10; (iii) Lessee breaches any of its other obligations in any
material respect and fails to cure that breach within thirty (30) days after written notice from
Lessor to Lessee; (iv) any representation or warranty made by Lessee in connection with this Lease
or Bill of Sale, or Guarantor in connection with the Guaranty agreement shall be false or
misleading in any material respect; (v) Lessee or Guarantor or other obligor for any of the
obligations hereunder (collectively “**Guarantor**”), dissolves, terminates its existence, becomes
insolvent or ceases to do business as a going concern; (vi) the Aircraft or any other property of
Lessee is illegally used, confiscated, sequestered, seized or levied upon; (vii) a receiver is
appointed for all or of any part of the property of Lessee or any Guarantor, or Lessee or any
Guarantor makes any assignment for the benefit of creditors; (viii) a petition is filed by or
against Lessee or any Guarantor under any bankruptcy, insolvency or similar laws and in the event
of an involuntary petition, the petition is not dismissed within sixty (60) days of the filing
date; (ix) the occurrence of any “Event of Default” under any Aircraft Lease Agreement dated as of | 411 |
agreement_19.md | date; (ix) the occurrence of any “Event of Default” under any Aircraft Lease Agreement dated as of
even date herewith between Lessor and Lessee (the “Related Leases”); (x) any Guarantor revokes or
attempts to revoke its | 412 |
agreement_19.md | guaranty or fails to observe or perform any covenant, condition or agreement to be performed under
any guaranty or other related document to which it is a party, (xi) Lessee is declared in default
under any contract or obligation requiring the payment of money in a principal amount outstanding
greater than $10,000,000.00; (xii) there is any dissolution, or termination of existence of the
Lessee or Guarantor, or change in controlling ownership of Lessee (meaning Guarantor fails to own
directly or indirectly more than 50% of the voting equity of the Lessee) or any Guarantor Change of
Control (as defined in Annex H herein) has occurred or (xiii) there is any merger or consolidation
of Guarantor or Lessee in violation of this Lease. | 413 |
agreement_19.md | (b) Upon the occurrence of any Event of Default and so long as the same shall be continuing,
Lessor may, at its option, at any time thereafter, exercise one or more of the following remedies,
as Lessor in its sole discretion shall lawfully elect: (i) demand that Lessee immediately pay as
liquidated damages, for loss of a bargain and not as a penalty, an amount equal to (x) the
Stipulated Loss Value of the Aircraft, computed as of the Basic Term Rent Date prior to such demand
together with (y) all Rent and other amounts due and payable for all periods up to and including
the Basic Term Rent Date following such demand; (ii) demand that Lessee pay all amounts due for
failure to maintain or return the Aircraft as provided herein and cause Lessee to assign to Lessor
Lessee’s rights under any manufacturer’s service program contract or any extended warranty contract
in force for the Aircraft; (iii) proceed by appropriate court action, either at law or in equity,
to enforce the performance by Lessee of the applicable covenants of this Lease or to recover
damages for breach hereof; (iv) by notice in writing terminate this Lease, whereupon all rights of
Lessee to use of the Aircraft or any part thereof shall absolutely cease and terminate, and Lessee
shall immediately return the Aircraft in accordance with Section 11, but Lessee shall remain liable
as provided in Section 11; (v) request Lessee to return the Aircraft to a designated location in
accordance with Section 11; (vi) peacefully enter the premises where the Aircraft may be and take
possession of the Aircraft; (vii) sell or otherwise dispose of the Aircraft at private or public | 414 |
agreement_19.md | possession of the Aircraft; (vii) sell or otherwise dispose of the Aircraft at private or public
sale, in bulk or in parcels, with or without notice, and without having the Aircraft present at the
place of sale; (viii) lease or keep idle all or part of the Aircraft; (ix) use Lessee’s premises
for storage pending lease or sale or for holding a sale without liability for rent or costs for
five (5) months; (x) collect from Lessee all actual out-of-pocket costs, charges and expenses,
including reasonable legal fees and disbursements, incurred by Lessor by reason of the occurrence
of any Event of Default or the exercise of Lessor’s remedies with respect thereto; (xi) draw on any
Acceptable Letter of Credit, foreclose on any Additional Collateral or Security Deposit Pledge (as
each such term is defined in the Additional Collateral Agreement, dated as of even date herewith,
between Lessor and Lessee); and/or (xii) declare any Event of Default under the terms of this Lease
to be a default under the Related Leases or any other agreement for borrowed money between Lessor
(and/or General Electric Capital Corporation) on the one hand, and Lessee or Guarantor (or any of
their affiliates or parent entities) on the other hand. | 415 |
agreement_19.md | (c) Lessor shall apply any proceeds of sale, lease or other disposition of the Aircraft or any
other collateral, letter of credit or deposit, if any, and shall have the right to apply same in
the following order of priorities: (i) to pay all of Lessor’s costs, charges and expenses incurred
in enforcing its rights under this Lease or in taking, removing, holding, repairing, selling,
leasing or otherwise disposing of the Aircraft; then, (ii) to the extent not previously paid by
Lessee, to pay Lessor all sums due from Lessee under this Lease or any other Related Lease in any
priority as Lessor determines; then (iii) to reimburse to Lessee any sums previously paid by Lessee
representing Stipulated Loss Value as liquidated damages pursuant to Section 12(b)(i)(x); and (iv)
any surplus shall be retained by Lessor. Lessee shall immediately pay on demand any deficiency in
(i) and (ii) of the immediately preceding sentence. Lessor’s obligation hereunder shall survive
any termination of this Lease.
(d) The foregoing remedies are cumulative, and any or all thereof may be exercised instead of
or in addition to each other or any remedies at law, in equity, or under statute. Waiver of any
Event of Default shall not be a waiver of any other or subsequent Event of Default. | 416 |
agreement_19.md | (e) Upon the indefeasible payment in full of all amounts owed to Lessor after an Event of
Default (including, without limitation, all accrued Rent, actual out-of-pocket costs and expenses
(including attorney’s fees), indemnity payments and any other sums due and owing hereunder) and, if
so elected by Lessor, delivery of the Aircraft meeting the requirements of Section 11 (provided
that the proceeds thereof shall be applied as set forth in Section 12(c)), this Lease shall
terminate and neither Lessor nor Lessee shall have no further obligations under the Lease, except
with respect to obligations which by the terms of this Lease survive the termination hereof.
| | | |
| --- | --- | --- |
| **13.** | | **NET LEASE:** |
This Lease is a net lease. The Lessor shall have no obligation, liability or responsibility
to the Lessee or any other person with respect to operation, maintenance, repairs, alterations,
modifications, correction of faults or defects (whether or not required by applicable law) or
insurance with respect to the Aircraft, all of which matters shall be, as between Lessor and
Lessee, the sole responsibility of Lessee, regardless of upon whom such responsibilities may fall
under applicable law or otherwise, and the Rent payable hereunder has been set in reliance upon the
Lessee’s sole responsibility for all such matters. The Lessee acknowledges and agrees that its
obligations to pay Rent and all other amounts due and owing in accordance with the terms hereof
shall be absolute and unconditional and shall not be released, discharged, waived, reduced, set-off
or affected | 417 |
agreement_19.md | by any circumstance whatsoever. Lessor and Lessee agree that the foregoing shall not operate as a
waiver of any claim for breach Lessee may have against Lessor.
| | | |
| --- | --- | --- |
| **14.** | | **INDEMNIFICATION:** | | 418 |
agreement_19.md | (a) Lessee hereby agrees to indemnify (on an after tax basis) Lessor and any other entity
which has an ownership interest in, is owned by or is under common ownership with, Lessor, and the
respective or collective officers, directors, agents, employees, successors and assigns of each
(each, an **“Indemnified Party”**) from and against any and all losses, damages, penalties, injuries,
claims, demands, actions and suits, (collectively
**“Claims”**) whether in law or equity, or in
contract, tort, or otherwise, including reasonable attorneys’ fees and disbursements and other
costs of investigation or defense, including those incurred upon any appeal arising out of or
relating to the Aircraft or this Lease and shall include, but is not limited to, Lessor’s strict
liability in tort and Claims that may be imposed on, incurred by or asserted against an Indemnified
Party in any way arising out of (i) the selection, manufacture, purchase, acceptance or rejection
of the Aircraft, the ownership of the Aircraft during the term of this Lease, and the delivery,
lease, possession, maintenance, uses, condition, return or operation of the Aircraft (including,
without limitation, latent and other defects, whether or not discoverable by Lessor, any
Indemnified Party or Lessee and any claim for patent, trademark or copyright infringement or
environmental damage); (ii) any breach of Lessee’s obligations under the Lease or the failure by
Lessee to comply with any term, provision or covenant contained in this Lease or any other
agreement executed by Lessee in connection with this Lease or the Aircraft or with any applicable
law, rule or regulation with respect to the Aircraft, or the nonconformity of the Aircraft or its | 419 |
agreement_19.md | law, rule or regulation with respect to the Aircraft, or the nonconformity of the Aircraft or its
operation with any applicable law; (iii) vandalism, hijacking, destruction, bombing, terrorism or
similar acts directly or indirectly affecting the Aircraft, any part thereof, or any persons who
(whether or not on board the Aircraft) may sustain any injury or damage as a result of any such
acts, regardless of whether or not Lessee was at the time of such use, complying with the security
requirements of the Lease or applicable law; (iv) any actions brought against any Indemnified Party
that arise out of Lessee’s actions (or actions of Lessee’s agents); or (v) any Indemnified Party’s
reliance on any representation or warranty made or deemed made by Lessee or Guarantor (or any of
their officers) under or in connection with this Lease or any other Document or any report or other
information delivered by Lessee or Guarantor pursuant hereto which shall have been incorrect in any
material respect when made or deemed made or delivered; provided, that Lessee shall not be
obligated to pay and shall have no indemnity liability for any Claims (x) imposed on or against an
Indemnified Party to the extent that such Claims are caused by the gross negligence or willful
misconduct of such Indemnified Party or (y) to the extent imposed with respect to any Claim solely
based on events occurring after the earlier of (A) the expiration or other termination of the Term
in circumstances not requiring the return of the Aircraft and payment in full of all amounts due
from Lessee under this Lease and any other Document and (B) the satisfaction by Lessee of all its
obligations under Section 11 of the Lease and payment in full of all amounts due from Lessee under | 420 |
agreement_19.md | obligations under Section 11 of the Lease and payment in full of all amounts due from Lessee under
this Lease and any Document . Lessee shall pay on demand to each Indemnified Party any and all
amounts necessary to indemnify such Indemnified Party from and against any of the foregoing.
Lessee shall, upon request, defend any actions based on, or arising out of, any of the foregoing. | 421 |
agreement_19.md | (b) Lessee and Lessor agree that, as of the Commencement Date, (i) is the intent of the
parties that Lessor is the owner of the Aircraft for state law and federal income tax purposes,
(ii) Lessor intends to take depreciation deductions with respect to the Aircraft in accordance with
Section 168 of the Internal Revenue Code of 1986, as amended, as set forth on Annex B (**“Tax
Benefits”**), (iii) it is the intent of the parties that the Aircraft leased under the Lease shall
qualify for all tax deductions in the hands of Lessor, and (iv) at no time during the Term of this
Lease will Lessee take or omit to take, nor will it permit any sublessee or assignee to take or
omit to take, any action (whether or not such act or omission is otherwise permitted by Lessor
unless expressly permitted by this Lease), which will result in the disqualification of the
Aircraft for, or recapture of, all or any portion of such Tax Benefits. | 422 |
agreement_19.md | (c) If as a result of a breach of any representation, warranty or covenant of the Lessee
contained in this Lease (i) independent tax counsel selected by Lessor and reasonably acceptable to
Lessee shall determine that Lessor is not entitled to claim on its Federal income tax return all or
any portion of the Tax Benefits with respect to the Aircraft, or (ii) any Tax Benefit claimed on
the Federal income tax return of Lessor is disallowed or adjusted by the Internal Revenue Service,
or (iii) any Tax Benefit is recalculated or recaptured (any determination, disallowance,
adjustment, recalculation or recapture being a “**Loss**”), then Lessee shall pay to Lessor, as an
indemnity and as additional rent, an amount that shall, in the reasonable opinion of Lessor, cause
Lessor’s after-tax economic yields and cash flows to equal the Net Economic Return that would have
been realized by Lessor if such Loss had not occurred. Such amount shall be payable within thirty
(30) days of written demand accompanied by a statement describing in reasonable detail such Loss
and the computation of such amount. The economic yields and cash flows shall be computed on the
same assumptions, including tax rates as were used by Lessor in originally evaluating the
transaction (**“Net Economic Return”**). If an adjustment has been made under Section 3 then the
Effective Rate used in the next preceding adjustment shall be substituted.
(d) Lessee hereby further represents, warrants and covenants that all amounts includible in
the gross income of Lessor with respect to the Aircraft, and all deductions or credits allowable to
Lessor with respect to the Aircraft, will be treated as derived from or allocable to sources | 423 |
agreement_19.md | within the United States in each and every year taxable year of Lessor throughout the entire term
of this Lease. If as a result of any breach of the representation, warranty and covenant contained
in the immediately preceding sentence, any item of income, credit or deduction with respect to the
Aircraft shall not be treated as derived from or allocable to, sources within the United States for
any taxable year of Lessor (any such event hereinafter referred to as a “**Foreign Loss**”), then
Lessee shall pay to Lessor as an indemnity, on the next succeeding rental payment date, or in any
event within 30 days after written demand to Lessee by Lessor, such amount as, after deduction of
all taxes required to be paid by Lessor in respect of the receipt of such amounts under the laws of
any federal, state or local government or taxing authority of the United States, shall equal the
sum of: (i) the excess of (x) the foreign tax credits which Lessor would have been entitled to for
such year had no such Foreign Loss occurred over (y) the foreign tax credits to which Lessor was
limited as a result of such Foreign Loss and (ii) the amount of any interest, penalties or
additions to tax payable as a result of such Foreign Loss. | 424 |
agreement_19.md | (e) Lessee shall not be obligated to pay any sums required in Section 14 in the event the
cause of the Loss results from one or more of the following events: (1) a failure of Lessor to
timely claim accelerated cost recovery (or depreciation) deductions for any Aircraft in Lessor’s
tax return, other than a failure resulting from Lessor’s determination, based on opinion of its
counsel or otherwise, that no reasonable basis exists for claiming accelerated cost recovery (or
depreciation) deductions, (2) a failure of Lessor to have sufficient gross income to benefit from
accelerated cost recovery (or depreciation) deductions, or (3) a change in the tax law applicable
to accelerated cost receovery (or depreciation) deductions disallows deductions to which Lessor
would otherwise be entitled unless such loss is caused by an act or omission of Lessee. Lessor
agrees to promptly notify Lessee of any claim made by any federal or state tax authority against
Lessor with respect to the disallowance of such accelerated cost recovery (or depreciation)
deductions, together with sufficient details (to the extent the information is available to Lessor)
of the nature of, or reasons for, the claim by such tax authority and Lessor’s position with
respect thereto (including a copy of any correspondence from the applicable taxing authority). All
references to Lessor in this Section 14 include Lessor and the consolidated taxpayer group of which
Lessor is a member.
(f) All of Lessor’s rights, privileges and indemnities contained in this Section 14 shall
survive the expiration or other termination of this Lease. The rights, privileges and indemnities
contained herein are expressly made for the benefit of, and shall be enforceable by Lessor, its
successors and assigns. | 425 |
agreement_19.md | | | | |
| --- | --- | --- |
| **15.** | | **DISCLAIMER:** | | 426 |
agreement_19.md | LESSEE ACKNOWLEDGES THAT IT HAS SELECTED THE AIRCRAFT WITHOUT ANY ASSISTANCE FROM LESSOR, ITS
AGENTS OR EMPLOYEES AND THAT LESSOR IS LEASING THE AIRCRAFT IN AN “AS IS” CONDITION. LESSOR DOES
NOT MAKE, HAS NOT MADE, NOR SHALL BE DEEMED TO MAKE OR HAVE MADE, ANY WARRANTY OR REPRESENTATION,
EITHER EXPRESS OR IMPLIED, WRITTEN OR ORAL, WITH RESPECT TO THE AIRCRAFT LEASED UNDER THIS LEASE OR
ANY COMPONENT THEREOF, OR ANY ENGINE INSTALLED THEREON, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY
AS TO CONDITION, AIRWORTHINESS, DESIGN, COMPLIANCE WITH SPECIFICATIONS, QUALITY OF MATERIALS OR
WORKMANSHIP, MERCHANTABILITY, FITNESS FOR ANY PURPOSE, USE OR OPERATION, SAFETY, PATENT, TRADEMARK
OR COPYRIGHT INFRINGEMENT, OR TITLE. All such risks, as between Lessor and Lessee, are to be borne
by Lessee. Without limiting the foregoing, Lessor shall have no responsibility or liability to
Lessee or any other person with respect to any of the following: (i) any liability, loss or damage
caused or alleged to be caused directly or indirectly by the Aircraft, any inadequacy thereof, any
deficiency or defect (latent or otherwise) of the Aircraft, or any other circumstance in connection
with the Aircraft; (ii) the use, operation or performance of the Aircraft or any risks relating to
it; (iii) any interruption of service, loss of business or anticipated profits or consequential
damages; or (iv) the delivery, operation, servicing, maintenance, repair, improvement or
replacement of the Aircraft. If, and so long as, no Event of Default has occurred and is | 427 |
agreement_19.md | replacement of the Aircraft. If, and so long as, no Event of Default has occurred and is
continuing under this Lease, Lessee shall be, and hereby is, authorized during the Term of this
Lease to assert and enforce, at Lessee’s sole cost and expense, in the name of and for the account
of Lessor and/or Lessee, as their interests may appear, whatever claims and rights Lessor may have
against any Supplier of the Aircraft. | 428 |
agreement_19.md | | | | |
| --- | --- | --- |
| **16.** | | **REPRESENTATIONS AND WARRANTIES OF LESSEE:** |
A. Lessee hereby represents and warrants to Lessor that on the date of this Lease :
(a) Lessee has adequate limited liability company power and capacity to enter into, and
perform under, this Lease and all related documents (together, the
**“Documents”**) and is duly
qualified to do business wherever necessary to carry on its present business and operations,
including the jurisdiction(s) where the Aircraft has its primary hangar location. | 429 |
agreement_19.md | (b) The Documents have been duly authorized, executed and delivered by Lessee and constitute
valid, legal and binding agreements, enforceable in accordance with their terms, except to the
extent that the enforcement of remedies may be limited under applicable bankruptcy, insolvency or
creditors’ rights generally laws and principles of equity.
(c) No approval, consent or withholding of objections is required from any governmental
authority or entity with respect to the entry into or performance by Lessee of the Documents except
such as have already been obtained.
(d) The entry into and performance by Lessee of the Documents will not: (i) violate any
judgment, order, law or regulation applicable to Lessee or any provision of Lessee’s Certificate of
Formation or Operating Agreement; or (ii) result in any breach of, constitute a default under or
result in the creation of any lien, charge, security interest or other encumbrance upon any
Aircraft pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement (other
than this Lease) to which Lessee is a party.
(e) There are no suits or proceedings pending or threatened in court or before any commission,
board or other administrative agency against or affecting Lessee, which will have a material
adverse effect on the ability of Lessee to fulfill its obligations under this Lease.
(f) The financial statements contained in Guarantor’s report on Form 10-K for fiscal year
ended March 31, 2005 delivered to Lessor has been prepared in accordance with generally accepted
accounting principles consistently applied, and since March 31, 2005, there has been no material
adverse change.
B. Lessee hereby: | 430 |
agreement_19.md | B. Lessee hereby:
(a) Represents and warrants that its exact legal name is as set forth in the first sentence of
this Lease and Lessee is and will be at all times validly existing and in good standing under the
laws of the State of its incorporation (specified in the first sentence of this Lease) and Lessee
is and will continue to be a **“Citizen of the United States”** within the meaning of Section 40102(15)
of the FAA. Lessee shall not consolidate, reorganize or merge with any other corporation or entity
(other than a wholly-owned subsidiary of Guarantor) or sell, convey, transfer or lease all or
substantially all of its property to any corporation or entity (other than a wholly-owned
subsidiary of Guarantor) during the Term of this Lease.
(b) Represents and warrants that its the chief executive office or chief place of
business (as either of such terms is used in Article 9 of the Uniform Commercial Code) of Lessee is
located at the address set forth above, and Lessee agrees to give Lessor prior written notice of
any relocation of said chief executive office or chief place of business from its present location.
(c) Agrees that a copy of this Lease, and a current and valid AC Form 8050-l will be kept on
the Aircraft at all times during the Term of this Lease.
(d) Represents and warrants that Lessee has selected the Aircraft, manufacturer and vendor
thereof, and all maintenance facilities required hereby.
(e) Covenants that it shall maintain all logs, books and records (including any computerized
maintenance records) pertaining to the Aircraft and engines and their maintenance during the Term
in accordance with FAA rules and regulations. | 431 |
agreement_19.md | (f) Represents and warrants that throughout the Term of this Lease, Lessee will not use or
operate and will not permit the Aircraft to be used or operated “predominately” outside the United
States as that phrase is used in Section 168(g)(1)(A) of the Code.
(g) Represents that it is and covenants that it will remain in material compliance with all
laws and regulations applicable to it including, without limitation, (i) ensuring that no person
who owns a controlling interest in or otherwise controls Lessee is or shall be (Y) listed on the
Specially Designated Nationals and Blocked Person List maintained by the Office of Foreign Assets
Control (“**OFAC**”), Department of the Treasury, and/or any other similar lists maintained by OFAC
pursuant to any authorizing statute, Executive Order or regulation or (Z) a person designated under
Section 1(b), (c) or (d) of Executive Order No. 13224 (September 23, 2001), any related enabling
legislation or any other similar Executive Orders, and (ii) compliance with all applicable Bank
Secrecy Act (“**BSA**”) laws, regulations and government guidance on BSA compliance and on the
prevention and detection of money laundering violations.
(h) Covenants that it shall duly qualify to do business in any jurisdiction(s) where the
Aircraft shall have its primary hangar location. | 432 |
agreement_19.md | | | | |
| --- | --- | --- |
| **17.** | | **EARLY TERMINATION:** |
(a) On or after the First Termination Date (specified in Annex B), Lessee may, so long as no
Event of Default or any event or occurrence which with the giving of notice or passage of time or
both would result in an Event of Default exists and continues under this Lease, terminate this Lease
as of a Rent Payment Date (**“Termination Date”**). Lessee must give Lessor at least ninety (90) days
prior written notice of the termination.
(b) Lessee shall, and Lessor may, solicit cash bids for the Aircraft on an AS IS, WHERE IS
basis without recourse to or warranty from Lessor, express or implied (other than the absence of
any liens created by or through Lessor) (**“AS IS BASIS”**). Prior to the Termination Date, Lessee
shall, (i) certify to Lessor any bids received by Lessee; and (ii) pay to Lessor, (a) the
Termination Value (calculated as of the Termination Date) for the Aircraft; and (b) all Rent and
other sums due and unpaid as of the Termination Date. Neither Lessee nor its agents shall be
permitted to bid. | 433 |
agreement_19.md | (c) If all amounts due hereunder have been paid on the Termination Date, Lessor shall (i) sell
the Aircraft on an AS IS BASIS for cash to the highest bidder; and (ii) refund the proceeds of such
sale (net of any related expenses) to Lessee up to the amount of the Termination Value paid by
Lessee. If such sale is not consummated, no termination shall occur and Lessor shall refund the
Termination Value (less any expenses incurred by Lessor) to Lessee.
(d) Notwithstanding the foregoing, Lessor may elect by written notice, at any time prior to
the Termination Date, not to sell the Aircraft. In that event, on the Termination Date Lessee
shall: (i) return the Aircraft (in accordance with Section 11); and (ii) pay to Lessor all amounts
required (x) under Section 17(b)(ii)(a) less the amount of the highest bid certified by Lessee to
Lessor and (y) under Section 17(b)(ii)(b).
(e) If Lessor exercises its rights to increase Lessee’s rental obligations under Section 3(a),
Lessee may, upon ninety (90) days notice and so long as no default exists under the this Lease,
terminate this Lease as of any Rent Payment Date
| | | |
| --- | --- | --- |
| **18.** | | **EARLY PURCHASE OPTION:** | | 434 |
agreement_19.md | (a) On the Early Purchase Option Date (specified in Annex B), Lessee may, so long as no Event
of Default or any event or occurrence which with the giving of notice or passage of time or both
would result in an Event of Default exists hereunder and this Lease has not been earlier
terminated, purchase the Aircraft on an AS IS BASIS for cash equal to the Early Purchase Option
Price (specified on Annex B), plus all applicable sales taxes. Lessee must give Lessor at least
thirty (30) days, but not more than ninety (90) days, prior written notice of the purchase. Lessor
and Lessee agree that the Option Price is a reasonable prediction of the price that a willing buyer
(who is neither a lessee in possession or a used aircraft dealer) would pay for the Aircraft on the
Early Purchase Option Date in an arm’s length transaction to a willing seller under no compulsion
to sell.
(b) If Lessee has elected to purchase the Aircraft, then on the Early Purchase Option Date
Lessee shall pay to Lessor the Early Purchase Option Price (plus all applicable sales taxes)
together with any Rent and other sums due and unpaid on the Early Purchase Option Date. Upon
receipt of indefeasible payment in full of such amounts by Lessor, Lessor shall convey all of its
right, title and interest in and to the Aircraft to Lessee on an AS IS BASIS without representation
or warranties of any kind, other than the absence of liens created by or through Lessor.
| | | |
| --- | --- | --- |
| **19.** | | **END OF LEASE PURCHASE OPTION:** | | 435 |
agreement_19.md | (a) On the Expiration Date (specified in Annex B), Lessee may, so long as no Event of Default
or any event or occurrence which with the giving of notice or passage of time or both would result
in an Event of Default exists hereunder and this Lease has not been earlier terminated, purchase
the Aircraft on an AS IS BASIS for cash equal to its then Fair Market Value (plus all applicable
sales taxes together with any Rent and other sums due and unpaid on the Expiration Date). Upon
receipt of indefeasible payment in full of such amounts by Lessor, Lessor shall convey all of its
right, title and interest in and to the Aircraft to lessee on an AS IS BASIS without representation
or warranties of any kind, other than the absence of liens created by or through Lessor. Lessee
must give Lessor at least ninety (90) days, but not more than one hundred eighty (180) days, prior
written notice of its intent to purchase. | 436 |
agreement_19.md | (b) **“Fair Market Value”** shall mean the price which a willing buyer (who is neither a lessee in
possession nor a used equipment dealer) would pay for the Aircraft in an arm’s-length transaction
to a willing seller under no compulsion to sell. In determining the Fair Market Value: (i) the
Aircraft shall be assumed to be in the condition in which it is required to be maintained and
returned under this Lease, (ii) any installed additions to the Aircraft shall be valued on an
installed basis; and (iii) costs of removal of the Aircraft from the current location shall not be
a deduction from the value of the Aircraft. If Lessor and Lessee are unable to agree on the Fair
Market Value at least sixty (60) days before Lease expiration, Lessor shall appoint an independent
appraiser (reasonably acceptable to Lessee) to determine Fair Market Value. The independent
appraisers determination shall be final, binding and conclusive. Lessee shall bear all costs
associated with any such appraisal.
(c) Lessee shall be deemed to have waived this purchase option unless it provides Lessor with
written notice of its irrevocable election to exercise the option within fifteen (15) days after
the Fair Market Value is told to Lessee.
| | | |
| --- | --- | --- |
| **20.** | | **MISCELLANEOUS:** | | 437 |
agreement_19.md | (a) LESSEE AND LESSOR HEREBY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A JURY TRIAL OF ANY CLAIM
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS LEASE, ANY OF THE RELATED DOCUMENTS, ANY
DEALINGS BETWEEN LESSEE AND LESSOR RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY
RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN LESSEE AND LESSOR.
THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT. THIS WAIVER IS IRREVOCABLE. THIS WAIVER MAY NOT BE MODIFIED EITHER ORALLY OR
IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS LEASE, ANY RELATED DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THIS TRANSACTION . THIS LEASE MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.
(b) The Aircraft shall remain Lessor’s property unless Lessee purchases the Aircraft from
Lessor, and until such time Lessee shall only have the right to use the Aircraft as a lessee. Any
cancellation or termination by Lessor of this Lease, pursuant to the provisions of this Lease,
shall not release Lessee from any then outstanding obligations to Lessor hereunder (unless
otherwise expressly stated herein). | 438 |
agreement_19.md | (c) Time is of the essence of this Lease. Lessee agrees, upon Lessor’s request, to execute,
or otherwise authenticate, any document, record or instrument necessary or expedient for filing,
recording or perfecting the interest of Lessor or to carry out the intent of this Agreement. In
addition, Lessee hereby authorizes Lessor to file a financing statement and amendments thereto
describing the Aircraft and any engines, attachments, appurtenances and parts relating thereto and
containing any other information required by the applicable Uniform Commercial Code. At the
request of Lessor following any expiration or termination of this Lease, Lessee shall execute and
deliver to Lessor, for filing with the FAA, such documents as Lessor shall require to evidence and
confirm the expiration or termination of this Lease and the release of the Aircraft from the terms
and conditions hereof, and if Lessee fails for any reason to execute and deliver such documents to
Lessor, Lessee hereby irrevocably authorizes Lessor to sign Lessee’s name to such documents and
file such documents with the FAA. Lessee hereby ratifies its prior authorization for Lessor to
file financing statements and amendments thereto describing the Aircraft and containing any other
information required by any applicable law (including without limitation the Uniform Commercial
Code) if filed prior to the date hereof. All notices required to be given hereunder shall be
deemed adequately given if delivered in hand or sent by registered or certified mail to the
addressee at its address stated herein, or at such other place as such addressee may have
designated in writing. This Lease together with the Annexes hereto constitute the entire agreement
of the parties with respect to the subject matter hereof, and all Annexes referenced herein are | 439 |
agreement_19.md | of the parties with respect to the subject matter hereof, and all Annexes referenced herein are
incorporated herein by reference. NO VARIATION OR MODIFICATION OF THIS LEASE OR ANY WAIVER OF ANY
OF ITS PROVISIONS OR CONDITIONS, SHALL BE VALID UNLESS IN WRITING AND SIGNED BY AN AUTHORIZED
REPRESENTATIVE OF EACH PARTY TO THIS LEASE. | 440 |
agreement_19.md | (d) If Lessee does not comply with any provision of this Agreement, Lessor shall have the
right, but shall not be obligated, to effect such compliance, in whole or in part. All reasonable
amounts spent and obligations incurred or assumed by Lessor in effecting such compliance shall
constitute additional Rent due to Lessor. Lessee shall pay the additional Rent within ten days
after the date Lessor sends an invoice to Lessee requesting payment. Lessor’s effecting such
compliance shall not be a waiver of any Event of Default.
(e) Any Rent or other amount not paid to Lessor when due shall bear interest from the due date
until paid, at the lesser of twelve percent (12%) per annum or the maximum rate allowed by law.
Any provisions in this Lease which are in conflict with any statute, law or applicable rule shall
be deemed omitted, modified or altered to conform thereto. Notwithstanding anything to the
contrary contained in this Lease, in no event shall this Lease require the payment or permit the
collection of amounts in excess of the maximum permitted by applicable law. | 441 |
agreement_19.md | (f) THIS LEASE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL IN ALL RESPECTS
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CONNECTICUT
(WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE AIRCRAFT.
(g) This Lease may be executed in any number of counterparts, all of which taken together
shall constitute one and the same instrument, and either of the parties hereto may execute this
Lease by signing any such counterpart. | 442 |
agreement_19.md | (h) Each party hereto agrees to keep confidential, the terms and provisions of the Documents
and the transactions contemplated hereby and thereby (collectively, the “**Transactions**”).
Notwithstanding the foregoing, the obligations of confidentiality contained herein, as they relate
to the Transactions, shall not apply to the federal tax structure or federal tax treatment of the
Transactions, and each party hereto (and any employee, representative, or agent of any party
hereto) may disclose to any and all persons, without limitation of any kind, the federal tax
structure and federal tax treatment of the Transactions. The preceding sentence is intended to
cause each Transaction to be treated as not having been offered under conditions of confidentiality
for purposes of Section 1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
promulgated under Section 6011 of the Internal Revenue Code of 1986, as amended, and shall be
construed in a manner consistent with such purpose. In addition, each party hereto acknowledges
that it has no proprietary or exclusive rights to the federal tax structure of the Transactions or
any federal tax matter or federal tax idea related to the Transactions . | 443 |
agreement_19.md | **IN WITNESS WHEREOF,** Lessee and Lessor have caused this Lease to be executed by their
duly authorized representatives as of the date first above written.
| | | | | | | | | |
| LESSOR: | | | | LESSEE: |
| | | | | | | | | |
| **CFS Air, LLC** | | | | **Air Logistics, L.L.C.** |
| **By its Manager** | | | | **By its Manager** |
| **General Electric Capital Corporation** | | | | **William E. Chiles** |
| | | | | | | | | |
| By:
| | | | | | By: | | |
|
| | | | | | | | |
| | | | | | | | | |
| Name:
| | | | | | Name:
| | William E. Chiles |
|
| | | | | | | | |
| | | | | | | | | |
| Title:
| | | | | | Title:
| | Manager |
|
| | | | | | | | |
--- | 444 |
agreement_19.md | **ANNEX A (SN** **)
TO AIRCRAFT LEASE AGREEMENT (SN** **)
DATED AS OF DECEMBER \_\_\_\_\_\_, 2005
Description of Aircraft, Lessor’s Cost, and Aircraft Markings**
| | | |
| | | |
| **I.** **Description** | | **Cost: $[See Schedule I]** |
Sikorsky Model S-76C Helicopter which consists of the following components:
(a) Airframe
bearing FAA Registration Mark and Manufacturer’s Serial No. ;
(b) Two (2) Turbomeca Arriel 2S1 engines bearing Manufacturer’s Serial Nos.
and respectively (each of which has 750 or more rated takeoff
horsepower or the equivalent of such horsepower);
(c) Four (4) 76150-09100-053 main rotor blades bearing Manufacturer’s Serial
Nos. , , and ;
(d) All other property essential and appropriate to the operation
of the Aircraft, including but not limited to all instruments,
avionics, auxiliary power units, equipment and accessories attached
to, connected with or related to the Aircraft, and all logs,
manuals and other documents issued for, or reflecting use or
maintenance of, the Aircraft.
**Capitalized Lessor’s Cost** **$[See Schedule I]**
**II. Aircraft Markings (referenced in the MAINTENANCE Section of Lease)**
(a) None, unless Aircraft is operated outside the United States and then; Four-by-six
inch plaque to be maintained in cockpit and affixed in conspicuous position stating:
**CFS Air, LLC** Owner and Lessor. | 445 |
agreement_19.md | **CFS Air, LLC** Owner and Lessor.
**Air Logistics, L.L.C.** Lessee under a certain
Lease (SN ) dated as of **December \_\_\_\_\_, 2005**
has operational control of this aircraft.
(b) Similar markings shall be permanently affixed to each engine.
Initials:
| | | | | | | | | | | |
| Lessee:
| | | | | | Lessor | | | | |
|
| | | | | | | | | | | | 446 |
agreement_19.md | **ANNEX B (SN** **)
DATED THIS DECEMBER \_\_\_\_\_\_, 2005
TO AIRCRAFT LEASE AGREEMENT (SN** **)
DATED AS OF DECEMBER \_\_\_\_\_, 2005**
| | | | | |
| Lessor & Mailing Address:
| | | | Lessee & Mailing Address: |
| **CFS Air, LLC**
| | | | **Air Logistics, L.L.C.** |
| **44 Old Ridgebury Road**
| | | | **4605 Industrial Drive** |
| **Danbury, CT 06810**
| | | | **New Iberia, LA 70560** |
Capitalized terms not defined herein shall have the meanings assigned to them in the Aircraft Lease
Agreement (SN ) identified above.
**A. Aircraft.**
Pursuant to the terms of the Lease, Lessor agrees to acquire and lease to Lessee the
Aircraft described on Annex A (SN ) to the Lease.
**B. Financial Terms.**
| | | | | | | | | | | 447 |
agreement_19.md | |
| | 1.
| | Advance Rent (if any):
| | **(a) Amount: N/A.** | | |
|
| | | | | | **(b) Due Date: N/A** | | |
|
| | 2.
| | Capitalized Lessor’s Cost:
| | **$[See Schedule I]** | | |
|
| | 3.
| | Basic Term Commencement Date:
| | **January 2, 2006**. | | |
|
| | 4.
| | Basic Term:
| | **One Hundred Twenty (120) months**. | | |
|
| | 5.
| | First Basic Term Rent Date:
| | **January 2, 2006**. | | |
|
| | 6.
| | Basic Term Rent Dates:
| | **2****nd** **day of every month.** | | |
|
| | 7.
| | First Termination Date:
| | **(24) months after the Basic Term Commencement Date.** | | |
|
| | 8.
| | Last Basic Term Rent Date:
| | **December 2, 2015**. | | |
|
| | 9.
| | Last Delivery Date:
| | **December 30, 2005** . | | |
| | 448 |
agreement_19.md | | | Last Delivery Date:
| | **December 30, 2005** . | | |
|
| | 10.
| | Primary Hangar Location:
| | **4605 Industrial Drive, New Iberia, LA 70560** | | |
|
| | 11.
| | Supplier:
| | **Sikorsky Aircraft Corporation** | | |
|
| | 12.
| | Lessee Federal Tax ID No.:
| | **72-1412904.** | | |
|
| | 13.
| | Early Purchase Option:
| | Option Date: **January 2, 2011** | | |
|
| | | | | |
Option Price: **$[See Schedule I]** | | |
|
| | 14.
| | Expiration Date:
| | **January 1, 2016**. | | |
|
| | 15.
| | Daily Lease Rate Factor:
| | **[See Schedule I]%** | | |
|
| | 16.
| | Basic Term Lease Rate Factor: | | | | |
|
| | | | | | **Factor**
**Rental No.** | | |
|
| | | | | | **[See Schedule I]%** **1 – 60** | | |
| | 449 |
agreement_19.md | |
| | | | | | **[See Schedule I]%** **61-120** | | | | 450 |
agreement_19.md | **C. Tax Benefits.**
Depreciation Deductions:
| | | | |
| --- | --- | --- | --- |
| | a. | | Depreciation Method: 200% declining balance method, switching to straight line
method for the 1st taxable year for which using the straight line method with respect to
the adjusted basis as of the beginning of such year will yield a larger allowance. |
| |
| | b. | | Recovery Period: **Five (5) years** |
| |
| | c. | | Basis: **100%** of Capitalized Lessor’s Cost. | | 451 |
agreement_19.md | **D. Term and Rent** (Rent shall mean Interim Rent and Basic Term Rent) **.**
| | | | |
| --- | --- | --- | --- |
| | 1. | | Interim Rent. For the period from and including the Commencement Date to the Basic
Term Commencement Date (**“Interim Period”**), Lessee shall pay as Rent (**“Interim Rent”**) for
the Aircraft, the product of the Daily Lease Rate Factor times the Capitalized Lessor’s
Cost of the Aircraft on this Annex B (SN ) times the number of days in the Interim
Period. Interim Rent shall be due on **January 2, 2006**. |
| |
| | 2. | | Basic Term Rent. Commencing on **January 2, 2006** and on the same day of each **month**
thereafter (each, a **“Rent Payment Date”**) during the Basic Term, Lessee shall pay as Rent
(**“Basic Term Rent”**) the product of the Basic Term Lease Rate Factor times the
Capitalized Lessor’s Cost of the Aircraft on this Annex B (SN ). |
**E. Insurance.**
| | | | |
| --- | --- | --- | --- |
| | 1. | | Public Liability: **$** **50,000,000.00** total liability per occurrence. |
| |
| | 2. | | Casualty and Property Damage: An amount which is not less than the then
Stipulated Loss Value of the Aircraft. |
**F. Funding Holdback.** | 452 |
agreement_19.md | **F. Funding Holdback.**
The Capitalized Lessor’s Cost set forth above and the Stipulated Loss and Termination
Value Tables shown in Annex F (SN ) include **$[See Schedule I]** (the “**Holdback Amount**”)
to be held by Lessor and released to Lessee per the terms of the Additional Collateral
Agreement dated December\_\_\_, 2005. Lessor shall pay the Holdback Amount in
consideration for, among other obligations, transfer of title to the Aircraft on the
Commencement Date.
**G. Amendments to Lease.**
Except as expressly modified hereby, all terms and provisions of the Lease shall remain in full
force and effect. This Annex B is not binding or effective with respect to the Lease or the
Aircraft until executed on behalf of Lessor and Lessee by authorized representatives of Lessor and
Lessee, respectively. | 453 |
agreement_19.md | **IN WITNESS WHEREOF,** Lessee and Lessor have caused this Annex B to be executed by
their duly authorized representatives as of the date first above written.
| | | | | | | | | | | 454 |
agreement_19.md | | LESSOR: | | | | LESSEE: |
| | | | | | | | | |
| **CFS Air, LLC** | | | | **Air Logistics, L.L.C.** |
| **By its Manager** | | | | **By its Manager** |
| **General Electric Capital Corporation** | | | | **William E. Chiles** |
| | | | | | | | | |
| By:
| | | | | | By: | | |
|
| | | | | | | | |
| | | | | | | | | |
| Name:
| | | | | | Name:
| | William E. Chiles |
|
| | | | | | | | |
| | | | | | | | | |
| Title:
| | | | | | Title:
| | Manager |
|
| | | | | | | | |
| | | | | | | | | |
| | | | | | | **Attest** |
| | | | | | | | | |
|
| | | | | | By: | | |
| | 455 |
agreement_19.md | |
| | | | | | By: | | |
|
| | | | | | | | |
| | | | | | | | | |
|
| | | | | | Name: | | |
|
| | | | | | | | | | 456 |
agreement_19.md | **ANNEX C (SN** **)
TO
TO AIRCRAFT LEASE AGREEMENT (SN** **)
DATED AS OF DECEMBER \_\_\_\_\_\_, 2005**
**BILL OF SALE**
**Air Logistics, L.L.C.** (the **“Seller”**), in consideration of the sum of **[See Schedule I]** plus
sales taxes in the amount of **Zero Dollars** (**$0.00**) paid by **CFS Air, LLC** (together with its
successors and assigns, if any, the **“Buyer”**), receipt of which is acknowledged, hereby grants,
sells, assigns, transfers and delivers to Buyer the aircraft (the **“Aircraft”**) described in Annex
A (SN ) to the above referenced Aircraft Lease Agreement (SN ) (**“Lease”**), along with
whatever claims and rights Seller may have against the manufacturer and/or supplier of the
Aircraft (the **“Supplier”**), including but not limited to all warranties and representations.
Buyer is purchasing the Aircraft for leasing to Lessee pursuant to the Lease. Seller represents
and warrants to Buyer that (1) Buyer will acquire by the terms of this Bill of Sale good title to
the Aircraft free from all liens and encumbrances whatsoever; and (2) Seller has the right to
sell the Aircraft. | 457 |
agreement_19.md | Seller agrees to save and hold harmless Buyer from and against any and all federal, state,
municipal and local license fees and taxes of any kind or nature, including, without limiting the
generality of the foregoing, any and all excise, personal property, use and sales taxes, VAT,
stamp, withholding, and from and against any and all liabilities, obligations, losses, damages,
penalties, claims, actions and suits resulting therefrom and imposed upon, incurred by or
asserted against Buyer as a consequence of the sale of the Aircraft to Buyer. | 458 |
agreement_19.md | **IN WITNESS WHEREOF,** Seller has executed this Bill of Sale this \_\_\_day of
December, 2005.
| | | | | |
| | | SELLER: |
| | | | | |
| | | **Air Logistics, L.L.C.** |
| | | **By its Manager** |
| | | **William E. Chiles** |
| | | | | |
|
| | By: | | |
|
| | | | |
| | | | | |
|
| | Name:
| | William E. Chiles |
| | | | | |
|
| | Title:
| | Manager |
---
#####
**ANNEX D**
**CERTIFICATE (SN** **)**
CERTIFICATE OF MANAGERS/MEMBERS OF AIR LOGISTICS, L.L.C.
***INTENTIONALLY OMITTED***
--- | 459 |
agreement_19.md | **ANNEX E**
**CERTIFICATE OF ACCEPTANCE (SN** **)**
**AIRCRAFT LEASE AGREEMENT (SN** **)** dated as of **December \_\_\_, 2005** (the
**“Lease”**), between **CFS Air, LLC** together with its successors and assigns, if any, as lessor (the
**“Lessor”**), and **Air Logistics, L.L.C.** as lessee (the **“Lessee”**).
**A.**The Aircraft: Lessee hereby certifies, as of the date set forth below, that the Aircraft
as set forth and described in Annex A (SN ) to the Lease has been delivered to Lessee,
inspected by Lessee, found to be in good order and fully equipped to operate as required under
applicable law for its intended purpose, and is fully and finally accepted under the Lease.
**B**. Representations by Lessee: Lessee hereby represents and warrants to Lessor that on the
date hereof: | 460 |
agreement_19.md | | | | | |
| --- | --- | --- | --- |
| | (1) | | The representations and warranties of Lessee set forth in the Lease and all
certificates delivered in connection therewith were true and correct in all respects
when made and are true and correct as of the date hereof. |
| |
| | (2) | | Lessee has satisfied or complied with all conditions precedent and requirements
set forth in the Lease which are required to be or to have been satisfied or complied
with on or prior to the date hereof. |
| |
| | (3) | | No Default or Event of Default under the Lease has occurred and is continuing
on the date hereof. |
| |
| | (4) | | Lessee has obtained, and there are in full force and effect, such insurance
policies with respect to the Aircraft, as are required to be obtained under the terms
of the Lease. |
| |
| | (5) | | Lessee has furnished no equipment for the Aircraft other than as sold to Lessor
and as stated on Annex A (SN ) hereto or permitted as an addition thereto
pursuant to the Lease. |
| |
| | (6) | | The Lessee has inspected the Aircraft and all pertinent records therefor and
the Aircraft has no damage history. | | 461 |
agreement_19.md | **IN WITNESS WHEREOF**, Lessee has caused this Certificate of Acceptance to be duly
executed by its officers thereunto duly authorized.
| | | | | | | |
| | | Lessee: | | |
| | | **Air Logistics, L.L.C.** | | |
| | | **By its Manager** | | |
| | | **William E. Chiles** | | |
| | | | | | | |
|
| | By: | | | | |
|
| | | | | | |
| | | | | | | |
| | | Name: William E. Chiles | | |
| | | | | | | |
| | | Title: Manager | | |
| | | | | | | |
| | | Date: | | |
|
| | | | | | |
--- | 462 |
agreement_19.md | **ANNEX F (SN )**
**Stipulated Loss and Termination Values**
The Stipulated Loss and Termination Value of the Aircraft shall be the
percentage of Capitalized Lessor’s Cost of the aircraft set forth opposite the applicable
rent payment.
**Capitalized
Lessor’s Cost $ [See Schedule I]**
| | | | | | | | | |
| # of | | | | | | stipulated |
| base | | termination | | loss |
| payments | | value | | value | | 463 |
agreement_19.md | | 1 | | | 103.300 | | | | 103.300 | |
| 2 | | | 103.236 | | | | 103.236 | |
| 3 | | | 103.004 | | | | 103.004 | |
| 4 | | | 102.744 | | | | 102.744 | |
| 5 | | | 102.475 | | | | 102.475 | |
| 6 | | | 102.198 | | | | 102.198 | |
| 7 | | | 101.911 | | | | 101.911 | |
| 8 | | | 101.621 | | | | 101.621 | |
| 9 | | | 101.322 | | | | 101.322 | |
| 10 | | | 101.013 | | | | 101.013 | |
| 11 | | | 100.702 | | | | 100.702 | |
| 12 | | | 100.381 | | | | 100.381 | |
| 13 | | | 100.051 | | | | 100.051 | |
| 14 | | | 99.717 | | | | 99.717 | | | 464 |
agreement_19.md | | 14 | | | 99.717 | | | | 99.717 | |
| 15 | | | 99.380 | | | | 99.380 | |
| 16 | | | 99.036 | | | | 99.036 | |
| 17 | | | 98.686 | | | | 98.686 | |
| 18 | | | 98.329 | | | | 98.329 | |
| 19 | | | 97.965 | | | | 97.965 | |
| 20 | | | 97.598 | | | | 97.598 | |
| 21 | | | 97.224 | | | | 97.224 | |
| 22 | | | 96.844 | | | | 96.844 | |
| 23 | | | 96.460 | | | | 96.460 | |
| 24 | | | 96.069 | | | | 96.069 | |
| 25 | | | 95.672 | | | | 95.672 | |
| 26 | | | 95.272 | | | | 95.272 | |
| 27 | | | 94.867 | | | | 94.867 | | | 465 |
agreement_19.md | | 27 | | | 94.867 | | | | 94.867 | |
| 28 | | | 94.459 | | | | 94.459 | |
| 29 | | | 94.046 | | | | 94.046 | |
| 30 | | | 93.629 | | | | 93.629 | |
| 31 | | | 93.207 | | | | 93.207 | |
| 32 | | | 92.783 | | | | 92.783 | |
| 33 | | | 92.353 | | | | 92.353 | | | 466 |
agreement_19.md | Initials: Lessee Lessor: | 467 |
agreement_19.md | | | | | | | | | | |
| # of | | | | | | stipulated |
| base | | termination | | loss |
| payments | | value | | value | | 468 |
agreement_19.md | | 34 | | | 91.919 | | | | 91.919 | |
| 35 | | | 91.482 | | | | 91.482 | |
| 36 | | | 91.041 | | | | 91.041 | |
| 37 | | | 90.595 | | | | 90.595 | |
| 38 | | | 90.146 | | | | 90.146 | |
| 39 | | | 89.693 | | | | 89.693 | |
| 40 | | | 89.236 | | | | 89.236 | |
| 41 | | | 88.775 | | | | 88.775 | |
| 42 | | | 88.310 | | | | 88.310 | |
| 43 | | | 87.841 | | | | 87.841 | |
| 44 | | | 87.368 | | | | 87.368 | |
| 45 | | | 86.892 | | | | 86.892 | |
| 46 | | | 86.411 | | | | 86.411 | |
| 47 | | | 85.927 | | | | 85.927 | | | 469 |
agreement_19.md | | 47 | | | 85.927 | | | | 85.927 | |
| 48 | | | 85.439 | | | | 85.439 | |
| 49 | | | 84.947 | | | | 84.947 | |
| 50 | | | 84.451 | | | | 84.451 | |
| 51 | | | 83.952 | | | | 83.952 | |
| 52 | | | 83.450 | | | | 83.450 | |
| 53 | | | 82.945 | | | | 82.945 | |
| 54 | | | 82.438 | | | | 82.438 | |
| 55 | | | 81.928 | | | | 81.928 | |
| 56 | | | 81.414 | | | | 81.414 | |
| 57 | | | 80.898 | | | | 80.898 | |
| 58 | | | 80.379 | | | | 80.379 | |
| 59 | | | 79.857 | | | | 79.857 | |
| 60 | | | 79.332 | | | | 79.332 | | | 470 |
agreement_19.md | | 60 | | | 79.332 | | | | 79.332 | |
| 61 | | | 78.803 | | | | 78.803 | |
| 62 | | | 78.110 | | | | 78.110 | |
| 63 | | | 77.413 | | | | 77.413 | |
| 64 | | | 76.715 | | | | 76.715 | |
| 65 | | | 76.015 | | | | 76.015 | |
| 66 | | | 75.314 | | | | 75.314 | |
| 67 | | | 74.611 | | | | 74.611 | |
| 68 | | | 73.903 | | | | 73.903 | |
| 69 | | | 73.195 | | | | 73.195 | |
| 70 | | | 72.485 | | | | 72.485 | |
| 71 | | | 71.770 | | | | 71.770 | |
| 72 | | | 71.054 | | | | 71.054 | |
| 73 | | | 70.337 | | | | 70.337 | | | 471 |
agreement_19.md | | 73 | | | 70.337 | | | | 70.337 | |
| 74 | | | 69.615 | | | | 69.615 | |
| 75 | | | 68.889 | | | | 68.889 | |
| 76 | | | 68.161 | | | | 68.161 | |
| 77 | | | 67.432 | | | | 67.432 | |
| 78 | | | 66.703 | | | | 66.703 | |
| 79 | | | 65.971 | | | | 65.971 | | | 472 |
agreement_19.md | Initials: Lessee Lessor: | 473 |
agreement_19.md | | | | | | | | | | |
| # of | | | | | | stipulated |
| base | | termination | | loss |
| payments | | value | | value | | 474 |
agreement_19.md | | 80 | | | 65.236 | | | | 65.236 | |
| 81 | | | 64.499 | | | | 64.499 | |
| 82 | | | 63.761 | | | | 63.761 | |
| 83 | | | 63.019 | | | | 63.019 | |
| 84 | | | 62.275 | | | | 62.275 | |
| 85 | | | 61.530 | | | | 61.530 | |
| 86 | | | 60.781 | | | | 60.781 | |
| 87 | | | 60.027 | | | | 60.027 | |
| 88 | | | 59.273 | | | | 59.273 | |
| 89 | | | 58.516 | | | | 58.516 | |
| 90 | | | 57.759 | | | | 57.759 | |
| 91 | | | 57.001 | | | | 57.001 | |
| 92 | | | 56.238 | | | | 56.238 | |
| 93 | | | 55.474 | | | | 55.474 | | | 475 |
agreement_19.md | | 93 | | | 55.474 | | | | 55.474 | |
| 94 | | | 54.708 | | | | 54.708 | |
| 95 | | | 53.938 | | | | 53.938 | |
| 96 | | | 53.167 | | | | 53.167 | |
| 97 | | | 52.395 | | | | 52.395 | |
| 98 | | | 51.619 | | | | 51.619 | |
| 99 | | | 50.838 | | | | 50.838 | |
| 100 | | | 50.055 | | | | 50.055 | |
| 101 | | | 49.272 | | | | 49.272 | |
| 102 | | | 48.487 | | | | 48.487 | |
| 103 | | | 47.701 | | | | 47.701 | |
| 104 | | | 46.911 | | | | 46.911 | |
| 105 | | | 46.119 | | | | 46.119 | |
| 106 | | | 45.327 | | | | 45.327 | | | 476 |
agreement_19.md | | 106 | | | 45.327 | | | | 45.327 | |
| 107 | | | 44.530 | | | | 44.530 | |
| 108 | | | 43.731 | | | | 43.731 | |
| 109 | | | 42.932 | | | | 42.932 | |
| 110 | | | 42.128 | | | | 42.128 | |
| 111 | | | 41.319 | | | | 41.319 | |
| 112 | | | 40.510 | | | | 40.510 | |
| 113 | | | 39.699 | | | | 39.699 | |
| 114 | | | 38.887 | | | | 38.887 | |
| 115 | | | 38.073 | | | | 38.073 | |
| 116 | | | 37.256 | | | | 37.256 | |
| 117 | | | 36.437 | | | | 36.437 | |
| 118 | | | 35.617 | | | | 35.617 | |
| 119 | | | 34.792 | | | | 34.792 | | | 477 |
agreement_19.md | | 119 | | | 34.792 | | | | 34.792 | |
| 120 | | | 33.966 | | | | 33.966 | | | 478 |
agreement_19.md | [Note – Termination and Stipulated Loss Values may vary in individual leases by immaterial amounts.]
Initials: Lessee Lessor: | 479 |
agreement_19.md | **ANNEX
G (SN )
TO
AIRCRAFT LEASE (SN ) DATED DECEMBER \_\_\_\_\_, 2005
ADDITIONAL MAINTENANCE AND RETURN CONDITIONS**
The above captioned Aircraft Lease Agreement (SN ) between **CFS Air, LLC** (“**Lessor**”) and
**Air Logistics, L.L.C.** (“**Lessee**”) shall be amended by adding the following:
GENERAL CONDITIONS:
(1) Upon Lease termination, Lessee shall, at Lessee’s expense, return the Aircraft to a
location in the Continental United States as Lessor shall designate. Lessee shall take reasonable
care to protect the Aircraft from damage and mechanical and appearance degradation. Such
reasonable care shall include, but not be limited to, installation of all covers, tie-downs, and
other protective, shipping or storage devices delivered to Lessee with the Aircraft at Lease
inception.
(2) Upon Lease termination, it is agreed that, if requested in writing, Lessee will use
reasonable efforts to locate and secure adequate indoor hangar facilities for the storage of the
Aircraft. All costs incurred by Lessee in securing hangar facilities for the Aircraft will be
reimbursed by Lessor on a “net-net” basis, and only after Lessee has received written authorization
from Lessor to secure such storage, including the rate to be paid. | 480 |
agreement_19.md | (3) If so requested in writing by Lessor, Lessee shall, at Lessor’s expense, maintain
uninterrupted insurance coverage with Lessor listed as an “Additional Named Insured”, listing the
Lessor as “Loss Payee”, including a “Lender’s (or Lessor’s/Owner’s) Interest Endorsement” (commonly
referred to as a “Breach of Warranty Endorsement) for a period not to exceed ninety (90) days.
This period may be extended if so agreed in writing by both Lessee and Lessor.
(4) The Aircraft and all its parts, components, avionics, and installed optional equipment
shall be clear of all liens and encumbrances other than those in favor of Lessor or their assignee
or permitted under Section 8(a) of the Lease.
(5) Lessee shall make the Aircraft and all related books and records available for inspection
by Lessor or its representative once annually throughout the term of the Lease and any time within
a ninety (90) day period prior to Lease termination. This shall be followed by a return acceptance
inspection by Lessor or its representative concurrent with Lease termination.
AIRCRAFT CONDITIONS: | 481 |
agreement_19.md | AIRCRAFT CONDITIONS:
(6) The Aircraft shall be returned to Lessor in good operating condition. It shall be both
flyable and “Airworthy” as described in the Federal Aviation Regulations (“**FAR**”). All windshields,
“chin windows,” door glass, and fuselage windows shall be free of cracks. All interior trim pieces
shall be free of damage (normal wear and tear excepted). The exterior paint shall be in good
condition (normal wear and tear excepted). All markings applied by, or on behalf of, the Lessee
shall be removed in such a manner so as to return the Aircraft to its appearance as of the time the
Lessee originally took possession of the Aircraft, or which has been subsequently approved by
Lessor.
(7) All parts and components that have a specified service life or maintenance interval
approved by the Federal Aviation Administration (“**FAA**”), whether it be an overhaul requirement,
time retirement or inspection, shall have at least 50% of their scheduled life remaining.
Remaining life shall be computed from 50% point of whichever the determining service limit to be
reached first is, whether it be calendar time, number of cycles or flight hours. (When computing
the remaining life of any component, the most recent intervals published by the manufacturer and
approved by the FAA for unrestricted use shall be utilized).
(8) The dollar figures for calculating the debits of times with a mandatory service life
limit shall be the then-current manufacturer’s list price.
(9) The dollar figures for calculating the debits of items with manufacturer recommended
overhaul interval shall be determined by the manufacturers then current list price. | 482 |
agreement_19.md | (10) Any parts and components installed at the termination of the Lease shall be of the same
configuration and part number (or approved superceding configuration and part number) as were
installed at Lease inception. | 483 |
agreement_19.md | (11) The Aircraft must have had an “Annual Inspection” as described in the FARs performed by
an FAA Certificated Repair Station within thirty (30) days of the date of termination of the Lease.
Lessee shall, at their expense, correct any discrepancies discovered during the Annual Inspection,
and any other discrepancies which may become evident prior to Lease termination.
Lessee shall provide to Lessor evidence that all monies due pursuant to the Power By Hour
maintenance service program has been paid in full to supplier of such program.
Lessee shall also conduct an engine power assurance check, with the results documented and
signed by the person performing the check. Lessee shall, at their expense, take whatever actions
are necessary to ensure that the engine(s) produce their rated power. Lessee shall also ensure
that main and tail rotor vibration levels shall be equal to, or lower than, the minimum acceptable
limits quoted by the airframe manufacturer. In the absence of published minimum vibration levels,
main and tail rotor vibration levels shall be 0.2 Inches Per Second (“**IPS**”) or less.
(12) Commencing with Lease inception, and continuing uninterrupted throughout the duration of
the Lease, the Lessee shall maintain separate consolidated lists of Airworthiness Directives (“**AD**”)
and mandatory Service Bulletins (“**SB**”), for both the airframe and engine(s), in a form similar to
the attached sample forms entitled: “Airworthiness Directive Compliance Record” and “Service
Bulletin Compliance Record.”
NOTE: Computer generated AD & SB compliance reports may be acceptable if EACH PAGE
contains at least the information required in blocks 1 through 11 on the sample forms plus a
certification statement and signature of an appropriately FAA licensed maintenance technician. The
certification statement should be similar to the following: | 484 |
agreement_19.md | I hereby certify that the Airworthiness Directives and manufacturer’s Service Bulletins listed
on this sheet have been checked for compliance and have proven to be accurate. I further certify
that the necessary entries have been made in the permanent Aircraft records in compliance with Part
43 of the Federal Aviation Regulations.
Signed:
Certificate Number:
Date:
AFTT:
Eng #1 TT Eng #2 TT:
(13) All maintenance record entries shall be in the form and format specified in FAR Part 43.
(14) All parts and components installed on the Aircraft shall originate from commercial
manufacturers holding appropriate FAA approvals and shall be traceable to the original
manufacturer, with proper statement of manufacturer’s authority quoted. Invoices for parts should
include the following, or a similarly worded statement:
The parts identified on this invoice conform to manufacturer’s approved standards, current
(insert OEM name) publications, and FAA requirements.
(15) The Aircraft shall be returned in the same configuration as it was at the time of
delivery to the Lessee, unless otherwise agreed to by both parties. Any FAA approved modifications
installed by Lessee during the Lease period that cannot be removed without leaving evidence of
their installation shall become a permanent part of the Aircraft and the property of the Lessor.
(16) The following items shall be returned to Lessor at the termination of the Lease: | 485 |
agreement_19.md | (16) The following items shall be returned to Lessor at the termination of the Lease:
| | | | |
| --- | --- | --- | --- |
| | (a) | | All maintenance records |
| |
| | (b) | | Current copies of all parts, maintenance, and flight manuals and copies of all
SBs and ADs applicable to the Aircraft |
| |
| | (c) | | All loose equipment (tie-downs, ground handling wheels, tow bars, covers, and
other specialized equipment) that was delivered to Lessee with the Aircraft, or which
have become necessary because of additional installed equipment or modifications to the
Aircraft. |
| | | |
| Initials: Lessee
| | Lessor: | | 486 |
agreement_19.md | **ANNEX
H (SN )
TO
AIRCRAFT LEASE AGREEMENT (SN )
DATED AS OF DECEMBER \_\_\_\_, 2005**
**Definition of “Guarantor Change of Control”**
“Guarantor Change of Control” means the occurrence of any of the following:
(1) the sale, lease, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of all
or substantially all of the properties or assets of the Guarantor and its
subsidiaries (determined on a consolidated basis);
(2) the adoption of a plan relating to the liquidation or dissolution of the
Guarantor;
(3) any “person” (as such term is used in Section 13(d)(3) of the Exchange Act)
becomes the “beneficial owner” (as such term is defined in Rule 13d-3 and Rule 13d-5
under the Exchange Act), directly or indirectly through one or more intermediaries,
of more than 50% of the voting power of the outstanding voting stock of the
Guarantor; or
(4) the first day on which more than a majority of the members of the board of
directors are not Continuing Directors (as hereinafter defined); provided, however,
that, with respect to clause (3) above, a transaction in which the Guarantor becomes
a subsidiary of another Entity (as hereinafter defined) shall not constitute a
Change of Control if | 487 |
agreement_19.md | | | | | |
| --- | --- | --- | --- |
| | (a) | | the stockholders of the Guarantor immediately prior to
such transaction “beneficially own” (as such term is defined in Rule
13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly
through one or more intermediaries, at least a majority of the voting
power of the outstanding voting stock of the Guarantor immediately
following the consummation of such transaction; and |
| |
| | (b) | | immediately following the consummation of such
transaction, no “person” (as such term is defined above), other than
such other Entity (but including the holders of the equity interests of
such other Entity), “beneficially owns” (as such term is defined
above), directly or indirectly through one or more intermediaries, more
than 50% of the voting power of the outstanding voting stock of the
Guarantor. |
In this Section, “Continuing Directors” means, as of any date of determination, any
member of the board of directors who (a) was a member of the board of directors on
June 20, 2003 or (b) was nominated for election to the board of directors with the
approval of, or whose election to the board of directors as ratified by, at least a
majority of the Continuing Directors who were members of the board of directors at
the time of such nomination or election. “Entity” means any corporation,
partnership, joint venture, association, joint-stock company, trust, unincorporated
organization, limited liability company, government or any agency or political
subdivision hereof or any other entity.
Page 30 of 30 | 488 |
agreement_19.md | **Schedule I – Summary of Lease-specific Terms**
| | | | | | | | | | | | | | | | | | | | | |
| **Lease No.** | | **Cost / Capitalized Lessor’s Cost** | | **Daily Lease Rate Factor** | | **Holdback Amount** | | **Early
Purchase Option Price** | | **Term
Lease Rate Factor** | | 489 |
agreement_19.md | | SN 760527 | | $ | 7,110,000.00 | | | | 0.0255265 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760529 | | $ | 7,1920,000.00 | | | | 0.0255267 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760531 | | $ | 7,410,000.00 | | | | 0.02552363 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | | | 490 |
agreement_19.md | | SN 760536 | | $ | 7,520,000.00 | | | | 0.015954 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760557 | | $ | 7,840,000.00 | | | | 0.016068 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760562 | | $ | 7,880,000.00 | | | | 0.0160813 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | | | 491 |
agreement_19.md | | SN 760564 | | $ | 7,830,000.00 | | | | 0.0160643 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760579 | | $ | 7,920,000.00 | | | | 0.016095 | % | | $ | 1,142,000.00 | | | | \* \* \* | | | | \* \* \* | |
| | | | | | | | | | | | | | | | | | | | | | |
| SN 760580 | | $ | 7,940,000.00 | | | | 0.0160853 | % | | $ | 1,149,000.00 | | | | \* \* \* | | | | \* \* \* | | | 492 |
agreement_19.md | **[NOTE — INFORMATION
MARKED \* \* \* HAS BEEN OMITTED FROM THIS EXHIBIT AND FILED SEPARATELY WITH THE SEC PURSUANT TO A
CONFIDENTIAL TREATMENT REQUEST UNDER RULE 24b-2.]** | 493 |
agreement_2.md | EX1K-6 MAT CTRCT 4 tm2214014d1\_ex6-11.htm EXHIBIT 6.11
\*\*Exhibit 6.11\*\*
\*\*AIRCRAFT LEASE (MSN 42000181)\*\*
\*\*THIS AIRCRAFT LEASE (MSN 42000181)\*\* (together with all Supplements, Riders
and Addenda hereto, this “ \*\*Lease\*\* ”) is dated as of November 23, 2021 (the
“ \*\*Closing Date\*\* ”) by and between \*\*WESTERN FINANCE COMPANY\*\* , an Arizona
corporation, as lessor (“ \*\*Lessor\*\* ”), and \*\*GALILEE 1 SPV LLC\*\* , a
Delaware limited liability company, as lessee (“ \*\*Lessee\*\* ”). Capitalized
and certain other terms used but not otherwise defined in this Lease shall
have the meanings ascribed to them in \_Annex A\_ attached hereto and made a
part hereof.
In consideration of the mutual agreements contained herein, and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
\*\*SECTION 1. LEASE OF AIRCRAFT\*\*. | 494 |
agreement_2.md | \*\*SECTION 1. LEASE OF AIRCRAFT\*\*.
1.1 \*\*Purchase and Lease\*\*. Subject to the terms and conditions provided in
this Lease and the other Lease Documents, Lessor agrees to purchase the
Aircraft from Supplier and to lease the Aircraft to Lessee, and Lessee agrees
to facilitate such purchase and to lease the Aircraft from Lessor. Lessor
hereby appoints Lessee as Lessor’s agent for the sole and limited purpose of
accepting delivery of the Aircraft from Supplier.
1.2 \*\*Lease Supplement\*\*. The execution by Lessee of the Lease Supplement will
evidence that the Aircraft is leased under, and is subject to all of the
terms, provisions and conditions of, this Lease and the other Lease Documents,
and shall constitute Lessee’s unconditional and irrevocable acceptance of the
Aircraft for all purposes hereof and thereof. The lease of the Aircraft to
Lessee shall commence on the Acceptance Date and end on the Expiration Date,
unless extended or earlier terminated or cancelled pursuant to this Lease.
Lessor’s agreement to purchase the Aircraft from Supplier and to lease the
Aircraft to Lessee on the Acceptance Date is subject to and conditioned upon
the satisfaction of all of the conditions precedent specified in the Closing
Terms Addendum attached to and made a part of this Lease. Lessee warrants that
as of, and at all times after the Acceptance Date, Lessor will be the legal
owner of the Aircraft, and Lessee shall have only the right to use and possess
the Aircraft in accordance with the Lease Documents, in each case, except as
otherwise expressly provided in this Lease.
\*\*SECTION 2. RENT, NET LEASE\*\*. | 495 |
agreement_2.md | 2.1 \*\*Rent\*\*. Lessee shall pay to Lessor the following amounts (any and all
such amounts, as applicable, “ \*\*Rent\*\* ”): (a) as “ \*\*Basic Rent\*\* ”, (i) on
the First Basic Rent Date, Daily Rent for each day starting with the
Acceptance Date, to but excluding the Rent Commencement Date; and (ii) on the
First Basic Rent Date and on each Basic Rent Date following that date, an
amount equal to the product of (A) the Lessor’s Cost, \_multiplied\_ by (B) the
applicable Basic Rent Percentage set forth on \_Schedule No. 2A\_ for such
Basic Rent Date; and (b) as “ \*\*Supplemental Rent\*\* ”, (i) as and when due,
any other amount that Lessee is obligated to pay under this Lease or any of
the Transaction Documents to Lessor or any other Person (including, Casualty
Value and/or any amounts due pursuant to any Addendum) and (ii) the
Administrative Charge with respect to any Rent not paid when due (as
compensation to Lessor for the expenses attributable to Lessee’s failure to
pay, and not as a penalty). If the due date of any payment required to be made
hereunder is not a Business Day, such payment shall be due on the next
succeeding Business Day. Lessee shall make all payments of Rent in United
States Dollars (“ \*\*U.S. Dollars\*\* ”), in immediately available funds on the
date payable under this Lease or the other Transaction Documents, in the
manner (whether by check, wire transfer or otherwise) directed by Lessor in
writing to Lessee. | 496 |
agreement_2.md | 2.2 \*\*Net Lease\*\*. This Lease is a net lease, and Lessee acknowledges and
agrees that: (a) Lessee’s obligation to pay, and Lessor’s right to receive,
all Rent in accordance with this Lease shall be absolute, irrevocable,
independent and unconditional and shall not be subject to (and Lessee hereby
waives and agrees not to assert) any existing or future abatement, reduction,
setoff, defense, counterclaim or recoupment (collectively, “ \*\*Abatements\*\* ”)
for any reason or under any circumstance whatsoever as to any such Rent; (b)
it will pay all such Rent regardless of any Abatement; and (c) this Lease, and
Lessee’s payment and other obligations hereunder and under the other
Transaction Documents, are non-cancelable and non-terminable by Lessee (except
as expressly provided in any Addendum).
(Aircraft Lease MSN 42000181) | 497 |
agreement_2.md | \*\*SECTION 3\. QUIET ENJOYMENT; DISCLAIMERS\*\*. (a) Lessor warrants that
during the Term, so long as no Default or Event of Default has occurred and is
continuing, Lessee’s possession and use of the Aircraft shall not be
interfered with by Lessor or anyone rightfully claiming an interest by or
through Lessor. (b)(i) LESSOR SHALL NOT BE DEEMED TO HAVE MADE, AND LESSOR
SHALL BE DEEMED TO HAVE DISCLAIMED, ANY REPRESENTATION OR WARRANTY, EITHER
EXPRESS OR IMPLIED, AS TO THE AIRCRAFT, INCLUDING ANY ENGINE, PART OR RECORD,
OR ANY MATTER WHATSOEVER, INCLUDING, THE AIRCRAFT’S DESIGN, CONDITION,
MERCHANTABILITY, FITNESS FOR ANY PARTICULAR PURPOSE, TITLE, ABSENCE OF ANY
PATENT, TRADEMARK OR COPYRIGHT INFRINGEMENT OR LATENT DEFECT (WHETHER OR NOT
DISCOVERABLE BY LESSEE), COMPLIANCE OF THE AIRCRAFT WITH ANY APPLICABLE LAW,
CONFORMITY OF THE AIRCRAFT TO THE PROVISIONS AND SPECIFICATIONS OF ANY
PURCHASE DOCUMENT OR TO THE DESCRIPTION SET FORTH IN ANY OF THE LEASE
DOCUMENTS, OR ANY INTERFERENCE OR INFRINGEMENT, OR ARISING FROM ANY DEFECTS OR
FROM ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR USAGE OF TRADE, NOR
LESSOR BE LIABLE, FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL
DAMAGES OR FOR STRICT OR ABSOLUTE LIABILITY IN TORT; AND LESSEE HEREBY WAIVES
ANY CLAIMS ARISING OUT OF ANY OF THE FOREGOING. (ii) Without limiting the
foregoing, (A) Lessor will not be responsible to Lessee or any other Person
with respect to, and Lessee agrees to bear sole responsibility for, any risk | 498 |
agreement_2.md | with respect to, and Lessee agrees to bear sole responsibility for, any risk
or other matter that is the subject of Lessor’s disclaimer; (B) Lessee may
exercise Lessor’s rights, if any, under any warranty of Manufacturer or
Supplier with respect to the Aircraft; except that Lessee’s exercise of such
rights (1) shall be at its sole cost and risk, (2) shall not result in any
prejudice to Lessor, (3) shall not be enforced by legal proceeding without
Lessor’s prior written consent, and (4) may be exercised unless and until the
Aircraft is returned to Lessor pursuant to this Lease, and only so long as no
Default or Event of Default has occurred and is continuing; and (C) Lessee
hereby agrees that Lessor’s warranty in clause (a) above, and Lessee’s rights
pursuant to sub-clause (B), are in lieu of any other representations or
warranties by Lessor, express or implied, all of which have been effectively
disclaimed and waived pursuant to this Section 3. | 499 |