Common use of Junior Loans Clause in Contracts

Junior Loans. Senior Lender hereby acknowledges that (i) no Junior Borrower will ever have any liability or obligation whatsoever with respect to the Senior Note or otherwise in connection with the payment of the Senior Loan; (ii) the Senior Loan does not constitute or impose, and shall not be deemed or construed as constituting or imposing now or hereafter, a lien or encumbrance upon, or security interest in any portion of the Separate Collateral securing any Junior Loan, and the Separate Collateral securing any Junior Loan is not collateral for the Senior Loan; (iii) the Senior Loan does not grant to Senior Lender the status of a creditor of any Junior Borrower; (iv) Senior Lender shall not assert, claim, or raise as a defense, any such lien, encumbrance, or security interest in the Separate Collateral securing any Junior Loan; (v) Senior Lender shall not assert, claim, or raise as a defense any status as a creditor of any Junior Borrower in any action or proceeding, including any Proceeding commenced by or against any Junior Borrower; (vi) Senior Lender shall not assert, pursue, confirm, or acquiesce in any way to any recharacterization of the Senior Loan as having conferred upon Senior Lender any lien or encumbrance upon, or security interest in, the Separate Collateral securing any Junior Loan or as having conferred upon Senior Lender the status of a creditor of any Junior Borrower, and (vii) Junior Lenders may obtain title to their respective Separate Collateral subject to the terms of Section 6 and Senior Lender hereby consents thereto. Notwithstanding any provisions herein to the contrary, Senior Lender agrees that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under the Senior Loan Documents, entitle Senior Lender to accelerate payments under the Senior Loan Documents or entitle Senior Lender to modify any provisions of the Senior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Loan Documents as provided for therein. Notwithstanding any provisions herein to the contrary, Senior Junior Lenders agree that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under the Senior Junior Loan Documents, entitle any Senior Junior Lender to accelerate payments under the Senior Loan Documents or entitle any Senior Lender to modify any provisions of the Senior Junior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Junior Loan Documents as provided for therein.

Junior Loans. Notwithstanding anything to the contrary in any Operative Agreement upon not less than 30 days’ prior written notice to the parties hereto, Borrower shall have the right to issue, at any time prior to March 1, 2009, additional debt secured by a Lien on any Aircraft junior to the Lien of the Applicable Mortgage (a “Junior Loan”); provided, that Borrower shall be entitled at any time following the Applicable Closing Date of any Aircraft, to obtain a Junior Loan which finances the acquisition and installation of winglets to be installed on such Aircraft, provided, such winglets are owned by Borrower and, following installation thereof, are subject to the Lien of the Applicable Mortgage. In connection with any such Junior Loan, each of the parties hereto (or their successors) and the lender(s) providing such Junior Loan (and the related mortgagee) will execute and deliver an intercreditor agreement in form and substance reasonably satisfactory to the parties hereto (or their successors) and the lender(s) providing such Junior Loan, which agreement shall, among other things, ensure there is no diminution of the Applicable Mortgagee’s priority and perfected Lien in such Aircraft and all other then-existing Collateral (as defined in the Applicable Mortgage). In connection with any such Junior Loan, in no event will the Lenders be required to agree to: (a) payment cure rights that would forestall their ability to take action for more than one year; (b) convey control over remedies following an Event of Default to the lender(s) providing such Junior Loan (or to the related mortgagee); and (c) any buyout right that would not cover outstanding principal, accrued interest, any LIBOR Breakage Amount and all other amounts due and owing to the applicable Lenders under the Applicable Operative Agreements (the “Applicable Senior Lender hereby acknowledges that Debt”). In addition the holders of the Junior Loan will (i) no Junior Borrower will ever have any liability or obligation whatsoever with respect fully subordinate the entirety of their claims to the Applicable Senior Note or otherwise Debt as it relates to the Collateral and (ii) not be entitled to exercise any remedies against the Applicable Aircraft and related Collateral so long as the Applicable Senior Debt is outstanding. Borrower shall reimburse the Applicable Mortgagee and the Lenders for all of their reasonable out-of-pocket fees and expenses (including reasonable fees and disbursements of counsel) incurred in connection with the payment of the Senior Loan; (ii) the Senior documenting any such Junior Loan does not constitute or impose, and intercreditor agreement and shall not be deemed or construed as constituting or imposing now or hereafter, a lien or encumbrance upon, or security interest in any portion of the Separate Collateral securing any Junior Loan, and the Separate Collateral securing any Junior Loan is not collateral for the Senior Loan; (iii) the Senior Loan does not grant to Senior Lender the status of a creditor of any Junior Borrower; (iv) Senior Lender shall not assert, claim, or raise as a defense, any such lien, encumbrance, or security interest in the Separate Collateral securing any Junior Loan; (v) Senior Lender shall not assert, claim, or raise as a defense any status as a creditor of any Junior Borrower in any action or proceeding, including any Proceeding commenced by or against any Junior Borrower; (vi) Senior Lender shall not assert, pursue, confirm, or acquiesce in any way to any recharacterization of the Senior Loan as having conferred upon Senior Lender any lien or encumbrance upon, or security interest in, the Separate Collateral securing any Junior Loan or as having conferred upon Senior Lender the status of a creditor of any Junior Borrower, and (vii) Junior Lenders may obtain title to their respective Separate Collateral subject pay to the terms of Section 6 and Senior Lender hereby consents thereto. Notwithstanding any provisions herein Applicable Mortgagee the Working Fee to be distributed by the Applicable Mortgagee to the contrary, Senior Lender agrees that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under relevant Lenders as directed by the Senior Loan Documents, entitle Senior Lender to accelerate payments under the Senior Loan Documents or entitle Senior Lender to modify any provisions of the Senior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Loan Documents as provided for therein. Notwithstanding any provisions herein to the contrary, Senior Junior Lenders agree that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under the Senior Junior Loan Documents, entitle any Senior Junior Lender to accelerate payments under the Senior Loan Documents or entitle any Senior Lender to modify any provisions of the Senior Junior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Junior Loan Documents as provided for thereinInitial Lender.

Junior Loans. Notwithstanding anything to the contrary in any Operative Agreement upon not less than 30 days’ prior written notice to the parties hereto, Borrower shall have the right to issue, at any time prior to the second (2nd) anniversary of the Applicable Closing Date, additional debt secured by a Lien on any Aircraft junior to the Lien of the Applicable Mortgage (a “Junior Loan”). In connection with any such Junior Loan, each of the parties hereto (or their successors) and the lender(s) providing such Junior Loan (and the related mortgagee) will execute and deliver an intercreditor agreement in form and substance reasonably satisfactory to the parties hereto (or their successors) and the lender(s) providing such Junior Loan, which agreement shall, among other things, ensure there is no diminution of the Applicable Mortgagee’s priority and perfected Lien in such Aircraft and all other then-existing Collateral (as defined in the Applicable Mortgage). In connection with any such Junior Loan the security and credit position of the Applicable Lenders will not be adversely affected and the rights of the holders of the Junior Loans vis a vis the Applicable Lenders will be limited to any buyout right that would cover outstanding principal, accrued interest, any LIBOR Breakage Amount and all other amounts due and owing to the applicable Lenders under the Applicable Operative Agreements (the “Applicable Senior Lender hereby acknowledges that Debt”). In addition the holders of the Junior Loan will (i) no fully subordinate the entirety of their claims to the Applicable Senior Debt as it relates to the Collateral and (ii) not be entitled to exercise any remedies against the Applicable Aircraft and related Collateral so long as the Applicable Senior Debt is outstanding. Borrower shall reimburse the Applicable Mortgagee and the Lenders for all of their reasonable out-of-pocket fees and expenses (including reasonable fees and disbursements of counsel) incurred in connection with documenting any such Junior Borrower will ever have any liability or obligation whatsoever Loan and intercreditor agreement, and with respect to the Senior Note or otherwise in connection with the payment of the Senior Loan; (ii) the Senior Loan does not constitute or impose, and shall not be deemed or construed as constituting or imposing now or hereafter, a lien or encumbrance upon, or security interest in any portion of the Separate Collateral securing any Junior Loan, and the Separate Collateral securing any Junior Loan that is not collateral for consummated after the Senior Loan; (iii) the Senior Loan does not grant to Senior Lender the status of a creditor of any Junior Borrower; (iv) Senior Lender Applicable Closing Date, Borrower shall not assert, claim, or raise as a defense, any such lien, encumbrance, or security interest in the Separate Collateral securing any Junior Loan; (v) Senior Lender shall not assert, claim, or raise as a defense any status as a creditor of any Junior Borrower in any action or proceeding, including any Proceeding commenced by or against any Junior Borrower; (vi) Senior Lender shall not assert, pursue, confirm, or acquiesce in any way to any recharacterization of the Senior Loan as having conferred upon Senior Lender any lien or encumbrance upon, or security interest in, the Separate Collateral securing any Junior Loan or as having conferred upon Senior Lender the status of a creditor of any Junior Borrower, and (vii) Junior Lenders may obtain title to their respective Separate Collateral subject pay to the terms of Section 6 and Senior Lender hereby consents thereto. Notwithstanding any provisions herein Applicable Mortgagee the Working Fee to be distributed by the Applicable Mortgagee to the contrary, Senior Lender agrees that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under Applicable Lenders as directed by the Senior Loan Documents, entitle Senior Lender to accelerate payments under the Senior Loan Documents or entitle Senior Lender to modify any provisions of the Senior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Loan Documents as provided for therein. Notwithstanding any provisions herein to the contrary, Senior Junior Lenders agree that no default or Event of Default under any Junior Loan Documents shall, in and of itself, constitute or give rise to a default or Event of Default under the Senior Junior Loan Documents, entitle any Senior Junior Lender to accelerate payments under the Senior Loan Documents or entitle any Senior Lender to modify any provisions of the Senior Junior Loan Documents; provided, however, the circumstances giving rise to a default or Event of Default under any Junior Loan Documents may independently give rise to a default or Event of Default under the Senior Junior Loan Documents as provided for thereinApplicable Lenders.