Common use of Return Condition Adjustment Clause in Contracts

Return Condition Adjustment. (a) Each item referred to in Sections 2(c), 2(d), 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an Equivalency Payment in accordance with the following formula: [*] The components of the formula above shall be as agreed between Lessor and Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States. If the prices of such quotations differ by more than [*], Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (c) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted] (e) Notwithstanding the Equivalency Payment that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has less than the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redelivery, (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redelivery, (iii) The APU has remaining less than one year of the expected life before removal, (iv) The main landing gear or the nose landing gear has less than the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, the cycles exceed one hundred and ten percent (110%) of the airframe cycles, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redelivery, then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each If the Lessee does not meet the conditions set forth for an item referred to in Sections 2(c), 2(d)2, 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an equivalency payment (the "Equivalency Payment Payment") in accordance with the following formula: [*] The components of the formula above shall be as agreed between Lessor and Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1Exhibit, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States. If the prices of such quotations differ by more than [*]ten percent (10%), Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (cb) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative --------- * Confidential Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted] (e) Notwithstanding the Equivalency Payment that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has less than the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redelivery, (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redelivery, (iii) The APU has remaining less than one year of the expected life before removal, (iv) The main landing gear or the nose landing gear has less than the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, the cycles exceed one hundred and ten percent (110%) of the airframe cycles, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redelivery, then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each If the Lessee does not meet the conditions set forth for an item referred to in Sections 2(c), 2(d)2, 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an equivalency payment (the "Equivalency Payment Payment") in accordance with the following formula: [*] --------- * Confidential [*] The components of the formula above shall be as agreed between Lessor and Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1F-1, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States. If the prices of such quotations differ by more than [*]ten percent (10%), Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (cb) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted] (e) Notwithstanding the Equivalency Payment that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has less than the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redelivery, (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redelivery, (iii) The APU has remaining less than one year of the expected life before removal, (iv) The main landing gear or the nose landing gear has less than the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, the cycles exceed one hundred and ten percent (110%) of the airframe cycles, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redelivery, then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each item referred to in Sections 2(c), 2(d), 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an Equivalency Payment in accordance with the following formula: [*] The components of the formula above shall be as agreed between Lessor and the Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1Exhibit, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 EMB- 145 repair station in the United States. If the prices of such quotations differ by more xxxx xxxxxxxxxx xxxxxx xx xxxx than [*]ten percent (10%), Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two ---------- * Confidential remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (c) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted]In no event shall the Equivalency Payment due from the Lessee to the Manufacturer exceed the aggregate amount of any payment and expenses that the Manufacturer may make under the Residual Value Guarantee Agreement. (e) Notwithstanding the Equivalency Payment equivalency charges that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has completed more than 3,750 flight hours since new or since its last full performance restoration shop visit at which it was subject to a full engine management program rework (or less than twenty-five percent (25%) of the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redeliveryan amended RR Allison shop workscope guide), (ii) Any Engine life Enxxxx xxxx limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redeliverytwenty five percent (25%), (iii) The APU has remaining less than one year twenty five (25%) of the expected life mean time before removal, (iv) The main landing gear or the nose landing gear has less than twenty five percent (25%) of the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, or the cycles exceed one hundred and ten percent (110%) of the airframe cyclesairframe, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redeliverytwenty five percent (25%), then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each item referred to in Sections 2(c)2.c, 2(d)2.d, 3, the first two lines of Section 4 and in Section 4(a) 4.a and 4(e) 4.e (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then then, on the Return Date, Lessee shall pay to the Lessor (or its designee) (for deficient condition) an Equivalency Payment in accordance with the following formula: [*] The components of the formula above shall be as agreed between Lessor (or its designee) and the Lessee. If Lessor (or its designee) and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under set forth in the Lease and this Exhibit D-1herein, based on one quotation obtained by Lessor (or its designee) and one quotation obtained by Lessee, both from a reputable, FAA FAA, Manufacturer, and Manufacturer-approved Lessor (or its designee)-approved, EMB-145 repair station in the United StatesUSA. If the prices of such quotations differ by more than [*]ten percent (10%), Lessor (or its designee) and Lessee shall obtain a third quotation from a another reputable, FAA FAA, Manufacturer and Manufacturer-approved Lessor (or its designee)-approved, EMB-145 repair station in the United StatesUSA, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor (or its designee) and Lessee as the components of the formula.. -------------------- * Confidential (c) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted]In no event shall the Equivalency Payment due from the Lessee to Lessor exceed the aggregate amount of any payment and expenses that Embraer may make under the Residual Value Guaranty. (e) Notwithstanding the Equivalency Payment equivalency charges that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has completed more than 3,750 flight hours since new or since its last full performance restoration shop visit at which it was subject to a full engine management program rework (or less than twenty-five percent (25%) of the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redeliveryan amended XX Xxxxxxx shop workscope guide), (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redeliverytwenty five percent (25%), (iii) The APU has remaining less than one year twenty five (25%) of the expected life mean time before removal,; (iv) The main landing gear or the nose landing gear has less than twenty five percent (25%) of the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, or the cycles exceed one hundred and ten percent (110%) of the airframe cyclesairframe, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break brake pressure, or the tires have a remaining useful life of less than one year after the date of redeliverytwenty five percent (25%), xv then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each item referred to in Sections 2(c), 2(d), 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an Equivalency Payment in accordance with the following formula: [*] -------- * Confidential [*] The components of the formula above shall be as agreed between Lessor and the Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1F-2, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States. If the prices of such quotations differ by more than [*]ten percent (10%), Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (c) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted]In no event shall the Equivalency Payment due from the Lessee to the Manufacturer exceed the aggregate amount of any payment and expenses that the Manufacturer may make under the Residual Value Guarantee Agreement. (e) Notwithstanding the Equivalency Payment equivalency charges that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has completed more than 3,750 flight hours since new or since its last full performance restoration shop visit at which it was subject to a full engine management program rework ---------- * Confidential Page 10 (or less than twenty-five percent (25%) of the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redeliveryan amended XX Xxxxxxx shop workscope guide), (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redeliverytwenty five percent (25%), (iii) The APU has remaining less than one year twenty five (25%) of the expected life mean time before removal, (iv) The main landing gear or the nose landing gear has less than twenty five percent (25%) of the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, or the cycles exceed one hundred and ten percent (110%) of the airframe cyclesairframe, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redeliverytwenty five percent (25%), then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.

Return Condition Adjustment. (a) Each item referred to in Sections 2(c), 2(d), 3, the first two lines of Section 4 and in Section 4(a) and 4(e) (each such item, an "Adjustable Item" and each such section, an "Adjustable Return Condition") may be returned with less than the required limits, subject, however, to the minimum requirements set forth in item (e) below. (b) If the Lessee does not meet the conditions set forth for an Adjustable Item in the relevant Adjustable Return Condition then Lessee shall pay to the Lessor (for deficient condition) an Equivalency Payment in accordance with the following formula: [*] -------- * Confidential [*] The components of the formula above shall be as agreed between Lessor and the Lessee. If Lessor and the Lessee fail to reach agreement on any components of the above formula, such amount will be determined as the average price that would be charged by a third party to restore the Aircraft to the conditions required under the Lease and this Exhibit D-1F-2, based on one quotation obtained by Lessor and one quotation obtained by Lessee, both from a reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States. If the prices of such quotations differ by more than [*]ten percent (10%), Lessor and Lessee shall obtain a third quotation from another reputable, FAA and Manufacturer-approved EMB-145 repair station in the United States, the quotation which is farthest from the average of all three quotations shall be disregarded and the average of the two remaining quotations shall be binding upon Lessor and Lessee as the components of the formula. (c) The Equivalency Payment for each return condition of each Adjustable Item in the relevant Section referred to in the first paragraph of this Section 6, whether positive or negative, shall be aggregated in order to determine the total Equivalency Payment due from Lessee. (For clarification, items in more than the ---------- * Confidential required condition shall be netted against items in less than the required condition when determining the amount of the total payment due, provided however that such netting is only applicable to the following major components: Engines, APU and landing gear). If the cumulative Equivalency Payment after such netting is negative, it shall be deemed to be zero. (d) [intentionally omitted]In no event shall the Equivalency Payment due from the Lessee to the Manufacturer exceed the aggregate amount of any payment and expenses that the Manufacturer may make under the Residual Value Guarantee Agreement. (e) Notwithstanding the Equivalency Payment equivalency charges that may be otherwise payable or available under this Section 6, if: (i) Any installed Engine has completed more than 3,750 flight hours since new or since its last full performance restoration shop visit at which it was subject to a full engine management program rework ---------- * Confidential Page 10 (or less than twenty-five percent (25%) of the number of on-wing hours remaining before overhaul or major refurbishment, in accordance with the Maintenance Program, for such overhaul or major refurbishment to be scheduled not earlier than one year after the date of redeliveryan amended RR Allison shop workscope guide), (ii) Any Engine life limited part has a remaining useful life until the next scheduled replacement of not less than one year after the date of redeliverytwenty five percent (25%), (iii) The APU has remaining less than one year twenty five (25%) of the expected life mean time before removal, (iv) The main landing gear or the nose landing gear has less than twenty five percent (25%) of the number of cycles remaining prior to removal for overhaul, for such removal for overhaul to be scheduled not earlier than one year after the date of redelivery or, or the cycles exceed one hundred and ten percent (110%) of the airframe cyclesairframe, or (v) The brakes have less than the C check brake wear limits with the brakes set at normal parking break pressure, or the tires have a remaining useful life of less than one year after the date of redeliverytwenty five percent (25%), then, in any such case, Lessee shall, at its own cost and expense, overhaul, refurbish and/or replace each non-complying item so that it meets the applicable level specified in items (i) through (v) above. For avoidance of doubt, this Section 6 shall be applicable whether or not the Engines, APU or any other hour or cycle controlled component is maintained under a PBH Agreement, as contemplated by Section 5.