Common use of Terms of Insurance Policies Clause in Contracts

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee as loss payee to the extent provided in Section B.1, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Mortgagee as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in if the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); , provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Owner (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorOwner (or any Permitted Lessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor Owner has agreed in the Loan Documents Operative Agreements to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Owner (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeMortgagee), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iii) below, in the event of a loss involving proceeds in excess of $5,000,000, all proceeds in respect of such loss up to the amount of the Agreed Value shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Mortgagee to be held by the Mortgagee (whether such payment is made to the Owner (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Mortgagee otherwise than in respect of an Event of Loss of the Aircraft, the Mortgagee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Owner or its order, (ii) belowexcept as specified in the following clause (iii), all proceeds of $5,000,000 or less (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of the Agreed Value shall be paid to the Grantor Owner or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to a Special Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeMortgagee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement Mortgagee and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 AVS103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A 6.01 and B hereof 6.02 covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Administrative Agent (on behalf of the Lenders) as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section 6.04, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketobtainable, (45) shall provide that in respect of the Additional Insureds’ ' respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Borrower and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorBorrower, (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, thereof shall operate in the same manner as if a separate policy covered each insured, it being understood that the total liability of insurers in respect of any or all insureds shall not exceed the policy limits of liability, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredInsured but only to the extent of the indemnities provided under the Credit Agreement, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Borrower (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeAdministrative Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) belowof this sub-section, in the event of a loss involving payments in excess of $750,000, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is made to the Borrower or any loss third party) shall be paid to the Grantor Administrative Agent on behalf of the Lenders, it being understood and agreed that in the case of any payment to the Administrative Agent otherwise than in respect of an Event of Loss of the Aircraft, the Administrative Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Borrower or its order, (ii) except as specified in clause (iii) of this sub-section, all proceeds of $750,000 or less (regardless of the total amount of proceeds resulting from such loss) and any payments of any loss in excess of Stipulated Insured Amount for the Aircraft shall be paid to the Borrower or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeAdministrative Agent, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Administrative Agent, (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 103, and (14) if the policy (or its equivalent)policies) contains (or contain) an electronic date recognition exclusion such as AVN 2000, to include AVN 2001 and AVN 2002 or such other writebacks for hull and liability coverage as are customary for commercial airlines in the United States.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Collateral Agent as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in if the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); , provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liabilityliability and agreed value, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor Company has agreed in the Loan Documents Operative Agreements to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Company (or, if a Special Default or an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeCollateral Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iii) below, in the event of (x) a loss in respect of an Engine (under circumstances in which an Event of Loss with respect to an Airframe has not occurred) or a Spare Engine involving proceeds in excess of $2,500,000 or (y) any other loss involving proceeds in excess of $5,000,000, in each case, all proceeds in respect of such loss up to the amount of the Agreed Value shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Collateral Agent to be held by the Collateral Agent (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Collateral Agent otherwise than in respect of an Event of Loss of the Aircraft, the Collateral Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, to the extent not theretofore applied as provided in the C Mortgage, and any interest or income earned thereon, to the Company or its order, (ii) belowexcept as specified in the following clause (iii), all proceeds of (x) a loss in respect of an Engine (under circumstances in which an Event of Loss with respect to an Airframe has not occurred) or a Spare Engine of $2,500,000 or less or (y) any other loss of $5,000,000 or less, in each case, regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of the Agreed Value shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeCollateral Agent, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement Collateral Agent and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 AVS103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Mortgagee as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); , provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Owner (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorOwner (or any Permitted Lessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor Owner has agreed in the Loan Documents Operative Agreements to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Owner (or, if a Special Default or an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeMortgagee), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iii) below, in the event of a loss involving proceeds in excess of $5,000,000, all proceeds in respect of such loss up to the amount of the Agreed Value shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Mortgagee to be held by the Mortgagee (whether such payment is made to the Owner (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Mortgagee otherwise than in respect of an Event of Loss of the Aircraft, the Mortgagee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, to the extent not theretofore applied as provided in the Trust Indenture, and any interest or income earned thereon, to the Owner or its order, (ii) belowexcept as specified in the following clause (iii), all proceeds of $5,000,000 or less (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of the Agreed Value shall be paid to the Grantor Owner or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeMortgagee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement Mortgagee and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 AVS103 (or its equivalent).

Terms of Insurance Policies. Any insurance policies carried in accordance with Sections A and B hereof covering the Engines, Collateral (and any policies taken out in substitution or replacement for any such policies, as applicable, ) (1i) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2ii) shall name the Security Trustee Collateral Agent as sole loss payee in respect of any casualty insurance maintained with respect to Collateral; provided, so long as the Insurers shall not have received notice of a Specified Default or an Event of Default, in respect of any casualty occurrence the insurance proceeds of which are less than $1,000,000, such insurance proceeds shall be paid directly to such Grantor, (iii) may provide for self-insurance to the extent provided permitted in Section B.13.04(d) hereof, (3iv) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten twenty (1020) days in the case of nonpayment lapse for non-payment of premiumpremiums and seven (7) after sending to (but, days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of if the war risk and allied perils coveragenotice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4v) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the such Grantor or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantorsuch Grantor or by any other Person, (5vi) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6vii) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insuredAdditional Insured, (7viii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engineix) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent waive any right of the Security Trustee)insurers to subrogation against any Additional Insured, and (9x) shall provide for a 50/50 claims settlement per AVS 103 or its equivalent, except that the Additional Insureds are not liable for any insurance premiumsif coverage required under this Section 3.04 is then being provided under Section 3.04(f), (10) such claims settlement shall be effective made pursuant to provisions then generally in effect with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)commercial aviation insurance.

Terms of Insurance Policies. Any insurance policies carried in accordance with Sections A and B Section 20.1(a) hereof covering the EnginesEquipment, and any policies taken out in substitution or replacement for any such policies, as applicable, (1i) in the case of Section Aproperty insurance, shall name the Security Indenture Trustee and each other Secured Party (collectivelyas the loss payee with respect to the Equipment so long as the Indenture has not been discharged in accordance with its terms and, if the “Additional Insureds”) as additional insuredsIndenture has been so discharged, as their interests may appear, (2) shall name the Security Owner Trustee as the loss payee with respect to the Equipment, (ii) in the case of liability insurance, shall name the Lessor Parties as additional insureds (the "Additional Insureds"), (iii) may provide for self-insurance to the extent provided permitted in Section B.120.1(c) hereof, (3iv) shall be primary without any right of contribution from any other insurance which is carried by or may be available to protect the Additional Insureds, (v) shall provide that in respect of the Additional Insureds' interest in such policies the insurance shall not be invalidated by any action or inaction of the Lessee and shall insure the respective interests of the Additional Insureds regardless of any breach or violation by the Lessee of any warranty, declaration or condition contained in such policy (except for nonpayment of premiums), (vi) shall provide that the Additional Insureds are not liable for any insurance premiums, (vii) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the such insurance which adversely affects the interest interests of any Additional Insured, or if such insurance lapses, such cancellation, lapse, change or change lapse shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) 10 days in the case of cancellation or lapse for nonpayment of premiumpremiums) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) receipt by the Additional Insureds of written notice by such insurers of such cancellation cancellation, change or change lapse, (orviii) shall otherwise contain terms and conditions, including without limitation, the payment of deductible in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, howeverconnection with any such insurance, that ifare reasonably satisfactory to the Lessor Parties, in respect of the war risk and allied perils coverage, such policies (ix) shall provide for such shorter period as may be available in each insurer's waiver of its right of subrogation against the international insurance marketLessor, and (4x) shall provide that in respect for liability insurance having "cross-liability" and "severability of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)interest" endorsements.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 11(a) and B 11(b) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, or, if appropriate, loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.111(d) hereof, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) days in the case of lapse for nonpayment of premium) after sending to (but, premium and seven days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee (or any Sublessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorLessee (or any Sublessee) or by any other Person, (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, and (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9H) shall provide that (i) in the Additional Insureds event of a loss involving the Aircraft, Airframe, or an Engine for which proceeds are not liable in excess of $3,000,000, the proceeds in respect of such loss up to the amount of Stipulated Loss Value for any insurance premiums, (10) the Aircraft shall be effective with payable to Lessor (or, so long as the Trust Indenture shall be in effect, the Indenture Trustee), it being understood and agreed that in the case of any payment to Lessor (or the Indenture Trustee) otherwise than in respect to both domestic and international operations, (11) shall provide that for any loss not constituting of an Event of Loss (i) except as specified in clause (ii) belowLoss, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 Lessor (or its equivalent).the Indenture Trustee) shall, upon receipt of evidence reasonably

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Aircraft and the Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee Senior Secured Party, the Lenders, the Secured Party and each other Secured Party of the Beneficiaries (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) in the case of hull insurance, shall name the Security Trustee Senior Secured Party (until the Lien of the Senior Mortgage shall have been discharged) and the Secured Party (from and after the time that the Lien of the Senior Mortgage shall have been discharged) as sole loss payee to the extent provided in Section B.1clause (12) below, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending issuance to (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor Company (or, if an Event of Default or Special Default shall have occurred which is continuing, with the consent Senior Secured Party (until the Lien of the Security TrusteeSenior Mortgage shall have been discharged) and the Secured Party (from and after the time that the Lien of the Senior Mortgage shall have been discharged)), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) below, in the event of a loss involving proceeds in excess of the Threshold Amount, all proceeds in respect of such loss up to the amount of Termination Value for an affected Engine shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Senior Secured Party (until the Lien of the Senior Mortgage shall have been discharged) and the Secured Party (from and after the time that the Lien of the Senior Mortgage shall have been discharged) to be held by such Person (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Secured Party otherwise than in respect of an Event of Loss of the Engine, the Secured Party shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Company or its order, (ii) except as specified in the following clause (iii), all proceeds equal to or less than the Threshold Amount (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of Termination Value for the Engine suffering such loss shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to a Special Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeSecured Party, all proceeds of loss shall be paid to the Security Trustee for application in accordance with Senior Secured Party (until the Credit Agreement Lien of the Senior Mortgage shall have been discharged) and the Secured Party (from and after the time that the Lien of the Senior Mortgage shall have been discharged), (12) if separate hull and war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 103, (or its equivalent)13) shall operate on a worldwide basis subject to certain territorial restrictions which are usual and customary in the War Risks market from time to time and (14) shall contain a provision entitling the Secured Party to initiate a claim if an Event of Default shall be continuing.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Airframes and Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee Administrative Agent and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee Administrative Agent as loss payee to the extent provided in Section B.1, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, lapse or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); , provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter as long a period of prior notice as may be available in the international insurance marketavailable, (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorGrantor (or any Permitted Lessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that Mortgage and Security Agreement 1005973744v2 all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, but in each case only to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds (8) 9) shall provide that losses (other than for total loss of an Airframe or Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeAdministrative Agent (such consent not to be unreasonably withheld or delayed)), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee Administrative Agent is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee Administrative Agent for prompt deposit into the Collateral Proceeds Account pursuant to Section B.1, and the insurers have been so notified thereof by the Security TrusteeAdministrative Agent, all proceeds of loss shall be paid to the Security Trustee Administrative Agent for application in accordance with prompt deposit into the Credit Agreement Collateral Proceeds Account and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A SECTION 2.04(A) and B SECTION 2.04(b) hereof covering the Enginesapplicable Collateral, and any policies taken out in substitution or replacement for any such policies, as applicable, (1i) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2ii) shall name the Security Trustee Collateral Agent as sole loss payee in respect of insurances maintained pursuant to SECTION 2.04(B); provided, Default, in respect of any casualty occurrence the insurance proceedsof which are less than $2,000,000, such insurance proceeds shall be paid directly to the Company, (iii) may provide for self-insurance to the extent provided permitted in Section B.1SECTION 2.04(D) hereof, (3iv) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten twenty (1020) days in the case of nonpayment lapse for non-payment of premiumpremiums and seven (7) after sending to (but, days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of if the war risk and allied perils coveragenotice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4v) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany or by any other Person, (5vi) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6vii) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insuredAdditional Insured, (7viii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engineix) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent waive any right of the Security Trustee)insurers to subrogation against any Additional Insured, and (9x) shall provide for a 50/50 claims settlement per AVS 103 or its equivalent, except that the Additional Insureds are not liable for any insurance premiumsif coverage required under this SECTION 2.04 is then being provided under SECTION 2.04(F), (10) such claims settlement shall be effective made pursuant to provisions then generally in effect with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)commercial aviation insurance.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Aircraft and the Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party and the Lenders (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) in the case of hull insurance, shall name the Security Trustee Secured Party as sole loss payee to the extent provided in Section B.1clause (12) below, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending issuance to (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor Company (or, if an Event of Default or Special Default shall have occurred which is continuing, with the consent of the Security TrusteeSecured Party), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) below, in the event of a loss involving proceeds in excess of the Threshold Amount, all proceeds in respect of such loss up to the amount of Termination Value for an affected Engine shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Secured Party to be held by the Secured Party (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Secured Party otherwise than in respect of an Event of Loss of the Engine, the Secured Party shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Company or its order, (ii) except as specified in the following clause (iii), all proceeds equal to or less than the Threshold Amount (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of Termination Value for the Engine suffering such loss shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to a Special Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeSecured Party, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Secured Party, (12) if separate hull and war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 103, (or its equivalent)13) shall operate on a worldwide basis subject to certain territorial restrictions which are usual and customary in the War Risks market from time to time and (14) shall contain a provision entitling the Secured Party to initiate a claim if an Event of Default shall be continuing.

Terms of Insurance Policies. Any policies carried in accordance ----------------------------- with Sections A 11(a) and B 11(b) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1i) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, and, as appropriate, loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums, calls or other charges with respect to such insurance), (2ii) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.111(d) hereof, (3iii) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional InsuredInsured under this Lease Agreement, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, Federal Express Boeing 727-2D4 N362PA in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified -------- ------- above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4iv) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured under this Lease Agreement in such policies the insurance shall not be invalidated by any action or inaction of Lessee or, in the Grantor case of any particular Additional Insured, the action or inaction of any other Additional Insured and shall insure the respective interests of the Additional Insureds Insureds, as they appear under this Lease Agreement, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by Lessee or, in the Grantorcase of an Additional Insured, the breach or violation by any other Additional Insured, (5v) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6vi) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7vii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any ,liability of any Additional Insured, and (8) viii) shall provide that losses (other than A) in the event of a loss involving the Aircraft, Airframe or an Engine for total loss which proceeds are in excess of an Engine) shall be adjusted with the Grantor $1,000,000 (or, if the Aircraft is then under a Sublease, in excess of $500,000), the proceeds in respect of such loss up to the amount of Stipulated Loss Value for the Aircraft shall be payable to Lessor, it being understood and agreed that in the case of any payment to Lessor otherwise than in respect of an Event of Loss, Lessor shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 21 hereof, to Lessee or its order, and (B) the entire amount of any such loss for which proceeds are $1, 000, 000 (or, if the Aircraft is then under a Sublease, are $500,000 or less or the amount of any proceeds of any such loss in excess of Stipulated Loss Value for the Aircraft shall be paid to Lessee or its order unless a Lease Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent).Lessor. Federal Express Boeing 727-2D4 N362PA

Terms of Insurance Policies. Any insurance policies carried in accordance with Sections A and B 3.4(a) through 3.4(c) hereof covering the Engines, applicable Collateral and any other insurance policies carried in accordance with the Loan Documents (and any policies taken out in substitution or replacement for any such policies, as applicable, ) (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2i) shall name the Security Trustee Additional Insureds as additional insureds and the Collateral Agent as a loss payee as their respective interests may appear (but without imposing on any such party liability to pay premiums with respect to such insurance), (ii) may provide for self-insurance to the extent provided permitted in Section B.13.4(e) hereof, (3iii) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten twenty (1020) days in the case of nonpayment lapse for non-payment of premiumpremiums and seven (7) after sending to (but, days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4iv) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the such Grantor (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantorsuch Grantor (or any Permitted Lessee) or by any other Person, (5v) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6vi) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insuredAdditional Insured, (7vii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9viii) shall provide that in the Additional Insureds are not liable event of a loss involving an Aircraft, Airframe, Engine, Propeller or Spare Engine the proceeds in respect of such loss for any insurance premiumssuch Aircraft, Airframe, Engine, Propeller or Spare Engine shall be payable to the Collateral Agent and shall be applied in accordance with Section 2.5(c) of the Loan Agreement), (10ix) shall be effective with respect waive any right of the insurers to both domestic subrogation against any Additional Insured, and international operations, (11x) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause claims settlement per AVS 103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A 11.1 and B hereof 11.2 covering the Enginesan Aircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee Lessor and each other Secured Financing Party as additional insureds (collectively, the “"Additional Insureds”) as additional insureds"), as their interests may appear, (2) shall name the Security Trustee Administrative Agent as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section 11.4, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium whatsoever or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of any war risk and allied perils coverage, and failure to pay premium seven (7) days and ten (10) days, respectively, after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketobtainable, (45) shall provide that in respect of the Additional Insureds’ respective interests ' interest in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee (or any sublessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorLessee (or any sublessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and 8) shall waive any right of the insurers of subrogation or to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Lessee (or, if an a Lease Event of Default or Significant Default shall have occurred which is and be continuing, with the consent of the Security TrusteeAdministrative Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause subclause (ii) belowof this clause (12), in the event of a loss involving proceeds in excess of $2,000,000, all proceeds in respect of any such loss shall be paid payable to the Grantor Administrative Agent to be held by the Administrative Agent (whether such payment is made to Lessee (or its order any sublessee) or any third party) and applied in accordance with the provisions of Section 10.5 hereof, it being understood and agreed that in the case of any proceeds payable to the Administrative Agent other than in respect of an Event of Loss of the Aircraft, the Administrative Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of property, apply the amount of such proceeds in accordance with the provisions of Section 10.6, and (ii) notwithstanding anything any language to the contrary contained in the preceding clause (i)herein, if the Security Trustee is entitled to notify the insurer that such proceeds a Significant Default or Lease Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeAdministrative Agent, all proceeds of loss shall be paid payable to the Security Trustee for application in accordance with the Credit Agreement Administrative Agent and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause per AVS 103 (or its equivalent)103.

Terms of Insurance Policies. Any policies of insurance carried in accordance with this Sections A and B hereof 8.5 covering the EnginesAIA Aircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2i) shall name Agent, for and on behalf of each of the Security Trustee Lenders, and the Lenders as additional insured, with respect to liability policies, and Agent, for and on behalf of each of the Lenders as loss payee payee, with respect to casualty policies (but without imposing on any such party liability to pay premiums with respect to such insurance), (ii) may provide for self-insurance to the extent provided permitted in Section B.18.5(g), (3iii) shall provide that that, if the insurers cancel such insurance for any reason whatsoever, whatever or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional InsuredAgent, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds Agent for thirty (30) 30 days (or ten (10) except a maximum of seven days with respect to war risk coverages in the case of nonpayment of premiumaccordance with standard industry practice) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds receipt by Agent of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance marketchange, (4iv) shall provide that in respect the interests of Agent and the Additional Insureds’ respective interests Lenders in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Kitty Hawk or any of its Subsidiaries or any other Person having possession and shall insure the respective interests of Agent and the Additional Insureds Lenders, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorKitty Hawk or any of its Subsidiaries or by any such Person having possession, (5v) shall be primary without any right of contribution from any other insurance which is carried by any Additional InsuredAgent or the Lenders, (6vi) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7vii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredAgent, and (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9viii) shall provide that that, in the Additional Insureds are not liable for any insurance premiumsevent of loss involving the AIA Aircraft, (10) Agent shall be effective with respect to both domestic and international operations, (11) shall provide that sole loss payee for any loss not constituting an Event the account of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)interests.

Terms of Insurance Policies. Any policies carried in accordance --------------------------- with Sections A 4.03(a) and B 4.03(b) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, or, if appropriate (but subject to clause (H) below), loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.14.03(d) hereof, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non- payment of premium or if any [Trust Indenture and Mortgage ([_________])] material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Owner (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorOwner (or any Permitted Lessee) or by any other Person, (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, and (8) H) shall provide that losses (other i) in the event of a loss involving the Aircraft, Airframe, or an Engine for which proceeds are in excess of the Loss Payee Amount, the proceeds in respect of such loss up to the amount of the Insured Amount for the Aircraft shall be payable to the Indenture Trustee, it being understood and agreed that in the case of any payment to the Indenture Trustee otherwise than for total loss in respect of an EngineEvent of Loss, the Indenture Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damages giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 9.04 hereof, to Owner or its order, and (ii) the entire amount of any such loss for which proceeds are equal to or less than the Loss Payee Amount or the amount of any proceeds of any such loss in excess of the Insured Amount for the Aircraft shall be adjusted with the Grantor (orpaid to Owner or its order unless a Section 8.01(a)(i), if an 8.01(e) or 8.01(f) Indenture Default or any Indenture Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all Indenture Trustee in which case such proceeds of loss shall be paid payable to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Indenture Trustee.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B Section 1 hereof covering the Engineseach Engine, and any policies taken out in substitution or replacement for any such policies, as applicable, (1i) in the case of Section A, shall name the Security Trustee Seller Indemnitees and each other Secured Party (collectively, the “Additional Insureds”) parties identified below as additional insureds, as their interests may appear(but without imposing on any such party liability to pay premiums with respect to such insurance), (2) shall name the Security Trustee as loss payee to the extent provided in Section B.1, (3ii) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional InsuredSeller Indemnitee, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds any Seller Indemnitee for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance marketchange, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6iii) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a there were separate policy covered covering each insured, (7iv) shall provide that the insurers will waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff setoff, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, (v) be primary and without right of contribution from any insurance which may be carried by any Seller Indemnitees, and (vi) shall otherwise be reasonably acceptable to Seller in respect light of industry norms. The insurance required by this Exhibit C may be subject to any liability limits prevailing at the time in the aviation insurance marketplace (for example, on the date of any Additional Insuredthis Agreement, (8) AVN 67B). On or before the Delivery Date for the Engines, the Buyer shall provide that losses (other than for total loss to Seller certificates of an Engine) insurance evidencing the coverage required pursuant to this Exhibit and, if so requested by Seller, shall provide to Seller, as applicable, updated certificates of insurance upon each renewal of the coverage required pursuant to this Exhibit C. The following parties shall be adjusted included as additional insureds along with the Grantor (orother additional insureds required under this Agreement: Celestial Aviation Trading 22 Limited, if an Event of Default shall have occurred which is continuingGECAS Technical Services Limited, with the consent of the Security Trustee)GE Capital Aviation Funding, (9) shall provide that the Additional Insureds are not liable for any insurance premiumsGE Capital Aviation Services Limited, (10) shall be effective with respect to both domestic GE Capital Aviation Services LLC, General Electric Company, GE Capital Global Holdings LLC and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent).GE Capital US Holdings Inc.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B the terms hereof covering the Aircraft, Engines and Spare Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee Additional Insureds as additional insureds and (i) prior to the indefeasible payment in full of all Tranches A and B Obligations, with respect to the Tranche C Priority Collateral and (ii) thereafter, with respect to all Collateral, name the Collateral Agent as loss payee payee, as their respective interests may appear (but without imposing on any such party liability to the extent provided in Section B.1pay premiums with respect to such insurance), (3B) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any additional insured named in accordance with clause (A) (a "Named Additional Insured"), such cancellation, lapse, cancellation or change shall not be effective as to the any Named Additional Insureds Insured for thirty (30) days (or ten (10) twenty days in the case of nonpayment lapse for non-payment of premium) after sending to (but, premiums and seven days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Named Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4C) shall provide that in respect of the Additional Insureds’ respective interests of each Named Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Named Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorGrantor (or any Permitted Lessee) or by any other Person, (5D) shall be primary without any right of contribution from any other insurance which is carried by any Named Additional Insured, (6E) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7F) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Named Additional Insured, (8) G) shall specifically refer to this Section 2.03, (H) in the case of hull insurance policies carried in accordance with this Section 2.03, shall name the Collateral Agent as loss payee, (I) shall waive any right of the insurers to subrogation against any Named Additional Insured and (J) shall provide that losses for a 50/50 claims settlement per AVS 103 or its equivalent. Subject as provided in Section 2.03(h), nothing herein is intended to limit or restrict Grantor's (other than for total loss or any Permitted Lessee's) right to self-insure, to the extent of an Engine) shall be adjusted with the Grantor any applicable minimum per aircraft or engine (or, if an Event of Default shall have occurred applicable, per annum or other period), the hull or liability insurance deductible imposed by the applicable hull or liability insurer, which is continuing, are commensurate with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained standard deductibles in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee aircraft industry for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)major U.S. commercial airlines.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 5.1, 5.2 and B 5.3 hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee Additional Insureds as loss payee additional insureds (but without imposing on any such party liability to pay premiums with respect to such insurance), (B) may provide for self-insurance to the extent provided permitted in Section B.15.5, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) 30 days (or ten (10) days in the case of lapse for nonpayment of premium) after sending to (but, premiums and seven days in the case of war war-risk and allied perils coverage, seven (7) days coverage after sending to) the Additional Insureds delivery of written notice by such insurers insurer to such Additional Insured of such lapse, cancellation or change change, (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that ifD) shall provide that, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies policies, the insurance shall not be invalidated or impaired by any action or inaction of the Grantor Company or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany or by any other Person (whether occurring before or after attachment of this Mortgage or whether occurring before or after any loss or payment under such insurance), (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7) insured and shall waive any right of subrogation of the insurers against the Additional Insureds Lenders and the Mortgagee, (G) shall, with respect to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall hull insurance, waive any right of the insurers to setoff set-off (except any standard set-off for unpaid premiums), recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) H) shall specifically refer to this Article V and shall acknowledge the general indemnity set forth in the Secured Credit Agreement, (I) in the case of hull insurance policies carried in accordance with Sections 5.2 and 5.3 hereof, shall name the Mortgagee as sole loss payee (for the benefit of the Secured Parties), (J) shall contain a 50/50% clause per AVS 103 or its equivalent, and (K) shall provide that losses in the event of a partial loss involving any Aircraft, Airframe, or Engine not constituting an Event of Loss, (other than i) for total which proceeds are in excess of $*, all the proceeds in respect of such partial loss of an Engine) shall be adjusted with payable to the Grantor Mortgagee (orfor the benefit of the Secured Parties), if an it being understood and agreed that in the case of any such payment to the Mortgagee, the Mortgagee shall, upon receipt of evidence reasonably satisfactory to it and the Lenders that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment to the party having performed or performing the repairs to such Aircraft and (ii) for which proceeds are $* or less shall be paid, unless a Default or Event of Default shall have occurred which is and be continuing, with to the consent Company or its order for cost of repair of such Aircraft (it being agreed that the Security Trusteedollar amounts referred to in this clause (K) are inclusive of any applicable deductible and any self-insurance), (9L) shall provide that the Additional Insureds are insurers shall not liable for any insurance premiumsbe entitled to replace such Aircraft, (10) shall be effective with respect to both domestic and international operations, (11M) shall provide that for if a Default or Event of Default has occurred and is continuing, the Mortgagee shall be entitled to initiate claims under the policies, and (N) shall provide that in the event of a loss involving any loss not constituting Aircraft, Airframe or Airframe and Engine and the same constitutes an Event of Loss (i) except as specified in clause (ii) belowLoss, all the proceeds in respect of any loss such Event of Loss shall be paid payable to the Grantor Mortgagee (for the benefit of the Secured Parties), it being understood and agreed that, unless a Default or Event of Default shall have occurred and be continuing, the Mortgagee shall pay any amount in excess of all Secured Obligations relating to such Aircraft to the Company or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)order.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Aircraft and the Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “"Additional Insureds”") as additional insureds, as their interests may appear, (2) in the case of hull insurance, shall name the Senior Trustee (until the Lien of the Senior Mortgage shall have been discharged) and the Security Trustee (from and after the time that the Lien of the Senior Mortgage shall have been discharged) as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending issuance to (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall Company's War Risk Insurance provider does not provide for such shorter period as may be available provision of direct notice to Additional Insureds of cancellation, change or lapse in the international insurance marketrequired hereunder, the Company hereby agrees that, upon receipt of notice (including any notice by publication, if applicable) of any cancellation, change or lapse thereof from such insurance provider it shall give the Additional Insureds immediate notice of each cancellation or lapse and prompt notice of each change of such insurance, (45) shall provide that in respect of the Additional Insureds’ ' respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (56) in the case of liability insurances, shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) in the case of liability insurances, shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor Company (or, if an Event of Default or Special Default shall have occurred which is continuing, with the consent Senior Trustee (until the Lien of the Senior Mortgage shall have been discharged) and the Security TrusteeTrustee (from and after the time that the Lien of the Senior Mortgage shall have been discharged)), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) below, in the event of a loss involving proceeds in excess of the Threshold Amount, all proceeds in respect of such loss up to the amount of Stipulated Loss Value for an affected Engine shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Senior Trustee (until the Lien of the Senior Mortgage shall have been discharged) and the Security Trustee (from and after the time that the Lien of the Senior Mortgage shall have been discharged) to be held by Such Person (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Security Trustee otherwise than in respect of an Event of Loss of the Engine, the Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Company or its order, (ii) except as specified in the following clause (iii), all proceeds less than or equal to the Threshold Amount (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of Stipulated Loss Value for the Engine suffering such loss shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to a Special Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss (other than in excess of the Stipulated Loss Value) shall be paid to the Senior Trustee (until the Lien of the Senior Mortgage shall have been discharged) and the Security Trustee for application in accordance with (from and after the Credit Agreement and time that the Lien of the Senior Mortgage shall have been discharged), (1213) if separate hull and war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 103, (or its equivalent)14) shall operate on a worldwide basis subject to certain territorial restrictions which are usual and customary in the War Risks market from time to time and (15) shall contain a provision entitling the Security Trustee to initiate a claim if an Event of Default shall be continuing.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Collateral Agent as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in if the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); , provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liabilityliability and agreed value, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor Company has agreed in the Loan Documents Operative Agreements to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Company (or, if a Special Default or an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeCollateral Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iii) below, in the event of (x) a loss in respect of an Engine (under circumstances in which an Event of Loss with respect to an Airframe has not occurred) or a Spare Engine involving proceeds in ANNEX B [C Mortgage and Security Agreement] excess of $2,500,000 or (y) any other loss involving proceeds in excess of $5,000,000, in each case, all proceeds in respect of such loss up to the amount of the Agreed Value shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Collateral Agent to be held by the Collateral Agent (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Collateral Agent otherwise than in respect of an Event of Loss of the Aircraft, the Collateral Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, to the extent not theretofore applied as provided in the C Mortgage, and any interest or income earned thereon, to the Company or its order, (ii) belowexcept as specified in the following clause (iii), all proceeds of (x) a loss in respect of an Engine (under circumstances in which an Event of Loss with respect to an Airframe has not occurred) or a Spare Engine of $2,500,000 or less or (y) any other loss of $5,000,000 or less, in each case, regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of the Agreed Value shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeCollateral Agent, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement Collateral Agent and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 AVS103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A 10(a) and B hereof 10(b) covering the Enginesany Aircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, : (1) shall (in the case of Section A, shall policies of airline liability and hull war liability coverage only) name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, ; (2) shall (in the case of aircraft hull and hull war and allied perils insurance coverages only) name the Security Trustee as loss payee to the extent provided in Section B.1, clause (12) below; (3) may provide for self-insurance to the extent permitted in Section 10(d); (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) 30 days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days (or such other period as shall be available) after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance market, obtainable; (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, Lessee; (56) shall (in the case of airline liability and hull war liability coverages only) be primary without any right of contribution from any other insurance which is carried by any Additional Insured, ; (67) shall (in the case of airline liability and hull war liability coverages only) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, ; (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, Insured but only to the extent of the indemnities provided under the Facility Agreement; (8) 9) shall provide that losses (other than for total loss of an Enginesuch Aircraft) shall be adjusted with the Grantor Lessee (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), ; (910) shall provide that the Additional Insureds are not liable for any insurance premiums, ; (1011) shall be effective with respect to both domestic and international operations, ; (1112) shall provide that for any loss not constituting an Event of Loss that: (i) except as specified in clause (iiiii) belowof this clause (12), in the event of a loss involving payments in excess of the Partial Loss Threshold, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is payable to the Lessee or any loss third party) shall be paid to the Grantor Security Trustee, it being understood and agreed that in the case of any payment to the Security Trustee otherwise than in respect of an Event of Loss of such Aircraft, the Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Lessee or its order and order; (ii) except as specified in clause (iii) of this clause (12), all proceeds involving payments of the Partial Loss Threshold or less and any payments of any loss in excess of Stipulated Insured Amount for such Aircraft shall be paid to the Lessee or its order; and (iii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if such payment is made on account of an Event of Loss of the Security Trustee is entitled to notify the insurer that such proceeds applicable Airframe or a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Trustee; and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 (or its equivalent)103.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 5.1, 5.2 and B 5.3 hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee Additional Insureds as loss payee additional insureds (but without imposing on any such party liability to pay premiums with respect to such insurance), (B) may provide for self-insurance to the extent provided permitted in Section B.15.5, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) 30 days (or ten (10) days in the case of lapse for nonpayment of premium) after sending to (but, premiums and seven days in the case of war war-risk and allied perils coverage, seven (7) days coverage after sending to) the Additional Insureds delivery of written notice by such insurers insurer to such Additional Insured of such lapse, cancellation or change change, (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that ifD) shall provide that, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies policies, the insurance shall not be invalidated or impaired by any action or inaction of the Grantor Company or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany or by any other Person (whether occurring before or after attachment of this Mortgage or whether occurring before or after any loss or payment under such insurance), (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7) insured and shall waive any right of subrogation of the insurers against the Additional Insureds Lenders and the Mortgagee, (G) shall, with respect to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall hull insurance, waive any right of the insurers to setoff set-off (except any standard set-off for unpaid premiums), recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) H) shall specifically refer to this Article V and shall acknowledge the general indemnity set forth in the Secured Credit Agreement, (I) in the case of hull insurance policies carried in accordance with Sections 5.2 and 5.3 hereof, shall name the Mortgagee as sole loss payee (for the benefit of the Secured Parties), (J) shall contain a 50/50% clause per AVS 103 or its equivalent, and (K) shall provide that losses in the event of a partial loss involving any Aircraft, Airframe, or Engine not constituting an Event of Loss, (other than i) for total which proceeds are in excess of $[***], all the proceeds in respect of such partial loss of an Engine) shall be adjusted with payable to the Grantor Mortgagee (orfor the benefit of the Secured Parties), if an it being understood and agreed that in the case of any such payment to the Mortgagee, the Mortgagee shall, upon receipt of evidence reasonably satisfactory to it and the Lenders that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment to the party having performed or performing the repairs to such Aircraft and (ii) for which proceeds are $[***] or less shall be paid, unless a Default or Event of Default shall have occurred which is and be continuing, with to the consent Company or its order for cost of repair of such Aircraft (it being agreed that the Security Trusteedollar amounts referred to in this clause (K) are inclusive of any applicable deductible and any self-insurance), (9L) shall provide that the Additional Insureds are insurers shall not liable for any insurance premiumsbe entitled to replace such Aircraft, (10) shall be effective with respect to both domestic and international operations, (11M) shall provide that for if a Default or Event of Default has occurred and is continuing, the Mortgagee shall be entitled to initiate claims under the policies, and (N) shall provide that in the event of a loss involving any loss not constituting Aircraft, Airframe or Airframe and Engine and the same constitutes an Event of Loss (i) except as specified in clause (ii) belowLoss, all the proceeds in respect of any loss such Event of Loss shall be paid payable to the Grantor Mortgagee (for the benefit of the Secured Parties), it being understood and agreed that, unless a Default or Event of Default shall have occurred and be continuing, the Mortgagee shall pay any amount in excess of all Secured Obligations relating to such Aircraft to the Company or its order order. [***] Represents material that has been omitted and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance filed separately with the Credit Agreement Securities and (12) if war risk coverage is maintained, shall contain Exchange Commission under a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Confidental Treatment Request.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 10(a) and B hereof 10(b) covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, : (1) shall (in the case of Section A, shall policies of airline liability and hull war liability coverage only) name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, ; (2) shall (in the case of aircraft hull and hull war and allied perils insurance coverages only) name the Security Trustee as loss payee to the extent provided in Section B.1, clause (12) below; (3) may provide for self-insurance to the extent permitted in Section 10(d); (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) 30 days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days (or such other period as shall be available) after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance market, obtainable; (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, Lessee; (56) shall (in the case of airline liability and hull war liability coverages only) be primary without any right of contribution from any other insurance which is carried by any Additional Insured, ; (67) shall (in the case of airline liability and hull war liability coverages only) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, ; (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, Insured but only to the extent of the indemnities provided under the Note Purchase Agreement; (8) 9) shall provide that losses (other than for total loss of an Enginethe Aircraft) shall be adjusted with the Grantor Lessee (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), ; (910) shall provide that the Additional Insureds are not liable for any insurance premiums, ; (1011) shall be effective with respect to both domestic and international operations, ; (1112) shall provide that for any loss not constituting an Event of Loss that: (i) except as specified in clause (iiiii) belowof this clause (12), in the event of a loss involving payments in excess of the Partial Loss Threshold, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is payable to the Lessee or any loss third party) shall be paid to the Grantor Security Trustee, it being understood and agreed that in the case of any payment to the Security Trustee otherwise than in respect of an Event of Loss of the Aircraft, the Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Lessee or its order and order; (ii) except as specified in clause (iii) of this clause (12), all proceeds involving payments of the Partial Loss Threshold or less and any payments of any loss in excess of Stipulated Insured Amount for the Aircraft shall be paid to the Lessee or its order; and (iii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if such payment is made on account of an Event of Loss of the Security Trustee is entitled to notify the insurer that such proceeds applicable Airframe or a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Trustee; and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 (or its equivalent)103.

Terms of Insurance Policies. Any policies carried in accordance --------------------------- with Sections A 11(a) and B hereof 11(b) covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, or, if appropriate, loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.111(d), (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee (or any Sublessee) and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorLessee (or any Sublessee), (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredInsured and shall waive insurers' subrogation rights, and (8) G) shall provide that losses (other than for total i) in the event of a loss occurring during the continuance of an Engine) shall be adjusted with the Grantor a Default or Event of Default or a loss involving proceeds in excess of [First Amended and Restated Lease Agreement (1989 I)] $5,000,000 (or, if the Aircraft is then under a Sublease, in excess of $2,500,000), the proceeds in respect of such loss up to the amount of Stipulated Loss Value shall be payable to Lessor (or, so long as the Trust Indenture shall not have been discharged, the Indenture Trustee, as Lessor's assignee) (except in the case of a loss with respect to an Engine installed on an airframe other than the Airframe, in which case Lessee (or any Sublessee) shall arrange for any payment of insurance proceeds (in the event of a loss involving proceeds in excess of such amounts) in respect of such loss to be held by Lessor (or, unless notified to the contrary by the Indenture Trustee, the Indenture Trustee) whether such payment is made to Lessee (or any Sublessee) or any third party), it being understood and agreed that in the case of any payment to Lessor (or the Indenture Trustee) otherwise than in respect of an Event of Loss, Lessor (or the Indenture Trustee) shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 22 hereof, to Lessee or its order, and (ii) the entire amount of any loss involving proceeds of $5,000,000 (or, if the Aircraft is then under a Sublease, of $2,500,000) or less or the amount of any proceeds of any loss in excess of Stipulated Loss Value for the Aircraft shall be paid to Lessee or its order unless a Default or an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by Lessor or the Security Indenture Trustee, all proceeds of loss ; provided that any such amount shall be paid applied by Lessee towards the repair of the damage caused by such loss to the Security Trustee for application in accordance with extent the Credit Agreement and (12) if war risk coverage same is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)required to repair such damage.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 11(a) and B hereof 11(b) covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, and, if appropriate, loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.111(d), (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) days in the case of nonpayment lapse for non-payment of premium) after sending to (but, premium and seven days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers insurer of such lapse, cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee (or any Sublessee) and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorLessee (or any Sublessee), (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, and (8) H) shall provide that losses (other than i) in the event of a loss involving the Aircraft Airframe, or an Engine for total loss which proceeds are in excess of an Engine) shall be adjusted with the Grantor $[_______] (or, if the Aircraft is then under a Sublease, in excess of $[_______]), the proceeds in respect of such loss up to the amount of Stipulated Loss Value for the Aircraft shall be payable to Lessor (or, so long as the Trust Indenture shall not have been discharged, the Mortgagee), it being understood and agreed that in the case of any payment to Lessor (or the Mortgagee) otherwise than in respect of an Event of Loss, Lessor (or the Mortgagee) shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 22 hereof, to Lessee or its order, and (ii) the entire amount of any such loss for which proceeds are $[_______] (or, if the Aircraft is then under a Sublease, are $[_______]) or less or the amount of any proceeds of any such loss in excess of Stipulated Loss Value for the Aircraft shall be paid to Lessee or its order unless an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by Lessor or the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Mortgagee.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 6.01 and B 6.02 hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in shall name the case of Lender as an Additional Insured (but without imposing on such party liability to pay premiums with respect to such insurance), and with respect to Section A6.02, shall name the Security Trustee and each other Secured Party (collectively, Lender as sole loss payee for any Event of Loss in respect of the “Additional Insureds”) as additional insureds, as their interests may appearAircraft, (2) shall name the Security Trustee as loss payee to the extent provided have deductibles in Section B.1amounts not exceeding $250,000, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any the Additional Insured, or such insurance shall lapse for non-payment of premium, such cancellation, lapse, or change shall not be effective as to the Additional Insureds Insured for thirty 30 days after receipt (30) seven days (or ten (10) days in the case of nonpayment of premium) after sending to (but, such notice in the case of war risk and allied perils coverage, seven (7) days after sending to) by the Additional Insureds Insured of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance marketchange, (4) shall provide that in respect of the Additional Insureds’ respective Insured's interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Borrower and shall insure the respective interests of the Additional Insureds Insured regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorBorrower, (5) shall be primary without any right of contribution from any other insurance which is carried by any the Borrower or the Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7) shall provide that the insurers waive (i) any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether -43- 43 by attachment or otherwise, in respect of any liability of the Borrower or the Additional Insured to the extent of any money owed to the Borrower or the Additional InsuredInsured and (ii) any right to subrogation, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor Borrower, unless and until the insurers have received written notice of an Event of Default which is continuing (orin which case adjustments shall be with the Lender), (9) shall contain a 50/50 clause per AVS 103 or its equivalent, and (10) shall provide that (i) in the event of a loss not constituting an Event of Loss with respect to the Aircraft and involving proceeds in excess of $250,000, the proceeds in respect of such loss shall be payable to the Lender to be held by the Lender whether such payment is made to the Borrower or any third party, it being understood and agreed that, except as provided in Section 6.07 hereof, in the case of any payment to the Lender other than in respect of an Event of Loss of the Aircraft, the Lender shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Borrower or its order, (ii) if insurance proceeds are $250,000 or less in respect of a loss not constituting an Event of Loss with respect to the Aircraft (regardless of the total amount of proceeds resulting from such loss) they shall be paid to the Borrower or its order unless an Event of Default shall have occurred which is continuingand be continuing and the insurers have been notified thereof by the Lender, with and (iii) in the consent event of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any a loss not constituting an Event of Loss with respect to the Aircraft, the proceeds in respect of such loss shall be payable to the Lender to be held by the Lender, even if, contrary to the terms hereof, such payment is made to the Borrower or any third party; provided, that (iand subject to Section 6.02) except the Lender shall immediately pay to Borrower any amount of such proceeds which exceeds 110% of the then outstanding principal of the Note and other amounts due under the Loan Agreement, this Security Agreement so long as specified in clause (ii) below, all proceeds no Event of Default shall be continuing. The Borrower shall give prompt written notice to the Lender of any loss shall be paid or damage to the Grantor Aircraft or its order and (ii) notwithstanding anything to any Engine for which the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds cost of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)repairs could exceed $50,000.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 10(a) and B hereof 10(b) covering the Enginesany Aircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, : (1) shall (in the case of Section A, shall policies of airline liability and hull war liability coverage only) name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, ; (2) shall (in the case of aircraft hull and hull war and allied perils insurance coverages only) name the Security Trustee as loss payee to the extent provided in Section B.1, clause (12) below; (3) may provide for self-insurance to the extent permitted in Section 10(d); (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) 30 days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days (or such other period as shall be available) after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance market, obtainable; (45) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Lessee and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, Lessee; (56) shall (in the case of airline liability and hull war liability coverages only) be primary without any right of contribution from any other insurance which is carried by any Additional Insured, ; (67) shall (in the case of airline liability and hull war liability coverages only) expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, ; (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, Insured but only to the extent of the indemnities provided under the Note Purchase Agreement; (8) 9) shall provide that losses (other than for total loss of an Enginesuch Aircraft) shall be adjusted with the Grantor Lessee (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), ; (910) shall provide that the Additional Insureds are not liable for any insurance premiums, ; (1011) shall be effective with respect to both domestic and international operations, ; (1112) shall provide that for any loss not constituting an Event of Loss that: (i) except as specified in clause (iiiii) belowof this clause (12), in the event of a loss involving payments in excess of the Partial Loss Threshold, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is payable to the Lessee or any loss third party) shall be paid to the Grantor Security Trustee, it being understood and agreed that in the case of any payment to the Security Trustee otherwise than in respect of an Event of Loss of such Aircraft, the Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Lessee or its order and order; (ii) except as specified in clause (iii) of this clause (12), all proceeds involving payments of the Partial Loss Threshold or less and any payments of any loss in excess of Stipulated Insured Amount for such Aircraft shall be paid to the Lessee or its order; and (iii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if such payment is made on account of an Event of Loss of the Security Trustee is entitled to notify the insurer that such proceeds applicable Airframe or a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Trustee; and (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 (or its equivalent)103.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 6.01 and B hereof 6.02 covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Administrative Agent (on behalf of the Lenders) as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section 6.04, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketobtainable, (45) shall provide that in respect of the Additional Insureds’ ' respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Borrower and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorBorrower, (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredInsured but only to the extent of the indemnities provided under the Credit Agreement, (8) 9) shall provide that losses (other than for total loss of an EngineAircraft) shall be adjusted with the Grantor Borrower (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeAdministrative Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) belowof this sub-section, in the event of a loss involving payments in excess of $*, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is made to the Borrower or any loss third party) shall be paid to the Grantor Administrative Agent on behalf of the Lenders, it being understood and agreed that in the case of any payment to the Administrative Agent otherwise than in respect of an Event of Loss of an Aircraft, the Administrative Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Borrower or its order, (ii) except as specified in clause (iii) of this sub-section, all proceeds of $* or less (regardless of the total amount of proceeds resulting from such loss) and any payments of any loss in excess of Stipulated Insured Amount for an Aircraft shall be paid to the Borrower or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeAdministrative Agent, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Administrative Agent, (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 103, and (14) if the policy (or its equivalent)policies) contains (or contain) an electronic date recognition exclusion such as AVN 2000, to include AVN 2001 and AVN 2002 or such other writebacks for hull and liability coverage as are customary for commercial airlines in the United States.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B 2.04(a) through 2.04(c) hereof covering the Enginesapplicable Collateral, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2i) shall name the Security Trustee Additional Insureds as additional insureds and, for purposes of Sections 2.04(b), 2.04(c)(i) and 2.04(i), the Collateral Agent as sole loss payee payee, as their respective interests may appear (but without imposing on any such party liability to pay premiums with respect to such insurance), (ii) may provide for self-insurance to the extent provided permitted in Section B.12.04(e) hereof, (3iii) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten twenty (1020) days in the case of nonpayment lapse for non-payment of premiumpremiums and seven (7) after sending to (but, days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4iv) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee) or by any other Person, (5v) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6vi) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insuredAdditional Insured, (7vii) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) viii) in the case of hull insurance policies carried in accordance with this Section 2.04, shall provide that losses (other than for total name the Collateral Agent as sole loss of an Engine) shall be adjusted payee in accordance with the Grantor provisions of clause (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trusteeix), (9ix) shall provide that in the Additional Insureds are not liable event of a loss involving an Aircraft, Airframe, Engine, Propeller or Spare Engine the proceeds in respect of such loss for any insurance premiumssuch Aircraft, Airframe, Engine, Propeller or Spare Engine shall be payable to the Collateral Agent and shall be applied in accordance with Section 2.6(c) of the Loan Agreement), (10x) shall be effective with respect waive any right of the insurers to both domestic subrogation against any Additional Insured, and international operations, (11xi) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause claims settlement per AVS 103 (or its equivalent).

Terms of Insurance Policies. Any policies carried in accordance with Sections A 4.03(a) and B 4.03(b) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, or, if appropriate (but subject to clause (H) below), loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.14.03(d) hereof, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Owner (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorOwner (or any Permitted Lessee) or by any other Person, (5E) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, and (8) H) shall provide that losses (other i) in the event of a loss involving the Aircraft, Airframe, or an Engine for which proceeds are in excess of the Loss Payee Amount, the proceeds in respect of such loss up to the amount of the Insured Amount for the Aircraft shall be payable to the Indenture Trustee, it being understood and agreed that in the case of any payment to the Indenture Trustee otherwise than for total loss in respect of an EngineEvent of Loss, the Indenture Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damages giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 9.04 hereof, to Owner or its order, and (ii) the entire amount of any such loss for which proceeds are equal to or less than the Loss Payee Amount or the amount of any proceeds of any such loss in excess of the Insured Amount for the Aircraft shall be adjusted with the Grantor (orpaid to Owner or its order unless a Section 8.01(a)(i), if an 8.01(e) or 8.01(f) Indenture Default or any Indenture Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all Indenture Trustee in which case such proceeds of loss shall be paid payable to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Indenture Trustee.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 12.1 and B 12.2 hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies: (a) Shall name Lessor, as applicable, (1) in Owner and the case of Section A, shall name the Security Trustee Lender and each other Secured Party of their respective officers, directors, employees and agents as additional insureds (collectively, the “"Additional Insureds”) as additional insureds"), as their interests may appearappear (but without imposing on such party liability to pay premiums with respect to such insurance) to the full extent and amount of aircraft liability insurance coverage held by Lessee, and shall name Owner and the Lender as sole, joint, loss payees (2"Sole Loss Payee") with respect to proceeds payable for an Event of Loss and in accordance with Section 12.2 above with respect to damage not constituting an Event of Loss; (b) shall name the Security Trustee as loss payee to the extent provided have deductibles in Section B.1, amounts not exceeding $50,000; (3c) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any the Additional InsuredInsureds or Sole Loss Payee, or such insurance shall lapse for non-payment of premium, such cancellation, lapse, or change shall not be effective as to the Additional Insureds or Sole Loss Payee for thirty 30 days after receipt (30) seven days (or ten (10) days in the case of nonpayment of premium) after sending to (but, such notice in the case of war risk and allied perils coverage, seven (7) days after sending to) by the Additional Insureds or Sole Loss Payee of written notice by such insurers of such 13 cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance market, reasonably obtainable; (4d) shall provide that in respect of the Additional Insureds’ respective ' or Sole Loss Payee's interests in such policies the insurance shall not be invalidated by any action action, inaction or inaction omission of the Grantor Lessor or Lessee and shall insure the respective interests of the Additional Insureds or Sole Loss Payee regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, Lessee; (5e) shall be primary without any right of contribution from any other insurance which is carried by any Lessee, or the Additional Insured, Insureds or Sole Loss Payee; (6f) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured; (g) shall provide that the insurers waive any right, (7i) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of Lessee or any Additional InsuredInsured to the extent of any money owed to Lessee or the Additional Insureds and, (8) ii) any right to subrogation; (h) shall provide that losses (other than for total loss of an Engine) shall be adjusted with Lessee and Lessor jointly, unless and until the Grantor (or, if insurers have received written notice of an Event of Default shall have occurred which is continuing, continuing (in which case adjustments shall be with Lessor solely) or until insurers have paid to Lessor and the consent of Lender the Security TrusteeStipulated Loss Value (in which case adjustments shall be made with Lessee solely), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss ; (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause per AVS 103 (or its equivalent); and, (j) shall include and insure (to the extent of the risks covered by the policies) the indemnity provisions of Section 13 and Lessee will maintain such insurance of the indemnities for a minimum of three (3) years following the Expiration Date of the Lease.

Terms of Insurance Policies. Any insurance policies carried in i accordance with Sections A and B Section 22.1(a) hereof covering the EnginesEquipment, and any policies taken out in substitution or replacement for any such policies, policie as applicable, (1i) shall name the Indenture Trustee as sole loss payee in the case of property insurance, (ii) shall name the Lessor Parties a additional insureds (the AAdditional Insureds@) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appearliabilit insurance, (2iii) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.122.1(c) hereof, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance market, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, (5iv) shall be primary without any right of contribution from any other insurance which is carried by any or may be available to protect the Additional InsuredInsureds, (6v) shall expressly provide provi that with respect to liability policies all of the provisions thereof, except the limits of liabilityinsurer=s total liability set forth in each such policy, shall operate in the same manner as if a separate policy covered cover each insured, (7vi) shall waive any right of subrogation provide that in respect of the insurers against Additional Insureds= interest in such policies the insurance shall not be invalidated by any action or inaction of the Lessee Parties and shall insure the respective interests of the Additional Insureds to regardless any breach or violation by the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff or counterclaim or any other deduction, whether by attachment or otherwise, in respect Lessee Parties of any liability of any Additional Insuredwarranty, declaration or condition contained in such policy, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9vii) shall provide that the Additional Insureds are not liable for any insurance premiums, premiums (10) shall be effective with respect to both domestic and international operations, (11viii) shall provide that if the insurers cancel such insurance for an reason whatsoever, or if any loss not constituting an Event of Loss (i) except as specified material change is made in clause (ii) below, all proceeds such insurance which adversely affects the interests of any loss Additional Insured (or the successors and assigns), or if such insurance lapses, such cancellatio change or lapse shall not be paid effective as to the Grantor Additional Insureds ( their successors and assigns) for thirty (30) days after receipt by th Additional Insureds (or its order their successor and assigns) of written notice by such insurers of such cancellation, change or lapse, (ix) shall require the insurers to waive any rights of subrogation, set-off or counterclaim against any Additional Insured, and (iix) notwithstanding anything shall otherwise contain terms and conditions, including without limitation, the paymen of deductible in connection with any such insurance, that are reasonab satisfactory to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Lessor Parties.

Terms of Insurance Policies. Any policies carried in accordance --------------------------- with Sections A 4.03(a) and B 4.03(b) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, or, if appropriate (but subject to clause (H) below), loss payees, as their respective interests may appearappear (but without imposing on any such party liability to pay premiums with respect to such insurance), (2B) shall name the Security Trustee as loss payee may provide for self-insurance to the extent provided permitted in Section B.14.03(d) hereof, (3C) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non- payment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4D) shall provide that in respect of the Additional Insureds’ respective interests of each Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Owner (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorOwner (or any Permitted Lessee) or by any other Person, (5E) shall be primary without any right of contribution from any other insurance which is carried [Trust Indenture and Mortgage (2001-1 747-1)] by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, and (8) H) shall provide that losses (other i) in the event of a loss involving the Aircraft, Airframe, or an Engine for which proceeds are in excess of the Loss Payee Amount, the proceeds in respect of such loss up to the amount of the Insured Amount for the Aircraft shall be payable to the Indenture Trustee, it being understood and agreed that in the case of any payment to the Indenture Trustee otherwise than for total loss in respect of an EngineEvent of Loss, the Indenture Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damages giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 9.04 hereof, to Owner or its order, and (ii) the entire amount of any such loss for which proceeds are equal to or less than the Loss Payee Amount or the amount of any proceeds of any such loss in excess of the Insured Amount for the Aircraft shall be adjusted with the Grantor (orpaid to Owner or its order unless a Section 8.01(a)(i), if an 8.01(e) or 8.01(f) Indenture Default or any Indenture Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all Indenture Trustee in which case such proceeds of loss shall be paid payable to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)Indenture Trustee.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B the terms hereof covering the Aircraft, Engines and Spare Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) as additional insureds, as their interests may appear, (2) shall name the Security Trustee Additional Insureds as additional insureds and (i) prior to the indefeasible payment in full of all Tranche C Obligations, with respect to the Tranche A and B Priority Collateral and (ii) thereafter, with respect to all Collateral, name the Collateral Agent as loss payee payee, as their respective interests may appear (but without imposing on any such party liability to the extent provided in Section B.1pay premiums with respect to such insurance), (3B) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which adversely affects the interest of any additional insured named in accordance with clause (A) (a "Named Additional Insured"), such cancellation, lapse, cancellation or change shall not be effective as to the any Named Additional Insureds Insured for thirty (30) days (or ten (10) twenty days in the case of nonpayment lapse for non-payment of premium) after sending to (but, premiums and seven days in the case of war risk and allied perils coverage, seven (7) days after sending to) the receipt by such Named Additional Insureds Insured of written notice by such insurers of such lapse, cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register)change; provided, however, that if, in respect of the war risk and allied perils coverageif any notice period specified above is not reasonably obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketreasonably obtainable, (4C) shall provide that in respect of the Additional Insureds’ respective interests of each Named Additional Insured in such policies the insurance shall not be invalidated by any action or inaction of the Grantor (or any Permitted Lessee) or any other Person and shall insure the respective interests of the Named Additional Insureds Insureds, as they appear, regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorGrantor (or any Permitted Lessee) or by any other Person, (5D) shall be primary without any right of contribution from any other insurance which is carried by any Named Additional Insured, (6E) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7F) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive any right of the insurers to setoff set-off, recoupment or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Named Additional Insured, (8) G) shall specifically refer to this Section 2.03, (H) in the case of hull insurance policies carried in accordance with this Section 2.03, shall name the Collateral Agent as loss payee, (I) shall waive any right of the insurers to subrogation against any Named Additional Insured and (J) shall provide that losses for a 50/50 claims settlement per AVS 103 or its equivalent. Subject as provided in Section 2.03(h), nothing herein is intended to limit or restrict Grantor's (other than for total loss or any Permitted Lessee's) right to self-insure, to the extent of an Engine) shall be adjusted with the Grantor any applicable minimum per aircraft or engine (or, if an Event of Default shall have occurred applicable, per annum or other period), the hull or liability insurance deductible imposed by the applicable hull or liability insurer, which is continuing, are commensurate with the consent standard deductibles in the aircraft industry for major U.S. commercial airlines.". 9. Amendment to Section 2.05(d). Section 2.05(d) of the Security Trustee)Mortgage is hereby amended by inserting the words "(subject, (9) shall provide that only in the Additional Insureds are not liable for any insurance premiumscase of the Tranche C Collateral, (10) shall be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to prior rights of the contrary contained in Tranche C Collateral Agent on behalf of the preceding clause (iTranche C Lenders), if " immediately after the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and (12) if war risk coverage is maintained, shall contain words "will constitute a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 (or its equivalent)perfected security interest therein prior" appearing therein.

Terms of Insurance Policies. Any policies Each policy carried in accordance with Sections A 4.01(e)(i) and B (e)(ii) hereof covering the EnginesAircraft, and any policies taken out in substitution or replacement for any such policies, as applicable, (1A) shall in the case of liability insurance carried pursuant to Section A4.01(e)(i), shall including all war risk insurance as required by such section, name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, and in the case of insurance carried pursuant to Sections 4.01(e)(i) and (e)(ii), name the Loss Payee as their interests may appearfirst loss payee (but without imposing on any such party liability to pay premiums, calls or other charges with respect to such insurance), (2) shall name the Security Trustee as loss payee to the extent provided in Section B.1, (3B) shall provide that if the insurers cancel such insurance for any reason whatsoeverwhatever, or if the same is allowed to lapse for nonpayment non-payment of premium or if any material change is made in the insurance which that adversely affects the interest of any Additional InsuredInsured under this Agreement, such cancellation, lapse, cancellation or change shall not be effective as to the any Additional Insureds Insured for thirty (30) 30 days (or ten (10) seven days in the case of nonpayment of premium) after sending to (but, in the case of war risk and allied perils coverage, seven (7) days after sending to) receipt by the Additional Insureds Insurance Broker of written notice by such insurers of such lapse, cancellation or change change, (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies C) shall provide that the Additional Insureds shall have no liability for premiums, commissions, calls, assessments, warranties or representations to underwriters, or advances with respect to such shorter period as may be available in the international insurance marketpolicies, (4D) shall provide that such insurance is primary without right of contribution, (E) shall provide that in respect of the respective interest of each Additional Insureds’ respective interests Insured under this Agreement in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Borrower or any other Person and shall insure the respective interests of the Additional Insureds Insureds, as they appear under this Agreement, regardless of any breach or violation of any representation, warranty, declaration or condition contained in such policies by Borrower or, in the Grantorcase of an Additional Insured, (5) shall be primary without any right of contribution from the breach or violation by any other insurance which is carried by any Additional Insured, (6F) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covered covering each insured, (7G) shall provide that the Additional Insured shall have no responsibility for premium and the insurers shall waive any right of subrogation of the insurers set-off or counterclaim against the Additional Insureds to except in respect of outstanding premium in respect of the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds Aircraft and shall waive any right rights of subrogation against the insurers to setoff Additional Insureds, (H) shall provide that (1) in the event of a loss involving the Aircraft, Airframe, or counterclaim or any other deductionan Engine for which proceeds are in excess of $2,500,000, whether by attachment or otherwise, the proceeds in respect of such loss up to the amount of the then outstanding principal amount of the Notes plus all other amounts due to the Note Holders under the Operative Documents, together with accrued interest thereon shall be payable, to Security Trustee as loss payee; provided, that the application of such insurance proceeds shall be as provided in Section 4.01(e)(iii), with any liability amounts paid and held by Security Trustee for any period being subject to Section 3.07 hereof; provided, further, that in the case of any Additional Insured, (8) shall provide that losses (other payment to Security Trustee otherwise than for total loss in respect of an Event of Loss, Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment has been repaired, pay the amount of such payment, and any interest or income earned thereon in accordance with Section 3.07 hereof, to Borrower or its order (provided, that Borrower may elect by written notice to Security Trustee to apply such insurance proceeds directly to the repair of the relevant Airframe or Engine, as the case may be), and (2) the entire amount of any such loss for which proceeds are $2,500,000 or less or the amount of any proceeds of any such loss in excess of the then outstanding principal amount of the Notes, together with accrued interest thereon plus all other amounts due to the Note Holders under the Operative Documents shall be adjusted with the Grantor (or, if paid to Borrower or its order unless a Specified Default or an Event of Default shall have occurred which is continuing, with the consent of the Security Trustee), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall and be effective with respect to both domestic and international operations, (11) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss shall be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds (I) shall specifically exclude coverage for any Additional Insured or Loss Payee with respect to any claim arising out of loss the legal liability of such Person as manufacturer, repairer, supplier or servicing agent of the Aircraft and shall not operate to prejudice the rights of recourse of the underwriters of such insurance against any such Additional Insured or Loss Payee where such rights of recourse would have existed had such exclusion not been effected under such policies, (J) shall be paid to the Security Trustee for application payable in accordance with the Credit Agreement Dollars, and (12K) if in the event the hull “all risks” and hull war risk coverage is maintainedrisks policies are placed separately, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 AVS103 (or its equivalent) (being the current London market endorsement for such). Notwithstanding the foregoing, in the event the insurance acquired by Borrower is subject to the AVN 67B endorsement, to the extent the terms of such endorsement conflict with the foregoing, the terms of AVN 67B shall apply.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the EnginesSection 3.5(a) or Section 3.5(b), and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Secured Party as loss payee to the extent provided in Section B.1clause (11) below, (3) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) 30 days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageInsurance, seven 7 days (7or such other period as shall be available) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (or, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall provide for such shorter period as may be available in the international insurance marketchange, (4) shall provide that in respect of the Additional Insureds’ respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the Grantor, (5) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (6) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredInsured but only to the extent of the indemnities provided hereunder, (8) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor (or, if an any Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeSecured Party), (9) shall provide that the Additional Insureds are not liable for any insurance premiums, (10) shall be effective with provide that the insurers agree to waive any right of set-off, counterclaim or other deduction against any Additional Insured (except in respect to both domestic and international operationsof outstanding premium in respect of the relevant Airframe, Engine or Propeller), (11) shall provide that for any loss not constituting if an Event of Loss (i) except as specified in clause (ii) below, all proceeds of any loss Default shall have occurred and be paid to the Grantor or its order and (ii) notwithstanding anything to the contrary contained in the preceding clause (i), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeSecured Party, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement Secured Party, and (12) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 (or its equivalent)103.

Terms of Insurance Policies. Any policies carried in accordance with Sections A 6.01 and B hereof 6.02 covering the EnginesAircraft, --------------------------- and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “Additional Insureds”) Insureds as additional insureds, as their interests may appear, (2) shall name the Security Trustee Administrative Agent (on behalf of the Lender) as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section 6.04, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, cancellation or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending to receipt by (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that -------- ------- if, in respect of the war risk and allied perils coverageWar Risk Insurance, any notice period specified above is not obtainable, such policies shall provide for such shorter as long a period of prior notice as may shall then be available in the international insurance marketobtainable, (45) shall provide that in respect of the Additional Insureds’ ' respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Borrower and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorBorrower, (56) shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional InsuredInsured but only to the extent of the indemnities provided under the Credit Agreement, (8) 9) shall provide that losses (other than for total loss of an EngineAircraft) shall be adjusted with the Grantor Borrower (or, if an Event of Default shall have occurred which is continuing, with the consent of the Security TrusteeAdministrative Agent), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) belowof this sub-section, in the event of a loss involving payments in excess of $750,000, all proceeds payments in respect of such loss up to the amount of Stipulated Insured Amount (whether such payment is made to the Borrower or any loss third party) shall be paid to the Grantor Administrative Agent on behalf of the Lender, it being understood and agreed that in the case of any payment to the Administrative Agent otherwise than in respect of an Event of Loss of an Aircraft, the Administrative Agent shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Borrower or its order, (ii) except as specified in clause (iii) of this sub-section, all proceeds of $750,000 or less (regardless of the total amount of proceeds resulting from such loss) and any payments of any loss in excess of Stipulated Insured Amount for an Aircraft shall be paid to the Borrower or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds a Special Default or an Event of loss are to Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security TrusteeAdministrative Agent, all proceeds payments of loss shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Administrative Agent, (1213) if war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause as per AVS 103 103, and (14) if the policy (or its equivalent)policies) contains (or contain) an electronic date recognition exclusion such as AVN 2000, to include AVN 2001 and AVN 2002 or such other writebacks for hull and liability coverage as are customary for commercial airlines in the United States.

Terms of Insurance Policies. Any policies carried in accordance with Sections A and B hereof covering the Aircraft and the Engines, and any policies taken out in substitution or replacement for any such policies, as applicable, (1) in the case of Section A, shall name the Security Trustee and each other Secured Party (collectively, the “"Additional Insureds”") as additional insureds, as their interests may appear, (2) in the case of hull insurance, shall name the Security Trustee as sole loss payee to the extent provided in Section B.1clause (12) below, (3) may provide for self-insurance to the extent permitted in Section D, (4) shall provide that if the insurers cancel such insurance for any reason whatsoever, or the same is allowed to lapse for nonpayment of premium or if any material change is made in the insurance which adversely affects the interest of any Additional Insured, such cancellation, lapse, or change shall not be effective as to the Additional Insureds for thirty (30) days (or ten (10) days in the case of nonpayment of premium) after sending issuance to (but, in the case of war risk and allied perils coverageWar Risk Insurance, seven (7) days after sending to) the Additional Insureds of written notice by such insurers of such cancellation or change (orchange, in the case of war risk and allied perils insurance underwritten by the FAA, seven days after publication in the Federal Register); provided, however, that if, in respect of the war risk and allied perils coverage, such policies shall Company's War-Risk Insurance provider does not provide for such shorter period as may be available provision of direct notice to Additional Insureds of cancellation, change or lapse in the international insurance marketrequired hereunder, the Company hereby agrees that, upon receipt of notice (including any notice by publication, if applicable) of any cancellation, change or lapse thereof from such insurance provider it shall give the Additional Insureds immediate notice of each cancellation or lapse and prompt notice of each change of such insurance, (45) shall provide that in respect of the Additional Insureds’ ' respective interests in such policies the insurance shall not be invalidated by any action or inaction of the Grantor Company (or any Permitted Lessee) and shall insure the respective interests of the Additional Insureds regardless of any breach or violation of any warranty, declaration or condition contained in such policies by the GrantorCompany (or any Permitted Lessee), (56) in the case of liability insurances, shall be primary without any right of contribution from any other insurance which is carried by any Additional Insured, (67) in the case of liability insurances, shall expressly provide that all of the provisions thereof, except the limits of liability, shall operate in the same manner as if a separate policy covered each insured, (7) 8) shall waive any right of subrogation of the insurers against the Additional Insureds to the same extent Grantor has agreed in the Loan Documents to indemnify the Additional Insureds and shall waive or any right of the insurers to setoff set-off or counterclaim or any other deduction, whether by attachment or otherwise, in respect of any liability of any Additional Insured, (8) 9) shall provide that losses (other than for total loss of an Engine) shall be adjusted with the Grantor Company (or, if an Event of Default or Special Default shall have occurred which is continuing, with the consent of the Security Trustee), (910) shall provide that the Additional Insureds are not liable for any insurance premiums, (1011) shall be effective with respect to both domestic and international operations, (1112) shall provide that for any loss not constituting an Event of Loss (i) except as specified in clause (iiiii) below, in the event of a loss involving proceeds in excess of the Threshold Amount, all proceeds in respect of such loss up to the amount of Stipulated Loss Value for an affected Engine shall, to the extent such proceeds are not paid by the insurer(s) directly to the person effecting the repair, be payable to the Security Trustee to be held by the Security Trustee (whether such payment is made to the Company (or any Permitted Lessee) or any third party), it being understood and agreed that in the case of any payment to the Security Trustee otherwise than in respect of an Event of Loss of the Engine, the Security Trustee shall, upon receipt of evidence reasonably satisfactory to it that the damage giving rise to such payment shall have been repaired or that such payment shall then be required to pay for repairs then being made or the replacement of the Engine suffering the Event of Loss, pay the amount of such payment, and any interest or income earned thereon, to the Company or its order, (ii) except as specified in the following clause (iii), all proceeds equal to or less than the Threshold Amount (regardless of the total amount of proceeds resulting from such loss) and any proceeds of any loss in excess of Stipulated Loss Value for the Engine suffering such loss shall be paid to the Grantor Company or its order and (iiiii) notwithstanding anything to the contrary contained in the preceding clause clauses (i) and (ii), if the Security Trustee is entitled to notify the insurer that such proceeds of loss are to a Special Default shall have occurred and be paid to the Security Trustee pursuant to Section B.1, continuing and the insurers have been so notified thereof by the Security Trustee, all proceeds of loss (other than in excess of the Stipulated Loss Value) shall be paid to the Security Trustee for application in accordance with the Credit Agreement and Trustee, (1213) if separate hull and war risk coverage is maintained, shall contain a 50/50 clause in accordance with Provisional Claims Settlement Clause AVS 103 103, (or its equivalent)14) shall operate on a worldwide basis subject to certain territorial restrictions which are usual and customary in the War Risks market from time to time and (15) shall contain a provision entitling the Security Trustee to initiate a claim if an Event of Default shall be continuing.