EXECUTION COPY
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
by and among
AIRCASTLE INVESTMENT HOLDINGS LIMITED,
AIRCASTLE IRELAND NO. 1 LIMITED,
ABH 12 LIMITED
and
THE BORROWERS PARTY HERETO FROM TIME TO TIME,
as Borrowers,
JPMORGAN CHASE BANK, N.A. and
BEAR XXXXXXX CORPORATE LENDING INC.,
as Lenders
and
JPMORGAN CHASE BANK, N.A.,
as Agent
and
THE OTHER LENDERS PARTY HERETO FROM TIME TO TIME
Dated as of October 24, 2005
TABLE OF CONTENTS
PAGE
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ARTICLE I
Definitions and Terms
1.1. Definitions....................................................... 1
1.2. Rules of Interpretation........................................... 23
ARTICLE II
The Revolving Credit Facility
2.1. Revolving Loans................................................... 25
2.2. Payment of Interest............................................... 27
2.3. Payment of Principal.............................................. 27
2.4. Manner of Payment................................................. 28
2.5. Notes............................................................. 29
2.6. Pro Rata Payments................................................. 29
2.7. Reductions........................................................ 29
2.8. Conversions and Elections of Subsequent Interest Periods.......... 30
2.9. Increase and Decrease in Amounts.................................. 30
2.10. Fees.............................................................. 30
2.11. Deficiency Advances............................................... 30
2.12. Use of Proceeds................................................... 31
2.13. Designation of Borrowing Affiliate; Releases...................... 31
2.14. Joint and Several Liability....................................... 32
2.15. Eligible Lease Involving Eligible Intermediary.................... 33
ARTICLE III
Security
3.1. Security.......................................................... 34
3.2. Further Assurances................................................ 34
3.3. Information Regarding Collateral.................................. 34
3.4. Quiet Enjoyment................................................... 35
ARTICLE IV
Change in Circumstances
4.1. Requirements of Law............................................... 35
4.2. Limitation on Types of Loans...................................... 36
4.3. Illegality........................................................ 36
4.4. Treatment of Affected Loans....................................... 37
4.5. Compensation...................................................... 37
4.6. Taxes............................................................. 38
ARTICLE V
Conditions to Making Loans
5.1. Conditions of Closing............................................. 40
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5.2. Conditions of Closing of Second Amended and Restated Credit
Agreement...................................................... 42
5.3. Conditions of Revolving Loans..................................... 44
5.4. Conditions of Subsequent Advances Under Revolving Loans........... 47
ARTICLE VI
Representations and Warranties
6.1. Organization and Authority........................................ 48
6.2. Loan Documents.................................................... 48
6.3. Solvency.......................................................... 49
6.4. Subsidiaries and Stockholders..................................... 49
6.5. Ownership Interests............................................... 49
6.6. Liens............................................................. 49
6.7. Title to Properties............................................... 49
6.8. Taxes............................................................. 49
6.9. Other Agreements.................................................. 50
6.10. Litigation........................................................ 50
6.11. Federal Regulations............................................... 50
6.12. Investment Company................................................ 50
6.13. Patents, Etc...................................................... 51
6.14. No Untrue Statement............................................... 51
6.15. No Consents, Etc.................................................. 51
6.16. Employee Benefit Plans............................................ 51
6.17. No Default........................................................ 52
6.18. Environmental Laws................................................ 52
6.19. Employment Matters................................................ 52
ARTICLE VII
Affirmative Covenants
7.1. Financial Reports, Etc............................................ 52
7.2. Maintain Properties............................................... 54
7.3. Existence, Qualification, Etc..................................... 54
7.4. Regulations and Taxes............................................. 54
7.5. Insurance......................................................... 54
7.6. True Books........................................................ 54
7.7. Right of Inspection............................................... 54
7.8. Observe all Laws.................................................. 54
7.9. Governmental Licenses............................................. 55
7.10. Covenants Extending to Other Persons.............................. 55
7.11. Officer's Knowledge of Default.................................... 55
7.12. Suits or Other Proceedings........................................ 55
7.13. Notice of Environmental Complaint or Condition.................... 55
7.14. Environmental Compliance.......................................... 55
7.15. Indemnification................................................... 56
7.16. Further Assurances................................................ 56
7.17. Swap Agreements................................................... 56
7.18. Continued Operations.............................................. 56
7.19. Maintenance of Aircraft; Other Covenants and Restrictions; Non-
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Discrimination................................................. 56
7.20. Re-registration of Aircraft....................................... 57
7.21. Servicer.......................................................... 57
7.22. Employee Benefit Plans............................................ 57
7.23. Accounts.......................................................... 57
7.24. Eligible Lease; Lessee Notice..................................... 57
7.25. Conditions Subsequent to Closing.................................. 57
ARTICLE VIII
Negative Covenants
8.1. Acquisitions...................................................... 58
8.2. Capital Expenditures.............................................. 58
8.3. Liens............................................................. 58
8.4. Indebtedness...................................................... 59
8.5. Transfer of Assets................................................ 60
8.6. Subsidiaries; Investments......................................... 60
8.7. Merger or Consolidation........................................... 61
8.8. Transactions with Affiliates...................................... 61
8.9. Employee Benefit Plans; ERISA Affiliates; Employees............... 61
8.10. Fiscal Year....................................................... 61
8.11. Dissolution, etc.................................................. 61
8.12. Change in Control................................................. 61
8.13. Negative Pledge Clauses........................................... 61
8.14. Partnerships...................................................... 62
8.15. Business and Operations........................................... 62
8.16. Ownership, Operation and Leasing of Financed Aircraft............. 62
8.17. Servicing Agreements.............................................. 62
8.18. Representations Regarding Agent and Lenders....................... 62
8.19. Holdings; Irish Holdings.......................................... 63
8.20. Organizational Documents.......................................... 63
ARTICLE IX
Events of Default and Acceleration
9.1. Events of Default................................................. 63
9.2. Agent to Act...................................................... 66
9.3. Cumulative Rights................................................. 66
9.4. No Waiver......................................................... 66
9.5. Allocation of Proceeds............................................ 67
9.6. Activities of Eligible Carriers................................... 67
ARTICLE X
The Agent
10.1. Appointment, Powers, and Immunities............................... 68
10.2. Reliance by Agent................................................. 68
10.3. Defaults.......................................................... 69
10.4. Rights as Lender.................................................. 69
10.5. Indemnification................................................... 69
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10.6. Non-Reliance on Agent and Other Lenders........................... 70
10.7. Resignation of Agent.............................................. 70
10.8. Fees.............................................................. 70
ARTICLE XI
Miscellaneous
11.1. Assignments and Participations.................................... 70
11.2. Notices........................................................... 72
11.3. Right of Set-off; Adjustments..................................... 74
11.4. Survival.......................................................... 74
11.5. Expenses.......................................................... 75
11.6. Amendments and Waivers............................................ 75
11.7. Counterparts...................................................... 75
11.8. Return of Funds................................................... 75
11.9. Indemnification; Limitation of Liability.......................... 76
11.10. Severability...................................................... 77
11.11. Entire Agreement.................................................. 77
11.12. Payments.......................................................... 77
11.13. Confidentiality................................................... 77
11.14. Governing Law; Waiver of Jury Trial............................... 78
11.15. USA PATRIOT Act................................................... 79
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EXHIBITS
EXHIBIT A Applicable Commitment Percentages
EXHIBIT B Form of Assignment and Acceptance
EXHIBIT C Notice of Appointment (or Revocation) of Authorized
Representative
EXHIBIT D Form of Borrowing Notice
EXHIBIT E Form of Interest Rate Selection Notice
EXHIBIT F Form of Note
EXHIBIT G-1 Form of Domestic Counsel Opinion
EXHIBIT G-2 Form of FAA Counsel Opinion at Funding
EXHIBIT G-3 Form of Foreign Counsel Opinion as to Borrower
EXHIBIT G-4 Form of Foreign Counsel Opinion as to Lease and Lessee
EXHIBIT H Compliance Certificate
EXHIBIT I Form of Facility Guaranty
EXHIBIT J Form of Security Agreement
EXHIBIT K List of Approved Aircraft Models
EXHIBIT L Required Insurance on Each Aircraft
EXHIBIT M Form of Lessee Notice
EXHIBIT N Form of Parent Support Agreement
EXHIBIT O Form of Lockbox Agreement
EXHIBIT P Form of Servicing Agreement
EXHIBIT Q Form of Assumption Letter
EXHIBIT R Borrowing Base Certificate
EXHIBIT S-1 Form of Pledge and Security Agreement (for pledged beneficial
interest in Holdings Subsidiary Trust)
EXHIBIT S-2 Form of Pledge and Security Agreement (for pledged interest
in Holdings SPC, Beneficial Owner, Applicable Intermediary
or other Subsidiary)
EXHIBIT S-3 Form of Bermuda Pledge
EXHIBIT T Form of Contribution Agreement
EXHIBIT U Form of Contribution Agreement Guaranty
SCHEDULES
Schedule 3.3 Information Regarding Collateral
Schedule 6.7 Existing Liens
Schedule 6.8 Tax Matters
Schedule 6.10 Litigation
Schedule 7.19(a) Maintenance, Return, Alteration, Replacement, Pooling and
Lease
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THIRD AMENDED AND RESTATED CREDIT AGREEMENT
THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October
24, 2005 (as may be amended, supplemented or otherwise modified from time to
time, the "Agreement"), is made by and among Aircastle Investment Holdings
Limited ("Holdings"), an exempted company organized and existing under the laws
of Bermuda, AIRCASTLE IRELAND NO. 1 LIMITED, a limited liability company
incorporated in Ireland and an indirect subsidiary of the Parent ("Irish
Holdings"), and certain Holdings Subsidiary Trusts and Holdings SPCs (as defined
below) designated as Borrowing Affiliates hereunder (such Holdings Subsidiary
Trusts and Holdings SPCs being referred to individually as a "Borrower" or
collectively as the "Borrowers"), ABH 12 Limited, an exempted company organized
and existing under the laws of Bermuda, as a Guarantors (as defined below) and
not a Borrower, JPMORGAN CHASE BANK, N.A., a national banking association, in
its capacity as a Lender ("JPMCB"), BEAR XXXXXXX CORPORATE LENDING INC., a
national banking corporation and each other financial institution executing and
delivering a signature page hereto and each other financial institution which
may hereafter execute and deliver an instrument of assignment with respect to
this Agreement pursuant to Section 11.1 (such financial institutions hereinafter
being referred to individually as a "Lender" or collectively as the "Lenders"),
and JPMORGAN CHASE BANK, N.A., in its capacity as agent for the Lenders (in such
capacity, and together with any successor agent appointed in accordance with the
terms of Section 10.7, the "Agent");
WITNESSETH:
WHEREAS, the Borrowers, the Lenders and the Agent are parties to the
Credit Agreement dated as of February 25, 2005 which was amended and restated
pursuant to the Amended and Restated Credit Agreement dated as of March 4, 2005
as further amended by the Second Amended and Restated Credit Agreement dated as
of August 3, 2005 (the "Amended and Restated Credit Agreement");
WHEREAS, the Borrowers have requested that certain amendments to be
made to the Amended and Restated Credit Agreement and to permit certain Irish
entities to become borrowers and guarantors hereunder; and
WHEREAS, the Lenders are willing to make such amendments to the
Amended and Restated Credit Agreement upon the terms and conditions set forth
herein;
NOW, THEREFORE, the Borrowers, the Lenders and the Agent hereby agree
as follows:
ARTICLE I
DEFINITIONS AND TERMS
1.1. Definitions. For the purposes of this Agreement, in addition to
the definitions set forth above, the following terms shall have the respective
meanings set forth below:
"ABH 12" means ABH 12 Limited, a wholly-owned subsidiary of Holdings.
"ABH 12 Security Agreement" means the Security Agreement dated as of
August 3, 2005, as amended and restated as of the date hereof, made by ABH
12 in favor of the Agent.
"ABH 12-JPM Swap Agreement" means the Confirmation and the ISDA Master
Agreement (including all related schedules and credit support annexes),
each dated as of March 2, 2005, between Holdings and JPMorgan Chase Bank,
N.A., as novated pursuant to the Novation Agreement, dated as of August 3,
2005, among JPMorgan Chase Bank, N.A., Holdings, as transferor, and ABH 12,
as transferee, together with the ISDA Master Agreement (including all
related schedules and credit support annexes) dated as of August 3, 2005,
as may be further novated, amended, supplemented or otherwise modified from
time to time.
"Account" has the meaning given in the Lockbox Agreement.
"Acquisition" means the acquisition of any beneficial interest, equity
interest or other ownership interest in another Person (including the
purchase of an option, warrant or convertible or similar type security to
acquire such interest at the time it becomes exercisable by the holder
thereof), whether by purchase of such interest or upon exercise of an
option or warrant for, or conversion of securities into, such interest.
"Additional Facility Documents" has the meaning given such term in
Section 5.1(a)(i).
"Additional Credit Party" means Irish Holdings and each of its
Subsidiaries.
"Affiliate" means any Person (i) which directly or indirectly through
one or more intermediaries controls, or is controlled by, or is under
common control with any Guarantor or any Borrower; or (ii) which
beneficially owns or holds 10% or more of any class of the outstanding
voting stock (or in the case of a Person which is not a corporation, 10% or
more of the equity interest or beneficial interest) of any Guarantor or any
Borrower; or 10% or more of any class of the outstanding voting stock (or
in the case of a Person which is not a corporation, 10% or more of the
equity interest or beneficial interest) of which is beneficially owned or
held by any Guarantor or any Borrower; provided, however, at the time any
Guarantor registers any security issued by it pursuant to the Securities
Act of 1933, as amended, the figure "10%" used in this definition shall
automatically change to "5%" without further action. The term "control"
means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether
through ownership of voting stock, by contract or otherwise.
"Aircraft" means any Stage III fixed wing airframe together with the
jet Engines therefor (whether or not) affixed thereto.
"Aircraft Portfolio" means the collective reference to all of the
Aircraft owned by any Subsidiary of Holdings or Irish Holdings at any one
time.
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"Amended and Restated Credit Agreement" has the meaning given to such
term in the first recital to this Agreement.
"Applicable Aircraft Advance Rate" with respect to any Eligible
Aircraft means:
(a) if the number of Eligible Aircraft in the Aircraft Portfolio is
less than or equal to 14, 40%;
(b) if the number of Eligible Aircraft in the Aircraft Portfolio is
greater than 14 and less than or equal to 24, 50%; or
(c) if the number of Eligible Aircraft in the Aircraft Portfolio is
greater than 24 and (i) such Eligible Aircraft is a category A Aircraft as
listed on Exhibit K, 60% or (ii) such Eligible Aircraft is a category B
Aircraft as listed on Exhibit K, 50%.
"Applicable Aircraft Borrowing Base" with respect to any Eligible
Aircraft means the product of (a) the sum of (i) the Purchase Price of such
Eligible Aircraft, (ii) the cost of any Approved Improvements in respect of
such Eligible Aircraft and (iii) the cost of any Qualified Conversion in
respect of such Eligible Aircraft and (b) the Applicable Aircraft Advance
Rate.
"Applicable Borrower" means, with respect to any Financed Aircraft,
the Borrower that has requested or received a Loan to enable such Borrower
to purchase or refinance such Financed Aircraft.
"Applicable Carrier" means, with respect to any Financed Aircraft, the
Eligible Carrier that has leased such Financed Aircraft from the Applicable
Borrower, or from the Applicable Intermediary in accordance with Section
2.15.
"Applicable Commitment Percentage" means, with respect to each Lender
at any time, a fraction, the numerator of which shall be such Lender's
Revolving Credit Commitment and the denominator of which shall be the Total
Revolving Credit Commitment, which Applicable Commitment Percentage for
each Lender as of the Closing Date is as set forth in Exhibit A; provided
that the Applicable Commitment Percentage of each Lender shall be increased
or decreased to reflect any assignments to or by such Lender effected in
accordance with Section 11.1.
"Applicable Foreign Aviation Law" means, with respect to any Aircraft,
any applicable law (other than the FAA Act) of any country or subdivision
thereof, governing the registration, ownership, operation, or leasing of
all or any part of such Aircraft, or the creation, recordation,
maintenance, perfection or priority or Liens on all or any part of such
Aircraft.
"Applicable Foreign Jurisdiction" means, with respect to any Aircraft,
any jurisdiction that administers an Applicable Foreign Aviation Law.
"Applicable Intermediary" means, with respect to any Financed
Aircraft, the Eligible Intermediary that has leased such Aircraft from the
Applicable Borrower, and
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has leased such Aircraft to the Applicable Carrier, in each case in
accordance with Section 2.15.
"Applicable Lease Cure Period" has the meaning assigned thereto in
Section 9.6.
"Applicable Lending Office" means, for each Lender and for each Type
of Loan, the "Lending Office" for such Lender (or of an affiliate of such
Lender) designated for such Type of Loan on the signature pages hereof or
such other office of such Lender (or an affiliate of such Lender) as such
Lender may from time to time specify to the Agent and the Borrowers by
written notice in accordance with the terms hereof as the office by which
its Loans are to be made and maintained.
"Applicable Margin" means:
(a) with respect to the Eurodollar Rate, 1.50%, provided that
during the Term Out Period, the Applicable Margin with respect to the
Eurodollar Rate shall be 2.00%; and
(b) with respect to the Base Rate, one half of one percent
(.50%), provided that during the Term Out Period, the Applicable
Margin with respect to the Base Rate shall be one percent (1.00%).
"Approved Improvements" means improvements made or added to an
Eligible Aircraft acceptable to the Agent in its reasonable judgment.
"Assignment and Acceptance" means an Assignment and Acceptance
substantially in the form of Exhibit B (with blanks appropriately filled
in) delivered to the Agent in connection with an assignment of a Lender's
interest under this Agreement pursuant to Section 11.1.
"Assumption Letter" means an Assumption Letter in substantially the
form of Exhibit Q.
"Authorized Representative" means any of the President, Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer or Vice
President of Holdings or Irish Holdings, as applicable, or any Beneficial
Owner, in each case as authorized representative for each of the Borrowers,
or any other Person expressly designated by the Board of Directors of each
of the Borrowers (or the appropriate committee thereof) as an Authorized
Representative of each of the Borrowers as set forth from time to time in a
certificate in the form of Exhibit C.
"Base Rate" means, for any day, the rate per annum equal to the sum of
(a) the higher of (i) the Federal Funds Rate for such day plus one-half of
one percent (0.5%) and (ii) the Prime Rate for such day, plus (b) the
Applicable Margin. Any change in the Base Rate due to a change in the Prime
Rate or the Federal Funds Rate shall be effective on the effective date of
such change in the Prime Rate or Federal Funds Rate.
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"Base Rate Loan" means a Loan for which the rate of interest is
determined by reference to the Base Rate.
"Beneficial Owner" means, with respect to any Holdings Subsidiary
Trust, any Person who is a direct or indirect wholly-owned subsidiary of
Holdings or Irish Holdings holding a beneficial interest in such Holdings
Subsidiary Trust.
"Board" means the Board of Governors of the Federal Reserve System (or
any successor body).
"Borrower" has the meaning given to such term in the preamble to this
Agreement.
"Borrowing Affiliate" means any direct or indirect wholly-owned
Subsidiary of Holdings or Irish Holdings and any Holdings Subsidiary Trust
or Holdings SPC that in either case is designated as a Borrowing Affiliate
hereunder pursuant to Section 2.13 hereof.
"Borrowing Base" means, as of any date of determination, the aggregate
of the Applicable Aircraft Borrowing Bases for all Eligible Aircraft.
However, (a) the Applicable Aircraft Advance Rate and the Applicable
Aircraft Borrowing Base for any Unleasable Financed Aircraft shall be zero
and (b) if a Borrowing Base Event occurs with respect to any Borrower or a
Subsidiary thereof then the Applicable Aircraft Advance Rate and the
Applicable Aircraft Borrowing Base for each Financed Aircraft owned by such
Borrower shall be zero.
(a) "Borrowing Base Event" means, with respect to any Borrower, if (i)
one or more judgments or orders where the amount not covered by insurance
(or the amount as to which the insurer denies liability) is in excess of
$250,000 is rendered against such Borrower or any Subsidiary thereof, or
(ii) there is any attachment, injunction or execution against any of such
Borrower's or Subsidiaries' properties for any amount in excess of $250,000
in the aggregate; and such judgment, attachment, injunction or execution
remains unpaid, unstayed, undischarged, unbonded or undismissed for a
period of thirty (30) days.
"Borrowing Notice" means the notice delivered by an Authorized
Representative in connection with a Loan under the Revolving Credit
Facility, in the form of Exhibit D.
"Business Day" means, (i) with respect to any Base Rate Loan, any day
which is not a Saturday, Sunday or a day on which banks in the State of New
York are authorized or obligated by law, executive order or governmental
decree to be closed and, (ii) with respect to any Eurodollar Rate Loan, any
day which is a Business Day, as described above, and on which the relevant
international financial markets are open for the transaction of business
contemplated by this Agreement in London, England and New York, New York.
"Capital Expenditures" means, with respect to the Borrowers and their
respective Subsidiaries, for any period the sum of (without duplication)
(i) all expenditures (whether
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paid in cash or accrued as liabilities) by any Borrower or any Subsidiary
during such period for items that would be classified as "property, plant
or equipment" or comparable items on the consolidated balance sheet of any
Borrowers and its respective Subsidiaries, including without limitation all
transactional costs incurred in connection with such expenditures provided
the same have been capitalized, excluding, however, the amount of any
Capital Expenditures paid for with proceeds of casualty insurance as
evidenced in writing and submitted to the Agent together with any
compliance certificate delivered pursuant to Section 7.1(a) or (b), and
(ii) with respect to any Capital Lease entered into by any Borrower or its
Subsidiaries during such period, the present value of the lease payments
due under such Capital Lease over the term of such Capital Lease applying a
discount rate equal to the interest rate provided in such lease (or in the
absence of a stated interest rate, that rate used in the preparation of the
financial statements described in Section 7.1(a)), all the foregoing in
accordance with GAAP.
"Capital Leases" means all leases which have been or should be
capitalized in accordance with GAAP as in effect from time to time
including Statement No. 13 of the Financial Accounting Standards Board and
any successor thereof.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants, rights or options to purchase any of
the foregoing.
"Change of Control" means, at any time, 100% of the beneficial
ownership of any Guarantor or any Borrower or any Eligible Intermediary if
not owned, directly or indirectly, by Holdings or Irish Holdings or 100% of
the beneficial ownership of Holdings or Irish Holdings if not owned,
directly or indirectly, by Parent.
"Closing Date" means the date as of which this Agreement is executed
by the Borrowers, the Lenders and the Agent and on which the conditions set
forth in Section 5.1 have been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder.
"Collateral" means, collectively, all property of any Borrower, any
Subsidiary, any Eligible Intermediary or any other Person (including
Holdings and Irish Holdings) in which the Agent or any Lender is granted a
Lien as security for all or any portion of the Obligations, other than
Obligations of ABH 12 created or incurred in connection with the ABH 12-JPM
Swap Agreement, under any Security Instrument including, without
limitation, the Leases, the Pledged Interests and the other collateral
described in such Security Agreement, Pledge Agreement, Lockbox Agreement
and other Security Instrument. For the avoidance of doubt, none of the
Security Instruments shall provide for the grant of a perfected security
interest on the Financed Aircraft.
"Contingent Obligation" of any Person means all contingent liabilities
required (or which, upon the creation or incurring thereof, would be
required) to be included in the
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financial statements (including footnotes) of such Person in accordance
with GAAP, including Statement No. 5 of the Financial Accounting Standards
Board, all Rate Hedging Obligations and any obligation of such Person
guaranteeing or in effect guaranteeing any Indebtedness, dividend or other
obligation of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including obligations of such Person
however incurred:
(1) to purchase such Indebtedness or other obligation or any
property or assets constituting security therefor;
(2) to advance or supply funds in any manner (i) for the purchase
or payment of such Indebtedness or other obligation, or (ii) to
maintain a minimum working capital, net worth or other balance sheet
condition or any income statement condition of the primary obligor;
(3) to grant or convey any lien, security interest, pledge,
charge or other encumbrance on any property or assets of such Person
to secure payment of such Indebtedness or other obligation;
(4) to lease property or to purchase securities or other property
or services primarily for the purpose of assuring the owner or holder
of such Indebtedness or obligation of the ability of the primary
obligor to make payment of such Indebtedness or other obligation; or
(5) otherwise to assure the owner of the Indebtedness or such
obligation of the primary obligor against loss in respect thereof.
"Continue", "Continuation", and "Continued" refers to the continuation
pursuant to Section 2.8 hereof of a Eurodollar Rate Loan of one Type as a
Eurodollar Rate Loan of the same Type from one Interest Period to the next
Interest Period.
"Contribution Agreement" means the Amended and Restated Contribution
Agreement dated the Closing Date, entered into by and between ABH 12 and
Holdings, substantially in the form of Exhibit T.
"Contribution Agreement Guarantor" means the Guarantor as defined in
the Contribution Guaranty Agreement.
"Contribution Agreement Guaranty" means that certain Guaranty
Agreement dated the Closing Date, entered into by and among Irish Holdings
and each Borrower for the benefit of ABH 12 to guaranty the obligations of
Holdings under the Contribution Agreement, substantially in the form of
Exhibit U.
"Contribution Agreement Letter Agreements" means the collective
reference to Contribution Letter Agreement No. 1 and to Contribution Letter
Agreement No. 2.
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"Contribution Agreement Letter Agreement No. 1" means that certain
letter agreement dated the Closing Date, by and among Irish Holdings, each
Borrower and JPMorgan Chase Bank, N.A.
"Contribution Agreement Letter Agreement No. 2" means that certain
letter agreement dated the Closing Date, by and among each Contribution
Agreement Guarantor, ABH 12 and JPMorgan Chase Bank, N.A.
"Convention" means the Convention on the International Recognition of
Rights in Aircraft signed initially at Geneva in 1948, as the same may be
amended, modified or supplemented from time to time. "Convert",
"Conversion", and "Converted" refers to a conversion pursuant to Section
2.8 or Article IV of one Type of Loan into another Type of Loan.
"Credit Party" means, collectively, each Borrower, each Eligible
Intermediary, each Guarantor, and each other Person (if any) providing
Collateral pursuant to any Security Instrument.
"Default" means any event or condition which, with the giving or
receipt of notice or lapse of time or both, would constitute an Event of
Default hereunder, provided that if, pursuant to Section 9.6, such event or
condition is not deemed to be a breach of the Credit Parties' obligations
under this Agreement and the other Loan Documents, such event or condition
shall not be deemed to be a "Default" except for the purposes of Section
7.11, the first two sentences of Section 10.3, the Compliance Certificate
in the form of Exhibit H, and Section 4 of the Borrowing Base Certificate
in the form of Exhibit R.
"Default Rate" means (i) with respect to each Eurodollar Rate Loan,
until the end of the Interest Period applicable thereto, a rate of two
percent (2%) above the Eurodollar Rate applicable to such Loan, and
thereafter at a rate of interest per annum which shall be two percent (2%)
above the Base Rate, (ii) with respect to Base Rate Loans, at a rate of
interest per annum which shall be two percent (2%) above the Base Rate and
(iii) in any case, the maximum rate permitted by applicable law, if lower.
"Depositary Bank" means a bank, trust company or other Person,
satisfactory to the Agent, that executes the Lockbox Agreement in the
capacity of "Depositary Bank" thereunder.
"Dollars" and the symbol "$" means dollars constituting legal tender
for the payment of public and private debts in the United States of
America.
"Eligible Aircraft" means any Aircraft which satisfies each of the
following requirements:
(a) such Aircraft is a Stage III aircraft and is one of the
models listed on Exhibit K attached hereto;
8
(b) such Aircraft is owned by the Applicable Borrower;
(c) such Aircraft is covered by all of the insurance described on
Exhibit L attached hereto and the Agent (for itself and on behalf of
the Lenders) is named as loss payee or contract party on the hull
insurance and is named as an additional insured or contract party on
the liability insurance;
(d) neither the Applicable Carrier (if any) nor the Applicable
Intermediary (if any) is organized under the laws of, or domiciled in,
any Prohibited Country; and
(e) the age of such Aircraft is (i) in the case of a passenger
aircraft, 19 years or less and (ii) in the case of a freighter
aircraft, 25 years or less, in each case measured from the date of
original manufacture as a passenger aircraft or a freighter aircraft,
as the case may be, to the date of the original Loan made or to be
made in respect of such Eligible Aircraft.
"Eligible Assignee" means (i) a Lender, (ii) an affiliate of a Lender,
and (iii) any other financial institution approved by the Agent; provided,
however, that neither any Borrower nor an affiliate of any Borrower shall
qualify as an Eligible Assignee.
"Eligible Carrier" means any air carrier duly licensed to carry
passengers or cargo under applicable law, foreign or domestic.
"Eligible Intermediary" means, with respect to any Financed Aircraft,
a Person that is a direct, wholly-owned subsidiary of the Applicable
Borrower or, in the case with the Eligible Aircraft with manufacturer's
serial number 967, Sierra Leasing Limited.
"Eligible Lease" or "Eligible Leases" means a fully-executed Lease by
a Borrower or Eligible Intermediary (as lessor) to an Eligible Carrier (as
lessee) of an Eligible Aircraft, which Lease satisfies each of the
following requirements:
(a) such Lease is a "triple net lease" (subject to any
arrangement whereby the Borrower and the Eligible Carrier agree to
share certain expenses relating to aircraft or engine maintenance,
directives, service bulletins or similar items) and requires the
lessee to maintain the insurance described in Exhibit L attached
hereto with respect to such Aircraft, and to bear all risk of loss,
damage or liability with respect to such Aircraft;
(b) if the Eligible Carrier is domiciled in the United States,
the lessor is entitled to the benefits of Section 1110 of the U.S.
bankruptcy code with respect to the lessor's rights against such
lessee, including without limitation the rights to require performance
of such lessee's obligations under the Lease or return such Aircraft
during such lessee's bankruptcy or insolvency;
(c) such Lease requires the lessee to comply with covenants and
restrictions regarding the maintenance, return, alteration,
replacement, pooling
9
and sublease of such Aircraft, which covenants and restrictions
satisfy the requirements of Section 7.19(a) and Schedule 7.19(a)
hereto;
(d) if such Lease contains a purchase option, the expected
exercise price is equal to or greater than the expected outstanding
principal and accrued interest on all Loans relating to such Aircraft
as of the date of exercise of such option;
(e) such Lease prohibits the lessee from flying or locating such
Aircraft in any country in violation of the applicable laws of any
jurisdiction;
(f) such Lease provides rent payments in US dollars and contains
customary covenants and restrictions relating to re-registration of
such Aircraft; which covenants and restrictions satisfy the
requirements of the Security Agreement;
(g) at the time of any Loan hereunder relating to such Aircraft
or, if later, at the time of the entering into such Lease, no
prepayment shall have been made under such Lease, and no Lease payment
obligation shall have been accelerated, provided that it is understood
that a scheduled rental payment to be paid in advance for a rental
period in accordance with the Lease terms is not deemed to be a
prepayment;
(h) at the time of any Loan relating to such Aircraft or, if
later, at the time of the delivery of such Aircraft under such Lease,
the applicable lessor shall have delivered a Lessee Notice to the
applicable lessee; and
(i) either (i) such Lease is a "true lease" lease (and not a
lease intended as security) under applicable commercial law and other
applicable law relating to creditors' rights and bankruptcy; or (ii)
such Lease grants to such Borrower, and such Borrower has at all times
under the FAA Act (in the case of Aircraft registered in the United
States), a perfected first priority mortgage Lien on such Aircraft
(subject only to Permitted Liens), which Lien has been assigned to the
Agent;
provided, however, that in the circumstances described in Section 2.15,
"Eligible Lease" means, individually and collectively, (X) a fully-executed
Lease by a Borrower (as lessor) to the Applicable Intermediary (as lessee) of an
Eligible Aircraft, which Lease satisfies each of the requirements for an
"Eligible Lease" set forth in clauses (a) through (h) above except that the
lessee is not an Eligible Carrier, and (Y) a fully-executed sublease by such
Applicable Intermediary (as sublessor) to an Eligible Carrier (as sublessee) of
such Financed Aircraft, which Eligible Carrier is not a U.S. Carrier, and which
Lease is identical in all material respects (other than the Persons that are
lessor and lessee) to the Lease described in clause (X) above, and which Lease
satisfies all the requirements for an "Eligible Lease" set forth in clauses (a)
through (i) above, except that the lessor is not a Borrower.
"Employee Benefit Plan" means, at a particular time, any employee
benefit plan that is covered by ERISA and in respect of which any Guarantor
or any Borrower or any
10
of their respective ERISA Affiliates is (or, if such plan were terminated
at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" as defined in Section 3(5) of ERISA.
"Engine" means any aircraft jet engine.
"Environmental Laws" means any federal, state or local statute, law,
ordinance, code, rule, regulation, order, decree, permit or license
regulating, relating to, or imposing liability or standards of conduct
concerning, any environmental matters or conditions, environmental
protection or conservation, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended; the Superfund Amendments and Reauthorization Act of 1986,
as amended; the Resource Conservation and Recovery Act, as amended; the
Toxic Substances Control Act, as amended; the Clean Air Act, as amended;
the Clean Water Act, as amended; together with all regulations promulgated
thereunder, and any other "Superfund" or "Superlien" law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means an entity, whether or not incorporated, that
is under common control with any Guarantor or any Borrower within the
meaning of Section 4001 of ERISA or is part of a group that includes any
Guarantor or any Borrower and that is treated as a single employer within
the meaning of Section 414 of the Code.
"Eurodollar Rate" means the interest rate per annum calculated
according to the following formula:
Eurodollar Interbank Offered Rate Applicable
----------------------
Rate = 1- Reserve Requirement + Margin
"Eurodollar Rate Loan" means a Loan for which the rate of interest is
determined by reference to the Eurodollar Rate.
"Event of Default" means any of the occurrences set forth as such in
Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the regulations promulgated thereunder.
"FAA" means the United States Federal Aviation Administration.
"FAA Act" means 49 U.S.C. Subtitle VII, Sections 40101 et seq., as
amended from time to time, any regulations promulgated thereunder and any
successor provision.
"FAA Counsel" means DeBee & Gilchrist, Daugherty, Xxxxxx and Xxxxxxxx,
Xxxxxx and Xxxxxx, Xxxxx & Xxxxxxx, or any other law firm having nationally
recognized expertise in FAA matters acceptable to the Agent.
11
"FAA Recording Office" means the office of the FAA in Oklahoma City,
Oklahoma, maintained as the office for the recordation of Liens on Aircraft
and pursuant to the FAA Act, and any successor or additional office
performing the same or a comparable function.
"Facility Guaranty" means each Guaranty Agreement between one or more
Guarantors and the Agent for the benefit of the Lenders (substantially in
the form of Exhibit I attached hereto), delivered as of the Initial Closing
Date and otherwise pursuant to Section 2.13, 5.1 or 5.3, as the same may be
amended, modified or supplemented from time to time.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on the
next succeeding Business Day, and (b) if no such rate is so published on
such next succeeding Business Day, the Federal Funds Rate for such day
shall be the average rate charged to the Agent (in its individual capacity)
on such day on such transactions as determined by the Agent.
"Fee Letter" means the Fee Letter dated January 24, 2005, as amended
and restated August 3, 2005, by JPMorgan Chase Bank, N.A., X.X. Xxxxxx
Securities Inc., Bear Xxxxxxx & Co. Inc. and Bear Xxxxxxx Corporate Lending
Inc. and accepted and agreed to by the Parent.
"Fee Payment Date" means, for any month in which a commitment fee is
due, the twentieth (20th ) calendar day of each calendar month (or, if such
day is not a Business Day, on the next succeeding Business Day).
"Financed Aircraft" with respect to any Loan means, collectively, each
Aircraft, or part thereof, the acquisition of which was or is to be
financed or refinanced in whole or in part by such Loan.
"Fiscal Year" means the twelve-month fiscal period of Holdings, Irish
Holdings, the Borrowers and their Subsidiaries commencing on January 1 of
each calendar year and ending on December 31 of each calendar year.
"Foreign Benefit Law" means any applicable statute, law, ordinance,
code, rule, regulation, order or decree of any foreign nation or any
province, state, territory, protectorate or other political subdivision
thereof regulating, relating to, or imposing liability or standards of
conduct concerning, any Employee Benefit Plan.
"GAAP" or "Generally Accepted Accounting Principles" means generally
accepted accounting principles, being those principles of accounting set
forth in pronouncements of the Financial Accounting Standards Board, the
American Institute of
12
Certified Public Accountants or which have other substantial authoritative
support and are applicable in the circumstances as of the date of a report.
"Governmental Authority" means any Federal, state, municipal, national
or other governmental department, commission, board, bureau, court, agency
or instrumentality or political subdivision thereof or any entity or
officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court,
in each case whether associated with a state of the United States, the
United States, or a foreign entity or government.
"Guaranties" means the Facility Guaranties, the Contribution Agreement
Guaranty and all other obligations of any Borrower or any other Person
directly guaranteeing any Indebtedness or other obligation of any other
Person.
"Guarantors" means, at any date, Holdings, Irish Holdings, ABH 12 and
the Beneficial Owners, Eligible Intermediaries and Subsidiaries who are
required to be parties to a Facility Guaranty at such date.
"Hazardous Material" means and includes any pollutant, contaminant, or
hazardous, toxic or dangerous waste, substance or material (including
without limitation petroleum products, asbestos-containing materials and
lead), the generation, handling, storage, transportation, disposal,
treatment, release, discharge or emission of which is subject to any
Environmental Law.
"Holdings SPC" means a Subsidiary, 100% of the voting and equity
interests in which are owned directly or indirectly by Holdings or Irish
Holdings.
"Holdings" has the meaning given to such term in the preamble to this
Agreement.
"Holdings Subsidiary Trust" means any trust (a) that is organized
under the laws of a state of the United States, (b) whose trustee is a
Qualified Trustee and (c) in which 100% of all beneficial interests are
owned directly by a direct or indirect wholly-owned Subsidiary of Holdings
or Irish Holdings.
"Indebtedness" means with respect to any Person, without duplication,
all Indebtedness for Money Borrowed, all indebtedness of such Person for
the acquisition of property or arising under Rate Hedging Obligations, all
indebtedness secured by any Lien on the property of such Person whether or
not such indebtedness is assumed, all liability of such Person by way of
endorsements (other than for collection or deposit in the ordinary course
of business), all Contingent Obligations, and other items which in
accordance with GAAP is required to be classified as a liability on a
balance sheet; but excluding all accounts payable in the ordinary course of
business so long as payment therefor is due within one year; provided that
in no event shall the term Indebtedness include surplus and retained
earnings, lease obligations (other than pursuant to Capital Leases),
reserves for deferred income taxes and investment credits, other deferred
credits or reserves or deferred compensation obligations.
13
"Indebtedness for Money Borrowed" means with respect to any Person,
without duplication, all indebtedness in respect of money borrowed, as
reflected on the balance sheet of such Person in accordance with GAAP,
including without limitation all Capital Leases and the deferred purchase
price of any property or asset, evidenced by a promissory note, bond,
debenture or similar written obligation for the payment of money (including
conditional sales or similar title retention agreements), other than trade
payables incurred in the ordinary course of business.
"Initial Closing Date" means February 28, 2005.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA.
"Insolvent" means to pertain to a condition of Insolvency.
"Interbank Offered Rate" means, with respect to any Eurodollar Rate
Loan for the Interest Period applicable thereto, the rate per annum
(rounded upwards, if necessary), to the nearest 1/100 of 1%) appearing on
Telerate Page 3750 (or any successor page) as the London interbank offered
rate for deposits in Dollars at approximately 11:00 A.M. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period (or, if no such comparable term is
quoted, an interpolated rate as reasonably determined by the Agent). If for
any reason such rate is not available, the term "Interbank Offered Rate"
shall mean, with respect to any Eurodollar Rate Loan for the Interest
Period applicable thereto, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO
Page as the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the first
day of such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen
LIBO Page, the applicable rate shall be the arithmetic mean of all such
rates (rounded upwards, if necessary, to the nearest 1/100 of 1%).
"Interest Period" means, for each Eurodollar Rate Loan, a period
commencing on the date such Eurodollar Rate Loan is made or Converted or on
the last day of the preceding Interest Period, as the case may be, and
ending on (x) the next occurring day that is the fifteenth day of a
calendar month or (y) in the case of an Interest Period of one week, the
last day of such week (provided, that Interest Periods of one week in
duration may not be selected by a Borrower other than in anticipation of a
prepayment of a Loan); provided, that,
(a) if an Interest Period for a Eurodollar Rate Loan would end on
a day which is not a Business Day, such Interest Period shall be
extended to the next Business Day (unless such extension would cause
the applicable Interest Period to end in the succeeding calendar
month, in which case such Interest Period shall end on the next
preceding Business Day);
14
(b) except in the case of a one-week Interest Period, any
Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on
the last Business Day of a calendar month; and
(c) no Interest Period shall extend past the first anniversary of
the Stated Termination Date for Revolving Loans.
"Interest Rate Selection Notice" means the written notice delivered by
an Authorized Representative in connection with the election of a
subsequent Interest Period for any Eurodollar Rate Loan or the Conversion
of any Base Rate Loan into a Eurodollar Rate Loan, in the form of Exhibit
E.
"Irish Holdings" has the meaning given such term in the preamble to
this Agreement.
"Lease" has the meaning given in the Security Agreement.
"Lease Event of Default" means any event characterized as an "event of
default" (or the equivalent) under any Lease of any Aircraft (or that would
be so characterized assuming the sending of any required notice by the
lessor in a timely manner).
"Lender" has the meaning given to such term in the preamble to this
Agreement.
"Lessee Notice" means a certificate in form and substance reasonably
acceptable to the Agent, duly completed and executed by an Applicable
Borrower with respect to an Aircraft; and the Agent agrees that the form of
Lessee Notice attached hereto as Exhibit M is acceptable.
"Lien" means any interest in property securing any obligation owed to,
or a claim by, a Person other than the owner of the property, whether such
interest is based on the common law, statute or contract, and including but
not limited to the lien or security interest arising from a mortgage,
encumbrance, pledge, security agreement, conditional sale or trust receipt
or a lease, consignment or bailment for security purposes. For the purposes
of this Agreement, any Borrower and any Subsidiary shall be deemed to be
the owner of any property which it has acquired or holds subject to a
conditional sale agreement, financing lease, or other arrangement pursuant
to which title to the property has been retained by or vested in some other
Person for security purposes.
"Loan" or "Loans" means any of the Revolving Loans.
"Loan Documents" means this Agreement, the Notes (if any), the
Contribution Agreement, the Contribution Agreement Letter Agreements, the
Security Instruments, the Facility Guaranties, the Contribution Agreement
Guaranty, the Parent Support Agreement, the Assumption Letters, the Omnibus
Amendment, the Second Omnibus Amendment and all other instruments and
documents heretofore or hereafter executed or delivered to or in favor of
any Lender or the Agent in connection with the Loans made
15
and transactions contemplated under this Agreement, as the same may be
amended, supplemented or replaced from the time to time.
"Lockbox Agreement" means a lockbox agreement between each Borrower,
the Depositary Bank and the Agent substantially the form of Exhibit O
hereto, as supplemented from time to time in accordance with the terms
thereof.
"Manufacturer" means any manufacturer of any Financed Aircraft.
"Manufacturer's Warranty" means any warranty made or offered by any
Manufacturer with respect to any Financed Aircraft.
"Material Adverse Effect" means a material adverse effect on (i) the
ability of the Credit Parties, taken as a whole, to pay or perform its
respective obligations, liabilities and indebtedness under the Loan
Documents as such payment or performance becomes due in accordance with the
terms thereof, or (ii) the rights, powers and remedies of the Agent or any
Lender under any Loan Document or the validity, legality or enforceability
thereof.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Multiemployer Plan" means an Employee Benefit Plan that is a
"multiemployer plan" as defined in Section 4001(a)(3) of ERISA to which any
Borrower or any ERISA Affiliate is making, or is accruing an obligation to
make, contributions or has made, or been obligated to make, contributions
within the preceding six (6) Fiscal Years.
"Notes" means, collectively, the promissory notes (if any) of the
Borrowers evidencing Revolving Loans executed and delivered to the Lenders
as provided in Section 2.5 substantially in the form of Exhibit F, with
appropriate insertions as to amounts, dates and names of Lenders.
"Obligations" means the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of the
Loans and interest accruing after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
relating to Holdings, Irish Holdings, ABH 12 or any Borrower, whether or
not a claim for post-filing or post-petition interest is allowed in such
proceeding) the Loans and all other obligations and liabilities of
Holdings, Irish Holdings, ABH 12 or any Borrower to the Agent (acting in
any capacity) or to any Lender (or, in the case of Rate Hedging
Obligations, any affiliate of any Lender), whether direct or indirect,
absolute or contingent, due or to become due, or now existing or hereafter
incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, any Rate Hedging Obligation entered
into with any Lender or any affiliate of any Lender or any other document
made, delivered or given in connection herewith or therewith, whether on
account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation, all fees,
charges and disbursements of counsel to the Agent (acting in any capacity)
or to any Lender that are required to be paid by Holdings, Irish Holdings,
ABH 12 or any Borrower pursuant thereto) or otherwise; provided that,
notwithstanding any provision of any
16
Facility Guaranty, the Contribution Agreement Guaranty or any other Loan
Document to the contrary, Obligations of any Credit Party other than ABH 12
shall not include any Rate Hedging Obligations of ABH 12 created by or
incurred in connection with the ABH 12-JPM Swap Agreement.
"Omnibus Amendment" means the Omnibus Amendment and Reaffirmation of
Guaranties, dated as of the date August 3, 2005, executed by each Credit
Party party to any Facility Guaranty, Security Agreement, Pledge Agreement
or Lockbox Agreement existing as of such date.
"Operating Circular" means an operating circular issued by the Federal
Reserve Bank.
"Organizational Action" means with respect to any corporation, limited
liability company, partnership, limited partnership, limited liability
partnership, trust or other legally authorized incorporated or
unincorporated entity, any corporate, organizational or partnership action
(including any required shareholder, trustee, member or partner action), or
other similar official action, as applicable, taken by such entity.
"Organizational Documents" means with respect to any corporation,
limited liability company, partnership, limited partnership, limited
liability partnership, trust or other legally authorized incorporated or
unincorporated entity, (i) the articles of incorporation, certificate of
incorporation, articles of organization, certificate of limited
partnership, trust agreement or other applicable organizational or charter
documents relating to the creation of such entity which will, in each case,
contain provisions reasonably satisfactory to the Lenders to ensure such
entity's bankruptcy remoteness, including provisions relating to the
appointment of a special member or independent director, the consent of
which will be required to approve any decisions related to bankruptcy
matters and (ii) the bylaws, operating agreement, partnership agreement,
limited partnership agreement or other applicable documents relating to the
operation, governance or management of such entity.
"Parent" means Aircastle Investment Limited, an exempted company
organized and existing under the laws of Bermuda.
"Parent Support Agreement" means the Second Amended and Restated
Support Agreement executed by Parent substantially in the form of Exhibit
N.
"Partnership Interests" has the meaning therefor provided in the
Pledge Agreement.
"Payment Date" means any date provided for herein on which the
principal of, interest on or other amounts in respect of the Loans is due
and payable.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereto.
17
"Permanent Capital Markets Financing" means an aircraft lease
securitization, enhanced equipment trust certificate or other permanent
aircraft-secured public or private capital markets transaction (which, in
each case, does not constitute bridge or interim financing) for the benefit
of Parent, Holdings or Irish Holdings or a subsidiary of Holdings or Irish
Holdings, occurring after the date hereof.
"Permitted Lien" means any Lien permitted by Section 8.3.
"Person" means an individual, partnership, corporation, limited
liability company, limited liability partnership, trust, unincorporated
organization, association, joint venture or a government or agency or
political subdivision thereof.
"Pledge Agreement" means, collectively (or individually as the context
may indicate), (i) that certain Pledge and Security Agreement dated as of
February 25, 2005 between Holdings and the Agent (for the benefit of the
Agent and the Lenders), (ii) that certain Pledge and Security Agreement
dated as of the date hereof between Irish Holdings and the Agent (for the
benefit of the Agent and the Lenders), and (iii) any additional Pledge and
Security Agreement or Share Charge (substantially in the form of Exhibit
X-0, X-0 or S-3 attached hereto, as applicable), delivered to the Agent
pursuant to Section 5.1, 5.2, 5.3 or 2.13, as hereafter amended,
supplemented or replaced from time to time. For the avoidance of doubt, the
Parent shall not be a party to any Pledge Agreement.
"Pledged Interests" has the meaning given to such term in the Pledge
Agreement.
"Prime Rate" means the per annum rate of interest established from
time to time by the Reference Bank as its prime or reference rate, which
rate may not be the lowest rate of interest charged by the Reference Bank
to its customers.
"Principal Office" means the principal office of the Agent presently
located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such other office
and address as the Agent may from time to time designate. Payments shall be
made to the account specified in the Lockbox Agreement or to such other
account as the Agent may from time to time specify in writing.
"Prohibited Countries" means any country in which an Aircraft would
not be covered by the insurance requirements of Section 3.7 of the Security
Agreement (including, if required, political risk insurance), any country
with which the United States does not maintain normal diplomatic relations
and any country where or with nationals of which it is unlawful for Persons
subject to the jurisdiction of the United States to conduct business
without material restrictions or limitations.
"Purchase Price" with respect to any Aircraft means the actual
purchase price paid for such Aircraft by the Applicable Borrower, together
with all other reasonable out of pocket expenses (including reasonable
attorneys fees of each of the Borrower and the Agent) incurred or which is
estimated by the Borrower to be incurred in respect of such Aircraft, in
each case reasonably acceptable to the Agent.
18
"Qualified Conversion" means the conversion of a Financed Aircraft
from passenger configuration to a freighter configuration that meets the
following conditions: (a) such conversion is performed by a conversion
company that is well established with a program that has an FAA granted
Supplemental Type Certificate to perform the intended work; (b) the
conversion work is performed pursuant to a contract, assigned to the
Lenders as collateral security, on terms and conditions that are reasonably
acceptable to the Lenders; and (c)(i) the senior unsecured long-term debt
rating of the conversion company is not less than BBB/Baa2 or (ii) the
conversion company has caused a performance bond, letter of credit or other
security naming the Agent as beneficiary, in an amount equal to 125% of the
Loan of such Financed Aircraft, in each case in form and substance
satisfactory to the Lenders to be issued by a surety or other Person
customarily engaged in the performance bonding and surety business or
issuing letters of credit reasonably acceptable to the Lenders.
"Qualified Trustee" means (i) Wilmington Trust Company, Xxxxx Fargo
Bank Northwest, N.A., JPMorgan Chase Bank, N.A., or another bank or trust
company having a combined capital and surplus of at least One Hundred
Million Dollars ($100,000,000) or (ii) any other Person acceptable to the
Agent.
"Quarterly Period" means a fiscal quarter of the Borrowers and their
Subsidiaries.
"Rate Hedging Obligations" means any and all obligations of Holdings,
Irish Holdings, ABH 12, any Borrower or any Subsidiary, whether absolute or
contingent and howsoever and whensoever created, arising, evidenced or
acquired (including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements, devices or
arrangements designed to protect at least one of the parties thereto from
the fluctuations of interest rates, exchange rates or forward rates
applicable to such party's assets, liabilities or exchange transactions,
including, but not limited to, Dollar-denominated or cross-currency
interest rate exchange agreements, forward currency exchange agreements,
interest rate cap or collar protection agreements, forward rate currency or
interest rate options, puts, warrants and those commonly known as interest
rate "swap" agreements; and (ii) any and all cancellations, buybacks,
reversals, terminations or assignments of any of the foregoing.
"Reference Bank" means JPMorgan Chase Bank, N.A.
"Regulation A" means a Regulation A circular issued by such Federal
Reserve Bank.
"Regulation D" means Regulation D of the Board as the same may be
amended or supplemented from time to time.
"Regulatory Change" means any change effective after the Initial
Closing Date in United States federal or state laws or regulations
(including Regulation D and capital adequacy regulations) or foreign laws
or regulations or the adoption or making after such date of any
interpretations, directives or requests applying to a class of banks, which
includes any of the Lenders, under any United States federal or state or
foreign laws or
19
regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof or compliance by any Lender with any request or
directive regarding capital adequacy, including those relating to "highly
leveraged transactions," whether or not having the force of law, and
whether or not failure to comply therewith would be unlawful and whether or
not published or proposed prior to the date hereof.
"Reorganization" means, with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event" means any of the events set forth in Section
4043(b) of ERISA, other than those events as to which the third day notice
period is waived by the PBGC.
"Required Lenders" means, as of any date, Lenders on such date having
Credit Exposures (as defined below) aggregating more than 50% of the
aggregate Credit Exposures of all the Lenders on such date. For purposes of
the preceding sentence, the amount of the "Credit Exposure" of each Lender
shall be equal at all times (a) other than following the occurrence and
during the continuance of an Event of Default, to the amount of its
Revolving Credit Commitment; and (b) following the occurrence and during
the continuance of an Event of Default, to the aggregate principal amount
of such Lender's Applicable Commitment Percentage of Revolving Credit
Outstandings; provided that, for the purpose of this definition only, if
any Lender shall have failed to fund its Applicable Commitment Percentage
of any Loan, the Revolving Credit Commitment of such Lender shall be deemed
reduced by the amount it so failed to fund for so long as such failure
shall continue and such Lender's Credit Exposure attributable to such
failure shall be deemed held by any Lender making more than its Applicable
Commitment Percentage of such Loan to the extent it covers such failure.
"Requirement of Law" means as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Reserve Requirement" means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of Governors of the
Federal Reserve System (or any successor) by member banks of the Federal
Reserve System against "Eurocurrency liabilities" (as such term is used in
Regulation D). Without limiting the effect of the foregoing, the Reserve
Requirement shall reflect any other reserves required to be maintained by
such member banks with respect to (i) any category of liabilities which
includes deposits by reference to which the Eurodollar Rate is to be
determined, or (ii) any category of extensions of credit or other assets
which include Eurodollar Rate Loans. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the Reserve
Requirement.
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"Revolving Credit Commitment" means, with respect to each Lender, the
obligation of such Lender to make Revolving Loans to the Borrowers up to an
aggregate principal amount at any one time outstanding equal to such
Lender's Applicable Commitment Percentage of the Total Revolving Credit
Commitment.
"Revolving Credit Facility" means the facility described in Article II
hereof providing for Loans to the Borrowers by the Lenders in the aggregate
principal amount of the Total Revolving Credit Commitment.
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Revolving Loans then
outstanding.
"Revolving Credit Termination Date" means the earliest of (i) the
Stated Termination Date, (ii) the date of termination of Lenders'
obligations pursuant to Section 9.1 upon the occurrence of an Event of
Default, or (iii) such date as the Borrowers may voluntarily and
permanently terminate the Revolving Credit Facility by payment in full of
all Revolving Credit Outstandings, together with all accrued and unpaid
interest thereon and reduce the Total Revolving Credit Commitment to zero
pursuant to Section 2.7.
"Revolving Loan" or "Revolving Loans" means any borrowing pursuant to
a Loan under the Revolving Credit Facility in accordance with Article II.
"S&P" means Standard & Poor's Ratings Group, a division of The
XxXxxx-Xxxx Companies, Inc., and any successor thereto.
"Second Omnibus Amendment" means the Second Omnibus Amendment and
Reaffirmation of Guaranties, dated as of the date hereof, executed by each
Credit Party party to any Security Instrument existing as of the date
hereof.
"Secured Party" has the meaning given in the Security Agreement.
"Security Agreement" means, collectively (or individually as the
context may indicate), any Security Agreement (substantially in the form of
Exhibit J attached hereto) delivered to the Agent pursuant to Section 2.13,
5.1, 5.2 or 5.3, as hereafter modified, amended or supplemented from time
to time.
"Security Instruments" means, collectively, the Pledge Agreement,
Security Agreement, the Lockbox Agreement, ABH 12 Security Agreement and
all other agreements, instruments and other documents, whether now existing
or hereafter in effect, pursuant to which any Borrower, any Beneficial
Owner, any Subsidiary, any Intermediary or any other Person shall grant or
convey to the Agent or the Lenders a Lien in property as security for all
or any portion of the Obligations, as any of them may be amended, modified
or supplemented from time to time.
"Servicing Agreement" means either (i) the Servicing Agreement, dated
as of March 4, 2005, between Aircastle Advisor LLC and the Agent or (ii)
the Servicing Agreement, dated as of the date hereof, between Aircastle
Advisor (Ireland) Limited and the Agent, as the context may require, in
substantially the form of Exhibit P attached.
21
"Servicer" means either Aircastle Advisor LLC or Aircastle Advisor
(Ireland) Limited, in each case, a wholly-owned Subsidiary of Aircastle
Investment Limited.
"Single Employer Plan" means any Employee Benefit Plan covered by
Title IV of ERISA which is not a Multiemployer Plan.
"Solvent" means, when used with respect to any Person, that at the
time of determination:
(i) the fair value of its assets (both at fair valuation and at
present fair saleable value on an orderly basis) is in excess of the
total amount of its liabilities, including Contingent Obligations; and
(ii) it is then able and expects to be able to pay its debts as
they mature;
(iii) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted; and
(iv) with respect to any Person incorporated in Ireland, such
Person is "unable to pay its debts" as that phrase is defined under
Irish law in Section 214 of the Companies Xxx 0000 and Section 2(3) of
the Companies (Amendment) Xxx 0000.
"Stated Termination Date" means February 24, 2006.
"Subsidiary" means any corporation or other entity in which more than
50% of its outstanding voting stock or more than 50% of all equity
interests is owned directly or indirectly by one or more Guarantors,
Borrowers and/or by one or more of any Guarantor's Subsidiaries or any
Borrower's Subsidiaries. With respect to any specified Guarantor or
Borrower, the "Subsidiaries" of such Guarantor or Borrower shall mean (y)
any Subsidiary owned directly or indirectly by such Guarantor or Borrower
or by any of its Subsidiaries, or (z) any trust with respect to which such
Guarantor or such Borrower or any of its Subsidiaries has a beneficial
interest.
"Swap Agreement" means one or more agreements between any Borrower and
any Lender, on terms similar in all material respects to the ABH 12-JPM
Swap Agreement and mutually acceptable to such Borrower and such Lender,
which agreements create Rate Hedging Obligations.
"Taxes" means taxes, levies, imposts, duties, charges, fees,
deductions or withholdings imposed, levied, collected, withheld or assessed
by any Governmental Authority.
"Term Out Period" means the period from but excluding the Stated
Termination Date through and including the first anniversary of the Stated
Termination Date.
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"Termination Event" means: (i) a "Reportable Event"; or (ii) the
termination of a Single Employer Plan or the filing of a notice of intent
to terminate a Single Employer Plan; or (iii) the institution of
proceedings to terminate a Single Employer Plan by the PBGC; or (iv) the
partial or complete withdrawal of any Borrower or any ERISA Affiliate from
a Multiemployer Plan; or (v) the imposition of a Lien pursuant to Section
412 of the Code or Section 302 of ERISA in favor of the PBGC or a Employee
Benefit Plan; or (vi) any event or condition which results in the
Reorganization or Insolvency of a Multiemployer Plan; or (vii) any event or
condition which results in the termination of a Multiemployer Plan under
Section 4041A of ERISA or the institution by the PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA.
"Total Revolving Credit Commitment" means a principal amount equal to
$600,000,000, as may be reduced from time to time in accordance with
Section 2.7.
"Trust Agreement" means each of the Trust Agreements between a
Beneficial Owner and a Qualified Trustee.
"Trust Estate" means all estate, right, title and interest of each
Trustee in and to each Aircraft, each lease and all related documents and
all other property of the Trustee, including, without limitation, all
amounts of rent, insurance proceeds (other than liability insurance
proceeds payable to or for the benefit of any Borrower, any Beneficial
Owner, any Lender or the Agent) and requisition, indemnity or other
payments or any kind for or with respect to each Aircraft.
"Trustee" means a Qualified Trustee, solely in its capacity as trustee
under a Trust Agreement.
"Type" means any type of Loan (i.e., a Base Rate Loan or a Eurodollar
Rate Loan).
"Unleaseable" with respect to a Financed Aircraft means (a) such
Financed Aircraft shall not be subject to an Eligible Lease for 120
consecutive days (excluding the number of days such Aircraft shall be
undergoing (i) maintenance or repairs in accordance with the provisions of
the Loan Documents, (ii) Approved Improvements or (iii) a Qualified
Conversion) and (b) after such 120 day period the Agent shall have
reasonably determined that the Servicer will be unable to lease such
Financed Aircraft within 120 days after the date of determination.
"Voting Stock" means shares of capital stock issued by a corporation,
or equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening of
such a contingency.
1.2. Rules of Interpretation.
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(a) All accounting terms not specifically defined herein shall have
the meanings assigned to such terms and shall be interpreted in accordance
with GAAP applied on a Consistent Basis.
(b) Code shall have the meaning given therein unless otherwise defined
herein, except to the extent that the Uniform Commercial Code of another
jurisdiction is controlling, in which case such terms shall have the
meaning given in the Uniform Commercial Code of the applicable
jurisdiction.
(c) The headings, subheadings and table of contents used herein or in
any other Loan Document are solely for convenience of reference and shall
not constitute a part of any such document or affect the meaning,
construction or effect of any provision thereof.
(d) Except as otherwise expressly provided, references herein to
articles, sections, paragraphs, clauses, annexes, appendices, exhibits and
schedules are references to articles, sections, paragraphs, clauses,
annexes, appendices, exhibits and schedules in or to this Agreement.
(e) All definitions set forth herein or in any other Loan Document
shall apply to the singular as well as the plural form of such defined
term, and all references to the masculine gender shall include reference to
the feminine or neuter gender, and vice versa, as the context may require.
(f) When used herein or in any other Loan Document, words such as
"hereunder", "hereto", "hereof" and "herein" and other words of like import
shall, unless the context clearly indicates to the contrary, refer to the
whole of the applicable document and not to any particular article,
section, subsection, paragraph or clause thereof.
(g) References to "including" means including without limiting the
generality of any description preceding such term, and for purposes hereof
the rule of ejusdem generis shall not be applicable to limit a general
statement, followed by or referable to an enumeration of specific matters,
to matters similar to those specifically mentioned.
(h) All dates and times of day specified herein shall refer to such
dates and times in New York, New York.
(i) Each of the parties to the Loan Documents and their counsel have
reviewed and revised, or requested (or had the opportunity to request)
revisions to, the Loan Documents, and any rule of construction that
ambiguities are to be resolved against the drafting party shall be
inapplicable in the construing and interpretation of the Loan Documents and
all exhibits, schedules and appendices thereto.
(j) Any reference to an officer of any Borrower or any other Person by
reference to the title of such officer shall be deemed to refer to each
other officer of such Person, however titled, exercising the same or
substantially similar functions.
(k) All references to any agreement or document as amended, modified
or supplemented, or words of similar effect, shall mean such document or
agreement, as the
24
case may be, as amended, modified or supplemented from time to time only as
and to the extent permitted therein and in the Loan Documents.
ARTICLE II
THE REVOLVING CREDIT FACILITY
2.1. Revolving Loans.
(a) Commitment. Subject to the terms and conditions of this Agreement,
each Lender severally agrees to make Loans to any of the Borrowers under
the Revolving Credit Facility from time to time from the Closing Date until
the Revolving Credit Termination Date on a pro rata basis as to the total
borrowing requested by the applicable Borrower on any day determined by
such Lender's Applicable Commitment Percentage up to but not exceeding the
Revolving Credit Commitment of such Lender, provided, however, that (A) the
proceeds of such Loan shall be used by such Borrower to (i) finance or
refinance, or reimburse a Borrower for, the Purchase Price of an Eligible
Aircraft (including additional loans to a Borrower (x) in connection with
an increase in the Applicable Aircraft Advance Rate as provided in the
definition thereof or (y) in connection with the acquisition of additional
Eligible Aircraft, provided that such Aircraft is not subject to a Lease)
or (ii) reimburse a Borrower for required upfront maintenance, a Qualified
Conversion and any Approved Improvements, and (B) the amount of such Loan
(together with any other Loans relating to such Aircraft or additional
Loans pursuant to clause (A)(y) above) shall not exceed the Applicable
Aircraft Borrowing Base of such Aircraft; and provided, further, that the
Lenders will not be required and shall have no obligation to make any such
Loan (i) so long as a Default or an Event of Default has occurred and is
continuing or (ii) if the Agent has accelerated the maturity of any of the
Loans as a result of an Event of Default; and provided, further, that
immediately after giving effect to each such Loan, the amount of Revolving
Credit Outstandings shall not exceed the lesser of the Borrowing Base or
the Total Revolving Credit Commitment. Within such limits, the Borrowers
may borrow, repay and reborrow under the Revolving Credit Facility on a
Business Day from the Closing Date until, but (as to borrowings and
reborrowings) not including, the Revolving Credit Termination Date;
provided, however, that (1) no Revolving Loan that is a Eurodollar Rate
Loan shall be made which has an Interest Period that extends beyond the
first anniversary of the Stated Termination Date and (2) each Revolving
Loan that is a Eurodollar Rate Loan may, subject to the provisions of
Section 2.7, be repaid only on the last day of the Interest Period with
respect thereto unless such payment is accompanied by the additional
payment, if any, required by Section 4.5. For the avoidance of doubt, if
the Applicable Aircraft Advance Rate in respect of an Eligible Aircraft
shall increase after a Loan is made in respect of such Eligible Aircraft,
then the Applicable Borrower shall be permitted to borrow additional Loans
in the manner provided above so long as the aggregate Loans in respect of
such Eligible Aircraft shall not exceed the Applicable Aircraft Borrowing
Base of such Eligible Aircraft.
(b) Amounts. Each Revolving Loan hereunder and each Conversion under
Section 2.8, shall be in an amount of at least $500,000 (other than
Revolving Loans made
25
in connection with (i) an increase in the Applicable Aircraft Advance Rate
as provided in the definition thereof, (ii) an Approved Improvement or
(iii) a Qualified Conversions).
(c) Procedures. An Authorized Representative shall give the Agent (i)
at least three (3) Business Days' irrevocable written notice of an Interest
Rate Selection Notice with appropriate insertions, effective upon receipt,
of each Revolving Loan that is to be Converted into a Eurodollar Rate Loan
prior to 10:30 A.M. and (ii) at least one (1) Business Day's written
notice, revocable only on or before noon the following Business Day of a
Borrowing Notice with appropriate insertions, effective upon receipt, of
each Revolving Loan (which shall be borrowed as a Base Rate Loan) prior to
10:30 A.M. and (iii) at least one (1) Business Day's irrevocable written
notice of an Interest Rate Selection Notice with appropriate insertions,
effective upon receipt, of each Revolving Loan that is to be Converted into
a Base Rate Loan prior to 10:30 A.M. Each such notice shall (A) specify the
name of the respective Borrower, the amount of the borrowing, the date of
borrowing or Conversion (as applicable), type of Revolving Loan (Base Rate
or Eurodollar Rate), the date of borrowing and, if a Eurodollar Rate Loan,
the Interest Period to be used in the computation of interest and (B)
identify the Financed Aircraft the acquisition of which is to be financed
with the proceeds of the borrowing. Notice of receipt of such Borrowing
Notice or Interest Rate Selection Notice, as the case may be, together with
the amount of each Lender's portion of a Loan requested thereunder, shall
be provided by the Agent to each Lender by facsimile transmission with
reasonable promptness, but (provided the Agent shall have received such
notice by 10:30 A.M.) not later than 1:00 P.M. on the same day as the
Agent's receipt of such notice.
(i) Promptly (and, to the extent feasible, not later than 2:00
P.M.) on the date specified for each borrowing under this Section 2.1,
each Lender shall, pursuant to the terms and subject to the conditions
of this Agreement, make the amount of the Loan or Loans to be made by
it on such day available by wire transfer to the Agent in the amount
of its pro rata share, determined according to such Lender's
Applicable Commitment Percentage of the Revolving Loan or Revolving
Loans to be made on such day. Such wire transfer shall be directed to
the Agent at the Principal Office and shall be in the form of Dollars
constituting immediately available funds. The amount so received by
the Agent shall, subject to the terms and conditions of this
Agreement, be made available to the Applicable Borrower by delivery of
the proceeds thereof to the Borrowers' Account or otherwise as shall
be directed in the applicable Borrowing Notice by an Authorized
Representative and reasonably acceptable to the Agent.
(ii) Each Loan will be made initially as a Base Rate Loan. The
Borrowers shall have the option to elect the duration of the initial
and any subsequent Interest Periods and to Convert the Revolving Loans
in accordance with Section 2.8. Eurodollar Rate Loans and Base Rate
Loans may be outstanding at the same time, provided, however, there
shall not be outstanding at any one time Eurodollar Rate Loans for any
or any Borrower having more than two (2) different Interest Periods.
If the Agent does not receive an Interest Rate Selection Notice giving
notice of election of the duration of an Interest Period by the time
prescribed by Section 2.8, the applicable Borrower shall be deemed to
26
have elected for any Eurodollar Loan an Interest Period of the
duration provided in clause (x) of the definition of Interest Period.
2.2. Payment of Interest.
(a) The Borrowers, jointly and severally, shall pay interest to the
Agent for the account of each Lender on the outstanding and unpaid
principal amount of each Loan made by such Lender for the period commencing
on the date of such Loan until such Loan shall be due at the then
applicable Base Rate for Base Rate Loans or applicable Eurodollar Rate for
Eurodollar Rate Loans, as designated by the Authorized Representative
pursuant to Section 2.1; provided, however, that if any Event of Default
shall occur and be continuing, all amounts outstanding hereunder shall bear
interest during such period at the Default Rate.
(b) Interest on each Loan shall be computed on the basis of a year of
360 days and calculated in each case for the actual number of days elapsed.
Interest on each Loan shall be paid (x) monthly in arrears on the fifteenth
(15th) calendar day of each calendar month (or, if such day is not a
Business Day, on the next succeeding Business Day), (y) upon payment or
prepayment of the principal amount of any Loan or any portion thereof, on
the amount so paid or prepaid and (z) at the Revolving Credit Termination
Date.
2.3. Payment of Principal.
(a) Scheduled Repayments; Voluntary Prepayments. The principal amount
of each Revolving Loan shall be due and payable to the Agent for the
benefit of each Lender in full on the first anniversary of the Stated
Termination Date, or earlier as specifically provided herein. The Borrower
may prepay the outstanding principal amount of any Loan, in whole or in
part, upon one Business Day's notice to the Lender. All such prepayments
must be accompanied by accrued interest up to, and including, the date of
such prepayment and any compensation due under Section 4.5 hereof.
(b) Mandatory Prepayments.
(i) Upon the sale of any Aircraft or other asset by any Borrower,
or upon the refinancing of any Indebtedness of any Borrower arising
from any Loan hereunder, the Borrowers, jointly and severally, shall
immediately pay to the Agent an amount equal to the net proceeds of
such sale or refinancing, which amount shall be applied by the Agent
to reduce outstanding principal and accrued interest on any Loans made
to, or for the benefit of, such Borrower. If any net proceeds of such
sale or refinancing remain after the repayment in full of all
outstanding principal and accrued interest on such Loans, if no
Default or Event of Default exists at the time, such excess proceeds
shall be paid to the Applicable Borrower and may be used by such
Borrower subject to compliance with the terms of this Agreement and
the other Loan Documents.
(ii) The Borrowers, jointly and severally, shall be required to
prepay the Loans, upon five Business Days' prior notice, in an amount
equal to any amount by which the aggregate outstanding principal
amount of the Loans
27
exceeds the Borrowing Base. Alternatively, a Borrower may pledge
additional Collateral (valued in a manner reasonably acceptable to the
Agent) to increase the Borrowing Base and avoid such mandatory
prepayment.
(iii) The Borrowers, jointly and severally, shall be required to
prepay the Loan relating to a Financed Aircraft, upon five Business
Days' prior notice, in an amount equal to the product of (x) any
amount by which the estimated out-of-pocket costs incurred by the
Applicable Borrower in acquiring such Financed Aircraft that were
included in the Purchase Price exceed the actual amount of such
expenses and (y) the Applicable Aircraft Advance Rate.
(iv) The Borrowers, jointly and severally, shall be required to
prepay the Loans in respect of a Financed Aircraft upon the occurrence
of an Event of Loss in respect of such Finance Aircraft and on the
date required by Section 3.8(b) of the Security Agreement. If any net
proceeds received in respect of such Event of Loss remain after the
repayment in full of all outstanding principal and accrued interest on
such Loans, if no Default or Event of Default exists at the time, such
excess proceeds shall be paid to the Applicable Borrower and may be
used by such Borrower in its discretion.
(v) The Borrowers, jointly and severally, shall be required to
prepay the Loans in the amount distributed for that purpose under
Section 5.1 of the Lockbox Agreement.
(vi) Upon any Permanent Capital Markets Financing, the Borrowers,
jointly and severally, shall be required to prepay the Loans with
respect to any Aircraft included in such Permanent Capital Markets
Financing and if such Permanent Capital Markets Financing is competed
on or after the Stated Termination Date and the net proceeds thereof
are insufficient to prepay the Loans in full, either (a) the Borrowers
shall pledge their interest in the trust relating to such Permanent
Capital Markets Financing or (b) Holding shall continue to pledge its
right, title and interest in and to the Borrowers, to secure for the
Loans that thereafter remain outstanding until such Loans shall have
been paid in full.
2.4. Manner of Payment. Each payment of principal (including any
prepayment) and payment of interest and fees, and any other amount required to
be paid to the Lenders with respect to the Loans, shall be made to the Agent at
the Principal Office, for the account of each Lender, in Dollars and in
immediately available funds without setoff, deduction or counterclaim before
12:30 P.M. on the date such payment is due.
(a) The Agent shall deem any payment made by or on behalf of any
Borrower hereunder that is not made both in Dollars and in immediately
available funds and prior to 12:30 P.M. to be a non-conforming payment. Any
such payment shall not be deemed to be received by the Agent until the time
such funds become available funds. Any non-conforming payment may
constitute or become a Default or Event of Default. Interest shall continue
to accrue on any principal as to which a non-conforming payment is made
28
until the later of (x) the date such funds become available funds or (y)
the next Business Day at the Default Rate from the date such amount was due
and payable.
(b) In the event that any payment hereunder becomes due and payable on
a day other than a Business Day, then such due date shall be extended to
the next succeeding Business Day unless provided otherwise under clause
(ii) of the definition of "Interest Period"; provided that interest shall
continue to accrue during the period of any such extension and provided,
further, that in no event shall any such due date be extended beyond the
Revolving Credit Termination Date.
(c) Any payment or prepayment of any principal or interest on any Loan
hereunder shall be accompanied by a certificate signed by an Authorized
Representative and delivered to the Agent, which certificate shall identify
such Loan, the amount of principal and interest paid thereon, and the
Borrower to whom, or for whose benefit, such Loan was originally advanced.
2.5. Notes. At the request of any Lender, Revolving Loans made by such
Lender shall be evidenced by a Note payable to the order of such Lender in the
respective amount of its Applicable Commitment Percentage of the Revolving
Credit Commitment and shall be duly completed, executed and delivered by the
Borrowers.
2.6. Pro Rata Payments. Except as otherwise provided herein, (a) each
payment on account of the principal of and interest on the Loans and the fees
described in Section 2.10 shall be made to the Agent for the account of the
Lenders pro rata based on their Applicable Commitment Percentages, (b) all
payments to be made by any Borrower for the account of each of the Lenders on
account of principal, interest and fees, shall be made without diminution,
setoff, recoupment or counterclaim, and (c) the Agent will promptly distribute
to the Lenders in immediately available funds payments received in fully
collected, immediately available funds from any Borrower.
2.7. Reductions. The Borrowers shall, by notice from an Authorized
Representative, have the right from time to time but not more frequently than
once each calendar month, upon not less than three (3) Business Days' written
notice to the Agent, effective upon receipt, to reduce the Total Revolving
Credit Commitment. The Agent shall give each Lender, within one (1) Business Day
of receipt of such notice, facsimile notice, or telephonic notice (confirmed in
writing), of such reduction. Each such reduction shall be in the aggregate
amount of $5,000,000 or such greater amount which is in an integral multiple of
$1,000,000, or the entire remaining Total Revolving Credit Commitment, and shall
permanently reduce the Total Revolving Credit Commitment. Each reduction of the
Total Revolving Credit Commitment shall be accompanied by payment of the
Revolving Loans to the extent that the principal amount of Revolving Credit
Outstandings exceeds the Total Revolving Credit Commitment after giving effect
to such reduction, together with accrued and unpaid interest on the amounts
prepaid. No such reduction shall result in the payment of any Eurodollar Rate
Loan other than on the last day of the Interest Period of such Eurodollar Rate
Loan unless such prepayment is accompanied by amounts due, if any, under Section
4.5.
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2.8. Conversions and Elections of Subsequent Interest Periods. Subject
to the limitations set forth below and in Article IV, the Borrowers may:
(a) upon delivery, effective upon receipt, of a properly completed
Interest Rate Selection Notice to the Agent on or before 10:30 A.M. on any
Business Day, Convert all or a part of Eurodollar Rate Loans to Base Rate
Loans on the last day of the Interest Period for such Eurodollar Rate
Loans; and
(b) provided that no Default or Event of Default shall have occurred
and be continuing and upon delivery, effective upon receipt, of a properly
completed Interest Rate Selection Notice to the Agent on or before 10:30
A.M. three (3) Business Days' prior to the date of such election or
Conversion:
(i) elect a subsequent Interest Period for all or a portion of
Eurodollar Rate Loans to begin on the last day of the then current
Interest Period for such Eurodollar Rate Loans; and
(ii) Convert Base Rate Loans to Eurodollar Rate Loans on any
Business Day.
Each election and Conversion pursuant to this Section 2.8 shall be
subject to the limitations on Eurodollar Rate Loans set forth in the definition
of "Interest Period" herein and in Sections 2.1, 2.3 and Article IV. The Agent
shall give written notice to each Lender of such notice of election or
Conversion prior to 3:00 P.M. on the day such notice of election or Conversion
is received. All such Continuations or Conversions of Loans shall be effected
pro rata based on the Applicable Commitment Percentages of the Lenders.
2.9. Increase and Decrease in Amounts. The amount of the Total
Revolving Credit Commitment that shall be available to the Borrowers as Loans
shall be reduced by the aggregate amount of Revolving Credit Outstandings.
2.10. Fees. Borrower shall pay (i) the fees specified in the Fee
Letter on the dates specified therein and (ii) a commitment fee for the period
from and including the date hereof to the Revolving Credit Termination Date,
computed at a rate of 0.25% per annum on the average daily amount of the
available Revolving Credit Commitment of such Lender during the period for which
payment is made, payable monthly in arrears on each Fee Payment Date, commencing
on the first such date to occur after the date hereof.
2.11. Deficiency Advances. No Lender shall be responsible for any
default of any other Lender in respect to such other Lender's obligation to make
any Loan hereunder nor shall the Revolving Credit Commitment of any Lender
hereunder be increased as a result of such default of any other Lender. Without
limiting the generality of the foregoing, in the event any Lender shall fail to
advance funds to any Borrower as herein provided, the Agent may in its
discretion and in its capacity as a Lender, but shall not be obligated to,
advance all or any portion of such amount or amounts (each, a "deficiency
advance") and shall thereafter be entitled to payments of principal of and
interest on such deficiency advance in the same manner and at the same interest
rate or rates as if it had originally made such Loan; provided that, (i) such
defaulting Lender shall not be entitled to receive payments of principal,
interest or fees with
30
respect to such deficiency advance until such deficiency advance shall be paid
by such Lender and (ii) upon payment to the Agent from such other Lender of the
entire outstanding amount of each such deficiency advance, together with accrued
and unpaid interest thereon, from the most recent date or dates interest was
paid to the Agent by a Borrower on each Loan comprising the deficiency advance
at the interest rate per annum for overnight borrowing by the Agent from the
Federal Reserve Bank, then such payment shall be to the Agent as a Lender in
full payment of such deficiency advance and such Borrower shall be deemed to
have borrowed the amount of such deficiency advance from such other Lender as of
the most recent date or dates, as the case may be, upon which any payments of
interest were made by such Borrower thereon.
2.12. Use of Proceeds. The proceeds of each Loan made pursuant to the
Revolving Credit Facility hereunder shall be used by the Applicable Borrower to
finance or refinance, or reimburse a Borrower for the Purchase Price of an
Eligible Aircraft and costs incurred in connection with any Approved
Improvements or any Qualified Conversion.
2.13. Designation of Borrowing Affiliate; Releases.
(a) An Authorized Representative may from time to time designate any
Holdings Subsidiary Trust or Holdings SPC which has not joined in the
execution of this Agreement as a "Borrowing Affiliate" hereunder by causing
such Holdings Subsidiary Trust or Holdings SPC to execute and deliver a
duly completed Assumption Letter (in the form attached hereto as Exhibit Q)
to the Agent with the written acknowledgment of the Borrowers and the Agent
at the foot thereof, together with (a) Facility Guaranties executed by each
Beneficial Owner of any such Holdings Subsidiary Trust, by each Subsidiary
of any such Beneficial Owner (other than such Holdings Subsidiary Trust),
by each Subsidiary of such Holdings Subsidiary Trust or of such Holdings
SPC and by the Applicable Intermediary (if any), (b) Security Agreements
signed by such Holdings Subsidiary Trust or Holdings SPC, by each
Beneficial Owner of any such Holdings Subsidiary Trust, by each Subsidiary
of any such Beneficial Owner, by each Subsidiary of such Holdings
Subsidiary Trust or Holdings SPC and by the Applicable Intermediary (if
any), (c) Pledge Agreements signed by the respective Beneficial Owners and
other owners, granting a security interest in the Pledged Interests in such
Holdings Subsidiary Trust or Holdings SPC in any Subsidiary thereof, in any
Beneficial Owner and in any Subsidiary thereof, and in the Applicable
Intermediary (if any), and (d) all additional documents required under such
Assumption Letter. Upon such execution, delivery and consent, such Holdings
Subsidiary Trust or Holdings SPC (as the case may be) shall for all
purposes be a party hereto as a Borrower as fully as if it had executed and
delivered this Agreement.
(b) So long as (w) all Loans made to or on behalf of any Borrower,
together with all accrued interest on such Loans, have been paid in full,
(x) all other outstanding Obligations of such Borrower (except Obligations
to pay principal and interest on Loans other than those Loans described in
clause (w)) have been paid in full, (y) no Default or Event of Default has
occurred and will be continuing after giving effect to such termination,
and (z) any prepayment required under Section 2.3(b) has been made, then
such Borrower may, by not less than three (3) days prior notice to the
Agent (which shall promptly notify the Lenders thereof), (i) terminate its
status as a "Borrowing Affiliate"
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and "Borrower" hereunder and under the other Loan Documents, and (ii) (with
respect to any Beneficial Owner of such Borrower) unless such Person also
holds a beneficial interest in any other Borrower, terminate the status of
such Person and any other Subsidiary of such Person as a "Guarantor"
hereunder and under the other Loan Documents, and (iii) terminate the
status of the Applicable Intermediary (if any) and any other Subsidiary of
such Borrower as a "Guarantor" hereunder and under the other Loan
Documents. Upon such terminations (provided the conditions to such
terminations are satisfied), the Agent shall take all actions reasonably
requested by such Borrower (A) to release the Liens of the Agent on all
Collateral owned by such Borrower and its Subsidiaries (including the
Applicable Intermediary, if any) and to release such Borrower and such
Subsidiaries from all of their respective obligations under the Loan
Documents (including without limitation a written release to such effect),
(B) unless such Beneficial Owner also holds a beneficial interest in any
other Borrower, to release the Liens of the Agent on all Collateral owned
by such Beneficial Owner and its other Subsidiaries and to release such
Beneficial Owner and such other Subsidiaries from all of their respective
obligations under the Loan Documents (including without limitation a
written release to such effect), (C) to release the Lien of the Agent with
respect to any Pledged Interests in such Borrower, its Subsidiaries and the
Applicable Intermediary, and (D) (unless such Beneficial Owner also holds a
beneficial interest in any other Borrower) to release the Lien of the Agent
with respect to any Pledged Interests in such Beneficial Owner. Any
provision of this Section 2.13 or any other provision of any Loan Document
notwithstanding, in no event shall Holdings or Irish Holdings be released
from its obligations to pay indemnification to, or reimburse any costs or
expenses of, the Agent or any Lender (including without limitation the
obligations under Article IV and Sections 4.6, 7.15, 11.5 and 11.9), which
agreements and obligations shall survive any release or termination of any
Credit Party (other than Holdings or Irish Holdings) pursuant to this
Section 2.12.
(c) So long as (x) all obligations of ABH 12 under the ABH 12-JPM Swap
Agreement have been paid in full, (y) no Default or Event of Default has
occurred and will be continuing after giving effect to such termination,
and (z) any prepayment of interest on the Loans and other Obligations
required under the ABH 12-JPM Swap Agreement to be made from the proceeds
of such ABH 12-JPM Swap Agreement has been made, then ABH 12 may, by not
less than three (3) days prior notice to the Agent (which shall promptly
notify the Lenders thereof), unless ABH 12 holds a beneficial interest in
any Borrower, terminate its status as a "Guarantor" hereunder and under the
other Loan Documents. Upon such termination (provided the conditions to
such terminations are satisfied), unless ABH 12 becomes a party to this
Agreement as a "Borrower" or a "Borrowing Affiliate" or holds beneficial
interest in any Borrower, the Agent shall take all actions reasonably
requested by ABH 12 to release the Liens of the Agent on all Collateral
owned by ABH 12 and to release ABH 12 from all of its obligations under the
Loan Documents (including without limitation a written release to such
effect).
2.14. Joint and Several Liability. Each Borrower (including without
limitation each Borrowing Affiliate) agrees and acknowledges that the
Obligations (subject to the proviso in the last sentence in the definition of
"Obligations" as such term is defined in Section 1.1
32
herein) constitute and will constitute joint and several obligations and
liabilities of the Borrowers; provided, however, that anything herein or in any
other Loan Document to the contrary notwithstanding, the maximum liability of
each Borrower with respect to the joint and several liability under this Section
2.14 shall in no event exceed the amount which can be guaranteed by such
Borrower under applicable federal, state and applicable foreign laws relating to
the insolvency of debtors. Each Borrower further agrees and acknowledges that
all actions taken, elections made and notices and certificates furnished or
received by it under or pursuant to the Loan Documents shall constitute the
action, election, notice or certification of all of the Borrowers under the Loan
Documents, and that each Authorized Representative shall have full authority to
act for and on behalf of all of the Borrowers for all purposes of the Loan
Documents. Each Borrower agrees that the joint and several liability of the
Borrowers shall not be impaired or affected by any modification, supplement,
extension or amendment of any contract or agreement to which the parties thereto
may hereafter agree, nor by any modification, release or other alteration of any
of the rights of the Agent or any Lender with respect to the Collateral other
than as provided in Section 2.13(b) hereof, nor by any delay, extension of time,
renewal, compromise or other indulgence granted by the Agent, any Lender or any
other Person with respect to any of the Obligations, nor by any other agreements
or arrangements whatever with any other Borrower or with anyone else, each
Borrower hereby waiving all notice of any such delay, extension, release,
substitution, renewal, compromise or any such delay, extension, release,
substitution, renewal, compromise or other indulgence, and hereby consenting to
be bound thereby as fully and effectually as if it had expressly agreed thereto
in advance. The liability of each Borrower hereunder is direct and unconditional
as to all of the Obligations hereunder, and may be enforced without requiring
the Agent, any Lender or any other Person first to resort to any other right,
remedy or security; no Borrower shall have any right of subrogation,
reimbursement or indemnity whatsoever, nor any right of recourse to security for
indemnity whatsoever, nor any right of recourse to security for any of the
Obligations hereunder, unless and until all of said Obligations have been paid
in full; except as provided in Section 2.13(b) hereof and subject to the proviso
to the first sentence of this Section 2.14, nothing shall discharge or satisfy
the liability of any Borrower hereunder except the full payment and performance
of all of the Obligations; any and all present and future debts and obligations
of each Borrower to the other Borrowers are hereby waived and postponed in favor
of and subordinated to the full payment and performance of all present and
future Obligations of the Borrowers to the Agent, the Lenders and any other
Person.
2.15. Eligible Lease Involving Eligible Intermediary. In lieu of
leasing a Financed Aircraft directly to an Eligible Carrier, a Borrower may
lease such Financed Aircraft directly to an Eligible Intermediary pursuant to an
Eligible Lease described in clause (X) of the proviso to the definition of
"Eligible Lease"; provided that
(a) such Eligible Intermediary simultaneously subleases such Aircraft
to an Eligible Carrier pursuant to an Eligible Lease described in clause
(Y) of the proviso to the definition of "Eligible Lease" and such sublease
is pledged as collateral security for the obligations of the Eligible
Intermediary under the head lease;
(b) in the case of any Loan with respect to such Aircraft, all Loan
conditions that pertain to any Eligible Lease or other Lease by a Borrower
of such Aircraft (including without limitation requirements concerning the
perfection of Liens on Collateral, and
33
delivery of copies of the Leases and Lessee Notices) shall be satisfied
with respect to each such Lease to or by the Applicable Intermediary;
(c) all provisions of any Loan Document that pertain to any Eligible
Lease or other Lease by a Borrower of such Aircraft shall apply to each
such Lease to or by the Applicable Intermediary; and
(d) the lease/sublease structure shall not result in adverse tax or
other consequences to the Agent or any Lender which have not been
indemnified or otherwise addressed to the reasonable satisfaction of the
Agent.
ARTICLE III
SECURITY
3.1. Security. As security for the full and timely payment and
performance of all Obligations, the Credit Parties shall on or before the date
of the initial Loan do or cause to be done all things necessary in the
reasonable opinion of the Agent and its counsel to grant to the Agent for the
benefit of the Lenders a duly perfected first priority security interest under
all applicable laws in all Collateral subject to no prior Lien or other
encumbrance (that, in each case, has not previously been satisfied in full) or
restriction on transfer (other than Permitted Liens).
3.2. Further Assurances. At the request of the Agent, each Borrower
will, or will cause other Credit Parties (as the case may be), to, execute, by
its duly authorized officers, alone or with the Agent, any certificate,
instrument, statement or document, or to procure any such certificate,
instrument, statement or document, or to take such other action (and pay all
connected costs) which the Agent reasonably deems necessary from time to time to
create, continue or preserve the liens and security interests in Collateral (and
the perfection and priority thereof) of the Agent contemplated hereby and by the
other Loan Documents and specifically including all Collateral acquired by any
Borrower or any Guarantor or any other Credit Party after the Closing Date.
3.3. Information Regarding Collateral. ABH 12 and each Borrower
represents, warrants and covenants that (i) the chief executive office of each
Borrower and each other Person (including ABH 12) providing Collateral pursuant
to a Security Instrument (each, a "Grantor") at the Closing Date is located at
the address or addresses specified on Schedule 3.3, and (ii) Schedule 3.3
contains a true and complete list of (a) the name and address of each Grantor,
(b) each location of the chief executive office and principal place of business
of each Grantor and (c) the country of registration (if applicable) of each
Aircraft. Neither ABH 12, nor any Borrower shall change, or permit any other
Grantor to change, the location of its chief executive office or principal place
of business, or use or permit any other Grantor to use, any additional trade
style, except upon giving not less than thirty (30) days' prior written notice
to the Agent and taking or causing to be taken all such action at the Borrowers'
or such other Grantor's expense as may be reasonably requested by the Agent to
perfect or maintain the perfection of the Lien of the Agent in Collateral.
34
3.4. Quiet Enjoyment. The Agent and each Lender hereby agree that, so
long as no Lease Event of Default shall have occurred and be continuing under an
Eligible Lease, it will not interfere with the quiet enjoyment of the possession
and use of the Aircraft by the Applicable Carrier during the term of such
Eligible Lease and it will (subject to any requirements or restrictions imposed
by applicable law) dispose of its interest in the Eligible Aircraft leased under
such Eligible Lease expressly subject to such Eligible Lease and on terms such
that the purchaser provides a similar right of quiet enjoyment to such
Applicable Carrier. Upon the request of any Borrower, the Agent (on behalf of
itself and the Lenders) will confirm the immediately preceding sentence in
writing to any Applicable Carrier.
ARTICLE IV
CHANGE IN CIRCUMSTANCES
4.1. Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof or compliance by any Lender with
any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority made subsequent to the date
hereof:
(i) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held
by, deposits or other liabilities in or for the account of, advances,
loans or other extensions of credit by, or any other acquisition of
funds by, any office of such Lender that is not otherwise included in
the determination of the Eurodollar Rate; or
(ii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost (other than a
Tax) to such Lender, by an amount that such Lender deems to be material, of
making, converting into, continuing or maintaining Eurodollar Rate Loans or to
reduce any amount receivable hereunder in respect thereof (other than by reason
of any Tax), then, in any such case, the Borrowers shall promptly pay such
Lender, upon its demand, any additional amounts necessary to compensate such
Lender for such increased cost or reduced amount receivable. If any Lender
becomes entitled to claim any additional amounts pursuant to this paragraph, it
shall promptly notify the Borrowers (with a copy to the Agent) of the event by
reason of which it has become so entitled.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the
effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder to a
level below that which such Lender or such corporation could have achieved
but for such adoption, change or compliance (taking into consideration such
Lender's or such corporation's policies with respect to capital
35
adequacy) by an amount deemed by such Lender to be material, then from time
to time, after submission by such Lender to the Borrowers (with a copy to
the Agent) of a written request therefor, the Borrowers shall pay to such
Lender such additional amount or amounts as will compensate such Lender or
such corporation for such reduction.
(c) Each Lender shall promptly notify Holdings, Irish Holdings, the
Borrowers and the Agent of any event of which it has knowledge occurring
after the date hereof, which will entitle a Lender to compensation pursuant
to this Section 4.1, and such Lender shall, upon written request by
Holdings, Irish Holdings or any Borrower, designate a different Applicable
Lending Office if such designation will avoid the need for, or reduce the
amount of, such compensation and will not, in the judgment of such Lender,
be otherwise disadvantageous to it. A certificate as to any additional
amounts payable pursuant to this Section submitted by any Lender to the
Borrowers (with a copy to the Agent) shall be conclusive in the absence of
manifest error. Notwithstanding anything to the contrary in this Section,
the Borrowers shall not be required to compensate a Lender pursuant to this
Section for any amounts incurred more than three months prior to the date
that such Lender notifies the Borrowers of such Lender's intention to claim
compensation therefor; provided that, if the circumstances giving rise to
such claim have a retroactive effect, then such three-month period shall be
extended to include the period of such retroactive effect. The obligations
of the Borrowers pursuant to this Section shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
4.2. Limitation on Types of Loans. If on or prior to the first day of
any Interest Period for any Eurodollar Rate Loan:
(a) the Agent determines (which determination shall be conclusive)
that by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for such
Interest Period; or
(b) the Required Lenders determine (which determination shall be
conclusive) and notify the Agent that the Eurodollar Rate will not
adequately and fairly reflect the cost to the Lenders of funding Eurodollar
Rate Loans for such Interest Period;
then the Agent shall give the Borrowers prompt notice thereof specifying the
relevant Type of Loans and the relevant amounts or periods, and so long as such
condition remains in effect, the Lenders shall be under no obligation to make
additional Loans of such Type, Continue Loans of such Type or to Convert Loans
of any other Type into Loans of such Type, and the Borrowers shall, jointly and
severally, on the last day(s) of the then current Interest Period(s) for the
outstanding Loans of the affected Type, either prepay such Loans or Convert such
Loans into Base Rate Loans in accordance with the terms of this Agreement.
4.3. Illegality. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Lender or its
Applicable Lending Office to make, maintain, or fund Eurodollar Rate Loans
hereunder, then such Lender shall promptly notify the Borrowers thereof and such
Lender's obligation to make or Continue Eurodollar Rate Loans and to Convert
other Types of Loans into Eurodollar Rate Loans shall be suspended until such
time
36
as such Lender may again make, maintain, and fund Eurodollar Rate Loans (in
which case the provisions of Section 4.4 shall be applicable).
4.4. Treatment of Affected Loans. If the obligation of any Lender to
make a Eurodollar Rate Loan or to Continue, or to Convert Loans of any other
Type into, Loans of a particular Type shall be suspended pursuant to Section 4.1
or 4.3 hereof (Loans of such Type being herein called "Affected Loans" and such
Type being herein called the "Affected Type"), such Lender's Affected Loans
shall be automatically Converted into Base Rate Loans on the last day(s) of the
then current Interest Period(s) for Affected Loans (or, in the case of a
Conversion required by Section 4.3 hereof, on such earlier date as such Lender
may specify to the Borrowers with a copy to the Agent) and, unless and until
such Lender gives notice as provided below that the circumstances specified in
Section 4.1 or 4.3 hereof that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Affected Loans have been so
Converted, all payments and prepayments of principal that would otherwise
be applied to such Lender's Affected Loans shall be applied instead to its
Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such Lender
as Loans of the Affected Type shall be made or Continued instead as Base
Rate Loans, and all Loans of such Lender that would otherwise be Converted
into Loans of the Affected Type shall be Converted instead into (or shall
remain as) Base Rate Loans.
If such Lender gives notice to the Borrowers (with a copy to the Agent) that the
circumstances specified in Section 4.1 or 4.3 hereof that gave rise to the
Conversion of such Lender's Affected Loans pursuant to this Section 4.4 no
longer exist (which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Loans of the Affected Type made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Loans of the Affected Type, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding Loans of the
Affected Type and by such Lender are held pro rata (as to principal amounts,
Types, and Interest Periods) in accordance with their respective Revolving
Credit Commitments.
4.5. Compensation. Upon the request of any Lender, Holdings, Irish
Holdings and the Borrowers, jointly and severally, shall pay to such Lender such
amount or amounts as shall be sufficient (in the reasonable opinion of such
Lender) to compensate it for any loss, cost, or expense incurred by it as a
result of:
(a) any payment, prepayment, or Conversion of a Eurodollar Rate Loan
for any reason (including, without limitation, the acceleration of the
Loans pursuant to Section 9.1) on a date other than the last day of the
Interest Period for such Loan; or
(b) any failure by any Borrower for any reason (including, without
limitation, the failure of any condition precedent specified in Article V
to be satisfied) to borrow, Convert, Continue, or prepay a Eurodollar Rate
Loan on the date for such borrowing,
37
Conversion, Continuation, or prepayment specified in the relevant notice of
borrowing, prepayment, Continuation, or Conversion under this Agreement.
4.6. Taxes.
(a) Any and all payments by any Borrower to or for the account of any
Lender or the Agent hereunder or under any other Loan Document shall be
made free and clear of and without deduction or withholding for any and all
Taxes, and all liabilities with respect thereto, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority,
excluding, in the case of each Lender and the Agent, Taxes imposed on its
income, receipts, capital, net worth or items of tax preference and
franchise, doing business and similar Taxes (imposed on it in lieu of net
income taxes), imposed on such Lender or Agent as a result of a present or
former connection between the Agent or such Lender and the jurisdiction of
the Governmental Authority imposing such tax or any political subdivision
or taxing authority thereof or therein (other than any such connection
arising solely from the Agent or such Lender having executed, delivered or
performed its obligations or received a payment under, or enforced, this
Agreement or any other Loan Document). If any such non-excluded Taxes ("
Indemnified Taxes") or Other Taxes are required to be withheld after the
date hereof from or in respect of any sum payable under this Agreement or
any other Loan Document to any Lender or the Agent, (i) the sum payable
shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable
under this Section 4.6) such Lender or the Agent receives an amount equal
to the sum it would have received had no such deductions been made, (ii)
such Borrower shall make such deductions, (iii) such Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority
in accordance with applicable law, and (iv) such Borrower shall furnish to
the Agent, at its address referred to in Section 11.2, the original or a
certified copy of a receipt evidencing payment thereof or other evidence of
payment reasonably acceptable to such Lender or the Agent; provided
however, that the Borrowers shall not be required to increase such amounts
payable to any Lender with respect to any Taxes (i) that are attributable
to such Lender's failure to comply with the requirements of paragraph (d)
or (e) of this Section or (ii) that are United States withholding taxes
imposed on amounts payable to such Lender at the time such Lender becomes a
party to this Agreement, except to the extent that such Lender's assignor
(if any) was entitled, at the time of assignment, to receive additional
amounts from the Borrowers with respect to such Taxes pursuant to this
paragraph.
(b) In addition, Holdings, Irish Holdings and the Borrowers agree,
jointly and severally, to pay any and all present or future stamp or
documentary taxes which arise from the execution or delivery of this
Agreement or any other Loan Document or the provision of the security
interest in any Collateral required hereunder (hereinafter referred to as
"Other Taxes").
(c) Holdings, Irish Holdings and the Borrowers agree, jointly and
severally, to indemnify each Lender and the Agent for the full amount of
Indemnified Taxes and Other Taxes (including, without limitation, any
Indemnified Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section 4.6) paid by such
38
Lender or the Agent (as the case may be) and any liability (including
penalties, interest, and expenses) arising therefrom or with respect
thereto.
(d) Each Lender, on or prior to the date of its execution and delivery
of this Agreement in the case of each Lender listed on the signature pages
hereof and on or prior to the date on which it becomes a Lender in the case
of each other Lender, and from time to time thereafter if requested in
writing by any Borrower or the Agent (unless such failure is due to a
change in treaty, law or regulation occurring subsequent to the date on
which a form originally was required to be provided), shall provide the
Borrowers and the Agent with (i) Internal Revenue Service Form X-0XXX,
X-0XXX or W-8IMY (including all required accompanying information), as
appropriate, or any successor form prescribed by the Internal Revenue
Service (including a United States taxpayer identification number),
certifying that such Lender is entitled to benefits under an income tax
treaty to which the United States is a party which reduces the rate of
withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States or (ii) Internal
Revenue Service Form W-9 or any successor form prescribed by the Internal
Revenue Service. In addition, each Lender and the Agent agrees that it will
(i) take all actions reasonably requested by Holdings, Irish Holdings or a
Borrower in writing that are consistent with applicable legal and
regulatory restrictions to claim any available reductions or exemptions
from Indemnified Taxes or Other Taxes and (ii) otherwise cooperate with
Holdings, Irish Holdings and the Borrowers to minimize any amounts payable
by Holdings, Irish Holdings or the Borrowers under this Section 4.6;
provided, however, that in each case, any out-of-pocket cost relating to
such action or cooperation requested by Holdings, Irish Holdings or a
Borrower shall be borne by Holdings, Irish Holdings or such Borrower and no
Lender shall be required to take any action that it determines in its sole
good faith discretion, may be adverse in any non de minimis respect to it
and not indemnified to its satisfaction.
(e) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which a
Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to such
Borrower (with a copy to the Agent), at the time or times prescribed by
applicable law or reasonably requested by such Borrower, such properly
completed and executed documentation prescribed by applicable law as will
permit such payments to be made without withholding or at a reduced rate,
provided that such Lender is legally entitled to complete, execute and
deliver such documentation and in such Lender's judgment such completion,
execution or submission would not materially prejudice the legal position
of such Lender.
(f) If Holdings, Irish Holdings or any Borrower is required to pay
additional amounts to or for the account of any Lender pursuant to this
Section 4.6, then such Lender will agree to use reasonable efforts to
change the jurisdiction of its Applicable Lending Office so as to eliminate
or reduce any such additional payment which may thereafter accrue if such
change, in the sole judgment of such Lender, is not otherwise
disadvantageous to such Lender.
39
(g) Within thirty (30) days after the date of any payment of Taxes,
Holdings, Irish Holdings or the applicable Borrower shall furnish to the
Agent the original or a certified copy of a receipt evidencing such payment
or otherwise evidence of such payment as is reasonably acceptable to the
Agent.
(h) If the Agent or any Lender receives a refund of any Taxes or Other
Taxes as to which it has been indemnified by a Borrower or with respect to
which a Borrower has paid additional amounts pursuant to this Section 4,6,
it shall pay over such refund to such Borrower (but only to the extent of
indemnity payments made, or additional amounts paid, by a Borrower under
this Section 4.6 with respect to the Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of the Agent or such Lender
and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
Borrower, upon the request of the Agent or such Lender, agrees to repay the
amount paid over to a Borrower (plus any penalties, interest or other
charges imposed by the relevant Governmental Authority) to the Agent or
such Lender in the event the Agent or such Lender is required to repay such
refund to such Governmental Authority. This paragraph shall not be
construed to require the Agent or any Lender to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to any Borrower or any other Person.
(i) Without prejudice to the survival of any other agreement of
Holdings, Irish Holdings or any Borrower hereunder, the agreements and
obligations of Holdings, Irish Holdings and each Borrower contained in this
Section 4.6 shall survive the termination of the Revolving Credit
Commitments and the payment in full of the Loans.
ARTICLE V
CONDITIONS TO MAKING LOANS
5.1. Conditions of Closing. The effectiveness of this Agreement is
subject to the conditions precedent that:
(a) the Agent shall have received, in form and substance satisfactory
to the Agent and Lenders, the following:
(i) executed originals of each of this Agreement, the Notes (if
applicable), the Contribution Agreement, the Contribution Agreement
Guaranty, the Contribution Agreement Letter Agreements, the Parent
Support Agreement, the Servicing Agreement, the ABH 12 Security
Agreement, the Second Omnibus Amendment and the Share Charge (relating
to the shares in Irish Holdings and each new Borrower that is a
Subsidiary of Irish Holdings), together with all schedules and
exhibits thereto (collectively, the "Additional Facility Documents");
(ii) the favorable written opinion or opinions with respect to
the Additional Facility Documents and the transactions contemplated
thereby of special counsel to the Credit Parties dated the Closing
Date (including an opinion
40
of Irish counsel), addressed to the Agent (on behalf of itself and the
Lenders), substantially in the form of Exhibit G-1 and Exhibit G-3 or
otherwise reasonably satisfactory to special counsel to the Agent;
(iii) resolutions of the boards of directors or other appropriate
governing body (or of the appropriate committee thereof) of Irish
Holdings and each Subsidiary thereof, certified by its secretary or
assistant secretary as of the Closing Date, approving and adopting the
Additional Facility Documents to be executed by such Person, and
authorizing the execution and delivery thereof;
(iv) specimen signatures of officers of each Additional Credit
Party, certified by the secretary or assistant secretary of each such
Additional Credit Party;
(v) the Organizational Documents of each Additional Credit Party
certified as of a recent date by the Secretary of State or comparable
official of its jurisdiction of organization;
(vi) certificate issued as of a recent date by the Secretary of
State or comparable official of the jurisdiction of formation of each
Additional Credit Party as to the due existence and good standing of
each such Additional Credit Party;
(vii) certificate of the secretary or assistant secretary of each
Credit Party party to any Additional Facility Document (other than the
Additional Credit Parties) certifying that (i) the officers set forth
in any certificate delivered to the Agent on or after the Initial
Closing Date remain as officers of such Credit Party and authorized to
execute the Additional Facility Documents and (ii) the Organizational
Documents of such Credit Party as delivered to the Agent on or after
the Initial Closing Date have not in any way been amended or modified
and remain in full force and effect as of the Closing Date.
(viii) reaffirmation by each Borrower of the appointment of the
Authorized Representative(s) pursuant to the notice dated March 4,
2005;
(ix) a Uniform Commercial Code financing statement appropriate
for filing in all places required by applicable law to perfect the
Lien of the Agent under the Security Agreement executed by each
Additional Credit Party as a first priority Lien as to items of
Collateral in which a security interest may be perfected by the filing
of financing statements, and such other documents and/or evidence of
other actions as may be necessary under applicable law to perfect the
Lien of the Agent under such Security Agreement as a first priority
Lien in and to such other Collateral as the Agent may require;
(x) evidence that any fees payable by the Parent or any Credit
Party on the Closing Date to the Agent and the Lenders have been paid
in full; and
(b) In the good faith judgment of the Agent and the Lenders:
41
(i) no litigation, action, suit, investigation or other arbitral,
administrative or judicial proceeding shall be pending or threatened
which could reasonably be likely to result in a Material Adverse
Effect; and
(ii) the Credit Parties shall have received all approvals,
consents and waivers, and shall have made or given all necessary
filings and notices as shall be required to consummate the
transactions contemplated hereby without the occurrence of any default
under, conflict with or violation of (A) any applicable law, rule,
regulation, order or decree of any Governmental Authority or arbitral
authority or (B) any agreement, document or instrument to which any of
the Credit Parties is a party or by which any of them or their
properties is bound.
5.2. Conditions of Closing of Second Amended and Restated Credit
Agreement. The effectiveness of the Second Amended and Restated Credit Agreement
was subject to the prior or concurrent satisfaction or waiver of each of the
conditions precedent set forth in this Section 5.2, other than those documents
subject to Section 7.25. For the limited purpose of this Section 5.2, the
phrases "shall have received", "shall have approved", "shall have demonstrated",
"shall have delivered" and similar phrases contemplating that future
performances were required shall be construed as being performed or waived as of
the Closing Date:
(a) the Agent shall have received, in form and substance satisfactory
to the Agent and Lenders, the following:
(i) executed originals of each of this Agreement, the Notes (if
applicable), a Facility Guaranty and the ABH 12 Security Agreement,
the amended Parent Support Agreement, the Omnibus Amendment and the
Share Charge (relating to the shares in ABH 12) executed by Holdings,
together with all schedules and exhibits thereto (collectively, the
"Additional Facility Documents");
(ii) the favorable written opinion or opinions with respect to
the Additional Facility Documents and the transactions contemplated
thereby of special counsel to the Credit Parties dated the Closing
Date (other than opinions of Irish and French counsel), addressed to
the Agent (on behalf of itself and the Lenders), substantially in the
form of Exhibit G-1 or otherwise reasonably satisfactory to special
counsel to the Agent;
(iii) resolutions of the boards of directors or other appropriate
governing body (or of the appropriate committee thereof) of each
Credit Party other than Constellation Aircraft Leasing (France) Sarl
and Constitution Aircraft Leasing (Ireland) Limited (or, in the case
of a Credit Party that is a trust, resolutions of the appropriate
board or committee of each trustee thereof) certified by its secretary
or assistant secretary as of the Closing Date, approving and adopting
the Additional Facility Documents to be executed by such Person, and
authorizing the execution and delivery thereof;
42
(iv) specimen signatures of officers of ABH 12, certified by the
secretary or assistant secretary of ABH 12;
(v) the Organizational Documents of ABH 12 certified as of a
recent date by the Secretary of State or comparable official of its
jurisdiction of organization;
(vi) certificate issued as of a recent date by the Secretary of
State or comparable official of the jurisdiction of formation of ABH
12 as to the due existence and good standing of ABH 12;
(vii) certificate of the secretary or assistant secretary of each
Credit Party party to any Additional Facility Document (other than ABH
12) certifying that (i) the officers set forth in any certificate
delivered to the Agent on or after the Initial Closing Date remain as
officers of such Credit Party and authorized to execute the Additional
Facility Documents and (ii) the Organizational Documents of such
Credit Party as delivered to the Agent on or after the Initial Closing
Date have not in any way been amended or modified and remain in full
force and effect as of the Closing Date.
(viii) reaffirmation by each Borrower of the appointment of the
Authorized Representative(s) pursuant to the notice dated March 4,
2005;
(ix) a Uniform Commercial Code financing statement appropriate
for filing in all places required by applicable law to perfect the
Lien of the Agent under the Security Agreement executed by ABH 12 as a
first priority Lien as to items of Collateral in which a security
interest may be perfected by the filing of financing statements, and
such other documents and/or evidence of other actions as may be
necessary under applicable law to perfect the Lien of the Agent under
such Security Agreement as a first priority Lien in and to such other
Collateral as the Agent may require;
(x) evidence that all fees payable by the Parent or any Credit
Party on the Closing Date to the Agent and the Lenders have been paid
in full; and
(b) In the good faith judgment of the Agent and the Lenders:
(i) no litigation, action, suit, investigation or other arbitral,
administrative or judicial proceeding shall be pending or threatened
which could reasonably be likely to result in a Material Adverse
Effect; and
(ii) the Credit Parties shall have received all approvals,
consents and waivers, and shall have made or given all necessary
filings and notices as shall be required to consummate the
transactions contemplated hereby without the occurrence of any default
under, conflict with or violation of (A) any applicable law, rule,
regulation, order or decree of any Governmental Authority or arbitral
authority or (B) any agreement, document or instrument to which any of
the Credit Parties is a party or by which any of them or their
properties is bound.
43
5.3. Conditions of Revolving Loans. The obligation of the Lenders to
make Revolving Loans hereunder on or subsequent to the Initial Closing Date
(other than additional loans to a Borrower in connection with (i) an increase in
the Applicable Aircraft Advance Rate as provided in the definition thereof, (ii)
Approved Improvements, or (iii) a Qualified Conversion) is subject to the
conditions precedent that:
(a) each of the conditions to making the Revolving Credit Facility
available to the Borrowers, as set forth in Section 5.1, shall have been
satisfied on or prior to the date of the initial Loan after the Closing
Date;
(b) the representations and warranties of the Credit Parties set forth
in Article VI and in each of the other Loan Documents shall be true and
correct in all material respects on and as of the date of such Loan, with
the same effect as though such representations and warranties had been made
on and as of such date, except to the extent that such representations and
warranties expressly relate to an earlier date;
(c) the Borrowing Affiliate with respect to such Loan shall have
executed and delivered to the Agent an Assumption Letter, and each Borrower
and the Agent shall have executed such Assumption Letter and the Borrowing
Affiliate shall have delivered to the Agent all other agreements,
instruments and documents required by such Assumption Letter;
(d) the Borrowing Affiliate with respect to such Loan shall have
delivered to the Agent (i) Facility Guaranties fully executed by Holdings,
Irish Holdings and any Beneficial Owner of such Borrowing Affiliate, by
each Subsidiary of any such Beneficial Owner (other than such Borrowing
Affiliate), by each Subsidiary of such Borrowing Affiliate and by the
Applicable Intermediary (if any); (ii) Pledge Agreements fully executed by
the appropriate pledgors, granting a security interest in all Pledged
Interests with respect to each such Beneficial Owner, such Borrowing
Affiliate, each Subsidiary of any Beneficial Owner, each Subsidiary of such
Borrowing Affiliate, and the Applicable Intermediary (if any); (iii)
Security Agreements fully executed by such Borrowing Affiliate, any
Beneficial Owner of such Borrowing Affiliate, each Subsidiary of any
Beneficial Owner, each Subsidiary of such Borrowing Affiliate, and the
Applicable Intermediary (if any); and ((iv) Lockbox Agreements executed by
each Borrower;
(e) the Agent shall have received the latest drafts of the following
within 5 Business Days prior to the date of the Loan, an organized
pre-closing of the required documentation shall have occurred at least one
Business Day prior to the date of the Loan, and the Agent shall have
received final versions of the following, in form and substance
satisfactory to the Agent and the Lenders, on or prior to the date of the
Loan:
(i) each of the documents and instruments (including without
limitation the opinions of counsel, the resolutions of boards of
directors or other appropriate governing bodies or committees, the
specimen signatures, officer's certificates, Organizational Documents
and governmental certificates of existence, qualification, good
standing and assumed name) required by Section 5.1 as if such
Borrowing Affiliate had been a Borrowing Affiliate (and its
44
Beneficial Owner, their respective Subsidiaries and the Applicable
Intermediary (if any) had been in such positions) on the Initial
Closing Date;
(ii) with respect to each Financed Aircraft registered in the
United States, the favorable written opinion with respect to the Loan
Documents and the transactions contemplated thereby of FAA Counsel
dated the date of such Loan, addressed to the Agent (on behalf of
itself and the Lenders), substantially in the form of Exhibit G-2 or
otherwise reasonably satisfactory to special counsel to the Agent;
(iii) with respect to every other Financed Aircraft, the
favorable written opinion with respect to the Loan Documents and the
transactions contemplated thereby of local counsel in each Applicable
Foreign Jurisdiction dated the date of such Loan, addressed to the
Agent (on behalf of itself and the Lenders), substantially in the
forms of Exhibit G-3 and Exhibit G-4 or otherwise reasonably
satisfactory to special counsel to the Agent;
(iv) certificates of insurance from qualified brokers of aircraft
insurance or other evidence satisfactory to the Agent, evidencing all
insurance required by the Loan Documents (including without limitation
all insurance required by Exhibit L with respect to each Aircraft that
is to be a Financed Aircraft);
(v) a Borrowing Notice;
(vi) a certificate of an Authorized Representative substantially
in the form of Exhibit R containing computations of the Borrowing Base
and providing information about the Financed Aircraft, in each case
after giving effect to such Loan and any related Financed Aircraft;
(vii) Uniform Commercial Code financing statements appropriate
for filing in all places required by applicable law to perfect the
Liens of the Agent under the Security Instruments as a first priority
Lien as to items of Collateral in which a security interest may be
perfected by the filing of financing statements, and such other
documents and/or evidence of other actions as may be necessary under
applicable law to perfect the Liens of the Agent under the Security
Instruments as a first priority Lien in and to such other Collateral
as the Agent may require, including without limitation:
(1) the delivery by the Borrowers of all stock
certificates and other certificates, if any, evidencing
ownership of any Pledged Interests, accompanied in each case
by duly executed stock or transfer powers (or other
appropriate transfer documents) in blank affixed thereto;
and
(2) the delivery by the Borrowers of "control
agreements" that have been executed by the respective
issuers (and
45
consented to by the respective Credit Parties) with respect
to any uncertificated Pledged Interests;
(3) with respect to each Financed Aircraft registered
in the United States, evidence of the filing with the FAA
Recording Office all documents required by the FAA in order
to protect the Applicable Borrower's right, title and
interest in such Financed Aircraft;
(4) with respect to each Financed Aircraft not
registered in the United States, evidence of the filing with
each applicable recording office in each Applicable Foreign
Jurisdiction of all documents required by such office or any
Applicable Foreign Aviation Law in order to protect the
Applicable Borrower's right, title and interest in such
Financed Aircraft in such Applicable Foreign Jurisdiction;
(5) a copy of the executed purchase agreement and
executed xxxx of sale evidencing the purchase by the
Applicable Borrower of each Financed Aircraft;
(6) copies of the certificates of aircraft registration
issued by the FAA and certificates of airworthiness issued
by the FAA, in each case with respect to each Aircraft
registered in the United States; and
(7) evidence of registration and other applicable
qualification issued by any Applicable Foreign Jurisdiction
to the extent such registration or qualification is required
by an Applicable Foreign Aviation Law, in each case with
respect to each Aircraft not registered in the United
States;
(viii) results of a search of Liens filed with the FAA or any
Applicable Foreign Jurisdiction with respect to any Aircraft that is
or is to be a Financed Aircraft;
(ix) for each Financed Aircraft that will be subject to an
Eligible Lease on the date of the initial Loan, copies of each such
Eligible Lease;
(x) for each Financed Aircraft that will be subject to an
Eligible Lease on the date of the initial Loan for such Financed
Aircraft, a Lessee Notice and evidence (which may be in the form of a
legal opinion) that the Agent shall have the right, under the laws of
the Applicable Foreign Jurisdiction, to enforce directly the Eligible
Lease against the Lessee, including without limitation, the obligation
of the Lessee to make payments under the Eligible Lease to the
applicable Account; and
46
(xi) a fully-executed copy of the Servicing Agreement certified
by a Secretary or Assistant Secretary of Servicer, and certification
of the amount of fees to be payable to Servicer in connection with
such Servicing Agreement, which agreement and fees shall be acceptable
to the Agent in its sole reasonable discretion;
(f) at the time of (and after giving effect to) the initial Loan, no
Default or Event of Default specified in Article IX shall have occurred and
be continuing;
(g) immediately after giving effect to the initial Loan;
(i) the aggregate principal balance of all outstanding Revolving
Loans for each Lender shall not exceed such Lender's Revolving Credit
Commitment; and
(ii) the Revolving Credit Outstandings shall not exceed the
lesser of the Borrowing Base or the Total Revolving Credit Commitment.
5.4. Conditions of Subsequent Advances Under Revolving Loans. The
obligation of the Lenders to make an additional loan to a Borrower in connection
with (i) an increase in the Applicable Aircraft Advance Rate as provided in the
definition thereof, (ii) Approved Improvements, or (iii) a Qualified Conversion
is subject to the conditions precedent that:
(a) the representations and warranties of the Credit Parties set forth
in Article VI and in each of the other Loan Documents shall be true and
correct in all material respects on and as of the date of such Loan, with
the same effect as though such representations and warranties had been made
on and as of such date, except to the extent that such representations and
warranties expressly relate to an earlier date;
(b) the Agent shall have received final versions of the following at
least one Business Day prior to the date of the Loan:
(i) a Borrowing Notice; and
(ii) a certificate of an Authorized Representative substantially
in the form of Exhibit R containing computations of the Borrowing Base
and providing information about the Financed Aircraft, in each case
after giving effect to such Loan and any related Financed Aircraft;
(c) at the time of (and after giving effect to) the initial Loan, no
Default or Event of Default specified in Article IX shall have occurred and
be continuing; and
(d) immediately after giving effect to the initial Loan;
(i) the aggregate principal balance of all outstanding Revolving
Loans for each Lender shall not exceed such Lender's Revolving Credit
Commitment;
47
(ii) the Revolving Credit Outstandings shall not exceed the
lesser of the Borrowing Base or the Total Revolving Credit Commitment.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Holdings, Irish Holdings, ABH 12 and each Borrower represents and
warrants with respect to itself, its Subsidiaries (if any) and each other Credit
Party (which representations and warranties shall survive the delivery of the
documents mentioned herein and the making of Loans), that:
6.1. Organization and Authority.
(a) Each Borrower, each Subsidiary and each other Credit Party is a
trust, corporation, partnership or limited liability company duly organized
and validly existing under the laws of the jurisdiction of its formation;
(b) Each Borrower, each Subsidiary and each other Credit Party (x) has
the requisite power and authority to own its properties and assets and to
carry on its business as now being conducted and as contemplated in the
Loan Documents, and (y) is qualified to do business in every jurisdiction
in which failure so to qualify would have a Material Adverse Effect;
(c) Each Borrower has the power and authority to execute, deliver and
perform this Agreement and the Notes (if applicable), and to borrow
hereunder, and to execute, deliver and perform each of the other Loan
Documents to which it is a party;
(d) Each Credit Party (other than the Borrowers) has the power and
authority to execute, deliver and perform each of the Loan Documents to
which it is a party; and
(e) When executed and delivered, each of the Loan Documents to which
any Credit Party is a party will be the legal, valid and binding obligation
or agreement, as the case may be, of such Credit Party (as the case may
be), enforceable against such Credit Party (as the case may be) in
accordance with its terms, subject to the effect of any applicable
bankruptcy, moratorium, insolvency, reorganization or other similar law
affecting the enforceability of creditors' rights generally and to the
effect of general principles of equity (whether considered in a proceeding
at law or in equity);
6.2. Loan Documents. The execution, delivery and performance by each
Credit Party of each of the Loan Documents to which it is a party:
(a) have been duly authorized by all requisite Organizational Action
of such Credit Party (as the case may be) required for the lawful
execution, delivery and performance thereof;
(b) do not violate any provisions of (i) applicable law, rule or
regulation, (ii) any judgment, writ, order, determination, decree or
arbitral award of any Governmental
48
Authority or arbitral authority binding on such Credit Party or their
respective properties, or (iii) the Organizational Documents of such Credit
Party;
(c) does not and will not be in conflict with, result in a breach of
or constitute an event of default, or an event which, with notice or lapse
of time or both, would constitute an event of default, under any contract,
indenture, agreement or other instrument or document to which such Credit
Party is a party, or by which the properties or assets of such Credit Party
are bound; and
(d) does not and will not result in the creation or imposition of any
Lien upon any of the properties or assets of such Credit Party or any
Subsidiary except any Liens in favor of the Agent and the Lenders created
by the Security Instruments;
6.3. Solvency. At the time of each Loan to a Borrower, such Borrower
and each Beneficial Owner of such Borrower and each Eligible Intermediary, if
any, is Solvent after giving effect to the transactions contemplated by the Loan
Documents;
6.4. Subsidiaries and Stockholders. No Borrower or Guarantor (other
than Holdings and Irish Holdings) has any Subsidiaries, except that a Guarantor
may have a beneficial interest in a Borrower, a Borrower may own an Eligible
Intermediary and a Borrower may be a Subsidiary of a Guarantor;
6.5. Ownership Interests.
(a) No Borrower or Guarantor owns any interest in any Person, except
that a Guarantor may have a beneficial interest in a Borrower, and a
Borrower may own an Eligible Intermediary; and
(b) Holdings or Irish Holdings owns, directly or indirectly, all of
the Capital Stock of each Borrower, except for directors' qualifying
shares, if any.
6.6. Liens. The Agent (for itself and on behalf of the Lenders) has a
first priority perfected Lien (subject to Permitted Liens) on all Collateral
under the Security Instruments;
6.7. Title to Properties. Each Borrower and each of its Subsidiaries
and each other Credit Party has good and marketable title to all its real and
personal properties, subject to no transfer restrictions or Liens of any kind
except as provided in the Security Instruments and the Leases; and
6.8. Taxes. Except as set forth in Schedule 6.8, each Borrower, each
of its Subsidiaries and each Credit Party has filed or caused to be filed all
federal, state and local tax returns in each case that are required to be filed
by it and that, the failure to file, would have a Material Adverse Effect and,
except for taxes and assessments being contested in good faith by appropriate
proceedings diligently conducted and against which reserves reflected in the
financial statements most recently delivered pursuant to Section 7.1(a) and
satisfactory to the Borrowers' independent certified public accountants have
been established, have paid or caused
49
to be paid all taxes as shown on said returns or on any assessment received by
it, to the extent that such taxes have become due;
6.9. Other Agreements. No Credit Party nor any Subsidiary
(i) is a party to or subject to any judgment, order, decree,
agreement, lease or instrument, or subject to other restrictions,
which individually or in the aggregate could reasonably be expected to
have a Material Adverse Effect;
(ii) is in default in the performance, observance or fulfillment
of any of the obligations, covenants or conditions contained in any
agreement or instrument to which such Credit Party or any Subsidiary
is a party, which default has, or if not remedied within any
applicable grace period could reasonably be likely to have, a Material
Adverse Effect; or
(iii) shall have, prior to its execution of the Assumption
Letter, conducted business other than related to the acquisition,
leasing, maintenances, financing (solely under the Loan Documents),
ownership and disposition of Eligible Aircraft or have incurred any
liabilities except to the extent related to such business, including,
without limitation, under the Eligible Lease to which it is a party,
an aircraft acquisition, sale, maintenance or overhaul agreement and
the Loan Documents, none of which liabilities (except (a) the purchase
price in respect of an Aircraft, (b) liabilities in respect of
Approved Improvements and (c) those arising under the Loan Documents
and the Eligible Leases) are material to the Borrowers taken as a
whole.
6.10. Litigation. Except as set forth in Schedule 6.10, there is no
action, suit, investigation or proceeding at law or in equity or by or before
any governmental instrumentality or agency or arbitral body pending, or, to the
knowledge of any Borrower, threatened by or against any Borrower or any
Subsidiary or other Credit Party or affecting any Borrower or any Subsidiary or
other Credit Party or any properties or rights of any Borrower or any Subsidiary
or other Credit Party, which could reasonably be likely to have a Material
Adverse Effect;
6.11. Federal Regulations. No part of the proceeds of any Loans, and
no other extensions of credit hereunder, will be used (a) for "buying" or
"carrying" any "margin stock" within the respective meanings of each of the
quoted terms under Regulation U as now and from time to time hereafter in effect
for any purpose that violates the provisions of the Regulations of the Board or
(b) for any purpose that violates the provisions of the Regulations of the
Board. If requested by any Lender or the Agent, the Borrowers will furnish to
the Agent and each Lender a statement to the foregoing effect in conformity with
the requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in
Regulation U.
6.12. Investment Company. No Credit Party is an "investment company,"
or "promoter" or "principal underwriter" for, an "investment company", as such
terms are defined in the Investment Company Act of 1940, as amended (15 U.S.C.
Section 80a-1, et seq.). The application of the proceeds of the Loans and
repayment thereof by each Borrower and the performance by each Borrower and the
other Credit Parties of the transactions contemplated by
50
the Loan Documents will not violate any provision of said Act, or any rule,
regulation or order issued by the Securities and Exchange Commission thereunder,
in each case as in effect on the date hereof;
6.13. Patents, Etc. Each Borrower and each other Credit Party owns or
has the right to use, under valid license agreements or otherwise, all material
patents, licenses, franchises, trademarks, trademark rights, trade names, trade
name rights, trade secrets and copyrights necessary to or used in the conduct of
its businesses as now conducted and as contemplated by the Loan Documents,
without known conflict with any patent, license, franchise, trademark, trade
secret, trade name, copyright, other proprietary right of any other Person;
6.14. No Untrue Statement. Neither (a) this Agreement nor any other
Loan Document or certificate or document executed and delivered by or on behalf
of any Borrower or any other Credit Party in accordance with or pursuant to any
Loan Document nor (b) any written statement, representation, or warranty
provided to the Agent in connection with the negotiation or preparation of the
Loan Documents contains any misrepresentation or untrue statement of material
fact or omits to state a material fact necessary, in light of the circumstance
under which it was made, in order to make any such warranty, representation or
statement contained therein not misleading;
6.15. No Consents, Etc. Neither the respective businesses or
properties of the Credit Parties or any Subsidiary, nor any relationship among
the Credit Parties or any Subsidiary and any other Person, nor any circumstance
in connection with the execution, delivery and performance of the Loan Documents
and the transactions contemplated thereby, is such as to require a consent,
approval or authorization of, or filing, registration or qualification with, any
Governmental Authority or any other Person on the part of any Credit Party as a
condition to the execution, delivery and performance of, or consummation of the
transactions contemplated by the Loan Documents, which, if not obtained or
effected, would be reasonably likely to have a Material Adverse Effect, or if
so, such consent, approval, authorization, filing, registration or qualification
has been duly obtained or effected, as the case may be;
6.16. Employee Benefit Plans.
(a) Neither any Guarantor nor any Borrower or any of their respective
Subsidiaries has or has ever sponsored any Employee Benefit Plan, any
Single Employer Plan or any Multiemployer Plan, or had any obligation to
fund any such plan;
(b) Neither any Borrower nor any ERISA Affiliate has incurred any
"accumulated funding deficiency" within the meaning of Section 412 of the
Code or Section 302 of ERISA with respect to any Single Employer Plan,
whether or not waived, during the six-year period to the date on which this
representation is made or deemed made or any other liability to the PBGC
which remains outstanding, in each case, in an amount that would be
reasonably likely to have a Material Adverse Effect;
(c) No Termination Event has occurred during the six-year period prior
to the date on which this representation is made or deemed made or is
reasonably expected to
51
occur with respect to any Single Employer Plan or Multiemployer Plan,
neither any Borrower nor any ERISA Affiliate has incurred any unpaid
withdrawal liability with respect to any Multiemployer Plan that, in each
case, could be reasonably expected to have a Material Adverse Effect; and
(d) The present value of all accrued benefits under each Single
Employer Plan (based on those assumptions used to fund such Single Employer
Plans) did not, as of the last annual valuation date prior to the date on
which this representation is made or deemed made for each such plan, exceed
the then current value of the assets of such Single Employer Plan allocable
to such benefits by a material amount;
6.17. No Default. As of the date hereof, there does not exist any
Default or Event of Default hereunder;
6.18. Environmental Laws. Except as listed on Schedule 6.18, each
Borrower, each Guarantor and each Subsidiary is in compliance with all
applicable Environmental Laws and has been issued and currently maintains all
required federal, state and local permits, licenses, certificates and approvals.
Except as listed on Schedule 6.18, neither any Borrower, any Guarantor nor any
Subsidiary has been notified of any pending or threatened action, suit,
proceeding or investigation, and neither any Borrower, any Guarantor nor any
Subsidiary is aware of any facts, which (a) calls into question, or could
reasonably be expected to call into question, compliance by any Borrower, any
Guarantor or any Subsidiary with any Environmental Laws, (b) seeks, or could
reasonably be expected to form the basis of a meritorious proceeding, to
suspend, revoke or terminate any license, permit or approval necessary for the
operation of any Borrower's, any Guarantor's or any Subsidiary's business or
facilities or for the generation, handling, storage, treatment or disposal of
any Hazardous Materials, or (c) seeks to cause, or could reasonably be expected
to form the basis of a meritorious proceeding to cause, any property of any
Borrower, any Guarantor or any Subsidiary or other Credit Party to be subject to
any restrictions on ownership, use, occupancy or transferability under any
Environmental Law; and
6.19. Employment Matters. No Borrower or Guarantor has or has ever had
any employee other than officers thereof.
ARTICLE VII
AFFIRMATIVE COVENANTS
Unless the Required Lenders shall otherwise consent in writing,
Holdings, Irish Holdings and each Borrower will, and where applicable will cause
each Guarantor and each Subsidiary (if any) to:
7.1. Financial Reports, Etc.
(a) As soon as practical and in any event within 90 days after the end
of each Fiscal Year, deliver or cause to be delivered to the Agent and each
Lender audited consolidated balance sheets of Parent and its Subsidiaries
as at the end of such Fiscal
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Year, and the notes thereto (if any), and the relating audited consolidated
statements of income, changes in stockholders' (or members') equity and
cash flows, and the respective notes thereto (if any), for such Fiscal
Year, setting forth comparative financial statements for the preceding year
(if applicable), reported on by Ernst & Young LLP or other independent
certified public accountants of nationally recognized standing all prepared
in accordance with GAAP and accompanied by a certificate of an Authorized
Representative, which certificate shall be in the form of Exhibit H;
(b) as soon as practical and in any event within 60 days after the end
of each fiscal quarter (except the last fiscal quarter of the Fiscal Year),
deliver to the Agent and each Lender consolidated income statements of
Parent and its Subsidiaries prepared in accordance with GAAP and
accompanied by a certificate of an Authorized Representative to the effect
that such financial statements present fairly, in all material respects,
the financial position of Parent and its Subsidiaries and of each of the
Borrowers and their respective Subsidiaries as of the end of such fiscal
period and the results of their operations for such fiscal period;
(c) as soon as practical and in any event within 30 days after the end
of each calendar month, deliver or cause to be delivered to the Agent and
each Lender a certificate of an Authorized Representative containing
computations of the Borrowing Base, providing information about the
Financed Aircraft, and stating that each Borrower is in compliance with the
covenants and terms hereof and that no Default or Event of Default has
occurred and is continuing, in each case as of the end of such month, which
certificate shall be in the form of Exhibit R;
(d) promptly upon their becoming available to Holdings, Irish Holdings
or any Borrower, such Person shall deliver to the Agent and each Lender a
copy of (i) all regular or special reports or effective registration
statements which Holdings, Irish Holdings, any Borrower, any Guarantor or
any Subsidiary shall file with the Securities and Exchange Commission (or
any successor thereto) or any securities exchange, (ii) any proxy statement
distributed by Holdings, Irish Holdings, any Borrower, any Guarantor or any
Subsidiary to its shareholders, bondholders or the financial community in
general, and (iii) any management letter or other report submitted to any
Borrower, any Guarantor or any Subsidiary by independent accountants in
connection with any annual, interim or special audit of any Borrower or any
Subsidiary; and
(e) promptly, from time to time, deliver or cause to be delivered to
the Agent and each Lender such other information regarding Holdings', Irish
Holdings', any Borrower's, any Guarantor's and any Subsidiary's operations,
business affairs and financial condition as the Agent or such Lender may
reasonably request.
Subject to Section 11.15, the Agent and the Lenders are hereby authorized to
deliver a copy of any such financial or other information delivered hereunder to
the Lenders (or any affiliate of any Lender) or to the Agent, to any
Governmental Authority having jurisdiction over the Agent or any of the Lenders
pursuant to any written request therefor or in the ordinary course of
examination of loan files, or to any other Person who shall acquire or consider
the assignment of, or acquisition of any participation interest in, any
Obligation permitted by this Agreement;
53
7.2. Maintain Properties. If a Financed Aircraft is not subject to an
Eligible Lease, maintain and make repairs to such Financed Aircraft in
compliance with the requirements set forth in Section 3.4 of the Security
Agreement; and each Borrower, Guarantor and Subsidiary shall maintain all other
properties necessary to its operations in good working order and condition, make
all needed repairs, replacements and renewals to such other properties, and
maintain free from Liens all trademarks, trade names, patents, copyrights, trade
secrets, know-how, and other intellectual property and proprietary information
(or adequate licenses thereto), in each case as are reasonably necessary to
conduct its business as currently conducted or as contemplated hereby, all in
accordance with customary and prudent business practices;
7.3. Existence, Qualification, Etc. Except as otherwise expressly
permitted under Section 8.7, do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and all material rights
and franchises, and maintain its license or qualification to do business as a
foreign corporation and good standing in each jurisdiction in which its
ownership or lease of property or the nature of its business makes such license
or qualification necessary;
7.4. Regulations and Taxes. Comply in all material respects with or
contest in good faith all statutes and governmental regulations and pay all
taxes, assessments, governmental charges, claims for labor, supplies, rent and
any other obligation which, if unpaid, would become a Lien other than a
Permitted Lien against any of its properties;
7.5. Insurance. Maintain or cause to be maintained with respect to
each Financed Aircraft and all other Collateral the insurance described on
Exhibit L;
7.6. True Books. Keep true books of record and account in which full,
true and correct entries will be made of all of its dealings and transactions,
and set up on its books such reserves as may be required by GAAP with respect to
doubtful accounts and all taxes, assessments, charges, levies and claims and
with respect to its business in general, and include such reserves in interim as
well as year-end financial statements;
7.7. Right of Inspection. Permit any Person designated by any Lender
or the Agent to visit and inspect any Aircraft, or any other property, corporate
book or financial report of any Borrower or any Subsidiary and to discuss its
affairs, finances and accounts with its principal officers and independent
certified public accountants; and cause each Eligible Carrier to permit any
Person designated by any Lender or any Agent to inspect any Financed Aircraft,
all at reasonable times, at reasonable intervals and with reasonable prior
notice, subject to any restriction on inspection contained in an Eligible Lease
with respect to such Financed Aircraft, provided that notwithstanding any such
Lease, (a) any Person designated by a Lender or the Agent may inspect such
Financed Aircraft at any reasonable time upon an event of default under such
Lease, and (b) upon any Event of Default, the Applicable Borrower will use its
best efforts to cause the Applicable Carrier (and any other Person) to permit
any Person designated by a Lender or the Agent to inspect such Financed Aircraft
at any time;
7.8. Observe all Laws. Conform to and duly observe in all material
respects all laws, rules and regulations and all other valid requirements of any
Governmental Authority with respect to the conduct of its business;
54
7.9. Governmental Licenses. Obtain and maintain all licenses, permits,
certifications and approvals of all applicable Governmental Authorities as are
required for the conduct of its business as currently conducted and as
contemplated by the Loan Documents;
7.10. Covenants Extending to Other Persons. Cause each Guarantor and
each of their respective Subsidiaries (if any) to do with respect to itself, its
business and its assets, each of the things required of any Borrower in Sections
7.2 through 7.9, and 7.18 inclusive;
7.11. Officer's Knowledge of Default. Upon any officer of any
Guarantor or any Borrower obtaining knowledge of any Default or Event of Default
hereunder or under any other obligation of any Borrower or any Subsidiary or
other Credit Party to any Lender, or any event, development or occurrence which
could reasonably be expected to have a Material Adverse Effect, cause such
officer or an Authorized Representative to promptly notify the Agent of the
nature thereof, the period of existence thereof, and what action such Borrower
or such Subsidiary or other Credit Party proposes to take with respect thereto;
7.12. Suits or Other Proceedings. Upon any officer of any Guarantor or
any Borrower obtaining knowledge of any action, suit, litigation, investigation,
or other proceeding being instituted or threatened against any Borrower or any
Subsidiary or other Credit Party, in any court or before any Governmental
Authority, or any attachment, levy, execution or other process being instituted
against any assets of any Borrower or any Subsidiary or other Credit Party,
making a claim or claims in an aggregate amount greater than $250,000, exclusive
of punitive damages, not otherwise covered by insurance or that would otherwise
be reasonably expected to have a Material Adverse Effect, promptly deliver to
the Agent written notice thereof stating the nature and status of such action,
suit, litigation, investigation, dispute, proceeding, levy, execution or other
process;
7.13. Notice of Environmental Complaint or Condition. Promptly provide
to the Agent true, accurate and complete copies of any and all notices,
complaints, orders, directives, claims or citations received by any Borrower,
any Guarantor or any Subsidiary relating to any (a) violation or alleged
violation by any Borrower, any Guarantor or any Subsidiary of any applicable
Environmental Law; (b) release or threatened release by any Borrower, any
Guarantor or any Subsidiary, or by any Person handling, transporting or
disposing of any Hazardous Material on behalf of any Borrower, any Guarantor or
any Subsidiary, or at any facility or property owned or leased or operated by
any Borrower, any Guarantor or any Subsidiary, of any Hazardous Material, except
where occurring legally pursuant to a permit or license; or (c) liability or
alleged liability of any Borrower, any Guarantor or any Subsidiary for the costs
of cleaning up, removing, remediating or responding to a release of Hazardous
Materials;
7.14. Environmental Compliance. If any Borrower, any Guarantor or any
Subsidiary shall receive any letter, notice, complaint, order, directive, claim
or citation alleging that any Borrower, any Guarantor or any Subsidiary has
violated any Environmental Law, has released any Hazardous Material, or is
liable for the costs of cleaning up, removing, remediating or responding to a
release of Hazardous Materials, any Borrower, any Guarantor and any Subsidiary
shall, within the time period permitted and to the extent required by the
applicable Environmental Law or the Governmental Authority responsible for
enforcing such
55
Environmental Law, remove or remedy, or cause the applicable Subsidiary to
remove or remedy, such violation or release or satisfy such liability;
7.15. Indemnification. Without limiting the generality of Section
11.9, Holdings, Irish Holdings and each Borrower hereby agrees jointly and
severally to indemnify and hold the Agent and the Lenders, and their respective
officers, directors, employees and agents, harmless from and against any and all
claims, losses, penalties, liabilities, damages and expenses (including
assessment and cleanup costs and reasonable attorneys', consultants' or other
expert fees, expenses and disbursements) arising directly or indirectly from,
out of or by reason of (a) the violation of any Environmental Law by any
Borrower or any Subsidiary or with respect to any property owned, operated or
leased by any Borrower or any Subsidiary or (b) the handling, storage,
transportation, treatment, emission, release, discharge or disposal of any
Hazardous Materials by or on behalf of any Borrower or any Subsidiary, or on or
with respect to property owned or leased or operated by any Borrower or any
Subsidiary. The provisions of this Section 7.15 shall survive repayment of the
Obligations and expiration or termination of this Agreement;
7.16. Further Assurances. At the Borrowers' cost and expense, upon
request of the Agent, duly execute and deliver or cause to be duly executed and
delivered, to the Agent such further instruments, documents, certificates,
financing and continuation statements, and do and cause to be done such further
acts that may be reasonably necessary or advisable in the reasonable opinion of
the Agent to carry out more effectively the provisions and purposes of this
Agreement, the Security Instruments and the other Loan Documents;
7.17. Swap Agreements. Subject to Section 8.4, each Borrower may, in
its sole discretion, maintain Swap Agreements in a notional amount not greater
than Loans made to such Borrower and for a tenor not longer than the Eligible
Lease to which such Borrower's Aircraft is subject. If the termination date of
any Swap Agreement falls after the first anniversary of the Stated Termination
Date, then such Swap Agreement shall provide for the settlement of such Swap
Agreement on such first anniversary unless such Borrower and the counterparty to
such Swap Agreement shall agree to the assignment and assumption of all of the
rights and obligations of the Borrower under such Swap Agreement by the issuer
of the securities issued in a Permanent Capital Markets Financing the proceeds
of which are applied to repay the related Loans;
7.18. Continued Operations. Subject to Section 8.15, continue at all
times to conduct its business and engage principally in the same line or lines
of business substantially as heretofore conducted;
7.19. Maintenance of Aircraft; Other Covenants and Restrictions;
Non-Discrimination.
(a) Ensure that any Lease with respect to any Financed Aircraft
contains covenants and restrictions regarding the maintenance, alteration,
replacement, pooling, sublease and (in the case of a Lease) return of such
Aircraft by the Applicable Carrier, which covenants and restrictions
satisfy the requirements of Schedule 7.19(a) hereto;
56
(b) Promptly and diligently take or cause to be taken all steps which
a prudent international aircraft lessor or financier would reasonably take
in light of all of the relevant circumstances to compel the relevant
Eligible Carrier to comply with the terms of any Lease, or, if applicable
and the Applicable Borrower is entitled to do so, to repossess the
applicable Financed Aircraft (and, if a prudent international aircraft
lessor or financier would determine it necessary or desirable, to
de-register and export the same to a safe location) if any failure to
comply with such Lease is not promptly remedied;
7.20. Re-registration of Aircraft. Ensure that any Lease with respect
to any Aircraft contain covenants and restrictions regarding re-registration of
such Aircraft, which covenants and restrictions satisfy the requirements of the
Security Agreement;
7.21. Servicer. Ensure that each Servicer continues to serve in
compliance with the Servicing Agreement to which it is a party;
7.22. Employee Benefit Plans. Without limiting the generality of
Section 8.9(a)) with reasonable promptness, and in any event within thirty (30)
days after any Borrower knows or has reason to know thereof, give notice to the
Agent of (a) the establishment of any Single Employer Plan (which notice shall
include a copy of such plan), (b) the failure of any Borrower or any ERISA
Affiliate to make a required installment or payment under Section 302 of ERISA
or Section 412 of the Code by the due date; (c) the occurrence of a Termination
Event with respect to any Single Employer Plan or Multiemployer Plan; and (d)
the institution of proceedings or the taking of any other action by the PBGC or
any Borrower or any ERISA Affiliate or any Multiemployer Plan with respect to
the withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan;
7.23. Accounts. Holdings, Irish Holdings, the Guarantors and the
Borrowers shall establish the Accounts as provided in the Lockbox Agreement and
shall deposit all proceeds (including without limitation rent) from any Lease of
any Financed Aircraft to the Accounts designated under the Lockbox Agreement;
7.24. Eligible Lease; Lessee Notice. Deliver to the Agent promptly
upon execution, any Lease entered into by any Borrower, together with a Lessee
Notice in connection with such Lease, the opinion referred to in Section
5.3(e)(iii) and the evidence referred to in Section 5.3(e)(x); and
7.25. Conditions Subsequent to Closing. Deliver to the Agent on the
borrowing date immediately following the Closing Date but in no event later than
[October 31, 2005], (i) the favorable written opinion or opinions with respect
to those additional required Security Instruments governed under Bermuda, Irish
or French law, addressed to the Agent (on behalf of itself and the Lenders),
substantially in the form of Exhibit G-1 or otherwise reasonably satisfactory to
special counsel to the Agent and (ii) any related resolutions of the boards of
directors or other appropriate governing body (or of the appropriate committee
thereof) required in connection with clause (i) above.
57
ARTICLE VIII
NEGATIVE COVENANTS
Until the Obligations have been paid and satisfied in full and this
Agreement has been terminated in accordance with the terms hereof, unless the
Required Lenders shall otherwise consent in writing, none of Holdings, Irish
Holdings or any Borrower will, nor will any such Person permit any Guarantor or
any Subsidiary (if any) to:
8.1. Acquisitions. Enter into any agreement, contract, binding
commitment or other arrangement providing for any Acquisition, or take any
action to solicit the tender of securities or proxies in respect thereof in
order to effect any Acquisition, except for Acquisition of a Subsidiary as
permitted by Section 8.6;
8.2. Capital Expenditures. Make or become committed to make any
Capital Expenditures, except for Capital Expenditures to maintain or purchase
Eligible Aircraft or in connection with Approved Improvements and Qualified
Conversions;
8.3. Liens. Incur, create or permit to exist any Lien, charge or other
encumbrance of any nature whatsoever with respect to (a) any property or assets
now owned or hereafter acquired by any Borrower, any Guarantor or any Subsidiary
or (b) any Financed Aircraft, except the following (the "Permitted Liens"):
(i) Liens created under the Security Instruments in favor of the
Agent and the Lenders; and Liens arising under the Eligible Leases in
favor of the Applicable Intermediary (as lessor) or the Applicable
Borrower which Liens in each case have been assigned to the Agent;
(ii) Liens set forth in Schedule 6.7;
(iii) Liens imposed by law for Taxes (A) not yet due or (B) which
are being contested in good faith by appropriate proceedings
diligently conducted, each of which Liens in clause (B) above shall be
fully bonded over, to the reasonable satisfaction of the Agent;
(iv) statutory Liens of landlords and Liens of mechanics,
materialmen and other Liens imposed by law or created in the ordinary
course of business and (i) in existence less than 90 days from the
date of creation thereof for amounts not yet due or (ii) which are
being contested in good faith by appropriate proceedings diligently
conducted, which are inferior in respect of the Collateral to the
Liens conferred under the Security Instruments or have been fully
bonded over to the reasonable satisfaction of the Agent, and with
respect to which adequate reserves or other appropriate provisions are
being maintained in accordance with GAAP;
(v) Liens arising out of any judgment or award with respect to
which an appeal or proceeding for review is being prosecuted in good
faith by appropriate proceedings diligently conducted, and with
respect to which a stay of execution is in effect;
58
(vi) Liens created by the Applicable Carrier under an Eligible
Lease that are not subject to clause (vii) below, which Liens are
created without the knowledge of the Applicable Borrower and are
released or fully bonded over to the reasonable satisfaction of the
Agent within 30 days after the Applicable Borrower has notice or
knowledge of any such Lien;
(vii) with respect to any Lease and the related Aircraft, (i) any
"Permitted Liens" (as defined in or the equivalent term in such Lease
Agreement and as agreed to by the Agent) (except a Permitted Lien that
is a Lessor Lien (as defined in or the equivalent term in such Lease
Agreement)), and (ii) any other Lien created by a Lessee, a sublessee
of a Lessee or any Person claiming by or through a Lessee or
sublessee, in each case in this clause (ii) as agreed to by the Agent;
provided, that with respect to Liens of the type listed in clause
(ii), such Lien is being contested in good faith by appropriate
proceedings or, upon the Applicable Borrower receiving notice or
knowledge of such Lien, such Applicable Borrower is diligently and
promptly enforcing the lessor's rights against the Lessee;
(viii) any head lease in respect of any Aircraft; provided that,
except in the case of the head lease in respect of the Financed
Aircraft with manufacturer's serial number 967, the lessor and lessee
thereunder are Borrowing Affiliates or Guarantors;
(ix) any Lien from air navigation authority, airport tending,
gate or handling (or similar) charges or levies (A) not yet overdue or
(B) which are being contested in good faith by appropriate
proceedings, each of which Liens in clause (B) above shall be fully
bonded over, to the reasonable satisfaction of the Agent;
(x) Liens securing Indebtedness described in Section 8.4(b);
(xi) Liens securing Indebtedness described in Section 8.4(f); and
(xii) Liens granted by a Credit Party in favor of a Lender or an
Affiliate of a Lender securing the Rate Hedging Obligations of such
Credit Party to such Lender or Affiliate.
8.4. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness of Holdings, Irish Holdings, any Borrower, any Guarantor or any
Subsidiary, howsoever evidenced, except:
(a) Indebtedness owing to (including guaranties in favor of) the Agent
or any Lender in connection with this Agreement, any Note or other Loan
Document or, in the case of ABH 12, the ABH 12-JPM Swap Agreement in an
aggregate notional amount not to exceed $400,000,000;
(b) In the case of each such Person other than ABH 12, the endorsement
of negotiable instruments for deposit or collection or similar transactions
in the ordinary course of business;
59
(c) In the case of each such Person other than ABH 12, Indebtedness
arising from Swap Agreements permitted under Section 7.17; provided that
the aggregate notional amount of Swap Agreements, including the ABH 12-JPM
Swap Agreement, shall not exceed $400,000,000;
(d) In the case of each such Person other than Holdings and Irish
Holdings, unsecured intercompany Indebtedness for loans and advances made
by Holdings, Irish Holdings or any Beneficial Owner to a Borrower or a
Guarantor, provided that such intercompany Indebtedness is evidenced by a
promissory note or similar written instrument acceptable to the Agent which
provides that such Indebtedness is subordinated to obligations, liabilities
and undertakings of the holder or owner thereof under the Loan Documents on
terms acceptable to the Agent;
(e) In the case of each such Person other than Holdings and Irish
Holdings, Contingent Obligations of any Borrower in support of any
Subsidiary;
(f) Contingent Obligations of Holdings, Irish Holdings or any Borrower
in support of Indebtedness incurred in connection with the Contribution
Agreement Guaranty;
(g) In the case of Holdings, Irish Holdings and any Borrower,
Contingent Obligations in support of any Subsidiary in connection with an
Eligible Lease pursuant to which such Subsidiary is the lessor; and
(h) Indebtedness incurred by Holdings pursuant to the Contribution
Agreement; provided however, that none of Holdings, Irish Holdings or any
Borrower shall make any payment under the Contribution Agreement to ABH 12
unless the Agent shall be satisfied that the proceeds of each payment under
the Contribution Agreement will be applied by ABH 12 to satisfy its
obligations under the ABH 12-JPM Swap Agreement.
8.5. Transfer of Assets. Sell, lease, transfer or otherwise dispose of
any assets of any Borrower, any Guarantor or any Subsidiary other than (a)
leases of Aircraft under Eligible Leases, (b) sales of Aircraft, or sales of all
of the beneficial interest or ownership of a Beneficial Owner or a Borrower or
(c) Engine swaps, interchange or pooling arrangements to the extent permitted
under any Eligible Lease, provided in each case that (i) the purchaser of such
Aircraft or beneficial interest shall have acknowledged receipt of the
Applicable Borrower's irrevocable instruction to pay the sales price for such
Aircraft or beneficial interest directly to the Collection Account identified in
the Lockbox Agreement to which the Applicable Borrower is a party, (ii) the net
proceeds of such sales are promptly applied in accordance with Section 2.3(b),
and (iii) at the time of any such sale the requirements of Section 2.13 for
release of the respective Borrower or Guarantor have been satisfied;
8.6. Subsidiaries; Investments. Own, create or permit to exist any
Subsidiary (except that a Guarantor may own beneficial interests in, or (subject
to Section 8.4(d)) make advances to, a Borrower or another Guarantor and a
Borrower may own the Applicable Intermediary), or otherwise purchase, own,
invest in or otherwise acquire, directly or indirectly, any stock or other
securities, or make or permit to exist any interest whatsoever in any other
60
Person or permit to exist any loans or advances to any Person, other than loans
referred to in Section 8.4(d);
8.7. Merger or Consolidation. (a) Consolidate with or merge into any
other Person, or (b) permit any other Person to merge into it, or (c) liquidate,
wind-up or dissolve or sell, transfer or lease or otherwise dispose of all or a
substantial part of its assets without the consent of the Agent, except as
permitted by Section 8.5 and except in the case of a Borrower or Guarantor that
simultaneously terminates its status as a Borrower or Guarantor hereunder in
accordance with Section 2.13;
8.8. Transactions with Affiliates. Other than transactions permitted
under Section 8.7, enter into any transaction after the Initial Closing Date,
including, without limitation, the purchase, sale, lease or exchange of
property, real or personal, or the rendering of any service, with any Affiliate
of any Borrower or of any Guarantor, except (a) that such Persons may render
services to a Borrower, a Guarantor or their Subsidiaries for compensation at
the same rates generally paid by Persons engaged in the same or similar
businesses for the same or similar services, (b) that a Borrower, a Guarantor or
any Subsidiary may render services to such Persons for compensation at the same
rates generally charged by such Borrower, such Guarantor or such Subsidiary, (c)
in either case in the ordinary course of business and pursuant to the reasonable
requirements of a Borrower's (or a Guarantor's or any Subsidiary's) business
consistent with past practice of such Borrower or such Guarantor and its
Subsidiaries and upon fair and reasonable terms no less favorable to such
Borrower (or such Guarantor or any Subsidiary) than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate, and (d)
subject to Section 8.18, the Servicer may render the services described in the
Servicing Agreement for the fees set forth therein;
8.9. Employee Benefit Plans; ERISA Affiliates; Employees. Sponsor any
Employee Benefit Plan or any Multiemployer Plan or agree to have any obligation
to fund any such plan, or hire or retain any employee other than officers
thereof;
8.10. Fiscal Year. Change its Fiscal Year, or have any fiscal year
other than the Fiscal Year;
8.11. Dissolution, etc. Wind up, liquidate or dissolve (voluntarily or
involuntarily) or commence or suffer any proceedings seeking any such winding
up, liquidation or dissolution, except in connection with a transaction
permitted pursuant to Section 8.7;
8.12. Change in Control. Cause, suffer or permit to exist or occur any
Change of Control;
8.13. Negative Pledge Clauses. Enter into or cause, suffer or permit
to exist any agreement with any Person other than the Agent and the Lenders
pursuant to this Agreement or any other Loan Documents which prohibits or limits
the ability of any Borrower or any Subsidiary to create, incur, assume or suffer
to exist any Lien upon any of its property, assets or revenues, whether now
owned or hereafter acquired; provided that any Eligible Lease may contain such a
prohibition or limitation so long as the prohibition or limitation does not
apply to any Lien granted in favor of the Agent or any Lender pursuant to the
Loan Documents;
61
8.14. Partnerships. Become a general partner in any general or limited
partnership;
8.15. Business and Operations. Engage in any (i) business or
operations other than the ownership, financing, leasing and sale of Aircraft or
the ownership of a Borrower, a Guarantor or Applicable Intermediary engaged in
such business or operations, or matters reasonably incidental thereto, or the
performance of the Loan Documents, provided, however, that, except as otherwise
provided in Section 2.1(a), no Borrower that owns or is the Applicable Borrower
with respect to any Aircraft may own or be the Applicable Borrower with respect
to any other Aircraft and (ii) business in Bermuda or Ireland other than the
performance of its obligations under the Loan Documents;
8.16. Ownership, Operation and Leasing of Financed Aircraft.
(a) Permit any Person other than a Borrower (or a Beneficial Owner
solely by virtue of its beneficial interest in the respective Borrower) to
own beneficially or of record any Financed Aircraft;
(b) Permit any Financed Aircraft to be leased, subleased or chartered
to any Person other than the Applicable Carrier or the Applicable
Intermediary, or to be operated by any Person other than the Applicable
Borrower or the Applicable Carrier, except as permitted in the Security
Agreement or any Lease;
(c) Permit any Financed Aircraft to be leased to an Eligible Carrier
except under the terms of an Eligible Lease;
(d) Permit any Financed Aircraft to be flown into or located in any
country (or part thereof) if as a result thereof such Financed Aircraft
would not be covered by insurance;
8.17. Servicing Agreements.
(a) Amend, modify or supplement either Servicing Agreement in any
material respect without the consent of the Agent;
(b) Except as otherwise agreed by the Agent, pay any management or
other fee to Holdings, Irish Holdings or any Affiliate other than payment
of servicing fees under either Servicing Agreement to the extent permitted
in the Lockbox Agreement; or
(c) Commit or permit any material breach of either Servicing
Agreement; or
8.18. Representations Regarding Agent and Lenders. Represent or hold
out, or permit any Applicable Carrier to represent or hold out, the Agent or any
Lender as (a) the owner of any Financed Aircraft, (b) carrying goods or
passengers on any such Financed Aircraft, or (c) being in any way responsible
for any operation of carriage (whether for hire or reward or gratuitously) which
may be undertaken by any Borrower, Guarantor, Subsidiary or Applicable Carrier;
or
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8.19. Holdings; Irish Holdings. In the case of Holdings and Irish
Holdings, conduct, transact or otherwise engage in any business or operations
other than those incidental to its voting, equity, beneficial or any other
ownership interests of each Borrower and the performance of the Loan Documents;
or
8.20. Organizational Documents. No Credit Party shall amend its
Organizational Documents without the consent of the Lenders and the Collateral
Agent (as defined in the Security Agreement for such Credit Party).
ARTICLE IX
EVENTS OF DEFAULT AND ACCELERATION
9.1. Events of Default. If any one or more of the following events
(herein called "Events of Default") shall occur for any reason whatsoever (and
whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or pursuant to or in compliance with any judgment,
decree or order of any court or any order, rule or regulation of any
Governmental Authority), that is to say:
(a) if default shall be made in the due and punctual payment of the
principal of any Loan or other Obligation, when and as the same shall be
due and payable whether pursuant to any provision of Article II, at
maturity, by acceleration or otherwise; or
(b) if default shall be made in the due and punctual payment of any
amount of interest on any Loan or other Obligation or of any fees or other
amounts payable to any of the Lenders or the Agent within three (3)
Business Days after the date on which the same shall be due and payable; or
(c) if default shall be made in the performance or observance of any
covenant set forth in Section 7.5, 7.11, 7.12, 7.24 or Article VIII; or
(d) if a default shall be made in the performance or observance of, or
shall occur under, any covenant, agreement or provision contained in this
Agreement (other than as described in clauses (a), (b) or (c) above), or if
a default shall be made in the performance or observance of, or shall occur
under, any covenant, agreement or provision contained in any of the other
Loan Documents (beyond any applicable grace period, if any, contained
therein) or in any instrument or document evidencing or creating any
obligation, guaranty, or Lien in favor of the Agent (acting in any
capacity) or any of the Lenders or delivered to the Agent (acting in any
capacity) or any of the Lenders in connection with or pursuant to this
Agreement or any of the Obligations, and such default shall continue for 30
or more days after the earlier of receipt of notice of such default to an
Authorized Representative from the Agent (acting in any capacity) or an
officer of any Borrower becomes aware of such default, or if any Loan
Document ceases to be in full force and effect (other than by reason of any
action by the Agent (acting in any capacity)), or if without the written
consent of the Lenders, this Agreement or any other Loan Document shall be
disaffirmed or shall terminate, be terminable or be terminated or become
void or unenforceable for any reason whatsoever (other than in accordance
with its terms in the
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absence of default or by reason of any action by the Lenders or the Agent
(acting in any capacity)); or
(e) if there shall occur (i) a default, which is not waived, in the
payment of any principal, interest, premium or other amount with respect to
any Indebtedness or Rate Hedging Obligation (other than the Loans and other
Obligations) of Holdings, Irish Holdings, ABH 12 or any Borrower or any
Subsidiary, or (ii) a default, which is not waived, in the performance,
observance or fulfillment of any term or covenant contained in any
agreement or instrument under or pursuant to which any such Indebtedness or
Rate Hedging Obligation may have been issued, created, assumed, guaranteed
or secured by any Borrower or any Subsidiary, or (iii) any other event of
default as specified in any agreement or instrument under or pursuant to
which any such Indebtedness or Rate Hedging Obligation may have been
issued, created, assumed, guaranteed or secured by Holdings, Irish
Holdings, ABH 12 or any Borrower or any Subsidiary, and such default or
event of default under clause (i), (ii) or (iii) above shall continue for
more than the period of grace, if any, therein specified, or such default
or event of default under clause (i), (ii) or (iii) above shall permit the
holder of any such Indebtedness (or any agent or trustee acting on behalf
of one or more holders) to accelerate the maturity thereof; or
(f) if any representation, warranty or other statement of fact
contained in any Loan Document or in any writing, certificate, report or
statement at any time furnished to the Agent (acting in any capacity) or
any Lender by or on behalf of any Borrower or any other Credit Party
pursuant to or in connection with any Loan Document, or otherwise, shall be
false or misleading in any material respect when given; or
(g) if, taken as a whole, Holdings, Irish Holdings, the Borrowers, the
Subsidiaries and the other Credit Parties shall be unable to pay their
debts generally as they become due; or Holdings, Irish Holdings, any
Borrower, any Subsidiary or other Credit Party shall file a petition to
take advantage of any insolvency statute; make an assignment for the
benefit of its creditors; commence a proceeding for the appointment of a
receiver, trustee, examiner, liquidator or conservator of itself or of the
whole or any substantial part of its property; file a petition or answer
seeking liquidation, reorganization, examination or arrangement or similar
relief under the federal bankruptcy laws or any other applicable law or
statute; or
(h) if a court of competent jurisdiction shall enter an order,
judgment or decree appointing a custodian, receiver, trustee, examiner,
liquidator or conservator of any Borrower, any Subsidiary or other Credit
Party or of the whole or any substantial part of its properties and such
order, judgment or decree continues unstayed and in effect for a period of
sixty (60) days, or approve a petition filed against any Borrower, any
Subsidiary or other Credit Party seeking liquidation, reorganization,
examination or arrangement or similar relief under the federal bankruptcy
laws or any other applicable law or statute of the United States of America
or any state, which petition is not dismissed within sixty (60) days; or
if, under the provisions of any other law for the relief or aid of debtors,
a court of competent jurisdiction shall assume custody or control of any
Borrower, any Subsidiary or other Credit Party or of the whole or any
substantial part of its properties, which control is not relinquished
within sixty (60) days; or if there is
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commenced against any Borrower, any Subsidiary or other Credit Party any
proceeding or petition seeking reorganization, arrangement or similar
relief under the federal bankruptcy laws or any other applicable law or
statute of the United States of America or any state which proceeding or
petition remains undismissed for a period of sixty (60) days; or if any
Borrower, any Subsidiary or other Credit Party takes any action to indicate
its consent to or approval of any such proceeding or petition; or
(i) if any Borrower or any Subsidiary shall, other than in the
ordinary course of business (as determined by past practices), suspend all
or any part of its operations material to the conduct of the business of
any Borrower or such Subsidiary for a period of more than 60 days; or
(j) if this Agreement or any other Loan Document shall for any reason
not be, or be asserted by any Borrower or any other Credit Party or
Subsidiary not to be, a legal, valid and binding obligation of any Borrower
or any Credit Party (as the case may be) enforceable in accordance with its
terms; or
(k) (i) if any Lien of the Agent pursuant to any Loan Document shall
for any reason not be, or be asserted by any Borrower or any other Credit
Party or Subsidiary not to be a valid, first priority perfected Lien on the
Collateral identified therein (except to the extent that such Lien is not
required hereunder or under the Security Agreement to be a valid, first
priority perfected Lien on such Collateral), subject to no other Liens
except Permitted Liens; or (ii) the Contribution Agreement shall for any
reason not be, or be asserted by the Parent, Holdings or any other Credit
Party not to be valid, binding and enforceable against Holdings or any
other Credit Party; or
(l) (i) any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Employee Benefit Plan, (ii) any "accumulated funding deficiency" (as
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Single Employer Plan or any Lien in favor of the PBGC or a
Single Employer Plan shall arise on the assets of any Borrower, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence
to have a trustee appointed, or a trustee shall be appointed, to administer
or to terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a trustee is likely to result
in the termination of such Single Employer Plan for purposes of Title IV of
ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title
IV of ERISA, (v) any Borrower or any ERISA Affiliate shall, or in the
reasonable opinion of the Required Lenders is likely to, incur any
liability in connection with a withdrawal from, or the Insolvency or
Reorganization of, a Multemployer Plan or (vi) any other event or condition
shall occur or exist with respect to a Employee Benefit Plan; and in each
case in clauses (i) through (vi) above, such event or condition, together
with all other such events or conditions, if any, could reasonably be
expected to have a Material Adverse Effect;
then, and in any such event and at any time thereafter, if such Event of Default
or any other Event of Default shall continue to exist and not have been cured or
waived,
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(A) either or both of the following actions may be taken: (i) the
Agent, with the consent of the Required Lenders, may, and at the
direction of the Required Lenders shall, declare any obligation of the
Lenders to make further Loans terminated, whereupon the obligation of
each Lender to make further Loans hereunder shall terminate
immediately, and (ii) the Agent shall at the direction of the Required
Lenders, at their option, declare by notice to the Borrowers any or
all of the Obligations to be immediately due and payable, and the
same, including all interest accrued thereon and all other obligations
of any Borrower to the Agent and the Lenders, shall forthwith become
immediately due and payable without presentment, demand, protest,
notice or other formality of any kind, all of which are hereby
expressly waived, anything contained herein or in any instrument
evidencing the Obligations to the contrary notwithstanding; provided,
however, that notwithstanding the above, if there shall occur an Event
of Default under clause (g) or (h) above, then the obligation of the
Lenders to make Loans hereunder shall automatically terminate and any
and all of the Obligations shall be immediately due and payable
without the necessity of any action by the Agent or the Required
Lenders or notice to the Agent or the Lenders;
(B) each Borrower shall, upon demand of the Agent or the Required
Lenders, promptly cause to be performed at Borrowers' expense by
independent certified public accountants acceptable to the Agent an
audit of all Financed Aircraft; and
(C) the Agent and each of the Lenders shall have all of the
rights and remedies available under the Loan Documents or under any
applicable law, including without limitation all of the rights and
remedies of a secured party under any applicable Uniform Commercial
Code, the FAA Act, the Convention or any other applicable law.
9.2. Agent to Act. In case any one or more Events of Default shall
occur and not have been waived, the Agent may, and at the direction of the
Required Lenders shall, proceed to protect and enforce their rights or remedies
either by suit in equity or by action at law, or both, whether for the specific
performance of any covenant, agreement or other provision contained herein or in
any other Loan Document, or to enforce the payment of the Obligations or any
other legal or equitable right or remedy.
9.3. Cumulative Rights. No right or remedy herein conferred upon the
Lenders or the Agent is intended to be exclusive of any other rights or remedies
contained herein or in any other Loan Document, and every such right or remedy
shall be cumulative and shall be in addition to every other such right or remedy
contained herein and therein or now or hereafter existing at law or in equity or
by statute, or otherwise.
9.4. No Waiver. No course of dealing between any Borrower and any
Lender or the Agent or any failure or delay on the part of any Lender or the
Agent in exercising any rights or remedies under any Loan Document or otherwise
available to it shall operate as a waiver of any rights or remedies and no
single or partial exercise of any rights or remedies shall
66
operate as a waiver or preclude the exercise of any other rights or remedies
hereunder or of the same right or remedy on a future occasion.
9.5. Allocation of Proceeds. If an Event of Default has occurred and
not been waived, and the maturity of the Loans has been accelerated pursuant to
Article IX hereof, all payments received by the Agent hereunder, in respect of
any principal of or interest on the Obligations or any other amounts payable by
any Borrower hereunder, shall be applied by the Agent in the following order (or
in such manner as the Required Lenders may determine):
(a) amounts due to the Lenders pursuant to Sections 2.10 and 11.5;
(b) amounts due to the Agent pursuant to Section 10.8;
(c) payments of interest on Loans, to be applied for the ratable
benefit of the Lenders and amounts due to any of the Lenders in respect of
Obligations consisting of liabilities under the ABH 12-JPM Swap Agreement
and paid from contributions to ABH 12 pursuant to the Contribution
Agreement and the Contribution Agreement Guaranty or any Swap Agreement
with any of the Lenders on a pro rata basis according to the amounts owed;
(d) payments of principal of Loans, to be applied for the ratable
benefit of the Lenders;
(e) amounts due to the Lenders pursuant to Sections 7.15 and 11.9;
(f) payments of all other amounts due under any of the Loan Documents,
if any, to be applied for the ratable benefit of the Lenders; and
(g) any surplus remaining after application as provided for herein, to
any Borrower or otherwise as may be required by applicable law.
9.6. Activities of Eligible Carriers. Notwithstanding anything
contained in this Agreement or any other Loan Document, the Credit Parties shall
not be deemed to be in breach of their respective obligations hereunder or
thereunder with respect to the care, maintenance, alteration, possession,
return, replacement, pooling, subleasing, use or operation of any Financed
Aircraft or any part thereof subject to an Eligible Lease by virtue of a default
by the Applicable Carrier under such Eligible Lease so long as each of the
following conditions is satisfied:
(a) such default by the Applicable Carrier is not within the control
of any Credit Party;
(b) the Credit Parties are in compliance with Section 7.19; and
(c) such default does not relate to any use or location of an Aircraft
in any jurisdiction that constitutes an Event of Default hereunder, any
failure to make any payment required by this Agreement or any other Loan
Document when due hereunder or thereunder, or any failure to maintain any
insurance required under this Agreement or any
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other Loan Document, any failure to maintain perfection of the Agent's Lien
on any Collateral.
ARTICLE X
THE AGENT
10.1. Appointment, Powers, and Immunities. Each Lender hereby
irrevocably appoints and authorizes the Agent to act as its agent under this
Agreement and the other Loan Documents, as "Mortgagee" under each Security
Agreement and as "Security Agent" under each Lockbox Agreement (references in
this Article X to the term "Agent" being deemed to include as well such other
capacities), with such powers and discretion as are specifically delegated to
the Agent by the terms of this Agreement and the other Loan Documents, together
with such other powers as are reasonably incidental thereto. The Agent (which
term as used in this sentence and in Section 10.5 and the first sentence of
Section 10.6 hereof shall include its affiliates and its own and its affiliates'
officers, directors, employees, and agents):
(a) shall not have any duties or responsibilities except those
expressly set forth in the Loan Documents and shall not be a trustee or
fiduciary for any Lender;
(b) shall not be responsible to the Lenders for any recital,
statement, representation, or warranty (whether written or oral) made in or
in connection with any Loan Document or any certificate or other document
referred to or provided for in, or received by any of them under, any Loan
Document, or for the value, validity, effectiveness, genuineness,
enforceability, or sufficiency of any Loan Document, or any other document
referred to or provided for therein or for any failure by any Credit Party
or any other Person to perform any of its obligations thereunder;
(c) shall not be responsible for or have any duty to ascertain,
inquire into, or verify the performance or observance of any covenants or
agreements by any Credit Party or the satisfaction of any condition or to
inspect the property (including the books and records) of any Credit Party
or any of its Subsidiaries or affiliates;
(d) shall not be required to initiate or conduct any litigation or
collection proceedings under any Loan Document; and
(e) shall not be responsible for any action taken or omitted to be
taken by it under or in connection with any Loan Document, except for its
own gross negligence or willful misconduct.
The Agent may employ agents and attorneys-in-fact and shall not be responsible
for the negligence or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care.
10.2. Reliance by Agent. The Agent shall be entitled to rely upon any
certification, notice, instrument, writing, or other communication (including,
without limitation, any thereof by telephone or facsimile) believed by it to be
genuine and correct and to have been signed, sent or made by or on behalf of the
proper Person or Persons, and upon advice and
68
statements of legal counsel (including counsel for any Credit Party),
independent accountants, and other experts selected by the Agent. The Agent may
deem and treat the payee of any Note as the holder thereof for all purposes
hereof unless and until the Agent receives and accepts an Assignment and
Acceptance executed in accordance with Section 11.1 hereof. As to any matters
not expressly provided for by the Loan Documents, the Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required Lenders, and such
instructions shall be binding on all of the Lenders; provided, however, that the
Agent shall not be required to take any action that exposes the Agent to
personal liability or that is contrary to any Loan Document or applicable law or
unless it shall first be indemnified to its satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of
taking any such action.
10.3. Defaults. The Agent shall not be deemed to have knowledge or
notice of the occurrence of a Default or Event of Default unless the Agent has
received written notice from a Lender or a Borrower specifying such Default or
Event of Default and stating that such notice is a "Notice of Default". In the
event that the Agent receives such a notice of the occurrence of a Default or
Event of Default, the Agent shall give prompt notice thereof to the Lenders. The
Agent shall (subject to Section 10.2 hereof) take such action with respect to
such Default or Event of Default as shall reasonably be directed by the Required
Lenders, provided that, unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the Lenders.
10.4. Rights as Lender. With respect to its Revolving Credit
Commitment and the Loans made by it, JPMCB (and any successor acting as Agent)
in its capacity as a Lender hereunder shall have the same rights and powers
hereunder as any other Lender and may exercise the same as though it were not
acting as the Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Agent in its individual capacity. The
Agent and its affiliates may (without having to account therefor to any Lender)
accept deposits from, lend money to, make investments in, provide services to,
and generally engage in any kind of lending, trust, or other business with any
Credit Party or any of its Subsidiaries or affiliates as if it were not acting
as Agent, and JPMCB (and any successor acting as Agent) and its affiliates may
accept fees and other consideration from any Credit Party or any of its
Subsidiaries or affiliates for services in connection with this Agreement or
otherwise without having to account for the same to the Lenders.
10.5. Indemnification. The Lenders agree to indemnify the Agent (to
the extent not reimbursed under Section 11.9 hereof, but without limiting the
obligations of any Borrower under such Section) ratably in accordance with their
respective Revolving Credit Commitments, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including reasonable attorneys' fees), or disbursements of any kind
and nature whatsoever that may be imposed on, incurred by or asserted against
the Agent (including by any Lender) in any way relating to or arising out of any
Loan Document or the transactions contemplated thereby or any action taken or
omitted by the Agent under any Loan Document; provided that no Lender shall be
liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the Person to be indemnified. Without
limitation of
69
the foregoing, each Lender agrees to reimburse the Agent promptly upon demand
for its ratable share of any costs or expenses payable by any Borrower under
Section 11.5, to the extent that the Agent is not promptly reimbursed for such
costs and expenses by any Borrower. The agreements contained in this Section
10.5 shall survive payment in full of the Loans and all other amounts payable
under this Agreement.
10.6. Non-Reliance on Agent and Other Lenders. Each Lender agrees that
it has, independently and without reliance on the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis of the Credit Parties and their Subsidiaries and decision to
enter into this Agreement and that it will, independently and without reliance
upon the Agent or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under the Loan Documents. Except for
notices, reports, and other documents and information expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition, or business of any
Credit Party or any of its Subsidiaries or affiliates that may come into the
possession of the Agent or any of its affiliates.
10.7. Resignation of Agent. The Agent may resign at any time by giving
notice thereof to the Lenders and the Borrowers. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent, subject (so
long as no Default or Event of Default has occurred and is continuing) to the
written consent of an Authorized Representative, which consent shall not be
unreasonably withheld. If no successor Agent shall have been so appointed by the
Required Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent which
shall be a commercial bank organized under the laws of the United States of
America having combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor, such successor
shall thereupon succeed to and become vested with all the rights, powers,
discretion, privileges, and duties of the retiring Agent, and the retiring Agent
shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this Article
X shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
10.8. Fees. The Borrowers agree, jointly and severally, to pay to the
Agent, for its individual account, an Agent's fee as from time to time agreed to
by any Borrower and the Agent in writing.
ARTICLE XI
MISCELLANEOUS
11.1. Assignments and Participations. (a) Each Lender may assign to
one or more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Loans, its Note, and its Revolving Credit Commitment); provided, however, that
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(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender or an
assignment of all of a Lender's rights and obligations under this
Agreement, any such partial assignment shall be in an amount at least
equal to $5,000,000 or an integral multiple of $1,000,000 in excess
thereof;
(iii) each such assignment by a Lender shall be of a constant,
and not varying, percentage of all of its rights and obligations under
this Agreement; and
(iv) the parties to such assignment shall execute and deliver to
the Agent for its acceptance an Assignment and Acceptance in the form
of Exhibit B hereto, together with any Note subject to such assignment
and a processing fee of $3,500 (which amount shall not be payable by
any Borrower);
(v) except in the case of an assignment to another Lender, any
assignment of all or any portion of the Revolving Credit Commitment
shall require the consent of the Agent and, unless a Default or Event
of Default has occurred and is continuing, an Authorized
Representative, such consent in each case not to be unreasonably
withheld; and
(vi) neither any Borrower nor Holdings nor Irish Holdings shall
incur any greater expense or liabilities (including, without
limitation, indemnities and increased costs) than it would have
incurred had such assignment not taken place.
Upon execution, delivery, and acceptance of such Assignment and Acceptance, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Lender hereunder and
the assigning Lender shall, to the extent of such assignment, relinquish its
rights and be released from its obligations under this Agreement. Upon the
consummation of any assignment pursuant to this Section, the assignor, the Agent
and the Borrowers shall make appropriate arrangements so that, if required, new
Notes are issued to the assignor and the assignee. If the assignee is a Non-U.S.
Lender, it shall deliver to the Borrowers and the Agent certification as to
exemption from deduction or withholding of Taxes in accordance with Section 4.6.
(b) The Agent shall maintain at its address referred to in Section
11.2 a copy of each Assignment and Acceptance delivered to and accepted by
it and a register for the recordation of the names and addresses of the
Lenders and the Revolving Credit Commitment of, and principal amount of the
Loans owing to, each Lender from time to time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection
by any Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
(c) Upon its receipt of an Assignment and Acceptance executed by the
parties thereto, together with any Note subject to such assignment and
payment of the processing
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fee, the Agent shall, if such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit B hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt notice thereof to the parties thereto.
(d) Each Lender may sell participations to one or more Persons in all
or a portion of its rights, obligations or rights and obligations under
this Agreement (including all or a portion of its Revolving Credit
Commitment or its Loans); provided, however, that (i) such Lender s
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the participant shall be entitled to
the benefit of the yield protection provisions contained in Article IV and
the right of set-off contained in Section 11.3, (iv) no Borrower shall have
any greater obligation to a participant than it would have had to such
Lender in the absence of the existence of such participant and (v) each
Borrower shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement,
and such Lender shall retain the sole right to enforce the obligations of
any Borrower relating to its Loans and to approve any amendment,
modification, or waiver of any provision of this Agreement (other than
amendments, modifications, or waivers decreasing the amount of principal of
or the rate at which interest or fees are payable on such Loans, extending
any scheduled principal payment date or date fixed for the payment of
interest on such Loans, releasing all or substantially all of the
Collateral (except for a release of Collateral in accordance with Section
2.13), releasing any Guarantor (except for a release of a Guarantor in
accordance with Section 2.13), or extending or increasing its Revolving
Credit Commitment).
(e) Notwithstanding any other provision set forth in this Agreement,
any Lender may at any time assign and pledge all or any portion of its
Loans to any Federal Reserve Bank as collateral security pursuant to
Regulation A and any Operating Circular issued by such Federal Reserve
Bank. No such assignment shall release the assigning Lender from its
obligations hereunder.
(f) Any Lender may furnish any information concerning any Borrower or
any of its Subsidiaries in the possession of such Lender from time to time
to assignees and participants (including prospective assignees and
participants), subject, however, to the provisions of Section 11.15.
11.2. Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid by certified or registered mail, return
receipt requested, or, in the case of telecopy notice, when received, addressed
as follows in the case of Holdings, Irish Holdings, the Borrowers and the Agent,
and as set forth in an administrative questionnaire delivered to the Agent in
the case of the Lenders, or to such other address as may be hereafter notified
by the respective parties hereto
(a) if to Holdings or any Borrower:
to Holdings or such Borrower
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c/o Aircastle Advisor LLC
000 Xxxxx Xxxxxxxx Xxxxx - Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Lease Management
E-Mail: xxxxxxxxxxxxxxx@xxxxxxxxxxxx.xxx
Facsimile Number: (000) 000-0000
Confirmation Number: (000) 000-0000
(b) if to Irish Holdings or any Borrower organized under the laws of
Ireland:
c/o Aircastle Advisor (Ireland) Limited
Xxxxxxxxx Xxxxxxxx Xxxx
Xxxxxx, Xx. Xxxxx, Xxxxxxx
Telephone: 000-000-0-000-0000
Facsimile: 011-353-1-877-2750
with a copy to:
Aircastle Advisor LLC
000 Xxxxx Xxxxxxxx Xxxxx - Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Lease Management
E-Mail: xxxxxxxxxxxxxxx@xxxxxxxxxxxx.xxx
Facsimile Number: (000) 000-0000
Confirmation Number: (000) 000-0000
(c) if to the Agent:
JPMorgan Chase Bank, N.A.
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Electronic Mail: Xxxxxxx.x.xxxx@xxxxxxxx.xxx
with a copy to:
JPMorgan Chase Bank, N.A
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Electronic Mail: Xxxxx.xxxxxxx@xxxxxxxx.xxx
00
(x) if to any other Credit Party, at the address set forth on the
signature page of the Facility Guaranty or Security Instrument executed by
such Credit Party, as the case may be.
11.3. Right of Set-off; Adjustments.
(a) Upon the occurrence and during the continuance of any Event of
Default, each Lender (and each of its affiliates) is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time
owing by such Lender (or any of its affiliates) to or for the credit or the
account of any Borrower against any and all of the obligations of any
Borrower now or hereafter existing under this Agreement and the Note held
by such Lender, irrespective of whether such Lender shall have made any
demand under this Agreement or such Note and although such obligations may
be unmatured. Each Lender agrees promptly to notify the applicable Borrower
after any such set-off and application made by such Lender; provided,
however, that the failure to give such notice shall not affect the validity
of such set-off and application. The rights of each Lender under this
Section 11.3 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) that such Lender may have.
(b) If any Lender (a "benefitted Lender") shall at any time receive
any payment of all or part of the Loans owing to it, or interest thereon,
or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, or otherwise), in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in
respect of such other Lender's Loans owing to it, or interest thereon, such
benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loans
owing to it, or shall provide such other Lenders with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause
such benefitted Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; provided, however,
that if all or any portion of such excess payment or benefits is thereafter
recovered from such benefitted Lender, such purchase shall be rescinded,
and the purchase price and benefits returned, to the extent of such
recovery, but without interest. Each Borrower agrees that any Lender so
purchasing a participation from a Lender pursuant to this Section 11.3 may,
to the fullest extent permitted by law, exercise all of its rights of
payment (including the right of set-off) with respect to such participation
as fully as if such Person were the direct creditor of the Borrowers in the
amount of such participation.
11.4. Survival. All covenants, agreements, representations and
warranties made herein shall survive the making by the Lenders of the Loans and
the execution and delivery to the Lenders of this Agreement and any Notes and
shall continue in full force and effect so long as any of Obligations remain
outstanding or any Lender has any Loan hereunder or any Borrower has continuing
obligations hereunder unless otherwise provided herein. Whenever in this
Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and permitted assigns of such party and all
covenants, provisions and agreements
74
by or on behalf of any Borrower which are contained in the Loan Documents shall
inure to the benefit of the successors and permitted assigns of the Lenders or
any of them.
11.5. Expenses. Holdings, Irish Holdings and each Borrower agree,
jointly and severally, to pay on demand (subject, in the case of preparation,
execution, delivery and administration costs, to the Fee Letter), all reasonable
costs and expenses of the Agent in connection with the preparation, execution,
delivery, administration, modification, and amendment of this Agreement, the
other Loan Documents, subject to any cap that may have otherwise been agreed,
and the other documents to be delivered hereunder, including, without
limitation, the reasonable fees and expenses of counsel for the Agent (excluding
the cost of internal counsel) with respect thereto and with respect to advising
the Agent as to its rights and responsibilities under the Loan Documents.
Holdings, Irish Holdings and each Borrower further agree, jointly and severally,
to pay on demand all costs and expenses of the Agent and the Lenders, if any
(including, without limitation, reasonable external attorneys' fees and
expenses), in connection with the enforcement (whether through negotiations,
legal proceedings, or otherwise) of the Loan Documents and the other documents
to be delivered hereunder.
11.6. Amendments and Waivers. Any provision of this Agreement or any
other Loan Document may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed by the Borrowers and each Lender (and, if
Article X or the rights or duties of the Agent are affected thereby, by the
Agent);
No notice to or demand on any Borrower in any case shall entitle such
Borrower or any other Borrower to any other or further notice or demand in
similar or other circumstances, except as otherwise expressly provided herein.
No delay or omission on any Lender's or the Agent's part in exercising any
right, remedy or option shall operate as a waiver of such or any other right,
remedy or option or of any Default or Event of Default.
11.7. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such fully-executed counterpart.
11.8. Return of Funds. If after receipt of any payment of all or any
part of the Obligations, any Lender is for any reason compelled to surrender
such payment to any Person because such payment is determined to be void or
voidable as a preference, impermissible setoff, a diversion of trust funds or
for any other reason, this Agreement shall continue in full force and each
Borrower, jointly and severally, shall be liable to, and shall indemnify and
hold the Agent or such Lender harmless for, the amount of such payment
surrendered until the Agent or such Lender shall have been finally and
irrevocably paid in full. The provisions of the foregoing sentence shall be and
remain effective notwithstanding any contrary action which may have been taken
by the Agent or the Lenders in reliance upon such payment, and any such contrary
action so taken shall be without prejudice to the Agent or the Lenders' rights
under this Agreement and shall be deemed to have been conditioned upon such
payment having become final and irrevocable.
75
11.9. Indemnification; Limitation of Liability.
(a) Holdings, Irish Holdings and each Borrower, jointly and severally,
agree to indemnify and hold harmless the Agent (which term for purposes of
this Section 11.9 includes the "Mortgagee" under each Security Agreement
and the "Security Agent" under each Lockbox Agreement) and each Lender and
each of their affiliates and their respective officers, directors,
employees, agents, and advisors (each, an "Indemnified Party") from and
against any and all claims, damages, losses, liabilities, costs, and
expenses (including, without limitation, reasonable external attorneys'
fees, but excluding principal and accrued interest on any Loan) that may be
incurred by or asserted or awarded against any Indemnified Party, in each
case arising out of or in connection with or by reason of (including,
without limitation, in connection with any investigation, litigation, or
proceeding or preparation of defense in connection therewith) the Loan
Documents, any of the transactions contemplated herein, any Aircraft or
other Collateral, any possession, performance, transportation, management,
sale, ownership, registration, mortgage, charging, control, maintenance,
service, repair, design, testing, defect, overhaul, purchase, bearing, use
or operation of any Aircraft or other Collateral, or the actual or proposed
use of the proceeds of the Loans, except to the extent such claim, damage,
loss, liability, cost, or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct. In the case of
an investigation, litigation or other proceeding to which the indemnity in
this Section 11.9 applies, such indemnity shall be effective whether or not
such investigation, litigation or proceeding is brought by Holdings, Irish
Holdings, any Borrower, its directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified Party is otherwise
a party thereto and whether or not the transactions contemplated hereby are
consummated. Holdings, Irish Holdings and each Borrower agree that no
Indemnified Party shall have any liability (whether direct or indirect, in
contract or tort or otherwise) to it, any of its Subsidiaries, any
Guarantor or any security holders or creditors thereof arising out of,
related to or in connection with the transactions contemplated in any Loan
Document, except to the extent that such liability directly results from
such Indemnified Party's gross negligence or willful misconduct. Holding,
Irish Holdings and each Borrower agree not to assert any claim against the
Agent, any Lender, any of their affiliates, or any of their respective
directors, officers, employees, attorneys, agents, and advisers, on any
theory of liability, for special, indirect, consequential, or punitive
damages arising out of or otherwise relating to the Loan Documents, any of
the transactions contemplated herein or the actual or proposed use of the
proceeds of the Loans.
(b) Without prejudice to the survival of any other agreement of
Holdings, Irish Holdings or any Borrower hereunder, the agreements and
obligations of Holdings, Irish Holdings and each Borrower contained in this
Section 11.9 shall survive the payment in full of the Loans and all other
amounts payable under this Agreement.
(c) Except as expressly provided herein, each Lender, each Borrower
and the Agent agree that this Agreement and each other Loan Document
entered into by a Holdings Subsidiary Trust is executed by a Qualified
Trustee, not individually but solely as Trustee under a Trust Agreement in
the exercise of the power and authority conferred
76
and vested in it as such Trustee, that each and all of the representations,
undertakings and agreements by a Qualified Trustee, or for the purpose or
with the intention of binding a Qualified Trustee, are made and intended
for the purpose of binding only the Trust Estates (and, to the extent any
Lender, Borrower or Agent has an interest therein, any liability insurance
proceeds), and that in no case whatsoever shall any Qualified Trustee be
personally liable for any loss in respect of such representations,
undertakings and agreements, that nothing herein contained shall be
construed as creating any liability on any Qualified Trustee individually
or personally, to perform any covenant, either express or implied, herein,
all such liability, if any, being expressly waived by each Lender, each
Borrower and the Agent and by each and every Person now or hereafter
claiming by, through or under such Persons except with respect to the gross
negligence or willful misconduct of such Qualified Trustee or for any Liens
on the Collateral arising from, through or under such Qualified Trustee in
its individual capacity, and that so far as any Qualified Trustee,
individually or personally is concerned, each Lender, each Borrower and the
Agent and any Person claiming by, through or under such Persons shall look
solely, except as provided above, to the Trust Estates (and, to the extent
any Lender, Borrower or Agent has an interest therein, any liability
insurance proceeds), for the performance of any obligation under this
Credit Agreement and the other Loan Documents. The term "Trustee" as used
in this Section 11.9(c) shall include any Qualified Trustee succeeding a
Qualified Trustee, as trustee under a Trust Agreement. Any obligation of
any Holdings Subsidiary Trust hereunder or under the other Loan Documents
may be performed by a Beneficial Owner, and any such performance shall not
be construed as revocation of the trust created by any Trust Agreement.
11.10. Severability. If any provision of this Agreement or the other
Loan Documents shall be determined to be illegal or invalid as to one or more of
the parties hereto, then such provision shall remain in effect with respect to
all parties, if any, as to whom such provision is neither illegal nor invalid,
and in any event all other provisions hereof shall remain effective and binding
on the parties hereto.
11.11. Entire Agreement. This Agreement, together with the other Loan
Documents, constitutes the entire agreement among the parties with respect to
the subject matter hereof and supersedes all previous proposals, negotiations,
representations, and other communications between or among the parties, both
oral and written, with respect thereto.
11.12. Payments. All principal, interest, and other amounts to be paid
by any Borrower under this Agreement and the other Loan Documents shall be paid
to the Agent at the Principal Office in Dollars and in immediately available
funds, without setoff, deduction or counterclaim. Subject to the definition of
"Interest Period" herein, whenever any payment under this Agreement or any other
Loan Document shall be stated to be due on a day that is not a Business Day,
such payment may be made on the next succeeding Business Day, and such extension
of time in such case shall be included in the computation of interest and fees,
as applicable, and as the case may be.
11.13. Confidentiality. The Agent and each Lender (each, a "Lending
Party") agrees to keep confidential any information furnished or made available
to it by Holdings, Irish Holdings or any Affiliate of Holdings or Irish Holdings
pursuant to or in connection with this
77
Agreement or the other Loan Documents; provided that nothing herein shall
prevent any Lending Party from disclosing such information (a) to any other
Lending Party or any affiliate of any Lending Party, or any officer, director,
employee, agent, or advisor of any Lending Party or affiliate or any Lending
Party, (b) to any other Person if reasonably incidental to the administration of
the credit facility provided herein, (c) as required by any law, rule, or
regulation, (d) upon the order of any court or administrative agency, (e) upon
the request or demand of any regulatory agency or authority, (f) that is or
becomes available to the public or that is or becomes available to any Lending
Party other than as a result of a disclosure by any Lending Party prohibited by
this Agreement, (g) in connection with any litigation to which such Lending
Party or any of its affiliates may be a party, (h) to the extent necessary in
connection with the exercise of any remedy under this Agreement or any other
Loan Document, and (i) subject to provisions substantially similar to those
contained in this Section, to any actual or proposed participant or assignee.
11.14. Governing Law; Waiver of Jury Trial.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
(b) HOLDINGS, IRISH HOLDINGS AND EACH BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY AGREES AND CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE
INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX XXXX,
XXXXX XX XXX XXXX, XXXXXX XXXXXX OF AMERICA AND, BY THE EXECUTION AND DELIVERY
OF THIS AGREEMENT, HOLDINGS AND EACH BORROWER EXPRESSLY WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN, OR TO THE EXERCISE
OF JURISDICTION OVER IT AND ITS PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT,
ACTION OR PROCEEDING, AND HOLDINGS AND EACH BORROWER HEREBY IRREVOCABLY SUBMITS
GENERALLY AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH
SUIT, ACTION OR PROCEEDING.
(c) HOLDINGS, IRISH HOLDINGS AND EACH BORROWER AGREES THAT SERVICE OF
PROCESS MAY BE MADE BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT
OR OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED
OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF HOLDINGS OR SUCH BORROWER
PROVIDED IN SECTION 11.2, OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER
THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NEW YORK.
(d) NOTHING CONTAINED IN SUBSECTIONS (A) OR (B) HEREOF SHALL PRECLUDE
THE AGENT OR ANY LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO ANY LOAN DOCUMENT IN THE COURTS OF ANY OTHER JURISDICTION. TO
THE EXTENT
78
PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, HOLDINGS, IRISH
HOLDINGS AND EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY
SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR
PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY
BY ANY SUCH OTHER COURT OR COURTS WHICH NOW OR HEREAFTER MAY BE AVAILABLE UNDER
APPLICABLE LAW.
(e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR
REMEDIES UNDER OR RELATED TO ANY LOAN DOCUMENT OR ANY AMENDMENT, INSTRUMENT,
DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN
CONNECTION THEREWITH, HOLDINGS, IRISH HOLDINGS, THE BORROWERS, THE AGENT AND THE
LENDERS HEREBY AGREE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH
ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND
HEREBY IRREVOCABLY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING.
11.15. USA PATRIOT Act. Each Lender hereby notifies Holdings, Irish
Holdings and each Borrower that pursuant to the requirements of the USA Patriot
Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
"Act"), it is required to obtain, verify and record information that identifies
each Borrower, which information includes the name and address of such Borrower
and other information that will allow such Lender to identify each Borrower in
accordance with the Act.
79
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be made, executed and delivered by their duly authorized officers as of the day
and year first above written.
AIRCASTLE INVESTMENT HOLDINGS LIMITED
AIRCASTLE IRELAND NO. 1 LIMITED
ABH 12 LIMITED
AIRCASTLE BERMUDA HOLDING II LIMITED
AIRCASTLE BERMUDA HOLDING III LIMITED
AIRCASTLE BERMUDA HOLDING VII LIMITED
AIRCASTLE BERMUDA HOLDING VIII LIMITED
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------------
Name: Xxxxx X. Xxxxxx
-----------------------------------------
Title: General Counsel and Assistant Secretary
----------------------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
CONSTELLATION AIRCRAFT LEASING (FRANCE)
SARL
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
------------------------------
Title: Attorney in Fact
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
INTREPID AIRCRAFT LEASING (FRANCE) SARL
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
------------------------------
Title: Attorney in Fact
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
CONSTITUTION AIRCRAFT LEASING (IRELAND)
LIMITED
By: /s/ Xxx Xxxxxxxx
------------------------------------
Name: Xxx Xxxxxxxx
------------------------------
Title:
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
XXXXX FARGO BANK NORTHWEST, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Owner Trustee
under the Trust Agreements to which it
is a party
By: /s/ Xxx X. Xxxxx
------------------------------------
Name: Xxx X. Xxxxx
------------------------------
Title: Vice President
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee under the Trust
Agreements to which it is a party
By: /s/ Xxx X. Xxxxx
------------------------------------
Name: Xxx X. Xxxxx
------------------------------
Title: Vice President
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
JPMORGAN CHASE BANK, N.A., as Agent and
as a Lender
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------------
Title: Managing Director
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
BEAR XXXXXXX CORPORATE LENDING INC.,
as a Lender
By: /s/ Xxxxxx Xxxxxxxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxxxxxxx
------------------------------
Title: Vice President
-----------------------------
Signature Page to the Aircastle Third Amended and Restated Credit Agreement
EXHIBIT N
Form of Parent Support Agreement
SECOND AMENDED AND RESTATED PARENT SUPPORT AGREEMENT
October 24, 2005
TO: JPMORGAN CHASE BANK, N.A. in its capacity as agent for the Lenders under
the Credit Agreement referred to herein (in such capacity, and together
with any successor agent appointed in accordance with the terms of such
Credit Agreement, the "Agent").
Ladies and Gentlemen:
(a) In order to induce the Agent and the Lenders to enter into the
Third Amended and Restated Credit Agreement, dated as of October 24, 2005 (as
may be further amended, modified or restated from time to time, the "Credit
Agreement") among certain Holdings Subsidiary Trusts and Holdings SPCs
designated as Borrowers thereunder, the Lenders and the Agent, Aircastle
Investment Limited, an exempted company organized and existing under the laws of
Bermuda ("Parent"), hereby agrees (i) not to commence any "case" (as defined in
Title 11 of the United States Code) against any Credit Party and also agrees not
to cause or permit a Credit Party to commence any such "case", (ii) to cause
each Credit Party to comply with the provisions of Section 2.3(b)(i) and Article
VIII of the Credit Agreement and (iii) in connection with the ABH 12 Swap
Agreement to cause ABH 12 to deliver to the counterparty thereto any collateral
required thereunder.
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original and all of which shall constitute one and the same
instrument.
This Agreement shall be binding upon the successors and assigns of the
Parent and shall be governed, construed, applied and enforced in accordance with
the internal laws of the State of New York, and no defense given or allowed by
the laws of any other state or country shall be interposed in any action hereon
unless such defense is given or allowed by the laws of the State of New York.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Aircastle Investment Limited has executed and
delivered this letter as of the day and year first above written.
AIRCASTLE INVESTMENT LIMITED
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
