ENGINE AND SPARE PARTS SECURITY AGREEMENT
This ENGINE AND SPARE PARTS SECURITY AGREEMENT (as amended, restated,
supplemented, or otherwise modified from time to time, this "Agreement") is
entered into as of June 2, 2005, by and between HAWAIIAN AIRLINES, INC., a
Delaware corporation ("Grantor"), and CANYON CAPITAL ADVISORS LLC, a Delaware
limited liability company, in its capacity as agent for the below-defined Lender
Group (in such capacity, together with its successors, if any, in such capacity,
"Agent"), with reference to the following:
WHEREAS, Hawaiian Holdings, Inc., a Delaware corporation, and Grantor,
as borrower, are parties to that certain Credit Agreement, dated
contemporaneously herewith (as amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"), with the Lender Group,
pursuant to which the Lender Group has agreed to make certain financial
accommodations to Grantor;
WHEREAS, Grantor is a party to that certain Security Agreement, dated
contemporaneously herewith (as amended, restated, supplemented or otherwise
modified from time to time, the "Security Agreement"), with Agent, pursuant to
which Grantor has granted to Agent, for the benefit of the Lender Group, a
security interest in substantially all of its assets; and
WHEREAS, Agent has agreed to act as agent for the Lender Group in
connection with the transactions contemplated by this Agreement; and
WHEREAS, to induce the Lender Group to make the financial
accommodations provided to Grantor pursuant to the Credit Agreement, Grantor
desires to pledge, grant, transfer, and assign to Agent, for the benefit of the
Lender Group, a security interest in the below-defined Collateral to secure the
payment and performance of the Secured Obligations, as provided herein.
NOW THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and each intending
to be bound hereby, Agent and Grantor agree as follows:
1. DEFINITIONS AND CONSTRUCTION.
1.1. DEFINITIONS. Each initially capitalized term used herein and not
defined herein shall have the meaning ascribed to such term in the Credit
Agreement. As used in this Agreement, the following terms shall have the
following definitions:
"Agent" has the meaning specified therefor in the preamble hereto.
"Agreement" has the meaning specified therefor in the preamble hereto.
"Bankruptcy Code" means title 11 of the United States Code, as in
effect from time to time.
"Code" means the New York Uniform Commercial Code, as in effect from
time to time; provided, however, that in the event that, by reason of mandatory
provisions of law, any or all of the attachment, perfection, priority, or
remedies with respect to Agent's Liens on any Collateral is governed by the
Uniform Commercial Code as enacted and in effect in a jurisdiction other than
the State of New York, the term "Code" shall mean the Uniform Commercial Code as
enacted and in effect in such other jurisdiction solely for purposes of the
provisions thereof relating to such attachment, perfection, priority, or
remedies.
"Collateral" means and includes each and all of the following (subject
to Section 2.1(b)):
(i) the Engines;
(ii) the Spare Parts;
(iii) all right, title and interest of Grantor (in its capacity as
a lessor or in a similar capacity) in and to any lease, rental agreement,
charter agreement, or other agreement now or hereafter executed with respect to
any Engine or Spare Part, including, but not limited to, Grantor's right to
receive, either directly or indirectly, from any party or person, any rents or
other payments due under each such agreement;
(iv) all purchase agreements, support agreements, and bills of sale
with respect to any Engine or Spare Part;
(v) all warranties, indemnities or agreements, express or implied,
regarding title, materials, workmanship, design, specifications, performance,
maintenance or patent infringement or otherwise in respect of any Engine or
Spare Part;
(vi) all repair, maintenance and inventory records, logs, manuals
and all other documents and materials similar thereto (including any such
records, logs, manuals, documents and materials that are in electronic format or
are computer print-outs or storage) at any time maintained, created or used by
Grantor in respect of any Engine or Spare Part (including all records, logs,
documents, airworthiness releases, serviceability tags and other materials
required at any time to be maintained by Grantor pursuant to the Grantor's
Maintenance Program); and
(vii) all of the proceeds and products, whether tangible or
intangible, of, and any general intangibles (including payment intangibles)
related to, any of the foregoing, including proceeds of insurance (exclusive of
liability insurance) or commercial tort claims covering or relating to any or
all of the foregoing, and any and all accounts, books, chattel paper, deposit
accounts, equipment, general and payment intangibles, inventory, investment
related property, negotiable collateral, supporting obligations, money, or other
tangible or intangible property, in each case resulting from the sale, lease,
license, exchange, collection, or other disposition of any of the foregoing, the
proceeds of any award in condemnation with respect to any of the property of
Grantor, any rebates or refunds, whether for taxes or otherwise, and all
proceeds of any such proceeds, or any portion thereof or interest therein, and
the proceeds thereof, and all proceeds of any loss of, damage to, or destruction
of the above, whether insured or not insured, and, to the extent not otherwise
included, any indemnity, warranty, or guaranty
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payable by reason of loss or damage to, or otherwise with respect to any of the
foregoing Collateral.
"Credit Agreement" has the meaning specified therefor in the recitals
hereto.
"Engines" means and includes each and all of the aircraft engines (as
defined in Section 40102 of the Transportation Code) whether now owned or
hereafter acquired by Grantor and including those Engines identified on Schedule
1.1(E) annexed hereto, as such Schedule may be supplemented from time to time by
a Supplemental Schedule thereto.
"Event of Default" has the meaning specified therefor in Section 5 of
this Agreement.
"Event of Loss" means (a) the actual, constructive, compromised,
arranged or agreed total loss of any Engines or Spare Parts, (b) the destruction
or damage beyond economic repair of any Engine or Spare Part or any Engine or
Spare Part being rendered unfit for normal use by Grantor for any reason
whatsoever and beyond economic repair, (c) any Engine or Spare Part being
condemned, confiscated or requisitioned for use by any Governmental Authority
for more than 30 days, or title thereto being requisitioned or otherwise
compulsorily acquired by any Governmental Authority, (d) any Engine or Spare
Part being stolen, seized or lost for more than 30 days, or (e) the use of any
Engine or Spare Part by Grantor in its normal operations shall have been
prohibited by any Governmental Authority for more than 6 months as a result of
any rule, regulation, order or other action thereof.
"Expendables" means those spare parts for which no FAA and original
equipment manufacturer authorized refurbishment procedure exists or for which
cost of repair or refurbishment would normally exceed that of replacement.
"FAA" means and refers to the Federal Aviation Administration of the
United States Department of Transportation, or any successor or replacement
administration or governmental agency having the same or similar authority and
responsibilities.
"FAA Release" has the meaning specified therefore in Section 2.5.
"FARs" means the rules and regulations of the FAA, including as set
forth in Title 14 of the Code of Federal Regulations.
"Governmental Authority" means any federal, state, local, or other
governmental or administrative body, instrumentality, board, department, or
agency or any court, tribunal, administrative hearing body, arbitration panel,
commission, or other similar dispute-resolving panel or body.
"Grantor" has the meaning specified therefor in the preamble hereto.
"Insolvency Proceeding" means any proceeding commenced by or against
any Person under any provision of the Bankruptcy Code or under any other state
or federal bankruptcy or insolvency law, assignments for the benefit of
creditors, formal or informal
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moratoria, compositions, extensions generally with creditors, or proceedings
seeking reorganization, arrangement, or other similar relief.
"Lender Group" means, individually and collectively, each of the
Lenders and Agent.
"Lenders" means, individually and collectively, each of the Lenders
from time to time party to the Credit Agreement.
"Maintenance Program" means an FAA approved maintenance program for
Grantor's Engines and Spare Parts in accordance with the applicable
manufacturer's maintenance planning document and maintenance manuals.
"Rotables" means those Spare Parts that, in accordance with the FARs
and the original equipment manufacturer's recommendations, can be repeatedly and
economically restored to a serviceable condition over a period approximating or
exceeding the life of the flight equipment to which they are related.
"Secured Obligations" means (a) all obligations of Grantor arising from
this Agreement, the Credit Agreement, or any of the other Loan Documents, and
(b) all Obligations (as defined in the Credit Agreement).
"Security Interest" has the meaning specified therefor in Section
2.1(a).
"Spare Parts" means all appliances and all Rotables, Expendables and
other spare parts of whatever nature, whether now owned or hereafter acquired by
Grantor, including any replacements, substitutions or renewals therefore, and
accessions thereto, including those Spare Parts of the general type described on
and located at the designated locations described on Schedule 1.1(S) attached
hereto, as such Schedule may be supplemented from time to time by a Supplemental
Schedule thereto.
"Supplemental Schedule" means and includes any supplemental schedule
now or hereafter executed substantially in the form attached hereto as (i)
Exhibit A for the purpose of supplementing Schedule 1.1(S) hereto to include
additional types of spare parts acquired by Grantor or designated locations of
Spare Parts, and (ii) Exhibit B for the purpose of supplementing Schedule 1.1(E)
hereto to include any additional aircraft engine acquired by Grantor.
"Transportation Code" shall mean Title 49 of the United States Code, as
amended from time to time, together with all rules, regulations, procedures,
orders, handbooks, guidelines and interpretations thereunder or related thereto.
"United States" means United States of America.
"Warranties" means the rights of Grantor under any existing or
hereinafter acquired warranty or indemnity, express or implied, regarding title,
materials, workmanship, design, or patent infringement or related matters in
respect of the Spare Parts.
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1.2. TERMS DEFINED IN THE TRANSPORTATION CODE AND THE CODE. Any terms
used in this Agreement that are defined in Section 40102 of the Transportation
Code shall be construed and defined as set forth in the Transportation Code
unless otherwise defined herein. Any terms used in this Agreement that are
defined in the Code shall be construed and defined as set forth in the Code
unless otherwise defined herein; provided, however, that to the extent that the
Code is used to define any term herein and such term is defined differently in
different Articles of the Code, the definition of such term contained in Article
9 of the Code shall govern. In the event of an apparent conflict between Section
40102 of the Transportation Code and the Code, it is the intention of the
parties hereto that such provisions be read together and construed, to the
fullest extent possible, to be in concert with each other. In the event of any
actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms
and provisions of Section 40102 of the Transportation Code shall control and
govern.
1.3. CONSTRUCTION. Unless the context of this Agreement or any other
Loan Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the terms "includes"
and "including" are not limiting, and the term "or" has, except where otherwise
indicated, the inclusive meaning represented by the phrase "and/or." The words
"hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless
otherwise specified. Any reference in this Agreement or in any other Loan
Document to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). Any reference herein or in any
other Loan Document to the satisfaction or repayment in full of the Obligations
shall mean the repayment in full in cash of all Obligations other than
unasserted contingent indemnification Obligations. Any reference herein to any
Person shall be construed to include such Person's successors and assigns. Any
requirement of a writing contained herein or in any other Loan Document shall be
satisfied by the transmission of a Record and any Record so transmitted shall
constitute a representation and warranty as to the accuracy and completeness of
the information contained therein.
1.4. SCHEDULES AND EXHIBITS. All of the schedules and exhibits attached
to this Agreement shall be deemed incorporated herein by reference.
2. CREATION OF SECURITY INTERESTS.
2.1. GRANT OF SECURITY INTERESTS.
(a) Grantor hereby unconditionally grants, assigns, and pledges to
Agent, for the benefit of the Lender Group, a continuing security interest in
and Lien upon (hereinafter referred to as the "Security Interest") all of
Grantor's right, title, and interest in and to any and all currently existing
and hereafter acquired or arising Collateral, in order to secure the payment and
performance when due of all of the Secured Obligations. Without limiting the
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generality of the foregoing, this Agreement secures the payment of all amounts
which constitute part of the Secured Obligations and would be owed by Grantor to
Agent, the other members of the Lender Group, or any of them, but for the fact
that they are unenforceable or not allowable due to the existence of an
Insolvency Proceeding involving Grantor.
(b) Anything contained in this Agreement to the contrary
notwithstanding, the term "Collateral", as used in this Agreement, shall not
include:
(i) any rights or interest in any contract, lease, permit,
license, charter, or license agreement covering real or personal property of
Grantor if (A) under the terms of such contract, lease, permit, license,
charter, or license agreement, or applicable law with respect thereto, the grant
of a security interest or Lien therein or collateral assignment of rights,
warranties or interests therein, requires the consent of the other party to such
contract, lease, permit, license, charter or license agreement or is prohibited
as a matter of law or under the terms of such contract, lease, permit, license,
charter, or license agreement, and (B) such prohibition has not been waived or
the consent thereto of the other party to such contract, lease, permit, license,
charter, or license agreement has not been obtained; provided, that the
foregoing exclusion (1) shall not apply if any described prohibition is
unenforceable under Section 9-406, 9-407, or 9-408 of the Code or other
applicable law, (2) shall not apply when such prohibition is no longer in
effect, and (3) shall not limit, impair, or otherwise affect the Agent's
continuing security interests in and Liens upon any rights or interests of
Grantor in or to (a) monies due or to become due under any described contract,
lease, permit, license, charter, or license agreement (including any Accounts),
or (b) any proceeds from the sale, license, lease, or other dispositions of any
such contract, lease, permit, license, charter, or license agreement; or
(ii) any aircraft engines or spare parts (and any accessions,
fixtures, and attachments thereto) that are purchased or acquired with proceeds
of, and subject to a Lien in favor of the provider of, Permitted Purchase Money
Indebtedness to the extent that (A) the contract for such Permitted Purchase
Money Indebtedness expressly prohibits the valid grant of a security interest or
Lien (other than the security interest or Lien securing such Permitted Purchase
Money Indebtedness) on such aircraft engines or spare parts (and any accessions,
fixtures, and attachments thereto) and (B) such prohibition has not been waived
or the consent of the provider of such Permitted Purchase Money Indebtedness has
not been obtained; provided, that the foregoing exclusion (1) shall not apply
when such prohibition is no longer in effect, and (2) shall not limit, impair,
or otherwise affect the Agent's continuing security interests in and Liens upon
any rights or interests of Grantor in or to any proceeds, substitutions, or
replacements of such aircraft engines or spare parts (and any accessions,
fixtures, and attachments thereto), to the extent not covered, or to the extent
permitted if covered, by the Lien securing such Permitted Purchase Money
Indebtedness.
(c) The Security Interest in the Collateral granted herein shall
attach to all Collateral without further act on the part of Agent, any Lender,
or Grantor. Except as expressly set forth in this Agreement, the Credit
Agreement, or any other Loan Document, Grantor does not have any authority,
express or implied, to assign, transfer, lease, exchange, pool or otherwise
dispose of any item or portion of the Collateral or interest therein.
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(d) Concurrently with the acquisition of any aircraft engine or
spare part (other than any aircraft engine or spare part excluded from the
definition of "Collateral" pursuant to Section 2.1(b)(ii)), Grantor shall
execute and deliver, in form for recordation, all applicable Supplemental
Schedules with respect to such Collateral.
2.2. SECURITY INSTRUMENTS; FURTHER ASSURANCES. Grantor shall perform,
or shall cause to be performed, at its sole expense, upon the request of Agent,
each and all of the following:
(a) record, register and file this Agreement and any Supplemental
Schedule, as well as such notices, financing statements, or other documents or
instruments as may, from time to time, be requested by Agent to fully carry out
the intent of this Agreement, with: (i) the FAA Registry in Oklahoma City,
Oklahoma, United States; and (ii) the location of Grantor as the term "location"
is defined in Section 9-307 of the Code; and (iii) such other Governmental
Authorities as may be determined by Agent to be necessary or advisable in order
to establish, confirm, maintain or perfect the Security Interest and Lien
created hereunder, as a legal, valid, and binding first priority security
interest and Lien upon the Collateral in favor of Agent, including if applicable
in connection with the Cape Town Convention;
(b) furnish to Agent evidence of every such recordation,
registration and filing; and
(c) execute and deliver or perform, or cause to be executed and
delivered or performed, such further and other instruments or acts as Agent
determines are necessary or required to fully carry out the intent and purpose
of this Agreement or to subject the Collateral to the Security Interest and Lien
created hereunder, including: (i) any and all acts and things which may be
reasonably requested by Agent with respect to complying with or remaining
subject to the FARs, or the laws and regulations of any of the various states or
countries in which any Engines or the Spare Parts are or may fly over, operate
in, or become located in; and (ii) defending the title of Grantor to and the
Security Interest of Agent on the Collateral by means of negotiation and, if
necessary, appropriate legal proceedings, against each and every party claiming
an interest therein contrary or adverse to Grantor's title to and the Security
Interest of Agent on same.
2.3. OPINION OF COUNSEL. Promptly following the execution and delivery
of this Agreement (and, thereafter, promptly following the execution and
delivery of a Supplemental Schedule), Grantor shall furnish an opinion of
Daugherty, Fowler, Peregrin and Xxxxxx Professional Corporation or other
qualified counsel in Oklahoma City, Oklahoma reasonably acceptable to Agent, in
form and substance reasonably satisfactory to Agent, that this Agreement (or,
promptly following the execution and delivery of a Supplemental Schedule, that
this Agreement as supplemented by such Supplemental Schedule) is in recordable
form and has been filed for recordation with the FAA in accordance with the
Transportation Code and creates a duly perfected first priority security
interest in favor of the Agent in the portion of the Collateral for which a
security interest can be perfected by such filing with the FAA in favor of Agent
and no other Liens are of record with the FAA with respect to the Collateral.
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2.4. AGENT APPOINTED POWER OF ATTORNEY. Grantor hereby irrevocably
appoints Agent its attorney-in-fact, with full authority in the place and stead
of Grantor and in the name of Grantor or otherwise, at such time as an Event of
Default has occurred and is continuing under the Credit Agreement, to take any
action and to execute any instrument which Agent may reasonably deem necessary
or advisable to accomplish the purposes of this Agreement, including: (a) to
ask, demand, collect, xxx for, recover, compromise, receive and give acquittance
and receipts for moneys due and to become due under or in connection with any
Collateral of Grantor; (b) to receive and open all mail addressed to Grantor and
to notify postal authorities to change the address for the delivery of mail to
Grantor to that of Agent; (c) to receive, indorse, and collect any drafts or
other instruments, documents, negotiable collateral or chattel paper; (d) to
file any claims or take any action or institute any proceedings which Agent may
deem necessary or desirable to enforce the rights of Agent with respect to any
of the Collateral; (e) to repair, alter, or supply goods, if any, necessary to
fulfill in whole or in part the purchase order of any Person obligated to
Grantor; (f) to use any labels, patents, trademarks, trade names, domain names,
industrial designs, copyrights, advertising matter or other industrial or
intellectual property rights, in advertising for sale and selling Collateral and
(g) to make recordations, registrations and other filings and take other actions
with or in respect of the FAA or any other Governmental Authority. To the extent
permitted by law, Grantor hereby ratifies all that such attorney-in-fact shall
lawfully do or cause to be done by virtue hereof. This power of attorney is
coupled with an interest and shall be irrevocable until this Agreement is
terminated.
2.5. RELEASE OF FAA MORTGAGE RECORDATIONS. To the extent expressly
permitted by the Engine and Spare Parts Security Agreement (as defined in the
Bank Credit Agreement) so long as such Agreement is in full force and effect,
and otherwise, upon written notice by Grantor to Agent of a sale by Grantor of
an Engine or a Spare Part that constitutes Collateral that is expressly
permitted under the Credit Agreement, at Grantor's expense, Agent will execute
and deliver a release of Agent's Lien and Security Interest on such Engine or
such Spare Part, as applicable, suitable for recordation with the FAA (an "FAA
Release"), in form and substance satisfactory to Agent, provided that such sale
is expressly permitted by the Credit Agreement or otherwise expressly consented
to in writing by Agent in accordance with the Credit Agreement. Nothing
contained in this Section 2.5 shall relieve Grantor in any respect of Grantor's
obligation under this Agreement or the Credit Agreement to remit to Agent
proceeds from the sale of Collateral as required by this Agreement or the Credit
Agreement.
2.6. INSTALLATION OF SPARE PARTS ON AND REMOVAL OF SPARE PARTS FROM AN
AIRCRAFT OR ENGINE. To the extent expressly permitted by the Engine and Spare
Parts Security Agreement (as defined in the Bank Credit Agreement) so long as
such Agreement is in full force and effect, and otherwise, Grantor may, at any
time and at its own cost and expense, incorporate or install in or attach to an
aircraft, an aircraft engine or a flight simulator, any Spare Part that
constitutes Collateral to replace any Spare Part removed from such aircraft,
aircraft engine or flight simulator for any reason whatsoever. To the extent
expressly permitted by the Engine and Spare Parts Security Agreement (as defined
in the Bank Credit Agreement) so long as such Agreement is in full force and
effect, and otherwise, Grantor may also from time to time and in accordance with
normal practices in the commercial airline industry, add any Spare Part that
constitutes Collateral to an aircraft, an aircraft engine or a flight simulator
for the purposes of making an addition or modification thereto without removing
a Spare Part from such aircraft, aircraft engine or flight simulator or may
remove a Spare Part from an aircraft, an engine or a
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flight simulator without replacing such Spare Part with another Spare Part.
Immediately upon a Spare Part that constitutes Collateral becoming incorporated
or installed in or attached to such aircraft, aircraft engine or flight
simulator, such Spare Part (including all warranties, insurances, leases,
proceeds, manuals, technical records and other intangible rights with respect
thereto) so incorporated or installed in or attached to such aircraft, aircraft
engine or flight simulator shall, without further act, cease to be part of the
Collateral and shall not be subject to this Agreement, shall be released from
and no longer be subject to the Security Interest hereof and the Security
Interest hereof shall cease to be attached to such Spare Part (including all
warranties, insurances, leases, proceeds, manuals, technical records and other
intangible rights with respect thereto). Any Spare Part removed from an
aircraft, an aircraft engine or a flight simulator shall without further act,
immediately become a Spare Part and subject to this Agreement and the Security
Interest hereof shall, and shall be deemed to, attach to such removed Spare Part
unless such Spare Part is excluded from the Collateral pursuant to Section
2.1(b)(ii); provided that such Spare Part shall not be deemed an Eligible Spare
Part unless and until such Spare Part satisfies all criteria of the definition
of "Eligible Spare Parts" set forth in the Credit Agreement.
3. REPRESENTATIONS AND WARRANTIES.
By executing and delivering this Agreement, and continually thereafter
(except to the extent any of the following representations or warranties by
their terms relate only to a particular prior date) until each and all of the
Secured Obligations have been fully paid and performed, Grantor hereby
represents and warrants to Agent as follows:
3.1. TITLE TO COLLATERAL. As of the date hereof, Schedule 1.1(S) lists
all spare parts in which Grantor has an interest as to which a "conveyance" (as
defined in 14 C.F.R. ss. 49.17 or any successor or similar regulation) is
eligible for recording with the FAA pursuant to 14 C.F.R. xx.xx. 49.51 and 49.52
or any successor or similar regulation. Grantor owns and will own legally and
beneficially all right, title and interest in and to the Collateral, and holds
and will hold good and marketable title to, the Engines and Spare Parts free of
all Liens (other than (x) Bank Agent's Lien and Agent's Lien, in the case of
Collateral at any time designated as Eligible Spare Parts or (y) Permitted
Liens, in the case of other Collateral, Engines, or Spare Parts).
3.2. PERFECTED SECOND PRIORITY SECURITY INTEREST. Upon the filing and
recordation of this Agreement (and, if applicable, any Supplemental Schedule)
with the FAA, Agent shall have a second priority perfected security interest in
that portion of the Collateral in which perfection is governed by the
Transportation Code and the FARs, subject to no Liens other than (x) Bank Credit
Agent's and Agent's Lien, in the case of Collateral at any time designated as
Eligible Spare Parts or (y) Permitted Liens in the case of Collateral that is
not designated as Eligible Spare Parts, and subject in priority only to the
Liens of Bank Credit Agent under the Bank Credit Documents. Grantor further
represents and warrants that, other than the filing of a financing statement in
the State of organization of Grantor and the recordation of this Agreement (and,
if applicable, any Supplemental Schedule) with the FAA, the execution, delivery,
and performance by Grantor of this Agreement, and the creation and perfection of
the Security Interest in favor of Agent hereunder against Grantor and all other
Persons, do not and will not require any registration, recordation or other
filing with, or consent, or approval of, or notice to, or other action with or
by, any Governmental Authority.
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3.3. COMPLIANCE. With respect to Spare Parts, Grantor makes the
representations and warranties which are set forth in Section 4.3 of the Credit
Agreement. With respect to Engines, Grantor hereby represents and warrants that
(a) each Engine is of good and merchantable quality, free from material defects
(except for repairable damage that will be repaired in the ordinary course of
Grantor's business), serviceable in accordance with Grantor's Maintenance
Program in good operating condition and ready for immediate use or operation in
accordance with Grantor's Maintenance Program and has all serviceability tags
applicable thereto and all related applicable back to birth records and all
other documents required by Grantor's Maintenance Program; (b) Grantor possesses
all necessary certificates, permits, rights, authorizations, concessions, and
consents which are material to the maintenance, installation, operation, use or
sale of each Engine, and (c) Grantor maintains all Engines, and the books and
records with respect thereto, in compliance with the requirements of applicable
law.
3.4. SPARE PARTS. Except as otherwise permitted by the Credit
Agreement, all Spare Parts that constitute Collateral are and will be maintained
by Grantor only at the locations listed on Schedule 1.1(S).
3.5. SECTION 1110 OF THE BANKRUPTCY CODE. With respect to the Engines
and Spare Parts that constitute Collateral first placed into service after
October 22, 1994, Agent is entitled to the benefits of Section 1110 of the
Bankruptcy Code in connection with the exercise of its remedies under this
Agreement in respect of all such Engines with Spare Parts constituting an
"aircraft engine," "propeller," "appliance" or "spare part" as such terms are
defined in Section 40102 of the Transportation Code. Except as specifically
designated in Schedule 1.1(E) or Schedule 1.1(S) hereto, all Engines and Spare
Parts that constitute Collateral were first placed in service after October 22,
1994.
4. COVENANTS.
Until each and all of the Secured Obligations have been fully paid and
performed, Grantor hereby covenants and agrees as follows:
4.1. COMPLIANCE WITH LAWS. Grantor shall neither use the Collateral,
nor permit the Collateral to be used, for any unlawful purpose or contrary to
any applicable statute, law, ordinance or regulation relating to the
registration, use, operation or control of the Collateral. Grantor shall comply
with the requirements of Section 5.10 of the Credit Agreement.
4.2. MAINTENANCE AND REPAIR.
(a) During the effectiveness of this Agreement, Grantor shall, at
its sole expense, do or cause to be done each and all of the following:
(i) maintain and keep the Engines and Spare Parts in as good
operating condition and repair as such Engines and Spare Parts are on the date
of this Agreement (ordinary wear and tear excepted and, other than with respect
to Eligible Spare Parts, ordinary course damage and economic obsolescence
excepted); and
(ii) maintain and keep the Engines and any Spare Parts in good
order and repair and airworthy and serviceable condition in accordance with the
requirements of each
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of the manufacturers' manuals, mandatory service bulletins, each of the
manufacturers' nonmandatory service bulletins which relate to airworthiness,
Grantor's Maintenance Program, and otherwise as necessary, so as to keep such
Engines and Spare Parts in such condition as they were when subjected to this
Agreement (ordinary wear and tear excepted and, other than with respect to
Eligible Spare Parts, ordinary course damage and economic obsolescence
excepted); and
(iii) without limiting the foregoing, cause to be performed, in
respect of all Engines and Spare Parts, all applicable mandatory airworthiness
directives, FARs, and manufacturers' service bulletins relating to
airworthiness, the compliance date of which shall occur during the term of this
Agreement.
(b) Grantor shall be responsible for all required inspections of
all Engines and all Spare Parts in accordance with all applicable FAA and other
governmental requirements.
(c) All inspections, maintenance, modifications, repairs and
overhauls of the Engines and the Spare Parts shall be performed by personnel
authorized by the FAA to perform such services, and in conformance with 14
C.F.R. ss. 49.43 or any successor or similar regulation.
(d) If any aircraft component, appliance, accessory, instrument,
equipment or part of any Engine or any Spare Part that constitutes Collateral
shall reach such a condition as to require overhaul, repair or replacement, for
any cause whatever, in order to comply with the standards or maintenance and
other provisions set forth in this Agreement, Grantor shall:
(i) install on such Engine or Spare Part, as applicable, such
items of the same type in temporary replacement of those then installed on the
Engine or such Spare Part, pending overhaul or repair of the unsatisfactory
item; provided, however, that (A) such replacement items must be in such a
condition as to be permissible for use upon the Engine or such Spare Part in
accordance with the standards for maintenance and other provisions set forth in
this Agreement, and (B) Grantor must, at all times, retain unencumbered title to
any and all items temporarily removed except for the Security Interest of Bank
Credit Agent and Agent and Permitted Liens; or
(ii) install on such Engine or Spare Part such items of the
same type in permanent replacement of those then installed on such Engine or
Spare Part; provided, however, that (A) such replacement items, if the item
itself, or if the Engine or Spare Part to which it relates, is described in any
Borrowing Base Certificate, must be new or be fully overhauled in accordance
with the requirements of the Loan Documents with "zero time" of operation since
the completion of such overhaul, and, in all cases, in such condition as to be
permissible for use upon such Engine or Spare Part in accordance with the
standards for maintenance and other provisions set forth in this Agreement, and
(B) Grantor must first comply with each of the requirements of Section 4.2(e)
hereof.
(e) In the event that during the effectiveness of this Agreement,
Grantor shall be required or permitted to install upon any Collateral
constituting an Engine or Spare Part any components, appliances, accessories,
instruments, aircraft engines, equipment or spare parts, in permanent
replacement of those then installed on such Collateral constituting an Engine or
Spare
11
Part, Grantor may do so provided that, in addition to any other requirements
provided for in this Agreement:
(i) Agent is not divested of its second priority Security
Interest, subject in priority only to the Liens of Bank Credit Agent under the
Bank Credit Documents, in any item removed from the Collateral constituting an
Engine or Spare Part as a result thereof and (other than Permitted Liens) no
such removed item shall be or become subject to the Lien, security interest or
claim of any person except Agent; and
(ii) Every installed item shall continue to be subject to the
Security Interest and Lien of Agent, and each of the provisions of this
Agreement, and each such item shall remain so encumbered and so subject.
(f) In the event that any component, appliance, accessory,
instrument, equipment or part installed upon the Engines or the Spare Part, is
not in substitution for or in replacement of an existing item, such additional
item shall be considered as an accession to such Engines or Spare Part, as the
case may be.
(g) All Engines and Spare Parts shall (i) have been manufactured in
accordance with 14 C.F.R. ss. 21.305 or any successor or similar regulation, and
(ii) be new (except for Rotables which have been overhauled as provided in the
Loan Documents with full traceability or are in the process of overhaul). All
Engines and Eligible Spare Parts shall at all times have all serviceability tags
with full traceability (including back-to-back records if not new) applicable
thereto and all other related documents required by Grantor's Maintenance
Program.
4.3. INSURANCE.
(a) Grantor shall comply with all insurance requirements set forth
in the Credit Agreement and, upon the acquisition of any Engines after the date
hereof that constitute Collateral, those additional insurance requirements
deemed appropriate by Agent.
(b) Grantor shall not use or permit the Collateral to be used in
any manner or for any purpose excepted from or contrary to the requirements of
any insurance policy or policies required to be carried and maintained under the
Credit Agreement or other Loan Documents or for any purpose excepted or exempted
from or contrary to such insurance policies, nor do any other act or permit
anything to be done which could reasonably be expected to invalidate or limit
any such insurance policy or policies.
4.4. TAXES. Cause all assessments and taxes (other than assessments or
taxes in de minimis amounts) due or payable by, or imposed, levied, or assessed
against any of the Collateral to be paid in full, before delinquency or before
the expiration of any extension period, except to the extent that the validity
of such assessment or tax shall be the subject of a Permitted Protest.
4.5. REGISTRATION. Grantor is and shall continue to be an air carrier
certificated under Section 44705 of the Transportation Code and has and shall
maintain in full force and effect an air carrier operating certificate issued
pursuant to Chapter 447 of the Transportation
12
Code to operate aircraft capable of carrying 10 or more individuals or 6,000
pounds or more of cargo and an air carrier operating certificate under Part 121
of the FARs.
4.6. [INTENTIONALLY OMITTED]
4.7. EVENT OF LOSS. Grantor hereby assumes and shall bear the entire
risk of any Event of Loss or other loss, theft, destruction of or damage to all
or any part of any Engine or Spare Part. Grantor shall promptly notify Agent in
writing of any Event of Loss or of any damage to or loss, theft or destruction
of any Collateral which does not constitute such an Event of Loss but having a
cost of repair or replacement of in excess of $1,000,000 which notice shall
include the cost of repair in the event of damage such Collateral. Grantor shall
promptly cause any such damage or destruction to be repaired in accordance with
the FARs and the manufacturer recommendations. Following the date on which
Discharge of First Lien Obligation occurs, with respect to any Event of Loss to
an Engine or Spare Part constituting Collateral, any insurance proceeds
recovered by Grantor with respect thereto shall be applied in accordance with
Section 2.2(c) of the Credit Agreement.
4.8. INDEMNIFICATION.
(a) Grantor agrees to be liable for, pay for and indemnify, defend
and hold harmless, on demand, Agent and each of the Lenders and each of their
successors and assigns and each of any of their officers, directors,
shareholders, partners, members, employees, agents and other representatives
(each an "indemnitee") from and against any and all claims, proceedings,
lawsuits, losses, liabilities, obligations, damages judgments, fees, penalties
or fines (whether criminal or civil), reasonable costs and expenses (including
reasonable attorneys fees and including reasonable attorneys fees incurred to
enforce this Agreement, including this indemnity) of any kind or nature
whatsoever, including if arising or resulting from strict liability or any
negligence on the part of any indemnitee, incurred or suffered by any indemnitee
and arising out of or resulting from Agent's rights herein or in the Collateral
or the manufacture, ownership, repair, maintenance, overhaul, refurbishment,
modification, leasing, storage, condition, design, infringement, use, purchase,
sale, leasing, pooling, exchange, operation or possession by Grantor or any
other Person of any Collateral or any aircraft or aircraft engine in which any
Collateral is installed or used, except claims, losses or liabilities resulting
from the gross negligence or willful misconduct of the party seeking
indemnification as determined by a final non-appealable order of a court of
competent jurisdiction. This provision shall survive the termination of this
Agreement and the Credit Agreement and the repayment of the Secured Obligations.
(b) Grantor shall, upon demand, pay to Agent all the Expenses which
Agent may incur in connection with (i) the custody, preservation, use or
operation of, or, upon an Event of Default, the sale of, collection from, or
other realization upon, any of the Collateral in accordance with this Agreement
and the other Loan Documents, (ii) the exercise or enforcement of any of the
rights of Agent hereunder or (iii) the failure by Grantor to perform or observe
any of the provisions hereof.
4.9. LOCATION OF THE SPARE PARTS; RECORDS; DISPOSITIONS. Except as
otherwise permitted by the Credit Agreement, Grantor shall maintain all Spare
Parts at only the
13
locations specified in Schedule 1.1(S) hereto, and shall otherwise comply with
Section 5.17 of the Credit Agreement.
4.10. SECTION 1110. With respect to Engines and Spare Parts that
constitute Collateral first placed into service after October 22, 1994, Grantor
acknowledges and agrees that the Security Interest created in favor of Agent
under this Agreement entitles Agent, for the benefit of the Lender Group, to all
of the benefits of Section 1110 of the Bankruptcy Code with respect to all such
Engines and Spare Parts constituting an "aircraft engine," "propeller,"
"appliance" or "spare engine," as such terms are defined in Section 40102 of the
Transportation Code. Grantor will take such further actions, including the
execution and delivery of such additional agreements and other documents as may,
in the reasonable opinion of Agent, be advisable to provide Agent with the
benefits of Section 1110 of the Bankruptcy Code. Grantor shall ensure that
except as otherwise disclosed on Schedule 1.1 hereto, all Spare Parts that
constitute Collateral shall have been first placed in service after October 22,
1994.
4.11. RECOGNITION OF RIGHTS AGREEMENT.
Grantor shall obtain from each owner, lessor, mortgagee, conditional
vendor, secured party or other holder of an interest in any airframe on which an
Engine that constitutes Collateral is installed a "Recognition of Rights
Agreement" in a form and substance reasonably acceptable to Agent, or the
applicable lease, mortgage, conditional sale agreement, security agreement or
other instrument shall contain an effective agreement in favor of Agent with
respect to each such Engine, reasonably acceptable to Agent, to the effect of
such Recognition of Rights Agreement.
5. EVENTS OF DEFAULT.
The occurrence of an Event of Default (as defined in the Credit
Agreement) shall each constitute an "Event of Default" under this Agreement.
6. AGENT'S RIGHTS AND REMEDIES. Upon the occurrence, and during the
continuation, of an Event of Default:
6.1. RIGHTS AND REMEDIES.
(a) Agent may exercise in respect of the Collateral, in addition to
other rights and remedies provided for herein, in the other Loan Documents, or
otherwise available to it, all the rights and remedies of a secured party on
default under the Code or any other applicable law. Without limiting the
generality of the foregoing, Grantor expressly agrees that, in any such event,
Agent without demand of performance or other demand, advertisement or notice of
any kind (except a notice specified below of time and place of public or private
sale) to or upon Grantor or any other Person (all and each of which demands,
advertisements and notices are hereby expressly waived to the maximum extent
permitted by the Code or any other applicable law), may enter onto any premises
of Grantor and take immediate possession of all or any portion of the Collateral
and (i) require Grantor to, and Grantor hereby agrees that it will at its own
expense and upon request of Agent forthwith, assemble all or part of the
Collateral as directed by Agent and make it available to Agent at one or more
locations where Grantor regularly maintains such Collateral, and (ii) without
notice except as specified below, sell the
14
Collateral or any part thereof in one or more parcels at public or private sale,
at any of Agent's offices or elsewhere, for cash, on credit, and upon such other
terms as Agent may deem commercially reasonable. Grantor agrees that, to the
extent notice of sale shall be required by law, at least 10 days notice to
Grantor of the time and place of any public sale or the time after which any
private sale is to be made shall constitute reasonable notification and
specifically such notice shall constitute a reasonable "authenticated
notification of disposition" within the meaning of Section 9-611 of the Code.
Agent shall not be obligated to make any sale of Collateral regardless of notice
of sale having been given. Agent may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such sale
may, without further notice (except as may be required by law), be made at the
time and place to which it was so adjourned.
(b) Agent may, in its sole discretion, from time to time, at the
expense of Grantor make all such expenditures for the payment of taxes,
insurance, storage and other expenses related to the Collateral and for
remarketing, maintenance, modifications, refurbishments, repairs, replacements,
alterations, additions and improvements to and of the Collateral, as it may deem
proper. In each such case, Agent shall have the right to maintain, use, operate,
store, lease, control or manage the Collateral and to exercise all rights and
powers of Grantor relating to the Collateral in connection therewith, as Agent
shall deem appropriate, including the right to enter into any and all such
agreements with respect to the maintenance, modification, refurbishment,
insurance, use, operation, storage, leasing, control, management or disposition
of the Collateral or any part thereof as Agent may determine; and Agent shall be
entitled to collect and receive directly all tolls, rents, revenues, issues,
income, products and profits of the Collateral and every part thereof. Grantor
shall pay on demand, and any such tolls, rents, revenues, issues, income,
products and profits may be applied to pay, all expenses incurred by Agent in
connection with the foregoing and any and all other expenses of possession, use,
operation, storage, leasing, control, management or disposition of the
Collateral, and of all maintenance, modification, refurbishment, repairs,
replacements, alterations, additions and improvements, and all payments which
Agent may be required or may elect, to make, if any, for Taxes, insurance,
storage or other charges assessed against or otherwise imposed upon the exercise
of any rights under any of the Loan Documents or the Collateral or any part
thereof (including the employment of agents for the remarketing of the Aircraft
for sale or lease, and appraisers, technicians, engineers and accountants to
examine, inspect and make reports upon the properties and books and records of
Grantor), and all other payments which Agent or any Lender may be required or
authorized to make under any provision of this Agreement, as well as just and
reasonable compensation for the services of Agent, and of all Persons engaged or
employed by Agent.
(c) Agent is hereby granted a license or other right to use,
without liability for royalties or any other charge, Grantor's labels, patents,
copyrights, rights of use of any name, trade secrets, trade names, trademarks,
service marks and advertising matter, domain names, industrial designs, other
industrial or intellectual property or any property of a similar nature, whether
owned by Grantor or with respect to which Grantor has rights under license,
sublicense, or other agreements, as it pertains to the Collateral, in preparing
for sale, advertising for sale and selling any Collateral, and Grantor's rights
under all licenses and all franchise agreements shall inure to the benefit of
Agent.
15
(d) Any cash held by Agent as Collateral and all cash proceeds
received by Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral shall be applied against the
Secured Obligations in the order set forth in the Credit Agreement. In the event
the proceeds of Collateral are insufficient to satisfy all of the Secured
Obligations in full, Grantor shall remain liable for any such deficiency.
(e) Grantor hereby acknowledges that the Secured Obligations arose
out of a commercial transaction and agrees that if an Event of Default shall
occur Agent shall have the right to an immediate writ of possession without
notice of a hearing. Agent shall have the right to the appointment of a receiver
for the properties and assets of Grantor, and Grantor hereby consents to such
rights and such appointment and hereby waives any objection Grantor may have
thereto or the right to have a bond or other security posted by Agent.
6.2. REMEDIES CUMULATIVE. Each right, power, and remedy of Agent as
provided for in this Agreement or in the other Loan Documents or now or
hereafter existing at law or in equity or by statute or otherwise shall be
cumulative and concurrent and shall be in addition to every other right, power,
or remedy provided for in this Agreement or in the other Loan Documents or now
or hereafter existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by Agent, of any one or more of such
rights, powers, or remedies shall not preclude the simultaneous or later
exercise by Agent of any or all such other rights, powers, or remedies.
6.3. MARSHALING. Agent shall not be required to marshal any present or
future collateral security (including but not limited to the Collateral) for, or
other assurances of payment of, the Secured Obligations or any of them or to
resort to such collateral security or other assurances of payment in any
particular order, and all of its rights and remedies hereunder and in respect of
such collateral security and other assurances of payment shall be cumulative and
in addition to all other rights and remedies, however existing or arising. To
the extent that it lawfully may, Grantor hereby agrees that it will not invoke
any law relating to the marshaling of collateral which might cause delay in or
impede the enforcement of Agent's rights and remedies under this Agreement or
under any other instrument creating or evidencing any of the Secured Obligations
or under which any of the Secured Obligations is outstanding or by which any of
the Secured Obligations is secured or payment thereof is otherwise assured, and,
to the extent that it lawfully may, Grantor hereby irrevocably waives the
benefits of all such laws.
7. WAIVERS; LIABILITY.
7.1. DEMAND; PROTEST; ETC. To the extent permitted by law, Grantor
waives demand, protest, notice of protest, notice of default or dishonor, notice
of payment and nonpayment, notice of any default, nonpayment at maturity,
release, compromise, settlement, extension, or renewal of accounts, documents,
instruments, chattel paper, and guarantees at any time held by Agent on which
Grantor may in any way be liable.
7.2. AGENT'S LIABILITY FOR COLLATERAL. So long as Agent complies with
its obligations, if any, under the Code, Agent shall not in any way or manner be
liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss
or damage thereto occurring or arising in any manner or fashion from any cause;
(c) any diminution in the value thereof; or (d) any act or
16
default of any carrier, warehouseman, bailee, forwarding agency, or other
Person, except in the case of each of clauses (a), (b), (c) and (d) above, for
any liability resulting from the gross negligence or willful misconduct of Agent
as finally determined by a court of competent jurisdiction. All risk of loss,
damage, or destruction of the Collateral shall be borne by Grantor. The powers
conferred on Agent hereunder are solely to protect its interests in the
Collateral and shall not impose on it any duty to exercise such powers. Except
as provided in the Code, Agent shall not have any duty with respect to the
Collateral or any responsibility for taking any necessary steps to preserve
rights against prior parties or any other Persons with respect to any
Collateral.
8. NOTICES.
All notices and other communications hereunder to Agent shall be in
writing and shall be mailed, sent or delivered in accordance with the Credit
Agreement and all notices and other communications hereunder to Grantor shall be
in writing and shall be mailed, sent or delivered in care of Parent in
accordance with the Credit Agreement.
9. GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED IN THE STATE OF NEW YORK EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE SECURITY INTERESTS HEREUNDER IN RESPECT OF ANY COPYRIGHT
COLLATERAL ARE GOVERNED BY FEDERAL LAW, IN WHICH CASE SUCH CHOICE OF NEW YORK
LAW SHALL NOT BE DEEMED TO DEPRIVE AGENT OF SUCH RIGHTS AND REMEDIES AS MAY BE
AVAILABLE UNDER FEDERAL LAW.
10. CONSENT TO JURISDICTION, SERVICE OF PROCESS AND VENUE.
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE
BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX IN THE COUNTY OF NEW YORK OR OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, GRANTOR HEREBY IRREVOCABLY ACCEPTS IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. GRANTOR HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND
ALL LEGAL PROCESS, SUMMONS, NOTICES, AND DOCUMENTS IN ANY SUIT, ACTION, OR
PROCEEDING BROUGHT IN THE UNITED STATES ARISING OUT OF OR IN CONNECTION WITH
THIS AGREEMENT BY THE MAILING (BY REGISTERED MAIL OR CERTIFIED MAIL, POSTAGE
PREPAID) OR DELIVERING OF A COPY OF SUCH PROCESS TO GRANTOR, C/O PARENT, AT THE
PARENT'S ADDRESS FOR NOTICES AS SET FORTH IN SECTION 11 OF THE CREDIT AGREEMENT.
GRANTOR AGREES THAT A FINAL NONAPPEALABLE JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY
17
OTHER MANNER PROVIDED BY LAW. NOTHING HEREIN SHALL AFFECT THE RIGHT OF AGENT AND
THE LENDERS TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE
LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST GRANTOR IN ANY OTHER
JURISDICTION. GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT GRANTOR HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, GRANTOR HEREBY
IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
AGREEMENT.
11. WAIVER OF JURY TRIAL, ETC.
GRANTOR AND AGENT EACH HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS
AGREEMENT, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR
OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION
HEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH
THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR COUNTERCLAIM
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. GRANTOR CERTIFIES THAT NO
OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF AGENT, OR ANY LENDER HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD NOT, IN THE
EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK TO ENFORCE THE FOREGOING
WAIVERS. GRANTOR HEREBY ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT.
12. REFERENCES. Each reference herein to any right granted to, benefit
conferred upon or power exercisable by the "Agent" shall be a reference to
Agent, for the benefit of the Lender Group.
13. GENERAL PROVISIONS.
13.1. EFFECTIVENESS. This Agreement shall be binding and deemed
effective when executed by Grantor and accepted and executed by Agent.
13.2. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to
the benefit of the parties hereto and their respective successors and assigns;
provided, however, that
18
Grantor may not assign this Agreement or any rights or duties hereunder without
prior written consent of Agent and Lenders and any prohibited assignment shall
be absolutely void. No consent to an assignment by Agent and Lenders shall
release Grantor from its Secured Obligations. On behalf of Agent and Lenders,
Agent may assign this Agreement and its rights and duties hereunder in
accordance with the Credit Agreement and no consent or approval by Grantor is
required in connection with any such assignment.
13.3. INTERPRETATION. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved against Agent, Lenders, or
Grantor, whether under any rule of construction or otherwise. On the contrary,
this Agreement has been reviewed by all parties and shall be construed and
interpreted according to the ordinary meaning of the words used so as to fairly
accomplish the purposes and intentions of all parties hereto.
13.4. SEVERABILITY OF PROVISIONS. Any provision of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or affecting
the validity or enforceability of such provision in any other jurisdiction.
13.5. ENTIRE AGREEMENT; AMENDMENTS. This Agreement, together with the
other Loan Documents, reflects the entire understanding of the parties with
respect to the transactions contemplated hereby and shall not be contradicted or
qualified by any other agreement, oral or written, before the date hereof.
Neither this Agreement nor any provision hereof may be modified, amended or
waived except by the written agreement of the parties to this Agreement. The
foregoing notwithstanding, Agent may re-execute this Agreement, modify, amend or
supplement the Schedules hereto or execute a supplemental Security Agreement, as
provided herein, and the terms of any such modification, amendment, supplement
or supplemental Security Agreement shall be deemed to be incorporated herein by
this reference.
13.6. SECURITY INTEREST ABSOLUTE. To the maximum extent permitted by
law, all rights of Agent, all Security Interests hereunder, and all obligations
of Grantor hereunder, shall be absolute and unconditional, irrespective of:
(a) any lack of validity or enforceability of any of the Secured
Obligations or any other agreement or instrument relating thereto, including any
of the Loan Documents, any change in the time, manner or place of payment of, or
in any other term of, all or any of the Secured Obligations or any other
amendment or waiver of or any consent to any departure from any of the Loan
Documents or any other agreement or instrument relating thereto;
(b) any exchange, release, or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to departure
from any Loan Document; or
(c) any other circumstances that might otherwise constitute a
defense available to, or a discharge of, Grantor.
13.7. COUNTERPARTS; TELEFACSIMILE EXECUTION. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which, when executed and delivered, shall be
deemed to be an original, but all of which taken together shall constitute one
and the same agreement. Delivery of an executed counterpart
19
of this Agreement by telefacsimile shall be equally as effective as delivery of
an original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by telefacsimile also shall deliver an
original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement.
13.8. TERMINATION; RELEASE. Subject to Section 13.9, when the Secured
Obligations have been indefeasibly paid and performed in full in immediately
available funds, this Agreement shall terminate and all rights in the Collateral
shall revert to Grantor. Agent, at the request and sole expense of Grantor, will
promptly execute and deliver to Grantor the necessary instruments (including
Uniform Commercial Code termination statements) acknowledging the termination of
this Agreement, and will duly assign, transfer and deliver to Grantor, without
recourse, representation or warranty of any kind whatsoever, such of the
Collateral as may be in possession of Agent and has not theretofore been
disposed of, applied or released.
13.9. REINSTATEMENT; CERTAIN PAYMENTS. If any claim is ever made upon
Agent or any Lender for repayment or recovery of any amount or amounts received
by Agent or such Lender in payment or on account of any of the Secured
Obligations, Agent or such Lender shall give prompt notice of such claim to, as
applicable, Agent, each Lender and Grantor, and if such Agent or such Lender
repays all or part of such amount by reason of (i) any judgment, decree or order
of any court or administrative body having jurisdiction over Agent or such
Lender or any of its property, or (ii) any good faith settlement or compromise
of any such claim effected by Agent or such Lender with any such claimant, then
and in such event Grantor agrees that (A) any such judgment, decree, order,
settlement or compromise shall be binding upon it notwithstanding the
cancellation of any Indebtedness hereunder or under the other Loan Documents or
the termination of this Agreement or the other Loan Documents, and (B) it shall
be and remain liable to Agent or such Lender hereunder for the amount so repaid
or recovered to the same extent as if such amount had never originally been
received by Agent or such Lender.
13.10. SECURITY AGREEMENT. The provisions of this Agreement are
supplemental to the provisions of the Security Agreement. In the event of any
actual, irreconcilable conflict that cannot be resolved between the Engine and
Spare Parts provisions of the Security Agreement and this Agreement, the
provisions of this Agreement shall control and govern.
[Signature page follows.]
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered as of the date first above written.
AGENT:
CANYON CAPITAL ADVISORS LLC,
a Delaware limited liability company
By: /s/ Xxxxx Xxxxx
----------------------------------
Name: Xxxxx Xxxxx
---------------------------
Title: Managing Partner
---------------------------
GRANTOR:
HAWAIIAN AIRLINES, INC.,
a Delaware corporation
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------
Name: W. Xxxxxxx Xxxxxxx
---------------------------
Title: Senior Vice President,
---------------------------
Chief Financial Officer &
---------------------------
Treasurer
---------------------------
SCHEDULE 1.1(S)
SPARE PARTS
Spare Part Types
Grantor hereby unconditionally grants, assigns, and pledges to Agent, for the
benefit of the Lender Group, a continuing security interest in and Lien upon all
of Grantor's right, title, and interest in and to any and all appliances and all
Rotables, Expendables and other spare parts of whatever nature, whether now
owned or hereafter acquired by Grantor, including any replacements,
substitutions or renewals therefore, and accessions thereto, including, without
limitation, the Spare Parts listed on Exhibit A attached hereto.
Spare Part Locations
--------------------
HAWAIIAN AIRLINES ALASKA
ANCHORAGE INTERNATIONAL AIRPORT
XX XXX 00000
XXXXXXXXX, XX 00000
HAWAIIAN AIRLINES ARIZONA
0000 XXXX XXX XXXXXX XXXX, XXXXXXXX 0
XXXXXXX, XX 00000
HAWAIIAN AIRLINES CALIFORNIA
LOS ANGELES INTERNATIONAL AIRPORT
TERMINAL TWO
000 XXXXX XXX, XXX 0
XXX XXXXXXX, XX 00000
HAWAIIAN AIRLINES CALIFORNIA
SACRAMENTO INTERNATIONAL AIRPORT
0000 XXXXXXX XXXX, XXXXX 00
XXXXXXXXXX, XX 00000
HAWAIIAN AIRLINES CALIFORNIA
SAN DIEGO INTERNATIONAL AIRPORT
0000 X. XXXXXX XXXXX, XXXXX X000.0
XXX XXXXX, XX 00000
HAWAIIAN AIRLINES CALIFORNIA
SAN FRANCISCO INTERNATIONAL AIRPORT
DELTA AIRLINES SOUTH TERMINAL DOMESTIC
XXX XXXXXXXXX, XX 00000
HAWAIIAN AIRLINES HAWAII
XXXX XXXXXXXXXXXXX XXXXXXX
XXXX, XX 00000
HAWAIIAN AIRLINES HAWAII
HONOLULU INTERNATIONAL AIRPORT
000 XXXXX XXXXXX
XXXXXXXX, XX 00000
HAWAIIAN AIRLINES HAWAII
KAHULUI INTERNATIONAL AIRPORT
KAHULUI, HI 96732
HAWAIIAN AIRLINES HAWAII
KONA INTERNATIONAL AIRPORT
00-000 XXXXXX XX.
XXXXXX XXXX, XX 00000
HAWAIIAN AIRLINES HAWAII
LIHUE AIRPORT
0000 XXXXXXXX XXXX #0
XXXXX, XX 00000
HAWAIIAN AIRLINES NEVADA
MCCARRAN INTERNATIONAL AIRPORT
FRONT COUNTER-TERMINAL TWO
0000 XXXXX XXXXXX XXXXXXXXX
XXX XXXXX, XX 00000
HAWAIIAN AIRLINES OREGON
PORTLAND INTERNATIONAL AIRPORT
DELTA COUNTER MAIN TERMINAL
0000 XX XXXXXXX XXX
0000
XXXXXXXX, XX 00000
HAWAIIAN AIRLINES WASHINGTON
SEATTLE/TACOMA INTERNATIONAL AIRPORT
C/O DELTA AIRLINES TICKET COUNTER
XXXXXXX, XX 00000
IPECO INC. CALIFORNIA
0000 XXXXXXXXX XX
XXXXXXXX, XXXXXXXXXX 00000
-2-
AAR AIRCRAFT COMPONENT SERVICES NEW YORK
AVIATION SERVICE
000 XXXXXXXXXX XXXX.
XXXXXX XXXX, XXX XXXX 00000-0000
XXXXX RITE PRODUCTS, INC. CALIFORNIA
0000 X. XXXX XX.
XXXXXXXXX, XXXXXXXXXX 00000
AERO CONTROLS AVIONICS, INC. FLORIDA
0000 X. X. 00XX XX.
XXXXX, XXXXXXX 00000
AERO CONTROLS, INC. WASHINGTON
0000 00XX XXXXXX X.X.
XXXXXX, XXXXXXXXXX 00000
AERO INSTRUMENTS & AVIONICS NEW YORK
0000 XXXX XXXX
XXXXX XXXXXXXXX, XXX XXXX 00000
AERO-CRAFT HYDRAULICS, INC. CALIFORNIA
000 XXXXX XXXXX XXXXXX
XXXXXX, XXXXXXXXXX 00000
AEROSPACE ACCESSORY SERVICE INC FLORIDA
0000 X.X. 00XX XXXXXX
XXXXX, XXXXXXX 00000
AEROTEC INTERNATIONAL INC. ARIZONA
0000 X. XXXXXXXXXX XXXXXX
XXXXXXX, XXXXXXX 00000
AEROTRON AIR POWER INC. GEORGIA
000 XXXXXXXX XXXXXXX
XX XXXXXX, XXXXXXX 00000
AIR CRUISERS CO CALIFORNIA
00000 XXXXXX XXXXXX
XXXXX, XXXXXXXXXX 00000
AIRCRAFT BRAKING SYSTEMS CORPORATION OHIO
0000 XXXXXXXXX XXXX
XXXXX, XXXX 00000-0000
-3-
AIRCRAFT REPAIR/OVERHAUL SERVICE CALIFORNIA
0000 X. XXXXX XXXXXX
XXXXXXX, XXXXXXXXXX 00000
AIRCRAFT SYSTEMS FLORIDA
0000 X.X. 00XX XXXXXX
XXXXX, XXXXXXX 00000
AIRSHOW, INC. CALIFORNIA
0000 XXX XXXXXX
XXXXXX, XXXXXXXXXX 00000
ALAMEDA AEROSPACE CALIFORNIA
000 X XXXXXXXX XXXXXX
XXXXXXX XXXXX
XXXXXXX, XXXXXXXXXX 00000
AMETEK AEROSPACE WASHINGTON
SEATTLE SUPPORT CENTER
0000 XXXXXXX XXXXXX XXXXXXXXX XX XXXXX X
XXXXXXXX, XXXXXXXXXX 00000
AMETEK AEROSPACE XXXX.XXX. MASSACHUSETTS
00 XXXXXXX XX
XXXXXXXXXX, XXXXXXXXXXXXX 00000
ASSOCIATED PAINTERS, INC. WASHINGTON
C/O GOODRICH AVIATION TECH SVC
0000 000XX XXXXXX XX
XXXXXXX, XXXXXXXXXX 00000
ASTRO-AIRE ENTERPRISES CALIFORNIA
OAKLAND INTL AIRPORT BLDG L-551
0000 XXXXXXX XXXX
XXXXXXX, XXXXXXXXXX 00000
AVIALL SERVICES INC. CALIFORNIA
0000 XXXXXXX XXX
XXX XXXX, XXXXXXXXXX 00000-0000
AVIBANK SERVICES, LLC CALIFORNIA
ATTN: REPAIR DEPT
00000 XXXXXXX XXX
XXXXX XXXXXXXXX, XXXXXXXXXX 00000
-4-
AVIONIC INSTRUMENTS INC DEL NEW JERSEY
0000 XXXXXXXX XXXXXX
XXXXXX, XXX XXXXXX 00000
AVTECH CORP WASHINGTON
0000 XXXXXXXXXXX XXXXXX XXXXX
XXXXXXX, XXXXXXXXXX 00000-0000
BAE SYSTEMS CONTROLS INDIANA
DOCK 1, 0000 XXXXXX XX
XX XXXXX, XXXXXXX 00000
XXXXXXXX INSTRUMENT CORP FLORIDA
0000 X.X. 00XX XXXXXX
XXXXX, XXXXXXX 00000
XXXXX CONTROLS AEROSPACE CALIFORNIA
A UNIT OF APPLIED POWER INC.
0000 XXXXXXX XXXXXX
XXXXXXX, XXXXXXXXXX 00000
BE AEROSPACE, INC. KANSAS
00000 XXXXXX XXXX
XXXXXX, XXXXXX 00000
BOEING ELECTRONIC SERVICE CENTER TEXAS
0000 XXXXX XXXX XXXX
XXXXXX, XXXXX 00000
CALIFORNIA RADOMES CALIFORNIA
000 XXXX XXXXXX
XXXXX XXXXX, XXXXXXXXXX 00000
CHROMALLOY ARIZONA ARIZONA
0000 XXXX XXX XXXXX XXXXXX
XXXXXXX, XXXXXXX 00000
XXXXXXX AVIATION SERVICES TEXAS
DFW SERVICE BASE
0000 XXXX XXXXX XXXX
XXXXX 000
XXXXXX, XXXXX 00000-0000
-5-
XXXXXXX AVIONICS DIVISION IOWA
ROCKWELL INTERNATIONAL CORP.
000 XXXXXXX XXXX XX, M/S 000-000
XXXXX XXXXXX, XXXX 00000
XXXXXXX AVIONICS SERVICE CENTER WASHINGTON
ROCKWELL INTERNATIONAL
000 XXXXXX XXXXXX X.X.
XXXXXX, XXXXXXXXXX 00000-0000
CROWN CHROME PLATING, INC. CALIFORNIA
00000 XXXXXXXX XX
XXX XXXX, XXXXXXXXXX 00000
XXXXXXX XXXXXX ACCESSORY SERVICES FLORIDA
0000 X.X. 00XX XXXXXX
XXXXX, XXXXXXX 00000
CUSTOM PRODUCTS NORTH CAROLINA
0000 XXXXXX XXXXXXX
XXXXXXXXXXX, XXXXX XXXXXXXX 00000
DELTA AIRLINES GEORGIA
MAINTENANCE FACILITY
0000 XXXXXXXX XXXX
XXXXXXX XXXXXXX
XXXXXXX, XXXXXXX 00000
XXXXXX AVIATION CORP. NEW MEXICO
6104B JEFFERSON, N.E.
XXXXXXXXXXXX, XXX XXXXXX 00000
XXXXXXXX HAWAII
00-000 XXXXXXXX XXXXXX
XXXXXXX, XXXXXX 00000
XXXXXXXX SERVICES HAWAII
000 XXXXXXXXXX XXXXX
XXXXXXXX, XXXXXX 00000
XXXXXXXX SERVICES INC WASHINGTON
WORLDWIDE CARGO SERVICES, INC
0000 X. XX XX, XXX 0
XXXXXX, XXXXXXXXXX 00000
-6-
XXXXXXXX SERVICES INC. CALIFORNIA
00000 XXXXX XXXXXXX XXX
XXXXXXX, XXXXXXXXXX 00000
XXXXXXXX SERVICES, INC. CALIFORNIA
000 XXXXX XXXXX XXXXXX
XXX 0
XXXXX XXX XXXXXXXXX, XXXXXXXXXX 94080
DRY CLEAN EXPRESS HAWAII
00-000 XXX XXXXXXX
XXXX, XXXXXX 00000
XXXXX AEROSPACE LLC MISSISSIPPI
XXXXXXX FLUID POWER
0000 XXXXXXXX XXXXX
XXXXXXX, XXXXXXXXXXX 00000
XXXXX CORPORATION CONNECTICUT
PRESSURE SENSORS DIVISION
00 XXXXXX XXXXXX
XXXXXX, XXXXXXXXXXX 00000-0000
ELDEC CORPORATION WASHINGTON
SENSING SYSTEMS DIVISION
00000 00XX XXXXXX XXXX
XXXXXXXX, XXXXXXXXXX 00000
ENVIROVAC, INC ILLINOIS
0000 XXXXXX XXXXX
XXXXXXXX, XXXXXXXX 00000-0000
FINLAY TESTING LABORATORIES, INC HAWAII
000 XXXXX XXXXXX
XXXXXXXX, XXXXXX 00000
FLOATS & FUEL CELLS SERVICES TENNESSEE
0000 XXXXX XXXXX XXXXX 0
XXXXXXX, XXXXXXXXX 00000
FOUR STAR ACCESSORY OVERHAUL, INC. WASHINGTON
0000 XXX XXXXXX XXXXXX X. X.
XXXXXXXX, XXXXXXXXXX 00000
-7-
XXXXXX AEROSPACE NORTH CAROLINA
0000 XXXXXXX XXXX
XXXXXXXX, XXXXX XXXXXXXX 00000
XXXXXXXX CALIFORNIA
AEROSTRUCTURES GROUP
000 XXXXXX XXXXX
XXXXX XXXXX, XXXXXXXXXX 00000-0000
XXXXXXXX AEROSPACE WASHINGTON
AVIATION TECHNICAL SERVICES
0000 000XX XXXXXX XX
XXXXXXX, XXXXXXXXXX 00000-0000
XXXXXXXX AEROSPACE DIV FLORIDA
LIGHTING SYSTEMS DIVISION
000 XXXXXXXXX XXXXXX
XXXXXXX, XXXXXXX 00000-0000
XXXXXXXX AIRCRAFT EVACUATION SYSTEMS WASHINGTON
0000 000XX XX XX#X000
XXXXXXXX, XXXXXXXXXX 00000-0000
XXXXXXXX ALABAMA SERVICE CENTER ALABAMA
0000 XXXX XXXX XXXXXX
XXXXX, XXXXXXX 00000-0000
XXXXXXXX PHOENIX SERVICE CENTER ARIZONA
0000 XXXXX 0XX XX.
XXXXX 000
XXXXXXX, XXXXXXX 00000
XXXXXX AEROSPACE CO OHIO
HONEYWELL AEROSPACE
000 XXXXX XXXXXX
XXXXXX, XXXX 00000
XXXXXXXX SUNDSTRAND CONNECTICUT
XXX XXXXXXXX XXXX
XXXXXXX XXXXX, XXXXXXXXXXX 00000
XXXXXXXX SUNDSTRAND ARIZONA
00000X XXXXX XXXXX XXXXXX XXX
XXXXXX, XXXXXXX 00000
-0-
XXXXXXXX XXXXXXXXXX CORP CALIFORNIA
C/O AUXILIARY POWER INT'L CORP
0000 XXXXXX XX
XXX XXXXX, XXXXXXXXXX 00000
XXXXXXXX SUNDSTRAND WORLDWIDE REPAIR FLORIDA
MIRAMAR REPAIR STATION
0000 XXXXXXXX XXXX
XXXXXXX, XXXXXXX 00000
XXXXXXXX SUNDSTRAND ILLINOIS
ROCKFORD REPAIR STN
0000 XXXXXXXX XXXXXX
XXXXXXXX, XXXXXXXX 00000
HIGH STANDARD AVIATION FLORIDA
0000 X.X. 00XX XXXXXX
XXXXX, XXXXXXX 00000
HONEYWELL ARIZONA
XXXXXXX AIRLINE SERVICES DIV
0000 XXXX XXX XXXXXX XXXXXX
XXXXXXX, XXXXXXX 00000
HONEYWELL FLORIDA
0000 XXXX XXXXXXX XXXXX XXXX
XX XXXXXXXXXX, XXXXXXX 00000
HONEYWELL AEROSPACE OHIO
XXXXXX LIGHTING PRODUCTS
000 XXXXX XXXXXX
XXXXXX, XXXX 00000
HONEYWELL AEROSPACE ARIZONA
AEROSPACE EQUIPMENT SYSTEMS
0000 X. XXXXXX XX
XXXXX, XXXXXXX 00000
HONEYWELL AEROSPACE CALIFORNIA
TORRENCE REPAIR AND OVERHAUL
0000 XXXX 000XX XXXXXX
XXXXXXXX, XXXXXXXXXX 00000
HONEYWELL AEROSPACE SERVICES ALABAMA
XXX XXXXX XXXXXXX
XXXXXXXX, XXXXXXX 00000
-9-
HONEYWELL AEROSPACE SERVICES OKLAHOMA
TULSA HEAT TRANSFER OPERATIONS
0000 XXXXX XXXXXXXX XXXXXX
XXXXX, XXXXXXXX 00000-0000
HONEYWELL AEROSPACE NORTH CAROLINA
ENGINE SYSTEMS & ACCY DIV
0000 X. XXXXXXXX XXXX.
XXXXX XXXXX, XXXXX XXXXXXXX 00000
HONEYWELL INC MINNESOTA
MINNEAPOLIS SUPPORT CENTER
0000 XXXXXXXXX XXXXXXXXX
XXXXXXXXXXX, XXXXXXXXX 00000-0000
HONEYWELL INC KANSAS
SPERRY COMMERCIAL AVIONICS DIV
0000 XXXXXXXXXX XXXXXX
XXXXXXX, XXXXXX 00000
HONEYWELL INC ARIZONA
COMMERCIAL FLIGHT SYSTEMS GRP
AIR TRANSPORT SYSTEMS DIVISION
00000 XXXXX 00 XXXXXX
XXXXXXX, XXXXXXX 00000-0000
HONEYWELL INC. TEXAS
DALLAS SUPPORT CENTER
0000 XXXXXXXXXX XXXXX
XXXXXX, XXXXX 00000
HONEYWELL, INC. WASHINGTON
COMMERCIAL FLIGHT SYSTEMS GRP
0000 XXXX XXXXXX X.X.
XXXXXX, XXXXXXXXXX 00000
HRD AERO SYSTEMS, INC. CALIFORNIA
00000 XXXX XXXXX
XXXXXXXX, XXXXXXXXXX 00000
HSI ELECTRIC INC. HAWAII
0000 XXXXXXXX XXXXX
XXXXXXXX, XXXXXX 00000
-10-
HYDRO-AIRE, INC CALIFORNIA
0000 XXXXXX XXXXXX
XXXXXXX, XXXXXXXXXX 00000
IDD AEROSPACE CORPORATION WASHINGTON
00000 X.X. 00XX XXXXXX
XXXXXXX, XXXXXXXXXX 00000
INTEGRATED AEROSPACE SYSTEMS DIVISION CALIFORNIA
FORMERLY TRIG AEROSPACE
0000 XXXX XXXX XXXX
XXXXX XXX, XXXXXXXXXX 00000
INTERNATIONAL AEROSPACE TUBES, LLC INDIANA
0000 XXXXXXXX XXXXXX
XXXXXXXXXXXX, XXXXXXX 00000
JAMCO AMERICA INC. WASHINGTON
0000 00XX XXXXXX X. X.
XXXXXXX, XXXXXXXXXX 00000-0000
JET SYSTEMS, INC. WASHINGTON
14 N.E. XXXX
XXXXXX, XXXXXXXXXX 00000
XXXXX, XXXXXX, & CO NORTH CAROLINA
AEROSPACE OPERATIONS
0000 XXXXXXX XXXX XX
XXXXXX, XXXXX XXXXXXXX 00000
X. X. XXXXX COMPANY CALIFORNIA
0000 XXXXXXX XXX.
XXXXXXXXX, XXXXXXXXXX 00000
X-0 XXXXXXXXXXXXX XXXXXXX
(FORMERLY XXXXXXXX AEROSPACE)
0000 X.X. 00XX XXXXXX
XX. XXXXXXXXXX, XXXXXXX 00000
XXXXX CORPORATION CALIFORNIA
MSC DEPARTMENT
0000 XXXXXXXXXXXX XXXXXX
XXXXX XXXX, XXXXXXXXXX 00000
-11-
LIFERAFT AND MARINE SAFETY EQUIPEMT HAWAII
000 XXXXXX XXXXX
XXXXXXXX, XXXXXX 00000
L3 COMMUNICATION FLORIDA
0000 X.X. 00XX XXXXXX
XX.XXXXXXXXXX, XXXXXXX 00000
MARATHONNORCO AEROSPACE INC. TEXAS
FORMERLY MARATHON POWER TECH
0000 XXXXXXXX XXXXX
XXXX, XXXXX 00000
MATSUSHITA AVIONICS SYSTEM WASHINGTON
22333 00XX XX X.X.
XXXXXXX, XXXXXXXXXX 00000
MEDSPACE ARIZONA
00000 XXXXX 00XX XXXXX, XXXXX 00
XXXXXXX, XXXXXXX 00000
MEGGITT AVIONICS INC NEW HAMPSHIRE
00 XXXXX XXXXX
XXXXXXXXXX, XXX XXXXXXXXX 00000-0000
METAL IMPROVEMENT CO INC. CALIFORNIA
LOS ANGELES DIVISION
0000 XXXX 00XX XXXXXX
XXXXXX, XXXXXXXXXX 00000-0000
MICHELIN AIRCRAFT TIRE CORPORATION MICHIGAN
0000 XX 00XX XXXXXXX
XXXXXX XXXX, XXXXXXXX 00000
MONOGRAM SANITATION CALIFORNIA
A NORTEK COMPANY
000 X. XXXXXXX XXXXXXXXX
XXXXXXX, XXXXXXXXXX 00000-0000
MPC PRODUCTS CORP. ILLINOIS
0000 X. XXXXXX XXXXXX
XXXXXX, XXXXXXXX 00000
-12-
MPC PRODUCTS CORP. ILLINOIS
0000 X XXXXXXX XXXXXX
XXXXXX, XXXXXXXX 00000
NEOSOURCE INC OKLAHOMA
0000 XXXX 00XX XXXXXX
XXXXX, XXXXXXXX 00000
NORDAM DIVISION OKLAHOMA
00000 X. XXXXXX
XXXXX, XXXXXXXX 00000
NORTHEAST AERO COMPRESSOR CORP. NEW YORK
00 XXXXXXX XXXXX
XXXXXXX, XXX XXXX 00000
PACIFIC AERO TECH, INC. WASHINGTON
00000 00XX XXXXXX XXXXX
XXXX, XXXXXXXXXX 00000
PACIFIC SCIENTIFIC FLORIDA
00000 XX 000XX XXXX
XXXXX 0
XXXXX, XXXXXXX 00000
PANASONIC AVIONICS CORPORATION WASHINGTON
22333 29TH DR. XX
XXXX X-000
XXXXXXX, XXXXXXXXXX 00000
XXXXXX XXXXXXX CORPORATION NEW YORK
GULL ELECTRONIC SYSTEMS DIV.
000 XXXXXX XXXX
XXXXXXXXX, XXX XXXX 00000
PARKER HANNIFIN CORPORATION CALIFORNIA
PRODUCT SUPPORT DIVISION
00000 XXXXX XXXXXXX
XXX X
XXXXXX, XXXXXXXXXX 00000
XXXXX & WHITNEY CONNECTICUT
000 XXXX XXXXXX
RECEIVING WELL#3
XXXX XXXXXXXX, XXXXXXXXXXX 00000
-13-
XXXXX & XXXXXXX CONNECTICUT
OVERHAUL AND REPAIR CENTER
000 XXXXXXX XXXXX
XXXXXXXX, XXXXXXXXXXX 00000
XXXXX & WHITNEY AUTOAIR INC MICHIGAN
0000 XXXXXXXXXX XXXXX
XXXXXXX, XXXXXXXX 00000-0000
RADIANT POWER CORPORATION FLORIDA
0000 XXXXXXXX XXXXX
XXXXX X
XXXXXXXX, XXXXXXX 00000
ROCKWELL XXXXXXX INC FLORIDA
MIAMI STRATEGIC REPAIR CENTER
0000 XXXXXXXXX XXXXXX XXXXX
"XXXXX X"
XXXXX, XXXXXXX 00000
ROCKWELL XXXXXXX SERVICE CENTER GEORGIA
0000 XXXXXXXXXX XXXXXXX
XXXXXXX, XXXXXXX 00000-0000
ROLLS-ROYCE DEUTSCHLAND GMBH FLORIDA
C/O UNISON INDUSTRIES
0000 XXXXXXXXXX XXX
XXXXXXXXXXXX, XXXXXXX 00000
ROLLS-ROYCE DEUTSCHLAND GMBH CONNECTICUT
C/O EATON CORPORATION
PRESSURE SENSOR DIVISION
00 XXXXXX XXXXXX
XXXXXX, XXXXXXXXXXX 00000
ROLLS-ROYCE DEUTSCHLAND GMBH INDIANA
C/O BAE SYSTEMS CONTROLS
DOCK 1, 0000 XXXXXX XX
XX. XXXXX, XXXXXXX 00000
ROSEMOUNT AEROSPACE INC. MINNESOTA
00000 XXXXXXXX XXXX
XXXXXXXXXX, XXXXXXXXX 00000-0000
-14-
ROSEMOUNT AEROSPACE INC. MINNESOTA
XXXXXXXX CORPORATION
0000 XXXXX XXXX
XXXXX, XXXXXXXXX 00000
XXXXX TECHNOLOGIES, INC. CALIFORNIA
AVOX
0000 XXXXXXX XXX
XXX XXXX, XXXXXXXXXX 00000
XXXXXXXX PRECISION PRODUCT, INC. VERMONT
SUBS OF XX XXXXXXXX
000 XXXXXX XXXX
XXXXXXXXX, XXXXXXX 00000-0000
SMITHS INDUSTRIES AEROSPACE FLORIDA
00000 XXXXXXXXX XXXX, XXXX X
XXXXXXXXXX, XXXXXXX 00000
SOUNDAIR, INC. WASHINGTON
0000 XXXXXXXX XXX.
XXXXXXXXX, XXXXXXXXXX 00000
SUNRISE AVIONICS INC ARIZONA
000 X. XXXXXXXXX, XXXXX 00
XXXXXXX, XXXXXXX 00000
SUNVAIR OVERHAUL, INC. CALIFORNIA
SUNVALLY MACHINE WORKS
00000 XXX. XXXXXXXX
XXXXXXXX, XXXXXXXXXX 00000
THALES AVIONICS INC. WASHINGTON
FORMERLY AIR LABS
000 XXXXXXXX XXXXX
XXXXXXX, XXXXXXXXXX 00000
THALES AVIONICS, INC. NEW JERSEY
FORMERLY THOMSON-CSF SEXTANT
0000 XXXX XXXXXX
XXXXXX, XXX XXXXXX 00000
-15-
TRIUMPH ACCESSORY SERVICES KANSAS
XXXXX ELECTRO-AIR CORPORATION
000 XXXXX XXXX XXXX
XXXXXXXXXX, XXXXXX 00000
TRIUMPH AIR REPAIR ARIZONA
0000 XXXXX 00XX XXXXX
XXXXXXX, XXXXXXX 00000-0000
TRIUMPH AIRBORNE STRUCTURES ARKANSAS
WAS AIRBORNE NACELLE SVS.
000 XXXXXXXXXX XXXXX
XXX XXXXXXX, XXXXXXXX 00000
TURBINE CONTROLS, INC CONNECTICUT
#0 XXX XXXXXXX XXXX
XXXXXXXXXX, XXXXXXXXXXX 00000-0000
UNICORP SYSTEMS, INC. OKLAHOMA
0000 XXXX 00XX XXXXX
XXXXX, XXXXXXXX 00000-0000
UNISON INDUSTRIES FLORIDA
0000 XXXXXXXXXX XXX
XXXXXXXXXXXX, XXXXXXX 00000
UNISON INDUSTRIES SERVICE CENTER NEW YORK
0000 XXXXX XXXXXXX 00
XXXXXXX, XXX XXXX 00000
XXXXX AIRCRAFT TEXAS
0000 XXXXX XXXXX
XXXXXXXXXXX, XXXXX 00000
XXXXXXXX GOVERNOR CO. ILLINOIS
ONE XXXXXXXX WAY
(P. O. XXX 000) XXXXXXX, XXXXXXXX 00000-0000
WORLDWIDE LLC FLORIDA
0000 XX 00XX XXX
XXXXX, XXXXXXX 00000
-16-
SCHENKER INC. WASHINGTON
000 XXXXX 000XX XXXXXX, XXXXX 000
XXX-XXX, XX 00000
-17-
SCHEDULE 1.1(E)
ENGINES
None.
EXHIBIT A
SUPPLEMENTAL SCHEDULE
SUPPLEMENTAL SCHEDULE NO. _____________, dated as of______________,
____, by HAWAIIAN AIRLINES, INC., a Delaware corporation ("Grantor"), in favor
of CANYON CAPITAL ADVISORS LLC, a Delaware limited liability company, in its
capacity as agent for the Lender Group defined in the Engine and Spare Parts
Security Agreement defined below (in such capacity, together with its
successors, if any, in such capacity, "Agent").
Grantor has heretofore executed that certain Engine and Spare Parts
Security Agreement in favor of Agent, dated as of June 1, 2005 (the "Engine and
Spare Parts Security Agreement"), recorded with the Federal Aviation
Administration on ______________________, 20__ with Conveyance No. ________. The
Engine and Spare Parts Security Agreement contemplates the execution and
delivery from time to time of Supplemental Schedules to Schedule 1.1(S) of the
Engine and Spare Parts Security Agreement by Grantor in favor of Agent thereto
for the purpose of subjecting to the Lien of the Engine and Spare Parts Security
Agreement additional Spare Parts.
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed thereto in the Engine and Spare Parts Security Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Grantor hereby agrees as follows:
(a) Grantor hereby grants to Agent a continuing, second priority
Security Interest in, and Lien upon, subject only to the Liens of Bank Credit
Agent under the Bank Credit Documents, and Schedule 1.1(S) of the Engine and
Spare Parts Security Agreement is hereby amended to add thereto, the following
Spare Parts:
Spare Part Types
Spare Part Locations
(b) This Supplemental Schedule and its terms are hereby incorporated by
reference into the Engine and Spare Parts Security Agreement.
(c) This Supplemental Schedule is being delivered in the State of New
York and shall in all respects be governed by, and construed in accordance with,
the laws of the State of New York, including all matters of construction,
validity and performance.
[signature pages follow]
HAWAIIAN AIRLINES, INC.,
a Delaware corporation
By:
-----------------------------------
Name:
Title:
-2-
EXHIBIT B
SUPPLEMENTAL SCHEDULE
SUPPLEMENTAL SCHEDULE NO. _____________, dated as of______________,
____, by HAWAIIAN AIRLINES, INC., a Delaware corporation ("Grantor"), in favor
of CANYON CAPITAL ADVISORS LLC, a Delaware limited liability company, in its
capacity as agent for the Lender Group defined in the Engine and Spare Parts
Security Agreement defined below (in such capacity, together with its
successors, if any, in such capacity, "Agent").
Grantor has heretofore executed that certain Engine and Spare Parts
Security Agreement in favor of Agent, dated as of June 1, 2005 (the "Engine and
Spare Parts Security Agreement"), recorded with the Federal Aviation
Administration on ______________________, 20__ with Conveyance No. ________. The
Engine and Spare Parts Security Agreement contemplates the execution and
delivery from time to time of Supplemental Schedules to Schedule 1.1(E) of the
Engine and Spare Parts Security Agreement by Grantor in favor of Agent thereto
for the purpose of subjecting to the Lien of the Engine and Spare Parts Security
Agreement additional Engines.
Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed thereto in the Engine and Spare Parts Security Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Grantor hereby agrees as follows:
(a) Grantor hereby grants to Agent a continuing, second priority
Security Interest in and Lien upon, subject only to the Liens of Bank Credit
Agent under the Bank Credit Documents, and Schedule 1.1(E) of the Security
Agreement is hereby amended to add thereto, the following Engines:
<TABLE>
----------------------------------------------------------------------------------------------------------
Engine Manufacturer's Engine Engine
[Engine Manufacturer Serial No. Model No. Location]
------------------- ---------- --------- ---------
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
</TABLE>
(b) This Supplemental Schedule and its terms are hereby incorporated by
reference into the Security Agreement.
(c) This Supplemental Schedule is being delivered in the State of New
York and shall in all respects be governed by, and construed in accordance with,
the laws of the State of New York, including all matters of construction,
validity and performance.
[signature pages follow]
HAWAIIAN AIRLINES, INC.,
a Delaware corporation
By:
-----------------------------------
Name:
Title:
-2-
