RESTRICTED SHARE AGREEMENT
UNDER THE AIRCASTLE INVESTMENT LIMITED
2005 EQUITY AND INCENTIVE PLAN
[PURCHASED RESTRICTED SHARES]
This Award Agreement (this "Restricted Share Agreement"), dated as of
_______, 2006 (the "Date of Grant"), is made by and between Aircastle Investment
Limited, a Bermuda exempted company (the "Company") and [__________] (the
"Participant"). Capitalized terms not defined herein shall have the meaning
ascribed to them in the Aircastle Investment Limited 2005 Equity and Incentive
Plan (the "Plan"). Where the context permits, references to the Company shall
include any successor to the Company.
1. Grant of Restricted Shares. The Company hereby grants to the
Participant [________] Shares (such shares, the "Purchased Restricted Shares")
in exchange for payment by the Participant to the Company of US$[________],
subject to all of the terms and conditions of this Restricted Share Agreement
and the Plan.
2. Restrictions.
(a) All Purchased Restricted Shares shall be fully vested and
credited as fully paid at the time of payment in full of the amount specified in
Section 1 hereof. There will be no restrictions on sale, assignment, mortgage,
hypothecation, transfer, charge, pledge, encumbrance, gift, transfer in trust
(voting or other) or other disposition of, or creation of a security interest in
or lien on, any of the Purchased Restricted Shares or any agreement or
commitment to do any of the foregoing (each a "Transfer") with respect to the
Purchased Restricted Shares, whether voluntary or involuntary, by operation of
law or otherwise, except as set forth specifically in this Restricted Share
Agreement, including (i) Section 2(b) hereof, which provides that, upon
termination of the Participant's employment, the Participant can be required to
sell the Purchased Restricted Shares to the Company, subject to certain terms
and conditions, (ii) Section 13 hereof, which provides that no Purchased
Restricted Shares shall be sold, assigned, transferred, pledged, hypothecated or
otherwise disposed of prior to the end of the Lock-Up Period except as otherwise
expressly permitted under this Restricted Share Agreement, (iii) Section 14(a)
hereof, which provides that Participant's right to participate in certain sales
is subject to specified requirements and limitations, and (iv) Section 14(b)
hereof, which provides that Participant can be compelled to participate in
certain sales.
(b) Upon any termination of the Participant's employment with the
Company or any affiliate of the Company (unless, upon such termination,
Participant immediately becomes employed by the Company or another affiliate of
the Company) for any reason prior to the Public Offering Date (as defined in
Section 13(b) below) (a "Call Purchase Event"), subject to the provisions of
this Section 2(b), the Company may, at its option, exercisable by written notice
(a "Call Notice") delivered to the Participant (or in
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the case of a deceased Participant, the Participant's personal representative,
executor or administrator) within ninety (90) days after the applicable Call
Purchase Event (or, in the event the applicable Call Purchase Event is the death
of the Participant, within thirty (30) days after the appointment and
qualification of the deceased Participant's personal representative, if later),
elect to repurchase and, upon the giving of such notice, the Company shall be
obligated to repurchase and the Participant (and the related transferees, if
any, of the Participant or, in the case of a deceased Participant, his personal
representative, executor or administrator) (the "Seller") shall be obligated to
sell, all of the Restricted Purchased Shares held by the Seller at a per-Share
price equal to:
(i) if the Participant is terminated by the Company or an
affiliate for Cause, then the lower of (x) Fair Market
Value or (y) US$10;
(ii) if the Participant is terminated by the Company or an
affiliate without Cause, then Fair Market Value; or
(iii) if Participant's employment with the Company or any
affiliate terminates for any other reason, then US$10.
"Fair Market Value" of the Shares, on a per-Share basis, shall be determined as
of the time of the Call Purchase Event by the Board in good faith and shall be
final, conclusive and binding on all persons, including the Company and the
Seller; provided, however, that such determination shall be based upon the
Company as a going concern and shall not discount the value of such shares
either because they are subject to the restrictions set forth in this Restricted
Share Agreement or because they constitute only a minority interest in the
Company.
3. Adjustments. Pursuant to Section 5 of the Plan, in the event of a
change in capitalization as described therein, the Administrator shall make such
equitable changes or adjustments as it deems necessary or appropriate to the
number and kind of securities or other property (including cash) issued or
issuable in respect of outstanding Purchased Restricted Shares.
4. Legend on Certificates. The Participant agrees that any certificate
issued for Purchased Restricted Shares (or, if applicable, any book entry
statement issued for Purchased Restricted Shares) prior to the lapse of any
outstanding restrictions relating thereto shall bear the following legend (in
addition to any other legend or legends required under applicable federal and
state securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS UPON TRANSFER AND RIGHTS OF REPURCHASE (THE "RESTRICTIONS") AS
SET FORTH IN THE AIRCASTLE INVESTMENT LIMITED 2005 EQUITY AND INCENTIVE
PLAN AND A RESTRICTED SHARE AGREEMENT ENTERED INTO BETWEEN THE REGISTERED
OWNER AND AIRCASTLE INVESTMENT LIMITED, COPIES OF WHICH ARE ON FILE WITH
THE SECRETARY OF THE COMPANY. ANY ATTEMPT TO DISPOSE OF THESE SHARES IN
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CONTRAVENTION OF THE RESTRICTIONS, INCLUDING BY WAY OF SALE, ASSIGNMENT,
TRANSFER, PLEDGE, HYPOTHECATION OR OTHERWISE, SHALL BE NULL AND VOID AND
WITHOUT EFFECT AND SHALL RESULT IN THE FORFEITURE OF SUCH SHARES AS
PROVIDED BY SUCH PLAN AND AGREEMENT.
5. Certain Changes. The Administrator may adjust any of the terms of
the Purchased Restricted Shares; provided that, subject to Section 5 of the
Plan, no action under this Section shall adversely affect the Participant's
rights hereunder.
6. Notices. All notices and other communications under this Restricted
Share Agreement shall be in writing and shall be given by facsimile or first
class mail, certified or registered with return receipt requested, and shall be
deemed to have been duly given three days after mailing or 24 hours after
transmission by facsimile to the respective parties, as follows: (i) if to the
Company, c/o Aircastle Advisor LLC, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: General Counsel and (ii) if to the Participant, using
the contact information on file with the Company. Either party hereto may change
such party's address for notices by notice duly given pursuant hereto.
7. Securities Laws Requirements. The Company shall not be obligated to
issue Shares to the Participant free of the restrictive legend described in
Section 4 hereof or of any other restrictive legend, if such transfer, in the
opinion of counsel for the Company, would violate the Securities Act of 1933, as
amended (the "Securities Act") (or any other federal or state statutes having
similar requirements as may be in effect at that time).
8. No Obligation to Register. The Company shall be under no obligation
to register the Purchased Restricted Shares pursuant to the Securities Act or
any other federal or state securities laws.
9. Protections Against Violations of Agreement. Any purported Transfer
of Purchased Restricted Shares or any economic benefit or interest therein in
violation of this Restricted Share Agreement shall be null and void ab initio,
and shall not create any obligation or liability of the Company, and any person
purportedly acquiring any Purchased Restricted Shares or any economic benefit or
interest therein transferred in violation of this Restricted Share Agreement
shall not be entitled to be recognized as a holder of such Shares.
10. Taxes. The Participant understands that he or she (and not the
Company) shall be responsible for any tax liability that may arise as a result
of the transactions contemplated by this Restricted Share Agreement. The
Participant shall pay to the Company promptly upon request, and in any event at
the time the Participant recognizes taxable income in respect to the Purchased
Restricted Shares, an amount equal to the taxes the Company determines it is
required to withhold at the lowest applicable rate determined by the Company
under applicable tax laws with respect to the Purchased Restricted Shares. The
Participant may satisfy the foregoing requirement by making a payment to the
Company in cash or, with the approval of the Administrator, in its sole
discretion, by electing to have the Company repurchase Shares which the
Participant
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already owns and in such event the Company shall repurchase such number of
Shares having a value equal to the minimum amount of tax required to be
withheld. Such Shares shall be valued at their Fair Market Value on the date as
of which the amount of tax to be withheld is determined. Any fractional amounts
shall be settled in cash.
The Participant acknowledges that the tax laws and regulations applicable to the
Purchased Restricted Shares and the disposition of the Purchased Restricted
Shares following vesting are complex and subject to change, and it is the sole
responsibility of the Participant to obtain his or her own advice as to the tax
treatment of the terms of this Restricted Share Agreement.
BY SIGNING THIS AGREEMENT, THE PARTICIPANT REPRESENTS THAT HE OR SHE HAS
REVIEWED WITH HIS OR HER OWN TAX ADVISORS THE FEDERAL, STATE, LOCAL AND
FOREIGN TAX CONSEQUENCES OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT
AND THAT HE OR SHE IS RELYING SOLELY ON SUCH ADVISORS AND NOT ON ANY
STATEMENTS OR REPRESENTATIONS OF THE COMPANY OR ANY OF ITS AGENTS. THE
PARTICIPANT UNDERSTANDS AND AGREES THAT HE OR SHE (AND NOT THE COMPANY)
SHALL BE RESPONSIBLE FOR ANY TAX LIABILITY THAT MAY ARISE AS A RESULT OF
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
11. Failure to Enforce Not a Waiver. The failure of the Company to
enforce at any time any provision of this Restricted Share Agreement shall in no
way be construed to be a waiver of such provision or of any other provision
hereof.
12. Investment Representation. The Participant hereby represents and
warrants to the Company that the Participant, by reason of the Participant's
business or financial experience (or the business or financial experience of the
Participant's professional advisors who are unaffiliated with and who are not
compensated by the Company or any affiliate or selling agent of the Company,
directly or indirectly), (a) has the capacity to protect the Participant's own
interests in connection with the transactions contemplated under this Restricted
Share Agreement and (b) is capable of evaluating the merits and risks of the
purchase of the Purchased Restricted Shares. In addition, the Participant hereby
represents and warrants that (i) he or she has an individual net worth, or a
joint net worth with his or her spouse, as of the date hereof in excess of
US$1,000,000 and (ii) he or she had an individual income in excess of US$200,000
in each of the two most recent years or join income with his or her spouse in
excess of US$300,000 in each of those years and he or she has a reasonable
expectation of reaching the same income level in the current year.
13. Lock-Up.
(a) The Participant agrees that, during the period specified in
Section 13(b) (the "Lock-Up Period"), he or she will not offer, sell, contract
to sell, charge, pledge, grant any option to purchase, make any short sale or
otherwise dispose of any Purchased Restricted Shares (the "Locked-Up Shares"),
except as set forth in Section
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13(d) hereof or Section 14(a) or 14(b) hereof. The foregoing restriction is
expressly agreed to preclude the Participant from engaging in any hedging or
other transaction which is designed to or which reasonably could be expected to
lead to or result in a sale or disposition of the Locked-Up Shares even if such
Shares would be disposed of by someone other than the Participant. Such
prohibited hedging or other transactions would include without limitation any
short sale or any purchase, sale or grant of any right (including without
limitation any put or call option) with respect to any of the Locked-Up Shares
or with respect to any security that includes, relates to, or derives any
significant part of its value from such shares.
(b) The initial Lock-Up Period will commence on the Date of Grant
and continue for 120 days after the initial Public Offering (as defined in
Section 14(a) hereof) date set forth on the final prospectus used to sell the
Shares (the "Public Offering Date"); provided, however, that if (i) during the
last 17 days of the initial Lock-Up Period, the Company releases earnings
results or announces material news or a material event or (ii) prior to the
expiration of the initial Lock-Up Period, the Company announces that it will
release earnings results during the 15-day period following the last day of the
initial Lock-Up Period, then in each case the Lock-Up Period will be
automatically extended until the expiration of the 18-day period beginning on
the date of release of the earnings results or the announcement of the material
news or material event, as applicable, unless the initial Public Offering
underwriters each waives, in writing, such extension.
(c) The Participant further agrees that, prior to engaging in any
transaction or taking any other action that is subject to the terms of this
Restricted Share Agreement during the period from the Date of Grant to and
including the 34th day following the expiration of the initial Lock-Up Period
(except in accordance with Section 14(a) or 14(b) hereof), it will give notice
thereof to the Company and will not consummate such transaction or take any such
action unless it has received written confirmation from the Company that the
Lock-Up Period (as such may have been extended pursuant to the previous
paragraph) has expired.
(d) Notwithstanding the foregoing, if the Purchased Restricted
Shares are otherwise vested and transferable pursuant to this Restricted Share
Agreement, then the Participant may transfer the Locked-Up Shares (i) as a bona
fide gift or gifts, provided that the donee or donees thereof agree to be bound
in writing by the restrictions set forth herein, (ii) to any trust for the
direct or indirect benefit of the Participant or the immediate family of the
Participant, provided that the trustee of the trust agrees to be bound in
writing by the restrictions set forth herein, and provided further that any such
transfer shall not involve a disposition for value, or (iii) with the prior
written consent of the Company. For purposes of this Section 13, "immediate
family" shall mean any relationship by blood, marriage or adoption, not more
remote than first cousin. The Participant also agrees and consents to the entry
of stop transfer instructions with the Company's transfer agent and registrar
against the transfer of the Locked-Up Shares except in compliance with the
foregoing restrictions or in accordance with Section 14(a) or 14(b) hereof.
(e) The Participant understands that the Company is relying
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upon the Participant's agreement in this Section 13 in proceeding toward
consummation of the initial Public Offering. The Participant further understands
that Participant's agreement in this Section 13 is irrevocable and shall be
binding upon the Participant's heirs, legal representatives, successors, and
assigns.
14. Tag Along and Drag Along Rights.
(a) Tag Along Rights. Prior to the initial Public Offering by the
Company, in the event that the Fortress Shareholders (as defined in this
Section) shall propose to transfer, in one or more transactions, more than 50%
of the Shares they collectively own to a third party or third parties (other
than another Fortress Shareholder) (a "Proposed Purchaser"), the Participant
shall have the right and option (the "Tag Along Right"), but not the obligation,
to participate in such sale, at the same price (which shall take into account
all consideration proposed to be paid by the Proposed Purchaser to the Fortress
Shareholders in such sale) and on the same terms and subject to the same
conditions as the sale proposed by the Fortress Shareholders, by transferring up
to the same proportion of the Purchased Restricted Shares acquired by the
Participant pursuant to this Agreement as the proportion of Fortress
Shareholders' Shares that shall be transferred in such sale. Fortress
Shareholders shall notify the Company and the Participant in writing of any such
proposed sale at least thirty (30) days prior to the proposed effective date of
such proposed sale, which notice shall specify the name and address of the
Proposed Purchaser in such sale, (ii) the proposed purchase price to be paid by
the Proposed Purchaser in such sale, (iii) the other material terms and
conditions of such proposed sale, (iv) the proposed effective date of the
proposed sale and (vi) that the Proposed Purchaser has been informed of the Tag
Along Right and has agreed to purchase the Participant's Shares. The Participant
may exercise the Tag Along Right in respect of any such sale by notifying the
Company and the Fortress Shareholders in writing within ten (10) days following
notice from the Fortress Shareholders described in the preceding sentence, but
in any event no later than fifteen (15) days prior to the proposed effective
date of such proposed sale, and, thereafter, shall be irrevocably bound to
participate in such sale on such terms and shall execute and deliver any
purchase agreement or other certificate, instrument or other agreement required
by the Proposed Purchaser to consummate the proposed sale. For purposes of this
Agreement, (i) "Fortress Shareholder" shall have the same meaning as Permitted
Transferee, and shall include the FIG Funds, as each such term is defined in the
Plan, that currently own Shares; and (ii) "Public Offering" shall mean an
offering of equity securities of the Company pursuant to an effective
registration statement under the Securities Act, including an offering in which
the Fortress Stockholders are entitled to sell Shares.
(b) Drag Along Rights. Prior to the initial Public Offering by
the Company, in the event that the Fortress Shareholders shall propose to
transfer, in one or more transactions, more than 50% of the Shares they
collectively own to a Proposed Purchaser, the Fortress Shareholders shall have
the right and option (the "Drag Along Right"), but not the obligation, to compel
the Participant to participate in such sale, at the same price (which shall take
into account all consideration proposed to be paid by the Proposed Purchaser to
the Fortress Shareholders in such sale) and on the same terms and subject to the
same conditions as the sale proposed by the Fortress Shareholders, by
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transferring up to the same proportion of the Purchased Restricted Shares
acquired by the Participant pursuant to this Agreement as the proportion of the
Fortress Shareholders' Shares that shall be transferred in such sale. Fortress
Shareholders may exercise the Drag Along Right in respect of any such sale by
notifying the Company and the Participants in writing no later than fifteen (15)
days prior to the proposed effective date of such proposed sale of (i) the
proposed purchase price to be paid by the Proposed Purchaser in such sale, (ii)
the other material terms and conditions of such proposed sale and (iii) the
proposed effective date of the proposed sale. Upon receipt of such notice, the
Participant shall execute and deliver any purchase agreement or other
certificate, instrument or other agreement required by the Proposed Purchaser to
consummate the proposed sale on or prior to the proposed effective date.
15. Governing Law. This Restricted Share Agreement shall be governed
by and construed according to the laws of Bermuda.
16. Incorporation of Plan. The Plan is hereby incorporated by
reference and made a part hereof, and the Purchased Restricted Shares and this
Restricted Share Agreement shall be subject to all terms and conditions of the
Plan and this Restricted Share Agreement.
17. Amendments; Construction. The Administrator may amend the terms of
this Restricted Share Agreement prospectively or retroactively at any time, but
no such amendment shall impair the rights of the Participant hereunder without
his or her consent. To the extent the terms of Section 12 above conflict with
any prior agreement between the parties related to such subject matter, the
terms of Section 12 shall supersede such conflicting terms and control. Headings
to Sections of this Restricted Share Agreement are intended for convenience of
reference only, are not part of this Restricted Share Agreement and shall have
no affect on the interpretation hereof.
18. Survival of Terms. This Restricted Share Agreement shall apply to
and bind the Participant and the Company and their respective permitted
assignees and transferees, heirs, legatees, executors, administrators and legal
successors.
19. Rights as a Shareholder. During the period until the restrictions
on Transfer of the Restricted Share lapse as provided in Section 2(a) hereof,
the Participant shall have all the rights of a shareholder with respect to the
Purchased Restricted Shares save only the right to Transfer the Purchased
Restricted Shares. Accordingly, the Participant shall have the right to vote the
Purchased Restricted Shares and to receive any ordinary dividends paid to or
made with respect to the Purchased Restricted Shares.
20. Agreement Not a Contract for Services. Neither the Plan, the
granting of the Purchased Restricted Shares, this Restricted Share Agreement nor
any other action taken pursuant to the Plan shall constitute or be evidence of
any agreement or understanding, express or implied, that the Participant has a
right to continue to provide services as an officer, director, employee,
consultant or advisor of the Company or any Subsidiary or Affiliate for any
period of time or at any specific rate of compensation.
21. Authority of the Administrator; Disputes. The Administrator shall
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have full authority to interpret and construe the terms of the Plan and this
Restricted Share Agreement. The determination of the Administrator as to any
such matter of interpretation or construction shall be final, binding and
conclusive.
22. Representations. The Participant has reviewed with the
Participant's own tax advisors the Federal, state, local and foreign tax
consequences of the transactions contemplated by this Restricted Share
Agreement. The Participant is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents. The
Participant understands that he or she (and not the Company) shall be
responsible for any tax liability that may arise as a result of the transactions
contemplated by this Restricted Share Agreement.
23. Severability. Should any provision of this Restricted Share
Agreement be held by a court of competent jurisdiction to be unenforceable, or
enforceable only if modified, such holding shall not affect the validity of the
remainder of this Restricted Share Agreement, the balance of which shall
continue to be binding upon the parties hereto with any such modification (if
any) to become a part hereof and treated as though contained in this original
Restricted Share Agreement.
24. Acceptance. The Participant hereby acknowledges receipt of a copy
of the Plan and this Restricted Share Agreement. The Participant has read and
understands the terms and provisions of the Plan and this Restricted Share
Agreement, and accepts the Purchased Restricted Shares subject to all the terms
and conditions of the Plan and this Restricted Share Agreement. The Participant
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Administrator upon any questions arising under this
Restricted Share Agreement.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Restricted Share Agreement on the day and year first above written.
AIRCASTLE INVESTMENT LIMITED
By
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Name
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Title
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[NAME]
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The Participant
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