Exhibit 10.63
PHC 90-047 WKH
_______________________________________________________________________________
AIRCRAFT LEASE AGREEMENT
PHC 90-047 WKH
between
POLARIS HOLDING COMPANY
Lessor
and
Aloha Airlines, Inc.
Lessee
One Boeing Model 737-2M6C Aircraft
_______________________________________________________________________________
PHC 90-047 WKH
INDEX
SECTION SECTION HEADING
P. Parties
1. Definitions
2. Lease and Conditions
3. Delivery and Acceptance; Term
4. Rent
5. Representations and Warranties
6. Possession and Use
7. Information
8. Covenants of Lessee
9. Replacement of Parts; Alterations,
Modifications and Additions
10. General Tax Indemnity
11. Casualty Occurrences
12. Insurance
13. Indemnification
14. Liens
15. Perfection of Title and Further Assurances
16. Return of Aircraft and Records
17. Events of Default
18. Remedies
19. Alienation
20. Miscellaneous
S. Signature Page
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PHC 90-047 WKH
Exhibits
Exhibit A - Schedule and Description of Aircraft
Exhibit A-1 - Additional Equipment
Exhibit A-2 - Documents Delivered on the Delivery Date
Exhibit B - Aircraft Documents
Exhibit C - Definitions and Values
Exhibit D - Lease Supplement
Exhibit E - Return Condition Requirements
Exhibit F - List of Permitted Air Carriers
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PHC 90-047 WKH
AIRCRAFT LEASE AGREEMENT
THIS AGREEMENT dated as of July 16, 1990 PHC 90-047 WKH (Lease),
between POLARIS HOLDING COMPANY, a Delaware corporation, with its principal
place of business at Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (Lessor), and Aloha Airlines, Inc., a corporation organized
under the laws of the State of Hawaii, with its principal place of business
at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ (Lessee).
Lessee desires to lease from Lessor and Lessor is willing to lease
to Lessee the aircraft described herein upon and subject to the terms and
conditions of this Lease.
In consideration of the mutual promises herein, Lessor and Lessee
agree as follows:
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PHC 90-047 WKH
Section 1. DEFINITIONS.
The following terms shall have the following respective meanings
for all purposes of this Lease Agreement:
ADDITIONAL RENT shall mean the rent for the Aircraft specified on
Exhibit C and payable throughout the Term for the Aircraft pursuant to
Section 4(a).
AIRCRAFT shall mean the Airframe together with (i) the Engines,
whether or not installed on the Aircraft, (ii) all Parts or components
thereof, (iii) spare parts or ancillary equipment or devices furnished with
the Aircraft under this Lease (including the separate equipment described on
Exhibit A-1), (iv) all Aircraft Documents (except that the term "Aircraft"
as used in Section 3 of this Lease does not include Aircraft Documents, but
only those documents listed on Exhibit A-2), and (v) all substitutions,
replacements and renewals of any and all thereof.
AIRCRAFT DOCUMENTS shall mean the items identified on Exhibit B
hereto, all of which shall be maintained in the English language.
AIRFRAME shall mean (a) the aircraft described on Exhibit A, but
not including any Engine installed thereon, and (b) any and all Parts so
long as the same shall be incorporated or installed on or attached to the
Airframe, or so long as title thereto shall remain vested in Lessor in
accordance with the terms of Section 9, after removal from the Airframe.
APPRAISAL PROCEDURE, as used in Section 18, hereof, shall mean the
following procedure for determining the "fair market rental value" of the
Aircraft. "Fair market rental value" shall mean the value determined by an
appraisal completed on an "as is" and "where is" basis. Lessor shall select
an independent aircraft appraiser who shall make a determination of fair
market rental value. The fees and expenses of the appraiser shall be paid by
Lessee.
APPROVED INSURANCE BROKER shall mean any reputable insurance broker
of internationally recognized responsibility and standing specializing in
aircraft insurance.
APPROVED INSURER shall mean any reputable insurance company or
insurance broker of internationally recognized responsibility and standing
specializing in aircraft insurance.
BASIC RENT shall mean the rent for the Aircraft specified on
Exhibit C and payable throughout the Term for the Aircraft pursuant to
Section 4(a).
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▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇ RENT PAYMENT DATE shall mean the day for payment of Basic
Rent determined in accordance with Exhibit C. It is further understood and
agreed that if a Basic Rent Payment Date shall fall on a day which is not a
Business Day, any payment due on such Basic Rent Payment Date shall be made
on the next succeeding Business Day.
BUSINESS DAY shall mean any day other than a Saturday, Sunday or
other day on which banking institutions in San Francisco,
California or
Honolulu, Hawaii are authorized or required by law to be closed.
CASUALTY OCCURRENCE shall mean any of the following events with
respect to the Aircraft, Airframe or any Engine: (a) loss of such property or
its use due to theft or disappearance for a period in excess of sixty (60)
consecutive days or destruction, damage beyond economic repair or rendition
of such property permanently unfit for normal use by Lessee for any reason
whatsoever; (b) any damage to such property which results in an insurance
settlement with respect to such property on the basis of a total loss or on
the basis of a compromised or constructive total loss; (c) the condemnation,
confiscation, appropriation or seizure of, or requisition of title to such
property, or the use of such property by any Governmental Entity or purported
Governmental Entity, which in any such case shall have resulted in the loss
of possession thereof by Lessee for a period in excess of sixty consecutive
days (or for such shorter period ending on the date which is seven days from
the date of receipt of an insurance settlement with respect to such
property on the basis of a total loss); or (d) prohibition under any
applicable Law of the use of the Aircraft for commercial transportation of
passengers for a period of six (6) months; provided, however, that such
prohibition shall not be deemed a Casualty Occurrence for so long during the
Term hereof as Lessee shall elect to continue this Lease in effect, in the
event of which election all of Lessee's obligations hereunder shall continue
in full force and effect; provided, however, that notwithstanding the
immediately preceding proviso Lessee shall not have the right to so continue
this Lease during the twelve (12) month period ending on the Expiration
Date; provided, further, that if such prohibition terminates while the Lease
is in effect, this Lease shall remain in effect and continue in full force
and effect.
CERTIFICATED AIR CARRIER shall mean any Person (except the United
States Government) domiciled in the United States of America and holding a
certificate issued under Section 401 of the Federal Aviation Act by the
Department of Transportation or any predecessor or successor agency thereto,
or, in the event such certificates shall no longer be issued, any Person
(except the United States Government) domiciled in the United States of
America and legally engaged in the business of transporting passengers or
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cargo by air to, from or between points within the United States of America,
and, in either event, operating commercial jet aircraft.
CASUALTY VALUE shall mean the value as specified on Exhibit C
hereto.
DEFAULT shall mean an Event of Default or event which would
constitute an Event of Default but for the lapse of time or the giving of
notice or both.
DELIVERY DATE shall mean the date on which the Aircraft is
delivered to and accepted by Lessee for purposes of this Lease as set forth
on the Lease Supplement.
DELIVERY LOCATION shall mean the location specified on Exhibit C
hereto for the delivery of the Aircraft by Lessor to Lessee.
DOLLARS shall mean lawful currency of the United States of America.
ENGINE shall mean any Engine installed on or furnished with the
Aircraft on the Delivery Date, such Engine being identified as to
manufacturer, type and manufacturer serial number on Exhibit A hereto, any
Replacement Engine which may from time to time be substituted therefor
pursuant to Section 11 and any Substitute Engine which may be substituted
therefor pursuant to Section 16; together in each case with any and all
Parts incorporated or installed in or attached thereto or any and all Parts
removed therefrom so long as title thereto remains vested in Lessor in
accordance with the terms of Section 9 after removal from such Engine.
Except as otherwise set forth herein, at such time as a Replacement Engine
shall be so substituted, such replaced Engine shall cease to be an Engine
hereunder. The term "Engines" means, as of any date of determination, all
Engines then leased hereunder.
ESTIMATED DELIVERY DATE shall mean the date specified on Exhibit C
hereto, which the parties anticipate to be the Delivery Date.
EVENT OF DEFAULT shall have the meaning specified in any one or
more clauses in Section 17.
EXPIRATION DATE shall mean the date specified in the Lease
Supplement for expiration of the Term.
FAA shall mean the Federal Aviation Administration of the United
States Department of Transportation or any successor.
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▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ AVIATION ACT shall mean the United States Federal Aviation
Act of 1958, as amended.
GOVERNMENTAL ENTITY shall mean and include (i) the FAA; (ii) any
national government, or political subdivision thereof or local jurisdiction
therein; (iii) any board, commission, department, division, organ,
instrumentality, court, or agency of any entity described in (ii) above,
however constituted; and (iv) any association, organization, or institution
of which any entity described in (ii) or (iii) above is a member or to whose
jurisdiction any such entity is subject or in whose activities any such
entity is a participant but only (except for purposes of defining Law below)
to the extent that any of the preceding have jurisdiction over the Aircraft
or its operations.
GUARANTOR shall mean Aloha Airgroup, Inc.
INDEMNITEE shall mean Lessor, its officers, directors, agents and
employees and its successors and assigns.
INTERIM RENT for the Aircraft shall mean the rent determined as
provided on Exhibit C and payable on the Interim Rent Payment Date.
INTERIM RENT PAYMENT DATE shall mean the day determined in
accordance with Exhibit C.
INITIAL TERM shall mean the Initial Term specified on Exhibit C.
LAW shall mean and include (i) any statute, decree, constitution,
regulation, order, judgment or other directive of any Governmental Entity;
(ii) any treaty, pact, compact or other agreement to which any Governmental
Entity is a signatory or party; (iii) any judicial or administrative
interpretation or application of any Law described in (i) or (ii) above; and
(iv) any amendment or revision of any Law described in (i), (ii) or (iii)
above.
LEASE SUPPLEMENT shall mean the Lease Supplement, substantially in
the form of Exhibit D hereto, entered into between Lessor and Lessee.
LESSOR'S LIENS shall mean Liens arising as a result of (i) claims
against Lessor not related to the transactions contemplated by this Lease; or
(ii) acts of Lessor, not contemplated and expressly permitted under this
Lease; or (iii) Taxes imposed against Lessor which are not indemnified
against by Lessee pursuant to Section 10; or (iv) claims against Lessor
arising out of the
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PHC 90-047 WKH
voluntary transfer by Lessor of all or any part of its interests in the
Aircraft or this Lease, other than a transfer pursuant to Sections 11 or 18
hereof.
LIEN shall mean any mortgage, pledge, lien, charge, encumbrance,
lease, exercise of rights, security interest or claim.
MAINTENANCE PROGRAM shall mean an FAA approved maintenance program
as in effect from time to time for the Aircraft encompassing scheduled
maintenance, condition monitored maintenance and on-condition maintenance of
the Airframe, Engines, and components of the Aircraft. Upon request by Lessor
a copy of such Maintenance Program shall be made available to Lessor.
MORTGAGE CONVENTION shall mean the Convention for the International
Recognition of Rights in Aircraft, signed (ad referendum) at Geneva,
Switzerland, on June 19, 1948, and amended from time to time, but excluding
the terms of any adhesion thereto or ratification thereof containing
reservations to which the United States of America does not accede.
PARTS shall mean all appliances, components, parts, instruments,
appurtenances, accessories, furnishings and other equipment of whatever
nature (other than complete Engines or engines), which may now or from time
to time be incorporated or installed in or attached to the Airframe or any
Engine. Except as otherwise set forth herein, at such time as a replacement
part shall be substituted for a Part in accordance with Section 9 hereof,
the Part so replaced shall cease to be a Part hereunder.
PERMITTED AIR CARRIER shall mean those carriers listed on Exhibit
F, which (i) are meeting their debts as they mature; and (ii) are not
subject to any proceeding in bankruptcy and, "Permitted Air Carrier" shall
also mean a Certificated Air Carrier which (i) is meeting its debts as they
mature; (ii) is not subject to any proceeding in bankruptcy; and (iii) has a
net worth at least equal to Lessee's net worth, in both cases determined as
of the end of the most recent fiscal year preceding the effective date of
the proposed sublease as determined in accordance with generally accepted
accounting principles.
PERSON shall mean and include any individual person, corporation,
partnership, firm, joint stock company, joint venture, trust, estate,
unincorporated organization, association or Governmental Entity.
PURCHASE AGREEMENT shall mean that certain Purchase Agreement dated
the Delivery Date between Lessee, as purchaser, and Royal Brunei Airlines
SDN BHD as vendor, relating to the Aircraft.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ TERM shall mean the renewal term pursuant to Section 3(f)
hereof.
RENT shall mean Interim Rent, Basic Rent and Supplemental Rent,
collectively.
REPLACEMENT ENGINE shall mean an engine of the same manufacturer
and model, and having equivalent value, utility, modification and remaining
warranty status as the Engine it is intended to replace under Section 11(b)
hereof, or, at Lessee's option, an engine of the same manufacturer as such
Engine but of an improved model, and otherwise of an equivalent value and
utility and suitable for installation and use on the Airframe without
impairing the value or utility of the Airframe.
RETURN OCCASION shall mean the event that occurs when possession of
the Aircraft is returned from Lessee to Lessor at the end of the Term of
this Lease or upon Lessor taking possession pursuant to Section 18.
SUBSTITUTE ENGINE shall mean an engine of the same manufacturer and
model, and having equivalent value, utility, modification and remaining
warranty status as the Engine it is intended to replace under Section 16(c)
hereof, or, at Lessee's option, an engine of the same manufacturer as such
Engine but of an improved model, and otherwise of an equivalent value and
utility and suitable for installation and use on an Airframe without
impairing the value or utility of such Airframe.
SUPPLEMENTAL RENT shall mean any and all amounts, liabilities and
obligations (other than Interim Rent and Basic Rent) which Lessee assumes or
agrees to pay hereunder to Lessor, including without limitation, (i) any
payment of Casualty Value; (ii) any payment of indemnity required by Sections
10 and 13 hereof; and (iii) to the extent permitted by applicable Law,
interest at the Interest Rate (all computations of interest under this Lease
to be made on the basis of a 365-day year, or a 366-day year in the case of
leap years, for the actual number of days elapsed) calculated: (1) on any
part of any installment of Basic Rent not paid on the due date thereof for
the period the same remains unpaid and (2) on any Supplemental Rent not paid
when due hereunder until the same is paid.
TAXES shall mean any and all sales, use, business, gross income,
personal property, transfer, fuel, leasing, occupational, value added, excess
profits, excise, gross receipts, franchise, stamp, income, levies, imposts,
withholdings or other taxes or duties of any nature, together with any
penalties, fines, charges or interest thereon.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇ shall mean the term, in respect of the Aircraft, specified on
Exhibit C, for which such Aircraft is leased hereunder pursuant to Section 3,
including any Renewal Term or Terms.
The terms CASUALTY VALUE, COUNTRY OF ORGANIZATION, COUNTRY OF
REGISTRATION, ENGINE MANUFACTURER, INTEREST RATE, LAST BASIC RENT PAYMENT
Date, LEASE IDENTIFICATION, LESSEE'S ADDRESS, LESSOR'S ADDRESS, MANUFACTURER
and PAYMENT LOCATION shall have the meanings set forth on Exhibit C hereto.
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▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ 2. LEASE AND CONDITIONS.
(a) Lessor hereby agrees to lease the Aircraft to Lessee, and
Lessee hereby agrees to lease the Aircraft from Lessor, on the terms of this
Lease, as supplemented by the Lease Supplement.
(b) Lessor's obligation to lease the Aircraft hereunder to Lessee
shall be conditioned upon the absence of any Default hereunder, the
acquisition of the Aircraft on terms acceptable to Lessor and the receipt by
Lessor of the following documents on or before the Delivery Date for the
Aircraft, all of which shall be reasonably satisfactory in form and substance
to Lessor:
(1) a Lease Supplement in the form of Exhibit D completed,
executed and delivered by Lessee, and effective as of the Delivery Date of
the Aircraft;
(2) a certificate evidencing due authority of Lessee for
the execution, delivery and performance of this Lease and all other documents
related thereto, together with an incumbency certificate as to the person or
persons authorized to execute and deliver such documents on behalf of Lessee;
(3) a favorable opinion of Lessee's counsel, dated the
Delivery Date, in the form requested by Lessor;
(4) a certificate signed by a duly authorized officer of
Lessee, dated the Delivery Date, stating that: (i) the representations and
warranties contained in Section 5 (c) hereof are true and accurate on and as
of such date as though made on and as of such time; and (ii) no event has
occurred and is continuing, or would result from the lease of the Aircraft,
which constitutes a Default or an Event of Default;
(5) an opinion or report, dated the Delivery Date, signed
by an Approved Insurance Broker or Approved Insurer as to the due compliance
with the insurance provisions of Section 12 hereof with respect to the
Aircraft;
(6) certificates of an Approved Insurance Broker
evidencing the insurance as required by Section 12 hereof;
(7) a favorable opinion, from such counsel as may be
acceptable to Lessor, as to completion of the due filing of, or other action
with respect to, this Lease required to make a public record of the
respective interests of Lessor and Lessee in the Aircraft, and regarding such
other matters as Lessor may reasonably request;
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90-047 WKH
(8) such financial information concerning Lessee and any
Guarantor and other documents and matters incident to the foregoing as Lessor
may reasonably request;
(9) an irrevocable full performance guaranty, in form
acceptable to Lessor, of the obligations of Lessee hereunder issued by
Guarantor in favor of Lessor;
(10) an assignment of the Purchase Agreement, in form
acceptable to Lessor, executed and delivered by Lessee, and effective as of
the Delivery Date of the Aircraft;
(11) the Purchase Agreement, in form acceptable to Lessor,
executed by Lessee and Royal Brunei Airlines SDN BHD and delivered by Lessee,
and effective as of the Delivery Date of the Aircraft;
(12) an agreement regarding use of the Aircraft and
including a purchase option, in form acceptable to Lessor, executed and
delivered by Lessee, dated as of the date hereof; and
(13) a tax indemnification, in form acceptable to Lessor,
executed and delivered by Lessee, dated as of the date hereof.
(c) Lessee's obligation to lease the Aircraft hereunder from Lessor
shall be conditioned upon the receipt by Lessee of the following documents on
or before the Delivery Date for the Aircraft, all of which shall be
reasonably satisfactory in form and substance to Lessee:
(1) a Lease Supplement in the form of Exhibit D completed,
executed and delivered by Lessor, and effective as of the Delivery Date of
the Aircraft;
(2) a certificate evidencing due authority of Lessor for
the execution, delivery and performance of this Lease and all other documents
related thereto, together with an incumbency certificate as to the person or
persons authorized to execute and deliver such documents on behalf of Lessor;
(3) a favorable opinion of Lessor's counsel, dated the
Delivery Date, in the form requested by Lessee;
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(4) a certificate signed by a duly authorized officer of
Lessor, dated the Delivery Date, stating that: (i) the representations and
warranties contained in Section 5(a) hereof are true and accurate on and as
of such date as though made on and as of such time; and
(5) acquisition of the Aircraft by Lessor.
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Section 3. DELIVERY AND ACCEPTANCE; TERM.
(a) DELIVERY. It is anticipated that the Aircraft will become
available for delivery on or about the Estimated Delivery Date set forth on
Exhibit C.
(b) PLACE OF DELIVERY AND ACCEPTANCE. The Aircraft shall be
delivered to and accepted by Lessee at the Delivery Location set forth on
Exhibit C.
(c) CASUALTY TO THE AIRCRAFT PRECEDING DELIVERY. In the event of a
Casualty occurrence with respect to the Aircraft prior to its delivery, or
the termination of the Purchase Agreement as contemplated under Section 7
thereof, Lessor shall promptly notify Lessee in writing, and this Lease shall
terminate upon receipt of such written notice, provided, however, that for
the purposes of this Section 3(c), the Aircraft will be considered as damaged
beyond repair if repair cannot be accomplished within ninety (90) days of the
Estimated Delivery Date.
(d) ACCEPTANCE OF AIRCRAFT. The Aircraft to be leased hereunder
shall be delivered to Lessee, concurrently with the delivery of the Aircraft
to Lessor under the Purchase Agreement, "AS IS," "WHERE IS" and SUBJECT TO
EACH AND EVERY DISCLAIMER OF WARRANTY AND REPRESENTATION AS SET FORTH IN
SECTIONS 5(a) AND (b) HEREOF. Upon tender of delivery hereunder by Lessor,
Lessee shall accept delivery of the Aircraft. Upon acceptance of the Aircraft
Lessee shall thereupon indicate and confirm its acceptance of the Aircraft by
delivery to Lessor of a Lease Supplement, dated the Delivery Date, in the
form set forth as Exhibit D hereto.
(e) TERM OF LEASE. The Term of this Lease shall commence on the
Delivery Date and shall continue until the Expiration Date set forth in the
Lease Supplement; provided that this Lease may be earlier terminated or
extended pursuant to the provisions hereof.
(f) RENEWAL OPTION. Lessee may renew this Lease for one (1)
four-year period, with such Renewal Term to commence on the Expiration Date.
The renewal shall be upon the following conditions: (i) Lessee shall give
Lessor not less than one hundred eighty (180) days written notice prior to
the commencement of the Renewal Term; (ii) no Event of Default shall have
occurred and be continuing on the date of such notice or on the first day of
the Renewal Term; (iii) no Default shall have occurred and be continuing on
the date of such notice on the first day of the Renewal Term unless Lessee
gives Lessor notice of the nature of such Default and reasonable assurance
that appropriate actions are being taken which will prevent such Default from
becoming an Event of Default; and (iv) Basic Rent and the Additional Rent
during the Renewal Term shall be payable in the same amounts as during the
Initial Term.
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Section 4. RENT.
(a) RENT. Lessee covenants and agrees to pay to Lessor, or its
assigns, the following as Rent:
(i) INTERIM RENT: The Interim Rent as determined pursuant
to Exhibit C hereto in respect of the Aircraft on the Interim Rent Payment
Date.
(ii) BASIC RENT: The Basic Rent as set forth on Exhibit C
hereto throughout the Term hereof, payable in consecutive installments and
due on each Basic Rent Payment Date.
(iii) ADDITIONAL RENT: As set forth on Exhibit C hereto
throughout the Term hereof, payable in consecutive installments and due on
each Basic Rent Payment Date.
(iv) SUPPLEMENTAL RENT: Any and all Supplemental Rent as
the same becomes due.
(b) PLACE AND METHOD OF PAYMENT. All Interim Rent, Basic Rent,
Additional Rent and Supplemental Rent payable under this Lease shall be paid
in Dollars, at the Payment Location specified on Exhibit C hereto, or at such
other location as Lessor shall designate in writing.
(c) PROHIBITION AGAINST SETOFF, COUNTERCLAIM, Etc. This Lease is a
net lease. Lessee's obligation to pay all Rent hereunder shall be absolute
and unconditional and shall not be affected or reduced by any circumstances,
including, without limitation, (i) any setoff, counterclaim, recoupment,
defense or other right which Lessee may have against Lessor, the
Manufacturer, the Engine Manufacturer, any seller of or person providing
services with respect to the Aircraft or any other Person, for any reason
whatsoever; (ii) any defect in the title, airworthiness or eligibility for
registration under applicable Law, or any condition, design, operation or
fitness for use of, or any damage to or loss or destruction of, the Aircraft,
or any interruption or cessation in the use or possession thereof by Lessee
for any reason whatsoever, whether arising out of or related to an act or
omission of Lessee, or any other Person; (iii) any Liens with respect to the
Aircraft; (iv) the invalidity or unenforceability or lack of due
authorization or other infirmity of this Lease or any absence of right, power
or authority of Lessor or Lessee to enter into this Lease; (v) any
insolvency, bankruptcy, reorganization or similar proceedings by or against
Lessor or Lessee; (vi) any other circumstance or happening of any nature
whatsoever, similar to any of the foregoing; or (vii) any Taxes; it being the
express intention of Lessor and Lessee that all Rent payable hereunder
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shall be payable in all events, unless the obligation to pay the same shall
be terminated pursuant to the express provisions of this Lease.
Except as expressly provided herein, Lessee hereby waives, to the
extent permitted by applicable Law, any and all rights which it may now have
or which at any time hereafter may be conferred upon it, by Law or
otherwise, to terminate this Lease or any obligation imposed upon Lessee
hereunder or in relation hereto.
Nothing contained in this Section shall be construed as a waiver of
Lessee's right to seek a separate recovery of any payment of Rent which is
not due and payable in accordance with the terms of this Lease, or to bring a
separate action for damages or recovery of Rent.
If for any reason whatsoever this Lease shall be terminated in
whole or in part by operation of law, Lessee nonetheless agrees to pay to
Lessor amounts equal to the Rent payments hereunder at the time such payments
would have become due and payable in accordance with the terms hereof had
this Lease not been terminated, and so long as such payments are made and all
other terms and conditions hereof are complied with by Lessor and Lessee,
Lessor and Lessee will deem this Lease to remain in full force and effect.
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Section 5. REPRESENTATIONS AND WARRANTIES.
(a) WARRANTIES AND DISCLAIMER OF WARRANTIES.
LESSOR HAS NOT AND SHALL NOT BE DEEMED TO HAVE MADE (WHETHER BY
VIRTUE OF HAVING LEASED THE AIRCRAFT UNDER THIS LEASE, OR HAVING ACQUIRED THE
AIRCRAFT, OR HAVING DONE OR FAILED TO DO ANY ACT, OR HAVING ACQUIRED OR
FAILED TO ACQUIRE ANY STATUS UNDER OR IN RELATION TO THIS LEASE OR
OTHERWISE), AND LESSOR HEREBY SPECIFICALLY DISCLAIMS, ANY REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED, AS TO THE TITLE (EXCEPT AS HEREIN BELOW
PROVIDED), AIRWORTHINESS, CONDITION, DESIGN, OPERATION, MERCHANTABILITY,
FREEDOM FROM CLAIMS OF INFRINGEMENT OR THE LIKE, OR FITNESS FOR USE FOR A
PARTICULAR PURPOSE OF THE AIRCRAFT, OR AS TO THE QUALITY OF THE MATERIAL OR
WORKMANSHIP OF THE AIRCRAFT, THE ABSENCE THEREFROM OF LATENT OR OTHER
DEFECTS, WHETHER OR NOT DISCOVERABLE, OR AS TO ANY OTHER REPRESENTATION OR
WARRANTY WHATSOEVER, EXPRESS OR IMPLIED (INCLUDING ANY IMPLIED WARRANTY
ARISING FROM A COURSE OF PERFORMANCE OR DEALING OR USAGE OF TRADE), WITH
RESPECT TO THE AIRCRAFT; AND LESSEE HEREBY WAIVES, RELEASES, RENOUNCES AND
DISCLAIMS EXPECTATION OF OR RELIANCE UPON ANY SUCH WARRANTY OR WARRANTIES.
LESSOR SHALL NOT HAVE ANY RESPONSIBILITY OR LIABILITY TO LESSEE OR ANY OTHER
PERSON, WHETHER ARISING IN CONTRACT OR TORT OUT OF ANY NEGLIGENCE OR STRICT
LIABILITY OF LESSOR OR OTHERWISE, FOR (i) ANY LIABILITY, LOSS OR DAMAGE
INCLUDING ANY INTERRUPTION OF SERVICE, LOSS OF BUSINESS OR ANTICIPATED
PROFITS OR CONSEQUENTIAL DAMAGES CAUSED OR ALLEGED TO BE CAUSED DIRECTLY OR
INDIRECTLY BY THE AIRCRAFT OR ANY ENGINE OR BY ANY INADEQUACY THEREOF OR
DEFICIENCY OR DEFECT THEREIN OR BY ANY OTHER CIRCUMSTANCE IN CONNECTION
THEREWITH, (ii) THE USE, OPERATION OR PERFORMANCE OF THE AIRCRAFT OR ANY
RISKS RELATING THERETO, OR (iii) THE DELIVERY, OPERATION, SERVICING,
MAINTENANCE, REPAIR, IMPROVEMENT OR REPLACEMENT OF THE AIRCRAFT. THE
WARRANTIES AND REPRESENTATIONS SET FORTH IN THIS SECTION 5(a), WHICH
WARRANTIES AND REPRESENTATIONS SHALL SURVIVE THE EXECUTION AND DELIVERY OF
THIS LEASE AND THE DELIVERY OF THE AIRCRAFT, ARE EXCLUSIVE AND IN LIEU OF ALL
OTHER REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED, AND
LESSOR SHALL NOT BE DEEMED TO HAVE MADE ANY OTHER WARRANTIES, EXCEPT THAT:
(i) Lessor warrants that on the Delivery Date title to the
Aircraft shall be vested in Lessor and the Aircraft shall be free and clear
of any and all Lessor's Liens;
(ii) Lessor further represents and warrants that Lessor is
a corporation duly organized and validly existing and in good standing under
the laws of the State of Delaware, and has the corporate power and authority
to carry on its business as presently conducted and to perform its
obligations under this Lease;
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
(▇▇▇) Lessor further represents and warrants that the
making and performance by Lessor of this Lease have been duly authorized by
all necessary corporate action on the part of Lessor and will not violate any
provision of law or its Articles of Incorporation or By-Laws; and
(iv) Lessor further represents and warrants that this
Lease has been duly entered into and delivered by Lessor, and that this Lease
and the Lease Supplement when executed and delivered hereunder constitute
legal, valid and binding obligations of Lessor, enforceable in accordance
with their respective terms except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, and, to the extent that certain
remedies require or may require enforcement by a court of equity, by such
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law) as a court having jurisdiction may
impose and by laws which may affect some of such remedies but which do not
make available remedies inadequate for the substantial realization of the
benefits provided herein.
(b) MANUFACTURERS' WARRANTIES. So long as Lessee is not in default
and Lessor has not terminated this Lease, Lessor agrees to authorize Lessee
to exercise for the account of Lessor such rights as Lessor may have under
any warranty, express or implied, with respect to the Aircraft made by the
Manufacturer or the Engine Manufacturer, to the extent that the same may be
assigned or otherwise made available to Lessee; provided, however, that upon
an Event of Default and termination of this Lease all such rights shall
immediately revert to Lessor including all claims thereunder whether or not
perfected.
(c) LESSEE'S REPRESENTATIONS AND WARRANTIES. Lessee hereby makes
the following representations and warranties, which representations and
warranties shall survive the execution and delivery of this Lease and the
delivery of the Aircraft:
(i) Lessee is a corporation duly organized, and existing
in good standing under the Laws of the State of Hawaii and has the corporate
power and authority to carry on its business as presently conducted and to
perform its obligations under this Lease;
(ii) this Lease has been duly authorized by all necessary
corporate action on the part of Lessee, does not require any approval of
stockholders of Lessee (or if such approval is required, such approval has
been obtained), and neither the execution and delivery hereof nor the
consummation of the transactions contemplated hereby nor compliance by Lessee
with any of the terms and provisions hereof will contravene any Law
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PHC 90-047 WKH
applicable to Lessee or result in any breach of, or constitute any default
under, or result in the creation of any lien, charge or encumbrance upon any
property of Lessee under, any credit agreement or instrument, corporate
charter or by-law or other agreement or instrument to which Lessee is a party
or by which Lessee or its properties or assets are bound or affected;
(iii) Lessee has received every consent, approval or
authorization of, and has given every notice to, each Governmental Entity
having jurisdiction with respect to the execution, delivery or performance of
this Lease (including all monetary and other obligations hereunder) that is
required for Lessee to execute and deliver this Lease, and to perform the
transactions contemplated hereby;
(iv) this Lease has been duly executed and delivered by
Lessee, and the Lease, and the Lease Supplement, when executed and delivered
by Lessee, constitute legal, valid and binding obligations of Lessee,
enforceable in accordance with their respective terms, except as enforcement
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally, and, by general principles or equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law) as a
court having jurisdiction may impose and by laws which may affect some of
such remedies but which do not make the available remedies inadequate for the
substantial realization of the benefits provided herein;
(v) there are no suits or proceedings pending or, to the
knowledge of Lessee, threatened in any court or before any regulatory
commission, board or other administrative governmental agency against or
affecting Lessee which will have a materially adverse effect on the current
business or financial condition of Lessee;
(vi) Lessee has filed or caused to be filed all material
tax returns which are required to be filed by it, and has paid or caused to
be paid all taxes shown to be due or payable on said returns or on any
assessment received by Lessee, unless protected by appropriate proceedings;
(vii) except for the filing for recordation of this Lease
and the Lease Supplement with the FAA, the recording at the FAA of the FAA
▇▇▇▇ of Sale, the issuance of the FAA Certificate of Registration and the
filings of the UCC-1 forms to be made in Hawaii and
California and the
placing on the Aircraft and on each Engine of the plates containing the
legends referred to in Section 6(f) hereof, no further filing or recording of
this Lease or of any other document and no further action, is necessary or
desirable
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
under the Laws of any Governmental Entity in order to (A) fully protect and
establish Lessor's title to, interest in, and property rights with respect
to, the Aircraft as against Lessee or any third party and to ensure that the
property rights of Lessor therein will have priority in all respects over the
claims of all creditors of Lessee, or (B) ensure the validity, effectiveness
and enforceability of this Lease;
(viii) Lessee is not in default in the performance of any
of its obligations (a) for the payment of indebtedness for borrowed money in
a principal amount in excess of Five Hundred Thousand Dollars ($500,000) or
of any interest or premium thereon or (b) for the payment of rent under any
lease or agreement to lease real, personal or mixed property where the
aggregate rentals over the term thereof is more than Three Hundred Fifty
Thousand Dollars ($350,000);
(ix) the Maintenance Program will comply with all FAA
requirements;
(x) the consolidated financial statements of Lessee and
the Guarantor, including the balance sheets and audited statements of income
and retained earnings of Lessee and the Guarantor, for the preceding two
fiscal years, copies of which have been furnished to Lessor, are prepared in
accordance with generally accepted accounting principles, and present fairly
the financial position and operations of Lessee and the Guarantor, and
subsequent to the conclusion of the last such period, there has been no
material adverse change in such position or operations;
(xi) there is no withholding or other tax to be deducted
from any payment to be made by Lessee under this Lease;
(xii) the choice of
California law and United States
federal law to govern this Lease is a valid choice of law; and
(xiii) Lessor shall be entitled to the benefits of a
lessor under Title 11 U.S.C. Section 1110 as in effect on the date hereof,
and, as a consequence, any right of Lessor to take possession of such
Aircraft in compliance with the provisions of this Lease Agreement shall not
be affected by the provisions of Section 362 or 363 of such Title as in
effect on the date hereof.
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Section 6. POSSESSION AND USE.
To distinguish defined terms in this Section 6, the first letter of the
defined term is underlined.
(a) POSSESSION.
(i) SUBLEASE, ASSIGNMENT AND TRANSFER. LESSEE WILL NOT ASSIGN THIS
LEASE OR SUBLET OR TRANSFER POSSESSION OF THE AIRCRAFT, AIRFRAME, ANY ENGINE
OR ANY PART OR INSTALL ANY ENGINE OR ANY PART OR PERMIT ANY ENGINE OR ANY
PART TO BE INSTALLED ON ANY AIRFRAME OTHER THAN THE AIRFRAME, PROVIDED THAT
SO LONG AS NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING AND AS LONG AS THE ACTION TO BE TAKEN SHALL NOT AFFECT THE
REGISTRATION OF THE AIRCRAFT AND SO LONG AS ALL NECESSARY APPROVALS OF EACH
GOVERNMENTAL ENTITY HAVING JURISDICTION OVER THE AIRCRAFT HAVE BEEN OBTAINED,
THEN LESSEE:
(I.) WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR, MAY:
(1) SUBJECT ANY ENGINE AND ANY PART TO NORMAL INTERCHANGE OR POOLING
AGREEMENTS OR SIMILAR ARRANGEMENTS IN EACH CASE CUSTOMARY IN THE AIRLINE
INDUSTRY AND ENTERED INTO IN THE ORDINARY COURSE OF ITS BUSINESS WITH A
CERTIFICATED AIR CARRIER OR AN FAA LICENSED ENGINE OVERHAUL AGENCY, PROVIDED
THAT: (A) NO SUCH AGREEMENT OR ARRANGEMENT RESULTS IN OR REQUIRES THE
TRANSFER OF TITLE TO SUCH ENGINE OR SUCH PART; OR (B) IF LESSOR'S TITLE TO
SUCH ENGINE SHALL BE DIVESTED UNDER ANY SUCH AGREEMENT OR ARRANGEMENT, SUCH
DIVESTITURE SHALL BE DEEMED TO BE A CASUALTY OCCURRENCE WITH RESPECT TO SUCH
ENGINE AND LESSEE SHALL COMPLY WITH SECTION 11(b) HEREOF IN RESPECT THEREOF;
(2) DELIVER POSSESSION OF THE AIRCRAFT, THE AIRFRAME, ANY ENGINE OR
ANY PART TO THE MANUFACTURER THEREOF FOR TESTING OR OTHER SIMILAR PURPOSES OR
TO ANY ORGANIZATION FOR SERVICE, REPAIR, MAINTENANCE, TESTING OR OVERHAUL
WORK ON THE AIRCRAFT, AIRFRAME OR ENGINE OR ANY PART THEREOF OR FOR
ALTERATIONS OR MODIFICATIONS IN OR ADDITIONS TO THE AIRCRAFT, AIRFRAME OR
ENGINE TO THE EXTENT REQUIRED OR PERMITTED BY THE TERMS OF SECTION 9 HEREOF;
(3) INSTALL AN ENGINE ON AN AIRFRAME (OTHER THAN THE AIRFRAME)
OWNED BY LESSEE FREE AND CLEAR OF ALL LIENS EXCEPT: (A) THOSE LIENS OF THE
TYPE PERMITTED UNDER SECTION 14 HEREOF AND THOSE LIENS WHICH APPLY ONLY TO
THE ENGINES (OTHER THAN ENGINES), APPLIANCES, PARTS, INSTRUMENTS,
APPURTENANCES, ACCESSORIES, FURNISHINGS AND OTHER EQUIPMENT (OTHER THAN
PARTS) INSTALLED ON SUCH AIRFRAME (BUT NOT TO THE AIRFRAME AS AN ENTIRETY);
AND (B) THE RIGHTS OF THE PARTICIPANTS UNDER NORMAL INTERCHANGE AGREEMENTS
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇ ARE CUSTOMARY IN THE AIRLINE INDUSTRY AND DO NOT CONTEMPLATE, PERMIT,
RESULT IN OR REQUIRE THE TRANSFER OF TITLE TO THE AIRFRAME, ENGINES OR PARTS
INSTALLED THEREON;
(4) INSTALL AN ENGINE ON AN AIRFRAME LEASED TO LESSEE OR OWNED BY
LESSEE SUBJECT TO A CONDITIONAL SALE OR OTHER SECURITY AGREEMENT, PROVIDED,
THAT: (A) SUCH AIRFRAME IS FREE AND CLEAR OF ALL LIENS EXCEPT THE RIGHTS OF
THE PARTIES TO THE LEASE OR CONDITIONAL SALE OR OTHER SECURITY AGREEMENT
COVERING SUCH AIRFRAME AND EXCEPT LIENS OF THE TYPE PERMITTED BY CLAUSES (A)
AND (B) OF SECTION 6(a)(i)(I)(3), AND THE LIEN OF ANY MORTGAGE WHICH
EITHER BY ITS TERMS DOES NOT APPLY TO THE ENGINE OR WHICH EFFECTIVELY
PROVIDES THAT EACH ENGINE LEASED TO LESSEE HEREBY SHALL NOT BECOME SUBJECT TO
THE LIEN THEREOF OR TO ANY RIGHTS OF ANY PARTY THEREUNDER OTHER THAN LESSEE
(WITH RESPECT TO LESSEE'S RIGHTS EXPRESSLY GRANTED HEREUNDER),
NOTWITHSTANDING THE INSTALLATION OF SUCH ENGINE ON ANY AIRFRAME SUBJECT TO
THE LIEN OF SUCH MORTGAGE, UNLESS AND UNTIL LESSEE SHALL BECOME THE OWNER OF
SUCH ENGINE AND LESSOR SHALL HAVE NO FURTHER INTEREST THEREIN, ALL PURSUANT
TO THE EXPRESS TERMS OF THIS LEASE; AND (B) THERE SHALL BE IN EFFECT A
WRITTEN AGREEMENT OF THE LESSOR OR SECURED PARTY OF SUCH AIRFRAME (WHICH MAY
BE THE LEASE OR CONDITIONAL SALE OR OTHER SECURITY AGREEMENT COVERING SUCH
AIRFRAME) SUBSTANTIALLY SIMILAR IN EFFECT TO THE AGREEMENT OF LESSOR IN
SECTION 6(b) BELOW WHEREBY SUCH LESSOR OR SECURED PARTY EFFECTIVELY AND
EXPRESSLY AGREES THAT NEITHER IT NOR ITS SUCCESSORS OR ASSIGNS WILL ACQUIRE
OR CLAIM ANY RIGHT, TITLE OR INTEREST IN ANY ENGINE BY REASON OF SUCH ENGINE
BEING INSTALLED ON SUCH AIRFRAME AT ANY TIME WHILE SUCH ENGINE IS SUBJECT TO
THIS LEASE, AND A COPY OF SUCH AGREEMENT SHALL BE PROVIDED TO LESSOR UPON
WRITTEN REQUEST; AND
(5) SUBLEASE THE AIRCRAFT, AIRFRAME OR ANY ENGINE TO A PERMITTED AIR
CARRIER; AND
(II.) WITH THE PRIOR WRITTEN CONSENT OF LESSOR, WHICH CONSENT
SHALL NOT BE UNREASONABLY WITHHELD, LESSEE MAY SUBLEASE THE AIRCRAFT,
AIRFRAME OR ANY ENGINE TO A CERTIFICATED AIR CARRIER, WHICH IS NOT A
PERMITTED AIR CARRIER.
(ii) CERTAIN LIMITATIONS ON TRANSFERS. WITH RESPECT TO ANY
TRANSFER PURSUANT TO THIS SECTION 6(a):
(1) THE RIGHTS OF ANY TRANSFEREE THAT RECEIVED POSSESSION BY
REASON OF A TRANSFER PERMITTED BY THIS SECTION 6(a) SHALL BE SUBJECT AND
SUBORDINATE TO ALL THE TERMS OF THIS LEASE;
(2) LESSEE SHALL REMAIN PRIMARILY LIABLE HEREUNDER FOR THE
PERFORMANCE OF ALL OF THE TERMS OF THIS LEASE TO THE SAME EXTENT AS IF SUCH
TRANSFER HAD NOT OCCURRED; AND
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PHC 90-047 WKH
(3) NO INTERCHANGE AGREEMENT OR OTHER RELINQUISHMENT OF POSSESSION
PURSUANT TO THE TERMS OF THIS SECTION 6(a) SHALL IN ANY WAY DISCHARGE OR
DIMINISH ANY OF LESSEE'S OBLIGATIONS TO LESSOR HEREUNDER.
(iii) CERTAIN LIMITATIONS ON SUBLEASES. WITH RESPECT TO ANY
SUBLEASE PURSUANT TO SECTION 6(a) HEREOF:
(1) THE TERM OF SUCH SUBLEASE (INCLUDING, WITHOUT LIMITATION, ANY
OPTION OF SUBLESSEES, TO RENEW OR EXTEND THE SUBLEASE) IN ANY EVENT SHALL NOT
CONTINUE BEYOND THE END OF THE TERM;
(2) THE RIGHTS OF SUBLESSEE SHALL BE EXPRESSLY SUBJECT AND SUBORDINATE
TO ALL THE TERMS OF THIS LEASE; PROVIDED, HOWEVER, THAT SUCH SUBLEASE MAY
PROVIDE THAT SO LONG AS AN EVENT OF DEFAULT SHALL NOT HAVE OCCURRED AND BE
CONTINUING UNDER SUCH SUBLEASE, SUCH SUBLESSEE SHALL QUIETLY ENJOY THE
AIRCRAFT AND ALL RENTS, REVENUES, PROFITS AND INCOME THERETO, WITHOUT
INTERFERENCE BY LESSEE, AS SUBLESSOR, OR BY LESSOR OR BY ANY PERSON LAWFULLY
CLAIMING BY OR THROUGH LESSEE, AS SUBLESSOR, OR LESSOR;
(3) UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, LESSEE'S RIGHTS
UNDER ANY, SUCH SUBLEASE SHALL AUTOMATICALLY BE DEEMED ASSIGNED TO LESSOR;
(4) LESSEE SHALL REMAIN PRIMARILY LIABLE HEREUNDER FOR THE PERFORMANCE
OF ALL THE TERMS OF THIS LEASE TO THE SAME EXTENT AS IF ANY SUCH SUBLEASE HAD
NOT OCCURRED;
(5) ANY SUCH SUBLEASE SHALL EXPRESSLY PROVIDE THAT: THE AIRCRAFT,
AIRFRAME OR ENGINE MAY NOT BE OPERATED OR USED EXCEPT IN THE CIRCUMSTANCES
PROVIDED IN SECTION 6(c), (d), (e) AND (f) HEREOF (BUT SUBSTITUTING THE WORD
"PERMITTED AIR CARRIER" FOR THE WORD "LESSEE" AND THE WORD "LESSEE" FOR THE
WORD "LESSOR");
(6) NO SUCH SUBLEASE OF THE AIRCRAFT, AIRFRAME OR ANY ENGINE
SHALL IN ANY WAY (A) DESTROY OR DIMINISH ANY OF LESSOR'S RIGHTS HEREUNDER AND
SUCH RIGHTS SHALL CONTINUE AS I IF SUCH SUBLEASE OR TRANSFER HAD NOT OCCURRED
OR (B) DISCHARGE OR DIMINISH ANY OF LESSEE'S OBLIGATIONS TO LESSOR HEREUNDER;
(7) PRIOR TO A SUBLEASE TO A PERMITTED AIR CARRIER PURSUANT TO
SECTION 6(a)(i)(I)(5) BECOMING EFFECTIVE, LESSEE SHALL GIVE LESSOR WRITTEN
NOTICE OF ITS INTENT TO SUBLET THE AIRCRAFT, AIRFRAME OR ANY ENGINE (WHICH
NOTICE SHALL INCLUDE THE IDENTITY OF THE PROPOSED SUBLESSEE AND, IF THEN
DETERMINED, THE TERM OF THE PROPOSED SUBLEASE) AND WITHIN TEN (10) BUSINESS
DAYS FOLLOWING THE EFFECTIVE DATE OF SUCH SUBLEASE LESSEE SHALL FURNISH A
COPY OF SUCH SUBLEASE TO LESSOR;
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PHC 90-047 WKH
(8) (A) AT LEAST TEN (10) BUSINESS DAYS PRIOR TO THE PROPOSED
EFFECTIVE DATE FOR A SUBLEASE TO A CERTIFICATED AIR CARRIER PURSUANT TO
SECTION 6 (a) (i) (II), LESSEE SHALL GIVE (x) WRITTEN NOTICE OF ITS INTENT
TO SUBLET THE AIRCRAFT, AIRFRAME OR ANY ENGINE (WHICH NOTICE SHALL INCLUDE
THE IDENTITY OF THE PROPOSED SUBLESSEE AND, IF THEN DETERMINED, THE TERM OF
THE PROPOSED SUBLEASE) AND (y) SUCH INFORMATION AS MAY BE REASONABLY
REQUESTED BY LESSEE AND AVAILABLE TO LESSEE FOR USE BY LESSOR IN DETERMINING
WHETHER TO GRANT ITS CONSENT TO SUCH PROPOSED SUBLEASE AND (B) WITHIN TEN
(10) BUSINESS DAYS FOLLOWING THE EFFECTIVE DATE OF SUCH SUBLEASE LESSEE SHALL
FURNISH A COPY OF SUCH SUBLEASE TO LESSOR AND (c) LESSOR SHALL NOTIFY LESSEE
IN WRITING OF ITS CONSENT OR DENIAL OF CONSENT WITHIN SEVEN (7) BUSINESS DAYS
OF RECEIPT OF LESSEE'S WRITTEN NOTICE PROVIDED UNDER THIS SECTION 6A(iii)(8);
(9) ANY SUCH SUBLEASE SHALL EXPRESSLY PROVIDE THAT SUCH SUBLESSEE
WILL NOT TRANSFER POSSESSION OR CONTROL OF THE AIRCRAFT, AIRFRAME OR ENGINE
TO ANYONE OTHER THAN LESSEE OR, FOLLOWING AN EVENT OF DEFAULT, LESSOR, EXCEPT
THAT SUCH SUBLEASE MAY PERMIT TRANSFERS IN THE MANNERS DESCRIBED IN SECTION
6(a)(i) AS IF THE WORD "LESSEE" WAS CHANGED TO "SUBLESSEE", SUBJECT IN THE
CASE OF ANY SUBLEASE TO THE RESTRICTIONS SET FORTH IN THIS SECTION 6(a)
(iii); AND
(10) ANY SUCH SUBLEASE SHALL INCLUDE APPROPRIATE PROVISIONS (WHETHER
BY REQUIRING SUCH OBLIGATIONS TO BE PERFORMED BY THE SUBLESSEE, LESSEE OR
BOTH) FOR THE OPERATION, MAINTENANCE AND INSURANCE OF THE AIRCRAFT, AIRFRAME
OR ENGINE AND THE ENGINES SUBLEASED THEREBY WHICH ARE COMPARABLE TO, OR MORE
RESTRICTIVE THAN, THE PROVISIONS OF THE LEASE.
(b) RECIPROCAL RECOGNITION OF RIGHTS. In the event Lessee shall have
received from the lessor or secured party of any airframe leased to Lessee or
owned by Lessee subject to a conditional sale or other security agreement a
written agreement complying with clause (B) of Section 6 (a) (i) (1) (4)
hereof (which agreement may be contained in the lease, conditional sale
agreement or security agreement relating to such airframe), and the lease or
conditional sale or other security agreement covering such airframe also
covers an engine or engines owned by the lessor under such lease or subject
to a security interest in favor of the secured party under such conditional
sale or other security agreement, Lessor hereby agrees for the benefit of
such lessor or secured party that Lessor will not acquire or claim, as
against such lessor or secured party, any right, title or interest in any
such engine as the result of such engine being installed on the Airframe at
any time while such engine is subject to such lease or conditional sale or
other security agreement and owned by such lessor or subject to a security
interest in favor of such secured party. Lessor also hereby agrees for the
benefit of the mortgagee under any mortgage
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PHC 90-047 WKH
complying with clause (A) of Section 6 (a) (i) (I) (4) hereof, relating to
installation of an Engine on an airframe leased to Lessee, that Lessor will
not acquire or claim, as against such mortgagee, any right, title or interest
in any engine subject to the lien of such mortgage as the result of such
engine being installed on the Airframe at any time while such engine is
subject to the lien of such mortgage.
(c) LAWFUL INSURED OPERATIONS. Lessee will not permit the Aircraft to
be maintained, used or operated in violation of any Law of any Governmental
Entity, or in violation of any airworthiness certificate, or license or
registration issued by any such authority, or contrary to the Manufacturer's
or Engine Manufacturer's operating manuals or instructions for the Aircraft
or the Engines. In the event that any such Law requires alteration of the
Aircraft, Lessee shall comply therewith at its sole expense and shall
maintain the same in proper condition for operation under such Laws. Lessee
agrees not to operate the Aircraft, or permit the Aircraft to be operated,
(i) unless the Aircraft is covered by insurance as required by the provisions
hereof, or (ii) contrary to the terms of such insurance. Lessee also agrees
not to operate or locate the Aircraft or suffer or permit the Aircraft to be
operated or located in any area excluded from coverage by any insurance
policy issued pursuant to the requirements of this Lease.
(d) MAINTENANCE. Lessee, at its own cost and expense, shall: (i)
perform all mandatory service , inspections, repair, maintenance, overhaul
and testing, (A) as may, be required under applicable FAA rules and
regulations and in compliance with the Maintenance Program, (B) in the same
manner and with the same care as shall be the case with similar aircraft and
engines owned by or operated on behalf of Lessee without discrimination and
(C) so as to keep the Aircraft in as good operating condition as when
delivered to Lessee, ordinary wear and tear excepted; (ii) keep the Aircraft
in such condition as is necessary to enable the airworthiness certification
of the Aircraft to be maintained in good standing at all times under the FAA
regulations and any other applicable Law; and (iii) maintain all records,
logs and other materials required by, and in a manner acceptable to, the FAA
or any other Governmental Entity.
(e) REGISTRATION. On the Delivery Date Lessee, at its expense, shall
register the Aircraft in the United States in the name of Lessor or such
other Person as Lessor may reasonably designate. Lessee shall at its expense
keep the Aircraft at all times registered under the applicable Laws of the
United States in the name of Lessor or such Person as Lessor may reasonably
designate.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
(▇) INSIGNIA. Upon delivery of the Aircraft, or within forty-eight (48)
hours thereafter, Lessee agrees to place the Lease Identification in the
cockpit in a prominent location and to place the Lease Identification on each
Engine. Lessee agrees to make such changes to the Lease Identification as
Lessor may request from time to time.
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PHC 90-047 WKH
Section 7. INFORMATION.
During the term of this Lease, Lessee agrees to furnish Lessor the
following:
(i) within sixty (60) days following the end of each quarter of
Lessee's fiscal year, except the last such quarter of such year, (A) an
unaudited consolidated balance sheet of AQ Corp., which includes the
Guarantor and Lessee, prepared as of the close of each quarterly period,
together with the related unaudited profit and loss statement for such period
or (B) if such unaudited financial information is not prepared by AQ Corp.,
Lessee or Guarantor, such financial information as is provided on a quarterly
basis to the Board of Directors, any other creditor or lessor of AQ Corp.,
Lessee or Guarantor, accompanied by a certificate signed by a duly authorized
executive officer of Lessee to the effect that such financial information
fairly presents the financial conditions and operations of AQ Corp.
(ii) within one hundred twenty (120) days after the close of each fiscal
year of Lessee and Guarantor, (A) an audited balance sheet, profit and loss
statement, and statement of stockholders' equity of AQ Corp., which includes
Guarantor and Lessee (prepared on a consolidated basis), as of the close of
such fiscal year or (B) if such audited financial information is not
prepared by AQ Corp., Lessee or Guarantor, such financial information as is
provided on an annual basis to the Board of Directors, or to any other
creditor or lessor of AQ Corp., Lessee or Guarantor, accompanied by a
certificate signed by a duly authorized executive officer of Lessee to the
effect that such financial information fairly presents the financial
condition and operations of AQ Corp.
(iii) within one hundred twenty (120) days after the close of each
fiscal year of Lessee, a certificate signed by a duly authorized executive
officer of Lessee, stating (a) that such officer is familiar with the
relevant terms of this Lease and has made a review of Lessee's compliance
herewith during the preceding fiscal year, and (b) that no event has occurred
which constitutes a Default, or, if such an event has occurred, the nature
thereof and action Lessee has taken or is taking to cure the same; and
(iv) from time to time such other information as Lessor may reasonably
request, including information concerning the location, condition, use and
operation of the Aircraft.
Lessee shall permit Lessor or its designee on three (3) days' prior
written notice to visit and inspect the Aircraft, its condition, use and
operation and the records maintained in connection therewith; provided,
however, that Lessor shall not interfere with the normal operations of
Lessee. Lessor shall have
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PHC 90-047 WKH
no duty to make any such inspection and shall not incur any liability or
obligation by reason of not making any such inspection. Lessor's failure to
object to any condition or procedure observed or observable in the course of
an inspection hereunder shall not be deemed to waive or modify any of the
terms of this Lease with respect to such condition or procedure.
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PHC 90-047 WKH
Section 8. COVENANTS OF LESSEE.
Lessee covenants and agrees that:
(a) MAINTENANCE OF CORPORATE EXISTENCE. Except as provided in Section
8(d) below, during the term of this Lease, Lessee will preserve and maintain
its corporate existence and such of its rights, privileges, licenses and
franchises in any jurisdiction where failure to obtain such licensing or
qualification would have a material adverse effect upon Lessee.
(b) MAINTENANCE OF STATUS. Lessee is, and shall remain so long as it
shall be Lessee under this Lease, duly qualified to operate the Aircraft
under applicable Law.
(c) PAYMENT OF TAXES. Lessee will pay or cause to be paid all taxes,
assessments and governmental charges or levies imposed upon it, or upon its
income or profits, or upon any property belonging to it, prior to the date on
which penalties attach thereto and prior to the date on which any lawful
claim, if not paid, would become a Lien upon any of the material property of
Lessee.
(d) CONSOLIDATION, MERGER, ETC. Without the prior written consent of
Lessor, which consent shall not be unreasonably withheld, Lessee shall not
consolidate with, merge with or merge into any other corporation or convey,
transfer or lease substantially all of its assets as an entirety to any other
Person.
(e) PLACE OF BUSINESS. Lessee will not, without prior written notice to
Lessor, change its principal place of business or chief executive office if
there is more than one place of business.
(f) NOTICE OF DEFAULT. Within thirty (30) days after a responsible
officer of Lessee obtains knowledge of a Default hereunder, Lessee shall
notify Lessor in writing of such Default.
(g) GOVERNMENTAL CONSENTS. Lessee undertakes to maintain in full force
and effect all governmental consents, licenses, authorizations, approvals,
declarations, filings and registrations obtained or effected in connection
with this Lease and every document or instrument contemplated hereby and to
take all such additional action as may be proper or advisable in connection
herewith or therewith. Lessee further undertakes to obtain or effect any new
or additional governmental consents, licenses, authorizations, approvals,
declarations, filings or registrations as may become necessary for the
performance of any of the terms and conditions of this Lease or any other
document or instrument contemplated hereby.
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(h) SUSPENSION, CESSATION, ETC. Lessee shall not (i) voluntarily
suspend its certificated operations; or (ii) voluntarily or involuntarily
permit to be revoked, cancelled or otherwise terminated all or substantially
all of the franchises, concessions, permits, rights or privileges required for
the conduct of business and operations of Lessee or the free and continued use
and exercise thereof.
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PHC 90-047 WKH
Section 9. REPLACEMENT OF PARTS; ALTERATIONS, MODIFICATIONS AND
ADDITIONS.
(a) REPLACEMENT OF PARTS. Lessee, at its own cost and expense, will
promptly replace all Parts which may from time to time become unserviceable,
lost, stolen, destroyed, seized, confiscated, damaged beyond repair or
permanently rendered unfit for use for any reason whatsoever. In addition, in
the ordinary course of maintenance, service, repair, overhaul or testing,
Lessee may at its own cost and expense cause to be removed any Parts, whether
or not unserviceable, destroyed, damaged beyond repair or permanently
rendered unfit for use, provided that Lessee shall replace at its own cost
and expense such Parts as promptly as practicable. All replacement Parts
shall be free and clear of all Liens, other than Liens permitted by Section
14 hereof, shall be in at least the same modification status and service
bulletin accomplishment status, shall be fully interchangeable as to form,
fit and function, shall have been inspected by an agency acceptable to the
FAA and, if necessary, overhauled or repaired by such agency, and shall be in
as good an operating condition as, and have a utility at least equal to and a
value and remaining warranty reasonably approximating, the Parts replaced
(assuming such replaced parts were in the condition and repair in which they
were required to be maintained by the terms hereof) and all historical
records relating to such Parts shall be maintained by Lessee.
All Parts owned by Lessor which are at any time removed from the
Aircraft shall remain the property of Lessor and subject to this Lease, no
matter where located, until such time as such Parts shall be replaced by
Parts which have been incorporated or installed in or attached to the
Aircraft and which meet the requirements for replacement Parts specified
above. Immediately upon any replacement Part becoming incorporated or
installed in or attached to the Aircraft as above provided, (i) title to the
removed part shall thereupon vest in Lessee, free and clear of all rights of
Lessor, (ii) title to such replacement part shall thereupon vest solely in
Lessor, and (iii) such replacement part shall become subject to this Lease
and be deemed a Part for all purposes hereof to the same extent as the Part
which it has replaced.
(b) ALTERATIONS, MODIFICATIONS AND ADDITIONS. Lessee, at its own
expense, shall make such alterations and modifications and additions to the
Aircraft as may be required from time to time to meet the applicable
standards of the FAA or to comply with any law, rule, directive, bulletin,
regulation or order of any Governmental Entity or of the manufacturer of the
Aircraft, Engines or Parts. In addition, Lessee, at its own expense, may from
time to time make alterations and modifications in and additions to the
Aircraft, provided no such alteration, modification or addition diminishes
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the remaining warranty, value or utility, or impairs the condition or
airworthiness, of the Aircraft. Title to all Parts incorporated or installed
in or attached or added to the Aircraft as the result of such alteration,
modification or addition shall vest immediately in Lessor and become subject
to this Lease, without the necessity for any further act of transfer,
document or notice. Notwithstanding the foregoing sentence of this Section 9
(b), Lessor agrees that so long as no Event of Default shall have occurred
and be continuing, Lessee may, at such time during the Term, remove any Part
of the Aircraft without replacement, provided that (i) such Part is in
addition to, and not in replacement or substitution for, any Part originally
incorporated or installed in or attached to the Aircraft at the time of
delivery thereof hereunder or any Part in replacement of, or substitution
for, any such originally incorporated or installed or attached Part, (ii)
such Part is not required to be incorporated or installed in or attached or
added to the Aircraft pursuant to the terms of this Section 9 and (iii) such
Part can be removed from the Aircraft without diminishing or impairing the
value, utility, condition or airworthiness which the Aircraft would have had
at such time had such alteration, modification or addition not occurred. Upon
the removal by Lessee of any such Part as provided in the preceding sentence,
title thereto shall, without further act, vest in Lessee and such Part shall
no longer be deemed part of the Aircraft (such a part is herein called a
"Removable Part"). Lessee, at its sole expense, shall repair any damage to
the Aircraft resulting from any such removal. Any Part not removed by Lessee
as above provided prior to the return of the Aircraft to Lessor hereunder
whether pursuant to Section 16, Section 18 or otherwise shall remain the
property of Lessor. If any Removable Part is (i) owned by any third party and
leased to Lessee, (ii) sold to Lessee subject to a conditional sales contract
or other security interest, or (iii) leased to Lessee pursuant to a lease
which is subject to a security interest in favor of any third party, then
Lessor will not acquire or claim, as against such lessor, conditional vendor,
or secured party, any right, title or interest in any such Removable Part as
the result of such Removable Part being installed in the Aircraft; provided,
however, (a) that Lessor's inability to so acquire or claim is subject to the
express condition that such lessor, conditional vendor, or secured party
shall not acquire or claim, as against Lessor, any right, title or interest
in the Aircraft, or any Part other than its interest in such Removable Part
by reason of such Removable Part being installed thereon, and (b) that any
Removable Part not removed by Lessee within sixty (60) days after an Event of
Default, shall, at such time, become the property of Lessor and be subject to
this Lease. In no event shall Lessor bear any liability or cost for any
alteration, modification or addition to, or for any grounding or suspension
of certification of, the Aircraft, or for any loss of revenue arising
therefrom. Lessee shall make no material alterations, modifications or
additions to
9-2
PHC 90-047 WKH
the Aircraft (such as removal of first class seats, galleys, lavatories, major
avionics equipment or the like) that would affect the marketability of the
Aircraft without Lessor's prior written consent; provided, however, that Lessee
may make such material alterations, modifications or additions, without first
obtaining Lessor's consent, if at least ten (10) Business Days prior to
commencing such alteration, modification or addition Lessee delivers to Lessor
a written undertaking duly executed by Lessee whereby (i) Lessee describes in
reasonable detail such proposed alteration, modification or addition; and (ii)
if requested by Lessor, Lessee undertakes on or before the Return Occasion to
reinstall any Parts removed from the Aircraft and to restore the Aircraft to
the condition it was in immediately prior to commencing such work. Title to any
Parts so removed shall remain with Lessor and Lessor may request Lessee to
reinstall such Parts prior to termination of this Lease. If Lessor. does not
request Lessee to reinstall such Parts, title to the parts removed shall vest
in Lessee. All costs associated with such removal and reinstallation shall be
borne by Lessee.
9-3
PHC 90-047 WKH
Section 10. GENERAL TAX INDEMNITY.
Lessee agrees that each payment of Rent pursuant to the Lease shall
be free of all withholdings of any nature whatsoever (including, without
limitation, withholding taxes, monetary transfer fees, or similar taxes and
charges) and in the event any withholding is required, the Lessee shall pay
the same together with such additional amount as is required so that each
payment of Rent hereunder shall be, under any circumstances and in any event,
in the amount as set forth or referred to herein. Lessee agrees, on written
demand, to pay, and to indemnify and hold each Indemnitee (which term as
used in this Section 10 shall include each Indemnitee, their respective
affiliates, agents, employees, successors and permitted assigns, partners or
unit holders thereof and any combination thereof) harmless from, all license
and registration fees, and, without limitation, all Taxes, howsoever levied
or imposed, whether levied or imposed upon or asserted against any
Indemnitee, the Lessee, the Aircraft or any Part thereof or interest thereon,
or otherwise by any Federal, state or local government or taxing authority in
the United States of America or by any foreign government or any taxing
authority or governmental subdivision of a foreign country or of a territory
or possession of the United States or any international taxing authority,
upon or with respect to, based upon or measured by (i) the Aircraft or any
Part thereof, or interest therein, (ii) the manufacture, ownership, delivery,
acceptance, substitution, recording, importation, exportation, leasing,
assigning, possession, use, operation, settlement of any insurance claim,
sale, mortgaging, pledging, financing, subleasing, rental, retirement,
abandonment, registration, preparation, installation, modification, repair,
maintenance, replacement, transportation, storage, transfer of title, return
or other disposition of the Aircraft or any Part thereof or interest therein;
(iii) the rentals, receipts or earnings arising therefrom (including without
limitation the Rent), (iv) or upon or with respect to the Operative
Documents, or (v) otherwise with respect to or in the connection with the
transactions contemplated by the Operative Documents. Notwithstanding the
foregoing, there shall be excluded from the Lessee's obligation with respect
to withholdings, as described in the first sentence of this Section 10, and
from the foregoing categories (i) through (v), the following:
(A) any Taxes imposed by the Federal government of the United States
of America or any taxing authority or governmental subdivision thereof upon
or with respect to, based on or measured by, the net income of any Indemnitee
or Taxes in lieu thereof,
(B) value added taxes or franchise taxes, taxes on doing business,
capital stock taxes, taxes, fees or other charges on, based on, or measured
by, the gross or net income or receipts
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(▇▇▇▇▇▇▇▇▇ minimum taxes, withholding taxes and taxes on or measured by any
items of tax preference but excluding sales or use taxes) or taxes in lieu
thereof of any Indemnitee imposed by any international taxing authority, or
by any United States state, local or territorial or possessions or other
taxing authority or governmental subdivision thereof or any foreign country,
provincial, state or local government or taxing authority in any
jurisdiction; provided, however, that there shall not be excluded any such
taxes imposed by any such taxing jurisdiction solely as a result of the
location or operation of the Aircraft or any part thereof in such
jurisdiction (a jurisdiction in which tax is imposed solely as the result of
the location or operation of the Aircraft or any part thereof in such
jurisdiction is a "Use Jurisdiction") but only to the extent that the
aggregate amount of such taxes in all Use Jurisdictions exceeds the sum of
(x) the tax benefits of the aggregate amount of all credits and losses that
are attributable to the transactions contemplated by the operative Documents
that have actually been utilized by the Indemnitee to reduce its tax
liability in any Use Jurisdiction in any year including for purposes of
calculating such losses, but not limited to, depreciation deductions,
interest expenses and amortization of transaction expenses relating to the
ownership or leasing of the Aircraft ("Reductions") plus (y) an amount equal
to interest on each such Reduction at the rate of four percent (4%) per
annum from the date such Reduction is actually utilized by such Indemnitee to
the date the amount of such Reduction is used to offset the amount of taxes
that would otherwise be indemnified against hereunder in all Use
Jurisdictions; provided further, however, that (I) any taxes imposed by or
Reductions realized in the jurisdiction in which such Indemnitee (considered
for this purpose on a separate company basis) maintains its principal place
of business shall be excluded; (II) in the case of a successor or assign of
an Indemnitee that seeks indemnification in accordance with the provisions of
this subclause (B), the Reductions taken into account shall include
Reductions actually realized by the predecessor or assignor of such person as
well as by such person; (III) there shall be excluded from the calculation of
taxes any taxes imposed as a result of the voluntary disposition of the
Aircraft or any interest therein by the Indemnitee; (IV) for purposes of
determining whether a tax is attributable to the transactions contemplated by
the Operative Documents income items recognized by the Indemnitee in such Use
Jurisdiction shall be treated as contributing on a pro rata basis to the
income subjected to tax in such Use Jurisdiction and for purposes of
determining whether losses, deductions or credits actually utilized to reduce
the tax liability of such Indemnitee are attributable to the transactions
contemplated by the operative Documents such items of loss, deduction or
credit shall be treated as recognized in the order realized by such
Indemnitee with items realized in the same taxable year treated as utilized
on a pro rata basis; (V) in the event of
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a Reduction subsequent to the payment of any indemnity determined in
accordance with the provisions of this subclause (B) the Indemnitee shall pay
to the Lessee within 30 days after the filing of the Indemnitee's tax return
on which such Reduction is recognized an amount equal to the excess of any
such indemnity over the indemnity that would have been payable if such
Reduction had been realized immediately prior to the payment of such
indemnity, but in no event shall the Indemnitee be required to pay to the
Lessee any amount in excess of such indemnity previously paid to the
Indemnitee by the Lessee; (VI) the amount of any indemnity determined in
accordance with the provisions of this subclause (B) shall be set forth in
the Indemnitee's notice to the Lessee that such amount is payable and such
notice shall be signed by an officer of the Indemnitee and state in
reasonable detail the basis upon which such amount has been determined and
the amount of the Reductions previously realized, and at the Lessee's request
and expense, be verified by a firm of independent certified public
accountants of recognized national standing (provided that if such
accountants determine that the amount of the indemnity payment claimed by the
Indemnitee exceeds the amount that is properly claimed by such Indemnitee
pursuant to this Section 10 by five percent (5%) or more of the amount
properly claimed then such verification shall be at the expense of the
Indemnitee);
(C) any Taxes imposed as a result of a sale, transfer of title,
mortgaging, pledging, financing, voluntary transfer or other voluntary
disposition by an Indemnitee of the Aircraft or part thereof or interest
therein, or any interest in the Rent or part thereof or any interest in the
Operative Documents or part thereof, unless such sale, transfer, mortgage,
pledge or disposition occurs by reason of the exercise of an Indemnitee's
remedies under this Lease upon a Default or an Event of Default or by
reason of the early termination of the Lease by Lessee, provided, however,
that Lessor shall consider in good faith such request as Lessee shall make
concerning the appropriate jurisdiction in which such sale, transfer or
disposition shall be made;
(D) any Taxes caused solely by the negligence or misconduct of any
Indemnitee; and
(E) Any Taxes caused solely by a failure by an Indemnitee to furnish
in a timely manner notice or information which such Indemnitee is required to
furnish to Lessee.
Any payment to any of the Indemnitees shall be made by Lessee net of
any savings by such Indemnitee by reason of deductions, credits, allocations
or allowances in respect of the payment or accrual of the Taxes indemnified
against and Indemnitee shall furnish Lessee whatever information Lessee
reasonably believes is necessary to compute the offsetting benefit.
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▇▇ case any report or return is required to be made with respect to
any Taxes which are an obligation of Lessee under this Section 10, Lessee
will either make such report or return in such manner as will show the
ownership of the Aircraft in the Lessor and send a copy of such report or
return to the Lessor or will notify Lessor of such requirement and make such
report or return in such manner as shall be reasonably satisfactory to the
Lessor. If actual notice is given by any taxing authority to an Indemnitee
that a report or return is required to be filed with respect to any such
Taxes referred to in this Section 10, the Indemnitee shall promptly notify
Lessee of such required report or return. Each Indemnitee agrees to respond
to any reasonable request of Lessee for information within the control of
such Indemnitee with respect to the filing of any such report or return, but
Lessee agrees to pay any reasonable costs, fees or other charges of
independent counsel or independent accountants incurred in connection with
such request. Promptly upon written request by an Indemnitee, the Lessee will
provide such Indemnitee with all information with respect to the Aircraft
reasonably requested by the Indemnitee to enable the Indemnitee to prepare
any required tax report, return or other filing in any jurisdiction (whether
or not such report, return or filing relates to Taxes indemnifiable hereunder
and whether or not the Indemnitee is subject to tax in such jurisdiction
without regard to the transaction contemplated by the Operative Documents).
In addition, as soon as practicable after the beginning of each calendar year
(but in no event later than February 28 of such year), the Lessee shall
provide the Lessor with a summary of the location of the Aircraft during the
preceding calendar year.
All of the obligations of Lessee under this Section 10 with respect
to the Aircraft or any Part thereof shall survive the assignment, expiration
or other termination of the Lease with respect to the Aircraft. Such
obligations are expressly undertaken by Lessee for the benefit of, and shall
be enforceable by, Lessor and each Indemnitee. The Lessee further agrees
that, with respect to any payment or indemnity hereunder, such payment or
indemnity shall include any amount necessary to hold the recipient of the
payment or indemnity harmless on an after-tax basis from all Taxes required
to be paid by such recipient with respect to such payment or indemnity under
the laws of any Federal, state or local government or taxing authority in the
United States of America, or under the laws of any foreign government or any
taxing authority or governmental subdivision of a foreign country or
possession or territory of the United States or any international taxing
authority, after giving credit to Lessee for any savings by such recipient in
respect to any such Taxes by reason of deductions, credits, allocations, or
allowances in respect of the payment or accrual of the amount indemnified
against.
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If claim is made against any Indemnitee for any such Taxes, such
Indemnitee shall promptly notify the Lessee; provided, however, the failure
to provide such notice shall not affect the Lessee's obligations hereunder to
any Indemnitee except to the extent such failure to provide prompt notice (A)
adversely and materially affect Lessee's ability to contest such claim in
accordance with this Section 10 or (B) results in additional penalties,
interest or additions to tax. Any amount payable as an indemnity to any
Indemnitee or any amount payable to Lessee pursuant to this Section 10 is to
be paid to such party directly, in immediately available funds, within thirty
(30) days after receipt of a written demand therefor from such Indemnitee or
Lessee, as the case may be, except (i) in the event that the Indemnitee
receives notice that Taxes related to such amount demanded from Lessee are
due and payable within a period of 30 days or less following receipt of such
claim by such Indemnitee and such Indemnitee promptly makes a written demand
on Lessee, then such amount demanded shall be payable in no event after the
later of (t) five business days after receipt of such demand by Lessee or (u)
three business days prior to the due date of the related Taxes, and (ii) in
case of payment to an Indemnitee to the extent that such Taxes are being
contested in good faith pursuant to this Section 10, in which event the
payment of such indemnity shall be made by the due date for the payment of
any Taxes that are the subject of such contest taking into account all
extensions of the due date that are available as a result of the contest. In
the event an Indemnitee makes a tax payment with respect to any such Taxes
(other than with funds advanced to such Indemnitee on an interest-free basis
by the Lessee pursuant to this Section 10) the Lessee shall pay to the
Indemnitee interest on the amount of such payment at the Interest Rate set
forth in Exhibit C from the date of such payment to the date of such payment
by the Lessee to the Indemnitee hereunder. In the event an amount is payable
to Lessee under this Section 10, the Indemnitee owing such amount shall pay
interest on such amount at the Interest Rate set forth in Exhibit C from the
date that is ten (10) days following the event giving rise to such obligation
to pay Lessee until the date of payment to Lessee.
If reasonably requested by the Lessee in writing and provided no
material Event of Default shall have occurred and is continuing, an
Indemnitee shall upon receipt of indemnity reasonably satisfactory to it and
at the sole expense of the Lessee (including, without limitation, all
out-of-pocket costs, expenses, additions to tax because of underpayments of
estimated Taxes, losses, legal and accounting and investigatory fees and
disbursements, penalties, and interest) in good faith contest or shall permit
the Lessee, if desired by the Lessee, to contest in the name of the Lessee
and/or the Indemnitee the validity, applicability or amount of such Taxes
(provided that Lessee shall
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not be permitted to contest in the name of such Indemnitee if such contest
involves Taxes imposed against Indemnitee that are unrelated to the
transactions contemplated by the operative Documents, in which event such
Indemnitee shall follow the direction of Lessee with respect to the method of
pursuing that portion of such contest that relates to the transactions hereby
contemplated unless, with respect to issues that do not relate to the
settlement of any portion of the contest involving Taxes for which
Indemnification is provided by this Section 10, such direction would
adversely affect interests hereby contemplated). Lessee may contest by (a)
resisting payment thereof if practicable, (b) not paying the same except
under protest with funds advanced by Lessee on an interest-free basis, if
protest is necessary and proper, and (c) if payments be made, using
reasonable efforts to obtain a refund thereof in appropriate administrative
and judicial proceedings; provided, however, that, in each such instance, the
Indemnitee shall not be required to undertake any contest unless (w) Lessee
shall have provided Lessor with an opinion of legal counsel to the effect
that a meritorious defense exists to such claim (which opinion shall be
obtained at Lessee's sole cost and expense), (x) if such contest is to be
initiated by the payment of, and the claiming of a refund for, such Taxes,
the Lessee shall have advanced to such Indemnitee sufficient funds (on an
interest-free basis) to make such payments, (y) such proceedings do not
involve any material risk or danger of the sale, forfeiture or loss of the
Aircraft or any part thereof or interest therein or the imposition of
criminal penalties or sanctions against the Indemnitee and (z) in the event
that the subject matter of the contest is of a continuing nature and has
previously been decided adversely pursuant to the contest provisions of this
Section 10 by the highest court to which an appeal could be taken, there has
been a change in the law (including, without limitation, amendments to
statutes or regulations, administrative rulings and court decisions) after
such claim shall have been so previously decided and such Indemnitee shall
have received an opinion of independent tax counsel selected by such,
Indemnitee and reasonably acceptable to the Lessee, which opinion shall be
obtained at the Lessee's sole expense, to the effect that, as a result of
such change, it is more likely than not that the position which such
Indemnitee or the Lessee, as the case may be, had asserted in such previous
contest would prevail. If any Indemnitee shall obtain a refund of all or any
part of such tax, fee or other charge paid by Lessee, such Indemnitee shall
pay the Lessee, the amount of such refund less the amount of any Taxes
payable by such Indemnitee Taxes, losses, legal and accounting and
investigatory fees and disbursements, penalties, and interest) in good faith
contest or shall permit the Lessee, if desired by the Lessee, to contest in
the name of the Lessee and/or the Indemnitee the validity, applicability or
amount of such Taxes (provided that Lessee shall not be permitted to contest
in the name of such Indemnitee if such contest involves
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▇▇▇▇▇ imposed against Indemnitee that are unrelated to the transactions
contemplated by the Operative Documents, in which event such Indemnitee shall
follow the direction of Lessee with respect to the method of pursuing that
portion of such contest that relates to the transactions hereby contemplated
unless, with respect to issues that do not relate to the settlement of any
portion of the contest involving Taxes for which Indemnification is provided
by this Section 10, such direction would adversely affect interests hereby
contemplated). Lessee may contest by (a) resisting payment thereof if
practicable, (b) not paying the same except under protest with funds advanced
by Lessee on an interest-free basis, if protest is necessary and proper, and
(c) if payments be made, using reasonable efforts to obtain a refund thereof
in appropriate administrative and judicial proceedings; provided, however,
that, in each such instance, the Indemnitee shall not be required to
undertake any contest unless (w) Lessee shall have provided Lessor with an
opinion of legal counsel to the effect that a meritorious defense exists to
such claim (which opinion shall be obtained at Lessee's sole cost and
expense), (x) if such contest is to be initiated by the payment of, and the
claiming of a refund for, such Taxes, the Lessee shall have advanced to such
Indemnitee sufficient funds (on an interest-free basis) to make such
payments, (y) such proceedings do not involve any material risk or danger of
the sale, forfeiture or loss of the Aircraft or any part thereof or interest
therein or the imposition of criminal penalties or sanctions against the
Indemnitee and (z) in the event that the subject matter of the contest is of
a continuing nature and has previously been decided adversely pursuant to the
contest provisions of this Section 10 by the highest court to which an appeal
could be taken, there has been a change in the law (including, without
limitation, amendments to statutes or regulations, administrative rulings and
court decisions) after such claim shall have been so previously decided and
such Indemnitee shall have received an opinion of independent tax counsel
selected by such Indemnitee and reasonably acceptable to the Lessee, which
opinion shall be obtained at the Lessee's sole expense, to the effect that,
as a result of such change, it is more likely than not that the position
which such Indemnitee or the Lessee, as the case may be, had asserted in such
previous contest would prevail. If any Indemnitee shall obtain a refund of
all or any part of such tax, fee or other charge paid by Lessee, such
Indemnitee shall pay the Lessee, the amount of such refund less the amount of
any Taxes payable by such Indemnitee in respect of the receipt of such refund
after giving credit to Lessee for any savings by such Indemnitee in respect
to any such Taxes by reason of deductions, credits, allocations or
allowances in respect of the payment of any such Taxes; provided that such
amount shall not be payable before such time as the Lessee shall have made
all payments or indemnities then due to Lessor under the Lease provided
further, however, that any subsequent loss of any tax benefit it generating a
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refund paid to the Lessee hereunder shall be treated as a Tax subject to
Indemnification in accordance with this Section 10 (without regard to any
exclusions set forth in this Section 10). If in addition to such refund any
Indemnitee shall receive an amount representing interest on the amount of
such refund, the Lessee shall be paid that proportion of such interest which
is fairly attributable to Taxes paid by the Lessee prior to the receipt of
such refund; provided, however, that no amount shall be payable under this or
the preceding sentence during any period in which an Event of Default has
occurred and is continuing unremedied unless the Lease has terminated and
Lessee has paid all amounts due Lessor thereunder. Lessee shall not be deemed
to be in default under any of the above indemnification provisions of this
Section 10 so long as Lessee or the Indemnitee shall diligently prosecute
such contest. Notwithstanding the foregoing, if a claim is made against any
Indemnitee for any Taxes which, if successful, would result in the imposition
of Taxes under circumstances which would require the Lessee to indemnify such
Indemnitee, the Indemnitee shall be released from its responsibility to
contest such claim, or part thereof, if it agrees in writing not to seek
indemnification from Lessee in respect of the claim, or such part thereof to
be contested. In the event an Indemnitee fails to contest, or refuses to
permit the Lessee to contest, a claim or part thereof which the Indemnitee
has the obligation to contest or to permit Lessee to contest under this
Section 10, then Lessee shall not be obligated to indemnify the Indemnitee
for such claim or such part thereof.
For purposes of this Section 10, the general partner of an Indemnitee
that is a limited partner or unit holder of a partnership is hereby
designated by such Indemnitee and Lessee as the Tax Matters Partner ("TMP").
If Indemnitee is a limited partner or unit holder of a partnership that has
more than one general partner, then Indemnitee or such partnership shall
designate the general partner to serve as the TMP. If no such designation is
made then 10 days following the Lessee's request to the Indemnitee or the
partnership that such a designation be made the Lessee may designate the
general partner to serve as the TMP. With respect to an Indemnitee that is a
limited partner or unit holder of a partnership, the TMP is the sole party
to, from, or with whom Lessee shall be obligated to communicate or receive
any communication or notice, negotiate, settle or enter into stipulations,
agree upon or make factual determinations, make elections, or make payments
regarding any matter arising under this Section 10. With respect to an
Indemnitee that is a limited partner or unit holder of a partnership, notices
received or served by Lessee from or upon the TMP shall be deemed notice duly
served from or upon such Indemnitee. With respect to an Indemnitee that is a
limited partner or unit holder of a partnership, for the purposes of this
Section 10, the Lessee shall have no obligation
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to communicate or deal with any party other than the TMP. In the event that
the Indemnitee is a member of an Affiliated Group (within the meaning of
Section 1504(a) of the Code) which files a consolidated Federal income tax
return, the term "Indemnitee" shall mean and include such Affiliated Group.
The Lessee's obligations under this Section 10 shall not be affected
by any circumstances, including, without limitation, any setoff,
counterclaim, recoupment, defense or other right which Lessee may have
against the Lessor, any Indemnitee or any other person for any reason
whatsoever (except as provided in this Section 10).
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Section 11. CASUALTY OCCURRENCES.
(a) CASUALTY OCCURRENCE WITH RESPECT TO THE AIRFRAME. Within fifteen
days after a Casualty Occurrence with respect to the Airframe and any Engine
then installed thereon, Lessee shall give Lessor written notice of such
occurrence. On or before forty-five days after the date of the Casualty
Occurrence, Lessee shall pay to Lessor in immediately available funds the
sum of (A) the Casualty Value of the Aircraft computed as of the date of
payment, plus an amount equal to the daily equivalent of Basic Rent and
Additional Rent for each day during the period commencing with the Basic Rent
Payment Date immediately preceding payment of such Casualty Value and
extending to, but excluding the date of payment of such Casualty Value, and
(B) all Supplemental Rent, other than amounts paid pursuant to clause (A),
computed as of the date of payment. Upon such payment (i) the obligation
of Lessee to make further payments of Basic Rent and Additional Rent
hereunder shall terminate, (ii) this Lease shall terminate with respect to
the Aircraft, and (iii) Lessor will transfer to Lessee all of Lessor's right,
title and interest, if any, in and to the Airframe and Engines (if any)
suffering the Casualty Occurrence as well as all of Lessor's right, title
and interest in and to any Engine constituting part of the Aircraft but not
installed thereon at the time of the Casualty Occurrence. Such transfer shall
be without recourse or warranty, except that Lessor shall warrant it has good
title to the Airframe and Engines (if any), free and clear of Lessor's Liens.
(b) CASUALTY OCCURRENCE WITH RESPECT TO AN ENGINE. Upon a Casualty
Occurrence with respect to an Engine only, Lessee shall give Lessor prompt
written notice thereof and shall, within forty-five days after such
occurrence, convey to Lessor, as replacement for the Engine suffering a
Casualty Occurrence, title to a Replacement Engine. Each Replacement Engine
shall be free of all Liens (except those Liens which are permitted by Section
14 hereof) and shall be in as good an operating condition as the Engine being
replaced, assuming the Engine being replaced was in the condition and repair
required by the terms hereof immediately prior to the Casualty Occurrence.
Upon full compliance by Lessee with the terms of this paragraph, Lessor will
transfer to Lessee title to the Engine which suffered the Casualty
Occurrence. Prior to or at the time of any such conveyance, Lessee, at its
own expense, will promptly (i) furnish Lessor with a full warranty ▇▇▇▇ of
sale, in form and substance reasonably satisfactory to Lessor, with respect
to such Replacement Engine; (ii) cause a supplement hereto, in form and
substance reasonably satisfactory to Lessor, subjecting such Replacement
Engine to this Lease, to be duly executed by Lessee, and recorded pursuant to
applicable Law; (iii) furnish Lessor with such evidence of title to such
Replacement Engine and of compliance with the insurance provisions of Section
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12 hereof with respect to such Replacement Engine as Lessor may reasonably
request; (iv) furnish Lessor with an opinion of Lessee's counsel to the
effect that title to such Replacement Engine has been duly conveyed to
Lessor, free and clear of all Liens, and that such Replacement Engine is duly
leased hereunder; (v) furnish a certificate signed by a duly authorized
financial officer or executive of Lessee certifying that, upon consummation
of such replacement, no Default or Event of Default will exist hereunder;
(vi) furnish Lessor with such documents as Lessor may reasonably request in
connection with the consummation of the transactions contemplated by this
Section 11(b), in each case in form and substance satisfactory to Lessor;
and (vii) furnish such financing statement covering the Replacement Engine as
may be requested by Lessor. Upon full compliance by Lessee with the terms of
this Section 11(b), Lessor will transfer to Lessee all of the right, title
and interest in the Engine which suffered the Casualty occurrence and which
was originally leased to Lessee. Such transfer shall be without recourse or
warranty, except that Lessor shall warrant it has good title to the Engine,
free and clear of Lessor's Liens. For all purposes hereof, each such
Replacement Engine shall be deemed part of the property leased hereunder,
shall be deemed an "Engine" as defined herein and shall be deemed part of the
same Aircraft as was the Engine replaced thereof. No Casualty Occurrence
covered by this Section 11(b) shall result in any reduction in Rent.
(c) APPLICATION OF PROCEEDS AND PAYMENTS. Any payments received at
any time by Lessor or by Lessee from any insurer under insurance (other than
liability insurance), from any governmental authority or other person with
respect to a Casualty Occurrence will be applied as follows:
(i) unless clause (ii) below is applicable, so much of such
payments as shall not exceed the Casualty Value required to be paid by
Lessee pursuant to Section 11(a) of this Lease shall be paid to Lessor in
reduction of Lessee's obligation to pay such Casualty Value if not already
paid by Lessee, or, if already paid by Lessee (unless a Default or an Event
of Default shall have occurred and be continuing) shall be applied by Lessor
to reimburse Lessee for its payment of such Casualty Value and the balance of
such payment, if any, remaining thereafter (if such payment is received with
respect to insurance other than liability insurance) (unless a Default or an
Event of Default shall have occurred and be continuing) shall be paid over
to, or retained by, Lessee, except to the extent any such amount is
specifically allocable to an interest of Lessor; or
(ii) if such payments are received as a result of a Casualty
Occurrence with respect to an Engine which is being replaced pursuant to
Section 11(b), unless a Default or Event of
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▇▇▇▇▇▇▇ shall have occurred and be continuing, all such payments shall be
paid over to, or retained by, Lessee if Lessee shall have fully performed or,
concurrently therewith will fully perform, the terms of Section 11(b) and of
Section 15 hereof with respect to the Casualty Occurrence for which such
payments are made.
(d) REQUISITION FOR USE BY GOVERNMENT WITH RESPECT TO THE AIRCRAFT.
In the event of the requisition for use by a Governmental Entity of the
Airframe or any Engine (other than a requisition constituting a Casualty
Occurrence), all Lessee's obligations under this Lease with respect to the
Airframe or Engine shall continue to the same extent as if such requisition
had not occurred. All payments received by Lessor or Lessee from the
Governmental Entity for the use of the Airframe or Engine during the Term
therefor shall be paid over to, or retained by, Lessee if no Default or Event
of Default shall have occurred and be continuing; and all payments received
by Lessor or Lessee from the Government for the use of such item after the
Term therefor shall be paid over to, or retained by, Lessor.
(e) OTHER DISPOSITIONS. Any amounts not payable to or retainable by
Lessee pursuant to this Section 11 or Section 12 hereof because a Default or
an Event of Default shall have occurred and be continuing shall be held by
Lessor and shall be paid over to Lessee when such Default or Event of Default
shall cease to be continuing, except that if Lessor shall have theretofore
declared this Lease to be in default pursuant to Section 18 hereof, such
amounts shall be retained by Lessor and disposed of in accordance with the
provisions thereof.
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Section 12. INSURANCE.
(a) PUBLIC LIABILITY AND PROPERTY DAMAGE INSURANCE. Lessee will
carry and maintain in effect, at its own expense, with Approved Insurers,
comprehensive public liability insurance (including, without limitation,
contractual liability and passenger legal liability), and property damage
insurance with respect to the Aircraft of the type usual and customary by
commercial scheduled airline standards for airline carriers operating similar
aircraft and providing for no less coverage than is carried by Lessee on
similar aircraft in its fleet. Such insurance shall be in an amount not less
than the amount applicable to similar passenger aircraft and engines which
comprise Lessee's fleet, and in any event not less than the amount under
"Public Liability and Property Damage Insurance" as set forth on Exhibit C
hereto. Lessee shall not discriminate against the Aircraft in providing such
insurance.
(b) INSURANCE AGAINST LOSS OR DAMAGE. Lessee, at its own expense,
will maintain in effect with Approved Insurers "all-risk" ground and flight
aircraft hull insurance (which shall include, but not be limited to,
comprehensive war risk and allied perils, hijacking, a disappearance clause
and coverage against strikes, riots, commotions or labor disturbances,
malicious acts or acts of sabotage and unlawful seizure (including
confiscation, arrest, nationalization, seizure, restraint, detention,
appropriation, requisition or destruction thereat, by or under authority of
any Governmental Entity), or wrongful exercise of control of the Aircraft in
flight by a person on board the Aircraft acting without the consent of
Lessee) covering the Aircraft, and fire, transit and extended perils and
"all-risk" coverage insurance with respect to Engines and Parts while not
installed on the Aircraft or an aircraft, which in each case, considering all
policy terms, limitations and exclusions, is at least as broad as coverage
maintained by Certificated Air Carriers similarly situated to Lessee and
operating similar aircraft and engines which comprise Lessee's fleet. Such
insurance shall be for an amount not less than the Casualty Value for the
Aircraft. Such insurance may include provisions for deductibles in an amount
usual and customary by commercial scheduled airline standards for airline
carriers operating similar aircraft provided that (i) the amount of such
deductibles must be no greater than the lowest deductible amount applying to
any similar aircraft in Lessor's fleet, and (ii) in no event shall the amount
of such deductibles exceed the amount under "Deductible Amount" set forth on
Exhibit C hereto.
(c) REQUIRED POLICY DESIGNATIONS AND PROVISIONS. Each and any policy
of insurance obtained and maintained pursuant to this Section, and each and
any policy obtained in substitution or replacement for any such policies,
shall: (i) designate Lessor as owner of the Aircraft covered thereby, and
shall designate Lessor,
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and its assigns, as additional named insureds and loss payees, as its
interests may appear (but without imposing upon Lessor, or its assigns, any
obligation imposed upon the insured, including, without limitation, the
liability to pay any premiums for any such policies) ; (ii) expressly provide
that, in respect of the interests of Lessor, and its assigns, in such
policies, the insurance shall not be invalidated by any action or inaction of
Lessee, and shall insure Lessor, and its assigns, regardless of any breach or
violation of any warranty, declaration or condition contained in such
policies by Lessee; (iii) provide that if such insurance is cancelled by the
Approved Insurers for any reason whatsoever, or is adversely changed in any
way with respect to the interests of Lessor, or its assigns, or if such
insurance is allowed to lapse for nonpayment of premium, such cancellation,
adverse change or lapse shall not be effective as to Lessor, and its assigns,
for thirty days (seven days in the case of any war risks or allied perils
coverage) after receipt by Lessor of written notice by such insurer or
insurers to Lessor of such prospective cancellation, change or lapse; (iv)
include coverage for the territorial limits of any country in which the
Aircraft may at any time be located; (v) provide that, as against Lessor, and
its assigns, the insurer waives any rights of set-off, counterclaim or any
other deduction, whether by attachment or otherwise, and waives any rights it
may have to be subrogated to any right of any insured against Lessor, or its
assigns, with respect to the Aircraft; and (vi) provide that in the event of
any damage or loss, whether or not a Casualty occurrence hereunder, and which
results in a payment, such payment shall be payable directly to Lessor or its
assignee as loss payees for the account of all interests. Each such policy
shall be primary without right of contribution from any other insurance which
may be carried by Lessor, or its assigns, and shall expressly provide that
all of the provisions thereof shall operate in the same manner as if there
were a separate policy covering each insured, provided that such policies
shall not operate to increase the insurer's limit of liability.
Lessee shall have the right to carry insurance in excess of the
amounts required hereunder and the proceeds of such excess insurance shall be
payable to Lessee. Similarly, Lessor shall have the right to carry additional
and separate insurance for its own benefit at its own expense, without,
however, thereby limiting Lessee's obligations under this Section 12.
(d) APPLICATION OF INSURANCE PROCEEDS FOR A CASUALTY OCCURRENCE. It
is agreed that insurance payments which arise from insurance obtained
hereunder and received as the result of the occurrence of a Casualty
Occurrence shall be applied as follows:
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(▇) if such payments are received with respect to a
Casualty Occurrence relating to the Airframe and Engines or engines installed
on the Airframe, so much of such payments as shall not exceed the amounts due
under Section 11(a) hereof shall be paid to Lessor, and the balance to
Lessee; and
(ii) if such payments are received with respect to a Casualty
Occurrence relating to an Engine under circumstances contemplated by Section
11(b) hereof, such payment shall be adjusted with Lessee (provided that
Lessee has not breached any warranty, declaration or condition contained in
the applicable insurance policy) and paid over to Lessee, provided that
Lessee shall have fully performed or, concurrently therewith, will fully
perform the terms of Section 11(b) hereof.
(e) APPLICATION OF INSURANCE PROCEEDS FOR OTHER THAN A CASUALTY
OCCURRENCE. The insurance payments for any property damage loss to the
Airframe or any Engine not constituting a Casualty Occurrence, or to any
Part, will be held by Lessor until Lessee furnishes Lessor with satisfactory
evidence that the repairs or replacement property Lessee is required to
perform or obtain in accordance with the terms of Section 9 of this Lease
have been made or obtained by Lessee. Upon receipt of such evidence of repair
or replacement, Lessor shall pay Lessee the amount of the insurance payment
received with respect to such loss.
(f) APPLICATION IN DEFAULT. Any amount referred to in Section 12(d)(i)
or (ii) or Section 12(e) which is otherwise payable to Lessee shall not
be paid to Lessee, or, if it has been previously paid to Lessee, and not yet
applied by Lessee as permitted or required hereunder, shall be delivered by
Lessee to Lessor, if at the time of such payment, a Default or an Event of
Default shall have occurred and be continuing. In either case, all such
amounts shall be held by Lessor as security for the obligations of Lessee,
or, at the option of Lessor, applied by Lessor toward payment of any of
Lessee's obligations at the time due hereunder. At such time as there shall
not be continuing any such Default or Event of Default, all such amounts at
the time held by Lessor in excess of the amount, if any, which Lessor has
elected for application as provided above, shall be paid to Lessee.
(g) CERTIFICATES OF INSURANCE. On or before the Delivery Date, and
thereafter on each renewal by Lessee of the insurance required hereby, but
not less often than annually, Lessee will furnish to Lessor a certificate
executed and delivered by an Approved Insurance Broker who is authorized by
an Approved Insurer, appointed by Lessee, describing in reasonable detail
insurance carried on the Aircraft and certifying that the insurance then
maintained on the Aircraft complies with the terms of this Lease. Lessee will
cause such Approved Insurance Broker who is authorized
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▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇ an Approved Insurer to agree to advise Lessor in writing at least thirty
days (seven days in the case of any war risk and allied perils coverage)
prior to the non-renewal, termination or cancellation by the underwriters for
any reason (including, without limitation, failure to pay the premium
therefor) of any such insurance.
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Section 13. INDEMNIFICATION.
Lessee agrees to indemnify, reimburse, and hold harmless each
Indemnitee from and against any and all claims, damages, losses, liabilities,
demands, suits, judgments, causes of action, legal proceedings, whether civil
or criminal, penalties, fines, other sanctions, and any reasonable attorney's
fees and other reasonable costs and expenses in connection herewith,
including any of the foregoing arising or imposed with or without Lessor's
fault or negligence or under the doctrine of strict liability (any and all of
which are hereafter referred to as "Claims"), but excluding therefrom such
Claims which are based solely upon the wilful misconduct of Lessor, which in
any way may result from, pertain to, or arise in any manner out of, or are in
any manner related to (i) the Aircraft or this Lease or any document in
connection herewith, or the breach of any representation, warranty or
covenant made by Lessee hereunder or under any other such document; or (ii)
the condition, ownership, manufacture, purchase, delivery, non-delivery,
lease, acceptance, rejection, possession, return, disposition, use or
operation of the Aircraft either in the air or on the ground; or (iii) any
defect in the Aircraft (whether or not discovered or discoverable by Lessee
or Lessor) arising from the material or any articles used therein or from the
design, testing, or use thereof or from any maintenance, service, repair,
overhaul, or testing of the Aircraft, whether or not the Aircraft is in the
possession of Lessee and regardless of where the Aircraft may then be
located; or (iv) any transaction, approval, or document contemplated by this
Lease or given or entered into in connection herewith; provided, however,
that Lessee shall be subrogated to all rights and remedies which Lessor may
have against the Manufacturer of the Aircraft and its subcontractors. In the
event Lessee is required to indemnify any Indemnitee hereunder, Lessee shall
pay to such Indemnitee an amount which, after deduction of all Taxes and like
charges required to be paid by such Indemnitee in respect of such payment, is
equal to the amount of the indemnification required.
Lessee hereby waives, and releases each Indemnitee from, any Claims
(whether existing now or hereafter arising) for or on account of or arising
or in any way connected with injury to or death of personnel of Lessee or
loss or damage to property of Lessee or the loss of use of any property which
may result from or arise in any manner out of or in relation to the
ownership, leasing, condition, use, or operation of the Aircraft, either in
the air or on the ground, or which may be caused by any defect in the
Aircraft from the material or any article used therein or from the design or
testing thereof, or use thereof or from any maintenance, service, repair,
overhaul, or testing of the Aircraft regardless of when such defect may be
discovered, whether or not the Aircraft is at the time in the possession of
Lessee, and
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regardless of the location of the Aircraft at any such time; provided,
however, that such waiver and release shall not apply to Claims which are
based solely upon the wilful misconduct of Lessor.
The indemnities contained in this Section 13 shall continue in full
force and effect notwithstanding the expiration or other termination of this
Lease and are expressly made for the benefit of and shall be enforceable by
each Indemnitee.
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Section 14. LIENS.
LESSEE SHALL NOT DIRECTLY OR INDIRECTLY CREATE, INCUR, ASSUME OR
SUFFER TO EXIST ANY LIEN ON OR WITH RESPECT TO THE AIRCRAFT, TITLE THERETO OR
ANY INTEREST THEREIN, EXCEPT (i) THE RESPECTIVE RIGHTS OF LESSOR AND LESSEE
AS HEREIN PROVIDED; (ii) LESSOR'S LIENS WITH RESPECT TO THE AIRCRAFT; (iii)
LIENS FOR TAXES EITHER NOT YET DUE OR BEING CONTESTED IN ACCORDANCE WITH
SECTION 10 HEREOF AND SO LONG AS ADEQUATE RESERVES ARE MAINTAINED WITH
RESPECT TO SUCH LIENS; (iv) INCHOATE MATERIALMEN'S, MECHANICS', WORKMEN'S,
REPAIRMEN'S EMPLOYEES' OR OTHER LIKE LIENS ARISING IN THE ORDINARY COURSE OF
BUSINESS, WHICH EITHER ARE NOT DELINQUENT OR ARE BEING CONTESTED IN GOOD
FAITH BY LESSEE, SO LONG AS THE AIRCRAFT IS NOT IN DANGER OF BEING LOST,
SOLD, CONFISCATED, FORFEITED OR SEIZED AS A RESULT OF ANY SUCH LIEN. LESSEE
SHALL PROMPTLY, AT ITS OWN EXPENSE, TAKE SUCH ACTION AS MAY BE NECESSARY TO
DULY DISCHARGE ANY LIEN (EXCEPT FOR THE LIENS REFERRED TO IN CLAUSES (i) AND
(ii) OF THIS SECTION 14) IF THE SAME SHALL ARISE AT ANY TIME WITH RESPECT TO
THE AIRCRAFT.
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Section 15. PERFECTION OF TITLE AND FURTHER ASSURANCES.
If at any time subsequent to the initial recordation of title under
this Lease, any filing or recording is reasonably necessary to protect the
interest of Lessor, Lessee, at its own cost and expense and upon request by
Lessor, shall cause this Lease and any and all additional instruments which
shall be executed pursuant to the terms hereof, to be kept, filed and recorded
and to be re-executed, refiled and re-recorded in the appropriate office
pursuant to applicable Laws, to perfect, protect and preserve the rights and
interests of Lessor hereunder and in the Aircraft. At the reasonable request of
Lessor, Lessee shall furnish to Lessor an opinion of counsel or other evidence
satisfactory to Lessor of each such filing or refiling and recordation or
re-recordation.
Without limiting the foregoing, Lessee shall do or cause to be done,
at Lessee's cost and expense, any and all acts and things which may be required
under the terms of the Mortgage Convention to perfect and preserve the title
and interest of Lessor in the Aircraft within the jurisdiction of any signatory
which has ratified the Mortgage Convention if such jurisdiction is in the
territory in which Lessee may operate the Aircraft, as Lessor may reasonably
request. Lessee shall also do or cause to be done, at its own expense, any and
all acts and things which may be required under the terms of any other Law
involving any jurisdiction in which Lessee may operate, or any and all acts and
things which Lessor may reasonably request, to perfect and preserve Lessor's
ownership rights regarding the Aircraft within any such jurisdiction.
In addition, Lessee will promptly and duly execute and deliver to
Lessor such further documents and assurances and take such further actions as
it may from time to time reasonably request in order to more effectively carry
out the intent and purpose of this Lease and to establish and protect the
rights and remedies created or intended to be created in favor of Lessor
hereunder, including, without limitation, if reasonably requested by Lessor at
the expense of Lessee, the execution and delivery of supplements or amendments
hereto in recordable form, subjecting to this Lease any Replacement Engine and
the recording or filing of counterparts thereof, in accordance with the laws of
any appropriate jurisdiction.
Notwithstanding anything to the contrary contained in this
Section 15, Lessee shall not bear the cost and expense of complying with any
request by Lessor under this Section 15 which arises out of a transfer or
proposed transfer by Lessor of its interest in the Aircraft and Lessor shall
reimburse Lessee for its reasonable costs and expenses of complying with any
such request.
15-1
PHC 90-047-WKH
Section 16. Return OF AIRCRAFT AND RECORDS.
(a) RETURN. On the Expiration Date, Lessee, at its own expense, shall
return the Aircraft to Lessor in the condition specified on Exhibit E hereto at
the location specified as "Return Location" set forth on Exhibit C hereto,
fully equipped with all required Parts and Engines, duly installed thereon,
together with Aircraft Documents and records which are complete and acceptable
to the FAA, by delivering the same to Lessor at such location. Any Engines
installed on the Aircraft returned to Lessor hereunder which had not originally
been installed on the Aircraft will be deemed to be part of the Aircraft and
owned by Lessor, provided Lessor relinquishes title to any Engines previously
removed and replaced by such last-installed Engines.
(b) LEGAL STATUS UPON RETURN. Upon the Return Occasion, the Aircraft
shall be: (i) free and clear of all Liens, except Lessor's Liens; (ii) duly
certified as an airworthy aircraft by the FAA with the current and valid
airworthiness certificate installed on the Aircraft; (iii) in full airworthy
condition for operation according to the FAA standards required to allow the
Aircraft to be operated under the rules of Part 121 of the FAA Regulations;
(iv) duly registered in the name of Lessor under the applicable Law of the
jurisdiction of registry; and (v) in full compliance with the Maintenance
Program.
(c) SUBSTITUTE ENGINES. Lessee may return the Aircraft on the Return
Occasion with a Substitute Engine so long as (i) the Substitute Engine conforms
in all respects to requirements set forth in Section 11(b) hereof with respect
to a Replacement Engine; (ii) the Substitute Engine shall conform to the return
condition requirements set forth in Section 16(f) hereof; and (iii) Lessee, at
its own expense and concurrently with such delivery, furnishes Lessor with a
▇▇▇▇ of sale, in form and substance reasonably satisfactory to Lessor, with
respect to the Substitute Engine and with evidence of Lessee's full and
unencumbered title to the Substitute Engine (including, if requested, an
opinion of Lessee's counsel to the effect of the opinion required by Section
11(b) (iv) hereof) and takes such other action as Lessor may reasonably
request in order that title to the Substitute Engine shall be duly and fully
vested in Lessor. Lessee's obligation to comply with the terms of this Section
16(c) shall be conditioned on Lessor's transferring to Lessee any Engine not
installed on the Aircraft at the Return Occasion, without any representation,
warranty, or recourse of any kind whatsoever, express or implied, except a
warranty that Lessor has good title and that such Engine is free and clear of
Liens, other than Liens which Lessee is required to discharge hereunder, or
defects in title resulting from acts of Lessee.
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(▇) RECORDS. Upon the Return Occasion, Lessee shall deliver to Lessor
all logs, manuals, and data and inspection, modification and overhaul records
which are required to be maintained with respect thereto under applicable
rules and regulations of the FAA.
(e) SERVICE BULLETIN AND MODIFICATION KITS. At or upon the return of
the Aircraft pursuant to this Section 16, Lessee shall deliver to Lessor, at no
cost to Lessor, all service bulletin kits furnished without charge by a
manufacturer for installation on the Aircraft which have not been so installed
together with appropriate instructions for installation. In the event such
uninstalled kits were purchased or manufactured by Lessee, then Lessor shall
have a right to purchase such kits at Lessee's cost for a period of one hundred
eighty days (180) after return.
(f) CONDITION OF AIRCRAFT. Upon the Return Occasion applicable to the
Aircraft, Lessee shall return the Aircraft to Lessor in such condition that the
Aircraft shall comply with all of the conditions set forth on Exhibit E hereto.
(g) FINAL INSPECTION. In connection with the performance by Lessee of
the "C" Check (or its equivalent) immediately prior to the Return Occasion, in
accordance with the provisions of Paragraph (14) of Exhibit F, Lessee shall
make the Aircraft available to Lessor at Lessee's principal maintenance base
for detailed inspection, at Lessee's expense, in order to verify that the
condition of the Aircraft complies with the requirements set forth above (such
inspection being hereinafter referred to as the "Final Inspection"). Lessor
shall cause the Final Inspection to be conducted only during those times when
the Aircraft is not engaged in operation. Lessee shall give Lessor not less
than ten days prior written notice of the commencement date of such Final
Inspection. The period allowed for the Final Inspection shall have such
duration as to permit the opening of any areas of the Aircraft which would be
opened by Lessee to satisfy the requirements of Exhibit E. A Final Inspection
shall commence on or before the Expiration Date with respect to the Aircraft
and shall continue on consecutive days until all activity required above to be
conducted during the Final Inspection has been concluded. To the extent that
any portion of the Final Inspection extends beyond the Expiration Date, the
Term shall be deemed to have been automatically extended, and the obligation to
pay Rent hereunder continued on a daily basis until the Final Inspection shall
have been concluded. All storage expenses attributable to any extension of the
Term pursuant to preceding sentence shall be payable by Lessee.
(h) AIRCRAFT DOCUMENTATION. In order to enable Lessor to prepare for
the Final Inspection of the Aircraft pursuant to Section 16(g) above, Lessee
agrees to make available to Lessor at Lessee's principal maintenance base not
later than ten days prior
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to the commencement of such Final Inspection, the Aircraft Documents listed on
Exhibit B hereto, together with such other documentation regarding the
condition, use, maintenance, operation, and history of the Aircraft during
Lessee's possession as Lessor may reasonably request.
(i) CORRECTIONS AND SUBSEQUENT CORRECTIONS. To the extent that the
Aircraft or any Engine fails upon the Return Occasion to conform to any
requirement imposed by this Lease and particularly Section 16(f), Lessor, at
its option, may continue the Lease in effect in the manner provided for in
Section 16(g) above with regard to automatic extension until such time as the
Aircraft is brought up to the condition required by Section 16(f) above or
accept the return of the Aircraft and thereafter have any such nonconformance
corrected, at such time as Lessor may deem appropriate but not to occur later
than ninety days following the return of the Aircraft, at commercial rates then
charged by the Person selected by Lessor to perform such correction. Any direct
expense incurred by Lessor for such correction shall become Supplemental Rent
payable by Lessee within thirty days following the submission of a written
statement by Lessor to Lessee, identifying the items corrected and setting
forth the expense of such correction. Lessee's obligations to pay such
Supplemental Rent shall survive the passage of the Expiration Date or other
termination of this Lease.
(j) ADDITIONAL MAINTENANCE, REPAIR OR OVERHAUL. Upon the Return
Occasion and upon written request of Lessor, Lessee shall perform such
additional maintenance, repair, or overhaul of the Aircraft as is requested by
Lessor in the same manner and with the same care as used for similar aircraft
and engines owned by Lessee, provided that Lessor shall pay Lessee at
reasonable rates mutually agreed upon in connection with such maintenance,
repair, or overhaul, and such additional maintenance, repair or overhaul shall
not extend this Lease.
(k) FUNCTIONAL CHECK FLIGHT. Immediately prior to the expiration of
the Term, a qualified pilot and not more than two technical representatives
selected by Lessor, in conjunction with Lessee's flight crew, will accomplish a
functional check flight in accordance with Lessee's procedures and at Lessee's
expense to demonstrate the airworthiness of the Aircraft and proper functioning
of all systems and components; provided, that Lessor shall be responsible for
the charges of such qualified pilot and technical representatives. At all times
during such functional check flight Lessee's flight crew shall be in command of
the Aircraft. Any discrepancy or malfunction detected of an airworthiness or
operational nature by normal airline standards
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇ corrected, at Lessee's expense. To the extent possible the functional
check flight shall be combined with the return of the Aircraft under Section
16(a).
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
Section 17. Events OF DEFAULT.
Any one or more of the following occurrences or events shall
constitute an Event of Default:
(a) Lessee shall fail to make any payment of Rent to Lessor when due
under this Lease and such payment shall be overdue for a period of five (5)
Business Days;
(b) Lessee shall fail to obtain and maintain any insurance required
under the provisions of Section 12 hereof; or shall operate the Aircraft
outside of the scope of the insurance coverage maintained with respect to the
Aircraft;
(c) Any representation or warranty made by Lessee herein or in any
document or certificate furnished Lessor in connection herewith or therewith
or pursuant hereto, is incorrect at the time given in any material respect;
(d) Lessee shall fail to perform or observe any other covenant,
condition or agreement to be performed or observed by it pursuant to this Lease
and such failure shall continue for a period of thirty (30) days after written
notice thereof is given by Lessor to Lessee;
(e) Lessee consents to the appointment of a receiver, trustee or
liquidator of itself or of a substantial part of its property, or Lessee admits
in writing its inability to pay its debts generally as they come due, or makes
a general assignment for the benefit of creditors, or Lessee files a voluntary
petition in bankruptcy or a voluntary petition seeking reorganization in a
proceeding under any bankruptcy laws (as now or hereafter in effect), or an
answer admitting the material allegations of a petition filed against Lessee in
any such proceeding, or Lessee by voluntary petition, answer or consent seeks
relief under the provisions of any bankruptcy or other similar law providing
for the reorganization or winding-up of corporations, or provides for an
agreement, composition, extension or adjustment with its creditors;
(f) An order, judgment or decree is entered by any court, with or
without the consent of Lessee, appointing a receiver, trustee or liquidator for
Lessee or of all or any substantial part of its property, or all or any
substantial part of the property of Lessee is sequestered, and any such order,
judgment or decree of appointment or sequestration remains in effect,
undismissed, unstayed or unvacated for a period of sixty (60) days after the
date of entry thereof;
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
(▇) A petition against Lessee in a proceeding under the bankruptcy,
insolvency or other similar Laws (as now or hereafter in effect) of any
Governmental Entity is filed and is not withdrawn or dismissed within sixty
days thereafter, or if, under the provisions of any Law providing for
reorganization or winding-up of corporations which may apply to Lessee, any
court of competent jurisdiction assumes jurisdiction over, or custody or
control of, Lessee or of all or any substantial part of its property and such
jurisdiction, custody or control remains in effect, unrelinquished, unstayed or
unterminated for a period of sixty (60) days;
(h) A final judgment for the payment of money not covered by insurance
in excess of Two Hundred Fifty Thousand Dollars ($250,000), or final judgments
for the payment of money not covered by insurance in excess of Five Hundred
Thousand Dollars ($500,000) in the aggregate, shall be rendered against Lessee
and the same shall remain undischarged for a period of ninety days during which
execution thereof shall not be effectively stayed by agreement of the parties
involved, stayed by court order or adequately bonded or attachments or other
Liens, except for security interests;
(i) Attachments or other Liens shall be issued or entered against
substantially all of the property of Lessee and shall remain undischarged or
unbonded for ninety days except for security interests created in connection
with monies borrowed or obligations agreed to by Lessee in the ordinary course
of its business;
(j) Lessee shall default in the payment of any obligation for the
payment of borrowed money, for the deferred purchase price of property or for
the payment of rent or hire under any lease of aircraft which has a principal
amount of Seven Hundred and Fifty Thousand Dollars ($750,000) or more
(determined in the case of borrowed money by the amount outstanding under the
agreement pursuant to which such borrowed money was borrowed, in the case of a
deferred purchase price by the remaining balance and in the case of a lease by
the present discounted value of the remaining rent or hire payable thereunder
(ignoring any fair market renewal)) when the same becomes due if such
nonpayment results in an acceleration of such indebtedness; or Lessee shall
default in the performance of any other term, agreement or condition contained
in any material agreement or instrument under or by which any such obligation
is created, evidenced or secured, if the effect of such default is to cause or
allow such obligation to become due prior to its stated maturity;
(k) the occurrence of an "event of default" under and as defined in
that certain Irrevocable and Unconditional Guaranty issued by the Guarantor in
favor of Lessor; or
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
(▇) the occurrence of an "event of default" under and as defined in
any of those certain four
Aircraft Lease Agreements, dated June 21, 1988
between Lessor, as lessor, and Lessee, as lessee.
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
Section 18. REMEDIES.
Upon the occurrence of any Event of Default and any time thereafter
so long as the same shall be continuing, Lessor may, at its option and without
notice to Lessee, exercise one or more of the following remedies as Lessor in
its sole discretion shall elect, to the extent available and permitted by, and
subject to compliance with any mandatory requirements of, applicable Law then
in effect:
(a) Demand that Lessee, and Lessee shall upon the written demand of
Lessor and at Lessee's expense, immediately return the Aircraft to Lessor in
the manner specified in such notice, in which event such return shall not be
delayed for purposes of complying with the return conditions specified in
Section 16 hereof (none of which conditions shall be deemed to affect Lessor's
possession of the Aircraft) or delay for any other reason. Notwithstanding the
foregoing, at Lessor's option Lessee shall be required thereafter to take such
actions as would be required by the provisions of this Lease if the Aircraft
were being returned at the end of the Term hereof and Lessor agrees to
cooperate with Lessee's required actions. In addition, Lessor, at its option
and to the extent permitted by applicable Law, may enter upon the premises
where all or any part of the Aircraft is located and take immediate possession
of and, at Lessor's sole option, remove the same (and/or any engine which is
not an Engine but which is installed on the Airframe, subject to the rights of
the owner, lessor or secured party thereof) by summary proceedings or
otherwise, all without liability accruing to Lessor for or by reason of such
entry or taking of possession whether for the restoration of damage to
property, or otherwise, caused by such entry or taking, except damages caused
by gross negligence or willful misconduct.
(b) Sell at private or public sale, as Lessor may determine, or hold,
use, operate or lease to others the Aircraft as Lessor in its sole discretion
may determine, all free and clear of any rights to Lessee.
(c) Whether or not Lessor shall have exercised, or shall thereafter at
any time exercise, any of its rights under paragraph (a) or paragraph (b) of
this Section 18, Lessor, by thirty days written notice to Lessee specifying a
payment date, may demand that Lessee pay to Lessor, and Lessee shall pay to
Lessor, on the payment date specified in such notice, as liquidated damages
for loss of bargain and not as a penalty (in lieu of the Basic Rent and
Additional Rent due for the period commencing after the date specified for
payment in such notice), any unpaid Rent for the Aircraft (prorated in the
case of Basic Rent and Additional Rent on a daily basis) to and including the
payment date specified in such notice, PLUS the amount, if any, by which the
aggregate Basic
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
Rent and aggregate Additional Rent for the remainder of the Term, discounted
periodically (equal to installment frequency) to present worth at the interest
rate of six percent per annum, exceeds the fair market rental value (determined
pursuant to the Appraisal Procedure) of the Aircraft for the remainder of the
Term after discounting such fair market rental value periodically (equal to
installment frequency) to present worth as of the payment date specified in
such notice at the interest rate of six percent per annum.
(d) In the event Lessor, pursuant to Section 18(b) above, shall have
sold the Aircraft, Lessor, in lieu of exercising its rights under Section 18(c)
above, may, if it shall so elect, demand that Lessee pay Lessor, and Lessee
shall pay to Lessor, as liquidated damages for loss of bargain and not as a
penalty (in lieu of the Basic Rent and Additional Rent due for the period
commencing after such sale occurs), any unpaid Rent for the Aircraft due to
and including the date of sale, PLUS the amount by which the Casualty Value of
the Aircraft, computed as of the date of such sale, exceeds the net cash
proceeds of such sale.
(e) In the event that Lessor, pursuant to Section 18(b) above, shall
have relet the Aircraft under a lease which extends at least to the date upon
which the Term for the Aircraft would have expired but for Lessee's default,
Lessor, in lieu of exercising its rights under Section 18(c) above with
respect to the Aircraft, may, if it shall so elect, demand that Lessee pay
Lessor, and Lessee shall pay Lessor, as liquidated damages for loss of bargain
and not as a penalty (in lieu of the Basic Rent and Additional Rent for the
Aircraft due after the time of reletting) any unpaid Rent for the Aircraft due
up to the date of reletting, PLUS the amount, if any, by which the aggregate
Basic Rent and aggregate Additional Rent for the Aircraft, which would
otherwise have become due over the Term, discounted periodically (equal to
installment frequency) to present worth as of the date of reletting at the
interest rate of six percent per annum, exceeds the aggregate basic rental
payments to become due under the reletting from the date of such reletting to
the date upon with the Term for the Aircraft would have expired but for
Lessee's default, discounted periodically (equal to installment frequency) to
present worth as of the date of the reletting at the interest rate of six
percent per annum.
(f) Proceed by appropriate court action or actions, either at law or
in equity, to enforce performance by Lessee of the applicable covenants of
this Lease and to recover damages for the breach thereof and to rescind this
Lease.
(g) Terminate the Lease by written notice, which notice shall be
effective upon dispatch.
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇ addition to the foregoing, Lessee shall be liable for any and all
unpaid Rent during or after the exercise of any of the aforementioned remedies,
together with interest on such unpaid amounts at the Interest Rate, and until
satisfaction of all of Lessee's obligations to Lessor hereunder and for all
reasonable legal fees and other reasonable costs and expenses incurred by
Lessor by reason of the occurrence of any Event of Default or the exercise of
Lessor's remedies with respect thereto, including all costs and expenses
incurred in connection with the return of the Aircraft in accordance with the
terms of Section 16 hereof or in placing the Aircraft in the condition and with
airworthiness certification as required by such Section.
In effecting any repossession, Lessor, its representatives and agents,
to the extent permitted by law shall: (i) have the right to enter upon any
premises where it reasonably believes the Aircraft, the Airframe, an Engine or
Part to be located; (ii) not be liable, in conversion or otherwise, for the
taking of any personal property of Lessee which is in or attached to the
Aircraft, the Airframe, an Engine or Part which is repossessed; provided,
however, that Lessor shall return to Lessee all personal property of Lessee or
its passengers which were on the Aircraft at the time Lessor re-takes
possession of the Aircraft; (iii) not be liable or responsible, in any manner,
for any inadvertent damage or injury to any of Lessee's property in
repossessing and holding the Aircraft, the Airframe, an Engine or Part, except
for that caused by or in connection with Lessor's gross negligence or willful
acts; (iv) have the right to maintain possession of and dispose of the
Aircraft, the Airframe, an Engine or Part on any premises owned by Lessee or
under Lessee's control; and (v) have the right to obtain a key to any premises
at which the Aircraft, the Airframe, an Engine or Part may be located from the
landlord or owner thereof.
If reasonably required by Lessor, Lessee, at its sole expense, shall
assemble and make the Aircraft, the Airframe, an Engine or Part available at a
place designated by Lessor in accordance with Section 16 hereof. Lessee hereby
agrees that, in the event of the return to or repossession by Lessor of the
Aircraft, the Airframe, an Engine or Part, any rights in any warranty (express
or implied) heretofore assigned to Lessee or otherwise held by Lessee shall
without further act, notice or writing be assigned or reassigned to Lessor, if
assignable. Lessee shall be liable to Lessor for all reasonable expenses,
disbursements, costs and fees incurred in (i) repossessing, storing,
preserving, shipping, maintaining, repairing and refurbishing the Aircraft, the
Airframe, an Engine or Part to the condition required by Section 16 hereof and
(ii) preparing the Aircraft, the Airframe, an Engine or Part for sale or lease,
advertising the sale or lease of the Aircraft, the Airframe, an Engine or Part
and selling or releasing the Aircraft, the Airframe,
▇▇-▇
.▇▇▇ ▇▇-▇▇▇ ▇▇▇
an Engine or Part. Lessor is hereby authorized and instructed, at its option,
to make reasonable expenditures which Lessor considers advisable to repair
and restore the Aircraft, the Airframe, an Engine or Part to the condition
required by Section 16 hereof, all at Lessee's sole expense.
At any public sale of the Aircraft, the Airframe, an Engine or Part
pursuant to this Section, both Lessor and Lessee may bid for and purchase such
property and Lessee agrees that the amounts paid therefor shall be used in the
computation contemplated herein.
No remedy referred to in this Section 18 is intended to be exclusive,
but, to the extent permissible hereunder or under applicable Law, each shall be
cumulative and in addition to any other remedy referred to above or otherwise
available to Lessor at Law or in equity; and the exercise or beginning of
exercise by Lessor of any one or more of such remedies shall not preclude the
simultaneous or later exercise by Lessor of any or all of such other remedies.
No express or implied waiver by Lessor of any Default or Event of Default shall
in any way be, or be construed to be, a waiver of any future or subsequent
Default or Event of Default.
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
Section 19. ALIENATION.
Lessor shall have the right at its sole cost and expense to assign,
sell or encumber any interest of Lessor in the Aircraft or this Lease and/or
the proceeds hereof subject to the rights of Lessee under the provisions of
this Lease. To effect or facilitate any such assignment, sale or encumbrance,
Lessee agrees to provide, at Lessor's sole cost and expense, such agreements,
consents, conveyances or documents as may be reasonably requested by Lessor,
which shall include, without limitation, an unrestricted release of Lessor from
its obligations under this Lease; provided, however that such release shall not
release Lessor from any liability hereunder which arose prior to any such
assignment, sale, or encumbrance. Lessee hereby agrees that it will not assert
against an assignee any claim or defense which it may have against Lessor. The
agreements, covenants, obligations, and liabilities contained herein including,
but not limited to, all obligations to pay Rent and indemnify each Indemnitee
are made for the benefit it of each Indemnitee and their respective successors
and assigns.
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
Section 20. MISCELLANEOUS.
(a) SEVERABILITY, AMENDMENT AND CONSTRUCTION. Any provision of this
Lease 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 provisions hereof; any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction. To the
extent permitted by Law, Lessee hereby waives any provisions of Law which
renders any provisions hereof prohibited or unenforceable in any respect.
This Lease supercedes any prior or contemporaneous agreements, whether oral
or in writing, of the parties hereto and shall constitute the entire
agreements of the parties hereto. No term or provision of this Lease may be
changed, waived, discharged or terminated orally, but only by an instrument
in writing expressed to be a supplement to this Lease signed under hand by an
officer of the party against which the enforcement of the change, waiver,
discharge or termination is sought. This Lease shall constitute an agreement
of lease, and nothing herein shall be construed as conveying to Lessee any
right, title or interest in the Aircraft or any Engine or Part except as a
lessee only. The headings in this Lease are for convenience of reference only
and shall not define or limit any of the terms of provisions hereof. Whenever
required by the context hereof, the singular shall include the plural and
vice versa. Reference to this Lease shall mean this Lease as amended or
supplemented from time to time.
(b) GOVERNING LAW; JURISDICTION. This Lease shall in all respects be
governed by, and construed in accordance with, the laws of the State of
California, except to the extent where those laws are governed by the federal
laws of the United States including all matters of construction, validity and
performance. Lessee hereby irrevocably consents that any legal action or
proceeding against it or any of its assets with respect to the Lease may be
brought in any jurisdiction where Lessee or any of its assets may be found,
or in any court of the State of
California or any Federal court of the United
States of America located in San Francisco,
California, United States of
America, or both, as Lessor may elect, and by execution and delivery of this
Lease Lessee hereby irrevocably submits to and accepts with regard to any
such action or proceeding, for itself and in respect of its assets, generally
and unconditionally, the jurisdiction of the aforesaid courts. Lessee hereby
irrevocably designates, appoints and empowers C T Corporation System at its
principal office in Los Angeles,
California, currently located at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, as its authorized agent for service of process in the
State of
California in any suit or proceeding with respect to this Lease. A
copy of any such process served on such agent shall be promptly forwarded by
airmail by the person commencing such proceeding to
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇ at its address set forth on Exhibit C hereto, but the failure of
Lessee to receive such copies shall not affect in any way the service of such
process as aforesaid. Lessee further irrevocably consents to the service of
process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified
airmail, postage prepaid, to Lessee at its address set forth on Exhibit C
hereto. The foregoing, however, shall not limit the rights of Lessor to serve
process in any other manner permitted by Law or to bring any legal action or
proceeding or to obtain execution of judgment in any jurisdiction. Lessee
further agrees that final judgment against Lessee in any action or proceeding
in connection with this Lease shall be conclusive and may be enforced in any
other jurisdiction within or outside the United States of America by suit on
the judgment, a certified or exemplified copy of which shall be conclusive
evidence of the fact and the amount of Lessee's indebtedness. Lessee hereby
irrevocably waives, to the fullest extent permitted by law, any objection
which Lessee may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Lease brought in the
State of
California, and hereby further irrevocably waives any claim that any
such suit, action or proceeding brought in the State of
California has been
brought in an inconvenient forum.
(c) NOTICES. All notices required under the terms and provisions
hereof shall be in writing, shall be sent to Lessor or Lessee at their
respective addresses set forth on Exhibit C hereto (or such other addresses
as the parties may designate from time to time in writing) and such notice
shall become effective upon the earlier of actual receipt or the fifth day
following the date such notice is sent.
(d) LESSOR'S RIGHT TO PERFORM FOR LESSEE. If Lessee fails to make
any payment of Supplemental Rent required to be made by it hereunder or fails
to perform or comply with any covenant, agreement or obligation contained
herein, Lessor shall have the right but not the obligation to make such
payment or conform or comply with such agreement, covenant or obligation, and
the amount of such payment and the amount of the reasonable expenses of
Lessor incurred in connection with such payment or the performance thereof or
compliance therewith, together with interest thereon at the Interest Rate,
shall be payable by Lessee to Lessor (as Supplemental Rent) upon demand.
Lessor agrees to notify Lessee in writing prior to making any payment under
this Section 20(d), unless the Aircraft will be in danger of loss, sale,
confiscation, forfeiture or seizure should such payment not be made. The
taking of any such action by Lessor pursuant to this Subsection 20(d) shall
not constitute a waiver or release of any obligation of Lessee under the
Lease, nor a waiver of any Event of Default which may arise out of Lessee's
nonperformance of such obligation, nor
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
an election or waiver by Lessor of any remedy or right available to Lessor
under or in relation to this Lease.
(e) COUNTERPARTS. This Lease may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. To the extent,
if any, that this Lease constitutes chattel paper (as such term is defined in
the Uniform Commercial Code as in effect in any applicable jurisdiction) no
security interest in this Lease may be created through the transfer or
possession of any counterpart other than the counterpart which has been
marked "Original" on the signature page thereof.
(f) QUIET ENJOYMENT. Lessor covenants that so long as an Event of
Default shall not have occurred and be continuing, Lessee shall quietly enjoy
the Aircraft and all rents, revenues, profits and income thereto, without
interference by Lessor, or by any Person lawfully claiming by or through
Lessor.
(g) BROKERS. Each party agrees to indemnify and hold the other
harmless from and against any and all claims, suits, damages, costs and
expenses (including, but not limited to reasonable attorneys' fees) asserted
by any agent, broker or other third party for any commission or compensation
of any nature whatsoever based upon the lease of the Aircraft, if such claim,
damage, cost or expense arises out of any action or alleged action by the
indemnifying party, its employees or agents.
▇▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇ WITNESS WHEREOF, Lessor and Lessee, each pursuant to due
authority, have each caused this Lease to be executed BY their duly
authorized officers as of the DAY and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By:
-----------------------------------
Title:
--------------------------------
LESSEE:
ALOHA AIRLINES, INC.
By: [Illegible]
-----------------------------------
Title: SENIOR VICE-PRESIDENT, FINANCE
AND CHIEF FINANCIAL OFFICER
--------------------------------
By: [Illegible]
-----------------------------------
Title: SENIOR VICE-PRESIDENT,
OPERATIONS
--------------------------------
-S-
PHC 90-047 WKH
IN WITNESS WHEREOF, Lessor and Lessee, each pursuant to due
authority, have each caused this Lease to be executed by their duly
authorized officers as of the day and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By: [Illegible]
-----------------------------------
Title: VICE-PRESIDENT; ASSOCIATE
GENERAL COUNSEL
--------------------------------
LESSEE:
ALOHA AIRLINES, INC.
By:
-----------------------------------
Title:
--------------------------------
By:
-----------------------------------
Title:
--------------------------------
-S-
PHC 90-047 WKH
EXHIBIT A
TO
AIRCRAFT LEASE AGREEMENT
SCHEDULE AND DESCRIPTION OF AIRCRAFT
MODEL AND MANUFACTURER'S
ITEM MANUFACTURER CONFIGURATION SERIAL NUMBER
---- ------------ ------------- --------------
Aircraft The Boeing Company 737-2M6C 21809
Engines ▇▇▇▇▇ & ▇▇▇▇▇▇▇ JT8D-15 P702833B
P702835B
CONFIGURATION
At the time of delivery the passenger cabin shall be in 112 Economy seats
configuration with a quantity of four galleys.
Installed Galleys shall be JAMCO manufacture type B1 730-1 Galley System.
All passenger seats provided shall be ▇▇▇▇▇▇ ▇▇▇▇▇ Economy type.
All passenger seats and flight attendant seats shall be fire blocked in
accordance with FAR 25.853 Appendix F.
ADDITIONAL EQUIPMENT
Annexed hereto as Exhibit A-1 is a list describing additional equipment which
is part of this Lease.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ A-1
TO
AIRCRAFT LEASE AGREEMENT
ADDITIONAL EQUIPMENT
FLIGHT DECK
ITEM DESCRIPTION QTY LOCATION
---- ----------- --- --------
1 CRASH AXE 1 FLIGHT DECK ENTRANCE LH
SIDE
2 ASBESTOS GLOVES 1 FLIGHT DECK RH SIDE REAR
OF F/O'S SEAT
3 CAPT'S SEAT BELT ASSY 1
4 CAPT'S LIFE VEST 1 BACK OF CAPT'S SEAT
5 CAPT'S SMOKE GOGGLES 1 CAPT'S SIDEWALL RECEPTACLE
6 CAPT'S OXYGEN MASK 1 LH SIDE ▇▇▇▇ ▇▇▇▇
▇ CAPT'S HEADSET ASSY 1 CAPT'S SIDEWALL AREA
8 CAPT'S ESCAPE TAPE 1 LH SIDE ROOF RECEPTACLE
9 CAPT'S ANTI GLARE SHIELD 2 LOCATION IN 4 AND 5 EYEBROW
WINDOWS LH
10 CAPT'S SUNVISOR (STOWED) 1 LH SIDE LOWER SIDEWALL
RECEPTACLE
11 F/O'S SEAT BELT ASSY 1
12 F/O'S LIFE VEST 1 BACK OF F/O'S SEAT
13 F/O'S SMOKE GOGGLES MASK 1 F/O'S SIDEWALL RECEPTACLE
14 F/O'S OXYGEN ▇▇▇▇ ▇ ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇ F/O'S HEADSET ASSY 1 F/O'S ▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇ F/O'S ESCAPE TAPE 1 RH SIDE ROOF RECEPTACLE
▇-▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
17 F/O'S ANTI GLARE SHIELD 2 LOCATED IN 4 AND 5 EYEBROW
WINDOWS RH
18 F/O'S SUNVISOR (STOWED) 1 RH SIDE LOWER SIDEWALL
RECEPTACLE
19 C02 FIRE EXTINGUISHER 1 RH SIDE LOWER REAR SIDEWALL
20 SMOKE HOOD 1 FLIGHT DECK RH SIDE REAR
OF F/O'S SEAT
21 SPARE FILAMENTS 1 RECEPTACLE BELOW F/O'S
SIDEWALL AIR LOUVRE
22 OBSERVER'S SEAT BELT 2
23 OBSERVER'S LIFE VEST 2 ONE BACK OF CAPT'S SEAT
ONE BACK OF F/O'S SEAT
24 OBSERVER'S SMOKE GOGGLES 2 OBSERVER'S SEAT RECEPTACLE
ONE AT EACH STATION
25 OBSERVER'S OXYGEN MASK 2 ONE ABOVE EACH STATION
26 EMERGENCY TRANSMITTER 1 FITTED UNDER 2ND OBS'S SEAT
27 HAND MIC - LM 096 1 REAR CENTRE PEDESTAL
28 CURTAIN ASSY 1 RH SIDE GALLEY
29 SERVICE DOOR ESCAPE SLIDE 1 RH SERVICE DOOR
30 SERVICE DOOR SAFETY STRAP 1 RH SIDEWALL FWD OF DOOR CUTOUT
31 PAX DOOR ESCAPE SLIDE 1 LH ENTRANCE DOOR
32 PAX DOOR SAFETY STRAP 1 LH SIDEWALL REAR OF DOOR
CUTOUT
33 FWD ATTENDANT SEAT 2 ENTRANCE LH B/HD BEHIND
BELTS ASSY SEAT
A-1-2
PHC 90-047 WKH
34 FWD ATTENDANT LIFE VESTS 2 BEHIND ATTENDANTS SEAT BACK
35 3 LBS BCF FIRE 1 LH OUTBOARD SIDE OF
EXTINGUISHER ATTENDANTS SEAT INSTALLATION
36 EMERGENCY TORCH 1 ABOVE ATTENDANTS SEAT
37 FIRE EXTINGUISHER H20 1 FWD PAX DOOR ESCAPE SLIDE
COVER
38 CURTAIN ASSY 1 FIRST CLASS COMPT. ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇ ▇▇▇▇
40 DUST PAN 1 WINDSCREEN LOCKER - COMPT. 7-06
41 POWER MEGAPHONE 1 WINDSCREEN LOCKER - COMPT. 7-05
PAX CABIN AREA
42 PAX SEAT BELT ASSY 112 ONE SEAT EACH SEAT
43 PAX LIFE VESTS 112 POCKET UNDER EACH SEAT
44 ESCAPE TAPES 2 AT OVERWING EXITS (1 EACH)
45 EMERGENCY TRANSMITTER 1 RH REAR BULKHEAD
46 A/C MICROFILM MANUALS 1 GALLEY COMPT. 3.16
47 POWER MEGAPHONE 1 LOWER RH REAR BULKHEAD
48 POTABLE OXYGEN 3 LOWER LH REAR BULKHEAD
BOTTLES PLUS MASK
49 BCF FIRE EXTINGUISHER 1 RH REAR BULKHEAD
50 H20 FIRE EXTINGUISHER 1 RH REAR BULKHEAD
AFT GALLEY AREA
51 CURTAIN ASSY 1 ▇▇ ▇▇▇▇▇▇ ENTRANCE
52 SERVICE DOOR ESCAPE 1 RH SIDE SERVICE DOOR
A-1-3
PHC 90-047 WKH
53 SERVICE DOOR SAFETY STRAP 1 RH SIDE FWD OF DOOR CUTOUT
54 ATTENDANTS SEAT BELTS 4 LH AFT BULKHEAD
55 ATTENDANTS SEAT VESTS 4 BEHIND ATTENDANTS SEAT
56 PAX DOOR ESCAPE SLIDE 1 LH ENTRANCE DOOR
57 PAX DOOR SAFETY STRAP 1 FWD OF DOOR CUTOUT
58 EMERGENCY TORCH - 1 O/B OF EACH ATTENDANTS STATION
V8-UEB/UEC
FWD & AFT CARGO HOLDS
59 CARGO NET ASSY 1 AFT HOLD DOOR AREA
60 CARGO NET ASSY 1 FWD HOLD DOOR AREA
61 TRASH BINS 2 FWD LAVATORY
62 TRASH BINS 2 REAR LAVATORY LH
63 TRASH BINS ▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇▇ ROYLIN DRAIN CAPS 2 BOTH EXTERNAL DRAIN POINTS
OTHER EQUIPMENT
65 CARGO BARRIER NET 1
66 FIRE EXTINGUISHER 1
WITH APPLICATOR
67 LIFE RAFT 1
68 LIFE RAFT 1
69 LIFE RAFT 1
70 SIDEWALL PROTECTER 2
71 THRESHOLD PROTECTER 1
72 EMERGENCY WATER 4
73 SMOKE DIVIDER ASSY 1
FWD, CNT, AF
A-1-4
PHC 90-047 WKH
74 DOOR AND TWO SUPPORT 1
75 SUPPORT ASSY 1
76 TAIL STEADY 1
77 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
78 PLT. 46966-106 1
79 PLT. 46966-107 1
80 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
81 PIT. ▇▇-▇▇▇▇▇-▇▇▇ 1
82 PIT. ▇▇-▇▇▇▇▇-▇▇▇ 1
83 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
84 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
85 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
86 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
87 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
88 PIT. ▇▇-▇▇▇▇▇-▇▇▇ 1
89 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
90 PLT. ▇▇-▇▇▇▇▇-▇▇▇ 1
▇-▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ A-2
TO
AIRCRAFT LEASE AGREEMENT
DOCUMENTS DELIVERED ON THE DELIVERY DATE
(LATEST REVISIONS)
1. Approved Flight Manual 1 paper
2. B737 Maintenance Manual microfilm
3. B737 Illustrated Parts Catalogue microfilm paper
4. B737 Wiring Diagram Manual 1 paper
5. B737 Weight & Balance Manual 1 paper
6. Current Weight Report 1 paper
7. APU Log Book 1 paper
8. Service Bulletin/
Accomplishment Record
9. Airworthiness Directive
Compliance Status
10. Rotable Component 1 set paper
History Cards
11. Rotable Time Control Data Run 2 paper
12. Engine Build Log - 2 per engine paper
Time Limited Items
13. Aircraft Maintenance Records 1 set paper
▇-▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ B
to
AIRCRAFT LEASE AGREEMENT
AIRCRAFT DOCUMENTS
A. CERTIFICATES
- FAA Certificate of Airworthiness
B. AIRCRAFT STATUS RECORDS
- Log Books
- Airframe Maintenance Status Report
- Supplemental Structural Inspection Document Status
(if applicable)
- Manufacturer's Service Bulletin Status Report
- Airworthiness Directive Compliance Report
(terminated and repetitive)
- Modification Status Report List
(documents will be provided upon request)
- Last Weighing Report
- List of Life Limited Components with remaining
hours/cycles
C. AIRCRAFT MAINTENANCE RECORDS (last heavy maintenance visits)
- Test Flight Reports
- X-ray pictures
- Last annual check and heaviest maintenance check Work
Cards
D. AIRCRAFT HISTORY RECORDS
- Aircraft Maintenance History Cards
- Service Difficulty Report
- Accident or Incident Report (Major Structural Repair)
E. ENGINE RECORDS (for each engine)
- Last overhaul and repair documents
- Airworthiness Directive Compliance Report
(terminated and repetitive)
- Manufacturer's Service Bulletin Status Report
B-1
PHC 90-047 WKH
- List of Time Controlled Components with remaining
hours and cycles
- Modification Status Report
- Engine Disc Sheets
- Engine Build Specifications
F. APU RECORDS
- Last Overhaul and Repair Documents
(including modification status)
- Airworthiness Directive Compliance Report
(terminated and repetitive)
- Manufacturer's Service Bulletin Status Report
- List of Time Controlled Components with remaining
hours/cycles
- Modification Status Report
G. COMPONENT RECORDS
- Time Controlled Component Status Report with Tags
H. MANUALS
- Airplane Flight Manual
(Manufacturer Approved, FAA Approved)
- Flight Crew Operating Manual
- Weight and Balance Manual
- Wiring Diagram Manual
(microfilm and hard copy if available)
- Illustrated Parts Catalog (microfilm)
- Aircraft Maintenance Manual (microfilm)
- Manufacturer's Engine Maintenance Manual and any
approved engineering changes, as applicable
I. MISCELLANEOUS TECHNICAL DOCUMENTS
- Maintenance Program Specifications
- Interior Configuration Drawings
- Original Delivery Documents
- Loose Equipment Inventory
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ C
to
AIRCRAFT LEASE AGREEMENT
DEFINITIONS AND VALUES
Additional Rent: The Additional Rent shall be in the
amount and payable throughout the Term
as specified in Letter Agreement No.
1 to this Lease Agreement.
Basic Rent: The Basic Rent shall be in the amount
and payable throughout the Term as
specified in Letter Agreement No. 1 to
this Lease Agreement.
Basic Rent Payment The Basic Rent Payment Date shall be
Date: as specified in Letter Agreement No.
1 to this Lease Agreement.
Casualty Value: Fifteen Million Dollars ($15,000,000)
Country of Organization: USA
Country of Registration: USA
Deductible Amount: Five Hundred Thousand Dollars ($500,000)
Interim Rent: The Interim Rent shall be in the amount
and payable as specified in Letter
Agreement No. 1 to this Lease
Agreement.
Interim Rent Payment The Interim Rent Payment Date shall be
Date: as specified in Letter Agreement No.
1 to this Lease Agreement.
Initial Term: The Initial Term shall commence on the
Delivery Date and expire July 31, 1997.
Delivery Location: Brunei International Airport, Brunei
Darussalem.
Engine Manufacturer: ▇▇▇▇▇ & ▇▇▇▇▇▇▇.
Estimated Delivery July 17, 1990
Date:
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ Rate: Citibank, N.A.'s prime rate plus three
percent (3%) per annum, but not to
exceed the maximum amount permitted by
Law.
Last Basic Rent The Last Basic Rent Payment Date for
Payment Date: the Aircraft shall be on July 31, 1997,
subject to extension as provided in
Section 3(f) of the Lease.
Lease Identification: "Leased from Polaris Holding Company,
as Owner and Lessor."
Lessee's Address: Aloha Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President - Finance
and Chief Financial Officer
Lessor's Address: Polaris Holding Company
Four ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Manufacturer: The Boeing Company
Payment Location: ▇▇▇▇▇ Fargo Bank N.A. for the account
of Polaris Holding Company, Account
No. 4001-199645, at San Francisco Main
Office, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ABA #1 21000248 with
sufficient information to identify the source
and application of payments made to
such account.
Public Liability and
Property Damage Insurance: Three Hundred Million Dollars
($300,000,000)
Return Location: Los Angeles International Airport or
such other location in the Western Continental
United States as may be designated in a notice
from Lessor to Lessee, or such other
location as may be mutually acceptable to
the parties.
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▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ D
to
AIRCRAFT LEASE AGREEMENT
LEASE SUPPLEMENT NO. ______
LEASE SUPPLE MENT NO.___, dated _________________________, 199__,
between Polaris Holding Company, a Delaware corporation (Lessor), and Aloha
Airlines, Inc., a corporation organized under the laws of the State of Hawaii
(Lessee).
Lessor and Lessee have previously entered into that certain
Aircraft
Lease Agreement dated as of July _ , 1990 (herein called the "Lease" and the
defined terms therein being hereinafter used with the same meaning). The Lease
provides for the execution and delivery from time to time of a Lease Supplement
substantially in the form hereof for the purpose of leasing the aircraft
described below under the Lease as and when delivered by Lessor to Lessee in
accordance with the terms thereof.
The Lease relates to the Aircraft, Parts and Engines as more precisely
described below. A counterpart of the Lease is attached hereto and this Lease
Supplement and the Lease shall form one document.
In consideration of the premises and other good and sufficient
consideration, Lessor and Lessee hereby agree as follows:
1. Lessor hereby delivers and leases to Lessee under the Lease and
Lessee hereby accepts and leases from Lessor under the Lease, that certain
Boeing 737-2M6C commercial jet aircraft, Airframe and the two ▇▇▇▇▇ & Whitney
JT8D-15 Engines (each of which Engines has 750 or more rated takeoff horsepower
or the equivalent of such horsepower) described in Schedule 1 herewith
(Delivered Aircraft).
2. The Delivery Date of the Delivered Aircraft is the date of this
Lease Supplement set forth in the opening paragraph hereof.
3. The Term for the Delivered Aircraft shall commence on the Delivery
Date and shall end on the Expiration Date, which shall be July 31, 1997,
subject to extension as provided in Section 3(f) of the Lease.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇. ▇▇▇▇▇▇ hereby confirms to Lessor that (i) within forty-eight (48)
hours of the Delivery Date, the Delivered Aircraft and each Engine installed
thereon or belonging thereto have been duly marked in accordance with the terms
of Section 6(f) of the Lease, (ii) Lessee has accepted the Delivered Aircraft
for all purposes hereof and of the Lease, and (iii) Lessee has inspected the
Delivered Aircraft and the Delivered Aircraft satisfies the conditions set
forth in the Lease.
5. All of the terms and provisions of the Lease Agreement are hereby
incorporated by reference in the Lease Supplement to the same extent as if
fully set forth herein.
6. The Lease Supplement may be executed in any number of counterparts,
each of such counterparts, except as provided in Section 20(e) of the Lease,
shall for all purposes be deemed to be an original; and all such counterparts
shall together constitute but one and the same Lease Supplement.
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease
Supplement No. 1 to be duly executed as of the day and year first above
written.
LESSOR,
POLARIS HOLDING COMPANY
By _______________________________________
Title:
LESSEE,
ALOHA AIRLINES, INC.
By _______________________________________
Title:
By _______________________________________
Title:
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ I
TO
LEASE SUPPLEMENT NO. _____
Boeing
Model 737-2M6C
AIRFRAME
FAA
Registration Manufacturer's
Number Serial No. Total Time* Total Cycles*
------------ -------------- ----------- -------------
N805AL 21809 ______________ _____________
Installed two
▇▇▇▇▇ & ▇▇▇▇▇▇▇ Engines
-----------------------
Model No. Serial No. Total Time* Total Cycles*
--------- ---------- ----------- -------------
JT8D-15 P702833B _______________ _____________
JT8D-15 P702835B _______________ _____________
Each of the above-described Aircraft Engines is 750 or more rated takeoff
horsepower or its equivalent.
*The total time and total cycles referred to above are as of ____________Time,
_______________, 1990. Such times and cycles are within hours and cycles of the
actual hours and cycles at the time of this Lease Supplement.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ E
to
AIRCRAFT LEASE AGREEMENT
RETURN CONDITION REQUIREMENTS
In addition to the requirements set forth in Section 16 of
the Lease, on or before the Expiration Date, Lessee, at its own expense, shall
return the Aircraft in compliance with all of the following provisions:
(1) The Aircraft shall have theretofore been maintained in
accordance with Section 6(d) of the Lease with the same care and consideration
for the technical condition of the Aircraft as if it were to have been kept in
continued regular service by Lessee.
(2) The Aircraft, in the reasonable opinion of Lessor, shall
be clean by domestic commercial airline standards. The cockpit shall be
repainted and placards replaced as required.
(3) The Aircraft shall have installed the full complement of
Engines (as used herein the term "Engines" includes engines for which title
will be transferred to Lessor pursuant to Section 16(c) of the Lease) and other
equipment, parts, components, accessories, and loose equipment as would remain
installed on the Aircraft were Lessee to continue operating the same in
continued regular passenger service, each such item functioning in accordance
with its intended use.
(4) The Aircraft shall comply with the Manufacturer's
original specifications therefor, as revised up to the date of return
hereunder.
(5) The Aircraft shall comply with all outstanding U.S.
Federal Aviation Regulations and Airworthiness Directives issued by the FAA
affecting such model aircraft which by their terms require compliance on or
before the expiration date of this Lease. All Airworthiness Directives
relating to fuselage structure shall be complied with by terminating action
if such action is authorized by the FAA.
(6) The Aircraft shall meet the requirements for
airworthiness certification by the FAA. Lessee will permanently repair any
damage to the Aircraft that exceeds FAA limits for operation without
restriction.
▇-▇
▇▇▇ ▇▇-▇▇▇ WKH
(7) The Aircraft, in the reasonable opinion of Lessor, shall
be in as good operating condition as when delivered to Lessee hereunder,
ordinary wear and tear excepted.
Those items in the interior of the Aircraft which are
determined by Lessor, in its reasonable opinion, to be defective shall be
replaced or repaired by Lessee.
(8) Lessee's distinctive markings, such as name and logo,
shall be removed from the Aircraft and such areas on the Aircraft shall be
repainted in a good quality white paint all in accordance with reasonable
standard industry practice so as to produce a uniform appearance. Lessee shall
prepare the Aircraft for such repainting by restoring aerodynamic sealer to
any area stripped of paint. Wing and tail surfaces normally painted will be so
retouched upon return of the Aircraft. All such painting is to be accomplished
with feathering and blending of chips and bare spots so as to result in a
uniformly smooth aerodynamic surface.
(9) The Aircraft shall be in compliance with Service
Bulletins issued at the time of return as accomplished on similarly configured
aircraft in Lessee's fleet performing like missions.
(10) Lessee shall adhere strictly to the corrosion prevention
and treatment cards as prescribed in the Maintenance Program.
(11) The Aircraft, except as otherwise provided in the Lease or
as consented to by Lessor, shall be in substantially the same configuration
(including, but not limited to, interior seating configuration, galleys and
lavatories) as when such Aircraft was originally delivered to Lessee hereunder.
(12) Neither the Aircraft nor any Engine shall have any open,
deferred or placarded log book items.
(13) At the end of the Term of the Lease, upon the written
request of Lessor, at Lessee's expense, Lessee shall apply for an Export
Certificate of Airworthiness for the Aircraft; provided, however, that Lessee
shall not be responsible for any cost or expense associated with overhauling or
modifying the Aircraft in order to obtain such Export Certificate.
(14) Upon return of the Aircraft, all "D" check (or its
equivalent) and structural inspection items on the Airframe shall have an
average of at least fifty percent (50%) of the allowable hours remaining until
the next scheduled "D" check (or its equivalent) in accordance with the
Maintenance Program, but in no event less than five thousand (5,000) hours so
remaining.
▇-▇
▇▇▇ ▇▇-▇▇▇ WKH
(15) A completed "C" Check (or its equivalent) shall have been
accomplished immediately prior to the Return Occasion in accordance with the
Maintenance Program, including such structural inspection in accordance with
the Boeing Structural Maintenance Planning document which are normally part of
the "C" Check with all deficiencies corrected.
(16) Immediately prior to the Return Occasion each Engine shall
have just completed a hot and cold section borescope in accordance with the
Maintenance Program or Engine Manufacturer's Maintenance Manual and any defects
discovered in such inspection, which exceed the Engine manufacturer's limits,
shall be corrected at Lessee's expense.
(17) No Engine shall be on "Watch" or have any non-transferable
time extensions and each such Engine shall comply with the operations
specification of Lessee without waiver or exceptions.
(18) Each time controlled component (whether controlled in
hours, cycles or by calendar) on the Aircraft, excluding the Engines, the APU
and the landing gear (but including any time controlled components thereon)
shall have remaining no less than fifty percent (50%) of its allowable time
remaining between scheduled overhauls or replacements. Lessee may remove and
replace any time controlled component in order to comply with return conditions
herein set forth; provided that the replacement component has an equivalent or
later part number, has a value, remaining warranty and modification status at
least equal to the replaced component and is completely interchangeable as to
form, fit and function and provided further that the replacement component has
at least an equal number of hours or calendar time remaining, as the case may
be, as the replaced component.
(19) The discs in each Engine shall have an average of fifty
percent (50%) of their allowable life remaining with no discs having less than
six thousand (6,000) hours or cycles (whichever is the more limiting factor)
remaining until the next restriction.
(20) Each landing gear shall have fifty percent (50%) of its
allowable time between overhauls or major shop visits remaining and no less
than twenty-five thousand (25,000) cycles of total life remaining.
(21) The auxiliary power unit (APU) of the Aircraft when
returned to Lessor shall be returned with not less than fifty percent (50%) of
the allowable time remaining until the next scheduled shop visit if the APU is
being maintained on a hard-time basis in accordance with Lessee's Maintenance
Program and in any event not more than six months shall have elapsed since the
last
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
shop visit. If Lessee's Maintenance Program provides for a borescope inspection
of the APU, such borescope inspection shall be accomplished immediately Prior
to return and any discrepancies found shall be corrected by Lessee.
▇-▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ F
to
AIRCRAFT LEASE AGREEMENT
LIST OF PERMITTED AIR CARRIERS
Aer Lingus
All Nippon Airways
Iberia
Malaysian Airlines System
Qantas
Sabena
TAP
Air-Inter
Air New Zealand
Air Canada
Ansett
Canadian Airlines International
Air France
Australian
Braathens
CAAC
Alitalia
British Airways
KLM
Lufthansa
SAS
Singapore Airlines
Swissair
JAL
Condor
Cathay Pacific
Japan Airline System
Austral
Austrian
British Midland
Thai
Holland
Martinair
Japan Asia Airways
China Airlines
Trans Brazil
Varig
VASP
Korean Airlines
F-1
PHC 90-047 WKH
LEASE SUPPLEMENT NO. 1
LEASE SUPPLEMENT NO. 1, dated July 16, 1990, between Polaris Holding
Company, a Delaware corporation (Lessor), and Aloha Airlines, Inc., a
corporation organized under the laws of the State of Hawaii (Lessee).
Lessor and Lessee have previously entered into that certain Aircraft
Lease Agreement dated as of July __ , 1990 (herein called the "Lease" and the
defined terms therein being hereinafter used with the same meaning). The
Lease provides for the execution and delivery from time to time of a Lease
Supplement substantially in the form hereof for the purpose of leasing the
aircraft described below under the Lease as and when delivered by Lessor to
Lessee in accordance with the terms thereof.
The Lease relates to the Aircraft, Parts and Engines as more precisely
described below. A counterpart of the Lease is attached hereto and this Lease
Supplement and the Lease shall form one document.
In consideration of the premises and other good and sufficient
consideration, Lessor and Lessee hereby agree as follows:
1. Lessor hereby delivers and leases to Lessee under the Lease and
Lessee hereby accepts and leases from Lessor under the Lease, that certain
Boeing 737-2M6C commercial jet aircraft, Airframe and the two ▇▇▇▇▇ &
▇▇▇▇▇▇▇ JT8D-15 Engines (each of which Engines has 750 or more rated takeoff
horsepower or the equivalent of such horsepower) described in Schedule 1
herewith (Delivered Aircraft).
2. The Delivery Date of the Delivered Aircraft is the date of this Lease
Supplement set forth in the opening paragraph hereof.
3. The Term for the Delivered Aircraft shall commence on the Delivery
Date and shall end on the Expiration Date, which shall be July 31, 1997,
subject to extension as provided in Section 3(f) of the Lease.
PHC 90-047 WKH
4. Lessee hereby confirms to Lessor that (i) within forty-eight (48)
hours of the Delivery Date, the Delivered Aircraft and each Engine installed
thereon or belonging thereto have been duly marked in accordance with the
terms of Section 6(f) of the Lease, (ii) Lessee has accepted the Delivered
Aircraft for all purposes hereof and of the Lease, and (iii) Lessee has
inspected the Delivered Aircraft and the Delivered Aircraft satisfies the
conditions set forth in the Lease.
5. All of the terms and provisions of the Lease Agreement are hereby
incorporated by reference in the Lease Supplement to the same extent as if
fully set forth herein.
6. The Lease Supplement may be executed in any number of counterparts,
each of such counterparts, except as provided in Section 20(e) of the Lease,
shall for all purposes be deemed to be an original; and all such counterparts
shall together constitute but one and the same Lease Supplement.
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease Supplement
No. 1 to be duly executed as of the day and year first above written.
LESSOR,
POLARIS HOLDING COMPANY
By [Illegible]
----------------------------------------------
Title: Vice President; Associate General Counsel
LESSEE,
ALOHA AIRLINES, INC.
By
----------------------------------------------
Title:
By
----------------------------------------------
Title:
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇. ▇▇▇▇▇▇ hereby confirms to Lessor that (i) within forty-eight (48)
hours of the Delivery Date, the Delivered Aircraft and each Engine installed
thereon or belonging thereto have been duly marked in accordance with the
terms of Section 6(f) of the Lease, (ii) Lessee has accepted the Delivered
Aircraft for all purposes hereof and of the Lease, and (iii) Lessee has
inspected the Delivered Aircraft and the Delivered Aircraft satisfies the
conditions set forth in the Lease.
5. All of the terms and provisions of the Lease Agreement are hereby
incorporated by reference in the Lease Supplement to the same extent as if
fully set forth herein.
6. The Lease Supplement may be executed in any number of counterparts,
each of such counterparts, except as provided in Section 20(e) of the Lease,
shall for all purposes be deemed to be an original; and all such counterparts
shall together constitute but one and the same Lease Supplement.
IN WITNESS WHEREOF, Lessor and Lessee have caused this Lease Supplement
No. 1 to be duly executed as of the day and year first above written.
LESSOR,
POLARIS HOLDING COMPANY
By
----------------------------------------------
Title:
LESSEE,
ALOHA AIRLINES, INC.
By [Illegible]
----------------------------------------------
Title: Senior Vice-President, Finance and
Chief Financial Officer
By [Illegible]
----------------------------------------------
Title: Senior Vice-President, Operations
SCHEDULE 1
TO
LEASE SUPPLEMENT NO. 1
----------------------
BOEING
MODEL 737-2M6C
AIRFRAME
--------------
FAA
Registration Manufacturer's
Number Serial No. Total Time* Total Cycles*
------------ -------------- ----------- -------------
NT805AL 21809 22,783.39 13,055
Installed Two
▇▇▇▇▇ & Whitney Engines
---------------------------
Model No. Serial No. Total Time* Total Cycles*
------------ -------------- ----------- -------------
JT8D-15 P702833B 16,679.22 10,438
JT8D-15 P702835B 17,973.14 10,251
Each of the above-described Aircraft Engines is 750 or more rated takeoff
horsepower or its equivalent.
* The total time and total cycles referred to above are as of 8:00 p.m.
Brunei Time, July 12, 1990. Such times and cycles are within 1 hour and 1
cycle of the actual hours and cycles at the time of this Lease Supplement.
Letter Agreement ▇▇. ▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇ Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Simultaneously herewith Aloha Airlines, Inc. (Lessee) and
Polaris Holding Company Lessor) have entered into that certain
Aircraft Lease Agreement No. PHC 90-047 WKH. Lessee and Lessor
agree that this Letter Agreement No. 1 shall constitute a part of said
Lease Agreement.
For all purposes of this Letter Agreement, except as otherwise expressly
defined herein or unless the context otherwise requires, capitalized terms
shall have the meanings specified in the Lease Agreement.
This Letter Agreement sets forth the Additional Rent, Basic Rent, Basic
Rent Payment Date, Interim Rent and Interim Rent Payment Date under the Lease
Agreement.
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
Interim Rent
Payment Date: August 1, 1990
LESSOR:
POLARIS HOLDING COMPANY
By: [illegible]
-----------------------------------
Title: Vice President, Associate
General Counsel
Date: July 16, 1990
LESSEE:
ALOHA AIRLINES, INC.
By:
-----------------------------------
Title:
-------------------------------
Date:
--------------------------------
By:
-----------------------------------
Title:
-------------------------------
Date:
--------------------------------
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
Interim Rent
Payment Date: August 1, 1990
LESSOR:
POLARIS HOLDING COMPANY
By:
-----------------------------------
Name:
Title:
LESSEE,
ALOHA AIRLINES, INC.
By: [ILLEGIBLE]
-----------------------------------
Title: Senior Vice-President, Finance
and Chief Financial Officer
Date: July 16, 1990
By: [ILLEGIBLE]
-----------------------------------
Title: Senior Vice-President, Operations
Date: July 16, 1990
Letter Agreement ▇▇. ▇
▇▇▇ ▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇ Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇
Simultaneously herewith Aloha Airlines, Inc. (Lessee) and Polaris
Holding Company (Lessor) have entered into that certain Aircraft Lease
Agreement No. PHC 90-047 WKH. Lessee and Lessor agree that this Letter
Agreement No. 2 shall constitute a part of said Lease Agreement.
For all purposes of this Letter Agreement, except as otherwise expressly
defined herein or unless the context otherwise requires, capitalized terms
shall have the meanings specified in the Lease Agreement.
This Letter Agreement sets forth the agreement between Lessor and Lessee
relating to the payment to be made by Lessee on the expiration of the Initial
Term, should Lessee not exercise the option to renew under the Lease, to
compensate Lessor for the decrease in residual value of the Aircraft due to
Lessee's high cycle utilization of the Aircraft during the Initial Term or, in
lieu of such payment, the agreement by Lessee to purchase the Aircraft.
Lessee agrees to pay the difference between the actual fair market sales
value of the Aircraft on the expiration of the Initial Term should Lessee not
exercise the option to renew under the Lease ("FMV") and the adjusted fair
market sales value ("AFMV") of the Aircraft on such Date which AFMV is based on
the assumption the Aircraft had been operated in the continental United States
at an average of 3000 cycles per year over the Initial Term of the Lease.
Lessee's obligation to pay the difference between FMV and AFMV shall not exceed
the amount of one Million Two Hundred and Fifty Thousand Dollars ($1,250,000).
The amount to be paid by Lessee shall be reduced by an amount of up to Six
Hundred Thousand Dollars ($600,000) of Additional Rent, which amount includes,
accrued interest on Additional Rent during the Initial Term. The procedure to
establish the amount to be paid by Lessee is as follows:
Lessor shall select an independent aircraft appraiser to determine the
difference between FMV and AFMV. Lessor shall bear the fees and expenses
of such appraiser. Should Lessee disagree with the amount determined by
said appraiser, Lessee, within ten (10) days of receipt of the appraiser's
report, shall select another independent
aircraft appraiser to deliver a report within twenty (20) days of such
appraiser's appointment apprising Lessor and Lessee of the amount said
appraiser is of the opinion that Lessee should pay (if Lessee fails to
appoint the appraiser, or the appraiser fails to deliver the report within
the time required hereunder, the determination of the appraiser appointed
by Lessor shall be determinative). Lessee shall bear the fees and expenses
of the second appraiser.
Should the amount to be paid by Lessee as determined by each of the two
appraisers differ by no more than five percent (5%), the average of the
two amounts shall be deemed determinative and shall be paid by Lessee to
Lessor within ten (10) days of the delivery of the report of the appraiser
appointed by Lessee.
Should the difference between the amounts determined by the appraisers be
greater than five percent (5%), the two appraisers shall within ten (10)
days of the delivery of the report of the appraiser appointed by Lessee
choose a third appraiser, who shall deliver a report within twenty (20)
days of appointment, and whose determination as to the amount to be paid by
Lessee shall be determinative, and Lessee shall pay such amount within ten
(10) days of the delivery of the third appraisers report. Lessee and Lessor
shall share equally the fees and expenses of the third appraiser.
Should the first two appraisers fail to appoint a third appraiser if one is
required by the procedure described above, the third appraiser shall be
appointed by the American Arbitration Association, and Lessee and Lessor
shall share equally the fees and expenses of the appraiser so chosen.
The appraisal procedure described above shall be commenced no less than
ninety (90) days prior to the expiration of the Initial Term. In
determining the FMV and AFMV, any appraisal shall assume that the Aircraft
is unencumbered by the Lease, has been maintained in accordance with the
terms of the Lease (whether or not it is in fact in such condition), and
has a value which, would be obtained in an arms-length transaction between
an informed and willing seller and an informed and willing buyer, both
under no compulsion to sell or buy.
In lieu of paying the difference between the AFMV and the FMV as determined
by the above appraisal procedure, Lessee may, by giving Lessor written notice
either ninety-five (95) days prior to
the expiration of the Initial Term or immediately upon completion of the
appraisal procedure described above, purchase the Aircraft at the end of the
Initial Term of the Lease for a purchase price ("Aircraft Purchase Price")
equal to the AFMV determined by the appraiser appointed by Lessor. Should
Lessee so notify Lessor in writing of its intent to purchase the Aircraft, and
the AFMV at the end of the Initial Term of the Lease is less than Twelve
Million Eight Hundred and Eighty Thousand Dollars ($12,880,000), Lessor shall
have the option to require Lessee to purchase the Aircraft for the amount of
Twelve Million Eight Hundred and Eighty Thousand Dollars ($12,880,000). The
Aircraft will be sold by Lessor to Lessee "as is" "where is", and the sale
documentation shall be prepared by Lessor, governed by and enforceable under
the laws of the State of California, and include disclaimers of warranty,
indemnities, and other provisions standard in Lessor's documents and in the
industry. The Lease Term shall continue until the Aircraft has been delivered
by Lessor to Lessee under the sale documentation and the obligation to pay Rent
under the Lease shall be continued on a daily basis until said delivery occurs.
It is agreed that should the Airframe sustain a Casualty Occurrence during
the Term, then upon receipt by Lessor of the payments under Section 11(a) of
the Lease, Lessor shall pay to Lessee an amount equal to the Additional Rent
without interest paid by Lessee to Lessor up to the date Lessor receives all
payments owing.
LESSOR:
POLAR HOLDING COMPANY
By: [illegible]
-----------------------------------
Title: Vice President, Associate
General Counsel
Date: July 16,1990
LESSEE:
ALOHA AIRLINES, INC.
By: ___________________________
Title:
Date:
By: ___________________________
Title:
Date:
the expiration of the Initial Term or immediately upon completion of the
appraisal procedure described above, purchase the Aircraft at the end of the
Initial Term of the Lease for a purchase price ("Aircraft Purchase Price")
equal to the AFMV determined by the appraiser appointed by Lessor. Should
Lessee so notify Lessor in writing of its intent to purchase the Aircraft, and
the AFMV at the end of the Initial Term of the Lease is less than Twelve
Million Eight Hundred and Eighty Thousand Dollars ($12,880,000), Lessor shall
have the option to require Lessee to purchase the Aircraft for the amount of
Twelve Million Eight Hundred and Eighty Thousand Dollars ($12,880,000). The
Aircraft will be sold by Lessor to Lessee "as is" "where is", and the sale
documentation shall be prepared by Lessor, governed by and enforceable under
the laws of the State of California, and include disclaimers of warranty,
indemnities, and other provisions standard in Lessor's documents and in the
industry. The Lease Term shall continue until the Aircraft has been delivered
by Lessor to Lessee under the sale documentation and the obligation to pay Rent
under the Lease shall be continued on a daily basis until said delivery occurs.
It is agreed that should the Airframe sustain a Casualty Occurrence during
the Term, then upon receipt by Lessor of the payments under Section 11(a) of
the Lease, Lessor shall pay to Lessee an amount equal to the Additional Rent
without interest paid by Lessee to Lessor up to the date Lessor receives all
payments owing.
LESSOR:
POLARIS HOLDING COMPANY
By: _____________________________________
Title:
Date:
LESSEE:
ALOHA AIRLINES, INC.
By: [illegible]
-------------------------------
Title: Senior Vice-president Finance
and Chief Financial officer
Date: July 16, 1990
By: [illegible]
------------------------------
Title: Senior Vice-President, Operations
Date: July 16, 1990
ASSIGNMENT, ASSUMPTION, AMENDMENT AND CONSENT
---------------------------------------------
THIS ASSIGNMENT, ASSUMPTION, AMENDMENT AND CONSENT ("Assignment and
Amendment"), dated as of December 26, 1996 is between POLARIS HOLDING COMPANY
("Lessor"), ALOHA AIRLINES, INC., a Hawaii Corporation ("Assignor"), and ALOHA
AIRLINES, INC., a Delaware corporation ("Assignee").
RECITALS
--------
WHEREAS, Lessor and Assignor entered into that certain Aircraft
Lease Agreement dated as of July 17, 1990, as supplemented by that Lease
Supplement No. 1 dated as of July 17, 1990 and recorded by the Federal Aviation
Administration ("FAA") on July 17, 1990 as Conveyance No. S89046 and as amended
by that Amendment No. 1 (Lease Extension) dated as of January 31, 1997 and
recorded by the FAA on March 10, 1997 as Conveyance No. XX007783 (the "Lease"),
pursuant to which Assignor leased from Lessor one (1) Boeing model 737-2M6C
aircraft bearing manufacturer's serial number 21809 and registration ▇▇▇▇
N805AL (the "Aircraft"); and
WHEREAS, effective December 26, 1996 at 9:00 a.m. Central Standard
Time, Assignor merged with Assignee, and Assignee emerged as the surviving
entity and the successor in interest to Lessee;
AGREEMENT
---------
NOW, THEREFORE, in consideration of these presents and for other
valuable consideration, the parties agree as follows:
1. CERTAIN DEFINED TERMS. Unless otherwise defined herein or the
context otherwise requires, all capitalized terms used in this Assignment and
Amendment shall have the respective meanings assigned to them in the Lease.
2. ASSIGNMENT. As of December 26, 1996 (the "Effective Date"), the
Assignor hereby sells, assigns, transfers and conveys to Assignee all of the
Assignor's right, title and interest in and to the Lease, as if Assignee were
the original party to the Lease.
3. ASSUMPTION BY ASSIGNEE. Assignee hereby accepts the foregoing
sale, assignment, transfer and conveyance of all of the Assignor's right,
title, interest, obligations and liabilities in, to and under the Lease to the
Assignee and, as of the Effective Date, agrees to assume and to be bound by all
the terms of, and to undertake all of the obligations of the Assignor contained
in, the Lease, including without limitation, all such obligations existing at
or prior to, or attributable to acts or events occurring prior to the Effective
Date.
RECORDED
Federal Aviation Administration
Date 2/3/98 Time 3:42 PM
------ -------
Conveyance Number II010398
---------
/s/ [ILLEGIBLE]
4. LESSOR CONSENT.
(a) Pursuant to Section 6(a)(i) of the Lease, Lessor
acknowledges and consents to the foregoing sale, assignment, transfer and
conveyance of all of the Assignor's right, title, interest, obligations and
liabilities in, to and under the Lease to the Assignee under this Assignment
and Amendment, and acknowledges the rights and obligations of the Assignee
described in this Assignment and Amendment.
(b) Lessor further acknowledges and agrees that from and
after the Effective Date Assignee shall be deemed the "Lessee" for all purposes
of the Lease and each reference in the Lease to the Assignor as "Lessee" shall
be deemed after the Effective Date for all purposes to refer to the Assignee
and that, from and after the Effective Date Lessor will perform its obligations
under the Lease, in all respects as if Assignee were the original party to the
Lease as "Lessee" thereunder.
5. AMENDMENT OF SECTION 5(c).
Assignee, as Lessee, hereby makes the following representations and
warranties as of the date of this Assignment and Amendment, and, from and after
the Effective Date, such representations and warranties shall be deemed
incorporated into the Lease, and made a part thereof, as a substitute for and
in lieu of the representations set forth in Section 5(c) of the Lease:
(c) Lessee's Representations and Warranties. Lessee hereby makes
the following representations and warranties, which representations and
warranties shall survive the execution and delivery of the Lease and the
Assignment and Amendment:
(i) Lessee is a corporation duly organized, and existing in
good standing under the Laws of the State of Delaware, and has the corporate
power and authority to carry on its business as presently conducted and to
perform its obligations under the Lease and the Assignment and Amendment;
(ii) the Lease and the Assignment and Amendment have been
duly authorized by all necessary corporate action on the part of Lessee, does
not require any approval of stockholders of Lessee (or if such approval is
required, such approval has been obtained), and neither the execution and
delivery of the Assignment and Amendment nor the consummation of the
transactions contemplated by the Lease and the Assignment and Amendment nor
compliance by Lessee with any of the terms and provisions of the Lease and the
Assignment and Amendment will contravene any Law applicable to Lessee or result
in any breach of, or constitute any default under, or result in the creation of
any lien, charge or encumbrance upon any property of Lessee under, any credit
2
agreement or instrument, corporate charter or by-law or other agreement or
instrument to which Lessee is a party or by which Lessee or its properties or
assets are bound or affected;
(iii) Lessee has received every consent, approval or
authorization of, and has given every notice to, each Governmental Entity
having jurisdiction with respect to the execution, delivery, or performance of
the Lease and the Assignment and Amendment (including all monetary and other
obligations hereunder) that is required for Lessee to execute and deliver the
Assignment and Amendment, and to perform the transactions contemplated by the
Lease and the Assignment and Amendment;
(iv) the Assignment and Amendment has been duly executed and
delivered by Lessee, and the Lease and the Assignment and Amendment constitute
legal, valid and binding obligations of the Lessee, enforceable in accordance
with their respective terms, except as enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, and, by general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law) as a court having such remedies but which
do not make available remedies inadequate for the substantial realization of
the benefits provided herein;
(v) there are no suits or proceedings pending or, to the
knowledge of Lessee, threatened in any court or before any regulatory
commission, board or other administrative governmental agency against or
affecting Lessee which will have a materially adverse effect on the current
business or financial condition of Lessee;
(vi) Lessee has filed or caused to be filed all material tax
returns which are required to be filed by it, and has paid or caused to be paid
all taxes shown to be due or payable on said returns or on any assessment
received by Lessee, unless protected by appropriate proceedings;
(vii) except for the filing for recordation of the Lease, the
Certificate of Merger (a copy of which is attached hereto), and the Assignment
and Amendment with the FAA, and the placing on the Aircraft and on each Engine
of the plates containing the legends referred to in Section 6(f) hereof, no
further filing or recording of the Lease, Certificate of Merger, and the
Assignment and Amendment or of any other document and no further action, is
necessary or desirable under the Laws of any governmental Entity in order to
(A) fully protect and establish Lessor's title to, interest in and property
rights with respect to, the Aircraft as against Lessee or any third party and
to ensure that the property rights of Lessor therein will have
3
priority in all respects over the claims of all creditors of Lessee, or (B)
ensure the validity, effectiveness and enforceability of the Lease and the
Assignment and Amendment;
(viii) Lessee is not in default in the performance of any of
its obligations (a) for the payment of indebtedness for borrowed money in a
principal amount in excess of Five Hundred Thousand Dollars ($500,000) or of
any interest or premium thereon or (b) for the payment of rent under any lease
or agreement to lease real, personal or mixed property where the aggregate
rentals over the term thereof is more than Three Hundred Fifty Thousand Dollars
($350,000);
(ix) the Maintenance Program will comply with all FAA
requirements;
(x) the consolidated financial statements of Lessee and the
Guarantor, including the balance sheets and audited statements of income and
retained earnings of Lessee and the Guarantor, for the preceding two fiscal
years, copies of which have been furnished to Lessor, are prepared in
accordance with generally accepted accounting principles, and present fairly
the financial position and operations of Lessee and the Guarantor, and
subsequent to the conclusion of the last such period, there has been no
material adverse change in such position or operations (except changes
resulting from Lessee's fleet standardization in late 1995 in which Lessor
participated);
(xi) there is no withholding or other tax to be deducted from
any payment to be made by Lessee under this Lease;
(xii) the choice of California law and United States federal
law to govern the Lease and the Assignment and Amendment is a valid choice of
law; and
(xiii) Lessor shall be entitled to the benefits of a lessor
under Title 11 U.S.C. Section 1110 as in effect on the date hereof, and, as a
consequence, any right of Lessor to take possession of such Aircraft in
compliance with the provisions of this Lease Agreement shall not be affected by
the provisions of Section 362 or 363 of such Title as in effect on the date
hereof.
6. This Assignment and Amendment shall be governed by the laws of
the State of California.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
4
IN WITNESS WHEREOF, the undersigned parties have caused this
Assignment, Assumption, Amendment and Consent to be duly executed and
delivered by their duly authorized officers as of the date first written above.
ASSIGNOR: ALOHA AIRLINES, INC., A HAWAII
CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: SR. VICE PRESIDENT & PLANNING
AND CFO
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: VICE PRESIDENT PLANNING &
DEVELOPMENT
ASSIGNEE: ALOHA AIRLINES, INC., A DELAWARE
CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: SR. VICE PRESIDENT & PLANNING
AND CFO
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: VICE PRESIDENT PLANNING &
DEVELOPMENT
LESSOR: POLARIS HOLDING COMPANY
By:
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
5
IN WITNESS WHEREOF, the undersigned parties have caused this
Assignment, Assumption, Amendment and Consent to be duly executed and delivered
by their duly authorized officers as of the date first written above.
ASSIGNOR: ALOHA AIRLINES, INC., A HAWAII
CORPORATION
By: /s/ authorized signatory
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
By: /s/ authorized signatory
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
ASSIGNEE: ALOHA AIRLINES, INC., A DELAWARE
CORPORATION
By: /s/ authorized signatory
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
By: /s/ authorized signatory
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
LESSOR: POLARIS HOLDING COMPANY
By: /s/ Marc. A Meiches
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
5
CERTIFICATE OF MERGER
MERGING
ALOHA AIRLINES INC.
a Hawaii Corporation
WITH AND INTO
ALOHA AIRLINES, INC.
a Delaware corporation
Aloha Airlines, Inc., a Hawaii corporation ("Aloha Hawaii"),
and Aloha Airlines, Inc., a Delaware corporation (the "Company"), DO HEREBY
CERTIFY AS FOLLOWS:
FIRST: That Aloha Hawaii was originally incorporated under the
Laws of the State of Hawaii and that the Company was originally incorporated
under the General Corporation Law of the State of Delaware (the "Delaware
Law").
SECOND: That an Agreement and Plan of Merger dated as of
December 1996 (the "Merger Agreement") between Aloha Hawaii and the Company
has been approved, adopted, certified, executed and acknowledged by each of
Aloha Hawaii and the Company in accordance with the Hawaii Business
Corporation Act, Chapter 415 of the Hawaii Revised Statutes, as amended
and Section 252 of the Delaware Law.
THIRD: That the name of the surviving corporation (the
"Surviving Corporation") shall be Aloha Airlines, Inc.
FOURTH: That the Certificate of Incorporation of the Company,
which was filed on November 25, 1996, shall be the Certificate of
Incorporation of the Surviving Corporation.
FIFTH: That an executed copy of the Merger Agreement is on file
at the principal place of business of the Surviving Corporation at the
following address:
Aloha Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SIXTH: That a copy of the Merger Agreement will be furnished by
the
EXHIBIT "A"
2
Surviving Corporation, on request, and without cost, to any stockholder of
Aloha Hawaii or the Company.
IN WITNESS WHEREOF, Aloha Hawaii has caused this Certificate of
Merger to be signed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, its President and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
its Senior Vice President Finance and Planning, and the Company has caused
this Certificate of Merger to be signed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, its President and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, its Senior Vice President Finance and Planning, each as
of this 5th day of December 1996.
ALOHA AIRLINES, INC.,
a Hawaii corporation
By /s/ ▇. ▇. ▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President
Finance and Planning
ALOHA AIRLINES, INC.,
a Delaware corporation
By /s/ ▇. ▇. ▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President
Finance and Planning
ASSIGNMENT, ASSUMPTION, AMENDMENT AND CONSENT
---------------------------------------------
THIS ASSIGNMENT, ASSUMPTION, AMENDMENT AND CONSENT ("Assignment and
Amendment"), dated as of December 26, 1996 is between POLARIS HOLDING COMPANY
("Lessor"), ALOHA AIRLINES, INC., a Hawaii corporation ("Assignor"), and ALOHA
AIRLINES, INC., a Delaware corporation ("Assignee").
RECITALS
--------
WHEREAS, Lessor and Assignor entered into that certain Aircraft
Lease Agreement dated as of July 17, 1990, as supplemented by that Lease
Supplement No. 1 dated as of July 17, 1990 and recorded by the Federal Aviation
Administration ("FAA") on July 17, 1990 as Conveyance No. S89046 and as amended
by that Amendment No. 1 (Lease Extension) dated as of January 31, 1997 and
recorded by the FAA on March 10, 1997 as Conveyance No. XX007783 (the
"Lease"), pursuant to which Assignor leased from Lessor one (1) Boeing model
737-2M6C aircraft bearing manufacturer's serial number 21809 and registration
▇▇▇▇ N805AL (the "Aircraft"); and
WHEREAS, effective December 26, 1996 at 9:00 a.m. Central Standard
Time, Assignor merged with Assignee, and Assignee emerged as the surviving
entity and the successor in interest to Lessee;
AGREEMENT
---------
NOW, THEREFORE, in consideration of these presents and for other
valuable consideration, the parties agree as follows:
1. CERTAIN DEFINED TERMS. Unless otherwise defined herein or the
context otherwise requires, all capitalized terms used in this Assignment and
Amendment shall have the respective meanings assigned to them in the Lease.
2. ASSIGNMENT. As of December 26, 1996 (the "Effective Date"), the
Assignor hereby sells, assigns, transfers and conveys to Assignee all of the
Assignor's right, title and interest in and to the Lease, as if Assignee were
the original party to the Lease.
3. ASSUMPTION BY ASSIGNEE. Assignee hereby accepts the foregoing
sale, assignment, transfer and conveyance of all of the Assignor's right,
title, interest, obligations and liabilities in, to and under the Lease to the
Assignee and, as of the Effective Date, agrees to assume and to be bound by all
the terms of, and to undertake all of the obligations of the Assignor contained
in, the Lease, including without limitation, all such obligations existing at
or prior to, or attributable to acts or events occurring prior to the Effective
Date.
4. LESSOR CONSENT.
(a) Pursuant to Section 6(a)(i) of the Lease, Lessor
acknowledges and consents to the foregoing sale, assignment, transfer and
conveyance of all of the Assignor's right, title, interest, obligations and
liabilities in, to and under the Lease to the Assignee under this Assignment
and Amendment, and acknowledges the rights and obligations of the Assignee
described in this Assignment and Amendment.
(b) Lessor further acknowledges and agrees that from and
after the Effective Date Assignee shall be deemed the "Lessee" for all purposes
of the Lease and each reference in the Lease to the Assignor as "Lessee" shall
be deemed after the Effective Date for all purposes to refer to the Assignee
and that, from and after the Effective Date Lessor will perform its obligations
under the Lease, in all respects as if Assignee were the original party to the
Lease as "Lessee" thereunder.
5. AMENDMENT OF SECTION 5(c).
Assignee, as Lessee, hereby makes the following representations and
warranties as of the date of this Assignment and Amendment, and, from and after
the Effective Date, such representations and warranties shall be deemed
incorporated into the Lease, and made a part thereof, as a substitute for and
in lieu of the representations set forth in Section 5(c) of the Lease:
(c) Lessee's Representations and Warranties. Lessee hereby makes
the following representations and warranties, which representations and
warranties shall survive the execution and delivery of the Lease and the
Assignment and Amendment:
(i) Lessee is a corporation duly organized, and existing in
good standing under the Laws of the State of Delaware, and has the corporate
power and authority to carry on its business as presently conducted and to
perform its obligations under the Lease and the Assignment and Amendment;
(ii) the Lease and the Assignment and Amendment have been
duly authorized by all necessary corporate action on the part of Lessee, does
not require any approval of stockholders of Lessee (or if such approval is
required, such approval has been obtained), and neither the execution and
delivery of the Assignment and Amendment nor the consummation of the
transactions contemplated by the Lease and the Assignment and Amendment nor
compliance by Lessee with any of the terms and provisions of the Lease and the
Assignment and Amendment will contravene any Law applicable to Lessee or result
in any breach of, or constitute any default under, or result in the creation of
any lien, charge or encumbrance upon any property of Lessee under, any credit
2
agreement or instrument, corporate charter or by-law or other agreement or
instrument to which Lessee is a party or by which Lessee or its properties or
assets are bound or affected;
(iii) Lessee has received every consent, approval or
authorization of, and has given every notice to, each Governmental Entity
having jurisdiction with respect to the execution, delivery, or performance of
the Lease and the Assignment and Amendment (including all monetary and other
obligations hereunder) that is required for Lessee to execute and deliver the
Assignment and Amendment, and to perform the transactions contemplated by the
Lease and the Assignment and Amendment;
(iv) the Assignment and Amendment has been duly executed and
delivered by Lessee, and the Lease and the Assignment and Amendment constitute
legal, valid and binding obligations of the Lessee, enforceable in accordance
with their respective terms, except as enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights generally, and, by general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law) as a court having such remedies but which
do not make available remedies inadequate for the substantial realization of
the benefits provided herein;
(v) there are no suits or proceedings pending or, to the
knowledge of Lessee, threatened in any court or before any regulatory
commission, board or other administrative governmental agency against or
affecting Lessee which will have a materially adverse effect on the current
business or financial condition of Lessee;
(vi) Lessee has filed or caused to be filed all material tax
returns which are required to be filed by it, and has paid or caused to be paid
all taxes shown to be due or payable on said returns or on any assessment
received by Lessee, unless Protected by appropriate proceedings;
(vii) except for the filing for recordation of the Lease, the
Certificate of Merger (a copy of which is attached hereto), and the Assignment
and Amendment with the FAA, and the placing on the Aircraft and on each Engine
of the plates containing the legends referred to in Section 6(f) hereof, no
further filing or recording of the Lease, Certificate of Merger, and the
Assignment and Amendment or of any other document and no further action, is
necessary or desirable under the Laws of any governmental Entity in order to
(A) fully protect and establish Lessor's title to, interest in and property
rights with respect to, the Aircraft as against Lessee or any third party and
to ensure that the property rights of Lessor therein will have
3
priority in all respects over the claims of all creditors of Lessee, or (B)
ensure the validity, effectiveness and enforceability of the Lease and the
Assignment and Amendment;
(viii) Lessee is not in default in the performance of any of
its obligations (a) for the payment of indebtedness for borrowed money in a
principal amount in excess of Five Hundred Thousand Dollars ($500,000) or of
any interest or premium thereon or (b) for the payment of rent under any lease
or agreement to lease real, personal or mixed property where the aggregate
rentals over the term thereof is more than Three Hundred Fifty Thousand Dollars
($350,000);
(ix) the Maintenance Program will comply with all FAA
requirements;
(x) the consolidated financial statements of Lessee and the
Guarantor, including the balance sheets and audited statements of income and
retained earnings of Lessee and the Guarantor, for the preceding two fiscal
years, copies of which have been furnished to Lessor, are prepared in
accordance with generally accepted accounting principles, and present fairly
the financial position and operations of Lessee and the Guarantor, and
subsequent to the conclusion of the last such period, there has been no
material adverse change in such position or operations (except changes
resulting from Lessee's fleet standardization in late 1995 in which Lessor
participated);
(xi) there is no withholding or other tax to be deducted from
any payment to be made by Lessee under this Lease;
(xii) the choice of California law and United States federal
law to govern the Lease and the Assignment and Amendment is a valid choice of
law; and
(xiii) Lessor shall be entitled to the benefits of a lessor
under Title 11 U.S.C. Section 1110 as in effect on the date hereof, and, as a
consequence, any right of Lessor to take possession of such Aircraft in
compliance with the provisions of this Lease Agreement shall not be affected by
the provisions of Section 362 or 363 of such Title as in effect on the date
hereof.
6. This Assignment and Amendment shall be governed by the laws of
the State of California.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
4
IN WITNESS WHEREOF, the undersigned parties have caused this
Assignment, Assumption, Amendment and Consent to be duly executed and delivered
by their duly authorized officers as of the date first written above.
ASSIGNOR: ALOHA AIRLINES, INC., A HAWAII
CORPORATION
By:
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
By:
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
ASSIGNEE: ALOHA AIRLINES, INC., A DELAWARE
CORPORATION
By:
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
By:
-----------------------------------
Name:
--------------------------------
Title:
-------------------------------
LESSOR: POLARIS HOLDING COMPANY
By: /s/ Marc. A Meiches
-----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
5
CERTIFICATE OF MERGER
MERGING
ALOHA AIRLINES INC.,
a Hawaii Corporation
WITH AND INTO
ALOHA AIRLINES, INC.,
a Delaware corporation
Aloha Airlines, Inc., a Hawaii corporation ("Aloha Hawaii"),
and Aloha Airlines, Inc., a Delaware corporation (the "Company"), DO HEREBY
CERTIFY AS FOLLOWS:
FIRST: That Aloha Hawaii was originally incorporated under the
Laws of the State of Hawaii and that the Company was originally incorporated
under the General Corporation Law of the State of Delaware (the "Delaware
Law").
SECOND: That an Agreement and Plan of Merger dated as of
December 1996 (the "Merger Agreement") between Aloha Hawaii and the Company
has beta approved adopted, certified, executed and ACKNOWLEDGED by each of
Aloha Hawaii and the Company in accordance with the Hawaii Business
Corporation Act, Chapter 415 of the Hawaii Revised Statutes, as amended
and Section 252 of the Delaware Law.
THIRD: That the name of the surviving corporation (the
"Surviving Corporation") shall be Aloha Airlines, Inc.
FOURTH: That the Certificate of Incorporation of the Company,
which was filed an November 25, 1996, shall be the Certificate of
Incorporation of the Surviving Corporation.
FIFTH: That an executed copy of the Merger Agreement is on file
at the principal place of business of the Surviving Corporation at the
following address:
Aloha Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SIXTH: That a copy of the Merger Agreement will be furnished by
the
EXHIBIT "A"
2
Surviving Corporation, on request, and without cost, to any stockholder of
Aloha Hawaii or the Company.
IN WITNESS WHEREOF, Aloha Hawaii has caused this Certificate of
Merger to be signed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, its President and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
its Senior Vice President Finance and Planning, and the Company has caused
this Certificate of Merger to be signed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, its President and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, its Senior Vice President Finance and Planning, each as
of this 5th day of December 1996.
ALOHA AIRLINES, INC.,
a Hawaii corporation
By /s/ ▇. ▇. ▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President
Finance and Planning
ALOHA AIRLINES, INC.,
a Delaware corporation
By /s/ ▇. ▇. ▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President
Finance and Planning
CONSENT
-------
THIS CONSENT is made this 26th day of December, 1996 by Polaris
Holding Company ("Lessor") in favor of Aloha Airlines, Inc., a Hawaii
corporation ("Aloha Hawaii") and Aloha Airlines, Inc., a Delaware corporation
("Aloha Delaware").
RECITALS
--------
WHEREAS, Lessor and Aloha Hawaii entered into that certain Aircraft
Lease Agreement dated as of June 16, 1990 (the "Lease"), pursuant to which
Aloha Hawaii leased from Lessor one (1) Boeing model 737-2M6C aircraft bearing
manufacturer's serial number 21809 and registration ▇▇▇▇ N805AL (the
"Aircraft"); and
WHEREAS, Aloha Hawaii and Aloha Delaware are wholly owned
subsidiaries of Aloha Airgroup, Inc., a Hawaii corporation; and
WHEREAS, effective December 26, 1996, Aloha Hawaii merged with
Aloha Delaware, and Aloha Delaware emerged as the surviving entity and the
successor in interest to Aloha Hawaii; and
WHEREAS, as a result of the merger, all of the assets and
liabilities of Aloha Hawaii, including the Lease, will become assets and
liabilities of Aloha Delaware by operation of law; and
WHEREAS, Aloha Hawaii has requested that Lessor consent to the
merger and the transfer by operation of law of the Lease to Aloha Delaware;
NOW, THEREFORE, in consideration of these presents and for other
valuable consideration, Lessor does hereby consent to the merger of Aloha
Hawaii with and into Aloha Delaware and the transfer by operation of law of the
Lease to Aloha Delaware, upon and subject to the condition that this consent
shall not be construed as authorizing any other or further assignment of the
Lease, and that all of the rights of the undersigned as set forth in the Lease
are expressly reserved.
IN WITNESS WHEREOF, the undersigned has executed this Consent as of
the date first written above.
LESSOR: POLARIS HOLDING COMPANY
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title SENIOR VICE PRESIDENT
EXECUTION COPY
As of January 31, 1997
Aloha Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President-Finance and
Chief Financial Officer
Attention:
Re: Amendment Letter No. 1 to the Aircraft Lease Agreement dated as of
July 17, 1990 between Polaris Holding Company ("Lessor") and Aloha
Airlines, Inc. ("Lessee") for Aircraft SN 21809 as previously
supplemented and amended (the "Lease"), and as amended by Amendment
No. 1 thereto dated as of January 31, 1997 ("Lease Amendment No. 1")
to Letter Agreements No. 1 and No. 2 of even date with the Lease
between Lessor and Lessee,
Gentlemen:
In order to preserve the confidentiality of certain of the business
terms of the referenced Lease, and Lease Amendment No. 1, and the referenced
Letter Agreements No. 1 and No. 2, Lessor and Lessee have agreed that certain
terms used in or related thereto and other provisions shall be set forth in this
Amendment Letter No. 1 rather than in the body of Lease Amendment No. 1.
1. AMENDMENT TO LETTER AGREEMENT NO. 1 (BASIC RENT). The definition of
"Basic Rent" contained in Letter Agreement No. 1 is amended in its entirety to
read as follows:
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
Aloha Airlines, Inc.
As of January 31, 1997
Page 2
2. ADDITIONAL DEFINITIONS. The following definitions and values are
added to Letter Agreement No. 1:
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
3. SATISFACTION OF LETTER AGREEMENT NO. 2. Upon payment in full of all
Basic Rent due under the Lease through October 31, 2001, Lessee's obligations
under Letter Agreement No. 2 shall be deemed paid in full, satisfied and
discharged.
4. MISCELLANEOUS. Except as expressly provided herein, Lessee
acknowledges that nothing contained in this Amendment Letter is intended to
discharge, amend or other-wise modify its obligations under the Lease and Lease
Amendment No. 1. The Lease and Lease Amendment No. 1 are hereby ratified and
confirmed, but only as amended hereby and by Lease Amendment No. 1. Capitalized
terms used but not defined herein or Lease Amendment No. 1 shall have the
meanings ascribed to them in the Lease, as amended. This Amendment Letter No. 1
may be executed in one or more counterparts each of which when taken together
shall constitute one and the same instrument.
Aloha Airlines, Inc.
As of January 31, 1997
Page 3
If this letter is consistent with your understanding of the subject
matter hereof, please so confirm by executing this letter in the place indicated
and returning the fully executed letter to Lessor.
POLARIS HOLDING COMPANY, as Lessor
By: [ILLEGIBLE]
--------------------------
Title:
--------------------------
Senior Vice President
The undersigned hereby confirms that the foregoing letter accurately
reflects the understanding of the undersigned with respect to the subject matter
hereof.
ALOHA AIRLINES, INC., as Lessee
By:
--------------------------
Title:
--------------------------
By:
--------------------------
Title:
--------------------------
Aloha Airlines, Inc.
As of January 31, 1997
Page 3
If this letter is consistent with your understanding of the subject
matter hereof, please so confirm by executing this letter in the place
indicated and returning the fully executed letter to Lessor.
POLARIS HOLDING COMPANY, as Lessor
By:
-----------------------------
Title: Senior Vice President
-----------------------------
The undersigned hereby confirms that the foregoing letter
accurately reflects the understanding of the undersigned with respect to the
subject matter hereof.
ALOHA AIRLINES, INC., as Lessee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------
Title: Sr. Vice President Finance &
Planning and CFO
-----------------------------
By: [ILLEGIBLE]
-----------------------------
Title: Vice President Planning &
Development
-----------------------------
EXECUTION COPY
________________________________
AMENDMENT NO. 1
(Lease
Extension)
dated as of
January 31, 1997
to
AIRCRAFT LEASE AGREEMENT
PHC 90-047-WKH
dated as of July 17, 1990
BETWEEN
POLARIS HOLDING COMPANY
as Lessor
AND
ALOHA AIRLINES, INC.
as Lessee
__________________________
One Boeing Model 737-2M6C Aircraft
Manufacturer's Serial No. 21809
U.S. Registration No. N805AL
TABLE OF CONTENTS
DESCRIPTION PAGE
----------- ----
1. LEASE. 1
2. LEASE SUPPLEMENT. 3
3. RATIFICATION. 4
4. REPRESENTATIONS AND WARRANTIES OF LESSEE. 4
5. REPRESENTATIONS AND WARRANTIES OF LESSOR. 5
6. OPERATING RESTRICTIONS. 5
7. CONDITIONS PRECEDENT. 6
8. FURTHER CONDITIONS PRECEDENT. 6
9. MISCELLANEOUS. 6
RECORDED
Federal Aviation Administration
Date 3-10-97 Time 10:00 A
------- -------
Conveyance number XXOO7783
--------
By /s/ [ILLEGIBLE]
------------------
AMENDMENT NO. 1
(LEASE EXTENSION)
TO
AIRCRAFT LEASE
AGREEMENT
THIS AMENDMENT NO. 1 dated as of January 31, 1997 to the Aircraft Lease
Agreement dated as of July 17, 1990 (the "Lease Agreement") between POLARIS
HOLDING COMPANY ("Lessor"), and ALOHA AIRLINES, INC. ("Lessee").
WHEREAS, the Lease Agreement as supplemented by Lease Supplement No. 1
dated July 17, 1990 ("Lease Supplement No. 1 ") was recorded by the Federal
Aviation Administration (the "FAA") on July 17, 1990 as Conveyance No. S89046
(the Lease Agreement as so supplemented is hereinafter referred to as the
"Lease");
WHEREAS, the Lease is in respect of one Boeing Model 737-2M6C
Aircraft bearing manufacturer's serial number 21809 and U.S.
Registration No. N805AL, and certain related equipment (the "Aircraft"),
and
WHEREAS, Lessee and Lessor desire to extend the Term of the Lease
for fifty one (51) months from its present expiration date of July 31,
1997, and to amend certain terms of the Lease as provided herein and by
a separate Amendment Letter No. 1; and
WHEREAS, capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them in the Lease.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
1. LEASE.
The Lease is hereby amended as follows:
A. FIRST PAGE. The first paragraph is revised in its entirety to
read as follows:
"THIS AGREEMENT dated as of July 17,1990 PHC 90-047 WKH
(Lease), between POLARIS HOLDING COMPANY, a Delaware corporation,
with a place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ (Lessor), and ALOHA AIRLINES, INC., a
corporation organized under the laws of the State of Delaware, with
its principal place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇ (Lessee)."
1
B. Section 1. DEFINITIONS. is revised as follows:
(i) Add the following new definition:
"AMENDMENT LETTER NO. 1 shall mean that certain
Amendment Letter No. 1 dated as of January 31, 1997
between Lessor and Lessee in respect of Amendment No.
1 dated as of January 31, 1997 to Aircraft Lease
Agreement between Lessor and Lessee."
(ii) The definition of "CERTIFICATED AIR CARRIER" is amended in
its entirety to read:
"CERTIFICATED AIR CARRIER shall mean any Person (except
the United States Government) that is a citizen of the United
States of America (as defined in Section 40102 of Title 49 of
the United States Code) and holding a Certificate of Public
Convenience and Necessity issued under Section 41102 of Title
49 of the United States Code by the Department of
Transportation or any predecessor or successor agency
thereto, or, in the event such certificates shall no longer
be issued, any Person (except the United States Government)
that is a citizen of the United States of America (as defined
in Section 40102 of Title 49 of the United States Code) and
legally engaged in the business of transporting for hire
passengers or cargo by air predominantly to, from or between
points within the United States of America, and, in either
event, operating commercial jet aircraft capable of carrying
ten or more individuals or 6,000 pounds or more of cargo."
(iii) The definition of "FEDERAL AVIATION ACT" is amended in its
entirety to read:
"FEDERAL AVIATION ACT shall mean Title 49 of the United
States Code Section 40101 et. sec.; any reference to any
particular section or provision of the Federal Aviation Act
shall be deemed to be a reference to the appropriate section
or provision of Title 49 of the United States Code."
(iv) The definition of "INDEMNITEE" is amended in its entirety to
read:
"INDEMNITEE shall mean Lessor, GE Capital Aviation
Services, Inc., GE Capital Aviation Services Limited and
their respective successors and permitted assigns (including
their officers, directors, shareholders, agents and
employees)."
(v) The definition "RENEWAL TERM" is deleted in its entirety.
(vi) In the definition of "TERM", delete the phrase, "including
any Renewal Term or Terms".
2
C. Section 3(f) RENEWAL OPTION is hereby deleted in its
entirety.
D. Section 4(a)(iii) is amended by adding, after the words "Basic
Rent Payment Date" and before the period, the phrase "to and
including, but not after, July 31, 1997."
E. In Exhibit C certain definitions or values are amended as follows:
"Additional Rent: The Additional Rent shall be
in the amount and payable on each
Basic Rent Payment Date through and
including, but not after July 31,
1997 as specified in Letter
Agreement No. 1 to this Agreement."
"Casualty Value: The Amount set forth therefore in
Amendment Letter No. 1 to this
Agreement."
"Last Basic Rent Payment
Date: The Last Basic Rent Payment Date
for the Aircraft shall be on October
31, 2001."
"Lessor's Address Polaris Holding Company, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇, Attn: Senior Vice Present -
Marketing.
with a copy to:
GE Capital Aviation Services, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attn: Manager of
Operations."
"Public Liability and
Property Damage Insurance The Amount set forth therefore in
Amendment Letter No. 1 to this
Agreement."
2. LEASE SUPPLEMENT.
Section 3 of Lease Supplement No. 1 is hereby amended by deleting the
text thereof and by substituting therefor the following:
"3. The Term for the Delivered Aircraft shall commence on
the Delivery Date and shall end on the Expiration Date,
which shall be October 31, 2001."
3
3. RATIFICATION.
Except as expressly provided herein, Lessee acknowledges that nothing
contained in this Amendment is intended to discharge, amend or otherwise modify
its obligations under the Lease. The Lease is hereby ratified and confirmed,
but only as amended hereby and by Amendment Letter No. 1, in all respects.
4. REPRESENTATIONS AND WARRANTIES OF LESSEE.
Lessee represents and warrants to Lessor that:
(a) Lessee is a corporation duly formed, validly existing, and in good
standing under the laws of the State of Delaware;
(b) Lessee has full corporate power, authority and legal right to own its
property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Amendment and Amendment Letter No. 1,
and to perform its obligations hereunder and thereunder;
(c) This Amendment and Amendment Letter No. 1 have been duly authorized,
executed and delivered by Lessee and constitute the legal, valid and binding
obligations of Lessee enforceable in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting creditors' rights generally and
subject to principles of equity;
(d) The execution and delivery by Lessee of this Amendment and Amendment
Letter No. 1 will not conflict with or result in any breach of, constitute any
default under, or result in the creation of any lien, charge or encumbrance
pursuant to, any applicable law, any term or provision of Lessee's articles of
incorporation or by-laws or any judgment, order, writ, injunction, or decree of
any court, omission, board or Governmental Entity, or contravene any indenture,
mortgage, credit agreement, lease, license, contract or other agreement to
which Lessee is a party or by which it is bound;
(e) All consents or approvals required of Lessee by any Governmental
Entity or other Person in connection with the execution and delivery of this
Amendment and Amendment Letter No. 1 and the consummation by Lessee of the
transactions contemplated hereby and thereby have been duly obtained or waived;
(f) There are no pending or threatened actions or proceedings before any
court or administrative agency or other matters which might materially
adversely affect the ability of Lessee to perform its obligations under this
Amendment and Amendment Letter No. 1; and
(g) As of the date hereof, Lessee does not hold any contract or other
obligation to operate the Aircraft to any of the countries designated under the
United States Foreign Asset Control Regulations (31 C.F.R. Parts 500-599),
including, as of the date hereof, Cuba, Iraq, Libya, North Korea, the
Bosnia-Serb controlled areas of the Republic of Bosnia and Herzegovina
4
and the Unita Rebels of Angola, provided that nothing in this subsection shall
limit any further operation of the Aircraft to any such country pursuant to
proper authorization by the US Government.
5. REPRESENTATIONS AND WARRANTIES OF LESSOR.
Lessor represents and warrants to Lessee that:
(a) Lessor is a corporation duly formed, validly existing and in good
standing under the laws of Delaware;
(b) Lessor has full corporate power, authority and legal right to own its
property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Amendment and Amendment Letter No. 1,
and to perform its obligations hereunder and thereunder;
(c) this Amendment and Amendment Letter No. 1 have been duly authorized,
executed and delivered by Lessor and constitute the legal, valid and binding
obligations of Lessor enforceable in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting creditors' rights generally and
subject to principles of equity;
(d) The execution and delivery by Lessor of this Amendment and Amendment
Letter No. 1 will not conflict with or result in any breach of, constitute any
default under, or result in the creation of any lien, charge or encumbrance
pursuant to, any applicable law, any term or provision of or Lessor's articles
of incorporation or by-laws or any judgment, order, writ, injunction, or decree
of any court, commission, board of Governmental Entity, or contravene any
indenture, mortgage, credit agreement, lease, license, contract or other
agreement to which Lessor is a party or by which it is bound;
(e) Any consents or approvals required of Lessor by any Governmental
Entity in connection with the execution and delivery of this Amendment and
Amendment Letter No. 1 and the consummation by Lessor of the transactions
contemplated hereby and thereby have been duly obtained or waived; and
(f) There are no pending or threatened actions or proceedings before any
court or administrative agency or other matters which might materially
adversely affect the ability of Lessor to perform its obligations under this
Amendment or Amendment Letter No. 1.
6. OPERATING RESTRICTIONS.
Lessee shall not cause or permit the Aircraft to proceed to, or remain
at, any location which is then the subject of a prohibition order (or any
similar order or directive), sanctions or restrictions by or under the U.S.
International Economic Emergency Powers Act or the United Nations Security
Council (including, as of the date hereof, Iraq, Libya, the Bosnia - Serb
controlled areas of the Republic of Bosnia and Herzegovina and The Unita Rebels
of Angola) or
5
the U.S. Export Administration Act Regulations (15 C.F.R. Parts 730-799)
(including as of the date hereof Cuba, Iran, North Korea, Sudan
and Syria), except as may be permitted by operating in accordance with
the conditions specified by the U.S. Export Administration Regulations,
General License GATS (15 C.F.R. Part 771.19); provided that nothing
herein contained shall limit any future operation of the Aircraft to any
such country pursuant to proper authorization of the U.S. Government.
7. CONDITIONS PRECEDENT.
This Amendment and Lessor's obligation to extend the Lease shall take
effect upon issuance by Lessor of a notice to Lessee (the "Extension Notice")
confirming the satisfaction of each of the following conditions and receipt of
the following documents by Lessor:
(a) RESOLUTIONS: a copy of a resolution of the board of directors of
Lessee approving the terms of, and transactions contemplated by, this
Agreement, resolving that it enter into this Agreement, and authorizing a
specified person or persons to execute this Agreement;
(b) INSURANCES: certificates of insurance, an undertaking from Lessee's
insurance broker and other evidence satisfactory to Lessor of Lessee's due
compliance with the provisions of the Lease (as extended hereby) regarding
Insurances; and
(c) LEGAL OPINION: a legal opinion at Lessee's expense from counsel
acceptable to Lessor in form and substance satisfactory to Lessor and
confirming, inter alia, that this Agreement and Amendment Letter No. 1 have
been duly signed and delivered on behalf of Lessee, that this Agreement and
Amendment Letter No. 1 constitute Lessee's legal, valid and binding
obligations, and that all approvals, licenses, consents and registrations which
are necessary or desirable in connection with this Agreement and Amendment
Letter No. 1 and the performance by Lessee of its obligations hereunder,
thereunder and under the Lease as extended hereby and thereby have been
obtained and are in full force and effect;
8. FURTHER CONDITIONS PRECEDENT.
The obligation of Lessor to extend the Lease under this
Amendment No. 1 and Amendment Letter No. 1 are subject to the further
conditions precedent that as of the date of issuance of the Extension
Notice:
(a) the representations and warranties of Lessee under Section 4 of this
Agreement shall be true and correct; and
(b) no Default shall have occurred and be continuing or might result from
the leasing of the Aircraft to Lessee under the Lease as extended hereby and by
Amendment Letter No. 1.
9. MISCELLANEOUS.
(a) AMENDMENT. No amendment, modification or waiver of any provision
of this Amendment or Amendment Letter No. 1 shall in any event be effective
unless the same shall be in
6
writing and signed by the parties hereto or, in the case of a waiver, by the
party waiving compliance, and then such waiver shall be effective only in the
specific instance and for the specific purpose for which given.
(b) NOTICES. Any notices, requests, demands or other communications
required or permitted to be made hereunder shall be in writing and shall be
addressed as follows:
To Lessor: Polaris Holding Company
c/o GE Capital Aviation Services
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Senior Vice President
- Marketing
With a copy to: GE Capital Aviation Services
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Manager of Operations
To Lessee: Aloha Airlines, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President-Finance
and Chief Financial Officer
or in each case to such other person or address or addresses as one party may
notify in writing to the other party. All other communications and any notice
of change of address shall be deemed to have been received (and reference
herein to receipt by any party shall include deemed receipt) by the party to
whom it is addressed five (5) Business Days after positing in the case of
notice given by first class postage prepaid mail, or when received, in the case
of notice given by facsimile, or on delivery, if delivered by hand.
(c) GOVERNING LAW. THIS AMENDMENT, SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
CALIFORNIA.
(d) SEVERABILITY. If any one or more of the provisions contained in this
Amendment or any document executed in connection herewith shall be invalid,
illegal or unenforceable in any respect under any law, the validity, legality
and enforceability of the remaining provisions contained herein shall not in
any way be affected or impaired.
(e) COUNTERPARTS. This Amendment may be executed in counterparts and any
single counterpart or set of counterparts signed in either case, by all of the
parties hereto shall for all purposes be deemed to be an original, and all such
counterparts when taken together shall
7
constitute one and the same instrument. A facsimile signature on any
counterpart hereto will be deemed an original for all purposes.
(f) ENTIRE AGREEMENT. The terms and conditions contained in the Lease,
Letter Agreements No. 1 and No. 2 of even date with the Lease between Lessor
and Lessee, this Amendment, Amendment Letter No. 1 and the other documents and
instruments executed in connection therewith or herewith constitute the entire
agreement among the parities pertaining to the subject matter thereof and
hereof and supersede all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties.
(g) HEADINGS. The headings in this Amendment are for reference only, and
do not form part of and are not to be used to interpret this Agreement.
(h) EXPENSES AND BROKER INDEMNIFICATION. Each party agrees to pay any
broker or other agent retained by such party in connection with this Amendment
and Amendment Letter No. 1 and to defend the other party in respect of any
claims or demands in connection with this Amendment or Amendment Letter No. 1
brought by any person claiming to be its broker or other agent and to indemnify
and hold harmless the other party for loss, liabilities, judgments and expenses
as a result of such claims or demands, including, without limitation,
reasonable attorneys' fees and costs. Lessor and Lessee shall each be
responsible for their own costs and expenses associated with the negotiation
and documentation of this Agreement and Amendment Letter No. 1, and Lessee
shall also be responsible for all costs associated with perfecting this
Amendment and Amendment Letter No. 1 in the state of registration and the state
of habitual base of the Aircraft (and other states as appropriate given the
operation of the Aircraft), including (but not limited to) the provision of
legal opinions, tax advice, stamp duties, translations and registrations,
whether required by Lessor or Lessee. Notwithstanding the foregoing, however,
Lessor and Lessee shall share equally the costs of FAA counsel utilized in
connection with this Amendment.
(i) FURTHER ASSURANCES. Each party shall cooperate with the other and
execute and deliver such instruments and other documents as may be necessary to
effectuate and carry out the provisions of this Amendment and Amendment Letter
No. 1.
(j) SUCCESSORS AND ASSIGNS. This Amendment shall insure to the benefit
of, and be binding upon, the parties hereto and their respective successors
and assigns.
(k) TIME IS OF THE ESSENCE. Except as otherwise provided herein, time is
of the essence with respect to each provision of this Amendment and Amendment
Letter No. 1.
8
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1
to be duly executed by their respective officers thereunto duly authorized as
of the day and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Title: Senior Vice President
----------------------------
LESSEE:
ALOHA AIRLINES, INC.
By:
----------------------------
Name:
----------------------------
Title:
----------------------------
By:
----------------------------
Name:
----------------------------
Title:
----------------------------
9
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1
to be duly executed by their respective officers thereunto duly authorized as
of the day and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By:
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------
Title: Senior Vice President
----------------------------
LESSEE:
ALOHA AIRLINES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------
Title: Sr. Vice President Finance &
Planning
----------------------------
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------
Title: Vice President Planning &
Development
----------------------------
9
As of July 12, 2001
Aloha Airlines, Inc.
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President-Finance and
Chief Financial Officer
AMENDMENT LETTER NO. 2
----------------------
Re: Aircraft Lease Agreement dated as of July 17, 1990 between Polaris
Holding Company ("LESSOR") and Aloha Airlines, Inc. ("LESSEE") for
Aircraft MSN 21809 as previously supplemented and amended by Letter
Agreements Nos. 1 and 2 dated July 16, 1997 between Lessor and Lessee
by Amendment No. 1 dated as of January 31, 1997 between Lessor and
Lessee, and by Amendment Letter No. 1 dated as of January 31, 1997
between Lessor and Lessee (the "LEASE"), and as amended by Amendment
No. 2 thereto dated as of July 12, 2001 ("LEASE AMENDMENT NO. 2")
between Lessor and Lessee
Gentlemen:
In order to preserve the confidentiality of certain of the business
terms of the referenced Lease, and Lease Amendment No. 2, Lessor and Lessee
have agreed that certain terms used in or related thereto and other provisions
shall be set forth in this Amendment Letter No. 2 rather than in the body of
Lease Amendment No. 2.
1. AMENDMENT TO LETTER AGREEMENT NO. 1. The following definitions and
values contained in Letter Agreement No. 1 (as amended by Amendment Letter
No. 1) are amended as follows:
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
Aloha Airlines, Inc.
As of July 12, 2001
Page 2
2. MISCELLANEOUS. Except as expressly provided herein, Lessee
acknowledges that nothing contained in this Amendment Letter is intended to
discharge, amend or otherwise modify its obligations under the Lease and Lease
Amendment No. 2. The Lease and Lease Amendment No. 2 are hereby ratified and
confirmed, but only as amended hereby and by Lease Amendment No. 2. Capitalized
terms used but not defined herein or in Lease Amendment No. 2 shall have the
meanings ascribed to them in the Lease, as amended. This Amendment Letter No. 2
may be executed in one or more counterparts each of which when taken together
shall constitute one and the same instrument.
Aloha Airlines, Inc.
As of July 12, 2001
Page 3
If this letter is consistent with your understanding of the subject
matter hereof, please so confirm by executing this letter in the place
indicated and returning the fully executed letter to Lessor.
POLARIS HOLDING COMPANY, as Lessor
By: /s/ ▇▇▇▇▇▇ ▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇▇▇
Title: Vice President
-------------------------------
The undersigned hereby confirms that the foregoing letter accurately
reflects the understanding of the undersigned with respect to the subject
matter hereof.
ALOHA AIRLINES, INC., as Lessee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT HUMAN
RESOURCES
-------------------------------
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇
Title: SENIOR VICE PRESIDENT
PLANNING & BUSINESS DEVELOPMENT
-------------------------------
RECORDED
FEDERAL AVIATION ADMINISTRATION
Date 8/16/01 Time 11:57
Conveyance Number TO67449
By: [ILLEGIBLE]
--------------
_________________________
AMENDMENT NO. 2
(Lease Extension)
dated as of
July l2, 2001
to
AIRCRAFT LEASE AGREEMENT
PHC 90-047-WKH
dated as of July 17, 1990
BETWEEN
POLARIS HOLDING COMPANY
as Lessor
AND
ALOHA AIRLINES, INC.
as Lessee
_________________________
One Boeing Model 737-2M6C Aircraft
Manufacturer's Serial No. 21809
U.S. Registration No. N805AL
TABLE OF CONTENTS
DESCRIPTION PAGE
----------- ----
1. LEASE. 1
2. LEASE SUPPLEMENT. 2
3. RATIFICATION. 2
4. REPRESENTATIONS AND WARRANTIES OF LESSEE. 2
5. REPRESENTATIONS AND WARRANTIES OF LESSOR. 3
6. CONDITIONS PRECEDENT. 4
7. FURTHER CONDITIONS PRECEDENT. 4
8. MISCELLANEOUS. 5
AMENDMENT NO. 2
(LEASE EXTENSION)
TO
AIRCRAFT LEASE
AGREEMENT
THIS AMENDMENT NO. 2 dated as of July 12, 2001 to the Aircraft Lease
Agreement dated as of July 17, 1990 (the "Lease Agreement") between POLARIS
HOLDING COMPANY ("Lessor"), and ALOHA AIRLINES, INC. ("Lessee").
WHEREAS, the Lease Agreement as supplemented by Lease Supplement No. 1
dated July 17, 1990 ("Lease Supplement No. 1") was recorded by the Federal
Aviation Administration (the "FAA") on July 17, 1990, as Conveyance No. S89046
(the Lease Agreement as so supplemented is hereinafter referred to as the
"Original Lease"); and
WHEREAS, pursuant to Amendment No. 1 dated as of January 31, 1997 between
Lessee and Lessor recorded by the FAA on March 10, 1997, as Conveyance No.
XX007783, Lessee and Lessor extended the Tenn of the Original Lease for
fifty-one (51) months from its original expiration date of July 31, 1997 to a
revised expiration date of October 31, 2001, and amended certain terms of the
Original Lease as provided therein and also by a separate Amendment Letter No.
1 (and, as assigned and amended by that certain Assignment, Assumption,
Amendment and Consent dated as of December 26, 1996 between Lessor and Aloha
Airlines, Inc., a Hawaii corporation, and Aloha Airlines, Inc., a Delaware
corporation, recorded by the FAA on February 3, 1998 as Conveyance No.
II010398, the Original Lease as so extended and amended is hereinafter referred
to as the "Lease"); and
WHEREAS, the Lease is in respect of one Boeing Model 737-2M6C Aircraft
bearing manufacturer's serial number 21809 and U.S. Registration No. N805AL,
and certain related equipment (the "Aircraft"); and
WHEREAS, capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them in the Lease.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
1. LEASE.
The Lease is hereby amended as follows:
A. FIRST PAGE. The first paragraph is revised in its entirety
to read as follows:
"THIS AGREEMENT dated as of July 17,1990 PHC 90-047 WKH
(Lease), between POLARIS HOLDING COMPANY, a Delaware corporation,
with a place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
1
(Lessor), and ALOHA AIRLINES, INC., a corporation organized under
the laws of the State of Delaware, with its principal place of
business at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ (Lessee)."
B. Section 1. DEFINITIONS. is revised as follows:
(i) Add the following new definition:
"AMENDMENT LETTER No. 2 shall mean that certain
Amendment Letter No. 2 dated as of July 12, 2001 between
Lessor and Lessee in respect of Amendment No. 2 dated as
of July 12, 2001 to Aircraft Lease Agreement between
Lessor and Lessee."
C. In Exhibit C certain definitions or values are amended as follows:
"Casualty Value: The Amount set forth therefore in
Amendment Letter No. 2."
"Last Basic Rent Payment
Date: The Last Basic Rent Payment Date
for the Aircraft shall be on
October 1, 2002."
"Lessor's Address Polaris Holding Company, c/o GE
Capital Aviation Services, Inc.,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn:
Contracts Leader."
2. LEASE SUPPLEMENT.
Section 3 of Lease Supplement No. 1 is hereby amended by deleting the
text thereof and by substituting therefor the following:
"3. The Term for the Delivered Aircraft shall commence on the
Delivery Date and shall end on the Expiration Date, which shall
be October 31, 2002."
3. RATIFICATION.
Except as expressly provided herein, Lessee acknowledges that nothing
contained in this Amendment is intended to discharge, amend or otherwise modify
its obligations under the Lease. The Lease is hereby ratified and confirmed,
but only as amended hereby and by Amendment Letter No. 2, in all respects.
4. REPRESENTATIONS AND WARRANTIES OF LESSEE.
Lessee represents and warrants to Lessor that:
2
(a) Lessee is a corporation duly formed, validly existing, and in good
standing under the laws of the State of Delaware;
(b) Lessee has full corporate power, authority and legal right to own its
property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Amendment and Amendment Letter No. 2,
and to perform its obligations hereunder and thereunder;
(c) This Amendment and Amendment Letter No. 2 have been duly authorized,
executed and delivered by Lessee and constitute the legal, valid and binding
obligations of Lessee enforceable in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting creditors' rights generally and
subject to principles of equity;
(d) The execution and delivery by Lessee of this Amendment and Amendment
Letter No. 1 will not conflict with or result in any breach of, constitute any
default under, or result in the creation of any lien, charge or encumbrance
pursuant to, any applicable law, any term or provision of Lessee's articles of
incorporation or by-laws or any judgment, order, writ, injunction, or decree of
any court, omission, board or Governmental Entity, or contravene any indenture,
mortgage, credit agreement, lease, license, contract or other agreement to
which Lessee is a party or by which it is bound;
(e) All consents or approvals required of Lessee by any Governmental
Entity or other Person in connection with the execution and delivery of this
Amendment and Amendment Letter No. 2 and the consummation by Lessee of the
transactions contemplated hereby and thereby have been duly obtained or waived;
and
(f) There are no pending or threatened actions or proceedings before any
court or administrative agency or other matters which might materially
adversely affect the ability of Lessee to perform its obligations under this
Amendment and Amendment Letter No. 2.
5. REPRESENTATIONS AND WARRANTIES OF LESSOR.
Lessor represents and warrants to Lessee that:
(a) Lessor is a corporation duly formed, validly existing and in good
standing under the laws of Delaware;
(b) Lessor has full corporate power, authority and legal right to own its
property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Amendment and Amendment Letter No. 2,
and to perform its obligations hereunder and thereunder;
(c) this Amendment and Amendment Letter No. 2 have been duly authorized,
executed and delivered by Lessor and constitute the legal, valid and binding
obligations of Lessor enforceable in accordance with their terms, except as
such enforceability may be limited by
3
applicable bankruptcy, insolvency, moratorium or other similar laws affecting
creditors' rights generally and subject to principles of equity;
(d) The execution and delivery by Lessor of this Amendment and Amendment
Letter No. 2 will not conflict with or result in any breach of, constitute any
default under, or result in the creation of any lien, charge or encumbrance
pursuant to, any applicable law, any term or provision of or Lessor's articles
of incorporation or by-laws or any judgment, order, writ, injunction, or decree
of any court, commission, board of Governmental Entity, or contravene any
indenture, mortgage, credit agreement, lease, license, contract or other
agreement to which Lessor is a party or by which it is bound;
(e) Any consents or approvals required of Lessor by any Governmental
Entity in connection with the execution and delivery of this Amendment and
Amendment Letter No. 2 and the consummation by Lessor of the transactions
contemplated hereby and thereby have been duly obtained or waived; and
(f) There are no pending or threatened actions or proceedings before any
court or administrative agency or other matters which might materially
adversely affect the ability of Lessor to perform its obligations under this
Amendment or Amendment Letter No. 2.
6. CONDITIONS PRECEDENT.
This Amendment and Lessor's obligation to extend the Lease shall take
effect upon issuance by Lessor of a notice to Lessee (the "Extension Notice")
confirming the satisfaction of each of the following conditions and receipt of
the following documents by Lessor:
(a) RESOLUTIONS: a copy of a resolution of the board of directors of
Lessee approving the terms of, and transactions contemplated by, this
Agreement, resolving that it enter into this Agreement, and authorizing a
specified person or persons to execute this Agreement;
(b) INSURANCES: certificates of insurance, an undertaking from Lessee's
insurance broker and other evidence satisfactory to Lessor of Lessee's due
compliance with the provisions of the Lease (as extended hereby) regarding
Insurances; and
(c) LEGAL OPINION: a legal opinion at Lessee's expense from counsel
acceptable to Lessor in form and substance satisfactory to Lessor and
confirming, inter alia, that this Agreement and Amendment Letter No. 2 have
been duly signed and delivered on behalf of Lessee, that this Agreement and
Amendment Letter No. 2 constitute Lessee's legal, valid and binding
obligations, and that all approvals, licenses, consents and registrations which
are necessary or desirable in connection with this Agreement and Amendment
Letter No. 2 and the performance by Lessee of its obligations hereunder,
thereunder and under the Lease as extended hereby and thereby have been
obtained and are in full force and effect.
7. FURTHER CONDITIONS PRECEDENT.
4
The obligation of Lessor to extend the Lease under this Amendment
No. 2 and Amendment Letter No. 2 are subject to the further conditions
precedent that as of the date of issuance of the Extension Notice:
(a) the representations and warranties of Lessee under Section 4 of this
Agreement shall be true and correct; and
(b) no Default shall have occurred and be continuing or might result from
the leasing of the Aircraft to Lessee under the Lease as extended hereby and by
Amendment Letter No. 2.
8. MISCELLANEOUS.
(a) AMENDMENT. No amendment, modification or waiver of any provision of
this Amendment or Amendment Letter No. 2 shall in any event be effective unless
the same shall be in writing and signed by the parties hereto or, in the case
of a waiver, by the party waiving compliance, and then such waiver shall be
effective only in the specific instance and for the specific purpose for which
given.
(b) NOTICES. Any notices, requests, demands or other communications
required or permitted to be made hereunder shall be in writing and shall be
addressed as follows:
To Lessor: Polaris Holding Company
c/o GE Capital Aviation Services
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Contracts Leader
To Lessee: Aloha Airlines, Inc.
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President-Finance
and Chief Financial Officer
or in each case to such other person or address or addresses as one party may
notify in writing to the other party. All other communications and any notice
of change of address shall be deemed to have been received (and reference
herein to receipt by any party shall include deemed receipt) by the party to
whom it is addressed five (5) Business Days after positing in the case of
notice given by first class postage prepaid mail, or when received, in the case
of notice given by facsimile, or on delivery, if delivered by hand.
(c) GOVERNING LAW. THIS AMENDMENT, SHALL IN ALL RESPECTS BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA.
5
(d) SEVERABILITY. If any one or more of the provisions contained in this
Amendment or any document executed in connection herewith shall be invalid,
illegal or unenforceable in any respect under any law, the validity, legality
and enforceability of the remaining provisions contained herein shall not in
any way be affected or impaired.
(e) COUNTERPARTS. This Amendment may be executed in counterparts and any
single counterpart or set of counterparts signed in either case, by all of the
parties hereto shall for all purposes be deemed to be an original, and all such
counterparts when taken together shall constitute one and the same instrument.
A facsimile signature on any counterpart hereto will be deemed an original for
all purposes.
(f) ENTIRE AGREEMENT. The terms and conditions contained in the Lease,
Letter Agreements No. 1 and No. 2 of even date with the Original Lease between
Lessor and Lessee, this Amendment, Amendment Letter No. 2 and the other
documents and instruments executed in connection therewith or herewith
constitute the entire agreement among the parities pertaining to the subject
matter thereof and hereof and supersede all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the parties.
(g) HEADINGS. The headings in this Amendment are for reference only, and
do not form part of and are not to be used to interpret this Agreement.
(h) EXPENSES AND BROKER INDEMNIFICATION. Each party agrees to pay any
broker or other agent retained by such party in connection with this Amendment
and Amendment Letter No. 2 and to defend the other party in respect of any
claims or demands in connection with this Amendment or Amendment Letter No. 2
brought by any person claiming to be its broker or other agent and to indemnify
and hold harmless the other party for loss, liabilities, judgments and expenses
as a result of such claims or demands, including, without limitation,
reasonable attorneys' fees and costs. Lessor and Lessee shall each be
responsible for their own costs and expenses associated with the negotiation
and documentation of this Agreement and Amendment Letter No. 2, and Lessee
shall also be responsible for all costs associated with perfecting this
Amendment and Amendment Letter No. 2 in the state of registration and the state
of habitual base of the Aircraft (and other states as appropriate given the
operation of the Aircraft), including (but not limited to) the provision of
legal opinions, tax advice, stamp duties, translations and registrations,
whether required by Lessor or Lessee. Notwithstanding the foregoing, however,
Lessor and Lessee shall share equally the costs of FAA counsel utilized in
connection with this Amendment.
(i) FURTHER ASSURANCES. Each party shall cooperate with the other and
execute and deliver such instruments and other documents as may be necessary to
effectuate and carry out the provisions of this Amendment and Amendment Letter
No. 2.
(j) SUCCESSORS AND ASSIGNS. This Amendment shall insure to the benefit
of, and be binding upon, the parties hereto and their respective successors
and assigns.
(k) TIME IS OF THE ESSENCE. Except as otherwise provided herein, time is
of the essence with respect to each provision of this Amendment and Amendment
Letter No. 2.
6
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2
to be duly executed by their respective officers thereunto duly authorized as
of the day and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By: [ILLEGIBLE]
-----------------------------------
Name: [ILLEGIBLE]
Title: Vice President
LESSEE:
ALOHA AIRLINES, INC.
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
7
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2
to be duly executed by their respective officers thereunto duly authorized as
of the day and year first above written.
LESSOR:
POLARIS HOLDING COMPANY
By:
-----------------------------------
Name:
Title:
LESSEE:
ALOHA AIRLINES, INC.
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
HUMAN RESOURCES
By: ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: PLANNING & BUSINESS DEVELOPMENT
7
Dated as of December 14, 2001
Aloha Airlines, Inc.
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President - Finance and
Chief Financial Officer
AMENDMENT LETTER NO. 3
Re: Aircraft Lease Agreement dated as of July 17, 1990 between Polaris Holding
Company ("Lessor") and Aloha Airlines, Inc. ("Lessee") for Aircraft MSN
21809 as previously supplemented and amended by Lease Supplement No. 1
dated July 17, 1990 between Lessor and Lessee, Letter Agreements Nos. 1
and 2 dated July 16, 1990 between Lessor and Lessee, Amendment No. 1 dated
as of January 31, 1997 between Lessor and Lessee, Amendment Letter No. 1
dated as of January 31, 1997 between Lessor and Lessee, Amendment No. 2
dated as of July 12, 2001 between Lessor and Lessee, Amendment Letter
No. 2 between Lessor and Lessee (the "Lease") and as amended by Amendment
No. 3 thereto dated as of the date hereof between Lessor and Lessee
("Lease Amendment No. 3")
Ladies and Gentlemen:
In order to preserve the confidentiality of certain of the business
terms of the referenced Lease and Lease Amendment No. 3, Lessor and Lessee
have agreed that certain terms used in or related thereto and other
provisions shall be set forth in this Amendment Letter No. 3 rather than in
the body of Lease Amendment No. 3.
1. AMENDMENT TO LETTER AGREEMENT NO. 1. The following definitions and
values contained in Letter Agreement No. 1 (as amended by Amendment Letter
No. 1 and Amendment Letter No. 2) are hereby amended as follows:
[This provision has been omitted as confidential information, and is
separately filed with the Commission.]
Aloha Airlines, Inc.
Page 2
2. WAIVER. Lessor and Lessee acknowledge and agree that Lessee has
not paid the installment of Basic Rent that was due on October 31, 2001.
Lessor hereby agrees that, upon satisfaction of the conditions precedent set
forth in Section 5 of Lease Amendment No. 3, Lessor shall be deemed to have
irrevocably waived payment of such installment of Basic Rent.
3. MISCELLANEOUS. Except as otherwise provided herein, Lessee
acknowledges that nothing in this Amendment Letter No. 3 is intended to
discharge, amend or otherwise modify its obligations under the Lease or under
Lease Amendment No. 3. The Lease, as modified by this Amendment Letter No. 3
and by Lease Amendment No. 3, is hereby ratified and confirmed. Capitalized
terms used but not defined herein shall have the meanings ascribed to them in
the Lease4, as amended by this Amendment Letter No. 3 and by Lease Amendment
No. 3.
Aloha Airlines, Inc.
Page 3
If this letter is consistent with your understanding of the subject
matter hereof, please so confirm by executing this letter in the place
indicated and returning the fully executed letter to Lessor.
POLARIS HOLDING COMPANY, as Lessor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Title: Vice President
--------------------------------
The undersigned hereby confirms that the foregoing letter accurately
reflects the understanding of the undersigned with respect to the subject
matter hereof.
ALOHA AIRLINES, Inc., as Lessee
By:
-----------------------------------
Name:---------------------------------
Title:--------------------------------
By:
-----------------------------------
Name:---------------------------------
Title:--------------------------------
Aloha Airlines, Inc.
Page 3
If this letter is consistent with your understanding of the
subject matter hereof, please so confirm by executing this letter in the
place indicated and returning the fully executed letter to Lessor.
POLARIS HOLDING COMPANY, as Lessor
By:
-----------------------------------
Name:---------------------------------
Title:--------------------------------
The undersigned hereby confirms that the foregoing letter
accurately reflects the understanding of the undersigned with respect to
the subject matter hereof.
ALOHA AIRLINES, Inc., as Lessee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------
Title: Exec. Vice President & CFO
--------------------------------
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
Title: Sr. Vice President Planning &
Business Development
--------------------------------
____________________________
AMENDMENT NO. 3
dated as of
December 14, 2001
to
AIRCRAFT LEASE AGREEMENT
PHC 90-047-WKH
dated as of July 17, 1990
between
POLARIS HOLDING COMPANY,
as Lessor
And
ALOHA AIRLINES, INC.,
as Lessee
____________________________
One Boeing Model 737-2M6C Aircraft
Manufacturer's Serial No. 21809
U.S. Registration No. N805AL
AMENDMENT NO. 3
to
AIRCRAFT LEASE AGREEMENT
THIS AMENDMENT NO. 3 dated as of December 14, 2001 (this "Agreement")
to the Aircraft Lease Agreement dated as of July 17, 1990 (the "Lease
Agreement") between POLARIS HOLDING COMPANY ("Lessor") and ALOHA AIRLINNES,
INC. ("Lessee").
WHEREAS, the Lease Agreement as supplemented and amended by the
instruments described on Schedule I hereto and as further amended and
supplemented by Letter Agreement Nos. 1 and 2, each dated July 16, 2001
between Lessor and Lessee, Amendment Letter No. 1 dated as of January 31,
1997 and Amendment No. 2 dated as of July 12, 2001 is referred to herein as
the "Lease";
WHEREAS, the Lease is in respect of one Boeing Model 737-2M6C aircraft
bearing manufacturer's serial number 21809 and U.S. Registration No. N805AL,
and certain related equipment (the "Aircraft");
WHEREAS, capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them in the Lease;
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
1. AMENDMENT TO LEASE.
A. AMENDMENT TO SECTION 1 ("DEFINITIONS"). Section 1
("Definitions") is hereby amended by adding the following as a new
definition:
"AMENDMENT LETTER No. 3 shall mean that certain Amendment Letter
No. 3 dated as of December 14, 2001 between Lessor and Lessee in
respect of Amendment No. 3 dated as of December 14, 2001 to Aircraft
Lease Agreement between Lessor and Lessee."
B. AMENDMENTS TO SECTION 12 ("INSURANCE").
1. AMENDMENT TO SECTION 12(a). Section 12(a) is hereby amended
by adding the following to the end of the existing provision:
"In addition, without limitation of the preceding requirements of this
Section 12(a) (and notwithstanding anything to the contrary contained
herein), Lessee shall in all events maintain war risk and allied perils
liability insurance in accordance with London form AVN52C (as in effect
on September 1, 2001) or its equivalent form reasonably acceptable to
Lessor (or an agreement of the United States Government to insure
against or indemnify for substantially the same risks), from time to
time, with respect to the Aircraft in an amount not less than the
amount under "Public Liability and Property Damage Insurance" as set
forth on Exhibit C."
2. AMENDMENT TO SECTION 12(b). Section 12(b) is hereby amended by
adding the following after the phrase "comprehensive war risk and allied
perils" and before the comma at the end of the fourth line thereof:
"in accordance with LSW555B or its equivalent form reasonably
acceptable to Lessor (or an agreement of the United States Government
to insure against or indemnify for substantially the same risks)"
C. AMENDMENT TO EXHIBIT C. The definition of "Casualty Value" in Exhibit
C is hereby amended to read in its ENTIRETY as follows:
"Casualty Value: The amount set forth therefore in Amendment Letter
No. 3"
2. RATIFICATION.
Except as expressly provided herein, Lessee acknowledges that nothing
contained in this Agreement is intended to discharge, amend or otherwise
modify its obligations under the Lease. The Lease is hereby ratified and
confirmed, but only as amended hereby and by Amendment Letter No. 3 in all
respects.
3. REPRESENTATIONS AND WARRANTIES OF LESSEE.
Lessee represents and warrants to Lessor that:
(a) Lessee is a corporation duly formed, validly existing, and in good
standing under the laws of the State of Delaware;
(b) Lessee has full corporate power, authority and legal right to own
its property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Agreement and Amendment Letter No. 3
and to perform its obligations hereunder and thereunder;
(c) This Agreement and Amendment Letter No. 3 have been duly authorized,
executed and delivered by Lessee and constitute the legal, valid and binding
obligations of Lessee enforceable in accordance with their terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting creditors' rights generally and
subject to principles of equity;
(d) The execution and delivery by Lessee of this Agreement and Amendment
Letter No. 3 will not conflict with or result in any breach of, constitute
any default under, or result in the creation of any lien, charge or
encumbrance pursuant to, any applicable law, any term or provision of
Lessee's articles of incorporation or by-laws or any judgment, order, writ,
injunction, or decree or any court, commission, board or Governmental Entity,
or contravene any indenture, mortgage, credit agreement, lease, license,
contract or other agreement to which Lessee is a party or by which it is
bound;
(e) All consents or approvals required of Lessee by any Governmental
Entity or other Person in connection with the execution and delivery of this
Agreement and Amendment Letter No. 3 and the consummation by Lessee of the
transactions contemplated hereby and thereby have been duly obtained or
waived; and
(f) There are no pending or threatened actions or proceedings before
any court or administrative agency or other matters which might materially
adversely affect the ability of Lessee to perform its obligations under this
Agreement and Amendment Letter No. 3.
4. REPRESENTATIONS AND WARRANTIES OF LESSOR.
Lessor represents and warrants to Lessee that:
(a) Lessor is a corporation duly formed, validly existing, and in good
standing under the laws of the State of Delaware;
(b) Lessor has full corporate power, authority and legal right to own
its property and to carry on its business as now being conducted and is duly
authorized to execute and deliver this Agreement and Amendment Letter No. 3
and to perform its obligations hereunder, and thereunder;
(c) This Agreement and Amendment Letter No. 3 have been duly
authorized, executed and delivered by Lessor and constitute the legal, valid
and binding obligations of Lessor enforceable in accordance with their terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or other similar laws affecting creditors' rights
generally and subject to principles of equity;
(d) The execution and delivery by Lessor of this Agreement and
Amendment Letter No. 3 will not conflict with or result in any breach of,
constitute any default under, or result in the creation of any lien, charge
or encumbrance pursuant to, any applicable law, any term or provision of
Lessor's articles of incorporation or by-laws or any judgment, order, writ,
injunction, or decree or any court, commission, board or Governmental Entity,
or contravene any indenture, mortgage, credit agreement, lease, license,
contract or other agreement to which Lessor is a party or by which it is
bound;
(e) All consents or approvals required of Lessor by any Governmental
Entity or other Person in connection with the execution and delivery of this
Agreement and Amendment Letter No. 3 and the consummation by Lessor of the
transactions contemplated hereby and thereby have been duly obtained or
waived; and
(f) There are no pending or threatened actions or proceedings before
any court or administrative agency or other matters which might materially
adversely affect the ability of Lessor to perform its obligations under this
Agreement and Amendment Letter No. 3.
5. CONDITIONS PRECEDENT.
This Agreement and the waiver and amendments set forth in Amendment
Letter No. 3 shall take effect upon issuance by Lessor of a notice to Lessee
(the "Notice") confirming the satisfaction of each of the following
conditions and receipt of the following documents by Lessor:
(a) RESOLUTIONS: a copy of the resolutions of the Board of Directors
of Lessee approving the terms of, and transactions contemplated by, this
Agreement and Amendment Letter No. 3, and authorizing a specified person or
persons to execute this Agreement and Amendment Letter No. 3;
(b) LEGAL OPINION: a legal opinion at Lessee's expense from counsel
acceptable to Lessor in form and substance satisfactory to Lessor and
confirming, inter alia, that this
Agreement and Amendment Letter No. 3 have been duly executed and delivered
on behalf of Lessee, that this Agreement and Amendment Letter No. 3
constitute legal, valid and binding obligations of Lessee, and that all
approvals, licenses, consents and registrations which are necessary or
desirable in connection with this Agreement and Amendment Letter No. 3 and
the performance by Lessee of its obligations under the Lease as amended
hereby and thereby have been obtained and are in full force and effect.
6. FURTHER CONDITIONS PRECEDENT.
The obligations of Lessor with respect to the waiver and amendments set
forth in Amendment Letter No. 3 are subject to the further conditions
precedent that as of the date of the issuance of the Notice:
(a) the representations and warranties of Lessee under Section 3 of
this Agreement shall be true and correct;
(b) no Default shall have occurred and be continuing or might result
from the leasing of the Aircraft to Lessee under the Lease as amended by this
Agreement and Amendment Letter No. 3.
7. MISCELLANEOUS.
(a) AMENDMENT. No amendment, modification or waiver of any provision of
this Agreement or Amendment Letter No. 3 shall in any event be effective
unless the same shall be in writing and signed by the parties hereto or, in
the case of a waiver, by the party waiving compliance, and then such waiver
shall be effective only in the specific instance and for the specific purpose
for which given.
(b) NOTICES. Any notices, requests, demands or other communications
required or permitted to be made hereunder shall be in writing and shall be
addressed as follows:
To Lessor: Polaris Holding Company
c/o GE Capital Aviation Services
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Contracts Leader
To Lessee: Aloha Airlines, Inc.
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Senior Vice President Finance and
Chief Financial Officer
or in each case to such other person or address or addresses as one party may
notify in writing to the other party. All other communications and any notice
of change of address shall be deemed to have been received (and reference
herein to receipt by any party shall include deemed receipt) by the party to
whom it is addressed five (5) Business Days after posting in the case of
notice given by first class postage prepaid mail, or when received, in the
case of notice given by facsimile, or on delivery, if delivered by hand.
(c) GOVERNING LAW. This Agreement and Amendment Letter No. 3 shall
in all respects be governed by, and construed in accordance with, the laws
of the State of California.
(d) SEVERABILITY. If any one or more of the provisions contained in
this Agreement or Amendment Letter No. 3 or any document executed in
connection herewith or therewith shall be invalid, illegal or unenforceable
in any respect under any law, the validity, legality and enforceability of
the remaining provisions contained herein and therein shall not in any way be
affected or impaired.
(e) COUNTERPARTS. This Agreement and Amendment Letter No. 3 may be
executed in counterparts and any single counterpart or set of counterparts
signed in either case, by all of the parties hereto and thereto shall for all
purposes deemed to be an original, and all such counterparts when taken
together shall constitute one and the same instrument. A facsimile signature
on any counterpart hereto will be deemed an original for all purposes.
(f) ENTIRE AGREEMENT. The terms and conditions contained in the Lease,
as amended by this Agreement and Amendment Letter No. 3, constitute the
entire agreement among the parties pertaining to the subject matter thereof
and supersede all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the parties.
(g) HEADINGS. The headings in this Agreement are for reference only,
and do not form part of and are not to be used to interpret this Agreement.
(h) EXPENSES AND BROKER INDEMNIFICATION. Each party agrees to pay any
broker or other agent retained by such party in connection with this
Agreement and Amendment Letter No. 3 and to defend the other party in respect
of any claims or demands in connection with this Agreement or Amendment
Letter No. 3 brought by any person claiming to be its broker or other agent
and to indemnify and hold harmless the other party for loss, liabilities,
judgments and expenses as a result of such claims or demands, including,
without limitation, reasonable attorney's fees and costs. Whether or not the
conditions specified in Sections 5 and 6 are fulfilled, Lessee shall pay to
Lessor on demand all fees, costs and expenses incurred or payable by Lessor
in connection with the preparation, negotiation and completion of this
Agreement and performance of the transactions contemplated hereby.
(i) FURTHER ASSURANCES. Each party shall cooperate with the other and
deliver such instruments and other documents as may be necessary to
effectuate and carry out the provisions of this Agreement and Amendment
Letter No. 3.
(j) SUCCESSORS AND ASSIGNS. This Agreement and Amendment Letter No. 3
shall inure to the benefit of, and be binding upon, the parties hereto and
their respective successors and assigns.
(k) TIME IS OF THE ESSENCE. Except as otherwise provided herein, time
is of the essence with respect to each provision of this Agreement and
Amendment Letter No. 3.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, each
by their duly authorized representative(s), as of the date shown at the
beginning of this Agreement.
LESSOR: LESSEE:
POLARIS HOLDING COMPANY ALOHA AIRLINES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By:---------------------------
----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name:
Title: Vice President Title:
By: --------------------------
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
each by their duly authorized representative(s), as of the date shown at the
beginning of this Agreement.
LESSOR: LESSEE:
POLARIS HOLDING COMPANY ALOHA AIRLINES. INC.
By:----------------------- By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------
Name: Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Title: Exec. Vice President & CFO
--------------------------
By: ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: SENIOR VICE PRESIDENT
PLANNING & BUSINESS DEVELOPMENT
SCHEDULE 1
Aircraft Lease Agreement PHC 90-047 WKH dated as of July 17, 1990
between Polaris Holding Company, as lessor, and Aloha Airlines, Inc., a Hawaii
corporation, as lessee, which was recorded by the Federal Aviation
Administration on July 17, 1990 and assigned Conveyance No. S89046, as
supplemented, amended and assigned by the following described instruments:
DOCUMENT FAA RECORDING DATE FAA CONVEYANCE NO.
-------- ------------------ ------------------
Lease Supplement No. 1 07/17/90 S89046
Amendment No. 1 (Lease 03/10//97 XX007783
Extension)
Assignment, Assumption,
Amendment and Consent between
Polaris Holding Company, as
lessor, Aloha Airlines, Inc., a
Hawaii corporation, as assignor,
and Aloha Airlines, Inc., a
Delaware corporation, as assignee 02/03/98 II10398
Amendment No. 2 (Lease 08/16/01 T067449
Extension)
