Delaware	94-3263974
(State of Incorporation)	(I.R.S. Employer Identification No.)

Item 9.01

Financial Statements and Exhibits

10.1	Fourth Amended and Restated Loan and Security Agreement, dated May 1, 2020, between the Company and MUFG Union Bank, N.A., as administrative agent, and MUFG Union Bank, N.A. ("MUFG"), U.S. Bank National Association ("US Bank"), Umpqua Bank,  Columbia State Bank, and Zions Bancorporation, N.A.(fka ZB, N.A.) dba California Bank & Trust (“CB&T”)
10.2	Fourth Amended and Restated Mortgage and Security Agreement, dated as of May 1, 2020 (this "Mortgage"), between the Company, MUFG as adminstrative agent, and MUFG Union Bank, N.A. ("MUFG"), U.S. Bank National Association ("US Bank"), Umpqua Bank,  Columbia State Bank, and Zions Bancorporation, N.A.(fka ZB, N.A.) dba California Bank & Trust (“CB&T”)

 

EXHIBIT 10.1

 

FOURTH AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

between

AEROCENTURY CORP.,

as Borrower

THE FINANCIAL INSTITUTIONS PARTIES HERETO

FROM TIME TO TIME,

as Lenders

and

MUFG UNION BANK, N.A.,

as Administrative Agent

 

May 1, 2020

 

 

 

 

TABLE OF CONTENTS

Page

1. DEFINITIONS AND RULES OF CONSTRUCTION 

2. TERM LOAN COMMITMENT 

3. SECURITY 

4. CONDITIONS PRECEDENT 

5. REPRESENTATIONS AND WARRANTIES 

6. AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION AND REPORTING REQUIREMENTS) 

7. NEGATIVE COVENANTS 

8. INFORMATION AND REPORTING REQUIREMENTS 

9. EVENTS OF DEFAULT; RIGHTS AND REMEDIES 

10. SUCCESSORS AND ASSIGNS 

11. DISPUTE RESOLUTION 

12. MISCELLANEOUS 1

12.10 Sharing of Setoffs  

12.11 Section Titles  

12.12 Counterparts  

12.13 Time of the Essence  

12.14 GOVERNING LAW; VENUE  

12.15 WAIVER OF JURY TRIAL  

12.16 Amendments; Consents  

12.17 Foreign Lenders and Participants  

12.18Acknowledgement and Consent to Bail-In of Affected Financial Institutions  

12.19 Disclaimer of Fiduciary Obligations  

12.20 Electronic Transmissions.  

13. AGENT 1

13.10 Agent May File Proofs of Claim  

13.11 No Obligations of Borrower  

14. COMMITMENT COSTS AND RELATED MATTERS. 1

15. AMENDMENT AND RESTATEMENT 

16. FORBEARANCE; GENERAL RELEASE 

 

INDEX OF SCHEDULES AND EXHIBITS

 

 

 

FOURTH AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

THIS FOURTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (“Agreement”), is entered into as of May 1, 2020, between AEROCENTURY CORP., a Delaware corporation (“Borrower”), MUFG UNION BANK, N.A., together with any other Lender hereunder from time to time (collectively, the “Lenders” and individually, a “Lender”), the Lenders, and MUFG UNION BANK, N.A., as administrative agent (in such capacity, “Agent”), effective as of the Closing Date, with reference to the following facts:

RECITALS

Borrower is in the business of purchasing and leasing aircraft and aircraft engines and equipment.

Pursuant to that certain Third Amended and Restated Loan and Security Agreement dated as of February, 2019, (as amended from time to time, the “Existing Credit Agreement”) by and among Borrower, the Lenders, and MUFG Union Bank, N.A., as administrative agent for the Lenders, the Lenders agreed to make available to Borrower a revolving credit facility (the “Existing Loan”), to be used for the purpose of refinancing existing revolving debt, acquiring aircraft and aircraft engines, and supporting Borrower’s working capital needs and general corporate purposes.

The Existing Credit Agreement has been amended by that (i) Forbearance Agreement dated as of October 28, 2019 (as amended, the “Prior Forbearance Agreement”), (ii) First Amendment of Forbearance Agreement and First Amendment to Credit Agreement dated as of November 13, 2019 (the “First Amendment”), (iii) Second Amendment to Credit Agreement and Consent for Sale of Collateral dated as of November 26, 2019 (the “Second Amendment”), (iv) Temporary Waiver and Consent and Third Amendment to Credit Agreement dated as of December 4, 2019 (the “Third Amendment”), (v) Second Amendment to Forbearance Agreement and Fourth Amendment to Credit Agreement dated as of December 12, 2019 (the “Fourth Amendment”), and (vi) Consent to Paycheck Protection Program dated as of April 16, 2020.

Defaults and Events of Default have occurred under the Existing Credit Agreement, which Defaults and Events of Default (collectively, the “Noticed Events of Default”) are specifically identified in the Notice of Default; Reservation of Rights Letters dated as of October 15, 2019, December 3, 2019, January 3, 2020, February 13, 2020, March 16, 2020 and April 7, 2020 and delivered by Agent to Borrower and its Subsidiary guarantors (the “Reservation of Rights Letters”) (such Noticed Events of Default other than that specified in the January 3, 2020 Reservation of Right Letter (which was subsequently cured), collectively, the “Specified Events of Default”).

A Forbearance Termination Event (as defined in the Prior Forbearance Agreement) occurred on December 30, 2019, thereby causing a Forbearance Termination Date (as defined in the Prior Forbearance Agreement) to occur on such date.

As of April 1, 2020, the aggregate principal amount outstanding of the Existing Loan is $83,514,823.64 (which amount does not take into account the capitalized interest for April 2020 to be added to the principal on May 1, 2020).

Additionally, Borrower and MUFG Bank, Ltd., as a Swap Contract Counterparty (“MUFG Bank”), entered into that ISDA 2002 Master Agreement dated as of March 12, 2019 with respect to certain Swap Contracts (the “MUFG Bank Swap Contracts”). Pursuant to the Existing Credit Agreement all of Borrower’s liability and obligations under the MUFG Bank Swap Contracts constitute Lender Hedging Obligations secured by the Collateral. On March 10, 2020, MUFG Bank delivered to Borrower a Notice of Default and Declaration of Early Termination Date of Swap Contracts (the “First ISDA Notice”), notifying Borrower of the election of MUFG Bank (as the nondefaulting party) to designate an Early Termination Date (as defined therein) as a result of an event of default under the ISDA Agreement and close out the transactions outstanding thereunder. On March 12, 2020, MUFG Bank provided Borrower Notice of Early Termination Amount Due dated as of March 12, 2020 (the “Second ISDA Notice” and, together with the First ISDA Notice, the “ISDA Notices”), notifying Borrower of Early Termination Amount (as defined therein) due in the amount of $3,075,267.66 (the “MUFG Bank Swap Termination Value”). Borrower’s obligations and liability to MUFG Bank as described in the ISDA Notices, including the obligation to pay such Early Termination Value, continue to be hereinafter secured by the Collateral.

Borrower has requested that Agent and Lenders amend and restate the Existing Credit Agreement in its entirety (without novation) to grant Borrower a temporary forbearance with respect to the Specified Events of Default referenced in Recital D above and NordLB Specified Event of Default (hereinafter defined), if any, and amend the Existing Credit Agreement pursuant to the terms hereof, including to convert the Existing Loan to a term loan, and make other amendments, all as set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

. As used in this Agreement, the following terms shall have the respective meanings set forth below:

“Account Control Agreement(s)” means any agreement entered into, in a form satisfactory to Agent, by and among Agent, Borrower or its Subsidiary and a depository bank or other institution in which Borrower or such Subsidiary maintains a deposit account, effective to grant “control” (as defined under the UCC) over such account to Agent.

“Account Debtor” means any Person who is obligated under an Account.

“Accounts” means all “accounts,” as such term is defined in the UCC, now owned or hereafter acquired by Borrower, including (a) all accounts receivable, payments and pre-payments under Leases, other receivables, book debts and other forms of obligations (other than forms of obligations evidenced by chattel paper, documents or instruments), whether arising out of goods sold or services rendered by it or from any other transaction (including any such obligations that may be characterized as an account or contract right under the UCC), (b) all purchase orders or receipts for goods or services, (c) all rights to any goods represented by any of the foregoing (including unpaid sellers’ rights of rescission, reclamation and stoppage in transit and rights to returned, reclaimed or repossessed goods), (d) all monies due or to become due to Borrower under all purchase orders and contracts for the sale of goods or the performance of services or both by Borrower or in connection with any other transaction (whether or not yet earned by performance on the part of Borrower) now or hereafter in existence, including the right to receive the proceeds of said purchase orders and contracts, and (e) all collateral security and guaranties of any kind, now or hereafter in existence, given by any Person with respect to any of the foregoing.

“Acquisition” means any transaction, or any series of related transactions, consummated after the Closing Date, by which Borrower and/or any of its Subsidiaries directly or indirectly (a) acquires any ongoing business or all or substantially all of the assets of any Person engaged in any ongoing business, whether through purchase of assets, merger or otherwise, (b) acquires control of securities of a Person engaged in an ongoing business representing more than 50% of the ordinary voting power for the election of directors or other governing position if the business affairs of such Person are managed by a board of directors or other governing body or (c) acquires control of more than 50% of the ownership interest in any partnership, joint venture, limited liability company, business trust or other Person engaged in an ongoing business that is not managed by a board of directors or other governing body.

“ACY 15129” means ACY SN 15129 LLC, a Delaware limited liability company.

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” means, with respect to any Person, another Person that, directly or indirectly, Controls, or is Controlled by or is under common Control with such other Person. For the purpose of this definition, “Control” or “Controlled” means the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.

“Agent” or “Administrative Agent” means MUFG Union Bank, N.A. when acting in its capacity as Agent under any of the Loan Documents, or any successor Agent.

“Agreement” means this Fourth Amended and Restated Loan and Security Agreement, as the same may, from time to time, be amended, supplemented, modified or restated.

“Aircraft” means each aircraft purchased by Borrower described in a Mortgage, together with any and all Parts (including Engines) which are either incorporated or installed in or attached to such aircraft’s airframe or required to be subject to the lien and security interest of such Mortgage.

“Aircraft 238” means the Bombardier Aircraft model Dash 8-311 bearing manufacturer’s serial number 238, along with two Engines installed thereon (currently identified as two (2) Pratt & Whitney Canada model PW123 aircraft engines bearing manufacturer’s serial numbers PCE-AE0160 and AE-0164.

“Air Nostrum 1 Aircraft” has the meaning assigned thereto in Section 6.25(c).

“Air Nostrum 1 Borrower” has the meaning assigned thereto in Section 6.25(c).

“Air Nostrum 2 Aircraft” has the meaning assigned thereto in Section 6.25(c).

“Air Nostrum 2 Borrower” has the meaning assigned thereto in Section 6.25(c).

“Air Nostrum Aircraft” has the meaning assigned thereto in Section 6.25(c).

“Air Nostrum Borrower” has the meaning assigned thereto in Section 6.25(c).

“Alternative Dispute Resolution Agreement” means one or more Alternative Dispute Resolution Agreement(s) executed by Agent, each Lender, Borrower and, if applicable, Subsidiary, in connection with the Loans.

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption.

“Applicable Base Rate” means the percentage as calculated in Section 2.2.1(a).

“Applicable Base Rate Cash Margin” means (a) with respect to the Initial Period, zero percent (0.00%), and (b) with respect to any other period after the end of the Initial Period, one percent (1.00%).

“Applicable Base Rate Margin” means, for any period, the sum of (a) the Applicable Base Rate Cash Margin for such period and (b) the Applicable Base Rate PIK Margin for such period.

“Applicable Base Rate PIK Margin” means (a) with respect to the Initial Period, five and a quarter percent (5.25%), and (b) with respect to any other period after the end of the Initial Period, four and a quarter percent (4.25%).

“Applicable Law” means, in respect of any Person, all provisions of constitutions, statutes, rules, regulations and orders of governmental bodies or regulatory agencies applicable to such Person, and all orders and decrees of all courts and arbitrators in proceedings or actions to which the Person in question is a party or by which it or its properties are bound.

“Appraisal” means (i) a desktop appraisal providing appraisal for base values, market values, maintenance adjusted base values, maintenance adjusted current market values, 180-day orderly liquidation values (for Off-Lease aircraft only) and lease-adjusted current market values, or (i) if a Default exists, such other type of appraisal (e.g., extended desktop, visual inspection) as shall be required by Agent, of an item of Equipment or Excluded Asset to determine the appraised value thereof, performed by an Appraiser retained by Agent on behalf of the Lenders.

“Appraiser” means ICF SH&E, Inc., AVITAS or any other independent appraiser selected by Agent.

“APU” means, whether or not installed on an airframe, the auxiliary power unit of the manufacture and model described in any Mortgage, together with any and all modules and Parts which are either incorporated or installed from time to time in or attached to such APU.

“Assets” means all of Borrower’s assets and property, whether now existing or owned or hereafter created or acquired, and wherever located, including, but not limited to:

all accounts, chattel paper (including tangible and electronic chattel paper), contract rights, deposit accounts, documents (including negotiable documents), equipment (including the Equipment and all accessions and additions thereto, including at any time all Propellers, APUs and Landing Gear, and all parts, components, equipment, instruments, appliances, avionics, radio and radar devices, cargo handling systems and loose equipment that are at such time incorporated or installed in or attached thereto or to an Aircraft or Engine), general intangibles (including payment intangibles and software), goods (including fixtures), instruments (including promissory notes), inventory (including all goods held for sale or lease or to be furnished under a contract of service, and including returns and repossessions), investment property (including securities and securities entitlements), leases, letter of credit rights, money, and all of Borrower’s Books and Records with respect to any of the foregoing, and the computers and equipment containing said Books and Records;

all common law and statutory copyrights and copyright registrations, applications for registration, now existing or hereafter arising, in the United States of America or in any foreign jurisdiction, obtained or to be obtained on or in connection with any of the forgoing, or any parts thereof or any underlying or component elements of any of the forgoing, together with the right to copyright and all rights to renew or extend such copyrights and the right (but not the obligation) of Agent to sue in its own name and/or in the name of the Borrower for past, present and future infringements of copyright;

all trademarks, service marks, trade names and service names and the goodwill associated therewith, together with the right to trademark and all rights to renew or extend such trademarks and the right (but not the obligation) of Agent to sue in its own name and/or in the name of the Borrower for past, present and future infringements of trademark;

all (i) patents and patent applications filed in the United States Patent and Trademark Office or any similar office of any foreign jurisdiction, and interests under patent license agreements, including, without limitation, the inventions and improvements described and claimed therein, (ii) licenses pertaining to any patent whether Borrower is licensor or licensee, (iii) income, royalties, damages, payments, accounts and accounts receivable now or hereafter due and/or payable under and with respect thereto, including, without limitation, damages and payments for past, present or future infringements thereof, (iv) right (but not the obligation) to sue in the name of Borrower and/or in the name of Agent for past, present and future infringements thereof, (v) rights corresponding thereto throughout the world in all jurisdictions in which such patents have been issued or applied for, and (vi) reissues, divisions, continuations, renewals, extensions and continuations-in-part with respect to any of the foregoing; and

any and all cash proceeds and/or noncash proceeds of any of the foregoing, including, without limitation, insurance proceeds, and all supporting obligations and the security therefor or for any right to payment. All terms above have the meanings given to them in the New York Uniform Commercial Code, as amended or supplemented from time to time.

“Authorized Signatory” means (i) with respect to any Compliance Certificates delivered to Agent hereunder, (a) the chief executive officer, (b) the president, or (c) the chief financial officer or deputy financial officer, in each case of Borrower, and (ii) with respect to all other documents required to be executed by Borrower and delivered to Agent and/or Lenders hereunder, each of the foregoing persons or such other senior personnel of Borrower as may be duly authorized and designated in writing by Borrower to execute documents, agreements, and instruments on behalf of Borrower and to pledge Borrower’s real and personal property.

“Aviation Asset Disposition” has the meaning assigned thereto in Section 6.17. 

“Aviation Asset Requirements” means, at any time, an item of Equipment that meets the following criteria:

the purchase price of which has been paid in full and it is not subject to any other financing;

as to which an Equipment Owner or Lessor has good and marketable title, and on which Agent has a fully perfected first priority Lien and which is not subject to any other Lien other than Permitted Liens;

as to which, if owned by Owner Trustee, the Borrower shall have executed and delivered to Agent a Beneficial Interest Pledge Agreement covering, among other things, the Borrower’s Beneficial Interest in the owner trust which owns such item(s) of Equipment and/or Lease, and as to which the Owner Trustee shall have executed and delivered to Agent an (x) Owner Trustee Mortgage covering, among other things, such items of Equipment and/or Lease, (y) a Trust Agreement and (z) an Owner Trustee Guaranty;

as to which the Equipment Owner or Lessor shall have executed and delivered to Agent and/or filed (i) a Mortgage covering, among other things, such items of Equipment and/or Lease and (ii) the other documentation required in respect of Equipment;

with respect to items of Equipment, it has not suffered an Event of Loss, it is being used solely for lawful purposes and in the ordinary course of business of the Equipment Owner;

in the case of Equipment subject to Lease, it is insured against loss by either the Equipment Owner or the Lessee in accordance with this Agreement and industry practice; and

the requirements set forth in Sections 4.1.2 and 4.1.3.

“Aviation Authority” means the FAA, the Joint Airworthiness Authorities of the European Union /European Aviation Safety Agency and/or any other Governmental Authority which, from time to time, has control or supervision of civil aviation or has jurisdiction over the airworthiness, operation and/or maintenance of an item of Equipment.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.

“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank Account Report” has the meaning assigned thereto in Section 8.7.

“Bankruptcy Code” means the Bankruptcy Code (11 U.S.C. Sections 101 et seq.).

“Base Rate” means the highest of (i) the rate of interest most recently announced by Agent as to its U.S. dollar “Reference Rate”, (ii) the Federal Funds Rate plus one-half of one percent (0.50%); and (iii) three and a quarter percent (3.25%).

“Base Rate Interest Payment Date” shall have the meaning assigned thereto in Section 2.2.1(a)(i).

“Base Rate Loan” means a Term Loan made pursuant to this Agreement.

“Beneficial Interest” means a beneficial interest in a trust which owns one or more items of Equipment.

“Beneficial Interest Pledge Agreement” means a Beneficial Interest Pledge Agreement, to be entered into among Borrower, Owner Trustee, and Agent, whereby Borrower pledges to Agent, as security for certain obligations under this Agreement, all of the beneficial interest of Borrower, as beneficial owner under a particular Trust Agreement.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership or control as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Books and Records” means all books, records, board minutes, contracts, licenses, insurance policies, environmental audits, business plans, files, accounting books and records, Financial Statements (actual and pro forma), and filings with Governmental Authorities.

“Borrower” has the meaning assigned thereto in the introductory paragraph hereto.

“Business Day” means any day that is not a Saturday, Sunday, or other day on which banks in the State of California are authorized or required to close.

“Cape Town Convention” means the official English language texts of the “Convention on International Interests in Mobile Equipment” and the “Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment”, both of which were signed in Cape Town, South Africa on November 16, 2001, and including the Regulations for the International Registry and the Procedures for the International Registry, as promulgated thereunder.

“Cape Town Eligible Lease” means those certain Leases which create International Interests under the Cape Town Convention.

“Capital Lease Obligations” means all monetary obligations of a Person under any leasing or similar arrangement which, in accordance with GAAP, is classified as a capital lease.

“CARES Act” means the Coronavirus Aid, Relief, and Economic Security Act, H.R. 748.

“Cash” means, when used in connection with any Person, all monetary and non-monetary items owned by that Person that are treated as cash in accordance with GAAP, consistently applied.

“Cash Equivalents” means, when used in connection with any Person, that Person’s Investments in:

Government Securities due within one year after the date of the making of the Investment;

readily marketable direct obligations of any State of the United States of America or any political subdivision of any such State or any public agency or instrumentality thereof given on the date of such Investment a credit rating of at least AA by Moody’s Investors Service, Inc. or AA by Standard & Poor’s Rating Group (a division of McGraw Hill, Inc.), in each case due within one year from the making of the Investment;

certificates of deposit issued by, bank deposits in, Eurodollar deposits through, bankers’ acceptances of, and repurchase agreements covering Government Securities executed by Lender or any bank incorporated under the Applicable Law of the United States of America, any State thereof or the District of Columbia and having on the date of such Investment combined capital, surplus and undivided profits of at least $250,000,000, or total assets of at least $5,000,000,000, in each case due within one year after the date of the making of the Investment;

certificates of deposit issued by, bank deposits in, Eurodollar deposits through, bankers’ acceptances of, and repurchase agreements covering Government Securities executed by Lender or any branch or office located in the United States of America of a bank incorporated under the Applicable Law of any jurisdiction outside the United States of America having on the date of such Investment combined capital, surplus and undivided profits of at least $500,000,000, or total assets of at least $15,000,000,000, in each case due within one year after the date of the making of the Investment;

repurchase agreements covering Government Securities executed by a broker or dealer registered under Section 15(b) of the Securities Exchange Act of 1934, as amended, having on the date of the Investment capital of at least $50,000,000, due within ninety (90) days after the date of the making of the Investment; provided that the maker of the Investment receives written confirmation of the transfer to it of record ownership of the Government Securities on the books of a “primary dealer” in such Government Securities or on the books of such registered broker or dealer, as soon as practicable after the making of the Investment;

readily marketable commercial paper or other debt securities issued by corporations doing business in and incorporated under the Applicable Law of the United States of America or any State thereof or of any corporation that is the holding company for a bank described in clause (c) or (d) above given on the date of such Investment a credit rating of at least P 1 by Moody’s Investors Service, Inc. or A 1 by Standard & Poor’s Rating Group (a division of McGraw Hill, Inc.), in each case due within one year after the date of the making of the Investment;

“money market preferred stock” issued by a corporation incorporated under the Applicable Law of the United States of America or any State thereof (i) given on the date of such Investment a credit rating of at least AA by Moody’s Investors Service, Inc. and AA by Standard & Poor’s Rating Group (a division of McGraw Hill, Inc.), in each case having an investment period not exceeding fifty (50) days or (ii) to the extent that investors therein have the benefit of a standby letter of credit issued by Lender or a bank described in clauses (c) or (d) above; provided that (y) the amount of all such Investments issued by the same issuer does not exceed $5,000,000 and (z) the aggregate amount of all such Investments does not exceed $15,000,000;

a readily redeemable “money market mutual fund” sponsored by a bank described in clause (c) or (d) hereof, or a registered broker or dealer described in clause (e) hereof, that has and maintains an investment policy limiting its investments primarily to instruments of the types described in clauses (a) through (g) hereof and given on the date of such Investment a credit rating of at least AA by Moody’s Investors Service, Inc. and AA by Standard & Poor’s Rating Group (a division of McGraw Hill, Inc.); and

corporate notes or bonds having an original term to maturity of not more than one year issued by a corporation incorporated under the Applicable Law of the United States of America, or a participation interest therein; provided that (i) commercial paper issued by such corporation is given on the date of such Investment a credit rating of at least AA by Moody’s Investors Service, Inc. and AA by Standard & Poor’s Rating Group (a division of McGraw Hill, Inc.), (ii) the amount of all such Investments issued by the same issuer does not exceed $5,000,000 and (iii) the aggregate amount of all such Investments does not exceed $15,000,000.

“Cash Interest” means the Cash portion of the interest that is due and payable pursuant to the terms hereof.

“Cash Flow Budget” has the meaning assigned thereto in Section 8.2.

“Cash Flow Variance Report” has the meaning assigned thereto in Section 8.2.

“Change in Control” means (a) any transaction or series of related transactions in which any Unrelated Person or two or more Unrelated Persons acting in concert acquire beneficial ownership (within the meaning of Rule 13d 3(a)(1) under the Securities Exchange Act of 1934, as amended), directly or indirectly, of 20% or more of the ownership interests in Borrower, (b) Borrower consolidates with or merges into another Person or conveys, transfers or leases its properties and assets substantially as an entirety to any Person or any Person consolidates with or merges into Borrower, in either event pursuant to a transaction in which the ownership interests in Borrower are changed into or exchanged for cash, securities or other property, with the effect that any Unrelated Person becomes the beneficial owner, directly or indirectly, of 20% or more of ownership interests in Borrower or that the Persons who were the holders of ownership interests in Borrower immediately prior to the transaction hold less than 80% of the interests of the surviving entity after the transaction, (c) any change in an executive officer of Borrower (provided no change in control shall occur upon the death or incapacitation of an executive officer), or (d) a “change in control” as defined in any document governing Indebtedness of Borrower which gives the holders of such Indebtedness the right to accelerate or otherwise require payment of such Indebtedness prior to the maturity date thereof. For purposes of the foregoing, the term “Unrelated Person” means any Person other than (i) any Affiliate of any thereof and members of the immediate family of any thereof, (ii) a Subsidiary of Borrower or (iii) an employee stock ownership plan or other employee benefit plan covering the employees of Borrower and its Subsidiaries.

“Charges” means all Federal, state, county, city, municipal, local, foreign or other governmental Taxes (including Taxes owed to PBGC at the time due and payable), levies, assessments, charges, liens, and all additional charges, interest, penalties, expenses, claims or encumbrances upon or relating to (a) the Collateral, (b) the Obligations, (c) the employees, payroll, income or gross receipts of Borrower, (d) the ownership or use of any assets by Borrower, or (e) any other aspect of Borrower’s business.

“Chattel Paper” means all “chattel paper,” as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located, but excluding Leases.

“Claim” means any and all suits, actions, or proceedings in any court or forum, at law, in equity or otherwise; costs, fines, deficiencies, or penalties; asserted claims or demands by any Person; arbitration demands, proceedings or awards; damages, losses, liabilities and expenses (including reasonable attorneys’ fees and disbursements and other costs of collection, defense or appeal); enforcement of rights and remedies; or criminal, civil or regulatory investigations.

“Closing Date” means the time and Business Day on which the conditions set forth in Section 4.1 are satisfied or waived.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

“Collateral” means all of the collateral covered by the Collateral Documents.

“Collateral Documents” means, collectively, all of those documents set forth in Section 3.1, including without limitation the following and any agreements, documents, and instruments executed, filed or registered in connection therewith: this Agreement, to the extent it constitutes a security agreement, the Mortgage, the Owner Trustee Mortgage, any Security Agreement, UCC financing statements, a Beneficial Interest Pledge Agreement (if any), an Owner Trustee Guaranty (if any), and such other agreements, pledges and security instruments, and all amendments thereto, instruments and documents as Agent may reasonably require pursuant to this Agreement.

“Commitment Assignment and Acceptance” means a commitment assignment and acceptance substantially in the form of Exhibit D.

“Compliance Certificate” means a Compliance Certificate in the form attached hereto as Exhibit C signed by an Authorized Signatory.

“Contract” means, individually and collectively, all contracts, leases, undertakings, and agreements (other than rights evidenced by Chattel Paper, Documents or Instruments) in or under which any Person may now or hereafter have any right, title or interest, including any agreement relating to the terms of payment or the terms of performance of any Account.

“Contracting State” shall have the meaning given to such term under Article 4 of the Cape Town Convention.

“Contractual Obligation” means, as to any Person, any provision of any outstanding security issued by that Person or of any material agreement, instrument or undertaking to which that Person is a party or by which it or any of its property is bound.

“Credit Facility” means the term loan provided hereunder in respect of the Term Loans.

“Custodial Agreement” means an agreement pursuant to which a Person is acting as custodian for Borrower with respect to original “chattel paper” or such other documents as may be addressed under such agreement.

“Custodian” means any custodian under the Custodial Agreement.

“Debt Instrument” has the meaning assigned thereto in Section 9.1.14.

“Debtor Relief Laws” means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.

“Default” means any event which, with the passage of time or notice or both, would, unless cured or waived, become an Event of Default.

“Defaulting Lender” means a Lender which (a) fails to fund any amounts due from such Lender to Agent, another Lender or Borrower under this Agreement within one (1) Business Day following written notice by the Agent of such failure to fund, unless such Lender notifies the Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, provided such Lender shall cease to be a “Defaulting Lender” immediately upon the cure of such failure to fund, (b) has notified the Borrower or the Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), or (c) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under the Bankruptcy Code or any other similar Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity or (iii) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (c) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender upon delivery of written notice of such determination to the Borrower and each Lender.

“Default Rate” means, for the Initial Period or any period thereafter, a per annum default rate equal to the Applicable Base Rate for such period, plus two percent (2.0%) (whereby the Applicable Base Rate Cash Margin is increased by 2.0%).

“Deferred Interest” has the meaning assigned thereto in Section 2.2.1(d).

“Disposition” has the meaning assigned thereto in Section 7.5.

“Dispute” has the meaning assigned thereto in Section 11.1.

“Distribution” means, with respect to any shares of capital stock or membership interests or any warrant or option to purchase an equity security or other equity security issued by a Person, (a) the retirement, redemption, purchase or other acquisition for Cash or for Property by such Person of any such security, (b) the declaration or (without duplication) payment by such Person of any dividend in Cash or in Property on or with respect to any such security, (c) any Investment by such Person in the holder of 5% or more of any such security if a purpose of such Investment is to avoid characterization of the transaction as a Distribution and (d) any other payment in Cash or Property by such Person constituting a distribution under Applicable Law with respect to such security.

“Documents” means all “documents,” as such term is defined in the UCC, now owned or hereafter acquired by any Person, wherever located, including all bills of lading, dock warrants, dock receipts, warehouse receipts, and other documents of title, whether negotiable or non-negotiable.

“Dollars” means lawful currency of the United States.

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Electronic Transmission” shall mean each document, instruction, authorization, file, information and any other communication transmitted, posted or otherwise made or communicated by e-mail or E-Fax, or otherwise to or from an E-System or other equivalent service.

“Eligible Assignee” means (a) another Lender (other than any Defaulting Lender), (b) with respect to any Lender, any Affiliate of that Lender (other than any Defaulting Lender), (c) any commercial bank having total assets of $1,000,000,000 or more, (d) any (i) savings bank, savings and loan association or similar financial institution or (ii) insurance company engaged in the business of writing insurance which, in either case (A) has total assets of $1,000,000,000 or more, (B) is engaged in the business of lending money and extending credit under Credit Facility substantially similar to those extended under this Agreement and (C) is operationally and procedurally able to meet the obligations of a Lender hereunder to the same degree as a commercial bank and (e) any other financial institution (including a mutual fund or other fund) having total assets of $1,000,000,000 or more which meets the requirements set forth in subclauses (B) and (C) of clause (d) above; provided that each Eligible Assignee must either (aa) be organized under the laws of the United States of America, any State thereof or the District of Columbia or (bb) be organized under the laws of the Cayman Islands or any country which is a member of the Organization for Economic Cooperation and Development, or a political subdivision of such a country, and (i) act hereunder through a branch, agency or funding office located in the United States of America and (ii) be exempt from withholding of Tax on interest and deliver the documents related thereto pursuant to Section 12.17.

“Eligible Lease” shall mean a lease for Equipment to an unaffiliated Person in which:

(a)           Borrower is the lessor of the Equipment;

(b)           the lease arose in the ordinary course of business of Borrower;

(c)           the Equipment has been delivered to the Lessee (subject to the last sentence of this definition) and is currently subject to the lease;

(d)           neither the lease nor the Equipment is subject to any currently outstanding assignment, claim, lien, security interest or other limitation on the absolute title of Borrower;

(e)           the lease payments and maintenance reserves are not more than ten (10) days past due with respect to any payment required thereby (for clarity, the requirement in this clause (n) does not apply to the Specified Leases);

(f)           the lease is freely assignable by the Lessor (with any notices or consents required in connection therewith having been previously obtained, and subject to any lease requirements concerning the net worth of the assignee or restriction regarding assignment to a lessee’s competitor) and prohibits assignment in whole or in part by the Lessee thereof without the prior written consent of Lessor;

(g)           the lease and the Equipment being leased constitute Collateral;

(h)           the remaining lease term at the time of entry into the pool of the Collateral is for a period of ten years or less;

(i)           it is a triple net contract and with respect to which the Lessee thereunder is responsible for all payments in connection therewith, including, but not limited to, payment of all Taxes (including sales and use Taxes), insurance and maintenance expenses (or payment of maintenance reserves in lieu thereof) and all other expenses pertaining to the assets subject thereto;

it is a non-cancelable lease and provides that the Lessee’s obligations thereunder are absolute and unconditional and which obligations are not, either pursuant to the terms of such Lease or otherwise, subject to contingencies, defense, deduction, set-off, reduction, claim or counterclaim of any kind whatsoever and as to which no defenses, deductions, set offs, reductions, claims or counterclaims exist or have been asserted by the Lessee or anyone on its behalf and the Borrower has no obligations thereunder, including, without limitation, any service or maintenance of the related Equipment, other than the obligation to sell, lease or finance the Equipment and grant a covenant of quiet enjoyment to such Lessee; provided, however, that (i) in the case of leases with terms of less than twelve months in which Borrower may be responsible for maintenance and (ii) Borrower may assume the obligation to pay some or all of the cost of engine overhaul, airworthiness directives or manufacturer or government ordered modifications required during the term of the Lease, so long as the Lease states that such obligation is solely that of Borrower and imposes no obligation on the Lenders, in their capacity as lenders to Borrower, and Lessee’s only remedy for breach of the obligation is an independent action against Borrower as Lessor, and Lessee waives any and all right to offset such obligation against lease payments owed Borrower;

the Lessee is not a resident of, and the Equipment will not be subject to the laws of any, foreign jurisdiction in which, in the sole determination of Agent, the ability of Agent to perfect a first priority security interest in the Equipment is unsatisfactory or the ability of Agent to foreclose upon the Equipment and receive possession to or sell said Equipment is unsatisfactory;

with respect to which the Borrower’s Books and Records are accurate, complete and genuine;

it requires the Lessee to comply with all maintenance, return, alteration, replacement, pooling and sublease conditions as typically found in leases for similar types of aircraft, engines or equipment and as necessary to maintain at all times the airworthiness certification and serviceability status of the related Equipment pursuant to all applicable governmental and regulatory requirements;

it requires the Lessee to provide liability insurance, all risk ground and flight coverage for damage or loss of the related Equipment, and war risk insurance (if applicable), and with respect to which Agent is named as loss payee;

it requires the Lessee to provide confiscation and expropriation insurance, with deductibles that are acceptable to Agent, for Equipment operated (x) on routes with respect to which it is customary for air carriers flying comparable routes to carry such insurance or (y) in any area designated by companies providing such coverage as a recognized or threatened war zone or area of hostilities or an area where there is a substantial risk of confiscation or expropriation, unless Agent has confirmed in writing to the Borrower that, based on Agent’s assessment of the credit quality of the Lessee and Lessee’s ability to self-insure against such risk and Agent’s assessment of the magnitude of the risk of such loss based on its conclusion regarding the government having jurisdiction over the collateral, such insurance is not necessary;

the Lessee is not based in, and the Lease requires that the related Equipment not be operated in, unless appropriate insurance as determined by Agent is obtained, any country or any jurisdiction, that would not be covered by or would void any insurance coverage required hereunder, or any country which is subject to any United States, the European Union or United Nations sanctions or the lease to which would violate United States law, rule or regulation or other restrictions;

the sole original of which is in the possession of Agent or Custodian, or, with respect to chattel paper, if there shall be more than one original, then the sole counterpart which shall constitute “chattel paper” for purposes of perfection by possession under the UCC shall be in the possession of Agent or its designee; and

the Lessee under which is not a Subsidiary, employee, agent or other Affiliate of the Borrower;

provided, that all of the leases set forth on Schedule 1.1b as of the Closing Date are Eligible Leases except as otherwise provided on such Schedule.

“Enforcement Actions” means the exercise by Agent and the Lenders at any time of their rights and remedies and to commence enforcement, litigation and collection actions under the Existing Credit Agreement, this Agreement, the other Loan Documents and applicable law, including to set off funds and to declare to be immediately due and payable the principal amount of the Loans now outstanding, all accrued interest, fees and the other obligations of Borrower accrued under the Existing Credit Agreement, this Agreement and the other Loan Documents, other than as described in the last sentence of Section 9.2.1 of the Existing Credit Agreement and this Agreement commencing with the word “provided” (but, for clarity, the right to apply the Default Rate to the Loans is excluded from the definition of Enforcement Action).

“Environmental Laws” means any and all federal, state, local, and foreign statutes, Laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions, including all common law, relating to pollution or the protection of health, safety or the environment or the release of any materials into the environment, including those related to Hazardous Materials, air emissions, discharges to waste or public systems and health and safety matters

“Environmental Liabilities and Costs” means all liabilities, obligations, responsibilities, remedial actions, removal costs, losses, damages, costs and expenses that relate to any health or safety condition regulated under any Environmental Law or in connection with any other environmental matter or Release, threatened Release, or the presence of any Hazardous Material.

“Engine” means each engine described in any Mortgage (each of which has 550 or more rated takeoff horsepower or the equivalent of such horsepower), together with any and all Parts which are either incorporated or installed in or attached to such engine or required to be subject to the lien and security interest of such Mortgage.

“Equipment” means new and used regional Aircraft, including the attached Engines thereto and new and used Leased Spare Engines, set forth in Schedule 1.1c except as otherwise provided therein.

“Equipment Owner” means the Borrower or Owner Trustee.

“ERISA” means the Employee Retirement Income Security Act of 1974 and the regulations thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated) which is a member of a “controlled group of corporations,” a group of trades or businesses under “common control,” or an “affiliated service group,” which includes Borrower within the meaning of Sections 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986.

“E-System” shall mean any electronic system and any other internet or extranet-based site, whether such electronic system is owned, operated, hosted or utilized by the Agent, any of its Affiliates or any other Person, providing for access to data protected by passcodes or other security system.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

“Event of Default” means any of the events specified in Section 9.1 and, unless otherwise specifically noted, shall include the Specified Events of Default.

“Event of Loss” means:

if an item of Equipment is not subject to a Lease, any of the following events:

the actual or constructive total loss of such item of Equipment or the agreed or compromised total loss of such item of Equipment;

its destruction, damage beyond economic repair or being rendered permanently unfit for normal use for any reason whatsoever; and

any capture, condemnation, confiscation, requisition, purchase, seizure or forfeiture of, or any taking for use or of title to, such item of Equipment, in each case, that shall have resulted in the loss of possession or title of such item of Equipment by the Lessor (other than a requisition for use for not more than one hundred eighty (180) days by the United States Government), or

if an item of Equipment is subject to a Lease, any events defined as an “Event of Loss,” “Casualty Occurrence” or similar term in such Lease.

For purposes of this Agreement, the date that an Event of Loss is deemed to have occurred shall be as follows:

if an item of Equipment is not subject to a Lease,

(x) in the event of an actual loss of such item of Equipment, on the date of such loss;

(y) in the event of damage which results in a constructive or compromised or arranged total loss of such item of Equipment, on the date of the event giving rise to such damage;

(z) in the case of an Event of Loss referred to in clause (a)(ii) above, on the date of the occurrence of such event, or

if an item of Equipment is subject to a Lease, at such times as are set forth in such Lease of such item of Equipment for the foregoing events.

In no event will the Event of Loss date be later than the earlier to occur of (i) the Borrower’s or Agent’s (as applicable) receipt of insurance proceeds in respect of such Equipment or (ii) the date that is ninety (90) days after the date of such loss, damage or destruction.

“Excess Cash” means, as the date of determination, if a positive number, the amount of the Unrestricted Cash as of such date minus $1,000,000.00.

“Excess Proceeds” has the meaning set forth in Section 6.25.

“Excluded Assets” means the Aircraft and associated Engines set forth on Schedule 1.1d while pledged as collateral for the Permitted Excluded Subsidiary Financing.

“Excluded Subsidiaries” means, so long as each such Person’s debt under the Excluded Subsidiary Facility is outstanding, ACY SN 19002 Limited, a company organized under the laws of the United Kingdom, ACY SN 19003 Limited, a company organized under the laws of the United Kingdom, and ACY E-175 LLC, a Delaware limited liability company.

“Excluded Subsidiary Facility” means a term loan facility extended by NordLB to one or more Excluded Subsidiaries in the aggregate current principal amount of $30,033,489, secured by the Excluded Assets.

“Excluded Swap Obligation” means, with respect to any Guarantor, (x) as it relates to all or a portion of any Swap Obligation if, and to the extent that, such Swap Obligation (or any guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the guaranty of such Guarantor becomes effective with respect to such Swap Obligation or (y) as it relates to all or a portion of the grant by such Guarantor of a security interest, any Swap Obligation if, and to the extent that, such Swap Obligation (or such security interest in respect thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the security interest of such Guarantor becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a Master Agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such guaranty or security interest is or becomes illegal.

"Excluded Taxes" means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. Federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Term Loan Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Term Loan Commitment or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender acquired the applicable interest in a Loan or Term Loan Commitment or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient's failure to comply with Section 2.17(f), and (d) any U.S. Federal withholding Taxes imposed under FATCA.

“Exclusivity Milestone” has the meaning assigned thereto in Section 6.22(b).

“Existing Credit Agreement” has the meaning assigned thereto in the Recitals.

“Existing Loan” has the meaning assigned thereto in Recital B.

“Existing Mortgage” means that certain Mortgage and Security Agreement dated as of April 28, 2010, as amended and restated by that Amended and Restated Mortgage and Security Agreement dated as of June 17, 2013, Second Amended and Restated Mortgage and Security Agreement dated as of May 30, 2014, Third Amended and Restated Mortgage and Security Agreement dated as of February 19, 2019, made by Borrower in favor of Agent, and each mortgage supplement for each of the foregoing.

“FAA” means the Federal Aviation Administration or any Governmental Authority succeeding to the functions thereof.

"FATCA" means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.

“Federal Funds Rate” means, as of any date of determination, the rate set forth in the weekly statistical release designated as H.15(519), or any successor publication, published by the Federal Reserve Board (including any such successor, “H.15(519)”) for such date opposite the caption “Federal Funds (Effective)”. If for any relevant date such rate is not yet published in H.15(519), the rate for such date will be the rate set forth in the daily statistical release designated as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or any successor publication, published by the Federal Reserve Bank of New York (including any such successor, the “Composite 3:30 p.m. Quotation”) for such date under the caption “Federal Funds Effective Rate”. If on any relevant date the appropriate rate for such date is not yet published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such date will be the arithmetic mean of the rates for the last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New York City time) on that date by each of three leading brokers of Federal funds transactions in New York City selected by Agent. For purposes of this Agreement, any change in the Base Rate due to a change in the Federal Funds Rate shall be effective as of the opening of business on the effective date of such change.

“Field Examination” means an inspection and/or audit of the Borrower, which Field Examination may be conducted at Agent’s direction by Agent and any of its officers, employees, and agents. The Field Examination may include, without limitation, the review, audit, Appraisal, physical verification, and such other reviews of the Equipment and Borrower’s Books and Records in connection therewith as shall be deemed appropriate by Agent in its sole discretion.

“Financial Advisor/Consultant” has the meaning assigned thereto in Section 4.1.11.

“Financial Statements” means the income statement, balance sheet and statement of cash flows of Borrower and its Subsidiaries, internally prepared for each Fiscal Quarter and audited for each Fiscal Year, in each case prepared in accordance with GAAP including the notes and schedules thereto.

“First Amendment” has the meaning assigned thereto in Recital C.

“First ISDA Notice” has the meaning assigned thereto in Recital G.

“Fiscal Quarter” means any of the quarterly accounting periods of Borrower, specifically ending March 31, June 30, September 30, and December 31 of each year.

“Fiscal Year” means the twelve (12) month fiscal period of Borrower ending December 31 of each year. Subsequent changes of the Fiscal Year of Borrower shall not change the term “Fiscal Year” unless Agent shall consent in writing to such change.

"Forbearance Period" has the meaning assigned thereto in Section 16.2.1.

"Forbearance Termination Date" has the meaning assigned thereto in Section 16.2.1.

"Forbearance Termination Event" has the meaning assigned thereto in Section 16.2.1.

"Foreign Lender" means a Lender that is resident or organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.

“Fourth Amendment” has the meaning assigned thereto in Recital C.

“Funded Debt” shall mean, as of the last day of any Fiscal Quarter, all indebtedness, liabilities, and obligations for which Borrower has recourse liability, now existing or hereafter arising, for money borrowed by Borrower or a Subsidiary whether or not evidenced by any note, indenture, or agreement (including, without limitation, the Notes and any indebtedness for money borrowed from an Affiliate), as determined in accordance with GAAP, consistently applied.

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States, consistently applied.

“Governmental Authority” means (a) any international, foreign, federal, state, county or municipal government, or political subdivision thereof, (b) any governmental or quasi-governmental agency, authority, board, bureau, commission, department, instrumentality or public body, including any Aviation Authority, or (c) any court or administrative tribunal of competent jurisdiction.

“Government Securities” means readily marketable (a) direct full faith and credit obligations of the United States of America or obligations guaranteed by the full faith and credit of the United States of America and (b) obligations of an agency or instrumentality of, or corporation owned, controlled or sponsored by, the United States of America that are generally considered in the securities industry to be implicit obligations of the United States of America.

“Guaranteed Indebtedness” means, with respect to any Person, any obligation of such Person guaranteeing any indebtedness, lease, dividend, or other obligation (“primary obligations”) of any other Person (the “primary obligor”) in any manner, including any obligation or arrangement of such Person (a) to purchase or repurchase any such primary obligation, (b) to advance or supply funds (1) for the purchase or payment of any such primary obligation, or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency or any balance sheet condition of the primary obligor, (c) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation, or (d) to indemnify the owner of such primary obligation against loss in respect thereof. The amount of any “Guaranteed Indebtedness” at any time shall be deemed to be an amount equal to the lesser at such time of (x) the stated or determinable amount of the primary obligation in respect of which such Guaranteed Indebtedness is made, and (y) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Guaranteed Indebtedness; or, if not stated or determinable, the maximum reasonably anticipated liability (assuming full performance) in respect thereof.

“Guarantor” means the obligor under a Guaranty.

"Guaranty" means a Subsidiary Guaranty, Owner Trustee Guaranty or any other any other instrument of guaranty executed by any Person, in form and substance satisfactory to Agent, with respect to the Obligations; in each case either as originally executed or as it may from time to time be supplemented, modified, amended, extended or supplanted.

“Hazardous Material” means any substance, material or waste, the generation, handling, storage, treatment or disposal of which is regulated by any Governmental Authority, or forms the bases of liability now or hereafter under, any Environmental Law in any jurisdiction in which Borrower has owned, leased, or operated real property or disposed of hazardous materials.

“Immaterial Subsidiary” means (i) JFC, (ii) ACY 15129, and (iii) any such other Subsidiary as designated in writing by the Agent in its sole discretion, so long as such Subsidiary in any of the forgoing clauses (i) through (iii) does not (1) own any Assets; (2) have any liabilities or (3) generate any revenue, except that JFC may have the JFC Obligations and generate or hold enough funds to pay the JFC Obligations.

“Indebtedness” means: (a) with respect to Borrower, the Obligations; (b) all indebtedness of Borrower for borrowed money or for the deferred purchase price of property or services (including reimbursement and all other obligations with respect to surety bonds, letters of credit and bankers’ acceptances, whether or not matured); (c) all obligations evidenced by notes, bonds, debentures or similar instruments; (d) all indebtedness created or arising under any conditional sale or other title retention agreements with respect to property acquired by Borrower (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property); (e) all Capital Lease Obligations; (f) all Guaranteed Indebtedness; (g) all Indebtedness referred to in clauses (b), (c), (d), (e) or (f) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness; (h) all liabilities under Title IV of ERISA; (i) the net present value of the non-cancelable payments owed by Borrower as lessee under any lease which is qualified as an operating lease in accordance with GAAP for engines, aircraft and engine parts, using a 10% discount rate; (j) all Swap Obligations, and (k) all obligations with respect to deposits or maintenance reserves to the extent not supported by cash reserved specifically therefor; provided, however, that the term Indebtedness shall not include trade accounts payable within ninety (90) days of the date the respective goods are delivered or the respective services are rendered.

“Indemnified Person” means Agent and each Lender and each of the foregoing parties’ respective Affiliates and their officers, directors, employees, agents and advisors.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrower under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Initial Period” means the period from the Closing Date through June 30, 2020.

“Instruments” means all “instruments,” as such term is defined in the UCC, now owned or hereafter acquired by Borrower, wherever located, including all certificated securities and all notes and other evidences of indebtedness, other than instruments that constitute, or are a part of a group of writings that constitute, Chattel Paper.

“Intellectual Property” means all of the following now owned or hereafter acquired by Borrower: (a) patents, trademarks, trade dress, trade names, service marks, copyrights, trade secrets and all other intellectual property or Licenses thereof; and (b) all Proceeds of the foregoing.

“Interest Payment Date” means, as to any Base Rate Loan, the Base Rate Interest Payment Date for such Base Rate Loan.

“International Interest” shall have the meaning given to such term in the Cape Town Convention.

“International Registry” shall have the meaning given to such term in the Cape Town Convention.

“Investment” means, when used in connection with any Person, any investment by or of that Person, whether by means of purchase or other acquisition of stock or other securities of any other Person or by means of a loan, advance creating a debt, capital contribution, guaranty or other debt or equity participation or interest in any other Person, including any partnership and joint venture interests of such Person. The amount of any Investment shall be the amount actually invested (minus any return of capital with respect to such Investment which has actually been received in Cash or has been converted into Cash), without adjustment for subsequent increases or decreases in the value of such Investment.

“ISDA Notices” has the meaning assigned thereto in Recital G.

“JFC” means JetFleet Canada, a company organized under the laws of Canada, which is a Subsidiary of JMC.

“JFC Bank Account” means the bank account in the name of JFC in Canada as long as it does not, at any one time, hold funds in excess of the amount necessary to pay the JFC Obligations.

“JFC Obligations” means ordinary course obligations of JFC for (i) one (1) technical employee employed by it as of the Closing Date and while the employment thereof continues thereafter, (ii) other minimal cost related to maintaining the JFC Bank Account and tax filing and reporting obligations, and (iii) such other de minimis expenses necessary to maintain its corporate existence.

“JHC” means JetFleet Holding Corp., a California corporation.

“JMC” means JetFleet Management Corp., a California corporation.

“JMC Management Agreement” means that certain Second Amended and Restated Management Agreement between Borrower and JMC entered into as of August 17, 2015, as amended, or any successor agreement thereto.

“JMC Subordination Agreement” means that certain Amended and Restated Subordination Agreement (Management Agreement), dated as of December 20, 2017, entered into by and among Borrower, JMC and Agent with respect to the JMC Management Agreement, as such agreement may be amended or restated from time to time.

“Landing Gear” means, whether or not installed on an airframe, each landing gear, (nose gear and main gear), together with any and all modules and Parts which are either incorporated or installed from time to time in or attached to such Landing Gear.

“Late Payments” has the meaning assigned thereto in Section 2.5.

“Lease” means, with respect to an item of Equipment, any written lease agreement, general terms agreement other similar arrangement, as may be in effect between a Lessor, including an Equipment Owner, and a Lessee, as such agreement or arrangement may be amended, modified, extended, supplemented, assigned or novated from time to time in accordance with the terms thereof and the Loan Documents.

“Lease Event of Default” means, for any Lease other than the Leases as of the Closing Date with Silverstone Air Services, Skyward Express Limited and Croatia Airlines of Aircraft bearing manufacturer’s serial numbers 406, 407, 4205 and 4211 (the “Specified Leases”), respectively, the occurrence of any of the following:

(a)           The termination of such Lease prior to the date such Lease is scheduled to expire in accordance with its terms;

(b)           A default by the Lessee under such Lease in the payment of any installment of rent or a maintenance reserve amount that continues for ten (10) days or more.

(b)           A default under such Lease other than that described in clause (b) above which, through the passage of time or otherwise, has become an “event of default” (however denominated) under such Lease that gives rise to the right to terminate such Lease.

(d)           Any amendment of such Lease not in compliance with Section 7.21 hereof.

“Leased Spare Engine” means an Engine that is not attached to an airframe and leased by Lessor to Lessee as a standalone engine for installation on an airframe or as a spare.

“Lender” means each Lender named in Schedule A and each other party that may be named a “Lender” under this Agreement.

“Lender Hedging Obligations” means all liability and obligations arising from time to time pursuant to the Swap Contracts (including the Swap Termination Value thereof) entered into between Borrower and a Swap Contract Counterparty in connection with the Existing Loan and, if approved in writing by Agent in its sole and absolute direction, the Term Loans; provided that, with respect to any Swap Contract for the Term Loans, if such Swap Contract Counterparty ceases to be the Agent, a Lender hereunder or an Affiliate of either of them, Lender Hedging Obligations shall only include such obligations to the extent arising from transactions entered into at the time such Swap Contract Counterparty was the Agent, a Lender hereunder or an Affiliate of either of them pursuant to any Swap Contract. For clarity, the Lender Hedging Obligations shall be deemed to include MUFG Bank Lender Hedging Obligations.

“Lenders’ Consultant” the financial advisor or consultant retained by or on behalf of Agent and/or the Lenders in connection with their respective rights under the Loan Documents.

“Lessee” means the lessee of Equipment subject to a Lease.

“Lessee Letter” shall mean a letter in the form acceptable to Agent signed by Borrower, as Lessor, directing the Lessee under the applicable Lease to make payments under such Lease as directed by Agent upon the election of the Requisite Lenders.

“Lessor” means any Equipment Owner party to a Lease as lessor.

“License” means any license under any written agreement now owned or hereafter acquired by Borrower granting the right to use any Intellectual Property or other license of rights or interests now held or hereafter acquired by Borrower.

“Lien” means, with respect to any property, any security deed, mortgage, deed to secure debt, deed of trust, lien, pledge, assignment, charge, security interest, title retention agreement, negative pledge, levy, execution, seizure, attachment, garnishment, or other encumbrance of any kind in respect of such property, whether or not choate, vested, or perfected.

“Loan Documents” means collectively, this Agreement, the Notes, any Guaranty, the Collateral Documents, and any and all other agreements (including subordination agreements), documents, or instruments (including financing statements) entered into in connection with the transactions contemplated by this Agreement, together with all alterations, amendments, changes, extensions, modifications, refinancings, refundings, renewals, replacements, restatements, or supplements, of or to any of the foregoing.

“Loans” means all loans and advances made by Lenders to or for the benefit of Borrower under this Agreement or under any of the Loan Documents.

“LOI” has the meaning assigned thereto in Section 6.22(a).

“Maintenance Expense Report” has the meaning assigned thereto in Section 8.3.

“Maintenance Reserve Balance” has the meaning assigned thereto in Section 8.5.

“Maintenance Reserve Liability Report” has the meaning assigned thereto in Section 8.5.

“Marketed Aircraft” shall mean the Aircraft bearing manufacturer serial numbers 15128, 15207 and 15215, respectively.

“Master Agreement” means Master Agreement as defined in the definition of “Swap Contract.”

“Material Adverse Effect” means a material adverse effect on (a) the business, property, assets, operations or condition (financial or otherwise) of Borrower, (b) the ability of Borrower to pay or perform in accordance with the terms of any of the Loan Documents taken as a whole, or (c) the rights and remedies of Agent or any Lender under any of the Loan Documents.

“Material Contracts” means those instruments, agreements and contracts set forth on Schedule 1.1e hereto, as such schedule shall be updated by the Borrower from time to time.

“Maturity Date” means March 31, 2021.

“Mortgage” means each Mortgage and Security Agreement (including the Existing Mortgage) and any mortgage supplement thereto or each such other security instrument required by Applicable Law, made by Borrower in favor of Agent as security for certain obligations under this Agreement.

“MUFG Bank” has the meaning assigned thereto in Recital G.

“MUFG Bank Lender Hedging Obligations” means the Lender Hedging Obligations of Borrower arising out of the MUFG Bank Swap Contracts, including the obligation to pay the MUFG Bank Swap Termination Value and the interest amount thereon as reflected in the Second ISDA Notice.

“MUFG Bank Swap Contracts” has the meaning assigned thereto in Recital G.

“MUFG Bank Swap Termination Value” has the meaning assigned thereto in Recital G.

“Negative Pledge” means a Contractual Obligation which contains a covenant binding on Borrower or any of its Subsidiaries that prohibits Liens on any of its Property, other than (a) any such covenant contained in a Contractual Obligation granting or relating to a particular Lien which affects only the Property that is the subject of such Lien; (b) any such covenant that does not apply to Liens securing the Obligations; and (c) customary permitted junior Liens to be agreed upon by Borrower and Lender.

“Net Cash Proceeds” means, with respect to any Aviation Asset Disposition, the gross cash proceeds received from such Aviation Asset Disposition, net of (i) transaction costs (consisting of customary commissions, reasonable legal fees, and expenses associated therewith) incurred in connection with such Aviation Asset Disposition and (ii) maintenance reserve liability and security deposit liability, in each case of Borrower, associated with such aircraft and due and payable as part of the closing of such Aviation Asset Disposition.

“Non-Recourse Debt” shall mean Indebtedness for which the remedy for nonpayment or non-performance of any obligation or any default in respect thereof is limited to specified collateral securing such indebtedness and in respect of which the Borrower is not subject to any personal liability except to the extent agreed to by Agent in its sole discretion.

“NordLB” means, individually or collectively (as the context may require), Norddeutsche Landesbank Girozentrale, New York Branch, any “participant” party thereto and the security trustee under the Excluded Subsidiary Facility (and such parties’ respective successors and assigns).

“NordLB Specified Event of Default” means any Event of Default arising from a default or event of default under the Excluded Subsidiary Facility excluding, however, (i) any such default or event of default if NordLB commences to exercise remedies (or any such remedies are exercised on behalf of NordLB) thereunder or (ii) an event of default arising from Section 4.02(g) of security agreement under the Excluded Subsidiary Facility that states as follows:

[4.02] (g) at any time either (i) the commencement of an involuntary case or other proceeding in respect of a Borrower Party under bankruptcy laws, as now constituted or hereafter amended, or any other applicable federal or state bankruptcy, insolvency or other similar law in England or the United States seeking the appointment of a receiver, liquidator, assignee, Irish law examiner, custodian, trustee, sequestrator (or similar official) of such Borrower Party or for all or substantially all of its property, or seeking the winding-up or liquidation of its affairs and the continuation of any such case or other proceeding undismissed and unstayed for a period of 30 consecutive days; or (ii) such commencement by such Borrower Party of a voluntary case or proceeding under bankruptcy laws, as now constituted or hereafter amended, or any other applicable bankruptcy, insolvency or other similar law in the United States or the consent by such Borrower Party to the appointment of or taking possession by a receiver, liquidator, examiner, assignee, trustee, custodian, sequestrator (or other similar official) of such Borrower Party for all or substantially all of its property, or the making by such Borrower Party of any assignment for the benefit of the creditors of such Borrower Party, or such Borrower Party shall take any action to authorize any of the foregoing; or (iii) such Borrower Party has or suffers to be appointed any examiner, administrator, administrative receiver, receiver, liquidator, trustee or similar officer of all or a substantial part of its assets and such appointment is not dismissed for a period of 30 consecutive days;

“Note” means any note, including any Term Note, executed and delivered by Borrower to any Lender, as applicable, under this Agreement, and “Notes” means collectively all such notes executed and delivered by Borrower to each Lender under this Agreement.

“Noticed Events of Default” has the meaning assigned thereto in Recital D.

“Obligations” means all (a)  loans, advances, debts, expenses reimbursements, fees, liabilities and obligations, for the performance of covenants, tasks or duties or for payment of monetary amounts (whether or not such performance is then required or contingent, or amounts are liquidated or determinable) owing by Borrower to any Lender or Agent of any kind or nature, present or future, whether or not evidenced by any note, agreement or other instrument, arising under or in connection with this Agreement or any of the other Loan Documents, and all covenants and duties regarding such amounts, and (b) the Lender Hedging Obligations. The term “Obligations” includes all principal, interest (including interest that accrues after the commencement of any case or proceeding under any Debtor Relief Law by or against Borrower or any Affiliate thereof), fees, Charges, expenses, reasonable attorneys’ fees and any other sum chargeable to Borrower under this Agreement or any of the other Loan Documents, and all principal and interest due in respect of the Loans; provided that Obligations of a Guarantor shall exclude any Excluded Swap Obligation of such Guarantor.

“Off-Lease” means when Equipment is either (i) not subject to a valid Lease or (ii) is subject to a valid Lease but where a required rent or reserve payment due from Lessee is ninety (90) days past due or the Lessee is otherwise in default thereunder.

"Other Connection Taxes" means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment.

“Owner Trustee” means bank or trust company reasonably satisfactory to Agent acting as trustee of an aircraft owner trust under a Trust Agreement with Borrower as the beneficiary.

“Owner Trustee Guaranty” means an Owner Trustee Guaranty made by Owner Trustee in favor of Agent, as security for certain obligations under this Agreement, and guaranteeing Owner Trustee’s performance of the obligations under the respective Owner Trustee Mortgage.

“Owner Trustee Mortgage” means a Mortgage and Security Agreement made by Owner Trustee in favor of Agent with respect to a Trust Agreement (in connection with certain Equipment), as security for certain obligations under this Agreement.

“Participant” has the meaning assigned thereto in Section 12.8.5.

“Participant Register” has the meaning assigned thereto in Section 12.8.5.

“Parts” means, at any time, all parts, components, equipment, instruments, appliances, avionics, radio and radar devices, cargo handling systems and loose equipment that are at such time incorporated or installed in or attached to an airframe, Engine, Propeller, APU or Landing Gear.

“Patriot Act” has the meaning assigned thereto in Section 1.5.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“Permitted Excluded Subsidiary Financing” means the financing provided to the Excluded Subsidiaries under the Excluded Subsidiary Facility, which is Non-Recourse Debt with respect to Borrower or to any Subsidiary other than Excluded Subsidiaries.

“Permitted Indebtedness” means, as applied to Borrower, (a) Indebtedness of Borrower under this Agreement and the Notes, (b) Indebtedness incurred in the ordinary course of Borrower’s business which is unsecured and does not constitute Funded Debt, (c) Indebtedness existing as of the Closing Date and included on Schedule 1.1f hereto, including the Permitted Excluded Subsidiary Financing and (d) the PPP Loan so long as the PPP Loan remains an unsecured Indebtedness, qualifies for loan forgiveness under the CARES Act pursuant to the PPP Loan Forgiveness Requirements within the time prescribed thereunder, and Borrower and Subsidiary Guarantors comply with Section 6.26.

“Permitted Liens” means, as applied to Borrower: (a) Liens securing Taxes (excluding any Lien imposed pursuant to any of the provisions of ERISA) or the claims of materialmen, mechanics, carriers, repairmen, warehousemen, or landlords or other like Liens, but which (1) have been bonded, or (2) which are being contested in good faith by appropriate proceedings and for which Borrower shall have set aside on its books adequate reserves with respect thereto in accordance with GAAP; (b) Liens consisting of deposits or pledges made in the ordinary course of business in connection with, or to secure payment of, obligations under worker’s compensation, unemployment insurance, or similar legislation; (c) Liens constituting encumbrances in the nature of zoning restrictions, easements, and rights of way or restrictions of record on use of real property which, in the reasonable judgment of Agent, do not materially detract from the value of such property or impair the use thereof in the business of Borrower; (d) Liens of record set forth in Schedule 1.1g; (e) Liens created under the Loan Documents; (f) the rights of any Lessee or sublessee under any Lease to utilize an any Collateral pursuant to the terms of a Lease; (g) Liens arising in connection with legal or equitable proceedings against Borrower, which Borrower is contesting with diligence and good faith and which Liens do not have a Material Adverse Effect; (h) liens in respect of personal property leases other than Leases, which, in the aggregate, are not substantial in amount and do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Borrower so as to cause a Material Adverse Effect; (i) [reserved]; (j) Liens securing Indebtedness that has since been repaid in full, which filings Borrower cannot independently terminate; (k) Liens arising out of judgments that do not constitute an Event of Default under this Agreement; (l) any Lien arising by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depository institution in the ordinary course of business; (m) Liens securing Capital Lease Obligations on assets subject to such leases provided that such capitalized leases are otherwise permitted under this Agreement; and (n) Liens arising from the following types of liabilities of a lessee or any other operator of an item of Equipment, so long as such liabilities are either not yet due or are being contested in good faith through appropriate proceedings that do not give rise to any reasonable likelihood of the sale, forfeiture or other loss of such item of Equipment, title thereto or Agent’s security interest therein or of criminal or unindemnified civil liability on the part of the Borrower, any Lender or any Agent and with respect to which the lessee maintains adequate reserves (in the reasonable judgment of the Borrower): (A) fees or charges of any airport or air navigation authority, (B) judgments, or (C) salvage or other rights of insurers; provided that none of the foregoing Liens would have priority over the security interest in favor of Agent under the Loan Documents.

“Permitted Rights of Others” means those Right of Others consisting of (a) an interest (other than a legal or equitable co ownership interest, an option or right to acquire a legal or equitable co ownership interest and any interest of a ground lessor under a ground lease), that does not materially impair the fair market value or use of Property for the purposes for which it is or may reasonably be expected to be held, (b) an option or right to acquire a Lien that would be a Permitted Lien, (c) the subordination of a lease or sublease in favor of a financing entity and (d) a license, or similar right, of or to Intellectual Property granted in the ordinary course of business.

“Person” means any individual or entity, including a trustee, sole proprietorship, partnership, limited partnership, limited liability partnership, joint venture, trust, unincorporated organization, association, corporation, limited liability company, institution, public benefit corporation, entity or government (whether Federal, state, county, city, municipal or otherwise, including any instrumentality, division, agency, body or department thereof).

“PIK Interest” means the payment-in-kind interest that is due and payable pursuant to the terms hereof on account of the Applicable Base Rate PIK Margin.

“Plan” means, with respect to Borrower or any of its Affiliates, at any time, an employee benefit plan, as defined in Section 3(3) of ERISA, which Borrower or any of its Affiliates maintains, contributes to or has an obligation to contribute to on behalf of participants who are or were employed by any of them.

“PPP Covered Period” means the period applicable under the CARES Act for the use of the proceeds of the PPP Loan for the PPP Loan to qualify for loan forgiveness.

“PPP Loan” unsecured Indebtedness in an aggregate principal amount not to exceed at any time outstanding $276,352 extended by a bank or other financial institution to JMC in the form of a Paycheck Protection Program loan under the CARES Act, guaranteed by the SBA. For clarity, the PPP Loan is not part of the Loans and is not extended under the Credit Facility and, to the extent the PPP Loan lender is a Lender under the Credit Facility, such lender is not extending the PPP Loan in its capacity as a Lender under the Credit Facility but in its separate capacity as the lender holding the debt with respect to the PPP Loan.

“PPP Loan Forgiveness Requirements” means the requirements under the CARES Act, as determined by the SBA pursuant to applicable regulations promulgated by the SBA from time to time, for the PPP Loan to be forgiven within the time prescribed thereunder.

“Pricing Debt” means, as of the date of determination, the aggregate principal Indebtedness under the Credit Facility then outstanding on such date.

“Prior Forbearance Agreement” has the meaning assigned thereto in Recital C.

“Proceeds” means “proceeds,” as such term is defined in the UCC and, in any event, shall include: (a) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to Borrower from time to time with respect to any Collateral; (b) any and all payments (in any form whatsoever) made or due and payable to Borrower from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of any Collateral by any governmental body, authority, bureau or agency (or any person acting under color of Governmental Authority); (c) any claim of Borrower against third parties for past, present or future infringement or dilution of any Intellectual Property or for injury to the goodwill associated with any Intellectual Property; (d) any recoveries by Borrower against third parties with respect to any litigation or dispute concerning any Collateral; and (e) any and all other amounts from time to time paid or payable under or in connection with any Collateral, upon disposition or otherwise.

“Propeller” means each propeller described in a Mortgage.

“Property” means any real property, personal property, or Intellectual Property owned, leased or operated by Borrower, Owner Trustee or any Subsidiary.

“Pro Rata Share” means, with respect to each Lender, the percentage of the Term Loan Commitment set forth opposite the name of that Lender on Schedule A, as such percentage may be increased or decreased pursuant to a Commitment Assignment and Acceptance executed in accordance with Section 12.7.2.

“Prospective International Interest” shall have the meaning given to such term in the Cape Town Convention.

"Recipient" means (a) Agent and (b) any Lender, as applicable.

“Register” has the meaning assigned thereto in Section 12.8.4.

“Reference Rate” means the variable per annum rate of interest most recently announced by Agent at its corporate headquarters as the “MUFG Union Bank, N.A. Reference Rate,” with the understanding that the “MUFG Union Bank, N.A. Reference Rate” is one of Agent’s index rates and merely serves as a basis upon which effective rates of interest are calculated for loans making reference thereto and may not be the lowest or best rate at which Agent calculates interest or extends credit. The Reference Rate shall be adjusted on the last Business Day of the calendar month of any change in the “MUFG Union Bank, N.A. Reference Rate.” The Reference Rate, as adjusted, shall constitute the Reference Rate on the date when such adjustment is made and shall continue as the applicable Reference Rate until further adjustment.

“Release” means, as to Borrower, any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, dumping, leaching or migration of Hazardous Materials in the indoor or outdoor environment by Borrower, including the movement of Hazardous Materials through or in the air, soil, surface water, ground water or property.

“Released Matters” has the meaning assigned thereto in Section 16.3.

“Released Parties” has the meaning assigned thereto in Section 16.3.

“Releasing Parties” has the meaning assigned thereto in Section 16.3.

“Requisite Lenders” means, as of the date of any determination and except as otherwise expressly set forth herein to be all the Lenders, the Lenders holding Notes evidencing in the aggregate 50.1% or more of the aggregate Indebtedness then evidenced by the Notes; provided that the Note held by any Defaulting Lender shall be excluded for purposes of making a determination of Requisite Lenders.

“Reservation of Rights Letters” has the meaning assigned thereto in Recital D.

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority

“Restricted Account” has the meaning assigned thereto in Section 2.18.

“Restricted Subsidiary” means (i) any Excluded Subsidiary and (ii) any Immaterial Subsidiary.

“Revised Transaction Letter” has the meaning assigned thereto in Section 6.22(b).

“Right of Others” means, as to any Property in which a Person has an interest, any legal or equitable right, title or other interest (other than a Lien) held by any other Person in that Property, and any option or right held by any other Person to acquire any such right, title or other interest in that Property, including any option or right to acquire a Lien; provided, however, that (a) no covenant restricting the use or disposition of Property of such Person contained in any Contractual Obligation of such Person and (b) no provision contained in a contract creating a right of payment or performance in favor of a Person that conditions, limits, restricts, diminishes, transfers or terminates such right shall be deemed to constitute a Right of Others.

“Sanctions” means sanctions administered or enforced from time to time by the U.S. government, including those administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control or any successor thereto (“OFAC”), the U.S. Department of Commerce, the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury or any government having jurisdiction over Borrower or one of its Subsidiaries.

“SBA” means the U.S. Small Business Administration.

“Schedule of Documents” means the schedule, including all appendices, exhibits or schedules thereto, listing certain documents and information to be delivered in connection with this Agreement and the other Loan Documents and the transactions contemplated hereunder and thereunder, substantially in the form of Schedule 1.1h.

“SEC” means the United States Securities Exchange Commission.

“Second Amendment” has the meaning assigned thereto in Recital C.

“Second ISDA Notice” has the meaning assigned thereto in Recital G.

“Security Agreement” means the Security Agreement dated as of October 1, 2018 executed by JHC in favor of Agent, the Security Agreement dated as of February 19, 2019 executed by JMC in favor of Agent, in each case on behalf of the Lenders, and any other security agreement executed by a Subsidiary, in form and substance satisfactory to Agent; in each case as originally executed or as it may from time to time be supplemented, modified, amended, extended or supplanted.

“Solvent” has the meaning assigned thereto in Section 5.26.

“Specified Events of Default” has the meaning assigned thereto in Recital D.

“Specified Leases” has the meaning assigned thereto in the definition of “Lease Event of Default”.

“Strategic Alternative” has the meaning assigned thereto in Section 6.22(a).

“Strategic Alternative Closing Milestone” has the meaning assigned thereto in Section 6.22(c).

“Strategic Alternative Event of Default” has the meaning assigned thereto in Section 6.22(d).

“Strategic Alternative LOI Milestone” has the meaning assigned thereto in Section 6.22(a).

“Stock” means all certificated and uncertificated shares, options, warrants, general or limited partnership interests, participation or other equivalents (regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent entity whether voting or nonvoting, including common stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934).

“Subsidiary” means, as of any date of determination and with respect to any Person, any corporation, limited liability company or partnership (whether or not, in any case, characterized as such or as a “joint venture”), whether now existing or hereafter organized or acquired: (a) in the case of a corporation or limited liability company, of which a majority of the securities having ordinary voting power for the election of directors or other governing body (other than securities having such power only by reason of the happening of a contingency) are at the time beneficially owned by such Person and/or one or more Subsidiaries of such Person, or (b) in the case of a partnership, of which a majority of the partnership or other ownership interests are at the time beneficially owned by such Person and/or one or more of its Subsidiaries.

“Subsidiary Guarantor” means a Subsidiary of Borrower that has delivered to Agent a Subsidiary Guaranty and security agreement in accordance with Section 7.19.5.

“Subsidiary Guaranty” means a guaranty made by a Subsidiary in favor of Agent, whereby such Subsidiary guaranties performance of the Obligations under the Loan Documents, including that certain Subsidiary Guaranty dated as of October 1, 2018 by JHC, the Subsidiary Guaranty dated as of February 19, 2019 by JMC, each executed in favor of Agent, on behalf of the Lenders, in each case either as originally executed or as it may from time to time be supplemented, modified, amended, extended or supplanted.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Swap Contract Counterparty” means any Person that is the Agent, a Lender or an Affiliate of either of them at the time it enters into a Swap Contract, in its capacity as a party to a Swap Contract, whether or not such Person subsequently ceases to be the Agent, a Lender or an Affiliate of either of them. For clarity, MUFG Bank is a Swap Contract Counterparty with respect to the MUFG Bank Lender Hedging Obligations.

“Swap Obligation” means, with respect to Borrower or any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a "swap" within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to- market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include the Agent, a Lender or any Affiliate of either of them).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), value added taxes, or any other goods and services, use or sales taxes, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term Loan Commitment” means, subject to Section 2.7 Eighty Three Million Five Hundred Fourteen Thousand Eight Hundred Twenty Three and 64/100 Dollars ($83,514,823.64) (which amount does not take into account capitalized interest for April 2020 to be added to the principal on May 1, 2020). The Term Loan Commitment is subject to increase on account of the PIK Interest that is added to the amount thereof pursuant to the terms herein. The respective Pro Rata Shares of the Lenders with respect to the Term Loan Commitment are set forth in Schedule A.

“Term Loan” means a loan(s) made by the Lenders to Borrower pursuant to Section 2.1.

“Term Note” means each and collectively those certain promissory notes executed and delivered by Borrower to each Lender in accordance with its Pro Rata Share of the Term Loan Commitment, dated as of the Closing Date, in the original aggregate principal amount of the Term Loan Commitment, together with any other notes executed and delivered by Borrower to any Lender evidencing at any time any portion of the Loans.

“Termination Date” means the date on which the Loans and all other Obligations under this Agreement and the other Loan Documents are indefeasibly paid in full, in cash, and Borrower shall have no further right to borrow any moneys or obtain other credit extensions or financial accommodations under this Agreement.

“Third Amendment” has the meaning assigned thereto in Recital C.

“Trust Agreement” means a Trust Agreement between Owner Trustee, as owner trustee, and Borrower, as the sole beneficiary, as amended, supplemented or otherwise modified from time to time, whereby the parties agreed, among other things, that Owner Trustee shall act as trustee with respect to the “Equipment” and “Lease Agreement” as defined therein.

“UCC” means the Uniform Commercial Code as the same may, from time to time, be enacted and in effect in the State of New York; provided, that in the event by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of Agent’s Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of New York, the term “UCC” means the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions hereof relating to such attachment, perfection or priority and for purposes of definitions related to such provisions.

“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended form time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Unrestricted Cash” means the sum of Cash and Cash Equivalents of Borrower and its Subsidiary Guarantors held in deposit accounts other than the Restricted Account.

“Wholly-Owned Subsidiary” means a Subsidiary of Borrower, 100% of the capital stock or other equity interest of which is owned, directly or indirectly, by Borrower, except for director’s qualifying shares required by Applicable Law.

“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

. All accounting terms used, but not specifically defined, in this Agreement shall be construed and defined in accordance with GAAP.

. Any terms that are defined in the UCC and used, but not specifically defined, in this Agreement shall be construed and defined in accordance with the UCC.

. For purposes of this Agreement and the other Loan Documents, the following rules of construction shall apply, unless specifically indicated to the contrary: (a) wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and the plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter; (b) the term “or” is not exclusive; (c) the term “including” (or any form thereof) shall not be limiting or exclusive; (d) all references to statutes and related regulations shall include any amendments thereof and any successor statutes and regulations; (e) the words “herein,” “hereof” and “hereunder” or other words of similar import refer to this Agreement as a whole, including the exhibits and schedules hereto, as the same may from time to time be amended, modified or supplemented, and not to any particular section, subsection or clause contained in this Agreement; (f) all references in this Agreement or in the schedules to this Agreement to sections, schedules, disclosure schedules, exhibits, and attachments shall refer to the corresponding sections, schedules, disclosure schedules, exhibits, and attachments of or to this Agreement; and (g) all references to any instruments or agreements, including references to any of the Loan Documents, shall include any and all modifications or amendments thereto and any and all extensions or renewals thereof. Any reference herein to a merger, transfer, consolidation, amalgamation, consolidation, assignment, sale, disposition or transfer, or similar term, shall be deemed to apply to a division of or by a limited liability company, or an allocation of assets to a series of a limited liability company (or the unwinding of such a division or allocation), as if it were a merger, transfer, consolidation, amalgamation, consolidation, assignment, sale, disposition or transfer, or similar term, as applicable, to, of or with a separate Person.

. Each Lender is subject to the USA Patriot Act and hereby notifies Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (as amended and supplemented from time to time, the “Patriot Act”), each Lender is required to obtain, verify and record information that identifies Borrower, which information includes the name and address of Borrower and other information that will allow each Lender to identify Borrower in accordance with the Patriot Act.

. Except as expressly otherwise provided herein, any financial ratios required to be maintained by Borrower pursuant to this Agreement (or required to be satisfied in order for a specific action to be permitted under this Agreement) shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

. Notwithstanding anything herein or any other Loan Document to the contrary, whenever any document, agreement or other item is required by any Loan Document to be delivered on a day that is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day.

. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Stock at such time.

. Subject to the terms and conditions of this Agreement, each Lender severally agrees to extend Term Loans to Borrower on the Closing Date in an aggregate principal amount equal to such Lender’s Pro Rata Share of the Term Loan Commitment, at which time the aggregate principal amount extended to Borrower under the Credit Facility shall equal the Term Loan Commitment on the Closing Date and shall include the amounts already funded and owing under the Existing Loan. For the avoidance of doubt, the cashless exchange of Loans for the Existing Loan shall be the only means by which the Lenders shall make the Loans hereunder, and the Lenders shall have no obligations hereunder to make any funds available to Borrower. The Term Loans are not revolving credit loans, and amounts borrowed hereunder and repaid or prepaid may not be reborrowed. Borrower shall repay the Term Loans in full, together with any other amounts then due and owing Lender under this Agreement and the other Loan Documents, on the Maturity Date. The Term Loans shall be repayable in accordance with the terms of this Agreement and entries upon the books and records maintained by Agent.

. The Term Loan shall be a Base Rate Loan and shall accrue interest as set forth herein.

. Any notice in connection with a requested Term Loan under this Agreement that is received by Agent after 11:00 a.m. (California time) on any Business Day, or at any time on a day that is not a Business Day, shall be deemed received by Agent on the next Business Day. Promptly following receipt of a request for a Loan, Agent shall notify each Lender by telephone or telecopier (and if by telephone, promptly confirmed by telecopier) of the date of the Loan and that Lender’s Pro Rata Share of the Loan. Not later than 10:00 a.m., California time, on the date specified for any Loan (which must be a Business Day), each Lender shall be deemed to have made its Pro Rata Share of the Loan in immediately available funds available to Agent at Agent’s office and the requested Term Loan shall be deemed made on such date, and the information regarding which may be noted in Agent’s records (provided that, failure to update such records accordingly shall not in any manner affect the obligation of Borrower to repay the Loans). For clarity, (i) no disbursement of funds will be made to Borrower in connection with such request and references in this Agreement to making, funding, advancing Loans and like terms shall not be deemed to provide for the making of any new Loans and (ii) the requirements under this Section 2.1.2 shall be deemed satisfied upon the closing hereunder on the Closing Date.

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. Interest on Term Loans shall be payable as follows:

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. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

. Notwithstanding anything herein to the contrary, the cash component of the interest payments for the months of March (the “March Interest”) and April of 2020 (the “April Interest” and, together with the March Interest Payment, the “Deferred Interest”) due on April 1, 2020 and May 1, 2020, respectively, will be deferred and be due and payable on the earlier of (i) the date of receipt of net proceeds into the Restricted Account from the sale of Aircraft 238 and (ii) July 1, 2020 (such earlier date, the “Deferred Interest Due Date”). Pending such payment, (1) the amount on account of the PIK Interest component of the Late Fee accruing on the April Interest from May 1, 2020 through the Closing Date shall be capitalized and added to the principal balance of the Loans on the Closing Date and, thereafter, the amount on account of the PIK Interest component of the Late Fee accruing on the Deferred Interest for the period after the Closing Date until the Deferred Interest Due Date shall be waived; and (2) the amount on account of the Cash Interest component of the Late Fee accruing on the March Interest and the April Interest from April 1, 2020 and May 1, 2020, respectively, through the Deferred Interest Due Date shall be waived.

. Upon the occurrence and during the continuance of an Event of Default, interest on all outstanding Obligations shall, upon the election of Agent or the Requisite Lenders, confirmed by written notice from Agent to Borrower, accrue and be payable at the Default Rate; provided that, the Default Rate shall not apply as a result of solely a Strategic Alternative Event of Default unless the Requisite Lenders require it. Interest accruing at the Default Rate shall be payable to Agent, for the ratable benefit of Lenders, on demand and in any event on the Maturity Date. Agent shall not be required to (1) accelerate the maturity of the Loans or (2) exercise any other rights or remedies under the Loan Documents, in order to charge the Default Rate. Upon the occurrence and during the continuance of an Event of Default specified in Sections 9.1.5, 9.1.6, or 9.1.7, the interest rate shall be increased automatically to the Default Rate without the necessity of any action by Agent or the Requisite Lenders.

. In no event shall the aggregate of all interest on the Obligations charged or collected pursuant to the terms of this Agreement or pursuant to the Notes (if any) exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. In the event that such a court determines that a Lender has charged or received interest under this Agreement or the Notes (if any) in excess of the highest applicable rate, the rate in effect under this Agreement and the Notes (if any) shall automatically be reduced to the maximum rate permitted by Applicable Law and Lender shall promptly apply such excess to reduce the principal balance of the Obligations, or if the principal balance of the Obligations owing have been paid in full, Lender shall promptly apply such excess to reduce any other Obligations, and if all Obligations have been paid in full, then Lender shall refund to Borrower any interest received by Lender in excess of the maximum lawful rate; provided, that if at any time thereafter the rate of interest payable hereunder is less than the highest applicable rate, Borrower shall continue to pay interest hereunder at the highest applicable rate, until such time as the total interest received by Lender from the making of Loans hereunder is equal to the total interest that Lender would have received had the interest rate payable hereunder been (but for the operation of this Section 2.3) the interest rate payable since the Closing Date as otherwise provided in this Agreement. It is the intent of this Agreement that Borrower not pay or contract to pay, and that Lender not receive or contract to receive, directly or indirectly, interest in excess of that which may be paid by Borrower under Applicable Law.

. Borrower shall pay to Agent:

. Annually on each future anniversary of the “Closing Date” as defined in the Existing Credit Agreement (i.e., February 19, 2019), a fee for ongoing administration of the Credit Facility equal to $50,000.00 plus $5,000 times the number of discrete Lenders (not to include MUFG Union Bank, N.A.) subscribed to the Credit Facility, which fee shall be solely for Agent’s own account and is nonrefundable.  Borrower shall also reimburse Agent for charges to set up and maintain the website for the Lenders in the Credit Facility.

. If any installment of principal or interest or any fee or cost or other amount payable under any Loan Document to Agent or any Lender is not paid when due (after giving effect to any applicable grace periods), it shall thereafter bear interest at the fluctuating rate per annum at all times equal to the Default Rate, to the fullest extent permitted by Applicable Law; provided, however, the foregoing late payment charge (the “Late Fee”) shall not apply to a Strategic Alternative Event of Default unless Requisite Lenders require it. The Late Fee is imposed for the purpose of defraying the expenses of Agent and the Lenders incident to handling such delinquent payment. This provision shall not, however, be construed as extending the time for payment of any amount due under the Loan Documents. The Late Fee shall be in addition to, and not in lieu of, any other amount that Agent or the Lenders may be entitled to receive or action that Agent or the Lenders may be authorized to take as a result of such late payment. Accrued and unpaid interest on past due amounts (including, without limitation, interest on past due interest) shall be compounded monthly, on the last day of each calendar month, to the fullest extent permitted by Applicable Law.

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. The principal amount of any Base Rate Loan may be prepaid, in whole or in part, prior to the Maturity Date, together with accrued interest to the date of such prepayment on the aggregate principal amount prepaid, at any time upon a written notice to Agent not later than 11:00 a.m. (California time) on the date of the prepayment of such Base Rate Loan. Each notice of prepayment shall be irrevocable. Any Loan repaid may not be reborrowed.

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. Upon the occurrence of a Change in Control, the Term Loan Commitment shall be terminated, and all outstanding Loans shall, together with all accrued interest thereon, immediately be due and payable.

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. Borrower shall pay principal, interest, fees, and all other amounts due on the Obligations without condition or deduction for any set-off, recoupment, defense or counterclaim or any other deduction whatsoever.

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. The proceeds of the Loans shall be used by Borrower to convert the existing revolving debt to a term loan and to support Borrower’s working capital needs and general corporate purposes. Borrower will not, directly or indirectly, use any part of any Loan proceeds for the purpose of purchasing or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System or to extend credit to any Person for the purpose of purchasing or carrying any such margin stock, or for any purpose which violates, or is inconsistent with, Regulation X of such Board of Governors.

. All Obligations related to the Credit Facility constitute one general obligation of Borrower and shall be secured by Agent’s Liens upon all of the Collateral, and by all other Liens previously, now or at any time in the future granted by Borrower to Agent or any Lender to the extent provided in the Collateral Documents and permitted by this Agreement.

. Agent is authorized to make the Loans based on telephonic or other oral or written instructions received from any Person that Agent believes in good faith to be an authorized representative of Borrower, or at the discretion of Agent, if such Loans are necessary to satisfy any of the Obligations. Borrower consents to the recordation of any telephonic or other communications between Agent and Borrower for the purpose of maintaining such party’s business records of such transactions.

. Borrower authorizes Agent, upon prior notice to Borrower, to debit any of Borrower’s deposit account(s) with Agent (including the Restricted Account) for the purpose of Borrower’s payment of principal, interest, fees and other costs and expenses due and payable by Borrower under this Agreement.

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Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and Agent in writing of its legal inability to do so.

. To secure the prompt payment and performance of all Obligations,

. Borrower represents, warrants and agrees as follows: (1) upon the execution of this Agreement by the parties hereto and all other documents contemplated hereby (as referenced in Section 3.1 above) and as a result of the filing by Agent of appropriate financing statements in the appropriate jurisdictions and appropriate documentation with the FAA, Agent’s Liens in the Collateral are and will be fully perfected Liens on all Collateral, which Liens are and will, until the Termination Date, be enforceable as first priority, fully perfected Liens as against all other creditors of, and purchasers from, Borrower; (2) all actions necessary or desirable to protect and perfect such Liens in favor of Agent in all of the Collateral has been duly taken; (3) Borrower or Owner Trustee, as applicable, are and will be the sole owner of each such item of the Collateral, and have and will have good and marketable title to such Collateral free and clear of any and all Liens except for Permitted Liens; and (4) no effective security agreement, mortgage, deed of trust, financing statement, equivalent security or Lien instrument or continuation statement covering all or any part of the Collateral is or will be on file or of record in any public office, except those filed by Borrower in favor of Agent pursuant to the Loan Documents, and those relating to other Permitted Liens. Borrower shall defend the right, title and interest of Agent in and to the Collateral against the claims and demands of all Persons whomsoever, and shall take such actions, including (i) the prompt delivery of all original Instruments, Chattel Paper and certificated Stock owned by Borrower to Agent, (ii) notification of Agent’s interest in Collateral at Agent’s request, and (iii) the institution of litigation against third parties as shall be prudent in order to protect and preserve Borrower’s and Agent’s respective and several interests in the Collateral. All Chattel Paper shall be marked with the following legend:

“THIS WRITING AND THE OBLIGATIONS EVIDENCED OR SECURED HEREBY ARE SUBJECT TO THE LIEN OF MUFG UNION BANK, N.A., AS ADMINISTRATIVE AGENT”

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. To the extent permitted by Applicable Law, Borrower hereby irrevocably makes, constitutes, and appoints Agent (and any of Agent’s officers, employees or Agent designated by Agent) as Borrower’s true and lawful attorney-in-fact, with power to: (a) sign the name of Borrower on any document to be executed, recorded or filed in order to perfect or continue perfected Agent’s Lien upon the Collateral if Borrower fails to do so promptly after request therefor by Agent, including filing any financing or continuation statement without the signature of Borrower to the extent permitted by Applicable Law; (b) at any time after the occurrence and continuance of an Event of Default (other than the Specified Events of Default during the Forbearance Period), sign Borrower’s name on any invoice or bill of lading relating to any Account, drafts against Account Debtors, schedules and assignments of Accounts, verifications of Accounts and notices to Account Debtors; (c) at any time after the occurrence and continuance of an Event of Default (other than the Specified Events of Default during the Forbearance Period), send requests for verification of Accounts; (d) at any time after the occurrence and continuance of an Event of Default (other than the Specified Events of Default during the Forbearance Period), endorse Borrower’s name on any checks, notices, acceptances, money orders, drafts, or other forms of payment or security that may come into Agent’s possession; and (e) at any time that a Default or Event of Default (other than Specified Events of Default during the Forbearance Period) has occurred and is continuing, (1) notify the post office authorities to change the address for delivery of Borrower’s mail to an address designated by Agent, to receive and open all mail addressed to Borrower, and to retain all mail relating to the Collateral and forward all other mail to Borrower, (2) make, settle, and adjust all claims under Borrower’s policies of insurance and make all determinations and decisions with respect to such policies of insurance, and (3) settle and adjust disputes and claims respecting the Accounts directly with Account Debtors, for amounts and upon terms which Agent determines to be reasonable, and Agent may cause to be executed and delivered any documents and releases which Agent determines to be necessary. The appointment of Agent as Borrower’s attorney-in-fact, and each and every one of Agent’s rights and powers, being coupled with an interest, is irrevocable until all of the Obligations have been fully repaid and performed and Agent’s obligation to provide Loans hereunder is terminated. NEITHER LENDERS NOR ANY OF THEIR OFFICERS, DIRECTORS, EMPLOYEES, LENDERS OR REPRESENTATIVES SHALL BE RESPONSIBLE TO BORROWER FOR ANY ACT OR FAILURE TO ACT PURSUANT TO THE POWERS GRANTED UNDER THE POWER OF ATTORNEY HEREIN OR OTHERWISE, EXCEPT FOR ITS OR THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, NOR FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES.

. For the purpose of enabling Agent to exercise its rights and remedies under the Loan Documents, Borrower hereby grants to Agent an irrevocable, non-exclusive license (exercisable only upon the occurrence and continuance of an Event of Default and without payment of royalty or other compensation to Borrower) to use, transfer, license or sublicense any Intellectual Property now owned, licensed to, or hereafter acquired by Borrower, and wherever the same may be located, and including in such license access to all media in which any of the licensed items may be recorded or stored and to all computer and automatic machinery software and programs used for the compilation or printout thereof, and Borrower represents, warrants and agrees that any such license or sublicense is not and will not be in conflict with the contractual or commercial rights of any other Person; provided, that such license will terminate on the Termination Date.

. The provisions of this Section 3 shall to the extent permitted by Applicable Law remain in full force and effect and continue to be effective even if: (a) any petition is filed by or against Borrower or Owner Trustee for liquidation or reorganization; (b) Borrower or Owner Trustee becomes insolvent or makes an assignment for the benefit of creditors; (c) a receiver or trustee is appointed for all or any significant part of Borrower’s or Owner Trustee’s assets; or (d) at any time payment and performance of the Obligations, or any part thereof, is, pursuant to Applicable Law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Obligations, whether as a “voidable preference,” “fraudulent transfer” or otherwise, all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Obligations and Agent’s Liens in the Collateral shall be reinstated and deemed reduced only by any amount paid and not so rescinded, reduced, restored or returned.

. Subject to Requisite Lenders’ approval (in their sole and absolute discretion), Agent is authorized to, from time to time, execute partial releases of Collateral sold by Borrower in accordance with this Agreement (including in connection with an Aviation Asset Disposition) from the security interests under the Loan Documents which partial releases shall be in form reasonably satisfactory to Agent.

. Notwithstanding anything herein to the contrary, the Lenders hereby provide their consent to the sale of the Aircraft 238 and the release of the security interests and liens granted under the Collateral Documents with respect to the Aircraft 238, provided that funds representing the purchase price paid for the Aircraft 238 of approximately $2,350,000 less the down payment already in Agent’s possession and the transaction costs described in clause (i) of the definition of Net Cash Proceeds are deposited in the Restricted Account upon closing of such sale. Agent is authorized to enter into and deliver in connection with such Disposition appropriate lien releases, filings and related instruments necessary to effectuate the terms of this provision and the discharge of the liens granted to Agent under the Collateral Documents with respect to Aircraft 238, including this Agreement and the Mortgage, and no further consent of or notice to the Lenders is required in connection therewith

. Lenders shall not be obligated to make any Loan, or to take, fulfill, or perform any other action under this Agreement, until the following conditions have been satisfied to Agent’s reasonable satisfaction or waived in writing by Agent:

If any other term of any Loan Document should conflict, or appear to conflict, with this Section 4.1, the terms of this Section 4.1 shall control, and Borrower shall have no rights under this Agreement or any other Loan Document until each of the conditions of this Section 4.1 has been complied with to Agent’s and Lenders’ satisfaction or specifically waived in a writing by Lenders.

. Except as otherwise provided in this Section 4.2, Borrower agrees to deliver to Agent each item required to be delivered to Agent under this Agreement as a condition precedent to the Closing Date. Borrower agrees to deliver to Agent the following items:

Borrower represents, warrants and agrees that from and after the Closing Date and until the Termination Date:

. Borrower is a corporation duly formed, validly existing and in good standing under the Applicable Law of Delaware. Borrower is duly qualified or registered to transact business and is in good standing in Delaware and California and in each other jurisdiction in which the conduct of its business or the ownership or leasing of its Property makes such qualification or registration necessary and in which the failure to be so qualified or registered could have a Material Adverse Effect. Borrower has all requisite power and authority to conduct its business, to own, pledge, mortgage or otherwise encumber and operate its Property, to lease the Property it operates under lease, to conduct its business as now or proposed to be conducted, to execute and deliver each Loan Document to which it is a party and to perform its Obligations. Borrower is in compliance with all Applicable Law and other legal requirements applicable to its business, has obtained all authorizations, consents, approvals, orders, licenses and permits from, and has accomplished all filings, registrations and qualifications with, or obtained exemptions from any of the foregoing from, any Governmental Authority that are necessary for the transaction of its business.

. The locations of Borrower’s executive offices, principal place of business, corporate offices, warehouses, other locations of Collateral and locations where all of Borrower’s records with respect to Collateral are kept are as set forth in Schedule 5.2 and, except as set forth in such schedule, such locations have not changed during the preceding twelve (12) months. Borrower shall not change its (a) name, (b) chief executive office, (c) principal place of business or jurisdiction of formation, or (d) location of its records concerning the Collateral, without, in each instance, giving thirty (30) days’ prior written notice thereof to Agent and taking all actions deemed necessary or appropriate by Agent to protect and perfect Agent’s Liens continuously upon the Collateral.

. The execution, delivery and performance by Borrower, any Owner Trustee, and any Subsidiary of the Loan Documents to which each is a party have been duly authorized by all necessary corporate action, and do not and will not:

. Except as previously obtained or made, no authorization, consent, approval, order, license or permit from, or filing, registration or qualification with, any Governmental Authority is or will be required to authorize or permit under Applicable Law the execution, delivery and performance by Borrower, Owner Trustee and any Subsidiary of the Loan Documents to which it is a party.

. Borrower has no Subsidiaries as of the Closing Date other than JHC, JMC, JFC, and ACY 15129 and the Excluded Subsidiaries consisting of ACY SN 19002 Limited, ACY SN 19003 Limited, and ACY E-175 LLC.

. Borrower has furnished to Lender the audited Financial Statements of Borrower as of the Fiscal Year ending December 31, 2019 (including balance sheets and income statements). The financial information contained therein fairly presents in all material respects the financial condition, results of operations and changes in financial position of Borrower as of such date and for such period.

. Borrower and its Subsidiaries do not have any material liability or material contingent liability required under GAAP to be reflected or disclosed, and not reflected or disclosed, in the balance sheets described in Section 5.6 other than liabilities and contingent liabilities arising in the ordinary course of business since the date of such Financial Statements. Except as set forth on Schedule 5.7, as of the Closing Date, no circumstance or event has occurred that constitutes a Material Adverse Effect.

. Borrower and its Subsidiaries have valid title to the Property, including all Equipment, as reflected in the balance sheet described in Section 5.6, other than items of Property or exceptions to title which are in each case immaterial and Property subsequently sold or disposed of in the ordinary course of business. Such Property is free and clear of all Liens and Rights of Others, other than those described in Schedule 5.7 and Permitted Liens and Permitted Rights of Others.

. Borrower and its Subsidiaries own, or possess, the right to use to the extent necessary in their respective businesses, all Intellectual Property, and no such Intellectual Property conflicts with the valid Intellectual Property of any other Person. Except as set forth in Schedule 5.9, Borrower has not used any trade name, trade style or “dba” during the five year period ending on the Closing Date.

. Except for matters set forth in Schedule 5.10, there are no actions, suits, proceedings or investigations pending as to which Borrower or any of its Subsidiaries have been served or have received notice or, to the best knowledge of Borrower, threatened against or affecting Borrower or any of its Subsidiaries or any Property of any of them, the Collateral, or any other transactions contemplated by this Agreement.

. Each of the Loan Documents to which Borrower, Owner Trustee, and any Subsidiary is a party will, when executed and delivered by such party, constitute the legal, valid and binding obligation of such party, enforceable against such party in accordance with its terms.

. No event has occurred and is continuing that is a Default or Event of Default other than the Specified Events of Default.

. Neither Borrower nor any of its Subsidiaries has any Pension Plans. Neither Borrower nor any of its Subsidiaries has incurred or expects to incur any withdrawal liability to any Multiemployer Plan (as defined herein). As used herein, “Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA) and “Multiemployer Plan” means any employee benefit plan of the type described in Section 001(a)(3) of ERISA to which Borrower or any of its ERISA affiliates contributes or is obligated to contribute.

. No part of the proceeds of any Loan hereunder will be used to purchase or carry, or to extend credit to others for the purpose of purchasing or carrying, any margin stock in violation of Regulation U. Neither Borrower nor any of its Subsidiaries is or is required to be registered as an “investment company” under the Investment Company Act of 1940.

. No written statement made by an Authorized Signatory to Lender in connection with this Agreement, or in connection with any Loan, as of the date thereof contained any untrue statement of a material fact or omitted a material fact necessary to make the statement made not misleading in light of all the circumstances existing at the date the statement was made.

. Borrower and its Subsidiaries have filed all Tax returns which are required to be filed, and have paid, or made provision for the payment of, all Taxes with respect to the periods, Property or transactions covered by said returns, or pursuant to any assessment received by Borrower or any of its Subsidiaries, except such Taxes, if any, as are being contested in good faith by appropriate proceedings and as to which adequate reserves have been established and maintained.

. Except as described in Schedule 5.17, as of the Closing Date (a) neither Borrower nor any of its Subsidiaries at any time has disposed of, discharged, released or threatened the release of any Hazardous Materials in violation of any Environmental Laws, (b) to the best knowledge of Borrower, no condition exists that violates any Environmental Law affecting any real property owned by Borrower or any of its Subsidiaries, (c) no real property or any portion thereof is or has been utilized by Borrower or any of its Subsidiaries as a site for the manufacture of any Hazardous Materials and (d) to the extent that any Hazardous Materials are used, generated or stored by Borrower or any of its Subsidiaries on any real property, or transported to or from such real property by Borrower or any of its Subsidiaries, such use, generation, storage and transportation are in compliance with all Environmental Laws.

. Upon the execution and delivery of all of this Agreement and the Collateral Documents and the completion of all actions to perfect the security interests so created, as set forth in Section 3.1.7, Agent will hold a valid first priority security interest in the Collateral described therein securing the Obligations.

. Schedule 5.19 lists all current insurance of any nature maintained by Borrower, as well as a summary of the terms of such insurance provided Schedule 5.19 shall list insurance for Equipment leased pursuant to an Eligible Lease. Borrower shall deliver to Agent endorsements to all of its (a) “All Risk” and business interruption insurance policies naming Agent as loss payee, and (b) general liability and other liability policies naming Agent as an additional insured. All policies of insurance on real and personal property will include an endorsement, in form and substance acceptable to Agent, showing loss payable to Agent (Form 438 BFU or equivalent) and extra expense and business interruption endorsements. Such endorsement, or an independent instrument furnished to Agent, will provide that the insurer will endeavor to give at least thirty (30) days’ prior written notice to Agent before any such policy or policies of insurance shall be canceled. Upon the occurrence and continuation of a Default or Event of Default, Borrower hereby directs all present and future insurers under its and its Subsidiaries’ “All Risk” policies of insurance to pay all proceeds payable thereunder directly to Agent for the ratable benefit of Lenders. Agent reserves the right at any time, upon review of Borrower’s risk profile, to require additional forms and limits of insurance to adequately protect Lenders’ interests in accordance with Agent’s normal practices for similarly situated borrowers, and if the circumstances are unusual, in Agent’s sole opinion.

. Each of the following is true and correct with respect to each Lease for an item of Equipment:

.

. The Borrower’s depreciation policies with respect to the Equipment are as set forth on Schedule 5.22. These policies have been in effect substantially without change since January 1, 1998.

. As of the Closing Date, Borrower is not a party to a Swap Contract, except that Borrower was a party to MUFG Bank Swap Contracts and the transactions thereunder have been closed out, giving rise to the MUFG Bank Swap Termination Value.

. A list of all items of Equipment subject to a Lease in effect as of the Closing Date is set forth in Schedule 1.1b.

. Borrower shall or shall cause any other Person, as applicable, to (i) register with the FAA and/or International Registry and/or create a Lien in favor of Agent under Applicable Law, and thereafter maintain, such Lien and, as applicable, the International Interest of each Mortgage and Owner Trustee Mortgage, if any, and the International Interest of each Lease with a Lessee domiciled or with its chief executive office in a Contracting State; and (ii) maintain the rights and International Interests of the Equipment Owner in the Equipment, as against any third parties under Applicable Law and as against all third parties, whether in any Contracting State under the Cape Town Convention or otherwise.

. Borrower is, and after giving effect to the transactions contemplated hereby, will be, Solvent. “Solvent” for purposes of this Agreement means, with respect to any Person, that the aggregate present fair saleable value of such Person’s assets is in excess of the total amount of its probable liabilities on its existing debts as they become absolute and matured, such Person has not incurred debts beyond its foreseeable ability to pay such debts as they mature, and such Person has capital adequate to conduct the business it is presently engaged in or is about to engage in.

. Borrower, its Subsidiaries and their respective officers and employees and to the knowledge of Borrower its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. Borrower has implemented and maintains in effect for itself and its Subsidiaries policies and procedures to ensure compliance by Borrower, its Subsidiaries, and their respective officers, employees, directors, and agents with Anti-Corruption Laws and applicable Sanctions. None of Borrower, any of its Subsidiaries or, to the knowledge of Borrower, any director or officer of Borrower or any of its Subsidiaries is an individual or entity that is, or is 50% or more owned (individually or in the aggregate, directly or indirectly) or controlled by individuals or entities (including any agency, political subdivision or instrumentality of any government) that are (i) the target of any Sanctions or (ii) located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions, currently Crimea, Cuba, Iran, North Korea and Syria.

. Schedule 5.28 is a true, correct and complete list of all banks and other financial institutions at which Borrower or any Subsidiary maintains deposit accounts, and such schedule correctly identifies the name, address and telephone number of each bank or other institution, the name in which the account is held, a description of the purpose of the account, and the complete account number therefor.

So long as any portion of the Loan remains in force and/or any Obligation remains unpaid, Borrower shall, and shall cause its Subsidiaries to:

. Pay and discharge promptly all Taxes, assessments and governmental charges or levies imposed upon any of them, upon its respective Property or any part thereof and upon its respective income or profits or any part thereof, except that Borrower and its Subsidiaries shall not be required to pay or cause to be paid any Tax that is not yet past due, or is being contested in good faith by appropriate proceedings so long as the relevant entity has established and maintains adequate reserves for the payment of the same.

. Preserve and maintain its respective existences in the jurisdiction of its formation and all material authorizations, rights, franchises, privileges, consents, approvals, orders, licenses, permits, or registrations from any Governmental Authority that are necessary for the transaction of its respective business and qualify and remain qualified to transact business in each jurisdiction in which such qualification is necessary in view of its respective business or the ownership or leasing of its respective Property.

. Maintain, or, with respect to Property subject to Leases, require the Lessees to maintain, in good working order and condition, consistent with industry practice and standards (taking into consideration normal wear and tear), all of its Property and not permit any waste thereof, and, in the ordinary course of business, make all needful and proper repairs, replacements, additions and improvements thereto as are necessary for the conduct of its business, except that the failure to maintain, preserve and protect a particular item of Property that is at the end of its useful life or that is not of significant value, either intrinsically or to the operations of Borrower, shall not constitute a violation of this covenant.

. Maintain or cause Lessee(s), as applicable, liability, casualty and other insurance (subject to customary deductibles and retentions) on all Property with responsible insurance companies in such amounts and against such risks as is carried by responsible companies engaged in similar businesses and owning similar assets in the general areas in which Borrower and its Subsidiaries operate and shall furnish to Lenders statements of its insurance coverage and shall promptly, upon Agent’s request, furnish other or additional insurance deemed necessary by Agent to the extent that such insurance may be available. Borrower shall take all actions required to maintain the foregoing insurance and/or to comply with all requirements of such insurance coverage. Agent shall be named as additional insureds on all liability insurance, all risk ground and flight coverage for damage or loss of the related Equipment, and war risk insurance (if applicable) and Agent shall be named as a loss payee under all hull insurance policies insuring the Collateral. Borrower shall deliver to Agent endorsements to all of its (a) “All Risk” and business interruption insurance policies naming Agent as loss payee, and (b) general liability and other liability policies naming Agent as an additional insured. All policies of insurance on real and personal property will include an endorsement, in form and substance acceptable to Agent, showing loss payable to Agent (Form 438 BFU or equivalent) and extra expense and business interruption endorsements. Such endorsement, or an independent instrument furnished to Agent, will provide that the insurer will give at least thirty (30) days’ prior written notice to Agent before any such policy or policies of insurance shall be canceled. Upon the occurrence and continuation of a Default or Event of Default, Borrower hereby directs all present and future insurers under its and its Subsidiaries’ “All Risk” policies of insurance to pay all proceeds payable thereunder directly to Agent for the ratable benefit of Lenders. Agent reserves the right at any time, upon review of Borrower’s risk profile, to require additional forms and limits of insurance to adequately protect Lenders’ interests in accordance with Agent’s normal practices for similarly situated borrowers, and if the circumstances are unusual, in Agent’s sole opinion.

. Comply with all Applicable Law, except that Borrower and its Subsidiaries need not comply with an Applicable Law then being contested by any of them in good faith by appropriate proceedings. The Borrower will maintain in effect and enforce policies and procedures designed to ensure compliance by Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

. At any time during regular business hours and as often as requested, permit Agent, or any authorized employee or representative thereof, to examine, audit and make copies and abstracts from the records and books of account of, and to visit and inspect the Property of, Borrower and its Subsidiaries and to discuss the affairs, finances and accounts of Borrower and its Subsidiaries with any of its officers, key employees or accountants.  In addition, Agent shall have the right to cause a Field Examination to be completed as described in Section 3.3.3. In addition, Borrower shall provide Lenders’ Consultant reasonable access during normal business hours to the offices, properties, officers, employees, accountants, auditors, counsel and other representatives, books and records of Borrower and its Subsidiaries, and furnish to Lenders’ Consultant such financial, operating and property related data and other information as Lenders’ Consultant reasonably requests. Borrower hereby (1) agrees and acknowledges that all of Lenders’ Consultant's analyses, conclusions, reports and other work product are confidential and covered by the attorney-work product privilege and the common interest privilege and, consequently, are exempt from disclosure to Borrower, any Subsidiary or any other Person, (2) acknowledges and agrees that Agent, the Lenders and Lenders’ Consultant may use and share, without liability, among themselves and their respective advisors, attorneys, consultants, accounts, and agents information regarding Borrower and any Subsidiary, the Collateral, the Credit Facility and the Loan Documents, including, without limitation, personally identifiable information and data, financial information, projections, lessee information, and (3) waives any rights or claims with respect to such use or sharing, including regarding financial privacy and data protection laws and regulations.

. Keep adequate records and books of account reflecting all financial transactions in conformity with GAAP, consistently applied, and in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over Borrower and its Subsidiaries.

. Promptly and fully comply with all Contractual Obligations to which any one or more of them is a party, except for any such Contractual Obligations (a) the performance of which would cause a Default or (b) then being contested by any of them in good faith by appropriate proceedings.

. Use the proceeds of the Loans only for the purposes set forth in this Agreement. Borrower will not request any Loan, and will not use, and Borrower will ensure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Loan in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws. Borrower will not, directly or indirectly, use the proceeds of the Loans, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, (i) to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Loans, whether as underwriter, advisor, investor, or otherwise).

. Keep and maintain all real property used and/or owned by Borrower and any of its Subsidiaries and each portion thereof in compliance in all material respects with all applicable Environmental Laws and promptly notify Lender in writing (attaching a copy of any pertinent written material) of (a) any and all material enforcement, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened in writing by a Governmental Authority pursuant to any applicable Hazardous Materials Laws, (b) any and all material claims made or threatened in writing by any Person against Borrower relating to damage, contribution, cost recovery, compensation, loss or injury resulting from any Hazardous Materials and (c) discovery by any senior officer of any of Borrower of any material occurrence or condition on any real property adjoining or in the vicinity of such real property that could reasonably be expected to cause such real property or any part thereof to be subject to any restrictions on the ownership, occupancy, transferability or use of such real property under any applicable Hazardous Materials Laws.

. Other than (i) JHC, (ii) JMC, (iii) JFC, (iv) ACY 15129 and (v) the Excluded Subsidiaries consisting of ACY SN 19002 Limited, ACY SN 19003 Limited, and ACY E-175 LLC, Borrower shall not create nor allow to exist any Subsidiary.

. (a) Pay and discharge or cause to be paid and discharged all Obligations in a timely manner; (b) pay and discharge, or cause to be paid and discharged, its Indebtedness in the ordinary course of business prior to an Event of Default; (c) pay and discharge, or cause to be paid and discharged promptly, all Charges; and (d) pay all lawful claims for labor, materials, supplies and services or otherwise, before any thereof shall become in default.

. (a) Conduct its business substantially as now conducted or as otherwise permitted hereunder; and (b) at all times maintain, preserve and protect all of the Collateral and keep the same in good repair, working order and condition consistent with industry practices and standards (taking into consideration ordinary wear and tear and excluding inventory and parts which by their nature may not be in good repair, working order or condition) and from time to time make, or cause to be made, all necessary or appropriate repairs, replacements and improvements thereto consistent with industry practices and standards.

. At any time and from time to time, upon the written request of Agent and at the sole expense of Borrower, promptly and duly execute and deliver any and all such further instruments and documents and take such further action as such Agent may reasonably request to obtain the full benefits of this Agreement and to protect, preserve and maintain all respective parties’ rights in the Collateral and under this Agreement. Upon the occurrence and continuation of a Default or Event of Default and as often as Agent may thereafter require, Borrower will supplement each Schedule to this Agreement with respect to any matter hereafter arising that, if existing or occurring as of the Closing Date, would have been required to be set forth or described in such Schedule; provided, that such supplement shall not be deemed to be an amendment thereof unless expressly consented to in writing by Agent.

. Transfer or cause to be transferred to Agent the Excess Cash as of the end of each Fiscal Quarter (as demonstrated by a Compliance Certificate delivered to Agent pursuant to Section 8.1.2 hereof) to pay down the Obligations in an amount equal to 100% of such Excess Cash. The transfer of such Excess Cash in accordance with the foregoing shall be done not later than the date of delivery to Agent of the Compliance Certificate. Agent is hereby authorized to make such transfer.

. Provide a subordination, on terms satisfactory to Agent, of any fees paid to any Subsidiaries or Affiliates of Borrower pursuant to ongoing contractual arrangements for services provided to Borrower, including without limitation, licensing, management and marketing fees.

. Borrower shall cause the Disposition of Equipment owned by it or any Subsidiary and the Excluded Assets (such a sale, an “Aviation Asset Disposition”) and use the Net Cash Proceeds from the Aviation Asset Disposition to pay down the Obligations. Each individual Aviation Asset Disposition shall be subject to Agent’s and Requisite Lenders’ consent in their respective sole and absolute discretion.

. Affix and maintain or use its best efforts to cause each Lessee under a Lease to affix to and maintain on all item(s) of Equipment a placard bearing an inscription substantially in the form attached hereto as Exhibit I or such other inscription as Agent from time to time may reasonably request. The Borrower shall, on a quarterly basis, provide to Agent a list of all Equipment subject to a Lease indicating, to the best knowledge of the Borrower, which items of Equipment have placards affixed and on which no such placard is affixed.

. Maintain its method of depreciating its assets substantially consistent with past practices as set forth in Schedule 5.22 and promptly notify Agent of any deviation from such practices.

. At its expense, cause (i) the registration with the International Registry of the International Interests with respect to the Mortgage and each Lease with a Lessee domiciled or with its chief executive office in a Contracting State or otherwise create a Lien in favor of Agent under Applicable Law, and (ii) maintain the rights and International Interests of the Equipment Owner in the Equipment or otherwise maintain such Lien, as against any third parties under Applicable Law and as against all third parties, whether in any Contracting State under the Cape Town Convention or otherwise. The Borrower agrees to furnish Agent with copies of all documents relating to the foregoing and with recording and registration data as promptly as practicable following the issuance of the same by the FAA, the International Registry, or such other Person under Applicable Law.

. Provide prompt notice to Agent of any amendment or termination of the JMC Management Agreement.

. Comply with the following requirements by the following deadlines:

. Agent shall possess a first priority security interest in any Equipment included in the Collateral which shall be (i) electronically recorded on the International Registry (Cape Town Convention), (ii) filed with the FAA in the case of (A) any Aircraft that are registered with the FAA and (B) all Engines, whether or not attached to an Aircraft or a Leased Spare Engine, and (iii) promptly, to the satisfaction of Agent, and as soon as practical and in any event within thirty (30) days following registration with the International Registry, perfected through all additional required local foreign jurisdiction security conventions (if any) to secure the payment, promptly when due. Borrower shall execute a Lessee Letter for each Lease.

. Cause all Lessees of Equipment to maintain adequate maintenance and usage records in English in accordance with applicable aviation regulations.

. Comply with the following:

. Comply with the following:

An immediate Event of Default shall occur if the PPP Loan ceases to be eligible for forgiveness.

Borrower covenants and agrees that, from the Closing Date until the Termination Date, Borrower and its Subsidiaries shall not, directly or indirectly, by operation of law or otherwise:

. Amend its certificate of incorporation or formation documents that could have or reasonably be expected to have a Material Adverse Effect.

. Take any action or omit to take any action, which act or omission would constitute a material default or a material event of default pursuant to, or noncompliance with, any contract, lease (including any Leases), mortgage, deed of trust or instrument to which it is a party or by which it or any of its property is bound, or any document creating a Lien and which would have a Material Adverse Effect on Borrower’s business.

. Cancel or modify any debt owing to it, except for reasonable consideration in the ordinary course of its business or which would not have a Material Adverse Effect on Borrower’s financial condition.

. Allow Cash or any other Collateral to be directly or indirectly transferred to any Restricted Subsidiary; provided that, so long as no Default or Event of Default (other than the Specified Events of Default during the Forbearance Period) then exists, Borrower may transfer to the JFC Bank Account at any one time funds sufficient to satisfy the JFC Obligations projected to be due and payable in the next thirty (30) days.

. Make any sale, transfer or other disposition in any single transaction or series of related transactions of any asset or group of related assets of Borrower or any of its Subsidiaries, whether now owned or hereafter acquired (“Disposition”), except (i) a Disposition (other than an Aviation Asset Disposition) by Borrower to a Wholly-Owned Subsidiary that is not a Restricted Subsidiary and (ii) Aviation Asset Disposition in accordance with Section 6.17.

. Merge or consolidate with or into any Person.

. Directly or indirectly use the proceeds of any Loan or Collateral in connection with the Acquisition of part or all of a voting interest in any corporation or other business entity.

. Make any Distribution, whether from capital, income or otherwise, whether in Cash or other Property.

. Create or maintain any Pension Plans or incur any withdrawal liability to any Multiemployer Plan (as defined herein).

. Make any material change in the nature of the business of Borrower and its Subsidiaries, taken as a whole, or at any time, permit any Change in Control to occur.

. Not enter into any Swap Contract, unless (i) such Swap Contract was entered into by such Person in the ordinary course of business for the purpose of directly mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person, and not for purposes of speculation, (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party other than normal setoff or netting rights, and (iii) Borrower obtains Agent’s prior written approval (which may be withheld, delayed or conditioned in Agent’s sole and absolute discretion).

. Create, incur, assume or suffer to exist any Lien or Negative Pledge of any nature upon or with respect to any of its respective Property or any Collateral or engage in any sale and leaseback transaction with respect to any of its respective Property or any Collateral, whether now owned or hereafter acquired, except:

. Create, incur or assume any Indebtedness or guaranty obligation except:

. Make, or suffer to exist, any loan or advance or extend any credit to any Person, including, without limitation, any Affiliate of the Borrower other than, but to the extent not otherwise prohibited hereunder:

. Permit (whether or not otherwise permitted under Section 7.13) any Subsidiary to create, incur, assume or suffer to exist any Indebtedness or guaranty obligation, except (a) Indebtedness and Guaranteed Indebtedness (i) under the Loan Documents or (ii) in existence on the Closing Date and described on Schedule 1.1f, (b) Indebtedness owed (other than from a Restricted Subsidiary) to Borrower or another Subsidiary (other than a Restricted Subsidiary) of Borrower (to the extent not otherwise prohibited hereunder), (c) Capital Lease Obligations and purchase money obligations of a Subsidiary in respect of Property used or leased by that Subsidiary (subject to the limitations in Sections 7.12.4 and 7.13.3; and (d) with respect to the Excluded Subsidiaries, the Permitted Excluded Subsidiary Financing.

. Notwithstanding anything to the contrary in this Agreement or any other Loan Document:

. Issue or otherwise grant shares of stock to any new shareholders unless (i) Agent has confirmed that such transaction would not cause a violation of the Patriot Act and (ii) such new shareholder(s) has executed a stock pledge agreement and stock power in favor of Agent for the ratable benefit of Lenders, in form and substance satisfactory to Agent.

. Purchase, redeem, retire or otherwise acquire, directly or indirectly, or make any sinking fund payments or declare or pay any dividends with respect to, any shares of its Stock now or hereafter outstanding or set apart any sum for any such purpose; nor agree (or cause or permit any Subsidiary to agree) with any third party to prohibit, condition or restrict the payment of dividends and distributions by such Subsidiary to Borrower or to another Subsidiary.

. Make or suffer to exist any Investment, other than:

. Directly or indirectly, open, maintain or otherwise have deposit accounts, except (i) the Restricted Account, (ii) any other deposit account with respect to which Agent has an Account Control Agreement, and (iii) as long as Borrower remains in compliance with Section 7.4, the JFC Bank Account. Borrower shall, and shall cause each Subsidiary (other than an Excluded Subsidiary) to, not hereafter establish and maintain any deposit account unless (1) Borrower shall have given the Agent thirty (30) days’ prior written notice (or such lesser notice period as the Agent may agree to) of its intention to establish such new deposit account with a depository bank, (2) such depository bank shall be acceptable to the Agent and, (3) such depository bank and Borrower (or any such Subsidiary) shall have duly executed and delivered to the Agent, within twenty (20) Business Days of the date of establishing such deposit account, an Account Control Agreement with respect to such deposit account.

.

. Borrower represents, warrants and agrees that, from and after the Closing Date until the Termination Date, Borrower shall deliver, or cause to be delivered, to Agent:

. Continue on a bi-weekly basis, based on the timeline in place prior to Closing Date, to deliver to Agent a 13-week cash flow model (a “Cash Flow Budget”), in form and substance acceptable to Agent, along with a variance report (“Cash Flow Variance Report”) on both a week by week basis and a cumulative, weekly roll-forward basis through the end of the immediately preceding week, a comparison of the actual cash disbursements to the projected cash disbursements and the actual cash receipts to the projected cash receipts, each as set forth in the Cash Flow Budget for such period.

. Continue on a monthly basis, based on the timeline in place prior to Closing Date, to deliver to Agent (i) a twelve (12) month rolling cash-basis forecast of the maintenance cash disbursements related to the Collateral and Excluded Assets (“Maintenance Expense Report”). Each such Maintenance Expense Report shall provide a breakdown forecast with respect to each item of such assets, be consistent with the form attached hereto as Schedule 8.3 and as otherwise in form and substance satisfactory to Agent, and (ii) a variance report, on both a month-by-month basis and a cumulative, monthly roll-forward basis through the end of the immediately preceding month, comparing the actual cash disbursements to the projected cash disbursements for such period.

. Continue on a bi-weekly basis, based on the timeline in place prior to Closing Date, to deliver to Agent a detailed report containing the following information, satisfactory to the Lenders, regarding all aircraft and engines that are part of the Collateral (the “Collateral Report”): (i) the base location of the Collateral covered thereby and the country in which each aircraft is registered and the countries to which it is flown by its Lessee, (ii) whether such Collateral is on Lease, (iii) if it is on Lease, whether there is a default under such Lease and, if there is such a default, a description of the default and Borrower’s intended action with respect thereto, and (iv) with respect to Marketed Aircraft, an accounting of the ongoing expenses for storage, insurance and similar expenses for such Collateral, the date and time of any visits by or on behalf of Borrower to monitor such Collateral and the name of the person(s) undertaking such visits (beginning with the most recent visit made as of the date hereof and continuing for any visits made thereafter). The Collateral Report shall be consistent with the form provided by Borrower to Agent prior to the Closing Date and as otherwise in form and substance satisfactory to Agent.

. Continue to deliver, within twenty (20) days after each calendar month, to Agent a report (the “Maintenance Reserve Liability Report”), in form and substance satisfactory to Agent, for the latest period for which the Lessee has provided utilization information detailing the following information for each Aircraft constituting part of the Collateral:

. Make available on as frequently as a weekly basis, (i) senior management of Borrower and, at Borrower’s option or upon request of Agent, Borrower’s financial advisor, Financial Advisor/Consultant or other advisors for meetings or conference calls with Agent and the Lenders (and their representatives and consultants), and (ii) senior management of Borrower, Financial Advisor/Consultant and B. Riley for conference calls with Agent and Lenders’ advisors, in either case at such dates and times to be provided by Agent upon reasonable notice. The purpose of such meetings will be to discuss the status of the financial, collateral, and operational condition, businesses, liabilities, assets, and prospects of Borrower and the Collateral, any sale, refinance or other strategic transaction efforts.  Borrower and its Subsidiaries shall promptly provide copies of all non-privileged non-confidential written materials provided to, or produced by, Borrower or Subsidiaries in connection with any sale, refinance, other strategic transaction efforts (including, without limitation, any letters of intent, confidentiality agreements, draft purchase documents, commitment letters, and correspondence to or from any Governmental Authority) and material third party reports relating to the financial, collateral, or operational performance of Borrower and the Collateral or any other non-privileged non-confidential written material as Agent may reasonably request from time to time. Without limiting the foregoing, Borrower agrees to notify Agent immediately upon either Borrower becoming aware of any material change or development relating to any sale or refinance efforts or to the financial, collateral, or operational condition, businesses, assets, liabilities, or prospects of Borrower or the Collateral. Borrower agrees to cause, and hereby irrevocably authorizes, its Financial Advisor/Consultant to deliver to Agent and the Lenders such information as Agent and the Lenders may request concerning the Collateral, sale or refinance efforts related thereto, and the financial or operational condition of the businesses, assets, liabilities, or prospects of Borrower, and, in the event of termination of the services of the Financial Advisor/Consultant, the reasons for such termination.

. In connection with the submission of each Cash Flow Variance Report submitted for the Cash Flow Budget on a bi-weekly basis, deliver to Agent a report (the “Bank Account Report”) setting forth the following information for each bank account held by Borrower and its Subsidiaries: (i) the name of the Person on the account, (ii) the institution where the account is held, (iii) the type of the account, (iv) the account number redacted except for the last 4 digits, and (v) the balance of such account as of the last week covered by the Cash Flow Variance Report.

. Provide to Lenders’ Consultant on a weekly basis all offers received regarding the Collateral and Excluded Assets, any refinancing offers and any related transactional documents.

. Provide to Agent and Lenders on a weekly basis a report, in the form attached hereto as Schedule 8.9 (the “Bid Summary Report”) and as otherwise approved by Agent, containing a list of all bids on assets / refinancing offers received to date, list of aircraft involved in each bid, and economic return of each bid for the Lenders (with the bidder name may be redacted).

. Borrower shall, upon the request of any Lender or Agent, furnish to Agent such other reports in connection with the affairs, business, financial condition, operations, prospects or management of Borrower or the Collateral, all in reasonable detail, and Borrower shall advise Agent promptly, in reasonable detail, of: (a) any Lien, other than Permitted Liens, attaching to or asserted against any of the Collateral; (b) any material change in the composition of the Collateral; and (c) the occurrence of any other event which could reasonably be expected to have a Material Adverse Effect.

. The occurrence of any one or more of the following events (regardless of the reason therefor) shall constitute an “Event of Default” under this Agreement:

.

. Except as otherwise provided for in this Agreement and to the fullest extent permitted by Applicable Law, Borrower waives: (a) presentment, demand and protest, and notice of presentment, dishonor, intent to accelerate, acceleration, protest, default, nonpayment, maturity, release, compromise, settlement, extension or renewal of any or all Loan Documents, the Notes or any other notes, commercial paper, Accounts, Contracts, Documents, Instruments, Chattel Paper and guaranties at any time held by Lender on which Borrower may in any way be liable, and hereby ratifies and confirms whatever Lender may do in this regard; (b) all rights to notice and a hearing prior to Lender’s taking possession or control of, or to Lender’s replevin, attachment or levy upon, any Collateral or any bond or security which might be required by any court prior to allowing Lender to exercise any of its remedies; and (c) the benefit of all valuation, appraisal and exemption laws. Borrower acknowledges that it has been advised by counsel with respect to this Agreement, the other Loan Documents and the transactions evidenced hereby and thereby.

. The Proceeds of any sale, disposition or other realization upon any Collateral pursuant to the exercise of the remedies hereunder shall be applied by upon receipt as set forth in Section 2.11.

Each Loan Document shall be binding on and shall inure to the benefit of Borrower, Lenders, Agent and their respective successors and assigns, except as otherwise provided herein or therein. Borrower shall not assign, transfer, hypothecate or otherwise convey its rights, benefits, obligations or duties under any Loan Document without the prior written consent of all of the Lenders, and any such purported assignment, transfer, hypothecation or other conveyance by Borrower without the prior express written consent of the all Lenders shall be void. The terms and provisions of this Agreement and the other Loan Documents are for the purpose of defining the relative rights and obligations of Borrower and Lenders with respect to the transactions contemplated hereby and thereby, and there shall be no third party beneficiaries of any of the terms and provisions of any of the Loan Documents. Subject to Section 12.8.5 of this Agreement, each Lender reserves the right at any time to create and sell a participation in any portion of the Loans and the Loan Documents and to sell, transfer or assign any or all of its rights in the Loans and under the Loan Documents.

. If and to the extent that Section 12.15 is determined by a court of competent jurisdiction to be unenforceable or is otherwise not applied by any such court and that, notwithstanding parties’ intent to have New York law govern all such matters, California law applies to any controversy or claim between or among the parties, their agents and employees, arising under or in connection with (1) this Agreement or any of the other Loan Documents, (2) any negotiations, correspondence or communications relating to this Agreement or any of the other Loan Documents, whether or not incorporated herein or therein, or any indebtedness evidenced hereby or thereby, (3) the administration or management of this Agreement or any of the other Loan Documents or any indebtedness evidenced hereby or thereby, or (4) any alleged agreements, promises, representations or transactions in connection herewith or therewith, including any claim or controversy which arises out of or is based upon an alleged tort (“Dispute”), then such Dispute shall be subject to and resolved in accordance with the Alternative Dispute Resolution Agreement.

. No provision of, or the exercise of any rights under, Section 11.1 shall limit the right of any party to the Alternative Dispute Resolution Agreement to exercise self-help remedies such as set-off, to foreclose against any Collateral, or to obtain provisional or ancillary remedies such as injunctive relief or the appointment of a receiver from a court having jurisdiction before, during or after the pendency of any mediation or arbitration.

. In the event the Dispute becomes subject to the Alternative Dispute Resolution Agreement in accordance with Section 11.1 above, then to the extent any provision of the Alternative Dispute Resolution Agreement is inconsistent with the other terms of this Agreement, the terms of the Alternative Dispute Resolution Agreement shall prevail.

 

. This Agreement and the other Loan Documents constitute the complete agreement among the parties with respect to the subject matter hereof and thereof, supersede all prior agreements, commitments, understandings or inducements (oral or written, expressed or implied).

. Borrower will promptly pay:

.

. Neither Agent’s nor any Lender’s failure, at any time or times, to require strict performance by Borrower of any provision of any Loan Document, nor Agent’s or any Lender’s failure to exercise, nor any delay in exercising, any right, power or privilege under this Agreement, (a) shall waive, affect or diminish any right of such Agent or any Lender thereafter to demand strict compliance and performance therewith, or (b) shall operate as a waiver thereof. Any suspension or waiver of a Default, Event of Default, or other provision under the Loan Documents must be in writing signed by an authorized employee of Agent or any Lender to be effective and shall not suspend, waive or affect any other Default or Event of Default, whether the same is prior or subsequent thereto and whether of the same or of a different type, and shall not be construed as a bar to any right or remedy which Agent or any Lender would otherwise have had on any future occasion.

. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be effective and valid under Applicable Law, but if any provision of any Loan Document shall be prohibited by or invalid under Applicable Law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of such Loan Document. Except as otherwise expressly provided herein or in any other Loan Document, all undertakings, agreements, covenants, warranties and representations of or binding upon Borrower and all rights of Agent and Lender, all as contained in the Loan Documents, shall not terminate or expire, but rather shall survive such termination or cancellation and shall continue in full force and effect until the Termination Date; provided, that the reimbursement and expense provisions of Section 12.2, the indemnity provisions of Section 12.2.5, the governing law and venue provisions of Section 12.14 and the Alternative Dispute Resolution Agreement referred in Sections 11 and 12.15 shall all survive the Termination Date. In the event of a dispute between any of the parties hereto over the meaning of this Agreement, all parties shall be deemed to have been the drafter hereof, and any Applicable Law that states that contracts are construed against the drafter shall not apply.

. Except as otherwise provided in any Loan Document by specific reference to the applicable provisions of this Agreement, if any provision contained in this Agreement is in conflict with, or inconsistent with, any provision in any other Loan Document, the provision contained in this Agreement shall govern and control.

.

AeroCentury Corp.

Attn: Harold M. Lyons

           Christopher B. Tigno

1440 Chapin Avenue, Suite 310

Burlingame, CA 94010-4011

Telephone No.: (650) 340-XXXX

Facsimile No.: (650) 696-XXXX

Email: XXXX@aerocentury.com

           XXXX@aerocentury.com

 

MUFG Union Bank, N.A.

Special Assets Division

Attn: Christopher Petrocelli

          John Lilly

1221 Avenue of Americas, 7th Floor

New York, NY 10020

Email: XXXX@us.mufg.jp

       XXXX@us.mufg.jp

and:

Sheppard Mullin Richter & Hampton LLP

Four Embarcadero Center, 17th Floor

San Francisco, CA 94111-4106

Attn: Juliette M. Ebert, Esq.

Telephone No.: (415) 434-XXXX

Facsimile No.: (415) 434-XXXX

Email: XXXX@sheppardmullin.com

            XXXX@sheppardmullin.com