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Exhibit 10.6
Conformed Copy
SECURITY TRUST AGREEMENT
Dated as of March 3, 1998
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T A B L E O F C O N T E N T S
SECTIONPAGE
ARTICLE I
DEFINITIONS
1.01. Definitions 3
1.02. Construction and Usage 10
ARTICLE II
SECURITY
2.01. Grant of Security 11
2.02. Security for Obligations 14
2.03. Grantors Remain Liable 14
2.04. Delivery of Collateral 14
2.05. Maintenance of Accounts 15
2.06. Maintaining the Non-Trustee Accounts 15
2.07. Representations and Warranties of the Grantors 16
2.08. Further Assurances 17
2.09. Place of Perfection; Records 18
2.10. Voting Rights; Dividends; Etc. 18
2.11. As to the Assigned Agreements and Assigned Leases 19
2.12. Transfers and Other Encumbrances; Additional Shares or Interests 20
2.13. Security Trustee Appointed Attorney-in-Fact 20
2.14. Security Trustee May Perform 21
2.15. Covenant to Pay 21
2.16. As to Permitted Account Investments 21
2.17. As to Irish Law 22
ARTICLE III
REMEDIES
3.01. Remedies 23
ARTICLE IV
REGISTRATION RIGHTS
4.01. Registration Rights 24
ARTICLE V
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SECURITY INTEREST ABSOLUTE
5.01. Security Interest Absolute 25
ARTICLE VI
THE SECURITY TRUSTEE
6.01. Authorization and Action 26
6.02. Absence of Duties 26
6.03. Representations or Warranties 26
6.04. Reliance; Agents; Advice of Counsel 27
6.05. Not Acting in Individual Capacity 28
ARTICLE VII
SUCCESSOR TRUSTEES
7.01. Resignation and Removal of Security Trustee 28
7.02. Appointment of Successor 29
ARTICLE VIII
AGREEMENT AMONG SECURED PARTIES
8.01. Subordination and Priority 30
8.02. Exercise of Remedies 30
8.03. Further Agreements of Subordination 31
8.04. Possession of Collateral 32
8.05. Rights of Subrogation 33
8.06. Further Assurances of Subordinated Representatives 33
8.07. No Change in Rights in Collateral 33
8.08. Waiver of Marshalling and Similar Rights 33
8.09. Enforcement 33
8.10. Obligations Hereunder Not Affected 33
8.11. Waiver 34
8.12. Senior Obligations and Subordinated Obligations Unimpaired 34
8.13. Upon Discharge of Obligations 34
ARTICLE IX
INDEMNITY AND EXPENSES
9.01. Indemnity 35
9.02. Noteholders' Indemnity 35
9.03. No Compensation from Secured Parties 36
9.04. Security Trustee Fees 36
ARTICLE X
MISCELLANEOUS
10.01. Amendments; Waivers; Etc 36
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10.02. Addresses for Notices 37
10.03. No Waiver; Remedies 37
10.04. Severability 37
10.05. Continuing Security Interest; Assignments 37
10.06. Release and Termination 38
10.07. Currency Conversion 38
10.08. Governing Law 39
10.09. Jurisdiction 39
10.10. Counterparts 40
10.11. Table of Contents, Headings, Etc 40
SCHEDULES
Schedule I Pledged Stock, Pledged Beneficial Interest and Pledged Debt
Schedule II Non-Trustee Account Information
Schedule III Trade Names
Schedule IV Chief Place of Business and Chief Executive or Registered Office
EXHIBITS
Exhibit A Form of Credit Facility Provider Supplement
Exhibit B Form of Swap Provider Supplement
Exhibit C Form of Security Trust Agreement Supplement
Exhibit D Form of Account Letter
Exhibit E Form of Consent and Agreement
Exhibit F Form of Service Provider Supplement
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SECURITY TRUST AGREEMENT
SECURITY TRUST AGREEMENT dated as of March 3, 1998, among MORGAN STANLEY
AIRCRAFT FINANCE, a business trust organized under the laws of the State of
Delaware (the "Issuer") pursuant to the Third Amended and Restated Trust
Agreement, dated as of March 3, 1998, among MS Financing Inc., as depositor,
Wilmington Trust Company, as the Delaware Trustee (the "Delaware Trustee"), the
Independent Trustees, the Alternate Controlling Trustee and the Controlling
Trustees party thereto, the ISSUER SUBSIDIARIES (as defined below) listed on
the signature pages hereof (together with the Issuer, the "Grantors"), CABOT
AIRCRAFT SERVICES LIMITED, a company incorporated under the laws of Ireland
(the "Administrative Agent"), BANKERS TRUST COMPANY, a New York banking
corporation (the "Cash Manager"), INTERNATIONAL LEASE FINANCE CORPORATION, a
corporation incorporated under the laws of the State of California ("ILFC"), in
its capacity as servicer (the "Servicer") under the Servicing Agreement (as
defined in the Indenture), INTERNATIONAL LEASE FINANCE CORPORATION, in its
capacity as credit facility provider under the Custody and Loan Agreement (as
defined in the Indenture), MORGAN STANLEY, DEAN WITTER, DISCOVER & CO., as
credit facility provider (together with ILFC as credit facility provider, the
"Initial Credit Facility Providers") under the Loan Agreement (as defined in
the Indenture), BANKERS TRUST COMPANY, not in its individual capacity (except
as otherwise provided in the Indenture (as defined below)), but solely in its
capacity as trustee under the Indenture (in such capacity, the "Trustee"),
BANKERS TRUST COMPANY, as the initial Reference Agent under the Reference
Agency Agreement (as defined in the Indenture) (the "Reference Agent"), and
BANKERS TRUST COMPANY, not in its individual capacity (except as otherwise
provided pursuant to Sections 6.03(i) and (ii)), but solely as the initial
Security Trustee (the "Security Trustee"). All defined terms used herein but
not defined herein shall have meanings given to such terms in the Indenture.
PRELIMINARY STATEMENTS:
(1) The Trustee has entered into an Indenture dated as of the date hereof
with the Issuer (the "Indenture"), pursuant to which the Issuer is issuing the
Notes.
(2) The Issuer is the owner of (i) all of the beneficial interest (the
"Pledged Beneficial Interest") in MSA I, a business trust organized under the
laws of the State of Delaware ("MSA I"), as described in Schedule I hereto,
(ii) the indebtedness of MSA I and the other Issuer Subsidiaries (the "Pledged
Debt") described in Schedule I hereto and (iii) all of the outstanding shares
of common stock (the "SPC-5 Shares") of Aircraft SPC-5, Inc., a corporation
organized under the laws of the State of California ("SPC-5 "), all of the
outstanding ordinary shares (the "Redfly Shares") of Redfly (UK) Limited, a
limited liability company organized under the laws of the United Kingdom
("Redfly"), and all of the outstanding ordinary shares (the "Greenfly Shares")
of Greenfly (Ireland) Limited, a limited liability company organized under the
laws of the Republic of Ireland ("Greenfly"), described in Schedule I hereto.
The SPC-5 Shares, the Redfly Shares and the Greenfly Shares are referred to
herein as the "Pledged Stock".
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(3) In accordance with the terms of the Indenture, the Issuer may enter
into one or more Credit Facilities from time to time providing that each
provider thereunder is entitled to the benefits of this Agreement. Upon the
execution and delivery to the Security Trustee of a supplement to this
Agreement in substantially the form of Exhibit A hereto (a "Credit Facility
Provider Supplement") by each provider of any such Credit Facility, such
facility shall, together with each Credit Facility provided by each Initial
Credit Facility Provider, be a "Secured Credit Facility" hereunder and each
provider party thereto shall, together with each Initial Credit Facility
Provider, be a "Secured Credit Facility Provider" hereunder.
(4) MSA I, SPC-5, Redfly and Greenfly are parties to lease and sub-lease
contracts with respect to the Initial Aircraft and may enter into lease and
sub-lease contracts with respect to Additional Aircraft.
(5) In accordance with Section 9.05(a) of the Indenture, the Issuer may
enter into one or more Swap Agreements from time to time providing that each
Swap Provider party thereto is entitled to the benefits of the security under
this Agreement. Upon the execution and delivery to the Security Trustee of a
supplement to this Agreement in substantially the form of Exhibit B hereto (a
"Swap Provider Supplement") by each Swap Provider party to any such Swap
Agreement, such Swap Agreement shall be a "Secured Swap Agreement" hereunder
and each Swap Provider party thereto shall be a "Secured Swap Provider"
hereunder.
(6) In accordance with the terms of the Indenture, the Issuer may enter
into one or more agreements providing for services to MSAF Group in addition to
the Service Provider Documents from time to time providing that each provider
thereunder is entitled to the benefits of this Agreement. Upon the execution
and the delivery to the Security Trustee of a supplement to this Agreement in
substantially the form of Exhibit F hereto by each such party to any such
Agreement, such agreement shall be a "Service Provider Supplement" hereunder
and each provider thereto shall be a "Secured Service Provider" hereunder.
(7) In accordance with the terms of the Indenture, the Guarantor
Noteholders are entitled to the benefits of the security under this Agreement
upon the fulfillment of certain conditions. Upon the execution and delivery to
the Security Trustee of a supplement to this Agreement in substantially the
form of Exhibit C hereto (a "Security Trust Agreement Supplement") by the
Guarantor and/or any Guarantor Subsidiary, the Guarantee in respect of such
Guarantor Noteholders shall be a "Secured Guarantee" hereunder and such
Guarantor Noteholders shall be "Secured Guarantor Noteholders" hereunder.
(8) The Issuer and the Issuer Subsidiaries may from time to time grant
additional security for the benefit of the Noteholders and the other Secured
Parties (as defined below). Upon the execution and delivery to the Security
Trustee of a Security Trust Agreement Supplement by the Issuer or any Issuer
Subsidiary, the Secured Parties shall be entitled to the benefit of the
Collateral thereunder.
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(9) It is a condition precedent to the issuance of the Notes by the Issuer
that each Grantor shall have granted the assignments and security interests and
made the pledges and assignments contemplated by this Agreement.
(10) Each Grantor shall derive substantial direct and indirect benefit
from the transactions contemplated by the Indenture and the other Relevant
Documents.
NOW, THEREFORE, in consideration of the premises, each Grantor hereby
agrees with the Security Trustee for its benefit and the benefit of the other
Service Providers, the Noteholders, the Secured Credit Facility Providers, the
Secured Swap Providers, the Secured Service Providers and the Secured Guarantor
Noteholders (each, a "Secured Party" and, collectively, the "Secured Parties")
as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. (a) Certain Defined Terms. As used herein,
the following terms have the meanings set forth below:
"1881 Act" has the meaning specified in Section 2.17.
"Acceleration Default" means any Event of Default of the type
described in Section 4.01(f) or 4.01(g) of the Indenture.
"Account Letters" has the meaning specified in Section 2.06(a).
"Additional Grantor" has the meaning specified in Section 10.01.
"Administrative Agent" has the meaning specified in the recital of
parties to this Agreement.
"Agreed Currency" has the meaning specified in Section 10.07.
"Agreement Collateral" has the meaning specified in Section 2.01.
"Assigned Leases" has the meaning specified in Section 2.01.
"Bankers Trust Fee Letter" means the fee agreement dated as of March
3, 1998 between the Issuer and Bankers Trust.
"Beneficial Interest Collateral" has the meaning specified in
Section 2.01.
"Cash Collateral" has the meaning specified in Section 2.01.
"Cash Manager" has the meaning specified in the recital of parties
to this
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Agreement.
"Certificated Security" means (i) a certificated security as defined
in Section 8-102(a)(4) of the UCC and (ii) any security entitlement as
defined in Section 8-102(a)(17) of the UCC with respect thereto, but does
not include any Government Security.
"Class" means any class of MSAF Group Notes.
"Collateral" has the meaning specified in Section 2.01.
"Credit Facility Provider Supplement" has the meaning specified in
the preliminary statements to this Agreement or such other agreement
approved by the Administrative Agent providing for a credit facility
provider to become a Secured Party hereunder.
"Delaware Trustee" has the meaning specified in the recital of
parties to this Agreement.
"Delaware Trustee Fee Agreements" means the fee agreements dated as
of March 3, 1998 between the Delaware Trustee and, respectively, the
Issuer and MSA I.
"Government Security" means (i) any security issued or guaranteed by
the United States of America or an agency or instrumentality thereof that
is maintained in book-entry on the records of the Federal Reserve Bank of
New York and (ii) any security entitlement as defined in Section
8-102(a)(17) of the UCC with respect thereto.
"Grantors" has the meaning specified in the recital of parties to
this Agreement.
"Greenfly" has the meaning specified in the preliminary statements
to this Agreement.
"Greenfly Shares" has the meaning specified in the preliminary
statements to this Agreement.
"ILFC" has the meaning specified in the recital of parties to this
Agreement.
"Indenture" has the meaning specified in the preliminary statements
to this Agreement.
"Indenture Obligations" means, in respect of any Class of MSAF Group
Notes, all obligations of the Issuer and any Guarantor under and in
respect of such Class of MSAF Group Notes and the Guarantees, if any, of
such Class of MSAF Group Notes, including, without limitation, all
obligations of the Issuer and any
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Guarantor to make payments of principal of, interest on (including
interest following the filing of a petition initiating any proceeding
referred to in Section 8.03(a)) and Premium, if any, on such Class of
MSAF Group Notes, all obligations to pay any fees, expenses or other
amounts under or in respect of such Class of MSAF Group Notes, the
Indenture, any Guarantor Indenture or any Relevant Document in respect of
such Class of MSAF Group Notes, and all obligations in respect of any
amendment, modification, extension, renewal or refinancing of such Class
of MSAF Group Notes.
"Initial Credit Facility Providers" has the meaning specified in the
recital of parties to this Agreement.
"Instrument" means any "instrument" as defined in Section
9-105(1)(i) of the UCC.
"Investment Collateral" has the meaning specified in Section 2.01.
"Issuer" has the meaning specified in the recital of parties to this
Agreement.
"Lease Collateral" has the meaning specified in Section 2.01.
"MSA I" has the meaning specified in the preliminary statements to
this Agreement.
"Non-Trustee Account Banks" has the meaning specified in Section
2.06.
"Non-Trustee Account Collateral" has the meaning specified in
Section 2.01.
"Noteholder" means any Person in whose name an MSAF Group Note is
registered from time to time in the register for the MSAF Group Notes.
"Obligor" has the meaning specified in Section 2.06.
"Pledged Beneficial Interest" has the meaning specified in the
preliminary statements to this Agreement.
"Pledged Debt" has the meaning specified in the preliminary
statements to this Agreement.
"Pledged Stock" has the meaning specified in the preliminary
statements to this Agreement.
"Primary Eligible Credit Facility Obligations" means the obligations
of the Issuer and any Guarantor now or hereafter existing under any
Primary Eligible Credit Facilities.
"Received Currency" has the meaning specified in Section 10.07.
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"Redfly" has the meaning specified in the preliminary statements to
this Agreement.
"Redfly Shares" has the meaning specified in the preliminary
statements to this Agreement.
"Reference Agent" has the meaning specified in the recital of
parties to this Agreement.
"Secured Credit Facility" has the meaning specified in the
preliminary statements to this Agreement.
"Secured Credit Facility Provider" has the meaning specified in the
preliminary statements to this Agreement.
"Secured Guarantee" has the meaning specified in the preliminary
statements to this Agreement.
"Secured Guarantor Noteholders" has the meaning specified in the
preliminary statements to this Agreement.
"Secured Obligations" has the meaning specified in Section 2.02.
"Secured Other Credit Facility Obligations" means the obligations of
the Issuer and any Guarantor now or hereafter existing under any Credit
Facilities other than the Primary Eligible Credit Facilities.
"Secured Party" has the meaning specified in the preliminary
statements to this Agreement.
"Secured Service Provider" has the meaning specified in the
preliminary statements to this Agreement.
"Secured Subordinated Swap Provider Obligations" means the
obligations of the Issuer and any Guarantor now or hereafter existing
under the Secured Swap Agreements that are subordinated to payments
having the priorities specified in Section 3.08 of the Indenture or any
Guarantor Indenture.
"Secured Swap Agreement" has the meaning specified in the
preliminary statements to this Agreement.
"Secured Swap Provider" has the meaning specified in the preliminary
statements to this Agreement.
"Secured Swap Provider Obligations" means the obligations of the
Issuer now or hereafter existing under the Secured Swap Agreements other
than Secured Subordinated Swap Provider Obligations.
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"Securities Account" means a securities account as defined in
Section 8-501 of the UCC maintained in the name of the Trustee with a
Securities Intermediary in the State of New York.
"Securities Intermediary" means any "securities intermediary" of the
Security Trustee as defined in 31 C.F.R. Section 357.2, Section
8-102(a)(14) of the UCC or any similar provision of state or federal law.
"Security Collateral" has the meaning specified in Section 2.01(a).
"Security Trust Agreement Supplement" has the meaning specified in
the preliminary statements to this Agreement.
"Security Trustee" has the meaning specified in the recital of
parties to this Agreement.
"Senior Creditors" means, at any time, the holders and owners of
Senior Obligations.
"Senior Obligations" means:
(i) with respect to the Secured Primary Eligible Credit
Facility Obligations, the Service Provider Obligations;
(ii) with respect to the Indenture Obligations in respect of
the MSAF Group Class A Notes and the Secured Swap Provider
Obligations, (A) the Secured Primary Eligible Credit Facility
Obligations and (B) the Service Provider Obligations;
(iii) with respect to the Indenture Obligations in respect of
the MSAF Group Class B Notes, (A) the Indenture Obligations in
respect of the MSAF Group Class A Notes, (B) the Secured Swap
Provider Obligations, (C) the Secured Primary Eligible Credit
Facility Obligations and (D) the Service Provider Obligations;
(iv) with respect to the Indenture Obligations in respect of
the MSAF Group Class C Notes, (A) the Indenture Obligations in
respect of the MSAF Group Class B Notes, (B) the Indenture
Obligations in respect of the MSAF Group Class A Notes, (C) the
Secured Swap Provider Obligations, (D) the Secured Primary Eligible
Credit Facility Obligations and (E) the Service Provider
Obligations;
(v) with respect to the Indenture Obligations in respect of
the MSAF Group Class D Notes, (A) the Indenture Obligations in
respect of the MSAF Group Class C Notes, (B) the Indenture
Obligations in respect of the MSAF Group Class B Notes, (C) the
Indenture Obligations with respect to
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the MSAF Group Class A Notes, (D) the Secured Swap Provider
Obligations, (E) the Secured Primary Eligible Credit Facility
Obligations and (F) the Service Provider Obligations;
(vi) with respect to the Secured Other Credit Facility
Obligations, (A) the Indenture Obligations in respect of the MSAF
Group Class D Notes, (B) the Indenture Obligations in respect of
the MSAF Group Class C Notes, (C) the Indenture Obligations in
respect of the MSAF Group Class B Notes, (D) the Indenture
Obligations in respect of the MSAF Group Class A Notes, (E) the
Secured Swap Provider Obligations, (F) the Secured Primary Eligible
Credit Facility Obligations and (G) the Service Provider
Obligations; and
(vii) with respect to the Secured Subordinated Swap Provider
Obligations, (A) the Secured Other Credit Facility Obligations, (B)
the Indenture Obligations in respect of the MSAF Group Class D
Notes, (C) the Indenture Obligations in respect of the MSAF Group
Class C Notes, (D) the Indenture Obligations in respect of the MSAF
Group Class B Notes, (E) the Indenture Obligations in respect of
the MSAF Group Class A Notes, (F) the Secured Swap Provider
Obligations, (G) the Secured Primary Eligible Credit Facility
Obligations and (H) the Service Provider Obligations.
"Senior Representative" means the Senior Trustee; provided, however,
that if, at any time prior to the payment in full of the Service Provider
Obligations, the holders of a majority in interest of the accrued and
unpaid Service Provider Obligations at such time agree upon another
Person to serve as Senior Representative, such Person shall be the Senior
Representative until the payment in full of the Service Provider
Obligations.
"Service Provider Documents" means the Administrative Agency
Agreement, the Trust Agreement, the Cash Management Agreement, the
Indenture, any Guarantor Indenture, the Reference Agency Agreement, the
Servicing Agreement, the Financial Advisory Agreement, any Additional
Servicing Agreement, the Bankers Trust Fee Agreement, the Delaware
Trustee Fee Agreements and this Agreement.
"Service Provider Obligations" means, collectively, the obligations
now or hereafter existing of the Issuer or any MSAF Group Member to pay
fees, expenses, indemnities and other amounts under the Service Provider
Documents (other than the Secured Primary Eligible Credit Facility
Obligations, the Secured Swap Provider Obligations, the Indenture
Obligations in respect of the MSAF Group Class A Notes, the Indenture
Obligations in respect of the MSAF Group Class B Notes, the Indenture
Obligations in respect of the Class C Notes, the Indenture Obligations in
respect of the MSAF Group Class D Notes, the Secured Other Credit
Facility Obligations and the Secured Subordinated Swap Provider
Obligations).
"Service Provider Supplement" has the meaning given to such term in
the preliminary statements to this Agreement.
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"Servicer" has the meaning specified in the preliminary statements
to this Agreement.
"SPC-5" has the meaning specified in the preliminary statements to
this Agreement.
"SPC-5 Shares" has the meaning specified in the preliminary
statements to this Agreement.
"Subordinated Creditors" means, at any time, the holders and owners
of Subordinated Obligations.
"Subordinated Obligations" means:
(i) with respect to the Service Provider Obligations, (A) the
Secured Primary Eligible Credit Facility Obligations, (B) the
Indenture Obligations in respect of the MSAF Group Class A Notes
and the Secured Swap Provider Obligations, (C) the Indenture
Obligations in respect of the MSAF Group Class B Notes, (D) the
Indenture Obligations in respect of the MSAF Group Class C Notes,
(E) the Indenture Obligations in respect of the MSAF Group Class D
Notes, (F) the Secured Other Credit Facility Obligations and (G)
the Secured Subordinated Swap Provider Obligations;
(ii) with respect to the Secured Primary Eligible Credit
Facility Obligations, (A) the Indenture Obligations in respect of
the MSAF Group Class A Notes and the Secured Swap Provider
Obligations, (B) the Indenture Obligations in respect of the MSAF
Group Class B Notes, (C) the Indenture Obligations in respect of
the MSAF Group Class C Notes, (D) the Indenture Obligations in
respect of the MSAF Group Class D Notes, (E) the Secured Other
Credit Facility Obligations and (F) the Secured Subordinated Swap
Provider Obligations;
(iii) with respect to the Indenture Obligations in respect of
the MSAF Group Class A Notes and the Secured Swap Provider
Obligations, (A) the Indenture Obligations in respect of the MSAF
Group Class B Notes, (B) the Indenture Obligations in respect of
the MSAF Group Class C Notes, (C) the Indenture Obligations in
respect of the MSAF Group Class D Notes, (D) the Secured Other
Credit Facility Obligations and (E) the Secured Subordinated Swap
Provider Obligations;
(iv) with respect to the Indenture Obligations in respect of
the MSAF Group Class B Notes, (A) the Indenture Obligations in
respect of the MSAF Group Class C Notes, (B) the Indenture
Obligations in respect of the MSAF Group Class D Notes, (C) the
Secured Other Credit Facility Obligations and (D) the Secured
Subordinated Swap Provider Obligations;
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(v) with respect to the Indenture Obligations in respect of
the MSAF Group Class C Notes, (A) the Indenture Obligations in
respect of the MSAF Group Class D Notes, (B) the Secured Other
Credit Facility Obligations and (C) the Secured Subordinated Swap
Provider Obligations;
(vi) with respect to the Indenture Obligations in respect of
the MSAF Group Class D Notes, (A) the Secured Other Credit Facility
Obligations and (B) the Secured Subordinated Swap Provider
Obligations; and
(vii) with respect to the Secured Other Credit Facility
Obligations, the Secured Subordinated Swap Provider Obligations.
"Subordinated Representative" means, at any time, any trustee or
representative of any holders or owners of any obligations other than the
Senior Representative at such time.
"Swap Provider Supplement" has the meaning specified in the
preliminary statements to this Agreement or such other agreement approved
by the Administrative Agent providing for a Swap Provider to become a
Secured Party hereunder.
"Trustee" has the meaning specified in the recital of parties to
this Agreement.
"UCC" means the Uniform Commercial Code as in effect on the date
hereof in the State of New York; provided that if by reason of mandatory
provisions of law, the perfection or the effect of perfection or
non-perfection of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than New
York, "UCC" means the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection.
"Uncertificated Security" means (i) an uncertificated security as
defined in Section 8-102(a)(18) of the UCC and (ii) any security
entitlement as defined in Section 8-102(a)(17) of the UCC with respect
thereto, but does not include any Government Security.
(b) Terms Defined in the Indenture. For all purposes of this Agreement,
all capitalized terms used herein but not defined herein shall have the
respective meanings assigned to such terms in the Indenture.
SECTION 1.02. Construction and Usage.02. Construction and Usage. The
conventions of construction and usage set forth in the Indenture are hereby
incorporated by reference herein.
ARTICLE II
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SECURITY
SECTION 2.01. Grant of Security. Each Grantor hereby assigns and pledges
to the Security Trustee for its benefit and the benefit of the Secured Parties,
and hereby grants to the Security Trustee for its benefit and the benefit of
the Secured Parties a security interest in all of its right, title and interest
in and to the following (collectively, the "Collateral"):
(a) with respect to each Grantor, all of the following (the
"Security Collateral"):
(i) the Pledged Stock and the certificates representing such
Pledged Stock, and all dividends, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the
Pledged Stock;
(ii) the Pledged Debt and the instruments evidencing the
Pledged Debt, and all interest, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the
Pledged Debt;
(iii) all additional shares of Stock from time to time
acquired by such Grantor in any manner, including the Stock of any
MSAF Group Member that may be formed from time to time, and the
certificates representing such additional shares and all dividends,
cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange
for any or all such additional shares; and
(iv) all additional indebtedness from time to time owed to
such Grantor by any MSAF Group Member and the instruments
evidencing such indebtedness, and all interest, cash, instruments
and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all
of such indebtedness;
(b) with respect to each Grantor, all of the following (the
"Beneficial Interest Collateral"):
(i) the Pledged Beneficial Interest, all certificates, if any,
from time to time representing all of such Grantor's right, title
and interest in the Pledged Beneficial Interest and all
distributions, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect of or
in exchange for any or all of the Pledged Beneficial Interest; and
(ii) all of such Grantor's right, title and interest in all
additional
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beneficial interests from time to time acquired by such Grantor in
any manner, all certificates, if any, from time to time
representing such additional beneficial interests and all
distributions, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect of or
in exchange for any or all such additional beneficial interests;
(c) with respect to each Grantor, all of the following
(collectively, the "Non-Trustee Account Collateral"):
(i) all of the Non-Trustee Accounts in such Grantor's name,
all funds or any other interest held or required by the terms of
the Indenture or any Guarantor Indenture to be held therein and all
certificates and instruments, if any, from time to time
representing or evidencing such Non-Trustee Accounts;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution for or in addition to any or all of
the then existing Non-Trustee Account Collateral; and
(iii) all interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the then
existing Non-Trustee Account Collateral;
(d) with respect to each Grantor, all of the following
(collectively, the "Cash Collateral"):
(i) all funds or any other interest of such Grantor held or
required by the terms of the Indenture or any Guarantor Indenture
to be held in the Accounts and all certificates and instruments, if
any from time to time representing or evidencing such funds;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution for or in addition to any or all of
the then existing Cash Collateral; and
(iii) all interest, dividends, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing Cash
Collateral;
(e) all "investment property" (as defined in Section 9-115(1)(f) of
the UCC) of each Grantor and all of the following (the "Investment
Collateral"):
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(i) all Permitted Account Investments made or acquired from or
with the proceeds of any Non-Trustee Account Collateral or Cash
Collateral of such Grantor from time to time and all certificates
and instruments, if any, from time to time representing or
evidencing such Permitted Account Investments;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution of or in addition to any or all of
the then existing Investment Collateral; and
(iii) all interest, dividends, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing
Investment Collateral;
(f) with respect to the Issuer, all of the following (the "Agreement
Collateral"):
(i) all of such Grantor's right, title and interest in and to
all security assignments, cash deposit agreements and other
security agreements executed in its favor by any Issuer Subsidiary,
in each case as such agreements may be amended or otherwise
modified from time to time (collectively, the "Assigned
Agreements"); and
(ii) all of such Grantor's right, title and interest in and to
all deposit accounts, all funds held therein, all certificates and
instruments, if any from time to time representing or evidencing
such deposit accounts and all other property of whatever nature, in
each case pledged, assigned or transferred to it or mortgaged or
charged in its favor pursuant to any Assigned Agreement;
(g) with respect to each of MSA I, SPC-5, Redfly and Greenfly, all
of the following (the "Lease Collateral"):
(i) all of such Grantor's right, title and interest in and to
all Leases to which such Grantor is or may from time to time be
party and any leasing arrangements among MSAF Group Members with
respect to such Leases (all such Leases, the "Assigned Leases"),
including without limitation, (A) all rights of such Grantor to
receive moneys due and to become due under or pursuant to such
Assigned Leases, (B) all rights of such Grantor to receive proceeds
of any insurance, indemnity, warranty or guaranty with respect to
such Assigned Leases, (C) claims of such Grantor for damages
arising out of or for breach or default under such Assigned Leases
and (D) the right of such Grantor to terminate such Assigned
Leases, to perform thereunder and to compel performance and
otherwise exercise all
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remedies thereunder, whether arising under such Assigned Leases or
by statute or at law or in equity; and
(h) all proceeds of any and all of the foregoing Collateral
(including, without limitation, proceeds that constitute property of the
types described in subsections (a), (b), (c), (d), (e), (f) and (g) of
this Section 2.01).
SECTION 2.02. Security for Obligations. This Agreement secures the
payment and performance of all obligations of the Issuer and each other
Grantor, now or hereafter existing under the Service Provider Documents, the
MSAF Group Notes, the Secured Guarantee, the Secured Credit Facilities and the
Secured Swap Agreements, whether for principal, interest, fees, expenses or
otherwise (all such obligations of each Grantor being, collectively, the
"Secured Obligations"). Without limiting the generality of the foregoing, this
Agreement secures the payment of all amounts that constitute part of the
Secured Obligations and would be owed by any Grantor to the Secured Parties
under the Secured Obligations but for the fact that they are unenforceable or
not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such Grantor.
SECTION 2.03. Grantors Remain Liable. Anything contained herein to the
contrary notwithstanding, (a) each Grantor shall remain liable under the
contracts and agreements included in the Collateral to the extent set forth
therein to perform all of its duties and obligations thereunder to the same
extent as if this Agreement had not been executed, (b) the exercise by the
Security Trustee of any of its rights hereunder shall not release any Grantor
from any of its duties or obligations under the contracts and agreements
included in the Collateral, and (c) no Secured Party shall have any obligation
or liability under the contracts and agreements included in the Collateral by
reason of this Agreement, nor shall any Secured Party be obligated to perform
any of the obligations or duties of any Grantor thereunder or to take any
action to collect or enforce any claim for payment assigned hereunder.
SECTION 2.04. Delivery of Collateral. All certificates or instruments
representing or evidencing any Collateral shall be delivered to and held by or
on behalf of the Security Trustee pursuant hereto and shall be in suitable form
for transfer by delivery, or shall be accompanied by duly executed instruments
of transfer or assignment in blank, all in form and substance satisfactory to
the Security Trustee. The Security Trustee shall have the right, at any time in
its discretion and without notice to the Issuer, to transfer to or to register
in the name of the Security Trustee or any of its nominees any or all of the
Pledged Stock and Pledged Beneficial Interest, subject only to the revocable
rights specified in Section 2.10(a). In addition, the Security Trustee shall
have the right at any time to exchange certificates or instruments representing
or evidencing any Collateral for certificates or instruments of smaller or
larger denominations.
SECTION 2.05. Maintenance of Accounts. So long as any Secured
Obligations shall remain unpaid, the Security Trustee shall have sole dominion
and control over each Account other than any Non-Trustee Account, and no
Grantor shall, at any time, establish any bank account other than pursuant to
Article III of the Indenture, any Guarantor Indenture or in compliance with
Section 2.06(a).
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SECTION 2.06. Maintaining the Non-Trustee Accounts. So long as any
Secured Obligations shall remain unpaid:
(a) Each Grantor shall maintain each Non-Trustee Account in its name
only with banks ("Non-Trustee Account Banks") that have entered into
letter agreements in substantially the form of Exhibit D hereto (or made
such other arrangements as are acceptable to the Administrative Agent)
with such Grantor and the Security Trustee (the "Account Letters").
(b) Each Grantor (i) shall immediately instruct each Person
obligated at any time to make any payment to such Grantor for any reason
(an "Obligor") to make such payment to an Account or a Non-Trustee
Account meeting the requirements of Section 2.06(a), (ii) shall instruct
each of its Non-Trustee Account Banks to transfer to the Collection
Account, in immediately available funds, within one Business Day of
receipt thereof, an amount equal to the credit balance of the Non-Trustee
Account in such Non-Trustee Account Bank (other than any amount required
to be left on deposit for local tax or other regulatory or legal
purposes), and (iii) shall transfer or cause its Non-Trustee Account
Banks to transfer to the Security Trustee for deposit in the Collection
Account, within each Business Day, all other proceeds of Non-Trustee
Account Collateral, Cash Collateral and proceeds of Collateral.
(c) Upon any termination of any Account Letter or other agreement
with respect to the maintenance of a Non-Trustee Account by any Grantor
or any Non-Trustee Account Bank, such Grantor shall immediately notify
all Obligors that were making payments to such Non-Trustee Account to
make all future payments to an Account or to another Non-Trustee Account
meeting the requirements of Section 2.06(a). Subject to the terms of any
Lease, upon request by the Security Trustee, each Grantor shall, and if
prohibited from so doing by the terms of any Lease, shall use its best
efforts to seek the consent of the relevant lessee to, terminate any or
all of its Non-Trustee Accounts.
SECTION 2.07. Representations and Warranties of the Grantors. Each
Grantor represents and warrants as of the date of this Agreement and as of each
subsequent Closing Date as follows:
(a) Each Grantor is the legal and beneficial owner of the Collateral
pledged and assigned by it hereunder free and clear of any Encumbrance,
other than the security interest created by this Agreement. No effective
financing statement or other instrument similar in effect covering all or
any part of the Collateral is on file in any recording office, except
such as may have been filed in favor of the Security Trustee relating to
this Agreement.
(b) This Agreement, the pledge of the Security Collateral pursuant
hereto and the pledge and assignment on the date hereof and from time to
time hereafter of the other Collateral pursuant hereto create a valid and
perfected security interest
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therein, securing the payment of the Secured Obligations, subject in
priority to no other claims, and all filings and other actions necessary
or desirable to perfect and protect such security interest have been duly
taken.
(c) No Grantor has any trade names except as set forth on Schedule
III hereto.
(d) No consent of any other Person and no authorization, approval or
other action by, and no notice to or filing with, any governmental
authority or regulatory body or other third party is required either (i)
for the grant by such Grantor of the assignment and security interest
granted hereby, for the execution, delivery or performance of this
Agreement by such Grantor or (ii) for the perfection or maintenance of
the pledge, assignment and security interest created hereby, except for
the filing of financing and continuation statements under the Uniform
Commercial Code.
(e) The chief place of business and chief executive or registered
office of such Grantor and the office where such Grantor keeps records of
each Assigned Lease to which it is a party are located at the address
specified opposite the name of such Grantor on Schedule IV hereto.
(f) The Pledged Stock constitutes the percentage of the issued and
outstanding shares of stock of the issuers thereof indicated on Schedule
I hereto. The Pledged Beneficial Interest constitutes the percentage of
the beneficial interest of the issuer thereof indicated on Schedule I
hereto.
(g) The Pledged Stock and the Pledged Beneficial Interest have been
duly authorized and validly issued and are fully paid up and
nonassessable. The Pledged Debt has been duly authorized, authenticated
or issued and delivered, is the legal, valid and binding obligation of
each obligor thereunder and is not in default.
(h) The Assigned Agreements and the Assigned Leases, true and
complete copies of which have been furnished to the Security Trustee,
have been duly authorized, executed and delivered by the relevant
Grantors, have not been amended or otherwise modified, are in full force
and effect and are binding upon and enforceable against all parties
thereto in accordance with their terms. There exists no default under
any Assigned Agreement or any Assigned Lease by any Grantor party
thereto. Each party to any Assigned Agreements (there being none as of
the date of this Agreement) other than the Issuer and the Security
Trustee has executed and delivered to the Security Trustee a consent, in
substantially the form of Exhibit E (or any other form approved in
writing by the Administrative Agent), to the assignment of the relevant
Agreement Collateral to the Security Trustee pursuant to this Agreement.
Each party other than any Grantor to any Assigned Lease which by its
terms requires the lessor thereof to obtain the consent of the lessee
thereof, has executed and delivered to the Security Trustee a consent, in
substantially the form of Exhibit E (or any other form approved in
writing by the Administrative Agent), to the assignment of the relevant
Lease Collateral to the
21
Security Trustee pursuant to this Agreement. Each party to any other
Assigned Lease other than any Grantor has been given due notice of the
assignment of the relevant Lease Collateral to the Security Trustee
pursuant to this Agreement.
SECTION 2.08. Further Assurances. (a) Each Grantor agrees that from
time to time, at the expense of such Grantor, such Grantor shall promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Security Trustee may
request, in order to perfect and protect any pledge, assignment or security
interest granted or purported to be granted hereby or to enable the Security
Trustee to exercise and enforce its rights and remedies hereunder with respect
to any Collateral. Without limiting the generality of the foregoing, each
Grantor shall: (i) mark conspicuously each Assigned Agreement and Assigned
Lease to which it is a party and each of its records pertaining to the
Collateral with a legend, indicating that such Collateral is subject to the
security interest granted hereby; (ii) if any Collateral shall be evidenced by
a promissory note or other instrument or chattel paper, deliver and pledge to
the Security Trustee hereunder such note or instrument or chattel paper duly
indorsed and accompanied by duly executed instruments of transfer or
assignment; and (iii) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments or notices, as
may be necessary or desirable, or as the Security Trustee may request, in order
to perfect and preserve the pledge, assignment and security interest granted or
purported to be granted hereby.
(b) Each Grantor hereby authorizes the Security Trustee to file one or
more financing or continuation statements, and amendments thereto, relating to
all or any part of the Collateral without the signature of such Grantor where
permitted by law. A photocopy or other reproduction of this Agreement or any
financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.
(c) Each Grantor shall furnish to the Security Trustee from time to time
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Security Trustee
may reasonably request, all in reasonable detail.
(d) Each Grantor shall, immediately upon the organization or acquisition
by such Grantor of any Issuer Subsidiary or Guarantor Subsidiary, cause such
Issuer Subsidiary or Guarantor Subsidiary, as the case may be, to enter into a
Security Trust Agreement Supplement.
SECTION 2.09. Place of Perfection; Records. Each Grantor shall keep its
chief place of business and chief executive office and the office where it
keeps its records concerning the Collateral at the location therefor specified
in Schedule IV or, upon 30 days' prior written notice to the Security Trustee,
at such other locations in a jurisdiction where all actions required by Section
2.07(e) shall have been taken with respect to the Collateral. Each Grantor
shall hold and preserve such records and shall permit representatives of the
Security Trustee at any time during normal business hours to inspect and make
abstracts from such records, all at the sole cost and expense of such Grantor.
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SECTION 2.10. Voting Rights; Dividends; Etc. (a) So long as no Default
Notice shall have been delivered to the Issuer or any Guarantor and no
Acceleration Default shall have occurred and be continuing:
(i) Each of the Grantors shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Security Collateral
and Beneficial Interest Collateral pledged by such Grantor or any part
thereof for any purpose not inconsistent with the terms of this
Agreement, the charter documents of such Grantor, the Indenture and any
Guarantor Indenture; provided, however, that such Grantor shall not
exercise or refrain from exercising any such right if in its judgment
such action would have a material adverse effect on the value of the
Security Collateral or the Beneficial Interest Collateral or any part
thereof.
(ii) The Security Trustee shall execute and deliver (or cause to be
executed and delivered) to such Grantor all such proxies and other
instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and other rights that it is
entitled to exercise pursuant to Section 2.10(a)(i).
(iii) Each Grantor shall be entitled to receive and retain any and
all distributions, dividends and interest paid in respect of the Security
Collateral and Beneficial Interest Collateral pledged by such Grantor;
provided, however, that any and all
(A) distributions, dividends and interest paid or payable
other than in cash in respect of, and instruments and other
property received, receivable or otherwise distributed in respect
of, or in exchange for, such Security Collateral or Beneficial
Interest Collateral;
(B) distributions, dividends and other distributions paid or
payable in cash in respect of such Security Collateral or
Beneficial Interest Collateral in connection with a partial or
total liquidation or dissolution or in connection with a reduction
of capital, capital surplus or paid-in surplus; and
(C) cash paid, payable or otherwise distributed in respect of
principal of, or in redemption of, or in exchange for, such
Security Collateral or Beneficial Interest Collateral
shall be, and shall be forthwith delivered to the Security Trustee to
hold as, Security Collateral or Beneficial Interest Collateral, as the
case may be, and, if received by such Grantor, shall be received in trust
for the benefit of the Security Trustee, be segregated from the other
property or funds of the Security Trustee and be forthwith delivered to
the Security Trustee as Security Collateral or Beneficial Interest
Collateral, as the case may be, in the same form as so received (with any
necessary indorsement).
23
(b) Upon notice to such Grantor by the Security Trustee following the
delivery of a Default Notice to such Grantor or following the occurrence and
during the continuance of an Acceleration Default, all rights of such Grantor
(i) to exercise or refrain from exercising the voting and other consensual
rights that it would otherwise be entitled to exercise pursuant to Section
2.10(a)(i) and (ii) to receive the distributions, dividends and interest
payments that it would otherwise be entitled to receive and retain pursuant to
Section 2.10(a)(iii) shall cease, and all such rights shall thereupon become
vested in the Security Trustee, which shall thereupon have the sole right to
exercise or refrain from exercising such voting and other consensual rights.
(c) All distributions, dividends and interest payments that are received
by such Grantor contrary to the provisions of Section 2.10(a) or (b) shall be
received in trust for the benefit of the Security Trustee, shall be segregated
from other funds of such Grantor and shall be forthwith paid over to the
Security Trustee as Security Collateral or Beneficial Interest Collateral, as
the case may be, in the same form as so received (with any necessary
indorsement).
SECTION 2.11. As to the Assigned Agreements and Assigned Leases. (a)
Each Grantor shall at its expense:
(i) perform and observe all the terms and provisions of the Assigned
Agreements and Assigned Leases to be performed or observed by it,
maintain the Assigned Agreements and Assigned Leases in full force and
effect, enforce the Assigned Agreements and Assigned Leases in accordance
with their terms and take all such action to such end as may be from time
to time requested by the Security Trustee; and
(ii) furnish to the Security Trustee promptly upon receipt thereof
copies of all notices, requests and other documents received by such
Grantor under or pursuant to the Assigned Agreements or Assigned Leases,
and from time to time (A) furnish to the Security Trustee such
information and reports regarding the Collateral as the Security Trustee
may reasonably request and (B) upon request of the Security Trustee make
to each other party to any Assigned Agreement or Assigned Lease such
demands and requests for information and reports or for action as such
Grantor is entitled to make thereunder.
(b) No Grantor shall cancel or terminate any Assigned Agreement or consent
to or accept any cancellation or termination thereof or amend or otherwise
modify any Assigned Agreement.
SECTION 2.12. Transfers and Other Encumbrances; Additional Shares or
Interests. (a) No Grantor shall (i) sell, assign (by operation of law or
otherwise) or otherwise dispose of, or grant any option with respect to, any of
the Collateral or (ii) create or suffer to exist any Encumbrance upon or with
respect to any of the Collateral of such Grantor, other than the pledge,
assignment and security interest created by this Agreement.
(b) Except as otherwise provided pursuant to Section 5.02(l) of the
24
Indenture, MSA I, SPC-5, Greenfly and Redfly shall not, and the Issuer shall
not permit MSA I, SPC-5, Greenfly and Redfly to, issue, deliver or sell any
shares, interests, participations or other equivalents. Any beneficial
interest or stock or other securities or interests issued in respect of or in
substitution for the Pledged Stock or the Pledged Beneficial Interest shall be
issued to the Security Trustee.
SECTION 2.13. Security Trustee Appointed Attorney-in-Fact. Each Grantor
hereby irrevocably appoints the Security Trustee such Grantor's
attorney-in-fact, with full authority in the place and stead of such Grantor
and in the name of such Grantor or otherwise, from time to time in the Security
Trustee's discretion, to take any action and to execute any instrument that the
Security Trustee may deem necessary or advisable to accomplish the purposes of
this Agreement, including, without limitation:
(a) to ask for, demand, collect, sue for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral;
(b) to receive, indorse and collect any drafts or other instruments
and documents in connection with Section 2.12(a);
(c) to file any claims or take any action or institute any
proceedings that the Security Trustee may deem necessary or desirable for
the collection of any of the Collateral or otherwise to enforce the
rights of the Security Trustee with respect to any of the Collateral; and
(d) to execute and file any financing or continuation statements, or
amendments thereto, and such other instruments or notices, as may be
necessary or desirable, in order to perfect and preserve the pledge,
assignment and security interest granted hereby.
SECTION 2.14. Security Trustee May Perform. If any Grantor fails to
perform any agreement contained herein, the Security Trustee may (but shall not
be obligated to) itself perform, or cause performance of, such agreement, and
the expenses of the Security Trustee incurred in connection therewith shall be
payable by such Grantor.
SECTION 2.15. Covenant to Pay. Each Grantor covenants with the Security
Trustee (for the benefit of the Security Trustee and the Secured Parties) that
it will pay or discharge any monies and liabilities whatsoever that are now, or
at any time hereafter may be, due, owing or payable by such Grantor in any
currency, actually or contingently, solely and/or jointly, and/or severally
with another or others, as principal or surety on any account whatsoever
pursuant to the Service Provider Documents, the Indenture, any Guarantor
Indenture, the MSAF Group Notes, the Secured Guarantee and the Secured Swap
Agreements in accordance with their terms.
SECTION 2.16. As to Permitted Account Investments. (A) The Cash Manager,
acting on behalf of the Security Trustee, shall cause each Permitted Account
Investment made or acquired from or with the proceeds of any Non-Trustee
Account
25
Collateral or Cash Collateral to be delivered to the Security Trustee as
follows (or shall take any and all other actions necessary to create in favor
of the Security Trustee a valid, perfected, first-priority security interest in
each Permitted Account Investment made or acquired in accordance with this
Agreement under laws and regulations (including without limitation Articles 8
and 9 of the UCC and regulations of the U.S. Department of the Treasury
governing transfers of interests in Government Securities) in effect at the
time of such making or acquisition):
(i) in the case of each Certificated Security or Instrument, by (A)
causing the delivery of such Certificated Security or Instrument to the
Security Trustee in the State of New York, registered in the name of the
Security Trustee or duly endorsed by an appropriate person to the
Security Agent or in blank and, in each case, held by the Security
Trustee in the State of New York, or (B) if such Certificated Security or
Instrument is registered in the name of the Securities Intermediary on
the books of the issuer thereof or on the books of any securities
intermediary of the Securities Intermediary, by requesting the Securities
Intermediary to continuously credit by book entry such Certificated
Security or Instrument to the Securities Account and confirming that it
has been credited;
(ii) in the case of each Uncertificated Security, by (A) causing
such Uncertificated Security to be continuously registered on the books
of the issuer thereof in the name of the Security Trustee or (B) if such
Uncertificated Security is registered in the name of the Securities
Intermediary on the books of the issuer thereof or on the books of any
securities intermediary of the Securities Intermediary, by requesting the
Securities Intermediary to continuously credit by book entry such
Uncertificated Security to the Securities Account and confirming that it
has been credited; and
(iii) in the case of each Government Security registered in the name
of the Securities Intermediary on the books of the Federal Reserve Bank
of New York or on the books of any securities intermediary of the
Securities Intermediary, by requesting the Securities Intermediary to
continuously credit by book entry such security to the Securities Account
and confirming that it has been credited.
(b) Each of the Issuer and Security Trustee hereby represents that it has
not entered into, and hereby agrees that it will not enter into, any agreement
(i) with any of the other parties hereto or any Securities Intermediary
specifying any jurisdiction other than the State of New York as the Securities
Intermediary's jurisdiction in connection with the Securities Account with the
Securities Intermediary referred to in Section 2.16(a) for purposes of 31
C.F.R. Section 357.11(b), Section 8-110(e) of the UCC or any similar state or
federal law, or (ii) with any other person relating to such account pursuant to
which it has agreed that the Securities Intermediary may comply with
entitlement orders made by such person. The Security Trustee represents that
it will, by express agreement with the Securities Intermediary, provide for
each item of property held in the Securities Account, other than cash, to be
treated as a "financial asset" within the meaning of Section 8-102(a)(9) of the
UCC.
26
(c) Without limiting the foregoing, the Issuer and the Cash Manager on
behalf of the Security Trustee agree, and the Security Trustee shall cause the
Securities Intermediary, to take such different or additional action as the
Security Trustee may reasonably request in order to maintain the perfection and
priority of the security interest of the Security Trustee in the event of any
change in applicable law or regulation, including without limitation Articles 8
and 9 of the UCC and regulations of the U.S. Department of the Treasury
governing transfers of interests in Government Securities.
SECTION 2.17. As to Irish Law. Notwithstanding anything to the contrary
contained in this Agreement and in addition to and without prejudice to any
other rights or power of the Security Trustee under this Agreement or under
general law in any relevant jurisdiction, at any time that the Collateral shall
become enforceable, the Security Trustee shall be entitled to appoint a
receiver under this Agreement or under the Conveyancing and Law of Property
Act, 1881 (as amended and as the same may be amended, modified or replaced from
time to time, the "1881 Act") and such receiver shall have all such powers,
rights and authority conferred under the 1881 Act, this Agreement and otherwise
under the laws of Ireland without any limitation or restriction imposed by the
1881 Act or otherwise under the laws of Ireland which may be excluded or
removed. Sections 17 and 20 of the 1881 Act shall not apply to the Collateral
or any receiver appointed under this Agreement or under the 1881 Act and
section 24(b) of the Act shall not apply to the Collateral or to any receiver
appointed under this Agreement.
ARTICLE III
REMEDIES
SECTION 3.01. Remedies. Upon delivery of a Default Notice pursuant to
Section 4.02 of the Indenture or any Guarantor Indenture or if any Acceleration
Default under the Indenture or any Guarantor Indenture shall have occurred and
be continuing:
(a) The Security Trustee may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein, all the
rights and remedies of a secured party upon default under the UCC
(whether or not the UCC applies to the affected Collateral) and also may
(i) require any Grantor to, and such Grantor hereby agrees that it shall
at its expense and upon request of the Security Trustee forthwith,
assemble all or part of the Collateral as directed by the Security
Trustee and make it available to the Security Trustee at a place to be
designated by the Security Trustee that is reasonably convenient to both
parties and (ii) without notice except as specified below, sell or cause
the sale of the Collateral or any part thereof in one or more parcels at
public or private sale, at any of the Security Trustee's offices or
elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Security Trustee may deem commercially reasonable.
Each Grantor agrees that, to the extent notice of sale shall be required
by law, at least ten days' notice to such Grantor of the time and place
of any public sale or the time
27
after which any private sale is to be made shall constitute reasonable
notification. The Security Trustee shall not be obligated to make any
sale of Collateral regardless of notice of sale having been given. The
Security Trustee may adjourn any public or private sale from time to time
by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned.
(b) All cash proceeds received by the Security Trustee in respect of
any sale of, collection from, or other realization upon all or any part
of the Collateral may, in the discretion of the Security Trustee, be held
by the Security Trustee as collateral for, and/or then or at any time
thereafter applied in whole or in part by the Security Trustee for the
benefit of the Secured Parties against, all or any part of the Secured
Obligations in accordance with Article VIII of this Agreement and Article
III of the Indenture or any Guarantor Indenture. Any surplus of such
cash or cash proceeds held by the Security Trustee and remaining after
payment in full of all the Secured Obligations shall be paid over to the
relevant Grantors or whomsoever may be lawfully entitled to receive such
surplus. Any amount received for any sale or sales conducted in
accordance with the terms of this Section 3.01 shall be deemed conclusive
and binding on the Issuer, each Grantor and the Secured Parties.
ARTICLE IV
REGISTRATION RIGHTS
SECTION 4.01. Registration Rights. If the Security Trustee shall
determine to exercise its right to sell all or any of the Security Collateral
pursuant to Section 3.01, the Issuer agrees that, upon request of the Security
Trustee, the Issuer will, at its own expense:
(a) execute and deliver, and cause each issuer of the Security
Collateral pledged by it, and the directors and officers thereof to
execute and deliver, all such instruments and documents, and do or cause
to be done all such other acts and things, as may be necessary or, in the
opinion of the Security Trustee, advisable to register such Security
Collateral under the provisions of the Securities Act, to cause the
registration statement relating thereto to become effective and to remain
effective for such period as prospectuses are required by law to be
furnished and to make all amendments and supplements thereto and to the
related prospectus that, in the opinion of the Security Trustee, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and
Exchange Commission applicable thereto;
(b) use its best efforts to qualify the Security Collateral under
the state securities or "Blue Sky" laws and to obtain all necessary
governmental approvals for the sale of the Security Collateral, as
requested by the Security Trustee;
(c) cause each issuer to make available to its security holders, as
soon as
28
practicable, an earnings statement that shall satisfy the provisions of
Section 11(a) of the Securities Act;
(d) provide the Security Trustee with such other information and
projections as may be necessary or, in the opinion of the Security
Trustee, advisable to enable the Security Trustee to effect the sale of
such Security Collateral; and
(e) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Security Collateral or any part
thereof valid and binding and in compliance with applicable law.
The Security Trustee is authorized, in connection with any sale of the Security
Collateral pursuant to Section 3.01, to deliver or otherwise disclose to any
prospective purchaser of the Security Collateral (i) any registration statement
or prospectus, and all supplements and amendments thereto, prepared pursuant to
Section 4.01(a), (ii) any information and projections provided to it pursuant
to Section 4.01(d) and (iii) any other information in its possession relating
to the Security Collateral.
ARTICLE V
SECURITY INTEREST ABSOLUTE
SECTION 5.01. Security Interest Absolute. The obligations of each
Grantor under this Agreement are independent of the Secured Obligations, and a
separate action or actions may be brought and prosecuted against such Grantor
to enforce this Agreement, irrespective of whether any action is brought
against any other Grantor or whether any other Grantor is joined in any such
action or actions. All rights of the Security Trustee and the pledge,
assignment, and security interest hereunder, and all obligations of each
Grantor hereunder, shall be absolute and unconditional, irrespective of:
(a) any lack of validity or enforceability of any Relevant Document,
Service Provider Document, Secured Credit Facility, Secured Guarantee or
Secured Swap Agreement or any other agreement or instrument relating
thereto;
(b) any change in the time, manner or place of payment of, the
security for, or in any other term of, all or any of the Secured
Obligations, or any other amendment or waiver of or any consent to any
departure from any Relevant Document, Service Provider Document, Secured
Credit Facility, Secured Guarantee or Secured Swap Agreement or any other
agreement or instrument relating thereto;
(c) any taking, exchange, release or non-perfection of the
Collateral or any other collateral or taking, release or amendment or
waiver of or consent to departure from any guaranty, for all or any of
the Secured Obligations;
(d) any manner of application of collateral, or proceeds thereof, to
all or any of the Secured Obligations, or any manner of sale or other
disposition of any collateral for all or any of the Secured Obligations
or any other assets of the
29
Grantors;
(e) any change, restructuring or termination of the corporate
structure or existence of any Grantor; or
(f) any other circumstance that might otherwise constitute a defense
available to, or a discharge of, any Grantor or a third-party grantor of
a security interest.
ARTICLE VI
THE SECURITY TRUSTEE
SECTION 6.01. Authorization and Action. (a) The Issuer hereby appoints
and authorizes Bankers Trust as the initial Security Trustee to take such
action as trustee on behalf of the Secured Parties and to exercise such powers
and discretion under this Agreement and the other Relevant Documents as are
specifically delegated to the Security Trustee by the terms hereof and thereof
and no implied duties and covenants shall be deemed to arise hereunder against
the Security Trustee.
(b) The Security Trustee accepts such appointment and agrees to perform
the same but only upon the terms of this Agreement and agrees to receive and
disburse all moneys received by it in accordance with the terms hereof. The
Security Trustee in its individual capacity shall not be answerable or
accountable under any circumstances, except for its own willful misconduct or
gross negligence (or simple negligence in the handling of funds or breach of
any of its representations or warranties set forth herein) and the Security
Trustee shall not be liable for any action or inaction of any Grantor or any
other parties to any of the Relevant Documents.
SECTION 6.02. Absence of Duties. The powers conferred on the Security
Trustee hereunder with respect to the Collateral are solely to protect its
interest herein and shall not impose any duty upon it to exercise any such
powers. Except for the safe custody of any Collateral in its possession and
the accounting for moneys actually received by it hereunder, the Security
Trustee shall have no duty as to any Collateral, as to ascertaining or taking
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relative to any Collateral, whether or not any Secured Party has
or is deemed to have knowledge of such matters, or as to the taking of any
necessary steps to preserve or perfect rights against any parties or any other
rights pertaining to any Collateral. The Security Trustee shall have no duty
to ascertain or inquire as to the performance or observance of any covenants,
conditions or agreements on the part of any Grantor or Lessee.
SECTION 6.03. Representations or Warranties. The Security Trustee does
not make and shall not be deemed to have made any representation or warranty as
to the validity, legality or enforceability of this Agreement, any other
Relevant Document or any other document or instrument or as to the correctness
of any statement contained in any thereof, or as to the validity or sufficiency
of any of the pledge and security interests
30
granted hereby, except that the Security Trustee in its individual capacity
hereby represents and warrants (i) that each such specified document to which
it is a party has been or will be duly executed and delivered by one of its
officers who is and will be duly authorized to execute and deliver such
document on its behalf, and (ii) this Agreement is the legal, valid and binding
obligation of Bankers Trust, enforceable against Bankers Trust in accordance
with its terms, subject to the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors' rights
generally.
SECTION 6.04. Reliance; Agents; Advice of Counsel. (a) The Security
Trustee shall incur no liability to anyone as a result of acting upon any
signature, instrument, notice, resolution, request, consent, order,
certificate, report, opinion, bond or other document or paper believed by it to
be genuine and believed by it to be signed by the proper party or parties. The
Security Trustee may accept a copy of a resolution of the Board of any party to
this Agreement or any Relevant Document, certified by the Secretary or an
Assistant Secretary thereof or other duly authorized Person of such party as
duly adopted and in full force and effect, as conclusive evidence that such
resolution has been duly adopted by said Board and that the same is in full
force and effect. As to any fact or matter the manner of ascertainment of
which is not specifically described herein, the Security Trustee shall be
entitled to receive and may for all purposes hereof conclusively rely on a
certificate, signed by an officer of any duly authorized Person, as to such
fact or matter, and such certificate shall constitute full protection to the
Security Trustee for any action taken or omitted to be taken by it in good
faith in reliance thereon. The Security Trustee shall furnish to each Service
Provider upon request such information and copies of such documents as the
Security Trustee may have and as are necessary for such Service Provider to
perform its duties under the applicable Relevant Documents. The Security
Trustee shall assume, and shall be fully protected in assuming, that each other
party hereto is authorized by its constitutional documents to enter into this
Agreement and to take all action permitted to be taken by it pursuant to the
provisions hereof, and shall not inquire into the authorization of such party
with respect thereto.
(b) The Security Trustee may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents, including
without limitation, financial advisors, or attorneys or a custodian or nominee,
and the Security Trustee shall not be responsible for any misconduct or
negligence on the part of, or for the supervision of, any such agent, attorney,
custodian or nominee appointed with due care by it hereunder.
(c) The Security Trustee may consult with counsel and any opinion of
counsel or any advice of such counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion of
counsel.
(d) The Security Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation hereunder or in relation hereto, at the request, order
or direction of any of the Secured Parties, pursuant to the provisions of this
Agreement, unless such Secured Party shall have offered to the Security Trustee
reasonable security or indemnity satisfactory to it
31
against the costs, expenses and liabilities which may be incurred therein or
thereby.
(e) The Security Trustee shall not be required to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if
there is reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it, and none of the provisions contained in this Agreement shall in any event
require the Security Trustee to perform, or be responsible or liable for the
manner of performance of, any obligations of the Issuer or the Administrative
Agent under any of the Relevant Documents.
(f) The Security Trustee shall not be liable for any Losses, Taxes or the
selection of Permitted Account Investments or for any investment losses
resulting from Permitted Account Investments.
(g) When the Security Trustee incurs expenses or renders services in
connection with an exercise of remedies specified in Section 3.01 or during a
proceeding described in Section 8.03(a), such expenses (including the fees and
expenses of its counsel) and the compensation for such services are intended to
constitute expenses of administration under any bankruptcy law or law relating
to creditors' rights generally.
(h) The Security Trustee shall not be charged with knowledge of an Event
of Default unless a Responsible Officer of the Security Trustee obtains actual
knowledge of such event or the Security Trustee receives written notice of such
event from any of the Secured Parties or the Administrative Agent.
(i) The Security Trustee shall have no duty to monitor the performance of
the Issuer, the Administrative Agent or any other party to the Relevant
Documents, nor shall it have any liability in connection with the malfeasance
or nonfeasance by such parties. The Security Trustee shall have no liability
in connection with compliance by the Issuer, any Guarantor, the Administrative
Agent or any lessee under a Lease with statutory or regulatory requirements
related to the Collateral, any Aircraft or any Lease. The Security Trustee
shall not make or be deemed to have made any representations or warranties with
respect to the Collateral, any Aircraft or any Lease or the validity or
sufficiency of any assignment or other disposition of the Collateral, any
Aircraft or any Lease.
SECTION 6.05. Not Acting in Individual Capacity. The Security Trustee
acts hereunder solely as trustee unless otherwise expressly provided; and all
Persons having any claim against the Security Trustee by reason of the
transactions contemplated hereby shall look, subject to the lien and priorities
of payment provided herein and in the Indenture, only to the property of the
Grantors for payment or satisfaction thereof.
ARTICLE VII
SUCCESSOR TRUSTEES
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SECTION 7.01. Resignation and Removal of Security Trustee. The Security
Trustee may resign at any time without cause by giving at least 30 days' prior
written notice to the Issuer, any Guarantor and the Senior Representative. The
Senior Representative may at any time remove the Security Trustee without cause
by an instrument in writing delivered to the Secured Parties and the Security
Trustee. No termination of this Agreement by the Security Trustee or the
Senior Representative pursuant to this Section 7.01 shall become effective
prior to the date of appointment by the Senior Representative of a successor
Security Trustee and the acceptance of such appointment by such successor
Security Trustee.
SECTION 7.02. Appointment of Successor. (a) In the case of the
resignation or removal of the Security Trustee, the Senior Representative, on
behalf of the Secured Parties, shall promptly appoint a successor Security
Trustee. If a successor Security Trustee shall not have been appointed and
accepted its appointment hereunder within 60 days after the Security Trustee
gives notice of resignation as to such class or subclass, the retiring Security
Trustee or the Secured Parties may petition any court of competent jurisdiction
for the appointment of a successor Security Trustee. Any successor Security
Trustee so appointed by such court shall immediately and without further act be
superseded by any successor Security Trustee appointed as provided in the first
sentence of this paragraph within one year from the date of the appointment by
such court.
(b) Any successor Security Trustee shall execute and deliver to the
Secured Parties an instrument accepting such appointment. Upon the acceptance
of any appointment as Security Trustee hereunder a successor Security Trustee
and upon the execution and filing or recording of such financing statements, or
amendments thereto, and such amendments or supplements to this Agreement, and
such other instruments or notices, as may be necessary or desirable, or as the
Senior Trustee may request, in order to continue the perfection of the liens
granted or purported to be granted hereby, such Security Trustee shall succeed
to and become vested with all the rights, powers, discretion, privileges and
duties of the retiring Security Trustee, and the retiring Security Trustee
shall be discharged from its duties and obligations under this Agreement and
the other Relevant Documents. After any retiring Security Trustee's
resignation or removal hereunder as to any actions taken or omitted to be taken
by it while it was Security Trustee, the provisions of all of Article VIII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Security Trustee under this Agreement.
(c) Each Security Trustee shall be an Eligible Institution, if there be
such an institution willing, able and legally qualified to perform the duties
of a Security Trustee hereunder.
(d) Any corporation into which the Security Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Security Trustee
shall be a party, or any corporation to which substantially all the business of
the Security Trustee may be transferred, shall be the Security Trustee under
this Agreement without further act.
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ARTICLE VIII
AGREEMENT AMONG SECURED PARTIES
SECTION 8.01. Subordination and Priority. (a) Notwithstanding the date,
manner or order of attachment or perfection or the description of any
collateral or security interests, liens, claims or encumbrances covered or
granted by Section 2.01, each Subordinated Representative agrees that the
respective rights and interest of the Subordinated Creditors in the Collateral
are and shall be subordinate, to the extent and in the manner hereinafter set
forth, to all rights and interest of the Senior Creditors in the Collateral,
and that the Senior Creditors shall have at all times interests prior and
senior to that of the Subordinated Creditors in all Collateral until the
payment in full of all Senior Obligations owed to such Senior Creditors.
(b) For the purposes of this Agreement, no Senior Obligations shall be
deemed to have been paid in full until and unless the Senior Representative in
respect of such Senior Obligations shall have received payment in full in cash
of such Senior Obligations.
(c) Notwithstanding anything contained herein to the contrary, payments
from any property (or the proceeds thereof) deposited in the
Defeasance/Redemption Account pursuant to Article XI of the Indenture and any
Guarantor Indenture shall not be subordinated to the prior payment of any
Senior Creditors in respect of any Senior Obligations or subject to any other
restrictions set forth in this Article VIII, and none of the Holders shall be
obligated to pay over any payments from any such property to the Security
Trustee or any other creditor of any of the Grantors.
SECTION 8.02. Exercise of Remedies. (a) Until the date on which all the
Senior Obligations shall have been paid in full, the Senior Representative, in
its sole discretion and to the exclusion of the Subordinated Representatives,
shall have, whether or not any default under the Indenture or any Guarantor
Indenture shall have occurred and be continuing and both before and after the
commencement of any proceeding referred to in Section 8.03(a), the sole and
exclusive right (as between the Senior Representative, on the one hand, and the
Subordinated Representatives, on the other) to direct the Security Trustee to
take all action with respect to the Collateral, including, without limitation,
the right to exercise or direct voting or other consensual rights, to foreclose
or forebear from foreclosure in respect of the Collateral and to accept the
Collateral in full or partial satisfaction of any Senior Obligation, all in
accordance with the terms of this Agreement. The Subordinated Representatives
agree that, until the Senior Obligations have been paid in full, the only right
of the Subordinated Creditors under this Agreement is for the Subordinated
Obligations to be secured by the Collateral for the period and to the extent
provided for herein and to receive a share of the proceeds of the Collateral,
if any.
(b) The Subordinated Representatives agree that, so long as any of the
Senior Obligations shall remain unpaid, they and the Subordinated Creditors
will not commence, or join with any creditor other than the Security Trustee
and the Senior
34
Creditors in commencing, any enforcement, collection, execution, levy or
foreclosure proceeding with respect to the Collateral or proceeds of
Collateral. Upon request by the Senior Representative, the Subordinated
Representatives and the Subordinated Creditors will, at the expense of the
Issuer, join in enforcement, collection, execution, levy or foreclosure
proceedings and otherwise cooperate fully in the maintenance of such
proceedings by the Security Trustee, including without limitation by executing
and delivering all such consents, pleadings, releases and other documents and
instruments as the Security Trustee may reasonably request in connection
therewith, it being understood that the conduct of such proceedings shall at
all times be under the exclusive control of the Security Trustee.
(c) The Subordinated Representatives agree, upon written request by the
Senior Representative, to release the liens and security interests in favor of
the Subordinated Creditors in any Collateral and to execute and deliver all
such directions, consents, pleadings, releases and other documents and
instruments as the Senior Representative may reasonably request in connection
therewith, upon any sale, lease, transfer or other disposition of such
Collateral or part thereof in accordance with, or for application of proceeds
pursuant to, Section 8.01(a).
(d) The Subordinated Representatives agree that neither they nor any
Subordinated Creditors will contest, or bring (or join in) any action or
proceeding for the purpose of contesting, the validity, perfection or priority
of, or seeking to avoid, the rights of the Senior Representative or the Senior
Creditors in or with respect to the Collateral.
SECTION 8.03. Further Agreements of Subordination. The Subordinated
Representatives agree as follows:
(a) Upon any distribution of all or any of the Collateral or
proceeds of Collateral to creditors of any Grantor upon the dissolution,
winding-up, liquidation, arrangement, reorganization, adjustment,
protection, relief, or composition of such Grantor or its debts, whether
in any bankruptcy, insolvency, arrangement, reorganization, receivership,
relief or similar proceedings or upon an assignment for the benefit of
creditors or any other marshalling of the assets and liabilities of such
Grantor, or otherwise, any distribution of any kind of Collateral or
proceeds of Collateral that otherwise would be deliverable upon or with
respect to the Subordinated Obligations shall be delivered directly to
the Security Trustee for application (in the case of cash) to or as
collateral (in the case of non-cash property or securities) for the
payment or prepayment of the Senior Obligations until the Senior
Obligations shall have been paid in full.
(b) If any proceeding referred to in Section 8.03(a) is commenced by
or against any Grantor,
(i) the Security Trustee is hereby irrevocably authorized and
empowered (in its own name or in the name of the Secured Parties or
otherwise), but shall have no obligation, to demand, sue for,
collect and receive every distribution referred to in subsection
(a) above and give
35
acquittance therefor and to file claims and proofs of claim and
take such other action (including without limitation enforcing this
Agreement) as it may deem necessary or advisable, or as the Senior
Representative may direct, for the exercise or enforcement of any
of the rights or interests of the Senior Creditors hereunder; and
(ii) the Subordinated Representatives shall duly and promptly
take such action, at the expense of the Issuer, as the Senior
Representative may request (A) to collect Collateral and proceeds
of Collateral for the account of the Senior Creditors and to file
appropriate claims or proofs of claim in respect of Collateral and
proceeds of Collateral, (B) to execute and deliver to the Security
Trustee such powers of attorney, assignments, or other instruments
as the Senior Representative may request in order to enable it to
enforce any and all claims with respect to the Collateral and
proceeds of Collateral and (C) to collect and receive any and all
payments or distributions that may be payable or deliverable upon
or with respect to the Collateral or proceeds of Collateral.
(c) All payments or distributions upon or with respect to the
Collateral or proceeds of Collateral that are received by the
Subordinated Representatives or the Subordinated Creditors contrary to
the provisions of this Agreement shall be received for the benefit of the
Senior Creditors, shall be segregated from other funds and property held
by the Subordinated Representatives or the Subordinated Creditors and
shall be forthwith paid over to the Security Trustee in the same form as
so received (with any necessary indorsement) to be applied (in the case
of cash) to or held as collateral (in the case of non-cash property or
securities) for the payment or prepayment of the Senior Obligations in
accordance with the terms thereof.
(d) The Senior Representative is hereby authorized to demand
specific performance of this Agreement at any time when any of the
Subordinated Representatives or the Subordinated Creditors shall have
failed to comply with any of the provisions of this Agreement applicable
to them. The Subordinated Representatives hereby irrevocably waive, on
their own behalf and on behalf of the Subordinated Creditors, any defense
based on the adequacy of a remedy at law that might be asserted as a bar
to such remedy of specific performance.
SECTION 8.04. Possession of Collateral. The Security Trustee agrees to
hold any Collateral received by it, in or against which a security interest or
lien may be perfected by possession, as bailee on behalf of the Secured
Parties.
SECTION 8.05. Rights of Subrogation. The Subordinated Representatives
agree that no payment or distributions to the Senior Representative or the
Senior Creditors pursuant to the provisions of this Agreement shall entitle any
Subordinated Representative or any Subordinated Creditor to exercise any rights
of subrogation in respect thereof until all Obligations constituting Senior
Obligations with respect to such Person shall have been paid in full.
36
SECTION 8.06. Further Assurances of Subordinated Representatives. Each
of the Subordinated Representatives shall, at the expense of the Issuer, at any
time and from time to time promptly execute and deliver all further instruments
and documents, and take all further action, that the Senior Representative or
the Security Trustee may reasonably request, in order to protect any right or
interest granted or purported to be granted hereby or to enable the Senior
Representative and the Security Trustee to exercise and enforce their rights
and remedies hereunder.
SECTION 8.07. No Change in Rights in Collateral. The Subordinated
Representatives and the Subordinated Creditors will not sell, assign, pledge,
encumber or otherwise dispose of any of their rights in the Collateral as such
or in proceeds of Collateral as such, without the prior written consent of the
Senior Representative. Nothing in this Section 8.07 shall limit the right of
any Subordinated Creditor to transfer any Subordinated Obligation including,
without limitation, any Note.
SECTION 8.08. Waiver of Marshalling and Similar Rights. Each of the
Subordinated Representatives waives, on its own behalf and on behalf of the
Subordinated Creditors, to the fullest extent permitted by applicable law, any
requirement regarding, and agrees not to demand, request, plead or otherwise
claim the benefit of, any marshalling, appraisement, valuation or other similar
right with respect to the Collateral that may otherwise be available under
applicable law or any other similar rights a junior creditor or junior secured
creditor may have under applicable law.
SECTION 8.09. Enforcement. Each of the Subordinated Representatives
agrees that this Agreement shall be enforceable against it and the Subordinated
Creditors under all circumstances, including without limitation in any
proceeding referred to in Section 8.03(a).
SECTION 8.10. Obligations Hereunder Not Affected. All rights and
interests of the Senior Representative, the Senior Creditors and the Security
Trustee hereunder, and all agreements and obligations of the Subordinated
Representatives under this Agreement, shall remain in full force and effect
irrespective of:
(i) any lack of validity or enforceability of this Agreement, any
Service Provider Document, MSAF Group Note, Secured Credit Facility,
Secured Guarantee or Secured Swap Agreement or any other agreement or
instrument relating thereto;
(ii) any change in the time, manner or place of payment of, the
security for, or in any other term of, all or any of the Senior
Obligations, or any other amendment or waiver of or any consent to any
departure from this Agreement, any Service Provider Document, MSAF Group
Note, Secured Credit Facility, Secured Guarantee or Secured Swap
Agreement or any other agreement or instrument relating thereto;
(iii) any taking, exchange, release or non-perfection of the
Collateral or any other collateral, or any release or amendment or waiver
of or consent to
37
departure from any guaranty, for all or any of the Senior Obligations; or
(iv) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Subordinated
Representatives, the Subordinated Creditors, a subordinated creditor or a
secured subordinated creditor.
This Agreement shall continue to be effective or shall be revived or
reinstated, as the case may be, if at any time any payment of any of the Senior
Obligations is rescinded or must otherwise be returned by any Senior Creditor
upon the insolvency, bankruptcy or reorganization of any Grantor, or otherwise,
all as though such payment had not been made.
SECTION 8.11. Waiver. The Subordinated Representatives hereby waive, on
their own behalf and on behalf of the Subordinated Creditors, to the fullest
extent permitted by law, any right under Section 9-504(1)(c) of the N.Y.
Uniform Commercial Code to application of the proceeds of disposition (other
than as contemplated by this Agreement), any right to notice and objection
under Section 9-505(2) of the N.Y. Uniform Commercial Code and promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Senior Obligations and this Agreement and any requirement that the Security
Trustee protect, secure, perfect or insure any security interest or lien
hereunder or otherwise or any Collateral or any other property subject thereto
or exhaust any right or take any action against the Grantors or any other
person or entity or any Collateral or any other collateral.
SECTION 8.12. Senior Obligations and Subordinated Obligations Unimpaired.
Nothing in this Agreement shall impair (i) as between the Issuer and any party
hereto, the obligations of the Issuer to such party, including without
limitation the Senior Obligations and the Subordinated Obligations, or (ii) as
between the Senior Creditors and the Subordinated Creditors, the provisions
relating to the priority of payments in the Indenture; provided that it is
understood that the enforcement of rights and remedies against the Collateral
shall be subject to the terms of this Agreement.
SECTION 8.13. Upon Discharge of Obligations. Upon the payment in full of
the Senior Obligations in respect of which it is acting as Senior
Representative, the Security Trustee shall, without any further action on its
part, be relieved of any obligation under this Agreement with respect to such
discharged Senior Obligations and this Agreement shall continue in effect as an
agreement among the remaining Secured Parties.
ARTICLE IX
INDEMNITY AND EXPENSES
SECTION 9.01. Indemnity. (a) The Issuer shall indemnify the Security
Trustee (and its officers, directors, employees and agents) for, and hold it
harmless against, any loss, liability or expense (including reasonable legal
fees and expenses) incurred by it without negligence or bad faith on its part
in connection with the acceptance or administration of this Agreement and its
duties hereunder, including the costs and expenses
38
of defending itself against any claim or liability and of complying with any
process served upon it or any of its officers in connection with the exercise
or performance of any of its powers or duties and hold it harmless against, any
loss, liability or reasonable expense incurred without negligence or bad faith
on its part. The Security Trustee shall notify the Issuer promptly of any
claim asserted against the Security Trustee for which it may seek indemnity;
provided, however, that failure to provide such notice shall not invalidate any
right to indemnity hereunder. The Issuer shall defend the claim and the
Security Trustee shall cooperate in the defense. The Security Trustee may have
separate counsel and the Issuer shall pay reasonable fees and expenses of such
counsel. The Issuer need not pay for any settlements made without its consent;
provided that such consent shall not be unreasonably withheld. The Issuer need
not reimburse any expense or indemnity against any loss or liability incurred
by the Security Trustee through negligence or bad faith.
(b) The Issuer shall upon demand pay to the Security Trustee the amount of
any and all reasonable expenses, including the reasonable fees and expenses of
its counsel and of any experts and agents, that the Security Trustee may incur
in connection with (i) the administration of this Agreement, (ii) the custody,
preservation, use or operation of, or the sale of, collection from or other
realization upon, any of the Collateral, (iii) the exercise or enforcement of
any of the rights of the Security Trustee or any other Secured Party against
any Grantor hereunder or (iv) the failure by any Grantor to perform or observe
any of the provisions hereof.
SECTION 9.02. Noteholders' Indemnity. The Security Trustee shall be
entitled, subject to such Security Trustee's duty during a default to act with
the required standard of care, to be indemnified by the Senior Creditors to the
sole satisfaction of the Security Trustee before proceeding to exercise any
right or power under this Agreement at the request or direction of the Senior
Representative.
The provisions of Section 9.01 and Section 9.02 shall survive the
termination of this Agreement or the earlier resignation or removal of the
Security Trustee.
SECTION 9.03. No Compensation from Secured Parties. The Security Trustee
agrees that it shall have no right against the Secured Parties for any fee as
compensation for its services hereunder.
SECTION 9.04. Security Trustee Fees. In consideration of the Security
Trustee's performance of the services provided for under this Agreement, the
Issuer shall pay to the Security Trustee an annual fee set forth under a
separate agreement between the Issuer and the Security Trustee.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Amendments; Waivers; Etc. (a) No amendment or waiver of
any provision of this Agreement, and no consent to any departure by any party
herefrom, shall in any event be effective unless the same shall be in writing
and signed by
39
each Service Provider, the Senior Trustee and, in the event it is adversely
affected thereby, the Subordinated Representative, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No failure on the part of the Security Trustee to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. In executing and delivering any amendment or modification to this
Agreement, the Security Trustee shall be entitled to (i) an Opinion of Counsel
stating that such amendment is authorized and permitted pursuant to the
Indenture and this Agreement and complies therewith and herewith and (ii) an
Officer's Certificate stating that all conditions precedent to the execution,
delivery and performance of such amendment have been satisfied in full. The
Security Trustee may, but shall have no obligation to, execute and deliver any
amendment or modification which would affect its duties, powers, rights,
immunities or indemnities hereunder.
(b) Upon the execution and delivery by any Person of a security agreement
supplement in substantially the form of Exhibit C hereto, (i) such Person shall
be referred to as an "Additional Grantor" and shall be and become a Grantor
hereunder, and each reference in this Agreement to "Grantor" shall also mean
and be a reference to such Additional Grantor, (ii) the annexes attached to
each Security Trust Agreement Supplement shall be incorporated into and become
a part of and supplement Schedule III and Schedule IV, and the Security Trustee
may attach such annexes as supplements to such Schedules; and each reference to
such Schedules shall mean and be a reference to such Schedules as supplemented
pursuant hereto and (iii) such Additional Grantor shall be a Grantor for all
purposes under this Agreement and shall be bound by the obligations of the
Grantors hereunder.
SECTION 10.02. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including
telecopier, telegraphic, telex or cable communication) and mailed, telegraphed,
telecopied, telexed, cabled or delivered to the Issuer, the Administrative
Agent, the Cash Manager, the Servicer, the Trustee, the Initial Credit Facility
Providers or the Security Trustee, as the case may be, in each case addressed
to it at its address specified in Section 13.05 of the Indenture or, in the
case of the Initial Credit Facility Providers, as follows:
if to ILFC, to:
International Lease Finance Corporation
1999 Avenue of the Stars
39th Floor
Los Angeles, CA 90067
Attention: Legal Department
Facsimile: (+1 310) 788-1990
if to Morgan Stanley, Dean Witter, Discover & Co., to:
Morgan Stanley, Dean Witter, Discover & Co.
40
25 Cabot Square
Canary Wharf
London E14 4QA
Attention: Mr. Scott Peterson
Facsimile: (+44 171) 415-4328
or, as to each party, at such other address as shall be designated by such
party in a written notice to each other party complying as to delivery with the
terms of this Section 10.02. All such notices and other communications shall,
when mailed, telecopied, telegraphed, telexed or cabled, respectively, be
effective when deposited in the mails, telecopied, delivered to the telegraph
company, confirmed by telex answerback or delivered to the cable company,
respectively, addressed as aforesaid.
SECTION 10.03. No Waiver; Remedies. No failure on the part of the
Security Trustee to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and
not exclusive of any remedies provided by law.
SECTION 10.04. Severability. If any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof shall not in any way be affected or impaired.
SECTION 10.05. Continuing Security Interest; Assignments. Subject to the
Section 10.06(c), this Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until the earlier
of the payment in full in cash of the Secured Obligations and the circumstances
specified in Section 10.06(c), (b) be binding upon each Grantor, its successors
and assigns and (c) inure, together with the rights and remedies of the
Security Trustee hereunder, to the benefit of the Secured Parties and their
respective successors, transferees and assigns. Without limiting the
generality of the foregoing subsection (c), any Secured Party may assign or
otherwise transfer all or any portion of its rights and obligations under any
Relevant Document to which it is a party in accordance with the terms thereof
to any other Person or entity, and such other Person or entity shall thereupon
become vested with all the rights in respect thereof granted to such Secured
Party herein or otherwise.
SECTION 10.06. Release and Termination. (a) Upon any sale, lease,
transfer or other disposition of any item of Collateral in accordance with the
terms of the Indenture, the Security Trustee will, at the Issuer's expense,
execute and deliver to the Grantor of such item of Collateral such documents as
such Grantor shall reasonably request and provide to the Security Trustee to
evidence the release of such item of Collateral from the assignment and
security interest granted hereby.
(b) Except as otherwise provided in Section 10.06(c), upon the payment in
full in cash of the Secured Obligations, the pledge, assignment and security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the Grantors. Upon any such termination, the Security Trustee will,
at the Issuer's expense, execute and
41
deliver to each relevant Grantor such documents as such Grantor shall prepare
and reasonably request to evidence such termination.
(c) If at any time all Notes have been defeased pursuant to Article XI of
the Indenture, the pledge, assignment and security interest in the Pledged
Stock shall be released and the certificates representing the Pledged Stock
shall be returned to the Issuer and the Security Trustee shall, at the expense
of the Issuer, execute and deliver to the Issuer such documents as the Issuer
shall prepare and reasonably request to evidence such termination.
SECTION 10.07. Currency Conversion. If any amount is received or
recovered by the Security Trustee in respect of this Agreement or any part
thereof in a currency (the "Received Currency") other than the currency in
which such amount was expressed to be payable (the "Agreed Currency"), then the
amount in the Received Currency actually received or recovered by the Security
Trustee, to the extent permitted by law, shall only constitute a discharge of
the relevant Grantor to the extent of the amount of the Agreed Currency which
the Security Trustee was or would have been able in accordance with its or his
normal procedures to purchase on the date of actual receipt or recovery (or, if
that is not practicable, on the next date on which it is so practicable), and,
if the amount of the Agreed Currency which the Security Trustee is or would
have been so able to purchase is less than the amount of the Agreed Currency
which was originally payable by the relevant Grantor, such Grantor shall pay to
the Security Trustee such amount as it shall determine to be necessary to
indemnify the Security Trustee against any Loss sustained by it as a result
(including the cost of making any such purchase and any premiums, commissions
or other charges paid or incurred in connection therewith) and so that, to the
extent permitted by law, (i) such indemnity shall constitute a separate and
independent obligation of each Grantor distinct from its obligation to
discharge the amount which was originally payable by such Grantor and (ii)
shall give rise to a separate and independent cause of action and apply
irrespective of any indulgence granted by the Security Trustee and continue in
full force and effect notwithstanding any judgment, order, claim or proof for a
liquidated amount in respect of the amount originally payable by any Grantor or
any judgment or order and no proof or evidence of any actual loss shall be
required.
SECTION 10.08. Governing Law. THIS AGREEMENT SHALL IN ALL RESPECTS BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY
INTERESTS HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. UNLESS OTHERWISE DEFINED HEREIN OR IN THE INDENTURES, TERMS USED IN
ARTICLE 9 OF THE UCC ARE USED HEREIN AS THEREIN DEFINED.
SECTION 10.09. Jurisdiction. (a) Each of the parties hereto irrevocably
agrees that the courts of New York shall have jurisdiction to hear and
determine any suit, action or proceeding, and to settle any disputes, which may
arise out of or in connection
42
with this Agreement and, for such purposes, irrevocably submits to the
jurisdiction of such courts. Each of the parties hereto irrevocably waives any
objection which it might now or hereafter have to the federal U.S. or New York
State courts located in New York, New York being nominated as the forum to hear
and determine any suit, action or proceeding, and to settle any disputes, which
may arise out of or in connection with this Agreement and agrees not to claim
that any such court is not a convenient or appropriate forum. Each of the
parties hereto agrees that the process by which any suit, action or proceeding
is begun may be served on it by being delivered in connection with any suit,
action or proceeding in New York, New York to the Person named as the process
agent of such party in Exhibit F to the Indenture at the address set out
therein or at the principal New York City office of such process agent, if not
the same.
(b) Each of the parties hereto hereby consents generally in respect of any
legal action or proceeding arising out of or in connection with this Agreement
to the giving of any relief or the issue of any process in connection with such
action or proceeding, including the making, enforcement or execution against
any property whatsoever (irrespective of its use or intended use) of any order
or judgment which may be made or given in such action or proceeding.
SECTION 10.10. Counterparts. This Agreement may be executed in two or
more counterparts by the parties hereto, and each such counterpart shall be
considered an original and all such counterparts shall constitute one and the
same instrument.
SECTION 10.11. Table of Contents, Headings, Etc. The Table of Contents
and headings of the Articles and Sections of this Agreement have been inserted
for convenience of reference only, are not to be considered a part hereof and
shall in no way modify or restrict any of the terms and provisions hereof.
43
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by its representative or officer thereunto duly
authorized as of the date first above written.
MORGAN STANLEY AIRCRAFT FINANCE
By /s/ C. Scott Peterson
Name: C. Scott Peterson
Title: Alternative Signatory Trustee
MSA I
By /s/ Alexander Frank
Name: Alexander Frank
Title: Signatory Trustee
AIRCRAFT SPC-5, INC.
By /s/ Maurice Mason
Name: Maurice Mason
Title: Chairman
REDFLY (UK) LIMITED
By /s/ Maurice Mason
Name: Maurice Mason
Title: Chairman
SIGNED AND SEALED AND DELIVERED
for and on behalf of
GREENFLY (IRELAND) LIMITED
By /s/ Maurice Mason
its duly authorized attorney in fact in
the presence of:-
44
SIGNED AND SEALED AND DELIVERED
for and on behalf of
CABOT AIRCRAFT SERVICES LIMITED, as
Administrative Agent
By /s/ Kieran O'Keefe
Name: Kieran O'Keefe
Title:
BANKERS TRUST COMPANY, not in its
individual capacity but solely as Cash
Manager
By /s/ Patricia M.F. Russo
Name: Patricia M.F. Russo
Title: Vice President
INTERNATIONAL LEASE FINANCE
CORPORATION, as Servicer
By /s/ Grant Levy
Name: Grant Levy
Title: Vice President
BANKERS TRUST COMPANY, not in its
individual capacity, but solely as
Trustee
By /s/ Patricia M.F. Russo
Name: Patricia M.F. Russo
Title: Vice President
BANKERS TRUST COMPANY, not in its
individual capacity, but solely as
Reference Agent
45
By /s/ Patricia M.F. Russo
Name: Patricia M.F. Russo
Title: Vice President
BANKERS TRUST COMPANY, not in its
individual capacity, but solely as
Security Trustee
By /s/ Patricia M.F. Russo
Name: Patricia M.F. Russo
Title: Vice President
INTERNATIONAL LEASE FINANCE
CORPORATION, as Initial Credit Facility
Provider
By /s/ Grant Levy
Name: Grant Levy
Title: Vice President
MORGAN STANLEY, DEAN WITTER,
DISCOVER & CO., as Initial Credit
Facility Provider
By /s/ Alexander Frank
Name: Alexander Frank
Title: Assistant Treasurer
46
SCHEDULE I
SECURITY TRUST AGREEMENT
PLEDGED STOCK
Percentage of
Stock Issuer Par Value Certificate No(s). Number of Shares Outstanding Shares
- -------------------- ---------- ------------------ ---------------- ------------------
Aircraft SPC-5, Inc. None 2 1,000 100%
Redfly (UK) Limited pound
sterling 1 3 2 100%
Greenfly (Ireland)
Limited IR pound 1 None 2 100%
PLEDGED BENEFICIAL INTERESTS
Percentage of
Beneficial
Issuer Certificate No. Interests
- ------ --------------- ---------------
MSA I 1 100%
PLEDGED DEBT
Debt Issuer Description of Debt Date
- ----------- ------------------------ -----------------
MSA I Revolving Loan Agreement November 10, 1997
47
SCHEDULE II
SECURITY TRUST AGREEMENT
NON-TRUSTEE ACCOUNT INFORMATION
NAME AND ADDRESS OF
NAME AND ADDRESS OF BANK NON-TRUSTEE ACCOUNT HOLDER ACCOUNT NUMBER
- ------------------------ -------------------------- --------------
None
48
SCHEDULE III
SECURITY TRUST AGREEMENT
TRADE NAMES
None.
49
SCHEDULE IV
SECURITY TRUST AGREEMENT
CHIEF PLACE OF BUSINESS
AND
CHIEF EXECUTIVE OR REGISTERED OFFICE
CHIEF EXECUTIVE OR
NAME OF GRANTOR PLACE OF BUSINESS REGISTERED OFFICE
- ----------------------- ---------------------------- ----------------------------
Morgan Stanley Aircraft c/o Wilmington Trust Company c/o Wilmington Trust Company
Finance 100 North Market Street 100 North Market Street
Rodney Square North Rodney Square North
Wilmington, Delaware 19890 Wilmington, Delaware 19890
USA USA
MSA I c/o Wilmington Trust Company c/o Wilmington Trust Company
100 North Market Street 100 North Market Street
Rodney Square North Rodney Square North
Wilmington, Delaware 19890 Wilmington, Delaware 19890
USA USA
Greenfly (Ireland) Limited 2 Harbourmaster Place 2 Harbourmaster Place
Custom House Dock Custom House Dock
Dublin 1 Dublin 1
Ireland Ireland
Redfly (UK) Limited 21 St. Thomas Street 21 St. Thomas Street
Bristol BS1 6JS Bristol BS1 6JS
England, UK England, UK
Aircraft SPC-5, Inc. c/o International Lease Finance c/o International Lease Finance
Corporation Corporation
1999 Avenue of the Stars 1999 Avenue of the Stars
39th Floor 39th Floor
Los Angeles, California 90067 Los Angeles, California 90067
USA USA
50
EXHIBIT A
SECURITY TRUST AGREEMENT
FORM OF CREDIT FACILITY PROVIDER SUPPLEMENT
Bankers Trust Company, as Security Trustee
Four Albany Street
New York, New York 10006 [Date]
Attention: [ ]
Re: Security Trust Agreement, dated as of March 3, 1998
Reference is made to the Security Trust Agreement, dated as of March 3,
1998 (the "Security Trust Agreement"), among MORGAN STANLEY AIRCRAFT FINANCE, a
Delaware business trust created under the Third Amended and Restated Trust
Agreement, dated as of March 3, 1998, among MS Financing Inc., as depositor,
Wilmington Trust Company, as the Delaware Trustee, the Independent Trustees,
the Alternate Controlling Trustee and the Controlling Trustees party thereto,
the ISSUER SUBSIDIARIES party thereto, CABOT AIRCRAFT SERVICES LIMITED, a
company incorporated under the laws of Ireland, as the Administrative Agent,
BANKERS TRUST COMPANY, a New York banking corporation, as the Cash Manager,
INTERNATIONAL LEASE FINANCE CORPORATION, a corporation incorporated under the
laws of the State of California, as the Servicer, INTERNATIONAL LEASE FINANCE
CORPORATION, as credit facility provider under the Custody and Loan Agreement,
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO., as credit facility provider under
the Loan Agreement, BANKERS TRUST COMPANY, not in its individual capacity
(except as otherwise provided in the Indenture), but solely in its capacity as
trustee under the Indenture, BANKERS TRUST COMPANY, not in its individual
capacity, but solely as the initial Reference Agent, and BANKERS TRUST COMPANY,
not in its individual capacity (except as otherwise provided pursuant to
Sections 6.03(i) and 6.03(ii) of the Security Trust Agreement), but solely as
the initial Security Trustee (the "Security Trustee"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
them in the Security Trust Agreement.
The undersigned hereby:
1. confirms that attached hereto is a true and complete copy of the
_________ Agreement, between the Issuer and the undersigned, dated as of
____ (the "Credit Facility Agreement"), which Credit Facility Agreement
constitutes a [Primary] [Secondary] [Eligible] Credit Facility under the
Indenture;
51
2. confirms that it has received a copy of the Security Trust
Agreement and such other documents and information as it deems
appropriate to make a decision to enter into this Credit Facility
Provider Supplement;
3. confirms that upon entering into this Credit Facility Provider
Supplement, the undersigned shall become a party to the Security Trust
Agreement, subject to the terms and provisions thereof, including
Sections 8.01(c) and 8.03(c) thereof, and each reference in the Security
Trust Agreement to a "Secured Party" shall also mean and be a reference
to the undersigned;
4. appoints and authorizes the Senior Trustee to take any and all
actions in respect of the Collateral as are delegated to the Senior
Trustee by the terms of the Relevant Documents, together with any such
powers and discretion as are reasonably incidental thereto;
5. confirms its agreement to the limitations and qualifications of
the Security Trustee's obligations set forth in Article VI of the
Security Trust Agreement;
6. confirms that this Credit Facility Provider Supplement shall be
governed by, and construed in accordance with, the laws of the State of
New York.
Very truly yours,
[SECURED CREDIT FACILITY PROVIDER]
By
Name:
Title:
Acknowledged and Agreed to
as of the date first above written:
BANKERS TRUST COMPANY,
not in its individual capacity, but
solely as the Security Trustee
By
Name:
Title:
52
EXHIBIT B
SECURITY TRUST AGREEMENT
FORM OF SWAP PROVIDER SUPPLEMENT
Bankers Trust Company, as Security Trustee
Four Albany Street
New York, New York 10006 [Date]
Attention: [ ]
Re: Security Trust Agreement, dated as of March 3, 1998
Reference is made to the Security Trust Agreement, dated as of March 3,
1998 (the "Security Trust Agreement"), among MORGAN STANLEY AIRCRAFT FINANCE, a
Delaware business trust created under the Third Amended and Restated Trust
Agreement, dated as of March 3, 1998, among MS Financing Inc., as depositor,
Wilmington Trust Company, as the Delaware Trustee, the Independent Trustees,
the Alternate Controlling Trustee and the Controlling Trustees party thereto,
the ISSUER SUBSIDIARIES party thereto, CABOT AIRCRAFT SERVICES LIMITED, a
company incorporated under the laws of Ireland, as the Administrative Agent,
BANKERS TRUST COMPANY, a New York banking corporation, as the Cash Manager,
INTERNATIONAL LEASE FINANCE CORPORATION, a corporation incorporated under the
laws of the State of California, as the Servicer, INTERNATIONAL LEASE FINANCE
CORPORATION, as credit facility provider under the Custody and Loan Agreement,
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO., as credit facility provider under
the Loan Agreement, BANKERS TRUST COMPANY, not in its individual capacity
(except as otherwise provided in the Indenture), but solely in its capacity as
trustee under the Indenture, BANKERS TRUST COMPANY, not in its individual
capacity, but solely as the initial Reference Agent, and BANKERS TRUST COMPANY,
not in its individual capacity (except as otherwise provided pursuant to
Sections 6.02(i) and 6.03(ii) of the Security Trust Agreement), but solely as
the initial Security Trustee (the "Security Trustee"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
them in the Security Trust Agreement.
The undersigned hereby:
1. confirms that attached hereto is a true and complete copy of the
_________ Agreement, between the Issuer and the undersigned, dated as of
____ (the "Swap Agreement"), which Swap Agreement meets the requirements
of Section 9.05 of the Indenture;
53
2. confirms that it has received a copy of the Security Trust
Agreement and such other documents and information as it deems
appropriate to make a decision to enter into this Swap Provider
Supplement;
3. confirms that upon entering into this Swap Provider Supplement,
the undersigned shall become a party to the Security Trust Agreement,
subject to the terms and provisions thereof, including Sections 8.01(c)
and 8.03(c) thereof, and each reference in the Security Trust Agreement
to a "Secured Party" shall also mean and be a reference to the
undersigned;
4. appoints and authorizes the Senior Trustee to take any and all
actions in respect of the Collateral as are delegated to the Senior
Trustee by the terms of the Relevant Documents, together with any such
powers and discretion as are reasonably incidental thereto;
5. confirms its agreement to the limitations and qualifications of
the Security Trustee's obligations set forth in Article VI of the
Security Trust Agreement;
6. confirms that this Swap Provider Supplement shall be governed by,
and construed in accordance with, the laws of the State of New York.
Very truly yours,
[SECURED SWAP PROVIDER]
By
Name:
Title:
Acknowledged and Agreed to
as of the date first above written:
BANKERS TRUST COMPANY,
not in its individual capacity, but
solely as the Security Trustee
By
Name:
Title:
54
EXHIBIT C
SECURITY TRUST AGREEMENT
[FORM OF SECURITY TRUST AGREEMENT SUPPLEMENT]
Bankers Trust Company, as Security Trustee
Four Albany Street
New York, New York 10006 [Date]
Attention: [ ]
Re: Security Trust Agreement, dated as of March 3, 1998
Gentlemen/Women:
Reference is made to the Security Trust Agreement, dated as of March 3,
1998 (the "Security Trust Agreement"), among MORGAN STANLEY AIRCRAFT FINANCE, a
Delaware business trust created under the Third Amended and Restated Trust
Agreement, dated as of March 3, 1998, among MS Financing Inc., as depositor,
Wilmington Trust Company, as the Delaware Trustee, the Independent Trustees,
the Alternate Controlling Trustee and the Controlling Trustees party thereto,
the ISSUER SUBSIDIARIES party thereto, CABOT AIRCRAFT SERVICES LIMITED, a
company incorporated under the laws of Ireland, as the Administrative Agent,
BANKERS TRUST COMPANY, a New York banking corporation, as the Cash Manager,
INTERNATIONAL LEASE FINANCE CORPORATION, a corporation incorporated under the
laws of the State of California, as the Servicer, INTERNATIONAL LEASE FINANCE
CORPORATION, as credit facility provider under the Custody and Loan Agreement,
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO., as credit facility provider under
the Loan Agreement, BANKERS TRUST COMPANY, not in its individual capacity
(except as otherwise provided in the Indenture), but solely in its capacity as
trustee under the Indenture, BANKERS TRUST COMPANY, not in its individual
capacity, but solely as the initial Reference Agent, and BANKERS TRUST COMPANY,
not in its individual capacity (except as otherwise provided pursuant to
Sections 6.03(i) and 6.03(ii) of the Security Trust Agreement), but solely as
the initial Security Trustee (the "Security Trustee"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
them in the Security Trust Agreement.
The undersigned hereby agrees, as of the date first above written, to
become a Grantor under the Security Trust Agreement as if it were an original
party thereto and agrees that each reference in the Security Trust Agreement to
"Grantor" shall also mean and be a reference to the undersigned.
The undersigned hereby assigns and pledges to the Security Trustee for its
benefit and the benefit of the Secured Parties, and hereby grants to the
Security Trustee for
55
its benefit and the benefit of the Secured Parties a security interest in, all
of its right, title and interest in and to:
(a) all of the following (collectively, the "Non-Trustee Account
Collateral"):
(i) all of the Non-Trustee Accounts (to the extent permitted
by applicable law) in such Grantor's name, all funds held or
required by the terms of the Indenture and any Guarantor Indenture
to be held therein and all certificates and instruments, if any,
from time to time representing or evidencing such Non-Trustee
Accounts;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution for or in addition to any or all of
the then existing Non-Trustee Account Collateral; and
(ii) all interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the then
existing Non-Trustee Account Collateral;
(b) all of the following (collectively, the "Cash Collateral"):
(i) all funds of such Grantor held or required by the terms of
the Indenture to be held in the Accounts and all certificates and
instruments, if any, from time to time representing or evidencing
such funds;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution for or in addition to any or all of
the then existing Cash Collateral; and
(iii) all interest, dividends, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing Cash
Collateral;
(c) all "investment property" (as defined in Section 9-115(1)(f) of
the UCC) of such Grantor, and all of the following (the "Investment
Collateral"):
(i) all Permitted Account Investments made or acquired from or
with the proceeds of any Non-Trustee Account Collateral or Cash
Collateral of such Grantor from time to time and all certificates
and instruments, if any, from time to time representing or
evidencing such Permitted Account
56
Investments;
(ii) all notes, certificates of deposit, deposit accounts,
checks and other instruments from time to time hereafter delivered
to or otherwise possessed by the Security Trustee for or on behalf
of such Grantor in substitution of or in addition to any or all of
the then existing Investment Collateral; and
(iii) all interest, dividends, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the then existing
Investment Collateral; and
(d) all of the following (the "Security Collateral"):
(i) [ENUMERATE THE STOCK OF THE SUBSIDIARIES PLEDGED BY SUCH
GRANTOR] (the "Pledged Stock") held by it and the certificates
representing such Pledged Stock, and all dividends, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange
for any or all of such Pledged Stock;
(ii) [ENUMERATE THE DEBT OF THE SUBSIDIARIES PLEDGED BY SUCH
GRANTOR] (the "Pledged Debt") and the instruments evidencing the
Pledged Debt, and all interest, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the
Pledged Debt;
(iii) all additional shares of Stock from time to time
acquired by such Grantor in any manner, and the certificates
representing such additional shares and all dividends, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange
for any or all such additional shares; and
(iv) all additional indebtedness from time to time owed to
such Grantor by any MSAF Group Member and the instruments
evidencing such indebtedness, and all interest, cash, instruments
and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all
of such indebtedness;
(e) all of the following (the "Beneficial Interest Collateral"):
(i) all of such Grantor's right, title and interest in
[ENUMERATE BENEFICIAL INTEREST PLEDGED BY SUCH GRANTOR] (the
"Pledged Beneficial Interest") held by it, all certificates, if
any, from time to time representing the Pledged Beneficial Interest
and all distributions, cash, instruments and other property from
time to time received, receivable or otherwise distributed in
respect of or in exchange for
57
any or all of such Pledged Beneficial Interest; and
(ii) all of such Grantor's right, title and interest in all
additional beneficial interests in any MSAF Group members from time
to time acquired by such Grantor in any manner, all certificates,
if any, from time to time representing all such beneficial
interests and all distributions, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all such
additional beneficial interests;
(f) all of such Grantor's right, title and interest in and to all
Leases to which Grantor is or may from time to time be party and any
leasing arrangements among MSAF Group Members with respect to such Leases
(the "Assigned Leases"), including without limitation, (A) all rights of
such Grantor to receive moneys due and to become due under or pursuant to
such Assigned Leases, (B) all rights of such Grantor to receive proceeds
of any Insurance, indemnity, warranty or guaranty with respect to such
Assigned Leases, (C) claims of such Grantor for damages arising out of or
for breach or default under such Assigned Leases and (D) the right of
such Grantor to terminate such Assigned Leases, to perform thereunder and
to compel performance and otherwise exercise all remedies thereunder,
whether arising under such leases or by statute or at law or in equity;
[(g) enumerate any other collateral granted by the Grantor]; and
(h) all proceeds of any and all of the foregoing collateral
(including, without limitation, proceeds that constitute property of the
types described in subsections (a), (b), and (c), above).
The undersigned hereby makes each representation and warranty set forth in
Section 2.07 of the Security Trust Agreement (as supplemented by the attached
Annexes) and hereby agrees to be bound as a Grantor by all of the terms and
provisions of the Security Trust Agreement. Each reference in the Security
Trust Agreement to the Pledged Stock, the Pledged Debt, the Security
Collateral, the Assigned Leases, the Pledged Beneficial Interest and the
Beneficial Interest Collateral shall be construed to include a reference to the
corresponding Collateral hereunder.
The undersigned hereby agrees, together with the Issuer, jointly and
severally to indemnify the Security Trustee, its officers, directors, employees
and agents in the manner set forth in Section 9.01 of the Security Trust
Agreement.
Attached is (i) an Account Letter in substantially the form of Exhibit D
to the Security Trust Agreement from the Non-Trustee Account Bank at which such
Non-Trustee Account is located and (ii) duly completed copies of Annex I and
Annex II hereto.
This Security Trust Agreement Supplement shall be governed by, and
construed in accordance with, the laws of the State of New York.
58
Very truly yours,
[NAME OF GRANTOR]
By
Name:
Title:
Acknowledged and agreed to
as of the date first above written:
BANKERS TRUST COMPANY,
not in its individual capacity, but
solely as the initial Security Trustee
By
Name:
Title:
59
ANNEX I
SECURITY AGREEMENT SUPPLEMENT
TRADE NAMES
60
ANNEX II
SECURITY AGREEMENT SUPPLEMENT
CHIEF PLACE OF BUSINESS
AND
CHIEF EXECUTIVE OR REGISTERED OFFICE
61
EXHIBIT D
SECURITY TRUST AGREEMENT
FORM OF NON-TRUSTEE ACCOUNT LETTER
_______________, 1998
[Name and address
of Account Bank]
[Name of the Grantor]
Gentlemen/women:
Reference is made to Account No. __________ into which certain monies,
instruments and other properties are deposited from time to time (the "Pledged
Account") maintained with you by ____________________ (the "Grantor").
Pursuant to the Security Trust Agreement, dated as of March 3, 1998 (the
"Security Trust Agreement"), among the Grantor, Bankers Trust Company, as the
Administrative Agent (the "Administrative Agent"), various other parties and
Bankers Trust Company, not in its individual capacity (except as otherwise
provided pursuant to Sections 6.03(i) and 6.03(ii) of the Security Trust
Agreement), but solely as the initial Security Trustee (the "Security
Trustee"). Capitalized terms used herein, unless otherwise defined herein,
have the meanings assigned to them in the Security Trust Agreement.
Pursuant to the Security Trust Agreement, the Grantor has granted to the
Security Trustee a security interest in certain property of the Grantor,
including, among other things, the following (the "Collateral"): the Pledged
Account, all funds held or required by the terms of the Indenture or any
Guarantor Indenture to be held therein and all certificates and instruments, if
any, from time to time representing or evidencing such Pledged Account, all
notes, certificates of deposit, deposit accounts, checks and other instruments
from time to time hereafter delivered to or otherwise possessed by the Security
Trustee for or on behalf of such Grantor in substitution for or in addition to
any or all of the then existing Collateral, and all interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the then
existing Collateral, and all proceeds of any and all of the foregoing
Collateral. It is a condition to the continued maintenance of the Pledged
Account with you that you agree to this letter agreement.
By signing this letter agreement, you acknowledge notice of, and consent
to the terms and provisions of, the Security Trust Agreement and confirm to the
Security Trustee that you have received no notice of any other pledge or
assignment of the Pledged Account. Further, you hereby agree with the Security
Trustee that:
(a) Notwithstanding anything to the contrary in any other agreement
relating to the Pledged Account, the Pledged Account is and will be
subject to the
62
terms and conditions of the Security Trust Agreement, and will be
subject to written instructions only from an officer of the Security
Trustee or from an officer of the Administrative Agent.
(b) You will follow your usual operating procedures for the handling
of any remittance received in the Pledged Account, including any
remittance that contains restrictive endorsements, irregularities (such
as a variance between the written and numerical amounts), undated or
postdated items, missing signatures, incorrect payees, etc.
(c) You will transfer, in same day funds, on each of your business
days, an amount equal to the credit balance of the Pledged Account (other
than any amount required to be left on deposit for local tax or other
regulatory or legal purposes) on such day to the following account (the
"Collection Account"):
[Insert address of Operating Bank and
account number of the Collection Account]
Each such transfer of funds shall neither comprise only part of a
remittance nor reflect the rounding off of any funds so transferred.
(d) All service charges and fees with respect to the Pledged Account
shall be payable by the Grantor, and deposited checks returned for any
reason shall not be charged to such account.
(e) The Security Trustee and the Administrative Agent shall be
entitled to exercise any and all rights of the Grantor in respect of the
Pledged Account in accordance with the terms of the Security Trust
Agreement, and the undersigned shall comply in all respects with such
exercise.
This letter agreement shall be binding upon you and your successors and
assigns and shall inure to the benefit of the Security Trustee, the Secured
Parties and their successors, transferees and assigns. You may terminate this
letter agreement only upon 30 days' prior written notice to the Grantor and the
Security Trustee. Upon such termination you shall close the Pledged Account
and transfer all funds in the Pledged Account to the Collection Account. After
any such termination, you shall nonetheless remain obligated promptly to
transfer to the Collection Account all funds and other property received in
respect of the Pledged Account.
This letter agreement shall be governed by and construed in accordance
with the laws of the State of New York.
Very truly yours,
[NAME OF GRANTOR]
63
By
Name:
Title:
BANKERS TRUST COMPANY,
not in its individual capacity,
but solely as the initial
Security Trustee
By
Name:
Title:
Acknowledged and agreed to as of
the date first above written:
[NAME OF PLEDGED ACCOUNT BANK]
By
Name:
Title:
64
EXHIBIT E
SECURITY TRUST AGREEMENT
FORM OF CONSENT AND AGREEMENT
_______________, 1998
[Name of the Grantor]
Gentlemen/women:
Reference is made to the agreement between you and the Grantor dated
[(the "Assigned Agreement")] [(the "Assigned Lease")].
Pursuant to the Security Trust Agreement, dated March 3, 1998 (the
"Security Trust Agreement"), among the Grantor, Bankers Trust Company, not in
its individual capacity (except as otherwise provided pursuant to Sections
6.03(i) and 6.03(ii) of the Security Trust Agreement), but solely as the
initial Security Trustee (the "Security Trustee"), and various parties thereto,
the Grantor has granted to the Security Trustee a security interest in certain
property of the Grantor, including, among other things, the following (the
"Collateral"): [all of such Grantor's right, title and interest in and to the
Assigned Agreement] [all of such Grantor's right, title and interest in and to
the Assigned Lease, including without limitation, all rights of such Grantor to
receive moneys due and to become due under or pursuant to the Assigned Lease,
all rights of such Grantor to receive proceeds of any insurance, indemnity,
warranty or guaranty with respect to the Assigned Lease, claims of such Grantor
for damages arising out of or for breach or default under the Assigned Lease
and the right of such Grantor to terminate the Assigned Lease, to perform
thereunder and to compel performance and otherwise exercise all remedies
thereunder, whether arising under the Assigned Lease or by statute or at law or
in equity.] Capitalized terms used herein, unless otherwise defined herein,
have the meanings assigned to them in the Security Trust Agreement.
By signing this Consent and Agreement, you acknowledge notice of, and
consent to the terms and provisions of, the Security Trust Agreement and
confirm to the Security Trustee that you have received no notice of any other
pledge or assignment of the [Assigned Agreement] [Assigned Lease]. Further,
you hereby agree with the Security Trustee that:
(a) You will make all payments to be made by you under or in connection
with the [Assigned Agreement] [Assigned Lease] directly to the [Rental Account]
[Collection Account] or otherwise in accordance with the instructions of the
Security Trustee.
(b) The Security Trustee shall be entitled to exercise any and all rights
and remedies of the Grantor under the [Assigned Agreement] [Assigned Lease] in
65
accordance with the terms of the Security Trust Agreement, and you will
comply in all respects with such exercise.
(c) [ONLY WITH RESPECT TO ASSIGNED AGREEMENTS] You will not, without the
prior written consent of the Security Trustee, (i) cancel or terminate the
Assigned Agreement or consent to or accept any cancellation or termination
thereof or (ii) amend or otherwise modify the Assigned Agreement.
This Consent and Agreement shall be binding upon you and your successors
and assigns and shall inure to the benefit of the Security Trustee, the Secured
Parties and their successors, transferees and assigns.
This Consent and Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
Very truly yours,
[NAME OF GRANTOR]
By
Name:
Title:
BANKERS TRUST COMPANY,
not in its individual capacity,
but solely as the initial
Security Trustee
By
Name:
Title:
Acknowledged and agreed to as of
the date first above written:
[NAME OF OBLIGOR/LESSEE]
By
Name:
Title:
66
EXHIBIT F
SECURITY TRUST AGREEMENT
FORM OF SERVICE PROVIDER SUPPLEMENT
Bankers Trust Company, as Security Trustee
Four Albany Street
New York, New York 10006 [Date]
Attention: [ ]
Re: Security Trust Agreement, dated as of March 3, 1998
Reference is made to the Security Trust Agreement, dated as of March 3,
1998 (the "Security Trust Agreement"), among MORGAN STANLEY AIRCRAFT FINANCE, a
Delaware business trust created under the Third Amended and Restated Trust
Agreement, dated as of March 3, 1998, among MS Financing Inc., as depositor,
Wilmington Trust Company, as the Delaware Trustee, the Independent Trustees,
the Alternate Controlling Trustee and the Controlling Trustees party thereto,
the ISSUER SUBSIDIARIES party thereto, CABOT AIRCRAFT SERVICES LIMITED, a
company incorporated under the laws of Ireland, as the Administrative Agent,
BANKERS TRUST COMPANY, a New York banking corporation, as the Cash Manager,
INTERNATIONAL LEASE FINANCE CORPORATION, a corporation incorporated under the
laws of the State of California, as the Servicer, INTERNATIONAL LEASE FINANCE
CORPORATION, as credit facility provider under the Custody and Loan Agreement,
MORGAN STANLEY, DEAN WITTER, DISCOVER & CO., as credit facility provider under
the Loan Agreement, BANKERS TRUST COMPANY, not in its individual capacity
(except as otherwise provided in the Indenture), but solely in its capacity as
trustee under the Indenture, BANKERS TRUST COMPANY, not in its individual
capacity, but solely as the initial Reference Agent, and BANKERS TRUST COMPANY,
not in its individual capacity (except as otherwise provided pursuant to
Sections 6.02(i) and 6.03(ii) of the Security Trust Agreement), but solely as
the initial Security Trustee (the "Security Trustee"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to
them in the Security Trust Agreement.
The undersigned hereby:
1. confirms that attached hereto is a true and complete copy of the
_________ Agreement, between the Issuer and the undersigned, dated as of
____ (the "Service Provider Agreement");
67
2. confirms that it has received a copy of the Security Trust
Agreement and such other documents and information as it deems
appropriate to make a decision to enter into this Service Provider
Supplement;
3. confirms that upon entering into this Service Provider
Supplement, the undersigned shall become a party to the Security Trust
Agreement, subject to the terms and provisions thereof, including
Sections 8.01(c) and 8.03(c) thereof, and each reference in the Security
Trust Agreement to a "Secured Party" shall also mean and be a reference
to the undersigned;
4. appoints and authorizes the Senior Trustee to take any and all
actions in respect of the Collateral as are delegated to the Senior
Trustee by the terms of the Relevant Documents, together with any such
powers and discretion as are reasonably incidental thereto;
5. confirms its agreement to the limitations and qualifications of
the Security Trustee's obligations set forth in Article VI of the
Security Trust Agreement;
6. confirms that this Service Provider Supplement shall be governed
by, and construed in accordance with, the laws of the State of New York.
Very truly yours,
[SERVICE SWAP PROVIDER]
By
Name:
Title:
Acknowledged and Agreed to
as of the date first above written:
BANKERS TRUST COMPANY,
not in its individual capacity, but
solely as the Security Trustee
By
Name:
Title: