AIRCRAFT LEASE AGREEMENT
dated as of ___________________ ("Agreement")
This Agreement (together with all supplements, annexes. exhibits and schedules
hereto hereinafter referred to as the "Lease") is between General Electric
Capital Corporation, with an office at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000 X.X.
Xxx 0000, Xxxxxxxxxx, XX 00000-0000 (hereinafter called, together with its
successors and assigns, if any, "Lessor") and Smart Choice Automotive Group,
Inc., a corporation organized and existing under the laws of the State of
Florida with its mailing address and chief place of business at 0000 X.
Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 (hereinafter called "Lessee").
1. LEASING:
(a) Subject to the terms and conditions set forth below, Lessor agrees
to lease to Lessee, and Lessee agrees to lease from Lessor, the aircraft,
including the airframe, engines and all appurtenant equipment (together
hereinafter the "Aircraft") described in Annex A.
(b) Lessor shall purchase the Aircraft from the manufacturer or
supplier thereof ("Supplier") and lease it to Lessee if on or before the Last
Delivery Date (specified in Annex B) Lessor receives each of the following
documents in form and substance satisfactory to Lessor: (i) a copy of this Lease
executed by Lessee, (ii) unless Lessor shall have delivered its purchase order
for the Aircraft or received a xxxx of sale for the Aircraft in the name of
Lessor (and in form and substance satisfactory to Lessor), the Purchase
Document(s) Assignment and Consent in the form of Annex C, with copies of the
purchase order or other purchase documents attached thereto; (iii) copies of
insurance policies or, at Lessor's option, such other evidence of insurance
which complies with the requirements of Section 10, (iv) evidence of an N number
for the Aircraft together with an assignment of the rights thereto to Lessor;
(v) evidence that the Aircraft has been duly certified as to type and
airworthiness by the Federal Aviation Administration ("FAA"); (vi) evidence that
Lessor's designated FAA escrow agent (which may be FAA counsel) has received in
escrow the executed xxxx of sale and AC Form 8050-1 Aircraft Registration Form
(except for the pink copy which shall be available to be placed on the Aircraft
upon acceptance thereof), and an executed duplicate of this Lease all In proper
form for filing with the FAA; (vii) resolution of Lessee authorizing this Lease
in the form of Annex D; (viii) a completed inspection and/or survey with respect
to the Aircraft in accordance with the requirements set forth in the Certificate
of Acceptance; and (ix) such other documents as Lessor may reasonably request.
Lessor's obligation to lease the Aircraft hereunder is further conditioned upon
(1) the cost to Lessor of the acquisition of the Aircraft not exceeding the
Capitalized Lessor's Cost stated on Annex A; (2) upon delivery of the Aircraft
Lessee's execution and delivery to Lessor of a Certificate of Acceptance in the
form of Annex E; and (3) filing of all necessary documents with, and the
acceptance thereof by, the FAA.
(c) Lessor hereby appoints Lessee its agent for inspection and
acceptance of the Aircraft from the Supplier. Once the Certificate of Acceptance
has been signed, Lessee may not cancel this Lease.
2. TERM, RENT AND PAYMENT:
(a) The rent ("Rent") payable for the Aircraft and Lessee's right to
use the Aircraft begins on the date Lessee signs the Certificate of Acceptance
("Commencement Date"). The term ("Term") of this Lease shall commence on the
Commencement Date and shall continue, unless earlier terminated pursuant to the
provisions of this Lease, until and including the Expiration Date stated in
Annex B. If any Term is extended or renewed, the word "Term" shall be deemed to
refer to all extended or renewal Terms, and all provisions of this Lease shall
apply during any such extension or renewal Terms, except as may be otherwise
specifically provided in writing.
(b) Lessee shall pay rent to Lessor at its address stated above, except
as otherwise directed by Lessor. Rent payments shall be in the amount, payable
at such intervals and due in accordance with the provisions of Annex B. (Each
payment of Rent is hereinafter referred to as a "Rent Payment"). If one or more
Advance Rent is payable, such Advance Rent shall be (i) set forth on Annex B and
due in accordance with the provisions of Annex B, and (ii) when received by
Lessor, applied to the first Basic Term for Rent Payment as set forth on Annex B
and the balance, if any, to the final Rent Payment(s), in inverse order of
maturity, In no event shall any Advance Rent or any other Rent Payment be
refunded to Lessee. If Rent is not paid within ten (10) days of its due date,
Lessee agrees to pay a late charge of five cents ($.05) per dollar on, and in
addition to, the amount of such Rent but not exceeding the lawful maximum if
any.
3. RENT ADJUSTMENT:
(a) If, solely as a result of Congressional enactment of any law
(including, without limitation, any modification of, or amendment or addition
to, the Internal Revenue Code of 1986, as amended, ("Code")), the maximum
effective corporate income tax rate (exclusive of any minimum tax rate) for
calendar-year taxpayers ("Effective Rate") is higher than thirty-five percent
(35%) for any year during the Term of this Lease, then Lessor shall have the
right to increase such rent payments by requiring payment of a single additional
sum. The additional sum shall be equal to the product of (i) the Effective Rate
(expressed as a decimal) for such year less .35 (or, in the event that any
adjustment has been made hereunder for any previous year, the Effective Rate
(expressed as a decimal) used in calculating the next previous adjustment) times
(ii) the adjusted Termination Value (defined below) divided by (iii) the
difference between the new Effective Rate (expressed as a decimal) and one (1).
The adjusted Termination Value shall be the Termination Value (calculated as of
the first rental due in the year for which such adjustment is being made) minus
the Tax Benefits that would be allowable under Section 168 of the Code (as of
the first day of the year for which such adjustment is being made and all future
years of the lease term). The Termination Values are defined on Annex F and the
Tax Benefits are defined on Annex B. Lessee shall pay to Lessor the full amount
of the additional rent payment on the later of (i) receipt of notice or (ii) the
first day of the year for which such adjustment is being made.
(b) Lessee's obligations under this Section 3 shall survive any
expiration or termination of this Agreement.
4. TAXES AND FEES: If permitted by law, Lessee shall report and pay promptly all
taxes, fees and assessments due, imposed, assessed or levied against the
Aircraft (or purchase, ownership, delivery, leasing, possession, use or
operation thereof), this Agreement (or any rents or receipts hereunder), any
Schedule, Lessor or Lessee, by any domestic or foreign governmental entity or
taxing authority during or related to the term of this Agreement, including,
without limitation, all license and registration fees, and all sales, use,
personal property, excise, gross receipts, franchise, stamp, value added, custom
duties, landing fees, airport charges, navigation service charges, route
navigation charges or other taxes, imposts, duties and charges, together with
any penalties, fines or interest thereon (collectively "Taxes"). Lessee shall
have no liability for Taxes imposed by the United States of America or any state
or political subdivision thereof which are on or measured by the net income of
Lessor except as provided in Sections 3 and 14(c). Lessee shall promptly
reimburse (on an after tax basis) Lessor for any Taxes charged to or assessed
against Lessor. Lessee shall show Lessor as the owner of the Aircraft on all tax
reports or returns, and send Lessor a copy of each report or return and evidence
of Lessees payment of Taxes upon request.
5. REPORTS: Lessee will provide Lessor with the following in writing within the
time periods specified: (a) notice of any tax or other lien which attaches to
the Aircraft and the full particulars of the tax or lien, within ten (10) days
after Lessee becomes aware of the tax or lien, (b) Lessee's complete financial
statements, certified by a recognized firm of certified public accountants,
within ninety (90) days of the close of each fiscal year of Lessee, and any
further financial information or report, upon request; (c) notice to Lessor of
the Aircraft's location, and the location of all information, logs, documents
and records relating to the Aircraft and its use, maintenance and/or condition,
immediately upon request; (d) notice to Lessor of the relocation of the
Aircraft's primary hangar location, ten (10) days prior to any relocation; (e)
notice of loss or damage to the Aircraft which would cost more than the lesser
of (i) ten percent (10%) of the original Capitalized Lessor's Cost or (ii) two
hundred fifty thousand Dollars ($250,000,00) to repair or replace, within ten
(10) days of such loss or damage; (f) notice of any accident involving the
Aircraft causing personal injury or property damage, within ten (10) days of
such accident; (g) copies of the insurance policies or other evidence of
insurance required by the terms hereof, promptly upon request by Lessor; (h)
copies of all information, logs, documents and records relating to the Aircraft
and its use, maintenance and/or condition, within ten (10) days of such request;
(i) on each annual anniversary of the Commencement Date of this Lease, a
certificate of the authorized officer of Lessee stating that he has reviewed the
activities of Lessee and that, to the best of his knowledge, there exists no
Event of Default or event which with notice or lapse of time (or both) would
become an Event of Default; (j) such information as may be required to enable
Lessor to file any reports required by any governmental authority as a result of
Lessor's ownership of the Aircraft promptly upon request of Lessor; (k) copies
of any manufacturer's maintenance service program contract for the airframe or
engines, promptly upon request by Lessor; (1) evidence of Lessee's compliance
with FAA airworthiness directives and advisory circulars and of compliance with
other maintenance provisions of Section 7 hereof and the return provisions of
Section 11, promptly upon request of Lessor; and (m) such other reports as
Lessor may reasonably request.
6. DELIVERY, REGISTRATION, USE AND OPERATION:
(a) The Aircraft shall be delivered directly from the Supplier to
Lessee unless the Aircraft is being leased pursuant to a sale leaseback
transaction in which case Lessee acknowledges that it is in possession of the
Aircraft as of the Lease Commencement Date.
(b) Lessee, at its own cost and expense, shall cause the Aircraft to be
duly registered in the name of Lessor under the Title 49, Subtitle VII of the
United States Code, as amended (the "FAA Act"), and shall not register the
Aircraft under the laws of any other country.
(c) The possession, use and operation of the Aircraft shall be at the
sole risk and expense of Lessee. Lessee acknowledges that I (accepts full
operational control of the Aircraft. Lessee agrees that the Aircraft will be
used and operated in compliance with any and all statutes, laws. ordinances,
regulations and standards or directives issued by any governmental agency
applicable to the use or operation thereof, in compliance with any airworthiness
certificate, license or registration relating to the Aircraft issued by any
agency and in a manner that does not modify or impair any existing warranties on
the Aircraft or any part thereof. Lessee will operate the Aircraft predominantly
in the conduct of its business and will not use or operate, or permit the
Aircraft to be used or operated, (i) in violation of any United States export
control law, (ii) in a manner wherein the predominant use during any twelve
month period is for a purpose other than transportation for Lessee, or in a
manner, for any time period, such that Lessor or a third party shall be deemed
to have "operational control" of the Aircraft, or (iii) for the carriage of
persons or property for hire or the transport of mail or contraband. The
Aircraft will, at all times be operated by duly qualified pilots holding at
least a valid airline transport pilot certificate and instrument rating and any
other certificate, rating, type rating or endorsement appropriate to the
Aircraft purpose of flight, condition of flight or as otherwise required by the
Federal Aviation Regulations ("FAR"). The Aircrafts pilots shall be employed
and/or paid and contracted for by Lessee, shall meet all recency of flight
requirements and shall meet the requirements established and specified by the
insurance policies required under this Lease and the FAA. The primary hangar
location of the Aircraft shall be as stated in Annex B. Lessee shall not
relocate the primary hangar location to a hangar location outside the United
States. Lessor may examine and inspect the Aircraft, wherever located, on land
and in flight, after giving Lessee reasonable prior notice.
(d) AT ALL TIMES DURING THE TERM OF THE LEASE, THE AIRCRAFT WILL BE
LOCATED AND USED SOLELY WITHIN THE CONTINENT OF NORTH AMERICA AND THE CARIBBEAN.
(i) AT ALL TIMES DURING THE TERM OF THE LEASE, LESSEE AGREES
NOT TO OPERATE OR LOCATE THE AIRCRAFT, OR ALLOW THE AIRCRAFT TO BE OPERATED OR
LOCATED, IN OR OVER ANY AREA OF HOSTILITIES, ANY GEOGRAPHIC AREA WHICH IS NOT
COVERED BY THE INSURANCE POLICIES REQUIRED BY THIS LEASE, OR ANY COUNTRY OR
JURISDICTION FOR WHICH EXPORTS OR TRANSACTIONS ARE SUBJECT TO SPECIFIC
RESTRICTIONS UNDER ANY UNITED STATES EXPORT OR OTHER LAW OR UNITED NATIONS
SECURITY COUNCIL DIRECTIVE, INCLUDING WITHOUT LIMITATION, THE TRADING WITH THE
ENEMY ACT, 50 U.S.C. APP. SECTIONS 1 ET SEQ., THE INTERNATIONAL EMERGENCY
ECONOMIC POWERS ACT, 50 U.S.C. APP. SECTIONS 1701 ET SEQ., AND THE EXPORT
ADMINISTRATION ACT, 50 U.S.C. APP. SECTIONS 2401 ET SEQ. OR TO OTHERWISE
VIOLATE, OR PERMIT THE VIOLATION OF, SUCH LAWS OR DIRECTIVES. LESSEE ALSO AGREES
TO PROHIBIT ANY NATIONAL OF SUCH RESTRICTED NATIONS FROM OPERATING THE AIRCRAFT.
(ii) Lessee represents and warrants that it does not on this
date hold a contract or other obligation to operate the Aircraft in any of the
following countries: Cuba, Iraq, Libya, Myanmar, North Korea, and the Federal
Republic of Yugoslavia (Serbia and Montenegro).
(iii) The engines set forth on Annex A shall be used only on
the airframe described in Annex A and shall only be removed for maintenance in
accordance with the provisions of this Lease.
(e) Lessor shall not disturb Lessees quiet enjoyment of the Aircraft
during the Term of this Lease unless an Event of Default has occurred and is
continuing under this Lease.
7. MAINTENANCE:
(a) Lessee agrees that the Aircraft will be maintained in compliance
with any and all statutes, laws, ordinances, regulations and standards or
directives issued by any governmental agency applicable to the maintenance
thereof, in compliance with any airworthiness certificate, license or
registration relating to the Aircraft issued by any agency and in a manner that
does not modify or impair any existing warranties on the Aircraft or any part
thereof.
(b) Lessee shall maintain, inspect, service, repair, overhaul and test
the Aircraft (including each engine) in accordance with (i) all maintenance
manuals initially furnished with the Aircraft, including any subsequent
amendments or supplements to such manuals issued by the manufacturer from time
to time, (ii) all mandatory or otherwise required "Service Bulletins" issued,
supplied, or available by or through the manufacturer and/or the manufacturer of
any engine or part with respect to the Aircraft, (iii) all airworthiness
directives applicable to the Aircraft issued by the FAA or similar regulatory
agency having jurisdictional authority, and causing compliance to such
directives to be completed through corrective modification in lieu of operating
manual restrictions, and (iv) all maintenance requirements set forth in Annex G
hereto. Lessee shall maintain all records, logs and other materials required by
the manufacturer for enforcement of any warranties or by the FAA. All
maintenance procedures required hereby shall be undertaken and completed in
accordance with the manufacturer's recommended procedures, and by properly
trained, licensed, and certificated maintenance sources and maintenance
personnel, so as to keep the Aircraft and each engine in as good operating
condition as when delivered to Lessee hereunder, ordinary wear and tear
excepted, and so as to keep the Aircraft in such operating condition as may be
necessary to enable the airworthiness certification of such Aircraft to be
maintained in good standing at all times under the FAA.
(c) Lessee agrees, at its own cost and expense, to (i) cause the
Aircraft and each engine thereon to be kept numbered with the identification in
serial number therefor as specified in Annex A; (ii) prominently display on the
Aircraft that N number, and only that N number, specified in Annex A, and (iii)
notify Lessor in writing thirty (30) days prior to making any change in the
configuration (other than changes in configuration mandated by the FAA),
appearance and coloring of the Aircraft from that in effect at the time the
Aircraft is accepted by Lessee hereunder, and in the event of such change or
modification of configuration, coloring or appearance, to restore, upon request
of Lessor, the Aircraft to the configuration, coloring or appearance in effect
on the Commencement Date or, at Lessor's option to pay to Lessor an amount equal
to the reasonable cost of such restoration. Lessee will not place the Aircraft
in operation or exercise any control or dominion over the same until such
Aircraft marking has been placed thereon. Lessee will replace promptly any such
Aircraft marking which may be removed, defaced or destroyed.
(d) Lessee shall be entitled from time to time during the Term of this
Lease to acquire and install on the Aircraft at Lessee's expense, any additional
accessory, device or equipment as Lessee may desire (each such accessory, device
or equipment an "Addition"), but only so long as such Addition (i) is ancillary
to the Aircraft; (ii) is not required to render the Aircraft complete for its
intended use by Lessee; (iii) does not alter or impair the originally intended
function or use of the Aircraft; and (iv) can be readily removed without causing
material damage. Title to each Addition which is not removed by Lessee prior to
the return of the Aircraft to Lessor shall vest in Lessor upon such return.
Lessee shall repair all damage to the Aircraft resulting from the installation
or removal of any Addition so as to restore the Aircraft to its condition prior
to installation, ordinary wear and tear excepted.
(e) Any alteration or modification (each an "Alteration") with respect
to the Aircraft that may at any time during the Term of this Lease be required
to comply with any applicable law or any governmental rule or regulation shall
be made at the expense of Lessee. Any repair made by Lessee of or upon the
Aircraft or replacement parts, including any replacement engine, installed
thereon in the course of repairing or maintaining the Aircraft, or any
Alteration required by law or any governmental rule or regulation, shall be
deemed an accession, and tide thereto shall be immediately vested in Lessor
without cost or expense to Lessor.
(f) Except as permitted under this Section 7, Lessee will not modify
the Aircraft or affix or remove any accessory to the Aircraft leased hereunder.
(g) If the Aircraft is to be operated at any time under Part 135 with
the prior written consent of Lessor, then the Aircraft shall be maintained and
operated in accordance with the applicable Part 135 standards.
8. LIENS, SUBLEASE AND ASSIGNMENT:
(a) LESSEE SHALL NOT SELL, TRANSFER, ASSIGN OR ENCUMBER THE AIRCRAFT,
ANY ENGINE OR ANY PART THEREOF, LESSOR'S TITLE OR ITS RIGHTS UNDER THIS LEASE.
LESSEE SHALL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR, SUBLET, CHARTER
OR PART WITH POSSESSION OF THE AIRCRAFT OR ANY ENGINE OR PART THEREOF OR ENTER
INTO ANY INTERCHANGE AGREEMENT. Lessee shall not permit any engine to be used on
any other Aircraft. Lessee shall keep the Aircraft each engine and any part
thereof free and clear of all liens and encumbrances other than those which
result from (i) the respective rights of Lessor and Lessee as herein provided,
(ii) liens arising from the acts of Lessor; (iii) liens for taxes not yet due;
and (iv) inchoate materialmen's. mechanics', workmen's, repairmens', employees'
or other like liens arising in the ordinary course of business of Lessee for
sums not yet delinquent or being contested in good faith (and for the payment of
which adequate assurances in Lessor's judgment have been provided Lessor).
(b) Lessor and any assignee of Lessor may assign this Lease, or any
part hereof and/or the Aircraft, Lessee hereby waives and agrees not to assert
against any such assignee, or assignee's assigns, any defense, set-off
recoupment claim or counterclaim which Lessee has or may at any time have
against Lessor for any reason whatsoever.
9. LOSS, DAMAGE AND STIPULATED LOSS VALUE: Lessee hereby assumes and shall bear
the entire risk of any loss, theft, confiscation, expropriation, requisition,
damage to, or destruction of, the Aircraft any engine or part thereof from any
cause whatsoever. If for any reason the Aircraft, or any engine thereto becomes
worn out, lost, stolen, confiscated, expropriated, requisitioned, destroyed,
irreparably damaged, or unusable ("Casualty Occurrences") Lessee shall promptly
and fully notify Lessor in writing. If, in the opinion of Lessor, a Casualty
Occurrence has occurred which affects only the engine(s) of the Aircraft, then
Lessee, at its own cost and expense, shall replace such engine(s) with an
engine(s) acceptable to Lessor and shall cause title to such engine(s) to be
transferred to Lessor for lease to Lessee under this Lease. Upon transfer of
title to Lessor of such engine(s), such engine(s) shall be subject to the terms
and conditions of this Lease, and Lessee shall execute whatever documents or
filings Lessor deems necessary and appropriate in connection with the
substitution of such replacement engine(s) for the original engine(s). If, in
the opinion of Lessor, a Casualty Occurrence has occurred with respect to the
Aircraft in its entirety, on the next Rent Payment Date after a Casualty
Occurrence (the "Payment Date"), Lessee shall pay Lessor the sum of (i) the
Stipulated Loss Value as set forth in Annex F calculated as of the Rent Payment
Date prior to such Casualty Occurrence; and (ii) all Rent and other amounts
which are due under this Lease as of the Payment Date. Upon payment of all sums
due hereunder, the Term of this Lease as to the Aircraft shall terminate.
10. INSURANCE: Lessee shall secure and maintain in effect at its own expense
throughout the Term of the Lease insurance against such hazards and for such
risks as Lessor may require. All such insurance shall be with companies
satisfactory to Lessor. Without limiting the generality of the foregoing, Lessee
shall maintain (i) liability insurance covering public liability and property,
cargo and environmental damage, in amounts not less than fifty (50) million U.S.
dollars for any single occurrence, (ii) all-risk aircraft hull and engine
insurance (including, without limitation, foreign object damage insurance) in an
amount which is not less than the then Stipulated Loss Value, and (iii)
confiscation, expropriation and war risk insurance. All insurance shall: (1)
name Lessor as owner of the Aircraft and as loss payee and additional insured
(without responsibility for premiums), (2) provide that any cancellation or
substantial change in coverage shall not be effective as to the Lessor for
thirty (30) days after receipt by Lessor of written notice from the insurer of
such cancellation or change, (3) insure Lessor's interest regardless of any
breach of warranty or other act or omission of Lessee, (4) include a
severability of interest clause providing that such policy shall operate in the
same manner as if them were a separate policy covering each insured, (5) waive
any right of set-off against Lessee or Lessor, and any rights of subrogation
against Lessor, and (6) be primary and not be subject to any offset by any other
insurance carried by Lessor or Lessee. Lessee hereby appoints Lessor as Lessee's
attorney-in-fact to make proof of loss and claim for and to receive payment of
and to execute or endorse all documents, checks or drafts in connection with all
policies of insurance in respect of the Aircraft. Lessor shall not act as
Lessee's attorney-in-fact unless Lessee is in default. Lessee shall pay any
reasonable expenses of Lessor in adjusting or collecting insurance proceeds.
Lessor may, at its option, apply proceeds of insurance, in whole or in part, to
(A) repair the Aircraft, or repair or replace any part thereof, or (B) satisfy
any obligation of Lessee to Lessor under this Lease.
11. RETURN OF AIRCRAFT:
(a) At expiration or termination of this Lease (the "Return Date"),
Lessee shall return the Aircraft to Lessor, at a location within the continental
United States as Lessor shall direct. Lessee shall also return all logs, loose
equipment, manuals and data associated with the Aircraft, including without
limitation, inspection, modification and overhaul records required to be
maintained with respect to the Aircraft under this Lease or under the applicable
rules and regulations of the FAA or the manufacturer's recommended maintenance
program, along with a currently effective FAA airworthiness certificate. Lessee
shall, upon request, assign to Lessor its rights under any manufacturer's
maintenance service contract or extended warranty for the Aircraft any engine or
part thereof. The Aircraft shall be returned in the condition in which the
Aircraft is required to be maintained pursuant to Section 7, but with all logos
or other identifying marks of Lessee removed. Additionally, Lessee shall ensure
that the Aircraft complies with all requirements and conditions set forth on
Annex G hereto.
Lessee shall pay for all costs to comply with this Section 11(a).
(b) Lessor shall arrange for the inspection of the Aircraft on the
Return Date to determine if the Aircraft has been maintained and returned in
accordance with the Provisions of this Lease. Lessee shall be responsible for
the cost of such inspection and shall pay Lessor such amount as additional Rent
within ten (10) days of demand. If the results of such inspection indicate that
the Aircraft, any engine thereto or part thereof, has not been maintained or
returned in accordance with the provisions of this Lease, Lessee shall pay to
Lessor within ten (10) days of demand, as liquidated damages, the estimated cost
("Estimated Cost") of servicing or repairing the Aircraft, engine or part. The
Estimated Cost shall be determined by Lessor by obtaining two quotes for such
service or repair work and taking their average. Lessee shall bear the cost, if
any, incurred by Lessor in obtaining such quotes.
(c) If Lessee fails to return the Aircraft on the Return Date, Lessor
shall be entitled to damages equal to the higher of (i) the Rent for the
Aircraft, pro-rated on a per diem basis, for each day the Aircraft is retained
beyond the Return Date; or (ii) the daily fair market rental for the Aircraft at
the Return Date. Such damages for retention of the Aircraft after the Return
Date shall not be interpreted as an extension or reinstatement of the Term.
(d) All of Lessor's rights contained in this Section shall survive the
expiration or other termination of this Lease.
12. EVENT'S OF DEFAULT AND REMEDIES:
(a) The term "Event of Default", wherever used herein, shall mean any
of the following events under this Lease: (i) Lessee breaches its obligation to
pay Rent or any other sum when due and fails to cure the breach within ten (10)
days; or (ii) Lessee breaches any of its insurance obligations under Section 10;
or (iii) Lessee breaches any of its other obligations and fails to cure that
breach within thirty (30) days after written notice from Lessor to Lessee; or
(iv) any representation or warranty made by Lessee in connection with this Lease
shall be false or misleading in any material respect; or (v) Lessee or any
guarantor or other obligor for any of the obligations hereunder (collectively
"Guarantor") becomes insolvent or ceases to do business as a going concern; or
(vi) a petition is filed by or against Lessee or any Guarantor under any
bankruptcy, insolvency or similar laws and in the event of an involuntary
petition, the petition is not dismissed within forty-five (45) days of the
filing date; or (vii) if Lessee or any Guarantor is a natural person, any death
or incompetency of Lessee or such Guarantor; or (viii) Lessee breaches or is in
default under any other agreement by and between Lessor and Lessee.
(b) Upon the occurrence of any Event of Default and so long as the same
shall be continuing, Lessor may, at its option, at any time thereafter, exercise
one or more of the following remedies, as Lessor in its sole discretion shall
lawfully elect: (i) demand that Lessee immediately pay as liquidated damages,
for loss of a bargain and not as a penalty, an amount equal to the Stipulated
Loss Value of the Aircraft, computed as of the Basic Term Rent Date prior to
such demand together with all Rent and other amounts due and payable for all
periods up to and including the Basic Term Rent Date following such demand; (ii)
demand that Lessee pay all amounts due for failure to maintain or return the
Aircraft as provided herein and cause Lessee to assign to Lessor Lessee's rights
under any manufacturer's service program contract or any extended warranty
contract in force for the Aircraft; (iii) proceed by appropriate court action,
either at law or in equity, to enforce the performance by Lessee of the
applicable covenants of this Lease or to recover damages for breach hereof, (iv)
by notice in writing terminate this Lease, whereupon all rights of Lessee to use
of the Aircraft or any part thereof shall absolutely cease and terminate, and
Lessee shall immediately return the Aircraft in accordance with Section I 1, but
Lessee shall remain liable as provided in Section 11; (v) request Lessee to
return the Aircraft to a designated location in accordance with Section 11; (vi)
peacefully enter the premises where the Aircraft may be and take possession of
the Aircraft; (vii) sell or otherwise dispose of the Aircraft at private or
public sale, in bulk or in parcels, with or without notice, and without having
the Aircraft present at the place of sale; (viii) lease or keep idle all or part
of the Aircraft; (ix) use Lessee's premises for storage pending lease or sale or
for holding a sale without liability for rent or costs; (x) collect from Lessee
all costs, charges and expenses, including reasonable legal fees and
disbursements, incurred by Lessor by reason of the occurrence of any Event of
Default or the exercise of Lessor's remedies with respect thereto; and/or (xi)
declare any Event of Default under the terms of this Lease to be a default under
any other agreement between Lessor and Lessee.
(c) Lessor shall have the right to any proceeds of sale, lease or other
disposition of the Aircraft, if any, and shall have the right to apply same in
the following order of priorities: (1) to pay all of Lessor's costs, charges and
expenses incurred in enforcing its rights under this Lease or in taking,
removing, holding, repairing, selling, leasing or otherwise disposing of the
Aircraft; then, (ii) to the extent not previously paid by Lessee, to pay Lessor
all sums due from Lessee under this Lease; then (iii) to reimburse to Lessee any
sums previously paid by Lessee as liquidated damages; and (iv) any surplus shall
be retained by Lessor. Lessee shall pay any deficiency in (i) and (ii)
immediately.
(d) The foregoing remedies are cumulative, and any or all thereof may
be exercised instead of or in addition to each other or any remedies at law, in
equity, or under statute Waiver of any Event of Default shall not be a waiver of
any other or subsequent Event of Default.
13. NET LEASE:
Lessee is unconditionally obligated to pay all rent and other amounts
due for the entire Term of this Lease no matter what happens, even if the
Aircraft is damaged or destroyed, if it is defective or if Lessee no longer can
use it. Lessee is not entitled to reduce or set-off against rent or other
amounts due to Lessor or to anyone to whom Lessor assigns this Lease whether
Lessee's claim arises out of this Lease, any statement by Lessor, Lessor's
liability or any manufacturers liability, strict liability, negligence or
otherwise.
14. INDEMNIFICATION:
(a) Lessee hereby agrees to indemnify Lessor, its agents, employees,
successors and assigns (on an after tax basis) from and against any and all
losses, damages, penalties, injuries, claims, actions and suits, including legal
expenses, of whatsoever kind and nature arising out of or relating to the
Aircraft or this Lease, except to the extent the losses, damages, penalties,
injuries, claims, actions, suits or expenses result from Lessor's gross
negligence or willful misconduct ("Claims"). This indemnity shall include, but
is not limited to, Lessor's strict liability in tort and Claims arising out of
(i) the selection, manufacture, purchase, acceptance or rejection of Aircraft,
the ownership of the Aircraft during the term of this Lease, and the delivery,
lease, possession, maintenance, uses, condition, return or operation of the
Aircraft (including, without limitation, latent and other defects, whether or
not discoverable by Lessor or Lessee and any claim for patent, trademark or
copyright infringement or environmental damage) or (ii) the condition of the
Aircraft sold or disposed of after use by Lessee, any sublessee or employees of
Lessee. Lessee shall, upon request, defend any actions based on, or arising out
of, any of the foregoing.
(b) Lessee hereby represents, warrants and covenants that (i) on the
Commencement Date, the Aircraft will qualify for all of the items of deduction
and credit specified in Annex B ("Tax Benefits") in the hands of Lessor, and
(ii) at no time during the Term of this Lease will Lessee take or omit to take,
nor will it permit any sublessee or assignee to take or omit to take, any action
(whether or not such act or omission is otherwise permitted by Lessor or by this
Lease), which will result in the disqualification of the Aircraft for, or
recapture of, all or any portion of such Tax Benefits.
(c) If as a result of a breach of any representation, warranty or
covenant of the Lessee contained in this Lease (i) tax counsel of Lessor shall
determine that Lessor is not entitled to claim on its Federal income tax return
all or any portion of the Tax Benefits with respect to the Aircraft, or (ii) any
Tax Benefit claimed on the Federal income tax return of Lessor is disallowed or
adjusted by the Internal Revenue Service, or (iii) any Tax Benefit is
recalculated or recaptured (any determination, disallowance, adjustment,
recalculation or recapture being a "Loss"), then Lessee shall pay to Lessor, as
an indemnity and as additional rent an amount that shall, in the reasonable
opinion of Lessor, cause Lessor's after-tax economic yields and cash flows to
equal the Net Economic Return that would have been realized by Lessor if such
Loss had not occurred. Such amount shall be payable upon demand accompanied by a
statement describing in reasonable detail such Loss and the computation of such
amount. The economic yields and cash flows shall be computed on the same
assumptions, including tax rates as were used by Lessor in originally evaluating
the transaction ("Net Economic Return"). If an adjustment has been made under
Section 3 then the Effective Rate used in the next preceding adjustment shall be
substituted.
(d) All references to Lessor in this Section 14 include Lessor and the
consolidated taxpayer group of which Lessor is a member. All of Lessor's rights,
privileges and indemnities contained in this Section 14 shall survive the
expiration or other termination of this Lease. The rights, privileges and
indemnities contained herein are expressly made for the benefit of, and shall be
enforceable by Lessor, its successors and assigns.
15. DISCLAIMER:
LESSEE ACKNOWLEDGES THAT IT HAS SELECTED THE AIRCRAFT WITHOUT ANY
ASSISTANCE FROM LESSOR, ITS AGENTS OR EMPLOYEES AND THAT LESSOR IS LEASING THE
AIRCRAFT IN AN "AS IS" CONDITION. LESSOR DOES NOT MAKE, HAS NOT MADE, NOR SHALL
BE DEEMED TO MAKE OR HAVE MADE, ANY WARRANTY OR REPRESENTATION, EITHER EXPRESS
OR IMPLIED, WRITTEN OR ORAL, WITH RESPECT TO THE AIRCRAFT LEASED UNDER THIS
LEASE OR ANY COMPONENT THEREOF, OR ANY ENGINE INSTALLED THEREON, INCLUDING,
WITHOUT LIMITATION, ANY WARRANTY AS TO CONDITION, AIRWORTHINESS, DESIGN,
COMPLIANCE WITH SPECIFICATIONS, QUALITY OF MATERIALS OR WORKMANSHIP,
MERCHANTABILITY, FITNESS FOR ANY PURPOSE, USE OR OPERATION, SAFETY, PATENT,
TRADEMARK OR COPYRIGHT INFRINGEMENT, OR TITLE. All such risks, as between Lessor
and Lessee, are to be borne by Lessee. Without limiting the foregoing, Lessor
shall have no responsibility or liability to Lessee or any other person with
respect to any of the following: (i) any liability, loss or damage caused or
alleged to be caused directly or indirectly by the Aircraft, any inadequacy
thereof, any deficiency or defect (latent or otherwise) of the Aircraft, or any
other circumstance in connection with the Aircraft; (ii) the use, operation or
performance of the Aircraft or any risks relating to it; (iii) any interruption
of service, loss of business or anticipated profits or consequential damages; or
(iv) the delivery, operation, servicing, maintenance, repair, improvement or
replacement of the Aircraft. If, and so long as, no default exists under this
Lease, Lessee shall be, and hereby is, authorized during the Term of this Lease
to assert and enforce, at Lessee's sole cost and expense, in the name of and for
the account of lessor and/or Lessee, as their interests may appear, whatever
claims and rights Lessor may have against any Supplier of the Aircraft.
16. REPRESENTATIONS AND WARRANTIES OF LESSEE:
Lessee hereby represents and warrants to Lessor that on the date of
this Lease and at all times during the Term of this Lease:
(a) Lessee has adequate power and capacity to enter into, and perform
under, this Lease and all related documents (together, the "Documents") and is
duly qualified to do business wherever necessary to carry on its present
business and operations, including the jurisdiction(s) where the Aircraft is or
is to have its primary hangar location.
(b) The Documents have been duly authorized, executed and delivered by
Lessee and constitute valid, legal and binding agreements, enforceable in
accordance with their terms, except to the extent that the enforcement of
remedies may be limited under applicable bankruptcy and insolvency laws.
(c) No approval, consent or withholding of objections is required from
any governmental authority or entity with aspect to the entry into or
performance by Lessee of the Documents except such as have already been
obtained.
(d) The entry into and Performance by Lessee of the Documents will not:
(i) violate any judgment, order, law or regulation applicable to Lessee or any
provision of Lessee's Certificate of Incorporation or By-Laws; or (ii) result in
any breach of, constitute a default under or result in the creation of any lien,
charge, security interest or other encumbrance upon any Aircraft pursuant to any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
instrument (other than this Lease) to which Lessee is a party.
(e) There are no suits or proceedings pending or threatened in court or
before any commission, board or other administrative agency against or affecting
Lessee, which will have a material adverse effect on the ability of Lessee to
fulfill its obligations under this Lease.
(f) Each financial statement delivered to Lessor has been prepared in
accordance with generally accepted accounting principles consistently applied,
and since the date of the most recent financial statement, there has been no
material adverse change.
(g) Lessee is and will be at all times validly existing and in good
standing under the laws of the State of its incorporation (specified in the
first sentence of this Lease) and Lessee is and will continue to be a "Citizen
of the United States" within the meaning of Section 40102(15) of the FAA. Lessee
shall not consolidate, reorganize or merge with any other corporation or entity
or sell, convey, transfer or lease all or substantially all of its property
during the Term of this Lease.
(h) The chief executive office or chief place of business (as either of
such terms is used in Article 9 of the Uniform Commercial Code) of Lessee is
located at the address set forth above, and Lessee agrees to give Lessor prior
written notice of any relocation of said chief executive office or chief place
of business from its present location.
(i) A copy of this Lease, and a current and valid AC Form 8050-1 will
be kept on the Aircraft at all times during the Term of this Lease.
(j) Lessee has selected the Aircraft manufacturer and vendor thereof,
and all maintenance facilities required hereby.
(k) Lessee shall maintain all logs, books and records (including any
computerized maintenance records) pertaining to the Aircraft and engines and
their maintenance during the Term in accordance with FAA rules and regulations.
(l) Lessee shall not operate the Aircraft under Part 135 of the Federal
Aviation Regulations without the prior written approval of Lessor.
(m) Lessee shall notify the local Flight Standards District Office of
the FAA forty-eight (48) hours prior to the first flight of the Aircraft under
this Lease.
(n) Throughout the Term of this Lease, Lessee will not use or operate
and will not permit the Aircraft to be used or operated "predominately" outside
the United States as that phrase is used in Section 168(g)(1)(A) of the Code.
17. EARLY TERMINATION:
(a) On or after the First Termination Date (specified in Annex B),
Lessee may, so long as no default exists under this Lease, terminate this Lease
as of a Rent Payment Date ("Termination Date"). Lessee must give Lessor at least
ninety (90) days prior written notice of the termination.
(b) Lessee shall, and Lessor may, solicit cash bids for the Aircraft on
an AS IS, WHERE IS basis without recourse to or warranty from Lessor, express or
implied ("AS IS BASIS"). Prior to the Termination Date, Lessee shall, (i)
certify to Lessor any bids received by Lessee; and (ii) pay to Lessor, (a) the
Termination Value (calculated as of the Termination Date) for the Aircraft; and
(b) all Rent and other sums due and unpaid as of the Termination Date. Neither
Lessee nor its agents shall be permitted to bid.
(c) If all amounts due hereunder have been paid on the Termination
Date, Lessor shall (i) sell the Aircraft on an AS IS BASIS for cash to the
highest bidder; and (ii) refund the proceeds of such sale (net of any related
expenses) to Lessee up to the amount of the Termination Value paid by Lessee. If
such sale is not consummated, no termination shall occur and Lessor shall refund
the Termination Value (less any expenses incurred by Lessor) to Lessee.
(d) Notwithstanding the foregoing, Lessor may elect by written notice,
at any time prior to the Termination Date, not to sell the Aircraft. In that
event, on the Termination Date Lessee shall: (i) return the Aircraft (in
accordance with Section 11); and (ii) pay to Lessor all amounts required under
Section 17(b) less the amount of the highest bid certified by Lessee to Lessor.
18. EARLY PURCHASE OPTION:
(a) On the Early Purchase Option Date (specified in Annex B), Lessee
may, so long as no default exists hereunder and this Lease has not been earlier
terminated, purchase the Aircraft on an AS IS BASIS for cash equal to the Early
Purchase Option Price (specified on Annex B), plus all applicable sales taxes.
Lessee must give Lessor at least thirty (30) days, but not more then ninety (90)
days, prior written notice of the purchase. Lessor and Lessee agree that the
Option Price is a reasonable prediction of the price that a willing buyer (who
is neither a lessee in possession or a used aircraft dealer) would pay for the
Aircraft on the Early Purchase Option Date in an arm's-length transaction to a
willing seller under no compulsion to sell.
(b) If Lessee has elected to purchase the Aircraft, then on the Early
Purchase Option Date Lessee shall pay to Lessor the Early Purchase Option Price
(plus all applicable sales taxes) together with any rent and other sums due and
unpaid on the Early Purchase Option Date.
19. END OF LEASE PURCHASE OPTION:
(a) On the Expiration Date (specified in Annex B), Lessee may, so long
as no default exists hereunder and this Lease has not been earlier terminated,
purchase the Aircraft on an AS IS BASIS for cash equal to its then Fair Market
Value (plus all applicable sales taxes). Lessee must give Lessor at least ninety
(90) days, but not more than one hundred eighty (180) days, prior written notice
of its intent to purchase.
(b) "Fair Market Value" shall mean the price which a willing buyer (who
is neither a lessee in possession nor a used equipment dealer) would pay for the
Aircraft in an arm's-length transaction to a willing seller under no compulsion
to sell. In determining the Fair Market Value; (i) the Aircraft shall be assumed
to be in the condition in which it is required to be maintained and returned
under this Lease, (ii) any installed additions to the Aircraft shall be valued
on an installed basis; and (iii) costs of removal of the Aircraft from the
current location shall not be a deduction from the value of the Aircraft. If
Lessor and Lessee are unable to agree on the Fair Market Value at least sixty
(60) days before Lease expiration, Lessor shall appoint an independent appraiser
(reasonably acceptable to Lessee) to determine Fair Market Value. The
independent appraisers determination shall be final, binding and conclusive.
Lessee shall bear all costs associated with any such appraisal.
(c) Lessee shall be deemed to have waived this purchase option unless
it provides Lessor with written notice of its irrevocable election to exercise
the option within fifteen (15) days after the Fair Market Value is told to
Lessee.
20. MISCELLANEOUS:
(a) LESSEE AND LESSOR HEREBY UNCONDITIONALLY WAIVE THEIR RIGHTS TO A
JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
LEASE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS BETWEEN LESSEE AND LESSOR
RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION OR ANY RELATED TRANSACTIONS,
AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED BETWEEN LESSEE AND LESSOR. THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT. THIS WAIVER IS IRREVOCABLE. THIS WAIVER MAY NOT
BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS LEASE, ANY
RELATED DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THIS
TRANSACTION OR ANY RELATED TRANSACTION. THIS LEASE MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
(b) The Aircraft shall remain Lessor's property unless Lessee purchases
the Aircraft from Lessor, and until such time Lessee shall only have the right
to use the Aircraft as a lessee. Any cancellation or termination by Lessor of
this Lease, pursuant to the provisions of this Lease, shall not release Lessee
from any then outstanding obligations to Lessor hereunder.
(c) Time is of the essence of this Lease. Lessee agrees, upon Lessor's
request, to execute any instrument necessary or expedient for filing, recording
or perfecting the interest of Lessor. All notices required to be given hereunder
shall be deemed adequately given if delivered in hand or sent by registered or
certified mail to the addressee at its address stated herein, or at such other
place as such addressee may have designated in writing. This Lease and any
Annexes hereto constitute the entire agreement of the parties with respect to
the subject matter hereof, and all Annexes referenced herein are incorporated
herein by reference. NO VARIATION OR MODIFICATION OF THIS LEASE OR ANY WAIVER OF
ANY OF ITS PROVISIONS OR CONDITIONS, SHALL BE VALID UNLESS IN WRITING AND SIGNED
BY AN AUTHORIZED REPRESENTATIVE OF EACH PARTY TO THIS LEASE.
(d) If Lessee does not comply with any provision of this Agreement,
Lessor shall have the right, but shall not be obligated, to effect such
compliance, in whole or in part. All reasonable amounts spent and obligations
incurred or assumed by Lessor in effecting such compliance shall constitute
additional Rent due to Lessor. Lessee shall pay the additional Rent within five
days after the date Lessor sends notice to Lessee requesting payment. Lessors
effecting such compliance shall not be a waiver of any Event of Default.
(e) Any Rent or other amount not paid to Lessor when due shall bear
interest from the due date until paid, at the lesser of eighteen percent (18%)
per annum or the maximum rate allowed by law. Any provisions in this Lease which
are in conflict with any statute, law or applicable rule shall be deemed
omitted, modified or altered to conform thereto.
(f) THIS LEASE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF CONNECTICUT (WITHOUT REGARD TO THE CONFLICT OF
LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE, REGARDLESS OF THE LOCATION OF THE AIRCRAFT.
21. TRUTH-IN-LEASING:
(a) LESSEE HAS REVIEWED THE AIRCRAFT'S MAINTENANCE AND OPERATING LOGS
SINCE ITS DATE OF MANUFACTURE AND HAS FOUND THAT THE AIRCRAFT HAS BEEN
MAINTAINED AND INSPECTED UNDER PART 91 OF THE FEDERAL AVIATION REGULATIONS.
LESSEE CERTIFIES THAT THE AIRCRAFT PRESENTLY COMPLIES WITH THE APPLICABLE
MAINTENANCE AND INSPECTION REQUIREMENTS OF PART 91 OF THE FEDERAL AVIATION
REGULATIONS.
(b) LESSEE CERTIFIES THAT LESSEE, AND NOT LESSOR, IS RESPONSIBLE FOR
OPERATIONAL CONTROL OF THE AIRCRAFT UNDER THIS LEASE DURING THE TERM HEREOF.
LESSEE FURTHER CERTIFIES THAT LESSEE UNDERSTANDS ITS RESPONSIBILITY FOR
COMPLIANCE WITH APPLICABLE FEDERAL AVIATION REGULATIONS.
(c) LESSEE CERTIFIES THAT THE AIRCRAFT WILL BE MAINTAINED AND INSPECTED
UNDER PART 91 OF THE FEDERAL AVIATION REGULATIONS FOR OPERATIONS TO BE CONDUCTED
UNDER THIS LEASE. LESSEE UNDERSTANDS THAT AN EXPLANATION OF FACTORS BEARING ON
OPERATIONAL CONTROL AND PERTINENT FEDERAL AVIATION REGULATIONS CAN BE OBTAINED
FROM THE NEAREST FAA FLIGHT STANDARDS DISTRICT OFFICE, GENERAL AVIATION DISTRICT
OFFICE, OR AIR CARRIER DISTRICT OFFICE.
IN WITNESS WHEREOF, Lessee and Lessor have caused this Lease to be
executed by their duly authorized representatives as of the date first above
written.
LESSOR: LESSEE:
GENERAL ELECTRIC CAPITAL CORPORATION SMART CHOICE AUTOMOTIVE GROUP, INC.
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxxx X. Xxxx
------------------------------------ ------------------------------
Xxxxx Xxxxx Xxxxxx X. Xxxx
Regional Risk Manager Executive Vice President/Chief
Financial Officer
ANNEX A
DESCRIPTION OF AIRCRAFT, LESSOR'S COST, AND AIRCRAFT MARKINGS
I. Description Cost: $2,160,000.00
RAYTHEON AIRCRAFT CO., Model C90A Aircraft which consists of the
following components:
(a) Airframe bearing FAA Registration Xxxx N1107W and Manufacturer's
Serial No. LJ1477;
(b) two, (2) Xxxxx & Whitney PT6A-42 engines bearing Manufacturer's Serial Nos.
Left-PCE-PE-0067 and Right-PCE-PE-0071 respectively (each of which has 750 or
more rated takeoff horsepower or the equivalent of such horsepower);
(c) two, (2) XxXxxxxx, 4HFR34C768-C propellers bearing, respectively bearing,
Manufacturer's Serial Nos. Left-970225 and Right-970575, each being rated as
follows: __________________________
(d) Standard accessories and optional equipment and such other items fitted or
installed on the Aircraft and set forth hereinafter:
MORE FULLY DESCRIBED ON EXHIBIT A ATTACHED HERETO AND MADE A PART HEREOF.
(e) Those items of Lessee Furnished Equipment described in a xxxx of sale or
bills of sale thereof (copies of which arc appended hereto), delivered by Lessee
to Lessor which constitute appliances and equipment which will be installed on
the Aircraft;
(f) Sales Tax .00
(g) Other .00
Aircraft more fully described on Exhibit A to Aircraft Least attached hereto and
made a part hereof
Capitalized Lessor's Cost $2,160,000.00
II. Aircraft Markings (referenced in the MAINTENANCE Section of Lease)
a) Four-by-six inch plaque to be maintained in cockpit and affixed in
conspicuous position stating: General Electric Capital Corporation Owner and
Lessor. Smart Choice Automotive Group, Inc. Lessee under a certain Lease dated
as of _______________ has operational control of this Aircraft.
b) Similar markings shall be permanently affixed to each engine.
Initials:
Lessee:__________________________ Lessor:__________________________
ANNEX B
DATED THIS ____________________
TO AIRCRAFT LEASE AGREEMENT
DATED AS OF ___________________
Lessor & Mailing Address: Leesee & Mailing Address:
General Electric Capital Corporation Smart Choice Automotive Group, Inc.
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000 5200 X. Xxxxxxxxxx Xxxxxx
X.X. Xxx 0000 Xxxxxxxxxx, XX 00000
Xxxxxxxxxx, XX 00000-0000
Capitalized terms not defined herein shall have the meanings assigned to them in
the Aircraft Lease Agreement identified above.
A. AIRCRAFT.
Pursuant to the terms of the Lease, Lessor agrees to acquire and lease
to Lessee the Aircraft described on Annex A to the Lease.
B. FINANCIAL TERMS.
1. Advance Rent (if any): (a) Amount: $ Not Applicable.
(b) Due Date: Not Applicable.
2. Capitalized Lessor's Cost: $2,160,000.00.
3. Basic Term Commencement Date: December 1, 1998.
4. Basic Term: 120 months.
5. First Basic Term Rent Date: December 1, 1998.
6. Basic Term Rent Dates: December 1, 1998.
7. First Termination Date: (36) months after the
Basic Term Commencement Date.
8. Last Basic Term Rent Dates November 30, 2008.
9. Last Delivery Date: November 30, 1998.
10. Primary Hangar Location: Discovery Aviation,
0000 Xxxxxxxxxx Xxx.,
Xxxxxxxxxx, XX 00000.
11. Supplier: Raytheon Aircraft Company.
12. Lessee Federal Tax ID No.: 00-0000000.
13. Early Purchase Option: Option Date: N /A.
Option Price: $ N/A.
14. Expiration Date: November 30, 2008.
15. Daily Lease Rate Factor: .000324.
16. Basic Term Lease Rate Factor:
Factor Rental No.
0.972222 36
0.679569 94
C. TAX BENEFITS.
Depreciation Deductions:
a. Depreciation Method: 200% declining balance method, switching to
straight line method for the 1st taxable year for which using the
straight line method with respect to the adjusted basis as of the
beginning of such year will yield a larger allowance.
b. Recovery Period: Five (5).
c. Basis: 100% of Capitalized Lessor's Cost.
D. TERM AND RENT.
1. Interim Rent. For the period from and including the Commencement
Date to the Basic Term Commencement Date ("Interim Period"), Lessee shall pay as
Rent ("Interim Rent") for each unit of Aircraft, the product of the Daily Lease
Rate Factor times the Capitalized Lessees Cost of such unit times the number of
days in the Interim Period. Interim Rent shall be due on November 30, 1998.
2. Basic Term Rent. Commencing on December 1, 1998 and on the same day
of each month thereafter (each, a "Rent Payment Date") during the Basic Term,
Lessee shall pay as Rent ("Basic Term Rent") the product of the Basic Term Lease
Rate Factor times the Capitalized Lessor's Cost of the Aircraft on this Annex B.
E. INSURANCE.
1. Public Liability: $50,000,000.00 total liability per occurrence.
2. Casualty and Property Damage: An amount equal to the higher of the
Stipulated Loss Value or the full replacement cost of the Aircraft.
