1
EXHIBIT 10.12
Dated 17 July 2000
AERFI GROUP PLC
SKYSCAPE LIMITED
AERFI INC.
INDIGO AVIATION AB
KOMMANDITBOLAGET FLYGPLANET XII
and
AERCO LIMITED
AERCO USA INC.
SHARE PURCHASE AGREEMENT
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Solicitors
▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
International Financial Services Centre
Dublin 1
2
CONTENTS
1. Interpretation........................................................3
2. Purchase and Sale....................................................14
3. Closing..............................................................17
4. Calculation Date Payments............................................20
5. Additional AerFi obligations with respect to
Remaining Aircraft...................................................21
6. Substitution and Termination.........................................21
7. Non Delivery Events..................................................22
8. Representations and warranties of Sellers............................23
9. Indemnities..........................................................24
10. Limitations on Warranties and Indemnities............................27
11. Representations and Warranties of Purchasers.........................29
12. Additional Covenants and Agreements..................................29
13. Conditions...........................................................30
14. Miscellaneous........................................................34
Exhibit A - Purchase Price Adjustments......................................39
Exhibit B - Mortgage of Shares.............................................42
Exhibit C - Mortgage of Membership Interests................................61
SCHEDULE 1 - Details relating to the Shares.................................75
SCHEDULE 2 - Further Information Concerning the Companies...................77
SCHEDULE 4 - Purchasers' Representations and Warranties....................115
SCHEDULE 5 - Deed of Tax Indemnity.........................................117
SCHEDULE 6A - Form of Solvency Certificate (Irish companies)...............127
SCHEDULE 6B - Form of Solvency Certificate (US companies)..................127
SCHEDULE 6C - Form of Solvency Certificate (Baltic II and Baltic III)......130
SCHEDULE 6D - Form of Solvency Certificate (Swedish companies).............131
SCHEDULE 7 - Particulars of the Aircraft...................................132
SCHEDULE 8 - Audited Financial Statements..................................137
SCHEDULE 9 - Pro-Forma Balance Sheets......................................138
2
3
THIS AGREEMENT is made on 17 July 2000 BETWEEN:--
(1) AERFI GROUP PLC ("AERFI"), a company incorporated in Ireland and having
its registered office at Aviation House, Shannon, Co Clare, Ireland,
SKYSCAPE LIMITED ("SKYSCAPE"), a company incorporated in Ireland and
having its registered office at Aviation House, Shannon, Co ▇▇▇▇▇,
Ireland, AERFI INC. a corporation incorporated in the State of Delaware
and having its principal place of business at ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("AERFI INC."), INDIGO AVIATION AB
("INDIGO AVIATION"), a company incorporated under the laws of Sweden
and having its principal place of business at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇,
▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ and KOMMANDITBOLAGET FLYGPLANET XII ("KB
FLYGPLANET"), a limited partnership established under the laws of
Sweden and having its principal place of business at ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ (each a "SELLER" and together the
"SELLERS"); and
(2) AERCO LIMITED ("AERCO"), a company incorporated in Jersey and having
its registered office at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇
▇▇▇, Channel Islands and AERCO USA INC. ("AERCO USA"), a corporation
incorporated in the State of Delaware and having its principal place of
business at Nationwide Information Services Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (each a "PURCHASER" and together the "PURCHASERS").
RECITALS:
(A) Each of the companies numbered 1 to 18 in Schedule 2 (each a "COMPANY"
and together the "COMPANIES") is a wholly-owned direct or indirect
subsidiary of AerFi.
(B) The Companies own or intend to acquire ownership of the Aircraft (as
defined below) and the related Leases (as defined below) referred to in
Schedule 7. The Aircraft (as defined below) and related Leases (as
defined below) to be acquired by each Company shall be determined in
accordance with the terms of this Agreement.
(C) The AerCo Group has agreed to acquire from the Seller Group the
Aircraft (as defined below) and the benefit of the related Leases (as
defined below) by purchasing the issued share capital or other
outstanding membership interest in each of the Companies on the terms
and conditions set out in this Agreement, including the provisions
contained in Clause 4.
NOW IT IS AGREED as follows:
1. INTERPRETATION
1.1 DEFINITIONS: In this Agreement unless the context requires otherwise:
"ACTION" means any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority;
"AERCO GROUP" means AerCo, AerCo USA, each Company (once it has been
acquired by AerCo or AerCo USA pursuant to this Agreement), and any
other companies which are, or which on or after the date of this
Agreement become, direct or indirect subsidiaries of AerCo;
3
4
"AERFI POL" means AerFi POL Inc., a Delaware corporation, all the
issued stock in which is held by AerFi Inc. as set out in Schedule 2;
"AERFI POL STOCK" means all of the issued and outstanding common stock
in AerFi POL;
"AFFILIATE" means, with respect to any person, any body corporate which
is (a) a subsidiary or a holding company of such person or (b) a
subsidiary of any body corporate of which that person is also a
subsidiary;
"AIRCRAFT" means the aircraft listed or referred to in Schedule 7 and
any Substitute Aircraft agreed to by the AerCo Group in accordance with
Clause 6 of this Agreement, together with, unless otherwise specified,
all Engines and Parts related thereto;
"AIRCRAFT DOCUMENTS" means all records, logs, technical data and
manuals relating to the maintenance and operation of the Aircraft;
"AIRCRAFT PURCHASE ACCOUNT" shall have the meaning given such term in
the Notes Indenture;
"AIRCRAFT PURCHASE AGREEMENTS" means the
Aircraft Purchase Agreements relating to the Aircraft:-
(i) dated 14 July, 2000 between Indigo International AB as seller
and Gustav Leasing I Limited as purchaser in respect of the
Aircraft with manufacturer's serial number 24651;
(ii) dated 14 July 2000 between Indigo Atlantic AB as seller and
Gustav Leasing V Limited as purchaser in respect of the
Aircraft with manufacturer's serial number 411;
together with any other agreements entered into by any of the Companies
after the date hereof for the acquisition of one or more Aircraft;
"APA INTEREST AMOUNT" means, for any Remaining Aircraft, the actual
amount of interest received on all funds in the Aircraft Purchase
Account allocable to such Remaining Aircraft;
"APPRAISERS" means Aircraft Information Services, Inc, Airclaims
Limited and BK Associates, Inc., or, in the case of a Substitute
Aircraft, any three or more Appraisers (as defined in the Notes
Indenture);
"ASSUMED D AND E NOTE INTEREST" means, for any Remaining Aircraft with
respect to any Calculation Date, an amount equal to the interest, if
any, that would actually have been payable on the Payment Date next
succeeding such Calculation Date, to the holders of the D Notes and the
E Notes allocable to such Remaining Aircraft as of such Calculation
Date under the priority of payments and pursuant to the terms set out
in the D Notes, the E Notes and the Notes Indenture had the principal
amount of such D Notes and E Notes allocable to
4
5
such Aircraft been outstanding since the immediately preceding
Calculation Date;
"BALTIC II" means Baltic AirLease II LLC, a corporation formed and
organised in the Isle of Man, the membership interests in which are
held by Indigo Aviation and KB Flygplanet as set out in Schedule 2;
"BALTIC III" means Baltic AirLease III LLC, a corporation formed and
organised in the Isle of Man, the membership interests in which are
held by Indigo Aviation and KB Flygplanet as set out in Schedule 2;
"BASE VALUE" means, at any time, the value of any Aircraft on the basis
of an open, unrestricted, and stable market environment with a
reasonable balance of supply and demand of other aircraft and with full
consideration of such Aircraft's "highest and best use" and presuming
an arm's length, cash transaction between willing, able and
knowledgeable parties, acting prudently, with an absence of duress and
with a reasonable period of time available for marketing such Aircraft
adjusted to account for the maintenance status of such Aircraft (with
certain assumptions as to use since the last reported status, as set
out, as regards any appraisal of base value, in such appraisal);
"BUSINESS DAY" shall have the meaning given to such term in the Notes
Indenture;
"CALCULATION DATE" shall have the meaning given to that term
in the Notes Indenture;
"CLOSING" means, in relation to a Company, the closing of the sale and
purchase of the Shares in that Company in accordance with Clause 3
hereof;
"CLOSING DATE" means, in relation to a Company, the date upon which the
Closing of the sale and purchase of the Shares in that Company takes
place;
"COMPANY DEBT" means, in relation to a Company, the outstanding
principal balance, as shown on the Reference Balance Sheet, of (i) any
indebtedness owed by that Company to AerFi or any of its Affiliates in
the ordinary course of business and (ii) any indebtedness owed by that
Company to any third party creditor incurred for the purpose of
purchasing an Aircraft, and as certified by AerFi to AerCo, provided,
that in no case shall the total Company Debt of any Company exceed the
Initial Appraised Value of the Aircraft owned by such Company on the
relevant Closing Date;
"CONCENTRATION DEFAULT" shall have the meaning given to that term in
the Notes Indenture;
"D NOTES" means the Subclass D-2 Notes to be issued by AerCo under the
Notes Indenture;
"DEED OF TAX INDEMNITY" means a deed in the form set out in Schedule 5;
"DELIVERED AIRCRAFT" means any Aircraft owned by a Delivered Company;
5
6
"DELIVERED COMPANY" means each Company, the Shares of which have been
transferred on a Closing Date by the relevant Seller(s) to the relevant
Purchaser;
"DELIVERY NOTICE" has the meaning given to such term in Clause
3(a)(iii) hereof;
"DIRECTORS" and "SECRETARY", in relation to a Company, means the
persons described in Schedule 2 as directors and secretary thereof
respectively;
"DISCLOSURE LETTER" means the disclosure letter of even date herewith
from AerFi to the Purchasers, a copy of which is annexed hereto,
together with any further disclosure letter required under Clause 12.1
in relation to a Company delivered by AerFi to the Purchasers on or
before the Closing of the sale of the Shares in that Company;
"DOLLARS" or "$" or "US$" means the lawful currency of the United
States of America;
"END PERIOD" has the meaning given such term in Clause 4 hereof;
"E NOTES" means the Subclass E-2 Notes to be issued by AerCo under the
Notes Indenture;
"ENGINE" means each engine listed or referred to in Schedule 7 and, in
the case of a Substitute Aircraft, each engine owned by the relevant
Company and attached to that Substitute Aircraft or, where any such
engine has been replaced under the terms of the relevant Lease, and
title to the replacement engine has passed to the relevant Company,
such replacement engine, and including any and all Parts incorporated
in, installed on or attached to such engine or replacement engine;
"GOVERNMENTAL AUTHORITY" means any governmental, regulatory or
administrative authority, agency or commission or any court, tribunal,
or judicial or arbitral body;
"GOVERNMENTAL ORDER" means any order, writ, judgement, injunction,
decree, stipulation, determination or award entered by or with any
Governmental Authority;
"HOLDBACK" mean, in respect of each of the first fifteen Aircraft to be
acquired by the Purchasers by the purchase of the Shares in the
Companies contemplated by this Agreement, the amount by which the
amount otherwise payable from the Aircraft Purchase Account to or at
the direction of the relevant Seller(s) is reduced pursuant to the
first paragraph of Exhibit A hereto;
"INITIAL APPRAISED VALUE" means, in respect of any Aircraft other than
a Substitute Aircraft, the average of the aggregate Base Values for
that Aircraft as at 30 April, 2000 obtained from the Appraisers and set
out opposite the description of that Aircraft in Schedule 7 and, in
respect of any Substitute Aircraft, the average of the aggregate Base
Values for that Aircraft obtained pursuant to Clause 6.1 hereof;
"IRISH COMPANIES" means the Companies other than Baltic II, Baltic III,
AerFi POL and AerFi Sverige Leasing AB;
6
7
"LEASE" means, for each Aircraft other than a Substitute Aircraft, the
aircraft lease agreement (including any sublease) relating to it
described or referred to in Schedule 7, and, with respect to a
Substitute Aircraft, each aircraft lease agreement, conditional sale
agreement, hire purchase agreement or other similar arrangement with
respect to such Substitute Aircraft on the relevant Closing Date of the
sale of the Shares in the Company owning such Substitute Aircraft;
"LEASE EXPENSES" means, with respect to the Lease relating to a
Remaining Aircraft, all costs and expenses relating to the management
of such Lease actually incurred by the Seller Group from and including
the Offering Closing Date to, but excluding, the Closing Date on which
the Shares of the relevant Remaining Company are transferred by the
relevant Seller(s) to the relevant Purchaser but excluding Required
Maintenance Expenses;
"LESSEE" means a lessee under a Lease;
"LESSOR" means the lessor under a Lease;
"LIABILITIES" means any and all debts, liabilities and obligations,
whether accrued or fixed, absolute or contingent, matured or unmatured
or determined or determinable, including, without limitation, those
arising under any law (including, without limitation, any environmental
law), Action or Governmental Order and those arising under any
contract, agreement, arrangement, commitment or undertaking;
"LIEN" means any security interest, pledge, mortgage, lien (including,
without limitation, environmental and tax liens), charge, encumbrance,
adverse claim, preferential arrangement or restriction of any kind,
including, in the case of shares or membership interests, without
limitation, any restriction on the use, voting, transfer, receipt of
income or other exercise of any attributes of ownership of such shares
or membership interests;
"MAINTENANCE REIMBURSEMENT AMOUNT" means, with respect to the Lease
relating to a Remaining Aircraft, the total amount of Maintenance Rent
paid under such Lease by the Lessee thereunder from and including the
Offering Closing Date to, but excluding, the Closing Date on which the
Shares of the relevant Remaining Company are transferred by the
relevant Seller(s) to the relevant Purchaser;
"MAINTENANCE RENT" means, with respect to the Lease relating to a
Remaining Aircraft, amounts paid by the Lessee thereunder pursuant to
the terms thereof, whether as supplemental rent or otherwise, for the
purpose of performing maintenance on such Remaining Aircraft;
"MATERIAL ADVERSE EFFECT" means any material adverse effect on the
business condition (financial or otherwise), operations, performance or
properties of the relevant Company or Companies and its/their
subsidiaries, taken as a whole;
7
8
"MINISTER" means the Minister for the time being for Enterprise, Trade
and Employment of Ireland;
"NET ACCRUED EXPENSES" means, with respect to any Remaining Aircraft,
the total expense paid by the Seller Group with respect to Lease
Expenses for that Remaining Aircraft from (and including) the Offering
Closing Date to (but excluding) the earlier of (a) the Closing Date on
which the Shares in the Remaining Company owning such Remaining
Aircraft are transferred by the relevant Seller(s) to the relevant
Purchaser and (b) the Non-Delivery Date;
"NET MAINTENANCE AMOUNT" means, with respect to a Remaining Aircraft,
the Maintenance Reimbursement Amount relating to that Remaining
Aircraft less the Required Maintenance Expenses relating to that
Remaining Aircraft;
"NON-DELIVERY DATE" means the date of occurrence of a Non-Delivery
Event;
"NON-DELIVERY EVENT" shall have the meaning set forth in Clause 7.1
hereof;
"NON-US COMPANIES" means the Companies other than AerFi POL;
"NOTE PURCHASE AGREEMENT" means the Purchase Agreement dated 12 July
2000 between AerCo, AerFi, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
and ▇▇▇▇▇▇ Brothers Inc.;
"NOTES INDENTURE" means the Indenture dated as of 15 July 1998 made
between AerCo as issuer and Bankers Trust Company as trustee as
supplemented by that certain Indenture Supplement No. 1, to be dated as
of 17 July 2000 (the "INDENTURE SUPPLEMENT");
"NOVATION AGREEMENTS" means the Novation Agreements to which one or
more of the Companies is or will be a party included or referred to in
the descriptions of Leases in Schedule 7 together with any other
agreements entered into by any of the Companies for the purpose of
novating to that Company the rights, benefits and obligations of the
Lessor under a Lease;
"OFFERING CLOSING DATE" means 17 July 2000;
"OFFERING MEMORANDUM" means the Offering Memorandum issued on 12 July
2000 in respect of a debt issue by AerCo (the "OFFERING");
"OTHER TRANSACTION DOCUMENTS" means the Offering Memorandum, the
Aircraft Purchase Agreements, the Deed of Tax Indemnity, the Novation
Agreements and the Notes Indenture;
"PART" means any part, component, appliance, accessory, instrument or
other item of equipment (other than any of the Engines) incorporated
in, installed on or attached to any Aircraft or Engine;
"PAYMENT DATE" shall have the meaning given such term in the Notes
Indenture;
"PERMITTED LIENS", in respect of any Aircraft, means:-
8
9
(a) any lien for taxes, assessments and governmental charges or
levies which are not yet due and payable or which are being
contested in good faith by appropriate proceedings (provided
that if the member of the Seller Group who is the owner or
lessor of the relevant Aircraft has become aware of any such
lien, such lien shall not be a "PERMITTED LIEN" hereunder
unless such owner or lessor is using commercially reasonable
efforts to have such lien lifted);
(b) any liens of a repairer, carrier or hangar keeper arising in
the ordinary course of business by operation of law, any other
similar lien or any engine or parts pooling arrangements in
the ordinary course of business;
(c) any "PERMITTED LIEN" (or other similar term) as defined under
the relevant Lease (other than liens created by the relevant
Lessor);
(d) any liens created by or through or arising from debt or
liabilities or any act or omission of any Lessee, in each case
in contravention of the relevant Lease (whether or not such
Lease has been terminated) or without the consent of the
relevant Lessor (provided that if such Lessor has become aware
of any such lien, such lien shall not be a "PERMITTED LIEN"
hereunder unless such Lessor is using commercially reasonable
efforts to have any such liens lifted);
(e) any head lease, lease, conditional sale agreement or option
permitted under the Leases or purchase options relating to the
Aircraft which would constitute a "PERMITTED ENCUMBRANCE" as
defined in Section 5.02(b) of the Notes Indenture;
(f) any liens for air navigation authority, airport tending, gate
or handling (or similar) charges or levies;
(g) any lien which would not adversely affect the owner's rights
(provided that, taking all the Aircraft (for purposes of this
definition only, as such term is used in the Notes Indenture)
as a whole, liens which are permitted under this paragraph (g)
but do not otherwise qualify as "PERMITTED LIENS" shall not
exceed 1% of the aggregate Initial Appraised Values of the
Portfolio (as defined in the Notes Indenture), or, if greater,
$250,000 per Aircraft);
"PRO-FORMA BALANCE SHEET" means, in relation to a Company, the
pro-forma balance sheet of such Company prepared as of 30 June 2000 and
attached hereto as Schedule 9;
"PURCHASER INDEMNITY" means, the indemnity set out in Clause 9.1
hereof;
"PURCHASER WARRANTIES" means, the warranties and undertakings of the
Purchasers contained in Schedule 4;
"REBATE" means, in respect of each Aircraft to be acquired by the
Purchasers by the purchase of the Shares in the Companies contemplated
by this Agreement after acquisition by the Purchasers of the first
fifteen Aircraft, the amount by which the amount otherwise payable from
the Aircraft Purchase Account to or for the account
9
10
of the relevant Seller(s) is increased pursuant to the second and third
paragraphs of Exhibit A hereto;
"REFERENCE BALANCE SHEET" means, in relation to a Company, the balance
sheet of the Company prepared as at the Reference Balance Sheet Date
showing the financial position of the Company as it would have been if
the transactions contemplated by the Aircraft Purchase Agreements and
the Novation Agreements to which it is or is to be a party had been
completed as at that date;
"REFERENCE BALANCE SHEET DATE" means, in relation to a Company the
Shares in which are to be transferred on the Offering Closing Date, 30
June 2000 or, in the case of a Company the Shares in which are to be
transferred after the Offering Closing Date, such later date, if any,
to which its Reference Balance Sheet is prepared for the purpose of the
Closing of the sale of the Shares in that Company, which shall be a
month-end date no more than 33 calendar days prior to the relevant
Closing Date;
"REIMBURSEMENT DATE" has the meaning set forth in Clause 4 hereof;
"RELATED DOCUMENTS" has the meaning attributed to it in the Notes
Indenture;
"REMAINING AIRCRAFT" means, at any time, the Aircraft which are owned
or are to be acquired by a Remaining Company (including any Substitute
Aircraft) but does not include any Aircraft with respect to which AerFi
has delivered a Termination Notice;
"REMAINING COMPANY" means, at any time, each Company which owns or is
to acquire any of the Aircraft the Shares in which at that time have
not been (a) transferred from the relevant Seller(s) to the relevant
Purchaser or (b) the subject of a Termination Notice;
"RENT PAYMENT" means, in relation to each Remaining Aircraft, an amount
equal to the total gross amounts paid by the Lessee under the Lease
relating to such Remaining Aircraft (other than any Lease between
members of the Seller Group) less the amount of Maintenance Rent paid
by such Lessee under such Lease, provided that upon acceptance by AerCo
of a Substitute Aircraft for such Remaining Aircraft, the Rent Payment
shall refer to the total gross amounts paid by the Lessee under the
Lease, if any, relating to such Substitute Aircraft less the amount of
Maintenance Rent paid by such Lessee under such Lease;
"RENT PAYMENT REIMBURSEMENT AMOUNT" means the sum of the APA Interest
Amount received during the relevant Rent Transfer Period and the
Assumed D and E Note Interest;
"RENT TRANSFER PERIOD" means, for each Remaining Aircraft, the period
beginning on (and including) the Offering Closing Date and ending on
(but excluding) the first Calculation Date thereafter and each
successive period beginning on (and including) a Calculation Date and
ending on (but excluding) the next succeeding Calculation Date;
10
11
"REQUIRED MAINTENANCE EXPENSES" means, with respect to a Remaining
Aircraft, maintenance expenses actually incurred by the Seller Group
and not reimbursed by the Lessee of such Remaining Aircraft or covered
by the Maintenance Rent paid to the Seller Group by such Lessee from
(and including) the Offering Closing Date to (but excluding) the
Closing Date on which the Shares of the relevant Remaining Company are
transferred by the relevant Seller(s) to the relevant Purchaser;
"SECURITY DEPOSIT" means, in relation to a Lease, such part of any
amounts (whether described as commitment fee or security deposit) paid
by the Lessee to the Lessor to secure the obligations of the Lessee to
the Lessor under the Lease in respect of which, at the Reference
Balance Sheet Date, the relevant Lessee would or might have a claim to
repayment;
"SELLERS' ACCOUNTANTS" means KPMG, Dublin, independent accountants of
the Sellers;
"SELLER GROUP" means AerFi and its consolidated subsidiaries but
excluding (i) each Company the Shares in which have been transferred to
a Purchaser and (ii) the Purchasers and any other companies which are
on, or after the Offering Closing Date become, subsidiaries of the
Purchasers;
"SELLER INDEMNITY" means the indemnity set out in Clause 9.2 hereof;
"SERVICING AGREEMENT" means the Servicing Agreement dated as of 17 July
2000 between, amongst others, AerFi, AerFi Administrative Services
Limited, AerFi Cash Manager II Limited and AerCo or any replacement
servicing agreement;
"SHARES" means:-
(a) in the case of the Irish Companies, the issued and outstanding
shares in the capital of the Irish Companies, details of which
are set out in Schedule 2;
(b) in the case of Baltic II and Baltic III, the outstanding
membership interests in such Companies, details of which are
set out in Schedule 2;
(c) in the case of AerFi POL, all of the issued and outstanding
shares of common stock in AerFi POL, details of which are set
out in Schedule 2; and
(d) in the case of AerFi Sverige Leasing AB, the issued and
outstanding shares in AerFi Sverige Leasing AB, details of
which are set out in Schedule 2;
"SOLVENT" means, in respect of any company at any date and on the
assumption that the transactions contemplated by this Agreement, the
Other Transaction Documents and the Related Documents have been
completed or will be completed (as the case may be) on the terms and
conditions set out therein:-
11
12
(i) in respect of any company other than AerFi POL, that such
company on such date:
(a) is not unable to pay its debts nor would it be deemed
to be unable to pay its debts within the meaning of
the Relevant Solvency Acts (as defined below); and
(b) would not become unable to pay its debts nor would be
deemed to be unable to pay its debts within the
meaning of the Relevant Solvency Acts (as defined
below)
where "RELEVANT SOLVENCY ACTS" means (i) in respect of a company
incorporated in Ireland, Section 214 of the Companies Act, 1963 (as
amended) and Section 2 of the Companies (Amendment) Act, 1990 (as
amended by Section 5 of the Companies (Amendment) (No. 2) Act, 1999),
and (ii) in respect of a company incorporated or formed and organised
outside Ireland, the equivalent provisions under the laws of its
jurisdiction of incorporation or, as the case may be, formation and
organisation; and
(ii) in respect of AerFi POL, that on such date:-
(a) the fair value of its property is greater than the
total amount of its liabilities, including, without
limitation, contingent liabilities;
(b) the present fair saleable value of its assets is not
less than the amount that will be required to pay its
probable liability on its debts as they become
absolute and matured;
(c) it does not intend to, and does not believe that it
will, incur debts or liabilities beyond its ability
to pay such debts and liabilities as they mature;
(d) it is not engaged in business or a transaction, and
is not about to engage in business or a transaction,
for which its property would constitute an
unreasonably small capital;
for the purposes of this paragraph (ii), the amount of contingent
liabilities at any time shall be computed as the amount that, in the
light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability;
and the term "INSOLVENT" shall be construed accordingly;
"SUB CLASS D-1 NOTES" has the meaning attributed to that term in the
Notes Indenture;
"SUBSTITUTE AIRCRAFT" means each Aircraft which AerCo agrees to accept
in substitution for a Remaining Aircraft in accordance with Clause 6.1
of this Agreement;
"TCA" means the Taxes Consolidation Act, 1997 of Ireland;
"TERMINATION NOTICE" has the meaning set forth in Clause 6.2 hereto;
and
12
13
"WARRANTIES" means the warranties and undertakings of the Sellers
contained in Schedule 3.
1.2 COMPUTATION OF TIME PERIODS: In this Agreement, in the computation of
periods of time from a specified date to a later specified date, the
word "FROM" means "FROM AND INCLUDING" and the words "TO" and "until"
each mean "TO BUT EXCLUDING".
1.3 STATUTES: Any reference in this Agreement and/or in the Schedules
hereto to any statute or statutory provision shall be deemed to include
any statute or statutory provision which amends, extends, consolidates
or replaces the same, or which has been amended, extended, consolidated
or replaced by the same and shall include any orders, regulations,
instruments or other subordinate legislation made under the relevant
statute.
1.4 NUMBER, GENDER: Unless the context otherwise requires, words importing
the singular number shall include the plural number and vice versa and
words importing persons shall include corporations.
1.5 NOTES INDENTURE DEFINITIONS: Capitalised terms used in Clause 2.3 and
not otherwise defined herein have the meanings specified in the Notes
Indenture.
1.6 INTERNAL REFERENCES:
(a) Words such as "HEREUNDER", "HERETO", "HEREOF" and "HEREIN" and
other words commencing with "HERE" shall unless the context
clearly indicates the contrary refer to the whole of this
Agreement and not to any particular clause, sub-clause,
paragraph or sub-paragraph hereof.
(b) References to "THIS AGREEMENT" include the schedules, annexes
and Exhibits hereto and the Disclosure Letter, and any
amendments made in accordance with clause 14.6 below.
(c) Any reference to any clause, sub-clause, paragraph or
sub-paragraph shall be a reference to the clause, sub-clause,
paragraph or sub-paragraph of this Agreement in which the
reference occurs unless it is indicated that reference to some
other provision is intended.
(d) All references to Schedules refer to Schedules to this
Agreement.
1.7 HEADINGS: The headings contained in this Agreement and the Schedules
are inserted for convenience of reference only and shall not in any way
form part of nor affect or be taken into account in the construction or
interpretation of any provisions of this Agreement or the Schedules.
2. PURCHASE AND SALE
2.1 PURCHASE AND SALE: Upon the terms and subject to the conditions of this
Agreement:-
(a) AerFi (as beneficial owner) and Skyscape (as registered
holder) shall sell, and AerCo shall purchase, the Shares in
each Company (other than
13
14
Indigo Aviation Ireland Limited, Indigo Aviation (Leasing)
Limited, AerFi POL, Baltic II and Baltic III);
(b) AerFi Inc. shall sell (as beneficial owner and as holder of
record), and AerCo USA shall purchase, the AerFi POL Stock;
(c) Indigo Aviation (as beneficial owner) and KB Flygplanet (as
registered holder) shall sell, and AerCo shall purchase, the
Shares in Baltic II;
(d) Indigo Aviation (as beneficial owner) and KB Flygplanet (as
registered holder) shall sell, and AerCo shall purchase, the
Shares in Baltic III; and
(e) AerFi (as beneficial owner and as registered holder) shall
sell, and AerCo shall purchase, the Shares in Indigo Aviation
Ireland Limited and Indigo Aviation (Leasing) Limited.
2.2 PURCHASE PRICE AND OTHER PAYMENTS
(a)
(i) The consideration payable for the Shares in each
Company to be transferred on the applicable Closing
Date shall be equal to the aggregate Initial
Appraised Values of the Aircraft owned by such
Company on such Closing Date less the amount of any
Security Deposits held by such Company in respect of
the related Leases and less the amount of Company
Debt of such Company (such amount being the "PURCHASE
PRICE" for such Company).
(ii) The relevant Purchaser shall lend to the Company
whose Shares it is acquiring on such Closing Date an
amount equal to the outstanding principal balance of
such Company's Company Debt the proceeds of which
loan will be used by such Company to repay such
Company Debt on the relevant Closing Date.
(iii) The obligation to pay the Purchase Price and to repay
the relevant Company's Company Debt on the Closing
Date shall be satisfied and discharged by:-
(A) the payment to or at the direction of the
relevant Seller(s) of the amount of cash
allocable to each Aircraft owned by such
Company and payable out of the Aircraft
Purchase Account as set forth in Column V of
Schedule 1 to Exhibit A hereto, plus or
minus the Holdback or Rebate, respectively,
set forth on Exhibit A according to the
delivery position of each such Aircraft; and
(B) an increase in the principal amount of the D
Notes issued on the Offering Closing Date as
contemplated in Clause 2.2(e) hereof in such
principal amount as is allocable to the
relevant Aircraft owned by such Company, as
set forth in Column VI of Schedule 1 to
Exhibit A; and
14
15
(C) an increase in the principal amount of E
Notes in such principal amount as is
allocable to the relevant Aircraft as set
forth in Column VII of Schedule 1 to Exhibit
A, as such allocable amount may be adjusted
according to Exhibit A.
(iv) AerCo shall be entitled (and is hereby authorised) to
deduct and retain, from the total amount payable on
the Closings to occur on the Offering Closing Date,
$10,300,000 in respect of expenses incurred in
connection with the Offering.
(v) With respect to each Company the Shares of which are
transferred subsequent to the Offering Closing Date,
the following additional payments shall be made:-
(A) the relevant Purchaser shall pay to AerFi
the Net Accrued Expenses, if any; and
(B) if the Net Maintenance Amount as of the
relevant Closing Date is a positive number
(i.e., the Maintenance Reimbursement Amount
exceeds the Required Maintenance Expenses),
then AerFi shall pay to AerCo the Net
Maintenance Amount and if the Net
Maintenance Amount as of such Closing Date
is a negative number (i.e., the Maintenance
Reimbursement Amount is less than the
Required Maintenance Expenses), then AerCo
shall pay to AerFi the Net Maintenance
Amount.
(b) Any amounts described in Clause 2.2(a)(v) shall be paid on the
Reimbursement Date immediately succeeding the relevant Closing
Date. All other amounts payable under this Clause 2.2 shall be
made on the relevant Closing Date.
(c) For the purposes of Exhibit A, the delivery position of each
Aircraft shall be determined sequentially according to the
date on which the Shares in the relevant Company are
transferred and if thereby more than one Aircraft is delivered
on a particular Closing Date, AerCo shall determine the
delivery position of each Aircraft in its sole discretion.
(d) An amount equal to the Security Deposits with respect to the
Aircraft owned by the Companies whose Shares are transferred
on each Closing Date shall be transferred from the Aircraft
Purchase Account to the Collection Account to be held as part
of the Liquidity Reserve Amount.
(e) On the Offering Closing Date AerCo shall issue D Notes in an
initial principal amount of $80,000,000 to refinance the Sub
class D-1 Notes.
2.3 AGREEMENTS BETWEEN AERCO AND AERFI.
(a) AerCo agrees that so long as the Class D Notes and the Class E Notes
are outstanding, AerCo will furnish to AerFi, by first-class mail as
soon as practicable (i) all documents distributed by the Trustee (to
the extent received by AerCo) or
15
16
AerCo to the holders of the Notes, or filed with the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder and (ii) from time to time, such other
information concerning AerCo available to Holders of the Class A Notes,
the Class B Notes and Class C Notes pursuant to the Notes Indenture as
AerFi may reasonably request.
(b) So long as the Class D Notes and the Class E Notes are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities
Act, unless at the time AerCo is subject to and in compliance with the
reporting requirements of Section 13 of the Exchange Act, AerCo will
provide to AerFi and any holder of any portion of the Class D Notes and
the Class E Notes and to any prospective purchaser of any portion of
the Class D Notes and Class E Notes designated in writing to AerCo by a
holder, upon the request of such holder or prospective purchaser, any
information in AerCo's possession or knowledge required to be provided
by Rule 144A(d)(4) under the Securities Act to permit compliance with
Rule 144A in connection with resales of the Class D Notes and Class E
Notes.
(c) In addition to the restrictions set forth in paragraph (d), AerFi
agrees that it (and any subsequent holder or holders of the Class D
Notes and the Class E Notes) will not directly or indirectly knowingly
sell, transfer or otherwise dispose of the Class D Notes and the Class
E Notes or any portion thereof or any interest therein to or for the
benefit of any person who is resident in Jersey for the purposes of the
Income Tax (Jersey) Law 1961 as amended.
(d) AerFi represents and warrants that it is purchasing the Class D Notes
and the Class E Notes for its own account, for investment purposes and
not with a view to the distribution thereof. AerFi agrees that it will
not, directly or indirectly, offer, transfer, sell, assign, pledge,
hypothecate or otherwise dispose of all or any portion of the Class D
Notes or Class E Notes (or solicit any offers to buy, purchase, or
otherwise acquire or take a pledge of any of the Class D Notes or Class
E Notes), except in compliance with the terms of the Notes Indenture
and with the Securities Act, and the rules and regulations thereunder.
2.4 NO LIENS: The Shares in each Company shall be sold free from all Liens
and with the benefit of all rights attached or accruing thereto.
3. CLOSING
Closing of the sale and purchase of the Shares in each Remaining
Company shall take place on the first Business Day after the Offering
Closing Date on or by which the conditions specified in this Clause 3
and in Clause 13 are or have been satisfied in relation to that
Remaining Company. Closing of the sale and purchase of the Shares in
each Company to be delivered on the Offering Closing Date shall be
subject to the conditions in Clause 13 and to the following conditions
in relation to that Company:-
(a) the relevant Seller(s) shall deliver to the relevant Purchaser
or its nominee (in Dublin, in the case of the items referred to
in paragraph (i), and in New York in the case of the items
referred to in paragraph (ii), and as regards the other items at
such location as the relevant Seller(s) and relevant
16
17
Purchaser shall agree) the following items insofar as they relate
either to the sale and purchase of the Shares in that Company or to the
Aircraft owned by that Company:-
(i) duly executed transfers in favour of the relevant Purchaser
and/or its nominees in respect of all the Shares in that
Company together with all existing share or membership
interest certificates issued in respect thereof or in the case
of any lost share certificate an indemnity in lieu thereof in
terms reasonably satisfactory to the relevant Purchaser;
(ii) (in the case of the Closing of the sale and purchase of the
AerFi POL Stock) duly executed stock transfers in favour of
AerCo USA and/or its nominee(s) in respect of the AerFi POL
Stock together with all existing share certificates issued in
respect thereof or in the case of any lost share certificate
an indemnity in lieu thereof in terms reasonably satisfactory
to AerCo USA;
(iii) written notification by the relevant Seller(s) to the relevant
Purchaser of the Aircraft owned by the Company to be
transferred which shall, in the case of a Remaining Company,
be delivered no less than one Business Day prior to the
relevant Closing Date (the "DELIVERY NOTICE") and shall
contain the information described in Warranty 8.1 in Part 1 of
Schedule 3 hereto with respect to such Company and its
Aircraft;
(iv) a certified copy of any power of attorney under which any
document required to be delivered to the relevant Purchaser
under this Clause has been executed and such other documents
including any waivers or consents as the relevant Purchaser
may require to enable the relevant Purchaser and/or its
nominees to be registered as holders of the Shares;
(v) the originals or copies (certified by or on behalf of the
relevant Company) of the certificate of incorporation and
certificates of incorporation on change of name or
organisation and (in the case of AerFi POL), the by-laws of
AerFi POL and the seals, statutory books (duly written up to
date), books of account, and all other constitutional
documents, books, documents or records and papers of the
Company or evidence satisfactory to the Purchaser that they
are held by or to the order of the relevant Company;
(vi) (except in the case of Baltic II and Baltic III) the written
resignations of the directors and the other officers from
their respective offices in the relevant Company, with written
acknowledgements under seal from each of them in such form as
the relevant Purchaser requires that he or she has no claim
against the relevant Company in respect of breach of contract,
compensation for loss of office, redundancy or unfair
dismissal or on any grounds whatsoever; and
17
18
(vii) (in the case of Lorenton Limited, AerFi BM Limited, Ergo
Leasing Limited and Indigo Aviation Ireland Limited and Indigo
Aviation (Leasing) Limited) resolutions of the members (A) to
change the names of those Companies to Gustav Leasing XIII
Limited, Gustav Leasing XII Limited, Gustav Leasing XIV
Limited and Gustav Leasing X Limited and Gustav Leasing XI
Limited respectively; (B) to change the Memorandum and the
Articles of Association of each of the said Companies to
conform with those as agreed with AerCo; (C) (in the case of
Lorenton Limited and AerFi BM Limited) to change the issued
share capital of each Company by the issue of 2 further shares
of US $1 each for the purpose of redeeming and cancelling the
two issued Euro deferred shares in the share capital of those
Companies; (D) (in the case of Ergo Leasing Limited) to create
additional authorised Dollar share capital of US$1,000,000
divided into 1,000,000 ordinary shares of $1 each; and (E) in
the case of Indigo Aviation Ireland Limited to increase its
authorised share capital to US$1,000,000 divided into
1,000,000 ordinary shares of $1 each.
(b) in the case of a Non-US Company, a board meeting of the relevant Non-US
Company shall be held at which:-
(i) such persons as the relevant Purchaser may nominate shall be
appointed additional directors or equivalent officers of such
Company;
(ii) the transfers referred to at paragraph 3(a)(i) shall be
approved (subject to stamping, if chargeable with stamp duty);
(iii) the resignations referred to in paragraph 3(a)(vi) shall be
submitted and accepted;
(c) in the case of AerFi POL, a board meeting of AerFi POL shall be held at
which the resignations referred to in paragraph 3(a)(vi) shall be
submitted and accepted, and such persons as the relevant Purchaser may
nominate shall be appointed additional directors or equivalent officers
of AerFi POL; and
(d) the amounts payable on Closing under Clause 2.2 shall be discharged by
(i) with respect to any cash portion, by wire transfer in immediately
available funds to such bank account(s) as the relevant Seller(s) shall
have specified by written notice to the relevant Purchaser not later
than five (5) Business Days prior to the Closing Date) and (ii) the
issuance of the D Notes and the E Notes (in the case of a Closing on
the Offering Closing Date) or adjustment (in the case of a Closing on a
date subsequent to the Offering Closing Date), to the outstanding
principal balance of the D Notes and the E Notes, as described in
Clause 2.2 above.
4. CALCULATION DATE PAYMENTS
18
19
The Sellers acknowledge and agree with the Purchasers that the
Purchasers have relied on the Sellers' representations and agreements
set forth in Clause 8 and AerFi's undertaking in Clause 5 that it will
use its reasonable commercial efforts to meet all conditions precedent
to the transfer of the Remaining Companies with the Remaining Aircraft
prior to 10 July 2001 and that AerCo has obtained financing for the
purpose of purchasing all of the Remaining Companies with the Remaining
Aircraft. The parties agree that, in order to put AerCo in the economic
position that it would be in if the Remaining Companies with the
Remaining Aircraft were all transferred to the Purchasers on the
Offering Closing Date, and in consideration for such reliance, for each
Remaining Aircraft, (a) on each Calculation Date occurring prior to the
Closing Date of the sale of the Shares of the Remaining Company owning
such Remaining Aircraft or the Non-Delivery Date with respect to such
Remaining Aircraft or Remaining Company, AerFi shall pay to AerCo an
amount equal to the Rent Payment for the Rent Transfer Period ending on
such Calculation Date, and (b) on the Payment Date next succeeding the
Calculation Date (a "REIMBURSEMENT DATE"), AerCo shall pay to AerFi the
Rent Payment Reimbursement Amount. On the Calculation Date next
following the Closing Date of the sale of the Shares in the Company
owning a Remaining Aircraft or a Non-Delivery Date with respect to a
Remaining Aircraft, AerFi shall pay to AerCo all Rent Payments relating
to such Remaining Aircraft received for the period from and including
the immediately preceding Calculation Date (or if none, the Offering
Closing Date) to but excluding such Closing Date or Non-Delivery Date,
as the case may be (the "END PERIOD") and, on the following
Reimbursement Date, AerCo shall pay to AerFi interest received on all
funds in the Aircraft Purchase Account during such End Period referable
to the Aircraft and an amount equal to the interest, if any, on the D
and E Notes which would actually have been payable on the Payment Date
next succeeding such Calculation Date had the principal amount of the D
and E Notes allocable to such Remaining Aircraft been outstanding
during such End Period. If at any time following the Closing Date or
Non-Delivery Date with respect to a Remaining Company or Remaining
Aircraft, the Sellers receive any Rent Payment in respect of any period
ending on such Closing Date or Non-Delivery Date or, if any at time
following the Closing Date with respect to a Remaining Company or
Remaining Aircraft, the Seller(s) shall receive any Maintenance Rent in
respect of such Remaining Company or Remaining Aircraft, AerFi shall,
promptly upon receipt thereof, pay such amount to AerCo.
Except as otherwise provided in this Clause 4, neither AerFi nor AerCo
shall have any obligation to make any payments with respect to a
Remaining Aircraft pursuant to this Clause 4 to the extent such
payments relate to any period following the earlier of the Closing Date
of the sale of the Shares in the Company owning such Remaining Aircraft
and the Non-Delivery Date for such Remaining Aircraft or Remaining
Company.
5. ADDITIONAL AerFi OBLIGATIONS WITH RESPECT TO REMAINING AIRCRAFT
AerFi shall be fully responsible for payment of all Lease Expenses and
Required Maintenance Expenses with respect to each Remaining Aircraft
during the period from the Offering Closing Date until the earlier of
(a) a Non-Delivery Date with respect to that Remaining Aircraft and (b)
the Closing Date of the sale of the
19
20
Shares in the Company owning that Remaining Aircraft. AerFi represents
and covenants with AerCo that it shall use its reasonable commercial
efforts to ensure that all Aircraft not owned by Companies the Shares
in which are transferred to the Purchasers on the Offering Closing Date
are transferred to the Purchasers prior to 10 July 2001. AerFi
acknowledges that such efforts may involve the payment of money by
AerFi to release certain liens on such Aircraft and the obtaining of
certain consents. AerFi agrees to keep AerCo informed of its progress
in meeting the conditions to the transfer of each such Aircraft and to
notify AerCo immediately if AerFi reasonably believes that it will have
to deliver a Termination Notice with respect to any Remaining Aircraft
or Remaining Company or proposes delivery of a Substitute Aircraft. In
addition, prior to the Closing Date or, as the case may be,
Non-Delivery Date occurring, AerFi agrees to provide AerCo on each
Calculation Date with a written report of the following information
with respect to each Remaining Aircraft: gross lease receipts received
from each Lessee of a Remaining Aircraft with a breakdown between
rental payment and Maintenance Reimbursement Amount, security deposits
and the form in which they are held, maintenance claims and payments
and status thereof, Required Maintenance Expenses, Lease Expenses,
amounts overdue from each Lessee of a Remaining Aircraft (with
explanation of why amounts are overdue and description of
communications with such Lessee) and any other material information
relating to each Remaining Aircraft.
6. SUBSTITUTION AND TERMINATION
6.1 SUBSTITUTION: AerCo may in its sole discretion agree to accept a
Substitute Aircraft proposed by AerFi provided that (a) such Substitute
Aircraft (i) is no more than seven years old as of 17 July, 2000, (ii)
is subject to an operating lease contract, or letter of intent for an
operating lease contract, that is to become effective within 90 days
after the signing of such letter of intent, (iii) is of the same type
as the undelivered Aircraft and (iv) does not give rise to a
Concentration Default and (b) AerCo shall have received a Rating Agency
Confirmation (as defined in the Notes Indenture) with respect to such
substitution. AerFi shall have obtained an appraisal of the Base Value
of such Substitute Aircraft from the Appraisers as of the date which is
no more than 30 days prior to the Closing Date with respect to the
relevant Remaining Company.
6.2 TERMINATION: If AerFi determines with respect to any Remaining Aircraft
or Remaining Company that, using its reasonable commercial efforts, it
will not be able to meet the conditions set forth in Clause 13 hereto
with respect to the transfer of such Remaining Aircraft or Remaining
Company and will not be able to provide a Substitute Aircraft
acceptable to AerCo, AerFi shall give written notice to AerCo to that
effect (each such notice a "TERMINATION NOTICE"), specifying the
Remaining Aircraft or Remaining Company to which such Termination
Notice applies and the reasons for its inability to meet such
conditions. Upon the delivery of such Termination Notice, the
obligations of the relevant Seller(s) to transfer such Remaining
Aircraft or to sell the Shares of that Remaining Company to the
relevant Purchaser shall terminate and no party shall have any
liability to any other party, whether under this Agreement, the Deed of
Tax Indemnity or any other Transaction Document, in relation to such
Remaining Aircraft or Remaining Company, subject to payment of amounts
described in
20
21
Clause 4 hereof and except to the extent of any obligation accruing
prior to such date and except as provided in Clause 9.
7. NON DELIVERY EVENTS
7.1 DEFINITION: A "NON DELIVERY EVENT" shall occur:--
(a) with respect to a particular Remaining Aircraft, upon delivery
of a Termination Notice with respect to such Aircraft, and
(b) with respect to all Remaining Aircraft at such time, upon the
earliest to occur of:
(i) failure of AerFi to make any of the payments
described in Clause 4 or failure of any Seller to
make when due any payment for which it is liable
under Clause 9.2 within the time period set forth in
such Clause;
(ii) AerFi becoming or being declared insolvent, or an
examiner or receiver or liquidator or similar officer
being appointed over AerFi or over all or a
substantial part of its assets, or AerFi making an
arrangement for the benefit of its creditors
generally or AerFi taking steps (or steps being taken
and not discharged within 21 days) for the winding up
or dissolution of AerFi or for the appointment of an
examiner to it;
(iii) an event or condition which results in the
acceleration of the maturity of indebtedness of AerFi
exceeding in the aggregate $10,000,000;
(iv) failure by the Sellers to comply with any of the
covenants, obligations, conditions or provisions
binding on them under this Agreement (other than as
described in (i) above) if such failure materially
adversely affects the ability of AerCo to make
payments on the Notes (as defined in the Notes
Indenture) and continues for a period of 30 days or
more after written notice thereof has been given to
AerFi by AerCo; and
(v) 10 July 2001.
7.2 EFFECT OF NON DELIVERY EVENT: This Agreement shall terminate upon a Non
Delivery Event described in Clause 7.1(a) with respect to the last
Remaining Aircraft or upon a Non Delivery Event described in Clause
7.1(b). Upon such termination, AerFi and AerCo shall make the payments
required under Clause 4 to the extent of amounts accrued since the last
Calculation Date and shall have no further obligations hereunder except
to the extent of any obligation accruing prior to such date and except
as provided in Clause 9.
8. REPRESENTATIONS AND WARRANTIES OF SELLERS
8.1 WARRANTIES IN TERMS OF SCHEDULE 3: In relation to each Company and
subject to such matters as are contained in the Disclosure Letter (as
updated pursuant
21
22
to Clause 12.1), the Sellers and each of them, jointly and severally,
hereby represent, warrant and undertake to the Purchasers (a) as of the
date hereof in the terms of all of the Warranties (other than those
Warranties which are made as of another date) set out in Schedule 3 and
(b) as at the Closing Date of the sale of the Shares in that Company,
in the terms of all of the Warranties set out in Schedule 3 but only in
relation to that Company.
8.2 SEPARATE AND INDEPENDENT: Each of the Warranties shall be construed as
a separate and independent representation and warranty and shall not be
limited or restricted by reference to the terms of any other provision
of this Agreement or any other Warranty.
8.3 NOTICE AND REMEDY FOR BREACH:
(a) At any time after the Closing of the sale and purchase of the
Shares in any Company, upon becoming aware of any breach of
Warranty, the relevant Purchaser shall be entitled to deliver
to the relevant Seller(s) a notice specifying the Warranty or
Warranties which is or are untrue or incorrect by reference to
the facts and circumstances subsisting at the Closing with
details of such facts or circumstances (a "BREACH NOTICE").
(b) The relevant Seller(s) shall, on receipt of a Breach Notice,
have a period of 30 days (or such longer period as the
relevant Purchaser may agree) from the date of receipt of the
Breach Notice to remedy the matter giving rise to the breach
of Warranty (if capable of remedy) specified in such Breach
Notice.
8.4 DISCLAIMER: SAVE AS EXPRESSLY PROVIDED IN CLAUSE 4 AND SCHEDULE 3
HEREOF, THE SELLERS MAKE NO WARRANTIES, GUARANTEES OR REPRESENTATIONS,
EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO THE
AIRCRAFT OR ANY OF THEM. EACH PURCHASER HEREBY WAIVES RELEASES AND
RENOUNCES ALL WARRANTIES, OBLIGATIONS AND LIABILITIES OF THE SELLERS
INCLUDING BUT NOT LIMITED TO (1) ANY IMPLIED WARRANTY AS TO THE
DESCRIPTION, AIRWORTHINESS, MERCHANTABILITY, FITNESS FOR ANY PURPOSE,
VALUE, CONDITION, DESIGN, USE OR OPERATION OF THE AIRCRAFT OR ANY PAST
PERFORMANCE, COURSE OF DEALING, USAGE OR TRADE OR OTHERWISE, (2) ANY
OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY IN TORT (INCLUDING STRICT
LIABILITY), AND (3) ANY OBLIGATION, LIABILITY, RIGHT, CLAIM OR REMEDY
FOR LOSS OF OR DAMAGE TO THE AIRCRAFT, FOR LOSS OF USE, REVENUE OR
PROFIT WITH RESPECT TO THE AIRCRAFT, FOR ANY LIABILITY OF ANY LESSEE TO
ANY THIRD PARTY, FOR ANY LIABILITY OF THE PURCHASER TO ANY THIRD PARTY,
OR FOR ANY OTHER DIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES; AND ALL
SUCH WARRANTIES, GUARANTEES, REPRESENTATIONS, OBLIGATIONS,
22
23
LIABILITIES, RIGHTS, CLAIMS OR REMEDIES, EXPRESS OR IMPLIED, STATUTORY
OR OTHERWISE, ARE EXPRESSLY EXCLUDED.
9. INDEMNITIES
9.1 PURCHASER INDEMNITY: The Purchasers hereby jointly and severally agree
to indemnify the Sellers and their Affiliates, and any of their
successors and assigns, officers, directors, servants, agents and
employees (each a "PURCHASER INDEMNITEE") from and against any claims,
damages, losses, costs, expenses, fees (including counsel's fees),
payments, demands, liabilities, actions, proceedings, penalties or
fines (together, the "LOSSES") which any Purchaser Indemnitee may incur
or suffer, (i) in relation to any Aircraft to the extent it arises out
of a loss or liability relating to acts or omissions (other than acts
or omissions of a Purchaser Indemnitee) after the Closing Date of the
sale of the Shares in the Company owning such Aircraft, or (ii) in
relation to any misrepresentation or breach of warranty, covenant or
agreement made or to be performed by the Purchasers pursuant to this
Agreement (together the "PURCHASER Indemnity"), provided that:-
(a) such loss or liability would exceed in the aggregate US$4
million and, in such event, subject to Clause 10 hereof, the
Purchaser agrees to indemnify for the full amount of such loss
or liability; and
(b) the Purchaser Indemnity shall not extend to any claim on
account of any Taxes occasioned by any delivery of Aircraft.
9.2 SELLER INDEMNITY: The Sellers hereby jointly and severally agree to
indemnify the Purchasers and their Affiliates, and any of their
successors and assigns, officers, directors, servants, agents and
employees (each a "SELLER INDEMNITEE" and, together with the Purchaser
Indemnitees, the "INDEMNIFIED PARTIES") against any Losses arising out
of or resulting from:-
(a) the breach by the Sellers of any Warranty;
(b) the breach of any covenant or agreement contained in this
Agreement by the Sellers; and
(c) non-agreed Liabilities of any Company not reflected on the
Reference Balance Sheet of that Company, whether arising
before or after the Closing Date of the sale of the Shares in
that Company, that are directly caused by any action or
inaction on the part of the Company prior to such Closing Date
other than any actions or inactions in the ordinary course of
the business of the relevant Company,
in each case whether or not any action, investigation, litigation or
proceeding relating thereto is brought by the Purchasers, the Sellers
or any other Seller Indemnitee and whether or not a Seller Indemnitee
is otherwise a party thereto. To the extent that the Sellers'
undertakings in this Clause 9.2 may be unenforceable,
23
24
the Sellers shall jointly and severally contribute the maximum amount
that they are permitted to contribute under any applicable law to the
payment and satisfaction of all Losses incurred by the Purchasers or
any Company which any Seller Indemnitee may incur or suffer, provided
that the indemnity contained in this Clause 9.2 shall not extend to or
cover any liabilities or claims for Losses resulting from, incurred in
connection with or arising from a Tax liability (it being the intention
of the parties that claims in respect of Tax would be the subject
matter of the Deed of Tax Indemnity).
9.3 NOTICE OF CLAIMS:
(a) An Indemnified Party shall give the Purchasers or the Sellers
(as the case may be) (the "INDEMNIFYING PARTY") notice of any
matter which such Indemnified Party has determined has given,
or could give, rise to a right of indemnification under this
Agreement, within sixty (60) days of such determination. The
notice shall state the amount of the Loss, if known, and the
method of its calculation and shall contain a reference to the
provisions of this Agreement in respect of which such right of
indemnification is claimed or arises.
(b) If an Indemnified Party receives written notice of any third
party claim or potential claim ("THIRD PARTY Claim") against
it which is or may be the subject of a claim by it under the
Purchaser Indemnity or the Seller Indemnity (as the case may
be), the obligations and liabilities of the Indemnifying Party
under this Clause 9 shall be subject to the following terms
and conditions:-
(i) the Indemnified Party shall give written notice
thereof to the Indemnifying Party within thirty (30)
days of receipt of such notice provided that failure
to give such notice shall not release the
Indemnifying Party from any of its obligations under
this Clause 9 except to the extent such Indemnifying
Party has been released from any other obligation or
liability that it may have to an Indemnified Party
otherwise than under this Clause 9;
(ii) the Indemnifying Party shall be entitled to assume
and control the defence of such Third Party Claim and
take such further action to contest, resist or appeal
the validity, applicability and amount of such claim
in appropriate administrative or judicial proceedings
either:-
(A) in the name of the Indemnified Party
(provided the Indemnifying Party shall
indemnify and secure the Indemnified Party
to its reasonable satisfaction against all
losses costs damages and expenses which may
be incurred thereby), or
(B) in its own name,
in either case, at its own expense and through retaining legal
advisers of its choice provided that it gives notice of its
intention to do so to the Indemnified Party within five (5)
days of receipt of the notice of such Third
24
25
Party Claim from the Indemnified Party; provided however, that
if there exists or is reasonably likely to exist a conflict of
interest that would make it inappropriate in the judgement of
the Indemnified Party, in its sole and absolute discretion,
for the same legal advisers to represent both the Indemnified
Party and the Indemnifying Party, then the Indemnified Party
shall be entitled to retain its own legal advisers, in each
jurisdiction for which the Indemnified Party reasonably
determines counsel is required, at the expense of the
Indemnifying Party. In the event that the Indemnifying Party
exercises its right hereunder to undertake the defence of any
such Third Party Claim, the Indemnified Party shall co-operate
with the Indemnifying Party in such defence as is reasonably
required by the Indemnifying Party. In the event that the
Indemnified Party is, directly or indirectly, conducting the
defence against any such Third Party Claim, the Indemnifying
Party shall co-operate with the Indemnified Party in such
defence as is reasonably required by the Indemnified Party. No
such Third Party Claim may be settled by the Indemnifying
Party without the prior written consent of the Indemnified
Party and no such Third Party Claims may be settled by the
Indemnified Party without the prior written consent of the
Indemnifying Party.
9.4 TO BE MADE FREE FROM DEDUCTIONS: All sums payable under or pursuant to
the Purchaser Indemnity or the Seller Indemnity shall be paid free and
clear of all deductions or withholdings whatsoever save only as may be
required by law. If any such deductions or withholdings are required by
law the Indemnifying Party shall be obliged to pay to the Indemnified
Party such sums as will after such deduction or withholding have been
made leave the Indemnified Party with the same amount as it would have
been entitled to receive in the absence of any such requirement to make
a deduction or withholding together with interest on the amount payable
by the Indemnifying Party under this sub-clause at a rate equal to the
rate of interest applicable to the AerCo Group Class D Notes (as
defined in the Notes Indenture) in respect of the period commencing on
the date upon which payment of the full amount was due until payment by
the Indemnifying Party of such amount is made (both before and after
judgement). If any sum payable by the Indemnifying Party under or
pursuant to the Purchaser Indemnity or the Seller Indemnity is subject
to tax in the hands of the Indemnified Party the same obligation to
make an increased payment shall apply in relation to such tax liability
as if it were a deduction or withholding required by law. For the
avoidance of doubt, the parties hereby agree and confirm that any
Indemnifying Party shall not be under any obligation to make any
payment to any Indemnified Party under this Clause 9.4 to the extent
that the Indemnified Party would be in a better position than if no
payment by way of indemnity was required to be made.
10. LIMITATIONS ON WARRANTIES AND INDEMNITIES
10.1 TIME LIMIT ON CLAIMS: No claim arising out of the sale of the Shares in
any Company shall be brought by the Purchasers in respect of any breach
of the
25
26
Warranties or under or pursuant to the Seller Indemnity unless notice
in writing of such claim (specifying in reasonable detail (a) the event
matter or default which gives rise to the claim, (b) the breach that
results and (c) the amount claimed) has been given to the Sellers not
later than, in the case of a tax Warranty, 17 July 2007 or, in the case
of any other Warranty, three years from the Closing Date of the sale of
the Shares in the relevant Company.
10.2 FINANCIAL LIMIT ON CLAIMS: Notwithstanding anything to the contrary
contained in this Agreement, the Deed of Tax Indemnity, or the Aircraft
Purchase Agreements the maximum aggregate liability of:--
(a) the Sellers and their Affiliates arising out of or resulting
from or by reason of any claims under or pursuant to (i) the
Warranties, (ii) the Seller Indemnity (iii) the Deed of Tax
Indemnity, (iv) the Aircraft Purchase Agreements and/or (v)
this Agreement shall not exceed US$175 million; and
(b) the Purchasers arising out of or resulting from or by reason
of any claims under or pursuant to the representations and
warranties contained in this Agreement or the Purchaser
Indemnity shall not exceed US$4 million.
Each of the Sellers hereby agrees that, with respect to any claim under
a Purchaser Indemnity, the Seller shall be entitled to payment only to
the extent that all amounts payable in items "First" through
"Twenty-Seventh" in Section 3.08(a) of the Notes Indenture have been
paid in full.
10.3 EXCLUSION OF SMALL CLAIMS: The Sellers shall only be liable in respect
of any claim brought by the Purchaser for a breach of the Warranties or
Seller Indemnity if the aggregate liability of the Sellers for such
claims, when aggregated with any claims under the Deed of Tax
Indemnity, would exceed in aggregate US$4.25 million (the "THRESHOLD").
In the event that such claim or claims exceed the Threshold, the
Sellers shall be liable (subject to Clause 10.2(a)) for the full amount
of such claim.
10.4 RETROSPECTIVE LEGISLATION: The Sellers shall not be liable for any
breach of any of the Warranties if such breach arises as a result of
any statute, enacted or any amendment, modification or order made or
statutory instrument passed or the occurrence of any analogous event
after the date of this Agreement.
10.5 LIABILITY OF SKYSCAPE: The Purchasers hereby acknowledge that Skyscape
is a party to this Agreement in its capacity only as holder of shares
in the Irish Companies as nominee for AerFi. Skyscape's maximum
liability to the Purchasers in respect of any claims under this
Agreement (including any breaches of Warranty or under the Seller
Indemnity) or under the Deed of Tax Indemnity shall be limited to
IR(pound)1.
26
27
10.6 LIABILITY OF KB FLYGPLANET: The Purchasers hereby acknowledge that KB
Flygplanet is a party to this Agreement in its capacity only as holder
of membership interests in Baltic II and Baltic III as a nominee of
Indigo Aviation. KB Flygplanet's maximum liability to the Purchasers in
respect of any claims under this Agreement (including any breaches of
Warranty or under the Seller Indemnity) or under the Deed of Tax
Indemnity shall be limited to IR(pound)1.
11. REPRESENTATIONS AND WARRANTIES OF PURCHASERS
WARRANTIES IN TERMS OF SCHEDULE 4: The Purchasers hereby jointly and
severally represent, warrant and undertake to the Sellers and each of
them in the terms of the Purchaser Warranties.
12. ADDITIONAL COVENANTS AND AGREEMENTS
12.1 FURTHER ACTION: At the request of the Purchasers, the Sellers and each
of them shall (and shall procure that any other necessary parties
shall) execute and do all such documents, acts and things as may
reasonably be required by any Purchaser subsequent to the date hereof
and to any Closing of the sale of Shares to that Purchaser in order to
perfect the right, title and interest of the relevant Purchaser to and
in any Shares which have been purchased by it and to procure the
registration of the relevant Purchaser and/or its nominee(s) as the
registered holder(s) of the relevant Shares. The Sellers shall deliver
supplements to the Disclosure Letter as and when necessary to ensure
that information therein relating to the Remaining Aircraft is accurate
and current.
12.2 INSURANCE: Each Purchaser covenants and agrees to use its best
endeavours to procure or to cause the Lessees of all Aircraft owned by
any Company acquired by either Purchaser pursuant to this Agreement to
continue to maintain in accordance with the terms of the Leases until
the third anniversary of the Closing Date of the sale of the Shares in
that Company, insurances relating to the Aircraft naming as additional
insureds those of the Sellers or their Affiliates, or any existing
Servicer of any of them, who are named as insureds on the insurance
policies in effect at the applicable Closing Date. In the event that
any such existing insurance coverage in respect of the Sellers or their
Affiliates, or any existing Servicer, cannot be maintained, the
Purchasers shall provide written notice to the Sellers before such
coverage is terminated.
12.3 MANUFACTURERS' WARRANTIES/ FURTHER ASSURANCE: The Sellers agree to
assign, or, as appropriate, to use their best endeavours to procure
that their Affiliates assign to the relevant Company, to the extent
permitted by law, any rights and benefits under any manufacturers'
warranties still in effect to the extent that they (a) relate to the
Aircraft owned or acquired by that Company and (b) have not already
been assigned to the relevant Company. After the date of this Agreement
and each applicable Closing Date, the Purchasers and the Sellers
27
28
agree to take all appropriate action which may be reasonably necessary
or advisable to carry out any of the provisions hereof; provided that,
with respect to carrying out the assignments referred to in the
preceding sentence, the Sellers shall not be obliged to seek the
consent of any such manufacturer.
13. CONDITIONS
13.1 CONDITIONS TO OBLIGATIONS OF SELLERS: The obligations of the Sellers
under this Agreement in relation to the sale of the Shares in any
Company are conditional upon satisfaction of the following conditions
and the conditions specified in Section 3(d) hereof on or prior to the
applicable Closing of the sale and purchase of the Shares in that
Company:--
(a) (if the Company is incorporated in Ireland) compliance with
rules regarding provision of financial assistance in Ireland;
(b) the Company being the owner of the Aircraft specified in the
applicable Delivery Notice;
(c) all authorisations, consents, orders and approvals of
Government Authorities and officials listed in the Disclosure
Letter (as updated pursuant to Clause 12.1 hereof) having been
obtained in form and substance reasonably satisfactory to the
Sellers;
(d) the representations and warranties of the Purchasers contained
in Schedule 4 of this Agreement being true and correct when
made and being true and correct in all material respects as of
the applicable Closing Date, other than such representations
and warranties as are made as of another date, and the
covenants and agreements contained in this Agreement to be
complied with by the Purchasers on or before Closing having
been complied with in all material respects, and the Sellers
having received a duly executed certificate of the Purchasers
to such effect as of the date of such Closing;
(e) no Action having been commenced by or before any Governmental
Authority against any of the Sellers, the Purchasers, the
Companies or any of them seeking to restrain or materially and
adversely alter the transactions contemplated by this
Agreement which, in the reasonable, good faith determination
of the Sellers, is likely to render it impossible or unlawful
for any of the parties to perform their obligations hereunder,
provided however that this condition shall not apply to any
Action directly or indirectly solicited or encouraged by the
Sellers;
(f) the relevant Purchaser having performed or having satisfied in
all material respects all covenants, agreements and conditions
on its part to be performed or satisfied by it under this
Agreement and, to the extent required to be satisfied on or
prior to the applicable Closing Date, the Other Transaction
Documents and Related Documents to which it is a party, and no
material default having occurred and being still in existence,
or resulting from the execution, delivery or performance of
this Agreement under any Other Transaction Document;
28
29
(g) the Note Purchase Agreement having been duly entered into on
terms satisfactory to the Sellers and having become
unconditional in all respects save for any conditions relating
to this Agreement or the satisfaction of the conditions
precedent hereunder;
(h) receipt of a certified copy resolution of the board of
directors of each Purchaser duly authorising the execution,
delivery and performance by that Purchaser of this Agreement
and the Deed of Tax Indemnity and the transactions
contemplated hereby and thereby; and
(i) receipt of a certificate of a director or of the secretary or
assistant secretary of each Purchaser certifying the names and
signatures of each of the directors or other officers of that
Purchaser authorised to sign this Agreement and the Deed of
Tax Indemnity and the documents to be delivered, hereunder and
thereunder.
13.2 CONDITIONS TO OBLIGATIONS OF PURCHASERS: The obligations of the
Purchasers under this Agreement in relation to the purchase of the
Shares in any Company are conditional upon satisfaction of the
following conditions and the conditions specified in Clauses 3(a), 3(b)
and 3(c) hereof with respect to that Company on or prior to the Closing
of the sale and purchase of the Shares in that Company, none of which
may be waived unless AerCo has obtained a Rating Agency Confirmation
(as defined in the Notes Indenture), provided that the Warranties of
the Sellers shall only be made with respect to the Company or Companies
which is or are being transferred to the Purchasers on such Closing
Date:-
(a) (if the Company is incorporated in Ireland) compliance with
rules regarding provision of financial assistance in Ireland;
(b) the Company being the owner of the Aircraft specified in the
applicable Delivery Notice;
(c) delivery by AerFi to AerCo of a certificate signed by a
director or officer of AerFi certifying the amount of Company
Debt of that Company as at the Reference Balance Sheet Date;
(d) all authorisations, consents, orders and approvals of
Government Authorities and officials listed in the Disclosure
Letter (as updated pursuant to Clause 12.1 hereof) having been
obtained in form and substance reasonably satisfactory to the
relevant Purchaser;
(e) subject to such matters as may be disclosed in the Disclosure
Letter (as updated pursuant to Clause 12.1), the Warranties
being true and correct as of the applicable Closing Date (and
in the case of Warranties relating to the Pro-Forma Balance
Sheets, as of the Offering Closing Date), other than such
Warranties as are made as of another date and the covenants
and agreements contained in this Agreement to be complied with
by the Sellers on or before the relevant Closing having been
complied with in all material respects in relation to the
Company and the Purchasers having received a duly executed
certificate from the Sellers to such effect as of the date of
such Closing;
29
30
(f) no Action having been commenced or threatened by or before any
Governmental Authority against the Sellers, the Purchasers,
the Companies or any of them seeking to restrain or materially
and adversely alter the transactions contemplated hereby which
the Purchasers reasonably believe is likely to render it
impossible or unlawful for any of the parties to perform their
obligations hereunder or which could have a Material Adverse
Effect and the Purchasers having received a duly executed
certificate of the Sellers to such effect in regard to the
Sellers and the Companies; provided however that this
condition shall not apply to any Action solicited or
encouraged by the Purchasers;
(g) receipt of a certified copy resolution of the board of each of
the Sellers duly authorising the execution, delivery and
performance by the Sellers of this Agreement and the Deed of
Tax Indemnity and the transactions contemplated hereby and
thereby;
(h) receipt of a certificate of a director or the secretary or
assistant secretary of each of the Sellers certifying the
names and signatures of each of the officers of the Sellers
authorised to sign this Agreement and the Deed of Tax
Indemnity and the documents to be delivered thereunder;
(i) the relevant Seller(s) having delivered to the relevant
Purchaser a certificate of solvency in the relevant form set
out in Schedule 6A, 6B, 6C or 6D or such other form as may be
agreed with the relevant Purchaser on the date hereof and on
each Closing Date;
(j) the Note Purchase Agreement and Other Transaction Documents
relating to the relevant Company having been duly entered into
and having become unconditional in all respects save for any
conditions relating to this Agreement or the satisfaction of
the conditions precedent hereunder;
(k) insofar as not already provided to the relevant Purchaser or
held by the relevant Company, receipt by AerCo of:-
(i) the Aircraft Purchase Agreements relating to the
Aircraft owned by the relevant Company;
(ii) the Leases relating to the Aircraft owned by the
relevant Company or confirmation (in terms
satisfactory to the relevant Purchaser) that same are
or will be held to the order of the relevant
Purchaser or the relevant Company; and
(iii) delivery acknowledgements or bills of sale evidencing
the title of the relevant Company to the relevant
Aircraft provided that nothing in this Clause shall
compel the Sellers to produce any original bills of
sale at any location in the United Kingdom;
(l) the relevant Purchaser having determined that each member of
the Seller Group has performed or caused to have performed on
or prior to the applicable Closing Date each covenant,
agreement, delivery or condition to be performed or satisfied
under all of the Leases relating to the Aircraft
30
31
owned by the relevant Company on or prior to the applicable
Closing Date, the non-performance of which, taken as a whole,
would materially affect the decision of a reasonable purchaser
of the Notes to purchase the Notes;
(m) receipt of certified copies of the reports of the Appraisers
(including, if applicable, with respect to Substitute
Aircraft);
(n) receipt of a counterpart of the Deed of Tax Indemnity duly
executed by the Sellers;
(o) receipt of the Disclosure Letter (including any supplements to
the applicable Closing Date) in form and substance reasonably
satisfactory to the Purchasers;
(p) receipt of an opinion of the Insurance Adviser with respect to
the Aircraft owned by the Company;
(q) receipt of evidence satisfactory to the relevant Purchaser
that any mortgage, charge, pledge of or other security over
the Shares in the relevant Company has been released;
(r) the Sellers having performed and observed to the satisfaction
of the Purchasers all of the terms and provisions of this
Agreement to be performed and observed by the Sellers, this
Agreement not having been cancelled or terminated, and there
having been no amendment or modification of this Agreement or
any waiver of any default hereunder;
(s) only with respect to the transfer of the AerFi POL Stock,
delivery of an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
in form and substance satisfactory to AerCo USA;
(t) only with respect to the sale of Shares in the Irish
Companies, delivery of a mortgage of shares, substantially in
the form of Exhibit B attached hereto, together with a legal
opinion in form and substance satisfactory to AerCo with
respect to the title of the mortgagor to the Shares to be
mortgaged; and
(u) only with respect to the sale of Shares in Baltic II and
Baltic III, delivery by AerCo of a mortgage of membership
interests, substantially in the form of Exhibit C attached
hereto together with a legal opinion in form and substance
satisfactory to AerCo with respect to the title of the
mortgagor to the Shares to be mortgaged.
13.3 LEGAL OPINIONS: The Sellers shall deliver to the Purchasers on the
Offering Closing Date each of the opinions required to be delivered
pursuant to the Note Purchase Agreement. On each subsequent Closing
Date the relevant Sellers shall deliver to the Purchasers a legal
opinion, in form and substance satisfactory to AerCo, in relation to
the title of the relevant Sellers to the Shares to be sold on that
Closing Date from local counsel to the Sellers
31
32
13.4 FURTHER CONDITION AND AGREEMENT: The obligations of the Sellers and the
Purchasers under this Agreement are further conditional upon no change
having occurred after the date of this Agreement in any applicable law
which would make it illegal for any party to this Agreement or the
Other Transaction Documents or Related Documents to perform any of
their respective obligations under this Agreement or such Other
Transaction Documents or Related Documents; provided, however, that if
any such change has occurred in relation to this Agreement, the parties
shall co-operate and for such purposes use all reasonable endeavours to
restructure their respective obligations under this Agreement so as to
avoid the aforementioned illegality.
14. MISCELLANEOUS
14.1 WAIVER: The Sellers or the Purchasers may extend the time for the
performance of any of the obligations or other acts of the other
parties. Any such extension shall be valid only if set forth in an
instrument in writing signed by the party or parties to be bound
thereby. The Sellers may waive any inaccuracies in the representations
and warranties of the Purchasers or any condition to the Closing of the
sale of the Shares of any of the Companies. The Purchasers may waive
any inaccuracies in the representations and warranties of the Sellers
made on any Closing Date or any condition to the Closing of the sale of
the Shares of any of the Companies only with the approval in writing of
the Trustee under the Notes Indenture and after having obtained a
Rating Agency Confirmation (as defined in the Notes Indenture). Any
waiver of any term or condition shall not be construed as a waiver of
any subsequent breach or a subsequent waiver of the same term or
condition, or a waiver of any other term or condition, of this
Agreement. The failure by any party to assert any of its rights
hereunder shall not constitute a waiver of any of such rights.
14.2 EXPENSES: Except as otherwise specified in this Agreement, each party
to this Agreement shall pay its own costs of and incidental to this
Agreement and the sale and purchase hereby agreed to be made, whether
or not any Closing shall have occurred.
14.3 NOTICES: Every notice, request, demand or other communication under
this Agreement shall:-
(a) be in writing delivered personally, or by prepaid courier
delivery services such as Federal Express, DHL or other
similar services, or by telex (but only where being sent to a
party for whom a telex number is stated in paragraph (c)
below) or facsimile (confirmed, in the case of facsimile, by
prepaid airmail letter sent within 24 hours of dispatch but so
that non-receipt of such confirmation shall not affect in any
way the validity of the facsimile in question);
(b) be deemed to have been received, subject as otherwise provided
in this Agreement, in the case of a facsimile or telex, at the
time of dispatch with confirmed answerback of the addressee
appearing at the beginning and end of the communication,
(provided, however, that, in the case of a facsimile, if the
date of dispatch is not a business day in the country of the
addressee it shall be deemed to have been received at the
opening of
32
33
business on the next such business day), and in the case of a
letter, when delivered personally; provided, however, that if
personal delivery or delivery by courier of a notice is
tendered but refused, such notice shall be effective upon such
tender; and
(c) be sent:-
if to the Sellers, to:
Aviation House
Shannon
Co Clare
Ireland
Attn: Company Secretary
Facsimile: 00 353 61 360 220
if to the Purchasers, to:
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Channel Islands
Attn: Mourant & Co. Secretaries Limited
Facsimile: 0044 1534 609 333,
with a copy to AerFi Administrative Services Limited as
Administrative Agent at Aviation House, Shannon, Co ▇▇▇▇▇,
Ireland, Attn: Company Secretary, Facsimile: 00 353 61 360503.
14.4 SEVERABILITY: If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any law or public
policy, all other terms and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected
in any manner materially adverse to any party. Upon any determination
that any term or other provision is invalid, illegal or incapable of
being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner in order that
the transactions contemplated by this Agreement are effected as
originally contemplated to the greatest extent possible.
14.5 ASSIGNMENT: This Agreement shall be binding upon and enure to the
benefit of the successors of the parties but shall not be assignable by
either the Sellers or the Purchasers without the express written
consent of the other parties (which consent may be granted or withheld
in the sole discretion of such other parties) provided however that the
Purchasers may assign this Agreement to an Affiliate of AerCo without
the consent of the Sellers.
14.6 AMENDMENT: This Agreement may not be amended except (a) by an
instrument in writing signed by or on behalf of the Sellers and the
Purchasers or (b) by a waiver in accordance with clause 14.1 hereof.
33
34
14.7 APPLICABLE LAW AND JURISDICTION:
(a) This Agreement shall be governed by and construed in
accordance with the laws of Ireland, except that the
Warranties relating to AerFi POL set out in Part 2 of Schedule
3 and the definition of "SOLVENCY" as it relates to AerFi POL
shall be interpreted in accordance with the laws of the State
of New York.
(b) Each of the parties hereby submits to the non-exclusive
jurisdiction of the courts of Ireland. The Purchasers hereby
irrevocably:-
(i) waive any objections on the ground of venue or forum
non conveniens or any similar grounds; and
(ii) consent to service of process by mail or in any other
manner permitted by applicable law.
(c) Each Purchaser and each Seller shall at all times maintain an
agent for service of process in Ireland. Each Purchaser and
each Seller appoints AerFi Administrative Services Limited, of
Aviation House, Shannon, Co Clare, Ireland, Attn: Company
Secretary, as such agent. Any writ, judgement or other notice
of legal process issued out of the courts in Ireland in
respect of this Agreement shall be sufficiently served on a
Purchaser or Seller if delivered to such agent at its address
for the time being. Each Purchaser and each Seller undertakes
not to revoke the authority of the above agent and if, for any
reason, such agent no longer serves as agent of a Purchaser or
Seller, that Purchaser or Seller shall promptly appoint
another such agent and advise the other parties thereof.
14.8 SURVIVAL AFTER CLOSING: The provisions of this Agreement in so far as
the same shall not have been performed at any Closing shall remain in
full force and effect notwithstanding such Closing.
14.9 COUNTERPARTS: This Agreement may be executed in one or more
counterparts and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an
original but all of which taken together shall constitute one and the
same agreement.
34
35
IN WITNESS WHEREOF the parties have executed this Agreement on the date written
above.
Signed by ___________________________
the duly authorised attorney
of AERFI GROUP PLC
in the presence of:
Signed by ___________________________
the duly authorised attorney
of SKYSCAPE LIMITED
in the presence of:
Signed by ___________________________
for and on behalf
of AERFI INC.
in the presence of:
Signed by ___________________________
for and on behalf
of INDIGO AVIATION AB
in the presence of:
35
36
Signed by ___________________________
for and on behalf
of KOMMANDITBOLAGET FLYGPLANET XII
in the presence of:
Signed by ___________________________
for and on behalf
of AERCO LIMITED
in the presence of:
Signed by ___________________________
for and on behalf
of AERCO USA INC.
in the presence of:
36
37
EXHIBIT A
TO
PURCHASE PRICE ADJUSTMENTS
SHARE PURCHASE AGREEMENT
For each of the first 15 Aircraft which are delivered by the Sellers to the
Purchasers, the allocable amount (Schedule 1 - Column V) which would otherwise
be paid from the Aircraft Purchase Account to or at the direction of the
relevant Sellers for such Aircraft will be reduced pursuant to the Adjustment
Delivery Factor Schedule (Schedule 2) and the principal amount of the E Notes
allocable to such Aircraft (Schedule 1 - Column VII) will be increased by the
amount of such reduction.
In the case of each Aircraft to be delivered by the Sellers to the Purchasers
after delivery of the first 15 Aircraft, the allocable amount to be paid from
the Aircraft Purchase Account to or at the direction of the relevant sellers for
such Aircraft shall be increased, as described in the following paragraph, such
that the cumulative reduction in amounts paid out of the Aircraft Purchase
Account on the delivery of the first 15 Aircraft will be fully recouped over the
delivery of the remaining Aircraft (assuming all 30 Aircraft are delivered) with
a reduction in the aggregate principal amount of the E Notes allocable to those
Aircraft (Schedule 1 - Column VII) of the same amount.
On delivery of each Aircraft delivered after delivery of the first 15 Aircraft,
the allocable amount which would otherwise be paid from the Aircraft Purchase
Account for such Aircraft to or at the direction of the relevant Sellers
(Schedule 1 - Column V) will be increased by an amount which is equal to the
product of (i) the total reduction in the amount payable from the Aircraft
Purchase Account for the first 15 Aircraft as described in the first paragraph
hereof and (ii) a fraction, the numerator of which is that Aircraft's Initial
Appraised Value and the denominator of which is the overall appraised value of
the last 15 Aircraft scheduled to be delivered (assuming all 30 Aircraft will be
delivered) as described in the first paragraph hereof, provided however that an
amount equal to the aggregate amount of the reductions made pursuant to the
first paragraph hereof (net of any Rebates paid as of that date) shall be
transferred from the Aircraft Purchase Account to the Collection Account upon a
Non-Delivery Event described in Clause 7.1(b) of the Share Purchase Agreement or
a Non-Delivery Event described in Clause 7.1(a) of the Share Purchase Agreement
with respect to the last Remaining Aircraft. The E Notes allocable to such
Aircraft (Schedule 1 - Column VII) will be reduced by the same amount.
In no case shall the overall A-E Notes allocable to any Aircraft be more or less
than the relevant Aircraft's appraised value.
37
38
SCHEDULE 1
TO
EXHIBIT A
TO THE
SHARE PURCHASE AGREEMENT
I II III IV V VI VII
------------------ ---------- ------------------- ------------------ ----------------- ----------------- -----------------
AIRCRAFT MSN CURRENT LESSEE APRIL 2000 ALLOCABLE A-C ALLOCABLE D ALLOCABLE E
APPRAISED VALUE NOTE ISSUANCE NOTE ISSUANCE NOTE ISSUANCE
TYPE $'000 $'000 $'000 $'000
------------------ ---------- ------------------- ------------------ ----------------- ----------------- -----------------
A321-200 207 British Midland 52,103,000 42,816,379 1,439,206 7,847,415
B737-300 25041 Virgin Express 23,237,000 19,095,334 642,860 3,499,806
Ireland
F100 11320 TAM 12,783,000 10,504,612 353,096 1,925,292
F100 11322 TAM 12,673,000 10,414,217 350,058 1,908,725
B737-500 25789 British Airways 20,513,000 16,856,849 566,617 3,089,535
B737-300 23345 Delta 14,530,000 11,940,234 401,352 2,188,414
B737-400 27074 Blue Panorama 26,867,000 22,078,338 742,129 4,046,533
B737-400 24901 Blue Panorama 24,597,000 20,212,934 679,426 3,704,640
B737-500 25768 Asiana 22,433,000 18,434,636 619,652 3,378,712
B737-500 24651 Braathens SAFE 18,810,000 15,457,384 519,576 2,833,040
▇▇▇▇-▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 40,420,000 33,215,708 1,116,494 6,087,797
MD-82 49905 Finnair 18,817,000 15,463,137 519,769 2,834,094
MD-82 53245 Finnair 21,103,000 17,341,690 582,914 3,178,397
A320-200 354 Flying Colours 29,980,000 24,636,490 828,117 4,515,392
B737-300 24856 Frontier 21,987,000 18,068,129 607,332 3,311,539
B737-300 26442 Frontier 23,063,000 18,952,347 637,054 3,473,599
A320-200 411 Flying Colours 30,617,000 25,159,954 845,713 4,611,333
B737-400 24270 Virgin Express 22,547,000 18,528,317 622,801 3,395,882
B737-400 24271 Virgin Express 22,987,000 18,889,893 634,954 3,462,152
B737-300 24834 Varig 22,013,000 18,089,495 608,050 3,315,455
B737-300 26440 Frontier 23,483,000 19,297,488 648,655 3,536,857
MD-82 49931 Reno Air 18,953,000 15,574,897 523,526 2,854,578
MD-82 49932 Reno Air 19,340,000 15,892,919 534,216 2,912,865
B757-200 28486 TWA 51,320,000 42,172,938 1,417,578 7,729,484
B737-300C ▇▇▇▇▇ ▇'▇▇▇▇▇▇▇▇▇▇▇ 21,637,000 17,780,512 597,664 3,258,824
B737-500 27153 Xiamen Airlines 20,460,000 16,813,295 565,153 3,081,552
B737-500 27155 Xiamen Airlines 19,943,000 16,388,443 550,872 3,003,685
B737-300 ▇▇▇▇▇ ▇▇▇▇▇ Southern 23,033,000 18,927,694 636,225 3,469,081
MD-82 49570 Spanair 17,180,000 14,117,909 474,552 2,587,540
B737-400 25594 LOT 26,623,000 21,877,828 735,389 4,009,783
------------------ ----------------- ----------------- -----------------
724,052,000 595,000,000 20,000,000 109,052,000
------------------ ----------------- ----------------- -----------------
38
39
SCHEDULE 2
TO
EXHIBIT A
TO THE
SHARE PURCHASE AGREEMENT
Adjustment Delivery Factor For Allocable A-C Notes
AIRCRAFT NUMBER ADJUSTMENT FACTOR FOR ALLOCABLE
A-C NOTES
%
First (10)
Second (10)
Third (10)
Fourth (10)
Fifth (10)
Sixth (10)
Seventh (9)
Eighth (8)
Ninth (7)
Tenth (6)
Eleventh (5)
Twelfth (4)
Thirteenth (3)
Fourteenth (2)
Fifteenth (1)
39
40
EXHIBIT B - MORTGAGE OF SHARES
40
41
EXHIBIT C - MORTGAGE OF MEMBERSHIP INTERESTS
41
42
SCHEDULE 1 - DETAILS RELATING TO THE SHARES
COMPANY SHARES TO BE SOLD
AND SHAREHOLDERS
------------------------------------------------------------------------------
Gustav Leasing I Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing II Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing III Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing IV Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing V Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary share of US$1
------------------------------------------------------------------------------
Gustav Leasing VI Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing VII Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing VIII Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
Gustav Leasing IX Limited AerFi Group plc: 1 Ordinary Share of US$1
Skyscape Limited: 1 Ordinary Share of US$1
------------------------------------------------------------------------------
AerFi BM Limited AerFi Group plc: 1 Ordinary Share of US$1
Changing to Gustav Leasing XII 1 Euro Deferred Share
Limited
Skyscape Limited: 1 Ordinary Share of US$1
1 Euro Deferred Share
changing to:-
AerFi Group plc 2 Ordinary Shares of $1*
Skyscape Limited: 2 Ordinary Shares of $1*
------------------------------------------------------------------------------
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
42
43
COMPANY SHARES TO BE SOLD
AND SHAREHOLDERS
--------------------------------------------------------------------------------
Baltic Airlease III LLC Indigo Aviation AB: Member's interest
of US$20,977,111
Kommanditbolaget Member's interest
Flygplanet XII: of US$211,891
--------------------------------------------------------------------------------
Ergo Leasing Limited AerFi Group plc: 1 Ordinary Share of
Changing to Gustav Leasing XIV IR(pound)1
Limited Skyscape Limited: 1 Ordinary share of
IR(pound)1
--------------------------------------------------------------------------------
Lorenton Limited AerFi Group plc: 1 Ordinary Share of US$1
Changing to Gustav Leasing XIII
Limited Skyscape Limited: 1 Ordinary Share of US$1
1 Euro Deferred Share
changing to:-
AerFi Group plc: 2 Ordinary Shares of $1
Skyscape Limited: 2 Ordinary Shares of $1*
--------------------------------------------------------------------------------
AerFi POL Inc. AerFi Inc: 1,000 shares of common
stock of US$1 each
--------------------------------------------------------------------------------
Baltic Airlease II LLC Indigo Aviation AB: Member's interest of
US$8,538,579.86
Kommanditbolaget Member's interest
Flygplanet XII: of US$86,249.27
--------------------------------------------------------------------------------
Indigo Aviation (Leasing) Limited AerFi Group plc: 2 Ordinary Shares of US$1
--------------------------------------------------------------------------------
Indigo Aviation (Ireland) Limited AerFi Group plc: 1 Ordinary Share of US$1
Changing to Gustav Leasing X
Limited
--------------------------------------------------------------------------------
Aerfi Sverige Leasing AB AerFi Group plc: 1,000 shares of
Swedish Kroner 100 each
--------------------------------------------------------------------------------
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
43
44
SCHEDULE 2 - FURTHER INFORMATION CONCERNING THE COMPANIES
1. GUSTAV LEASING I LIMITED
REGISTERED NUMBER: 328199
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇ ▇▇▇▇,
▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US$1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
44
45
2. GUSTAV LEASING II LIMITED
REGISTERED NUMBER: 328200
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US$1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
45
46
3. GUSTAV LEASING III LIMITED
REGISTERED NUMBER: 328202
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US$1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
46
47
4. GUSTAV LEASING IV LIMITED
REGISTERED NUMBER: 328203
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
47
48
5. GUSTAV LEASING V LIMITED
REGISTERED NUMBER: 328204
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
48
49
6. GUSTAV LEASING VI LIMITED
REGISTERED NUMBER: 328205
REGISTERED OFFICE: Aviation House, Shannon, Co ▇▇▇▇▇
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
49
50
7. GUSTAV LEASING VII LIMITED
REGISTERED NUMBER: 328206
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
50
51
8. GUSTAV LEASING VIII LIMITED
REGISTERED NUMBER: 328207
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
51
52
9. GUSTAV LEASING IX LIMITED
REGISTERED NUMBER: 328208
REGISTERED OFFICE: Aviation House, Shannon, County Clare
INCORPORATION DATE: 2 June 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US $10,000,000 divided into 10,000,000 Ordinary Shares
of US $1 each
ISSUED SHARE CAPITAL: US $2 divided into 2 Ordinary Shares of US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc US $1 Ordinary Share
Skyscape Limited AerFi Group plc US $1 Ordinary Share
52
53
10. ERGO LEASING LIMITED (CHANGING TO GUSTAV LEASING XIV LIMITED)*
REGISTERED NUMBER: 280356
REGISTERED OFFICE: Aviation House, Shannon, Co ▇▇▇▇▇
INCORPORATION DATE: 17 February 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: IR(pound)100,000 divided into 100,000 Ordinary Shares
of IR(pound)1 each changing to IR(pound)100,000 divided into 100,000 Ordinary
Shares of IR(pound)1 each and US$1,000,000 divided into 1,000,000 Ordinary
Shares of US$1 each*.
ISSUED SHARE CAPITAL: IR(pound)2 divided into 2 Ordinary Shares of IR(pound)1
each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 1 Ordinary Share IR(pound)1
Skyscape Limited AerFi Group plc 1 Ordinary Share IR(pound)1
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
53
54
11. INDIGO AVIATION (LEASING) LIMITED (CHANGING TO GUSTAV LEASING XI
LIMITED)*
REGISTERED NUMBER: 311095
REGISTERED OFFICE: Aviation House, Shannon, Co ▇▇▇▇▇
INCORPORATION DATE: 17 August 1999
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US$1,000,000 divided into 1,000,000 Ordinary Shares of
US$1 each
ISSUED SHARE CAPITAL: US$2 divided into 2 Ordinary Shares of US$1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 2 Ordinary Shares US$1
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
54
55
12. INDIGO AVIATION IRELAND LIMITED (CHANGING TO GUSTAV LEASING X LIMITED)*
REGISTERED NUMBER: 273700
REGISTERED OFFICE: Aviation House, Shannon, Co ▇▇▇▇▇
INCORPORATION DATE: 13 October 1997
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: PriceWaterhouseCoopers
▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇'▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US$10,000 divided into 10,000 Ordinary Shares of US$1
each changing to US$1,000,000 divided into 1,000,000 Ordinary Shares of US$1
each*.
ISSUED SHARE CAPITAL: US$1 divided into 1 Ordinary Share of US$1
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 1 Ordinary Share US$1
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
55
56
13. LORENTON LIMITED (CHANGING TO GUSTAV LEASING XIII LIMITED)*
REGISTERED NUMBER: 316793
REGISTERED OFFICE: Aviation House, Shannon, Co ▇▇▇▇▇
INCORPORATION DATE: 10 December 1999
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US$10,000,000 divided into 10,000,000 Ordinary Shares
of US$1 each and Euro 2 divided into 2 Deferred Shares of Euro 1 each changing
to US$10,000,000 divided into 10,000,000 Ordinary Shares of US$1 each.*
ISSUED SHARE CAPITAL: US$2 divided into 2 ordinary shares of US$1 and Euro 2
divided into 2 Euro Deferred Shares changing to US$4 divided into 4 Ordinary
Shares of US$ each.*
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 1 Ordinary Share US$1
Skyscape Limited AerFi Group plc 1 Ordinary Share US$1
AerFi Group plc AerFi Group plc 1 Euro Deferred Share
Skyscape Limited AerFi Group plc 1 Euro Deferred Share
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
56
57
14. AERFI BM LIMITED (CHANGING TO GUSTAV LEASING XII LIMITED)*
REGISTERED NUMBER: 320276
REGISTERED OFFICE: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
INCORPORATION DATE: 9 February 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
SECRETARY: ▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇ ▇▇▇▇▇▇'▇
▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇
AUTHORISED SHARE CAPITAL: US$10,000,000 divided into 10,000,000 Ordinary Shares
of US$1 each and Euro 2 divided into 2 Deferred Shares of Euro 1 each changing
to US$10,000,000 divided into 10,000,000 Ordinary Shares of US$1 each.*
ISSUED SHARE CAPITAL: US$2 divided into 2 Ordinary Shares of US$1 and Euro 2
divided into 2 Euro Deferred Shares changing to US$4 divided into 4 Ordinary
Shares of US$ each.*
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 1 Ordinary Share US$1
Skyscape Limited AerFi Group plc 1 Ordinary Share US$1
AerFi Group plc AerFi Group plc 1 Euro Deferred Share
Skyscape Limited AerFi Group plc 1 Euro Deferred Share
_______________
*Changes to become effective upon passing of resolution, referred to in
Agreement at Clause 3(vii).
57
58
15. AERFI POL INC.
REGISTERED NUMBER:
REGISTERED OFFICE: AerFi Corporation, ▇▇▇ Farm Corporate Park,
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇
INCORPORATION DATE: 23 February 2000
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
SECRETARY: ▇▇▇▇▇ ▇▇▇▇
AUDITORS: KPMG, Chartered Accountants, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇.
AUTHORISED SHARE CAPITAL: US$1,000 divided into 1,000 share of common stock of
US $1 each
ISSUED SHARE CAPITAL: US $1,000 divided into 1,000 share of common stock of
US $1 each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Inc. AerFi Group plc 1,000 shares of
common stock of US$1
each
58
59
16. BALTIC AIRLEASE II LLC
REGISTERED NUMBER: 179L
REGISTERED OFFICE: Penthouse Suite, Analysts House, Peel Road,
Douglas, Isle of Man IM1 4LZ
DATE OF FORMATION
AND ORGANISATION: 2 July 1998
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ (`B' director)
▇▇▇▇ ▇▇▇▇▇▇▇ (`A' director)
MANAGER: ▇▇▇▇▇▇▇ Aviation (Isle of Man) Limited
REGISTERED AGENT: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
AUDITORS: KPMG, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇
CAPITAL: US$8,624,829
MEMBERS BENEFICIAL OWNER MEMBERSHIP INTEREST HELD
Indigo Aviation AB Indigo Aviation AB US$8,538,580
Kommanditbolaget Indigo Aviation AB US$86,249
Flygplanet XII (Limited
Partnership Company)
59
60
17. BALTIC AIRLEASE III LLC
REGISTERED NUMBER: 180L
REGISTERED OFFICE: Penthouse Suite, Analysts House, Peel Road,
Douglas, Isle of Man IM1 4LZ
DATE OF FORMATION AND
ORGANISATION: 2 July 1998
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("B" Director)
▇▇▇▇ ▇▇▇▇▇▇▇ ("A" Director)
MANAGER: Douglas Aviation (Isle of Man) Limited
REGISTERED AGENT ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
AUDITORS: KPMG, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇
CAPITAL: US$21,189,00.000
MEMBERS BENEFICIAL OWNER MEMBERSHIP INTEREST HELD
Indigo Aviation AB Indigo Aviation AB US$20,977,111
(`A' Member)
Kommanditbolaget Indigo Aviation AB US$211,891
Flygplanet XII (Limited
Partnership Company)
(`B' Member)
60
61
18. AERFI SVERIGE LEASING AB
REGISTERED NUMBER: 556579-4186
REGISTERED OFFICE: ▇/▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇,
▇▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
INCORPORATION DATE: 15 November 1999
DIRECTORS: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
AUDITORS: KPMG ▇▇▇▇▇▇▇▇▇▇▇▇ ▇ ▇▇-▇▇▇ ▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇
AUTHORISED SHARE CAPITAL: 100,000 Skr divided into 1,000 Swedish Kroner shares
of 100 SKr each
ISSUED SHARE CAPITAL: 100,000 SKr divided into 1,000 Swedish Kroner shares of
100 SKr each
REGISTERED HOLDER BENEFICIAL OWNER SHARES HELD
AerFi Group plc AerFi Group plc 1,000
61
62
SCHEDULE 3 - REPRESENTATIONS AND WARRANTIES OF SELLERS
PART 1 - GENERAL MATTERS AND MATTERS RELATING TO ALL OF THE COMPANIES
1. SELLERS
Each of the Sellers is duly incorporated or organised and validly
existing under the laws of the jurisdiction of its incorporation or
organisation and each has all necessary power and authority to enter
into this Agreement and the Deed of Tax Indemnity and to carry out its
obligations hereunder and thereunder. The execution and delivery of
this Agreement and the Deed of Tax Indemnity by each Seller and the
performance of its obligations hereunder and thereunder have been duly
authorised by all requisite action on its part. This Agreement and the
Deed of Tax Indemnity have been duly executed and delivered by the
Sellers and (assuming due authorisation, execution and delivery by the
Purchasers) constitute legal, valid and binding obligations of each of
the Sellers.
2. NO CONFLICTS
The entry into and performance by each Seller of this Agreement, and
the transactions contemplated hereby, do not and will not conflict with
or violate:-
(b) the constitutional documents of such Seller or any of the
Companies; or
(c) any laws, rules, regulations, orders, judgements or decrees
binding on such Seller or any of the Companies; or
(d) in any material respect, any material agreement, instrument or
document which is binding upon such Seller or any of the
Companies or any of their respective assets nor result in the
creation of any Lien, other than Permitted Liens, over any of
their assets to be transferred to the relevant Purchaser
hereunder.
3. GOVERNMENT CONSENTS AND APPROVALS
The execution, delivery and performance of this Agreement by each
Seller does not require any material consent, approval, authorisation
or other order of, action by, filing with or notification to any
Governmental Authority, other than (a) such consent, approval,
authorisation or other order, or action by, filing with or notification
to any Governmental Authority that will be made or obtained at or prior
to Closing of the sale of the Shares in the relevant Company or (b) as
described in the Disclosure Letter (as updated pursuant to Clause 12.1
of this Agreement).
4. FULL AND FINAL TRANSFER
The sale of the Shares in the Irish Companies contemplated by this
Agreement shall constitute, following registration in the registers of
members of the Irish
62
63
Companies, a full and final transfer of the legal and beneficial
ownership of the Shares in these Companies to AerCo and/or its
nominee(s) and after Closing of the sale and purchase of these Shares
the relevant Sellers shall retain no right, title or interest therein.
The sale of the Shares in each other Company pursuant to the terms and
conditions of this Agreement shall, following registration of the
relevant Purchaser and/or its nominee(s) in the register of members of
that Company, constitute a full and final transfer of the legal and
beneficial ownership of the right, title and interest of the relevant
Sellers in those Shares to the relevant Purchaser and/or its nominee(s)
and after Closing of the sale and purchase of those Shares the relevant
and/or its nominees shall retain no right, title or interest therein.
5. LITIGATION
No litigation, arbitration or legal, governmental or administrative
proceeding or claim which could reasonably by itself or together with
any other such proceedings or claims:-
(a) have a Material Adverse Effect; or
(b) materially adversely affect any Seller's ability to observe or
perform any of its obligations hereunder or challenge the
legality, validity or enforceability of this Agreement or the
transactions contemplated hereby;
is at present (or as of any Closing) in progress or pending or
threatened in writing against any Seller or any of the Companies (other
than, in the case of proceedings involving the Sellers or any of them,
any which such Seller is contesting in good faith by appropriate
proceedings and in respect of which proper provision has been made)
except as set forth in the Disclosure Letter (as updated pursuant to
Clause 12.1 of this Agreement) which describes the parties, the nature
of the proceedings, the date and method commenced, the amount of
damages or other relief sought and, if applicable, paid or granted.
6. COMPLIANCE WITH LAWS
6.1 None of the Companies has violated any applicable laws or Governmental
Orders in any material respect.
6.2 Save to the extent that same is the responsibility of the Lessee under
the Lease of an Aircraft, each of the Companies has made and is
maintaining all filings and has obtained and is maintaining all
material permits, licences, registrations, qualifications,
authorisations, certificates, exemptions, consents and approvals
necessary to enable it to carry on its business (including in regard to
any environmental matters) (collectively, "PERMITS") the failure to
obtain would give rise to a fine, penalty, claim or other liability or
sanction of or against such Company and all such Permits are in full
force and effect.
7. MATERIAL CONTRACTS
63
64
None of the Companies is party to any contract other than the Aircraft
Purchase Agreements, the Leases (details of which are set out in
Schedule 7 (or have been provided to AerCo prior to the relevant
Closing Date with respect to Substitute Aircraft)) the Company Debt and
Other Transaction Documents and Related Documents;
8. AIRCRAFT
8.1 LIST OF AIRCRAFT
Schedule 7 of this Agreement lists:-
(a) each Aircraft and Engine owned or to be acquired by the
Companies in connection with this Agreement (other than
Substitute Aircraft);
(b) each Lease, and, in the case of the Aircraft with serial
numbers 25789, 24901, 11320, 11322, 24271, 26442, 24856,
26440, 49905, 53245, the head leases and, in the case of the
Aircraft with serial numbers 25789, 24901, 11320, 11322,
24271, 26442, 24856, 26440, 49905, 53245, the sub-leases;
(c) the Initial Appraised Value of each such Aircraft.
No head lease is in effect in respect of any Aircraft other than the
Aircraft with serial numbers 25789, 24901, 11320, 11322, 24271, 26442,
24856, 26440, 49905 and 53245 and no sub-lease is in effect in respect
of any of the Aircraft other than the Aircraft with serial numbers
25789, 24901, 11320, 11322, 24271, 26442, 24856, 26440, 49905 and
53245.
Each Delivery Notice shall contain the information described in this
paragraph 8.1 with respect to the relevant Aircraft.
8.2 TITLE TO ASSETS
Each Company will at the Closing of the sale and purchase of the Shares
in that Company have full legal and beneficial title to each Aircraft
specified in the applicable Delivery Notice free and clear from any
Liens (other than Permitted Liens).
8.3 THE LEASES AND RELATED MATTERS
At Closing of the sale and purchase of the Shares in a Company, the
relevant Seller(s) shall have delivered or shall have caused a copy of
each Lease (and, where applicable, head lease) and related collateral
document to which that Company is party (or to which that Company will
become party on such Closing) to be delivered to or made available to
or held to the order of the relevant Purchaser or the relevant Company.
64
65
(a) Each Lease, and, where applicable, head lease, constitutes the
whole agreement between the parties thereto relating to the
applicable Aircraft other than agreements the existence of
which would not individually or taken together with all other
such agreements in respect of the Leases materially affect the
decision of a reasonable purchaser of the Notes to purchase
Notes;
(b) (i) The Disclosure Letter (as updated pursuant to Clause
12.1 of this Agreement) contains details of any
current Events of Default (as such term is defined in
such Lease) under each Lease and, where applicable,
head lease involving failure by the Lessee to make
any payment when due under such Lease or head lease,
as at 30 June 2000 with respect to Aircraft owned by
Companies the Shares in which are transferred on the
Offering Closing Date, and with respect to Aircraft
owned by any other Company as of a date not more than
five Business Days prior to the applicable Closing
Date of the sale of the Shares in that Company;
(ii) To the knowledge of such Seller(s) no other material
Events of Default under any Lease (or, where
applicable, head lease) (as such term is defined in
such Leases) have occurred and are continuing;
(c) No Event of Loss or Casualty Occurrence under any Lease (as
such terms are defined in such Lease) has occurred;
(d) To the Sellers' knowledge, there are no outstanding claims
which have been validly asserted by any Lessee arising out of
any Lease (or, where applicable, head lease), other than
claims constituting Permitted Liens;
(e) To the Sellers' knowledge, no event has occurred or act or
thing has been done or omitted to be done by any of the
Sellers or the Companies pursuant to which or as a result of
which any of the Leases (or, where applicable, head lease) can
be terminated or obligations of any such party thereunder
would be rendered invalid, illegal or unenforceable;
(f) To the Sellers' knowledge, there are no Aircraft subject to a
Lease with respect to which certificates of airworthiness are
not in force; and, based on the existence of such certificates
of airworthiness, the Sellers have no reason to believe that
any compulsory airworthiness directives are outstanding
against any Aircraft;
(g) No claims for contributions to the cost of compliance with
airworthiness directives pursuant to the terms of any Lease
(or, where applicable, head lease) by the Sellers or the
Companies are outstanding against any Aircraft;
(h) Since the date of the Appraisers' reports, none of the
Aircraft has been involved in any incident which caused damage
in excess of the relevant Damage Notification Threshold (as
defined in the relevant Lease); and
65
66
(i) The rental set out in Schedule 7 (or, in the case of Aircraft
delivered after the Offering Closing Date) in the applicable
Delivery Notice is the current rental payable in respect of
the relevant Aircraft and there are no separate agreements or
understandings with respect to such Aircraft or all of the
Aircraft taken as a whole, which would materially affect the
decision of a reasonable purchaser of the Notes to purchase
the Notes.
9. EMPLOYMENT
None of the Companies has or has ever had any employees.
10. INSURANCES
10.1 The opinion of the Insurance Adviser, with respect to the insurances
maintained by each Company in respect of the Aircraft, Engines and
Parts owned by it on Closing of the sale of the Shares in that Company,
will be delivered by Closing.
10.2 All material assets, properties and risks of the Companies are, and for
the past five years (or, if shorter, since incorporation) have been,
covered by valid and effective insurance policies (including, without
limitation, general liability insurance, property insurance and
political risk insurance) issued in favour of the Companies, as the
case may be, in each case with responsible insurance companies, in such
types and amounts and covering such risks as are consistent with
customary practices and standards of companies engaged in businesses
and operations similar to those of the Companies, as the case may be.
At the time of each Closing, and upon the completion of the
transactions contemplated hereby, all insurance policies required above
will be outstanding and duly in force with respect to the relevant
Company. The Disclosure Letter (as updated pursuant to Clause 12.1 of
this Agreement) sets out a true and complete list of all insurance
policies maintained by or for the Companies other than those which are
referred to in the opinion of the Insurance Advisor. All such insurance
policies are in full force and effect; the Companies have duly paid or
have required Lessees to pay or have otherwise caused to be paid all
premiums accrued thereon and no notice of termination has been received
from any issuer of any such policies.
11. BANK ACCOUNTS
A statement of all bank, deposit or similar accounts of the Companies
and of the credit or debit balance thereon at the Reference Balance
Sheet Date is included in the Disclosure Letter (as updated pursuant to
Clause 12.1 of this Agreement) and the Companies do not maintain any
other accounts with any bank or other lender or deposit taken and there
have been no payments out of any such accounts not reflected therein.
12. RELATIONS WITH SELLER GROUP
None of the Companies has taken part in the management of the affairs
of any members of the Seller Group or has held itself out as being
liable or responsible for any debts or liabilities of any member of the
Seller Group.
66
67
13. COMPANY DEBT
The certificate of Company Debt delivered by AerFi in relation to the
Closing of the sale of the Shares in any Company in accordance with
Clause 2.2 of this Agreement sets out all of the Company Debt owed by
that Company as at the applicable Closing Date.
14. DISCLOSURE OF INFORMATION
14.1 ALL DISCLOSURES MADE
The Sellers are not aware of any facts pertaining to the Companies or
the Aircraft which would result in a Material Adverse Effect or would
affect the decision of a reasonable purchaser of the Notes to purchase
the Notes and which have not been disclosed in (a) this Agreement, (b)
the Disclosure Letter (as updated pursuant to Clause 12.1 of this
Agreement), (c) the Reference Balance Sheets or any related notes,
schedules or auditors reports thereon or (d) have otherwise been
previously disclosed to the Purchasers by the Sellers in writing. None
of the Warranties, or any other warranties of the Sellers in connection
with the transactions contemplated by this Agreement, contains or will
contain any untrue statement of a material fact, or omits or will omit
to state a material fact necessary to make the statements contained
herein or therein not misleading. All information in the Disclosure
Letter (as updated pursuant to Clause 12.1 of this Agreement) is true
and correct in all material respects.
67
68
PART 2 - THE NON-US COMPANIES
1. GENERAL
Each of the Non-US Companies is duly incorporated or, in the case of
Baltic II and Baltic III, duly formed and organised and validly
existing under the laws of the jurisdiction of its incorporation or, as
the case may be, the jurisdiction of its formation and organisation and
has all necessary power and authority to own, operate or lease the
properties and assets now or upon the applicable Closing Date owned,
operated or leased by it and to carry on its business as it has been
and is currently conducted. All corporate actions taken in connection
with this Agreement by the Non-US Companies have been duly authorised
and none of the Non-US Companies has taken any action that in any
respect conflicts with, constitutes a default under or results in a
violation of, any provision of its constitutional documents. True and
correct copies of the certificates of incorporation or, as the case may
be, organisation, and constitutional documents of each of the Non-US
Companies, each as in effect on the date hereof and the applicable
Closing Date, have been delivered by the Sellers to AerCo or to its
order.
2. SHARE CAPITAL
(a) The information relating to each Non-US Company in the
Recitals and Schedules 1 and 2 is and will on Closing of the
sale and purchase of the Shares in that Company be accurate
and complete in all respects. The issued share capital or, as
the case may be, membership interests, of each Non-US Company
is, and will on Closing of the sale and purchase of the Shares
in such Company, be fully paid up and beneficially owned by
the persons set out in the relevant Schedule in the
proportions set out therein;
(b) On Closing of the sale and purchase of the Shares in any
Non-US Company, the relevant Seller(s) will be entitled to
sell and transfer to the relevant Purchaser and/or its
nominee(s) the full legal and beneficial ownership of the
Shares free from any Lien on the terms set out in this
Agreement. Immediately upon such Closing, such Shares will be
legally and beneficially owned by the relevant Purchaser
and/or its nominees and clear of any Liens (other than Liens
in favour of the Security Trustee (as defined in the Notes
Indenture) under the Related Documents); and
(c) Other than the transactions contemplated by this Agreement and
the Other Transaction Documents or Related Documents, there
will be no options or other agreements (including conversion
rights) in force on Closing of the sale and purchase of the
Shares in any Non-US Company which call or may call for the
present or future issue of or accord to any person the right
to call for the issue of any share or loan capital of such
Company and there has been no exercise, purported exercise, or
claim of any charge, lien, encumbrance or equity over any of
the issued or unissued share capital or loan capital of any
such Company.
3. STATUTORY BOOKS
68
69
The register of members and other statutory books of each Non-US
Company are in the possession or held to the order of such Company,
have been properly maintained and contain accurate and complete records
of all matters with which they should deal and do not contain or
reflect any material inaccuracies or discrepancies and no Non-US
Company has received any notice or allegation that any of the foregoing
is incorrect and, in particular, no Non-US Company have received any
notice of any intended application or proceedings to rectify such
register.
4. SUBSIDIARIES
None of the Non-US Companies is the holder or beneficial owner of, or
has agreed to acquire, any share or loan capital of any other body
corporate or is a member of any joint venture or partnership or other
unincorporated association.
5. PURCHASE OF OWN SHARES
Save as disclosed or as may arise in connection with the Related
Documents, none of the Irish Companies has purchased, redeemed or
repaid any share capital or given any financial assistance in
connection with any acquisition of share capital as would fall within
Section 60 of the Companies ▇▇▇ ▇▇▇▇ and Part XI of the Companies ▇▇▇
▇▇▇▇, and none of the other Non-US Companies has purchased, redeemed or
repaid any share capital or membership interests or given any financial
assistance in connection with any acquisition of share capital or
membership interests which would fall within the equivalent provisions,
if any, under the laws of the jurisdiction of its incorporation or, as
the case may be, of its formation and organisation.
6. SHARES
The Minister has not made:
(a) any request under Section 15 of the Companies ▇▇▇ ▇▇▇▇ to any
person in respect of the ownership of the Shares in the Irish
Companies or any of them;
(b) any direction under Section 16 of that Act in respect of the
Shares in the Irish Companies or any of them; or
(c) any direction to any of the Irish Companies under Section
19(1) of that Act.
7. DIRECTORS
(a) The only directors of the Non-US Companies are the persons
whose names are listed in Schedule 2.
(b) In regard to the Irish Companies, no other individual is a
shadow director (within the meaning of Section 27 of the
Companies Act 1990).
69
70
8. COMPANIES FILINGS
All documents relating to the Irish Companies required to be filed with
the Registrar of Companies pursuant to the Companies Acts, 1963 to 1990
and the European Communities (Companies) Regulations 1973, and all
documents relating to the other Non-US Companies which require to be
filed under the equivalent legislation in the jurisdiction of
incorporation or, as the case may be, formation and organisation of
those other Companies, have been duly filed and all statutory records
required to be kept by each Non-US Company have been properly kept and
will be so kept until Closing of the sale and purchase of the Shares in
that Company.
9. MISCELLANEOUS
(a) None of the Non-US Companies has at any time been struck off
the register (or equivalent) maintained by the Registrar of
Companies (or equivalent official) in the relevant
jurisdiction.
(b) None of the Irish Companies has at any time:-
(i) had a notice served on it by its auditors under
Sections 185 or 194 of the Companies ▇▇▇ ▇▇▇▇;
(ii) entered into any transaction or arrangement within
the terms of Section 29 of the Companies ▇▇▇ ▇▇▇▇;
and
(iii) entered into any transaction or arrangement within
the terms of Section 31 of the Companies ▇▇▇ ▇▇▇▇ or
which would, but for Section 32 to 37 of that Act, be
prohibited by Section 31.
10. ACCOUNTS AND BALANCE SHEET
10.1 THE ACCOUNTS
Each of the Non-US Companies was incorporated or formed and organised
on the date specified in the details of that Company set out in
Schedule 2 and no statutory accounts have been prepared in respect of
any of them except as set forth in Schedule 8.
10.2 PRO-FORMA BALANCE SHEETS AND REFERENCE BALANCE SHEETS
(a) The Pro-Forma Balance Sheets represent fairly in all material
respects the financial positions of each of the Non-US
Companies as of 30 June, 2000, had the transfers of shares and
aircraft, and the lease novations, assignments and amendments,
contemplated by the Aircraft Purchase Agreements and the Lease
Novations been completed as at that date, and all the
Remaining Aircraft been transferred to the relevant Remaining
Companies and have been prepared on a basis consistent with
the accounting policies of the Seller Group at such date.
70
71
(b) The Reference Balance sheets do, or will when delivered, with
respect to Remaining Companies represent fairly in all
material respects the financial positions of each of the
Non-US Companies as of the Reference Balance Sheet Date had
the transfers of shares and aircraft, and the lease novations,
assignments and amendments, contemplated by the Aircraft
Purchase Agreements and the Lease Novations been completed as
at that date, and all the Remaining Aircraft been transferred
to the relevant Remaining Companies and have been prepared on
a basis consistent with the accounting policies of the Seller
Group at such date.
10.3 RECORDS
The books of account and other financial records of the Non-US
Companies:-
(a) contain proper records of all matters required to be entered
therein by, in the case of the Irish Companies, the Companies
Acts, 1963 to 1990 and any other Acts or regulations or orders
for the time being in force and, in the case of each other
Non-US Company, the equivalent legislation in the jurisdiction
of its incorporation;
(b) do not contain or reflect any inaccuracies or discrepancies
which will, taken together, have a Material Adverse Effect;
and
(c) have been maintained in accordance with good business and
accounting practices.
10.4 No guarantee has been executed or filed by any of the Irish Companies
with the Registrar of Companies pursuant to Section 17 of the Companies
(Amendment) ▇▇▇ ▇▇▇▇.
10.5 LIABILITIES
There are no Liabilities of any Non-US Company other than (a)
Liabilities (i) reflected or reserved against on the Reference Balance
Sheet of that Non-US Company, (ii) disclosed in the Disclosure Letter
(as updated pursuant to Clause 12.1 of this Agreement) or (iii)
Liabilities (not being Liabilities in respect of borrowed monies)
incurred since the date of the Reference Balance Sheet in the ordinary
course of business and consistent with the past practice of that Non-US
Company and which do not have a Material Adverse Effect or (b) the
Company Debt. Reserves are reflected on the Reference Balance Sheet
against all Liabilities of such Non-US Company in amounts that have
been established on a basis consistent with the past practices of the
Seller Group.
11. COMPETITION LAW
None of the Non-US Companies is or has been a party to, or engaged in,
any agreement, arrangement, decision, concerted practice, or activity
which contravenes the provisions of any competition, anti-trust,
anti-monopoly or anti-cartel law of any jurisdiction, including without
limitation Article 81 of the Treaty of Rome and the provisions of the
Competition ▇▇▇ ▇▇▇▇.
71
72
12. MERGER CONTROL LEGISLATION
None of the Non-US Companies has been involved in any merger or
take-over prior to the date of this Agreement nor been the object of a
report of the Competition Authority under the Irish Mergers and
Take-overs (Control) Acts 1978 to 1996 or the equivalent under the law
of the jurisdiction of its incorporation and none of the Non-US
Companies has been involved in any arrangement or transaction or
agreement which is or was a concentration with a community dimension
within the meaning of Council Regulation (EEC) No. 4064/89 of 21
December 1989 on the control of concentrations between undertakings
(the "MERGER CONTROL REGULATION") and none of the Non-US Companies is
or has been involved prior to or at the date of this Agreement in any
arrangement or transaction or agreement which at the request of a
Member State has been the subject of findings or decisions of the
Commission of the European Communities pursuant to Article 22 of the
Merger Control Regulation.
13. RECEIVERS / EXAMINERS / LIQUIDATORS
(a) No distress, execution or other process has been levied in
respect of any of the Non-US Companies which remains
undischarged and there is no unfulfilled or unsatisfied
judgement or Court order outstanding against any of the Non-US
Companies.
(b) No receiver or manager or special administrator or equivalent
officer has been appointed of the whole or any part of the
assets or undertaking of any of the Non-US Companies.
(c) None of the Non-US Companies is insolvent nor has any of them
stopped or suspended payment of its debts or sought from its
creditors significant extensions of time for the payment of
its debts.
(d) No meeting has been convened at which a resolution will be
proposed, no resolution has been passed, no petition has been
presented and no order has been made for the winding-up of any
of the Non-US Companies.
(e) No arrangement or reconstruction has been proposed under
Section 201 of the Companies ▇▇▇ ▇▇▇▇ in respect of any of the
Irish Companies.
(f) No examiner is, or has been, appointed to any of the Irish
Companies under the Companies (Amendment) ▇▇▇ ▇▇▇▇ and there
is no petition pending or threatened in respect of such an
appointment.
(g) No order has been made or circumstances arisen which could
give rise to any order being made against the Irish Companies
or any of them under Section 140 of the Companies Act, 1990.
(h) None of the Irish Companies has at any time acquired any
property in circumstances which may lead to an application
under Section 139 of the Companies ▇▇▇ ▇▇▇▇ for an order of
the Court on terms contemplated by that Section.
72
73
(i) No event analogous to any of the foregoing has occurred
outside Ireland.
(j) No circumstances have arisen which entitle any person to take
any action, appoint any person, commence proceedings or obtain
any order of the type mentioned in any part of this paragraph
13.
14. TAXATION - IRISH COMPANIES
GENERAL
14.1 All taxation of any nature whatsoever or other sums imposed charged
assessed levied or payable under the provisions of applicable
legislation relating to taxation for which any of the Irish Companies
(which for the purposes of this paragraph 14 means any Company
incorporated in Ireland or resident for tax purposes in Ireland) is
liable as a result of any act or omission by such Company prior to
Closing of the sale of Shares in that Company will if, and in so far as
such taxation or other sums ought to be paid prior to or on Closing,
have been paid at or before Closing and in particular, but, without
prejudice to the generality of the foregoing, at Closing, all amounts
due for payment to the Revenue Commissioners in respect of excise duty
and of Value Added Tax in respect of goods or services supplied prior
to Closing or goods imported prior to Closing will have been paid so
that none of the Irish Companies will have any liability in respect
thereof.
14.2 None of the Irish Companies pays emoluments to its directors.
14.3 None of the Irish Companies has acquired or disposed of any asset or
entered into any transaction otherwise than by way of bargain at arm's
length.
14.4 There is no appeal by any of the Irish Companies pending against any
assessment to tax and none of the Irish Companies is in default in
payment of any tax within the period prescribed for payment thereof.
14.5 None of the Irish Companies has committed any act nor made any omission
which might constitute an offence under Section 1078 of the TCA.
14.6 None of the Irish Companies has been at any time, for taxation
purposes, resident in any jurisdiction other than Ireland nor has it
been at any time managed or controlled in or from any country other
than Ireland and none of the Irish Companies has at any time carried on
any trade in any other country.
14.7 Each of the Irish Companies has for each accounting period up to and
including the accounting period ending on the Reference Balance Sheet
Date furnished such Company's Inspector of Taxes with full and accurate
particulars relating to the affairs of any of the Irish Companies, and
also has properly and within the prescribed periods of time made all
returns and given or delivered all notices, accounts and information
required for the purpose of taxation, and all such notices, accounts
and information have been correct in all material respects and on a
proper basis and no such notices, accounts and information are disputed
by the Revenue Commissioners or other authority concerned, there are no
grounds or circumstances which might cause any such dispute and each of
the Irish
73
74
Companies has made all claims which would be of benefit to it within
the time limits laid down in the relevant legislation.
14.8 To the best of the knowledge and belief of the Sellers, none of the
Irish Companies has entered into or been a party to any schemes or
arrangements designed partly or wholly for the purpose of avoiding
taxation. None of the Irish Companies has been involved in any "tax
avoidance transaction" within the meaning of Section 811 of the TCA and
no provisions of that Section apply to any of the Irish Companies in
respect of any event (whether or not involving any of the Irish
Companies) which took place before the Closing of the sale of the
Shares in that Company or in respect of any series of events (whether
or not such events or any of them involve any of the Irish Companies)
taking place partly before Closing and partly after Closing.
14.9 No act or transaction has been effected in consequence of which any of
the Irish Companies is liable for any taxation primarily chargeable
against some other company.
14.10 The making of returns, payment of preliminary tax and all other
requirements of Part 41 of the TCA have been complied with fully by
each of the Irish Companies.
14.11 No surcharge for late submission of returns under Section 1084 of the
TCA has or will become payable by any of the Irish Companies in respect
of any period prior to Closing of the sale of the Shares in that
Company.
14.12 No notice of attachment has been served on either of the Irish
Companies or in relation to any funds of any of the Irish Companies
under section 1002 of the TCA.
CORPORATION TAX
14.13 (a) None of the Irish Companies has paid remuneration to its
directors; and
(b) None of the Irish Companies has paid or agreed to pay
remuneration or compensation for loss of office or made or
agreed to make any gratuitous payment or any other payment in
respect of management or other services rendered or to be
rendered to any of the Irish Companies to any of its
directors.
14.14 None of the Irish Companies has, within the meaning of Part 18, 1 of
the TCA, received payment in respect of professional services from an
accountable person.
14.15 Each of the Irish Companies has duly complied with the requirements of
Section 239 of the TCA and with the requirements of all other
provisions relating to the deduction and withholding of tax at source
up to the date hereof and all such tax which has become due to the
Revenue Commissioners has been paid to the Revenue Commissioners.
74
75
14.16 The limitation on the meaning of "distribution" provided for by
Sections 133 and 134 of the TCA does not apply to any financial
arrangements of any of the Irish Companies.
14.17 None of the Irish Companies has effected or entered into any acts,
transaction or arrangement of any nature whereby it has incurred or may
hereafter incur any liability under or by virtue of any of Sections 98,
99, 100 and 103 of the TCA.
14.18 None of the Irish Companies is liable to make a subvention payment or
any other payment for an amount surrendered by any other company under
or in connection with the provisions of Section 411 of the TCA.
14.19 None of the Irish Companies has at any time:-
(a) repaid or redeemed or agreed to repay or redeem any shares of
any class of its share capital or otherwise reduced or agreed
to reduce its issued share capital or any class thereof; or
(b) capitalised or agreed to capitalise in the form of shares,
debentures or other securities or in paying up any amounts
unpaid on any shares, debentures or other securities any
profits or reserves of any class or description or passed or
agreed to pass any resolution to do so; or
(c) provided capital to any company on terms whereby the company
so capitalised has in consideration thereof issued shares,
loan stock or other securities where the terms of any such
capitalisation were otherwise than by way of a bargain made at
arm's length or where the shares, loan stock or other
securities acquired are shown in any relevant accounts at a
value in excess of their market value at the time of
acquisition.
14.20 No allowable loss which has arisen or which may hereafter arise on the
disposal by any of the Irish Companies of shares in or securities of
any company is liable to be disallowed in whole or in part by virtue of
the application of Section 621 or Section 622 of the TCA.
14.21 No change of ownership of any of the Irish Companies has taken place in
circumstances such that Section 401 of the TCA has or may be applied to
deny relief for a loss or losses incurred by any of the Irish
Companies.
14.22 The restrictions on the use of capital allowances for certain leased
assets as set out in Section 403 of the TCA do not have application to
any transactions entered into by any of the Irish Companies.
14.23 None of the Irish Companies has received notice under Section 445(4) or
(5) of the TCA and AerFi has not received notice under section 445(4)
or (5) of the TCA in respect of any certificate relevant to, or the
revocation of which would adversely affect, the Irish Companies.
14.24 The provisions of Section 1013 of the TCA do not apply to any
transaction entered into by any of the Irish Companies.
75
76
14.25 None of the Irish Companies has entered into any transaction as a
result of which it could be assessed to tax under Part 22, Chapter 1 of
the TCA.
14.26 No allowance in respect of capital expenditure is or may be restricted
by virtue of Part 9 of, or paragraph 9 of Schedule 32 to, the TCA.
14.27 None of the Irish Companies has entered into or taken any steps the
object of which is a transaction which comes or may come within Section
817 of the TCA.
14.28 None of the Irish Companies beneficially owns nor has it ever
beneficially owned shares to which Sections 155 and 489(14) of the TCA
apply or may have applied.
14.29 None of the Irish Companies owns or has ever owned an asset which
constitutes a material interest in an off-shore fund which is or has at
any time been a non qualifying off-shore fund within the terms of Part
27, Chapter 2 of the TCA.
ADVANCE CORPORATION TAX ("ACT")
14.30 None of the Irish Companies has any liability to ACT under Part 6,
Chapter 8 of the TCA.
14.31 None of the Irish Companies has made an election under Section 165, and
no surrender has been made under Section 166, of the TCA.
14.32 None of the Irish Companies is affected by the provisions of Section
167 or Section 170 of the TCA.
CAPITAL GAINS TAX
14.33 None of the Irish Companies has made any claim under Section 597 of the
TCA as respects the consideration for the disposal of or of its
interest in any assets which are defined in the said Section 28
(amended as aforesaid) as "the old assets".
14.34 None of the Irish Companies has made any such transfer as is referred
to in Section 589 of the TCA or received any asset by way of gift as
mentioned in Section 987 of the TCA.
14.35 None of the Irish Companies has been a party to or involved in any
share for share exchange nor any scheme of reconstruction or
amalgamation such as are mentioned in Sections 583 to 588 or 615 of the
TCA under which shares or debentures have been issued or any transfer
of assets effected.
14.36 None of the Irish Companies has entered into any transaction which has,
will or may give rise to a charge to tax under the provisions of the
TCA relating to companies' capital gains or under the provisions of the
Capital Acquisitions Tax ▇▇▇ ▇▇▇▇.
14.37 None of the Irish Companies has made any claim under Section 1005 of
the TCA and no tax liability has been deferred under any other
provision of the TCA including Sections 563 and 981.
76
77
14.38 None of the Irish Companies has entered into any transactions which
give rise to a liability under Sections 590(11), 616, 623, 625 or 626
of the TCA.
14.39 There have been no claims under Section 538(2) of the TCA.
14.40 None of the Irish Companies has entered into or taken any steps the
object of which is a transaction which comes within or might come
within Section 549 of the TCA.
STAMP/CAPITAL DUTY
14.41 All documents in the possession or under the control of any of the
Irish Companies which attract stamp duty have been properly stamped.
14.42 No relief, exemption or reduction has been obtained from Irish
Companies capital duty or stamp duty and without prejudice to the
generality of the foregoing no relief, exemption or reduction has been
obtained from Irish Companies capital duty or stamp duty under Section
119 of the Stamp Duty Consolidation Act, 1999 (the "1999 Act") or from
stamp duty under Section 80 of the 1999 Act which (a) has become liable
to forfeiture or (b) may be forfeited in the future.
14.43 All capital duty and/or stamp duty payable by any of the Irish
Companies in respect of any of the transactions referred to in the
following sections of the 1999 Act has been duly and promptly paid by
such Company so that there is no liability in respect thereof or any
interest thereon;
(a) section 58;
(b) section 166; and
(c) sections 117 and 118.
14.44 All other capital and/or stamp duty howsoever arising or payable has
been paid by each of the Irish Companies and there is no outstanding
liability therefor or interest thereon.
VALUE ADDED TAX
14.45 Each of the Irish Companies is a registered and taxable person for the
purposes of the Value Added Tax Acts and has complied in all respects
with such legislation and all regulations made or notices issued
thereunder and has maintained full complete correct and up to date
records, invoices and other documents (as the case may be) appropriate
or requisite for the purposes thereof.
14.46 None of the Irish Companies is in arrears with its payments or returns
or notifications under the Value Added Tax Acts regulations or notices
or liable to any abnormal or non routine payment or any forfeiture or
penalty or to the operation of any penal provisions contained therein.
14.47 None of the Irish Companies has been required by appropriate fiscal
authorities to give security under the Value Added Tax Acts.
77
78
14.48 No arrangement exists or has existed whereby pursuant to Section 8(8)
of the Value Added Tax ▇▇▇ ▇▇▇▇ and Regulation 5 of the Value Added Tax
Regulation 1979 (as amended) the business activities of any of the
Irish Companies are or were deemed to be carried on by any other person
or the business activities of any other person are or were deemed to be
carried on by any of the Irish Companies.
CAPITAL ACQUISITIONS TAX
14.49 There is no unsatisfied liability to capital acquisitions tax attached
or attributable to the Shares and the Shares are not subject to a
charge in favour of the Revenue Commissioners.
14.50 No person is liable to capital acquisitions tax attributable to the
value of any of the Shares and in consequence no person has the power
to raise the amount of such tax by sale or mortgage of or by a
terminable charge on any of the Shares.
14.51 None of the Irish Companies has entered into or taken any steps the
object of which is a transaction which comes within Section 90 of the
Finance ▇▇▇ ▇▇▇▇.
15. TAXATION - OTHER NON-US COMPANIES
In respect of each of the Non-US Companies (other than the Irish
Companies), the statements in paragraph 14 are true and accurate as
though references therein to the Irish Companies were to each of those
other Non-US Companies and references to specific provisions of Irish
statutes or regulations were references to the equivalent statutes or
regulations in the jurisdiction of incorporation or organisation of
those other Non-US Companies.
78
79
PART 3 - AERFI POL
1. ORGANISATION, AUTHORITY AND QUALIFICATION
AerFi POL is a corporation duly organised, validly existing and in good
standing under the laws of the State of Delaware and has all the
necessary power and authority to own, operate or lease the properties
and assets now owned, operated or leased by it and to carry on its
business as it has been and is currently conducted. AerFi POL is duly
licensed or qualified to do business and is in good standing in each
jurisdiction in which the properties owned or leased by it or the
operation of its business makes such licensing or qualification
necessary and all such jurisdictions are set forth in the Disclosure
Letter (as updated pursuant to Clause 12.1 of the Agreement). All
corporate actions taken in connection with this Agreement by AerFi POL
have been duly authorised, and AerFi POL has not taken any action that
in any respect conflicts with, constitutes a default under or results
in a violation of any provision of its certificate of incorporation or
by-laws. True and correct copies of the certificate of incorporation
and by-laws of AerFi POL, each as in effect on the date hereof and the
applicable Closing Date, have been delivered by AerFi to the
Purchasers.
2. AERFI POL STOCK
The authorised capital stock of AerFi POL consists of 1,000 shares of
common stock of US $1 each. As of the date hereof and the applicable
Closing Date, 1,000 shares of common stock (the "AERFI POL STOCK") of
US $1 each are issued and outstanding, all of which are validly issued,
fully paid and non-assessable. None of the issued and outstanding
shares of common stock was issued in violation of any pre-emptive
rights. There are no options, warrants, convertible securities or other
rights, agreements, arrangements or commitments of any character
relating to the capital stock of AerFi POL or obligating AerFi or AerFi
POL to issue or sell any shares of capital stock of, or any other
interest in, AerFi POL. There are no outstanding contractual
obligations of AerFi POL to repurchase, redeem or otherwise acquire any
shares of its common stock. The AerFi POL Stock constitutes all the
issued and outstanding capital stock of AerFi POL and is owned of
record and beneficially solely by AerFi Inc. free and clear of all
Liens, and at Closing of the sale of the AerFi POL Stock, AerFi Inc.
will transfer and deliver to AerCo USA, and/or its nominee(s), as the
case may be, the legal and beneficial ownership of the right, title and
interest in the AerFi POL Stock free and clear of all Liens (other than
Liens in favour of the Security Transfer (as defined in the Notes
Indenture) under the Related Documents). Immediately upon Closing of
the sale and purchase of the AerFi POL Stock, the AerFi POL Stock will
be fully paid, non-assessable and will be legally and beneficially
owned by AerCo USA (and/or its nominee(s), as the case may be) free and
clear of all Liens (other than Liens in favour of the Security Trustee
(as defined in the Notes Indenture)). There are no voting trusts,
stockholder agreements, proxies or other agreements or understandings
in effect with respect to the voting or transfer of any of the AerFi
POL Stock.
The stock register of AerFi POL accurately records: the name and
address of each person owning shares of capital stock of AerFi POL, and
the certificate number of each certificate evidencing shares of capital
stock issued by ▇▇▇▇▇
▇▇
▇▇
▇▇▇, the number of shares evidenced by each such certificate, the date
of issuance thereof and, in the case of cancellation, the date of
cancellation.
3. SUBSIDIARIES
AerFi POL has no Subsidiaries.
4. CORPORATE BOOKS AND RECORDS
Complete and accurate copies of the minute books and of the stock
register of AerFi POL have been provided by AerFi Inc. to AerCo. All
statutory records required to be kept by AerFi POL have been properly
kept and will be so kept until the Closing of the sale of the AerFi POL
Stock.
5. FINANCIAL INFORMATION, SOLVENCY, BOOKS AND RECORDS ETC
(a) The Pro-Forma Balance Sheet of AerFi POL represents fairly in
all material respects the financial position of AerFi POL as
of 30 June, 2000 had the transfers of shares and aircraft, and
the lease novations, assignments and amendments, contemplated
by the Aircraft Purchase Agreements and the Lease Novations
been completed as at that date, and all the Remaining Aircraft
been transferred to the relevant Remaining Companies and have
been prepared on a basis consistent with the accounting
policies of the Seller Group at such date.
(b) No audited accounts have been prepared in respect of AerFi
POL. The Reference Balance Sheet represents fairly in all
material respects the financial position of AerFi POL at the
Reference Balance Sheet Date and has been prepared on a basis
consistent with the accounting policies of the Seller Group at
the Reference Balance Sheet Date.
(c) AerFi POL is Solvent.
(d) The books of account and other financial records of AerFi POL:
(i) reflect all items of income and expense and all assets and
Liabilities required to be reflected therein in accordance
with and applied on a basis consistent with the past practices
of the Seller Group's U.S. members, (ii) are complete and
correct, and do not contain or reflect any material
inaccuracies or discrepancies and (iii) have been maintained
in accordance with good business and accounting practices.
6. NO UNDISCLOSED LIABILITIES.
There are no Liabilities of AerFi POL other than (a) Liabilities (i)
reflected or reserved against on its Reference Balance Sheet, (ii)
disclosed the Disclosure Letter (as updated pursuant to Clause 12.1 of
this Agreement) or (iii) Liabilities (not being Liabilities in respect
of borrowed monies) incurred since the Reference Balance Sheet Date in
the ordinary course of business and consistent with the past practice
of Seller Group's U.S. members and which do not have a Material Adverse
Effect and (b) the Company Debt. Reserves are reflected on
80
81
the Reference Balance Sheet against all Liabilities of AerFi POL in
amounts that have been established on a basis consistent with the past
practices of the Seller Group's U.S. members.
7. CONDUCT IN THE ORDINARY COURSE: ABSENCE OF CERTAIN CHANGES, EVENTS AND
CONDITIONS.
Since the Reference Balance Sheet Date, the business of AerFi POL has
been conducted in the ordinary course and consistent with past practice
and AerFi POL has not suffered any change or occurrence which would be
reasonably expected to result in a Material Adverse Effect.
8. IDENTITY OF DIRECTORS
The details of the directors and officers of AerFi POL set out in
Schedule 2 are correct.
9. AERFI POL TAX REPRESENTATIONS
(a) all tax returns, statements, reports and forms (including
estimated tax or information returns and reports) required to
be filed with any taxing authority with respect to any
pre-closing tax period by or on behalf of AerFi POL
(collectively, the "RETURNS") have, to the extent required to
be filed on or before the date hereof been or will be filed
when due in accordance with all applicable laws; (b) as of the
time of filing, the Returns, if any, correctly reflected (and,
as to any Returns not filed as of the date hereof, will
correctly reflect) the facts regarding the income, business,
assets, operations, activities and status of AerFi POL and any
other information required to be shown therein; (c) all taxes
shown as due and payable on the Returns that have been filed,
if any, have been timely paid, or withheld and remitted to the
appropriate taxing authority; (d) AerFi POL is not delinquent
in the payment of any tax and has not requested any extension
of time within which to file any Return which has not yet been
filed; (e) AerFi POL has not granted any extension or waiver
of the statute of limitations period applicable to any Return,
which period (after giving effect to such extension or waiver)
has not yet expired; (f) there is no claim, audit, action,
suit, proceeding or investigation now pending or threatened
against or with respect to AerFi POL in respect of any tax.
81
82
SCHEDULE 4 - PURCHASERS' REPRESENTATIONS AND WARRANTIES
1. CAPACITY AND AUTHORITY
1.1 PURCHASERS
Each Purchaser is duly incorporated and validly existing under the laws
of the jurisdiction of its incorporation and has all necessary
corporate power and authority to enter into and perform its obligations
under this Agreement which constitute legal, valid, binding obligations
of such Purchaser enforceable in accordance with its terms. The
execution, delivery and performance by each Purchaser of this Agreement
has been duly authorised by all requisite action on its part. This
Agreement has been duly executed and delivered by each Purchaser and
(assuming due authorisation, execution and delivery by the Sellers)
this Agreement constitutes a legal, valid and binding obligation of
each Purchaser enforceable against it in accordance with its terms.
1.1 NO CONFLICTS
Assuming the making and obtaining of all filings, notifications,
consents, approvals, authorisations and other actions referred to in
paragraph 1.4 below, except as may result from any facts or
circumstances relating solely to the Sellers, the execution, delivery
and performance of this Agreement by each Purchaser does not and will
not:-
(a) violate, conflict with or result in the breach of any
provision of any constitutional document of such Purchaser,
which conflict with or breach would materially impair the
Purchasers' ability to perform their respective obligations
under this Agreement;
(b) conflict with or violate any Law or Government Order
applicable to such Purchaser, which conflict or violation
would materially impair the ability of the Purchasers to
perform their respective obligations under this Agreement; or
(c) conflict, result in any breach of, constitute a default (or
event which with the giving of notice or lapse in time or both
would become a default) under, or result in the creation of
any Lien on any of the assets or properties of either
Purchaser pursuant to any note, bond, mortgage, or indenture,
contract, agreement, lease, sublease, license, permit,
franchise or other instrument or arrangement to which such
Purchaser is a party or by which any of its assets or
properties are bound or affected, which conflict, breach or
default would materially impair the Purchasers' ability to
perform their respective obligations under this Agreement.
1.1 GOVERNMENT CONSENTS AND APPROVALS
82
83
The execution, delivery and performance by each Purchaser of this
Agreement does not and will not require any consent, approval,
authorisation or other order of, action by, filing with or notification
to any governmental authority, except as described in writing given to
the Sellers by the Purchasers on or prior to Closing.
2. PURCHASE FOR INVESTMENT
The Purchasers are buying the Shares for investment for their own
account and not with a view to, or for sale in connection with, any
distribution thereof.
3. LITIGATION
There is no action, suit, investigation or proceeding pending against,
or to the knowledge of the Purchasers, threatened against or affecting,
either Purchaser before any court or arbitrator or any governmental
body, agency or official which in any manner challenges or seeks to
prevent, enjoin, alter or materially delay the transactions
contemplated by this Agreement and the Other Transaction Documents or
the Related Documents.
4. NO IMPLIED WARRANTIES
The Purchasers have not relied upon any express or implied warranties
of any nature made by or on behalf of or imputed to the Sellers except
as expressly set out in this Agreement.
5. TRANSFER
The Purchasers intend that the sale of the Shares in each Company
contemplated hereby shall constitute a full and final transfer of the
legal and beneficial ownership of the Shares in that Company and after
the applicable Closing the relevant Sellers shall retain no right,
title or interest in the Shares transferred at such Closing.
83
84
SCHEDULE 5 - DEED OF TAX INDEMNITY
THIS DEED OF INDEMNITY is made on 2000
BETWEEN
(A) AERFI GROUP PLC ("AERFI"), a public limited company incorporated in
Ireland and having its registered office at Aviation House, Shannon, Co
Clare, Ireland, SKYSCAPE LIMITED ("SKYSCAPE"), a limited liability
company incorporated in Ireland and having its registered office at
Aviation House, Shannon, Co ▇▇▇▇▇, Ireland, AERFI INC. a corporation
incorporated in the State of Delaware and having its principal place of
business at ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
("AERFI INC"), INDIGO AVIATION AB ("INDIGO AVIATION"), a company
incorporated under the laws of Sweden and having its principal place of
business at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ and
KOMMANDITBOLAGET FLYGPLANET XII, ("KB FLYGPLANET") a limited
partnership established under the laws of Sweden and having its
principal place of business at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇ ▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ (each a "COVENANTOR" and together the "COVENANTORS"); and
(B) AERCO LIMITED ("AERCO"), a company incorporated in Jersey and having
its registered office at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇
▇▇▇, Channel Islands and AERCO USA INC. ("AERCO USA"), a corporation
incorporated in the State of Delaware and having its principal place of
business at Nationwide Information Services Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (each a "PURCHASER" and together the "PURCHASERS",
which expression shall unless the context does not so permit include
successors in title).
RECITALS
By Share Purchase Agreement dated 17 July 2000 between the Covenantors and the
Purchasers (the "AGREEMENT"), the Purchasers agreed to purchase, and the
Covenantors agreed to sell, all of the issued shares and outstanding membership
interests (the "SHARES") in the capital of the Companies (as defined below) in
the manner and on the terms set out in the Agreement. The Covenantors have
agreed to indemnify the Purchasers in respect of certain tax liabilities of the
Companies as purchased on the terms and conditions contained herein.
NOW IT IS AGREED as follows:-
1. INTERPRETATION
1.1 DEFINITIONS: In this Deed unless the context otherwise requires:-
"AERFI POL" means AerFi POL Inc;
"CLOSING" means, in relation to a Company, completion of the sale and
purchase of the Shares in that Company in accordance with the
Agreement;
"COMPANIES" means the companies set out in Schedule 2 to the Agreement;
"CLAIM" includes any demand, notice, letter or other document issued or
action taken by or on behalf of any person or authority (whether within
or outside
84
85
Ireland) from which it appears that any Company is liable or is sought
to be made liable to make any payment or a tax liability is likely to
be imposed on any Company;
"LIBOR" means the per annum offered rate for deposits in US dollars for
a period of one month that appears on the display designated as page
3750 on the Telerate Monitor (or such other page or service as may
replace it for the purpose of displaying LIBOR of major banks for US
dollar deposits) at approximately 11:00 am (London time);
"TAX ASSESSMENT" includes any assessment demand or other similar formal
notice of a tax liability issued by or on behalf of any taxing or other
competent authority or estimates and amounts which are due and payable
without any formal demand or notice by or on behalf of any taxing or
other competent authority (whether within or outside Ireland) by virtue
of which any Company is or will with the passing of time become liable
to make a payment of tax;
references to any tax liability of any Company shall include not only
liabilities of the Company to make payments of or in respect of tax but
also:-
(a) the loss or setting off against income profits or gains of any
relief, allowance or credit in respect of any tax which would
(were it not for the said loss or setting off) have been
available to the Company and has been taken into account in
computing (and so reducing) any provision for deferred
taxation which appears (or which but for such relief allowance
or credit would have appeared) in the Reference Balance Sheet;
(b) the loss or setting off against any tax liability (for which
no provision has been made in preparing the Reference Balance
Sheet) of a right to repayment of tax which has been treated
as an asset of the Company in preparing the Reference Balance
Sheet; and
(c) the setting off against income profits or gains earned accrued
or received on or before Closing of any relief, allowance or
credit which is not available before Closing but arises in
respect of any event occurring after Closing in circumstances
where, but for such setting off, the Company would have had an
actual tax liability in respect of which it or the Purchasers
would have been able to make a claim against the Covenantor
under this Deed and in such a case the amount of the relief
allowance or credit so lost or set off (or if such relief
allowance or credit is a deduction from or offset against
gross income or profits the amount of tax which would (in the
case of a lost relief allowance or credit and on the basis of
the tax rates current at the date of such loss) have been
saved thereby but for such loss or in the case of a set off,
relief, allowance or credit the amount of tax which has been
saved thereby in consequence of such set off) or the amount of
the repayment which would otherwise have been obtained shall
be treated for the purposes of this Deed as a tax liability of
the Company;
"TAX" includes (without prejudice to the generality of the
expression):-
85
86
(d) within Ireland, all taxes including (without limitation)
income tax, corporation tax (including any additional duty of
corporation tax and any surcharge), advance corporation tax,
capital gains tax, capital acquisition tax, value added tax,
stamp duty, capital duty, excise duty, customs and other
import duties, PAYE deductions, pay related social insurance
(PRSI) social welfare and social insurance contributions,
payroll taxes generally, general rates and water rates,
withholding tax, deposit interest retention tax and any other
tax, levy, duty or impost whether similar to, replaced by or
replacing any of them or otherwise and any penalty, charge and
interest included in or relating to any tax assessment
therefor; and
(e) outside Ireland all taxes including (without limitation) taxes
on gross or net income profits or gains, receipts, sales, use,
occupation, franchise, value added, personal property and any
other tax, levy, impost, excise duty, duty, charge or
withholding of any nature whatsoever, PAYE deductions, payroll
taxes and contributions generally and any penalty, charge and
interest included in or relating to any tax assessment
therefor, in either case regardless of whether such taxes
penalties, charges and interest are directly or primarily
chargeable against or attributable to any Company or any other
person, firm or company;
References to:-
(i) income or profits or gains earned, accrued or received on or
before a particular date or in respect of a particular period
shall include income or profits or gains which have been
deemed to have been earned, accrued or received at or before
that date or in respect of that period for the purposes of any
tax assessment;
(ii) any payment or distribution made on or before a particular
date shall include:
(A) any payment or distribution which on or before that
date has fallen due to be made; and
(B) any act or transaction which has occurred on or
before that date and is or has been deemed to be a
payment or distribution for the purposes of any tax
assessment; and
(iii) any dividend shall include anything which has been deemed to
be a dividend or distribution to shareholders or others for
the purposes of any tax assessment;
"EVENT" includes (without limitation) the death of any person, any
transaction action or omission and a failure to make sufficient
dividend payments to avoid any apportionment or deemed distribution of
income or notional and deemed events which give rise to tax liabilities
or an additional duty of corporation tax or overcharge; and
86
87
1.2 TERMS DEFINED IN THE AGREEMENT: Unless otherwise indicated, words and
expressions used but not defined in this Deed shall have the same
meaning as in the Agreement.
2. INDEMNITY
2.1 NATURE OF INDEMNITY: The Covenantors hereby jointly and severally
covenant to hold each Purchaser (without prejudice to any other rights
which that Purchaser may have) indemnified and to keep each Purchaser
indemnified against:-
(a) any claim for tax on and any tax liability of any Company
purchased by it under the Agreement arising:-
(i) as a consequence of any event which occurred on or
before the Closing of the sale of the Shares in that
Company; or
(ii) in respect of or with reference to any income,
profits or gains which were earned accrued or
received on or before or in respect of a period
ending on or before the Closing of the sale of the
Shares in that Company;
(b) any claim for tax on and any tax liability of any Company
purchased by it under the Agreement resulting from or made by
reference to any of the following events:-
(i) the disposal of any asset (including trading stock)
in circumstances where the cash consideration
actually received for such disposal is less than the
consideration deemed to have been received for
taxation purposes; or
(ii) the supply of any service or business facility of any
kind for a consideration which was less than might
reasonably have been regarded as the open market
value of such service or business facility; or
(iii) any other act or transaction which gives rise to a
tax liability on deemed (as opposed to actual)
income, profits or gains by the operation of the Tax
Acts (as defined in section 1(2) of the Taxes
Consolidation Act, 1997) or which results in such
Company becoming liable to pay or bear a tax
liability directly or primarily chargeable against or
attributable to another person firm or company (other
than a Company) but only where the relevant event
occurred on or before Closing of the sale of the
Shares in that Company; and
(c) any interest and any costs and expenses reasonably and
properly incurred by the relevant Purchaser and the relevant
Company in connection with any such liability (or claim
therefor) or in taking or defending any action under this
Deed.
3. LIMITATIONS ON INDEMNITY
87
88
3.1 CERTAIN TAX LIABILITIES EXEMPTED: The indemnity given by Clause 2 of
this Deed shall not cover any tax liability:-
(a) to the extent that provision or reserve in respect of such tax
liability was made in the Reference Balance Sheets; or
(b) to the extent that the liability of the Covenantors arising by
reason of any claims hereunder when aggregated to the
liability of the Covenantors and their Affiliates in respect
of any claims under or pursuant to (i) the Warranties, (ii)
the Seller Indemnity (iii) the Aircraft Purchase Agreements
and/or (iv) the Agreement would exceed US$175 million at the
time payment of such amount is made; or
(c) to the extent that the aggregate liability of the Covenantors
and their Affiliates for such claims when aggregated with any
liability of the Covenantors and/or such Affiliates in respect
of claims under or pursuant to (i) the Warranties and (ii) the
Seller Indemnity would not exceed in aggregate US$4.25
million; or
(d) to the extent that the relevant Purchaser waives or surrenders
after Closing any exemption, relief, allowance, credit,
deduction or set-off available to the Company at the date
hereof or at the Closing Date relevant to the computation of
any liability to taxation or any credit against taxation; or
(e) with respect to and to the extent attributable to the passing
of any primary or subordinate legislation or any judicial
decision altering the generally accepted interpretation of
existing legislation or making of any other government
regulation, not in force at the date hereof, or the withdrawal
or alteration after the date hereof of any published or
unpublished extra statutory concession made by any fiscal
authority and presently in operation; or
(f) which would not have arisen but for (or if the same is
increased by reason of) a breach by either Purchaser of its
obligations hereunder; or
(g) which would not have arisen but for a voluntary act or
transaction not contemplated by this Deed, the Agreement, the
Other Transaction Documents or the Related Documents (as
defined in the Notes Indenture) carried out by the Company
after Closing and otherwise than in the ordinary course of
business.
3.2 LIABILITY OF SKYSCAPE: The Purchasers hereby acknowledge that Skyscape
is a party to this Deed in its capacity only as holder of shares in the
Irish Companies as nominee for AerFi. Skyscape's maximum liability to
the Purchasers in respect of any claims under or pursuant to this Deed
shall be limited to IR(pound)1.
3.3 LIABILITY OF KB FLYGPLANET: The Purchasers hereby acknowledge that KB
Flygplanet is a party to this Deed in its capacity only as holder of
Membership interests in Baltic II and Baltic III, as a nominee of
Indigo Aviation. KB
88
89
Flygplanet's maximum liability to the Purchasers in respect of any
claims under or pursuant to this Deed shall be limited to IR(pound)1.
4. CLAIMS
4.1 NOTICE BY PURCHASERS: TIME LIMIT ON CLAIMS: No claim shall be brought
by either Purchaser in respect of any claim under this Deed unless
notice in writing of such claim (specifying in reasonable detail (a)
the event matter or default which gives rise to the claim and (b) the
amount claimed) has been given to the Covenantors not later than 17
July 2007. Upon the relevant Purchaser or any Company becoming aware of
such a claim, the Purchaser shall or shall pursue that the Relevant
Company shall forthwith give written notice thereof to the Covenantors
and shall (if the Covenantors shall indemnify and secure the Company to
its reasonable satisfaction against all losses, costs, damages and
expenses including interest on overdue tax which may be incurred
thereby) take such action as the Covenantors may reasonably and
promptly by written notice request to avoid, resist, appeal or
compromise the claim, provided that the Company shall not be obliged to
appeal against any tax assessment raised on it if having given the
Covenantors written notice of the receipt of such tax assessment it has
not within 15 days thereafter received instructions in writing from the
Covenantors in accordance with the preceding provisions of this
sub-clause to do so.
5. INTEREST
LATE PAYMENT TO CARRY INTEREST: If any payment due to be made by the
Covenantors under this Deed is not made on the due date for payment
thereof the same shall carry interest from such due date of payment
until actual payment at the rate of 1 per cent per annum above LIBOR.
6. PAYMENTS
6.1 TO BE MADE FREE FROM DEDUCTIONS: All sums payable by the Covenantors to
the Purchasers under this Deed shall be paid free and clear of all
deductions or withholdings whatsoever save only as may be required by
law. If any such deductions or withholdings are required by law the
Covenantors shall be obliged to pay to the relevant Purchaser such sums
as will after such deduction or withholding has been made leave the
Purchaser with the same amount as they would have been entitled to
receive in the absence of any such requirement to make a deduction or
withholding. If any sum payable by the Covenantors to the relevant
Purchaser under this Deed shall otherwise be subject to tax in the
hands of the relevant Purchaser the same obligation to make an
increased payment shall apply in relation to such tax liability as if
it were a deduction or withholding required by law. The Purchasers and
the Covenantors hereby undertake to co-operate to avoid or to minimise
any such grossing up where possible at no extra cost to the Purchasers
or the Covenantors.
6.2 RECOVERY FROM THIRD PARTIES: If either Purchaser recovers any sum from
a third party in respect of or relating to a tax liability which has
been the subject of a successful claim by such Purchaser against any of
the Covenantors or their
89
90
Affiliates hereunder, such Purchaser shall forthwith reimburse to the
Covenantors an amount equal to the sum recovered in respect of that
claim.
7. RIGHTS OF PURCHASERS
RIGHT OF PURCHASERS TO RELEASE COVENANTORS: The Purchasers and the
Companies may release or compromise the liability of any of the
Covenantors hereunder or grant to any Covenantor time or other
indulgences without affecting the liability of any other Covenantor
hereunder.
8. NOTICES
MANNER OF SERVICE: Any notice or demand given under this Deed shall be
in writing and shall be deemed to be duly served if left at or sent by
registered post to the address of the appropriate party set out above
or such other address in Ireland as such party may from time to time
notify to the other parties for the purposes of this Deed. Any such
notice or demand shall be deemed to be given at the time when the same
is left at the said address or if sent by registered post at the
commencement of the fifth business day after the day of posting.
9. COUNTERPARTS
This Deed maybe executed in any number of counterparts, all of which
taken together shall constitute one and the same instrument. Any party
may enter into this Deed by executing any such counterpart.
10. GOVERNING LAW
LAW OF IRELAND TO APPLY: This Deed shall be governed by and construed
in accordance with the law of Ireland and each of the parties hereto
submits to the non-exclusive jurisdiction of the Courts of Ireland.
90
91
IN WITNESS WHEREOF the parties
have executed this Deed on the date
written above.
Present when the Common Seal
of AERFI GROUP PLC
was affixed hereto
Present when the Common Seal
of SKYSCAPE LIMITED
was affixed hereto
SIGNED BY
______________________
for and on behalf of
AERFI INC.
SIGNED, SEALED AND DELIVERED
BY
_____________________________
for and on behalf
of INDIGO AVIATION AB
in the presence of:
91
92
SIGNED, SEALED AND DELIVERED
BY ____________________________
for and on behalf
of KOMMANDITBOLAGET
FLYPLANET XII
In the presence of:
Present when the Common Seal of
AERCO LIMITED
was affixed hereto:
SIGNED BY ______________________
for and on behalf
of AERCO USA INC.
in the presence of:
92
93
SCHEDULE 6A - FORM OF SOLVENCY CERTIFICATE (IRISH COMPANIES)
SOLVENCY CERTIFICATE
of
[Name of Company]
I HEREBY CERTIFY that the Board of Directors of ___________________________(the
"COMPANY") has duly considered the provisions of Section 214 of the Companies
Act, 1963 (as amended) and Section 2 of the Companies (Amendment) Act, 1990 (as
amended by Section 5 of the Company (Amendment) (No. 2) Act, 1999) and, all due
enquiries having been made, and having considered all matters which they
considered relevant to the Company's financial position has determined, to the
best of its knowledge, information and belief, provided that the closings of the
current transactions described in the Offering Memorandum take place that:
(a) the Company is not [,was not at any time in the preceding three
months,]* nor would it be deemed to be unable to pay its debts within
the meaning of Section 214 of the Companies Act, 1963 (as amended)
and/or Section 2 of the Companies (Amendment) Act, 1990 (as amended by
Section 5 of the Companies (Amendment) (No. 2) Act, 1999); and
(b) the Company would not become unable to pay its debts, nor would be
deemed to be unable to pay its debts, within the meaning of Section 214
of the Companies Act, 1963 (as amended) and/or Section 2 of the
Companies (Amendment) Act, 1990 (as amended by Section 5 of the
Companies (Amendment) (No. 2) Act, 1999), in consequence of any of the
transactions entered or to be entered into by it in connection with the
transactions described in the Offering Memorandum.
________________________________
and on behalf of Date:
* include only where the company has sold assets over the previous three months.
SCHEDULE 6B - FORM OF SOLVENCY CERTIFICATE (US COMPANIES)
93
94
SOLVENCY CERTIFICATE
of
[Name of Company]
[Name of Company] Inc (the "COMPANY") delivers this certificate in connection
with the transactions as described in the Offering Memorandum (the
"TRANSACTIONS"). Unless otherwise defined herein, terms defined in the Offering
Memorandum are used herein as therein defined.
[The Company certifies that it has carefully reviewed the Offering Memorandum
and the contents of this certificate and, in connection herewith, has made such
investigation and inquiries as it has deemed necessary and prudent therefor. The
Company further certifies that the financial information, assumptions and
valuation techniques which underlie and form the basis for the representations
made in this certificate were reasonable when made and were made in good faith
and continue to be reasonable as of the date hereof.]
The Company hereby certifies that as of the date
hereof:-
1. On the date hereof, both before and after giving effect to the
Transactions, the fair value of the assets and the Company is greater
than the total amount of its liabilities, including subordinated,
absolute, fixed, matured or unmatured and liquidated or unliquidated
liabilities, and Contingent Liabilities (as hereinafter
defined)(collectively "LIABILITIES").
2. On the date hereof, both before and after giving effect to the
Transactions, the present fair saleable value of the assets of the
Company will exceed (a) the amount that will be required to pay its
probable liabilities on its debts as such debts become absolute and
mature, and (b) its total Liabilities (including, without limitation,
subordinated, unmatured, liquidated and Contingent Liabilities (as
hereinafter defined).
3. On the date hereof, both before and after giving effect to the
Transactions, the Company will be able to pay its debts and other
Liabilities, contingent obligations and other commitments as they
mature in the normal course of business.
4. On the date hereof, both before and after giving effect to the
Transactions, the Company is not engaged in any business or any
transaction, and is not about to engage in any business or any
transaction, for which its property would constitute unreasonably small
capital.
5. The Company does not intend to, and does not believe that it will incur
debts and liabilities that will be beyond its ability to pay such debts
or liabilities as they mature.
6. In consummating the Transactions, the Company does not intend to
hinder, delay or defraud either present or future creditors or any
other Person to which the Company is or will become, on or after the
date hereof, indebted.
94
95
7. In reaching the conclusions set forth in this certificate, the Company
has considered, among other things (both before and after giving effect
to the Transactions):-
(c) the cash and other current assets of or available to the
Company, determined after giving effect, on a pro forma basis,
to the Transaction;
(d) all contingent liabilities of the Company including, without
limitation, claims arising out of pending or threatened
litigation, and in so doing, the Company has computed the
amount of such liabilities as the amount which, in light of
all the facts and circumstances existing on the date hereof,
represents the amount that would reasonably be expected to
become an actual or matured liability (the "CONTINGENT
LIABILITIES"); and
(e) such other financial, statistical and other data known to it
and believed by it to be relevant for the purpose of this
certificate.
IN WITNESS WHEREOF, I have executed this certificate for and on behalf of [ ] on
the ____________ day of ____________________, 2000.
By: ________________________________
Name:
Title:
95
96
SCHEDULE 6C - FORM OF SOLVENCY CERTIFICATE (BALTIC II AND BALTIC III)
SOLVENCY CERTIFICATE
of
BALTIC AIRLEASE II[I] LLC
I HEREBY CERTIFY that the Board of Directors of Baltic AirLease II[I] LLC (the
"COMPANY") has duly considered the provisions of the Isle of Man Limited
Liability Companies Act 1996 and, all due enquiries having been made, and having
considered all matters which they considered relevant to the Company's financial
position has determined, to the best of its knowledge, information and belief,
provided that the closings of the current transactions as described in the
Offering Memorandum take place that:-
(a) the Company is not nor would it be deemed to be unable to pay its debts
within the meaning of Section 307 of the Isle of Man Companies ▇▇▇ ▇▇▇▇
(as applied by the Isle of Man Limited Liability Companies Act 1996);
(b) the Company would not become unable to pay its debts, nor would it be
deemed to be unable to pay its debts, within the meaning of Section 307
of the Isle of Man Companies ▇▇▇ ▇▇▇▇ (as applied by the Isle of Man
Limited Liability Companies Act 1996) in consequence of any of the
documents or transactions entered or to be entered into by it in
connection with the transactions described in the Offering Memorandum.
_______________________________
for and on behalf of Date
BALTIC AIRLEASE II[I] LLC
96
97
SCHEDULE 6D - FORM OF SOLVENCY CERTIFICATE (SWEDISH COMPANIES)
SOLVENCY CERTIFICATE
OF
[Name of Company]
I HEREBY CERTIFY that the Board of Directors of [ ] (the "COMPANY") has duly
considered the provisions of Chapter 1, Section 2 and Chapter 2, Section 7-9 of
the Bankruptcy Act 1987 (as amended) and, all due enquiries having been made,
and having considered all matters which they considered relevant to the
Company's financial position has determined, to the best of its knowledge,
information and belief, provided that the closing of the current transactions as
described in the Offering Memorandum take place that:
(a) the Company is not nor would it be deemed to be unable to pay its debts
within the meaning of Chapter 1, Section 2 of the Bankruptcy Act 1987
(as amended); and
(b) the Company would not become unable to pay its debts, nor would it be
deemed to be unable to pay its debts, within the meaning of Chapter 1,
Section 2 of the Bankruptcy Act 1987 (as amended), in consequence of
any of the documents or transactions entered or to be entered into by
it in connection with the transactions described in the Offering
Memorandum.
_______________________________
for and on behalf of Date:
97
98
SCHEDULE 7 - PARTICULARS OF THE AIRCRAFT
SERIAL NO. TYPE ENGINES LESSEE DETAILS OF LEASE CURRENT MONTHLY INITIAL APPRAISED
RENTAL (US$) VALUE (US$,000'S)
__________________________________________________________________________________________________________________________________
1207 A321-200 V10705 British Midland See Lease Summary Attached 402,096 52,103
V10708 Airlines
__________________________________________________________________________________________________________________________________
25041 B737-300 725,728 Virgin Express See Lease Summary Attached 215,000 23,237
725,744 Ireland
__________________________________________________________________________________________________________________________________
27074 B737-400 727181(A) Blue Panorama See Lease Summary Attached 282,000 26,867
725766(B)
__________________________________________________________________________________________________________________________________
25789 B737-500 727437(A) British Airways See Lease Summary Attached 215,000 20,513
727429(B)
__________________________________________________________________________________________________________________________________
23345 B737-300 721302(A) Delta See Lease Summary Attached 216,193 14,530
721304(B)
__________________________________________________________________________________________________________________________________
25594 B737-400 727476(A) LOT See Lease Summary Attached 257,500 26,623
727433(A)
__________________________________________________________________________________________________________________________________
98
99
SERIAL NO. TYPE ENGINES LESSEE DETAILS OF LEASE CURRENT MONTHLY INITIAL APPRAISED
RENTAL (US$) VALUE (US$,000'S)
___________________________________________________________________________________________________________________________________
11320 F100 17326 (A) TAM Aircraft Lease Agreement dated as of 23 October 1997 142,970 12,783
17328 (B) between GPA Fokker 100 Limited and TAM-Transportes
Aeros Meridionais, as amended by a letter agreement
dated 1 October 1999 and an Aircraft Rescheduling
Agreement dated 7 October 1999 and as assumed and
amended by an Aircraft Lease Assumption and Amendment
Agreement dated 30 November 1999 between AerFi Fokker
100 Limited, AerFi Sverige Leasing AB and
TAM-Transportes Aereos Meridionais SA.
____________________________________________________________________________________________________________________________________
11322 F100 17557 TAM Aircraft Lease Agreement dated as of 23 October 1997 142,944 12,673
between GPA Fokker 100 Limited and TAM-Transportes
Aeros Meridionais, as amended by a letter agreement
dated 1 October 1999 and an Aircraft Rescheduling
Agreement dated 7 October 1999 and as assumed and
amended by an Aircraft Lease Assumption and Amendment
Agreement dated 30 November 1999 between AerFi Fokker
100 Limited, AerFi Sverige Leasing AB and
TAM-Transportes Aereos Meridionais SA.
____________________________________________________________________________________________________________________________________
99
100
SERIAL NO. TYPE ENGINES LESSEE DETAILS OF LEASE CURRENT MONTHLY INITIAL APPRAISED
RENTAL (US$) VALUE (US$,000'S)
__________________________________________________________________________________________________________________________________
24901 B737-400 857391(A) Blue Panorama See Lease Summary Attached 282,000 24,597
725209(B)
__________________________________________________________________________________________________________________________________
25768 B737-500 859191(A) Asiana See Lease Summary Attached 269,560 22,433
858179(B)
__________________________________________________________________________________________________________________________________
24651 B737-500 726268(A) Braathens See Lease Summary Attached 705,000 per qtr 18,810
726479(B) Billed quarterly
__________________________________________________________________________________________________________________________________
934 A320-200 V10476(A) British Midland See Lease Summary Attached 314,056 40,420
V10477(B) Airlines
__________________________________________________________________________________________________________________________________
49905 MD-82 725699(A) Finnair See Lease Summary Attached 575,700 per qtr 18,817
726810(B) Billed quarterly
__________________________________________________________________________________________________________________________________
53245 MD-82 708530(A) Finnair See Lease Summary Attached 515,700 per qtr 21,103
718162(B) Billed quarterly
__________________________________________________________________________________________________________________________________
354 A320-200 244(A) JMC Airlines See Lease Summary Attached 290,000 29,980
246(B)
__________________________________________________________________________________________________________________________________
24856 B737-300 724667(A) Frontier See Lease Summary Attached 220,000 21,987
725630(B)
__________________________________________________________________________________________________________________________________
26442 B737-300 856183(A) Frontier See Lease Summary Attached 212,000 23,063
857192(B)
__________________________________________________________________________________________________________________________________
100
101
SERIAL NO. TYPE ENGINES LESSEE DETAILS OF LEASE CURRENT MONTHLY INITIAL APPRAISED
RENTAL (US$) VALUE (US$,000'S)
__________________________________________________________________________________________________________________________________
411 A320-200 279(A) JMC Airlines See Lease Summary Attached 290,000 30,617
289(B)
__________________________________________________________________________________________________________________________________
24270 B737-400 726247(A) Virgin Express See Lease Summary Attached 242,000 22,547
858430(B)
__________________________________________________________________________________________________________________________________
24271 B737-400 726153(A) Virgin Express See Lease Summary Attached 242,000 22,987
725592(B)
__________________________________________________________________________________________________________________________________
24834 B737-300 724810(A) Varig See Lease Summary Attached 275,000 22,013
725689(B)
__________________________________________________________________________________________________________________________________
26440 B737-300 726422(A) Frontier See Lease Summary Attached 212,000 23,483
726492(B)
__________________________________________________________________________________________________________________________________
49931 MD-82 P725681(A) Reno Air See Lease Summary Attached 205,000 18,953
P725674(B)
__________________________________________________________________________________________________________________________________
49932 MD-82 P725675D(A) Reno Air See Lease Summary Attached 205,000 19,340
P725676D(B)
__________________________________________________________________________________________________________________________________
28486 B737-200 728711(A) TWA See Lease Summary Attached 534,029 51,320
728712(B)
__________________________________________________________________________________________________________________________________
24021 B737-300Q 727258(A) L'Aeropostale See Lease Summary Attached 253,250 21,637
723287(B)
__________________________________________________________________________________________________________________________________
101
102
SERIAL NO. TYPE ENGINES LESSEE DETAILS OF LEASE CURRENT MONTHLY INITIAL APPRAISED
RENTAL (US$) VALUE (US$,000'S)
__________________________________________________________________________________________________________________________________
27153 B737-500 857660(A) Xiamen Airlines See Lease Summary Attached 1,487,412.65 20,460
857661(B) Per 6 months
__________________________________________________________________________________________________________________________________
27155 B737-500 857569(A) Xiamen Airlines See Lease Summary Attached 1,404,368 19,943
856527(B) Billed for
6 months
__________________________________________________________________________________________________________________________________
25604 B737-300 856434(A) China Southern See Lease Summary Attached 260,393 23,033
856442(B)
__________________________________________________________________________________________________________________________________
49570 MD-82 P696425(A) Spanair See Lease Summary Attached 190,000 17,180
P708161(B)
__________________________________________________________________________________________________________________________________
102
103
SCHEDULE 8 - AUDITED FINANCIAL STATEMENTS
IN RESPECT OF THE FOLLOWING COMPANIES
INDEX
1. AerFi BM Limited - Period Ended March 31,2000
2. Baltic Airlease II LLC - Period Ended December 31, 1999
3. Baltic Airlease III LLC - Period Ended December 31, 1999
4. Lorenton Limited - Period Ended March 31, 2000
5. Ergo Leasing Limited - Period Ended March 31, 2000
6. Indigo Aviation Ireland Limited - Period Ended December 31, 1998
7. AerFi POL Inc. - Period Ended March 31, 2000
103
104
SCHEDULE 9 - PRO-FORMA BALANCE SHEETS
104
