COLLATERAL AND SECURITY AGREEMENT
By and Between
AIRSHIP INTERNATIONAL LTD.
and
ORIX USA CORPORATION
Dated as of May 10, 1994
COLLATERAL AND SECURITY AGREEMENT
TABLE OF CONTENTS
Page
ARTICLE 1............................................................1
ARTICLE 2............................................................2
2.1 Grant of Collateral....................................2
2.2 Collateral as Security Only............................3
ARTICLE 3............................................................3
3.1 Title..................................................3
3.2 Preservation of Rights.................................3
3.3 Perfection of Liens....................................3
3.4 Other Assurances.......................................3
3.5 Maintenance of Name, etc...............................4
3.6 No Other Financing Statements..........................4
3.7 Maintenance of Records.................................4
3.8 Schedules and Reports..................................5
3.9 Maintenance of Office..................................5
3.10 No Negotiable Documents................................5
3.11 Taxes and Assessments..................................5
3.12 Notices................................................5
3.13 Release of Collateral..................................5
ARTICLE 4............................................................6
4.1 Maintenance and Repair.................................6
4.2 Right of Inspection....................................6
ARTICLE 5............................................................6
5.1 Events of Default......................................6
5.2 Remedies Generally.....................................7
5.3 Application of Moneys..................................9
ARTICLE 6...........................................................10
6.1 Notices...............................................10
6.2 No Waivers............................................10
6.3 Amendments............................................11
6.4 Indemnification.......................................11
6.5 Headings..............................................11
6.6 Severability..........................................11
6.7 Successors and Assigns................................11
6.8 Governing Law.........................................12
6.9 Counterparts..........................................12
6.10 Termination...........................................12
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COLLATERAL AND SECURITY AGREEMENT
THIS COLLATERAL AND SECURITY AGREEMENT is entered into as of May 10,
1994, by and between AIRSHIP INTERNATIONAL LTD., a New York corporation
(together with all of its subsidiaries and its successors and assigns,
"Lessee"), and ORIX USA CORPORATION ("Secured Party").
Capitalized terms used herein but not herein defined shall have the
meanings given in the Loan Agreement (as hereafter defined).
W I T N E S S E T H:
WHEREAS, Lessee, as borrower, has entered into a Lease Agreement (as
amended by the Letter Agreement dated January 11, 1994 and the Amendment to
Lease dated as of May 10, 1994) (the "Lease") dated as of November 2, 1989 with
Secured Party, as Lessor, pursuant to which Lessee has leased Airship No.
N600LP; and
WHEREAS, the Amendment to Lease requires, the execution and delivery of
this Collateral and Security Agreement ("Collateral and Security Agreement") in
order to secure performance by Lessee of all its obligations under the Lease and
under this Collateral and Security Agreement ("Secured Obligations").
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereto agree as follows:
ARTICLE 1
DEFINITIONS
Capitalized terms used herein but not defined herein shall have the
meanings given in the Loan Agreement. The following terms shall have the
respective meanings set forth below:
"Aircraft Security Agreement" shall mean the Aircraft Security
Agreement between Lessee and Secured Party, substantially in the form of
Exhibit A to this Collateral and Security Agreement.
"Chattel Paper" shall have the meaning given to such term in the
Code.
"Code" shall mean the Uniform Commercial Code as in effect in any
applicable jurisdiction.
"Collateral" shall have the meaning given in section 2.1.
"Contracts" shall mean all contracts, leases, undertakings or
agreements (other than rights evidenced by Chattel Paper, Documents or
Instruments) in or under which Lessee may now or hereafter have any
right, title or interest that do not specifically relate to the
ownership operation, maintenance or leasing of a specific airship (other
than the airship to which the Aircraft Security Agreement relates).
"Customer Contracts" shall mean all Contracts entered into
between Lessee and customers of Lessee.
"Lessee" shall mean Airship International Ltd., 0000 Xxxx Xxxx
Xxxx, Xxxxx 000, Xxxxxxx, XX 00000.
"Distribution Date" shall have the meaning given in Section
6.3(a).
"Documents" shall have the meaning given to such term in the
Code.
"Document of Title" shall have the meaning given in the Code.
"Equipment" shall have the meaning given in Section 2.1(a).
"Instrument" shall mean any "instrument," as such term is defined
in the Code.
"Other Assurances" shall have the meaning given in Section 3.4.
"Sale Proceeds" shall have the meaning given in section 2.1(d).
"Secured Party" shall mean ORIX USA CORPORATION, 000 Xxxxxxxx
Xxxx, Xxxxx 0000, Xxx Xxxxxxx, XX 00000.
ARTICLE 2
COLLATERAL
2.1 Grant of Collateral. In order to secure the due and punctual payment
and performance of each of the Secured Obligations, Lessee hereby, and by its
execution and delivery of this Collateral and Security Agreement, grants,
transfers, warrants, conveys, assigns and mortgages to Secured Party, and grants
to Secured Party a security interest in, the following property, wherever
located, including without limitation all present and future proceeds and
products of, increases, replacements and accessions to, and rights to insurance
and documents covering or received by Lessee on account of any such property,
all for the benefit and security of Secured Party:
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The Airship Industries Model 500-HL Skyship, Serial No. 1214/06,
FAA Registration Number N 601LP, as more specifically described in the
Aircraft Security Agreement attached as Exhibit A to this Collateral and
Security Agreement (the "Collateral").
2.2 Collateral as Security Only. The grant of Collateral to Secured
Party hereunder is as security only and shall not subject Secured Party to, or
transfer or in any way affect or modify, any obligation or liability of Lessee
under any of the Collateral or any transactions which gave rise thereto.
ARTICLE 3
LESSEE'S GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS
Lessee represents, warrants, covenants and agrees to and with Secured
Party as follows:
3.1 Title. Lessee has and will at all times have and maintain good title
to all Collateral that is owned by Lessee free of all security interests, liens
and encumbrances; the liens and security interests hereunder will be perfected
on or prior to the Closing Date and otherwise will be and remain perfected.
3.2 Preservation of Rights. Lessee shall at its expense protect, warrant
and defend forever its rights in the Collateral, and the rights of Secured Party
therein and thereto against the claims and demands of all persons whomsoever,
and this covenant shall not be extinguished by any exercise of power of sale,
foreclosure or sale thereof or other remedy hereunder or provided by law.
3.3 Perfection of Liens. Lessee has caused and shall cause this
Collateral and Security Agreement to be filed, registered or recorded and to be
kept, filed, registered or recorded in such manner and in such places as may be
required by any present or future law in order to publish notice of and fully to
protect, perfect and continue the liens and security interests hereof upon, and
the rights and interest of Secured Party in, the Collateral.
3.4 Other Assurances. Without limiting the provisions of Section 3.3,
Lessee (i) shall do, execute, acknowledge and deliver all and every such further
acts, deeds, conveyances, supplemental agreements, assignments, instruments,
notices of assignments, financing statements, continuation statements,
assignments of rents or leases, transfers, assurances and other instruments,
documents, writings and agreements as Secured Party may from time to time deem
necessary or advisable, for the better assuring, conveying, assigning,
transferring, hypothecating, pledging and confirming unto Secured Party the
Collateral and rights hereby granted, conveyed or assigned, or which Lessee may
be or may hereafter become bound to convey or assign to, or for carrying out the
intention of or facilitating the performance of the
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terms of this Collateral and Security Agreement, or for filing, registering or
recording this Collateral and Security Agreement or subjecting any portion of
the Collateral to the lien and security interest hereof with the priority
therefor required hereunder, or for facilitating Secured Party's exercise of its
rights and remedies hereunder; and (ii) hereby irrevocably appoints Secured
Party to be its attorney for and in its name and on its behalf for such
purposes, and generally to use its name in the exercise of all or any of the
powers hereby conferred on Secured Party with full power of substitution. The
power and authority hereby given and granted by Lessee to Secured Party shall be
deemed coupled with an interest and shall not be revocable by Lessee until
termination pursuant to Section 7.10 of the security interests created in the
Collateral hereby.
3.5 Maintenance of Name, etc. Lessee will not change its name, identity
or corporate structure in any manner which might make any financing or
continuation statement filed in respect of the Collateral seriously misleading
within the meaning of Section 9-402(7) (or any other then applicable provision)
of the Code unless Lessee shall have given Secured Party at least 30 days' prior
written notice thereof.
3.6 No Other Financing Statements. Without the prior written consent of
Secured Party, Lessee will not file or authorize or permit to be filed in any
jurisdiction any financing statement or like instrument covering or relating to
any Collateral in which Secured Party is not named as the secured party.
3.7 Maintenance of Records. Lessee shall keep and maintain at its own
cost and expense satisfactory and complete records of the Collateral, including,
without limitation, a record of any and all payments received and any and all
credits granted with respect to the Collateral and all other dealings with the
Collateral. Lessee shall take such steps as may be necessary to make employees
of Lessee aware of this Collateral and Security Agreement and the security
interests granted hereby. For Secured Party's further security, Lessee agrees
that Secured Party shall have a special property interest in all of the Lessee's
books and records pertaining to the Collateral and, upon the occurrence and
during the continuation of any Event of Default, Lessee shall deliver and turn
over any such books and records to Secured Party or its representative at any
time upon demand of Secured Party. Prior to the appearance of an Event of
Default and upon reasonable notice from Secured Party, Lessee shall permit any
representative of Secured Party to inspect such books and records and shall
provide photocopies thereof to Secured Party.
3.8 Schedules and Reports. Lessee shall furnish to Secured Party from
time to time, as promptly as feasible upon Secured Party's reasonable request,
schedules identifying and describing the Collateral (including, without
limitation, the locations thereof) and other reports in connection with the
Collateral, all as Secured Party may reasonably request.
3.9 Maintenance of Office. Lessee represents and warrants that its chief
executive office is located at 0000 Xxxx Xxxx Xxxx, Xxxxx 000, Xxxxxxx, XX
00000.
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Lessee will not change the location of its chief executive office unless Lessee,
at least 30 days prior to such change, notifies Secured Party of such change and
takes all action necessary or that Secured Party may reasonably request to
preserve, perfect, confirm and protect (to the extent contemplated hereby and by
the Loan Agreement) Secured Party's liens and security interests in the
Collateral. Lessee will at all times maintain its chief executive office within
one of the states in the 48 contiguous states (other than Maryland or
Tennessee), in which Article 9 of the Code (Secured Transactions) is in effect.
3.10 No Negotiable Documents. Lessee shall not deposit any Collateral in
exchange for a negotiable Document of Title.
3.11 Taxes and Assessments. Lessee shall furnish to Secured Party such
official receipts as Secured Party may reasonably request evidencing the payment
in full, when required hereby or by the Lease, of all general taxes and
assessments, special taxes, special assessments, and all other charges against
the Collateral.
3.12 Notices. Lessee shall advise Secured Party promptly, in reasonable
detail, of any material lien or other encumbrance attaching to or asserted
against any of the Collateral.
3.13 Release of Collateral. Lessee shall have the right to sell or
dispose of Collateral only to the extent and subject to the conditions set forth
herein. In the event of any such permitted sale or disposition, the lien and
security interest created by this Collateral and Security Agreement shall be
released from the property so disposed of, and Secured Party shall execute and
deliver any releases, instruments or documents necessary to accomplish the
foregoing, provided that any such release, execution or delivery shall be
without recourse or warranty of any kind.
ARTICLE 4
MAINTENANCE, REPAIR AND INSPECTION
4.1 Maintenance and Repair. Lessee shall keep the Collateral in
sufficient operating order, repair and condition for the performance of its
business.
4.2 Right of Inspection. Upon reasonable notice to Lessee, Secured Party
and its representatives shall also have the right to enter into and upon any
premises where any of the Collateral is located for the purposes of inspecting
the same, observing its use or otherwise protecting Secured Party's interest
therein.
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ARTICLE 5
DEFAULT
5.1 Events of Default. For all purposes of this Collateral and Security
Agreement, the term "Event of Default" shall have the meaning given to it in the
Lease. Notwithstanding anything herein, and without limiting any other rights
provided hereunder or by law, upon the occurrence of an Event of Default,
Secured Party may execute and cause to be recorded a notice or other declaration
of default required by any applicable laws providing for a cure or other
moratorium before the Collateral or any portion thereof may be foreclosed
judicially or nonjudicially; provided, however, that any notice of intention to
accelerate indebtedness contained in said notice or other declaration of default
shall refer to acceleration no sooner than the later of the cure or other period
provided by any applicable laws or any applicable period provided by the Lease
or this Collateral and Security Agreement.
5.2 Remedies Generally. After an Event of Default has occurred and is
continuing (and has not been rescinded, cured or waived), in addition to, and
not by way of limitation of, any right which Secured Party may have hereunder or
under applicable law or otherwise:
(a) Secured Party shall have all of the rights and remedies of a
secured party under the Code, including without limitation, the right
and power to sell, or otherwise dispose of, any personal property
constituting Collateral, wherever situated, and remove the same without
being deemed guilty of trespass and without liability for damages
thereby occasioned, or, at its option and upon its demand, to cause
Lessee to assemble any Collateral and make it available at the place and
time designated in such demand. Secured Party without notice to or
demand upon Lessee, may make such payments and do such acts as Secured
Party deems necessary to protect the lien and security interest hereof
(including without limitation paying, purchasing, contesting or
compromising any encumbrance, charge or lien which is prior to or
superior to the lien and security interest granted hereunder), and in
exercising any such powers or authority may pay all expenses incurred in
connection therewith, and shall be entitled to hold, maintain, preserve
and prepare any Collateral for sale, and may render such Collateral
unusable and dispose of it on any premises. Notice of any sale or other
disposition of any Collateral shall be given to Lessee by notice via
certified mail at Lessee's address for notice under this Collateral and
Security Agreement at least ten days before the time of the sale or
disposition.
(b) Secured Party may, with or without entry, personally or by
its agents or attorneys, insofar as applicable:
(i) sell the Collateral and all estate, right, title and
interest, claim and demand therein, and any right of redemption
thereof, at one
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or more sales as an entirety or in parcels, and at such times and
places and after such notices thereof as may be required or
permitted by law at private sale or at a public auction to the
highest bidder for cash, in lawful money of the United States,
payable at the time of such private or public sale;
(ii) apply to any court of competent jurisdiction for the
appointment of a receiver or receivers for Collateral or any
portion thereof, and of all the rents thereof, and Lessee hereby
consents to such appointment; or
(iii) take such steps to protect and enforce its rights,
whether by action, suit or proceeding in equity or at law, for
the specific performance of any covenant, condition or agreement
in this Collateral and Security Agreement or in any agreements
governing, instruments evidencing or documents securing Secured
Obligations, or in aid of the execution of any power herein or
therein granted, or for the enforcement of any other appropriate
legal or equitable remedy or otherwise as Secured Party shall
elect.
(c) Secured Party may file such proofs of claim and other papers
or documents as may be deemed necessary or advisable in order to have
the claims of Secured Party allowed in any judicial proceedings relative
to Lessee or the creditors, or property, of Lessee.
(d) Secured Party may adjourn from time to time any sale by it to
be made under or by virtue of this Collateral and Security Agreement by
announcement at the time and place appointed for such sale or for such
adjourned sale or sales; and, except as otherwise provided by any
applicable provision of law, without further notice or publication, may
make such sale at the time and place to which the same shall be so
adjourned.
(e) Upon the completion of any sale or sales made by Secured
Party under or by virtue of this Article, Secured Party shall execute
and deliver to the accepted purchaser or purchasers a good and
sufficient instrument, or good and sufficient instruments, conveying,
assigning and transferring all estate, right, title and interest in and
to the property and rights sold, but without any covenant or warranty,
express or implied. The recitals in such instrument of any matters or
facts shall be conclusive proof of the truthfulness thereof. Any such
sale or sales made under or by virtue of this Article 5 whether made
under the power of sale herein granted or under or by virtue of judicial
proceedings or of a judgement or decree of foreclosure and sale shall
operate to absolutely divest all the estate, right, title, interest,
claim and demand whatsoever, whether at law or in equity, of Lessee in
and to the properties and rights so sold, and shall be a perpetual bar
both at law and in equity against Lessee and against any and all persons
claiming or who may claim the same,
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or any part thereof from, through or under Lessee, and to the extent
permitted by law Lessee hereby specifically waives all rights of
redemption, stay or appraisal which it has or may have under any rule of
law or statute now existing or hereafter in force.
(f) Lessee on its own behalf and on behalf of its successors and
assigns hereby expressly waives all rights to require (i) a marshalling
of assets by Secured Party or (ii) Secured Party to first resort to some
or any portion of the Collateral before foreclosing upon and selling any
other portion thereof.
5.3 Application of Moneys.
(a) All moneys held by Secured Party or proceeds received by
Secured Party pursuant to this Section 5, to the extent available for
distribution, shall be distributed by Secured Party on the last business
day of each calendar month (the "Distribution Date") in the following
order of priority, to the extent permitted by law:
First: To Secured Party for any unpaid fees and other amounts
payable to the Secured Party under the Lease, in an amount equal
to such unpaid amounts on such Distribution Date;
Second: Any surplus then remaining shall be distributed without
recourse or warranty to the Person or Persons entitled thereto.
(b) Secured Party may, to the extent permitted by law, make
distributions hereunder in cash or in kind or in any combination
thereof.
(c) All distributions made by Secured Party pursuant to this
Section 5.3 shall be final. However, if at any time Secured Party
determines a distribution previously made pursuant to this Section 5.3
was based on a mistake of fact, Secured Party shall adjust subsequent
distributions hereunder so that on a cumulative basis Secured Party and
all other persons shall receive the distributions to which they would
have been entitled it such mistake of fact had not been made.
ARTICLE 6
MISCELLANEOUS
6.1 Notices. Any notice which the Lessee or the Secured Party may be
required or may desire to give to the other party under any provision of this
Collateral and Security Agreement shall be in writing and shall be delivered by
hand or transmitted by electronic facsimile transmission and shall be deemed to
have been given or made when so delivered or transmitted and addressed as
follows:
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To the Lessee: Airship International Ltd.
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Telecopier: (000) 000-0000
Copies to: Xxxxx X. Xxxxxxxx
0000 Xxxxx Xxxx Xxxxx
Xxxxxxx, XX 00000
Telecopier: (000) 000-0000
and
Xxxx Xxxxx & Xxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx, Esq.
Telecopier: (000) 000-0000
To the Secured
Party: ORIX USA CORPORATION
000 Xxxxxxxx Xxxx, Xxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Telecopier: (000) 000-0000
Any party may change the address to which all notices, requests and
other communications are to be sent to it by giving written notice of such
address change to the other parties in conformity with this paragraph, but such
change shall not be effective until notice of such change has been received by
the other parties.
6.2 No Waivers. No failure on the part of Secured Party to exercise, no
course of dealing with respect to, and no delay in exercising, any right, power
or privilege under this Collateral and Security Agreement shall operate as a
waiver thereof nor shall any single or partial exercise of any such right, power
or privilege preclude any other or further exercise thereof or the exercise of
any other right, power or privilege.
6.3 Amendments. This Collateral and Security Agreement may not be
amended or modified except by an instrument in writing signed by Lessee and
Secured Party.
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6.4 Indemnification.
(a) Lessee shall pay, indemnify, and hold Secured Party harmless from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgements, suits, costs, expenses (including, without limitation, the
reasonable fees of counsel) or disbursements of any kind or nature whatsoever
with respect to the execution, delivery, enforcement, performance and
administration of this Collateral and Security Agreement unless arising from the
gross negligence or willful misconduct of the Secured Party (including, without
limitation, indemnification of Secured Party for liabilities of Secured Party
for the net amount of taxes (after taking account of any deduction, credit or
other tax reduction or benefit available by reason of the imposition of any such
tax) in any jurisdiction in which such Secured Party would not otherwise be
subject to tax except by reason of its acting under this Collateral and Security
Agreement (directly or through any agent, co-agent or trustee) and any filing
fee or excise tax paid by Secured Party pursuant hereto. As security for
payments under the aforesaid indemnity, Secured Party shall have a lien upon all
the Collateral.
(b) In any suit, proceeding or action brought by Secured Party under or
with respect to the Collateral for any sum owing hereunder or to enforce any
provisions hereof, Lessee will save, indemnify and keep Secured Party harmless
from and against all expense, loss or damage suffered by reason of any defense,
offset, counterclaim, recoupment or reduction of liability whatsoever of the
obligor thereunder, arising out of a breach by Lessee or any of its affiliates
of any obligation thereunder or arising out of any other agreement, indebtedness
or liability at any time owing to or in favor of such obligor or its successors
from Lessee, and all such obligations of Lessee shall be and remain enforceable
against and only against Lessee and shall not be enforceable against Secured
Party, its agents or employees.
6.5 Headings. The table of contents and the headings of Articles and
Sections have been included herein for convenience only and shall not be
considered in interpreting this Collateral and Security Agreement.
6.6 Severability. Any provision of this Collateral and Security
Agreement which is prohibited or unenforceable in any jurisdiction shall not
invalidate the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
6.7 Successors and Assigns. This Collateral and Security Agreement shall
be binding upon and inure to the benefit of the parties hereto and shall inure
to the benefit of Secured Party and its respective successors and assigns, and
nothing herein is intended or shall be construed to give any other Person any
right, remedy or claim under, to or in respect of this Collateral and Security
Agreement or any Collateral.
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6.8 Governing Law. This Collateral and Security Agreement shall be
governed by, and construed and interpreted in accordance with, the internal laws
of the State of New York (disregarding any conflict of laws rule which might
result in the application of laws of any other jurisdiction). All judicial
proceedings brought against Lessee with respect to this Collateral and Security
Agreement may be brought in any State or federal court of competent jurisdiction
in the State of New York, and Lessee accepts for itself and its assets and
properties, generally and unconditionally, the nonexclusive jurisdiction of the
aforesaid courts.
6.9 Counterparts. This Collateral and Security Agreement may be signed
in any number of counterparts with the same effect as if the signatures thereto
and hereto were upon the same instrument.
6.10 Termination.
(a) Upon payment in full of all Secured Obligations, the liens and
security interests created by this Collateral and Security Agreement shall
terminate forthwith and all right, title and interest of Secured Party in and to
the Collateral shall revert to Lessee, its successors and assigns.
(b) Upon the termination of Secured Party liens and security interest
and the release of the Collateral in accordance with Section 6.10 (a) , Secured
Party will promptly, at Lessee I s written request and expense, (i) execute and
deliver to Lessee such documents as Lessee shall reasonably request to evidence
the termination of such security interest or the release of the Collateral and
(ii) deliver or cause to be delivered to Lessee all property of Lessee then held
by Secured Party.
IN WITNESS WHEREOF, the parties hereto have caused this Collateral and
Security Agreement to be duly executed by their respective authorized officers
as of the day and year first above written.
AIRSHIP INTERNATIONAL LTD.
By /s/ XXXXX X. XXXXXXXX
---------------------------
Name:
Title: President
ORIX USA CORPORATION
By /s/ Xxxxx X. Xxxxxxx
---------------------------
Name:
Title: Senior Vice President
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Exhibit A
to
Collateral and Security Agreement
DEPARTMENT OF TRANSPORTATION
FEDERAL AVIATION ADMINISTRATION
FAA AIRCRAFT REGISTRY
X.X. Xxx 00000
Xxxxxxxx Xxxx, Xxxxxxxx 00000
AIRCRAFT SECURITY AGREEMENT
NAME & ADDRESS OF DEBTOR
AIRSHIP INTERNATIONAL LTD.
0000 Xxxx Xxxx Xxxx, Xxx 000
Xxxxxxx, XX 00000
NAME & ADDRESS OF SECURED PARTY
ORIX USA CORPORATION
000 Xxxxxxxx Xxxx, Xxx 0000
Xxx Xxxxxxx, XX 00000
NAME OF SECURED PARTY'S ASSIGNOR
NOT APPLICABLE
Date: May 10, 1994
Complete description of collateral being mortgaged:
AIRCRAFT (FAA registration number, manufacturer, model, and serial number):
One (1) Airship Industries UK LTD Model 500-HL Skyship, Manufacturer's
Serial Number 1214/06, FAA Registration Number N 601LP.
ENGINES (manufacturer, model, and serial number):
[See Aircraft above]
PROPELLERS (manufacturer, model, and serial number):
[See Aircraft above]
SPARE PARTS LOCATIONS (air carrier's name, city and state)
Not Applicable
together with all equipment and accessories attached thereto or used in
connection therewith, all of which are included in the term aircraft as used
herein.
The above described aircraft is hereby mortgaged to the secured party for the
purpose of securing in the order named:
FIRST: The performance by Debtor of its obligations under the Lease
Agreement dated as of November 2, 1989, as amended, between Debtor and the
Secured Party.
SECOND: The prompt and faithful discharge and performance of each
agreement of the debtor herein contained or made with or for the benefit of the
secured party in connection with the indebtedness to secure which this
instrument is executed and the repayment of any sums expended or advanced by the
Secured Party for the maintenance or preservation of the property mortgaged
hereby or in enforcing his rights hereunder.
Said debtor hereby declares and hereby warrants to the said secured party that
he is the absolute owner of the legal and beneficial title to the said aircraft
and in possession thereof, and that the same is free and clear of all liens,
encumbrances, and adverse claims whatsoever.
It is the intention of the parties to deliver this instrument in the State of
New York.
Provided, however, that if the debtor, his heirs, administrators, successors, or
assigns shall pay said note and the interest thereon in accordance with the
terms thereof and shall keep and perform all and singular the terms, covenants,
and agreements in this security agreement, then this security agreement shall be
null and void.
Time is of the essence of this security agreement. It is hereby agreed that, if
default be made in the payment of any part of the principal or interest of the
Lease secured hereby at the time and in the manner therein specified, or if any
breach be made of any obligation or promise of the Debtor herein contained or
secured hereby, or if any or all of the property covered hereby be hereafter
sold, leased, transferred, mortgaged, or otherwise encumbered without first
obtaining the written consent of the Secured Party, or in the event of the
seizure of the Aircraft under execution or other legal process, or if for any
other reason the secured party may deem himself insecure, then the whole
principal sum unpaid upon said Lease, with the interest accrued
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thereon, or advanced under the terms of this security agreement, or secured
thereby, and the interest thereon, shall immediately become due and payable at
the option of the Secured Party.
Upon default, the Secured Party may at once proceed to foreclose this mortgage
in any manner provided by law, or he may at his option, and he is hereby
empowered so to do, with or without foreclosure action, enter upon the premises
where the said aircraft may be and take possession thereof, and remove and sell
and dispose of the same at public or private sale, and from the proceeds of such
sale retain all costs and charges incurred by him in the taking or sale of said
aircraft, including any reasonable attorney's fees incurred; also all sums due
him on said Lease, under any provisions thereof, or advanced under the terms of
this security agreement or the Collateral and Security Agreement dated the date
hereof between debtor and the Secured Party, and interest thereon, or due or
owing to the Secured Party, under any provisions of this security agreement, or
secured hereby, with the interest thereon, and any surplus of such remaining
shall be paid to the debtor, or whomever may be lawfully entitled to receive the
same. If a deficiency occurs, the debtor agrees to pay such deficiency
forthwith.
The Secured Party or its agent may bid and purchase at any sale made under this
mortgage or herein authorized, or at any sale made upon foreclosure of this
mortgage.
In witness whereof, the debtor has hereunto set its hand and seal on the day and
year first above written.
ACKNOWLEDGMENT:
(If required by
applicable law)
SIGNATURE(S)
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(In ink) (If executed for co-ownership, all must sign)
TITLE
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(If signed for a corporation, partnership, owner, or agent)
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