FIRST LIEN BORROWER PARTY
GUARANTEE AGREEMENT
FIRST LIEN
BORROWER PARTY GUARANTEE AGREEMENT dated as of October 13,
2009 (this “ Guarantee ”) by International Lease
Finance Corporation, a California corporation (“ ILFC
”), States Aircraft, Inc., a California corporation (“
States ”), Shrewsbury Aircraft Leasing Limited, a
private limited liability company incorporated under the laws of
Ireland (“ Shrewsbury ”, and together with ILFC
and States, the “ Borrowers ”), Top Aircraft,
Inc., a California corporation (“ Top Aircraft
”), ILFC Ireland Limited, a private limited liability company
incorporated under the laws of Ireland (“ ILFC Ireland
”), ILFC France S.a.r.l., a société à
responsabilité limitée organized under the laws
of France (“ ILFC France ”), and ILFC Labuan
Ltd., a Labuan private limited liability company incorporated under
the Offshore Companies Act 1990 of Malaysia (“ ILFC
Labuan ”, and together with ILFC Ireland and ILFC France,
the “ Intermediate Lessees ”) and the Additional
Guarantors (as defined in Section 11) (the Borrowers, Top
Aircraft, the Intermediate Lessees and the Additional Guarantors,
collectively, the “ Guarantors ” and each a
“ Guarantor ”) for the benefit of the Federal
Reserve Bank of New York (with its successors and assigns, the
“ Beneficiary ”).
WHEREAS, each
Guarantor is a direct or indirect wholly owned subsidiary of
American International Group, Inc., a Delaware corporation
(together with its successors, the “ Obligor
”);
WHEREAS, the
Obligor has entered into the Credit Agreement dated as of
September 22, 2008 among the Obligor, as borrower, and the
Beneficiary, as lender (as amended, restated, amended and restated,
supplemented or otherwise modified from time to time, the “
Parent Facility ”);
WHEREAS, the
Borrowers desire to borrow term loans in an aggregate principal
amount of $2,000,000,000 (the “ Term Loans ”)
under the Credit Agreement dated as of the date hereof among the
Borrowers, Top Aircraft, the Intermediate Lessees, AIG Funding,
Inc., as lender (the “ Borrower Facility Lender
”), and Wells Fargo Bank Northwest, National Association, as
security trustee (as amended, restated, amended and restated,
supplemented or otherwise modified from time to time, the “
Borrower Facility ”);
WHEREAS, in order
for the Borrower Facility Lender to make the Term Loans to the
Borrowers under the Borrower Facility, the Obligor must first make
a Borrowing (the “ New FRBNY Borrowing ”) under
the Parent Facility in an amount equal to the Term Loans, with the
funds so borrowed being advanced immediately to the Borrowers in
the form of the Term Loans;
WHEREAS, the
Parent Facility prohibits the making of the Term Loans by the
Borrower Facility Lender to the Borrowers as currently contemplated
by
the Borrower
Facility because the Borrowers are not Loan Parties under the
Parent Facility (the “ Existing Restriction
”);
WHEREAS, the
Beneficiary is willing to make the necessary waiver of the Existing
Restriction and the other applicable provisions of the Parent
Facility, pursuant to the Letter Agreement dated as of
October 13, 2009 among the Obligor and the Beneficiary, to
enable and permit the making of Term Loans under the Borrower
Facility, but only if each Guarantor (i) guarantees the
Guaranteed Obligations (as defined below) as more fully set forth
herein and (ii) secures such guarantee by granting a
first-priority security interest in, and lien on, certain of its
assets in favor of Wells Fargo Bank Northwest, National Association
(the “ Security Trustee ”), for the benefit of
the Beneficiary, as more fully set forth in the Aircraft Mortgage
and Security Agreement dated as of the date hereof (the “
Mortgage ”) among the Guarantors, the Security Trustee
and the other Security Trustees (as defined therein);
and
WHEREAS, in
consideration of the financial accommodation and other support that
the Obligor has provided, directly or indirectly, pursuant to the
Borrower Facility and such financial and other support as the
Obligor may in the future provide to the Guarantors, and in order
to induce the Beneficiary to consent to the making of the Term
Loans the Guarantors are willing to enter into this Guarantee and
to secure their obligations hereunder pursuant to the terms set
forth in the Mortgage.
NOW, THEREFORE, in
consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, each Guarantor, jointly and severally with each other
Guarantor, hereby agrees as follows:
1. Terms
Defined in the Parent Facility; Loan Document . For all
purposes of this Guarantee, all capitalized terms used but not
defined in this Guarantee (including in the recitals above) shall
have the respective meanings assigned to such terms in the Parent
Facility. This Guarantee shall be considered a “Loan
Document” under the Parent Facility.
2. The
Guarantee . Each Guarantor hereby, jointly and severally,
absolutely, unconditionally and irrevocably guarantees, as a
guarantee of payment and not merely as a guarantee of collection,
the full and punctual payment when due (whether at stated maturity,
upon acceleration or otherwise) of each Guaranteed Obligation, as
hereinafter defined; provided that the recourse of the
Beneficiary against the Guarantors under this Guarantee at any time
will be limited to an aggregate amount equal to the lesser of (a)
$2,000,000,000 plus all unpaid interest accrued thereon under the
Borrower Facility through and including such time and (b) the
amount of Obligations (as defined in the Borrower Facility)
outstanding under the Borrower Facility at such time. Upon failure
by the Obligor to pay punctually any Guaranteed Obligation, the
Guarantors shall pay the amount of Guaranteed Obligations not so
paid at the FRBNY Account (as
defined in the
Borrower Facility). The Beneficiary shall notify the Guarantors
when payment of any Guaranteed Obligation is due hereunder (and the
amount so due), unless prevented from doing so by applicable law,
including any Bankruptcy Law; provided that any failure of
the Beneficiary to so notify the Guarantors shall not affect the
obligations of the Guarantors hereunder. Without limiting the
generality of the foregoing, the liability of each Guarantor shall
extend to all amounts that constitute part of the Guaranteed
Obligations and would be owed by any Loan Party to the Beneficiary
but for the fact that they are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar
proceeding involving such Loan Party. In furtherance of the
foregoing, the Guarantors hereby agree to make payments of
principal and interest in respect of the Term Loans to the FRBNY
Account set forth in the Borrower Facility and each payment of
principal of the Term Loans shall be credited against and reduce on
a dollar-for-dollar basis the maximum amount of the
Guarantors’ obligations hereunder. For the avoidance of
doubt, any and all payments by any Guarantor under this Guarantee
shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes as though such payment were made
pursuant to Section 2.12 of the Parent Facility and such
Guarantor were a Borrower thereunder.
“
Guaranteed Obligations ” means (i) all principal
of all Loans outstanding from time to time under the Parent
Facility, all interest (including Post-Petition Interest) on such
Loans and all other amounts now or hereafter payable by the Obligor
under the Loan Documents and (ii) any renewals, refinancings
or extensions of any of the foregoing (including Post-Petition
Interest).
3.
Guarantee Unconditional . The obligations of each Guarantor
under this Guarantee are those of primary obligor, and not merely
of surety, and shall be unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released,
discharged or otherwise affected by:
(i) any extension,
renewal, settlement, compromise, waiver or release in respect of
any obligation of the Obligor, any other Guarantor, any
“Guarantor” (as defined in the Parent Facility) (an
“ Existing Guarantor ”) or any other Person
under any Loan Document, by operation of law or
otherwise;
(ii) any
modification or amendment of or supplement to any Loan Document or
any “Loan Document” (as defined in the Borrower
Facility) (a “ Borrower Facility Loan Document
”);
(iii) any release,
impairment, non-perfection or invalidity of any direct or indirect
security for any obligation of the Obligor, any other Guarantor,
any Existing Guarantor or any other Person under any Loan Document
or Borrower Facility Loan Document;
(iv) any change in
the corporate existence, structure or ownership of the Obligor, any
other Guarantor, any Existing Guarantor or any other Person or any
of their respective subsidiaries, or any insolvency, bankruptcy,
reorganization or other similar proceeding affecting the Obligor,
any other Guarantor, any Existing Guarantor or any other Person or
any of their assets or any resulting release or discharge of any
obligation of the Obligor, any other Guarantor, any Existing
Guarantor or any other Person under any Loan Document or Borrower
Facility Loan Document;
(v) the existence
of any claim, set-off or other right that such Guarantor may have
at any time against the Obligor, any other Guarantor, any Existing
Guarantor, the Beneficiary or any other Person, whether in
connection with the Loan Documents or the Borrower Facility Loan
Documents or any unrelated transactions; provided that
nothing herein shall prevent the assertion of any such claim by
separate suit or compulsory counterclaim;
(vi) any
invalidity or unenforceability relating to or against the Obligor,
any other Guarantor, any Existing Guarantor or any other Person for
any reason of any Loan Document or any Borrower Facility Loan
Document, or any provision of applicable law or regulation
purporting to prohibit the payment of any Obligation,
“Obligation” (as defined in the Borrower Facility),
Guaranteed Obligation or Secured Obligation by the Obligor, any
other Guarantor, any Existing Guarantor or any other Person;
or
(vii) any other
act or omission to act or delay of any kind by the Obligor, any
other Guarantor, any Existing Guarantor, any other party to any
Loan Document or Borrower Facility Loan Document, the Beneficiary
or any other Person, or any other circumstance whatsoever that
might, but for the provisions of this clause (vii), constitute a
legal or equitable discharge of or defense to any obligation of any
Guarantor hereunder.
4. Limit
of Liability . (a) Each Guarantor, and by its acceptance
of this Guarantee, the Beneficiary, hereby confirms that it is the
intention of all such Persons that this Guarantee and the
Guaranteed Obligations of each Guarantor hereunder not constitute a
fraudulent transfer or conveyance for purposes of Bankruptcy Law
(as hereinafter defined), the Uniform Fraudulent Conveyance Act,
the Uniform Fraudulent Transfer Act or any similar foreign, federal
or state law to the extent applicable to this Guarantee and the
Guaranteed Obligations of each Guarantor hereunder. To effectuate
the foregoing intention, the Beneficiary and the Guarantors hereby
irrevocably agree that the Guaranteed Obligations of each Guarantor
under this Guarantee at any time shall be limited to the maximum
amount as will result in the Guaranteed Obligations of such
Guarantor under this Guarantee not constituting a fraudulent
transfer or conveyance under Bankruptcy Law or any comparable
provision of applicable law. For purposes hereof,
“
Bankruptcy Law ” means any proceeding of the type
referred to in paragraph (g) of Article 7 of the Parent
Facility or Title 11, U.S. Code, or any similar foreign, federal or
state law for the relief of debtors.
(b) In the event
that the direct or indirect assets of any Guarantor organized under
the laws of Ireland are insufficient to pay in full all claims made
by the Beneficiary in respect of the Guaranteed Obligations of such
Guarantor under this Agreement, then the Beneficiary shall have no
further claim against such Guarantor with respect to its Guaranteed
Obligations for amounts that exceed its direct or indirect assets
at such time.
(c) The
guarantees, obligations, liabilities and undertakings granted by
ILFC France under this Guarantee shall, for each relevant financial
year, be, in any and all cases, strictly limited to 90% of the
annual net margin generated by ILFC France in connection with
back-to-back leasing activities between it and ILFC with respect to
the lease of Pool Aircraft (as defined in the Borrower
Facility).
5.
Discharge Only Upon Payment in Full; Reinstatement In Certain
Circumstances. Each Guarantor’s obligations hereunder
shall remain in full force and effect until the earlier of the time
(a) all Guaranteed Obligations shall have been paid in full
and no Commitment remains outstanding and (b) all outstanding
“Obligations” (as defined in the Borrower Facility)
shall have been paid in full. If at any time any payment of any
Guaranteed Obligation is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of the
Obligor or otherwise, the Guarantor’s obligations hereunder
with respect to such payment shall be reinstated as though such
payment had been due but not made at such time, but in no event
shall any Guarantor have any liability in excess of the amount
described in Section 2 above.
6. Waiver
by Guarantors . Each Guarantor irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided
for herein, as well as any requirement that at any time any action
be taken by any Person against the Obligor, any other Guarantor,
any Existing Guarantor or any other Person.
7.
Subrogation . Upon making full payment with respect to any
obligation of the Obligor hereunder, a Guarantor shall be
subrogated to the rights of the payee against the Obligor with
respect to such obligation; provided that such Guarantor
shall not enforce any payment by way of subrogation so long as any
Guaranteed Obligation remains unpaid.
8. Stay
of Acceleration . If acceleration of the time for payment of
any Guaranteed Obligation is stayed upon the insolvency, bankruptcy
or reorganization of the Obligor, all such Guaranteed Obligations
otherwise subject to acceleration under the terms of the Parent
Facility or any other Loan Document
shall
nonetheless be payable by the Guarantors hereunder forthwith on
demand by the Beneficiary.
9.
Representations and Warranties . Each Gua
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