$1,050,000,000 Three-Year Revolving Credit Agreement

Retailer Agreement

You are currently viewing:

This Retailer Agreement involves

INTERNATIONAL LEASE FINANCE CORPORATION | CITICORP USA, INC | BANK OF AMERICA, N.A. | BANK OF SCOTLAND | CREDIT SUISSE FIRST BOSTON | CITIGROUP GLOBAL MARKETS INC

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.

Title: $1,050,000,000 Three-Year Revolving Credit Agreement
Date: 3/11/2004

Search Retailer Agreement by:

<PAGE>

Exhibit 10.3

EXECUTION COPY

$1,050,000,000 Three-Year Revolving Credit Agreement

dated as of

October 17, 2003

among

INTERNATIONAL LEASE FINANCE CORPORATION,

THE BANKS (as defined herein)

and

CITICORP USA, INC.,

as Administrative Agent

BANK OF AMERICA, N.A.,

BANK OF SCOTLAND

and

CREDIT SUISSE FIRST BOSTON,

as Co-Documentation Agents,

CITIGROUP GLOBAL MARKETS INC.,

as Sole Arranger and Book Manager

<PAGE>

TABLE OF CONTENTS

<TABLE>

Page

----

<S> <C>

SECTION 1. CERTAIN DEFINITIONS.................................................... 1

Section 1.1. Terms Generally........................................... 1

Section 1.2. Specific Terms............................................ 1

SECTION 2. BID LOANS AND BID NOTES................................................ 11

Section 2.1. Making of Bid Loans....................................... 11

Section 2.2. Procedure for Bid Loans................................... 11

Section 2.3. Funding of Bid Loans...................................... 13

SECTION 3. COMMITTED LOANS AND NOTES.............................................. 14

Section 3.1. Agreement to Make Committed Loans......................... 14

Section 3.2. Procedure for Committed Loans............................. 14

Section 3.3. Maturity of Committed Loans............................... 15

SECTION 4. INTEREST AND FEES...................................................... 15

Section 4.1. Interest Rates............................................ 15

Section 4.2. Interest Payment Dates.................................... 16

Section 4.3. Setting and Notice of Committed Loan Rates................ 16

Section 4.4. Facility Fee.............................................. 17

Section 4.5. Utilization Fee........................................... 17

Section 4.6. Agent's Fees.............................................. 17

Section 4.7. Computation of Interest and Fees.......................... 17

SECTION 5. REDUCTION OR TERMINATION OF THE COMMITMENTS; REPAYMENT; PREPAYMENTS.... 17

Section 5.1. Voluntary Termination or Reduction of the Commitments..... 17

Section 5.2. Voluntary Prepayments..................................... 18

SECTION 6. MAKING AND PRORATION OF PAYMENTS; SET-OFF; TAXES....................... 18

Section 6.1. Making of Payments........................................ 18

Section 6.2. Pro Rata Treatment; Sharing............................... 18

Section 6.3. Set-off................................................... 19

Section 6.4. Taxes, etc................................................ 19

SECTION 7. INCREASED COSTS AND SPECIAL PROVISIONS FOR ABSOLUTE RATE

LOANS AND LIBOR RATE LOANS............................................... 22

Section 7.1. Increased Costs........................................... 23

Section 7.2. Basis for Determining Interest Rate Inadequate or Unfair.. 24

Section 7.3. Changes in Law Rendering Certain Loans Unlawful........... 24

Section 7.4. Funding Losses............................................ 25

Section 7.5. Discretion of Banks as to Manner of Funding............... 25

Section 7.6. Conclusiveness of Statements; Survival of Provisions...... 25

SECTION 8. REPRESENTATIONS AND WARRANTIES......................................... 25

</TABLE>

<PAGE>

<TABLE>

Page

----

<S> <C>

Section 8.1. Organization, etc......................................... 26

Section 8.2. Authorization; Consents; No Conflict...................... 26

Section 8.3. Validity and Binding Nature............................... 26

Section 8.4. Financial Statements...................................... 26

Section 8.5. Litigation and Contingent Liabilities..................... 26

Section 8.6. Employee Benefit Plans.................................... 27

Section 8.7. Investment Company Act.................................... 27

Section 8.8. Public Utility Holding Company Act........................ 27

Section 8.9. Regulation U.............................................. 27

Section 8.10. Information............................................... 27

Section 8.11. Compliance with Applicable Laws, etc...................... 28

Section 8.12. Insurance................................................. 28

Section 8.13. Taxes..................................................... 28

Section 8.14. Use of Proceeds........................................... 28

Section 8.15. Pari Passu................................................ 28

SECTION 9. COVENANTS.............................................................. 28

Section 9.1. Reports, Certificates and Other Information............... 28

Section 9.2. Existence................................................. 30

Section 9.3. Nature of Business........................................ 30

Section 9.4. Books, Records and Access................................. 30

Section 9.5. Insurance................................................. 31

Section 9.6. Repair.................................................... 31

Section 9.7. Taxes..................................................... 31

Section 9.8. Compliance................................................ 31

Section 9.9. Sale of Assets............................................ 31

Section 9.10. Consolidated Indebtedness to Consolidated Tangible Net

Worth Ratio............................................... 31

Section 9.11. Fixed Charge Coverage Ratio............................... 31

Section 9.12. Consolidated Tangible Net Worth........................... 31

Section 9.13. Restricted Payments....................................... 32

Section 9.14. Liens..................................................... 32

Section 9.15. Use of Proceeds........................................... 34

SECTION 10. CONDITIONS TO LENDING................................................. 34

Section 10.1. Conditions Precedent to All Loans......................... 34

Section 10.2. Conditions to the Availability of the Commitments......... 35

SECTION 11. EVENTS OF DEFAULT AND THEIR EFFECT.................................... 36

Section 11.1. Events of Default......................................... 36

Section 11.2. Effect of Event of Default................................ 38

SECTION 12. THE AGENT............................................................. 38

Section 12.1. Authorization............................................. 38

Section 12.2. Indemnification........................................... 38

Section 12.3. Action on Instructions of the Required Banks.............. 39

Section 12.4. Payments.................................................. 39

Section 12.5. Exculpation............................................... 40

</TABLE>

<PAGE>

<TABLE>

Page

----

<S> <C>

Section 12.6. Credit Investigation...................................... 40

Section 12.7. CUSA and Affiliates....................................... 41

Section 12.8. Resignation............................................... 41

Section 12.9. The Register; the Notes................................... 41

SECTION 13. GENERAL............................................................... 42

Section 13.1. Waiver; Amendments........................................ 42

Section 13.2. Notices................................................... 43

Section 13.3. Computations.............................................. 44

Section 13.4. Assignments; Participations............................... 44

Section 13.5. Costs, Expenses and Taxes................................. 47

Section 13.6. Indemnification........................................... 48

Section 13.7. Regulation U.............................................. 48

Section 13.8. Extension of Termination Dates; Removal of Banks;

Substitution of Banks..................................... 48

Section 13.9. Captions.................................................. 50

Section 13.10. Governing Law; Severability............................... 50

Section 13.11. Counterparts; Effectiveness............................... 51

Section 13.12. Further Assurances........................................ 51

Section 13.13. Successors and Assigns.................................... 51

Section 13.14. Waiver of Jury Trial...................................... 51

Section 13.15. No Fiduciary Relationship................................. 51

Section 13.16. Tax Structure Disclosure.................................. 52

</TABLE>

iii

<PAGE>

SCHEDULES AND EXHIBITS

Schedule I Schedule of Banks (Sections 1.2 and 13.8)

Schedule II Fees and Margins (Sections 1.2, 4.4, 4.5 and 4.6)

Schedule III Address for Notices (Section 13.2)

Exhibit A Form of Notice of Competitive Bid Borrowing (Sections 1.2 and

2.2)

Exhibit B Form of Bid (Sections 1.2 and 2.2)

Exhibit C Form of Committed Loan Request (Sections 1.2 and 3.2)

Exhibit D Form of Bid Note (Sections 1.2 and 2.4)

Exhibit E Form of Committed Note (Sections 1.2 and 3.4)

Exhibit F Fixed Charge Coverage Ratio (Sections 1.2 and 9.11)

Exhibit G Form of Opinion of Counsel for the Company (Section 10.2.5)

Exhibit H Form of Opinion of the General Counsel of the Company (Section

10.2.5)

Exhibit I Form of Assignment and Assumption Agreement (Section 13.4.1)

Exhibit J Form of Request for Extension of Termination Date (Section

13.8)

<PAGE>

THREE-YEAR REVOLVING CREDIT AGREEMENT

THREE-YEAR REVOLVING CREDIT AGREEMENT (this "Agreement"),

dated as of October 17, 2003, among INTERNATIONAL LEASE FINANCE CORPORATION, a

California corporation (herein called the "Company"), the financial institutions

listed on the signature pages hereof (herein, together with their respective

successors and assigns, collectively called the "Banks" and individually each

called a "Bank") and CITICORP USA, INC. (herein, in its individual corporate

capacity, together with its successors and assigns, called "CUSA"), as agent for

the Banks (herein, in such capacity, together with its successors and assigns in

such capacity, called the "Agent").

W I T N E S S E T H:

WHEREAS, the Company has requested the Banks to lend up to

$1,050,000,000 to the Company on a three year revolving basis for general

corporate purposes;

NOW, THEREFORE, in consideration of the premises and the

mutual agreements herein contained, the parties hereto agree as follows:

SECTION 1. CERTAIN DEFINITIONS.

Section 1.1. Terms Generally. The definitions ascribed to

terms in this Section 1 and elsewhere in this Agreement shall apply equally to

both the singular and plural forms of the terms defined. Whenever the context

may require, any pronoun shall include the corresponding masculine, feminine and

neuter forms. The words "include", "includes" and "including" shall be deemed to

be followed by the phrase "without limitation". The words "hereby", "herein",

"hereof", "hereunder" and words of similar import refer to this Agreement as a

whole (including any exhibits and schedules hereto) and not merely to the

specific section, paragraph or clause in which such word appears. All references

herein to Sections, Exhibits and Schedules shall be deemed references to

Sections of and Exhibits and Schedules to this Agreement unless the context

shall otherwise require.

Section 1.2. Specific Terms. When used herein, the following

terms shall have the following meanings:

"Absolute Rate" means a rate of interest per annum, expressed

as a percentage to four decimal places and set forth in a Bid for a particular

Bid Loan amount and a particular Loan Period.

"Absolute Rate Loan" means any Loan which bears interest at an

Absolute Rate.

"Affiliate" means, with respect to any Person, any other

Person directly or indirectly controlling, controlled by, or under direct or

indirect common control with such Person. A Person shall be deemed to control

another Person if such first Person possesses, directly or indirectly, the power

to direct or cause the direction of the management and policies of such other

Person, whether through ownership of stock, by contract or otherwise.

Credit Agreement

<PAGE>

-2-

"Agent" - see Preamble.

"Aggregate Commitment" means $1,050,000,000, as reduced by any

reduction in the Commitments made from time to time pursuant to Section 5.1 or

Section 13.8.

"Agreement" - see Preamble.

"AIG" means American International Group, Inc.

"Assignee" - see Section 13.4.1.

"Authorized Officer" of the Company means any of the Chairman

of the Board, the President, the Vice Chair and Chief Financial Officer, the

Treasurer, the Controller and the Assistant Controller of the Company.

"Available Commitment" - see Section 2.2(a).

"Bank" - see Preamble.

"Bank Parties" - see Section 13.6.

"Base LIBOR" means, with respect to any Loan Period for a

LIBOR Rate Loan, (a) the rate per annum for Dollar deposits approximately equal

to the principal amount of the LIBOR Rate Loans for which LIBOR is being

determined and with maturities comparable to the Loan Period for which such rate

would apply, which appears on the Telerate Page 3750 (the "Telerate Page") at

approximately 11:00 A.M., London time, on the day that is two Business Days

prior to the first day of such Loan Period and (b) if no such rate so appears on

the Telerate Page 3750, the rate per annum determined by the Agent to be the

arithmetic mean (rounded to the nearest 1/100 of 1% or, if there is no nearest

1/100 of 1%, to the next higher 1/100 of 1%) of the respective rates of interest

communicated by the Reference Banks to the Agent as the rate at which Dollar

deposits are offered to the Reference Banks by leading banks in the London

interbank deposit market at approximately 11:00 a.m., London time, on the second

full Business Day preceding the first day of such Loan Period in an amount

substantially equal to the amount of such LIBOR Rate Loan for such Reference

Banks and for a period equal to such Loan Period.

"Base Rate" means a fluctuating interest rate per annum, as

shall be in effect from time to time, which rate per annum shall on any day be

equal to the higher of, (a) the rate of interest announced publicly by Citibank,

N.A. in New York, New York, from time to time, as Citibank, N.A.'s base rate;

and (b) the Federal Funds Rate for such day plus -1/2 of 1% per annum.

"Base Rate Loan" means any Loan which bears interest at the

Base Rate.

"Bid" means one or more offers by a Bank to make one or more

Bid Loans, submitted to the Agent by telephone no later than the Submission

Deadline and promptly confirmed in writing on the same day on a duly completed

and executed form substantially

Credit Agreement

<PAGE>

-3-

similar to Exhibit B, personally delivered or transmitted by facsimile to the

Agent.

"Bid Borrowing" - see Section 2.2(a).

"Bid Loan" means a Loan in Dollars that is an Absolute Rate

Loan or a LIBOR Rate Loan made pursuant to Section 2.

"Bid Note" means a promissory note of the Company,

substantially in the form of Exhibit D, duly completed, evidencing Bid Loans

made to the Company, as such note may be amended, modified or supplemented or

supplanted pursuant to Section 13.4.1 from time to time.

"Business Day" means any day of the year on which banks are

open for commercial banking business in the City of New York and Los Angeles

and, if the applicable Business Day relates to the determination of LIBOR for

any LIBOR Rate Loan, any such Business Day on which dealings in deposits in

Dollars are transacted in the London interbank market.

"Capitalized Lease" means any lease under which any

obligations of the lessee are, or are required to be, capitalized on a balance

sheet of the lessee in accordance with generally accepted accounting principles

in the United States of America.

"Capitalized Rentals" means, as of the date of any

determination, the amount at which the obligations of the lessee, due and to

become due under all Capitalized Leases under which the Company or any

Subsidiary is a lessee, are reflected as a liability on a consolidated balance

sheet of the Company and its Subsidiaries.

"Closing Date" - see Section 10.2.

"Code" means the Internal Revenue Code of 1986, as amended.

"Commitments" means the Banks' commitments to make Committed

Loans hereunder; and "Commitment" as to any Bank means the amount set forth

opposite such Bank's name on Schedule I (as reduced in accordance with Section

5.1, or as periodically revised in accordance with Section 13.4 or Section

13.8).

"Committed Loan" means a Loan in Dollars that is a Base Rate

Loan or LIBOR Rate Loan made pursuant to Section 3.

"Committed Loan Request" - see Section 3.2(a).

"Committed Note" means a promissory note of the Company,

substantially in the form of Exhibit E, duly completed, evidencing Committed

Loans to the Company, as such note may be amended, modified or supplemented or

supplanted pursuant to Section 13.4.1 from time to time.

"Company" - see Preamble.

Credit Agreement

<PAGE>

-4-

"Consolidated Indebtedness" means, as of the date of any

determination, the total amount of Indebtedness, less the amount of current and

deferred income taxes and rentals received in advance of the Company and its

Subsidiaries determined on a consolidated basis in accordance with generally

accepted accounting principles in the United States of America.

"Consolidated Tangible Net Assets" means, as of the date of

any determination, the total amount of assets (less depreciation and valuation

reserves and other reserves and items deductible from the gross book value of

specific asset amounts under generally accepted accounting principles) which

under generally accepted accounting principles would be included on a balance

sheet of the Company and its Subsidiaries, after deducting therefrom (i) all

liability items except Indebtedness (whether incurred, assumed or guaranteed)

for borrowed money maturing by its terms more than one year from the date of

creation thereof or which is extendible or renewable at the sole option of the

obligor in such manner that it may become payable more than one year from the

date of creation thereof, shareholder's equity and reserves for deferred income

taxes and (ii) all good will, trade names, trademarks, patents, unamortized debt

discount and expense and other like intangibles, which in each case would be so

included on such balance sheet.

"Consolidated Tangible Net Worth" means, as of the date of any

determination, the total of shareholders' equity (including capital stock,

additional paid-in capital and retained earnings after deducting treasury

stock), less the sum of the total amount of goodwill, organization expenses,

unamortized debt issue costs (determined on an after-tax basis), deferred assets

other than prepaid insurance and prepaid taxes, the excess of cost of shares

acquired over book value of related assets, surplus resulting from any

revaluation write-up of assets subsequent to December 31, 2002 and such other

assets as are properly classified as intangible assets, all determined in

accordance with generally accepted accounting principles in the United States of

America consolidating the Company and its Subsidiaries.

"Covered Taxes" means all Taxes, including all liabilities

(including, without limitation, any penalties, interest and other additions to

tax) with respect thereto, other than the following Taxes, including all

liabilities (including, without limitation, any penalties, interest and other

additions to tax) with respect thereto: (i) Taxes imposed on the net income or

capital of the Agent, a Bank, Assignee or Participant under this Agreement and

franchise taxes imposed in lieu thereof (including without limitation branch

profits taxes, minimum taxes and taxes computed under alternative methods, at

least one of which is based on net income (collectively referred to as "net

income taxes")) by (A) the jurisdiction under the laws of which such Agent,

Bank, Assignee or Participant under this Agreement is organized or resident for

tax purposes or any political subdivision thereof or (B) the jurisdiction of

such Agent, Bank, Assignee or Participant's applicable lending office or any

political subdivision thereof or (C) any jurisdiction with which such Agent,

Bank, Assignee or Participant has any present or former connection (other than

solely by virtue of being a Bank under this Agreement), (ii) any Taxes to the

extent that they are in effect and would apply to a payment to such Agent, Bank,

Assignee or Participant as of the date of a change in the jurisdiction of such

Agent, Bank, Assignee or Participant's applicable lending office or (iii) any

Taxes that would not have been imposed but for (A) the failure or unreasonable

delay by such Agent, Bank, Assignee or Participant, as

Credit Agreement

<PAGE>

-5-

applicable, to complete, provide, or file and update or renew, any application

forms, certificates, documents or other evidence required from time to time,

properly completed and duly executed, to qualify for any applicable exemption

from or reduction of Taxes, including, without limitation, the certificates,

documents or other evidence required under Sections 6.4(b), 6.4(c) and 6.4(e)

(unless such failure or delay results from a change in applicable law after the

Closing Date or the date of the applicable agreement pursuant to which such

Assignee or Participant, as the case may be, acquires an interest under this

Agreement, which precludes such Agent, Bank, Assignee or Participant, as

applicable, from qualifying for such exemption or reduction) or (B) the gross

negligence or willful misconduct of such Agent, Bank, Assignee or Participant.

"CUSA" - see Preamble.

"Dollar", and $, refer to the lawful money of the United

States of America.

"ECA Financing" means any subsidized financing of the

acquisition of Airbus Industrie aircraft, the repayment obligations of which

will be supported by guaranties issued by certain European government export

credit agencies (the European Credit Agency Export Finance Program) and a

Company Guaranty and a pledge of the assets of (including any rights to or

interests in any reserve or security deposit held by) each such Wholly-owned

Subsidiary.

"Eligible Assignee" means (i) any Bank, and any Affiliate of

any Bank and (ii)(a) a commercial bank organized under the laws of the United

States or any state thereof, (b) a savings and loan association or savings bank

organized under the laws of the United States or any state thereof, (c) a

commercial bank organized under the laws of any other country or a political

subdivision thereof; provided that (1) such bank is acting through a branch or

agency located in the United States or (2) such bank organized under the laws of

a country that is a member of the Organization for Economic Cooperation and

Development or a political subdivision of such country and (d) a finance

company, insurance company, mutual fund, leasing company or other financial

institution or fund (whether a corporation, partnership or other entity) which

is engaged in making, purchasing or otherwise investing in commercial loans in

the ordinary course of its business, and having total assets in excess of

$150,000,000.

"ERISA" means the Employee Retirement Income Security Act of

1974, as amended.

"ERISA Affiliate" means any corporation, trade or business

that is, along with the Company or any Subsidiary, a member of a controlled

group of corporations or a controlled group of trades or businesses, as

described in sections 414(b) and 414(c), respectively, of the Code or Section

4001 of ERISA.

"Eurodollar Reserve Percentage" means for any day in any Loan

Period for any LIBOR Rate Loan that percentage in effect on such day as

prescribed by the Board of Governors of the Federal Reserve System (or any

successor thereto) or other U.S. government agency for determining the reserve

requirement (including, without limitation, any marginal, basic, supplemental or

emergency reserves) for a member bank of the Federal Reserve System in New York

City with deposits exceeding one billion dollars in respect of eurocurrency

funding

Credit Agreement

<PAGE>

-6-

liabilities. LIBOR shall be adjusted automatically on and as of the effective

date of any change in the Eurodollar Reserve Percentage.

"Event of Default" means any of the events described in

Section 11.1.

"Eximbank" means the Export-Import Bank of the United States.

"Existing Litigation" - see Section 10.1.3.

"FASB 13" means the Statement of Financial Accounting

Standards No. 13 (Accounting for Leases) as in effect on the date hereof.

"Federal Funds Rate" means, for any period, a fluctuating

interest rate per annum equal for each day during such period to the weighted

average of the rates on overnight Federal funds transactions with members of the

Federal Reserve System arranged by Federal funds brokers, as published for such

day (or, if such day is not a Business Day, for the next preceding Business Day)

by the Federal Reserve Bank of New York, or, if such rate is not so published

for any day which is a Business Day, the average of the quotations for such day

on such transactions received by the Agent from three Federal funds brokers of

recognized standing selected by it.

"Fixed Charge Coverage Ratio" on the last day of any quarter

of any fiscal year of the Company means the ratio for the period of four fiscal

quarters ending on such day of earnings to combined fixed charges and preferred

stock dividends referred to in Paragraph (d)(1) of Item 503 of Regulation S-K of

the Securities and Exchange Commission, as amended from time to time, and

determined pursuant to Instructions to paragraph 503(d) of such Item 503 with

the Company as "registrant" (such ratio for the four fiscal quarters ended

December 31, 2002 is attached hereto as Exhibit F); provided, however, that if

the Required Banks in their reasonable discretion determine that amendments to

Regulation S-K subsequent to the date hereof substantially modify the provisions

of such Item 503, "Fixed Charge Coverage Ratio" shall have the meaning

determined by this definition without regard to any such amendments.

"Funding Date" means the date on which any Loan is scheduled

to be disbursed.

"Funding Office" means, with respect to any Bank, any office

or offices of such Bank or Affiliate or Affiliates of such Bank through which

such Bank shall fund or shall have funded any Loan. A Funding Office may be, at

such Bank's option, either a domestic or foreign office of such Bank or a

domestic or foreign office of an Affiliate of such Bank.

"Governmental Authority" means any nation or government, any

state or other political subdivision thereof and any entity exercising

executive, legislative, judicial, regulatory or administrative functions of or

pertaining to government.

"Guaranties" by any Person means, without duplication, all

obligations (other than endorsements in the ordinary course of business of

negotiable instruments for deposit or collection) of such Person guaranteeing or

in effect guaranteeing any Indebtedness, dividend or other obligation of any

other Person (the "Primary Obligor") in any manner, whether directly or

Credit Agreement

<PAGE>

-7-

indirectly, including, without limitation, all obligations incurred through an

agreement, contingent or otherwise, by such Person: (a) to purchase such

Indebtedness or obligation or any property or assets constituting security

therefor, (b) to advance or supply funds (i) for the purchase or payment of such

Indebtedness or obligation or (ii) to maintain working capital or other balance

sheet condition or otherwise to advance or make available funds for the purchase

or payment of such Indebtedness or obligation, (c) to lease property or to

purchase securities or other property or services primarily for the purpose of

assuring the owner of such Indebtedness or obligation of the ability of the

Primary Obligor to make payment of the Indebtedness or obligation or (d)

otherwise to assure the owner of the Indebtedness or obligation of the Primary

Obligor against loss in respect thereof; provided, however, that the obligation

described in clause (c) shall not include (i) obligations of a buyer under an

agreement with a seller to purchase goods or services entered into in the

ordinary course of such buyer's and seller's businesses unless such agreement

requires that such buyer make payment whether or not delivery is ever made of

such goods or services and (ii) remarketing agreements where the remaining debt

on an aircraft does not exceed the aircraft's net book value, determined in

accordance with industry standards, except that clause (c) shall apply to the

amount of remaining debt under a remarketing agreement that exceeds the net book

value of the aircraft. For the purposes of all computations made under this

Agreement, a Guaranty in respect of any Indebtedness for borrowed money shall be

deemed to be Indebtedness equal to the principal amount of such Indebtedness for

borrowed money which has been guaranteed, and a Guaranty in respect of any other

obligation or liability or any dividend shall be deemed to be Indebtedness equal

to the maximum aggregate amount of such obligation, liability or dividend.

"Indebtedness" of any Person means and includes, without

duplication, all obligations of such Person which in accordance with generally

accepted accounting principles in the United States of America shall be

classified upon a balance sheet of such Person as liabilities of such Person,

and in any event shall include all:

(a) obligations of such Person for borrowed money or which

have been incurred in connection with the acquisition of property or

assets (other than security and other deposits on flight equipment),

(b) obligations secured by any Lien or other charge upon

property or assets owned by such Person, even though such Person has

not assumed or become liable for the payment of such obligations,

or other title retention agreement with respect to property acquired by

such Person, notwithstanding the fact that the rights and remedies of

the seller, lender or lessor under such agreement in the event of

default are limited to repossession or sale of property,

(d) Capitalized Rentals of such Person under any Capitalized

Lease,

(e) obligations evidenced by bonds, debentures, notes or other

similar instruments, and

Credit Agreement

<PAGE>

-8-

(f) Guaranties by such Person, to the extent required pursuant

to the definition thereof.

"Indemnified Liabilities" - see Section 13.6.

"LIBOR" means, with respect to any Loan Period the rate per

annum (rounded to the nearest 1/100 of 1% or, if there is no nearest 1/100 of

1%, to the next higher 1/100 of 1%), determined pursuant to the following

formula:

Base LIBOR

LIBOR= ----------------------------------------------

(1 - Eurodollar Reserve Percentage)

"LIBOR Rate" means (i) with respect to Committed Loans that

are LIBOR Rate Loans, LIBOR plus the applicable rate margin set forth in

Schedule II and (ii) with respect to Bid Loans that are LIBOR Rate Loans, LIBOR

plus or minus the rate margin set forth in a Bid for a particular Bid Loan

amount and a particular Loan Period.

"LIBOR Rate Loan" means any Loan which bears interest at a

LIBOR Rate.

"Lien" means any mortgage, pledge, lien, security interest or

other charge, encumbrance or preferential arrangement, including the retained

security title of a conditional vendor or lessor. For avoidance of doubt, the

parties hereto acknowledge that the filing of a financing statement under the

Uniform Commercial Code does not, in and of itself, give rise to a Lien.

"Litigation Actions" means all litigation, claims and

arbitration proceedings, proceedings before any Governmental Authority or

investigations which are pending or, to the knowledge of the Company, threatened

against, or affecting, the Company or any Subsidiary.

"Loan Period" means (i) with respect to any Absolute Rate

Loan, the period commencing on such Loan's Funding Date and ending not less than

14 days thereafter nor more than 6 months thereafter as specified in the Bid

Loan Request related to such Bid Loan and (ii) with respect to any LIBOR Rate

Loan, the period commencing on such Loan's Funding Date and ending 1, 2, 3 or 6

months thereafter as selected by the Company pursuant to Section 3.2(a) or

specified in the Notice of Competitive Bid Borrowing, as the case may be;

provided, however, that:

(a) if a Loan Period would otherwise end on a day which is not

a Business Day, such Loan Period shall end on the next succeeding

Business Day (unless, in the case of a LIBOR Rate Loan, such next

succeeding Business Day would fall in the next succeeding calendar

month, in which case such Loan Period shall end on the next preceding

Business Day),

(b) in the case of a Loan Period for any LIBOR Rate Loan, if

there exists no day numerically corresponding to the day such Loan was

made in the month in which the last

Credit Agreement

<PAGE>

-9-

day of such Loan Period would otherwise fall, such Loan Period shall

end on the last Business Day of such month, and

Period for such Loan shall not extend beyond the then-scheduled

Termination Date for such Bank.

"Loans" means, collectively, the Bid Loans and the Committed

Loans and, individually, any Bid Loan or Committed Loan.

"Material Adverse Effect" means (i) any material adverse

effect on the business, properties, condition (financial or otherwise) or

operations of the Company and its Subsidiaries, taken as a whole since any

stated reference date or from and after the date of determination, as the case

may be, (ii) any material adverse effect on the ability of the Company to

perform its material obligations hereunder and under the Notes or (iii) any

material adverse effect on the legality, validity, binding effect or

enforceability of any material provision of this Agreement or any Note.

"Multiemployer Plan" has the meaning assigned to such term in

Section 3(37) of ERISA.

"New Litigation" - see Section 10.1.3.

"Notes" means, collectively, the Bid Notes and the Committed

Notes; and "Note" means any individual Bid Note or Committed Note.

"Notice of Competitive Bid Borrowing" - see Section 2.2(a).

"Notice Office" means the office of CUSA which, as of the date

hereof, is located at 2 Penns Way, Suite 200, New Castle, DE 19720, Telecopy

Number 302-894-6005; Telephone 302-894-6120.

"Participant" - see Section 13.4.2.

"Payment Office" means the office of the Agent which, as of

the date hereof, is at 2 Penns Way, Suite 200, New Castle, DE 19720, Account

Number: 36852248.

"PBGC" means the Pension Benefit Guaranty Corporation and any

entity succeeding to any or all of its functions under ERISA.

"Percentage" means as to any Bank the ratio, expressed as a

percentage, that such Bank's Commitment as set forth opposite such Bank's name

on Schedule I, as periodically revised in accordance with Section 13.4 or 13.8,

bears to the Aggregate Commitment or, if the Commitments have been terminated,

the ratio, expressed as a percentage, that the aggregate principal amount of

such Bank's outstanding Loans bears to the aggregate principal amount of all

outstanding Loans.

Credit Agreement

<PAGE>

-10-

"Person" means an individual or a corporation, partnership,

trust, incorporated or unincorporated association, joint venture, joint stock

company, government (or an agency or political subdivision thereof) or other

entity of any kind.

"Plan" means, at any date, any employee pension benefit plan

(as defined in section 3(2) of ERISA) which is subject to Title IV of ERISA

(other than a Multiemployer Plan) and to which the Company or any ERISA

Affiliate may have any liability, including any liability by reason of having

been a substantial employer within the meaning of section 4063 of ERISA at any

time during the preceding five years, or by reason of being deemed to be a

contributing sponsor under section 4069 of ERISA.

"Reference Banks" means Citibank, N.A., Bank of America, N.A.

and The Governor and Company of the Bank of Scotland.

"Reportable Event" means an event described in Section 4043(c)

of ERISA with respect to a Plan other than those events as to which the 30-day

notice period is waived under subsection .22, .23, .25, .27 or .28 of PBGC

Regulation Section 4043.

"Required Banks" means Banks having an aggregate Percentage of

51% or more.

"Significant Subsidiary" means any Subsidiary which is so

defined pursuant to Rule 1-02 of Regulation S-X promulgated by the Securities

and Exchange Commission.

"Submission Deadline" - see Section 2.2(b).

"Subsidiary" means any Person of which or in which the Company

and its other Subsidiaries own directly or indirectly 50% or more of:

(a) the combined voting power of all classes of stock having

general voting power under ordinary circumstances to elect a majority

of the board of directors of such Person, if it is a corporation,

(b) the capital interest or profits interest of such Person,

if it is a partnership, joint venture or similar entity, or

association or other unincorporated organization.

"Successor Bank" - see Section 13.8(c).

"Taxes" with respect to any Person means income, excise and

other taxes, and all assessments, imposts, duties and other governmental charges

or levies, imposed upon such Person, its income or any of its properties,

franchises or assets by any Governmental Authority.

"Telerate Page" - see "Base LIBOR".

Credit Agreement

<PAGE>

-11-

"Terminating Bank" - see Section 13.8(c).

"Termination Date" means, with respect to any Bank, the

earliest to occur of (i) October 17, 2006 or such later date as may be agreed to

by such Bank pursuant to Section 13.8(a), or if such day is not a Business Day,

the next preceding Business Day, (ii) the date on which the Commitments shall

terminate pursuant to Section 11.2 or the Commitments shall be reduced to zero

pursuant to Section 5.1 and (iii) the date specified as such Bank's Termination

Date pursuant to Section 13.8(b), or, if such day is not a Business Day, the

next preceding Business Day; in all cases, subject to the provisions of Section

13.8(d).

"Unmatured Event of Default" means any event which if it

continues uncured will, with lapse of time or notice or lapse of time and

notice, constitute an Event of Default.

"Wholly-owned Subsidiary" means any Person of which or in

which the Company and its other Wholly-owned Subsidiaries own directly or

indirectly 100% of:

(a) the issued and outstanding shares of stock (except shares

required as directors, qualifying shares),

(b) the capital interest or profits interest of such Person,

if it is a partnership, joint venture or similar entity, or

association or other unincorporated organization.

SECTION 2. BID LOANS AND BID NOTES.

Section 2.1. Making of Bid Loans. On the terms and subject to

the conditions of this Agreement, each Bank, severally and for itself alone, may

(but is not obligated to) make Bid Loans to the Company from time to time on or

after the date hereof and prior to the date which is the fourteenth day

preceding such Bank's Termination Date in amounts equal to such Bank's Bids that

have been accepted as provided in Section 2.2(c); provided, that the aggregate

principal amount of all outstanding Loans shall not at any time exceed the then

Aggregate Commitment.

Section 2.2. Procedure for Bid Loans.

(a) Bid Loan Request. Whenever the Company desires to incur a

competitive bid borrowing (a "Bid Borrowing"), it shall give the Agent written

notice (or telephonic notice promptly confirmed in writing), such notice to be

delivered to the Agent at its Notice Office no later than 12:00 Noon, New York

City time, at least three Business Days prior to any proposed LIBOR Rate Loan

and at least one Business Day prior to any proposed Absolute Rate Loan. Each

such notice shall be substantially in the form of Exhibit A hereto (each a

"Notice of Competitive Bid Borrowing"), and shall specify in each case (i) the

date of such proposed Bid Borrowing (which shall be a Business Day), (ii) the

aggregate amount of the proposed Bid Borrowing, (iii) whether the proposed Bid

Borrowing is to be an Absolute Rate Loan or a LIBOR Rate Loan and the Loan

Period, (iv) the maturity date for repayment of each Bid Loan to be made as part

of such borrowing (which maturity date shall not be earlier than one month after

Credit Agreement

<PAGE>

-12-

the date of any proposed LIBOR Rate Loan or 14 days after the date of any

proposed Absolute Rate Loan or later than the earliest to occur of (x) six

months after the date of such proposed Bid Loan, (y) the Termination Date and

(z) if the proposed Bid Loan has an interest rate that is the LIBOR Rate, the

last day of the proposed Loan Period), (v) the interest payment date or dates

relating thereto, (vi) the account to which the proceeds of such Bid Borrowing

are to be credited and (vii) any other terms to be applicable to such Bid

Borrowing. The Agent shall promptly give each Bank written notice (or telephonic

notice promptly confirmed in writing) of each such request for a Bid Borrowing

received by it from the Company. Each Notice of Competitive Bid Borrowing shall

contemplate Bid Loans in a minimum aggregate principal amount of $10,000,000 or

a higher integral multiple of $1,000,000, not to exceed, however, the excess of

the then Aggregate Commitment over the aggregate principal amount of all

outstanding Loans, calculated as of the relevant Funding Date, assuming that the

Company will pay, when due, all Loans maturing on or prior to such Funding Date

(the "Available Commitment").

(b) Bidding Procedure. Each Bank shall, if in its sole

discretion it elects to do so, irrevocably offer to make one or more Bid Loans

to the Company as part of such proposed Bid Borrowing at a rate or rates of

interest specified by such Bank in its sole discretion and determined by such

Bank independently of each other Bank, by notifying by telephone confirmed in

writing to the Agent at its Notice Office (which shall give prompt notice

thereof to the Company), before 10:00 a.m., New York City time, on the date (the

"Submission Deadline") that is (x) in the case of a proposed Absolute Rate Loan,

the same day as the date of such proposed Bid Loan and (y) in the case of a

proposed LIBOR Rate Loan, two Business Days before the date of such proposed Bid

Loan. Each Bid shall be substantially in the form of Exhibit B (each a "Bid"),

and shall specify in each case (i) the Loan Period, (ii) the minimum amount and

maximum amount of each Bid Loan that such Bank would be willing to make as part

of such proposed Bid Borrowing (which amounts may, subject to the proviso in

Section 2.1, exceed such Bank's Commitment), (iii) the rate or rates of interest

therefor and (iv) such Bank's lending office with respect to such Bid Loan;

provided, that if the Agent in its capacity as a Bank shall, in its sole

discretion, elect to make any such offer, it shall notify the Company of such

offer before 8:30 a.m., New York City time, on the Submission Deadline.

10:30 a.m., New York City time, on the Submission Deadline, either:

(i) cancel such proposed Bid Borrowing by giving the Agent

notice to that effect, or

(ii) accept (such acceptance to be irrevocable) one or more of

the offers made by any Bank or Banks pursuant to clause (b) above by

giving notice (in writing or by telephone confirmed in writing) to the

Agent of the amount of each Bid Loan (which amount shall be equal to or

greater than the minimum amount, and equal to or less than the maximum

amount, notified to the Company by the Agent on behalf of such Bank for

such Bid Borrowing pursuant to clause (b) above) to be made by such

Bank as part of such Bid Borrowing, and reject any remaining offers

made by any Bank pursuant to clause (b) above by giving the Agent

notice to that effect; provided, that for any maturity date acceptance

of offers may only be made on the basis of ascending Absolute Rates (in

Credit Agreement

<PAGE>

-13-

the case of an Absolute Rate Loan) or floating rates (in the case of a

LIBOR Rate Loan), in each case commencing with the lowest rate so

offered and only as to offers made in conformity with the terms hereof;

provided, further, however, if offers are made by two or more Banks at

the same rate or rates and acceptance of all such equal offers would

result in a greater principal amount of Bid Loans being accepted than

the aggregate principal amount requested by the Company, the Company

shall have the right to accept one or more of such equal offers in

their entirety and reject the other equal offer or offers or to

allocate acceptance among all such equal offers (but giving effect to

the minimum and maximum amounts specified for each such offer pursuant

to clause (b) above), as the Company may elect in its sole discretion.

The Company may not accept offers whose aggregate principal amount is

greater than the requested aggregate amount as specified in the related

Notice of Competitive Bid Borrowing, subject to the proviso in Section

2.1.

(d) Cancellation of Bid Borrowing. If the Company notifies the

Agent that such proposed Bid Borrowing is cancelled pursuant to clause (c)(i)

above, the Agent shall give prompt notice thereof to the Banks and such Bid

Borrowing shall not be made.

(e) Notification of Acceptance. If the Company accepts one or

more of the offers made by any Bank or Banks pursuant to clause (c)(ii) above,

the Agent shall in turn promptly notify (x) each Bank that has made an offer as

desc