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EXECUTION COPY
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FOURTH AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT
among
RAYTHEON AIRCRAFT CREDIT CORPORATION,
as Servicer,
RAYTHEON AIRCRAFT RECEIVABLES CORPORATION,
as Seller,
THE PURCHASERS REFERRED TO HEREIN,
BANK OF AMERICA, N.A.,
as Managing Facility Agent and Documentation Agent,
JPMORGAN CHASE BANK,
and
BANK OF AMERICA, N.A.,
as Co-Administrative Agents,
J.P. MORGAN SECURITIES INC.,
and
BANC OF AMERICA SECURITIES LLC,
as Co-Arrangers
and
Joint Bookrunners,
J.P. MORGAN SECURITIES INC.,
as Syndication Agent,
CITIBANK, N.A.,
CREDIT SUISSE FIRST BOSTON
and
FLEET SECURITIES, INC.
as Co-Documentation Agents,
and
EACH ADMINISTRATIVE AGENT REFERRED TO HEREIN
Dated as of March 8, 2002
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Table of Contents
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Page
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SECTION 1. DEFINITIONS.....................................................................................2
1.1 Defined Terms.....................................................................................2
1.2 Other Definitional Provisions....................................................................41
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS................................................................42
2.1 Agreement to Purchase and Sell; Special Purpose Purchasers; Initial Utilization
and Pro Ration...................................................................................42
2.2 Procedures for Making Purchases..................................................................42
2.3 Special Settlement Dates.........................................................................43
2.4 Participated Receivables.........................................................................43
2.5 Extended Term Receivables........................................................................44
2.6 Certain Actions Following a Rating Event and a Discount Event....................................45
2.6A. Certain Actions Following a Discount Event......................................................47
2.7 Concentration Limits.............................................................................47
2.8 Term of Revolving Period.........................................................................49
2.9 Termination or Reduction of Commitments..........................................................51
2.10 Defaulted Receivables; Application of Lease Security Deposits...................................52
2.10A Delinquent Receivables.........................................................................53
2.11 Ineligible Receivables...........................................................................54
2.12 Rebated Receivables..............................................................................55
2.13 Substitution of Receivables......................................................................55
2.14 Accounts.........................................................................................58
2.15 Remittance and Allocation of Collections.........................................................61
2.16 Distribution and Application of Collections......................................................62
2.17 Interest and Fees................................................................................64
2.18 Yield Adjustment.................................................................................65
2.19 Computations and Payments........................................................................65
2.20 Pro Rata Treatment...............................................................................66
2.21 Illegality.......................................................................................67
2.22 Requirements of Law..............................................................................67
2.23 Taxes............................................................................................68
2.24 Reemployment Costs...............................................................................69
2.25 Seller's Obligations Absolute and Unconditional..................................................69
2.26 Mitigation Obligations; Replacement of Purchaser.................................................70
2.27 Designation of Affiliate Receivables and Foreign Receivables.....................................70
SECTION 3. THE SERVICER AND SERVICING OF PURCHASED RECEIVABLES............................................76
3.1 Designation of Servicer; Removal.................................................................76
3.2 Duties of Servicer...............................................................................77
3.3 Servicer Reports.................................................................................77
3.4 Servicing Fee....................................................................................78
3.5 Merger or Consolidation of, or Assumption of the Obligations of, the Servicer....................78
3.6 Limitation on Liability of the Servicer and Others...............................................79
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3.7 Indemnification of the Seller, the Managing Facility Agent, the Administrative Agent, the
Co-Administrative Agents and each Purchaser......................................................79
3.8 The Servicer Not to Resign.......................................................................80
3.9 Access to Certain Documentation and Information Regarding the Contracts..........................80
3.10 Marking of Records..............................................................................80
3.11 Additional Covenants of the Servicer............................................................80
(a) Contract Files...........................................................................80
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(b) Compliance with Law......................................................................81
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(c) Preservation of Security Interest........................................................81
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(d) Obligations with Respect to Contracts; Modifications.....................................81
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(e) No Bankruptcy Petition...................................................................81
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SECTION 4. REPRESENTATIONS AND WARRANTIES.................................................................82
4.1 Representations and Warranties Relating to the Seller............................................82
(a) Corporate Existence; Compliance with Law.................................................82
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(b) Corporate Power; Authorization; Enforceable Obligations..................................82
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(c) No Legal Bar.............................................................................83
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(d) No Material Litigation...................................................................83
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(e) No Default...............................................................................83
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(f) Federal Regulations......................................................................83
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(g) ERISA....................................................................................83
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(h) Investment Company Act; Other Regulations................................................84
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(i) Place of Business........................................................................84
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(j) Information..............................................................................84
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4.2 Representations and Warranties Relating to the Receivables.......................................84
(a) Eligible Receivables.....................................................................84
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(b) Ownership or Perfected First Security Interest...........................................85
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(c) Assignment...............................................................................85
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(d) No Material Adverse Change...............................................................85
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(e) Substituted Receivables..................................................................86
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(f) No Violation.............................................................................86
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(g) Entitlement to Section 1110 Benefits.....................................................86
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(h) Stipulated Aircraft Value................................................................86
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(i) Finance Charge Collections...............................................................86
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4.3 Representations and Warranties Relating to the Servicer..........................................86
(a) Corporate Existence; Compliance with Law.................................................87
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(b) Corporate Power; Authorization; Enforceable Obligations..................................87
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(c) No Legal Bar.............................................................................87
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(d) No Material Litigation...................................................................88
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(e) No Default...............................................................................88
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(f) ERISA....................................................................................88
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(g) Investment Company Act; Other Regulations................................................88
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(h) Place of Business........................................................................88
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(i) Information..............................................................................89
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SECTION 5. CONDITIONS PRECEDENT...........................................................................89
5.1 Conditions to Effectiveness......................................................................89
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(a) Purchase and Other Documents.............................................................89
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(b) Corporate Proceedings and Contracts......................................................89
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(c) Corporate Documents; Good Standing Certificates..........................................89
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(d) Evidence of Incumbency...................................................................90
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(e) Officer's Certificates...................................................................90
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(f) Legal Opinions...........................................................................90
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(g) Fees.....................................................................................91
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(h) Amendment to the Intercompany Purchase Agreement.........................................91
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5.2 Conditions to Each Purchase or Substitution......................................................91
(a) Representations and Warranties...........................................................91
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(b) Amortization Event.......................................................................92
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(c) Settlement Statement.....................................................................92
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(d) Assignments..............................................................................92
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(e) Perfection Matters.......................................................................92
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(f) Certificates.............................................................................94
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(g) Marking Records..........................................................................94
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(h) L/C Receivables..........................................................................94
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(i) Refinanced Aircraft......................................................................94
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(j) Purchase Report..........................................................................94
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(k) Additional Documents.....................................................................94
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(l) Additional Matters.......................................................................94
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5.3 Reallocation of Commitments; Addition of New Purchasers..........................................95
SECTION 6. AFFIRMATIVE COVENANTS..........................................................................96
6.1 Affirmative Covenants of the Seller..............................................................96
(a) Reporting Requirements...................................................................96
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(b) Compliance with Laws, Etc................................................................98
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(c) Conduct of Business and Maintenance of Existence.........................................98
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(d) Maintenance of Property; Insurance.......................................................98
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(e) Keeping of Records and Books of Account..................................................98
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(f) Location of Records......................................................................99
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(g) Access...................................................................................99
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(h) Marking of Records.......................................................................99
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(i) Credit and Collection Policy............................................................100
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(j) Performance and Compliance with Receivables and Contracts...............................100
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(k) [Intentionally omitted.]................................................................100
(l) Further Action Evidencing Interests of Administrative Agent and Purchasers..............100
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(m) Separate Corporate Existence............................................................101
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(n) Existing Receivables Perfection Matters.................................................101
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6.2 Affirmative Covenants of the Servicer...........................................................102
(a) Compliance with Laws, Etc...............................................................102
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(b) Conduct of Business and Maintenance of Existence........................................102
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(c) Maintenance of Property; Insurance......................................................102
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(d) Keeping of Records and Books of Account.................................................103
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(e) Location of Records.....................................................................103
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(f) Access..................................................................................103
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(g) Credit and Collection Policy............................................................104
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(h) Ownership of Affiliate Obligors.........................................................104
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SECTION 7. NEGATIVE COVENANTS............................................................................104
7.1 Negative Covenants of the Seller................................................................104
(a) Sales, Liens, Etc.......................................................................104
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(b) Extension or Amendment of Purchased Receivables.........................................104
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(c) Change in Business or Credit and Collection Policy......................................106
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(d) No Actions against Obligors.............................................................106
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(e) Security Interest to Remain in Force....................................................106
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(f) Limitations on Fundamental Changes......................................................107
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(g) Transactions with Affiliates............................................................107
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(h) Fiscal Year.............................................................................107
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(i) Assignment of Contracts.................................................................107
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(j) Substitution of Engines.................................................................107
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(k) Indebtedness............................................................................107
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(l) Guarantees..............................................................................108
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(m) Investments.............................................................................108
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(n) Distributions...........................................................................108
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(o) Agreements..............................................................................108
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(p) Intercompany Purchase Agreement.........................................................108
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7.2 Negative Covenants of the Servicer..............................................................109
(a) No Actions against Obligors.............................................................109
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(b) Security Interest to Remain in Force....................................................109
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(c) Limitations on Fundamental Changes......................................................109
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(d) Transactions with Affiliates............................................................109
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(e) Assignment of Contracts.................................................................109
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(f) Change in Credit and Collection Policy..................................................109
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SECTION 8. AMORTIZATION EVENTS...........................................................................110
8.1 Amortization Events.............................................................................110
8.2 Rights and Remedies.............................................................................113
8.3 Waivers.........................................................................................115
SECTION 9. INDEMNIFICATIONS..............................................................................115
9.1 Indemnities of the Seller.......................................................................115
9.2 Limitations of Seller's Liability...............................................................117
9.3 Proceedings against Indemnified Person..........................................................118
SECTION 10. THE MANAGING FACILITY AGENT AND ADMINISTRATIVE AGENT.........................................119
10.1 Appointment.....................................................................................119
10.2 Delegation of Duties............................................................................119
10.3 Exculpatory Provisions..........................................................................120
10.4 Reliance by Managing Facility Agent and Administrative Agent....................................120
10.5 Notice of Certain Events........................................................................121
10.6 Non-Reliance on Managing Facility Agent, the Administrative Agent, the Co-Administrative
Agents and the Purchasers.......................................................................121
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10.7 Indemnification.................................................................................122
10.8 Managing Facility Agent and Administrative Agent in Their Individual Capacities.................122
10.9 Successor Managing Facility Agent or Administrative Agent.......................................122
SECTION 11. MISCELLANEOUS................................................................................123
11.1 Amendments and Waivers..........................................................................123
11.2 Notices.........................................................................................124
11.3 No Waiver; Cumulative Remedies..................................................................125
11.4 Survival of Representations and Warranties......................................................126
11.5 Payment of Expenses and Taxes...................................................................126
11.6 Successors and Assigns; Participations; Purchasing Parties......................................126
11.7 Adjustments; Set-off............................................................................129
11.8 Responsibilities of the Seller..................................................................130
11.9 Optional Repurchase.............................................................................130
11.10 Reassignments..................................................................................131
11.11 Intention of the Parties; Lien on Intercompany Purchase Agreement.............................132
11.12 Leases; Grant of Security Interest.............................................................134
11.13 Power of Attorney..............................................................................136
11.14 Counterparts...................................................................................137
11.15 Severability; Headings.........................................................................138
11.16 Integration....................................................................................138
11.17 GOVERNING LAW..................................................................................138
11.18 Submission To Jurisdiction; Waivers............................................................138
11.19 Acknowledgements...............................................................................139
11.20 WAIVERS OF JURY TRIAL..........................................................................139
11.21 Bankruptcy Petition............................................................................139
11.22 Confidentiality................................................................................140
11.23 Claims Against SPCs............................................................................140
11.24 Resales........................................................................................141
11.25 Repurchase of Delinquent Receivables...........................................................142
11.26 Amendment to Repurchase Agreement..............................................................142
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SCHEDULES AND EXHIBITS
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Schedule I Commitments and Purchaser Information
Schedule II UCC Filing Locations
Schedule III Prohibited Foreign Jurisdictions
Schedule IV Specified Resales
Exhibit A-1 Form of Assignment
Exhibit A-2 Form of FAA Assignment (Used on the Closing Date - Loans)
Exhibit A-3 Form of FAA Assignment (To Be Used on Settlement Dates after the Effective Date -
Loans)
Exhibit A-4 Form of FAA Assignment (Used on Closing Date - Leases)
Exhibit A-5 Form of FAA Assignment (To Be Used on Settlement Dates after the Effective Date -
Leases)
Exhibit B-1 Form of Amended and Restated Guarantee
Exhibit B-2 Form of Guarantee Reaffirmation
Exhibit C Form of Settlement Statement
Exhibit D Form of Transfer Supplement
Exhibit E-1 Form of Legal Opinion of General Counsel to RAC
Exhibit E-2 Form of Legal Opinion of General Counsel to the Seller and Raytheon Credit
Exhibit E-3 Form of Legal Opinion of General Counsel of Raytheon
Exhibit E-4 Form of Legal Opinion of Special Counsel to the Seller and Raytheon Credit
Exhibit E-5 Form of Legal Opinion of Bingham Dana LLP, Special Counsel to
Raytheon Credit
Exhibit F-1 Form of Bailment Agreement
Exhibit F-2 Form of Bailment Agreement
Exhibit G Form of Second Amended and Restated Repurchase Agreement
Exhibit H Form of Special Settlement Date Notice
Exhibit I Form of Purchase Report
Exhibit J Form of Amendment to Intercompany Purchase Agreement
Exhibit K Form of Agreed Upon Procedures Relating to Settlement Statements and Receivables Files
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FOURTH AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT, dated
as of March 8, 2002, among RAYTHEON AIRCRAFT RECEIVABLES CORPORATION, a Kansas
corporation (the "Seller"), RAYTHEON AIRCRAFT CREDIT CORPORATION ("Raytheon
------ --------
Credit"), as Servicer (as defined herein), the financial institutions and
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special purpose corporations from time to time parties to this Agreement (the
"Purchasers"), BANK OF AMERICA, N.A., as Managing Facility Agent for the
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Purchasers (in such capacity, the "Managing Facility Agent"), JPMORGAN CHASE
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BANK and BANK OF AMERICA, N.A., as Co-Administrative Agents for the Purchasers
(in such capacity, a "Co-Administrative Agent"), J.P. MORGAN SECURITIES INC. and
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BANC OF AMERICA SECURITIES LLC, as Co-Arrangers and Joint Bookrunners, J.P.
MORGAN SECURITIES INC., as Syndication Agent (in such capacity, the "Syndication
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Agent"), CITIBANK, N.A., CREDIT SUISSE FIRST BOSTON and FLEET SECURITIES, INC.,
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as Co-Documentation Agents (in such capacity, a "Co-Documentation Agent"), and
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each Administrative Agent referred to herein.
W I T N E S S E T H :
WHEREAS, the Seller, Raytheon Credit and certain of the
Purchasers herein are parties to the Third Amended and Restated Purchase and
Sale Agreement, dated as of March 9, 2001 (as heretofore amended, supplemented
or otherwise modified, the "2001 Agreement") pursuant to which such Purchasers
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have agreed to purchase, and have purchased, certain Receivables from the
Seller;
WHEREAS, the parties hereto desire to amend the 2001 Agreement
to, among other things, permit certain resales of receivables as described
herein, modify the Commitment Fee, the Applicable Margin, the Aggregate
Repurchase Obligation and certain of the Concentration Limits provided in the
2001 Agreement and extend the Expiration Date;
WHEREAS, certain of the Purchasers under the 2001 Agreement
(the "Withdrawing Purchasers") desire to sell their undivided interests in the
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Receivables purchased thereunder and to terminate their respective Commitments
under the 2001 Agreement on the Amendment Effective Date;
WHEREAS, the Purchasers under the 2001 Agreement other than
the Withdrawing Purchasers (the "Extending Purchasers") desire to extend the
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Expiration Date;
WHEREAS, certain new financial institutions and special
purpose corporations (such other financial institutions and corporations, the
"New Purchasers") desire to become "Purchasers" under the 2001 Agreement as
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amended and restated hereby;
WHEREAS, each of the Extending Purchasers and the New
Purchasers desires to extend, increase or decrease its Commitment such that, on
the Amendment Effective Date, the Commitment of each such Purchaser will be as
shown on Annex A hereto opposite the name of such Purchaser; and
WHEREAS, the parties hereto desire to restate the 2001
Agreement as so amended, modified and supplemented, in its entirety;
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2
NOW THEREFORE, in consideration of the premises and mutual
covenants herein contained, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following
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terms shall have the following meanings:
"Acceptable L/C Issuer": a financial institution whose senior
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long-term unsecured debt is rated at least A and A2 by S&P and Moody's,
respectively, if rated by both such agencies, or at least A or A2 by
S&P or Moody's respectively, if rated by only one such agency, or if
such senior, long-term, unsecured debt is not rated, is issued by a
bank whose long-term deposits are rated at least A+ and A1 by S&P and
Moody's, respectively, if rated by both such agencies, or A+ or A1 by
S&P or Moody's, respectively, if rated by only one such agency.
"Accrual Period": (i) with respect to any Settlement Date, the
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period from and including the preceding Settlement Date (or, with
respect to the initial Accrual Period, from the Closing Date) to but
excluding such Settlement Date and (ii) a Special Settlement Date
Accrual Period.
"Administrative Agent": the collective reference to the
--------------------
Managing Facility Agent and the Old Administrative Agent, each in its
role as administrative agent hereunder.
"Affiliate": as to any Person, (a) any other Person which,
---------
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person or (b) any other Person who is a
director, officer, partner or shareholder of such Person who, in the
case of partners and shareholders, owns, directly or indirectly, 10% or
more of the voting securities (i) of such Person, (ii) of any
Subsidiary of such Person or (iii) of any Person described in the
preceding clause (a). For purposes of this definition, "control" of a
Person means the power, directly or indirectly, either to (i) vote 10%
or more of the securities having ordinary voting power for the election
of directors of such Person or (ii) direct or cause the direction of
the management and policies of such Person, whether by contract or
otherwise.
"Affiliate Obligor": each Affiliate of Raytheon Credit
-----------------
obligated to make payments in respect of a Receivable; provided that,
such Affiliate is a special purpose entity created solely for the
purpose of entering into Applicable Leases and does not and is not
expected to own any assets or incur any liabilities except in
connection with the performance of its obligations under the Contracts
pursuant to which it acquires Aircraft and the Applicable Leases of
such Aircraft.
"Affiliate Receivable": a Receivable created pursuant to a
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Contract (as described in clause (i) of the definition thereof) between
Raytheon Credit and an Affiliate Obligor located (within the meaning of
Section 9-307 of the New York UCC) within the United States which
Receivable (i) is created in connection with the acquisition by such
Affiliate Obligor of an Aircraft which is leased by such Affiliate
Obligor, as lessor, to an
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3
Unaffiliated Foreign Lessee pursuant to an Applicable Lease and (ii) is
secured by a Lien upon (x) such Aircraft and (y) such Unaffiliated
Foreign Lessee's obligations under such Applicable Lease. In accordance
with subsection 2.27, Affiliate Receivables may be categorized as
Certified Foreign Receivables or Uncertified Foreign Receivables.
"Aggregate Exposure":
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(a) at any time during the Revolving Period, an
aggregate amount equal to the Commitments in effect at such
time and each Dissenting Purchaser's Outstanding Purchase
Price at such time; and
(b) at any time during the Amortization Period, an
aggregate amount equal to the Outstanding Purchase Price of
each Purchaser (including each Dissenting Purchaser) at such
time.
"Aggregate Repurchase Obligation": at any time, the sum of the
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RARC Repurchase Obligation and the RAC Repurchase Obligation.
"Agreement": this Fourth Amended and Restated Purchase and Sale
---------
Agreement, as amended, supplemented or otherwise modified from time to
time.
"Aircraft": the collective reference to Commuter Aircraft and
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General Aviation Aircraft. When used in connection with a Travel Air
Receivable, "Aircraft" shall mean the related Obligor's undivided
interest in the applicable Aircraft.
"Aircraft Accessories": any of the items listed in clause (ii)
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of the definition of Commuter Aircraft and General Aviation Aircraft,
as applicable.
"Amendment Effective Date": as defined in Section 5.1.
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"Amortization Adjustment": the adjustment set forth below for
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the number of days since (i) for each Purchaser that is not a
Dissenting Purchaser, the commencement of the Amortization Period or
(ii) for each Dissenting Purchaser, the commencement of amortization of
such Dissenting Purchaser's Outstanding Purchase Price pursuant to
Section 2.8(b):
Days Adjustment
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1 through 180 0.25% per annum
181 through 360 0.50% per annum
Thereafter 1.00% per annum
"Amortization Event": any of the events described in
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subsection 8.1, whether or not any of the actions referred to in
subsection 8.2 have been taken.
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"Amortization Period": the period beginning on the first day
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after the termination of the Revolving Period and ending on the earlier
of (i) the day the Outstanding Purchase Price is reduced to zero as a
result of the application of Collections and other payments and (ii)
the day on which the Principal Balance of all Purchased Receivables has
been reduced to zero as a result of Collections and Net Recoveries.
"Applicable Lease": with respect to any Affiliate Receivable,
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a lease contract (substantially in the form described in clause (ii) of
the definition of Contract and which lease contract contains an option
to purchase the related Financed Aircraft by the Unaffiliated Foreign
Lessee prior to the expiration of such lease contract) between the
Affiliate Obligor and the Unaffiliated Foreign Lessee, a Lien upon
which secures the repayment of such Affiliate Receivable.
"Applicable Margin": (a) for each Purchaser for any
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Settlement Period, the rate per annum set forth below for Raytheon's
applicable Debt Rating:
Debt Rating Applicable Margin
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BBB+ or the equivalent thereof or above 0.875%
BBB or the equivalent thereof 1.000%
BBB- or the equivalent thereof 1.250%
BB+ or the equivalent thereof 1.625%
below BB+ or the equivalent thereof 2.125%
(b) For purposes of this definition, changes to the Debt
Rating will be effective for all Settlement Periods commencing on the
Settlement Date next succeeding any such change.
"Applicable Settlement Date": as defined in the definition of
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"Ineligible Receivable."
"Assignment": an assignment, substantially in the form of
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Exhibit A-1 with appropriate insertions and attachments, executed by
the Seller or an Affiliate Obligor, as the case may be, and delivered
to the Managing Facility Agent or the Seller, as the case may be, with
respect to each purchase or substitution.
"Available Commitment": as to any Purchaser at any time, an
--------------------
amount equal to the excess, if any, of (a) the amount of such
Purchaser's Commitment over (b) the product of such Purchaser's
Available Commitment Percentage multiplied by the aggregate Outstanding
Purchase Price (excluding any Dissenting Purchaser's Outstanding
Purchase Price at such time).
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5
"Available Commitment Percentage": as to any Purchaser at any
-------------------------------
time, a fraction the numerator of which is the Commitment of such
Purchaser at such time and the denominator of which is the aggregate
Commitments at such time.
"Aviation Act": the Federal Aviation Act of 1958, as amended,
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and all applicable rules and regulations thereunder.
"Bailee": any Person (other than the Administrative Agent and
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the Seller) which enters a Bailment Agreement.
"Bailment Agreement": each agreement, substantially in the
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form of Exhibit F-1 or F-2 with such changes thereto as are reasonably
satisfactory in form and substance to the Managing Facility Agent,
among an Administrative Agent, the Seller and the Person therein
designated, which Person shall be acceptable to the Managing Facility
Agent in its reasonable discretion, to maintain custody, as the bailee
of the Administrative Agent and the Purchasers, of the letter of credit
related to each L/C Receivable sold or substituted hereunder on the
terms and subject to the conditions set forth therein, as any of the
same may be amended, supplemented or otherwise modified from time to
time.
"Base Rate": for any day, the higher of (a) 0.50% per annum
---------
above the latest Federal Funds Rate and (b) the rate of interest in
effect for such day as publicly announced from time to time by Bank of
America, N.A. in Charlotte, North Carolina, as its "reference rate".
The "reference rate" is a rate set by Bank of America, N.A. based upon
various factors including Bank of America, N.A.'s costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above,
or below such announced rate. Any change in the reference rate
announced by Bank of America, N.A. shall take effect at the opening of
business on the day specified in the public announcement of such
change.
"Benefitted Purchaser": as defined in subsection 11.7(a).
--------------------
"Business Day": a day other than a Saturday, Sunday or other
------------
day on which commercial banks in New York, New York, Wichita, Kansas,
Boston, Massachusetts, or San Francisco, California are authorized or
required by law to close.
"Buyout Amount": as defined in subsection 2.8(b)(iii).
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"Cash Collateral Account": as defined in subsection 2.14(c)
-----------------------
(i).
"Cash Equivalents": (a) securities issued or directly and
----------------
fully guaranteed or insured by the United States Government or any
agency or instrumentality thereof having maturities not later than the
Settlement Date following the date of acquisition, (b) certificates of
deposit and eurodollar time deposits with maturities not later than the
Settlement Date following the date of acquisition, bankers' acceptances
with maturities not later than the Settlement Date following the date
on which such investment is made and overnight bank deposits, in each
case, with any commercial bank (i) the short-term indebtedness of which
is rated at least A-1 or P-1 by S&P or Moody's, respectively, and
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6
(ii) with capital and surplus in excess of $500,000,000, (c)
repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (a) and (b)
entered into with any financial institution meeting the
qualifications specified in clause (b) above, and (d) commercial
paper rated at least A-1 or P-1 by S&P or Moody's, respectively, and
in each case with maturities not later than the Settlement Date
following the date of acquisition.
"Cash Flow Cutoff Date": as of any Settlement Date and with
---------------------
respect to any Extended Term Receivable, (i) so long as no Rating Event
has occurred and is continuing, the date which is thirteen years after
such Settlement Date and (ii) during the continuation of a Rating
Event, the date which is ten years after such Settlement Date.
"Certified Foreign Receivable": each Affiliate Receivable and
----------------------------
each Foreign Receivable (i) in the case of a Foreign Receivable which
is not a Lease Receivable, (x) in respect of which the obligations of
the related Obligor are secured by a Lien on the related Contract and
Financed Aircraft in compliance with subsections 5.2(e)(ii) and (vii),
(y) which has been so designated as a Certified Foreign Receivable in
compliance with subsection 2.27 and (z) in respect of which the Seller
has satisfied the conditions specified in subsection 5.2 (including
subsection 5.2(e)), (ii) in the case of a Foreign Receivable which is a
Lease Receivable (including a Registerable Lease Receivable with a
Foreign Obligor) (x) in respect of which the obligations of the related
Obligor are secured by a Lien on the related Contract and Financed
Aircraft in compliance with subsections 5.2(e)(iii), (iv) and (vii),
(y) which has been so designated as a Certified Foreign Receivable in
compliance with subsection 2.27 and (z) in respect of which the Seller
has satisfied the conditions specified in subsection 5.2 (including
subsection 5.2(e)) and (iii) in the case of an Affiliate Receivable (x)
in respect of which the obligations of the related Obligor are secured
by a Lien on the related Contract and Financed Aircraft in compliance
with subsections 5.2(e)(vi) and (vii), (y) which has been so designated
as a Certified Foreign Receivable in compliance with subsection 2.27
and (z) in respect of which the Seller has satisfied the conditions
specified in subsection 5.2 (including subsection 5.2(e)).
"Certified Opinion Delivery Date": as defined in subsection
-------------------------------
2.27(c).
"Closing Date": March 24, 1997.
------------
"Code": the Internal Revenue Code of 1986, as amended from
----
time to time.
"Collateral": as defined in subsection 11.11(b).
----------
"Collection Account": as defined in subsection 2.14(a).
------------------
"Collections": with respect to any Purchased Receivable, all
-----------
cash collections (including, without limitation, Principal Collections,
Finance Charge Collections and other payments (including penalties, if
any)), rent paid under any Contract (whether as Principal Collections
or Finance Charge Collections), all security deposits (including,
without limitation, any engine reserve account), any payments pursuant
to guarantees and
<PAGE>
7
all amounts paid by any Obligor or Unaffiliated Foreign Lessee upon the
exercise of any purchase option under any Contract (including any
amounts financed by the Seller), the amount of drawings under a
letter of credit related to such Purchased Receivable, any insurance
paid in respect of an Exim Bank Receivable, any curtailment payments
made by an Obligor in respect of a Wholesale Receivable, and any
other cash proceeds of any Purchased Receivable or proceeds of such
Purchased Receivable, including, without limitation, any proceeds
from realization upon collateral (including, without limitation, any
Financed Aircraft, Applicable Lease, insurance proceeds, letters of
credit, security deposits, curtailment payments, indemnity payments
or any other cash payments under or with respect to the related
Contract) and any amounts withdrawn from the Cash Collateral Account
pursuant to subsection 2.14(c).
"Commitment": as to any Purchaser, the obligation of such
----------
Purchaser to purchase undivided interests in Eligible Receivables from
the Seller in an amount at any one time outstanding not to exceed the
amount set forth opposite such Purchaser's name on Schedule I, as
reduced from time to time in accordance with the terms hereof; as to
all the Purchasers on the Amendment Effective Date, not to exceed an
aggregate amount of $1,400,000,000.
"Commitment Fee": as defined in subsection 2.17(d).
--------------
"Commitment Percentage":
---------------------
(a) at any time during the Revolving Period and as to
any Purchaser other than a Dissenting Purchaser, a fraction,
the numerator of which is the Commitment of such Purchaser
in effect at such time and the denominator of which is equal
to the Aggregate Exposure at such time;
(b) at any time during the Revolving Period and as to a
Dissenting Purchaser, a fraction, the numerator of which is
the Outstanding Purchase Price of such Dissenting Purchaser
at such time and the denominator of which is equal to the
Aggregate Exposure at such time; and
(c) at any time during the Amortization Period and as to
any Purchaser, including a Dissenting Purchaser, a fraction
the numerator of which is equal to the Outstanding Purchase
Price of such Purchaser at such time and the denominator of
which is equal to the Aggregate Exposure at such time.
"Commitment Transfer Supplement": a Commitment Transfer
------------------------------
Supplement, substantially in the form of Exhibit D.
"Commonly Controlled Entity": with respect to a Person, an
--------------------------
entity, whether or not incorporated, which is under common control with
such Person within the meaning of Section 4001 of ERISA or is part of a
group which includes such Person and which is treated as a single
employer under Section 414 of the Code.
<PAGE>
8
"Commuter Aircraft": the Models 1300, 1900 and 99 Beechcraft
-----------------
manufactured by RAC and comparable general aviation aircraft used for
commuter airline purposes manufactured by any other Person including,
in all cases, without limitation, (i) any and all airframes, engines,
(including, without limitation, any replacement or substituted engines)
and avionics, equipment and accessories at any time attached to,
connected with or located in any such aircraft and, to the extent
covered by the recording system of the Aviation Act, all logs, manuals
and maintenance records with respect thereto and (ii) any and all
avionics, equipment and accessories removed from any Aircraft and, to
the extent not covered by the recording system of the Aviation Act, all
logs, manuals and maintenance records.
"Commuter Receivable": a Receivable the Obligor of which owns
-------------------
and operates a commuter airline.
"Concentration Account": as defined in subsection 2.14(b).
---------------------
"Concentration Receivables": as defined in subsection 2.7(b).
-------------------------
"Consolidated Capitalization": at a particular date, the sum
---------------------------
of Consolidated Debt, Mandatorily Redeemable Equity Securities and
Consolidated Net Worth at such date.
"Consolidated Debt": at a particular date, all amounts which
-----------------
would be included as indebtedness (including capitalized leases) on a
consolidated balance sheet of Raytheon and its consolidated
Subsidiaries, determined in accordance with GAAP.
"Consolidated EBITDA": for any period, the sum of (a)
-------------------
Consolidated Net Income for such period and (b) the aggregate amounts
deducted in determining Consolidated Net Income in respect of (i)
Consolidated Net Interest Expense for such period, (ii) income taxes,
depreciation and amortization of Raytheon and its consolidated
Subsidiaries for such period determined in accordance with GAAP and
(iii) write-offs of goodwill as required, or as would be required in
the next succeeding fiscal year of Raytheon, by Statement of Financial
Accounting Standards No. 142, Goodwill and Other Intangible Assets.
"Consolidated Net Income": for any period, the consolidated
-----------------------
net income (or deficit) of Raytheon and its consolidated Subsidiaries
for such period, determined in accordance with GAAP; provided that (i)
--------
for the fiscal quarter of Raytheon and its consolidated Subsidiaries
ending April 1, 2001, such Consolidated Net Income shall be increased
by $325,000,000 representing one-time charges recorded in connection
with the discontinued operations of Raytheon Engineers and
Constructors, (ii) for the fiscal quarter of Raytheon and its
consolidated Subsidiaries ending July 1, 2001, such Consolidated Net
Income shall be increased by an aggregate amount not to exceed
$272,000,000 for such fiscal quarter, representing additional one-time
charges to the extent recorded in connection with the discontinued
operations of Raytheon Engineers and Constructors during such fiscal
quarter and (iii) for the fiscal quarter of Raytheon and its
consolidated Subsidiaries ending September 30, 2001, such Consolidated
Net Income shall be increased by an aggregate amount not to exceed
$750,000,000 representing one-
<PAGE>
9
time charges recorded in connection with the inventory write-down and
valuation reserve related to various aircraft.
"Consolidated Net Interest Expense": for any period, net
---------------------------------
interest expense of Raytheon and its consolidated Subsidiaries for
such period, determined in accordance with GAAP.
"Consolidated Net Worth": at a particular date, all amounts
----------------------
which would, in conformity with GAAP, be included under stockholders'
equity on a consolidated balance sheet of Raytheon and its
consolidated Subsidiaries at such date.
"Contract": with respect to a Receivable, the collective
--------
reference to (a) the promissory notes, security agreements, leases,
financing and security agreements, contracts, documents and instruments
between the Seller and the Obligor thereon on the Seller's standard
form therefor (as in effect on the Closing Date) or such other forms as
shall contain substantially similar provisions to such standard forms,
pursuant to which the Seller has (i) lent the Obligor funds to purchase
an Aircraft or, in the case of the Travel Air Receivables, an undivided
interest therein, and the Obligor has agreed to make installment
payments in respect of such purchase, or (ii) leased an aircraft or, in
the case of the Travel Air Receivables, an undivided interest therein;
to the Obligor, in each case, as amended, supplemented or otherwise
modified from time to time and (b) upon the occurrence of an event of
the type described in subsection 8.1(j) affecting the Seller, each and
every promissory note, security agreement, lease, financing and
security agreement, contract, document and instrument executed in
replacement or supersession of another Contract described in clause (a)
with the same Obligor, or executed upon extension, modification or
amendment of such Contract, whether in connection with an agreement
pursuant to Section 1110 of the Bankruptcy Code (11 USC [sec] 1110) or
otherwise. Whenever used in connection with any Purchased Receivables,
unless the context otherwise requires "Contract" shall include any
Applicable Lease securing the obligations of the Affiliate Obligor
under such Purchased Receivable.
"Contractual Obligation": as to any Person, any provision of
----------------------
any security issued by such Person or of any agreement, instrument or
other undertaking to which such Person is a party or by which it or
any of its property is bound.
"Credit and Collection Policy": those credit and collection
----------------------------
policies and practices of the Seller and the Servicer existing on the
Closing Date relating to the Receivables (including, without
limitation, policies relating to writeoffs of Receivables and policies
and practices maintained by the Seller's or the Servicer's computer
system and policies set forth in the form previously delivered to the
Purchasers, as modified from time to time in accordance with subsection
7.1(c).
"Dealer": any independent dealer or Affiliate of Raytheon
------
Credit which markets and sells Aircraft.
"Debt Rating": at any date of determination, Raytheon's
-----------
long-term unsecured senior debt rating, determined in accordance with
the following:
<PAGE>
10
(a) for purposes of determining a Debt Rating as used in
the definition of "Applicable Margin" and as used in
calculating the Commitment Fee pursuant to Section 2.17(d), if
on any date on which a Debt Rating is to be determined,
Moody's and S&P are providing long-term unsecured senior debt
ratings for Raytheon, the Debt Rating will be the lower of
such ratings; provided that (i) if Raytheon's long-term
--------
unsecured senior debt is rated at least BBB- or the equivalent
thereof by both Moody's and S&P and (ii) the differential
between the Moody's and S&P rating is more than one ratings
level (i.e. the difference between A and A+ being one ratings
level), then the Debt Rating will equal the lower of such
ratings plus one ratings level; and
(b) for all other purposes, if on any date on which a
Debt Rating is to be determined, either one or both of Moody's
and S&P are providing long-term unsecured senior debt ratings
for Raytheon, the Debt Rating will be the higher of the
ratings (or the rating, in the case of a rating by only one of
Moody's and S&P) so provided.
A debt rating shall be deemed to be in effect on the date of
announcement or publication by the applicable rating agency. References
in this Agreement to alphabetical rating classifications are references
to the S&P ratings. Notwithstanding the foregoing, the Seller and the
Purchasers may at any time and from time to time agree to utilize a
rating agency other than Moody's or S&P to determine the Debt Rating,
in which case the Debt Rating shall be such levels as quoted by such
rating agencies as, in each case, the Seller and the Purchasers, by
unanimous consent, shall agree.
"Debt Ratio": at a particular date, the ratio of Consolidated
----------
Debt at such date to Consolidated Capitalization at such date.
"Default Rate": as defined in subsection 2.17(c).
------------
"Defaulted Applicable Lease": an Applicable Lease (i) as to
--------------------------
which any payment thereon or part thereof remains unpaid by the
Unaffiliated Foreign Lessee thereon for (x) 120 days in the case of a
GA Receivable or (y) 150 days in the case of a Commuter Receivable,
from, in each case, the original due date for such payment by such
Unaffiliated Foreign Lessee, (ii) as to which the Unaffiliated Foreign
Lessee thereof has taken or suffered any action of the type described
in subsection 8.1(j) with respect to such Person or (iii) which,
consistent with the Credit and Collection Policy, would be written off
the Seller's books as uncollectible.
"Defaulted Receivable": a Receivable, (i) in the case of a GA
--------------------
Receivable or a Travel Air Receivable, as to which any payment on such
Receivable or part thereof remains unpaid by the Obligor thereon for
120 days from the original due date for such payment by such Obligor,
(ii) in the case of a Commuter Receivable, as to which any payment on
such Receivable or part thereof remains unpaid by the Obligor thereon
for 150 days from the original due date for such payment by such
Obligor, (iii) in the case of a Wholesale Receivable, as to which any
payment on such Receivable or part thereof remains unpaid by the
Obligor thereon for 60 days from the original due date for such
<PAGE>
11
payment by such Obligor, (iv) in the case of an Affiliate Receivable,
as to which the Applicable Lease related thereto is a Defaulted
Applicable Lease or (v) any Receivable as to which the Obligor thereof
has taken or suffered any action of the type described in subsection
8.1(j) with respect to such Obligor or which, consistent with the
Credit and Collection Policy, would be written off the Seller's books
as uncollectible.
"Delinquent Receivable": an Eligible Receivable a payment
---------------------
under which is more than 90 days past due from the original due date
therefor, but which is not otherwise a Defaulted Receivable.
"Discount Amount": as of the date of the first occurrence of a
---------------
Discount Event (which is not also a Rating Event), the product of the
Outstanding Purchase Price (as of the Settlement Date preceding such
date of occurrence, or, if such date of occurrence is a Settlement
Date, then such Settlement Date) multiplied by the Purchase Discount
applicable on such date of occurrence.
"Discount Event": any time on or prior to the Expiration Date
--------------
when Raytheon's Debt Rating is lower than BBB- or the equivalent
thereof.
"Dissenting Purchaser": as defined in subsection 2.8(b).
--------------------
"Domestic Wholesale Receivable": a Receivable arising under a
-----------------------------
wholesale financing arrangement between Raytheon Credit and, as Obligor
thereunder, a Dealer which is located (within the meaning of Section
9-307 of the New York UCC) in the United States.
"Effective Date": as defined in Section 5.1 of the 1997
--------------
Agreement.
"Eligible Applicable Lease": (x) with respect to each
-------------------------
Affiliate Receivable other than an Existing Affiliate Receivable, at
the time of purchase or substitution of such Affiliate Receivable
pursuant to this Agreement, an Applicable Lease related thereto:
(a) the Unaffiliated Foreign Lessee of which (i) is not
an Affiliate of Raytheon Credit or the Servicer, (ii) is not
located in a Prohibited Jurisdiction, (iii) is not, except to
the extent permitted under subsection 2.7, a Governmental
Authority unless the Affiliate Obligor, Raytheon Credit and
the Seller have complied with the requirements of each
applicable Requirement of Law pertaining to the assignment of
accounts receivable the obligor of which is a Governmental
Authority, all in a manner satisfactory to the Managing
Facility Agent and the Required Purchasers in their reasonable
discretion and (iv) is not the Unaffiliated Foreign Lessee or
the Obligor, or an Affiliate of an Obligor or Unaffiliated
Foreign Lessee, on any Receivable or Applicable Lease which is
a Defaulted Receivable or Defaulted Applicable Lease, as
appropriate;
(b) which is neither more than 30 days past due from the
original due date therefor nor otherwise a Defaulted
Applicable Lease;
<PAGE>
12
(c) which arose in the ordinary course of Raytheon
Credit's business from financing the retail purchase or lease
financing of an Aircraft and relates to an Aircraft which will
be used for general aviation purposes or with respect to the
ownership and operation of a commuter airline, but not for
military purposes;
(d) which is subject only to adjustment for changes in
payments in accordance with the terms thereof resulting from
changes in the interest rates thereunder and the payment terms
of which are identical to the payment terms set forth in the
related Affiliate Receivable;
(e) which is an "account" or a "general intangible" or
which constitutes "chattel paper" within the meaning of the
UCC of the State of Kansas or the law of the state where the
Seller or the Servicer maintains the books, records and
documents with respect to such Receivable;
(f) which is denominated and payable only in United
States dollars in the United States;
(g) which (i) has been duly authorized by each party
thereto (or, if any such party is an individual, such party
has the capacity to enter into) and each of the parties
thereto is in compliance therewith in all material respects,
(ii) was not originated with any conduct constituting fraud or
a material misrepresentation on the part of the Affiliate
Obligor, Raytheon Credit or the Seller, (iii) was not
originated with any conduct constituting fraud or a material
misrepresentation by the Unaffiliated Foreign Lessee party
thereto of which Raytheon Credit, the Seller or the Affiliate
Obligor thereto knew or should have known based on the
exercise of reasonable care, (iv) constitutes the legal, valid
and binding obligation of the Unaffiliated Foreign Lessee
thereof enforceable against such Unaffiliated Foreign Lessee
in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable
principles (whether enforcement is sought by proceedings in
equity or at law), (v) contains enforceable provisions such
that the rights and remedies of the holder of the security
interest created therein are adequate for the realization of
the benefits of such security interest against the related
Unaffiliated Foreign Lessee and the other collateral therefor
and (vi) if the engine for the related Financed Aircraft has
750 or more rated takeoff horsepower (or the equivalent of
such horsepower), accurately describes the engines of such
Financed Aircraft as provided for in such Applicable Lease;
(h) which is not subject to any existing material
dispute, offset, counterclaim or defense whatsoever
(including, but not limited to, breach of warranty) of which
Raytheon Credit, the Seller or the Servicer knows or should
have known;
(i) which does not, or at the time of lease of the
Financed Aircraft did not, contravene any Requirements of Law
applicable thereto in any material respect
<PAGE>
13
(including, without limitation, laws, rules and regulations
relating to truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection
practices and privacy) and with respect to which no party
thereto is in violation of any such Requirement of Law in any
material respect;
(j) which was originated in accordance with the Credit
and Collection Policy and satisfied all requirements thereof;
(k) on which either at least one payment or a down
payment (including a trade-in) has been made prior to the
Closing Date or the Settlement Date on which the related
Affiliate Receivable is purchased or substituted;
(l) the payment terms of which have not been modified
other than (i) in accordance with the Credit and Collection
Policy and (ii) to an extent and in an amount not in excess of
the limitations specified in subsection 7.1(b)(iv)(x); and
(m) of which the Affiliate Obligor, at the time of
transfer of the related Affiliate Receivable to the
Purchasers, has good and marketable title, free and clear of
any Lien other than any Permitted Receivable Lien; and
(y) with respect to any Existing Affiliate Receivable, at the date of
its purchase or substitution under the Existing Agreement pursuant to
which such Receivable was sold to the Old Administrative Agent, the
Applicable Lease related thereto was an "Eligible Applicable Lease" (as
defined in such applicable Existing Agreement) at such date.
"Eligible Receivable": (x) with respect to each Receivable
-------------------
other than an Existing Receivable, at the time of purchase or
substitution pursuant to this Agreement, a Receivable:
(a) except with respect to an Affiliate Receivable, the
Obligor of which is not an Affiliate of Raytheon Credit, the
Seller or the Servicer;
(b) except with respect to a Foreign Receivable, the
Obligor of which is located (within the meaning of Section
9-307 of the New York UCC) within the United States and is a
Citizen of the United States (as defined in the Aviation Act);
and, with respect to a Foreign Receivable, the Obligor of
which is not located in a Prohibited Jurisdiction;
(c) except with respect to an ExIm Bank Receivable and
except as otherwise permitted in subsection 2.7(a)(xii), the
Obligor of which is not a Governmental Authority unless each
of Raytheon Credit and the Seller has complied with the
requirements of the Federal Assignment of Claims Act or any
other applicable Requirement of Law pertaining to the
assignment of accounts receivable the Obligor of which is a
Governmental Authority, all in a manner satisfactory to the
Managing Facility Agent and the Required Purchasers in their
reasonable discretion; provided that if a Rating Event has
--------
occurred and is continuing, any Affiliate Receivable in
respect of which the Unaffiliated Foreign
<PAGE>
14
Lessee under the related Applicable Lease is any Governmental
Authority other than a United States Federal Governmental
Authority shall not be eligible for purchase or substitution
under this Agreement regardless of any action taken by
Raytheon Credit or the Seller with respect to the assignment
of such Applicable Lease;
(d) the Obligor of which is not the Obligor or an
Affiliate of an Obligor on any other Receivable which is a
Defaulted Receivable;
(e) which is neither more than 30 days past due from the
original due date therefor nor otherwise a Defaulted
Receivable;
(f) which arose in the ordinary course of Raytheon
Credit's business from financing the retail purchase or lease
or, in the case of a Wholesale Receivable, the wholesale
purchase of an Aircraft and relates to an Aircraft which will
be used for general aviation purposes or in connection with
commuter airline operations, but not for military purposes,
and which was purchased by the Seller from Raytheon Credit
pursuant to the Intercompany Purchase Agreement in the
ordinary course of the Seller's business;
(g) with respect to GA Receivables, subject only to
adjustment for changes in payments in accordance with the
related Contract resulting from changes in the interest rates
thereunder, (i) which, except as set forth in clause (ii)
below, is required to be paid in consecutive monthly
installments or is a Quarterly Receivable or a Semi-Annual
Receivable or (ii) which (A) is a Nonstandard Receivable or
(B) has a maturity within six months from the date such
Receivable becomes a Purchased Receivable, provided that no
such Receivable will have a maturity later than six months
after the invoice date for such Receivable;
(h) which is an "account" or a "general intangible" or
which constitutes "chattel paper" within the meaning of the
UCC of the State of Kansas or the law of the state where the
Seller or the Servicer maintains the books, records and
documents with respect to such Receivable;
(i) which is denominated and payable only in United
States dollars in the United States;
(j) which arises under a Contract which (i) has been duly
authorized by each party thereto (or, if any such party is an
individual, such party has the capacity to enter into) and
each party thereto is in compliance therewith in all material
respects, (ii) was not originated with any conduct
constituting fraud or a material misrepresentation on the part
of the Seller or Dealer (if different from the Obligor
thereto), (iii) was not originated with any conduct
constituting fraud or a material misrepresentation by an
Obligor party thereto of which the Seller or Dealer (if
different from the Obligor) knew or should have known based on
the exercise of reasonable care, (iv) constitutes the legal,
valid and binding obligation of the Obligor thereof
enforceable against such Obligor in accordance with its
<PAGE>
15
terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally
and by general equitable principles (whether enforcement is
sought by proceedings in equity or at law), (v) except with
respect to each L/C Receivable, contains enforceable
provisions such that the rights and remedies of the holder of
the security interest created thereby are adequate for the
realization of the benefits of such security interest against
the related Financed Aircraft and the other collateral
therefor and (vi) accurately describes the engines, if any, of
the related Financed Aircraft having 750 or more rated takeoff
horsepower (or the equivalent of such horsepower) as provided
for in such Contract;
(k) (i) except with respect to a L/C Receivable, a Lease
Receivable, a Travel Air Receivable and an Unsecured
Receivable, which is secured by a valid and perfected first
priority security interest in favor of the Seller in the
Financed Aircraft related thereto (other than, in the case of
GA Receivables, any engines having less than 750 or more rated
takeoff horsepower, or its equivalent) and, with respect to an
Affiliate Receivable, in the related Applicable Lease, (ii)
with respect to a Registerable Lease Receivable and with
respect to an ExIm Bank Receivable, the related Financed
Aircraft of which is registered with the FAA Registry in the
name of the Seller and relates to a Financed Aircraft in which
the Seller has a valid ownership interest, (iii) with respect
to a Lease Receivable which is not a Registerable Lease
Receivable, the related Financed Aircraft of which is
registered in the name of the Seller in each jurisdiction
necessary to evidence the valid ownership interest of the
Seller in the Financed Aircraft related thereto and (iv) with
respect to a Travel Air Receivable, which is secured by a
valid and perfected first priority security interest in favor
of the Seller in the Obligor's undivided interest in the
Financed Aircraft and Travel Air Contracts related thereto;
(l) except with respect to a L/C Receivable and an
Unsecured Receivable, the security or ownership interest, as
the case may be, of Raytheon Credit in the Financed Aircraft
related thereto is assignable by Raytheon Credit and, except
as permitted under subsection 2.7(a)(x), has been so assigned
as a first priority security interest to the Seller and by the
Seller to the Administrative Agent for the ratable benefit of
the Purchasers to secure the obligations under the related
Receivable and which Financed Aircraft is subject to no other
Liens other than Permitted Aircraft Liens; including (i)
except with respect to a Foreign Receivable (other than a
Registerable Lease Receivable with a Foreign Obligor), of
which the security interest granted by the Obligor in favor of
Raytheon Credit and assigned to the Seller and/or, in the case
of a Lease Receivable, by the Seller in favor of the
Administrative Agent (including, with respect to a
Registerable Lease Receivable, the security interest in the
Financed Aircraft in favor of the Administrative Agent)
encumbering the related Financed Aircraft (other than, for GA
Receivables, Aircraft Accessories with respect thereto and
engines of such Financed Aircraft, if any, having a rated
takeoff power of 750 horsepower or its
<PAGE>
16
equivalent) has been duly registered and recorded with the FAA
Registry, (ii) with respect to a Foreign Receivable (other
than a L/C Receivable and a Lease Receivable with a Foreign
Obligor) of which the security interest encumbering the
related Financed Aircraft has been duly filed, registered or
recorded with each office in each jurisdiction in which such
filing, registration or recordation is necessary to perfect
the security interest therein granted (x) by the Obligor
thereon in favor of Raytheon Credit, (y) by Raytheon Credit in
favor of the Seller and (z) by the Seller in favor of the
Administrative Agent for the ratable benefit of the Purchasers
and (iii) with respect to a Lease Receivable with a Foreign
Obligor (other than a Registerable Lease Receivable with a
Foreign Obligor) of which the security interest encumbering
the related Financed Aircraft has been duly filed, registered
or recorded with each office in each jurisdiction in which
such filing, registration or recordation is necessary to
perfect the security interest therein granted by the Seller in
favor of the Administrative Agent for the ratable benefit of
the Purchasers;
(m) as to which, upon the transfer of such Receivable
pursuant to this Agreement, either (i) the Purchasers have a
perfected, valid and enforceable first priority ownership
interest in such Receivable or (ii) the Administrative Agent
for the ratable benefit of the Purchasers has a valid,
perfected and first priority security interest in such
Receivable, in each case free and clear of all Liens other
than Permitted Receivable Liens;
(n) of which (i) with respect to each Receivable other
than a Lease Receivable and a Travel Air Receivable, the
related Financed Aircraft is owned by the Obligor on the
related Contract, (ii) with respect to each Lease Receivable,
except as permitted under subsection 2.7(a)(x), the related
Financed Aircraft is owned by the Seller and (iii) with
respect to each Travel Air Receivable, an undivided interest
in the related Financed Aircraft is owned by the related
Obligor;
(o) of which the related Financed Aircraft is (i) with
respect to each Financed Aircraft registered in the name of
the Seller, Raytheon Credit, Travel Air or the related Obligor
with the FAA, duly certified by the FAA as to type and
airworthiness and (ii) in all other cases, duly certified by
the appropriate governmental authorities in the applicable
foreign jurisdiction as to type and airworthiness;
(p) which is not subject to any existing material
dispute, offset, counterclaim or defense whatsoever
(including, but not limited to, breach of warranty) of which
Raytheon Credit, the Seller or the Servicer knows or should
have known;
(q) which, together with the Contract and the Financed
Aircraft related thereto, does not, or at the time of sale (or
lease, as the case may be) of the Financed Aircraft did
not, contravene any Requirements of Law applicable thereto in
any material respect (including, without limitation, laws,
rules and
<PAGE>
17
regulations relating to truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which no
party to the Contract related thereto is in violation of any
such Requirement of Law in any material respect;
(r) which was originated in accordance with the Credit
and Collection Policy and satisfied all requirements thereof
and of the related Contract;
(s) which, except for an Extended Term Receivable, has a
Final Payment Date not later than (i) so long as no Rating
Event has occurred and is continuing, thirteen years after the
Settlement Date on which such Receivable is purchased or
substituted and (ii) during the continuance of a Rating Event,
ten years after the Settlement Date on which such Receivable
is purchased or substituted;
(t) (i) for Receivables other than those Receivables
referred to in clause (g)(ii)(B) of this definition, the
related Financed Aircraft has been delivered to the Obligor
(x) so long as Raytheon's Debt Rating is no lower than BBB- or
the equivalent thereof, no later than the second Settlement
Date following the Settlement Date on which undivided
interests in such Receivable are sold to the Purchasers and
(y) in all other cases, no later than the Settlement Date on
which undivided interests in such Receivable are sold to the
Purchasers or (ii) for those Receivables referred to in clause
(g)(ii)(B) of this definition, the related Financed Aircraft
has been delivered to the Obligor no later than six months
after the invoice date for such Receivable;
(u) except with respect to a Wholesale Receivable, on
which either at least one payment or a down payment (including
a trade-in) has been made prior to the Settlement Date on
which it is purchased or substituted;
(v) the payment terms of which have not been modified
other than (i) in accordance with the Credit and Collection
Policy and (ii) to an extent and in an amount not in excess of
the limitations specified in subsection 7.1(b)(iv)(x);
(w) of which the related Financed Aircraft is insured
against loss, damage, theft, hull and such other casualties as
may be required pursuant to the related Contract, including
without limitation passenger legal liability, public legal
liability and property damages legal liability, the policy or
policies of which shall (i) provide that Raytheon Credit or
any Affiliate Obligor, as the case may be, is named thereunder
as loss payee and is entitled to receive 30 days prior notice
of cancellation thereof, (ii) contain a breach of warranty
endorsement in favor of Raytheon Credit or any Affiliate
Obligor as the case may be, (iii) provide for insurance in an
amount, after calculation of any deductible, at least equal to
the outstanding principal of the Contract at any time and (iv)
be maintained with financially sound and reputable insurance
companies;
(x) if a Lease Receivable (i) prior to the Settlement
Date on which such Lease Receivable is purchased or
substituted, with respect to which all actions
<PAGE>
18
required under the related lease to assign to the
Administrative Agent on behalf of the Purchasers the Seller's
and Raytheon Credit's respective rights thereunder (including,
without limitation, any notice to, consent of or acceptance by
the lessee party thereto) shall have been duly performed, (ii)
prior to the Settlement Date on which such Lease Receivable is
purchased or substituted, a determination shall have been made
if such Receivable is a Registerable Lease Receivable in
accordance with the definition of such term, (iii) on the
Settlement Date on which such Lease Receivable is purchased or
substituted, no Rating Event shall have occurred and be
continuing and (iv) such Lease Receivable is carried on the
books of the Seller as a "sale" under GAAP;
(y) if a L/C Receivable, with respect to which the
related letter of credit (i) either (A) is issued by an
Acceptable L/C Issuer or (B) if the issuer of the related
letter of credit is not an Acceptable L/C Issuer, at the time
of purchase or substitution no Rating Event has occurred and
is continuing, (ii) is issued or confirmed by a financial
institution located in the United States or which otherwise
provides that drawings thereunder may be made in the United
States, (iii) is an irrevocable standby letter of credit
providing for drawings upon the occurrence of a default under
the related Contract on sight or upon presentation of
certificates specified therein, (iv) at any date of
determination has an available amount equal to the then
outstanding Principal Balance of such Receivable, (v) is in
full force and effect and (vi) either (A) has an expiration
date which is at least five Business Days following the last
scheduled payment date under the related Contract or (B)
provides for automatic extensions without amendment, notice or
other act by or to any Person or permits the Seller to draw
the aggregate amount then available to be drawn thereunder if
not extended;
(z) which is not an Operating Lease Receivable;
(aa) if an ExIm Bank Receivable, (i) at least 85% of the
Principal Balance of which is insured by the related insurance
policy and such insurance policy is in full force and effect
and all premiums have been paid in full, (ii) the related
Contract of which requires the Obligor to purchase the
Aircraft at the end of the term thereof, (iii) at the time of
purchase or substitution of which no Rating Event has occurred
and is continuing and (iv) prior to the Settlement Date on
which such ExIm Bank Receivable is purchased or substituted,
all actions required to assign to the Administrative Agent on
behalf of the Purchasers the Seller's and Raytheon Credit's
respective rights to amounts payable under the related
insurance policy and the Seller's rights under any lease of
the related Aircraft by an Obligor on such ExIm Bank
Receivable (including, without limitation, any notice to,
consent of or acceptance by the insurer or lessee thereunder)
shall have been duly performed;
(bb) if a Wholesale Receivable, (i) the Principal Balance
of which (together with interest thereon) is payable in
accordance with the original terms thereof no later than 180
days after the original date of the Contract related
<PAGE>
19
thereto, and (ii) the original maturity date thereof has not
been extended more than twice;
(cc) if a Domestic Wholesale Receivable, the related
Financed Aircraft of which has not been sold more than once or
to more than one other independent Dealer (exclusive of
Dealers owned by Raytheon Credit or RAC);
(dd) if a Nonstandard Receivable, a Rating Event shall
not have occurred and be continuing;
(ee) if an Affiliate Receivable, (x) prior to the
Settlement Date on which such Affiliate Receivable is
purchased or substituted, all actions required to assign (1)
to Raytheon Credit, and from Raytheon Credit to the Seller,
the Affiliate Obligor's rights under the Applicable Lease and
Financed Aircraft and (2) to the Administrative Agent, the
Seller's rights under the Financed Aircraft and the Applicable
Lease (including, without limitation, in case of clauses (1)
and (2), any notice to, consent of or acceptance by the
Unaffiliated Foreign Lessee party thereto) shall have been
duly performed and the Administrative Agent, for the ratable
benefit of the Purchasers, shall have a valid, perfected and
first priority security interest in such Financed Aircraft and
Applicable Lease as collateral security for the Affiliate
Obligor's obligations under such Affiliate Receivable, free
and clear of all Liens other than (i) the Lien created in
favor of Raytheon Credit and the Seller, (ii) the Lien created
under this Agreement in favor of the Administrative Agent for
the ratable benefit of the Purchasers and (iii) any Permitted
Receivable Lien, (y) on the Settlement Date on which such
Affiliate Receivable is purchased or substituted, no Rating
Event shall have occurred and be continuing and (z) the
Applicable Lease related thereto is an Eligible Applicable
Lease;
(ff) which is an "Eligible Receivable" under and as
defined in the Intercompany Purchase Agreement; and
(gg) with respect to a Receivable that has previously
been a Defaulted Receivable or Delinquent Receivable that was
repurchased or for which a substitution has been made, such
Receivable was repurchased at least 6 months prior to its
resale to the Purchasers and in respect of which the
applicable Obligor has been in full compliance with its
payment obligations thereunder for at least 3 consecutive
months;
(y) with respect to any Existing Receivable, at the date of its
purchase or substitution under the Existing Agreement pursuant to which
it was sold to the Old Administrative Agent, such Receivable which was
an "Eligible Receivable" (as defined in such applicable Existing
Agreement) at such date.
Notwithstanding any provision set forth in this definition of "Eligible
Receivable" (except clause (x)(ff)), any Receivable which otherwise
qualifies to be an "Eligible Receivable" and for which the Financed
Aircraft related thereto receives a conveyance
<PAGE>
20
number from the FAA on or prior to the Applicable Settlement Date after
the sale or substitution of such Receivable shall be deemed to be an
"Eligible Receivable. Further, a Receivable (other than an Existing
Receivable) created pursuant to a Contract under which (at the time of
purchase or substitution thereof) the amount scheduled to be
outstanding on any annual anniversary of the execution date of such
Contract (assuming all scheduled payments have been made prior to such
date) is greater than the amount which would have been so outstanding
on such date if payments on such Contract prior to such anniversary had
been made on a thirteen year mortgage-type amortization method,
assuming a balloon payment of 30% of the original sales price scheduled
for repayment at the end of the thirteenth year, shall not be an
"Eligible Receivable."
"ERISA": the Employee Retirement Income Security Act of 1974,
-----
as amended from time to time.
"Excess Mesa Receivables": as of any date of determination,
-----------------------
the Principal Balances of all Purchased Receivables in respect of Mesa
and all of its respective Affiliates to the extent such aggregate
Principal Balances exceed an amount equal to 10% of the Outstanding
Purchase Price on such date of determination (calculated after giving
effect to all proposed purchases and substitutions on such date but
excluding the Outstanding Purchase Price of Wholesale Receivables).
"Excess Spread": as defined in subsection 2.16(b)(vi).
-------------
"Excluded Taxes" means, with respect to the Managing Facility
--------------
Agent, the Administrative Agent, either Co-Administrative Agent, any
Purchaser or any other recipient of any payment to be made by or on
account of any obligation of the Seller hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the
United States of America or by the jurisdiction under the laws of which
such recipient is organized or in which its principal office is located
or, in the case of any Purchaser, in which its applicable purchasing
office is located, (b) any branch profits taxes imposed by the United
States of America or any similar tax imposed by any other jurisdiction
in which the Seller is located and (c) in the case of a Foreign
Purchaser (other than an assignee pursuant to a request by the Seller
under subsection 2.26(b)), any withholding tax that is imposed on
amounts payable to such Foreign Purchaser at the time such Foreign
Purchaser becomes a party to this Agreement or is attributable to such
Foreign Purchaser's failure or inability to comply with Section
2.23(e), except to the extent that such Foreign Purchaser's assignor
(if any) was entitled, at the time of assignment, to receive additional
amounts from the Seller with respect to such withholding tax pursuant
to Section 2.23(a).
"ExIm Bank": the Export-Import Bank of the United States and
---------
any successor thereto.
"ExIm Bank Receivable": a Receivable, the payments of which
--------------------
are insured by the ExIm Bank.
<PAGE>
21
"Existing Agreements": the collective reference to the
-------------------
Existing Commuter Agreement and the Existing GA Agreement.
"Existing Affiliate Receivable": each Existing Receivable
-----------------------------
which, on and as of the Effective Date, is an "Affiliate Receivable"
under and as defined in the Existing Agreement pursuant to which the
Old Administrative Agent purchased such Receivable.
"Existing Certified Receivable": each Existing Receivable
-----------------------------
which, on and as of the Effective Date, is a "Certified Foreign
Receivable" under and as defined in the Existing Agreement pursuant to
which the Old Administrative Agent purchased such Receivable.
"Existing Commuter Agreement": the Amended and Restated
---------------------------
Purchase and Sale Agreement dated as of March 8, 1996 among Raytheon
Credit, the purchasers referred to therein, Swiss Bank Corporation, New
York Branch, as administrative agent, Bank of America NT&SA, as
documentation agent and co-agent, and Swiss Bank Corporation, New York
Branch, as co-agent, as amended, supplemented or otherwise modified
from time to time.
"Existing GA Agreement": the Second Amended and Restated
---------------------
Purchase and Sale Agreement dated as of March 8, 1996 among Raytheon
Credit, the purchasers referred to therein and Swiss Bank Corporation,
New York Branch, as agent, as amended, supplemented or otherwise
modified from time to time.
"Existing Outstanding Balance": as of any date of
----------------------------
determination for any Existing Receivable, the "Outstanding Balance"
thereof as determined under the Existing Agreement pursuant to which
such Existing Receivable was purchased prior to the Effective Date.
"Existing Outstanding Purchase Price": as of any date of
-----------------------------------
determination for any Purchaser, the sum of such Purchaser's
"Outstanding Purchase Price", if any, under each of the Existing
Agreements.
"Existing Principal Balance": as of any date of determination
--------------------------
for any Existing Receivable, the "Principal Balance" thereof as
determined under the Existing Agreement pursuant to which such Existing
Receivable was purchased by the administrative agent or agent under
such Existing Agreement.
"Existing Receivables": on the Effective Date, the collective
--------------------
reference to the outstanding "Purchased Receivables" under and as
defined in the Existing Agreements.
"Existing Registerable Lease Receivables": on the Effective
---------------------------------------
Date, the collective reference to the outstanding "Registerable Lease
Receivables" under and as defined in the Existing Agreements.
"Existing Uncertified Foreign Receivables": on the Effective
----------------------------------------
Date, the collective reference to the outstanding "Foreign Uncertified
Receivables" under and as defined in the Existing Agreements.
<PAGE>
22
"Expense Amounts": the collective reference to amounts
---------------
required to be paid pursuant to (i) subsections 2.17(a), 2.17(b),
2.17(c) and 2.17(d) and (ii) subsections 2.22, 2.23, 2.24 and 11.5 (to
the extent that the Managing Facility Agent, the Administrative Agent
or a Purchaser has made a demand therefor).
"Expiration Date": March 7, 2003 or, if the Revolving Period
---------------
is extended pursuant to subsection 2.8, 364 days after the date of the
Expiration Date in effect at the time of such extension.
"Extended Term Receivable": as of any Settlement Date, any
------------------------
Receivable the Final Payment Date of which is later than (i) so long as
no Rating Event has occurred and is continuing, thirteen years after
such Settlement Date and (ii) during the continuance of a Rating Event,
ten years after such Settlement Date, and, for purposes of subsection
2.15, any Receivable the Final Payment Date of which is extended
pursuant to subsection 7.1(b)(iv) to such later date.
"FAA": the Federal Aviation Administration or any successor
---
thereto.
"FAA Assignment": the assignment, certificate or other
--------------
document to be filed with the FAA Registry on or before the Closing
Date or any Settlement Date with respect to a Financed Aircraft related
to an Eligible Receivable to be purchased on the Closing Date or
purchased or substituted on such Settlement Date, substantially in the
form of (i) in the case of an assignment by the Seller of a security
interest in a Financed Aircraft granted by an Obligor in favor of the
Seller, Exhibit A-2 (for filing on the Closing Date) or Exhibit A-3
(for filing on each Settlement Date) or, (ii) with respect to a
Registerable Lease Receivable or an ExIm Bank Receivable, if the
Financed Aircraft related thereto is (or the lessee under the related
lease agrees will be) registered under the Aviation Act, in the case of
the grant by the Seller in favor of the Administrative Agent for the
ratable benefit of the Purchasers of a security interest in a Financed
Aircraft and amounts payable under the related lease entered into with
respect to such Lease Receivable or ExIm Bank Receivable, substantially
in the form of Exhibit A-4 (for filing on the Closing Date) or Exhibit
A-5 (for filing on a Settlement Date); in each case, with appropriate
modifications which may be required as a result of changes in any
Requirements of Law after the Closing Date pertaining to filings and
recordings with the FAA Registry.
"FAA Filing Date": as defined in subsection 6.1(n)(ii).
---------------
"FAA Registry": the FAA Aircraft Registry maintained on the
------------
Closing Date at the office of the FAA located in Oklahoma City,
Oklahoma.
"Final Payment Date": with respect to a Purchased Receivable,
------------------
the scheduled final maturity date (which, with respect to a Lease
Receivable, shall be the final scheduled rent payment date under the
related Contract) of such Receivable.
"Finance Charge Collections": (i) with respect to Purchased
--------------------------
Receivables constituting Lease Receivables a portion of the Collections
thereunder representing the interest component of such lease, such
interest component reflecting the interest rate as
<PAGE>
23
set forth in such lease and such portion being calculated in accordance
with Credit and Collection Policy, (ii) with respect to all other
Purchased Receivables, Collections on account of accrued finance
charges, late fees and similar items in respect of such Purchased
Receivables calculated, in each case, in accordance with the Credit and
Collection Policy and (iii) Collections deemed by the Managing Facility
Agent to be Finance Charge Collections pursuant to Section 2.16(a).
"Financed Aircraft": the Aircraft, together with all
-----------------
accessions thereto, securing an Obligor's indebtedness under a
Contract; provided that, the term "Financed Aircraft" when used herein
--------
or in any other document, instrument or certificate delivered pursuant
hereto shall mean or refer to, with respect to a Lease Receivable or an
ExIm Bank Receivable, the Aircraft leased under the Contract pursuant
to which such Lease Receivable was created, together with all
accessions thereto.
"Foreign Assignment": with respect to each Foreign Receivable
------------------
(other than a L/C Receivable) and each Affiliate Receivable, each
document, instrument, agreement (whether an assignment, security
agreement, mortgage or otherwise) and certificate appropriate for
filing in the applicable office in the applicable jurisdiction and
necessary to evidence (i) in the case of Affiliate Receivables and of
Foreign Receivables which are not Lease Receivables, the Lien in the
related Financed Aircraft granted by the Obligor thereon in favor of
Raytheon Credit and the assignment thereof by Raytheon Credit to the
Seller and (ii) in the case of all such Foreign Receivables and all
Affiliate Receivables, the Lien in the related Financed Aircraft
granted by the Seller (or, as applicable, the Lien thereon assigned by
the Seller) in favor of the Administrative Agent for the ratable
benefit of the Purchasers; and all other filings and recordings
necessary to perfect the Purchasers' first priority ownership or
security interests in and to the Foreign Receivables or the Affiliate
Receivables, as the case may be, and the related Contracts (including
Applicable Leases) and Financed Aircraft.
"Foreign Obligor": an Obligor which is not located (within the
---------------
meaning of Section 9-307 of the New York UCC) within the United States
and is not a citizen of the United States (as defined in the Aviation
Act).
"Foreign Purchaser" means any Purchaser that is not organized
-----------------
under the laws of the United States of America or a state thereof.
"Foreign Receivable": a Receivable the Obligor of which is a
------------------
Foreign Obligor.
"Foreign Wholesale Receivable": a Receivable arising under a
----------------------------
wholesale financing arrangement entered into by Raytheon Credit and, as
Obligor thereunder, a Dealer located (within the meaning of Section
9-307 of the New York UCC) outside the United States.
"Frozen Pool": as defined in subsection 2.8(b)(ii).
-----------
"GAAP": generally accepted accounting principles applied on a
----
consistent basis.
<PAGE>
24
"GA Receivable": a Receivable as to which the related Aircraft
-------------
is a General Aviation Aircraft and the Obligor of which does not own
and operate a commuter airline.
"General Aviation Aircraft": the collective reference to any
-------------------------
aircraft manufactured (including sub-assembly) by RAC for general
aviation purposes, and comparable general aviation aircraft
manufactured by any other Person including, in all cases, without
limitation, (i) any airframe, engines (whether or not any such engine
has 750 or more rated takeoff horsepower or the equivalent of such
horsepower, and including any replacement or substituted engine), and
avionics, equipment and accessories at any time attached to, connected
with or located in any such aircraft and, to the extent covered by the
recording system of the Aviation Act, all logs, manuals and maintenance
records with respect thereto and (ii) any avionics, equipment and
accessories removed from any Aircraft and, to the extent not covered by
the recording system of the Aviation Act, all logs, manuals and
maintenance records.
"Governmental Authority": 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.
"Guarantee": the Amended and Restated Guarantee, substantially
---------
in the form of Exhibit B, to be made by Raytheon in favor of the
Managing Facility Agent and the Purchasers, as the same may be amended,
supplemented or otherwise modified from time to time.
"Guarantee Reaffirmation": the Reaffirmation, executed by the
-----------------------
Guarantor and dated the Amendment Effective Date, consenting to the
execution of this Agreement by the Seller and the Servicer and
reaffirming the Guarantor's obligations under the Guarantee.
"Guarantor": Raytheon.
---------
"Increasing Purchaser": as defined in Section 5.3.
--------------------
"Indebtedness": with respect to any Person at any date, (a)
------------
all indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services (other than current liabilities
incurred in the ordinary course of business and payable in accordance
with customary trade practices) or which is evidenced by a note, bond,
debenture or similar instrument, (b) all obligations of such Person
under capital leases, (c) all obligations of such Person in respect of
acceptances issued or created for the account of such Person and (d)
all liabilities secured by any Lien on any property owned by such
Person even though such Person has not assumed or otherwise become
liable for the payment thereof.
"Indemnified Amounts": as defined in subsection 9.1(a).
-------------------
"Indemnified Person": as defined in subsection 9.1(a).
------------------
"Indemnified Taxes": Taxes other than Excluded Taxes.
-----------------
<PAGE>
25
"Indemnitee": as defined in subsection 11.5(c).
----------
"Ineligibility Event": with respect to any Purchased
-------------------
Receivable, any event of the type specified in (1) clauses (i), (ii) or
(iii) of subsection 2.11 or (2) clauses (vi) or (xii) of subsection
9.1(a).
"Ineligible Receivable": (a) with respect to any Purchased
---------------------
Receivable other than an Existing Receivable, such Receivable, (i) at
the date of its purchase or substitution, was not an Eligible
Receivable at such date, (ii) relates to a Financed Aircraft which did
not receive a conveyance number from the FAA on or prior to the third
Settlement Date (or if Raytheon's Debt Rating is no lower than A/A2,
the fourth Settlement Date; the third or fourth Settlement Date, as
applicable, the "Applicable Settlement Date") following the date of its
--------------------------
purchase or substitution or (iii) relates to a Financed Aircraft which
becomes a Remarketed Aircraft; and
(b) with respect to any Existing Receivable, such Receivable
(x)(i) at the date of its purchase or substitution under the
Existing Agreement pursuant to which it was sold to the
administrative agent or agent under such Existing Agreement,
was not an "Eligible Receivable" (as defined in such
applicable Existing Agreement) at such date or (ii) relates to
a Financed Aircraft which did not receive a conveyance number
from the FAA on or prior to the third Settlement Date (or if
Raytheon's Debt Rating is no lower than A/A2, the fourth
Settlement Date following the date of its purchase or
substitution under the applicable Existing Agreement; or
(y) relates to a Financed Aircraft which becomes a Remarketed
Aircraft; or
(z) on and as of the Closing Date (after giving effect to the
transactions contemplated under the Intercompany Purchase
Agreement on such date) such Receivable did not satisfy the
criteria specified in the following clauses under the
definition of "Eligible Receivable" herein (assuming for
purposes hereof, that such clauses are applicable to the
Existing Receivables): clauses (c), (h), (k), (l) (other than
any requirement that the related Financed Aircraft be free and
clear of Liens on such Effective Date), (m) (other than any
requirement that such Receivable be free and clear of Liens on
such Effective Date), (n)(ii), (o)(i), (x)(i), (y)(vi)(B),
(aa)(iv) or (ee)(x) except, that, (1) with respect to Existing
------ ----
Certified Receivables, prior to the Certified Opinion Delivery
Date, and with respect to all Existing Registerable Lease
Receivables, prior to the FAA Filing Date, any such Existing
Registerabl