<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
AVIATION SALES COMPANY
- -------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $.001 par value
- -------------------------------------------------------------------------------
(Title of Class of Securities)
053672 10 1
- -------------------------------------------------------------------------------
(CUSIP Number)
John A. Maraia
Corporate Counsel
Legal Department
Tomen America Inc.
1285 Avenue of The Americas
New York, New York 10019
(212) 397-5734
- -------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
June 26, 1996
- -------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box |_|.
Check the following box if a fee is being paid with the statement |X|. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of this class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
(Continued on following pages)
- --------
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON J/T Aviation Partners
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 1,576,000
See Item 5.
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 0
BY EACH REPORTING
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 1,576,000
See Item 5.
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 0
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,576,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON PN
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON TM Aviation (USA) Inc.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,576,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,576,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,576,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON TM Aviation (Japan) Inc.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,576,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,576,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,576,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON Tomen Corporation
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Japan
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,586,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,586,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,586,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON Japan Fleet Service (Delaware) Inc.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,576,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,576,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,576,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON Japan Fleet Service (Singapore) Pte. Ltd.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Singapore
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,586,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,586,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,586,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------- -----------------------------------
CUSIP NO. SCHEDULE
053672 10 1 13D
- -------------------------------------- -----------------------------------
<S> <C>
- ----------------------------------------------------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON Japan Fleet Service (Europe) B.V.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
- ----------------------------------------------------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A)|_|
(B)|_|
- ----------------------------------------------------------------------------------------------------------------------------
3. SEC USE ONLY
- ----------------------------------------------------------------------------------------------------------------------------
4. SOURCE OF FUNDS WC
- ----------------------------------------------------------------------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS |_|
REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
- ----------------------------------------------------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION Netherlands
- ----------------------------------------------------------------------------------------------------------------------------
NUMBER OF SHARES 7. SOLE VOTING POWER 0
BENEFICIALLY OWNED ---------------------------------------------------------------------------------------
8. SHARED VOTING POWER 1,576,000
BY EACH REPORTING See Item 5.
---------------------------------------------------------------------------------------
PERSON WITH 9. SOLE DISPOSITIVE POWER 0
---------------------------------------------------------------------------------------
10. SHARED DISPOSITIVE POWER 1,576,000
See Item 5.
- ----------------------------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,576,000
- ----------------------------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES |_|
- ----------------------------------------------------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 20.3%
- ----------------------------------------------------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON CO
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
NY1-148262.5
<PAGE>
Item 1. Security and Issuer
This Statement relates to the Common Stock, $.001 par value (the
"Shares"), of Aviation Sales Company, a corporation organized and existing
under the laws of the State of Delaware (the "Company"). The address of the
principal executive office of the Company is 6905 N.W. 25th Street, Miami,
Florida 33131-1704.
Item 2. Identity and Background
(a, b, c and f) This Statement is being filed by (i) J/T Aviation
Partners, a Delaware general partnership ("J/T"), the principal business of
which is to hold an investment in the Company, (ii) TM Aviation (Japan) Inc.,
a Delaware corporation ("TM Japan"), the principal business of which is to act
as a general partner of J/T, (iii) TM Aviation (USA) Inc., a Delaware
corporation ("TM USA"), the principal business of which is to act as a general
partner of J/T, (iv) Japan Fleet Service (Delaware) Inc., a Delaware
corporation ("JFS Delaware"), the principal business of which is to act as a
general partner of J/T, (v) Japan Fleet Service (Europe) B.V., a Netherlands
corporation ("JFS Europe"), the principal business of which is aircraft spare
parts leasing and to hold the capital stock of JFS Delaware, (vi) Tomen
Corporation, a corporation organized under the laws of Japan ("Tomen"), the
principal business of which is a general trading company (sogo shosha)
involved in domestic and foreign trading of a wide range of products,
including foodstuffs, apparel, housing, industrial plant, tankers, aircraft
and minerals and (vii) Japan Fleet Service (Singapore) Pte. Ltd., a Singapore
corporation ("JFS Singapore"), the principal business of which is aircraft and
aircraft spare parts leasing and general traders of aviation products and
services. The principal office of each of J/T, TM Japan and TM USA is c/o
Tomen America Inc., 1285 Avenue of the Americas, New York, New York 10019. The
principal office of Tomen is 14-27, Akasaka 2-Chome, Minato-Ku, Tokyo, Japan.
The principal office of each of JFS Delaware, JFS Europe and JFS Singapore is
c/o Japan Fleet Service (Singapore) Pte. Ltd., 10 Shenton Way No. 17-06/09,
MAS (Monetary Authority of Singapore) Building, Singapore 0207. TM Japan, TM
USA and JFS Delaware each own, respectively, a 35%, 15% and 50% general
partner interest in J/T. TM Japan and TM USA are wholly-owned subsidiaries of
Tomen. JFS Delaware is a wholly-owned subsidiary of JFS Europe and JFS
Singapore owns 60% of the capital stock of JFS Europe. Exhibit 1 hereto sets
forth the name, principal business, address and citizenship of each of the
executive officers and directors of TM Japan, TM USA, Tomen, JFS Delaware, JFS
Europe and JFS Singapore, and is incorporated herein by reference. J/T, TM
Japan, TM USA, Tomen, JFS Delaware, JFS Europe and JFS Singapore are referred
to herein individually as a "Reporting Person" and collectively as the
"Reporting Persons."
(d and e) During the last five years, none of J/T, TM Japan, TM USA,
Tomen, JFS Delaware, JFS Europe or JFS Singapore or any of the persons listed
on Exhibit 1 has been (i) convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors); or (ii) was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and
as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities law or finding any
violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
On February 14, 1992, TM Japan, TM USA and JFS Delaware entered into
the J/T Aviation Partners general partnership agreement for the purpose of
acquiring a partnership interest in AJT Capital Partners, a Delaware general
partnership ("AJT"). TM Japan contributed $1,400,000 for a 35% general
partnership interest, TM USA contributed $600,000 for a 15% general
partnership interest and JFS Delaware contributed $2,000,000 for a 50% general
partnership interest.
NY1-148262.5
<PAGE>
AJT was formed in February 1992. J/T contributed $3,840,000 for a
48% general partnership interest. On February 28, 1992, AJT acquired the
majority of the aircraft spare parts inventory of Eastern Airlines, Inc. from
the Trustee of the Estate of Eastern Air Lines, Inc. for a purchase price of
$64,500,000.
On December 2, 1994, AJT contributed net assets in the amount of
$3,729,977 to ASC Acquisition Partners, L.P., a Delaware limited partnership
("ASC Partners") in return for a 20% limited partnership interest. By virtue
of its 48% general partnership interest in AJT, J/T has a 9.6% limited
partnership interest in ASC Partners. In addition, on December 2, 1994, J/T
contributed $36,048 to Aviation Sales Management Company, a Delaware
corporation ("ASMC") in exchange for 360 shares of common stock, $100 par
value per share of ASMC which represented a 48% interest in ASMC. ASMC
contributed $75,000 to ASC Partners for a 2% general partnership interest.
Additionally, J/T contributed $1,404,000 to ASC Partners in exchange for a
37.44% limited partnership interest in ASC Partners. J/T also contributed $480
to each of Aviation Properties, a Delaware general partnership and Aviation
Properties of Texas, a Delaware general partnership in exchange for a 48%
general partnership interest in both partnerships.
On January 1, 1996, J/T sold a portion of its limited partnership
interest in ASC Partners in the amount of 6.48% to 5 senior members of
management of ASC Partners pursuant to options held by such members of
management. In return, J/T Partners received promissory notes in the aggregate
principal amount of $689,773.
On June 26, 1996, the limited partners of ASC Partners contributed
their limited partnership interests to the Company pursuant to an Exchange
Agreement by and among the Company and the limited partners of ASC Partners
(the "Exchange Agreement"). J/T received 973,000 shares of Common Stock plus
$8,835,000 for their 30.96% limited partnership interest in ASC Partners.
Additionally, AJT as a limited partner of ASC Partners with a 20% interest
received 1,000,000 shares of Common Stock of the Company pursuant to the
Exchange Agreement. In addition, on June 26, 1996, AJT was dissolved pursuant
to an Agreement to Dissolve by and between J/T and RCP Management L.P., a
Texas limited partnership and a 52% general partner of AJT. Pursuant to the
Amended and Restated Partnership Agreement of AJT dated November 30, 1994, J/T
as a 48% general partner received 480,000 shares of Common Stock of the
Company.
Pursuant to a Merger Agreement dated June 26, 1996, by and among
Aviation Sales Management Company, a Delaware corporation ("ASMC"), the
Company and Aviation Sales Operating Company, a Delaware corporation, ASMC was
merged into Aviation Sales Operating Company with each holder of shares of
common stock of ASMC receiving 133 1/3 shares of Common Stock of the Company
for one share of common stock of ASMC. J/T as a holder of 360 shares of ASMC
received 48,000 shares of Common Stock of the Company.
Pursuant to the Exchange Agreement, an additional 75,000 shares of
Common Stock of the Company owned by J/T is subject to an over-allotment
option granted to the underwriters of the Company's initial public offering.
J/T does not have possession of such shares at the present time and will only
obtain possession if the underwriters do not exercise such option by July 27,
1996.
Item 4. Purpose of Transaction
J/T, TM Japan, TM USA, Tomen, JFS Delaware, JFS Europe and JFS
Singapore currently intend to hold the Company's Shares for investment
purposes. Neither J/T, TM Japan, TM USA, Tomen, JFS Delaware, JFS Europe nor
JFS Singapore has any current intention to purchase additional Shares.
Other than as discussed herein, neither J/T, TM Japan, TM USA, Tomen,
JFS Delaware, JFS Europe nor JFS Singapore has any plans or proposals which
relate to or would result in (i) the acquisition of additional securities of
the Company or the disposition of securities of the Company; (ii) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation involving the Company
NY1-148262.5
<PAGE>
or any of its subsidiaries; (iii) a sale or transfer of a material amount of
assets of the Company or any of its subsidiaries; (iv) any change in the
present board of directors or management of the Company, including any plans
or proposals to change the number or term of directors or to fill any existing
vacancies on the board; (v) any material change in the present capitalization
or dividend policy of the Company; (vi) any other material change in the
Company's business or corporate structure; (vii) changes in the Company's
charter, bylaws or instruments corresponding thereto or other actions which
may impede the acquisition of control of the Company by any person; (viii)
causing a class of the Company's securities to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
(ix) a class of the Company's equity securities becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities and
Exchange Act of 1934; or (x) any action similar to any of those enumerated
above.
Item 5. Interest in Securities of Issuer
(a) J/T may be deemed to be the beneficial owner of 1,576,000 Shares.
Such Shares constitute 20.3% of the outstanding Shares (based on information
obtained from the Company). TM Japan through its 35% general partnership
interest in J/T may be deemed to be the beneficial owner of 1,576,000 Shares.
TM USA through its 15% general partnership interest in J/T may be deemed to be
the beneficial owner of 1,576,000 Shares. JFS Delaware through its 50% general
partnership interest in J/T may be deemed to be the beneficial owner of
1,576,000 Shares. Tomen Corporation through its wholly-owned subsidiaries, TM
Japan and TM USA, and through its employment of Kazatami Okui, a director of
the Company, who owns 10,000 stock options of the Company which are
immediately exercisable at an exercise price of $19.00 per share (the "Okui
Options"), may be deemed to be the beneficial owner of 1,586,000 Shares. JFS
Europe through its wholly-owned subsidiary, JFS Delaware, may be deemed to be
the beneficial owner of 1,576,000 Shares and JFS Singapore through its 60%
owned subsidiary, JFS Europe, and through its employment of Tim Lawrence
Watkins, a director of the Company, who owns 10,000 stock options of the
Company which are immediately exercisable at an exercise price of $19.00 per
share (the "Watkins Options") may be deemed to be the beneficial owner of
1,586,000 Shares.
To the knowledge of J/T, TM Japan, TM USA, Tomen, JFS Delaware, JFS
Europe and JFS Singapore, none of the persons described on Exhibit 1 owns any
of the Company's Shares except Kazutami Okui and Tim Lawrence Watkins,
directors of the Company, each own 10,000 stock options granted pursuant to
the Company's 1996 Director Stock Option Plan.
(b) Each of TM Japan, TM USA and JFS Delaware may be deemed to share
the power to vote or direct the vote and the power to dispose or direct the
disposition of the Shares owned by J/T. In addition, Tomen, by virtue of its
direct ownership of all of the stock of TM Japan and TM USA, may be deemed to
share with TM Japan, TM USA, JFS Delaware, JFS Europe and JFS Singapore, the
power to vote or direct the vote and the power to dispose or direct the
disposition of the Shares owned by J/T. JFS Europe, by virtue of its direct
ownership of all of the stock of JFS Delaware and JFS Singapore by virtue of
its 60% ownership interest in JFS Europe, may each be deemed to share with TM
Japan, TM USA, Tomen and with each other, the power to vote or direct the vote
and the power to dispose or direct the disposition of the Shares owned by J/T.
JFS Singapore through its employment of Tim Lawrence Watkins, a director of
the Company and the owner of the Watkins Options, may be deemed to share the
power to vote or direct the vote and the power to dispose or direct the
disposition of the Watkins Options with Mr. Watkins. Tomen, through its
employment of Kazutami Okui, a director of the Company and the owner of the
Okui Options, may be deemed to share the power to vote or direct the vote and
the power to dispose or direct the disposition of the Okui Options with Mr.
Okui.
(c) None in addition to the transactions described in Item 3.
(d-e) Not applicable.
NY1-148262.5
<PAGE>
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer
Except as described in Items 2, 3 and 4, there are no contracts,
arrangements, understandings or relationships (legal or otherwise) among the
persons named in Item 2 and between such persons and any person with respect
to any securities of the Company.
Item 7. Material to be Filed as Exhibits
The following exhibits are incorporated herein by reference:
1. Executive Officers and Directors of TM Aviation (Japan)
Inc., TM Aviation (USA) Inc., and Tomen Corporation, Japan
Fleet Service (Delaware) Inc., Japan Fleet Service (Europe)
B.V. and Japan Fleet Service (Singapore) Pte. Ltd. who are
not Reporting Persons.
2. Partnership Agreement of J/T Aviation Partners, dated
February 14, 1992.
3. First Amendment to Partnership Agreement of J/T Aviation
Partners, dated November 30, 1994.
4. Exchange Agreement by and among Aviation Sales Company and
the limited partners of ASC Acquisition Partners, L.P.,
dated June 26, 1996.
5. Agreement of Merger by and among Aviation Sales Management
Company, Aviation Sales Company and Aviation Sales Operating
Company dated as of June 24, 1996.
6. Amended and Restated Partnership Agreement of AJT Capital
Partners, dated November 30, 1994.
7. Agreement to dissolve AJT Capital Partners Partnership
Agreement between J/T Aviation Partners and RCP Management,
L.P. dated as of June 26, 1996.
8. Joint Filing Agreement between J/T Aviation Partners, TM
Aviation (Japan) Inc., TM Aviation (USA) Inc., Japan Fleet
Service (Delaware) Inc., Japan Fleet Service (Europe) B.V.,
Tomen Corporation and Japan Fleet Service (Singapore) Pte.
Ltd.
NY1-148262.5
<PAGE>
After reasonable inquiry and to the best of the
undersigned's knowledge and belief, the undersigned hereby certify that the
information set forth in this statement is true, complete and correct.
Dated: July 3, 1996
J/T AVIATION PARTNERS
By: JAPAN FLEET SERVICE (DELAWARE) INC.,
General Partner
For J/T Aviation Partners and as a Reporting Person
By: /s/ Tim L. Watkins
------------------------------
Name: Tim L. Watkins
Title: President
By: TM AVIATION (JAPAN) INC., General Partner
For J/T Aviation Partners and as a Reporting Person
By: /s/ K. Okui
------------------------------
Name: K. Okui
Title: President
By: TM AVIATION (USA) INC., General Partner
For J/T Aviation Partners and as a Reporting Person
By: /s/ T. Yoshida
------------------------------
Name: T. Yoshida
Title: President
TOMEN CORPORATION
By: /s/ K. Okui
------------------------------
Name: K. Okui
Title:
JAPAN FLEET SERVICE (Europe) B.V.
By: /s/ Tim L. Watkins
------------------------------
Name: Tim L. Watkins
Title: President
JAPAN FLEET SERVICE (Singapore) Pte. Ltd.
By: /s/ Tim L. Watkins
------------------------------
Name: Tim L. Watkins
Title: Managing Director
NY1-148262.5
<PAGE>
EXHIBIT INDEX
Exhibit Sequentially
Numbered Page
1. Executive Officers and Directors of TM Aviation (Japan) Inc., TM
Aviation (USA) Inc., and Tomen Corporation, Japan Fleet Service
(Delaware) Inc., Japan Fleet Service (Europe) B.V. and Japan Fleet
Service (Singapore) Pte. Ltd. who are not Reporting Persons.
2. Partnership Agreement of J/T Aviation Partners, dated February 14,
1992.
3. First Amendment to Partnership Agreement of J/T Aviation Partners,
dated November 30, 1994.
4. Exchange Agreement by and among Aviation Sales Company and
the limited partners of ASC Acquisition Partners, L.P.,
dated June 26, 1996.
5. Agreement of Merger by and among Aviation Sales Management
Company, Aviation Sales Company and Aviation Sales Operating
Company dated as of June 24, 1996.
6. Amended and Restated Partnership Agreement of AJT Capital Partners,
dated November 30, 1994.
7. Agreement to dissolve AJT Capital Partners Partnership Agreement by
and between J/T Aviation Partners and RCP Management, L.P. dated
as of June 26, 1996.
8. Joint Filing Agreement between J/T Aviation Partners, TM Aviation
(Japan) Inc., TM Aviation (USA) Inc., Japan Fleet Service (Delaware)
Inc., Japan Fleet Service (Europe) B.V., Tomen Corporation and Japan
Fleet Service (Singapore) Pte. Ltd.
NY1-148262.5
<PAGE>
EXHIBIT 1
Executive Officers and Directors of
TM Aviation (Japan) Inc., TM Aviation (USA) Inc.,
Japan Fleet Service (Delaware) Inc. Japan Fleet Service (Europe) B.V.,
Tomen Corporation and Japan Fleet Service (Singapore) Pte. Ltd.
Who Are Not Reporting Persons
The following sets forth certain information about executive
officers and directors of TM Aviation (Japan) Inc., TM Aviation (USA) Inc.,
Japan Fleet Service (Delaware) Inc., Japan Fleet Service (Europe) B.V., Tomen
Corporation and Japan Fleet Service (Singapore) Pte. Ltd. who are not
Reporting Persons. Each of such persons is a citizen of Japan, with the
exception of Tim Lawrence Watkins and Harold Marvin Woody, who are citizens of
the United States.
Present Principal Occupation or Employment;
Name, Principal Business, and Address in Which
Name and Residence or Such Employment is Conducted (if Different from
Business Address Business Address of Employer)
- --------------------- -----------------------------------------------
Yasuo Matsukawa President
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hideo Hirata Executive Vice President
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hisashi Takemura Executive Vice President
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Akihiro Tsuji Executive Vice President
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kazuo Miyaoka Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Takeshi Emi Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Susumu Matsui Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Yoshiaki Ueki Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
NY1-148262.5
1-1
<PAGE>
Exhibit 1 (cont'd)
Present Principal Occupation or Employment;
Name, Principal Business, and Address in Which
Name and Residence or Such Employment is Conducted (if Different from
Business Address Business Address of Employer)
- --------------------- -----------------------------------------------
Keiji Kuwata Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kichibe Ozaki Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Tsutomu Nishiwaki Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Katsuhiko Mizutani Senior Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Satoshi Miwa Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Tetsuki Nakagawa Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Naoyuki Matsunobu Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Morihiko Tashiro Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Yuzo Takeshige Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hajime Kawamura Managing Director
1285 Avenue of the Americas Tomen Corporation
New York, New York 10019
(business)
Mikio Omori Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
NY1-148262.5
1-2
<PAGE>
Exhibit 1 (cont'd)
Present Principal Occupation or Employment;
Name, Principal Business, and Address in Which
Name and Residence or Such Employment is Conducted (if Different from
Business Address Business Address of Employer)
- --------------------- -----------------------------------------------
Koichi Matsuura Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kiyobumi Yamada Managing Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hiroshi Uemura Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hiroyuki Tsuchimoto Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Yoshitaka Mangyoku Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Michio Ishidate Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Hajime Imanishi Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kenzo Inoue Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kazuhiko Otsuka Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Kouji Taira Director
14-27, Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan (business)
Yoshio Tadeno Director
14-27 Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan
NY1-148262.5
1-3
<PAGE>
Exhibit 1 (cont'd)
Present Principal Occupation or Employment;
Name, Principal Business, and Address in Which
Name and Residence or Such Employment is Conducted (if Different from
Business Address Business Address of Employer)
- --------------------- -----------------------------------------------
Yoji Kikkawa Director
14-27 Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan
Kimikazu Ushizaki Director
14-27 Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan
Minota Kano Director
14-27 Akasaka 2-chome Tomen Corporation
Minato-ku
Tokyo, Japan
Takashi Yoshida President and Director
14-27 Akasaka 2-chome TM Aviation (USA) Inc.
Minato-ku Vice President
Tokyo, Japan TM Aviation (Japan) Inc.
Kazuhiko Maeda Vice President
14-27 Akasaka 2-chome TM Aviation (USA) Inc.
Minato-ku
Tokyo, Japan
Kazutami Okui President and Director
14-27 Akasaka 2-chome TM Aviation (Japan) Inc.
Minato-ku
Tokyo, Japan
Akihiko Sato Vice President and Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Delaware) Inc.
MAS (Monetary Authority of Senior Executive Vice President,
Singapore) Building Chief Operating Officer and Director
Singapore 0207 Japan Fleet Service (Singapore) Pte. Ltd.
Director
Japan Fleet Service (Europe) B.V.
Tim Lawrence Watkins President and Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Delaware) Inc.
MAS (Monetary Authority of President, Chief Executive Officer
Singapore) Building and Director
Singapore 0207 Japan Fleet Service (Singapore) Pte. Ltd.
Director
Japan Fleet Service (Europe) B.V.
Harold Marvin Woody Vice President and Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Delaware) Inc.
MAS (Monetary Authority of Executive Vice President and Director
Singapore) Building Japan Fleet Service (Singapore) Pte. Ltd.
Singapore 0207
NY1-148262.5
1-4
<PAGE>
Exhibit 1 (cont'd)
Present Principal Occupation or Employment;
Name, Principal Business, and Address in Which
Name and Residence or Such Employment is Conducted (if Different from
Business Address Business Address of Employer)
- --------------------- -----------------------------------------------
Yasumasa Ono Chairman and Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Delaware) Inc.
MAS (Monetary Authority of Chairman
Singapore) Building Japan Fleet Service (Singapore) Pte. Ltd.
Singapore 0207
Keizaburo Fukushi Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Delaware) Inc.
MAS (Monetary Authority of Senior Executive Vice President,
Singapore) Building Chief Financial Officer and Director
Singapore 0207 Japan Fleet Service (Singapore) Pte. Ltd.
Director
Japan Fleet Service (Europe) B.V.
Toshihiko Koga Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Singapore) Pte. Ltd.
MAS (Monetary Authority of
Singapore) Building
Singapore 0207
Kazutami Okui Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Singapore) Pte. Ltd.
MAS (Monetary Authority of
Singapore) Building
Singapore 0207
Kazuhiko Iwahori Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Singapore) Pte. Ltd.
MAS (Monetary Authority of
Singapore) Building
Singapore 0207
Gen Koyama Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Singapore) Pte. Ltd.
MAS (Monetary Authority of
Singapore) Building
Singapore 0207
Yoichiro Nakamura Director
10 Shenton Way # 17-06/09 Japan Fleet Service (Singapore) Pte. Ltd.
MAS (Monetary Authority of
Singapore) Building
Singapore 0207
NY1-148262.5
----------------------
PARTNERSHIP AGREEMENT OF
J/T AVIATION PARTNERS
----------------------
February 14, 1992
<PAGE>
TABLE OF CONTENT8
OF
PARTNERSHIP AGREEMENT
OF
J/T AVIATION PARTNERS
Page
----
ARTICLE 1 ................................................................ 1
1.1 Definitions .................................................... 1
ARTICLE 2 ................................................................ 4
2.1 Formation of Partnerehip ....................................... 4
2.2 Partnership Name ............................................... 4
2.3 Principal Office ............................................... 4
2.4 Term of Partnership ............................................ 4
2.5 Organization Certificate ....................................... 4
2.6 Organization of the Partnership ................................ 4
ARTICLE 3 ................................................................ 5
3.1 Purposes of the Partnership .................................... 5
3.2 Conditions Precedent to Formation of Partnership ............... 5
ARTICLE 4 ................................................................ 5
4.1 Initial Capital Contributions of the Partners .................. 5
4.2 No Mandatory Additional Contributions .......................... 5
4.3 Capital Accounts ............................................... 6
ARTICLE 5 ................................................................ 7
5.1 Rights and Obligations of the Partners ......................... 7
5.2 Compensation of the Partners and Affiliates .................... 9
5.3 Other Interests and Transactions ............................... 9
5.4 Designation of Partner Representative .......................... 10
5.5 Meetings of Partners ........................................... 10
5.6 Annual Audit ................................................... 10
5.7 Indemnification of the Partners ................................ 10
5.9 Tax Rules Governing the Partnership ............................ 11
5.10 Sale, Refinance or Transfer of All
or Substantially All of the Partnership Assets ............... 11
5.11 Option to Purchase Ramco Stock ................................. 11
6.1 Assignments of Ownership Interests.............................. 12
6.2 Assignment of Distributive Rights .............................. 12
6.3 Survival of Liabilities ........................................ 13
ARTICLE 7 ................................................................ 13
7.1 Partnership Allocations ........................................ 13
7.2 Fiscal Year and Accounting Method .............................. 13
7.3 Determination of Profit and Loss ............................... 13
7.4 Distributions .................................................. 14
7.5 Elections by Partnership as to Optional
Adjustment to Basis .......................................... 14
7.6 Time of Allocations ............................................ 14
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE 8 ................................................................ 14
8.1 Dissolution and Termination of the Partnership
or a Partner ................................................. 14
8.2 Liquidation of Assets .......................................... 15
8.3 Distribution of Proceeds from Liquidation ...................... 15
8.4 Indemnification of the Liquidating Trustee ..................... 15
ARTICLE 9 ................................................................ 16
9.1 Arbitration .................................................... 16
9.2 Venue .......................................................... 16
9.3 Procedures; Scope of Arbitration ............................... 16
9.4 Selection of Arbitrators ....................................... 16
9.5 Jurisdiction of the District Court ............................. 17
9.6 Costs and Expenses ............................................. 17
ARTICLE 10 ............................................................... 17
10.1 Notices ........................................................ 17
10.2 Law Governlng .................................................. 18
10.3 Amendments ..................................................... 18
10.4 Successors and Asslgns ......................................... 18
10.5 Counterparts ................................................... 18
10.6 Gender and Number .............................................. 18
10.7 Severability ................................................... 18
10.8 Headings ....................................................... 19
10.9 References ..................................................... 19
10.10 Payment of Legal Fees .......................................... 19
ii
<PAGE>
PARTNERSHIP AGREEMENT
OF
J/T AVIATION PARTNERS
THIS PARTNERSHIP AGREEMENT OF J/T AVIATION PARTNERS is made and entered
into effective as of February 14, 1992, by and between Japan Fleet Service
(Delaware) Inc., ("JFS (Delaware)"), TM Aviation (Japan) Inc. ("TM (Japan)") and
TM Aviation (USA) Inc. ("TM (USA)") each a Delaware corporation, as Partners.
W I T N E S E T H:
WHEREAS, the Partners desire to join together in the partnership formed
hereby to acquire a partnership interest in AJT Capital Partners, a Delaware
general partnership of which the other partner shall be RCP Management L.P., a
Texas Limited partnership ("RCP"); and
WHEREAS, the Partners desire to formalize their understanding and
agreement" and reduce such agreements to writing;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the parties hereto agree as follows:
ARTICLE 1
1.1 Definitions. As used in this Agreement, the following terms shall have
the respective meanings indicated:
(a) "Affiliate" means, with respect to a Partner, a Person that,
either directly or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, such Partner. The term
"control", as used in the immediately preceding sentence, mean, with
respect to a Person that is a corporation, the right to exercise directly
or indirectly, more than ten percent (10%) of the voting rights
attributable to the shares of the controlled corporation and, with respect
to a Person that is not a corporation, being in possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of the Person.
(b) "Agreement" means this Partnership Agreement, as amended from time
to time.
(c) "Bankruptcy" means, as to any Partner, that Partner's taking or
acquiescing in the taking of any action seeking relief under, or advantage
of, any applicable debtor relief, liquidation, receivership,
conservatorship, bankruptcy, moratorium,
<PAGE>
rearrangement, insolvency, reorganization, or similar law affecting the
rights or remedies of creditors generally, as in effect from time to time.
For the purpose of this definition, the term "acquiescing" shall include,
without limitation, the failure to file, within sixty (60) days after its
entry, a petition, answer, or motion to vacate or to discharge any order,
judgment, or decree providing for any relief under any such law.
(d) "Capital Account" means the account established for each Partner
pursuant to Section 4.3 hereof.
(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Effective Date" means the date on which all conditions precedent
to the formation and organization of this Partnership specified in Section
3.2 have been satisfied in full.
(g) "Initial Capital Contribution" means the amount of capital
contributed by the Partners to the Partnership, as described in Section 4.1
hereof.
(h) "Liquidating Trustee" means the Person appointed pursuant to
Section 8.2 hereof, to supervise the liquidation of the Partnership.
(i) "Net Cash Flow" means all gross revenues of the Partnership from
all sources, including, without limitation, the Partnership Assets, less
all cash expenses and disbursements of the Partnership of any kind and
nature (but not including non-cash expenses or items, such as depreciation
and amortization) and shall be calculated on a calendar quarter basis.
(j) "Ownership Interest" means the interest in the Partnership owned
by a Partner in accordance with Sections 4.1, 4.3. 7.1 and 7.4 hereof.
(k) "Partner" means JFS (Delaware), TM (Japan) or TM (USA).
(1) "Partners' means JFS (Delaware), TM (Japan) and TM (USA).
(m) "Partnership" means the general partnership formed pursuant to
this Agreement.
(n) "Partnership Assets" means the real, personal and intangible
property owned by the Partnership from time to time, including, without
limitation, its interest in AJT Capital Partners.
2
<PAGE>
(o) "Partnership Law" means the Delaware Uniform Partnership Law,
Delaware Code Annotated, Title 6, Chapter 15, as amended from time to time.
(p) "Person" means an individual, partnership, corporation, trust,
unincorporated association, or other entity or association.
(q) "Profits. and "Losses" means, for each Partnership Year, an amount
equal to the Partnership's taxable income or loss for such year or period,
determined in accordance with Code Section 703(a) (for this purpose, all
items of income, gain, loss, or deduction required 'to be stated separately
pursuant to Code Section 702(a)(1) shall be included in taxable income or
loss), with the following adjustments:
(i) Any income of the Partnership that is exempt from federal
income tax and not otherwise taken into account in computing Profits
and Losses pursuant to this Section shall be added to such taxable
income or loss;
(ii) Any expenditures of the Partnership described in Code
Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B)
expenditures pursuant to the regulations issued thereunder, and not
otherwise taken into account in computing Profits and Losses pursuant
to this Section shall be subtracted from such taxable income or loss;
and
(iii) All items of Partnership income, gain, loss, or deduction
shall be computed without reference to any basis adjustments under
Code Sections 732(d), 734(b) or 743(b).
For purposes of this definition of "Profits" and "Losses", references to Code
Sections and the regulations issued pursuant thereto are to the Code and related
regulations in effect as of the Effective Date.
(r) "Ramco" means Ramco American International, Inc., a New Jersey
corporation.
(s) "Ramco Stock Option Agreement" means that certain stock option
agreement by and between ARAC, as the Purchaser, and Ramco and the
shareholders of Ramco, as the Sellers, whereby the shareholders of Ramco
have granted an option to ARAC to purchase fifty-six percent (56%) of the
issued and outstanding capital stock of Ramco.
(t) "Reserves" as to any period means the amount allocated by the
Partners to a reserve account established for the Partnership for
contingent liabilities, working capital, and payment of other obligations,
costs, or expenses.
3
<PAGE>
Each of the following terms is defined in the part or Section of this
Agreement set opposite such term:
Affected Partner Section 8.1(a)
AJT Capital Partners Preamble
Capital Account(s) Section 4.3
Claimant Section 9.4
Dispute Section 9.1
Dissolution Event Section 8.1(a)
Indemnified Parties Section 5.7
JFS (Delaware) Preamble
Partnership Year Section 7.2
Tax Matters Partner Section 5.9
Term Section 2.4
TM (Japan) Preamble
TM (USA) Preamble
ARTICLE 2
2.1 Formation of Partnership. The parties hereto hereby form the
Partnership pursuant to the Partnership Law. The rights and liabilities of the
Partners shall, except as hereinafter expressly stated to the contrary, be
governed by the laws of Delaware.
2.2 Partnership Name. The business of the Partnership shall be conducted
under the name of "J/T Aviation" or such other name as the Partners may select
from time to time.
2.3 Principal Office. The principal place of business of the Partnership
shall be at the offices of Tomen America Inc., 1285 Avenue of the Americas, New
York, New York 10019, or at such other location as may be agreed upon by the
Partners.
2.4 Term of Partnership. The Partnership shall commence on the Effective
Date, and shall continue as provided herein until dissolved pursuant to Section
8.1 hereof (such period of time, the "Term").
2.5 Organization Certificate. The Partnership shall immediately execute,
file, record and/or publish such certificates and other documents, and take all
other appropriate action, to comply with all legal requirements for the
formation of a general partnership under the Partnership Law, and its operation
in the states in which it will conduct business.
2.6 Organization of the Partnership. The Partners shall join to form the
Partnership. It is expressly understood and agreed that no Additional Partner
shall be admitted to the Partnership except as specifically provided herein.
4
<PAGE>
ARTICLE 3
3.1 Purposes of the Partnership. The purposes of the Partnership shall be
(a) to acquire, own, hold for investment, sell or exchange a 47.5% general
partnership interest in AJT Capital Partners; (b) to borrow funds to the extent
the Partners shall all agree from time to time to facilitate the Partnership' 5
business activities provided for under this Section 3.1, and to pledge all or
any portion of the Partnership Assets as security for such debt; (c) to perform
any other acts or engage in any other business(es) as to which the Partners
agree; and (d) to take any and all actions necessary and prudent in furtherance
of the foregoing purposes; provided, however, that no actions taken under this
Section 3.1(d) shall be inconsistent with Sections 3.1(a) through (c) hereof.
3.2 Conditions Precedent to Formation of Partnership. The obligations of
the PartnerS hereunder, including the obligation to contribute their respective
Initial Capital Contributions, shall be subject to the fulfillment to the
reasonable satisfaction of each Partner of each of the conditions precedent Set
forth in Section 3.2 of the partnership agreement of AJT Capital Partners (or
the waiver thereof by all of the Partners), each of which conditions precedent
(and definitions, Schedules or Exhibits necessary to define terms in such
incorporated provisions) are incorporated by reference as if set forth fully
herein.
ARTICLE 4
4.1 Initial Capital Contributions of the Partners. Upon satisfaction of the
conditions precedent specified in Section 3.2, the Partner" shall contribute to
the Partnership the following amounts as their respective Initial Capital
Contributions:
Initial Capital Percentage
Contribution Ownership Interest
------------ ------------------
JFS (Delaware): $2,000,000 50%
TM (USA): 600,000 15%
TM (Japan): 1.400.000 35%
---------- ---
Total: $4,000,000 100.0%
In return for such contributions, each Partner will receive such Partner's
Ownership Interest in the Partnership in accordance with the provisions of this
Agreement.
4.2 No Mandatory Additional Contributions. The Partners shall have no
mandatory obligations to contribute additional capital to the Partnership.
5
<PAGE>
4.3 Capital Accounts.
(a) Capital Accounts. An individual non-interest bearing capital
account shall be maintained for each Partner which shall reflect the value
of its investment in the Partnership (a "Capital Account.).
(b) Credits to or Increases of Capital Accounts. The Capital Account
of each Partner shall be credited with or increased bY the following:
(i) The amount of any money the Partner contributed or
contributes to the Partnership, including, but not limited to, money
contributed pursuant to Section 4.! hereof;
(ii) The fair market value of any property the Partner
contributes to the Partnership (net of any liabilities secured by such
contributed property that the Partnership assumes or takes the
Property subject to);
(iii) The amount of Profits allocated to the Partner under
Section 7.1 hereof; and
(iv) The income or gain inherent in any property the Partnership
distributes to the Partner to the extent such income or gain has not
been previously reflected in the Capital Accounts.
(c) Reductions of Capital Accounts. The Capital Account of each
Partner shall be debited with or reduced by the following:
(i) The amount of money the Partnership distributes to the
Partner pursuant to Section 7.4 or 8.3 hereof;
(ii) The fair market value of any property the Partnership
distributes to the Partner pursuant to Section 7.4 or 8.3 hereof (net
of any liabilities secured by such contributed property that the
Partner assumes or takes the property subject to);
(iii) The amount of Losses allocated to the Partner under Section
7.1 hereof;
(iv) The deduction or loss inherent in any property the
Partnership distributes to the Partner to the extent such deduction or
loss has not been previously reflected in the Capital Accounts; and
(v) The amount of any tax withheld or paid by the Partners with
respect to the Partner under applicable law.
6
<PAGE>
ARTICLE 5
5.1 Rights and Obligations of the Partners. (a) The Partners acting jointly
shall have full and complete authority and discretion to manage and control the
Partnership and to make all decisions affecting the management and operation of
the Partnership's business. The Partners shall from time to time jointly
establish such operation and management plans and budgets as they may deem
appropriate for the conduct of the Partnership's business. Except as
specifically delegated to the Administrative Partner pursuant to Section 5.1(b)
hereof, all action" of the Partnership shall require the consent of all
Partners.
(b) TM (USA) will be the Administrative Partner for the Partnership. As
such, TM (USA) will be responsible for managing the day-to-day business and
affairs of the Partnership in a prudent and business-like manner. The
Administrative Partner shall have the authority, right, power, and
responsibility on behalf of and at the cost and expense of the Partnership:
(1) to open, maintain, and close bank accounts with such financial
institutions as the Partners may approve and establish signatories on
such accounts and draw checks and other order" for the payment of
Partnership obligations in each case consistent with policies
established by the Partners;
(2) to prepare for the consideration and approval of the Partners such
budgets and business plans as the Partners may reasonably request from
time to time and, following approval by the Partner" of such budgets
and plans, to expend fund" as contemplated in such budgets and plans,
but only to the extent the Administrative Partner believes prudent in
light of circumstances;
(3) to submit any claims or liabilities to arbitration, to settle claims
and confess judgments, to prosecute, defend, and settle lawsuits, and
to handle all matters with governmental agencies, or authorities from
time to time having jurisdiction over the Partnership;
(4) to the extent contemplated by the budget" and plans approved by the
Partners, to engage employees, consultants, accountants, attorneys,
and any and all other agents and assistants, both professional and
non-professional, as the Administrative Partner may deem necessary,
appropriate, or advisable in furtherance of the purpose. of the
Partnership, and to compensate such Persons for services rendered;
(5) to the extent of the budgets and plans approved by the Partners, to
maintain insurance of the types and in such amount" as would be
consistent with industry
7
<PAGE>
standards and prudent business judgment to be maintained by a Person
in the same business as the Partnership;
(6) to collect all sums due and owing from third parties to the
Partnership;
(7) to maintain complete and accurate books of the Partnership, showing
all receipt=, income, expenditures, assets and liabilities, profits
and losses, and all other records necessary for recording the
Partnership's business and affairs, and furnishing the Partners all
reasonable and necessarY tax reporting information;
(8) to the extent that funds of the Partnership are available therefor, to
pay as they become due all debts and obligations of the PartnershiP:
(9) pending expenditure of Partnership funds for Partnership purposes, to
invest Partnership funds with such financial institutions as the
Administrative Partner may designate; provided, however, that the
Partnership's cash funds shall be invested in AAA rated commercial
paper, certificates of deposit in domestic banks having a net worth in
excess of 8100,000,000.00, legal investments under the laws of the
State of New York or United States Treasury Bills having a maturity of
not more than one year;
(10) subject to the budgets and plans approved by the Partners, to enter
into contract=, commitments, and agreements with Persons (including
Affiliates of Partners) on behalf of the Partnership, for Partnership
purpose=;
(11) to make distributions of Net Cash Flow in accordance with the terms
and conditions of this Agreement; and
(12) to take any and all other action that the Administrative Partner may
deem necessary, appropriate, or advisable in furtherance of Sections
5.1(a) (1)-(11) and not inconsistent with this Agreement; provided,
however, that, notwithstanding anything to the contrary herein, the
Administrative Partner shall not have the right to do any of the
following without the written consent of JFS (Delaware) and TM
(Japan):
(i) Borrow money in the Partnership name or from the Partnership for
any purpose or utilize any of the Partnership Assets as security
for loans;
(ii) Make, execute or deliver any assignment for the benefit of
creditors, bond, confession of judgment, mort-
8
<PAGE>
gage, deed, guaranty or contract of sale with respect to any of
the Partnership Assets.
(iii) Utilize Partnership Assets in any way for the furtherance of its
or any of its Affiliates or associates (as defined in the
Regulations under the Securities Act of 1933) personal business
activities;
(iv) Make, arrange for, cancel, modify, renew or otherwise rearrange
any financing or refinancing with respect to the Partnership
Asset-;
(v) Sell, lease, exchange or otherwise transfer all or substantially
all of the Partnership Assets;
(vi) Make any distributions other than as provided in Articles 7 or 8
hereof;
(vii) Loan any of the Partnership's funds to any Person;
(viii) Incur expenditures in excess of the budgets established by the
Partners from time to time;
(ix) Cause the Partnership to enter into any joint venture; or
(x) Take any action on behalf of the Partnership not in furtherance
of the Partnership'= purposes, as set forth in Section 3.1
hereof.
5.2 Compensation of the Partners and Affiliates. Subject to the budgets
established by the Partners from time to time, the Partners "hall be entitled to
be reimbursed for all other out-of-pocket costs and expenses incurred in
connection with the administration and operation of the Partnership, which shall
include, but not be limited to, any incremental franchise and similar taxes
incurred by the Partner" by reason of the structure of the Partnership or this
Agreement. Except a" specifically provided herein, no Partner shall be entitled
to any compensation by way of salary or percentage return on the Capital
Accounts, other than a share of Profit" and Net Cash Flow as herein expressly
provided.
5.3 Other Interests and Transactions. No Partner shall, merely by virtue of
its interest in the Partnership, be in any way prohibited from, or restricted in
engaging in, or possessing an interest in, any other business venture of any
nature, including any venture engaged in the acquisition, ownership and/or
marketing of aircraft and engine spare parts. Any Partner may engage in
transactions for its own account and for the accounts of others during the Term
of this Agreement, whether or not such activities are deemed competitive with
the Partnership.
9
<PAGE>
5.4 Designation of Partner Representative. Each Partner shall designate a
representative to receive notices and respond to requests for consents under
this Agreement. For purposes of this Section 5.4, the designated representative
of JFS (Delaware) shall be Tim L. Watkins, the designated representative of TM
(Japan) shall be Kazutami Okui, and the designated representative of TM (USA)
shall be Hideo Funatsu, and of TN (USA) and TM (Japan) Jointly "hall be Hideo
Funatsu. A Partner shall have the right to change its designated representative
by written notice to the other Partners in accordance with Section 10.1 hereof .
5.5 Meetings of Partners. A meeting of the Partners shall be held at such
times and at such places as determined by the Partners. The Partners may hold a
meeting over the telephone or through written consents or correspondence.
5.6 Annual Audit. The Partners shall cause an audit to be made of the
financial condition of the Partnership for each fiscal year of the Partnership
within a reasonable time after the close of each fiscal year (but not later than
March 15). Such audit shall be performed by a "Big Six" accounting firm selected
by TM (USA) and approved by TM (Japan) and JFS (Delaware), and the cost of such
audit shall be paid by the Partnership. Any Partner may, at any time and at the
Partnership's expense, cause an audit to be made of the financial condition of
the Partnership.
5.7 Indemnification of the Partners. The Administrative Partner shall not
be liable to either of the other Partners or their Affiliates or shareholders
for any loss of their respective contributions to the Partnership or any Profit
of the Partnership for any act or omission of the Administrative Partner unless
such loss shall have resulted, directly or indirectly, from the gross negligence
or willful misconduct of the Administrative Partner or the material breach of
its obligations hereunder. To the full extent permitted by applicable law the
Partners, their shareholders, officers, directors' employees and agents
("Indemnified Parties") shall be indemnified and held harmless by the
Partnership (but only to the extent that the Partnership assets are sufficient
therefor) from and against, and the Partnership shall reimburse the Indemnified
Parties for, all judgments, penalties, including excise and similar taxes,
fines, settlements and reasonable expenses if such Indemnified Party was, is, or
is threatened to be named as a defendant or respondent Ln any legal proceeding
based upon or arising out of their having acted as the Partner hereunder. Except
as set forth in this Section, the foregoing shall be deemed to make mandatory
the indemnifications permitted under Section 1518(2) of the Partnership Law and
to authorize advance payment of expenses to the full extent permitted by
applicable law. It is expressly stipulated, however, that the Indemnified
Parties shall not be entitled to indemnification hereunder where the claim at
issue is based upon:
10
<PAGE>
(1) the gross negligence, willful misconduct or criminal act of an
Indemnified Party; or
(2) the materia1 breach by a Partner of any provision of this
Agreement.
The indemnification rights herein contained shall be cumulative of, and in
addition to, any and all other rights, remedies, and recourses to which the
Indemnified Parties shall be entitled, whether pursuant to this provision or
some other provision of this Agreement, at law or in equity.
5.8 Restrictions. Without the written consent of all of the Partners, no
Partner shall:
(1) Amend or modify this Agreement;
(2) Pledge, hypothecate or in any manner sell, assign or transfer such
Partner's Ownership Interest, except as otherwise provided herein; or
(3) Withdraw from the Partnership.
5.9 Tax Rules Governing the Partnership.
(1) The Partners hereby acknowledge and agree that it is the intention
of the Partnership to be governed by the provisions of Subchapter K of the
Code, and all rules and regulations promulgated thereunder. The Partners
shall take any and all actions necessary to insure full compliance by the
Partnership of all such applicable provisions, rules and regulations,
including, but not limited to, the filing of information returns as
required by Section 6031 of the Code, or similar provisions of later law.
(2) TM (USA) shall serve as the "Tax Matters Partner" for the
Partnership for purposes of and under the Code. As Tax Matters Partner, TM
(USA) shall keep the Partners informed of all administrative and judicial
proceedings, as required by Section 6223(g) of the Code, and shall furnish
to the Partners a copy of each notice or other communication received by TM
(USA) from the Internal Revenue Service.
5.10 Sale. Refinance or Transfer of All or Substantially All of the
PartnershiP Assets. Without the written consent of all of the Partner=, the
Partnership shall not sell, convey, assign, lease, pledge, mortgage or transfer
all or any substantial portion (in a single transaction or a related series of
transactions) of the Partnership Asset" or enter into a contract to do the same.
5.11 Option to Purchase Ramco Stock. Under the terms of the Ramco Stock
Option Agreement, the shareholders of Ramco have granted to AJT Capital Partners
an option to purchase up to
11
<PAGE>
fifty-six percent (56%) of the outstanding capital stock of Ramco for a period
of three (3) years from and after the effective date of the Ramco Stock Option
Agreement. Under the terms of the partnership agreement of AJT Capital Partners,
either RCP or the Partnership may trigger the option, after which the other
partner must respond. The Partners agree that no Partner singly shall have the
authority or power to trigger the option; all Partners must agree in order to
trigger the option.
ARTICLE 6
6.1 Assignments of Ownership Interests.
(a) No Partner may sell, assign, transfer, pledge, mortgage, or grant
a lien or security interest in its Ownership Interest, or portions of such
Ownership Interest, and thereby constitute the vendee or assignee a
substituted Partner, without first having obtained the written consent of
the other Partners.
(1) JFS (Delaware) shall be deemed to have sold, assigned or
transferred its Ownership Interest, if any stock of JFS (Delaware) is
sold, assigned or transferred unless Japan Fleet Service (Singapore)
Pte. Ltd. or an Affiliate of Japan Fleet Service (Sinsapore) Pte. Ltd.
retains control of JFS (Delaware).
(2) TM (Japan) and TM (USA) shall each be deemed to have sold,
assigned or transferred its Ownership Interest, if any stock of TM
(Japan) and TM (USA) is sold, assigned or transferred unless Tomen
America Inc. and/or Tomen Corporation and/or an Affiliate of either
retains control of TM (Japan) and TM (USA).
(b) For purposes of this Section, the term "control" shall mean (i)
the right to vote directly or indirectly at least 511 of the total voting
power of all classes of stock of the entity in the case of a corporation or
(ii) the power to direct or cause the direction of the management or
policies of the Person.
(c) Upon any transfer of a Partner's Ownership Interest satisfying the
provisions of this Section, and the transferee's agreement to become bound
by all of the provisions of this Agreement, the transferee shall become a
substituted Partner.
6.2 Assignment of Distributive Rights.
(a) A Partner may assign to any Person all or any portion of such
Partner's right to receive distributions hereunder. No such assignment
shall be effective as to the Partnership unless the non-assigning Partner
has received fifteen (15) business days prior written notice of such
proposed assignment, which shall include a description of the proposed
transaction (including the
12
<PAGE>
amount of the proposed transfer), and the non-assigning Partner shall have
received:
(1) A copy of the instrument of assignment, in recordable form,
executed by both the assignor and the assignee of such distributive
right; and
(2) An instrument in such form as may be prescribed by or
otherwise acceptable to the Partnership, executed by the assignor,
instructing the Partnership as to what percentage, to whom, and where
such distributive share is to be paid.
(b) If the conditions described in Section 6.2(a) have been satisfied,
the Partnership may (but shall not be obligated to), without requesting
further documentation from either the assignor or the assignee, remit
directly to the named assignee all distributions to which such Partner may
be entitled pursuant to the provisions of this Agreement and the
assignment. So long as the party to whom such distributive share was
remitted was either the assignor or the assignee named in the instrument of
assignment, the Partnership shall be free from liability to any person if
such distribution is received by a person that is not entitled thereto.
6.3 Survival of Liabilities. It is expressly understood and agreed that no
sale or assignment of an Ownership Interest, even if it results in the
substitution of the assignee or vendee as a Partner herein, shall release the
assignor or vendor from those liabilities to the Partnership which survive such
assignment or sale as a matter of law.
ARTICLE 7
7.1 Partnership Allocations. Profits and Losses (including, to the extent
necessary, each item of income, gain, loss, deduction, and credit) shall be
allocated among the Partners in proportion to the Initial Capital Contributions
made by the Partners pursuant to Section 4.1 hereof. If the basis of any
Partnership Asset is adjusted as a result of an election made pursuant to
Section 754 of the Code, the tax consequences of that adjustment shall be
allocated to the Ownership Interest with respect to which the adjustment was
made. All distributions of property by the Partnership shall be made in
proportion to the Initial Capital Contributions of the Partners.
7.2 Fiscal Year and Accounting Method. The Partnership fiscal year shall be
the calendar year ("Partnership Year.) . The Partnership books shall be kept on
such method as is recommended by the accounting firm performing the review under
Section 5.6 hereof.
7.3 Determination of Profit and Loss. At the end of each Partnership Year,
all Partnership Profits and Losses shall be determined with respect to the
Ownership Interests of each Partner
13
<PAGE>
for the accounting period then ending and shall be allocated to the Capital
Accounts of the Partners. However, in instances where a Partner has sold,
assigned, transferred or otherwise disposed of all or part of its Ownership
Interest during such accounting period, all such allocations shall be made
between the transferor and the transferee in accordance with Section 706 of the
Code. The determinations made pursuant to this Section shall be binding on all
Partners.
7.4 Distributions. SubJect to the provisions of Section 8.3 hereof, the Net
Cash Flow of the Partnership "hall be distributed from time to time a: the
discretion of the Partners to the Partners as provided in Section 7.1 hereof.
7.5 Elections by Partnership as to Optional Adjustment to Basis. Where a
distribution of property is made in the manner provided in Section 734 of the
Code or where a transfer of Ownership Interest permitted by this Agreement is
made in the manner provided in Section 743 of the Code, the Tax Matters Partner
shall file on behalf of the Partnership, upon any remaining Partner's request,
an election under Section 754 of the Code in accordance with the procedures set
forth in the applicable treasury regulations issued under the Code.
7.6 Time of Allocations. Except as otherwise required by any other Sections
of this Agreement or the Code, allocations pursuant to this Article 7 shall be
made as of the last day of each Partnership Year.
ARTICLE 8
8.1 Dissolution and Termination of the Partnership or a Partner. The
Partnership shall continue until, and shall automatically dissolve on the date,
one year after the final distribution of AJT Capital Partners is made, unless
sooner dissolved upon the earliest to occur of any of the following events, any
of which shall cause an immediate dissolution of the Partnership:
(1) The dissolution, liquidation, resignation, removal, Bankruptcy, or
incapacity of a Partner, or the occurrence of any other act which would
legally disqualify or impede a Partner (the "Affected Partner.) from acting
hereunder (a "Dissolution Event");
(2) The unanimous consent of the Partners to dissolve;
(3) Within a reasonable time after the Partnership (i) ceases to
maintain any interest (including, without limitation, an interest a"
lienholder or secured party or right of redemption or repurchase) in the
Partnership Assets; and (ii) distributes to
14
<PAGE>
the Partners all proceed" from such sale, conveyance or transfer, if any;
or
(4) The occurrence of an event which would render the continuation of
the Partnership business or operation unlawful.
8.2 Liquidation of Assets. On the effective date of the dissolution of the
Partnership, TM (USA) {or JFS "Delaware) if TM (USA) or TM (Japan) causes such
dissolution) shall be appointed as agent of the dissolved Partnership in
liquidation, and of the Partners, for winding up all Partnership affairs and all
business transactions of the Partnership (the "Liquidating Trustee") . The
Liquidating Trustee shall continue to serve until the completion of the winding
up and liquidation, unless bankruptcy, insolvency or resignation shall
intervene. The Liquidating Trustee shAll not be paid for it" services after the
dissolution of the Partnership and the winding up for liquidating operations. It
may, out of the assets and proceeds of the asset" on hand, employ such
assistance a" it determines appropriate.
8.3 Distribution of Proceeds from Liquidation. In the event of dissolution
of the Partnership, the business affairs of the Partnership shall be wound up
and liquidated as promptly as business circumstances and orderly business
practices will permit. The proceeds of liquidation and all Partnership cash
shall be distributed in the following order:
(1) First, to Partnership creditors, funds, to the extent that they
are available, sufficient to extinguish current Partnership liabilities and
obligations, including the costs and expenses of liquidation; and
(2) Second, to the Partners in accordance with section 7.1 of this
Agreement.
Notwithstanding anything to the contrary set forth hereinabove, if after the
payment of current Partnership liabilities and obligations to the extent of the
funds and/or other assets available for that purpose, either any portion of
Partnership liabilities remains unpaid or the Liquidating Trustee determines
that additional funds will be required to meet Partnership costs and expenses
theretofore incurred or for which the Partnership may become responsible, then
the Liquidating Trustee shall be obligated to retain such required amounts, if
available (or as and when they become available), before any partnership cash or
other assets are distributed to any of the Partners.
8.4 Indemnification of the Liquidating Trustee. The Liquidating Trustee
"hall be indemnified and held harmless by the Partnership from and against any
and all claims, demands, liabilities, costs, damages and causes of action of any
nature whatsoever, arising out of or incidental to the Liquidating Trustee's
taking of any action authorized under, or within the scope of, this
15
<PAGE>
Article 8. The Liquidating Trustee shall not be entitled to indemnification
hereunder where the claim at issue arose out of:
(1) A matter entirely unrelated to the Liquidating Trustee's acting
under the provisions of this Article 8;
(2) The gross negligence, willful misconduct or criminal act of the
Liquidating Trustee; or
(3) The material breach by the Liquidating Trustee of its obligations
under this Article 8.
The indemnification rights herein contained shall be cumulative of, and in
addition to, any and all other rights, remedies and recourses to which the
Liquidating Trustee shall be entitled, at law or in equity.
ARTICLE 9
9.1 Arbitration. The Partners hereby agree that any and all claims,
disputes and controversies ("Dispute") arising out of or relating to the
interpretation or enforcement of this Agreement, the operation of its terms, or
the relationship of the parties hereunder "hall be decided by final and binding
arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association as supplemented hereby. For purposes of Disputes
hereunder, TM (USA) and TM (Japan) "hall be deemed to constitute a single
Partner and shall be entitled only to a single representative or arbitrator in
any Dispute. The arbitrators shall be entitled only to consider Disputes between
JFS (Delaware) on the one side and TM (Japan) /TM (USA) on the other.
9.2 Venue. The Partners bind themselves to arbitrate any Dispute in New
York, New York.
9.3 Procedures: Scone of Arbitration. The Partners further agree that (i)
an arbitration panel may render an interim ruling regarding discovery, summary
proceedings, or other pre-arbitration matter=, and (ii) all claims of any type
by any of the Partners, including any and all defenses, are included in the
jurisdiction of the arbitration.
9.4 Selection of Arbitrators. If any of the Partners desires to arbitrate
any Dispute, such Partner (the "Claimant") shall notify the other Partners and
the Office of the American Arbitration Association in New York, New York, of the
Dispute desired to be arbitrated, including a brief statement of the matter in
controversy. If the Partners are not able to resolve the Dispute within ten (10)
days after the Claimant notifies the other Partner as aforesaid, then, within a
period of thirty (30) days after the expiration of :he aforesaid ten (10) day
period, JFS (Delaware) and TM (Japan)/TM (USA) shall each name one arbitrator
16
<PAGE>
by written notice to the other Partners. The two arbitrators named as aforesaid
shall, within a period of twenty (20) days after the date the last of such
arbitrators has been named, select a third arbitrator who shall be an attorney
or retired judge and who shall serve as chairman. If JFS (Delaware) or TM
(Japan)/TM (USA) fails to name an arbitrator within the aforesaid ten (10) day
period, or if the two arbitrators named are unable to agree on the third
arbitrator, such arbitrator shall, at the request of any of the Partners, be
appointed by the American Arbitration Association.
9.5 Jurisdiction of the District Court. The Partners hereby submit to the
in personam Jurisdiction of the United States District Court for the Southern
District of New York, and agree that such Court may enter all such orders as may
be necessary or appropriate to enforce the provisions hereof and/or to confirm
any prearbitration ruling or decision or any award rendered by the panel of
arbitrators. The award rendered by the arbitrators shall be final, and judgment
may be entered upon it in accordance with applicable law in the United States
District Court for the Southern District of New York, or in any court having
jurisdiction thereof.
9.6 Costs and Expenses. Any costs or other expenses, including attorneys'
fees and costs incurred by the successful Partner, arising out of or occurring
because of the arbitration proceedings may be assessed against the unsuccessful
party, borne equally, or assessed in any other reasonable manner within the
discretion of the panel of arbitrators and shall be included as a part of any
award rendered by the arbitrators.
ARTICLE 10
10.1 Notices. All notices or other communications required or permitted to
be given pursuant to this Agreement shall be in writing and shall be considered
as properly given if hand delivered or if mailed from within the United States
by first class United States mail, postage prepaid, or by overnight carrier
guaranteeing next-day delivery, or, if from outside the United States, by
overnight carrier guaranteeing three-day delivery, or by facsimile transmission
(receipt confirmed) and addressed as follows:
If to TM (Japan): Tomen Corporation
Xokusai Shin Akasaka Bldg.
14-27 Akasaka 2 Chome, Minato-ku
Tokyo 107, Japan
Attention: Mr. K. Okui, General Manager
Space & Aircraft Department
Telecopy No. (03) 3588-7347/9965
If to TM (USA): Tomen America Inc.
1285 Avenue of the Americas
17
<PAGE>
New York, New York 10019
Attention: Mr. Hideo Funatsu,
Vice President, General Manager
Machinery-Electronics Dept.
Telecopy No.: (212) 541-7251
If to JFS (Delaware): Japan Fleet Service (Singapore) Pte.
Ltd.
10 Shenton Way, No. 17-06/09
Monetary Authority of Singapore
Building
Singapore 0207
Attention: Mr. Tim L. Watkins
Managing Director, President and
Chief Executive Officer
Telecopy No.: 011-65-2255583
In each case
with a copy to: Graham & James
885 Third Avenue
New York, New York 10022
Attention: William R. Campbell, Esq.
Telecopy No.: 212-688-2449
A Partner may change its address by giving notice in writing, stating its new
address, to the other Partner. Notice to a Partner given as provided above shall
be effective upon receipt by the Addressee named therein.
10.2 Law Governing. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
10.3 Amendments. This Agreement may not be amended or modified except by a
written instrument executed by all of the Partners.
10.4 Successors and Assigns. Subject to the provisions of Article 6 hereof,
this Agreement, and all the terms and provisions hereof, shall be binding upon
and shall inure to the benefit of the Partners, and their respective legal
representatives, successors and permitted assign=.
10.5 Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be considered an original but all of which shall constitute
one agreement.
10.6 Gender and Number. Whenever required by the context, as used in this
Agreement, the singular number shall include the plural, and the masculine
gender shall include the feminine or the neuter.
18
<PAGE>
10.7 Severability. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable, the remainder of this Agreement and the application
of such provision to other persons or circumstances shall not be affected
thereby, but rather shall be enforced to the greatest extent permitted by law.
10.8 Headings. The headings contained in this Agreement are for reference
purpose. only and shall not in any way affect the meaning or interpretation
thereof.
10.9 References. Any reference to an "Article" or to a "Section" contained
in this Agreement shall be to a provision of this Agreement, unless such
provision specifically provides otherwise.
10.10 Payment of Legal Fees. Except as otherwise provided herein, the
Partnership will pay all legal expenses incurred by the Partners and their
respective Affiliates in connection with the preparation and execution of this
Agreement and the matters related to the Purchase Agreements.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.
JAPAN FLEET SERVICE (DELAWARE) INC.
By: /s/ Tim L. Watkins
TM AVIATION (JAPAN) INC.
By: /s/ Kazutami Okui
TM AVIATION (USA) INC.
By: /s/ Hideo Funatsu
19
First Amendment
to
Partnership Agreement of J/T Aviation Partners
THIS FIRST AMENDMENT TO PARTNERSHIP AGREEMENT OF J/T AVIATION PARTNERS
(this "Amendment") is dated as of November 30, 1994, by and among Japan Fleet
Service (Delaware) Inc., a Delaware corporation ("JFS (Delaware)"), TM Aviation
(Japan) Inc., a Delaware corporation ("TM (Japan)"), and TM Aviation (USA) Inc.,
a Delaware corporation ("TM (USA)").
W I T N E S S E T H:
WHEREAS, pursuant to the Partnership Agreement of J/T Aviation Partners
dated as of February 14 , 1992 (the "Partnership Agreement"), JFS (Delaware), TM
(Japan) and TM (USA) formed J/T Aviation Partners, a Delaware general
partnership (the "Partnership"), in order to acquire a partnership interest in
AJT Capital Partners, a Delaware general partnership; and
WHEREAS, JFS (Delaware), TM (Japan) and TM (USA) now wish to amend the
Partnership Agreement to permit the Partnership to acquire (i) a 37.44% limited
partnership interest in ASC Acquisition Partners, L.P., a Delaware limited
partnership, (ii) a 48% general partnership interest in Aviation Properties, a
Delaware general partnership, (iii) a 48% general partnership interest in
Aviation Properties of Texas, a Delaware general partnership, and (iv) 360
shares of the common stock, $100 par value per share, of Aviation Sales
Management Company, a Delaware corporation;
NOW, THEREFORE, intending to be legally bound hereby, JFS (Delaware), TM
(Japan) and TM (USA) hereby agree as follows;
1. Definitions. (a) Except as otherwise provided herein, each capitalized
term used herein, but nor defined herein, shall have the meaning set forth in
the Partnership Agreement. The following capitalized terms shall have the
following meanings, and Section 1.1 of the Partnership Agreement is hereby
amended by inserting therein the following capitalized terms in the appropriate
alphabetical order:
"ASC Acquisition Capital Contribution" shall mean, with respect to
each Partner, a capital contribution to be made by such Partner to the
Partnership pursuant to Section 4.2 hereof in order to enable the
Partnership to acquire pursuant to Section 3.1 hereof (i) a 37.44% limited
partnership interest in ASC Acquisition Partners, the consideration for
which shall be $1,404,000, (ii) a
<PAGE>
48% general partnership interest in Aviation Properties, the consideration for
which shall be $480, (iii) a 48% general partnership interest in Aviation
Properties of Texas, the consideration for which shall be $480, and (iv) 360
shares of the common Stock, $100 par value per share, of Aviation Sales
Management Company, the consideration for which shall be $36,000.
"ASC Acquisition Closing Date" shall mean the "Closing Date," as such term
is defined in the ASC Acquisition Financing Agreement.
"ASC Acquisition Financing Agreement" shall mean that certain Credit
Agreement dated as of December 2, 1994, among (i) ASC Acquisition Partners, as
Borrower, (ii) the institutions from time to time party thereto, as Lenders,
(iii) the institutions from time to time party thereto, as Issuing Banks and
(iv) Citicorp Securities Inc., as Agent, as the same may be amended or otherwise
modified from time to time, and pursuant to which such Lenders and Issuing Banks
have agreed to provide to ASC Acquisition Partners certain financing that will
enable ASC Acquisition Partners to purchase certain assets from Aviall Services,
Inc.
"ASC Acquisition Partners" shall mean ASC Acquisition Partners, L.P., a
Delaware limited partnership.
"ASC Subordinated Junior Debt" shall mean the junior subordinated loans
totalling $7,000,000 to be obtained by ASC Acquisition Partners from Tomen
America Inc., Japan Fleet Service Co., Ltd. and RCP Management L.P. as of
December 2, 1994.
"Aviation Properties" shall mean Aviation Properties, a Delaware general
partnership.
"Aviation Properties of Texas" shall mean Aviation Properties of Texas, a
Delaware general partnership.
"Aviation Sales Management Company" shall mean Aviation Sales Management
Company, a Delaware corporation.
(b) The definition of the term "Partnership Assets" specified in Section
1.1 of the Partnership Agreement is hereby amended and restated in its entirety
to read as follows;
"Partnership Assets" means the real, personal and intangible property owned
by the Partnership from time to time, including, without limitation, its
interests in (i) AJT Capital Partners, (ii) ASC Acquisition
2
<PAGE>
Partners, (iii) Aviation Partners, (iv) Aviation Partners of Texas and (v)
Aviation Sales Management Company.
(c) The definitions of the terms "Ramco" and "Ramco Stock Option" are
hereby deleted from Section 1.1 of Partnership Agreement.
2. Amendments. (a) The first paragraph of preamble to the Partnership
Agreement is hereby amended and restated in its entirety to read as follows:
WHEREAS, the Partners desire to join together in the partnership
hereby to, among other things, acquire (i) a general partnership interest
in AJT Capital Partners, a Delaware general partnership ("AJT Capital
Partners"), the other partner of which shall be RCP Management L.P., a
Texas limited partnership, (ii) a limited partnership interest in ASC
Acquisition Partners, L.P., a Delaware limited partnership, the general
partner of which shall be Aviation Sales Management Company, a Delaware
corporation, and the other limited partners of which shall be AJT and AVAC
Corporation, a Delaware corporation ("AVAC"), (iii) a general partnership
interest in Aviation Properties, the other partner of which shall be AVAC,
(iv) a general partnership interest in Aviation Properties of Texas, the
other partner of which shall be AVAC, and (v) certain shares of the common
stock, $100 par value per share, of Aviation Sales Management Company, a
Delaware corporation; and
(b) Section 3.1 of the Partnership Agreement is hereby amended by amending
and restating clause (a) of the first sentence of Section 3.1 to read in its
entirety as follows:
(a) to acquire, own, hold for investment, sell or exchange (i) a 48%
general partnership interest in AJT Capital Partners, (ii) a 37,44% limited
partnership interest in ASC Acquisition Partners, (iii) a 48% general
partnership interest in Aviation Partners, (iv) a 48% general partnership
interest in Aviation Partners of Texas and (v) 360 shares of the common
stock, $100 par value per share, of Aviation Sales Management Company;
(c) Section 4.2 of the Partnership Agreement is hereby amended by inserting
the following words immediately before the period at the end thereof:
3
<PAGE>
; except that, subject to the satisfaction of each of the conditions
precedent set forth in Section 6.01 of the ASC Acquisition Financing
Agreement, not later than the ASC Acquisition Closing Date, at the written
request of the Administrative Partner, each Partner shall make its ASC
Acquisition Capital Contribution to the Partnership The amount of each
Partner's ASC Acquisition Capital Contribution shall equal the dollar
amount arrived at by multiplying (a) $1,440,960 by (b) the Percentage
Ownership Interest of such Partner set forth in Section 4.1.
(d) Section 5.4 of the Partnership Agreement is hereby amended by, in the
seventh line thereof, substituting the name "Takashi Yoshida" for the name
"Hideo Funatsu".
(e) Section 5.11 of the Partnership Agreement is hereby deleted in its
entirety and shall be of no further force or effect.
(f) The introductory paragraph of Section 8.1 of the Partnership Agreement
is hereby amended and restated in its entirety to read as follows:
8.1 Dissolution and Termination of the Partnership or a Partner. The
Partnership shall continue until, and shall automatically dissolve on, the
last to occur of:
(a) the date on which the final distribution of AJT Capital Partners shall
be made;
(b) the date on which the final distribution of ASC Acquisition Partners
shall be made;
(c) the date upon which the final distribution of Aviation Properties
shall be made; or
(d) the date upon which the final distribution of Aviation Properties of
Texas shall be made; or
(e) the date on which the final distribution of Aviation Sales Management
Company shall be made; or
(f) the payment in full of all amounts owing by ASC Acquisition Partners
under (i) the ASC Acquisition Financing Agreement and (ii) the ASC
Junior Subordinated Debt;
unless sooner dissolved upon the earliest to occur of any of the following
events, any of which shall cause an immediate dissolution of the
Partnership:
4
<PAGE>
(g) The Partnership Agreement is hereby amended by adding the following
text to the end of Article 5 as Section 5 .12:
5.12 Resignation of Administrative Partner. The Administrative
Partner may resign at any time by giving notice thereof to the other
Partners. Within 30 days of the date on which the Administrative
Partner shall have given notice of its resignation pursuant to the
preceding sentence of this Section 5.12, the Partners shall elect a
successor Administrative Partner. Upon its election as successor
Administrative Partner hereunder, such successor Administrative
Partner shall immediately succeed to and become vested with all of the
rights, powers, privileges and duties of the resigning Administrative
Partner, and the resigning Administrative Partner shall be discharged
from its duties and obligations hereunder. If no successor
Administrative Partner shall have been elected by the Partners within
such thirty-day period, each action described in Section 5.1(b) as an
action that may be taken on behalf of the Partnership by the
Administrative Partner may only be taken by the Partnership, or by any
Partner on behalf of the Partnership, in each case, with the consent
of all of the Partners.
(h) Section 10.1 of the Partnership Agreement is hereby amended by (i)
substituting the name "Takashi Yoshida" for the name "Hideo Funatsu" wherever it
appears therein and (ii) substituting the following for the information relating
to Graham & James appearing therein:
Orrick, Herrington & Sutcliffe
599 Lexington Avenue, 29th Floor
New York, New York 10022
Attention: William R. Campbell, Esq.
Telecopy: (212) 326-8900
3. Governing Law. This Amendment, and the Partnership Agreement as amended
by this Amendment, shall be governed by and interpreted in accordance with the
laws of the State of Delaware.
5
<PAGE>
4. CounterParts: Effective Date. This Amendment may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the Partners have caused this Amendment to be duly
executed by their duly authorized officers as of the day and year first written
above.
JAPAN FLEET SERVICE (DELAWARE) INC.
By: /s/ Tim L. Watkins
-----------------------------------------
Name: Tim L. Watkins
Title: President
TM AVIATION (JAPAN) INC.
By: /s/ Kazuhiko Maeda
-----------------------------------------
Name: Kazuhiko Maeda
Title: Asst. Vice President
TM AVIATION (USA) INC.
By: /s/ Kazuhiko Maeda
-----------------------------------------
Name: Kazuhiko Maeda
Title: Vice President
6
EXCHANGE AGREEMENT
(Limited Partner Partnership Interests in ASC Acquisition Partners, L.P.)
This EXCHANGE AGREEMENT (the "Agreement") is entered into and effective as
of the 26th day of June, 1996 (the "Effective Date"), by and among AVIATION
SALES COMPANY, a Delaware corporation ("ASC"); and the limited partners of ASC
ACQUISITION PARTNERS, L.P., a Delaware limited partnership (the "Partnership"),
who are more particularly identified on the signature pages attached hereto
(individually, a "Limited Partner," and collectively, the "Limited Partners").
W I T N E S S E T H:
WHEREAS, the Limited Partners are the owners of all of the limited partner
partnership interests in and to the Partnership (individually, a "Partnership
Interest," and collectively, the "Partnership Interests"), which Partnership
Interests are owned by the Limited Partners as set forth on Exhibit "A" attached
hereto;
WHEREAS, ASC has been formed as a Delaware corporation and contemplates an
initial public offering of its equity securities pursuant to the terms of a
Registration Statement on Form S-1 filed by ASC on April 15, 1996, with the
Securities and Exchange Commission, as amended from time to time (the "IPO"):
WHEREAS, as part of the organization of ASC and the overall plan of the
IPO, ASC desires to obtain from the Limited Partners, and the Limited Partners
desire to contribute to ASC, the Partnership Interests;
WHEREAS, in exchange for the contribution of the Partnership Interests, ASC
is willing to issue to the Limited Partners, and the Limited Partners are
willing to accept from ASC, certain shares of common stock of ASC. par value
$.001 per share (the "Common Stock"), and, with respect to J/T Aviation
Partners, certain additional consideration more particularly described herein;
WHEREAS, ASC and the Limited Partners desire to effect the exchange of the
Partnership Interests and Common Stock upon the terms and conditions set forth
in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements set forth herein, the parties hereto, intending to be legally bound,
hereby agree as follows:
Section 1. Agreement to Exchange.
(a) Subject to the terms and conditions of this Agreement, each of the
Limited Partners, other than J/T Aviation Partners, agrees to contribute to ASC
its respective Partnership Interest solely in exchange for the Common Stock set
forth on Exhibit "A" opposite his name.
<PAGE>
(b) Subject to the terms and conditions of this Agreement, J/T Aviation
Partners agrees to contribute to ASC its Partnership Interest in exchange for
all of the following:
(i) 973,000 shares of Common Stock.
(ii) A promissory note executed by ASC dated as of the Closing Date
(as hereinafter defined), payable to J/T Aviation Partners (the "J/T
Note"), in the original principal amount equal to the proceeds anticipated
to be received by ASC from the underwriters for 500,000 of the shares of
Common Stock being sold by ASC pursuant to the IPO (net of commissions and
underwriter discounts). The J/T Note shall provide (A) that the outstanding
principal balance of the J/T Note shall be due and payable in full upon the
receipt by ASC of the proceeds to be received by ASC from the underwriters
for the sale of shares of Common Stock being sold by ASC pursuant to the
IPO, and (B) that if ASC does not proceed with the IPO and the principal
balance of the J/T Note is not paid in full in cash on or before July 5,
1996, then ASC shall rescind the J/T Note, and J/T Aviation Partners shall
deliver the cancelled J/T Note to ASC. The J/T Note shall be in the form
attached hereto as Exhibit "B".
(iii) A contingent stock agreement executed by ASC and J/T Aviation
Partners (the "Contingent Stock Agreement"), providing for the issuance of
five hundred seventy-five thousand (575,000) shares of Common Stock as part
of the exchange transaction, as and to the extent provided in the
Contingent Stock Agreement. The Contingent Stock Agreement shall be in the
form attached hereto as Exhibit "C".
(iv) If and only if ASC proceeds with the IPO and the J/T Note is paid
in cash within thirty (30) days, an additional amount equal to 15.38% of
the proceeds received by ASC from the underwriters for any shares of Common
Stock purchased pursuant to the exercise of the underwriters'
over-allotment option relating to the IPO (net of commissions and
underwriter discounts), and/or, to the extent such option is not exercised
in full, 15.38% of such portion of the 487,500 shares of Common Stock
subject to such option (up to 75,000 shares) which is not purchased by the
underwriters pursuant to the IPO.
(c) Subject to the terms and conditions of this Agreement, ASC agrees to
deliver to the Limited Partners, other than J/T Aviation Partners, in exchange
for the Partnership Interests owned by such Limited Partners, the number of
Common Stock set forth on Exhibit "A" opposite the respective names of such
Limited Partners, and ASC agrees to deliver to J/T Aviation Partners, in
exchange for the Partnership Interest owned by J/T Aviation Partners, the number
of Common Stock set forth on Exhibit "A", the J/T Note, the Contingent Stock
Agreement and the additional consideration described in Section l(b)(iv), if
any.
(d) Each of the Limited Partners acknowledges and agrees that ASC shall
have the right, exercisable at any time prior to the Closing (hereinafter
defined), to instruct such Limited Partner to contribute the Partnership
Interest owned by such Limited Partner directly to Aviation
-2-
<PAGE>
Sales Operating Company, a Delaware corporation and wholly-owned subsidiary of
ASC ("ASOC"), in lieu of contributing such Partnership Interest to ASC.
Section 2. Closing.
(a) The closing of the transactions provided for herein (the "Closing")
shall take place simultaneously with the execution of this Agreement (the
"Closing Date"), which is one (1) business day prior to the proposed effective
date of the IPO.
(b) At the Closing, each of the Limited Partners shall deliver to ASC a
duly executed assignment of limited partnership interest contributing all of the
Partnership Interest owned by such Limited Partner to ASC (or, if ASC so elects
in accordance with Section 1(d), to ASOC).
(c) At the Closing, ASC shall deliver to each of the Limited Partners the
certificate(s) representing the Common Stock to be issued to such Limited
Partner (collectively, the "ASC Certificates"). Further, ASC shall execute and
deliver to J/T Aviation Partners the J/T Note and the Contingent Stock
Agreement.
(d) After the Closing, ASC shall, if applicable, deliver to J/T Aviation
Partners, (i) within one (1) business day after the receipt thereof by ASC, an
amount equal to 15.38% of the proceeds received by ASC from the underwriters for
any shares of Common Stock purchased pursuant to the exercise of the
underwriters' over-allotment option, and (ii) within three (3) business days
after the expiration of the period for the exercise of the over-allotment option
is ASC proceeds with the IPO, to the extent such option is not exercised in
full, an amount of shares of Common Stock equal to 15.38% of such portion of the
487,500 shares of Common Stock subject to such option (up to 75,000 shares)
which is not purchased by the underwriters.
Section 3. Representations and Warranties of the Limited Partners. Each of
the Limited Partners represents and warrants to ASC as follows:
(a) Such Limited Partner has all power and authority necessary to execute
and deliver this Agreement and perform its or his obligations hereunder; the
execution, delivery and performance of this Agreement by such Limited Partner
will not conflict with, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the Partnership Interest to be contributed by
such Limited Partner pursuant to the terms of, or constitute a default under,
any agreement, will or instrument, or any order, rule or regulation of any court
or governmental agency having jurisdiction over such Limited Partner or its or
his property; no consent, authorization or order of, or filing or registration
with, any court or governmental agency is required for the execution, delivery
and performance of this Agreement by such Limited Partner.
(b) Such Limited Partner, if not a Management Team Limited Partner (as such
term is defined in Section 3(c)), will have, as of the Closing Date, good title
to the Partnership Interest to be contributed by such Limited Partner free and
clear of any liens, claims, preemptive rights and any other encumbrances
attributable to the assignor; and upon delivery of and
-3-
<PAGE>
payment for such shares as contemplated herein, ASC or ASOC, as the case may be,
will receive good title to the Partnership Interest contributed to it by such
Limited Partner, free and clear of any liens, claims, preemptive rights and any
other encumbrances attributable to the assignor, other than the Permitted Liens.
For purposes of this Section 3(b), Permitted Liens" shall mean:
(i) the security interests granted in connection with the loans and
credit facilities extended to the Partnership under that certain Credit
Agreement dated as of December 2, 1994 (the "Credit Agreement"), executed
by and among the Partnership, Citicorp Securities, Inc., in its capacity as
arranger and agent for the lenders and the issuing banks thereunder, and
the various lenders and issuing banks joining therein; which security
interests will be released upon the consummation of the transactions made
the subject of this Agreement.
(c) Such Limited Partner, if either Dale S. Baker, Harold M. Woody, Joseph
E. Civiletto, James D. Innella or Michael Saso (individually, a "Management Team
Limited Partner," and collectively, the "Management Team Limited Partners"),
will have, as of the Closing Date, good title to the Partnership Interest to be
contributed by such Limited Partner free and clear of any liens, claims,
preemptive rights and any other encumbrances attributable to the assignor, other
than the Management Team Permitted Liens; and upon delivery of and payment for
such shares as contemplated herein, ASC or ASOC, as the case may be, will
receive good title to the Partnership Interest contributed to it by such Limited
Partner, free and clear of any liens, claims, preemptive rights and any other
encumbrances attributable to the assignor, other than the Management Team
Permitted Liens. For purposes of this Section 3(c), "Management Team Permitted
Liens" shall mean:
(i) the security interests granted in connection with the loans and
credit facilities extended to the Partnership under the Credit Agreement;
which security interests will be released upon the consummation of the
transactions made the subject of this Agreement; and
(ii) the security interests granted in connection with the loans
extended to each Management Team Limited Partner by AVAC Corporation and
J/T Aviation Partners (collectively, the "Selling Partners"), in connection
with such Management Team Limited Partner's acquisition of his Partnership
Interest from the Selling Partners; which security interests will continue
after the consummation of the transactions made the subject of this
Agreement but which will attach only to the Common Stock received by such
Management Team Limited Partner pursuant to the terms of this Agreement.
Section 4. Representations and Warranties of ASC. ASC represents and
warrants to each of the Limited Partners that (a) ASC has all power and
authority necessary to execute and deliver this Agreement and perform its
obligations hereunder; (b) the execution, delivery and performance of this
Agreement by ASC will not conflict with, or result in the creation or imposition
of any lien, charge or encumbrance upon any of the Common Stock to be issued by
-4-
<PAGE>
ASC pursuant to the terms of, or constitute a default under any agreement or
instrument, or any order, rule or regulation of any court or governmental agency
having jurisdiction over ASC or its property; and (c) no consent, authorization
or order of, or filing or registration with, any court or governmental agency is
required for the execution, delivery and performance of this Agreement by ASC.
Section 5. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
given if sent by registered or certified mail, first class postage prepaid,
return receipt requested, to the address of such parties set forth on the
signature pages of this Agreement or such other future address as may be
specified by any party by notice to all of the other parties. Such
communications may also be given by personal delivery, by facsimile or by
regular mail, but shall be effective only if and when actually received.
Section 6. Amendment. This Agreement may not be modified, amended, altered
or supplemented except upon execution and delivery of a written agreement
executed by the parties hereto.
Section 7. Survival of Representations, Warranties and Covenants. ASC and
each of the Limited Partners agree that their respective representations,
warranties and covenants contained in this Agreement shall survive the Closing
Date and any investigation made by the parties with respect thereto.
Section 8. Miscellaneous.
(a) The provisions hereof shall be binding upon and inure to the benefit of
the parties and their respective heirs, personal representatives, successors and
permitted assigns.
(b) This Agreement may not be assigned without the prior written consent of
the parties hereto.
(c) This Agreement and the additional documents referenced herein merge all
prior negotiations and agreements between the parties relating to the subject
matter hereof and constitute the entire agreement between the parties relating
to such subject matter. No prior or contemporaneous agreements, except as
specified herein, written or oral, relating to such subject matter shall be
binding.
(d) Each party hereto specifically covenants and agrees that it will
execute such other and further instruments and documents as are or may become
necessary or convenient to effectuate and carry out the provisions of this
Agreement.
(e) This Agreement may be executed simultaneously in multiple counterparts,
all of which together shall constitute one and the same instrument.
-5-
<PAGE>
(f) This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
- 6 -
<PAGE>
IN WITNESS WHEREOF, ASC and the Limited Partners have executed this
Agreement effective as of the Effective Date.
ASC:
AVIATION SALES COMPANY, a Delaware corporation
By: /s/ Dale S. Baker
------------------------------------------
Dale S. Baker, President
Address for Notice:
-------------------
6905 N.W. 25th St.
Miami, Florida 33122
Telecopy: (305) 599-6610
LIMITED PARTNERS:
AVAC CORPORATION, a Delaware corporation
By: /s/ Robert Alpert
------------------------------------------
Robert Alpert, President
Address for Notice:
-------------------
15311 Vantage Parkway West, Suite 315
Houston, Texas 77032
Telecopy: (713) 442-0025
Signature Page to Exchange Agreement
(Limited Partner Partnership Interests in ASC Acquisition Partners, L.P.)
-7-
<PAGE>
J/T AVIATION PARTNERS, a Delaware general
partnership
By: Japan Fleet Service (Delaware) Inc. a
Delaware corporation, General Partner
By: /s/ Tim L. Watkins
--------------------------------------
Tim L. Watkins. President
By: TM Aviation (Japan) Inc., a Delaware
corporation. General Partner
By: /s/ K. Okut
--------------------------------------
Name: K. Okut
------------------------------------
Title: President
-----------------------------------
By: TM Aviation (USA) Inc., a Delaware
corporation, General Partner
By: /s/ T. Yoshida
--------------------------------------
Name: T. Yoshida
------------------------------------
Title: President
-----------------------------------
Address for Notice:
-------------------
c/o Tomen America, Inc.
1285 Avenue of the Americas
New York, New York 10019
Telecopy: (212) 397-3351
Signature Page to Exchange Agreement
(Limited Partner Partnership Interests in ASC Acquisition Partners, L.P.)
-8-
<PAGE>
AJT CAPITAL PARTNERS, a Delaware general
partnership d/b/a Aerospace International
Services
By: RCP Management L.P., a Texas limited
partnership, Managing Partner
By: Aircraft Spare Parts, Inc., a Delaware
corporation, General Partner
By: /s/ Robert Alpert
----------------------------------
Robert Alpert, Chairman
Address for Notice:
-------------------
15311 Vantage Parkway West, Suite 315
Houston, Texas 77032
Telecopy: (713) 442-0025
/s/ Dale S. Baker
----------------------------------------------
DALE S. BAKER
Address for Notice:
-------------------
545 Coconut Circle
Palm Island
Ft. Lauderdale, FL 33326
Telecopy: (305) 599-6610
Signature Page to Exchange Agreement
(Limited Partner Partnership Interests in ASC Acquisition Partners, L.P.)
-9-
<PAGE>
/s/ Harold M. Woody
----------------------------------------------
HAROLD M. WOODY
Address for Notice:
-------------------
10855 S.W. 75 Court
Miami, Florida 33156
Telecopy: (305) 599-6610
/s/ Joseph E. Civiletto
----------------------------------------------
JOSEPH E. CIVILETTO
Address for Notice:
-------------------
1070 Pine Branch Drive
Ft. Lauderdale, FL 33326
Telecopy: (305) 599-6610
/s/ James D. Innella
----------------------------------------------
JAMES D. INNELLA
Address for Notice:
-------------------
11946 South West 44th Street
Davie, FL 33330
Telecopy: (305) 599-5610
/s/ Michael Saso
----------------------------------------------
MICHAEL SASO
Address for Notice:
-------------------
11812 Poema Place
Chatsworth, CA 91311
Telecopy: (818) 895-6888
Signature Page to Exchange Agreement
(Limited Partner Partnership Interests in ASC Acquisition Partners, L.P.)
-10-
<PAGE>
EXHIBIT "A"
ASC ACQUISITION PARTNERS, L.P.
ROSTER OF LIMITED PARTNERS
Limited Partnership Number of ASC
Partner Interest Shares to be Issued
AVAC Corporation 33.54% 1,677,000
J/T Aviation Partners 30.96% 973,000*
AJT Capital Partners 20.00% 1,000,000
Dale S. Baker 6.00% 300,000
Harold Woody 4.00% 200,000
James D. Innella 1.50% 75,000
Michael Saso 1.50% 75,000
Joseph E. Civiletto .50% 25,000
----- ---------
TOTAL 98.00% 4,325,000*
Note: In addition, J/T Aviation Partners will be receiving the additional
consideration described in Sections 1(b)(ii), (iii) and (iv) of the
Agreement.
<PAGE>
EXHIBIT "B"
PROMISSORY NOTE
(Payable to J/T Aviation Partners)
US $8,835,000.00 Dated: June 26, 1996
FOR VALUE RECEIVED, the undersigned, AVIATION SALES COMPANY, a Delaware
corporation ("Borrower"), hereby promises to pay to the order of J/T AVIATION
PARTNERS, a Delaware general partnership ("Lender"), the principal sum of EIGHT
MILLION EIGHT HUNDRED THIRTY-FIVE THOUSAND AND NO/100 DOLLARS (US
$8,835,000.00), on July 5, 1996 (the "Maturity Date"), subject to the terms and
conditions herein.
No interest shall accrue on this Note.
The principal of this Note shall be payable in lawful money of the United
States of America in immediately available funds without set-off or
counterclaim, without penalty or premium, free and clear of, and without
deduction for, any taxes, restrictions or conditions of any nature
Borrower may prepay this Note in whole or in part at any time.
Whenever any payment hereunder or under this Note shall be stated to be due
on a day that is not a Banking Day, such payment shall be made on the next
succeeding Banking Day, and such extension of time shall in such case be
included in the computation of payment of interest accruing hereunder.
This Note is issued pursuant to and is further governed by the terms and
provisions of that certain Exchange Agreement of even date herewith (the
"Exchange Agreement"), executed by and among Borrower and the limited partners
of ASC Acquisition Partners, L.P., a Delaware limited partnership (the
"Partnership"), and represents a part of the consideration being delivered by
Borrower to Lender in exchange for the contribution by Lender to Borrower, or
Borrower's designee, of a limited partnership interest in the Partnership, all
as more particularly described in the Exchange Agreement. Notwithstanding any
provision in this Note to the contrary, (a) the outstanding principal balance of
this Note shall be due and payable in full upon the receipt by Borrower of the
proceeds to be received by Borrower from the underwriters for the sale of shares
of common stock, $.001 par value, of Borrower being sold by Borrower pursuant to
the IPO (as such term is defined in the Exchange Agreement), and (b) if and only
if Borrower does not proceed with the IPO and this Note is not paid in full in
cash on or before the Maturity Date, then Borrower may rescind this Note, and
this Note shall be cancelled by Lender and delivered by Lender to Borrower.
This Note shall be governed by and construed in accordance with the laws of
the State of New York.
<PAGE>
This Note may not be assigned. pledged or transferred by Lender, and any
attempt to do so shall be null and void.
Borrower and Lender acknowledge that this Note is a general obligation of
Borrower (subject to the terms and conditions herein) and is not secured or
guaranteed by any person.
When used herein, each of the following capitalized terms shall have the
meanings specified below:
"Banking Day" shall mean any day that is not a Saturday or Sunday and on
which banks are not required or permitted by law to close in New York City.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
-2-
<PAGE>
IN WITNESS WHEREOF, Borrower has caused this Note to be executed as of the
date written above.
AVIATION SALES COMPANY,
a Delaware corporation
By:
------------------------------------------
Dale S. Baker, President
Signature Page to Promissory Note
(Payable to J/T Aviation Partners)
-3-
<PAGE>
EXHIBIT "C"
CONTINGENT STOCK AGREEMENT
(J/T Aviation Partners)
This CONTINGENT STOCK AGREEMENT (the "Agreement") is entered into and
effective as of the _____ day of June, 1996 (the "Effective Date"), by and
between AVIATION SALES COMPANY, a Delaware corporation ("ASC"), and J/T AVIATION
PARTNERS, a Delaware general partnership "J/T").
WITNESSETH:
WHEREAS, ASC has been formed as a Delaware corporation and contemplates an
initial public offering of its equity securities pursuant to the terms of a
Registration Statement on Form S-1 filed by ASC on April 15, 1996, with the
Securities and Exchange Commission, as amended from time to time (the "IPO");
WHEREAS, ASC and the limited partners of ASC ACQUISITION PARTNERS, L.P., a
Delaware limited partnership (the "Partnership"), have entered into that certain
Exchange Agreement of even date herewith (the "Exchange Agreement"):
WHEREAS, ASC and J/T have entered into this Agreement in connection with
the exchange described in the Exchange Agreement and with a view to complying
with the requirements of Revenue Procedure 77-37, as amplified by Revenue
Procedure 84-52;
NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements set forth herein, the parties hereto, intending to be legally bound,
hereby agree as follows:
Section 1. Capitalized terms used in this Agreement and not otherwise
defined shall have the meaning given them in the Exchange Agreement.
Section 2. ASC hereby agrees to deliver to J/T five hundred seventy-five
thousand (575,000) shares (the "Contingent Shares") of common stock, $.001 par
value, of ASC in connection with the exchange transaction contemplated by the
Exchange Agreement, provided however that such delivery shall be conditioned
upon the nonoccurrence of the IPO (such nonoccurrence, the "Contingency"),
provided further that ASC and J/T acknowledge that the Contingency is not within
the control of the shareholders of ASC, and ASC shall use its best efforts
towards avoiding the Contingency.
Section 3. The Contingent Shares shall be issued five (5) business days
after the Closing Date if the Contingency has come to pass.
Section 4. The parties acknowledge that the Contingent Shares were not
issued as of the Closing Date due to uncertainty as to whether the IPO would
occur.
<PAGE>
Section 5. The number of Contingent Shares shall be no more nor less than
five hundred seventy-five thousand (575,000).
Section 6. The parties acknowledge that at least fifty percent (50%) of the
maximum number of shares of each class of stock which may be issued by ASC in
connection with the formation of ASC is issued in the exchange described in the
Exchange Agreement.
Section 7. The benefits and obligations of this Agreement may not be
assigned, transferred or assumed by J/T (other than by operation of law), and
any such assignment, transfer or assumption shall be null and void.
Section 8. The rights of J/T under this Agreement are limited to rights in
respect of the possible receipt of the Contingent Shares as provided in Section
2 of this Agreement.
Section 9. The parties acknowledge that any issuance of Contingent Shares
shall not be triggered by the payment of additional tax or reduction in tax paid
as a result of an audit of the shareholders of ASC.
Section 10. Miscellaneous.
(a) The provisions hereof shall be binding upon and inure to the benefit of
the parties and their respective heirs, personal representatives, successors and
permitted assigns (subject to Section 7).
(c) This Agreement and the additional documents referenced herein merge all
prior negotiations and agreements between the parties relating to the subject
matter hereof and constitute the entire agreement between the parties relating
to such subject maker. No prior or contemporaneous agreements, except as
specified herein, written or oral, relating to such subject matter shall be
binding.
(d) Each party hereto specifically covenants and agrees that it will
execute such other and further instruments and documents as are or may become
necessary or convenient to effectuate and carry out the provisions of this
Agreement.
(e) This Agreement may be executed simultaneously in multiple counterparts,
all of which together shall constitute one and the same instrument.
(f) This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
-2-
<PAGE>
IN WITNESS WHEREOF, ASC and J/T have executed this Agreement effective as
of the Effective Date.
ASC:
AVIATION SALES COMPANY, a Delaware corporation
----------------------------------------------
Dale S. Baker, President
Address for Notice:
-------------------
6905 N.W. 25th St.
Miami, Florida 33122
Telecopy: (305) 599-6610
J/T:
J/T AVIATION PARTNERS, a Delaware general
partnership
By: Japan Fleet Service (Delaware) Inc., a
Delaware corporation, General Partner
By:
---------------------------------------
Tim L. Watkins, President
By: TM Aviation (Japan) Inc., a Delaware
corporation, General Partner
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Signature Page to Contingent Stock Agreement
(J/T Aviation Partners)
-3-
<PAGE>
By: TM Aviation (USA) Inc., a Delaware
corporation, General Partner
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Address for Notice:
-------------------
c/o Tomen America, Inc.
1285 Avenue of the Americas
New York, New York 10019
Telecopy: (212) 397-3351
Signature Page to Contingent Stock Agreement
(J/T Aviation Partners)
-4-
AGREEMENT OF MERGER
This AGREEMENT OF MERGER (the "Agreement"), is dated this 24th day of June,
1996, pursuant to Section 251 of the General Corporation Law of Delaware, by and
among AVIATION SALES MANAGEMENT COMPANY, a Delaware corporation, AVIATION SALES
COMPANY, a Delaware corporation, and AVIATION SALES OPERATING COMPANY, a
Delaware corporation.
W I T N E S S E T H:
WHEREAS, Aviation Sales Operating Company is a wholly owned subsidiary of
Aviation Sales Company; and
WHEREAS, the parties hereto desire to merge Aviation Sales Management
Company and Aviation Sales Operating Company into a single corporation, as
hereinafter specified; and
WHEREAS, the registered office of said Aviation Sales Management Company in
the State of Delaware is located at Corporation Trust Center, 1209 Orange
Street, in the City of Wilmington, County of New Castle, and the name of its
registered agent at such address is The Corporation Trust Center, and the
registered office of said Aviation Sales Operating Company in the State of
Delaware is located at Corporation Trust Center, 1209 Orange Street, in the City
of Wilmington, County of New Castle, and the name of its registered agent at
such address is The Corporation Trust Center.
NOW, THEREFORE, the parties to this Agreement, in consideration of the
mutual covenants, agreements and provisions hereinafter contained, do hereby
prescribe the terms and conditions of said merger and mode of carrying the same
into effect as follows:
-1-
<PAGE>
FIRST: Aviation Sales Management Company and Aviation Sales Operating
Company shall be and hereby are merged into a single corporation, in accordance
with the applicable provisions of the laws of the State of Delaware, by merging
Aviation Sales Management Company, into Aviation Sales Operating Company, which
shall be the corporation surviving this merger.
SECOND: The manner of converting the outstanding shares of the capital
stock of Aviation Sales Management Company into the shares or other securities
of Aviation Sales Company shall be as follows:
(a) Each share of common stock of Aviation Sales Operating Company
which shall be issued and outstanding on the effective date of this merger,
and all rights in respect thereof, shall remain unchanged and shall
continue to be an issued and outstanding share of common Stock; of the
corporation surviving this merger.
(b) Each share of common stock of Aviation Sales Management Company
which shall be issued and outstanding on the effective date of this
merger, and all rights in respect thereof, shall forthwith be changed and
converted into a total of one hundred thirty-three and one-third (133 and
1/3rd) shares of common stock of Aviation Sales Company.
(c) After the effective date of this merger, each holder of an
outstanding certificate representing shares of common stock of Aviation
Sales Management Company shall surrender the same to Aviation Sales Company
for conversion and each such holder shall be entitled upon such surrender
to receive the number of shares of common stock of Aviation Sales Company
on the basis provided herein. Until so surrendered, the outstanding shares
of the stock of Aviation Sales Management Company to be converted into the
stock of Aviation Sales Company as provided herein, may be treated by
Aviation Sales Company for all corporate purposes as evidencing the
ownership of shares of Aviation Sales Company as though said surrender and
conversion had taken place. After the effective date of this Agreement,
each registered owner of any uncertificated shares of common stock of
Aviation Sales Management Company shall have said shares cancelled and said
registered owner shall be entitled to the number of common shares of
Aviation Sales Company on the basis provided herein.
THIRD: The terms and conditions of the merger are as follows:
-2-
<PAGE>
(a) The bylaws of Aviation Sales Operating Company as they shall exist
on the effective date of this merger shall be and remain the bylaws of
Aviation Sales Operating Company until the same shall be altered, amended
or repealed as therein provided.
(b) The directors and officers of Aviation Sales Operating Company
shall continue in office until the next annual meeting of stockholders and
until their successors shall have been elected and qualified
(c) This merger shall become effective as of the close of business on
June 26, 1996.
(d) Upon the merger becoming effective, all the property, rights,
privileges, franchises, patents, trademarks, licenses, registrations and
other assets of every kind and description of Aviation Sales Management
Company shall be transferred to, vested in and devolve upon Aviation Sales
Operating Company without further act or deed and all property, rights and
every other interest of Aviation Sales Management Company and Aviation
Sales Operating Company shall be as effectively the property of Aviation
Sales Operating Company as they were of Aviation Sales Management Company
and Aviation Sales Operating Company, respectively. Aviation Sales
Management Company hereby agrees from time to time, as and when requested
by Aviation Sales Operating Company or by its successors or assigns, to
execute and deliver or cause to be executed and delivered all such deeds
and instruments and to take or cause to be taken such further or other
action as Aviation Sales Operating Company may deem necessary or desirable
in order to vest in and confirm to Aviation Sales Operating Company title
to and possession of any property of Aviation Sales Management Company
acquired or to be acquired by reason of or as a result of the merger herein
provided for and otherwise to carry out the intent and purposes hereof and
the proper officers and directors of Aviation Sales Management Company and
the other officers and directors of Aviation Sales Operating Company are
fully authorized in the name of Aviation Sales Management Company or
otherwise to take any and all such action.
FOURTH: Anything herein or elsewhere to the contrary notwithstanding, this
Agreement may be terminated and abandoned by the Board of Directors of any
constituent corporation at any time prior to the date of filing the merger with
the Secretary of State. This Agreement may be amended by the Board of Directors
of the constituent corporations at any time prior to the date of filing the
merger with the Secretary of State, provided that an amendment made subsequent
to the adoption of this Agreement by the stockholders of any
-3-
<PAGE>
constituent corporation shall not (1) alter or change the amount or kind of
shares, securities, cash, property and/or rights to be received in exchange for
or on conversion of all or any of the shares of any class or series thereof of
such constituent corporation, (2) alter or change any term of the Certificate of
Incorporation of Aviation Sales Operating Company to be effected by the merger,
or (3) alter or change any of the terms and conditions of this Agreement if such
alteration or change would adversely affect the holders of any class or series
thereof of such constituent corporation.
[THIS PAGE INTENTIONALLY LEFT BLANK]
-4-
<PAGE>
IN WITNESS WHEREOF, the parties to this Agreement, pursuant to the approval
and authority duly given by resolutions adopted by their respective Board of
Directors and that fact having been certified on said Agreement of Merger by the
Secretary of each corporate party thereto, have caused these presents to be
executed by the President of each party hereto as the respective act, deed and
agreement of each said corporation, on this 24th day of June, 1996.
AVIATION SALES MANAGEMENT
COMPANY
By: /s/ James D. Innella
---------------------------------
James D. Innella, Vice President and Chief
Operating Officer
AVIATION SALES COMPANY
By: /s/ James D. Innella
---------------------------------
James D. Innella, Vice President and Chief
Operating Officer
AVIATION SALES OPERATING
COMPANY
By: /s/ James D. Innella
---------------------------------
James D. Innella, Vice President and Chief
Operating Officer
Signature Page to Agreement of Merger
-5-
<PAGE>
I, Denise Jacocks, Secretary (or Assistant Secretary) of Aviation Sales
Management Company, a corporation organized and existing under the laws of the
State of Delaware, hereby certify, as such Secretary (or Assistant Secretary),
that the Agreement of Merger to which this Certificate is attached, after having
been first duly signed on behalf of the said corporation and having been signed
on behalf of Aviation Sales Operating Company and Aviation Sales Company, both
corporations of the State of Delaware, was duly adopted pursuant to section 228
of the General Corporation Law of Delaware by the unanimously written consent of
the stockholders of said Aviation Sales Management Company, and is thereby the
duly adopted agreement and act of the said corporation.
WITNESS my hand on this 24th day of June, 1996.
/s/ Denise Jacocks
----------------------------
Assistant Secretary
Signature Page to Agreement of Merger
-6-
<PAGE>
I, Denise Jacocks, Secretary (or Assistant Secretary) of Aviation Sales
Company, a corporation organized and existing under the laws of the State of
Delaware, hereby certify, as such Secretary (or Assistant Secretary), that the
Agreement of Merger to which this Certificate is attached, after having been
first duly signed on behalf of the said corporation and having been signed on
behalf of Aviation Sales Operating Company and Aviation Sales Management
Company, both corporations of the State of Delaware, was duly adopted by
unanimous written consent of the Board of Directors of Aviation Sales Company
and, pursuant to subsection (f) of section 251 of the General Corporation Law of
Delaware without any vote of the stockholders of said Aviation Sales Company
inasmuch as no shares of the Stock of such corporation have been issued prior to
the adoption by the Board of Directors of the resolution approving the Agreement
of Merger, and is thereby the duly adopted agreement and act of the said
corporation.
WITNESS my hand on this 24th day of June, 1996.
/s/ Denise Jacocks
----------------------------
Assistant Secretary
Signature Page to Agreement of Merger
-7-
<PAGE>
I, Denise Jacocks, Secretary (or Assistant Secretary) of Aviation Sales
Operating Company, a corporation organized and existing under the laws of the
State of Delaware, hereby certify, as such Secretary, (or Assistant Secretary),
that the Agreement of Merger to which this Certificate is attached, after having
been first duly signed on behalf of the said corporation and having been signed
on behalf of Aviation Sales Company and Aviation Sales Management Company, both
corporations of the State of Delaware, was duly adopted pursuant to section 228
of the General Corporation Law of Delaware by the unanimous written consent of
the stockholders of said Aviation Sales Operating Company and is thereby, the
duly adopted agreement and act of the said corporation.
WITNESS my hand on this 24th day of June, 1996.
/s/ Denise Jacocks
----------------------------
Assistant Secretary
Signature Page to Agreement of Merger
-8-
AMENDED AND RESTATED
PARTNERSHIP AGREEMENT OF
AJT CAPITAL PARTNERS
<PAGE>
TABLE OF CONTENTS
-----------------
Page
ARTICLE 1 ................................................................. 1
1.1 Definitions .................................................... 1
ARTICLE 2 ................................................................. 5
2.1 Formation of Partnership ....................................... 5
2.2 Partnership Name ............................................... 6
2.3 Principal Office ............................................... 6
2.4 Term of Partnership ............................................ 6
2.5 Organization Certificate ....................................... 6
2.6 Organization of the Partnership ................................ 6
ARTICLE 3 ................................................................. 6
3.1 Purposes of the Partnership .................................... 6
ARTICLE 4 ................................................................. 6
4.1 Initial Capital Contributions of the Partners .................. 6
4.2 Additional Contributions ....................................... 7
4.3 Capital Accounts ............................................... 8
ARTICLE 5 ................................................................. 9
5.1 Rights and Obligations of the Partners ......................... 9
5.2 Compensation of the Partners and Affiliates and
Reimbursements to the Partners ................................. 10
5.3 Other Interests and Transactions ............................... 10
5.4 Designation of Partner Representative and Responses
to Consent Requests ............................................ 10
5.5 Meetings of Partners ........................................... 11
5.6 Annual Audit ................................................... 11
5.7 Indemnification of the Partners ................................ 11
5.8 Restrictions ................................................... 12
5.9 Tax Rules Governing the Partnership ............................ 12
5.10 ASC Acquisition Financing ...................................... 13
ARTICLE 6 ................................................................. 13
6.1 No Assignments of Ownership Interests .......................... 13
6.2 Assignment of Distributive Rights .............................. 15
6.3 Survival of Liabilities ........................................ 15
ARTICLE 7 ................................................................. 15
7.1 Partnership Allocations ........................................ 15
7.2 Fiscal Year and Accounting Method .............................. 16
7.3 Determination of Profit and Loss ............................... 16
7.4 Distributions .................................................. 16
7.5 Elections by Partnership as to Optional Adjustment
to Basis ....................................................... 16
7.6 Time of Allocations ............................................ 16
i
<PAGE>
ARTICLE 8 ................................................................. 16
8.1 Dissolution and Termination of the Partnership or a
Partner ........................................................ 16
8.2 Effect of Dissolution, Liquidation or Adjucated
Bankruptcy of a Partner; Removal of a Partner .................. 17
8.3 Purchase Price of Ownership Interest ........................... 17
8.4 Manner of Payment for Ownership Interest ....................... 20
8.5 Liquidation of Assets .......................................... 20
8.6 Distribution of Proceeds from Liquidation ...................... 21
8.7 Indemnification of the Liquidating Trustee ..................... 22
ARTICLE 9 ................................................................. 22
9.1 Dispute Resolution ............................................. 22
9.2 Venue .......................................................... 22
9.3 Independent Nature of Mediator/Arbitrator ...................... 22
9.4 Mediation Proceeding ........................................... 22
9.5 Procedures; Scope of Arbitration ............................... 23
9.6 Selection of Arbitrators ....................................... 23
9.7 Jurisdiction of the District Court ............................. 23
9.8 Costs and Expenses ............................................. 24
ARTICLE 10
10.1 Notices ........................................................ 24
10.2 Law Governing .................................................. 24
10.3 Amendments ..................................................... 25
10.4 Successors and Assigns ......................................... 25
10.5 Counterparts ................................................... 25
10.6 Gender and Number .............................................. 25
10.7 Severability ................................................... 25
10.8 Headings ....................................................... 25
10.9 References ..................................................... 25
10.10 Payment of Legal Fees .......................................... 26
10.11 Time of the Essence ............................................ 26
ii
<PAGE>
AMENDED AND RESTATED
PARTNERSHIP AGREEMENT OF
AJT CAPITAL PARTNERS
THIS AMENDED AND RESTATED PARTNERSHIP AGREEMENT OF AJT CAPITAL PARTNERS is
made and entered into this 30th day of November, 1994 ( the "Execution Date"),
but effective as of February 14, 1992 (the "Effective Date"), by and between RCP
MANAGEMENT L.P., a Texas limited partnership ("RCP"), and J/T AVIATION PARTNERS,
a Delaware general partnership ("J/T"), as Partners.
W I T N E S S E T H:
WHEREAS, the Partners and Aviation Rotables Acquisition Corp., a Texas
corporation ("ARAC"), formed the Partnership (as hereafter defined) pursuant to
that certain Initial Partnership Agreement of AJT Capital Partners dated
February 14, 1992 (the "Initial Partnership Agreement");
WHEREAS, the Initial Partnership Agreement was restated pursuant to that
certain Restated Partnership Agreement of AJT Capital Partners dated February
28, 1992 (the "First Restated Partnership Agreement");
WHEREAS, ARAC has previously assigned its entire Ownership Interest and all
other right, title and interest in the Partnership under the Initial Partnership
Agreement and Restated Partnership Agreement to RCP and has previously withdrawn
from the Partnership;
WHEREAS the Partners desire to join together to cause the Partnership to
contribute the aircraft and engine spare parts and related assets heretofore
owned by the Partnership to ASC Acquisition Partners, L.P., a Delaware limited
partnership ("ASC"), to cause ASC to assume certain liabilities of the
Partnership, and to acquire a twenty percent (20%) interest as a limited partner
in ASC (the "ASC Partnership Interest"); and
WHEREAS, the Partners desire to formalize their understanding and
agreements and reduce such agreements to writing in this Amended and Restated
Partnership Agreement;
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, the parties hereto hereby agree as follows:
ARTICLE 1
1.1 Definitions. As used in this Agreement, the following terms shall have
the respective meanings indicated:
<PAGE>
(a) "Affiliate" means, with respect to a Partner, a Person that,
either directly or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, such Partner and, if
such Person is an individual, then any member of such Person's family. The
term "control," as used in the immediately preceding sentence, means, with
respect to a Person that is a corporation, the right to exercise directly
or indirectly, more than ten percent (10%) of the voting rights
attributable to the shares of the controlled corporation and, with respect
to a Person that is not a corporation, being in possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of the Person.
(b) "Agent" means Citicorp securities, Inc., in its capacity as agent
for the Senior Lenders and the issuing banks under the Senior Credit
Facility.
(c) "Agreement" means this Amended and Restated Partnership Agreement
as hereafter amended from time to time.
(d) "AIS Assumed Liabilities" means certain liabilities of the
Partnership that will be assumed by ASC in accordance with the provisions
of Section 3.1(b), as more Particularly described on Schedule 1.1(d)
attached hereto.
(e) "AIS Contributed Assets" means certain assets owned by the
Partnership and to be contributed by the Partnership to ASC in accordance
with the provisions of Section 3.1(b), as more particularly described on
Schedule 1.1(e) attached hereto.
(f) "AIS Retained Assets" means certain assets owned by the
Partnership that will be retained by the Partnership and not contributed by
the Partnership to ASC, as more particularly described on Schedule l.l(f)
attached hereto.
(g) "AIS Retained Liabilities" means certain liabilities of the
Partnership that will be retained by the Partnership and not be assumed by
ASC, as more particularly described on schedule 1.1(g) attached hereto.
(h) "ASC Partnership Agreement" means that certain Limited Partnership
Agreement of ASC Acquisition Partners, L.P., a Delaware limited
partnership, executed or to be executed by and among ASMC, as general
partner, and AVAC Corporation, a Delaware corporation, the Partnership, and
J/T, as limited partners.
(i) "ASMC" means Aviation Sales Management Company, a Delaware
corporation.
(j) "Bankruptcy" means, as to any Partner, that Partner's taking or
acquiescing in the taking of any action seeking relief under, or advantage
of, any applicable debtor relief,
2
<PAGE>
liquidation, receivership, conservatorship, bankruptcy, moratorium,
rearrangement, insolvency, reorganization, or similar law effecting the
rights or remedies of creditors generally, as in effect from time to time.
For the purpose of this definition, the term "acquiescing" shall include,
without limitation, the failure to file, within sixty (60) days after its
entry, a petition, answer, or motion to vacate or to discharge any order,
judgment, or decree providing for any relief under any such law.
(k) "Capital Account" means the account established for each Partner
pursuant to Section 4.3.
(1) "Code" means the Internal Revenue Code of 1986, as amended.
(m) "Initial Capital Contribution" means the capital and property
contributed by the Partners to the Partnership, as described in Section 4.1
of the First Restated Partnership Agreement.
(n) "Junior Subordinated Debt" means junior subordinated loans
totalling $7,000,000 to be obtained by ASC from Tomen America Inc., Japan
Fleet Service Co., Ltd., and RCP.
(o) "Liquidating Trustee" means the Person appointed pursuant to
Section 8.5, to supervise the liquidation of the Partnership.
(p) "Management Agreement" means that certain Asset Management
Agreement of even date herewith executed by the Partnership and ASMC,
whereby ASMC agrees to provide certain asset management services to the
Partnership, upon the terms and conditions set forth therein.
(q) "Net Cash Flow" means all gross revenues of the Partnership from
all sources, including, without limitation, operating revenues, revenues
from the sales or leases of Partnership Assets, and net proceeds from
financing or refinancing, distributions of cash or other property by ASC to
the Partnership, less all cash expenses end disbursements of the
Partnership of any kind and nature, including, without limitation,
operating expenses, repair and maintenance expenses, marketing costs,
capital expenditures, professional fees, debt service on any loans or
capital leases of the Partnership and reasonable Reserves, but not
including non-cash expenses or items, such as depreciation and
amortization, and shall be calculated on a calendar quarter basis.
(r) "Ownership Interest" means the interest in the Partnership owned
by a Partner set forth in Section 4.1, as adjusted pursuant to this
Agreement.
3
<PAGE>
(s) "Partner" means RCP or J/T, as the case may be, and their
respective legal representatives, successors, and permitted assigns.
(t) "Partners" means collectively RCP and J/T and their respective
legal representatives, successors, and permitted assigns.
(u) "Partnership" means the general partnership formed pursuant to the
Initial Partnership Agreement as hereafter governed by the terms of this
Agreement.
(v) "Partnership Assets" means the real, personal and intangible
property owned by the Partnership from time to time, including, without
limitation, the ASC Partnership interest.
(w) "Partnership Law" means the Delaware Uniform Partnership Law,
Delaware Code Annotated, Title 6, Chapter 15, as amended from time to time.
(x) "Person" means an individual, partnership, corporation, trust,
unincorporated association, or other entity or association.
(y) "Prime Rate" means the base rate of Citibank, N.A. in New York,
New York, as announced from time to time.
(z) "Profits" and "Losses" means, for each Partnership Year (as
defined in Section 7.2), an amount equal to the Partnership's taxable
income or loss for such year or period, determined in accordance with Code
Section 703(a) (for this purpose, all items of income, gain, loss, or
deduction required to be stated separately pursuant to Code Section
702(a)(1) shall be included in taxable income or loss), with the following
adjustments:
(1) Any income of the Partnership that is exempt from federal
income tax and not otherwise taken into account in computing Profits
and Losses pursuant to this Section 1.1(z) shall be added to such
taxable income or loss;
(2) Any expenditures of the Partnership described in Code Section
705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures
pursuant to the Regulations issued pursuant to the Code, and not
otherwise taken into account in computing Profits and Losses pursuant
to this Section 1.1(z) shall be subtracted from such taxable income or
loss;
(3) All items of Partnership income, gain, loss, or deduction
shall be computed without reference to any basis adjustments under
Code Sections 732(d), 734(b) or 743(b).
4
<PAGE>
For purposes of this definition of "Profits" and "Losses", references to Code
Sections and the Regulations issued pursuant thereto are to the Code and related
Regulations in effect as of the Effective Date.
(aa) "Regulations" means the income tax regulations promulgated under the
Code by the Department of the Treasury, as such regulations may be amended from
time to time (including corresponding provisions of successor regulations).
(ab) "Reserves" as to any period means the amount allocated by the Partners
to a reserve account established for the Partnership for contingent liabilities,
working capital, and payment of other obligations, costs, or expenses.
Each of the following terms is defined in the part or Section of this
Agreement set forth opposite such term:
Term Section
---- -------
Affected Partner Section 8.1(a)
ARAC Preamble
ASC Preamble
ASC Partnership Interest Preamble
Defaulted Obligations Section 4.2(c)
Dispute Section 9.1
Dissolution Event Section 8.1(a)
Effective Date Preamble
Execution Date Preamble
Fair Market Value Section 8.3
First Restated Partnership Agreement Preamble
Indemnified Parties Section 5.7
Initial Partnership Agreement Preamble
J/T Preamble
Parties Section 9.1
Partnership Year Section 7.2
Purchasing Partner Section 8.2(b)
RCP Preamble
Selling Partner Section 8.3(a)
Senior Credit Facility Section 5.10
Senior Lenders Section 5.10
Tax Matters Partner Section 5.9(b)
Term Section 2.4
ARTICLE 2
2.1 Formation of Partnership. The parties hereto hereby reconfirm formation
of the Partnership pursuant to the Partnership Law. The rights and liabilities
of the Partners shall, except as hereinafter expressly stated to the contrary,
be governed by the laws of the State of Delaware.
5
<PAGE>
2.2 Partnership Name. The business of the Partnership shall be conducted
under the name of "AJT Capital Partners" or such other name as the Partners may
select from time to time.
2.3 Principal Office. The principal place of business of the Partnership
shall be at 6905 N.W. 25th Street, Miami, Florida 33122, and at such other
locations within or outside the State of Florida as may be agreed upon by the
Partners.
2.4 Term of Partnership. The term of the Partnership {the "Term") commenced
on the Effective Date, and shall continue as provided herein until dissolved
pursuant to Section 8.1.
2.5 Organization Certificate. The Partners shall immediately execute, file,
record and/or publish such certificates and other documents, and take all other
appropriate action, to comply with all legal requirements for the formation of a
general partnership under the Partnership Law, and its operation in the State of
Delaware.
2.6 Organization of the Partnership. The Partners have joined to form the
Partnership. It is expressly understood and agreed that no additional Partner
shall be admitted to the Partnership except as specifically provided herein.
ARTICLE 3
3.1 Purposes of the Partnership. The purposes of the Partnership shall be
(a) to acquire the ASC Partnership Interest in accordance with the terms and
conditions of the ASC Partnership Agreement; (b) to contribute the AIS
Contributed Assets to ASC, subject to the assumption by ASC of the AIS Assumed
Liabilities, in accordance with the terms and conditions of the ASC Partnership
Agreement; (c) to own, hold for investment, manage, sell or exchange all or a
portion of the Partnership Assets; (d) to enter into the Management Agreement
for the purposes of causing ASMC to manage the business affairs of the
Partnership; (e) to borrow funds to the extent permitted by Section 5.1 to
facilitate the Partnership's business activities provided for under
subparagraphs (a) through (d) of this Section 3.1, and to pledge all or any
portion of the Partnership Assets as security for such debt; (f) to perform any
other acts or engage in any other business(es) as to which the Partners agree;
and (g) to take any and all actions necessary and prudent to the successful
pursuit of the foregoing purposes; provided, however, that no actions taken
under this Section 3.1(g) shall be inconsistent with Sections 3.1(a) through (f)
ARTICLE 4
4.1 Initial Capital Contributions of the Partners. In connection with the
execution of the First Restated Partnership
6
<PAGE>
Agreement, the Partners contributed to the Partnership the amounts described in
the First Restated Partnership Agreement as their respective Initial Capital
Contributions.
In return for such contributions, each Partner received such Partner's
initial Ownership Interest in the Partnership in accordance with the provisions
of the First Restated Partnership Agreement.
As of the date hereof, the Partners agree that the Ownership Interests of
the Partners are:
RCP 52%
J/T 48%
4.2 Additional Contributions.
(a) The Partners shall have no mandatory obligations to contribute
additional capital to the Partnership.
(b) Notwithstanding the foregoing, the Partners may from time to time
elect jointly to make additional capital contributions to the Partnership.
Such additional capital contributions shall, unless the Partners shall
otherwise agree in writing, be in amounts pro rata to the Partners' initial
Ownership Interests.
(c) If any Partner fails or refuses to contribute the entire amount of
any additional contributions agreed upon pursuant to Section 4.2(b) (the
"Defaulted Obligations") within ten (10) days after the date on which the
non-defaulting Partner makes its contribution, then the non-defaulting
Partner shall have the following mutually exclusive remedies:
(1) The non-defaulting Partner shall have the right to cause the
Partnership to exercise any remedy or take any action available to it
at law or equity, including, without limitation, pursuing appropriate
legal action to specifically enforce the obligation of such defaulting
Partner and to recover from such defaulting Partner any legal fees and
costs of court incurred in enforcing such Defaulted Obligations.
(2) In the alternative, the non-defaulting Partner shall be
entitled to contribute to the Partnership the portion of the Defaulted
Obligations. Any such contribution made by the non-defaulting Partner
with respect to the Defaulted Obligations shall be repaid to the
non-defaulting Partner out of Net Cash Flow otherwise distributable to
the defaulting Partner, as provided in Section 7.4, until the amount
of the Defaulted Obligations has been returned in full.
7
<PAGE>
Upon the funding of any such contribution by the non-defaulting
Partner, the Ownership Interest and Capital Account balance of the
defaulting Partner shall be allocated to the non-defaulting Partner
making such contribution as follows:
(A) The defaulting Partner's Ownership Interest shall be
allocated to the non-defaulting Partner, on the basis of one
percentage point (1%) (or fraction thereof) per each $40,000 of
additional capital contribution made by the non-defaulting
Partner;
(B) The defaulting Partner's Capital Account shall be
reduced by $2.00 for every $1.00 of the additional contributions
made by the non-defaulting Partner (but not below zero) and the
Capital Account of the non-defaulting Partner shall be increased
by an equal amount;
(C) Thereafter, allocations of Profit and Losses and
distributions of Net Cash Flow in accordance with Articles 7 and
8 shall take into account that the non-defaulting Partner shall
be entitled to receive allocations and distributions attributable
to the Ownership Interest and Capital Account reallocated to the
non-defaulting Partner under this Section 4.2(c).
For example, if the amount of Defaulted Obligations were equal to
$200,000 and the non-defaulting Partner contributed such amount to the
Partnership, then the non-defaulting Partner would be allocated five
percent (5%) of the defaulting Partner's Ownership Interest ($200,000
divided by $40,000 per 1%) and the Ownership Interest of the
defaulting Partner would be reduced accordingly; and the defaulting
Partner's Capital Account would be decreased by the lesser of (a)
$400,000 ($200,000 x 2) or (b) the positive balance thereof, and the
Capital Account of the non-defaulting Partner would be increased
accordingly.
(3) In the alternative, the non-defaulting Partner shall have the
right to elect not to make its additional contributions required under
Section 4.2(b) and thereby be excused from making such additional
contributions.
4.3 Capital Accounts.
(a) Capital Accounts. An individual capital account shall be maintained for
each Partner (a "Capital Account"), which shall initially be zero dollars and
shall be adjusted as set forth in this Section 4.3.
8
<PAGE>
(b) Credits to or Increases of Capital Accounts. The Capital Account of
each Partner shall be credited with or increased by the following:
(1) The amount of any money the Partner contributed or contributes to
the Partnership, including, but not limited to, money contributed pursuant
to Section 4.1;
(2) The fair market value of any property the Partner contributes to
the Partnership, including, but not limited to, property contributed
pursuant to Section 4.1 (net of any liabilities secured by such contributed
property that the Partnership assumes or subject to which the Partnership
takes the property);
(3) The amount of Profits allocated to the Partner pursuant to Section
7.1; and
(4) The income or gain inherent in any property the Partnership
distributes to the Partner to the extent such income or gain has not been
previously reflected in the Capital Accounts.
(c) Reductions of Capital Accounts. The Capital Account of each Partner
shall be debited with or reduced by the following:
(1) The amount of money the Partnership distributes to the Partner
pursuant to Section 7.4 or 8.6;
(2) The fair market value of any property the Partnership distributes
to the Partner pursuant to Section 7.4 or 8.6 (net of any liabilities
secured by such distributed property that the Partner assumes or subject to
which the Partner takes the property);
(3) The amount of Losses allocated to the Partner pursuant to Section
7.1;
(4) The deduction or loss inherent in any property the Partnership
distributes to the Partner to the extent such deduction or loss has not
been previously reflected in the Capital Accounts; and
(5) The amount of any tax withheld or paid by the Partnership with
respect to the Partner under applicable law
ARTICLE 5
5.1 Rights and Obligations of the Partners. Subject to the limitations of
this Agreement, the Partners acting jointly shall have full and complete
authority and discretion to manage and
9
<PAGE>
control the Partnership and to make all decisions affecting the management and
operation of the Partnership's business. Except for management authority
delegated to ASMC pursuant to the Management Agreement, all actions of the
Partnership shall require the consent of both Partners. Subject to the
limitations of this Agreement and the Management Agreement, the Partners shall
jointly control the day-to-day operation and management of the Partnership and
shall have full authority to take any action which the Partners reasonably
believe in good faith to be in furtherance of the Partnership's business and
purposes as established from time to time by the Partners and to exercise all
rights and powers generally conferred by law in connection therewith, including
contracting with appropriate Persons to provide services to the Partnership at
the reasonable expense of the Partnership. The Partners shall manage the
Partnership affairs in a prudent and businesslike manner in accordance with
standard industry practice and at all times shall act as fiduciaries in the best
interests of the Partnership in Pursuit of the purposes herein stated.
5.2 Compensation of the Partners and Affiliates and Reimbursements to the
Partners. The Partners shall be entitled to be reimbursed on a monthly basis for
all direct out-of-pocket costs and expenses incurred in connection with the
administration and operation of the Partnership. Except as specifically provided
herein, no Partner shall be entitled to any compensation by way of salary or
percentage return on the Capital Accounts, other than a share of Profits and Net
Cash Flow as herein expressly provided.
5.3 Other Interests and Transactions. No Partner shall, merely by virtue of
its interest in the Partnership, be in any way prohibited from, or restricted in
engaging in, or possessing an interest in, any other business venture of any
nature, including any venture engaged in the acquisition, ownership and/or
marketing of aircraft and engine spare parts. The Partners shall devote such
part of their time as is reasonably necessary to administer the Partnership's
business. Any Partner may engage in transactions for its own accounts and for
the accounts of others during the Term of this Agreement, whether or not such
activities are deemed competitive with the Partnership.
5.4 Designation of Partner Representative and Responses to Consent
Requests. Each Partner shall designate a representative to receive notices and
respond to requests for consents under this Agreement. If a Partner fails or
refuses to respond to a written request for consent within ten (10) days after
such Partner receives such written request for consent (unless a longer or
shorter period of time is required under this Agreement), then such Partner
shall be conclusively deemed to have consented to such proposal. For purposes of
this Section 5.4, the designated representative of the RCP shall be Robert
Alpert, and the designated representative of J/T shall be Japan Fleet Service
(Delaware) Inc. through its President, Tim L. Watkins. A Partner
10
<PAGE>
shall have the right to change its designated representative by written notice
to the other Partners in accordance with Section 10.1.
5.5 Meetings of Partners. A meeting of the Partners shall be held at such
times and at such places as determined by the unanimous agreement of the
Partners. The Partners may hold a meeting in person, over the telephone or
through written consents or correspondence.
5.6 Annual Audit. The Partners shall cause an audit to be made of the
financial condition of the Partnership for each fiscal year of the Partnership
within a reasonable time after the close of each fiscal year (but not later than
ninety (90) days after the close of the Partnership's fiscal year), and the
Partners shall each receive a copy of such audit as soon as such audit is
available. Such audit shall be performed by a "Big Six" accounting firm selected
by the mutual agreement of the Partners, and the cost of such audit shall be
paid by the Partnership. Any Partner may, at any time and at the Partnership's
expense, cause an audit to be made of the financial condition of the Partnership
and the compliance of the Partners with the financial, accounting and reporting
provisions of this Agreement.
5.7 Indemnification of the Partners. No Partner shall not be liable to the
other Partner, its partners, shareholders or Affiliates, for any loss of their
respective contributions or loans to the Partnership or any loss of potential
profits, unless such loss shall have resulted, directly or indirectly, from (a)
the gross negligence, willful misconduct or unlawful act of such Partner, or (b)
the material breach by such Partner of its obligations hereunder. Subject to the
preceding sentence, to the full extent permitted by applicable law (including
Section 1518(2) of the Partnership Law), the Partners, their shareholders,
officers, directors, employees and agents ("Indemnified Parties") shall be
indemnified and held harmless by the Partnership (but only to the extent that
the Partnership Assets are sufficient therefor) from and against, and the
Partnership shall reimburse the Indemnified Parties for, all judgments,
penalties, including excise and similar taxes, fines, settlements and reasonable
expenses if such Indemnified Party was, is, or is threatened to be named as a
defendant or respondent in any legal proceeding based upon or arising out of
their having acted as the Partner hereunder or in connection herewith. Except as
set forth in this Section, the foregoing shall be deemed to make mandatory the
indemnifications permitted under Section 1518(2) of the Partnership Law and to
authorize advance payment of expenses to the full extent permitted by applicable
law. It is expressly stipulated, however, that the Indemnified Parties shall not
be entitled to indemnification hereunder where the claim at issue is based upon:
11
<PAGE>
(a) The gross negligence, willful misconduct or unlawful act of an
Indemnified Party; or
(b) The material breach by such Partner of any provision of this
Agreement.
The indemnification rights herein contained shall be cumulative of, and in
addition to, any and all other rights, remedies, and recourses to which the
Indemnified Parties shall be entitled, whether pursuant to this provision or
some other provision of this Agreement, at law or in equity.
5.8 Restrictions. Without the written consent or deemed consent of all of
the Partners, no Partner shall:
(a) Make, execute or deliver any assignment for the benefit of
creditors, bond, confession of judgment, mortgage, deed, guaranty or
contract of sale of all or substantially all of the Partnership Assets,
except as otherwise provided herein;
(b) Utilize Partnership Assets in any way for the furtherance of
personal business activities unrelated to the Partnership business;
(c) Make any distributions other than as provided in Articles 7 or 8;
(d) Loan any of the Partnership's funds to any Person;
(e) Amend or modify this Agreement;
(f) Pledge, hypothecate or in any manner sell, assign or transfer such
Partner's Ownership Interest, except as otherwise provided herein;
(g) Admit any other Person as a Partner into the Partnership except as
expressly permitted by this Agreement;
(h) Withdraw from the Partnership; or
(i) Take any action on behalf of the Partnership not in furtherance of
the Partnership's purposes.
5.9 Tax Rules Governing the Partnership.
(a) The Partners hereby acknowledge and agree that it is the intention
of the Partnership to be governed by the provisions of Subchapter K of the
Code, and all rules and regulations promulgated thereunder. The Partners
shall take any and all actions necessary to insure full compliance by the
Partnership of all such applicable provisions, rules and regulations,
including, but not limited to, the filing of
12
<PAGE>
information returns as required by Section 6031 of the Code, or similar
provisions of later law.
(b) RCP shall serve as the "Tax Matters Partner" for the Partnership
for purposes of and under the Code. As Tax Matters Partner, RCP shall keep
the Partners informed of all administrative and judicial proceedings, as
required by Section 6223(g) of the Code, and shall furnish to the Partners
a copy of each notice or other communication received by RCP from the
Internal Revenue Service.
(c) As Tax Matters Partner, RCP shall not have the authority, unless
such action has been approved by all the Partners, to do any of the
following:
(1) To enter into a settlement agreement with the Internal
Revenue Service which purports to bind Partners other than RCP;
(2) To file a petition as contemplated in Section 6226(a) or 6228
of the Code;
(3) To intervene in any action as contemplated in Section 6226(h)
of the Code;
(4) To file any request contemplated in Section 6227(b) of the
Code; or
(5) To enter into an agreement extending the period of
limitations as contemplated in Section 6229(b)(1)(B) of the Code.
(d) RCP acknowledges that the relationship of the Tax Matters Partner
to J/T is that of a fiduciary, and the Tax Matters Partner has a fiduciary
obligation to perform its duties as Tax Matters Partner in such manner as
will serve the best interests of the Partnership and the Partners.
5.10 ASC Acquisition Financing. In connection with the acquisition of
certain assets by ASC, the Partnership shall pledge the ASC Partnership Interest
to secure a senior credit facility (the "Senior Credit Facility"), in the amount
of eighty million dollars ($80,000,000.00) obtained by ASC from senior lenders
acceptable to ASC (collectively, the "Senior Lenders").
ARTICLE 6
6.1 No Assignments of Ownership Interests.
(a) No Partner may sell, assign, transfer, pledge, mortgage, or grant
a lien or security interest in its Ownership Interest, or portions of such
Ownership Interest, and thereby
13
<PAGE>
constitute the vendee or assignee a substituted Partner, without first
having obtained the written consent of the other Partner.
(1) RCP shall be deemed to have sold, assigned or transferred its
Ownership Interest if any partnership interest in RCP is sold,
assigned or transferred unless:
(A) Alpert retains control of RCP; and
(B) Any transferee of such partnership interest is either a
blood relative of Alpert or a trust which has all of the
following characteristics:
(i) Members of Alpert's immediate family, including any
descendants, are (and will remain) the sole beneficiaries of
the trust;
(ii) Either Alpert is (and will remain) the sole
trustee or co-trustee of the trust, or the partnership
interests in RCP of all trusts of which Alpert is not the
sole trustee is less than thirty-three percent (33%); and
(iii) The partnership interest may not be transferred
or assigned by the trust, except to another trust satisfying
the requirements of this Section 6.1(a), and the trust will
not be terminated prior to the termination of this
Agreement; and
(2) J/T shall be deemed to have sold, assigned or transferred its
Ownership Interest if any partnership interest in J/T is sold,
assigned or transferred unless Japan Fleet Service (Singapore) Pte.
Ltd. or an Affiliate of Japan Fleet Service (Singapore) Pte. Ltd.
and/or Tomen Corporation or an Affiliate of Tomen Corporation retains
control of J/T.
(b) For purposes of this Section 6.1, the term "control" shall mean
(i) the right to vote directly or indirectly at least fifty-one percent
{51%) of the total voting power of all classes of stock of the entity in
the case of a corporation, or (ii) the right to vote more than fifty
percent (50%) of all partnership interests in the case of a partnership, or
(iii) the power to direct or cause the direction of the management or
policies of the Person.
(c) Upon any transfer of a Partner's Ownership Interest satisfying the
provisions of this Section 6.1, and the transferee's agreement to become
bound by all of the provisions of this Agreement, the transferee shall
become a substituted Partner.
14
<PAGE>
6.2 Assignment of Distributive Rights.
(a) A Partner may assign to any Person all or any portion of such
Partner's right to receive distributions hereunder. No such assignment
shall be effective as to the Partnership unless the other Partner has
received fifteen (15) business days prior written notice of such proposed
assignment, which notice shall include a description of the proposed
transaction (including the amount of the proposed transfer), and the other
Partner shall have received:
(1) A copy of the instrument of assignments in recordable form,
executed by both the assignor and the assignee of such distributive
right;
(2) An instrument in such form as may be prescribed by or
otherwise acceptable to the Partnership, executed by the assignor,
instructing the Partnership as to what percentage, to whom, and where
such distributive share is to be paid; and
(3) An identification number for United States federal income tax
purposes for such assignee.
(b) If the conditions described in Section 6.2(a) have been satisfied,
the Partnership may (but shall not be obligated to), without requesting
further documentation from either the assignor or the assignee, remit
directly to the named assignee all distributions to which such Partner may
be entitled pursuant to the provisions of this Agreement and the
assignment. So long as the party to whom such distributive share was
remitted was either the assignor or the assignee named in the instrument of
assignment, the Partnership shall be free from liability to any person if
such distribution is received by a person that is not entitled thereto.
6.3 Survival of Liabilities. It is expressly understood and agreed that no
sale or assignment of an Ownership Interest, even if it results in the
substitution of the assignee or vendee as a Partner herein, shall release the
assignor or vendor from those liabilities to the Partnership which survive such
assignment or sale as a matter of law.
ARTICLE 7
7.1 Partnership Allocations. Profits and Losses (including, to the extent
necessary, each item of income, gain, loss, deduction, and credit) shall be
allocated among the Partners in proportion to their respective Ownership
Interests at the time of such allocation. If the basis of any Partnership Asset
is adjusted as a result of an election made pursuant to Section 754 of the Code,
the tax consequences of that adjustment shall be allocated to the Ownership
Interest with respect to which the
15
<PAGE>
adjustment was made. Except as provided in Section 8.6, all distributions of
cash or other property by the Partnership shall be made in proportion to the
respective Ownership Interests of the Partners at the time of such distribution.
7.2 Fiscal Year and Accounting Method. The Partnership fiscal year shall be
the calendar year ("Partnership Year"). The Partnership books shall be kept on
such method as is recommended by the accounting firm performing the audit under
Section 5.6.
7.3 Determination of Profit and Loss. At the end of each Partnership Year,
all Partnership Profits and Losses shall be determined for the accounting period
then ending and shall be allocated to the Capital Accounts of the Partners in
accordance with the provisions of Section 7.1. However, in instances where a
Partner has sold, assigned, transferred or otherwise disposed of all or part of
its Ownership Interest during such accounting period, all such allocations shall
be made between the transferor and the transferee in accordance with Section 706
of the Code. The determinations made pursuant to this Section 7.3 shall be
binding on all Partners.
7.4 Distributions. Subject to the provisions of Section 8.6, the Net Cash
Flow of the Partnership shall be distributed to the Partners on a quarterly
basis as provided in Section 7.1.
7.5 Elections by Partnership as to Optional Adjustment to Basis. Where a
distribution of property is made in the manner provided in Section 734 of the
Code or where a transfer of Ownership Interest permitted by this Agreement is
made in the manner provided in Section 743 of the Code, the Partners shall file
on behalf of the Partnership, upon any remaining Partner's request, an election
under Section 754 of the Code in accordance with the procedures set forth in the
applicable Treasury Regulations.
7.6 Time of Allocations. Except as otherwise required by any other Sections
of this Agreement or the Code, allocations pursuant to this Article 7 shall be
made as of the last day of each Partnership Year.
ARTICLE 8
8.1 Dissolution and Termination of the Partnership or a Partner. The
Partnership shall continue until, and shall automatically dissolve upon. the
later to occur of (1) the end of the twentieth (20th) year from the Execution
Date and (2) the payment in full of the Senior Credit Facility and the Junior
Subordinated Debt, unless sooner dissolved upon the earliest to occur of the
following events, which shall cause an immediate dissolution of the Partnership:
16
<PAGE>
(a) The dissolution, liquidation, resignation, removal, Bankruptcy,
death, or incapacity of a Partner, or the occurrence of any other act which
would legally disqualify or impede a Partner (the "Affected Partner") from
acting hereunder (a "Dissolution Event"); provided, however, that if,
within forty-five (45) days after the occurrence of a Dissolution Event,
the other Partner exercises any of the options described in Section 8.2,
the Partnership shall not be dissolved and shall continue;
(b) The unanimous consent of the Partners to dissolve;
(c) Within a reasonable time after the Partnership ceases to maintain
any interest (including, without limitation interest as lienholder or
secured party or right of redemption repurchase) in the Partnership Assets,
including, but not limited to, the sale, conveyance or transfer of the
Partnership Assets by deed, foreclosure or deed in lieu of foreclosure
without the retention of a lien or right to repurchase the Partnership
Assets in favor of the Partnership, or through the termination of any deed
of trust or redemption right or right of repurchase retained favor of the
Partnership; and (ii) distributes to the Partners of all proceeds from such
sale, conveyance or transfer, if any; or
(d) The occurrence of an event which would render continuation of the
Partnership existence, business or operation unlawful.
8.2 Effect of Dissolution, Liquidation or Adjudicated Bankruptcy of a
Partner; Removal of a Partner.
(a) In the event of the occurrence of a Dissolution Event (as defined
in Section 8.1(a)), the other Partner shall have the option, which must be
exercised by written notice within forty-five (45) days from the date of
any of the events described in Section 8.1(a), to either (i) purchase the
Ownership Interest of the Affected Partner in accordance with this Article
8; or (ii) reconstitute the Partnership and continue the business of the
Partnership in a reconstituted form. In the event that the option described
in the foregoing clause (ii) is exercised, the results of such exercise
shall be reflected in an amendment to this Agreement, which shall be
executed by all of the Partners.
(b) If any of the options described in Section 8.2(a) are exercised
within forty-five (45) days from the date of any of the events described in
Section 8.2(a), then the Partner electing to purchase the Ownership
Interest (the "Purchasing Partner") shall purchase such Ownership Interest
in accordance with the purchase price and manner of payment described in
Sections 8.3 and 8.4.
8.3 Purchase Price of Ownership Interest. The purchase price of any
Ownership Interest subject to the provisions of this
17
<PAGE>
Article 8 shall be the "Fair Market Value" of the Partnership's Assets,
including the Partnership's Ownership Interest in ASC. The "Fair Market Value"
of the Partnership's Ownership Interest in ASC shall be the sum equal to (a) the
percentage of the partnership interests of ASC represented by the ASC
Partnership Interest owned by the Partnership at such time (currently being
20%), times (b) an amount that would have been distributed with respect to such
ASC Partnership Interest had the assets then owned by ASC (the "ASC Assets"),
including, without limitation, the net value of any cash, notes or any other net
financial assets of ASC, less a reasonable reserve for contingent obligations,
been sold at a cash sales price equal to the "Fair Market Value" for the ASC
Assets determined in accordance with the appraisal procedure described below in
this Section 8.3, and the proceeds of such hypothetical sale distributed in
accordance with the ASC Partnership Agreement and then this Agreement.
The determination of the "Fair Market Value" of the ASC Assets and the
Partnership Assets (the "Subject Assets") for purposes of calculating the
purchase price for the Ownership Interest shall be made as follows:
(a) The Purchasing Partner shall so notify the Selling Partner (the
"Selling Partner") and the Purchasing Partner and the Selling Partner shall
first attempt to agree upon the Fair Market Value of the Subject Assets.
For purposes of this Agreement, the term "Fair Market Value" of the Subject
Assets, shall mean the cash price which a sophisticated purchaser would pay
on the effective date of the appraisal for the Subject Assets in excess of
the third-party financing then encumbering the Subject Assets, such
valuation to be made on the assumption that the Subject Assets are subject
to the ASC Partnership Agreement, this Agreement and to any other
agreements, including leases, management and service agreements then in
effect. A sophisticated purchaser shall be one who would take into account
the nature, extent, maturity date and other terms of the liabilities of ASC
and the Partnership, whether fixed or contingent, including the favorable
or unfavorable nature of any financing then encumbering the Subject Assets
and whether the value of the Subject Assets and the cash flow generated
therefrom would be sufficient to satisfy such liabilities when due,
excluding any liability under any financing already taken into account.
(b) In the event that the Purchasing Partner and the Selling Partner
are unable to agree upon the "Fair Market Value" of the Subject Assets
within thirty (30) days of the date that notice was first given to the
Selling Partner of the initiation of the appraisal process hereunder, then
the Purchasing Partner and the Selling Partner shall appoint an appraiser
who shall have experience in appraising aircraft and engine parts and
maintenance and warehouse facilities for at least ten (10) years, and the
"Fair
18
<PAGE>
Market Value" of the Subject Assets shall be the amount determined by such
appraiser to be the fair market value of the Subject Assets.
(c) If the Purchasing Partner and the selling Partner are unable to
agree upon a single appraiser within such thirty (30)-day period, then the
Selling Partner shall select one appraiser, and the Purchasing Partner
shall select one appraiser, and the two selected appraisers shall select a
third appraiser. All three (3) appraisers shall each have the
qualifications recited in Section 8.3(b). Each appraiser so selected shall
furnish the Partners and the certified public accountant for the
Partnership with a written appraisal within thirty (30) days of his
selection, setting forth his determination of the Fair Market Value of the
Subject Assets as of the date of the Purchasing Partner's notice to the
Selling Partner. Such appraisal shall assume that the operation of the
Subject Assets shall be the highest and best use thereof, and the appraisal
shall not include any value for any intangible assets of ASC and the
Partnership, such as goodwill. The Fair Market Value of the Subject Assets
shall be the fair market value of such assets agreed upon by the three
appraisers; provided, however, that if the three (3) appraisers cannot
agree upon such value, then the valuations of each of the three (3)
appraisers shall be submitted to the Partners and to the certified public
accountant for the Partnership and the Fair Market Value of the Subject
Assets shall be determined as follows:
(1) If any two (2) or more of the appraisers are able to agree on
the fair market value of the Subject Assets, then the "Fair Market
Value" of the Subject Assets shall be the value agreed upon by the two
(or more) appraisers.
(2) If no two (2) appraisers agree upon such value, then the
"Fair Market Value" of the Subject Assets shall be determined in the
following manner:
(A) If the highest value set by one appraiser is not more
than one hundred ten percent (110%) of the next lower value set
by another appraiser and the lowest value set by one appraiser is
not less than ninety percent (90%) of the next higher value set
by another appraiser, then the values set by the three appraisers
shall be added together and divided by three, and the resulting
amount shall represent the Fair Market Value of the Subject
Assets for purposes of this Section 8.3.
(B) If the highest value set by one appraiser is more than
one hundred ten percent (110%) of the next lower value set by
another appraiser, then the highest value shall be reduced to an
amount equal to said one hundred ten percent (110%) figure; and
if
19
<PAGE>
the lowest value set by one appraiser is less than ninety percent
(90%) of the next higher value set by another appraiser, then the
lowest value shall be increased to an amount equal to said ninety
percent (90%) figure. The three values, adjusted as provided
above, shall be added together and divided by three, and the
resulting amount shall represent the Fair Market Value of the
Subject Assets for purposes of this Section 8.3.
(C) Upon receipt of the appraisals, the independent
certified public accountant of the Partnership shall make the
final calculation as to the Fair Market Value of the Subject
Assets and of the purchase price for purposes of the provisions
of this Agreement that necessitated such appraisal. The
accountant shall notify the Partners in writing of its
calculation within ten (10) days after the date of receipt of the
appraisals prepared by the appraisers. The calculation of the
accountant as to the Fair Market Value of the Subject Assets and
the amount of the purchase price shall be binding upon the
Partners. The cost of such appraisals shall be shared equally by
the Purchasing Partner and the Selling Partner.
8.4 Manner of Payment for Ownership Interest. In the event of the
occurrence of any of the events set forth in Section 8.1, the Purchasing Partner
may elect to pay all or a portion of the purchase price in cash or in
installments. If a Purchasing Partner elects to pay in cash, then the purchase
price shall be paid in full in cash within sixty (60) days after the date on
which the option is exercised in accordance with Section 8.2.
If a Purchasing Partner elects to pay all or a portion of the purchase
price in installments, then the initial payment of the purchase price shall be
paid in cash in an amount equal to twenty-five percent (25%) of the purchase
price. Such initial payment shall be paid within sixty (60) days after the
exercise of such option under the terms of Section 8.2. The balance of the
purchase price shall be paid in equal annual installments in an amount equal to
twenty-five percent (25%) multiplied by the purchase price, payable on each
successive anniversary date of the initial payment, plus all interest on the
balance accruing at the lesser of (a) a variable annual rate equal to the Prime
Rate plus two percent (2%), or (b) the maximum lawful rate of interest, from the
date of the initial payment, until the entire balance of the deferred purchase
price is paid in full. The deferred portion of the purchase price shall be
evidenced by an installment note, secured by the portion of the Ownership
Interest being purchased, or such other collateral as may be mutually acceptable
to both parties. Such note and security agreement will be executed by the
Purchasing Partner and delivered to the Selling Partner at the time
20
<PAGE>
for the initial payment of the purchase price. Any installment note executed
hereunder shall contain provisions for prepayment, in whole or in part, at any
time, without penalty or premium.
8.5 Liquidation of Assets. On the effective date of the dissolution of the
Partnership, RCP (or J/T if RCP causes such dissolution) shall be appointed as
agent of the dissolved Partnership in liquidation, and of the Partners, for
winding up all Partnership affairs and all business transactions of the
Partnership (the "Liquidating Trustee"). The Liquidating Trustee shall continue
to serve until the completion of the winding up and liquidation, unless
Bankruptcy, insolvency or resignation shall intervene. The Liquidating Trustee
shall not be paid for its services after the dissolution of the Partnership and
the winding up for liquidating operations. It may, out of the assets and
proceeds of the assets on hand, employ such assistance as it determines
appropriate, and it may employ and pay any one of the Partners to take any such
actions and render any such services in the winding up and liquidation.
8.6 Distributlon of Proceeds from Liquidation. In the event of dissolution
of the Partnership, the business affairs of the Partnership shall be wound up
and liquidated as promptly as business circumstances and orderly business
practices will permit. The proceeds of liquidation and all Partnership cash
shall be distributed in the following order:
(a) First, to Partnership creditors (excluding the Partners) funds, to
the extent that they are available, sufficient to extinguish current
Partnership liabilities and obligations, including the costs and expenses
of liquidation; and
(b) Second, to the Partners in accordance with Section 7.1 of this
Agreement.
Notwithstanding anything to the contrary set forth hereinabove, if after
the payment of current Partnership liabilities and obligations to the extent of
the funds and/or other assets available for that purpose, either any portion of
Partnership liabilities remains unpaid or the Liquidating Trustee determines
that additional funds will be required to meet Partnership costs and expenses
theretofore incurred or for which the Partnership may become responsible, then
the Liquidating Trustee shall be obligated to retain such required amounts, if
available (or as and when they become available), before any Partnership cash or
other assets are distributed to any of the Partners. Furthermore, in the event
that Partnership assets are not adequate to satisfy obligations of the
Partnership to third parties (excluding obligations to the Partners), then the
Partners shall be obligated to contribute funds to the Partnership so as to
enable the Liquidating Trustee to satisfy such third-party obligations. Each
Partner's proportionate share of such
21
<PAGE>
obligations shall be determined in accordance with its respective Ownership
Interest. The Partners hereby confirm and acknowledge that it is their intention
that the provisions of this paragraph are personal between the Partners only,
and that no third party, including, without limitation, any third-party creditor
of the Partnership or the Partners, shall be entitled to the benefits of this
paragraph.
8.7 Indemnification of the Liquidating Trustee. The Liquidating Trustee
shall be indemnified and held harmless by the Partnership from and against any
and all claims, demands, liabilities, costs, damages and causes of action of any
nature whatsoever, arising out of or incidental to the Liquidating Trustee's
taking of any action authorized under, or within the scope of, this Article 8;
provided, however, that the Liquidating Trustee shall not be entitled to
indemnification hereunder where the claim at issue arose out of:
(a) A matter entirely unrelated to the Liquidating Trustee's acting
under the provisions of this Article 8;
(b) The gross negligence or willful misconduct of the Liquidating
Trustee; or
(c) The material breach by the Liquidating Trustee of its obligations
under this Article 8.
The indemnification rights herein contained shall be cumulative of and in
addition to, any and all other rights, remedies and recourses to which the
Liquidating Trustee shall be entitled, at law or in equity.
ARTICLE 9
9.1 Dispute Resolution. The Partners and their successors and assigns (the
"Parties") hereby agree that any and all claims, disputes and controversies
("Dispute") arising out of or relating to the interpretation or enforcement of
this Agreement, the operation of its terms, or the relationship of the parties
hereunder shall be subjected to mediation, as described herein. If the mediation
proceeding is unsuccessful, the Parties hereby agree that the Dispute shall be
decided by mandatory, final and binding arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association as
supplemented hereby.
9.2 Venue. The Parties bind themselves to mediate, and if necessary to
arbitrate, any Dispute in Miami, Florida.
9.3 Independent Nature of Mediator/Arbierator. The mediator and/or
arbitrator shall be independent of the Parties and under no circumstances shall
any mediator or arbitrator have any
22
<PAGE>
connection to or relationship with any of the Parties, or their respective
principals or employees.
9.4 Mediation Proceeding.
(a) If any Party desires to mediate any Dispute, such Party shall notify
the other Parties of the Dispute desired to be mediated, including a brief
statement of the matter in controversy. If the Parties are not able to resolve
the Dispute within five (5) days after the Party notifies the other Parties of
its desire to mediate (a "Mediation Notice"), then, within five (5) days
immediately after the expiration of the aforesaid five (5)-day period, the
Parties shall attempt to agree upon an independent mediator. If the Parties are
unable to reach an agreement upon an independent mediator within such second
five (5)-day period, then any Party shall be entitled to request that the
Judicial Arbitration and Mediation Service ("JAMS") (or similar mediation
service of a similar national scope if JAMS no longer then exists) appoint an
independent mediator who shall serve as mediator for all Purposes hereof.
(b) Within ten (10) days after selection of the mediator, the mediator
shall call for and set a meeting among the Parties and the mediator for the
purpose of mediating the Dispute. If the parties are unable to resolve the
Dispute within thirty (30) days after the Mediation Notice (the "Mediation
Period"), the Dispute shall be decided by arbitration.
9.5 Procedures; Scope of Arbitration. The Parties agree that (i) an
arbitration panel may render an interim ruling regarding discovery, summary
proceedings, or other pre-arbitration matters, and (ii) all claims of any type
by any of the Parties, including any and all defenses, are included in the
jurisdiction of the arbitration.
9.6 Selection of Arbitrators. Unless all Parties can agree in writing on a
single arbitrator within ten (10) days after the expiration of the Mediation
Period, then within a period of thirty (30) days after the expiration of the
aforesaid ten (10)-day period, each Party shall name one arbitrator by written
notice to the other. The two arbitrators named as aforesaid shall, within a
period of twenty (20) days after the date the last of such arbitrators has been
named, select a third arbitrator who shall be an attorney or retired judge and
who shall serve as chairman. If any Party fails to name an arbitrator within the
aforesaid ten (10)-day period, or if the two arbitrators named are unable to
agree on the third arbitrator, such arbitrator shall, at the request of any of
the Parties, be appointed by the American Arbitration Association.
9.7 Jurisdiction of the District Court. The Parties hereby submit to the in
personam jurisdiction of the United States
23
<PAGE>
District Court for the Southern District of Florida, and agree that such Court
may enter all such orders as may be necessary or appropriate to enforce the
provisions hereof and/or to confirm any pre-arbitration ruling or decision or
any award rendered by the panel of arbitrators. The award rendered by the
arbitrators shall be final, and judgment may be entered upon it in accordance
with applicable law in the United States District Court for the Southern
District of Florida, or in any court having jurisdiction thereof.
9.8 Costs and Expenses. Any costs or other expenses, including attorneys'
fees and costs incurred by the successful Party, arising out of or occurring
because of the arbitration proceedings may be assessed against the unsuccessful
Party, borne equally, or assessed in any other reasonable manner within the
discretion of the panel of arbitrators and shall be included as a part of any
award rendered by the arbitrators.
ARTICLE 10
10.1 Notices. All notices or other communications required or permitted to
be given pursuant to this Agreement shall be in writing and shall be considered
as properly given if hand delivered or if mailed from within the United States
by first class United States mail, postage prepaid, or by overnight carrier
guaranteeing next-day delivery, or, if from outside the United States, by
overnight carrier guaranteeing next-day delivery, and addressed as follows:
If to RCP: RCP Management L.P.
15311 vantage Parkway west
Suite 315
Houston, Texas 77032
Attention: Mr. Robert Alpert, Chairman
Telecopy No.: (713) 485-2090
With a copy to: Boyar, Simon & Miller
4265 San Felipe
Suite 1200
Houston, Texas 77027
Attention: J. William Boyar, Eeq.
Telecopy No.: (713) 552-1758
If to J/T: Tomen America Inc.
1285 Avenue of the Americas
New York, New York 10019
Attention: Mr. Takashi Yoshida
Vice President, General Manager
Machinery-Electronics Dept.
Telecopy No.: (212) 541-7251
- AND -
24
<PAGE>
Japan Fleet Service (Delaware) Inc.
c/o Japan Fleet Service (Singapore)
Pte. Ltd.
10 Shenton Way, No. 17-06/09
Monetary Authority of Singapore
Building
Singapore 0207
Attention: Mr. Tim L. Watkins
Managing Director, President and
Chief Executive Officer
Telecopy No.: 011-65-2255583
With a copy to: Orrick, Herrington, Sutcliffe
1285 Avenue of the Americas
32nd Floor
New York, New York 10019
Attention: William R. Campbell, Esq,
Telecopy No.: (212) 326-8772
A Partner may change its address by giving notice in writing, stating its new
address, to the other Partners. Notice to a Partner, if made in the manner
provided above, shall be effective upon receipt by the addressee named therein.
10.2 Law Governing. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
10.3 Amendments. This Agreement may not be amended or modified except by a
written instrument executed by all of the Partners.
10.4 Successors and Assigns. Subject to the provisions of Article 4, this
Agreement, and all the terms and provisions hereof, shall be binding upon and
shall inure to the benefit of the Partners, and their respective legal
representatives, successors and permitted assigns.
10.5 Counterparts. This Agreement shall be executed in multiple
counterparts, each of which shall be considered an original but all of which
shall constitute one agreement.
10.6 Gender and Number. Whenever required by the context, as used in this
Agreement, the singular number shall include the plural, and the masculine
gender shall include the feminine or the neuter.
10.7 Severabillty. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be invalid or unenforceable, the remainder of this Agreement and the application
of such provision to other persons or circumstances shall not be affected
thereby,
25
<PAGE>
but rather shall be enforced to the greatest extent permitted by
law.
10.8 Headings. The headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation
thereof.
10.9 References. Any reference to an "Article" or to a "Section" contained
in this Agreement shall be to a provision of this Agreement, unless such
provision specifically provides otherwise.
10.10 Payment of Legal Fees. Except as otherwise provided herein, the
Partnership will pay all legal expenses incurred by the Partners and their
respective Affiliates in connection with the preparation and execution of this
Agreement.
10.11 Time of the Essense. Time is of the essence with this Aqreement.
[REST OF PAGE INTENTIONALRY LEFT BLANR]
26
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Parenership Agreement on the Execution Date but effective as of the Effective
Date.
RCP:
----
RCP MANAGEMENT LP, a Texas limited
Partnership
By: AIRCRAFT SPARE PARTS, INC., a
Delaware corporation, its
General Partner
By: /s/ Robert Albert
---------------------------
Robert Albert, Chairman
J/T:
----
J/T AVIATION PARTNERS, a general partnership
By: TM AVIATION (USA) INC., a
Delaware corporation, general partner
By: /s/ T. Yoshida
---------------------------
Name: T. Yoshida
Title: President
By: TM AVIATION (JAPAN) INC., a
Delaware corporation, general partner
By: /s/ T. Yoshida
---------------------------
Name: T. Yoshida
Title: President
By: JAPAN FLEET SERVICE (DELAWARE)
INC., a Delaware corporation,
general partner
By: /s/ Tim L. Watkins
---------------------------
Tim L. Watkins, President
27
<PAGE>
SCHEDULES:
1.1(d) - Description of AIS Assumed Liabilities
1.1(e) - Description of AIS Contributed Assets
1.1(f) - Description of AIS Retained Assts
1.1(g) - Description of AIS Retained Liabilities
28
<PAGE>
SCHEDULE 1.1(d)
Description of AIS Assumed Liabilities
The obligations created by that certain Loan and Security Agreement dated
February 28, 1992, executed by the Partnership and Congress Financial
Corporation and the documents executed in connection therewith
The obligations created by that certain Loan and Security Agreement dated
February 28, 1992, executed by the Partnership and Tomen America Inc. and the
documents executed in connection therewith
$7,000,000 subordinated Term Promissory Note payable to Tomen America Inc. and
Japan Fleet Service (Europe) B.V.
$200,000 Subordinated Promissory Note dated Deeember 9, 1993, payable to RCP
Management L.P. and J/T Aviatian Partners
$200,000 Subordinated Promissory Note dated January 7, 1994, payable to ROP
Management L.P. and J/T Aviation Partners
$600,000 Subordinated Promissory Note dated May 12, 1994, payable to ROP
Management L.P. and J/T Aviation Partners
$52,000 Subordinated Promissory Note dated August 22, 1994, payable to RCP
Management L.P.
$48,000 Subordinated Promissory Note dated August 22, 1994, payable to J/T
Aviation Partners
$1,040,000 Subordinated Promissory Note dated July 14, 1994, payable to ROP
Management L.P
$960,000 Subordinated Promissory Note dated July 14, 1994, payable to J/T
Aviation Partners
$411,364 Subordinated Promissory Note dated June 30, 1994, payable to RCP
Management L.P.
$75,400 subordinated Promissory Note dated August 22, 1994, payable to RCP
Management L.P.
$69,600 subordinated Promissory Note dated August 22, 1994, payable to J/T
Aviation Partners
$582,400 Subordinated Promissory Note dated October 31, 1994, payable to RCP
Management L.P.
$537,600 Subordinated Promissory Note dated October 31, 1994, payable to J/T
Aviation Partners
JFS reimbursements owed pursuant to the Restated Partnership
<PAGE>
Agreement of AJT Capital Partners
Management Fees owed to Aircraft Spare Parts, Inc, pursuant to the Management
Agreement dated February 28, 1992 between the Partnership and Aircraft Spare
Parts. Inc.
Open Vouchers by Vendor for the period ending November 30, 1994, prepared by the
Partnership, a copy of which is located at the offices of Boyar, Simon & Miller,
P.C., in Houston. Texas.
<PAGE>
SCHEDULE 1.1(e)
Description of AIS Contributing Assets
Inventory:
Inventory described in that certain inventory listing with a Materials
Certification dated November 30, 1994, executed by the Partnership in favor of
ASC.
Motor Vehicles:
1993 Jeep 4 Door, VIN No. lJ4GZ78S2PC512767, LIcense No. HWM37B
1992 Ford Van, VIN No. 1FTCA14USNZA80007, License No. BY0918
1981 Ford PK, VIN No. lFTDFl0E5BNA37195, License No. FJ6728
1992 Ford Wagon, VIN No. 1FMDA31X2NZA38212, License No. HKT05R
Other Fixed Assets:
Fixed assets described in that certain Property and Equipment Tracking
Report for the period ending November 30, 1994, prepared by the Partnership, a
copy of which is in the offices of Bryan, Simon & Miller. P.C., in Houston,
Texas.
List of Assigned Agreements:
Leases with Crow/Griggs I Limited Partnership for the following Properties in
Harris County, Texas::
6000 Griggs Road
Houston, Texas 77023
6002-A Griggs Road
Houston, Texas 77023
Lease with Officia et alia. Corp., d/b/a HQ Business Centers, a Washington
corporation, for sales office in Bellevue, Washington
Repair agreements with the following parties:
BF Goodrich Aerospace (open items)
Component Overhaul & Repair, Inc,
817 Dessau Road
Austin, Texas 78753-971O
<PAGE>
Caribe Aviation, Inc.
(open items) 2200 N.W. 84th Avenue
Miami, Florida 33122
Menasco Overhaul Division (L-1011 landing gear)
____________________________
____________________________
Consignment agreements with the following party:
American Technical Suppliers, Inc. (consignee)
2529 N.W. 74 Avenue
Miami, Florida 33122
Iberia Lineas Aereas de Espana, S.A. (consignee)
____________________________
____________________________
JFS (consignor) (verbal agreement only)
____________________________
____________________________
Exchange pool agreements with the following parties:
Valuejet Airlines, Inc,
1800 Phoenix Boulevard, Suite 126
Atlanta, Georgia 30349
Vanguard Airlines, Inc.
Main Office:
4121 West 83rd, Suite 101
Prairie Village, Kansas 66208
Inventory Location:
31 Rome Circle
Midcontinental Airport
Kansas City, Missouri 6O153
Exchange agreement with the following party:
AAR (A-300 Landing Gear)
____________________________
____________________________
Equipment lease agreements with the follovlng parties:
XL/Datacomp, Inc.
906 North Elm Street
Hinsdale, Illinois 6052l
<PAGE>
Ramco Stock option Agreement dated February 28, 1992, by and between the
Partnership, as the purchaser, and Ramco American International, Inc., a New
Jersey corporation ("Ramco"), and the shareholders of Ramco, as the sellers,
relating to an option to purchase fifty-six percent (56%) of the issued and
outstanding capital stock of Ramco
$7,875,000 Promissory Note executed by Ramco American International, Inc., a New
Jersey corporation, payable to the order of the Partnership, together with all
liens securing same
$19,903.46 Promissory Note obtained in connection with collection of account
receivable dated December 28, 1993, executed by Avtrade Corporation, payable to
the order of the Partnership
$44,408.17 Promissory Note obtained in connection with collection of account
receivable dated May 7, 1993, executed by Shield Aviation Inc., payable to the
order of the Partnership
Account Receivable:
Open Accounts Receivable Aging Detail Report of November 30, 1994, prepared
by the Partnership, a copy of which is in the office of Boyar, Simon & Miller,
P.C., in Houston, Texas.
<PAGE>
SCHEDULE 1.1(f)
Description of AIS Retained Assets
Sales representative agreements with the following parties:
International Air of Palau
Number 70 Price Boulevard
London. Arizona 72847
PFR Aircraft Support, Ltd.
Unit 5
Barratt Industrial Estate
Spittslesea Road
London
Luton International Airport
Luton, Beds
LU2, 9NZ
England
TWH Aviation
73, Mishmeret St.
Tel-Aviv 69012
Israel
Aircraft equipment general terms agreement with the following party:
Alitalia-Linee Aeree Italiana S.P.A.
Via della Magliana, 886
00148 Roma Italy
All of the Partnership's rights, titles and interests in and to the following
tract of real property located in Brazoria County, Texas, and described on
Exhibit "A" attached hereto.
<PAGE>
EXHIBIT "A"
-----------
METES AND BOUNDS DESCRIPTION
9.5360 ACRES OUT OF LOT 77 & 78
ZYCHLINSKI SUBDIVISION
PEARLAND, BRAZORIA COUNTY, TEXAS
All that certain 9.5360 acres out of Lots 77 & 78 of the Zychlinski Subdivision
according to the plat recorded in Vol. 29, Pg. 43 Brazoria County Deed Records,
Abstract 542 and being more particularly described by metes and bounds as
follows:
Beginning at a found 1" iron pipe marking a point from which the original
northwest corner of that certain called 5.00 acre tract described in a deed
dated 6/17/1987 from Pearland Investment Co. to Harry E. Bradley filed in Vol.
433, Pg. 86 Brazoria County Official Records, bears N 00(degree) 01' 30" -
40.00' and from which the intersection of the south right-of-way line of Knapp
Road and the east right-of-way line of North Main Street (Texas Highway 35)
bears N 89(degree) 54' 34" W - 972.32' and being on the south right-of-way line
of Knapp Road (90' wide);
Thence S 89(degree) 54' 34" E - 354.49' with the south right-of-way line of
Knapp road as established by that certain right-of-way deed filed in Vol. 1379
Pg. 48 Brazoria County Deed Records to a set 5/8" iron rod and marking the
northwest corner of that certain 4.8584 acre tract as described in a deed dated
6/17/1987 from Pearland Investment Co. to Harry E. Bradley filed in Vol. 433,
Pg. 86 Brazoria County Official Records; from which the common north corner of
said Lots 77 & 78 bears N 00(degree) 01' 30" E - 40.00';
Thence East continuing with the south right-of-way line of Knapp Road (90'
wide), passing a call and found 5/8" iron rod at 450.02' and continuing a total
distance of 839.93' to a call and found 1/2" iron rod marking the northeast
corner of said 4.8584 acre tract;
Thence South - 96.05' with the west line of that certain Tract "C" as described
in a deed dated 2/28/1979 from Frank A. Touisinau, Trustee to City of Pearland
filed in Vol. 1447, Pg. 287 Brazoria County Deed Records to a point for corner
marking the southeast corner of said 4.8584 acre tract and being in the bed of
an existing ditch commonly known as Hickory Slough, from which a call and found
1/2" iron rod marking the southwest corner of said Tract "C" bears South 38.56'
(called 38.95');
Thence West - 50.00' with the south line of said 4.8584 acres to a set 5/8" iron
rod for angle point;
<PAGE>
Thence S 69(degree) 46' 00" W - 565.14' continuing with the south line of said
4.8584 acre tract to a set 5/8" iron rod marking the point of curvature of a
curve to the left having a radius of 283.66' a central angle of 31(degree) 30'
00";
Thence with said curve and continuing with the south line of said 4.8584 acre
tract an arc distance of 155.95' to the point of tangency from which a set 5/8"
iron rod for reference point bears N 40(degree) 26' 54" W - 40.25';
Thence S 38(degree) 16' 00" W - 218.46' continuing with the south line of said
4.8584 acre tract to a point for corner being in the east line of said called
5.00 acre tract;
Thence S 00(degree) 01' 30" W - 21.00' with the east line of said called 5.00
tract to a set 5/8" iron rod for corner marking the southeast corner of said
5.00 acre tract;
Thence West - 354.49' with the south line of said 5.00 acre tract to a call and
found 1" iron pipe for corner;
Thence N 00(degree) 01' 30" E - 575.06' with the east line of that certain 2.00
acre tract as described in a deed dated 5/20/1986 from R.L. Delhomme to
Manhattan Building Co. filed in Vol. 283, Pg. 158 Brazoria County Deed Records
to the POINT OF BEGINNING and containing 9.5360 acres (415,389 square feet) of
land more or less.
Compiled by:
C.L. Davis & Company
Land Surveying
Job No. 11-185
December 17, 1991
[SEAL]
STATE OF TEXAS
REGISTERED
C.L. DAVIS
4464 /S/ C.L. DAVIS
PROFESSIONAL
LAND SURVEYOR
<PAGE>
SCHEDULE 1.1 (g)
Description of AIS Retained Liabilities
Martin R. Shugrue, Jr.. Trustee for the Estate of Eastern, Air Lines. Inc. v.
Aviation Rotables Acquisition Corp. and AJT Capital Partners, pending in the
United States Bankruptcy Court for the Southern District of New York, Adversary
Proceeding No. 93-9174A.
Martin R. Shugrue, Jr., Trustee for the Estate of Eastern Air Lines. Inc v.
American Aviation Suppliers, Inc. v. Aviation Rotables Acquisition Corp., and
AJT Capital Partners, pending in the United States District Court for the
southern District of Florida, Case No. 93-0602-CIV-FERGUSON.
Silvia Estrada and Imelda Estrada v. Aircraft Spare Parts. Inc. f/k/a Aerospace
International Services, Inc., pending in the United Staten District Court for
the Southern District of Texas, Galveston Division, Case No. G-93-843.
AGREEMENT TO DISSOLVE PARTNERSHIP
(AJT Capital Partners)
This AGREEMENT TO DISSOLVE PARTNERSHIP (the "Agreement") is entered
effective as of the 26th day of June, 1996 (the "Effective Date"), by and
between RCP MANAGEMENT L.P., a Texas limited partnership ("RCP"), and J/T
AVIATION PARTNERS, a Delaware general partnership ("J/T") (RCP and J/T are
sometimes hereinafter collectively referred to as the "Partners").
W I T N E S S E T H:
WHEREAS, RCP and J/T are the sole partners of AJT CAPITAL PARTNERS, a
Delaware general partnership (the "Partnership");
WHEREAS, the Amended and Restated Partnership Agreement of AJT Capital
Partners (the "Partnership Agreement"), permits the Partnership to be dissolved
pursuant to the unanimous consent of the partners of the Partnership; and
WHEREAS, the Partners desire to dissolve the Partnership.
NOW, THEREFORE, in consideration of the premises and the agreements
contained herein, the parties hereby agree as follows:
1. Dissolution of Partnership. The Partners hereby agree that as of the
Effective Date, the Partnership shall be dissolved.
2. Additional Documents. The Partners hereby agree to take whatever steps
are reasonably necessary and to execute such additional documents necessary to
dissolve and cancel the Partnership and the Partnership Agreement, including
without limitation, the filing of cancellations of all assumed name certificates
filed with respect to the Partnership.
3. Miscellaneous.
(a) This Agreement shall be governed and constructed in accordance with the
laws of the State of Delaware. The provisions hereof shall be binding upon and
inure to the benefit of the Partners and their respective successors,
representatives and assigns.
(b) This Agreement merges all prior negotiations and agreements between the
parties relating to the subject matter hereof and constitutes the entire
agreement between the parties relating to such subject matter. No prior or
contemporaneous agreements, written or oral, relating to such subject matter
shall be binding.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
EXECUTED effective as of the Effective Date.
RCP:
RCP MANAGEMENT L.P., a Texas limited
partnership
By: Aircraft Spare Parts,
Delaware corporation,
Partner
By: /s/ Robert Alpert
--------------------------------
Robert Alpert, Chairman
J/T:
J/T AVIATION PARTNERS, a Delaware
general partnership
By: Japan Fleet Service (Delaware) Inc.,
a Delaware corporation, General
Partner
By: /s/ Tim L. Watkins
--------------------------------
Tim L. Watkins, President
By: TM Aviation (Japan) Inc., a
Delaware corporation, General
Partner
By: /s/ K. Okui
------------------------------------
Name: K. Okui
Title: President
Signature Page to Agreement to Dissolve Partnership
(AJT Capital Partners)
-2-
<PAGE>
By: TM Aviation (USA) Inc., a
Delaware corporation, General
Partner
By: /s/ T. Yoshida
------------------------------------
Name: T. Yoshida
Title: President
Signature Page to Agreement to Dissolve Partnership
(AJT Capital Partners)
-3-
1-5
<PAGE>
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f) under the Securities
Exchange Act of 1934, as amended, the persons named below agree to the joint
filing on behalf of each of them of the Schedule 13D to which this Agreement
is an exhibit (and any further amendment filed by them) with respect to the
shares of Common Stock, $.001 par value, of Aviation Sales Company.
This agreement may be executed simultaneously in any number
of counterparts, all of which together shall constitute one and the same
instrument.
Dated: July 3, 1996
J/T AVIATION PARTNERS
By: JAPAN FLEET SERVICE (DELAWARE) INC.,
General Partner
For J/T Aviation Partners and as a Reporting
Person
By: /s/ Tim L. Watkins
-----------------------------------------
Name: Tim L. Watkins
Title: President
By: TM AVIATION (JAPAN) INC., General Partner
For J/T Aviation Partners and as a Reporting
Person
By: /s/ K. Okui
-----------------------------------------
Name: K. Okui
Title: President
By: TM AVIATION (USA) INC., General Partner
For J/T Aviation Partners and as a Reporting
Person
By: /s/ T. Yoshida
-----------------------------------------
Name: T. Yoshida
Title: President
TOMEN CORPORATION
By: /s/ K. Okui
-----------------------------------------------
Name:
Title:
NY1-148262.5
<PAGE>
JAPAN FLEET SERVICE (Europe) B.V.
By: /s/ Tim L. Watkins
-----------------------------------------
Name: Tim L. Watkins
Title: Director
JAPAN FLEET SERVICE (Singapore) Pte. Ltd.
By: /s/ Tim L. Watkins
-----------------------------------------
Name: Tim L. Watkins
Title: Managing Director
NY1-148262.5
