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testCS-BC 1000 (06-10) Page 1 of 1 Allianz Global Corporate & Specialty Aviation Broad Coverage Insurance Policy Prepared for: Named Insured & Address Arranged by: Broker Underwriting Office and Claims Reporting: Allianz Global Corporate & Specialty - Aviation 3399 Peachtree Rd NE Suite 1625 Atlanta, Georgia 30326 404.760.7800

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testCS-BC 1000 (06-10) Page 1 of 1

Allianz Global Corporate & Specialty

Aviation Broad Coverage Insurance Policy

Prepared for: Named Insured & Address

Arranged by: Broker

Underwriting Office and Claims Reporting: Allianz Global Corporate & Specialty - Aviation 3399 Peachtree Rd NE

Suite 1625 Atlanta, Georgia 30326 404.760.7800

AGCS-BC 1200 (09-09) Page 1 of 7

This policy is issued by: Allianz Global Risks US Insurance Company 225 W. Washington Street, Suite 1800 Chicago, IL 60606-3484 Producer: Broker

AVIATION BROAD COVERAGE INSURANCE POLICY DECLARATIONS

Policy Number Previous Policy Number

This policy and any endorsements attached constitute the Aircraft Broad Coverage Insurance Policy, issued by Allianz Global Risks US Insurance Company (hereinafter called the Company).

ITEM 1. Named Insured: Named Insured & Address

ITEM 2. Address:

ITEM 3. Policy Period: From: Until:

At 12:01 AM standard time at the Named Insured’s address shown in ITEM 2. above.

ITEM 4. Pilots:

This Pilot Warranty ITEM 4., shall not apply to Liability Coverage for Non-Owned Aircraft and Temporary Substitute Aircraft. In addition, the pilot warranty shown above shall not apply while the insured aircraft are in the care, custody or control of a Federal Aviation Administration approved Repair Station for the purpose of maintenance, repair or test flights.

ITEM 5. Policy Premium: $ Taxes/Surcharges: $ Mexican Insurance $ Total: $

ITEM 6. Forms and Endorsements attached to this policy as of the effective date:

Endorsements 1 -

AGCS-BC 1200 (09-09) Page 2 of 7

PART 1 - LIABILITY COVERAGES AND LIMITS

The limit of the Company’s liability provided for each coverage in PART 1 shall not exceed:

Coverage 1: Scheduled Aircraft

Reg. Number Limit of Liability

$ Each Occurrence Bodily Injury and Property Damage Including Passengers

$ Each Occurrence Bodily Injury and Property Damage Including Passengers

$ Each Occurrence Bodily Injury and Property Damage Including Passengers

$ Each Occurrence Bodily Injury and Property Damage Including Passengers

$ Each Occurrence Bodily Injury and Property Damage Including Passengers

Coverage 2: Passenger Voluntary Settlement

A) Settlement Limit with respect to any Scheduled Aircraft or Temporary Substitute Aircraft:

$ Each Non-Crewmember Passenger in any one Occurrence.

$ Each Crewmember in any one Occurrence.

As respects a Scheduled Aircraft, the total for all Crewmember and Non-Crewmember Passengers combined in any one Occurrence shall be the Settlement Limit(s) multiplied by the number of Crewmember and/or Non-Crewmember Passenger seats for the aircraft as shown in Coverage 13. of these Declarations.

As respects a Temporary Substitute Aircraft, the total for all Crewmember and Non-Crewmember Passengers combined in any one Occurrence shall be the Settlement Limit(s) multiplied by the number of Crewmember and/or Non-Crewmember Passenger seats for a Schedule Aircraft with the most similar seating capacity as shown in Coverage 13. of these Declarations.

B) Settlement Limit with respect to any Non-Owned Aircraft except a Temporary Substitute Aircraft:

$ Each Non-Crewmember Passenger in any one Occurrence.

$ Each Crewmember in any one Occurrence.

$ Total all Non-Owned Aircraft Crewmembers and Non-Crewmember Passengers combined in any one Occurrence.

C) $ is the Maximum Weekly Indemnity Limit for each Passenger.

D) 52 consecutive weeks is the Maximum Indemnity Period.

These limits are part of, and not in addition to, the limit provided for Coverage 1 or 3, whichever applies to the loss.

AGCS-BC 1200 (09-09) Page 3 of 7

Coverage 3: Use of Non-Owned Aircraft

$ Each Occurrence.

The Maximum Number of Seats is 40.

The Reporting Grace Period is 30 consecutive days.

Coverage 4: Property Damage to Non-Owned Aircraft, Temporary Substitute Aircraft and Hangarkeeper’s Legal Liability

$ Each Occurrence as respects Property Damage other than Hangarkeeper’s Legal Liability.

$ Each Aircraft, as respects Hangarkeeper's Legal Liability, $ Each Occurrence, subject to deductibles of $ Each Aircraft, $ Each Occurrence.

These limits are part of and not in addition to the limit provided for Coverage 3.

Coverage 5: Property Damage Liability for Hangars and Their Contents

$ Each Occurrence.

These limits are part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

Coverage 6: Premises Operations

$ Each Occurrence for other than Property Damage to an Auto, operation of Mobile Equipment and Mechanics Tools and Fire Damage to Real Property.

$ Each Occurrence for the operation of Mobile Equipment.

$ Each Occurrence for Property Damage to an Auto, and limited to $ Any One Auto, subject to a deductible of $ Each Auto.

$ Each Occurrence for operation of an Auto while on Airport Premises.

$ Each Occurrence for Fire damage to Real Property.

$ Each Occurrence as respects mechanic’s tools and limited to $ Each Mechanic and subject to a deductible of $250 Each Mechanic.

The limits for Coverage 6 are part of and not in addition to the limits of liability shown in Coverage 1 or 3 above, whichever applies.

Coverage 7: Sale of Aircraft and Aircraft Products and Services

$ Each Occurrence and in the annual aggregate.

AGCS-BC 1200 (09-09) Page 4 of 7

Coverage 8: Serving of Alcoholic Beverages

$ Each Occurrence.

These limits are part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

Coverage 9: Contractual Agreements

$ Each Occurrence.

These limits are part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

Coverage 10: Personal Injury:

$25,000,000 Each Offense and in the annual aggregate.

This limit is part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

Coverage 11: Cargo

$ Each Occurrence, subject to a deductible of $1,000 Each Occurrence.

This limit is part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

Coverage 12: Incidental Medical Malpractice

$ Each Occurrence.

This limit is part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

PART 2- DEFENSE, SETTLEMENT AND SUPPLEMENTARY PAYMENTS OF LIABILITY CLAIMS

See page 7 of form, AGCS-BC 1400 (12-06).

AGCS-BC 1200 (09-09) Page 5 of 7

PART 3 - PHYSICAL DAMAGE COVERAGE AND LIMITS

Coverage 13: Physical Damage to Scheduled Aircraft

Deductibles

In-Motion/ Reg. Year Seats Insured Not In- lngestion/ Number Make & Model Built Crew. / Pass. Value Motion Moored

$ $ $

$ $ $

$ $ $

$ $ $

$ $ $

Coverage 14: Physical Damage to Spare Engines and Spare Parts

$ Each loss subject to deductibles of:

$ Each loss while not In Motion.

$ Each loss while In Motion/Ingestion/Moored.

Coverage 15: Automatic Increased Value of Scheduled Aircraft or Spare Engines and Spare Parts

$ Is the Maximum Automatic Physical Damage limit for any one Scheduled Aircraft without prior approval of the Company.

$ Is the Maximum automatic limit for all Spare Engines and Spare Parts without prior approval of the Company.

AGCS-BC 1200 (09-09) Page 6 of 7

PART 4 - ADDITIONAL COVERAGES AND LIMITS

Coverage 16: Temporary Replacement Parts Rental Expense

$ Each Loss for no more than the maximum coverage period of 60 consecutive days.

The Minimum required repair period is 5 days

Coverage 17: Replacement Aircraft Rental Expense

$ Each Loss for no more than a maximum coverage period of 60 consecutive days.

The Minimum required repair period is 5 days.

Coverage 18: Search and Rescue Expenses

$ Each Loss.

Coverage 19: Runway Foaming and Crash Control Expenses

$ Each Loss.

Coverage 20: Trip Interruption Expense

$ Each Non-Crewmember and Crewmember Passenger /Each Loss.

Coverage 21: Automatic Insurance for Newly Acquired Aircraft

$ The Maximum Physical Damage Limit for any one Aircraft.

Coverage 22: Lay-Up Credit for Scheduled Aircraft

A pro-rated return of 50% of the in-Flight hull and liability excluding War premium upon notice of the lay-up period's termination if the Scheduled Aircraft is laid up for 30 or more consecutive days.

Coverage 23: Personal Effects and Baggage

$ Each Non-Crewmember and Crewmember Passenger.

Coverage 24: Liability for Charter Referral

$ Each Occurrence.

This limit is part of and not in addition to the limit provided for Coverage 1 or 3, whichever applies to the loss.

AGCS-BC 1200 (09-09) Page 7 of 7

PART 5 - MEDICAL EXPENSES AND LIMITS

Coverage 25: Medical Payments

A) With respect to any Scheduled Aircraft or Temporary Substitute Aircraft:

$ Each Person in any one accident.

B) With respect to any Non-Owned Aircraft except a Temporary Substitute Aircraft:

$ Each Person other than a Crewmember in any one accident.

$ Each Crewmember in any one accident.

Coverage 26: Premises Medical Payments

$ Each Person in any one accident and subject to a total of

$ for all Medical Payments in any one accident.

THESE DECLARATIONS, TOGETHER WITH THE COMMON POLICY CONDITIONS AND COVERAGE FORM(S) AND ANY ENDORSEMENT(S), COMPLETE THE ABOVE NUMBERED POLICY. In Witness Whereof, we have caused this policy to be executed and attested.

Secretary President

International Flight Operations Notice

Although this policy provides coverage in Mexico, the Mexican Government (DGAC) may require proof of aircraft

liability written through a Mexican insurance company. Mexican liability coverage is available through the Company, if needed. Other countries may require special evidences of coverage and/or have advance notification requirements. The aircraft operator should familiarize itself with any such requirements and advise its insurance broker of any special needs well in advance of flight. The aircraft along with its crew and passengers may be delayed or detained if proper evidence of insurance coverage cannot be provided.

AGCS-BC 1400 (12-06) Page 1 of 19

TABLE OF CONTENTS

PART 1 - LIABILITY COVERAGES .................................................................................................................................. 3 Coverage 1 - Scheduled Aircraft ................................................................................................................................... 3 Coverage 2 - Passenger Voluntary Settlements for Scheduled and Non-Owned Aircraft.............................................................................................................................................................. 3 Coverage 3 - Use of Non-Owned Aircraft ...................................................................................................................... 4 Coverage 4 - Property Damage to Non-Owned Aircraft, Temporary Substitute Aircraft and Hangarkeeper's Legal Liability ................................................................................................... 4 Coverage 5 - Property Damage to Hangars and Their Contents .................................................................................... 4 Coverage 6 - Premises Operations ............................................................................................................................... 4 Coverage 7 - Sale of Aircraft and Aircraft Products and Services................................................................................... 5 Coverage 8 - Serving of Alcoholic Beverages................................................................................................................ 5 Coverage 9 - Contractual Agreements .......................................................................................................................... 5 Coverage 10 - Personal Injury....................................................................................................................................... 6 Coverage 11 - Cargo .................................................................................................................................................... 6 Coverage 12 - Incidental Medical Malpractice ............................................................................................................... 6

PART 2 - DEFENSE, SETTLEMENT AND SUPPLEMENTARY PAYMENTS OF LIABILITY CLAIMS ............................... 7 PART 3 - PHYSICAL DAMAGE COVERAGES................................................................................................................. 7

Coverage 13 - Physical Damage to Scheduled Aircraft.................................................................................................. 7 Coverage 14 - Physical Damage to Spare Engines and Spare Parts ............................................................................. 7 Coverage 15 - Automatic Increased Value of Scheduled Aircraft or Spare Engines and Spare Parts .............................................................................................................................................. 7

PART 4 - ADDITIONAL COVERAGES ............................................................................................................................. 8 Coverage 16 - Temporary Replacement Parts Rental Expense ..................................................................................... 8 Coverage 17 - Replacement Aircraft Rental Expense.................................................................................................... 8 Coverage 18 - Search and Rescue Expense................................................................................................................. 8 Coverage 19 - Runway Foaming and Crash Control Expense ....................................................................................... 8 Coverage 20 - Trip Interruption Expense....................................................................................................................... 8 Coverage 21 - Automatic Insurance for Newly Acquired Aircraft .................................................................................... 8 Coverage 22 - Lay-Up Credit For Scheduled Aircraft ..................................................................................................... 9 Coverage 23 - Personal Effects and Baggage Expense ................................................................................................ 9 Coverage 24 - Liability Coverage for Charter Referral ................................................................................................... 9

AGCS-BC 1400 (12-06) Page 2 of 19

PART 5 - MEDICAL EXPENSES...................................................................................................................................... 9 Coverage 25 - Medical Payments for Scheduled and Non-Owned Aircraft..................................................................... 9 Coverage 26 - Premises Medical Payments .................................................................................................................. 9

PART 6 - POLICY DEFINITIONS ................................................................................................................................... 10 PART 7 - EXCLUSIONS................................................................................................................................................. 12 PART 8 - LIMIT OF THE COMPANY’S LIABILITY.......................................................................................................... 15

Other Insurance.......................................................................................................................................................... 16 Total Liability for PART 1 - Liability Coverages ............................................................................................................ 16 Total Liability for PART 3 - Physical Damage Coverages ............................................................................................ 16 Total Liability for PART 4 - Additional Coverages ........................................................................................................ 17 Severability of Interests............................................................................................................................................... 17 Two or More Aircraft Insured by this Policy.................................................................................................................. 17

PART 9 - NOTICE OF CLAIMS AND OTHER DUTIES OF AN INSURED....................................................................... 17 PART 10 - OTHER CONDITIONS OF INSURANCE....................................................................................................... 18

Changing the Policy .................................................................................................................................................... 18 Inspection................................................................................................................................................................... 18 The Company’s Rights of Recovery ............................................................................................................................ 18 This Policy Conforms to State Law.............................................................................................................................. 18 Transfer of the Policy to Others................................................................................................................................... 18 Cancellation and Non-Renewal of this Policy .............................................................................................................. 18 Financial Responsibility Laws ..................................................................................................................................... 18 Action Against the Company....................................................................................................................................... 18 Cross Liability ............................................................................................................................................................. 19 Certificates of Insurance ............................................................................................................................................. 19 Representations and Entire Agreement....................................................................................................................... 19 Violation of Statute...................................................................................................................................................... 19

AGCS-BC 1400 (12-06) Page 3 of 19

The Company agrees with the Named Insured, with respect to those coverages shown in the Declarations, subject to the terms of this policy, in return for the payment of premium, and in reliance upon statements in the application, as follows:

PART 1 - LIABILITY COVERAGES

Coverage 1 - Scheduled Aircraft

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Bodily Injury and Property Damage, caused by an Occurrence during the policy period, arising out of the ownership, maintenance, or use of a Scheduled Aircraft.

Coverage 2 - Passenger Voluntary Settlements for Scheduled and Non-Owned Aircraft

As used in this Coverage 2:

"Settlement Limit" means the maximum applicable limit the Company will pay to or for each Passenger as shown in the Declarations under Coverage 2.

"Totally Disabled" means the complete and continuous inability to perform each and every of the job duties pertaining to one’s occupation, or any occupation for which the injured Passenger is qualified by way of education, experience, training, or prior earnings.

"Body Part" means a hand, foot or eye.

"Loss" of a “Body Part” means severance of a hand at or above the wrist, severance of a foot at or above the ankle, or the entire and irrecoverable loss of sight in an eye.

"Permanent Total Disability" means that the injured Passenger has been continuously “Totally Disabled” for a period of twelve months and will remain so disabled for the remainder of his lifetime.

With respect to Bodily Injury meeting the criteria described in paragraphs 1., 2., and 3. below, and subject to the “Settlement Limits” applicable thereto, the Company will, regardless of legal liability and without admitting to the liability of anyone, offer to pay on behalf of the Insured the sum requested by the Named Insured to or for the benefit of each covered Passenger who sustains Bodily Injury caused by an Occurrence during the policy period arising out of the ownership, maintenance or use of a Scheduled Aircraft or the use of Non-Owned Aircraft by or on behalf of the Insured:

1. if the Bodily Injury, directly and independently of all other causes, results in the death or “permanent total disability” of the Passenger, the Company will offer to pay up to the “Settlement Limit”;

2. if the Bodily Injury, directly and independently of all other causes, results in the “Loss” of two or more

“Body Parts”, the Company will offer to pay up to the “Settlement Limit”;

3. if the Bodily Injury, directly and independently of all other causes, results in the “Loss” of one “Body Part”, the Company will offer to pay up to one-half of the “Settlement Limit,”

4. provided that the Named Insured has requested the Company make a payment offer within one (1) year following the date of the Occurrence.

If Bodily Injury meeting the criteria described in paragraphs 1., 2., or 3. above directly and independently of all other causes results in the Passenger’s becoming “totally disabled”, the Company will reimburse the Named Insured for payments the Named Insured chooses to make to the injured Passenger for the loss of earnings as a result of the disability. The Company’s liability in connection with such payments shall not exceed the lesser of (a) eighty percent (80%) of the average weekly wage of that Passenger or (b) the Maximum Weekly Indemnity Limit shown in the Declarations under Coverage 2. Such payments for loss of earnings will be made for the period of continuous total disability up to the maximum indemnity period shown in the Declarations under Coverage 2. The “Settlement Limit” will be reduced by the amount of any payments that are made under this paragraph.

With respect to any payments made under this Coverage 2, it is a condition of payment that the recipient of such payments, or the recipient’s legal representative, will, upon request, authorize the Company to obtain medical reports and copies of records and that the injured person will submit to physical examination by physicians selected by the Company when the Company may reasonably require.

With respect to any payments made under paragraphs 1., 2., or 3. above, it is a condition of payment that the injured person, and any others with potential claims arising from the injury, executes a full release, in a form approved by the Company, for all Bodily Injury claims by or on their behalf against any Insured and the Company.

If a payment offer under this Coverage 2 is rejected or not accepted within 120 days, or if a suit for Bodily Injury against any Insured is filed at any time by or on behalf of a Passenger to whom this coverage applies, Coverage 2 will not apply to or for the benefit of that Passenger.

Coverage 2 will not apply to or for the benefit of any Crewmembers on any Non-Owned Aircraft unless the Declarations include a specified Settlement Limit with respect to any Non-Owned Aircraft for Crewmembers and such Crewmembers either (a) are professional pilots who are regular employees of the Insured, acting in their capacity as such, or (b) would normally be operating a Scheduled Aircraft, but are operating a Non-Owned Aircraft on behalf of the Insured.

AGCS-BC 1400 (12-06) Page 4 of 19

Applicable To Both Coverages 3 and 4

For these coverage parts, “insured" means:

a) with respect to a Temporary Substitute Aircraft, the same as Insured;

b) with respect to any other Non-Owned Aircraft, the Named Insured and any director, executive officer, employee, partner, or agent of the Named Insured, if such person is acting in that capacity at the time of the loss.

Regardless of Paragraphs a) and b) above, no entity or person is an “insured” while using an aircraft that such entity or person owns in whole or in part, or as to which such entity or person holds a lease purchase option, or that is registered to that entity or person or to any member of such person’s household.

Coverage 3 - Use of Non-Owned Aircraft

The Company will pay on behalf of the “insured,” as defined above for purposes of this Coverage 3, all sums that the “insured” becomes legally obligated to pay as damages, because of Bodily Injury and Property Damage caused by an Occurrence during the policy period, arising out of the use of Non-Owned Aircraft by or on behalf of the “insured.”

Coverage 4 - Property Damage to Non-Owned Aircraft, Temporary Substitute Aircraft and Hangarkeeper's Legal Liability

The Company will pay on behalf of the “insured,” as defined above for purposes of this Coverage 4, all sums that the “insured” becomes legally obligated to pay as damages arising out of Property Damage, caused by a loss during the policy period, to Non-Owned Aircraft, Temporary Substitute Aircraft, or any transient aircraft while temporarily at the “insured's” airport premises. This coverage section will not apply while the Aircraft is In-Flight unless the Aircraft is operated by a person employed as a professional pilot who is acting in that capacity at the time of the loss.

Conditions Applicable To Both Coverages 3 and 4

1. The insurance provided by Coverages 3 and 4 does not apply to claims or losses arising out of an “insured's” product liability hazard or out of any products designed, manufactured, sold, distributed, serviced, or handled by or on behalf of an “insured.”

2. When the Insurance Department of the Named Insured is advised of the exclusive lease or use of any Non-Owned Aircraft for a period exceeding the "reporting grace period" shown in the Declarations, it shall report such lease or use to the Company. The

Company may charge an additional premium for this lease or use. Unintentional failure to comply with this reporting requirement will not void this coverage, provided that the Named Insured advises the Company as soon as possible after the failure to report is discovered.

3. The insurance provided by Coverages 3 and 4 is secondary and Excess Insurance to any other insurance available to the Insured covering the loss.

Coverage 5 - Property Damage to Hangars and Their Contents

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay for Property Damage, caused by an Occurrence during the policy period, to hangars not owned by any Insured and to the contents (not owned by any Insured) of such hangars resulting from Aviation Operations of the Named Insured.

This insurance provided by Coverage 5 is secondary and Excess Insurance to any other insurance available to the Insured covering the loss. In addition, such coverage does not apply to any loss or damage to property otherwise covered by this policy.

Coverage 6 - Premises Operations

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Bodily Injury and Property Damage, caused by an Occurrence during the policy period:

A. arising out of the ownership, maintenance, or use of Premises or Mobile Equipment,

B. arising out of the ownership, lease, rental, arrangement for or use of Autos while on airport Premises, not including public roadways or parking areas,

C. because of Property Damage to an Auto occurring while that Auto is in the care, custody or control of the Insured for valet parking, towing, safekeeping, storage or while on airport Premises for any other incidental use by the Insured. This coverage shall not apply to:

1. the Insured’s liability under any agreement to be responsible for direct and accidental loss of or damage to an Auto;

2. Property Damage or damage to an Auto or parts of any Auto:

a. owned by, leased to, rented to or loaned to the Insured;

b. owned by, leased to, rented to or loaned to an officer or employee of the Insured unless the Auto is in the Insured’s custody due to towing, or for valet

AGCS-BC 1400 (12-06) Page 5 of 19

parking for which a charge has been made;

c. theft or conversion caused in any way by the Insured.

D. arising out of Property Damage to structures, or portions thereof, rented to or leased to the Named Insured, including permanently attached fixtures, if such Property Damage arises out of fire. This coverage shall not apply to any liability assumed under any contract or agreement.

E. arising out of direct and accidental physical loss or damage from external causes to the tools of the Insured’s employee mechanics while such tools are in the care, custody and control of the Named Insured or such mechanic while acting within the scope of their duties. This coverage shall not apply to:

1. wear, tear, deterioration, rust, or inherent vice,

2. mechanical, electrical, hydraulic, pneumatic or structure breakdown or failure,

3. artificial electrical current or magnetism,

4. delay, depreciation, or loss of use,

5. mysterious disappearance, loss or shortage disclosed upon taking inventory,

6. temperature or humidity extremes,

7. wrongful taking or secretion by any person or organization in lawful possession thereof,

8. infidelity, dishonesty of the Insured or anyone in the service of the Insured,

9. failure to save or to protect such property from further loss or harm after an Occurrence to which this coverage applies.

The insurance provided by Coverage 6 is secondary and Excess Insurance over any other insurance available to the Insured covering the loss.

Coverage 7 - Sale of Aircraft and Aircraft Products and Services

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Bodily Injury and Property Damage, caused by an Occurrence during the policy period, arising out of:

1. the Named Insured’s sale (or relinquishment from an exclusive written lease) of a Scheduled Aircraft or any aircraft sold or relinquished prior to the policy period, or

2. the Insured’s provision to others, without intentionally profiting therefrom, of any materials,

parts, equipment, fuel, or maintenance services used for or in connection with Aircraft, Premises, or Mobile Equipment, or

3. the Insured’s provision to others, without intentionally profiting therefrom, of food or beverages in connection with the operation of Aircraft or Premises.

This insurance provided by Coverage 7 is secondary and Excess Insurance of any other insurance available to the Insured covering the loss. In addition, such coverage applies only if the Bodily Injury or Property Damage occurs away from the Insured's premises, the Insured no longer has physical possession of the Aircraft, materials, parts, equipment, fuel, food, or beverages, and any services provided by the Insured have been completed.

Coverage 8 - Serving of Alcoholic Beverages

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Bodily Injury and Property Damage, caused by an Occurrence during the policy period, arising out of the serving or giving of any alcoholic beverage at or from the Insured's Premises or upon any Aircraft covered by this policy. This coverage shall not apply if the Insured is in the business of manufacturing, furnishing, distributing or serving alcohol to others.

This insurance provided by Coverage 8 is secondary and Excess Insurance to any other insurance available to the Insured covering the loss.

Coverage 9 - Contractual Agreements

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Bodily Injury and Property Damage, caused by an Occurrence during the policy period, arising out of liability assumed by the Named Insured or its legal representative in a contract or agreement relating to the Insured’s ownership, maintenance, or use of Scheduled Aircraft or to the Insured’s use of Non-Owned Aircraft.

The Company's Rights of Recovery (as shown in Part 10 of this policy) with respect to Physical Damage of property covered by this policy will not apply to the extent that such rights are addressed in a contract or agreement entered into by the Named Insured or its legal representative.

This Coverage 9 applies only to contracts and agreements that first have been submitted to, and accepted by, the Company. A copy of any such contract or agreement must be submitted to the Company as soon as possible after it comes to the attention of the Named Insured’s Insurance Department. Unintentional failure to comply with this submission requirement will not void the insurance provided by this section, provided that the Named Insured advises the Company as soon

AGCS-BC 1400 (12-06) Page 6 of 19

as possible after the failure to make the submission is discovered. The Company may charge an additional premium for any such contract or agreement as may be agreed with the Named Insured.

Submission and acceptance is not required with respect to temporary aircraft storage agreements, minor servicing agreements, military or governmental agreements for the use of an airport, lease of premises agreements, or agreements already submitted to and accepted by the Company prior to the effective date of this policy.

This Coverage 9 does not apply to any liability assumed:

1. under an oral contract or agreement, other than a contract or agreement that a military or governmental body requires in order for the Insured to be allowed the use of an airport, or that relates to temporary storage or minor servicing of a Scheduled Aircraft while it is away from its home base;

2. under a written contract or agreement:

a) that is with or for the benefit of any Passenger or Crewmember or the heirs of such Passenger or Crewmember. This paragraph 2. a) does not apply:

i) if the contract or agreement is required by a military or governmental body in order for the Insured to be allowed the use of an airport, or

ii) to coverage provided by Paragraph 1. of Coverage 9 above;

b) that pertains to “major alterations” or “major repairs” as those terms are defined in the Federal Aviation Regulations;

c) that is with or for the benefit of any manufacturer of aircraft or of aircraft parts or equipment, or with or for the benefit of such manufacturer’s employees or agents, to the extent that the written contract or agreement relates to their products liability hazard;

d) that relates to the sale of an aircraft;

e) that relates to a loss and is entered into after that loss has already occurred.

Coverage 10 - Personal Injury

The Company will promptly pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay as damages because of Personal Injury, caused by an offense during the policy period, arising out of the ownership, maintenance, or use of covered Aircraft or premises.

This Coverage 10 does not apply to offenses arising out of or relating to:

1. willful violation of a criminal statute or ordinance, committed by or with the consent of the Insured or

2. any type of hiring, termination, or other employment practices.

Coverage 11 - Cargo

The Company will pay on behalf of the Insured all sums that the Insured becomes legally obligated to pay for the loss of or Physical Damage to the property of others (minus any applicable deductible) while such property is in the Insured’s care, custody and control on a covered Aircraft, or while such property is in the Insured’s care, custody, and control on its airport premises prior to loading on, or after unloading from, a covered Aircraft.

This Coverage 11 does not apply to loss, damage, or claim caused by:

1. loss of market or loss arising out of delay, whether or not the delay is caused by an Occurrence,

2. consequential loss of any kind,

3. infidelity of the Insured or of the Insured’s employees or agents,

4. wear, tear, deterioration, extremes of temperature or pressure, or any loss arising out of the perishable or hazardous nature of the property,

5. destruction of, or damage to, manuscripts, notes, checks, securities, accounts, bills, deeds, or any valuable papers in excess of their actual reproduction costs,

6. loss of or damage to any Passenger’s personal effects or baggage.

This insurance provided by Coverage 11 is Secondary and Excess Insurance to any other insurance available to the Insured covering the loss.

Coverage 12 - Incidental Medical Malpractice

The Company will pay on behalf of the Insured all sums which the Insured becomes legally obligated to pay as damages because of Bodily Injury during the policy period arising out of “Incidental Medical Malpractice.”

“Incidental Medical Malpractice” means injury arising out of the rendering of or failure to render medical, surgical, dental, x-ray, use of automatic external defibrillator, or nursing service or treatment or the furnishing of food or beverage in connection therewith, or the furnishing or dispensing of drugs or dental, medical or surgical supplies or appliances.

This insurance provided by Coverage 12 shall not apply to:

A. expenses incurred by the Insured for first-aid to others at the time of an accident,

B. any insured engaged in the business or occupation of providing any of the services

AGCS-BC 1400 (12-06) Page 7 of 19

described under “Incidental Medical Malpractice,”

C. injury caused by any indemnitee if such indemnitee is engaged in the business or occupation of providing any of the services described under “Incidental Medical Malpractice,”

D. the failure to render automatic external defibrillator treatment if the Aircraft or Premises are not equipped with such devices.

PART 2 - DEFENSE, SETTLEMENT AND SUPPLEMENTARY PAYMENTS OF

LIABILITY CLAIMS

The Company shall have the right and duty to defend any suit against the Insured seeking damages because of Bodily Injury, Personal Injury, or Property Damage covered by this policy, even if the allegations of such suit are false, fraudulent, or groundless. The Company may make any investigation and settlement of any claim or suit that it believes to be expedient. The Company shall not be obligated to pay any expense, claim, or judgment or to defend any suit after the applicable limit of liability has been exhausted by the payment of judgments or settlements.

The Company will pay, in addition to the applicable limit of liability:

1. all the Company’s expenses, all costs taxed against the Insured in any suit the Company is required to defend, and:

a) pre-judgment interest awarded against the Insured on that part of a judgment the Company is required to pay under the terms of this policy,

b) interest on the amount of any judgment that the Company is required to pay under the terms of this policy that accrues after the entry of the judgment and before the Company has paid, offered to pay, or deposited in court the part of the judgment that is within the applicable limit of insurance, and

c) costs of any required or permissible arbitration with respect to any claim that alleges damages covered by this policy;

2. premiums on required appeal bonds or on bonds to release or prevent attachments in any suit defended by the Company, provided, however, that the Company has no obligation to pay premiums on the portion of any such bond that exceeds the applicable limit of liability, and provided further that the Company has no obligation to furnish or apply for any such bonds,

3. the cost of bail bonds, up to $10,000. for each incident, required of the Insured because of an

Occurrence or a law or regulation relating to civil aviation arising out of the use of aircraft or premises, provided, however, that the Company has no obligation to furnish or apply for any such bonds,

4. expenses incurred by the Insured for emergency first aid or other medical and surgical relief that is rendered at the time of an Occurrence because of Bodily Injury covered by this policy,

5. all reasonable expenses incurred by the Insured at the Company’s request or that have been approved in advance by the Company provided, however, that the Company will not pay more than $500.00 per day for each of the Insured’s employees for the loss of earnings.

PART 3 - PHYSICAL DAMAGE COVERAGES

Coverage 13 - Physical Damage to Scheduled Aircraft

The Company will pay (minus any applicable deductible) for Physical Damage to a Scheduled Aircraft including ingestion and also including disappearance or theft thereof that happens during the policy period and results in no recovery of the Scheduled Aircraft for thirty (30) days. Furthermore, if an unexpected event causes a Scheduled Aircraft to make a landing at a location from which it cannot safely depart, and regardless of whether the Scheduled Aircraft sustains Physical Damage, the Company will pay the reasonable costs of transporting the Scheduled Aircraft and its occupants to the nearest appropriate airport.

Coverage 14 - Physical Damage to Spare Engines and Spare Parts

The Company will pay for Physical Damage to or theft of Spare Engines and Spare Parts (minus any applicable deductible) that are owned by the Named Insured or for which the Named Insured is legally responsible, so long as such Physical Damage or theft happens during the policy period.

The insurance provided by this Coverage 14 is secondary and Excess Insurance to any other insurance available to the Insured covering the loss.

Coverage 15 - Automatic Increased Value of Scheduled Aircraft or Spare Engines and Spare Parts

If, during the policy period and as a result of modifications or the installation of additional equipment, the value of a Scheduled Aircraft increases, or if, during the policy period, the Named Insured modifies or acquires additional Spare Engines or Spare Parts, the applicable insurance provided under PART 3 - PHYSICAL DAMAGE COVERAGES will apply to the increased value of the Scheduled Aircraft and/or the

AGCS-BC 1400 (12-06) Page 8 of 19

value of the additional Spare Engines or Spare Parts. The limits of insurance in the Declarations will automatically increase in an amount corresponding to the actual cost to the Named Insured of the modifications, additional equipment, or additional Spare Engines or Spare Parts as evidenced by the Named Insured’s records, provided that:

1. the Named Insured advises the Company of any such increase in value as soon as possible after completion of the modifications, additions, or acquisitions;

2. unless the Company has agreed otherwise in advance, the maximum automatic increase of value will not exceed the Maximum Automatic Physical Damage limit for a Scheduled Aircraft shown in the Declarations under this Coverage or the Maximum Automatic Limit for Spare Engines and Spare Parts shown in the Declarations under this coverage, whichever applies;

3. the Named Insured pays any additional premiums for the increased limits.

PART 4 - ADDITIONAL COVERAGES

Coverage 16 - Temporary Replacement Parts Rental Expense

If a Scheduled Aircraft suffers Physical Damage covered by this policy, the Company will pay additional expenses actually incurred by the Named Insured for renting or leasing temporary replacement component part(s) to replace, for the period of repair, the part(s) damaged in the loss, including the Named Insured’s cost of installation, removal, and transportation, provided, however, that this Coverage 16 shall apply only if the actual time required for the repair exceeds the “minimum required repair period” shown for this coverage in the Declarations.

Coverage 17 - Replacement Aircraft Rental Expense

If a Scheduled Aircraft suffers a Physical Damage loss covered under this policy, and the Named Insured leases or rents a temporary replacement aircraft while the Scheduled Aircraft is being repaired, the Company will pay that portion of the actual cost incurred by the Named Insured of leasing or renting a replacement aircraft over and above the cost the Named Insured would have incurred in operating the Scheduled Aircraft if it had not been damaged.

This Coverage section does not apply:

1. unless the actual time required to repair the damaged Aircraft exceeds the “minimum required repair period” shown under this Coverage 17 in the Declarations, or

2. if another aircraft is available at no extra charge for its use, or

3. if the Named Insured acquires a permanent replacement for the damaged aircraft through ownership, lease, option, or otherwise, or

4. if the Scheduled Aircraft is a Total Loss and the Company has offered the Named Insured a proof of loss, or

5. beyond the “maximum coverage period” for this Coverage 17 as shown in the Declarations; or

6. for replacement of an Aircraft to provide FAR Part 135 Air Taxi Service to others.

Coverage 18 - Search and Rescue Expense

The Company will reimburse the Insured for expenses actually incurred by the Insured for search and rescue operations that are performed by or at the request of the Named Insured and which have had prior approval of the Company. The coverage provided by this Coverage 18 will not apply to any claim, cost, or expense:

1. for governmental or military search and rescue efforts;

2. that arises out of loss or damage to any equipment used in connection with search and rescue efforts;

3. that arises out of injury to or death of any persons involved in the search and rescue efforts;

4. that is incurred after it is reasonably assumed that there are no survivors; or

5. that is associated with salvage of the aircraft or any other property.

Coverage 19 - Runway Foaming and Crash Control Expense

The Company will reimburse the Insured for expenses actually incurred by the Insured for runway foaming or for fire, crash control, or rescue operations, where such expenses are incurred in order to reduce Physical Damage or Bodily Injury covered by this policy.

Coverage 20 - Trip Interruption Expense

The Company will reimburse the Insured for the reasonable expenses actually incurred by the Insured in providing food, transportation, and lodging to Passengers who must be transported from the place where an Aircraft suffers covered Physical Damage either to the damaged aircraft’s intended final destination or, if the trip is discontinued, to the place where the Passengers originally boarded the Aircraft.

Coverage 21 - Automatic Insurance for Newly Acquired Aircraft

If, during the policy period, the Named Insured becomes the owner of an aircraft in addition to the

AGCS-BC 1400 (12-06) Page 9 of 19

Scheduled Aircraft, or becomes the exclusive lessee of such additional aircraft and is required by lease to provide this insurance, and if the Named Insured reports such acquisition or lease to the Company as soon as reasonably possible, then the insurance afforded by this policy will apply to the additional aircraft at the time of transfer of ownership or upon the effective date of the lease. Unless otherwise agreed in writing by the Named Insured and the Company, the coverages and limits of liability applicable to the additional aircraft will be the same as those coverages and limits that are provided for the Scheduled Aircraft. The Insured Value of the additional aircraft will be the actual cost of the aircraft to the Named Insured or, in the case of a leased aircraft, the fair market value of the aircraft, but such Insured Value in no event shall exceed the “Maximum Physical Damage Limit” shown under Coverage 21 as shown in the Declarations for an Aircraft most similar to the newly acquired Aircraft and further subject to a maximum Insured Value of $75,000,000.00. The Named Insured agrees to pay any required additional premium because of the addition of the newly acquired aircraft.

Coverage 22 - Lay-Up Credit For Scheduled Aircraft

If, as a result of its maintenance, inspection, servicing, alterations, repair, or intended sale, a Scheduled Aircraft is not In-Flight for more than the minimum lay-up period shown in the Declarations, the Named Insured agrees to notify the Company as soon as possible. At the end of the policy period, the Company will return a pro-rata percentage of the applicable premium, as shown in the Declarations, corresponding to the entire period of the lay-up. This section will not apply to any Scheduled Aircraft laid up because of loss or damage covered by this policy.

Coverage 23 - Personal Effects and Baggage Expense

The Company will pay the Named Insured for all sums for which the Named Insured is liable, or that the Named Insured pays to others, as a result of loss of or Physical Damage, during the policy period, to a Passenger’s personal effects or baggage. This section does not apply unless the personal effects or baggage were in the care, custody, or control of an Insured at the time of damage or loss.

Coverage 24 - Liability Coverage for Charter Referral

The Company will pay on behalf of the Named Insured all sums the Named Insured becomes legally obligated to pay as damages because of bodily injury or property damage caused by an Occurrence that arises out of the Named Insured’s referral for charter of a Non-Owned Aircraft by or on behalf of another person or organization.

PART 5 - MEDICAL EXPENSES

Coverage 25 - Medical Payments for Scheduled and Non-Owned Aircraft

The Company will pay all reasonable medical expenses incurred, within one year following the date of injury, by a covered Passenger who sustains Bodily Injury caused by an Occurrence during the policy period. This provision applies without regard to legal liability for such injury.

This Coverage 25 does not apply to or for the benefit of a Crewmember on Non-Owned Aircraft unless the Declarations show a specific limit for Crewmembers under the “Non-Owned Aircraft” section of Coverage 25 and the Crewmember:

1. is an officer, director, stockholder, employee, partner, or agent of the Named Insured while acting in his or her capacity as such, or

2. would normally be operating a Scheduled Aircraft but is operating a Non-Owned Aircraft on behalf of the Named Insured.

Coverage 26 - Premises Medical Payments

The Company will pay all reasonable Medical Expenses incurred, within one year following the date of injury, by each person who sustains Bodily Injury caused by an Occurrence during the policy period and arising out of the Named Insured’s ownership, maintenance or use of premises. This provision applies without regard to legal liability for such injury.

Conditions Applicable to Both Coverages 25 and 26

1. As soon as practicable after request, the injured person or a person acting on the injured person’s behalf will provide written proof of claim to the Company. Such proof of claim shall be provided under oath. The injured person or his or her representative will authorize the Company to obtain medical reports and copies of records. The injured person will submit to physical examination by physicians selected by the Company as the Company may reasonably require.

2. The Company may pay the injured person or any person or organization rendering the medical services. Payments made under these sections do not constitute an admission of liability of the Company or of any person or organization.

3. The total liability of the Company for all Medical Expenses incurred by or on behalf of each covered Passenger or person who sustains Bodily Injury is limited to the limit of liability stated in the Declarations for that Passenger or person.

AGCS-BC 1400 (12-06) Page 10 of 19

PART 6 - POLICY DEFINITIONS

When appearing in bold face print in this policy the following definitions apply:

“Aircraft” means any Scheduled Aircraft and any other aircraft for which insurance is provided under this policy. The definition includes the aircraft’s propulsion system as well as all parts and equipment that are installed in or on the aircraft. Parts that are temporarily removed are, even if replaced, also included in the definition. Also included in the definition are tools and repair equipment standard for and normally carried on the aircraft.

“Auto” means a land motor vehicle, trailer or semi-trailer designed for travel on public roads, including any attached machinery or equipment. Auto excludes Mobile Equipment.

“Aviation Operations” means operations arising from the ownership, maintenance or use of locations or Aircraft for aviation activities including that portion of roads and access points that adjoin these locations. Aviation operations include all operations necessary or incidental to aviation activities.

“Bodily Injury” means physical injury sustained by any person, caused by an Occurrence during the policy period, including sickness, disease, mental anguish, and death at any time resulting therefrom. Mental anguish does not include Personal Injury.

“Crewmember” means any Passenger such as the Pilot In Command, co-pilot, flight engineer, or flight attendant, who is required for, or assists in, aircraft operations at the time of a loss.

“Excess Insurance” means insurance that only applies when all other valid and collectible insurance, including any formal self-insurance program or self-insured retention plan, available to the Insured has been exhausted (other than insurance that is specifically purchased by the Named Insured to apply as excess over this policy). If the other insurance is written through the Company as primary insurance, the total limit of the Company’s liability will not exceed the limit of whichever policy has the highest limit.

“Federal Aviation Administration (FAA)” means the duly constituted authority of the United States of America having jurisdiction over civil aviation in the United States of America or its duly constituted equivalent in any other country.

“In-Flight” means, with respect to fixed-wing aircraft, the time commencing from the start of the take-off run of the aircraft and continuing until it has completed its landing roll. With respect to rotorcraft, it means any time the rotors are moving under power for lift-off or flight, until the rotors cease moving after landing. With respect to any other aircraft, it is any time the aircraft is off a supporting surface as a result of propulsion, buoyancy, or aerodynamic reaction.

“In-Motion” means any time an aircraft is moving under its own power, is moving as a result of the momentum generated by its own power, or is In-Flight or moored. With respect to rotorcraft, it is any time the rotors are moving under power or are moving as a result of the momentum generated by the rotorcraft’s own power.

“Ingestion” means Physical Damage to turbine engines or turbine auxiliary power units, if they are included within the definition of Aircraft, caused by objects or substances that are not or were not part of the engine or its accessories, as shown in the manufacturer’s parts list for the engine, which damage is the result of a single incident that requires (or would require if its severity were known at the time) immediate repair before further use.

“Insured” means:

1. for all coverages:

a) the Named Insured and

b) any director, officer, partner, employee, agent, or stockholder of the Named Insured while that person is acting within his or her official capacity as such.

2. for all PART 1 – Liability Coverages except Coverages 3, 4, and 7 (Non-Owned Aircraft Liability Coverages and Products Liability Coverages):

a) any person or organization while riding in, using, or legally responsible for a Scheduled Aircraft or Temporary Substitute Aircraft, provided that the use is within the scope of the permission granted by the Named Insured;

b) any other person or organization, but only for such person’s or organization’s legal liability that is covered by this policy and arises solely out of the acts or omissions of a person or organization in Paragraph 1. above.

3. Other than any persons or organizations described in Paragraph 1. above, none of the following is considered an Insured regardless of Paragraph 2. a) above:

a) any person or organization, or any agent or employee thereof, that is engaged in the design, manufacture, maintenance, repair, or sale of aircraft, aircraft engines, components, or accessories, or that is engaged in the operation of any aircraft, airport, hangar, flight school, flight service, or piloting service, with respect to any Occurrence arising out of such activity, or

b) the owner or lessor, or any agent or employee thereof, of any Non-Owned Aircraft covered by this policy.

“Insured Value” means the amount shown under Coverage 13 of PART 3- PHYSICAL DAMAGE COVERAGE AND LIMITS

AGCS-BC 1400 (12-06) Page 11 of 19

“Medical Expense” means expenses for necessary medical, surgical, x-ray, and dental services, including prosthetic devices and necessary ambulance, hospital, professional nursing, and funeral services.

“Mobile Equipment” means a land vehicle (including any machinery or apparatus attached), whether or not self-propelled, that is used in connection with the maintenance or operation of aircraft or premises and that:

1. is not subject to motor vehicle registration, or

2. is used exclusively on premises owned by or rented to the Named Insured including the roadways or property immediately adjoining such premises, or

3. is designed for use principally off public roads.

“Named Insured” means the person(s) or organizations(s) shown in ITEM 1. of the Declarations.

“Non-Owned Aircraft” means any aircraft except:

1. an aircraft owned in whole or in part by or registered to the Named Insured,

2. a Scheduled Aircraft, or

3. an aircraft having a seating configuration exceeding the “maximum number of seats” shown in the Declarations for Coverage 3 (regardless of the actual number of Passengers on the aircraft).

4. an aircraft being operated under Part 121 of the Federal Aviation Regulations or any foreign equivalent thereof, or any airline or scheduled operations as a common carrier.

“Occurrence” means an accident, including continuous or repeated exposure to conditions, that results in Bodily Injury or Property Damage neither expected nor intended by the Insured. However, the definition will include Bodily Injury or Property Damage resulting from efforts to prevent dangerous interference with any covered aircraft operations.

“Partial Loss” means any Physical Damage loss that is not a Total Loss.

“Passenger” means any person in, on, or boarding the Aircraft for the purpose of riding in, flying, or exiting from it after a ride, flight, or attempted flight.

“Personal Injury” means any of the following offenses committed during the policy period:

1. false arrest, detention, or imprisonment,

2. malicious prosecution,

3. wrongful entry or eviction,

4. invasion of the right of private occupancy,

5. libel or slander, except if the libel or slander is committed with the insured’s consent and known by the Insured to be false, or,

6. any negligent act, error or omission committed, or alleged to have been committed, in an advertisement, publicity article, broadcast or telecast and arising out of the Named Insured’s aviation advertising activities, that results or allegedly results in:

a) infringement of copyright, title or slogan,

b) piracy or plagiarism,

c) unfair competition,

d) misrepresentation under an implied contract, or

e) an invasion of a right of privacy.

“Physical Damage” means accidental, direct physical loss of or damage to Scheduled Aircraft, Spare Engines, or Spare Parts during the policy period, but it does not include the loss of use or any residual depreciation in value either before or after any repairs have been made.

“Pilot In Command” means the pilot aboard the aircraft who is responsible for its In-Flight operation.

“Premises” means the portions of airports, buildings, or areas used by the Named Insured directly in connection with the ownership, operation, maintenance, or use of any Aircraft.

“Property Damage” means accidental damage to or destruction of the tangible property of others during the policy period caused by an Occurrence during the policy period and the resultant loss of use of the property. Property Damage also includes the loss of use of the tangible property of others that is not physically damaged but that is caused by an Occurrence during the policy period.

“Salvage Value” means the value of the damaged property prior to any repairs.

“Scheduled Aircraft” means any aircraft listed under Coverage 1 of Part 1 of the Declarations – for Scheduled Aircraft in the Declarations or any aircraft covered under Coverage 21 – Automatic Insurance for Newly Acquired Aircraft.

“Spare Engines” means propulsion engines and auxiliary power units that have been, or that are intended to be, installed in or on a Scheduled Aircraft or a Temporary Substitute Aircraft and that are not included within the policy definition of an Aircraft.

“Spare Parts” means parts or accessories, except Spare Engines, specifically designed for installation in or on aircraft or Mobile Equipment, that are not included within the policy definition of an Aircraft or Mobile Equipment.

“Temporary Substitute Aircraft” means any Non-Owned Aircraft used in place of a Scheduled Aircraft that is temporarily withdrawn from use because of its damage, breakdown, repair, modification, inspection, servicing, loss, or destruction.

AGCS-BC 1400 (12-06) Page 12 of 19

“Total Loss” means any Physical Damage loss for which the cost to repair, when added to the salvage value, equals or exceeds:

a) the Insured Value of a Scheduled Aircraft, or

b) the actual cash value of any other insured property.

Theft of the property or disappearance of the entire aircraft for more than thirty (30) days shall be considered a total loss.

PART 7 - EXCLUSIONS

This policy does not apply:

1. under any Coverage Part:

a) to liability assumed by the Insured in any type of agreement except as provided by Coverage 9 – Contractual Agreements;

b) to any obligation for which the Insured or its insurance carrier may be held liable under any workers’ compensation, unemployment compensation, or disability benefits law or under any similar law;

c) to Bodily Injury or Personal Injury to any employee of the Insured arising out of and in the course of his or her employment by the Insured, or to any claims for Bodily Injury as a consequence thereof. This exclusion does not apply to Coverage 2 – Passenger Voluntary Settlements, or to liability assumed by the Insured in any agreement required by a military or governmental authority as a prerequisite to the Insured’s use of an airport or airport facility;

d) to any Insured while the aircraft is In-Flight and being piloted by someone other than the pilot or pilots designated in the Declarations.

e) to Bodily Injury, Property Damage, loss, or destruction of or damage to any property whatsoever or any loss or expense whatsoever, any consequential loss, or any legal liability of whatsoever nature directly or indirectly caused by, contributed to, or resulting or arising from:

1) The radioactive, toxic, explosive, or other hazardous properties of any explosive nuclear assembly or nuclear component thereof;

2) The radioactive properties of, or a combination of radioactive properties with toxic, explosive, or other hazardous properties of, any other radioactive material in the course of carriage as cargo, including storage or handling incidental thereto;

3) Ionizing radiations or contamination by radioactivity from, or the toxic, explosive, or

other hazardous properties of any other radioactive source whatsoever.

It is understood and agreed that such radioactive material or other radioactive source in exclusion 1. e) 2) or 3). above shall not include:

4) Depleted Uranium and natural Uranium in any form;

5) Radioisotopes that have reached the final stage of fabrication so as to be useable for any scientific, medical, agricultural, commer-cial, educational, or industrial purpose.

Loss, destruction, damage, expenses, or legal liability in respect of the nuclear risks not excluded by reason of exclusion 1. e), 2) or 3) shall (subject to all other terms, conditions, limitations, warranties, and exclusions of this policy) be covered, provided as follows

6) In the case of any claim in respect of radioactive material in the course of carriage as cargo, including storage or handling incidental thereof, such carriage shall in all respects have complied with the full International Civil Aviation Organization “Technical Instructions for the Safe Transport of Dangerous Goods by Air,” unless the carriage shall have been subject to any more restrictive legislation, when it shall in all respects have complied with such legislation.

7) This policy shall only apply to an incident happening during the policy period and where any claim by the Insured against the Company or by any claimant against the Insured arising out of such incident shall have been made within three (3) years after the date thereof.

8) In the case of any claim for the loss of or destruction to or loss of use of an aircraft caused by or contributed to by radioactive contamination, the level of such contamination shall have exceeded the maximum permissible level set out in the following scale.

Emitter

(IAEA Health and Safety Regulations)

Beta, gamma and low toxicity alpha emitters

All other alpha emitters

Maximum permissible level of non-fixed radioactive surface contamination

(Averaged over 300 cm2)

Not exceeding 4 Becquerels/cm2 (10-4 microcuries/cm2)

Not exceeding 0.4 Becquerels/cm2

(10-5 microcuries/cm2)

AGCS-BC 1400 (12-06) Page 13 of 19

9) The coverage afforded by this exclusion e) may be cancelled at any time by the Company giving seven (7) days notice of cancellation.

10) This policy, however, does not cover loss of or destruction of or damage to any property or any consequential loss or any legal liability of whatsoever nature with respect to which:

(a) the Insured under this policy is also an Insured or an additional Insured under any other insurance policy, including any nuclear energy liability policy;

(b) any person or organization is required to maintain financial protection pursuant to legislation in any country;

(c) the Insured under this policy is, or had this policy not been issued would be, entitled to indemnification from any government or agency thereof.

f) to claims caused by any of the following:

1) war, invasion, acts of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, martial law, military or usurped power, or attempts at usurpation of power,

2) any hostile:

(a) detonation of any device employing atomic or nuclear fission and/or fusion or other like reaction and any radioactive contamination and electromagnetic pulse resulting directly from such detonation, or

(b) use of radioactive contamination or matter, or

3) strikes, riots, civil commotions, or labor disturbances;

4) any act of one or more persons, whether or not agents of a sovereign power, for political or terrorist purposes and whether the loss or damage resulting therefrom is accidental or intentional;

5) any malicious act or act of sabotage;

6) confiscation, nationalization, seizure, restraint, detention, appropriation, or requisition for title or use by or under the order of any government (whether civil, military or de facto) or public or local authority;

7) hijacking or any unlawful seizure or wrongful exercise of control of the Aircraft or crew in flight (including any attempt at such seizure or control) made by any person or persons

on board the Aircraft acting without the consent of the Insured. For the purpose of this exclusion 1. f) only, an aircraft is considered to be in flight at any time from the moment when all its external doors are closed following embarkation until the moment when any such door is opened for disembarkation or when the aircraft is in motion. A rotor-wing aircraft shall be deemed to be in flight when the rotors are in motion as a result of engine power, the momentum generated therefrom, or autorotation.

8) claims arising while the Aircraft is outside the control of the Insured by reason of any of the above perils. The Aircraft shall be deemed to have been restored to the control of the Insured on the safe return of the Aircraft to the Insured at an airfield not excluded by the geographical limits of this Policy, and entirely suitable for the operation of the Aircraft (such safe return shall require that the Aircraft be parked with engines shut down and under no duress).

g) to claims for the following:

1) any liability, including liability arising out of or assumed under contract, or any injury, loss, or damage, including, but not limited to, fear of any injury, loss, or damage, Bodily Injury, fear of Bodily Injury, Personal Injury, advertising injury, sickness, disease, occupational disease, disability, shock, death, mental anguish, mental injury, Property Damage, or any loss, cost or expense, loss of use including grounding, or any other claim, cost, or expense, including any costs associated with medical monitoring in connection with injury, loss, or damage, or fear of injury, loss, or damage whatsoever directly or indirectly arising out of, resulting from, caused or occasioned by, happening through, in consequence of, or in any way involving or related to asbestos or the use of or exposure to asbestos, including the failure of any product or material containing asbestos, or the existence or presence of asbestos in any place or thing or in the atmosphere, land, or any watercourse or body of water;

2) any damages or any loss, cost, or expense arising out of any claim or suit by or on behalf of any governmental authority or any other allegedly responsible party or any request, demand, order, or statutory or regulatory requirement that any Insured or any other person or entity should be or is responsible for:

AGCS-BC 1400 (12-06) Page 14 of 19

(a) assessing the presence, absence, amount, or effects of asbestos,

(b) identifying, sampling, testing for, detect-ing, monitoring, cleaning up, containing, treating, detoxifying, neutralizing, abat-ing, disposing of, mitigating, or removing asbestos or any product or material containing asbestos,

(c) responding to asbestos or the potential effects of asbestos in any way other than as described in subparagraph 2) a) or b) above or

(d) any supervision, instructions, recom-mendations, warnings, or advice given or that should have been given in connection with paragraphs 2) (a), (b), or (c) of this Exclusion.

This exclusion g) shall not apply to any claim for bodily injury or property damage resulting from a crash, fire, explosion or collision of aircraft, or from a recorded in-flight emergency causing abnormal Aircraft operation.

h) to any liability including liability arising out of or assumed under contract, or any injury, loss, or damage, including Bodily Injury, fear of Bodily Injury damage, or fear of damage, personal injury, advertising injury, sickness, disease, occupational disease, disability, shock, death, mental anguish, mental injury, Property Damage, or any loss, cost or expense, loss of use including grounding, or any other claim, cost or expense whatsoever, directly or indirectly arising out of, resulting from, caused or occasioned by, happening through, in consequence of, or in any way involving any of the following:

1) noise (whether audible to the human ear or not), vibration, sonic boom, and any phenomena associated with the foregoing,

2) pollution or contamination of any kind whatsoever, or the exposure to pollution or contamination, or the fear of exposure to or the effects of pollution or contamination or the existence of pollution or contamination in any place or thing or in the atmosphere, land, or any watercourse or body of water, as well as any claim or suit by or on behalf of or any direction, demand or request or any statutory or regulatory requirement, or any voluntary decision, by or on behalf of any governmental authority or other alleged responsible party, that any Insured or others test for, monitor, clean up, remove, contain, treat, detoxify, neutralize or in any way respond to or assess the effects of pollutants or contaminants,

3) electrical or electromagnetic emission or interference of any kind whatsoever,

4) interference with the use of property, or

5) mold.

For purposes of this Exclusion the following definitions apply:

“Pollution or contamination” means any actual, alleged or threatened discharge, dispersal, release, escape, seepage, migration, disposal, or the mere presence of pollutants or contaminants in any form.

“Pollutants or contaminants” means any pollutant, contaminant, or irritant, including, without limitation, any solid, liquid, gaseous, or thermal pollutant, contaminant, or irritant, or any air emission, smoke, vapor, soot, fume, acid, alkali, chemical, or nuclear material alleged to be a possible or probable carcinogenic, odor, oil or other petroleum product, fungus (including mold or mildew or any mycotoxin, spore, scent, or byproduct produced or released by fungi, other than any fungi intended by the Insured for human consumption), or “waste” of any kind whatsoever, including solid waste, waste water, waste oil, infectious medical waste, and human, animal or vegetable waste.

“Waste” means any waste including material to be recycled, reconditioned, or reclaimed, whether or not the material has been disposed of by the Insured or any person handling the waste.

With respect to any provision in the policy concerning any duty of the Company to investigate or defend claims, such provision shall not apply and the Company shall not be required to defend claims excluded by this exclusion h).

A claim or claims covered by the policy, when combined with any claims excluded by this Exclusion h) are referred to below as “Combined Claims.”

In respect of any “Combined Claims”, the Company shall (subject to proof of loss and the limits of the policy) reimburse the Insured for that portion of damages awarded against the Insured, plus defense fees and expenses incurred by the Insured, which may be allocated to the claim or claims covered by the policy.

This exclusion h) shall not apply to any claim for bodily injury or property damage resulting from a crash, fire, explosion or collision of aircraft, or from a recorded in-flight emergency causing abnormal Aircraft operation.

i) to any claim for Property Damage, Bodily Injury, loss, cost, expense or liability (whether in contract, tort, negligence, product liability, misrepresentation, fraud, or otherwise) of any nature whatsoever arising from, occasioned by, or in consequence of (whether directly or indirectly and whether wholly or partly):

AGCS-BC 1400 (12-06) Page 15 of 19

1) any actual or alleged failure, malfunction or inadequacy of:

(a) any of the following, whether belonging to any Insured or to others, whether or not part of any computer system or whether in the possession of the Insured or of any third party:

(1) computer hardware, including microprocessors,

(2) computer application software,

(3) computer operating systems and related software,

(4) computer networks,

(5) microprocessors, computer chips, or integrated circuits or other information technology equipment or systems.

(b) any other products or systems and any services, data, or functions that directly or indirectly use or rely upon, in any manner, any of the items listed in paragraph 1) (a). of this exclusion;

due to the inability to correctly recognize, process, distinguish, interpret or accept:

(1) the change of year from 1999 to 2000;

(2) the change of date from August 21, 1999 to August 22, 1999;

(3) any other change of year, date or time;

However, this Exclusion 1., i), 1) shall not apply to any sums which the Insured shall become legally liable to pay as damages because of Bodily Injury or physical injury to or destruction of tangible property resulting from a covered Occurrence.

2) any advice, consultation, design, evaluation, inspection, installation, maintenance, repair, replacement or supervision provided or done by the Named Insured or for the Named Insured to determine, rectify, or test for any potential or actual problems described in paragraph 1) of this exclusion i).

2. under PART 1 - Liability Coverages and PART 2 -

Defense, Settlement, and Supplementary Payments of Liability Claims for Property Damage to property owned, occupied, used, rented, or transported by, or in the care, custody, or control of, an Insured except as provided under Coverage 4, 5, and 11;

3. under PART 1 – Liability Coverages, PART 2 – Defense, Settlement and Supplementary Payments of Liability Claims, and PART 5 – Medical Expenses, to any Insured who is also Insured under any contract of nuclear energy

liability insurance, in effect at the time of the Occurrence, issued by the Nuclear Energy Liability Insurance Association or the Mutual Atomic Energy Liability Underwriters that covers the claim, loss, damage, or expense, or that would cover the claim, loss, damage, or expense if such policy’s limits of liability were not exhausted;

4. under PART 3 – Physical Damage Coverages, to any loss, damage, claim, or expense:

a) that is due to, and confined to, wear and tear, rust, corrosion, deterioration, or mechanical or electrical breakdown of the insured property or its equipment, components, accessories, or tires, unless the damage is caused by fire, malicious mischief, vandalism, or theft or unless the loss or damage is the direct result of other Physical Damage, including ingestion, covered by this policy. Damage resulting from the breakdown, failure, or malfunction of an engine component, accessory, or part (as shown in the manufacturer’s parts list for the engine or accessory) is considered “mechanical breakdown” of the entire engine.

b) to any of the Aircraft’s turbine engines (including its turbine-powered auxiliary power units) caused by heat resulting from starting, attempted starting, operation, or shutdown thereof.

c) caused by the embezzlement, secretion, or conversion of the insured property.

d) due to depreciation in the value of, or arising from the loss of use of, the insured property.

PART 8 - LIMIT OF THE COMPANY’S LIABILITY

Other Insurance

Except with respect to insurance provided by this policy as Excess Insurance, if there is other insurance against any loss, liability, or expense covered by this policy, including any formal self insurance program or self insured retention plan, the Company will not be liable under this policy for a greater proportion of such loss, liability, or expense than the applicable limit of the Company’s liability under this policy bears to the total applicable limits of all other valid and collectible insurance. This provision applies to other insurance in the Insured’s name or otherwise.

Total Liability for PART 1 - Liability Coverages

The limits apply separately to each Insured Aircraft and each Insured, provided, however, that regardless of the number of Insureds under this policy, persons, or organizations who sustain Bodily Injury, Personal Injury, or Property Damage, and regardless of the

AGCS-BC 1400 (12-06) Page 16 of 19

number of claims made or suits brought because of Bodily Injury, Personal Injury, or Property Damage, the Company’s total liability for all damages as the result of any one Occurrence will not exceed the limit of liability stated in the Declarations as applicable to “each Occurrence,” subject in addition to the annual aggregate if specified. For the purpose of determining the limit of the Company’s liability, all Bodily Injury, Personal Injury, and Property Damage arising out of continuous or repeated exposure to the same general conditions will be deemed to arise out of one Occurrence.

Total Liability for PART 3 - Physical Damage Coverages

1. In the event of a Total Loss, the Company will promptly pay the Named Insured:

a) the Insured Value of the Scheduled Aircraft;

b) the amount of the Named Insured’s financial interest in any Spare Engine or Spare Part (less any applicable deductible), which amount will not exceed its actual cash value or the limit of the applicable coverage as stated in the Declarations, whichever is less.

If the Company makes payment of a Total Loss with respect to any Scheduled Aircraft, the Company’s liability with respect to such property will end and the Company will promptly refund the pro-rated unearned premium for any Scheduled Aircraft that is a Total Loss.

2. In the event of a Partial Loss, the Company’s liability will not exceed:

a) the total of the following items, less any applicable deductible, if the repairs are made by an Insured:

1) the net costs incurred by the Insured for necessary material and parts of like kind and quality;

2) the reasonable costs of transportation, food, and lodging for the Insured’s employees required during the actual period of repair if the loss occurs away from the Insured’s base of operations;

3) any additional “Transportation Costs” incurred by the Insured; and

4) actual wages paid for labor at the current straight time rates at the place of repair plus the reasonable cost of required supervision and overhead not to exceed 150% of actual wages.

b) the total of the following items, less any applicable deductible, if the repairs are made by other than the Insured:

1) the net costs incurred by the Insured for necessary material and parts of like kind and quality;

2) the reasonable costs (not to exceed $5,000 or 5% of the repair cost estimate, whichever is less) of transportation, food, and lodging for a necessary representative(s) of the Insured to inspect or authorize repairs and/or to conduct a test flight of the aircraft. This paragraph will apply only if the aircraft is being repaired away from its primary base of operations;

3) any additional “Transportation Costs” incurred by the Insured.

“Transportation Costs” under this subparagraph b) means the cost of transporting, by the least expensive reasonable means, (a) the damaged property to the place where it is most practicable to repair such property and, then, to the site of the loss or to the Insured’s home airport, whichever is closer (b) damaged parts from the site of the loss to and from the place where it is most practicable to repair such parts, or (c) replacement parts from the nearest available source of such parts to the site of the loss.

The Company’s liability for a Partial Loss is subject to the applicable limit of liability shown in the Declarations, but will not, in any event, exceed the Insured Value of the Scheduled Aircraft; or, with respect to Coverage 14, the lesser of the Named Insured’s financial interest in any Spare Engine or Spare Part or the actual cash value of such Spare Engine or Spare Part.

If the Company pays a claim for a Partial Loss and such payment is in an amount equal to the sum payable for a Total Loss, the Company will, at its option, be entitled to all the salvage. Salvage may not be abandoned to the Company without its prior consent.

If the Named Insured and the Company fail to agree on the amount of a loss, either may, within sixty (60) days after a proof of loss is filed, demand an appraisal of the loss. The Named Insured and the Company will each select a competent aircraft appraiser, and those appraisers then will select a competent and disinterested umpire. The appraisers will judge the amount of the loss, and if they do not agree, they will submit their difference to the umpire. Agreement in writing by any combination of two of the three will determine the amount of the loss. The Named Insured and the Company each will pay the expense of its chosen appraiser and they will bear equally the expenses of the appraisal and the umpire. The Company will not be held to have waived any of its rights by any act relating to appraisal.

In the event of a Partial Loss, whether or not such loss is covered by this policy, the Insured Value of the

AGCS-BC 1400 (12-06) Page 17 of 19

Scheduled Aircraft will automatically be reduced at the time of the loss by the amount of the loss. When repairs begin, the Insured Value will automatically increase by the value of the completed repairs until the Insured Value of the Scheduled Aircraft is fully restored.

The Company has the right to return stolen property to the Insured any time before the loss is paid, such return to be accompanied by payment for any resultant Physical Damage.

The amount specified as a deductible (if any) for Scheduled Aircraft does not apply to any Total Losses, arranged Total Losses, or any losses caused by fire, lightning, explosion, transportation of parts, theft, robbery, or pilferage. Provided, however, that the in-motion deductible, if any, will apply to any Partial Loss that is caused by fire or explosion, which fire or explosion results directly or indirectly from the collision or crash of an Aircraft while in-motion. Scheduled Aircraft deductibles will not apply in the event of a collision with any other aircraft insured through the Company under another policy.

Total Liability for PART 4 - Additional Coverages

The Company’s total liability for all costs or expenses incurred by or on behalf of the Named Insured will not exceed the limit of liability for each applicable coverage part as stated in the Declarations.

Severability of Interests

The limits and coverages afforded by this policy apply separately to each Insured, but the inclusion within this policy of more than one Insured will not increase the applicable limits of the Company’s total liability.

Two or More Aircraft Insured by this Policy

In the event that two or more aircraft are insured by this policy, the applicable limits of liability and deductibles (if any) will apply separately to each aircraft except that the coverage provided by Coverage 7 or 10 is subject to an aggregate limit for the policy period, regardless of how many Aircraft are insured under this policy.

PART 9 - NOTICE OF CLAIMS AND OTHER DUTIES OF AN INSURED

In the event of any accident, Occurrence, claim, suit, or loss, the Insured(s) and/or their legal representative(s) agree that they will:

1. not assume any obligation or liability, offer to pay any reward except at the Insured’s expense, or incur any expense other than those items listed in PART 2 of this policy;

2. promptly contact the Company and, as soon as reasonably possible thereafter, provide written notice including, if known, a) the time, place and

description of the pertinent events; b) the names and locations of Passengers, witnesses, and injured or deceased persons; and c) the location and description of any damaged property or aircraft;

3. immediately forward to the Company every demand, notice, summons, legal paper, or process of any sort that they receive;

4. cooperate and assist the Company in connection with any claim or suit;

5. do nothing after an accident or loss to impair or interfere with the Company’s right of recovery against any person or organization that may be liable to the Insured;

6. authorize the Company to obtain any records relating to a loss;

7. not abandon the Aircraft or any other salvage without the Company’s prior consent;

8. take all reasonable precautions to protect the Aircraft or other insured property after any accident or loss. Reasonable expenses incurred in taking such precautions will be deemed “incurred at the Company’s request.” Any further loss or damage that is caused by the Insured’s failure to take such precautions to protect the Insured property will not be covered by this policy;

9. promptly report any suspected theft or vandalism to the local police;

10. allow the Company, at its option, to inspect any aircraft or insured property before any repairs begin or before its disposal;

11. file with the Company, within ninety (90) days after the loss, a sworn proof of loss in the form and with the content that the Company reasonably requires and, upon the Company’s request, submit to examination under oath;

12. at such reasonable times and places as the Company may specify, exhibit any damaged property to the Company and produce for the Company’s examination and copying all pertinent sales receipts, repair and service invoices, log books, and other records and documents that may be required in the settlement of any claim;

13. if requested to do so, provide the Company, at the time the Company makes a Total Loss payment, with clear title to any related property salvage.

AGCS-BC 1400 (12-06) Page 18 of 19

PART 10 - OTHER CONDITIONS OF INSURANCE

Changing the Policy

No term, condition, or other provision in this policy can be changed or waived except by the Company’s written endorsement, approved and signed by the Company.

Inspection

The Company or its authorized representative will be permitted to inspect the insured property and any of the Insured’s records during the policy period and for one year afterward.

The Company’s Rights of Recovery

In the event of any payment by the Company under this policy, the Company will succeed to and assume all of the Insured’s rights of recovery against any person or organization. The Insured will do whatever is necessary to the Company’s enforcement of such rights, including but not limited to executing and delivering such instruments and papers as the Company may require.

This Policy Conforms to State Law

If the terms of this policy conflict with the Named Insured’s state or province law, the policy terms are deemed amended to the extent necessary to compliance with that law.

Transfer of the Policy to Others

No interest in this policy may be transferred without the prior written agreement of the Company. If the Named Insured dies, or is adjudged legally bankrupt or insolvent, and the Named Insured or its legal representative notifies the Company within 60 days of such death or judgment, then the Named Insured will become, effective upon the date of death or judgment:

1. any person or organization having custody of the Scheduled Aircraft until a legal agent is appointed, or

2. the Named Insured’s legal representative.

Cancellation and Non-Renewal of this Policy

This policy may be canceled by the Named Insured by mailing prior written notice to the Company stating when the cancellation will be effective. This policy may be canceled by the Company by mailing prior written notice to the first Named Insured at the first address shown in Item 2. of the Declarations stating when, not less than ninety (90) days thereafter, the cancellation will be effective. If the cancellation is for non-payment of any premium due, however, only ten (10) days prior written notice will be provided. The effective date and hour of

cancellation stated in the notice will become the end of the policy period.

If the Named Insured cancels the policy, earned premium will be computed in accordance with the customary short rate table and procedure. If the Company cancels, earned premium will be computed on a pro-rata basis. Premium adjustment may be made either at the time cancellation is effective or as soon as practicable after cancellation becomes effective, but payment or tender of unearned premium by the Company is not required in order for the cancellation to be effective.

The Company will mail written notice of non-renewal to the first Named Insured at least sixty (60) days prior to the expiration date of this policy in the event that either decided not to renew this policy.

The proof of mailing or delivering notice of non-renewal or cancellation to the first Named Insured by the Company will be sufficient proof of notice to all Insureds.

Financial Responsibility Laws

(applicable to PART 1 – Liability Coverages)

When this policy is certified as proof of financial responsibility for the future under the provisions of any aircraft financial responsibility law, the insurance afforded by this policy for Bodily Injury and Property Damage will comply as necessary with the provisions of the law, but in no event shall such insurance be in excess of the limits of liability stated in this policy. The Named Insured agrees to reimburse the Company for any payment made by the Company that the Company would not have been obligated to make under the terms of this policy except for the agreement in this paragraph.

Action Against the Company

No action will be taken against the Company unless, prior to such action, the Insured has fully complied with all of the terms and conditions of this policy and the amount of loss has been determined as set forth below:

LIABILITY COVERAGES - With respect to PART 1 - Liability Coverages, no action will lie against the Company until the amount of the Insured’s obligation to pay has been finally determined either by judgment against the Insured after actual trial or by written agreement of the Insured, the claimant, and the Company. Any person, organization, or legal representative thereof who has secured such judgment or written agreement will be entitled to recover under this policy to the extent of the coverages provided by this policy. No person or organization will have any right under this policy to join the Company as a party to any action against the Insured to determine the Insured’s liability, nor will the Company be impleaded by the Insured or its legal representative. Bankruptcy or insolvency of the Insured or of the

AGCS-BC 1400 (12-06) Page 19 of 19

Insured’s estate will not relieve the Company of any of its obligations under this policy.

PHYSICAL DAMAGE COVERAGES - With respect to PART 3 - Physical Damage Coverages, no action will lie against the Company, nor will payment for loss be required, until thirty (30) days after the required proof of loss is filed with the Company and the amount of loss is determined as described in PART 8 of this policy. Any action against the Company must be taken within one year after the date of the loss.

ADDITIONAL COVERAGES – With respect to all other Coverages, no action will lie against the Company, nor will payment for loss be required, until thirty (30) days after any required proofs of claims have been filed with the Company. Any action against the Company must be taken within one year after the date of the loss.

Cross Liability

This policy will cover claims by one Insured against another Insured and will provide coverage as if a separate policy had been issued to each Insured. In any event, however, this will neither increase nor change the limits of the Company's liability nor will it change any of the other terms, conditions, or Exclusions of this policy.

Certificates of Insurance

If the Company issues a Certificate of Insurance for or on behalf of the Named Insured, including any certificates required by military or governmental authorities, this policy automatically provides the insurance as is evidenced in that certificate.

Although this policy provides coverage in Mexico, the Mexican Government may require proof of aircraft liability written through a Mexican Insurance company. If the Insured does not have proof of Mexican liability insurance, the aircraft may be confiscated by the Mexican authorities and any Passengers may be jailed or detained.

It is a good practice to contact the Insured's agent or broker to arrange coverage if any flights are planned into or near Mexican Airspace. Mexican liability coverage is available through the Company if needed.

Representations and Entire Agreement

By acceptance of this policy, the Named Insured agrees that the statements in the Declarations are accurate and complete, that those statements are based upon representations made to the Company by the Named Insured, and that this policy has been issued in reliance upon those representations. This policy embodies all agreements existing between the Named Insured and the Company or any of its agents relating to this insurance.

Violation of Statute

If coverage for a claim under this policy is in violation of any of the United States of America’s economic or trade sanctions, including, but not limited to, sanctions administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”), then coverage for that claim shall be null and void.

---END---

All other provisions of this policy remain the same.

AGCS-AV 2105 (12-07) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 1

BROAD NAMED INSURED ENDORSEMENT

This endorsement modifies the policy to which it is attached as follows:

The Named Insured set forth on the Declarations is changed as follows: and any subsidiary, affiliated, owned or controlled companies or entities now in existence or hereafter formed or acquired jointly or severally, as their respective interests may appear. “Subsidiary, affiliated, owned or controlled companies or entities” means any company or entity of which at least fifty percent (50%) of the stock or fifty percent (50%) of the members or, if a partnership, fifty percent (50%) interest in the partnership is owned by the Named Insured, or for which the Named Insured has assumed active management control. Subsidiary, affiliated, owned or controlled companies or entities acquired after the effective date of your policy shall be reported to the Company within thirty (30) days after they are acquired.

AGCS-AV 3650 (01-08) Page 1 of 2

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 2

TRIA DISCLOSURE ENDORSEMENT

THIS ENDORSEMENT, DETAILING THE PROVISIONS OF THE "TERRORISM RISK INSURANCE ACT", AS AMENDED, IS MADE A PART OF THIS POLICY. NOTHING IN THIS ENDORSEMENT CHANGES ANY OF THE TERMS OR CONDITIONS OF THIS POLICY OR PROVIDES ANY ADDITIONAL COVERAGE.

I. Terrorism Risk Insurance Act Notice

Please take note that under the Terrorism Risk Insurance Act, as amended, (collectively referred to herein as “TRIA”), the Named Insured has a right to purchase insurance coverage from the Company for losses arising out of an "Act of Terrorism" as defined in Section 102(1) of “TRIA”.

Solely with respect to this endorsement and to ensure compliance with the Terrorism Risk Insurance Act, as amended, an “Act of Terrorism” shall mean:

(1) Act of Terrorism:

(A) Certification - The term “act of terrorism” means any act that is certified by the Secretary of the Treasury of the United States, in concurrence with the Secretary of State and the Attorney General of the United States.:

(i) to be an act of terrorism;

(ii) to be a violent act or an act that is dangerous to:

(I) human life;

(II) property; or

(III) infrastructure;

(iii) to have resulted in damage within the United States, or outside of the United States in the case of

(I) an air carrier or commercial vessel defined as one principally based in the United States, on which United States income tax is paid, and whose insurance coverage is subject to regulation in the United States;

(II) the premises of a United States mission; and

(iv) to have been committed by an individual(s) as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion.

(B) Limitation - No act shall be certified by the Secretary as an act of terrorism if:

(i) the act is committed as part of the course of war declared by the Congress, except that this clause shall not apply with respect to any coverage for workers’ compensation; or

(ii) property and casualty insurance losses resulting from the act, in aggregate, do not exceed $5,000,000.

(C) Determinations Final - Any certification of, or determination not to certify, an act of terrorism under this paragraph shall be final, and shall not be subject to judicial review.

(D) Non-delegation - The Secretary may not delegate or designate to any other officer, employee, or person, any determination under this paragraph of whether, during the effective period of the Program, an act of terrorism has occurred.

All other provisions of this policy remain the same.

AGCS-AV 3650 (01-08) Page 2 of 2

The full text of “TRIA” may be reviewed at http://www.treas.gov/offices/domestic-finance/financial-institution/terrorism-insurance/pdf/TRIAasamended-CompositeTextPost.pdf

Federal Share of Compensation

Payments made under this policy, for losses caused by a certified "Act of Terrorism", will be reimbursed in part by the United States Government to the Company using a formula established by Federal Law. Under this formula, the United States Government generally reimburses eighty-five percent (85%) of covered terrorism losses exceeding the statutorily established deductible paid by the Company for losses arising from certified "Acts of Terrorism".

$100 Billion Cap

The Terrorism Risk Insurance Act, as amended, contains a $100 billion cap that limits U.S. Government reimbursement as well as the Company's liability for losses resulting from certified "Acts of Terrorism" when the amount of such losses in any one calendar year exceeds $100 billion. If the aggregated insured losses for all insurers exceed $100 billion, coverage (if purchased) for "Acts of Terrorism" may be reduced.

II. Conditional Termination of Endorsement

A. This endorsement terminates under the following conditions, whichever occurs first:

i. upon the expiration of the policy, or

ii. if the “Terrorism Risk Insurance Program” (the “Program”) terminates (as provided by “TRIA” at the end of December 31, 2014) with respect to the coverage provided by this policy, and the “Program” is not renewed, extended or otherwise continued by the federal government or,

iii. if, on or after December 31, 2014, a renewal, extension or continuation of the “Program” becomes effective without a requirement to make terrorism coverage available to the Named Insured or with revisions that do any of the following:

a. increase the Company's statutory percentage deductible under the “Program” for terrorism losses,

b. decrease the federal government’s statutory percentage share in potential terrorism losses above such deductible or,

c. redefine terrorism or make insurance coverage for terrorism subject to provisions or requirements that differ from those that apply to other types of events or occurrences under this policy.

B. If none of the conditions set forth in paragraph II. A. above occur, this endorsement will continue in effect unless the Company notifies the Named Insured of changes in response to federal law.

III. “TRIA” Terrorism Coverage may be purchased from the Company. No coverage is provided by this notice. TRIA Terrorism Coverage must be purchased separately.

If “TRIA” coverage is purchased, the premium will be stated on the TRIA Write-Back Endorsement(s) attached to this policy.

If “TRIA” coverage has not been purchased, coverages for liability and/or physical damage losses from "Acts of Terrorism" are offered for rates that are available upon request from the Company.

(Any coverage for "Acts of Terrorism" will be subject to all the terms, conditions and limitations of this policy.)

Nothing herein contained shall be held to vary, waive, alter, or extend any of the terms, conditions, agreements, or representations of this policy, other than as above stated.

All other provisions of this policy remain the same.

AGCS-AV 3700 (01-08) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 3

TRIA EXCLUSION ENDORSEMENT

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

This policy does not cover claims caused by any losses, damages, or injuries arising directly or indirectly as a result of a certified “Act of Terrorism” defined by the Terrorism Risk Insurance Act, as amended.

Solely with respect to this endorsement and to ensure compliance with the Terrorism Risk Insurance Act, as amended, an “Act of Terrorism” shall mean:

(1) Act of Terrorism:

(A) Certification - The term “act of terrorism” means any act that is certified by the Secretary of the Treasury of the United States, in concurrence with the Secretary of State and the Attorney General of the United States.:

(i) to be an act of terrorism;

(ii) to be a violent act or an act that is dangerous to:

(I) human life;

(II) property; or

(III) infrastructure;

(iii) to have resulted in damage within the United States, or outside of the United States in the case of

(I) an air carrier or commercial vessel defined as one principally based in the United States, on which United States income tax is paid, and whose insurance coverage is subject to regulation in the United States;

(II) the premises of a United States mission; and

(iv) to have been committed by an individual(s) as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion.

(B) Limitation - No act shall be certified by the Secretary as an act of terrorism if:

(i) the act is committed as part of the course of war declared by the Congress, except that this clause shall not apply with respect to any coverage for workers’ compensation; or

(ii) property and casualty insurance losses resulting from the act, in aggregate, do not exceed $5,000,000.

(C) Determinations Final - Any certification of, or determination not to certify, an act of terrorism under this paragraph shall be final, and shall not be subject to judicial review.

(D) Nondelegation - The Secretary may not delegate or designate to any other officer, employee, or person, any determination under this paragraph of whether, during the effective period of the Program, an act of terrorism has occurred.

This endorsement shall apply solely to the Terrorism Risk Insurance Act, as amended, and shall in no way conflict with the War, Hijacking and Other Perils Exclusion contained within this policy or write-backs thereto.

AGCS-AV 4120 (08-10) Page 1 of 2

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 4

WAR, HIJACKING, EXTORTION AND OTHER PERILS PHYSICAL DAMAGE WRITE-BACK ENDORSEMENT

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

Notwithstanding anything in the policy to the contrary, this endorsement provides the coverages shown below: SECTION ONE - LOSS OF OR DAMAGE TO AIRCRAFT Subject to the terms, conditions and limitations set out below, this endorsement covers physical loss of or damage to the aircraft specified in the Declarations caused by (a) War, invasion, acts of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion,

revolution, insurrection, martial law, military or usurped power or attempts at usurpation of power; (b) Strikes, riots, civil commotions or labor disturbances; (c) Any act of one or more persons, whether or not agents of a sovereign power, for political or terrorist

purposes and whether the loss or damage resulting therefrom is accidental or intentional; (d) Any malicious act or act of sabotage; (e) Confiscation, nationalization, seizure, restraint, detention, appropriation, requisition for title or use by or

under the order of any Government, (whether civil, military, or de facto) or public or local authority; (f) Hijacking or any unlawful seizure or wrongful exercise of control of the aircraft or crew in flight (including

any attempt at such seizure or control) made by any person or persons on board the aircraft acting without the consent of the Insured.

Furthermore, this endorsement covers claims while the aircraft is outside the control of the Insured by reason of any of the above perils (a) through (f). The aircraft shall be deemed to have been restored to the control of the Insured on the safe return of the aircraft to the Insured at an airfield not excluded by the geographical limits of this endorsement and entirely suitable for the operation of the aircraft (such safe return shall require that the aircraft be parked with engines shut down and under no duress). SECTION TWO - EXTORTION COVERAGE The Company agrees to indemnify the Insured subject to the provisions below for any payment properly made in respect of threats against the aircraft, its passengers or crew, made during the currency of this endorsement. SECTION THREE - HIJACKING EXPENSE COVERAGE The Company agrees to indemnify the Insured subject to the provisions below, for any payment properly made in respect of extra expenses necessarily incurred following confiscation, etc. (as per Section One Clause (e)) or hijacking, etc. (as per Section One Clause (f)) of the aircraft. SECTION FOUR - GENERAL EXCLUSIONS This endorsement excludes loss, damage or expense caused by any of the following: (a) War (whether there be a declaration of war or not) between any of the following States: United Kingdom,

United States of America, France, the Russian Federation, the People’s Republic of China; nevertheless, if the aircraft is in the air when an outbreak of such war occurs, this exclusion shall not apply in respect of such aircraft until the said aircraft has completed its first landing thereafter;

(b) Any detonation of any weapon of war employing atomic or nuclear fission and/or fusion, or other like reaction or radioactive force or matter, whether hostile or otherwise;

All other provisions of this policy remain the same.

AGCS-AV 4120 (08-10) Page 2 of 2

(c) Any debt, failure to provide bond or security or any other financial cause under court order or otherwise; (d) The repossession or attempted repossession of the aircraft either by any title holder or arising out of any

contractual agreement to which any insured protected under this endorsement may be party; (e) Delay, loss of use or, except as specifically provided in Section Two, any other consequential loss whether

following upon loss of or damage to the aircraft or otherwise; SECTION FIVE - GENERAL CONDITIONS 1. With respect to the Coverages in Section Two and Three:

(a) The Insured is at all times responsible for ensuring that no arrangements of any kind are made which are not permitted by the proper authorities;

(b) The Limits of the Company’s liability shall not exceed an amount equal to 90% of the Agreed Value of the aircraft (but not more than $1,000,000.) for both Section Two and Section Three coverages combined;

(c) The Insured warrants the remaining 10% of such payments is not insured. 2. The Insured shall use all reasonable efforts to ensure compliance with the laws (local and otherwise) of any

country within whose jurisdiction the aircraft may be and to obtain all permits necessary for the lawful operation of the aircraft.

SECTION SIX – AMENDMENT OF TERMS, SUSPENSION AND AUTOMATIC SUSPENSION 1. Amendment of Terms

The Company may give notice effective on the expiry of seven days from midnight G.M.T. on the day on which notice is issued, to review the rate of premium and/or geographical limits.

2. Suspension by Notice

(a) This insurance may be suspended by the Company or the Insured giving notice not less than seven days prior to the end of each period of three months from inception.

PROVIDED THAT if the aircraft is in the air when such outbreak of war occurs then this insurance, subject to its terms and conditions and provided not otherwise cancelled, terminated or suspended, will be continued in respect of such aircraft until the said aircraft has completed its first landing thereafter.

(b) Upon the hostile detonation of any weapon of war employing atomic or nuclear fission and/or fusion or

other like reaction or radioactive force of matter wherever or whenever such detonation may occur and whether or not the insured aircraft may be involved.

3. Automatic Suspension

Whether or not such notice of suspension has been given, this insurance shall SUSPEND AUTOMATICALLY upon the outbreak of war (whether there be a declaration of war or not) between any one of the following countries, namely, the United Kingdom, United States of America, France, the Russian Federation, or the People’s Republic of China.

COVERAGE AS PROVIDED UNDER THIS ENDORSEMENT SHALL EXCLUDE ALL REQUIREMENTS OF THE TERRORISM RISK INSURANCE ACT OF 2002 and all subsequent renewals or amendments thereto.

All other provisions of this policy remain the same.

AGCS-AV 4125 (01-08) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 5

TRIA HULL WRITE-BACK

This endorsement modifies the policy to which it is attached as follows:

The portion of the annual premium for this policy that is attributable to coverage for "Acts of Terrorism" is $Included, and does not include any charges for the portion of losses covered by the United States government under the Act. Notwithstanding anything in the policy to the contrary, this endorsement provides the coverages shown below:

Physical Damage Coverage for Scheduled Aircraft

The Company will pay for the physical loss or physical damage to any insured aircraft unless specifically excluded below that is caused by an occurrence during the policy period arising out of the following peril:

An "Act of Terrorism" as defined within the United States Terrorism Risk Insurance Act, as amended, with respect to any one or more "Act of Terrorism." The Company will not pay any amounts for which the Company is not responsible under the terms of the Terrorism Risk Insurance Act, as amended, due to the application of any clause which results in a cap on our liability for payments for terrorism losses.

This endorsement will not cover any loss, damage, or expense for any occurrence involving the following insured aircraft (if any) which the Named Insured has elected not to purchase coverage as stated above.

Registration Number Make and Model Year Insured Value

None $ $

AGCS-BC 4140 (08-10) Page 1 of 2

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 6

WAR, HIJACKING AND OTHER PERILS LIMITED LIABILITY WRITE-BACK ENDORSEMENT

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

1. Whereas the policy of which this Limited Write-Back Endorsement forms a part includes the War, Hijacking and Other Perils Exclusion – Part 7, Exclusion 1., f), it is hereby understood and agreed that effective on the above date at 12:01 A.M., Standard Time, and only as respects Coverages 1, 2, 25 and 26, all sub-paragraphs other than sub-paragraph 1. f) 2) of the War, Hijacking and Other Perils Exclusion forming part of this policy are deleted, subject to all terms and conditions of this Limited Write-Back Endorsement.

2. Only with respect to the deletion of sub-paragraph 1. f) 1) from the War, Hijacking and Other Perils Exclusion

by virtue of paragraph 1. above, this Limited Write-Back Endorsement shall not apply to liability for damage to any form of property on the ground situated outside Canada and the United States of America unless caused by or arising out of the use of aircraft.

3. LIMITATION OF LIABILITY

The Company’s liability in respect of this Limited Write-Back Endorsement shall be a sub-limit as shown in the schedule below any one occurrence and in the annual aggregate except with respect to passengers in an aircraft in which case the Passenger Liability set forth in Coverage 1 of the Declarations shall apply (subject to any annual aggregate). The above sub-limit is included within the policy Limit of Liability applicable to Liability Coverages, and is not in addition thereto. In no event shall the Company’s liability under this Limited Write-Back Endorsement exceed the annual aggregate regardless of the number of (a) Insureds, (b) occurrences or events, (c) claims made or suits brought, or (d) persons or organizations making claims or bringing suits.

Schedule

(Only the clause(s) indicated by an “X” shall apply.)

Aircraft Registration Number Limit

All Scheduled Aircraft

All reported aircraft that are covered by the attached "Reporting Form Endorsement."

Same as the Single Limit for Bodily Injury and Property Damage reported for each aircraft, subject to a maximum Limit of Liability of $ , any one aircraft.

All other provisions of this policy remain the same.

AGCS-BC 4140 (08-10) Page 2 of 2

4. AUTOMATIC TERMINATION

This Limited Write-Back Endorsement shall terminate automatically upon the happening of any of the following circumstances:

a) Upon the outbreak of war (whether there be a declaration of war or not) between any two or more of the following: France, the People’s Republic of China, the Russian Federation, the United Kingdom, or the United States of America; or

b) Only with respect to the deletion of sub-paragraph 1. f) 1) from the War, Hijacking and Other Perils Exclusion by virtue of paragraph 1. above, upon the hostile detonation of any weapon of war employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter wherever or whenever such detonation may occur and whether or not an insured aircraft may be involved;

c) Upon the requisitioning of any insured aircraft for title or use.

However, if an insured aircraft is in flight when (a), (b) or (c) above occurs, then this Limited Write-Back Endorsement (unless otherwise cancelled, terminated or suspended) shall continue in respect of such aircraft until completion of its first landing and any passengers have disembarked.

5. REVIEW AND CANCELLATION

a) The Company may give notice to review premium and/or geographical limits; such notice shall be effective on the expiration of seven (7) days from 12:01 A.M., Standard Time on the day on which notice is given.

b) Following a hostile detonation as specified in paragraph 4. (b) above, the Company may give notice of

cancellation of one or more parts of this Limited Write-Back Endorsement provided in paragraph 1. above; such notice shall be effective on the expiration of forty-eight (48) hours from 12:01 A.M., Standard Time on the day on which notice is given.

c) This Limited Write-Back Endorsement may be cancelled by either the Company or the Insured giving

notice to become effective on the expiration of seven (7) days from 12:01 A.M., Standard Time on the day on which such notice is given.

d) All notices referred to herein shall be in writing

Nothing herein contained shall be held to vary, waive, alter, or extend any of the terms, conditions, agreements, or representations of the undermentioned policy, other than as above stated.

All other provisions of this policy remain the same.

AGCS-AV 4620 (07-06) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 7

MEXICAN LIABILITY

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

With respect to the following aircraft: N#(s) The Company has arranged Mexican Liability Insurance, as required under Mexican law, through Policy No(s). . The limits of coverage provided under Policy No(s). shall be part of and not in addition to the limits of coverage provided under any policy written through the Company.

All other provisions of this policy remain the same.

AGCS-AV 6200 (08-07) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 8

ADDITIONAL INSURED ENDORSEMENT

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

(Only the clause(s) indicated by an “X” shall apply.)

The scheduled persons or organizations are included as additional insured.

The scheduled persons or organizations are included as an additional insured under the liability coverages as respects their operation of N# under a “dry lease agreement” between the Named Insured and the scheduled persons or organizations.

The scheduled persons or organizations are included as additional insured but only as respects liability coverages.

The scheduled persons or organizations are included as additional insured under the liability coverages, but only as respects operations of the Named Insured.

The scheduled persons or organizations are included as additional insured but only as respects operations of the Named Insured.

The scheduled persons or organizations are included as additional insured under the liability coverages but only as respects the Named Insured’s use of premises owned, rented or controlled by the scheduled persons or organizations.

Such insurance as is afforded by this policy shall also apply to the scheduled organization as an additional insured insofar as work performed by the Insured for and/or under agreement between the Insured and the scheduled organization is concerned.

The scheduled organization shall not by reason of its inclusion as an additional insured incur liability to us for payment of premium for such insurance.

Coverage is primary and is not contributing with any insurance or self-insurance maintained by the scheduled organization.

The term “Insured” is used severally and not collectively, but the inclusion herein of more than one Insured shall not operate to increase the Limit of the Company’s Liability.

This policy will not be canceled nor the coverage materially changed adversely to the scheduled organization by the Company without thirty (30) days prior written notice (10 days for non-payment of premium) of such cancellation or adverse change in coverage to the scheduled organization at the address indicated.

With respect to Physical Damage Coverage, the Company agrees to waive its right of recovery against the scheduled organization and its subsidiaries.

The insurance extended by this endorsement shall not apply to, and the person or organization named in the schedule is not insured for Bodily Injury or Property Damage which arises from the design, manufacture, modification, repair, sale, or servicing of aircraft, aircraft parts, or any other product by that person or organization.

Schedule:

All other provisions of this policy remain the same.

AGCS-AV 6450 (07-06) Page 1 of 1

Named Insured: Named Insured & Address Policy Number: Endorsement Number Effective Date: 9

LIENHOLDER’S INTEREST ENDORSEMENT

In consideration of an additional premium of $Included, this endorsement modifies the policy to which it is attached as follows:

Loss, if any, under any physical damage coverage provided by this policy shall be payable to the Named Insured and the following (hereinafter called the Lienholder) as interests may appear:

1. As to the interest of the said Lienholder only, the insurance afforded by any physical damage Coverage of this policy shall not be invalidated by any act or neglect of the Named Insured nor by any change in the title or ownership of the aircraft but conversion, embezzlement or secretion by or at the direction of the Named Insured is not covered hereunder; provided however that:

(a) in case the Named Insured shall neglect to pay any premium due under this policy the Lienholder shall, on demand, pay the premium; and

(b) the Lienholder shall notify the Company of any change of title or ownership of the aircraft or apparent increase of hazard, which shall come to the knowledge of the Lienholder, and, unless permitted by this policy, it shall be endorsed thereon and the Lienholder shall, on demand, pay the premium for such increased hazard.

2. The liability of the Company to any Lienholder under the provisions of Paragraph 1 of this endorsement shall not exceed:

(a) the unpaid balance due on liens pertaining to the aircraft less unearned interest and unpaid installments more than ten (10) days overdue on the date of loss or damage; nor

(b) the amount of lien recited in paragraph 6 of this endorsement, which would have remained unpaid at the time of the loss or damage had all payments been made when not more than ten (10) days overdue; nor

(c) 100% of the Insured Value of the aircraft as stated in this policy, whichever is less.

3. Whenever the Company shall pay any sum for loss, damage or expense under any physical damage Coverage of this policy and claim that, as to the Named Insured, no liability existed therefor, the Lienholder shall thereupon, to the extent of such payment, assign, deliver and convey all interest that the Lienholder may have in said aircraft, all instruments of security pertaining thereto and rights against the Named Insured, to the Company. The Named Insured agrees to promptly reimburse the Company for any sum paid for loss, damage or expense which the Company would not have been obligated to pay but for the provisions of paragraph 1 of this endorsement.

4. No provision in this policy in relation to deductions from any loss payable shall be applicable to any payment to the Lienholder under Paragraph 1 of this endorsement other than as set forth in this endorsement.

5. In the event this policy or this endorsement is cancelled by the Company, thirty (30) days (ten (10) days if for nonpayment of premium) prior notice shall be sent to the said Lienholder named herein.

6. This endorsement shall be applicable only with respect to the aircraft identified below.

Aircraft Registration Number(s) Amount of Lien