WILLIS LEASE FINANCE CORP
EXHIBIT 10.3
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>2
<FILENAME>a2029241zex-10_3.txt
<DESCRIPTION>EXHIBIT 10.3
<TEXT>

<PAGE>

                          WILLIS LEASE FINANCE CORPORATION
                                AND SUBSIDIARIES

Exhibit 10.3

Employment Contract for Nicholas J. Novasic, dated June 15, 2000



                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is made and entered into
as of the 15th day of June, 2000, by and between Willis Lease Finance
Corporation, a Delaware corporation ("EMPLOYER"), and Nicholas J. Novasic
("EMPLOYEE").

                                    RECITALS

         WHEREAS, Employee desires to become employed by Employer as its
Executive Vice President, Finance and Chief Financial Officer on the terms and
conditions set forth herein, and Employer desires to employ Employee as its
Executive Vice President, Finance and Chief Financial Officer on such terms and
conditions;

         WHEREAS,  Employee and Employer desire to put into writing the terms of
Employee's employment agreement; and

         WHEREAS, Employee acknowledges that he has had an opportunity to
consider this Agreement and consult with independent advisors of his choosing
with regard to the terms of this Agreement, and enters this Agreement
voluntarily and with a full understanding of its terms.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the foregoing recitals, the mutual
promises of the parties and the mutual benefits they will gain by the
performance thereof, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

         1.       EMPLOYMENT. Employer hereby employs Employee and Employee
hereby accepts employment, upon the terms and conditions hereinafter set
forth, as the Executive Vice President, Finance and Chief Financial Officer
of Employer. Employee shall devote his full time and attention, with
undivided loyalty, to the business and affairs of Employer during the
Employment Term. Employee shall not engage in any other business or job
activity during the Employment Term without Employer's prior written consent.

         2.       TERM.

                  (a) The term of Employee's employment under this Agreement
shall be for a two (2) year period commencing on or about June 15, 2000 ("START
DATE") and ending on June 14, 2002 (as may be extended hereunder, the
"EMPLOYMENT TERM"), unless otherwise terminated pursuant to the terms hereof.
Each full twelve month period Employee is employed by Employer shall be referred
to herein as an "EMPLOYMENT YEAR."

                  (b) After the expiration of the initial Employment Term and
until the Termination Date (as defined below), Employee's employment will
automatically renew for a period of one year, each year, on the same terms and
conditions as are set forth herein, unless either party gives the other written


<PAGE>

notice of nonrenewal at least six (6) months prior to the end of the last
applicable Employment Year. Employee shall be entitled to the payments set
forth in Section 7 or Section 8 hereof in the event either party gives the
other such a notice of nonrenewal.

                  (c) Upon the occurrence of a Change in Control, this Agreement
shall be automatically extended for a period equal to the greater of: (I) the
remaining Employment Term, and (II) the eighteen month period commencing on the
date of the Change in Control event and ending on the eighteen month anniversary
of the Change in Control event (the "CHANGE IN CONTROL EXTENSION"). "CHANGE IN
CONTROL" means the occurrence of any of the following events: (i) any "person"
(as such term is used in Section 13(d) and 14(d) of the Securities Exchange Act
of 1934, as amended), other than Charles F. Willis IV or an Affiliate (as
defined in Section 13) of Charles F. Willis IV, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or indirectly, of
securities of Employer representing at least fifty percent (50%) of the total
voting power represented by Employer's then outstanding voting securities; or
(ii) the stockholders of Employer approve a merger or consolidation of Employer
with any other corporation, other than a merger of consolidation which would
result in the voting securities of Employer outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at least fifty (50%)
of the total voting power represented by the voting securities of Employer or
such surviving entity outstanding immediately after such a merger or
consolidation, or the stockholders of Employer approve a plan of complete
liquidation or dissolution of Employer or an agreement for the sale or
disposition by Employer or all of substantially all of Employer's assets,
provided, however, that if such merger, consolidation, liquidation, dissolution,
sale or disposition does not subsequently close, a Change in Control shall not
be deemed to have occurred; or (iii) individuals who are directors of Employer
as of the date hereof cease for any reason to constitute a majority of
Employer's Board of Directors (the "BOARD") unless such change(s) is approved by
a majority of the directors of Employer as of the date hereof.

         3.       DUTIES.

                  (a) Employee shall in good faith perform those duties and
functions as are required by his position and as are determined and assigned to
him from time to time by the Board or its designate(s). Such duties shall
include, without limitation, management responsibility for funding, treasury,
cash management, accounting, management information systems, investor relations,
and financial public relations. Notwithstanding the foregoing or any other
provision in this Agreement, Employer shall have the right to modify from time
to time the title and duties assigned to Employee so long as such title and
duties are consistent with the usual and customary expectations of the type of
position and function of Employee.

                  (b) Employee agrees to serve Employer faithfully and to the
best of his ability; to devote his full-time and attention, with undivided
loyalty, during normal business hours to the business and affairs of Employer,
except during reasonable vacation periods and periods of illness and incapacity;
and to perform such duties as the Board may assign, such duties to be of a
character and dignity appropriate to the Executive Vice President, Finance and
Chief Financial Officer. Employee shall not engage in any other business or job
activity during the Employment Term without Employer's prior written consent.


                                       2

<PAGE>

Notwithstanding the foregoing, Employee may engage in civic and
not-for-profit activities so long as such activities do not materially
interfere with Employee's performance of his duties hereunder.

         4.       COMPENSATION. Employer agrees to provide as compensation to
Employee the following salary, incentive, and benefits in exchange for the
services described in Section 3 of this Agreement:

                  (a) BASE SALARY. Employer agrees to pay to Employee during the
Employment Term an annual base salary in the amount of Two Hundred Thirty-Five
Thousand Dollars ($235,000) per Employment Year less payroll deductions and all
required withholdings, or such higher amount as the Board shall from time to
time determine, such salary to be paid in accordance with the usual manner of
payment of executive salaries by Employer. Employee's base salary shall be paid
not less frequently than semi-monthly in accordance with Employer's usual
payroll practices. The Compensation Committee of the Board will review
Employee's base salary no less than once annually, and shall have sole
discretion to increase or decrease (subject to the next sentence hereof) the
base salary. Employee's base salary may only be decreased in connection with a
salary reduction program approved by the Board which affects all senior
executive officers of Employer.

                  (b) INCENTIVE COMPENSATION. In addition to Employee's base
salary, Employee shall participate in and, to the extent earned or otherwise
payable thereunder, receive periodic incentive cash bonuses pursuant to any
incentive plans currently maintained or hereafter established by Employer and
applicable to an employee of Employee's position, which presently is the 2000
Incentive Compensation Plan For Executive Officers. Employee's entitlement to
incentive bonuses is discretionary and shall be determined by the Board or its
Compensation Committee in good faith based upon the duties of Employee's
position, the extent to which Employee's individual performance objectives and
Employer's profitability objectives and other financial and non-financial
objectives were achieved during the applicable bonus period and comparative
market practices. The 2000 Incentive Compensation Plan For Executive Officers
provides that in addition to Employee's base salary, Employee shall be paid a
cash bonus of up to 85% of Employee's base salary ("Incentive Bonus"). The first
70% of the Incentive Bonus shall be conditioned upon attaining an earnings per
share ("EPS") target as set by the Board. The remaining 30% shall be conditioned
upon achieving individual milestones and/or objectives established by the Chief
Executive Officer for Employee. The Compensation Committee of the Board will
annually set the target EPS and approve the incentive compensation plan.

                  (c) SIGNING BONUS. Within ten days after Employee's Start
Date, Employee shall be paid a cash bonus equal to $30,000 (the "Signing
Bonus"). If Employee voluntarily terminates his employment with Employer within
one year from Employee's Start Date, Employee hereby agrees to reimburse
Employer an amount of cash equal to $15,000, which is 50% of the Signing Bonus.

         5.       BENEFITS AND PERQUISITES.

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<PAGE>

                  (a) BENEFITS. Employer shall provide Employee such employment
benefits, equipment, and support as are generally available to senior executive
officers of Employer, including without limitation reimbursement of reasonable
expenses incurred in performing his duties under this Agreement (including, but
not limited to, expenses for entertainment, long distance telephone calls,
lodging, meals, transportation and travel), coverage under medical, dental,
long-term disability and group life insurance plans, and rights and benefits for
which Employee is eligible under Employer's 401(k) and employee stock purchase
plans.

                  (b) VACATION AND SICK PAY. Employee shall be eligible for
vacation and sick leave in accordance with the policies of Employer in effect
from time to time during the Employment Term. Employee shall be entitled to a
period of annual vacation time equal to four (4) weeks during each Employment
Year, to accrue pro rata during the course of the Employment Term, PROVIDED THAT
for the purposes of this Section 5(b), for the fiscal 2000 vacation time will be
pro-rated from Employee's Start Date. All accrued vacation and sick pay shall be
paid to Employee in a lump sum payment on the date of a Change in Control or
Retirement or termination of employment with Employer. For purposes of this
Agreement, "RETIREMENT" means Employee's voluntary termination on a date after
which Employee has reached the age of 55 and after which Employee has provided
Employer with at least 10 years of service.

                  (c) PERQUISITES. Employer shall also provide Employee with a
leased automobile having a cost of up to $65,000. In addition, Employer will
reimburse Employee for expenses related to such automobile, including repairs
and insurance.

         6.       STOCK OPTIONS.

                  (a) In consideration of the services to be provided by
Employee hereunder, within 30 days of Employee's Start Date, Employee will be
granted options to purchase 40,000 shares of common stock of Employer at an
exercise price equal to the then current market price of Employer's common
stock. Such initial option grant will be granted under Employer's Stock Option
Plan ("PLAN"). The options will vest over forty-eight (48) months in four equal
installments, 25% on the first anniversary of the Employment Year and 25% of the
remaining shares subject to the option for each subsequent Employment Year,
until fully vested.

                  (b) Employee shall be eligible to participate in the Plan on
the same terms as are generally available to senior executive officers of
Employer and on terms which are in accordance with comparative market practices.
The parties agree that any grant of stock options under the Plan or any similar
plan is subject to the discretion of the Board based upon the duties of
Employee's position, the extent to which Employee's individual performance
objectives and Employer's profitability objectives and other financial and
non-financial objectives were achieved during the applicable period and
comparative market practices.

                  (c) In addition to any rights Employee may have under any Plan
or specific option grants under any Plan, all stock options granted to Employee
which would have otherwise vested during the period following the occurrence of
a Change in Control shall immediately vest and become exercisable in the event
of a Change in Control.

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<PAGE>

         7.       TERMINATION/NONRENEWAL BY EMPLOYER. The date on which
Employee's employment by Employer ceases, under any of the following
circumstances, shall be defined herein as the "TERMINATION DATE." The
employment of Employee may be terminated by Employer or Employer may decide
not to renew this Agreement for any reason or no reason, with or without
cause or justification, subject to the following:

                  (a) TERMINATION FOR CAUSE. If (i) Employee's employment is
terminated by Employer for Cause (as defined below), or (ii) Employer gives
Employee a notice of nonrenewal pursuant to Section 2(b) hereof for Cause,
Employer's total liability to Employee or his heirs shall be limited to payment
of any unpaid base salary and prorated annual incentive due for the year of
termination and accrued vacation and sick pay, and Employee shall not be
entitled to any further compensation or benefits provided under this Agreement,
including, without limitation, any severance payments. "CAUSE" includes, but
shall not be limited to: (1) Employee's conviction of or plea of nolo contendere
to any felony or gross misdemeanor charges brought in any court of competent
jurisdiction; (2) any fraud, misrepresentation or gross misconduct by Employee
against Employer; and (3) Employee's breach of this Agreement.

                  (b) TERMINATION WITHOUT CAUSE. If (i) Employee's employment is
terminated by Employer without Cause, or (ii) Employer provides Employee with a
notice of nonrenewal pursuant to Section 2(b) hereof without Cause, Employer
will (A) in the case of termination, provide not less than six (6) months notice
of termination or an amount equal to six (6) months of Employee's base salary in
lieu of notice and (B) in the case of nonrenewal, provide notice of nonrenewal
at least six (6) months prior to the end of the last applicable Employment Year
or an amount equal to six months base salary in lieu of notice. In addition, in
each of the foregoing scenarios, Employee will be paid the severance which is
described in Section 9 below.

         (c) FINAL TERMINATION DATE. This Agreement shall terminate without
notice on the Final Termination Date. "FINAL TERMINATION DATE" means October 25,
2016, unless extended.

                  8. TERMINATION/NONRENEWAL BY EMPLOYEE. The employment of
Employee may be terminated by Employee or Employee may decide not to renew this
Agreement for any reason or no reason, with or without cause or justification,
subject to the following:

                  (a) VOLUNTARY RESIGNATION. If (i) Employee's employment
terminates by reason of Employee's voluntary resignation (and is not a
resignation for Good Reason), or (ii) Employee gives Employer a notice of
nonrenewal pursuant to Section 2(b) hereof (which is not given for Good Reason),
Employer's total liability to Employee shall be limited to payment of any unpaid
base salary and prorated annual incentive due for the year of termination and
accrued vacation and sick pay, and Employee shall not be entitled to any further
compensation or benefits provided under this Agreement, including, without
limitation, any severance payments.

                  (b) RESIGNATION FOR GOOD REASON. If (i) Employee's employment
terminates by reason of Employee's voluntary resignation for Good Reason, or
(ii) Employee provides Employer with a notice of nonrenewal pursuant to Section
2(b) hereof for Good Reason, Employee will be paid the severance which is
described in Section 9 below. "GOOD REASON" means: Employee's voluntary



                                       5
<PAGE>

termination following (i) a reduction in compensation  which is not in
proportion to any salary reduction program approved by the Board which
affects all executive officers of Employer; (ii) a reduction in material
benefits; (iii) not maintaining Employee's positions, title, duties and
status or changing Employee's reporting obligations without  Employee's
written consent; (iv) requiring Employee to work at a location more
than 50 miles from the location specified in Section 14; or (v) any willful
and material breach by Employer of its obligations pursuant under this
Agreement.

                  Employee agrees to give Employer at least ninety (90) days
prior written notice of termination of his employment and at least six months
prior written notice of nonrenewal of this Agreement. Employer shall have the
right in its sole discretion to continue to employ Employee for ninety days or
six months, as applicable, or for a shorter period with pay in lieu of notice to
Employee in the amount to which Employee would have been entitled if employed
for the ninety-day or six month notice period.

         9.       SEVERANCE PAYMENT.

                  (a) AMOUNT. In the event severance is payable hereunder,  such
severance shall be in an amount equal to

                           (i) one times Employee's base salary at the time of
         termination, or if during a Change in Control Extension, one and one
         half times Employee's base salary at the time of termination, plus

                           (ii) one times the annual incentives paid to Employee
         during the one year period prior to the year of termination, or if
         during a Change in Control Extension, one and one half times the annual
         incentives paid to Employee during the one year period prior to the
         year of termination, plus

                           (iii) any unpaid base salary and prorated annual
         incentive due for the year of termination and accrued vacation and sick
         pay, plus

                           (iv)  distribution of unpaid  deferred  compensation,
         plus

                           (v) immediate vesting of all stock options which
         would otherwise have vested during the following one year period, plus

                           (vi) continued coverage under all group benefit plans
         (e.g., medical, dental and life insurance) for a period of one year
         following the Termination Date, or if during a Change in Control
         Extension, continued coverage under all group benefit plans (e.g.,
         medical, dental and life insurance) for a period of eighteen months
         following the Termination Date.

                  (b) PAYMENT. All cash components of the above-described
severance payments shall be paid in a lump sum within 30 days of the date of
termination of employment or, at the option of Employee and subject to the
approval of Employer, in four equal installments, payable every three months,
commencing on the date that is 30 days after the date of termination of
employment.

                  (c) LIMITATION ON PAYMENTS. If any payment or benefit Employee
would receive from Employer or otherwise ("Payment") would (i) constitute a
"parachute payment" within the meaning of Section 280G of the Internal Revenue



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<PAGE>


Code of 1986, as amended (the "Code"),  and (ii) but for this sentence,  be
subject to the excise tax imposed by Section  4999 of the Code (the "Excise
Tax"),  then such Payment shall be reduced to the Reduced Amount. The
"Reduced Amount" shall be either (x) the  largest  portion  of the  Payment
that  would  result in no portion of the Payment  being subject to the Excise
Tax or (y) the largest  portion,  up to and including the total, of the
Payment, whichever amount, after taking into account all applicable federal,
state and local employment taxes, income taxes, and the Excise Tax (all
computed at the highest  applicable  marginal rate),  results in Employee's
receipt, on an after-tax basis, of the greater amount of the Payment
notwithstanding  that all or some  portion of the  Payment may be subject to
the Excise  Tax. If a reduction  in  payments  or benefits  constituting
"parachute payments" is necessary so that the Payment equals the Reduced
Amount,  reduction shall occur in the following order unless Employee elects
in writing a different order  (PROVIDED,  HOWEVER,  that such  election
shall be  subject  to  Company approval  if made on or after  the date on
which  the event  that  triggers  the Payment occurs): reduction of cash
payments; cancellation of accelerated vesting of  stock  awards;  and
reduction  of  employee  benefits.  In the  event  that acceleration  of
vesting of stock  award  compensation  is to be  reduced,  such acceleration
of vesting  shall be cancelled in the reverse order of the date of grant of
Employee's  stock awards unless  Employee elects in writing a different order
for cancellation.

         The accounting firm engaged by Employer for general audit purposes as
of the day prior to the effective date of the event that triggers the Payment
shall perform the foregoing calculations. If the accounting firm so engaged by
Employer is serving as accountant or auditor for the individual, entity or group
effecting the "change in ownership" as described in Section 280G(b)(2)(A)(i) of
the Code, Employer shall appoint a nationally recognized accounting firm to make
the determinations required hereunder. Employer shall bear all expenses with
respect to the determinations by such accounting firm required to be made
hereunder.

         The accounting firm engaged to make the determinations hereunder shall
provide its calculations, together with detailed supporting documentation, to
Employer and Employee within fifteen (15) calendar days after the date on which
Employee's right to a Payment is triggered (if requested at that time by
Employer or Employee) or such other time as requested by Employer or Employee.
If the accounting firm determines that no Excise Tax is payable with respect to
a Payment, either before or after the application of the Reduced Amount, it
shall furnish Employer and Employee with an opinion reasonably acceptable to
Employee that no Excise Tax will be imposed with respect to such Payment. Any
good faith determinations of the accounting firm made hereunder shall be final,
binding and conclusive upon Employer and Employee.

         10.      BENEFITS UPON TERMINATION. Except as otherwise expressly
provided by this Agreement and without limiting any rights granted to
Employee hereunder, all benefits provided under Section 5 of this Agreement
shall be extended, at Employee's election and cost, to the extent permitted
by Employer's insurance policies and benefit plans, for one year after
Employee's Termination Date, except (a) as required by law (e.g., COBRA
health insurance continuation election) or (b) in the event of a termination
described in Section 7 or 8.

         11.      DEATH/DISABILITY.

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<PAGE>

                  (a) In the event (during the Employment Term) of Employee's
death, (i) this Agreement shall terminate, (ii) Employer shall pay to Employee's
estate or heirs any unpaid base salary and prorated annual incentive due for the
year in which such event occurs, and (iii) Employee's estate and heirs shall not
be entitled to any severance payments hereunder.

                  (b) In the event (during the Employment Term) of Employee's
long term disability (as defined in Employee's Group Disability Plan) and the
passing of the Elimination Period (as defined in Employee's Group Disability
Plan), (i) this Agreement shall terminate, (ii) Employer shall pay to Employee
any unpaid base salary and prorated annual incentive due for the year in which
such event occurs, and (iii) Employee shall not be entitled to any severance
payments hereunder.

         12.      MAINTENANCE OF CONFIDENTIALITY AND DUTY OF LOYALTY.

                  (a) GENERAL. Employee acknowledges that, pursuant to his
employment with Employer, he will necessarily have access to trade secrets and
information that is confidential and proprietary to Employer in connection with
the performance of his duties. In consideration for the disclosure to Employee
of, and the grant to Employee of access to such valuable and confidential
information and in consideration of his employment, Employee shall comply in all
respects with the provisions of this Section 12.

                  (b) NONDISCLOSURE. During the Employment Term and for a period
of three (3) years thereafter, Confidential and Proprietary Information of
Employer of which Employee gains knowledge during the Employment Term shall be
used by Employee only for the benefit of Employer in connection with Employee's
performance of his employment duties, and Employee shall not, and shall not
allow any other person that gains access to such information in any manner to,
without the prior written consent of Employer, disclose, communicate, divulge or
otherwise make available, or use, any such information, other than for the
immediate benefit of Employer. For purposes of this Agreement, the term
"CONFIDENTIAL AND PROPRIETARY INFORMATION" means information not generally known
to the public and which is proprietary to Employer and relates to Employer's
existing or reasonably foreseeable business or operations, including but not
limited to trade secrets, business plans, advertising or public relations
strategies, financial information, budgets, personnel information, customer
information and lists, and information pertaining to research, development,
manufacturing, engineering, processing, product designs (whether or not patented
or patentable), purchasing and licensing, and which may be embodied in reports
or other writings or in blue prints or in other tangible forms such as equipment
and models. Employee will refrain from any acts or omissions that would
jeopardize the confidentiality or reduce the value of any Employer Confidential
and Proprietary Information.

                  (c) COVENANT OF LOYALTY. During the Employment Term, Employee
shall not, on his own account or as an employee, agent, promoter, consultant,
partner, officer, director, or as a more than 1% shareholder of any other
person, firm, entity, partnership or corporation, own, operate, lease,
franchise, conduct, engage in, be connected with, have any interest in, or
assist any person or entity engaged in any business in the continental United



                                       8
<PAGE>

States that is in any way competitive with or similar to the business  that
is  conducted by Employer or is in the same general  field or industry as
Employer. Without limiting the generality of the foregoing, Employee does
hereby covenant that he will not, during the Employment Term:

                           (i) solicit,  accept or receive any compensation from
         any  customer  of  Employer  or any  business  competitive  to  that of
         Employer; or

                           (ii) contact, solicit or call upon any customer or
         supplier of Employer on behalf of any person or entity other than
         Employer for the purpose of selling, providing or performing any
         services of the type normally provided or performed by Employer; or

                           (iii) induce or attempt to induce any person or
         entity to curtail or cancel any business or contracts which such person
         or entity has with Employer; or

                           (iv) induce or attempt to induce any person or entity
         to terminate, cancel or breach any contract which such person or entity
         has with Employer, or receive or accept any benefits from such
         termination, cancellation or breach.

                  (d) NO SOLICITATION. During the Employment Term and for a
period of three years thereafter, Employee agrees not to interfere with the
business of Employer or any Affiliate of Employer by directly or indirectly
soliciting, attempting to solicit, inducing or otherwise causing any employee of
Employer or any Affiliate of Employer to terminate his or her employment with
Employer in order to become an employee, consultant or independent contractor to
or for any other person or entity.

                  (e) INJUNCTIVE RELIEF. Employee expressly agrees that the
covenants set forth in this Section 12 are reasonable and necessary to protect
Employer and its legitimate business interests, and to prevent the unauthorized
dissemination of Confidential and Proprietary Information to competitors of
Employer. Employee also agrees that Employer will be irreparably harmed and that
damages alone cannot adequately compensate Employer if there is a violation of
this Section 12 by Employee, and that injunctive relief against Employee is
essential for the protection of Employer. Therefore, in the event of any such
breach, it is agreed that, in addition to any other remedies available, Employer
shall be entitled as a matter of right to injunctive relief in any court of
competent jurisdiction, plus attorneys' fees actually incurred in seeking such
relief. Furthermore, Employee agrees that Employer shall not be required to post
a bond or other collateral security with the court if Employer seeks injunctive
relief. To the extent any provision of this Section 12 is deemed unenforceable
by virtue of its scope or limitation, Employee and Employer agree that the scope
and limitation provisions shall nevertheless be enforceable to the fullest
extent permissible under the laws and public policies applied in such
jurisdiction where enforcement is sought.

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<PAGE>

         13.      AFFILIATE. "Affiliate" means a person that, directly or
indirectly, through one or more intermediaries controls, is controlled by or
is under common control with the first mentioned person.

         14.      NOTICES. Any notice which either party may wish or be
required to give to the other party pursuant to this Agreement shall be in
writing and shall be either personally served or deposited in the United
States mail, registered or certified, and with proper postage prepaid. Mailed
notices to Employee shall be addressed to Employee at the home address from
which Employee most recently communicated to Employer in writing. In the case
of Employer, mailed notices shall be addressed to its corporate headquarters,
and all notices shall be directed to the attention of corporate counsel.
Notice given by personal service shall be deemed effective upon service.
Notice given by registered or certified mail shall be deemed effective three
(3) days after deposit in the mail.

         15.      BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, their respective legal
representatives, and their successors and assigns. As used in this Agreement,
the term "SUCCESSOR" shall include any person, firm, corporation or other
business entity which at any time, whether by merger, purchase,
consolidation, or otherwise, acquired all or substantially all of the assets
or business of Employer. This Agreement shall be deemed to be willfully
breached by Employer if any such successor does not absolutely and
unconditionally assume all of Employer's obligations under this Agreement and
agree expressly to perform the obligations in the same manner and to the same
extent as Employer would be required to perform such obligations in the
absence of the succession. Employee may not assign any of his duties
hereunder and he may not assign any of his rights hereunder without the
written consent of Employer, which shall not be unreasonably withheld.

         16.      ENTIRE AGREEMENT. This Agreement contains the entire
agreement of the parties and supersedes and replaces all prior agreements and
understandings between the parties relating to the subject matter hereof.

         17.      GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California.

         18.      ARBITRATION. Any controversy or claim arising out of or
relating to this Agreement shall be finally settled by binding arbitration in
the County of San Francisco, California, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect. The
controversy or claim shall be submitted to three arbitrators, one of whom
shall be chosen by Employer, one of whom shall be chosen by Employee, and the
third of whom shall be chosen by the two arbitrators so selected. The party
desiring arbitration shall give written notice to the other party of its
desire to arbitrate the particular matter in question, naming the arbitrator
selected by it. If the other party shall fail within a period of 15 days
after such notice shall have been given to reply in writing naming the
arbitrator selected by it, then the party not in default may apply to the
American Arbitration Association for the appointment of the second
arbitrator. If the two arbitrators chosen as above shall fail within 15 days
after their selection to agree upon a third arbitrator, then either party may
apply to the American Arbitration Association for the appointment of an
arbitrator to fill the place so remaining vacant. The decision of any two of
the arbitrators shall be final and binding upon the parties hereto and shall


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<PAGE>

be delivered in writing signed  in  triplicate  by the  concurring
arbitrators  to each of the  parties hereto.  Employer shall pay the fees of
the  arbitrators so selected.  The other expenses incurred in connection with
the arbitration shall be paid in accordance with  Section 19.  Judgment  on
the award  rendered  by the  arbitrators  may be entered in any court having
jurisdiction.

         19.      LEGAL FEES AND EXPENSES. In the event an action is brought
to enforce any provision of this Agreement, Employee's legal fees and
expenses shall be paid by Employer as incurred by Employee, unless Employee
brings a claim which is determined by the arbitrator to be frivolous, in
which case, Employee shall repay to Employer all amounts advanced by Employer
to Employee in connection with such claim within thirty days of such
determination.

         20.      SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other provision or any other jurisdiction, but this
Agreement shall be reformed, construed and enforced in such jurisdiction as
if such invalid, illegal or unenforceable provisions had never been contained
herein.

         21.      AMENDMENTS AND WAIVERS. This Agreement may be modified only
by a written instrument duly executed by each party hereto. No breach of any
covenant, agreement, warranty or representation shall be deemed waived unless
expressly waived in writing by the party who might assert such breach. No
waiver of any right hereunder shall operate as a waiver of any other right or
of the same or a similar right on another occasion.

         22.      COUNTERPARTS. This Agreement may be executed by the parties
in separate counterparts, each of which when so executed and delivered shall
be an original, but all such counterparts shall together constitute but one
and the same instrument.

                                       11
<PAGE>

         23.      SECTION HEADINGS. The headings of each Section, subsection
or other subdivision of this Agreement are for reference only and shall not
limit or control the meaning thereof.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.

                            "Employer"

                             WILLIS LEASE FINANCE CORPORATION

                             By:
                                 -----------------------------------------------
                                 Name: Charles F. Willis, IV
                                 Title:  PRESIDENT AND CHIEF EXECUTIVE OFFICER

                            "Employee"

                             --------------------------------------------------
                                               Nicholas J. Novasic

                                       12
</TEXT>
</DOCUMENT>
