What Is Cross-Default in Aircraft Leasing?
Cross-Default defined for aviation professionals, with its operational or commercial use, document context and related terminology.
How the Term Is Used in Aviation
A cross-default clause allows a default under one agreement or debt obligation to trigger a default under another financing or lease.
Aviation Glossary
Term: Cross-Default
Category: Aircraft Leasing & Finance
Where the Term Appears
Cross-Default can appear in aircraft leases, loan agreements, security documents, appraisals, insurance provisions or closing deliverables depending on the transaction. The exact legal effect comes from the executed documents, governing law and the role of each party.
How It Affects the Transaction
Aircraft groups with multiple SPVs, loans or leases should map these provisions carefully because a problem on one asset can affect otherwise performing transactions.
What to Review
Read the definition together with payment mechanics, default provisions, insurance, maintenance, return conditions, security and enforcement rights. A familiar label can have a different economic effect when the drafting or calculation method changes.
Related Aviation Topics
Related ACMI World coverage includes key terms in aircraft leasing contracts, business jet leasing, aircraft acquisition financing, cross-border jet lease terms and aircraft valuation and LTV.
Aircraft groups with multiple SPVs, loans or leases should map these provisions carefully because a problem on one asset can affect otherwise performing transactions.
Cross-Default FAQ
What does Cross-Default mean in aviation?
A cross-default clause allows a default under one agreement or debt obligation to trigger a default under another financing or lease.
Why does Cross-Default matter?
Aircraft groups with multiple SPVs, loans or leases should map these provisions carefully because a problem on one asset can affect otherwise performing transactions.
Where would an aviation professional encounter Cross-Default?
It is commonly encountered in aircraft leasing & finance documents, procedures, calculations or operating discussions where the underlying technical or commercial issue is relevant.
Does the term have the same meaning in every aircraft finance document?
No. Market terminology is useful shorthand, but the executed agreement controls. Defined terms, calculation methods, governing law and transaction structure can change the result.