Replacement Engine. (a) If at any time and from time to time, the Engine may, or may be required to, be replaced under Section 6(a) or 11(a) of the Lease by a Replacement Engine, as the case may be, in accordance with the provisions of this Section 5.06 and the provisions of said Sections of the Lease, the Owner Trustee shall, at such time or times, but subject to compliance with the conditions to such replacement set forth in the Lease, direct the Indenture Trustee to execute and deliver to or as directed in writing by the Owner Trustee an appropriate instrument releasing the Engine as appropriate from the Lien of this Indenture and the Indenture Trustee shall execute and deliver such instrument as aforesaid, but only upon receipt by or deposit with the Indenture Trustee of the following: (1) A written request from the Owner Trustee, requesting such release and specifically describing the Engine so to be released and the Replacement Engine. (2) A certificate signed by a duly authorized officer of the Lessee stating the following: A. [Intentionally reserved] B. With respect to the replacement of the Engine: (i) a description of the Engine which shall be identified by manufacturer's name and serial number; (ii) a description of the Replacement Engine (including the manufacturer's name and serial number) to be received as consideration for the Engine; (iii) that on the date of the Indenture Supplement relating to the Replacement Engine the Owner Trustee will hold title to the Replacement Engine free and clear of all Liens except Permitted Liens, that such Replacement Engine will on such date be in good operating condition, and that the Replacement Engine is the same or an improved model as the Engine; (iv) the value, remaining useful life and utility of the Replacement Engine as of the date of such certificate (which value, remaining useful life and utility shall not be less than the then value, remaining useful life and utility of the Engine, assuming the Engine was in the condition and repair required to be maintained under the Lease (but without regard to hours and cycles until overhaul)); (v) that no Lease Event of Default has occurred and is continuing or would result from the making and granting of the request for release and the addition of the Replacement Engine; and (vi) that each of the conditions specified in Section 11(b) of the Lease with respect to the Replacement Engine have been satisfied. (3) The appropriate instrument or instruments (i) transferring to the Owner Trustee title to the Replacement Engine to be received as consideration for the Engine, (ii) assigning to the Owner Trustee the benefit of all manufacturer's and vendor's warranties generally available with respect to such Replacement Engine (if any) (which warranties may be assigned by the Owner Trustee to Lessee pursuant to Section 5(d) of the Lease), and (iii) subjecting such Replacement Engine to the Lien of this Indenture and subjecting to any relevant Assigned Sublease and Sublease Assignment, including, without limitation, an Indenture Supplement. (4) [Intentionally reserved] (5) The opinion of counsel to the Lessee, satisfactory to the Indenture Trustee, stating that: (i) the certificates, opinions and other instruments and/or property that have been or are therewith delivered to and deposited with the Indenture Trustee conform to the requirements of this Indenture and the Lease and, upon the basis of such application, the property so sold or disposed Trust Indenture 71 - 66 - of may be properly released from the Lien of this Indenture and all conditions precedent herein provided for relating to such release have been complied with; (ii) the Replacement Engine has been validly subjected to the Lien of this Indenture and covered by the Lease, the instruments subjecting the Replacement Engine to the Lien of this Indenture and the Lease, and subjecting to any relevant Assigned Sublease and Sublease Assignment, as the case may be, have been duly filed for recordation pursuant to the Federal Aviation Act or any other law then applicable to the perfection and the effect of perfection or non-perfection of a security interest in the Engine or the Lien of this Indenture, and no further action, filing or recording of any document is necessary in order to establish and perfect, in the United States and, if the establishment of title and perfection and the effect of perfection or non-perfection of a security interest in such Replacement Engine or the Lien of this Indenture are governed by the laws of a jurisdiction other than the United States, in such jurisdiction, the legal title to such Replacement Engine and the Lien of this Indenture on such Replacement Engine; and (iii) the Owner Trustee and the Indenture Trustee (as assignee of the Owner Trustee's rights under the Lease) shall be entitled to the benefits of Section 1110 of the Bankruptcy Code with respect to the Replacement Engine to the same extent as with respect to the Engine prior to such replacement. (b) Upon the acquisition by the Owner Trustee of title to or other interest in any Part under and as provided in the Lease, the same shall automatically and without further act become subject to the Lien of this Indenture, and to the extent the Owner Trustee is divested of title to or other interest in any Part under and as provided in the Lease, the same shall automatically and without further act cease to be subject to the Lien of this Indenture. The Indenture Trustee shall at any time and from time to time at the request of the Lessee execute an appropriate written instrument or instruments to confirm the release of any Part from the Lien of this Indenture as provided in this Section 5.06(b), but only upon receipt by the Indenture Trustee of an Officers' Certificate of Lessee confirming such release is authorized by the terms hereof.
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Sources: Trust Indenture and Security Agreement (America West Airlines Inc)
Replacement Engine. The replacement engine shall not have accumulated more than one hundred ten percent (a110%) If of the total Flight Hours and Cycles since new and since completion of the most recent Engine Restoration as compared to the replaced Engine and have a value and utility at any time least equal to, and from time to timebe in as good operating condition as, the Engine may, or may be required to, be replaced under Section 6(a) or 11(a) of the Lease by a Replacement Engine, as the case may be, in accordance with the provisions of this Section 5.06 and the provisions of said Sections of the Lease, the Owner Trustee shall, at such time or times, but subject to compliance with the conditions to such replacement set forth in the Lease, direct the Indenture Trustee to execute and deliver to or as directed in writing by the Owner Trustee an appropriate instrument releasing the Engine as appropriate from the Lien of this Indenture and the Indenture Trustee shall execute and deliver such instrument as aforesaid, but only upon receipt by or deposit with the Indenture Trustee of the following:
(1) A written request from the Owner Trustee, requesting such release and specifically describing the Engine so to be released and the Replacement Engine.
(2) A certificate signed by a duly authorized officer of the Lessee stating the following:
A. [Intentionally reserved]
B. With respect to the replacement which such Event of the Engine:
Loss shall have occurred, based on but not limited to (i) a description of the Cycles accumulated on each Engine which shall be identified by manufacturer's name and serial number;
Life Limited Part, (ii) a description Flight Hours accumulated since new (and accumulated since completion of the Replacement most recent heavy maintenance shop visit that completed a workscope at least equivalent to that of an Engine (including Restoration if an Engine Restoration had previously been accomplished on the manufacturer's name Engine that suffered such Event of Loss), and serial number) to be received as consideration for the Engine;
(iii) that Flight Hours and Cycles accumulated since new (and accumulated since the most recent restoration or refurbishment of each engine module with respect to any module for which a restoration or refurbishment had previously been accomplished on the date Engine that suffered such Event of Loss), assuming such Engine was of the Indenture Supplement relating to the Replacement Engine the Owner Trustee will hold title to the Replacement Engine free and clear of all Liens except Permitted Liens, that such Replacement Engine will on such date be in good operating condition, and that the Replacement Engine is the same or an improved model as the Engine;
(iv) the value, remaining useful life value and utility of the Replacement Engine as of the date of such certificate (which value, remaining useful life and utility shall not be less than the then value, remaining useful life and utility of the Engine, assuming the Engine was in the condition and repair as required by the terms hereof immediately prior to the occurrence of such Event of Loss. Prior to transfer of title of such replacement engine to Lessor, both Lessor and Lessee shall in good faith determine whether an adjustment, if any, should be maintained under made to the Lease Engine Reserves for the replaced Engine and following transfer of title of such replacement engine to Lessor, if it was determined that (but without regard x) additional Engine Restoration Reserves (if applicable) or Engine Life Limited Parts Reserves were due, then Lessee shall promptly pay such amount due to hours and cycles until overhaul));
Lessor or (vy) that the amount then currently held by Lessor is in excess of what is needed in the Engine Restoration Reserve (if applicable) or the Engine Life Limited Parts Reserve for the replacement engine, then, provided no Lease Event of Default has occurred and is continuing or would result from the making and granting of the request for release and the addition of the Replacement Engine; and
continuing, Lessor shall promptly refund such excess amount to Lessee, provided, that if, after becoming an Engine pursuant to this Lease, such replacement engine is covered by a Lessee Engine TCA (vi) that each of the conditions specified as defined in Section 11(b2.A.(vi)(d) of Appendix 2D hereof), the Lease with respect adjustments described in this Section 20.4(a) shall only apply (A) to the Replacement Engine have Restoration Reserves if an Engine Restoration has not been satisfied.
(3) The appropriate instrument or instruments (i) transferring to the Owner Trustee title to the Replacement Engine to be received as consideration for the Engine, (ii) assigning to the Owner Trustee the benefit of all manufacturer's and vendor's warranties generally available accomplished with respect to such Replacement Engine (if any) (which warranties may be assigned by replacement engine during the Owner Trustee Lease Term, subject to a requirement for Lessee to make a payment to Lessor on the Termination Date pursuant to Section 5(d2.A.(vi)(d) of the Lease)Appendix 2D hereof, and (iiiB) subjecting such Replacement Engine to the Lien of this Indenture and subjecting to any relevant Assigned Sublease and Sublease Assignment, including, without limitation, an Indenture Supplement.
(4) [Intentionally reserved]
(5) The opinion of counsel to the Lessee, satisfactory to the Indenture Trustee, stating that:
(i) the certificates, opinions and other instruments and/or property that have been or are therewith delivered to and deposited with the Indenture Trustee conform to the requirements of this Indenture and the Lease and, upon the basis of such application, the property so sold or disposed Trust Indenture 71 - 66 - of may be properly released from the Lien of this Indenture and all conditions precedent herein provided for relating to such release have been complied with;
(ii) the Replacement Engine has been validly subjected to the Lien of this Indenture and covered by the Lease, the instruments subjecting the Replacement Engine to the Lien of this Indenture and the Lease, and subjecting to any relevant Assigned Sublease and Sublease Assignment, as the case may be, have been duly filed for recordation pursuant to the Federal Aviation Act or any other law then applicable to the perfection and the effect of perfection or non-perfection of a security interest in the Engine or the Lien of this Indenture, and no further action, filing or recording of any document is necessary in order to establish and perfect, in the United States and, if the establishment of title and perfection and the effect of perfection or non-perfection of a security interest in such Replacement Engine or the Lien of this Indenture are governed by the laws of a jurisdiction other than the United States, in such jurisdiction, the legal title to such Replacement Engine and the Lien of this Indenture on such Replacement Engine; and
(iii) the Owner Trustee and the Indenture Trustee (as assignee of the Owner Trustee's rights under the Lease) shall be entitled to the benefits of Section 1110 of the Bankruptcy Code with respect to the Replacement Engine to the same extent as with respect to the Engine prior to such replacement.
(b) Upon the acquisition by the Owner Trustee of title to or other interest in any Part under and as provided in the LeaseLife Limited Parts Reserves, the same shall automatically and without further act become subject to the Lien of this Indenture, and to the extent the Owner Trustee is divested of title to or other interest in any Part under and as provided in the Lease, the same shall automatically and without further act cease to be subject to the Lien of this Indenture. The Indenture Trustee shall at any time and from time to time at the request of the Lessee execute time such replacement engine becomes an appropriate written instrument or instruments to confirm the release of any Part from the Lien of this Indenture as provided in this Section 5.06(b), but only upon receipt by the Indenture Trustee of an Officers' Certificate of Lessee confirming such release is authorized by the terms hereofEngine.
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